The Providence news. (Providence [R.I.]) 1891-1906, 1905-09-29
SCHIFF A WITNESS IN
INSURANCE INVESTIGATION

NohuHutu from phee~Eiknts
A copy of the bylaws governing the
finance committee was identified by Mr..
Schiff
These bylaws provided for an auditing
committee OF five directors. 20 pass upon
all matters. thus depriving the finance
committee OF much OF its power
THE FINANCE COMMITTEE.
list OF five names was handed Mr..
Schiff but he was unable 10 say whether
the men named on It composed the COM
mittee
They were G. J. Alexander, Valentine r..
Snyder Thomas ID. Jordan. william Nc
Intyre and William Alexander
Mr. Hughes said this list was handed
him by an officer OF the Equitable subject
10 correction. Witness testified that the
chairman OF the finance committee an
nualy appointed two members TO audit
the society's accounts and report to the
finance committee, and in that way at
tempted supervision Of the society's
funds.
Mr.. Schiff said that there was prac-
tically no place for the finance committee,
as the executive committee took the in
itiation In all investments and there was
an auditing committee with powers equal
ling those OF the finance committee.
CUSTOM OUTWEIGHS THE LAW.
do | understand" asked Mr.. Hughes,
that in corporations custom outweghs
by-laws?"
In tho Equitable this was the case"
replied Mr. SchifH.
Mr.. Hughes said that he found william
Mcintyre and r. ID. Jordan, members of
the finance committee reported to the
committee In 1884 that they had examined
the securities Of the society and had
found them correct,
Mr.. Schifr said they were appointed by
Mr.. Hyde. the chairman Of the committee.
MIR Hughes said: Now in considera-
tion Of the facts that have been develop
ed at this inquiry. that the Equitable ac-
counts were kept I'm the names OF part
les 10 fhom they did not belong and that
funds OF the society were not entered up
on its books, l want TO find out what
supervision was exercised Now i under
stand that the executive officers had
complete charge OF the society the n
nance committee dealt with the invest
mcnts and sales Of securities only after
they had been made and that with the
important powers to examine accounts
the finance committee did nothing but
appoint two OF the executive officers to
conduct the examination for them?"
The chairman In all committees APP
points these committees" replied Mr.
Schif.
BELIEVES IN HONESTY.
Checks are not necessary II all men
are honest" said Mr.. Hughes.
II have always believed every man
honest until found him dishonest" said
Mr. Schlff.
This has always been my theory and
practice through life"
In reply to a question by Mr.. Hughes.
as TO whether he did not think there
ought to be more supervisor OF insurance
companies. Mr.. Schiff said:
There Is no doubt OF II, but no law
can secure II. 10 you expect every di-
rector to have accountants at his disposal
TO examine the accounts OF every bank,
insurance or trust oompany?'
Mr.. SchH said that he understood that
the Equitable company was exclusively
audited by two OF it's executive officers
Mr.. Mcintyre and Mr.. Jordan-and that
Mr. Hyde appointed them y
MADE A MISTAKE.
Said Mr.. Schiff: II think he made a
mistake because he actually kept a board
OF directors absolutel yat the mercy OF
one man"
During his connection with the society
Mr.. schiff said he had never heard any
! thing OF the numerous trustee accounts
and II was never brought TO his attention
that moneys OF the society were carried
under an account I'm which they did nc /
belong.
Mr. Hughes asked him about his cam.
palgn contributions by the Equitable So
ciety.
Mr. Schff said in reply that Cornelius
~ Bliss had told him that Mr.. HYDE had
contributed to the last campangn, but he
did not know whether II was tho society s
money.