The San Francisco call., 1898-11-11

1 property, was one of the most gigantic
 ever fought on this coast or in the | United States. It was a contest o1
 millions against millions, and as the
 outcome proved determined the exist | ence of two great banks. When this
 great fight began Sherman calculated
 every possible contingency. He sur rounded himself with able lawyers and | when the Pacific Bank and the Peo- ple's Home Savings Bank crumbled, he
 made terms with the opposition, sold
 out his holdings in the Electric road and profited with what belonged to the wrecked institutions and their deposi- | tors.
 | When Sherman began his manipula- tions and with fattery seduced Frank Mcdonald into a support of his scheme | he carefully guarded against any mis- hap to the success of his plan. He was closely allied to Millspaugh, the ex- claim adjuster of the Southern Pacific Company. and through him gained the support of that corporation. After he had seduced Frank Mcdonald into the wild Phoenix proposition and before he suggested his Electric deal he offered himself as a director In the Pacific Bank. According to his own assertion he held only ten shares of stock in that institution and acted simply in the ca pacity of a dummy. He bought a few shares of stock in the Peoples Home Savings Bank and placed his cousin John D. Farnum in the bank as secre- tary and manager. Having gained a foOthold in both banks, he operated as he pleased to the end, and when the crash finally came he exercised his in- fuence to make Farnum~ manager Of the Pacific Bank This in outline is the story of the tremendous plot that Moses H. Sherman carried to a suc> cessfuI conclusion, and in doing so ac- complshed the downfall of both banks. SECRET HISTORY OF THE GREAT
 CONSPIRACY.
 The most thorough and complete in- Vestigation of the Los Angeles electric railroad scheme that was ever attempt ed was made by II, Woodland, eX newspaper man and lawyer. This man was the bitter and persistent enemy of M. H. Sherman, and lost no opportu- nity to injure the crafty manipulation. His enmity, however, was simply an in- cident. He was more thoroughly in- formed of the condition Of the electric road and of the disastrous speculation it represented to the Pacific Bank than any man except Moses H. Sherman himself. Woodland was familiar with the affairs of the great concern from the very inception of the project in the brain of Sherman. At the request of R. H. Mcdonald Jr. Woodland on Au- gust 4, 1892, submitted an exhaustive report of the history of the road, it's condition at that time end its pros poets.
 Woodland demonstrated to young Me Donald that the Pacific Bank had been trapped into a dangerous venture and that If 1t did not retire even with the heavy loss it must sustain the bank in- evitably would go under This report of Woodland is vitally necessary to the depositors and robbed creditors of the defunct bank, if they care to obtain a clear understanding of the gigantic scheme that ruined the institution and cost them their Qosits. In the report Woodland has eliminated all personal reflection upon Sherman. The report simply recites the facts of the con spiracy that resulted in the deception upon the Pacific Bank. Sherman's wild notions of finance and his absurd ideas of floating bonds are described clearly and something of the tremendous struggle between the cable system of Los Angeles and the electric road is indicated.
 This struggle provoked the most bit ter enmity between J. r. Crank, the leading spirit in the cable road, and sherman. It organized most of the banks of this city against the Pacific and the Peoples Home Savings banks, and at one stage of the fiPht forced a run on the Peoples Home Savings Bank. It is perhaps not uninteresting to remember that this run was pro- voked by the simultaneous publication in two newspapers in this city of an 441Iz sI Bank for holding electric bonds. These publications, coming as they did on the same morning and containing practi- cally the same assertions, will prove an interesting history in themselves at the proper place in the recital of the men and measures that ruined the two great banks. Incidentally, Frank Mcdonald exercised every influence in his posses sion to prevent these articles from be- Ing published and to save the Peoples Bank from run For reasons that were very clearly understood he failed. J. H. Woodlands long report that will show how hundreds of thousands of dollars of the Pacific Banl, were dtss- pated in the Los Angeles electric rail- road is given in full as follows. and is intended as a significant introduction to the part that M. IT. Sherman and his co-conspirators played in the de- struction of the Pacific Bank.
 LOS ANGELES, Cal, Aug. 4, 1892.
 MT. R: H. Mcdonald Jr.. V. P. Pacific Bank San Francisco, Cal.-Dear Sir: left San Francisco Monday D. m.. as I told you l expected to, and have been quite busy with other matters, so that only just now have I found time to comply with your request to give you my opinion of the street railway situation In Los An geleS l shall keep in mind your sugges- ton that the expenditures have been made on the electric property, and therefore mat you are only considering what should be done to save the investment and, if possible, make a profit out of It. shall give you the situation as I understand it. think best to test the correctness of my conclusions '