The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1898-11-05
The AttOrney-General Drove the
MCDOnaldS to the Point
Of Desperation.
GOnSpiIatOrS Began to Desert the Standard
of the Pacific Bankers as the
End Approached.

In the strange history of disaster ant
crime that marked the existence of tht
Pacific and Peoples banks there are
few facts of more Importance thar
those published in The Call this morn
ing. The record proceeds to within
two months of the final crash in which
the bank went down. The conspira-
tors. who had thrived on the dishonesty
and the gullibility of the McDonalds
were beginning to desert. They knew
better than the deluded bankers the
true condition of the institutions and
they knew that affairs could not con-
tinue much longer as they were. A. F.
Johns. saw an opportunity TO condi-
ton himself better with the enemies
of the McDonalds and he proceeded to
pick a quarrel Dorm and Tomblin
were becoming ffactious and Hart was
becoming more insistent in his demands
for money
There is in the whole history of the
Pacific Bank no more significant ele-
ment than that involved in the relation
ship between W. II. H. Hart and the
McDonalds. Hart was then Attorney
General of the State and had bled the
McDonalds to such point that they
Hart. in exchange for the money he
received gave the cloak of his official
position with which to cover the dis
honest acts of the bankers, In Feb
ruary. 1893, however, Frank Mcdonald
believed that the debt that they owe.i
TO Hart for his criminal support had
been paid and until they needed the
dishonest official again they rebelled
against his demands. In a telegram
sent by Frank from Los Angeles it is
clearly stated and understood that the
McDonalds were paying Hart for his
dishonest services. They therefore had
a right to estimate the value of that
service and to resist what they deemed
extorfion. AS the history of the bank
proceeds The Call will show how COM
pletely the Attorney General was at
the command of the bankers when
financial ruin faced them.
Among all the quarrels of the con-
spirators there were few that were
more serious than that between Frank
Mcdonald and. NJ. H. Sherman. Frank
in one of the letters published to-day
places upon the. shoulders of Sherman
the complete responsibility of the ruin
of the Pacific Bank. The young banker
refers bitterly 10 the fact that through
the agency of Sherman the Pacific
Bank had accepted $581, 900 in practi-
: cally. worthless bonds. Sherman was
bitterly denounced for trapping the
Pacific Bank into this deal. The letters
published to-day will also show the
desperate measures to which the
bankers resorted as the end drew near
Instead of attempting to recover them
selves Frank Mcdonald and his brother
plunged deeper into wild speculation
Their crazy financial fancies had full
swing and new and heavy losses We're
incurred The young bankers knew that
they were being more carefully
watched by the official examiners and
recourse was had4to a deliberate falsi-
fcation of ne &nooks. In this way
some of the old and disastrous schemes
were made responsible for heavy losses
that did not belong to them. New
ventures in which vast sums of money
We're sunk escaped and such specula-
tfoTls as the John Brown colony were
debited with great sums never re-
ceiVed in this way the thieving bank
ers We're enabled to plan and execute
new robberies under the mask of old
and bad speculations.
THE McDONALDS REBELLED AT
HART'S EXACflONS.
In all the correspondence of the
managers, manipulators and wreckers
of the Pacific and Peoples banks there
is no more important document than a
telegram which Frank Mcdonald sent
TO X. II. Mcdonald Jr. on February 5,
1892: 1t has been limited that w H H.
Hart, who was then Attorney General 4
or the State, had neglected his duties /
IN connection with the Mcdonald in /
Ettutlon and the Bank Commissioners. !
Inc CAN Is enabled to state positively |
TINS morning that w. II. H Hart was /
criInlnaly in collusion with the Nc !
Donalds and was demanding loans and 4
nnanclat accommodation for his silence /
ana Tor MS refusal to force the man |
ayers OF the wrecked bank to stop their |
roppery or the depositors. The first
PROOF OF Harts coiiusion was given in I
the following telegram:
Los ANGELES. Cal Feb < 1909
r. II. Mcdonald Jr Pacjac Rank
San Francisco: I lea5-e to,,,o,, d,e,i1n,
(Monday) night for Kansas civ cir.
cinnau ana ana New York. Matters here
rs we all can see Hart can be of no
use nor harm in this matter and
you better not give him that accom-
never repay It. Tell him If is n,,Sifc
talk, and II will not do for rs II be
mixed up In IT,. We have accornrnn
dated him enough and you can safely
refuse him. FRANK
ORGANIZING NEW AND DIsAS-
TRoUS SPECULAToNs.
when Frank ". Mcdonald again
wrote to his brother the letter was