The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-04-17
Tho Gentle Art of Underwriting.

phraseology'
aNo director or oficer Of an Insurance corpora
ton doing business In this State shall receive any
money or valuable thing for negotiating procuring
or recommending any loan from any such oorpo-
ration, or for selling or aiding In the sale OF any
stocks or securities 70 or by such corporation.
ANY person violating the provisions OF this
section shah forfeit his position as such diTeo'ot
or ofeer and he disqualified from thereafter hold
ing any such once In any insurance corporation
In signed communication given by
himself 20 the newspapers and printed
yesterday morning, Mr.. JAMES II. HYDE
director and officer Of the Equitable Life
Assurance Society, publicly confessed
the receipt Of money as profits from the
sale TO that society Of securities under
written by himself and his associates.
He likewise charged by namo another
officer and director OF the Equitable
with the receipt Of money from the same
source. Under his own signature Mt
HYDE made the ubjoined statement:
There had been a syndicate known As james
r. Hyde and Associates Including JANIS W.
ALEXANDER president Of the society whose par
ticipation was always equal 70 my own and this
syndleate had been Underwriters Of number OF
banking issues OF securities, and the Equitable
society purchased In some Instances In the ordl'
nary course Of business. securities which had been
undsrWTitten By this syndicate.
Al the outset Of this controversy Ar, AlH1-
AHrpER and were both advised by counsel that As
% any such syndicate transactions in which any
oenoeu OF the Equitable society had been Interested
n fun statement should be made up and laid before
the board OF directors. and whhtevsT law and Jus
toe REQUIRED regarding them should DO done By
tAs omcsn concerned.
Following the advice Gb0ve referred 70, s1-
amined all thess syndicate transactions and eepos-
TED my check for t5i.t4asi with the treasurer OF
the society a. trustee. This amount represented
my entire prohts from syndicate transactions Of
The character above mentioned. with SiI per cent.
interest up 70 the date Of such deposit period.
1his depoSit WAs accompanied BY the statement
that made u because ] preferred 70 have any
question about this matter setued with the money
under the control OF the society and that this de-
poslt wAs made for the benent Of the society
Tie board Of directors thought the money should be
retained by Il, or returned 70 me II Il should be de-
tsTmlhed that was entitled 70 u.
in other words, this money was Deposited 70 BE-
disposed Of a. the propristy Of these transactions
might be nnAlly determined l made no restitu-
ton. admitted no WronGdoinG, ! admit mons
now. merely put the booisty In the position TO
make itself good 20 far ~ I was concerned. II t.
should DO determined by proper authority that
transactions Of mine, innooently made. made with
the sanction Of universal precedent made with the
approval Of and following the example OF the presi-
dent Of the society. made without the eonoeLnsnt
Of any facts and made without intent TO njurO the
sooisty. and with no such injury a. their result
raised . situation either technically or subStAn-
tally emitting the society 70 pronts which sup
posed Gnd now believe were legiumAtsly mine
We have printed again IN full this
extraordinary confession and statement
because It Ia probably the most important
piece Of direct evidence yet ELECTED in
the slow process Of the extraction Of facts
showing the despoiling of the policy
holders and the violation Of the law.
Mr.. HYDE accuses himself Of having
prohted TO the amount Of SOL 900 by
transactions between himself and asso-
ciateS, on the one side, interested as un-
derwriters, and on the other side himself
and his codirectors as purchasers Of
tho underwritten securities. He names
only one Of his associates. He accuses
JAMES W. ALEXANDER, the president Of
tho society, Of equal participation with
himself In these syndicate profits. Mr..
ALEXANDER was reported yesterday as
denying his completely; the accusation
and the denial are both before the public.
After admitting that he has profted as
underwater by the sale Of stocks to the
corporation Of which he Is an officer and
director, and that when the cloud OF in
ternRl strife appeared upon the Equi-
table horizon he was moved by the ada
vice Of counsel to disembarTass himself
Of the inoonvepient SOL 900, Mr.. HYDE
proceeds TO explain that he does not
regard the Reimbursement as 'resti-
tuition, but merely az deposit, pending
tho ascertainment Of the ownership OF the
SOL 900 by the proper authority With
incredible frankness he announces that
in his opinion the proper authority to
decide whether the sol 900 belongs "a
him or to the poloyholden is the board
OF directors In which he himself Is the
controlling element. And he concludes
his defence by alleging that as against the
inhibition Of the insurance law quoted
above he had the sanction Of universal
precedent This plea, we imagine, will
tend TO widen the present field Of anxious
inquiry II the vice-president Of the Equi-
table il telling the truth.
In Mr.. HYDB's case, the law provides
as a penalty the forfeiture Of his present
once, with It's salary, and disqualified.
ton hereafter from holding any such
Office in any insurance company. Sec.
ton COS Of the Penal Code provides;
Every director OF a monied corporation wh,
s'' wlrlly does any oct ~ sneh director Whicl
h expressly forbidden By law b guilty OF
rnisdsnssnoT. no other punishment u prescribe,
By law
Not merely the Equitable manage,
ment in particular, but Life Insurance.
fnanciering in general as conducted by
the managers Of these plethoric corpora
tions now inviting public scrutiny, re,
sYuirea In vestferation THAR rnethoda "a.