The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1905-09-20
BIG BILL AGAINST
MERCANTILE TRUST
That Company Asked to Return Return
$71s,ao4-Collateral Given for
Loans Found in Some Cases
Proved to Be Of But Lit
tie Valuc-Turner
Loans.
(BY Assoclnted Press.)

NEW YORK, Sept. 19.-'That the tauit-
able Life Assurance Society, paid out
s2ls2Ci to the Mercantile Trust Company
IT. connection with certain loans, known
as "the Turner loans, and that thcso
payments were without authority, 70
far as the records of the society dis
close, became known to-day. When Paul
Morton. president OF the society. mace %
public report on the subject, SUD
mit,cd BY hrm TO the socc,y's directors. e..
These transactions occurred IN VIVA 7
MIR. Morton refers 10 as the Iurner
loans.'' These Mr.. Morton's report sets
forth were carried in 1894 by the West
ern National BanlQ which was con
trollcd by tho Equitable Life Assurance
Eoclety. The collateral for the loans was
y objected to by bank examiner, and
Henry B. Hyde then agreed to trans
fer The loan and collateral 10 the Mer- t'r
camille Trust Company. AZ that time,
apparently tile loans amounted to $66l,
4Nl George v. Turner, IN whose name,
the loan stood was secretary to Louis
Fitzgerald. then president OF the Mer-
camille Trust Company and a "a close
business associate Of Henry 3. Hyde.
The loan was guaranteed by Marcel
lua Hartley. John Il. Scarles, Louis
Fitzgerald. w. n. Coler, Jr.. and II. B.
Hyde.
The Loan Grew.
On March 81. 1895. the same Euaran-t
tors renewed their guaranty. the loan
having grown 10 sl,27647S. the Increase
being due TO attempts 10 develop the
property on which the collateral for
the loan was made. Part OF this collat-s
efal was given by John w. Young and,
consisted OF Salt Lake ant Eastern Rail
way stock and other Salt Lake stocks
This collateral proved he OF little.
value. Other collateral consisted OF con-
tracts OF tho Kentucky Mineral and Tim
her Company and the An1ity Land and
Irrigation Company. ofColorndo. Attempts
were made to develop the Kentucky
property and the Colorado property and
large sums were expended for that pnr-
pose. and by July /, 1905, the cost Of
the Kentucky property stood a. sdl9, ,067,
and tho Colorado property at s2,s0s.e3s
The Equitable Life Assurance Society
paid the Mercantile Trust Company
$2ls,264 on these loans on January g.
1860 and 100000 on February 4, 1901.
THE records OF the society,"" said Mr..
Morton, disclose no authority whatever
for these payments. and the cash en-t
tries in respect to them were very OBJ
scure." s.
MIR. Morton also sets forth that on
February H. 1900. the Executive Com
mittee OF the Equitable Life Assurance
Society passed n resolution authorizing
the president to convey to the indiviuual
guarantors OF the Turner loans the as
surances OF tho society for their protec-
ton. On Februaryl14, 1900, the president
of the society. Mr.. Alexander. made a
statement that these loans were made In
the interest Of the society and assured
the gunrant0rs that the society would see
that the amounts their companies loaned
would be repaid with interest.
Equitable Not Responsible.
Mr.. Morton referred the matter to spe-
cial counsel who have assured him that
the Equitable Life Assurance Society Is
not responsible for the loans. Mr.. Nor
ton has also notified the Mercantile Trust
Company that he will expect itlto repay
the $71s,a4 paid to 1t by the Equitable
Life Assurance Society.
Mr.. Morton found that s2GS000 WAS paid
by the Equitable Life Assurance Society
TO the Mercantile Trust Company on the
$6s5, 900 loan, the nature Of which loan
has never been explained. Counsel have
been Instructed to begin proceedings for
the return of this sum. This loan was
carried on an account known as tho
"J. w. A., No. 3. account MIR. Morton
also reported to the directors that It
would he necessary to charge off ss6,4oS
,,npaid balance of a loan to JltH II,
searles, who has gone through bank
ruptcy. The collateral against this $780,
4ss, Mr. Morton declared Is without
value.