Arizona republican., 1905-08-26
Defendant Directors of the
Equitable Society
THEY ADMIT EVERYTHING
In Their Answer to the Suit Of the
State but They Claim That the Acts
Complained OF Were Without Their
knowledge.

]
Life Assurance Society today joined 7
with the state of New York in asking II
for a full investigation in court of its {
directors and officers and their alleged +
wrongdoings in managing the moneys
of the society. The document which ,
announced this determination was the ,
answer of forty-nine Equitable direct
ors to the charge made against them
in Connection with the suit brought
against the Equitable Life Assurance
society by the state. l.
There is an admission that some of
the officials of the Equitable had been
| guilty of improper and illegal acts. In
! all, thirteen charges are answered by
directors. Among these answers they
admit the $25OOO0 loan to the Depew
| Improvement company. They admit
/ the 1856. 900 loan of the Mercantile
Trust company, but waive responsible
/ dty in this loan so far as a board OF
directors is concerned and indicate !
Messrs. Alexander, Jordan and Deming |
as the persons having the most inti- |
mate knowledge Of these transactions.
! The charge that excessive salaries
were paid to the officers of the Equit- !
able is not directly answered but ad- |
mission is made that under the guise |
of salaries excessive fees were given TO /
certain Equitable officials who were
also directors in other companies In
defense the answer states that these
practices were not known to the whole
!, board of directors.
Outlining their belief as to the best
, policy to pursue in fixing the blame of
the Equitable scandals, the directors
say first that the blame for alleged
- cases of misconduct will be found to
rest on Individual officers and not upon
the directors as a body. Having made
this explanation the answer then ad-
mits in a general way the wrong doing
charged.
= The first charge specifically answer
o ed is that the premises on Broadway
We're let for inadequate rentals to the
Mercantile Safe Deposit company
This is admitted but it is denied that
lat the time this lease was made James
H Hyde James w Alexander, VIM.
Alexander. Gage Z. Tarbell, Valentine
: 2. Snyder, Thomas d. Jordan, Charles
3. Alexander Hy. r. Winthropt. Alvin
w Krech and VIM. H Mcintyre were
: stockholders and directors in the Mer-
, camille Safe Deposit company. With
- certain reservations admission is then
made that the capital stock of the
| Missouri Safe Deposit company was
lacuuired by the Equitable society
which paid $3.50 per share for shares
L of par value of 800. Reservations in
u favor of the Equitable, in Connection
these allegations are true in respect 20
certain of the Equitable officers but
:, that the alleged purchases were never
y known to the whole board of directors
As to excessive and unwarranted
loans to agents the reply admits that
they were made. The directors further
admit that the officers who permitted
&c waseful improvident and improper ad-
vances of money to agents may have
Of ava :
ment but they asert that they have
no information sufficient to form a be-
. lief that these officers were knowingly
guilty of such improper acts. Instances
are mentioned in which a system o
= making advances to agents is neces'
: sary and proper, within reasonable
a limits.
to The consolidation of the Western
- National Bank of New York City witt
the National Bank of the United State
c. of New York by which money losses
g RESULTED to the Equitable society anC
= a profit to some of its directors, is al
nd so admitted. But the directors sa,
70 that the responsibility for these losse
o. must be divided among those the in
ed dividual defendants who directly par
nd ticipated in, or by reason of their or
to ficial duties and position should hav
in had knowledge of the transactions.
,r,o ries paid to Equitable officers, whic
a, was embodied in the states charges
is declared to be a true statement q
the figures. A direct admission l
then made that these sums We're pai
without sufficient vouchers OF audl
-. but the directors say their opinion
reserved as to whether such sum
,v were large and in all cases unWar
70 ranted." Admissions of greater lattl
70 iect of pensions and to the charge
70 that money under the guise OF lee
- was received by directors and stock
dc holders who were simultaneously ol
70 ficers of the Equitable and other col
,ch porations.
After admitting that these money
avs were received as charged, the rep
hat states: ANY of tnese detendaI
mn. were ignorant of said transaction
ly- which were not of a character nece
,an sarily known to the whole board
ent directors" Further on the rep
18th states: "Some of said pensions we
found to be justifiable, others exec
sive and some improper.
Denial is next made of any know
val edge or information sufficient to for
ons a belief concerning the payment OF
the attorneys fee which was dlspropo
ar tionate to the services rendered. Ia
ing up the $6S5.00O loan of the Me
camille Trust company. an admlssl
of it's existence is made, but the dire
tors deny that they improperly pc
,ted mitted this transaction. Finally
that admission of the payment OF u
aIIi- S6S5,OO to the Mercantile Trust cor
for pany on July ii last, is made, Dut
on is stated that this occurred only an
der the trust company mad aSseTleu
ONE claim against the Equitable and aft
this claim had been resisted and dl