Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1905-12-22
HENDRICKS IS UNDER FIRE
New York Insurance Superintendent Quss-
toned by Attorney Hughes
ALL EXAMINATIONS ARE PeRFUNcToRY
Reports Required Taken at Face and
Are Much Less Complete Than
Those Furnished TO Fore
eign Governments.

NEW YORK, Dec. H.-Francis Hendricks
superintendent of insurance Of New York.
was the chief witness before the legislative
committee of insurance investigation today
and testified that the examinations of in
surance companies by his department are
made only to ascertain the solvency OF the
companies and that no inspection is made
into the extrava gance of the management OF
a company or into the salaries paid to OFF,
GERS so long the company is able to pay
it's obligations. No investigation is made
into the commissions paid to agents the
system of loaning on the premiums, the
advancing of loans to agents or loans to
directors. The employment of kinspeople of
officers in high positions Is not inquired
into. This has long been the custom of the
department, Mr.. Hendricks said, and he de-
clared further that he personally knew little
or nothing about the various examinations
made, as they were entrusted to Isaac Van
derpoel, the chief examiner of the depart
ment.
While Mr.. Hendricks memory failed him
as to any legislation which he had sug
gested as a remedy to any defects in the
laws governing insurance companies ne
stated that no measure that he had ever
presented had ever been opposed in either
house of the legislature. Neither had any
bills been passed against his recommenda-
ton.
Mr.. Hendricks said that his department
spent last year about $4,000 and received
in fees and payments s2SL726, which was
paid into the state treasury. To make ex-
aminations that would bring out such in
formation as has been gathered by the
legislative committee, the witness said.
would require ten more examiners and an
additional appropriation of from $4,000 to
$4,000 lie thought, however, he could get
the appropriation II he asked for it,
Legal Expense Accounts.
Mr.. Hendricks knew nothing of the large
legal expenses of the New York Life In
surance company. the Equitable and the
Mutual Life, as they had never been called
to his attention. He had never heard of the
wash sales of securities, nor the year-end
loans of the Equitable to clerks Of Kuhn,
! Loeb & Co. nor had these ever been
| brought to his attention
! Mr.. Hughes asked:
do you require the companies to pre-
! sent detailed statement of their legal dis
bursements showing the names of lawyers
! who had money and what they had 1t for
has the department ever required that?"
mo, l don't think So"
Nov, ind information of that sort
being furnished to Prussia and not to the
/ Now York state department. Here, for ex-
ample. have the statement of the legal
expenses of the New York Life for 1898.
giving to- detail. tie amounts paid. aggre-
eating sls7,72S, and the names OF the re-
cipients as furnished to the Prussian gov
eminent Now. did the New York state
I dan
| that?'
! mo"
From the New York Life or any other
company
II think not"
well, you have got total in the case
Of the New York Life, and the point Is
that II It had not been the tradition OF the
department, or the ordinary practice to
require anything more than so much for
legal expenses. and long as thoy had
enough left to meet their liabilities with
! such margin. that In the ordinary ex-
pectations OF life would not be exceeded.
why you would not take up the question of
the details Of their Disbursements"
/ 81 don't know what report they made.
or course. I am not accurate; it is possible
they did not put them all in the legal ex.
pcnses they reported
Now. what is your practice in regard to
reports that came in? Did you look them
over yourself, the annual reports?"
Not all Of them, If there were anything
that seemed wrong the statistcian referred
to me-"
"Then they were referred to the stats.
tician in the first instance?"
Yes"
"Wnst were his duties with reference to
tho report?''
He examined all the reports"
Did you look through the collateral
loans?"
'T don't thisk So"
who had charge Of that mattor?"'
MIR. Vanderpoe
Takes Reports Made.
Did anyone in the department endeavor
10 ascertain whether there had been any
shifting Of securities or temporary ar.
rangement made which would indicate thai
the department report was not true7"
mo, we took the reports as they were
made to me"
Unless. then, you had an examination
you would not detect whether the securi
ties reported at the end of the given yeai
were changed in the beginning OF the mex
year,"
Il think not without examination"
When was II first that you learned thai
Kuhn, Loeb & Co, for example, were TAX
ing alleged collateral loans at the end Of
the year, either in their own name or II
the name of their clerks. without any rea
loans being in existence or istended TO be p
Il have seen such a statemAnt in the pa
pers; ! never learned it,"
Did you learn that in the course Of you
examination this Vear2'