New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1905-10-05
CALLS KILBURN A CROOK.
~BLEEDTNG" THE CHARGE,
Tice-President Says State Officials
Tried to Wreck Banking Com pany.

Charges that Superintendent Frederick D. XII
snrn Of the State Banking Department and
7,b, = Davies at one time Attorney General,
united 10 defraud the New-York Building and
Loan Banking Company were made yesterday
81 a hearing before ex-Judge Charles Donohue
referee bv Mark s Fustace. second Vice-presl-
dent of the concern According 70 Eustace' MI
burn end Davies were to force it into receiver
shin. name the receiver and his counsel and
bleed the concern and the State for all the
patronage they could get. he testlhed
~ believed KiIburr, was crooked he declared
veheuentlv II believed he after a receiV-
ership for the company. He started an assault
on the company TO take care of his friends.
The hearing before ex-Judge Donohue is only
one phase Of the complicated affairs Of the New
York Building and Loan Banking Company a
suit was brought ny Charles Bacon. formerly A
mariner of David r Hill. to recover $4,000 for
services rendered 10 the company in trying 70
prevent the reoeivership. Andrew Hamilton
-stbar rror1inant in insurance affairs now, also
was retained it developed yesterday AIRED L.
Becker of Buffalo, retained to represent the AT
torney Generals office, is trying TO snow thaI
Rsnon and Hamilton were retained by the
1aansreunent of the banking company, because
they knew tbs concern was insolvent. to exert
political influence to stave OFF the deserved re
ceivership.
r.
ana,per and an employee Of the State Insurance
T1ensr+rnent was on the stand almost all the
afternoon Under examination by Mr.. Becker he
6eolsred that Andrew Hamilton had been re-
4sinAd 70 Took after the AlbanE end of our
troubles" end that later Mr.. Bacon had been
fundamentally after election-to see what
could be don4. His services were considered
especially valuable, not Mr.. Eustace said. be-
cause of his knowledge Of the political situa-
81 nall
ticians but because OF his dealings with cor
poration affairs in Albany. What Mr.. Bacon
did at Albany 70 represent his company or help
Il Mr. Eustace did not know. Mr.. Bacon never
told him.
Interrogation by Mr.. Becker brought out the
admission that although Superintendent Kill
burn disapproved of loans on the divided mort
gage MAN. the concern WAS operated on this
plan. Dir. Eustace did not agree with Super
sintendent Rilburu's judgment. and declared
that that was only one mans opinions" The
books OF the concern show that 1t was sol
vent" said he st took them to be correct. and
believe it was solvent when 1t was thrown INTO
the bands of the recsiver-"
'You have testified that Mr.. Bacon's services
were especially valuable" said Mr. Becker
Were they valuable because he knew Superdn-
tendent KiIburn and some of the officers in the
Attorney Generals office. who, you have said.
were anxious for receiver Mr.. Eustace was
most ernphatio in his denial. Asked to name the
officers he had heard talked about, he refused at
first. Finally he said:
John c. Davies was Attorney General It
had been reported to us time and time again
that he would be counsel for the receiver. This
was lust after the examination by the Banking
Department was begun. Russell Johnson.
partner Of Davies. We were told. to have
some patronage from the receivership- George
r. Skinner sxore he told Senator Aids that
they were after the company and there was
likely TO be a receiver appointed"
Mr.. Eustace saw Attorney General Cunneen
several times he said, with and without Mr.
Bacon. TO find out why his concern was at
tackled
was it your belief that the officers in the
Attorney Generals Office and Superintendent
Kilburn would get a receivership when the facts
did not justify it," Mr.. Becker asked.
Yes, 1t was" answered Mr., Eustace TITS a
long story which I've told in the testimony be-
fore the referee. but I'll tell you again if you
want it, Instead. the minutes of the former
testimony will be introduced Then Mr.. Eustace
said he believed Superintendent kilbTrn and
Mr. Davies were to bring about a receivershp
through some arrangement before Justice Her
rick that they might get ''picktngs.'
Mr.. Bacons employment mystery de-
clared MIR. Eustace, He simply shrewd
lawyer, having experience in representing cor
porations before the State departments, He
-aads no detailed reports. Certainly he never
said he had seen Governor OdeIl about the
affair.
Mr.. Bacon went on the stand a few minutes
TO tall about his visits to Albany where he alb
sorbed Information from no one in particular
shout the attacks" the banking company
and ths contemplated reoefvership On one
visit he said, Mr.. Davies told him that he'd had
reoefverEhIp lying IN his desk since spring and
he supposed he'd have to talks action on it be-
fore he went out Of Office.
The hearing VIII be continued next week