The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1905-10-06
INSURANCE GRAFT
AR0USES EUROPE
Germany Likely to Exclude Big
American Companies Other
Countries May Follow.
STATE DEPARTMENT
IN AWKWARD PLACE
American Government Urged Big
Insurance Companies on the
Kaiser as Safe.
journal Special Service.

Washington, Oct. 6.-Revelations of
bribery and corruption in the insurance
companies of New York, which have
been made by President Mccall, will
lead, in all probability, to the exclusion
of these companies from Germany and
perhaps other European countries.
1t was learned today that in comph-
ance with instructions from Berlin the
German consul general in New York is
which is being obtained in the New
York state investigation. Consular
reports of other European powers in
New York also are advising their gov
ernmsets of the developments. Upon
reports submitted by these offices Ger
many and other countries may take ac-
ton.
The exclusion from Germany would
mean tremendous loss to the New
York Life, which has in force in that
country insurance amounting to mill
the business of the company in other
countries, because Of the stigma cast
upon its reputation, even if those coun-
tries should fail to exclude it.
Hits State Department.
The state department has been placed
In a rather awkward situation as re-
suit of the disclosures in New York
For years 1t has been persistent in its
efforts to induce foreign governments
to authorize American mpanies to do
business within their territory, assert.
ing that the companies were sound and
safe and that their business admins
tration was honest and in the interest
Of the policyholders.
Upon these representations it usually
has followed that companies have been
admitted to countries in which they
wished to operate. The New York In.
s s4a4a company for.exam BE, gays. the
s1ate department a fRs gfea a9s Of Of troy
Equitable were excluded from Prussia
IN 1895 for failure to conform to Ger.
tain stipulated methods. 'S. 80 . >
Department. Protested. -
The department protested against the
exclusion, pointing out that in the case
of the Mutual Life, it had established
main branch in Berlin, invested
100000 in the purchase of building
and had incurred large expenses il
other transactions incident to the open
ing of large business in a foreign
country and, that in, complying will
other requirements which had been i'm
posed, it made deposit with the Prus
sian government Of 100000 worth O.
Prussian bonds, representing more thai
one-half of all its receipts from Prus
sian business.
Year after year the government
urged upon the Prussian government t.
revoke the decree of exclusion agains
the company. During the later stag
Of the negotiations the New York Lif
admitted it had been impossible for
to comply with the Prussian regnla
tions, but insisted that it had mad
changes and improvements in its ew
system Of operations and that it the
could comply with every point.
Germany at Last Yielded.
The result Of the negotiations wa
the dispatch by Germany of two Of
fcials to New York to confer with tn
heads Of the Mutual, Equitable an
New York Life, which would enabl
them to resume business in Prussi:
These officials returned to Berlin wit
favorable report upon the New Yor
companies, and immediately tbereafte
the New York Life resumed business i
Prussia. It was a friendly thing fc
the German government to do, and
was made in the face of oppositio
made by the home companies who ha
counseled the government in the cha
acter of experts.
1t Will be an extremely difficult thin
for the United States to interve1
again in behalf of the New York con
panies, in view of the confession Of i
Irregularities and wrong doing which hi
been made by President Mccall ar
other officials of the New York Lii
and the Equitable.
Deem Stability Injured.
It is understood that the consular o
icers who have been instructed to fl
low the proceedings have not attacht
particular Importance in their repor
to the statements that money had bet
contributed to campaign funds in 199
1900 and 1904. ...t
Revelations in regard to the meth,
pursued in the transaction of bushes
the Juggling of the money Of the pl
icyholders, and the character Of i
vestments. according to information I
ceived here, injuries, in their opinio
the financial stability Of the comp
MES +. 49,.
It will be upon these grounds, al
not because Of any hostility to t
: United States, that their governmen
will act,. if they act at all. 1t is sa
here that nothing will be done until t
investigation is concluded and the f.
extent of the corrupt practices viii
have been followed has been brought
light.
NEW STAR rs DISCOVERED.