The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1899-08-02
AFTER HOT AIR COMPANIES
COMMISSIONER O'SHAUGHNESSY
TURNS HIS ATTENTION TO AL
LEGGED INSURANCE CONCERNS
Attention of Attorney General
Douglas Is Directed TO Organiza-
lions Which Do Business on No
Better Capital Than Wind.

Insurance Commissioner O'Shaughnessy
is adopting rigorous policy in his de-
partment toward hail insurance com
panies that are organized solely for pc
cuniary profit of the officers. He yester-
day referred two cases to ATTORNEY Cen
eral Douglas, where the law has been
violated, and in one case criminal pro-
ceedings against the officers of the COM
pany may follow. The Farmers and Mer-
chants Protective Union of Glenwood
has evidently been a good thing for the
officers. 1t was organized in 1895, and
to date It's total receipts have been
$S.612.O7. of which $500 has been paid to
claimants, and $6542.O7 went to pay the
salaries of officers and expenses" Com
missioner O'Shaughnessy, in addressing
the attorney general, says:
Little protection is afforded the public
if companies of this character are to be
permitted to operate under the guise of
mutual benefit societies for the sore pur-
pose of pecuniary profit to officers with
out regard whatever for the rights of
members and benefciarIes. The officers
of the company should be compelled to
return at least 40 per cent of the amount
charged to expenses, which I believe I'M
lawfully taken"
The company was organized in 1895.
with the following officers, who have
served since that time: President A. l..
Brice; vice president, J. D. Utley: secre-
tary and treasurer, L. E. Utley The in
surance commissioner claims that the
records Of the company do not CORE
spond with the sworn statements which
have been made to the insurance depart
ment. None of the statements show an
actual income, and at present there are
but twelve certificates in force There
are claims against the company for some
thing less than $780, which will necessitate
a heavy assessment upon the certificate
holders.
After deducting the amount paid in
claims and expenses there still remains q
balance of 81, 4663O. OF this amount $500
IS represented by worthless notes given
by members as membership fees The
balance of 4.43, the company Claims
represents premiums collected and re-
tanned by agents as commissions. but
there is no record on the books showing
this. Mr.. O'Shaughnessy explains in his
letter to the attorney general that the
officers of the company, after consider
able hesitation, made this explanation
of the item Of $500. At least the COM
pany's method Of bookkeeping was not
to be commended, and the insurance
OS--@-~N@S0-O
the company be applied for and its af-
fairs wound up.
Another company, in which the same
set of officers are Interested, is the Realty
Revenue Guaranty Company of Mime
apolis The operations of the Minneapo-
lis company are somewhat different, as
the company is not mutual concern
but the insurance commissioner claims
that the hail policy or contract Is
fraudulent, and asks the attorney gem
eral to take such action as he may deem
fit. The company has never come in I'M
der the insurance laws Of the state and
has no license to write insurance. In
fact, it is claimed, the policy that is is
sued by the company is so worded that
It would be impossible to collect a loss.
Both matters are in the hands of At
torney General Douglas, who stated
yesterday afternoon that he had not de-
cided what course to pursue in the mat
ter. IT is quite likely that very effective
measures will be taken to bring the com
pantes to time, as it is the intention of
state officials to make an example of
wind and air companies IL there are anv
of that kind doing business In Mime
sofa