The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1897-07-31
Coi-. scHEFFER SHOWS SIGNS OF
EXCITEMENT ON THE WITNESS
STAND.
COURT TOOK A BRIEF RECESS.
RECITAL OF HIS CONNECTION WITH
THE ALLEMANNIA ALMOST UP
SET THE PRESIDENT.
WHOLE STORY LAID BARE BY HIM
Says All of His Property, Income
Etc, Went in to Help the
Institution.


stand yesterday in his own defense.
AS predicted by the G o e, the court
declined to dismiss the case on mo-
ton of the defense. The state rested
just before the noon recess. When
court convened at p. m, Gen. Clapp,
counsel for, the defense, moved for a
| dismissal of the case On the ground
that the state had not proved the lar
ceny Of $1,000 charged in the indict-
ment.
In support of his motion Gen. Clapp
read at length from the decision of the
court In the case of the state against
ex-Clty Treasurer Kortgaard, of Min
neapolis. In that case the court enun-
clated the principle that to convict the
defendant 1t was necessary to show
that he had full control of the funds of
the bank, whereas, the testimony of
Cashier Barnett had clearly shown that
Col Scheffer had nothing to say regard
ing the discounting of his paper, but
that everything was left to the discre-
ton Of the discount committee, which
did not include Col. Scheffer.
In opposing the motion to dismiss,
Assistant County Attorney Zollman
contended that Col. Scheffer, while not
in full control Of the funds and affairs
Of the bank, still possessed concurrent
authority and was to that extent re-
Sponsible for the conduct of it's affairs
Mr.. Zollman also insisted that the tes-
timony adduced by the state ought to
go to the jury.
The argument of the motion to dis
miss consumed little over an hour. At
its conclusion, Judge Bum denied the
motion, and the court took a recess for
fifteen minutes, after which Attorney
Nelson opened the case for the defense.
In his address to the jury Mr.. Nelson
traced the history of the Ailemannia
bank, giving an account of it's out
growth from the Commercial Bank of
st. Paul, and Of Col. Scheffer's connec-
ton with the Commercial bank Mr..
Nelson declared that with all of his
Indebtedness to the Allemannia bank,
Col. Scheffer never received a cent
more than $4,000. He explained how
the overdrafts came to be made by Mr.
Scheffer for the purpose of paying the
taxes, fire insurance and assessments
on the property and premiums on life
insurance policies he had turned over
to the Local Investment company as
collateral for his indebtedness to the
bank. Had Mr.. Scheffer not paid all
these there would not have been any
overdrafts.
Upon the conclusion of Mr. Nelson's
opening address, he conferred with Gen.
Clapp for few moments and then
called the defendant to the witness
stand. Col. Scheffer stepped forward
= q 70
tell his story to the jury Being sworn.
he proceeded, giving his testimony
distinctly and concisely at first. But,
growing nervous as his financial re-
verses were inquired into, his voice
and demeanor betrayed excitement es-
pecially when he took occasion to MAXI
a sarcastic comment upon the grand
jury that indicted him. Judge Lewis
noted the agitated manner of Col.
Scheffer, and announced that the court
would take recess for five minutes.
According to Col Scheffer's testimo-
ny, he gave everything he had, save
the money necessary to support his
family, to the bank to secure. his in
debtedness.
Mr.. Scheffer said that he first came
to ST. Paul in 1860, went to the war
in 1852 returned to ST Paul in 1866, and
had lived here ever since. Mr. Scheffer
related the history of the organization
of the Commercial National bank in
1887, and the subsequent organization
of the Commercial bank under the state.
law. The capital stock of the Com
mercial bank was 100000 The Com
mercial bank closed it's doors in April,
1892. but reopened them in September
of that year, when the capital stock
was scaled down to 100000. Col. Schef-
fer owned a little over $500, 900 of the
capital stock of the Commercial bank
o1nc
cent of this was cancelled and, when
the bank reOpened in September, 1892
Col. Scheffer purchased $40, 900 worth
of the new stock, making the whole
amount of stock owned by him at the
reopening $4,000 Col. Scheffer said
that his direct Indebtedness to the
Commercial National bank in 1850 was
$4,000. His Endorsements amounting
to 100000 were purely accommodation
Endorsements.
When the bank reopened in 1892, Col.
Scheffer said that he assumed an in
debtedness to the bank of about $25,-
600, for which he was not legally re-
sponsible, and for which he had re-
ceived no pecuniary benefit.
The Local Investment company was
organized, Col. Scheffer said, about
three months after the reopening of
the bank. The purpose was to use the
company as vehicle or receptacle
for his securities for collateral pur-
poses. The capital stock of the COM
pany issued to him was $4,000. Col.
Scheffer said that his homestead alone
was considered worth $150000 1t was
transferred to the Local Investment
company, subject to a mortgage for
$4,000. Col. Scheffer also transferred
to the company his $4,000 worth of
stock in the bank, twenty-seven lots
in Gotzian's addition, a farm in West
st. Paul that cost over $4,000 and sew
eral houses and sundry stocks and
bonds
Col. Scheffer said that he turned over
to the bank the $4,000 of stock in the
Local Investment company as collateral
The notes of the company. Col. Schef-
fer endorsed.
Col. Scheffer testified that not dol
lar of the $4,000 paid by him for the
new bank stock came from the bank.
He raised $4,000 by mort gaging his
homestead $4,000 his wife furnished,
and $4,000 came from outside sources.
The Northwestern Security Invest
ment company was organized two years.
later to buy assets of the German Fire
Insurance company, for which $4,000
was paid and $4,000 more for putting
them into han nd