The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-07-15
WANTS TO FLOAT S2O,0O0,Oo0.
LEONARD TNBOBEN OF TIE IN
TERSTATE TRUST 60. HALTED.

Forms OF Law to Secure False Credit.
and All Promoted and Cont rolled by
ImD0dcn---Rcnarls on IubOden's Rep
UtatlOn--An lmb0den OF Missouri.
TRENTON, N. j., July A.-Attorney Gen.
eral RoLert II. McCarter, acting for State
Banking ard Insurance Commissioners
David 0. Watkins, applied to the Chancellor
to-day for the appointment Of receiver
for the Interstate Trust Company of Jersey
City.
The Chancellor signed an order restrain
ing the company from transacting business
pending the consideration OF rule made
returnable before the Chancellor two weeks
from to-day The Banking Department
took charge of the company S affairs with
the ultimate object Of having it put out OF
business entirely.
For several months the Banking Com
missioner has had the company under
surveillance and az a result of nyestiga-
tions in this and other States he charges
in the bill of complaint that the Interstate
company is one link in chain Of trust
companies and banks scattered throughout
the country which are using the forms OF
| the law to secure specious and false credit
for all of the institutions All of these
companies, the Commissioner alleges, have
been promoted and are controlled by Leon
ard Imboden Of New York and his associates.
Among the institutions which the depart
| I, lbs, al; rod in n
are the Fidelity Title and Trust Company
Of Stamford, Conn, the Central Trust
| Company of South McAlester, l. T., the
Cherokee National Bank of Enid, Okla,
the Farmers National Bank Of King
fisher, okla, the National Bank Of Com
merce of Fort Worth Tex, and the New
Castle Trust Company of New Castle. Del.
! As far as the examiners Of the depart
mCnt have been able TO discover, most OF
| these institutions have done little actual
| business to date, except to establish line
! of assets" Ivy an exchange of stocks and
| bonds and by allrg d deposits with one
another 1t is shown, however, that the
/ Interstate company, with practically no
! business. proposes to float s2O,0Oo,OOO OF
collateral trust mortgage bonds and to in
| crease its capital stock from 100000 to
( IS ,OOC 900, and this, the Commissioner says.
| is sufficient to raise suspicion as to the
+ motives prompting such transaction.
The Interstate company was organized
last December and at that time deposit
| of 100000 in cash was made with the Ma
tional City Bank of New York, as payment
/ for the capital stock, but the Commissioner
charges that the deposit was soon with
4. Ian, IN 20 ~ ~ hn st
was ever actually paid for. After a pro-
| tracted examination OF the companys
/ affairs the department found that on jun,
| IL last its resources amounted to S8,2l9,
and its liabilities, including capital stock.
| to $4,000, showing deficiency Of 500, 1871.
A trial balance taken by the company
! on June q showed resources OF Sl27,4
Of which sll0.540 was given as consisting Of
stocks and bonds. Investigation showedt that
the stocks were sos shar, 8 OF the Fidelity
Title and Trust Company OF Stamford,
carried at &c., $40, ard ,S3G shares OF the
Central Trust Company, carried at s45,sOc'
The Commissioner charges that all OF tina
stock il worthless, and says OF the trial
balance that it is false. elusive and pur-
posely added to deceive and mslead.'
The charge is made that the 500 900
alleged 10 have been paid in for the capital
stock was furnls he'd by Prindle- Weeden
& Co OF New York, a firm controlled by
Imboden and his associates, and that it was
arterwari withdrawn by them and applied
to their own uses. The Fidelity company
of Stamford, the bill says, was promoted by
Leonard lmboden Co. OF New York VINO,
with the Interstate company, undertook
TO undcrwrite and finance it, in return for
which the Fidelity company agreed to
pay commission of 10 per cent. on It's
authorized capital stock Of sl25OOO All
that the Interstate company has 10 show
for this commission is a credit on the books
of the Imboden company,
In charging that the stock of the Fidelity
company is worthless, the bill OF complaint
narrates that a report made by 1t on June v
shows that il had on deposit $4,000, p'ir-
porting to have been made 10y the Following
institutions: Cherokee National Bank $50, OOo'
Farmers National Bank, SIS 900; National
Bank of Commerce, Fort Worth, $4,000.
and New Castle Trust Company, SIS 900.
mo business reasons appear or can be
ascertained," says the bill, why institu-
tions located so far distant from Stamford
should deposit such sums OF money there,
and the same cannot DO and are not or
binary deposits made in the regular course
of business in the Fidelity company
As an example of the methods by which
the deposits of the Fidelity company we're
inflated il ia shown that on Jan 25 there
wa- carried ON the depositors' ledger an
aplarent deposit or credit balance due 10
the Interstate company of S1J,OOO. while
no such deposit appeared on the books OF
the Interstate company TO have Deen
made by il, nor did the books show any
debit balance with the Fidelity company.
II is charged that the pretended deposit
of SIS 900 ana many others Ike II are en-
tircly fictitious. AT the same date there
was carried on the general ledger OF tine
Fidelity company another account with the
Interstate company III which there ap-
peured To q due from the latter 10 the
former balance Of Sl53,sOs, while the
looks of the Ines state company showed
but one account with the Fidelity company,
upon which here appeared To Le due 70 IL
"a balance q! S.03,SOS
Against H.. iabilty for the alleged de-
posts of $4,000 the Fidelity company
Chains TO have had on deposit at the Central
Trust Company, Of which James A. hill,
partner of ImbOden, was president, $4,000
aAd also Il credit of $4,000 with the firm OF
Imboaen Il Co. in New York city. This
firm II of comparatively recent date and the
commissioner charges that ii has no such
established credit as would warrant de-
posi-, of hat sic with it, He adds in the
bill Of complaint:
The said banking examiner has made
ttf,nt TAM . hn mi N N