Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-05-12
FILL THE PUBLIC EYE
Troubles Of the Equitable At
tract General Attention.
ASSETS NOT IMPAIRED
GREAT RISKS TAKEN BY THE
MANAGEMENT.
Financial Tricks Common in New York
Wall Street Morals Denounced
by a Former Chicagoan.
ASSETS NOT IMPAIRED
BY WILLIAM E CURTIS.
Special Correspondence Of The Star and the Chicago
Record Herald

| Life Insurance Company still occupy a
great deal of public attention. and the
officials of that organization still continue
to wash their dirty linen in the newspapers
to their own discredit and to the serious
damage of the interests they represent.
The disclosures have acted like stroke
of paralysis on life insurance generally
They have shaken public confidence In the
management of other companies, as well as
that of the Equitable and for the time be-
ing the life insurance business Is prac-
tically arrested. Very few new policies
are being written and many policy holders
are refusing to pay their premiums. One
of the general agents of the Equitable told
me last night at the Waldorf-Astoria that
if 1t were not for answering questions of
frightened people and stimulating the faith
of their policy holders, half the insurance
agents in the country might go nshlnS
and stay all summer. An officer of the
Mutual told me that their business mao
fallen off more than 20 per cent; that they
were doing practically nothing; and one OF
the vice presidents of the New York Life,
who is conspicuous figure In financial
circles, remarked this morning that the
business of life insurance had received a
blow from which it could not recover IoI
several years. He believes that the pest
way to restore public confidence would be
to get under federal supervision as soon
as possible, as proposed In bill introduced
in Congress last winter by Senator Dry
den of New Jersey who, by the way, is
president of one of the large life COM
panies.
Confidence in the Outcome.
Notwithstanding this paralytic condition,
there is confidence on all sides that the
Equitable affairs will be pulled out of the
mire and Strengthened all right. 1t is gen.
I1y beIi that the recommendations
of the committee now making an investiga-
ton will be adopted by the board of direct
ors, no matter what they are. The paru-
sans of both Hyde and Alexander Will have
to accept them, because the committee is
composed of five men who have the con-
fidence of the public and of their associate
directors. They are Henry c. Prick of
Pittsburg, formerly of the Carnegie Steel
Company, who is regarded as one of the
ablest business men in the country; Corne-
Illus n. Bliss, who is recognized as the first
gentleman of New York and an ideal citi-
zen; Z. H. Hartman. the banker and rail-
way magnate; Brayton Ives, president of
trust company and for years one of the
most prominent bankers in this city, and
Melville E. ingalls, of Cincinnati recently
president of the Big Four railroad. 1t
would be difficult to select a stronger COM
mittee, or one that would command public
confidence to greater degree.
These gentlemen are going through the
e'iIoAi9 VI lIe COUlpdUy IN a careful and
methodlcal manner and when they discover
the facts they will make a report with rec
concentrations for the guidance of the
board of directors. which will then decide
what action shall be taken to 'mutualize"
the company and give the policy holders
the control of its finances and its manage
ment. The situation is, however, a very
delicate and difficult one to handle "A a
prominent banker expressed it this morn
ing: w men an irresistible force meets an
N n nnn
happen. and that is the situation in tho
q tn case. The Irresistible force is
public opinion. The immovable BODY is M
James HaZen Hyde, who owns a ma ioritv
ba ny rl,o a.och ana can therefore do anything
re pieases IN the affairs of the comnanv
80 long as he stands On his legal rights M
oooy can disturb him. But the Frick cow
mlttee has got to do something tn restnr.
pup , commence and which Is not possible
81 iohs as MI Hyde retains his mower
Equitable Entirely Solid.
Inc Equitable company is entirely so,id
The policy holders are all right. Tho &C.,.
nave not been impaired and have not do
preciated In value. But the disclosures
snow that the management has taken ereat
risks and but for favorable financial condi
lions they might have ruined the connan,,
rortuE"teIy' however, they have not even
injured 1t. 1t will also be necessary 60.
number of the board of directors fo 70
tlfe, because 1t has been discovered or tho
puhIlc mas been compelled to take notice
OF TACT tfat everybody knew before-tbat
Dig private bankers, national bank nresi
dents, railway men, managers of trust com
panies and other large borrowers and stock
and bond dealers have been on the boards
of the Equitable and other companies for
financial reasons. They have used that and
other companies to promote speculation
and sustain enterprises, generally of high
character, perhaps, but involving enormous
risks, which should not have been permit
ted with insurance reserves or any other
trust funds. They are all in it.
1t is a popular impression that the money
which these great companies have received
as premiums and which they are holding
In trust for the benefit of their policy holders
and the widows and orphans for whose
benefit those policies have been issued are
invested in imperishable property-in gilt
edged mortgages and real estate and not
in stocks and bonds which are subject to
speculative influences.
Investment in Railway Bonds.
An examination of their assets shows,
however, that each of the three great COM
panies has been furnishing money to the
four great railway syndicates represented
by members of their boards of directors
as follows:
Cassatt S2a I22 500 So or 900 S25, 92l coo
Vanderbilt. %. 959. 300 1854 900 30, 202, 900
Hartman. "a. AS, 900 $500, 900 lI,1I4,000
Morgan. - l5472,o0O 36o66,0Oo Al 1856 600
So. 3oI 500 500 ,527 900 $40, 252. 900
Thus ii appears that out of the total re-
sources of the Equitable, which amount to
s304.329, 7S4, the sum of $93301 800 is In