Abilene weekly reflector. [volume] (Abilene, Kan.) 1888-1935, 1905-09-21
Assistant Treasurer Of New York
Life Tells the Committee.
HOW THEY DEAL WITH SYBDICATES
Treasurer Of Mutual Life Explains
Hammer Of Handling Business
Through Combinations Of
Capitalize.


ness before the insurance investigation
committee Wednesday. He was ex-
amined on syndicate accounts Tho
Toronto, Hamilton and Buffalo deals
were the first taken up and the ac-
counts were gone into In detail.
How could the New York Life"
asked Mr.. Hughes, counsel to the COM
mittee, retire Toronto, Hamilton and
Buffalo bonds from the syndicate at
80, and when It had bought them while
In the syndicate ut 9lr'
because the market price In the
opinion Of G. NJ. Gibbs the treasurer
at the time, was then 80. We credited
the profit $44,9S8 TO profit and loss"
Mr.. Shipman In reply to further
questions said the company raised the
price from 81 to 90 but that the profit
had never been realized and the CON-
pany holds the bonds at the present
time. ~
1.-THE New York Life IN this case
said Mr.. Hughes. did not return
bonds. as Is customary. to the syndi-
cate managers, but took them them
selves and credited on the books
profit, which IN fact had not been
made" Next Mr.. Hughes turned to
joint account Of Goldman. Sachs a;
Co., and the New York Life In 1899.
The account was created In order to In
vest In Chicago & Northwestern rail-
road bonds with an agreement for
equal division Of profits Mr.. Shipman
said 1t should not be called syndicate.
How can you explain that on July
IS, 1899, you buy and sell $50 bonds on
the same day according to your state
ment?" asked Mr.. Hughes "The only
way can explain it, Mr.. Shipman
replied, lis that the New York Life
held these bonds and wished to sell
them. Therefore It named fair price
and transferred them to joint ac-
count"
Nov, don't you see the purchase is
not for the syndicate, but for,the New
York Life Insurance company" II
can't say: It Is six years ago"
rs 1t fair to say that the New York
Life enters into an agreement with
others and provides the money for the
purchase Of the bonds, and then gives
the members Of the syndicate the pro-
fits Of the saler' YES"
docs II mean the New York Life
pays one half profits to bankers tc
get them to handle the gyndicates:"
Yes, think It is sometimes advisable
IN order to get the business"
The Chicago, Burlington & Quincy
deal was next investigated. W. s.
Fanshawe was the Other member Of
this joint account II, too, was q pur'
chase Of bonds for resale amounting
to 100000 TO 100000,
There seems a great many Of these
Join; accounts" said Mr.. Hughes. is
Il safe to say they are all speculative,
like tho Chicago Northwestern
Yes"
He said another yndicate WIS
formed to purchase the stock Of the
Burlington 6 Quincy railroad.
Mr.. Shipman gave way to Edmund
treasurer Of the New York
Life Insurance company. Mr.. Ran
iolph upon request gave details Of the
purchase for resale Of certain bonds
or Joint account.
Frederick Cromwell treasurer of tie
Mutual Life Insurance company, also
was recalled. He made statement to
he effect that It is impossible for life
insurance companies to seek invest
nents nowadays without the aid Of
yyndicates. He said that heretofore
business could be conducted through
,ond brokers but to-day It must DO
conducted through combination Of
zig capitalists The Mutual. he said,
8 doing business Of S100OO0,0O0 a
rear and must seek the medium Of
indicates. This company, he said,
las sl60, O00, 900 invested Of which sum
1850. 100000 is IN bonds and mort
yAgea.