New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-04-26
WANT 1T ALL IN JERSEY.
GLOBE SECURITY CASE.
Hoo RothSchiLd Got Collateral for
Federal BaRLc Sale.

NJ Waite yesterday IN the United States District
Court, n explanation OF the absence OF Miss
Catherine Heaney. OF No s63 Sackett-st- Brooklyn.
cashier o. the company. presented certificate
from DR.. Francis J. Magilligan. OF No. lS5 Bergen
st. Brooklyn, saying she Was too III TO appear IN
court This led 10 adjournment OF the motion TO
show cause why Miss Heaney should not be pun
ished for contempt OF court In refusing TO open the
safes of the wrecked company. which are supposed
10 contain records and funds on hand al the time
OF the collapse. There are seven safes stin IN
opened.
samuel J. Goldsmith, as the representative Of the
pattioning creditors asked permission to oppose
the motion made on Saturday 10 dismiss the pet-
ton the ground that the security company was
subject TO the bankruptcy laws The request
granted.
Counsel for Miss Heaney said she would will
iugly open the safes IL she could remember the
figures OF the combinations.
Judge holt appointed Dr. Neil McFadden. OF NO.
q West Fortieth-st.. TO examine the woman.
Potts and Higgins the New-Jersey lawyers OF
the Globe Security Company. appeared before
Judge Holt with an order to show cause, signed
by Judge Thomas. why the involuntary proceed
ings here should not be set aside because original
bankruptcy proceeding is pending IN the courts OF
New-Jersey. Il was urged that the actions should
DO consolidated TO save expense and because the
company was a New-Jersey corporation and Its
affairs there were in charge Of Receiver Black MI
Potts said thai the assets Of the corporation were
in New-Jersey being held under seal in the vaults
or The commonwealth lFlSl Aoulpalg-
For the petitionlng creditors IL this jurisdiction
MI Myers contended that the court here had
jurisdiction. and asserted that the motion made
by Potts and Higgins was premature and should
not have been made until there was an adjudica-
ton. lie urged that here where the assets OF
the Globe company must be distributed because it
here that the sole business Of the alleged
bankrupt concern was conducted.
Judge Holt reserved decision and gave the law
yers till tomorrow to file briefs
YES eros
completed his examination Of the papers found IN
David Rothschilds apartment st the Ansonia and
said he thought they would make II plain that
RothschId was connected with the Globe Security
Company. Some OF the papers were circulars Of
the Globe SAurity Company printed in French.
German. I'd f. and English. telling of the ad-
vantages OF The company, its large and sound
capital and thorough methods OF doing business.
Desk mats lSxlS inches large and small letter
openers, pocket books and calendars OF all de-
scriptiuns were given away advertise the
psny. Through the East Side the Federal Bank
distributed packages OF needles. large and small
There was q picture OF the bank the outside Of
the packets and quotations in Yiddish end English
Mr.. Kresel said that firm had opened
Office in the Federal Bank Building. 40. $50
Broadway. under the name OF the Merchants Dis
count Company. The circulars sent out by the
company showed that its purpose 10 discount
outstanding accounts Of merchants. Little or no
business had been done The letterheads asserted
that the capital OF the company was SLo6o0e. The
president was given as Robert A Dooittle. Doc
little was cashier OF the Federal Bank
Mr.. Kresel said that among the papers were
letterheads Of the firm OF y. Rothschild & Co.. bank
ers at No SO Broadway. In one corner Of the let
terhead was United States, Municipal Steam and
Electric Railroad Bonds" And ia the other
ner. Investments Tor Trustees and Savings
Banks"
Evidence was found. according 10 Mr.. Kresel
that President William Muirhead, OF the Globe Sc
curity Company made daily reports 10 David
Rothschd Of the preceding days business tell
ing who did and who did pay their notes. one
such report was found. dated February .
In letter dated January 4, 1905. addressed to
David and Louis Rothschild.'' and written BY
Louis Haase. eX-president OF the Globe Security
Company. he said he wished the Messrs. Rothschild
10 discontinue his name president and director
OF the Globe Security Company, that he had only
lent his name and Gid not wish TO continue his
connection with 1t in any way
A letter was found dated February ., from Pres
ident Muirhead 10 David Rothschild. in which he
rendered his resignation to take effect on April
last
As evidence that the Federal Bank making
q bid for rural business Mr.. Kresel showed a
circular addressed 10 Farmers and Rural Peo-
Mr. KreseI said that Lac case would probably
60 before the grand jury to-day.
by David Rothschild with George L. Montgomery.
who is in the real estate business at No. l44 Mon
estate worth $4,000 on notes. II appeared that
ROthSchlld made the Brooklyn real estate deal
carry out the transfer OF his bank 70 William
~. Woods, the Brooklyn banker. The deeds 10
the Brooklyn property were wanted by Roth
Hchild 70 deposit in the vaults OF the Federal
Bank 70 satisfy the demands Of President Woods
for sound collateral for the notes with which
Roshschid stuffed the safes % the bank.
AIr Montgomery. who is with the Mortgage and
Realty Company. T. understood 10 have sold the
property 70 Rothschfld for $4,000. 10 be paid in
monthly payments OF 81 900 each Rothschld gave
twenty-five S2loOo notes, with mortgage on the
property. which was 10 be cancelled when the
last OF the notes paid. Rothschild, by means
OF this ceal put IN possession OF deeds TO
property worth $1,000. II thereby possible
Tor him 70 make q showing Of collateral, although
the deeds were not worth a cent 70 him until he
Alr. Montgomery gesteroay through counsel.
trying 10 make some ARRANGEMENT with the
receiver OF The Federal Bank. where the deeds
are deposit Il was not known whether
he contemplated bringing any proceedings against
Alexander Karst counsel for creditors OF the
Federal Bank. said that OF the larger cred
ttorS met yesterday TO organize. Il could be
solvent and the report OF the hank examiner was
awaited with great deal OF interest. Mr. Karst
had heard from 2s2 creditors. One Of them
Samuel Shall, q No. 16- East Broadway. who said
business and engaged to be married when the
bank went up. He not only lost mis- money but
his girl too. She returned his presents. which
he was afterward obliged 10 pawn. According to
Mr. karst. Shall talked yesterday about jumping
OF the BROOKLYN Bridge. he felt rriSera bic
Il reported in banking circles that the sus-
pended Federal Bank might resume business again.
Recently. Il said. and responsible in
terests had been looking over the field. and had
decided that with new management and methods
be revoked.