The San Francisco call., 1906-05-16
bank CHARGED
With FRAUDS
BalfOuf, Guthrie & Co. Makes
Serious Accusation of
Cheating.
San Joaquin Valley Money
Depository Called to
Explain.

III sensational complaint nled yes
terday in the United States Circuit
Court, Balfour, Guthrie & Co. Of this
city charge the San Joaquin Valley
Bank and Robert B. Teefy of Stockton
with having fraudulently conspired
with Frank E. Lane to cheat the COM
plainant out of large sum Of money.
The complainant asks that the defend
ants be required to answer certain
interrogatories therein duly set forth
as to the payment by Lane to them of
$207,415 and Of other sums claimed by
Balfour, Guthrie & Co. and their pre-
decessor. An accounting is asked for
in addition to judgment for that sum
with interest.
The complaint filed by Charles Page,
e. ]. McCutchen and w. S. Burnett
sets forth that prior to December, 1901,
Balfour, Guthrie &s Co. established a
branch Of their grain business in
Stockton, and employed as their agent,
with certain limitations Frank e. Lane,
who was not empowered nor authorized
to borrow money on their behalf, nor
to overdraw their account with any
persons or bank 1t alleges that on
November 25, 1905, Lane absconded
from the State and that on December
Of the same year they received let
ter from him confessing that he was q
defaulter On the same date note
was received from the defendant bank
that the firms account had been over
drawn by s75,11S.
1t is averred also that between De-
cember 4, 1900, and December 6, 1905,
the sum of $2,427, ,270 was deposited in
fho Jnfo -
count, and during the same period 81,
502,3S9 was drawn out by Lane, and
that their losses through his action
amounted to 100000.
1t is charged further that Lane sent
the firm false accounts to cover up
his peculatfons; that he Issued fraud
ulent warehouse receipts In his own
name as depositor of the grain; that
of S207,415 alleged to have been paid
to the bank on Lanes obligations,
s151,S21 were overdrawn by checks in
favor Of the bank, that the payment
Of the individual promissory notes Of
Lane to the bank for money loaned by
the bank to Lane on his personal ac-
count and on his individual obliga-
ton out OF the firms money was q
fraud upon the firm.
Complainants aver further that the
bank fraudulently and knowingly ap
propriated the sum last mentioned
from the firms account In bank for the
purpose of paying what 1t well knew
was the individual obligation of Lane
to the bank by funds which it knew
belonged to complainant and without
any consideration therefor to Balfour,
Guthrie &, Co, and without notice to
the firm or making inquiry as to Lanes
authority to do so.
It Is averred further that during the
same period 3. B. Lyons, an employe
of Lane, drew checks on said account
for s2o3,s54. signed. frank E. Lane,
per Lyon" wholly unauthorized by the
complainant. Also that the bank sold
shares of its capital stock to Lane per-
fraud on the part of Lane, paying for
them with funds OF the complainant.
the bank fraudulently executing de-
bit memoranda by which funds TO pay
for such stock were withdrawn from
the funds of Balfour, Guthrie & Co.
and fraudulently converted by the bank
to its own use.
It is charged further that since
August, 1905, until Lane absconded the
bank fraudulently conspired with Lane
that such losses should be shifted from
the bank to Balfour Guthrie &s Co.
and that it aided and abettod and con-
spired with Lane IN continuing to per-
petuate further frauds and irregulari-
ties of like character upon complain
ont