The semi-weekly messenger., 1905-09-19

and One Witness Examined.
New York, September 14.-When the
special legislative committee probing
the life insurance companies methods
adjourned today, Chief Counsel Hughes
had finished for the time the examina-
ton into the Mutual Life Insurance
Company, and the Metropolitan Life
Insurance Company was started on
when Silas B. butcher, director and
a member of the finance committee,
was called to the stand
Mr.. butcher was questioned regard
ing the securities held by the Metro
politan, and as to the syndicate opera
tions Of his company
He was asked the salaries of the
company's officers, but he could not re-
member them. He will present the list
of officers and salaries to the commit
tee tomorrow. Mr.. butcher was still
on the stand when the committee ad-
journed.
we'll had been on the stand to continue
his explanations of the Mutual Life's
syndicate operations In explaining
the relations of the Mutual with trust
companies, Mr.. Cromwell stated the
interesting fact that on the purchase of
S1,12O,OOO shares of the Total Guar
antee and Trust Company, the Mutual
had received in dividend S1,22O,OOO
making these shares cost nothing and
realizing a profit. Mr.. Cromwell
stated these shares We're now selling
at over 600.
One advantage Of dealing through
syndicates in preference to buying
railroad bonds direct, Mr.. Cromwell
said he had actually tried to \buy
bonds directly from a railroad COM
pany. He went to his friend, Stuyve-
SAINT Fish, president of the Illinois Cen
trail railroad. Mr.. Fish told me he
could not afford to sell bonds to the
Mutual" he said.
"Then the truth is that the railroads
must stand in with the bankers in or
Ger to sell their securities and the in
surance companies must stand in with
the bankers in order to buy at low
prices!' Mr.. Hughes asked.
Exactly"
THE bankers control the situation?''
mo doubt of that
In his testimony after the recess, in
explaining the matter of the purchase
Of the Bank of California stock, Mr..
Cromwell said the issue price of the
stock was $50. Mr. Cromwell hoped to
get the shares at this figure, but in the
end the shareholders, to whom under
the California law the rights to the
rev issue belonged, held out and the
Mutual obtained it's 5000 shares at an
average price of $50 $40 The sale
was entirely by individuals, and there
was no syndicate.
The transaction was left entirely to
William BabcOck with absolute conf
dence that he had been dealing fair
with the Mutual.
Mr.. Hughes asked how the increases
or decreases of bank balances were
controlled.
Il control them," said Mr.. Cromwell
He recalled that in one instance he
added S1.OOO,OO0 to the deposits in the
Guaranty Trust Company because the
trust company needed the money for
a special purpose. He could not re-
member what was the special contin-
gency, but he promised to look up the
records and disclose it.
The advertising, printing, station
cry and postage accounts of the Mutual
rs S1.134 S33. 76: of the New York Life
it is SS51, ,2S4.6S, for the Equitable
SII2,6455O. Can you explain these
very large amounts?''
Il know nothing about it. Current
expenses of the Mutual are under a
special committee"
rs this true that the legal expenses
amount TO the sum Of 1864, ,254?'
Il have nothing to do with it. 1t
would be under the law department"
1t was at this point that Mr.. Dutch
er was called. While his testimony
developed nothing of startling or
sensational nature, several statements
made by the witness were of passing
interest
One of these was that the company
has no treasurer, the cashier acting in
that capacity.
OF S75.OOO.OOO of the securities held
by the Metropolitan, about S65,OOO,OOO
We're purchased from Vermilye and
Company. and W. A. Reid and Com
pany. The reason, Mr.. butcher
thought. why so great an amount of
business was done with these firms,
was because. they have done business
satisfactorily aad the company deemed
it advisable to continue with them.
Mr.. butcher said the president usually
did the purchasing of securities for the
Metropolitan.
II appeared from the Questioning
that the president of the Metropolitan
had discretion in which banks and
trust companies deposits should be
! kept.