New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-04-19
USED B. F. TRACY'S NAME.
ROTHSCHILD IN TOMBS.
The Globe Security Compan Goes
into a ReceiCer's Hands.

Following the arrest Of David ROthschId, eX-
president Of the Federal Bank. on Sunday and
an involuntary petition in bankruptcy filed yes
.erdav morning against the Globe Security Com
many. with which Rothschild was connected, IL
was learned that the name Of General Benjamin
+. Tracy. ex-Secretary OF the Navy, and now
OF the well known law firm CT Coueert Brothers,
was appended 10 some OF the companys pros
p-ctus circulars. sent broadcast through ne
mails The United States government, through
the Postoface Department, is now investigating
the distribution OF such literature.
ssThe company has 80 Tar apparently paid the
interest on its bonds" PostofIice Inspector Ashe.
Who tlss been investigating the conpany's meth
oas for several days told Tribune reporter.
.'but now a bankruptcy petition has been hled'
we EXPECT the complaints VIII come in and we
shall be able 10 act Until then We have not
sufficient evidence"
He Was seeking William Muirhesd. the treas
urer OF the company. but Mr.. Muirhead had ap-
psrently not been at the ONCE at No 100 Mas
Eau-st. since early morning. Through the malls
the company has circulated its advertising mat
ter all over the country, particularly advertis-
rpents relating TO gold 8 and per cent bonds
described as good as government bonds The
advertisements purported TO show that its casn
and surplus amounted TO SlO75'oo0
GENERAL TRACY WAS LEGAL ADVISER
At his law Office. No. Il Broadway. General
Tracy yesterday admitted that he had allowed
the use Of his name the circulars when they
were first sent out. but he declared that some
six weeks ago. when certain newspapers pub
lished facts which seemed TO place the company
sn an unfavorabe light he Immediately severed
his connection with the company as advisory
counsel and in every other way.
About a year ago. John W. Wooten. the COM
panv's attorney" General Tracy said. asked
me IN return for slight compensation, II I would
set as his adviser in legal matters for the COM
pany. I knew nothing about the company, but
knowing Mr.. Wooten. had no reason 10 believe
sts methods were other than strictly legal and
proper"
You understood. however. that the business
methods and rates OF interest were strictly law
ful2"
L have no reason 70 believe otherwise.
was told the company's business was TO lend
money on bills OF ladng. life insurance policies
and personal property. With fifty years ex-
perience. I naturally assumed that commissions
were paid TO persons who succeeded in negotiat-
ing loans. I presumed the business was en-
iirely reputable. New-YOrk businesses go.
J therefore consented TO act advisory coun-
SCI. and permitted my name TO be used on the
first circulars that were sent out. During the
opening part Of the litigation in which the COM
pany was involved the exact nature of which I
DO not remember. but it was strictly legal mat
ter, recoIIect, represented the company. but
could not continue with the case. as I had TO
30 TO Alabama never guaranteed its mort
cages or Endorsed its loans"
You had no suspicion that the nature OF the
circulars might not be entirely legitimate?''
Naturally not. ] knew the lawyer and as
sumed that everything was right"
General Tracy said he became slightly ac-
ouainted with Mr.. Rothschild at the time Of the
litigation. About March l." he said, articles
which read in certain newspaper made me
think that possibly the company not quite
it should be. I at once, without explanation
Of my motive severed my advisory connection"
BANKRUPTCY PETITION FILED.
The involuntary petition in bankruptcy was
filed against the Globe Security Company by
James s O'Neale Ascher Osterman and Samuel
J. Sewen- The claims. which are based on three
notes. aggregate 5000 with interest. O'Neale
alleges that the Globe Security Company has
defsuIted on pronissory note for 5000 dated
March il. 1903, and payable FIVE days after de-
rnand; Osterman's note. which is for $1,000.
dated January Z. 1904, was made payable six
months after demand. and SewelTs note for
81 600, dated December H. 1903 was also pay
able six months after demand and there is now
alleged to be 500 still due him that note.
James McKeen has been appointed temporary
receiver of the Globe Security Company the
petition Of James O'Neale and others The re-
ceiver's bond placed by Judge Holt at
$4,000 Mr.. McKeen was furnished with
order placing him IN charge OF the business OF
the alleged bankrupt corpora ton and restrain
ing anybody from interfering with him in the
discharge OF his duties.
i am waiting for the creditors attorney to
file a 81 0oO bond before taking charge and so
FAR have made investigation whatever" said
Nj AcKeen at Mr.. Muirhead's Office yesterday
afternoon One who said he was Mr. Muirhead's
attorney declared that Mr. Muirhead
pected there at any time. The attorney declined
20 furnish Mr. MUirheads home address.
TO INVESTIGATE GLOBE COMPANY.
Samuel J. Goldsmith, attorney for the bank
rzptcy petitioners said last night that an order
commanding Rothschild and Muirhead 20 appear
and give testimony in the Globe Security Com
pany's bankruptcy proceedings had been signed
by Judge Holt. The date Of the examination he
said would be at the discretion OF United States
Commissioner Alexander. Mr. Goldsmith said ne
had been told that similar order had been
Issued by the Chancery Court in New-Jersey,
under whose laws the company incorpo-
rated The New-Jersey proceedings. however,
he said. will in any case give way to those
OF New-York"
Il believe" declared Mr.. Goldsmith, that the
coTnpany's Indebtedness will amount 10 fully
100000. The directors transferred their
mortgages 20 three trustees"
David Rothschild, before leaving Police Head
quarters yesterday morning, had his photograph