The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1901-06-14
BITTER FIGHT ON NARIH
NEW YORK. INSURANCE PUBMCA-
TION MAKES SOME SENsA-
TIoNAL CHARGES
FACTS DAMN COMMISSIONER"
Action in Case of Mutual Reserve
Fund Company Precipitates War
Against minnesota and
Wisconsin Officials.

| The recent action of Insurance Commits
s1oner Elmer h Dearth, of this state,
| and Emil Giljohann, of Wisconsin, in
| excluding from their respective states
the Mutual Reserve Fund Life associa-
| ton. as previously related at some length
| IN the q b e, has provoked comment
! ON the par- of insurance publications
throughout the entire United States AS
mas also been previously stated in this
| paper the officers OF the Mutual Reserve
company in a. determined effort to de-
| tend their corporation in the eyes of the
public at large have caused to be cir
| culated broadcast a pamphlet setting
| forth very ingeniousIy their side of the
case. This pamphlet purports to contain
| the correspondence" which passed be-
! tween the officers of the company and
| the insurance commissioners for Mime
| sofa and Wisconsin; but while the cor
respondence thus presented is genuine,
! as lar as 1t goes, it is only an incomplete
| file and contains only such portion Of
| the Whole as will show TO the advantage
| OF the company, the obvious purpose be
| ing to make the company appear in the
| light of a victim of precIpitate and arbi-
| trary action
| AS most of the insurance periodicals
| have depended for their knowledge Of
the case entirely upon the pamphlet re-
| ferred to, naturally their comments are
unfavorable to Messrs. Dearth and Gil
| Johann. Possibly the most radical atti-
tnde in the matter is taken by Insur-
ance, a New York publication which not
only gives President Burnham, of the
| Mutual Reserve fund, space for the pre-
| sentation of his eXpUrgated edition of the
| correspondence, but also arraigns
Messrs. Dearth and Giljonann in an edi-
! torial. This publication. accepting the
| representation of the company that the
! mand Of the Minnesota and Wisconsin
commissioners for an examination was
| when their accredited actuary, Mr.
| Wolfe called at their Office May 81, and
| that the coutpany's officers merely asked
| for a delay of action until the following
Monday, that a. meeting of the stock
holders could be called. proceeding to
say: s.
| DEARTH SEVERELY ARRAIGNED.
But now comes haste On this same
| day (May 81 Wolfe presents a notice
| from the Minnesota insurance commits
| sioner (Which notice is dated this same
| day and purports to have been s-nt from
ST. Paul. Mimi, this same day. Setting
| forth that the ocompanys license has
| been refused because of the company
refusal to permit, the examination. And
! the very next day June y the Wisconsin
insurance commissioner sends similar
notice, except that no reason is ass gned
1.-THE pretense of reason put forward
in the one ease and implied in the 9TH
er was simply lie. There had been no
refusal to permit an examination, but
only request for a chance to consider
whether permission should be given.
ITO US the undisputed and indsputable
facts seem to warrant the Inference that
the whole case was predetermined: the
! Mutual Reserve, Fund was to be shut
out Of Minnesota and Wisconsin. either
with or without an examination; if tie
sudden demand OF the examiner was &c.
coded to, the report of the examination
was to be such as to make showing OF
cause for exclusion; if this demand was
not instantly sacceded to. then contumacy
was to be set US as the reason Tor eX-
cluSion. 4
perhaps our inference from the facts
may be in some part erroneous. Even So
the facts themselves are damnng. The
facts damn the Minnesota insurance COM
missioner and the Wisconsin insurance
commissioner. The facts show that both
these officials have acted unfairly and
oppressively- The facts show that BON
these officials are unfit for the offices
they hold
Commissioner Dearth has not yet re-
turned from the East, and is not expected
for another week, but Deputy Commits
siener Lightbourn, who is conversant
| with all of the proceedings and CORE
spondence in the case, was seen by a re-
rcrter for the Clio b e, and from him
Fund officers had known for months that
an examination by the Minnesota insur-
ance department was to be demanded,
and that this demand was an inevitable
condition OF the renewal of the <ompanys
license. Conclusive proof of this is to be
found in the letter copy books of the
| insurance commissioner office.
The first intimation the company re-
| ceived from. this department that its
financial statement was not favorably
regarded was. contained in a letter sent
by former Commissioner O'Shaughnessy
before he retired from Office and even
he at that time stated in unequivocal
terms that .theD.o Minnesota department
would require an examination before re-
newing the Mutual Reserve Fund license.
AS appears from the letter copy book,
Mr.. Dearthfs5 first letter was March 20
when he wrote 80 the company stating
that its financial statement was not sat
isfactory, and he deemed it best for the
! interests of the policy holders that the
renewal of license be withheld until he
could make an examination, which he
would try to make in April.
Again Mr. Dearth wrote April f. notify
| ing the company that he would De I'M
able to leave St. Paul before May A. but
that he felt constrained, as stated in his
! previous letter, to make an examination.
10 this letter the company replied April
! l6 that its affairs were to be thoroughly
| examined by the New York insurance
! department at once, and it was hoped
! that would be sufficient.
| On April 19 Mr.. DeaGth wrote that he
would defer his examination provided he
could make a joint examination with the
| New York department, and that the eX-
animation could take place at an early
! date, and that unless such arrangement
! could be made he must insist upon an
| Independent examination, as stated in his
| previous letters
| Commenting upon the situation, Mr..
| Lightbourn said: when a company
comes into this state TO do business it
| is amenable to supervision on the part
| of this department or it's agents at any
time. That company's own statement
! showed it to be 81, S25, 119 behind in pay
| ment of claims, besides an additional in
| debtedness of 61.0G9. due in salaries
rents, etc. That is the greatest indebted
ness 1 have ever known any company
with so little capital to have but even
on that showing, if an examination had
proved it to be correct, I doubt if Mr.
Dearth would have excluded the COM
| pany. We were. receiving complaints
every day that the company was delaying
the paymentaof claims, and, in fact, they
still continue to come One man was
here today to make a complaint. Mr.
Dearth thought as Mr.. O'SEaukhnessy
had, that it would be best to find out
Just how the company did stand before
the license vas renewed. As a matter
of fact, that company has not had any
license thiSS year. One was made out