The daily morning journal and courier., 1905-07-26
BITTER CRITICISM OF
 BIC INSURANCE COS.
MASSACHUSETTS, COMMISSIONER FIERCELY DENOUNCES
 THEIR METHODS.

Refers to the Equitable as the "Dr. JekyH and MT. Hyde" Company Judases at Work Betraying Their Trusts for Financial GaIn-Insuranee and the Gambling Instinct of the Age Graft and Influence of Companies on Public Officials and Law-makers-
 Sweeping Investigation ReeOm- mended-The Royal Arcanum.
 Boston, July 25.-scathing criticism, pointed condemnation and fierce denun- citation of the methods and course of the big insurance companies character izes the annual report of Frederick L. Cutting, commissioner of insurance for Massachusetts, issued to-day. The re- port is exhaustive in its review Of methods employed by high insurance officials during the past several years, to whom he alludes, in some instances as "Judases," and to one company as the "Dr JekyIl and MT. Hyde" com pany, and contains a recommendation that the legislature at it's next session take up the matter of deferred divi- dends and the relation between nsur- ance companies and their allied trust companies, and other questions, with a view of compellin greform.
 The report considers insurance in connection with "the gambling instinct of the age" and tells of the influence upon the officials of insurance compan- les from the dubious schemes, "schemes for getting enormously rich" the graft by city officials, state off1- cials, national officials, petty legislators, congressmen, United States senators and courts subservient to the great Moloch-money," that they have seen all about them, and they also saw "tainted money eagerly sought by col lege and pulpit -
 Commissioner Cutting names several companies. Of the Equitable Life, the Mutual Life and the New York Life, termed the ''Big Thee" and the "Rac- ers,,n the report says that they have been largely responsible for the excess sive expenses of the business, ito swell the volume of which and become the < biggest has led each to pour out money like water;' and it recommends an im- mediate and complete reform of these in respect to the extraordinary deposits made by them with a few favored banks and trust companies. .: Referring to the Equitable Life As-t surance society, the report says: ITO all outward appearances, life in- surance has been booming along serene Iy and beautifully during the past twenty-five years, with money rolling into the treasuries in broad streams.
 t'But rude awakening came A chasm opened, showing the hidden sec rets of great 'Dr. Jekyll and Mr. Hyde insurance company. It had sud- denly dawned that during these twenty five years of peaceful conquest of mill lions of public money there had been Jutases at work betraying their trusts for financial gain.'
 Fraternal insurance and the case of the Royal Arcanum are dealth with at some length in the report the commits sioner expressing his opinion that the new rates recently adopted by that or der and causing such a stir within it's ranks are not too high, and states 'The fraternal does not exist, nor in view of the memorable law of nature, will it or any other kind of insurance company ever exist, which can continue to pay death claims indefinitely if it merely collects the cost of insurance for age of entry"
 After dealing at length with the sub iect of life insurance, of the enormous amount of money involved and of the close relations between the companies and the subsidiary trust companies, the commissioner says:
 Tt must be said that the situation constantly presents the temptation to directors, who also have stock in the trust company, to give the latter all the advantages they possibly can in the way of deposits and loans The inter- ests of their pockets are in perpetual conflict with their duties as fiduciary agents of the policy holders and stock holders of the insurance company, a most unfortunate state of affairs, from which sooner or later, in some instances the insurance company is coming out second best.''