New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1905-09-13

the line of the three deliveries of bonds from
]. P. Morgan & Co.. then he pointed out two adj
ditional deliveries of 100000 in bonds He also
learned from Mr.. Randolph that the company's
| officers subsequently decided to part with some
of these bonds. He then said:
.Q.-Look on the list at December 81, 1903. Under
the head Of sales you find the "Navigation syndi-
eate $4,000" TO whom did you sell? A.-To J. P
Chase 9o o9 SSang;agy 1904 there entry Of
whom Gid you buy it? Al p Morgan & Co
o, ~ ny die you sell to J. P. Morgan on December
stated before. that when the extra 100000 came in
tne committee thought they would just as willingly
QaB But II they had got rid Ct them why did they
Wei they did Pti'A On the next business oAst
Gas matter OF fact. you made report to the
aio you notf Ave made the statement we always
vQ;-And that showed you held only 100000? A
o.-,The whole purpose of the transaction was to
ee ao Of to se in yogr report to the d.
Navigation Syndicate? Ayes.
Subsequently. Assemblyman Rogers, of the
committee. further pushed the inquiry to this
| transaction by asking:
but the annual report for 1908. made up as
| of the close of business on December 81, would
have been more truly representative of the facts
If that sale Of December 81 and repurchase of
January had not occurred2"
well. it was a sale and purchase"
a
matter of fact. it well understood that you
would buy it back?"
IF it wasn't sold''
''You mean if it wasn't sold over New Years
Day?"
yes"
Mr. Hughes went on with the examination of
Mr.. Randolph. and inquired suddenly:
What is Nylic?"
Mr. Randolph explained that it phase Of
the insurance end OF the business which he was
unfamiliar with He said it was an organiza-
ton of agents. but not a corporate organization.
Mr. Hughes then produced items on accounts
showing the sale to Nylic of $4,000 in Lake
Shore as. Mr.. Randolph explained that Nylic
paid for this by check, and went on to declare
it was method OF accumulation for agents.
that Mr. Perkins was trustee. and that it was
in general benefcent organization for agents.
RELATIONS WITH TRUST COMPANY.
The relation between the New-York Security
and Trust Company and the New-York Life In
surance Company the next point discussed.
Mr.. Hughes resumed the discussion of the rea-
for the large balance the insurance COM
pany kept with the trust company He showed
that the trust company loaned money on col
lateral and made money thereby, while the in
surance company discouraged such loans. Mr..
Randolph explained that the distance of the
hampered it, owing to reluctance of borrowers
to carry securities so far. He indicated that the
New York Life had loans collateral of less
than S1,0O0.000 last year, where the Mutual
had S11,00O.00O. Mr.. Hughes attempted to
show that the insurance company did not
want to loan stocks and therefore turned
money to the trust company, through this
special Account f." for this purpose but to this
Mr.. Randolph would not assent. Mr. Hughes
then followed the gradual diminution of this
Account 4" until it's disappearance in the last
six months, after the consolidation Of tho New
York Security and Trust with the Continental
Mr.. Hughes dwelt the fact that up to this
time the insurance company held the controlling
stock of the trust company. He asked about
the increase of stock after consolidation with
the Continental and endeavored to learn
whether the control remained with the New
York Life, but failed. There was long dis
cussion over the apportionment of shares. but 1t
was shown that the famous Account a. had
ceased soon after the change in control. The
transfer of this account to another bank
noted At first Mr. Randolph was reluctant 10
name the bank.
''Oh. but there's nothing confidential about
the insurance business" insisted Mr. Hughes
The witness then named the First National
Bank.
The last transaction considered was that IN
volving a purchase of New Orleans Railroad
stock Mr.. Randolph testified that when the
Continental Trust Company merged in the
New-York Security and Trust Company there
was in the hands Of the latter certain stock
which was taken by the insurance com
pany, not because Of any apparent obligation,
but because in the sale of it's trust company
stock it had made 100000 profit 1t took over
s., 100000 IN bonds, and syndicate participation
OF So, 1856, 900. Mr.. Randolph explained that the
new owners Of the trust company thought they
had too much of this stock Mr.. Randolph In
sisted that the original proposition had involved
other persons who backed out. He declined to
give names, although after having been adj
vised by Assemblyman Rogers he agreed to
give them to the committee privately.
The Eew-York Life finally put up $50, 375, 900
on severa1 varieties of New Orleans securities,
and the other interests which had agreed to help
backed out That the securities were of doubtful
character was Indicated by the fact that the
minutes of the finance committee showed that
the chairman, after being authorized TO pur-
chase them at first decided against It. The eff
fort to sell proved rather unsuccessful, although
there was an item, which MIR. Randolph called
THE Beyond that Is the profits to come.
This amounted to $7.45O 80, but it was only a
drop in the bucket OF ultimate loss. Mr.. Ran
dolph referred TO a receivership in the New
Orleans company and to a legislative assault
upon it. The net loss in the transaction was
1926 600 Mr. Randolph declared all this showed
on the loan list and insisted he had given this
to Mr.. Hughes, who YVES equally certain he did
not have it.
Mr.. Hughes ended his examination Of this
point thus:
Q-And the fact that you had any interest in
losses did not appear at the end OF 1909? A.
On your report. mean? Naturally not.
Or in your books? A--Naturaliy not