The morning news. [volume] (Savannah, Ga.) 1887-1900, 1897-03-01
WAS A STUPENDoUS STEAL.
RECEIVER O,BYRNE ON THE LOOT
ING OF THE SOUTHERN MUTUAL.

ING OF THE SOUTHERN MUTUAL.
An Apparent shortage of Not Less
Than $25O, OOO-seeurities Amount
ing to $4,000 Disposed of ny the
President. the Receiver Says, And
No Entry Made On the BOOks-A De-
posit of 500, 900 In "A Defunct Bank
An There Is to show For IA Cash
Balance of 500, O0O-StockhOIders
VIII BE Lucky 10 Get Half.
Mr.. NJ. A. O'Byrne returned yesterday
morning from Atlanta, where he spent
the greater part of last week attending
the annual meeting of the stockholders
of the Southern Mutual and Building and
Loan Association and in investigating
the affairs OF the association.
Mr.. O'Byrne's election as president Of
the company to succeed the defaulrng
president. ". c. Hale. and his subsequent
appointment as one Of the receivers of the
association have already been announced
by the Morning News. The prominent
part taken by Mr.. O'Byrne in securing a
thorough investigation of the affairs of
the association and his subsequent ap-
pointment as receiver is very gratifying
20 the Savannah stockholders, who are
very largely interested In the wrecked in
stitution The Savannah stockholders are
nearly all investors, their stock being
nearly all matured, and very little money
having been taken out on loans The
face value of the holdings here approx
mates $4,000.
According to Mr.. O'Byrne the associa-
ton is the most thoroughly looted insti-
tuition In the state of Georgia. To use
his language, it is the most stupendous
steal that was ever perpetrated in the
state So far as the receivers nave been
able to ascertain, the shortage amounts
to about s2JOOOO. W. c. Hale. the de-
faulting president Of the association, has
disappeared, and all efforts TO locate him
so far have been unsuccessful. Appar-
emily the greatest steal of the whole bust
ness was that of $4,000 of securities of
the association, which were disposed of
TO the Iowa Insurance Company through
the Union Loan and Trust Company of
Atlanta, which is now in the hands Of
receiver. 1t has been stated that the Iowa
Insurance Company paid 100000 for these
the pen to show that the Mutual Building
and Loan Association ever received 81 of
benefit from this transaction.
The only record on the books of the
company relating to this transaction, MIR.
O'Byrne stated, is an entry in the min
utes of meeting of the board of direc-
tors, at which 1t is said only four MEM
bers were present, authorizing the presi-
dent TO arrange for placing 100000 of
debenture bonds of the association to be
secured by collaterals of the association
aggregating $4,000. A wel-known Sc
curity company was to be trustee for the
bonds, but 1t afterward withdrew from
the transaction.
The Union Loan and Trust Company
conducted the deal. No entry, Mr..
O'Byrne says, was ever made on the books
of the company to show what amount of
money was received for the bonds or Sc
curities or what disposition was made of
1t. The transaction appears to have
been a somewhat complicated one, and
all the details have not been gotten at
as yet The president of the Iowa In
surance Company was in Atlanta a few
days before the application for the APP
pointment of receiver was filed, but
whether his visit had any bearing on the
receiyership is not known. The COM
pany was wired for information as to
the deal and a telegram was received in
Anderson of Feb. s would give all in
formation desired. This letter has never
been received.
Another big item of the steai Mr..
OByrne stated, was the trust fund of $685.
600 in cash, which should have been In bank
to the credit of the association. The only
cash found in bank was $4,000, which had
been deposited with the State Savings
Bank, another one of Mr.. Hale's concerns,
which is now in the hands of a receiver.
The indications at present are that the
depostors of the bank will get their
money, but the investigation of the bank s
affairs has not gone far enough yet to
make anything a certainty
Then there Is another big item of loss,
an apparent shortage of 100000 of real
estate loans, which have probably been hy-
pothecated with various concerns. This
sum may have been considerably reduced
by repayment of loans and credits
For assets the association has $685., 900 of
securities in the hands of the state treas
urer and about $4,000 Of assets found in
the safes Of the company. The securi-
ties will hardly realize their face value
and may fall considerably short of the
amount. Assets and claims amounting to
about S150,0O0 are in dispute. The total
liabilities of the company, including stock,
are Sl,l30,OO0. MIR. O'Byrne thinks that the
stockholders Will be lucky to get back 50
n.
There Is no possibility of reorganizing the
association and placing IL on a working
basis again, he said. and the only thing
70 do Is to go ahead and wind up its af-
fairs.
The recelvership is likely to be quite a
lengthy one Mr.. O'Byrne said. on ac-
count of the tangled condition of the as
sociation's affairs, and on account of the
number OF legal points which will have
70 be decided. The relative standing OF
the several classes of Stockholders. of
those who have paid in their stock and
whose claims against the company arc
now matured. those who have given o.
uce Of withdrawal, Those who have not
yet completed the payments on their
stock and the debtor stockholders, who
borrowed money from the association
The position of each class of stockhold.
ers makes an interesting point which vii
have 10 be determined by the court.
Mr. O'Byrne viii go up to Atlanta to.
night for the purpose of qualifying, to.
gether with Judge Anderson, before Judge
Lumpkin, as receiver. The receivers ar,
required 10 give bond for $4,000 eacn
An inventory OF the assets OF the associ
alton will be made as soon as possible.