New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1905-12-22
Mr.. HENDRICKS ON STAND.
Continued from first page.

N.-A
s.-sed by Ex-Governor Oden. Miss Kate Hen
s~,oks was q personal appointment None OF
xasa e7pointees Mr.. Hendricks believed. had
.r been connected with insurance companies,
-. bs die recall the relations to insurance cor
.,-stious of William H. Buckley, who soon left
80 5snartment and became attorney. appear
&c for the Prussian Life. Mr.. Hughes tried
.,r long time TO find out why law forbidding
= company OF any country which excluded
american insurance companies to do business in
.he state had not been enforced. Mr.. Hem
s,ots thought there never had been any de-
rand for its enforcement
ur Hughes then inquired what were the de-
...,,,ning factors in deciding investigation of
:, insurance company by the department The
---,,sI statement, Mr.. Hendricks testified, was
,he main guide
Then followed rather striking admis-
s,ons First, Mr.. Hendricks said that he had
NJ recollection of any action ever taken or any
.,ui-v ever had to protect people from de-
osntive circulars of insurance companies Then
he declared that his actuaries had never re-
r,red any comparison of actual results of es-
;,,ates furnished by companies, nor had the
ssnartu1ent ever exercised its veto power over
,se use OF policies. Subordinates dealt with
,bis subject and the witness was unfamiliar
with il The next assertion was that the de-
,ertn,ent had never exercised any control over
she amount OF advances to agents. In fact. as
" Hendricks added in his testimony, sol
vsncy' alone had been investigated, not man
sr,ment This was left to the officers of the
company.
Mr. Hughes summed this all I'D with the
question:
well is 1t fair 20 say, Mr.. Hendricks. that If
,ns department. was satisfied that the company
vas solvent it paid virtually no attention TO
the question whether the management Of the
company was economical extravaganza"
Not unless they were likely to impair the
solvency.' the reply.
We'll if the company had surplus of say
s40OoOO0o or S5O000Oo0 then it would make
m difference TO the department how extrav-
sZant it's management was?"
DIRECTORS SHOULD MANAGE"
at don't think-since have been there have
never tried to manage the companies. and 1
don't believe il would be wise for the state 70
manage the companies: that should be left 10
the directors of the company.
The examination on this point follows:
Odd you not think it proper. in order that
remedies might be invoked. that exTavagance or
tsntion Of the proper oficer OF the Slater Ayes.
QSB s0t' did You you look for then7 A-well as
said we had never found them. 1t would be al,
os impossible to find them T Fbs sa an e De- e1
ps~tnent is TO undertake the management the only
hey p SSRa TO 1po On my he SRp oeTs undef
don't think you could IN any way manage
t5%You don't ascribe as much virtue as do
to Bt mini W HctT th Mau GdpPb, 3. 6Ss %Gd0 but ut
what am going TO say is this: what you i Haev
don't believe that you can make men honest by
any amount 81 eHslna0n Il gou ouIG uaRs
the banks honest They have two examinations a
EeaT ano Of dsbonesty that is inside is really more
than you have thought OF IN TINS orIs Of the
CT is great a,d h0weves to f hazs an 81 e1
think that does good oaa Sauna
thing OF check7 A-There is no doubt about II
ond the more s ey i is t that less fsH IT Is
ss e<P Pose Il be dshoDesy managed? A-Yes
May / talk just minute. Mr.. Hughes? .-,o,,s
tSiiy- MI. A HenoricEs WY. we viii take the
RutabIe Unless we had had help ron the m6
moi have got il from The books because it wasn't
e 5as 70 have got It II We through
ss exsnsa n5at Il e Would discover very little
Unless We had inside men that were helpful,
and don't D61e s 6b that oath Et With Authority If p1 to
examine records and vouchers. with authority to
5 an yon Would np not be in position detect
and expose irregularities? A-Oh' some OF theln'
o-Now. the point I was driving at was this:
powers and whatever may be thought Of your
ability 20 use them to adyantage' you nave , nor
some specified irreguiarity was brought to your at
animation
THE SYSTEM INHERITED
Mr. Hughes searched through the long list of
extravagancies of the various companies to find
some knowledge about such things from Mr.
Hendricks but found little. He had never
known Andrew c. Fields the size of Mutual
Life salaries or the facts concerning the supply
department TO which yellow dog" expenses
we're charged He did not have any strong con-
yiction that the department had any duty In
this line so long IS the solvency OF the com
panies was maintained. Then came the frank
statement that the system Of examination was
Inherited by him as q tradition Of the depart
ment and observed. Moreover, for the discovery
Of such facts he declared his force inadequate.
The examination Of the New-York Life In 1904
was cited MI Hendricks had left this entirely
10 Nj Eanderpoel, who had reported no fTegu-
larites or extravagancies such as the committee
has unearthed. The 100000 payment TO Andrew
Hamilton was revelation for Mr.. Hendricks.
Mr. Hughes thought it curious that the New
York Life should report its expenses in detail
10 the Prussian government and lump them in
the State report. This detailed report showed a
payment Of So. 900 to Andrew Hamilton in 1898
Asked what he would have done if this had been
called to his attention. Mr.. Hendricks contented
himself with the smiling comment:
Well lawyers come pretty high"
The year end loans. Of which so much has
been brought out at the investigation, were then
discussed. The various loans 10 clerks In hunn'
Loeb & Co.'S Office by the Equitable were cited
But Mr.. Hendricks had left this TO Mr. Wander
poel, and his investigation had never revealed
the facts Mr. Hendricks declared he had never
had any suspicion of the yellow dog funds and
acknowledgements