The daily morning journal and courier., 1905-12-22
ONLY EXAMINED AS ID
 COMPANIES SOLVENCY
TESTIMONY OF NEW FORK STATE SUPERINTENDENT OF
 INSURANCE.

No Investigation of the Department to
 Ascertain the Extravagance of tho
 Management of Company or Into
 the Salaries of Oficers-EmpIoy1nen
 of KiHspeopIe Even Not Inquired
 Into-Afemory Fails Him When it
 Comes to Legislation He Might Have
 Suggested
 New York, Dec. 21.-Francis Hen dricks, superintendent of insurance Of New York state, was the chief witness before the legislative committee of in- surance investigation to-day and tes. tified that the examinations of insur- ance companies by his department ara mamde to ascertain only the solvency or the companies, and that no inyest5- gation Is made into the extrayagance of the management of a company, or into the salaries paid to officers, so long as the company is able to pay it's obliga- ttons. No investigation is made into the commissions paid to agents. the system of loading on the premiums, the IS. to directors. The employment of kirls- people of officers in high positions is not inquired into. This has long been the custom of the department, Mr Hem dricks said, and he declared further that he personally knew little or noth- ing about the various exaninations made, as they were entrusted to Isaac Nanderpoel the chief examiner of the department
 While MT. Hendricks memory failed him as to any legislation which lie had suggested as a remedy to any defects in the laws governing insurance com panies he stated that no measure that he had ever presented had ever been opposed in either house of the legasla- ture. Neither had any bill been pass- ed against his recomm endatiorl
 MT. Hendricks said that his depart- ment spent last year about $1S7 .00o and received in fees and payments $287. 726. which was paid into the state treasury. To make examinations that would bring out such information as has been gathered by the legislative committee the witness said would require ten more examiners and an additional appropria- ton of from S50,0Oo to $60.OOO. He thought, however, he could get the ap propriation if he asked for it.
 MT. Hendricks knew nothing Of tie large legal expenses of the New York Life Insurance company, the Equitable and the Mutual Life, as they had never been called to his attention. He had never heard of the Wash sales of secur- ities, nor the year and loans of the Equitable to clerks of Kuhn, Loeb 6 Go. During MT. Hendricks examiria- tion MT. Hughes asked: < Do you require the companies to pre- sent a detailed statement of their legal disbursements, showing the names of lawyers who had money and what they had it for?.
 No, I don't think so.''
 Now, we find information of that sort being furnished to Prussia and not to the New York state department Here, for example, have the state ment of the legal expenses of the New York Life for 1898, giving in detail the amounts paid, aggregating $197,725. .S6, and the names of the recipients as furnished to the Prussian government. Now, did the New York state depart ment ever have statement like tllat9'' No"
 From the New York Life or any oth- CT company"
 q think not"
 The witness said all annual reports first went to the statistician of the de- pertinent and were examined by him.
 Did any one in the department en- deavor to ascertain whether there had been any shifting of securities or tenn porary arrangement made which would indicate that the department report was not true? ?"
 No. we toow the reports as they were made to me-"
 Unless, then you had an examina- ton, you would not detect whether the securities reported at the end of the given year were changed in the begin- ming of the next year?''
 II think not without an examinations,
 When was it first that you learned that Kuhn, Loeb & Go, for example, were taking alleged collateral loans at the end of the year, either in their own name or in the name of their clerks, without any real loan being in existence or intended to be?''
 hdfS SCCA SuCll d SbhlGulGIlL IA1 BI26 newspapers; never learned it.
 Did you learn that in the course of your examination this year?''
 q don't think so.''
 MT. Hendricks said that in making the examination of the Equitable last spring he did not have his attention called to the existence of a memorials dunn in lieu of cash kept by the cashier, and he was asked:
 What examination was made under your instructions to verify the cash returns of the cashier as to cash on hand?" 5.s
 MT. Vanderpoel made it. I did not give any instructions"
 You are in the position of super@ intendent who relied upon your subor- dinates, but in looking over your rec ports, or the reports furnished you from time to time, was not your attens tion attracted to the very large amounN expended by the Equitable, by the Mu& tual and by the New York Life for exc penses ?"
 q thought they were large; di& not know what they had hid away iA them"
 t a