Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-09-12
RANDOLPH ON STAND
STOCK FOR PRUSSIAN GOVERN
MENT.
Question of Dummy Notes Given by
Marshall, the Mes
senger.

NEW YORK September 12-Inquiry into
the methods pursued by life insurance COM
panes was resumed today by the special
Legislative committee appointed for that
purpose at the special session of the legis-
lature last spring. Today's session was the
fourth held by the committee, and the in
Quiry was resumed where it was broken off
by adjournment Saturday, when e. d.
Randolph, treasurer of the New York Life
Insurance Company, explained the transac-
tons by which the New York Life disposed
of assets objected to by the Prussian gov
ernment.
Mr. Randolph testified Friday that when
the insurance company had to remove the
stock from its assets it was turned over
to the New York Trust Company as col
lateral for a loan for which notes We're
given by George B. Marshall, a colored
messenger employed by the life insurance
company at 5000 year. The trust company
was owned by officials of the insurance
company.
Charles E. Hughes, counsel for the in
vestigating committee. endeavored today
to ascertain who authorized the transac-
tion. Mr.. Randolph was asked today to
point out in the minutes of the finance
committee of the New York Life Insurance
Company the record of the sale of the stock.
my notes given by Marshall another
messenger employed by the company. Mr..
Randolph declared
.It is a recognized custom in financial
concerns to have dummy bonds. l am
sorry the name of George Marshall has
been brought into ridicule. On this trans
action we carried it along for the COM
pany, and made an additional $2UooU0 for
the policy holder
The transfer of the Chicago and North
western preferred stock from the life In
surance company to the trust company,
which was also forced by the Prussian
government, was also reviewed.
Nothing on Books.
Mr. Randolph said there was no resolu-
ton on the books of the finance committee
of the insurance company referring to the
loans made to Marshall and another en-
ploye named Madison. He stated also that
he did not make any delivery of the GER
tifcates of stock
He said: II object to the impression going
abroad that these statements are wrung
from me. We are willing to give all infor-
nation in our power to the committee"
Mr.. Randolph said that the sale of the
Chicago and Northwestern stock was re-
corded in the books of the company, and
that the New York Life Insurance Com
papy received 81 100000, which was de-
posted with the New York Security and
Trust Company.
western stock and the Chicago, Milwaukee
and ST. Paul, Mr.. Hughes asked:
You kept control of the stock after 1t
went off your books so as to make any
profit you could
Yes"
Taking up the non-ledger assets, Mr..
Randolph said they did not appear on the
ledger, but a record was kept In a card in
dex. A card for such an index showing the
record and sale of 2, 100 shares of Erie for
s21O,O00 was introduced in evidence. This
card, 1t was brought out, was the only
record kept of this transaction
Deputy Auditor Called.
Cornelius C. White, deputy auditor of
the New York Life. was then called. He
said the $4,000 received for the Erie stock
was credited to the financial or Han
over bank Office of the insurance company.
Mr. Randolph, again on the stand, said
that 5000 shares of Union Pacific railroad
preferred stock. which was received as
bonus for underwriting, never appeared as
a ledger asset, as 1t cost nothing. He said
that while tie stocks Objectionable to Prus-
sia were oStensibly being sold off, no such
steps were taken in regard to Union Pacific.
The Union Pacific stock. Mr. Randolph
said was sold at different periods from
1889 to 1904.
The question of syndicate operations was
then taken up. Mr.. Hughes drew Mr.. Ran
dolph's attention to the fact that stocks re-
ceiyed by the New York Life bonus
for underwriting were recorded in the card
index as non-ledger assets, while bonds re-
ceived for underwriting appeared as an as
set on the ledger. Mr.. Randolph did not
know why this was done. He presented Mr..
Hughes with pamphlet entitled "Partici-
patton in Syndicates by theNew York Life
Insurance Company for Ten Years Past"
The net profit to the New York Life Insur-
ance Company by its syndicate transactions
In ten years was stated in this pamphlet
to have been 81. 500 G95. This was offered
ATr
legged to show that the New York Life had
In that time made no syndicate transaction
which had resulted in loss. These syndi-
cate Operations were entered into and were
being probed when recess for luncheon
was taken.