The Birmingham age-herald., 1905-09-14
Must Find Additional investments.

paying the SUCCESSIVE ihohNS 'A Aii'Noi'
 Must Find Additional investments.
 q ask you, MT. Hughes, and the com mittee to consider that we nave not over s450 000,0 ,0O0 of assets and while we have s1oO,Ooo0oo invested in oonds ana mortgages, we are constantly under the necessity of finding additional investments for our large accommodations of funds. If is a condition which we meet and the exhibits are here which show how we have to employ it. Our investments are such that when MT. Tappan, l suppose about the most widely known and hon ored bank president in his day in New York, died, he left 1t as condition that his trustees should have one privilege and that was to invest in the same securities as those of the Mutual Life Insurance company. That is the way we invested our money. but we could not make the transactions of one hundred millions year in the securities bought by ths company without using syndicates.'
 Made Large PerSsnaI Profit.
 The acknowledgement of personal profits was made in 'tabulated state- ment which was presented to the com- mittee after recess. It shows that MT. Cromwell had made personal prt<t of s2637l from syndicate operations dur ing the last five years in which he indi- vidually and the Mutual Life Insurance company had participated.
 MT. Hughes, chief counsel of the com mittee immediately took up each item of these syndicate transactions in an eff fort to ascertain the manner in which these profits were obtained. An interestlng point was brought out when probing transaction in the Pennsylvania 3H2 per cent convertiables in which MT Crom- well made no personal profit. The wit ness said:
 "Of course we are greatly interested in the Pennsylvania railroad. l might say we are the heaviest stockholders"
 Answering MT. Hughes MT. Cromwell said the holdings of the Mutual Life In the Pennsylvania railroad was $5.Oo0,0OO. Among these transactions the connection of trust companies with the Mutual Life was brought out when it was stated that the million pounds sterling subscription to A Japanese loan was shared by the United States Mortgage and Trust com pany and the Guarantee Trust company. In explaining this relation MT. Crom- well said !:
 Favor Certain Trust Companies.
 "We gave this opportunities to the S'ust companies in which we held for very good reasons. As l explained this morning we, as an insurance company, need very large banking facilities for very Srge interests It goes without saying that It Is better for us to use our own com panes rather than to give to institutions with which we have no connection, the handling of our large Investments For business reasons we put men into the directorate of these subsidiary compa- nies to look after the interests of the Mutual They are not there for the profit or the interest on the paltry 1p shares they have to hold, but to protect the Mutual
 q have 100 shares in these companies as a director, but I have never made any secret of It.
 "The result of our connection with these companies in the last fourteen years we have made through them profit of s16,OO0,000 for the policy holders. If we had not these institutions we should have to turn the Mutual Life Insurance company into a banking institution well as a life insurance corsSany. This we could not do. This being the state of the case. 1t Is natural we should help these subsidiary institutions to make money and should throw opportunities their way. The men we put in them are not there for their own profit They never get dollar out of the Mutual unfairly, and every cent they make through these trust companies and banks for the Mu- tuaI, is for the policyholders and the policyholders alone"
 Have No Joint Accounts.
 Just before closing the inquiry for the day MT. Hughes said:
 we had some talk this morning in connection with another insurance com pany of joint accounts. Have you any of these?"
 "No sir, we have not. and never had" replied Mir. Cromwell. we have no part ners in our investments; that is, any in- vestments we make are made by the Mutual Life, and what Is done for the