The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1906-12-28
TWO INDICTED.
Perkins and EairchiId Held on
Charge of Forgery
In Connection With Affairs of
the N. Y. Life.
A FALSE STATEMENT.
Was Made to Satisfy the Prus-
sian Government.
Is One Of the Charges on " hich
the Bill Was Found.

New York, Dec. 2S.-George w.
Perkins. formerly vice president Of
the New York Life Insurance COM
pany and now a member of the firm
of J. P. Morgan & Co. and Charles S.
Fairchild, formerly secretary of the
treasury and a trustee of the New
York Life Insurance company, were
indicted today by the grand jury
charged with forgery in the third de-
gree. The indictments were based on
what is known as the Prussian Bond
transaction in which it is charged that
a false statement was made by the
New York Life Insurance company
in order to satisfy the government of
Prussia as to the securities held by
Mr. Perkins appeared in court and
gave bail in the sum of 100000. Mr..
Fairchild is in Europe.
Dummy sale of Shares.
one of the transactions investigated
by the grand jury in this connection
Is what was alleged to be dummy
sale of 10000 shares of Chicago &
Northwestern preferred stock ana
$500 shares of ST. Paul stock to the
New York Security & Trust company
AS far as appeared on the books of
the New York Life Insurance COM
pany this transaction was complete
sale Of the securities. The New York
Security & Trust company, however.
recorded 1t as a loan. Later these
shares we're sold by the New York
Security & Trust company at a prohs
to the life insurance company OF
Sl55OOO This alleged false state
ment of sale had for its object COM
pliance with the rules of the Prussian
government that life insurance
company doing business IN that coun-
trv should not include corporation. s
stocks in its assets but may include
bonds in such assets
Grew Out Of Hughes Investigation.
The grand Jury's Investigation OF
the affairs Of the New 1ork Lire In
surance company which resulted III
the indictments returned today was an
outgrowth Of the investigation Of the
insurance companies by legislative
com uittee a year ago.
So voluminOus was the testimony
tnkel by the executive committee that
District Attorney Jerome was occupied
for months in examining II. George
w. Perkins a former vice president OF
the company, member of one of the
most influential financial firms in the
world. was arrested on technical
charge of larceny but that the pro
ceeding was merely a test case was
shown when it was permitted to go to
the highest court in the state without
any opposition from the accused
Pressure on jerome.
The pressure upon District Attorney
Jerome to proceed against high Of
fcials increased rather than diminisd-
ed as time went on During the spring
months. the public demand for action
was reinforced by Justice O'Sullivan.
of the court of general sessions. who |
in a sensational charge to grand |
jury directed them to take up and in |
vestigate insurance matters with the |
assistance of the district attorney, II
he chose to give them assistance, or |
without it If he did not. The question /
was considered to some extent by that |
jury but no definite conclusion was |
reached and the work they had begun |
was left unfinished when they were /
dismissed. On the request of the dis /
trict attorney a special grand jury was I
next drawn for the sole purpose of /
taking uD the insurance cases. The /
real activity. however, began only q /
few weeks AGO after the conviction of
George w. Burnham, jr., general /
counsel for the Mutual Reserve Life
Insurance company. on charge of
forgery. The indictment of Burnham
and two other high officials of the
Mutual Reserve had followed the in
surance investigation. The verdict
against Burnham convinced Mr..
Jerome, so he later announced, that
there might be grounds upon which he
could proceed against the officials of
the New York Life. As a result the
matter was once more placed before
the grand jury and was pressed Wig
OF ously.
Witnesses Examined.
Y ork Life Insurance officials who have
been examined by the grand jury are
George w. Perkins, Edmund D. Ran
dolph treasurer; F. H Shipman. as
sistant treasurer; Woodbury. Langdon.
and George A. Morrison, who were
members Of the finance committee in
10000 and Milton NJ. Mattison, head
bookkeeper Of the treasury depart
ment of the company. Another wit
ness was Alexander Webb. jr-. secre-
tary of the New York Security & Trust
1t has been said when Mr.. Perkins
was a witness before the grand jury
he was warned of his LEGAL rights but
Il is understood that he told all he
knew Of his connection with the vari-
Gus transactions in the New York In
surance company.
Jury SmoOths 1t Over
The indictments were reported to
Recorder GOn while another case was
being heard. The latter hearing was
while the recorder listened
to the report of the grand jury. The
Jury reported six indictments against
each OF the accused men. Accompany
ng the indictments was the following
sta te ment
The grand jury respectfully pre-
sents that in fling a bill of indictment
lgaiust two persons for Offenses COM
mitted in connection with the affairs
1f the New York Life Insurance COM
Dany that accepting the law of these
CAGES as advised bv the district attor-
hey. they felt constrained to find the
Indictment this day filed The grand
Jury. however. desire to record their
charged the defendants were in
1uenced by a desire to benefit the
Of the New York Life
Insurance company; that the defend