Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1905-08-01
Instituted Against Officers
Of the Equitable.
Must Answer for SoCiety's
Misappropriated Funds.
Attorney Mayer In Behalf Of State Files
cempIaint---20 Days TO Answer.

New York, July 31.-An action was
instituted, today, by State Attorney
General Julius M. Mayer, in the SUI
preIne court, New York county, in the
name Of the people of the state Of
New York against the Equitable Life
Assurance Society, it's officers, the
| members of the executive and finance
committee, all of whom are named in
the complaint.
The defendants are allowed 20 days
from the time of service to file their
answers.
The complaint contains q sections
and covers SO pages of typewriter
matter. 1t refers to the Prick commit
tee report ana the investigation made
by State Superintendent of Insurance
Hendricks. Attorney General Mayer, In
his prayer to the court, says that the
action WAS brought on behalf of the
people of the state of New York in the
public interests and pursuant to the
provisions Of law. He therefore asks
that the individual defendants account
for their official conduct in the man
agement and disposition of the funds
and property committed to their
charge; that they be compelled to pay
to the Equitable Life Assurance Scci-
ETY. any money and the value of any
property which they have acquired TO
themselves, or transferred to others,
or lost or wasted, by n. violation of
their duties; that any defendant now Il
director or officer i'm the society, upon
proof of misconduct, be removed, and
that the net surplus of defendant soci-
ETY., after deducting a sufficient amount
to cover all outstanding risks and obli-
cations, be divided among the present
policyholdcrs in equitable proportion.
"Neglgently, improperly and i'm
prOvidently performed their duties and
have habitually and continuously done
or suffered to be done wrongful, lille
gal and improper acts, whereof the de-
PENDANT society has suffered great loss
and damage
Section 10 OF the complaint deals with
the lease of premises in New York to
the Mercantile Safe Deposit Co., the
rental of which is declared to have
been inadequate and the terms of the
lease greatly to the disadvantage of the
Equitable Society; furthermore, that
James II. Hyde. James w. Alexander,
Gage f. Tarbell and other defendants
We're directors in the Mercantile Safe
Deposit Co.. and thereby derived a
profit in violation Of their duty to the
Equitable Society. ~
Referring to the purchase of the
capital stock of the Missouri Safe DE-
post Co.. for which the Equitable paid
$3.50 for each 500 par value, the 18th
section of the complaint declares that
the Equitable received but nominal
bn hx- 10 1
Safe Deposit Co.: that at the time of
the stock purchase. 1410 shares out of
q total of 1000 We're owned by James II.
Hyde and the remainder by others of
the Safe Deposit Co. and in the Equi-
table: furthermore that at the time of
the purchase. the Safe Deposit Co.
had no assets beyond the lease, and the
sood will of the business by virtue of
the lease.
The complaint charges that the indi-
Vidual defendants "wastefully, inn
providentiy and improperly" permit
ted the defendent society to make large
excessive and unwarranted loans to
agents. which loans the insurance de-
partment of this and other states had
decided could not be considered as as
sets of the society, and that, in order
TO avoid the effect Of such decisions,
the individual defendants caused every
six months. portions of balances due
from such agents, to be assigned to va
rious trust companies which credited
the society with the amounts as loans
by them to the society and that "the
defendant society reported such
amendments as cash on deposit. there |
by attaining credit for the same in |
its annual statements" |
1t is further charged that none Of the |
notes or other evidence of debt against |
the agents were delivered to the trust |
companies with the assignments and
that the defendant society retained all |
the evidences Of claims against the in
tiividual agents.
1t is also charged that the CONNER
Continued on Page Two) ]