The daily morning journal and courier., 1905-07-10
FRAUD ORDER. IS ISSUED
 AGAINST ST. LOUIS BANK
CORTELYOU ACTS IN CASE OF THE PEOPLES UNITED
 STATES.

the Malls After an InSestASaIloH Dy | the Postal AuthOrfties-MOney of In l stitution Borrowed in Great Sums by l the Promoter for Other Concerns I'm Which He is Interested-PrOmised That He Would Invest Dollar for Dollar Subscribed but Has Not Put in z Cent. Washington, July 9.-Postmaster g. Gen. eral Cortelyou tonight announced the issuance of a fraud order against The Peoples United States bank of St. Louis, Mo, It's officers and agents and D. G. Lewis, a publisher, effective July 9th.
 The action bars the company from the use of the mails after an investigation by the postal officials of the business of the company. The postmaster gen. eraI says: Tt is understood that the funds of the bank which have not been borrowed by MT. Lewis and his enter prises amounting to about two-thirds
 
 posted in banks and will be available toward reimbursement of the stockhold- CTS who number upwards of 65,0OO. It is the intention of the officers of the postoffice department to cooperate with the secretary Of state of Missouri in every proper way for the interest of the investors and depositors.
 The announcement of MT. Cortelyou says that although in early articles of his magazine "Mr Lewis represented that he would subscribe to the capital stock a dollar for every dollar subscrib- ed by all others so that he would own half of the capital stock and that later he represented that he had pledged his entire fortune, every dollar he had, and his publishing business in this banking enterprise and that his subscriptions would exceed a million dollars, the in- spectors sound that MT. Lewis had not co-operated to the extent of single dollar of his own money, although the bank had been in operation seven months, and had paid up capital stock of $2,0000OO" -......5ss.. ......,.,.... 5. gt
 Continuing the statement says:
 'eThe inspectors found that Mir Lewis had made an admission to that effect to Bank Examiners Cook and Nichols on April 3, 1905 The inspectors and their office force in St. Louis made careful checking of the subscription books, finding that on March 15, 1905, MT. Lew is had received and held as payment for shares of stock in the banks S2,2S9,- 043.6f, and had accounted to the bank 994. This showed that every cent Of $2.000,O00 capital stock which had been paid in was paid out of subscription money. received by Mir Lewis from the public and that none of his own money had been invested in the enterprise. Thin was found to be the fact although MT. Lewis had stated in writing to the inspectors that $495,750 of the $50O,OO0 paid in at the original incorporation of the bank were his personal funds. Sub- seauently at the hearing before the as- sistant attorney general Mir. Lewis ad- mitted that that money was recelVed by him from the people and was not his own. Although asked to do so at the hearing MT. Lewis failed to produce any evidence whatever that any of his personal funds had gone into this enter prise. MT. Lewis stated at the hetring that the directors had never refused to make a loan he requested.
 'PThe most important of the represen- tations were that all funds of this bank would be loaned by committee compos' ed of three directors each from the five principal banks of St. Louis, etc.
 f.The evidence showed and Mr. LeWls admitted that hundreds Of thousands of dollars were loaned to himself and his various enterprises, that no con- pnittee of fifteen had been established, hut that the loans had been made prac +ica1lv at MT. Lewis will. On March 15, +he day after the inspectors began their investigation in the bank' MT Lewis placed in it's assets two notes one for $5O,0O0 signed by himself alone without collateral, the other for Sl46'- 375.e3 signed by the board of directors MT. Lewis received no money from the bank at that t1me,t notes being put into the bank to cover money previous 1y expended by MT. Lewis. The last mentioned note, MT. Lewis claimed covered money spent in promotion ol the bank, but as the secretary of state of Missouri declined to allow the item it stands as 8 personal loan to the di' rectors. On March 15 MT. Lewis hat loaned from the blanks funds to him. self and his enterprises 4,6O4.63, the paid in capital stock of the bank ther '. being half million. On March 29 Mhen $2,0OO,000 capital stock had beer paid in, a statement furnished by MT Lewis at the hearing. upon request showed that he had loaned to himsel and his enterprises $907, ,53S.S5. These loans include $146,375.63 to the direct -, ors, $39O,00O to the Lewis Publishing compaay, $346, 163.20 to the Universit! Heights Realty and Development com pany and $25,OOo to E. e. Lewis. A That time MT. Lewis had $43,7 73O of tn banks money invested in stocks ant bonds of his enterprises. The evidence further showed that Lewis had agreed to loan $66,666.66 of the banks mone! on an unsecured note, but was prevent ed from doing so by Secretary of Stat swarger. The University Heights Rs atty & Development company, whicl had borrowed from the bank $346, 1892 and the stock of which to the extent 0 4 1,227 shares MT. Lewis sold to tn : A. t4.nn1y ie Sbaury, +o lava asspts 4.0nsiS St