Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1905-12-19
Federal and State Att0r-
neys Are Making an
Investigation.
MANY LAWS VIOLATED
Financial Situation at Chicago
Again Becomes Nearly
Normal.

Chicago. Dec 19.-Practically nor
maj conditions were restored in local
banking circles today Runs ON the
Chicago National and Home Savings
banks continued. but there was no ex-
citement. IL is believed by tomorrow
night the greater portion of the depo-
sits in both banks will be Withdrawn.
Chicago. Dec. I9.-John r. Walsh
and the officers Of his insolvent banks
the Chicago National. Home Savings.
and Equitable Trust-face certain
prosecution at the hands of the ma
tiOnal and state authorities.
National Bank Examiner Bosworth.
who by the irony Of fate Is a discharg
ed employe of John r. Walsh. and
whose inside information as TO the
bankers methods made the work of
investigation comparatively easy. has
laid the facts in the case before United
States District Attorney Morrison Mr..
Morrison is expected To reach de-
cision as to what action he will take
within less than 4S hours
St-nd VIII Receive Report.
Two state bank examiners already
have partly reported the results of their
investigation to State Auditor McCul-
Tough. and he will lay the case before
Attorney General Stead.
States Attorney Healy will i'm all
probability stare an investigation at
once. He last night had given no
personal attention 10 the case. but N
was generally understood in the office
that the minute any violation of law
is found. that instant will the machin-
cry of the law be put in operation.
Joint Inquiry Was Necessary.
The federal and Illinois authorities
have been working hand in hand for
the last three days. IL was only by
JOINT investigation that the bankruptcy
of the institution was proven. This in
vestigation was made at the urgent
request of the federal authorities.
Prior TO this when the federal au
thorities made their investigation of
Mr.. Watson's national bank. the secur
tiles OF the Home Savings bank were
juggled and made to appear as assets
of the national institution. When the
state sleuths examined the Home Saw
ings bank someone hoped from one
side OF the room TO the other and re
turned with the stock and bonds be-
longing To- the federal bank.
The authorities. IL is believed. will
have the widest latitude in prosecut-
ing Mr.. Walsh. as investigation shows
that nearly every law ON the statute
books. placed there for the safe con
duct of banking business. has been
violated by him with reckless impunity.
hanks Thar Were Net pnnks.
John r. Walsh's banks were not
banks. They were simply "a huge cash
drawer for his side lines of railroads.
mines. stone quarries. and other busi-
ness Investments. There was a hole
in The bottom of ihis drawer. which
led into the pay envelopes of graders.
firemen. locomotive engineers. stone
quarry men. coal miners, and laboring
men of 80 different trades.
The depositors dumped their money
into this omnivorous cash box and il
was used by Mr. Walsh i'm vain en-
deavor To turn into a golden reality
his dream of railroad and allied com
mercial supremacy.
Looked Dat for No. Q.
out of the $26.O00.00 deposited in
the halfway financial station maintain
I'd by Mr.. Walsh. $4,000. 600 was loan
cd by Mr.. Walsh 10 companies private
~ controlled by himself
Railroad Caused Failure.
Local hnanciers place Walsh's trou-
bltS at the door of the Southern In
diana railroad \ number of years ago
he purchased Bedford stone quarries
IN Indiana The shipping outlet for
the quarries was not as good as he de
sired. and he soon became involved in
arguments with the Monon and Chica-
go and Eastern Illinois railways. de
claring that they Were charging him a
rate of freight arbitrarily high.
He practically constructed the South
ern Indiana road. the line OF which lay
near his quarries. and ultimately secur-
ed. by means of IL. an outlet which
brought his quarry product to Terre
Haute, Ind. Here. again, he came in
contact with the Eastern Illinois for
transportation north and south
BsiIdinE 10 Chicago.
He determined to build for his road
a terminal into Chicago and bent all
his energies 20 this end 4 fight fol
lowed and continued several years. and