The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-04-15
HYDE RETURNS $4,000 MORE
THAT THE EQUITABLE LOST IN
TWO UNDERWRITING SCHEMES.

NtlhiAAhAN IN inc
Same scheme Haven't Given Up, but
There's Hope &C Hearing From Them
vice-President James II. Hyde Of the
Equitable Life Assurance Society, accord
ing TO reliable information, las refunded
to the society not only the money paid out
Of the Equitable treasury for the Cambon
dinner, but also tl22 900, representing, il
Is said, small part Of the Equitables Loss
in securities unloadsd on the society by
two underwriting syndicates Of which Mr..
HyGe was a member.
This sl2?, 900 represents, It was said yes
terday, only Mr.. Hydes proportionate
share Of the loss to the policyholders. Other
directors Of the organic ation, how many
Of them was not learned, were interested
in the underwriting deals, but none Of them,
it was declared, has so far followed Mr..
Eyde's example in the matter Of reimburs-
ing the society 5 treasury.
That the names Of these direct ors will
he furnished TO the Har rman investigating
committee was not doubted yesterday.
That they will greatly interest Mr.. Harri-
man, as well as all other members Of the
committee, is also certain.
The Si22 eco was refunded by Mr.. Hyde,
Il was said yesterday, soon after the meet
ing Of the directors late in March at which
the 2s-24 plan of naturalization on the
four year basis was presented to the board
and adopted. At that time Mr. Hyde eI-
pected that in return for the concessions
made by him the controversy within the
society would be called off, but he was not
certain that an investigation Of the societys
affairs would not be made.
In view Of yests rday's disclosure the
demand Of the investigating committee to
President Alexander for information in
regard TO all so called underwriting" by
the society was seen in a new light. The
common form Of getting big slice Of the
policyholders' money, it is explained was
through the operations OF an underwriting
syndicate. A railroad In which one or
more Of the Equitable's directors are inter-
ested would bring of big bond issue. An
underwriting syndicate would be formed,
composed largely Of Equitable directors.
The bonds would be underwritten by the
syndicate, say at 90, at which price all
the bonds unsold by the syndicate to the
public would fan back upon the syndicate.
The syndicate would engage a banking
house 70 dispose OF these unsold bonds,
say at a5. Offers would be made by the
hanktnE house 10 the EQiita bio at anywhere
from sS to o., and the Equitable, under the
inffuence Of the directors who were men,
bers OF the syndicate, would take them
the banking house, Of course, getting any
thing over IS as it's profit. That is. the
Equitable directors, after having bought
tho bonds as syndicate underwriters at %,
would sell to the society at e5, the policy
bolders paying the difference.
A. Edward Woodruff, a lawyer represent
ing Henry G. Hull Of Philadelphia and all
other policyholders similarly situated
obtained from Justice Scott in the Supreme
Court yesterday an order directing the
officers and directors Of the Equitable
society and the State Superintendent Of
Insurance to show cause why they should
not be enjoined from further proceedings
as regards the approving and fling Of the
proposed amended charter. The order
Is returnable next Thursday.
Counsel representing the Equitable society
and other lawyers interested IN the con-
troversy gave It as their opinion that this
new action. so far as supt. Hendricks is
concerned In IL, cannot result at all seriously
for the policyholders' interests. It is
almost certain, these lawyers said, that the
Superintendent Of Insurance cannot be en-
Joined In the matter. II II were possible
10 restrain him. action toward that end
would have been taken by counsel repre- |
senting Franklin B. Lord In his injunction |
suit, as soon as possible after it was dis
covered that the amended charter had been |
hustled by special messenger to the Super !
intendent in Syracuse.
What probably will happen on Mr.. Hen
dricks's side Is that a representative Of the |
Attorney General will appear in court next |
Thursday and state merely that the Super |
intendent cannot be enjoined.
Az to the action against the officers and |
directors Of the society, though this was !
taken lightly in some quarters yesterday,
Il adds another factor to a situation that !
has become already too involved 10 suit |
many persons who want 10 see the mutual |
ization Of the society an accomplished fact !
before next December, when Mr.. Hyde |
comes into control OF the stock held in trust |
for him.
Mr.. Woodruff's action Is incidental 10 one |
brought by him in the Supreme Court last |
feDTudTy on DenaH OF Tue same cHoutss Al
that action he asked the court 10 determine
the rights Of the polioyholders in the So
ciety's surplus and 20 sppraise the value Of
its stock, 80 that the directors might be
restrained from paying any amount In
excess Of the appraised value.
Mr.. Woodruff charged then that the char
ter Of the Equitable was being violated In
several ways by the directors, one being
that no actual distribution Of any part OF
the surplus had ever been made 10 policy
holders. He would have the surplus dis
tributed. His new action for an injunction
contemplates restraining the society only
until decision has been rendered in his
former suit, in which practically nothing
has been done up 10 this time.
In his sworn statement accompanying
the application, Mr.. Woodruff says that the
society has wholly failed 10 carry out the
principles upon which il was organized in
respect 10 the equitable distribution OF the
surplus and the representation Of policy
holders on the board Of directors; that this
fact recently dAvned upon certain directors
Of the coupany and that RppArently