The Montgomery advertiser., 1905-08-26
IT COURTS AN INQUIRY Equitable Joins With New York State. INVESTIGATION Is ASKED Many Admissions Made by
 the Company. Improper and Illegal Acts on Part of
 Some 0mcials are Acknowi- edged~-As to Blame for s- the Scandal.

Tor fpil investigation In court or us directors and officers and their alleged ! wrong doing In managing the moneys of the Society. The document which announced this determination was the | answer of the forty-nine Equitable di-
 rectors to charges made against them | in connection with a suit brought
 against the Equitable Life Assurance | Society by the State This answer was ] filed with Attorney General Julius M |. Mayer.
 Admission Is made that some off, cials of the Equitable have been guilty ! of improper and illegal acts. In all thirteen charges are answered ! by the directors Among these an- swers they admit the $250.000 loan to l the Depew Improvement Company. They admit the seS5.0e0 loan of the Mer cantiie Trust Company. but waive re- sponsibiiity fin this loan so far as the board of directors is concerned. and in dicate Messrs. Alexander. Jordan and Deming as the persons having the most intimate knowledge of these transac- | tions. The charge that excessive sal aries were paid to officers of the Equi- table Is not directly answered, but ad- 1 mission Is made that, under guise of | salaries, excessive fees were given to
 certain Equitable officials who were also directors in other companies. In defense the answer states that these practices were not known to the whole | board of directors.
 Outlining their belief as to the best policy to pursue in fixing the blame for the Equitable scandals |, the directors say, first, that the blame for alleged cases of misconduct will be found to rest on individual officers and not upon the directors as a body. Having made this explanation the answer then ad- mits in a general way the wrong-doing charged.
 A Specific Reply.
 The first charge specifically answered Is that premises on Broadway were let at inadequate rental to the Mercantile Safe Deposit Company. This is admit ted, but it is denied that at the time this lease was made James H. Hyd }, Janes W. Alexander. William Alexan- der, Gage E. Tarbell, Valentine P. Snyder. Thomas D. Jordan, Charles B. Alexander, Henry R. Winthrop. Alvin Krech and W. H. Mcintyre were stock holders and directors in the Mercantile Safe Deposit Co.
 With certain reservations, admission is then made that the capital stock Of | the Missouri Safe Deposit Co.,. was ac- quired by the Equitable Society, which paid $250 per share for shares of par value of SI00. The reservations in fa-
  with this charge. include a claim that these allegations are true in respect to certain of the Equitable officers. but that the alleged purchases were never known to the whole board of directors As to excessive and unwarranted loans to agents. the reply admits that they were made. The directors furth- CT admit that the officers who permit ted lvvastemul, improvement and improT CT advances of money to agents may have been guilty of grave errors of Judg ment. but assert that they have no in- | formation sufficient, to form a belief that these officers were knowingly guilty of such improper acts. 1n- stances are mentioned in which the sys' tenn of making advances to agents is necessary and proper, within reason able limits.
 The consolidation o fthe Western Ma l tionaI Bank of New ork with the Ma tionai Bank of the United States oi New York. by which money loss re- suited to the Equitable society and g | profit to some of it's directors, Is also admitted; but the directors say that | the responsibility for these losses mus | be divided among those individual de l eendants who directly participated In or had, or by reason of their oflcia l duties and position, should have had
 knowledge of the transactions" | True Statement. .
 The tale of alleged improper Salar les to Equitable officers which wal embodied in the states charter. is de clared to be a true statement of thu figures. A direct admission is theI made on the subject of pensions and C
 out sufficient vouchers or audit. bu
 the directors say their opinion Is re
 served as to whether such sums wer' large and in all eases unwarranted.
 Admissions of greater latitude ar made on the ubpect of pensions and {, the charges that money under thu
 guise of fees was received by director
 and stockholders who were simultane
 ously ofiicers of the Equitable ant
 other corporations.
 After admitting that these money
 were received as charged the repl! states
 Many of these defendants were ig Inorant of said transactions. whicl lweFe not of a character necessarii!
 known to the whole board of direc tors"
 Further on the report states "som
 of said pensions were found to be jus ltifiable. others excessive and some i'm IpfopeF"
 Denial is next made of any knowl edge of information sufficient to forn
 a belief concerning the payment of at
 torney's fees which were disproportion ate to the services rendered.
 Taking up the s6S5.000 loan of th'
 Mercantile Trust Company. an admis
 sion of it's existence is made but tn directors deny that they admitted thi
 transaction and say:
 This transaction was never befor this defendant board of directors and
 as this defendant Is informed and be
 lieves. was known only 10 the defen
 dants James W. Alexander. Thomas D
 Jordan, Henry c. Deming and per
 haps to a few others of the individua
 defendants whom we are at presen
 unable to identify.
 ''As this defendant Is informed tha there are certain entries in some O
 its books which do relate to this trans action, but as such entries are obscur
 and unintelligible, except to those wh'
 were eognizant or had participated fl the trancastions referred to. this de fendant denies that 1t became in an, way bound to pay to the Mercantil
 Trust Company the sum of $6S5,00O O
 any part thereof"
 The Payment Admitted, Finally admission of the payment o
 this S6s5,O00 to the Mercantile Trus lCompany on July 14 last is made, bu 1t is stated that this occurred onl
 after the trust company had asserte
 R claim against the Equitable and af ter this claim had been resisted an
 disallowed by the present managinl , officers of the Equitable Society. The $260,O00 loan to the Depew I'm , lprovement Company is next admitte with a proviso which states that thi admission Is restricted to those c tfhe individual defendantB who were. Q