The Morris County chronicle. [volume] (Morristown, N.J.) 1877-1915, 1905-06-27
EQUITABLE is CONDEMNED
State Superintendent Of Insurance
Hendricks Makes Report.


! scathing Criticisms of sIe Business ATeth-
/ ODDS Now PrevailIng--aratter Placed BY
Him For Action in Hands of the Attor-
ney General-Aiexander and Hyde Ar
raisned-ProHts should Be PAID Rack
New York City Francis Hendricks,
State Superintendent Of Insurance, in
his preliminary report to Governor
Higgins on the Equitable Life Assur-
ance Society, arraigns the conditions
prevailing and refers the entire case
to the. Attorney General Of the State
for such action as he may deem neces-
sary.
That some definite action in the So
ciety's affairs should be taken by the
State is clearly the conclusion of Mr..
Hendricks. mo superficial measures"
says he, will correct the existing evils
in this society. A cancer cannot be
cured by treating the symptoms"
In many respects Mr.. Hendricks re-
port is more severe arraignment of
the society than that made by the
Frick committee Practically every
abuse that the Prick committee found
existent Mr.. Hendricks finds, and, fur
thermore, the Insurance Department
has delved into the question of real
estate leases and repairs, and shows
that shocking condition of fayorit-
ism and petty graft has existed in this
department for years.
Thomas II. Ryan's purchase Of the
society by acquiring the majority
OF hnId{r1c Of To and
the other devices of the new owner Of
the company, 10 assure it's partial
naturalization by the selection of d.
rectors Thy the distinguished voting
trustees former President Cleveland,
Judge Morgan j. O'Brien and George
westinghouse, is family praised by Mr..
Hendricks.
II do not question" says the Super
intendent of Insurance toward the close
of his report and after briefly advert
ing to the purchase of the company by
new interests and the plans for partial
mutualiZing the cOmpany-"I do not
question but what this is the honest
intention of those who have acquired
the control of the society'-to so man
age it that certain reforms will iaure
to the benefit of the policy holders. Il
OO llUl ll<lllht 1lOM CNClg tn0 my Will
go far toward restoring the confidence
of the present policy holders or aid in
procuring new business for the So
ciety.'
Mr. Ryan's expenditure of So, 500, 900
for Mr.. Hyde's $4,000 worth OF stock
is not likely to prove a very profitable
investment if Mr. Hendricks views
are carried out without specifically
-. 81
ton of the company's control, Mr.
Hendricks has this to say OF stock
ownership:
I'm my opinion the only thing which
will restore confidence and benefit the
company will be the elimination of
the stock control, and, what I deem of
equal importance. the elimination Of
Wall Street control, Complete
naturalization, with the elimination Of
the stock to be paid for at a price
only commensurate with its dividends,
is, in my opinion, the only sure meas
ure of relief"
President Roosevelt, in remark
able letter issued in defense of Paul
Morton's business career. expresses
confidence that he will be able to bring
order out of chaos in the affairs of
TIC lQ41tslOlE koOClCiNs unit LIZ tAASL-
more, declares that in his judgment
thorough insurance reforms can only
be made effective through federal siI-
peryision OF these companies. In this
conclusion the President is Joined by
John A. Mccall. president of the New
York Life Insurance Company: SEN
ator John f. Dryden, Of New Jersey,
president of the Prudential Life In
r,r Csaf-
other leading life underwriters
throughout the country
Mr. Hendricks finds:
That all who took part in'thc deals
of the "James II. hyde and associates"
syndicate should be compelled to pay
back the sums received by them.
That the leases between the society
and its subsidiary companies "Src all
one-sided, unfair and unjust to the
society"
That James Fl. Hyde's authority con-
tinued to increase. and he proceeded to
use the society and it's assets more
and more, as IL they were his own. I'M
til he was checked by the demand for
naturalization and his retirement.
That James w. Alexander was cog
infant of and approved the various
NUnCl0Aull uANAttlAh44f9c NlAtiCtcClf anu
By reason thereof has failed to meet
the obligations imposed upon him as
chief officer of the society, and it is an
open question whether he is not dis
qualified under section SO Of the, in
surance law from hereafter holding
any office in a life Insurance company,
as wen as all the others officers and di-
rectors who participated in these un-
lawful transactions
That the report, with copy of the
evidence taken on this investigation.
will be transmitted to the Attorney
General for such action thereon as he
may deem proper.
Jerome to Act.
District Attorney Jerome will call for
Grand Jury investigation into the
ooie oF fho nf5ionrS and directors IF fhn