The Chanute times. [volume] (Chanute, Kan.) 1897-1913, 1897-01-01
WORK OF WRECKERS:
CAUSE OF THE ILLINOIS
NATIONAL FAILURE.
Onicers of the Bank Played for Millions
and Failed-TrIed to Depreciate Calu-
met Electric Stock, and Then Buy It

CHICAGO, Dec. 22.-The National
bank of Illinois, one of the oldest and
best known banking institutions in the
city, and with assets of between $12,-
900, 900 and $15, 100000, closed its doors
yesterday, the following notice being
posted before the opening of banking
hours:
This bank is in the hands of the
national bank examiner.-By order Of
the comptroller of the treasury"
Of the sixteen banks that cleared
through the National Bank of Illinois,
two closed their doors as a result of
the closing of that institution. These
were those of e. S. Dryer G. Co. and
Wasmandorff g. Heinemann. These
two institutions were mortgage loan
banks and savings societies and their
failures are not expected to affect any
business houses, The assets of E. 8.
Dryer 81 Co. are given at 1000, 900,
with liabilities of S1,20O,OOO. The
figures for Wasmandorff & Heinemann
are, approximately: Assets, $3.50, 900;
. liabilities, 100000
CHICAGO, Dec. 23.-The failure of
Angus & Gildele, general contractors;
the American Brewing, Mailing and
Elevator company and George A. Weiss,
individually, all of these being due to
the collapse of the National Bank of
Illinois, and small runs on three
banks were the echoes yesterday
of the bank failures of Monday.
CHICAGO, Dec. 24.-W. A. Hammond,
second vice president of the National
Bank of Illinois, who has been charged
with pulling the wool over the defunct
bank, would not talk when seen in his
palatial home at Evanston. Through
an intimate friend, however, he made
n statement which is calculated to in
culpate several directors, as well as
two or three men who are not con-
nected with the bank.
'W. A. Hammond is to be made the
scapegoat of the failure of the National
Bank of Illinois," said the friend.
Hammond Is broken man to-day,
but he Is not any more to blame for
the amount of money loaned on Calu-
met securities than are the members
of the finance committee of the bank
and it's directors. 1t was necessary to
the purposes of a man connected with
the South Chicago City railway and an
officer of one of the best known banks
of this city to depreciate the Calumet
Electric roads stocks, and to this
end, these two men brought about the
wrecking of the National Bank of
Illinois.
''Of the banks funds, So, AS, 900 had
been loaned on the Calumet securities.
The plan for wrecking was brilliant.
Cause an investigation, depreciate
Calumet stock and buy it. Then com
bine this valuable property of sixty
three miles of new track, equipment
and franchise with the South Chicago |
railway, eventually combining with |
the Chicago City railway and make a |
fortune OF millions within five or zen |
years.
"The loan was increased with the |
full knowledge of members of the fl
nance committee and later on was
was made known to tine TIL ectors.
Members of the finance committee and !
officers of the bank were given stock,
and the purpose of the deal was to sell |
the road and, besides paying the bank |
loan, make a good round sum for the
directors. There has been a severe
contest between the General Electric
and the South Chicago City railway to
secure control of the bonds of the Cal
umet road, and the stocks which
go with them, and it was thought |
that the road could finally be sold
at something like SO, 900, 900 or 81 ,00O,-
O00 1t was brilliant idea for a man
connected with the South Chicago City |
railway to wreck the bank, and the
men who had been backing Calumet
the bank. 1t has succeeded,
and the probabilities are that the Calu-
met Electric will be sold to the South
Chicago City railway man and his
friend, the banker, who lent his name
to the scheme to make a good pot out
Of the deal himself.
"The part the banker took in the
matter was a safe one. He called the
attention of the bank examiner to the
fact that Calumet securities had disap-
peared somewhere, intimating that the
National Bank of Illinois had good
share of them and probably had them
all
"The officers of the bank, finding
that the bank examiner was not on
their trail, began to push the transac-
tions they had on foot for the sale of
the securities and the clearing house
became alarmed. Could the matter
have been delayed thirty or sixty days
The Calumet Electric securities would
not have been found in the banks
assets. The sale would have been eff
fected, possibly at loss to the bank,
but without disturbance to the public
Or heavy loss to the stockholders of
5he bank. But this course would not
suit the purpose of persons trying to
control the Calumet Electric road.
"Three years ago E. S. Dreyer, alone
)wed the bank 81, 900, 900, and for three
years Mr.. Hammond has been trying to
'educe that 1t was reduced one-half
when the doors of the bank closed, and
t was due to Vice President Hammond
hat this was accomplished. If the
securities for the loans to these two
and Weiss-have disap-
cared, they disappeared Saturday.
rhat point may come out later. One
lirector in the bank who has been
allSing great deal since the condi-
ion of the concern became public took
;l2, 900 out of the bank Saturday after
loon.