The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-09-02
DIRECTORS SHARED TIE LOOT
ARRESTS WEAR ~ PHILADEL-
PHIA TRUST 90. CRASH.
District Attorney Not Ready 20 say How
Many Are Implicated -RumOr mat
BippIe 10 Not Dead but In Europe
-DepositOr Tries 10 shoe q director.

-Bep0oitor fries TO shoot q Director.
PHuADELPHIA, Sept. AFTER an all day
grflling Of directors and ofsdals Of the
wrecked Real Estate Trust Company, before
Receiver Earle, a session that lAstsd until
. O'Clock tonight, District Attorney John
T.. Ball announced that he had entered
actively into the Investigation, had become
convinced that there was serious oriminRlity
In the looting Of the bank and that he had
evidence enough from the hearing to-day
to Justify the arrest at once Of three persons,
" OF them oficials Of the trust company
and the third q bank examiner.
Three at least Of the directors are In q
pertious position so far as reputation and
liberty are concerned and two directors,
Joseph De Forest Junkin and ex-JudKe
W. W. Porter. collapsed at the end OF the
Investigation tonight.
The vigorous probing by the receiver
began after he had discovered that not
only the deposits but the trust funds had
been tampercd with to the extent Of 500 900
and upward. and no confessed that the
upward might mean ANYTHING.
While the r~ec=ivsr was giving the third
degree to officials ADD directors a deposltor
hot ut q man he supposed to be q director
and escaped III the crowd. and q report
was started that President Nipple is not
dead, that his suicide was faxed and that
he Ia in Europe. These things stirred the
rowds OF deposttors and others In the
streets to frenzy.
Directors, ofloials and clerks were called
by the receiver, one after another. Three
OF the directors. Junkin, Porter and former
state Senator Bayard Henry. admitted that
they had &C times acted as counsel for
AdOlph Segal, whose wildcat collateral did
much. but it now seems not nearly all, to
wreck the bank.
Four Of the directors were plainly charged
with having known OF the loans to Segal
months before the crash came. They were
also charged with having directly aided and
abetted Nipple in his criminal methods.
William F. North, the treasurer Of tho
trust company, who knew Of the bogus
list Of securities the president presented
to the directors and through whose hands
all the illegal loans passed, was a fruitful
witness. as was Theodore Prosser, the COM
pany's real estate officer, who must have
been called Upon to approve the gigantic
mortgages on the properties offered by
segal.
"oS sOuSNSlVuhI Ot All tuo AOnllbotOnD
was thst Of Joseph Def. Junkin, an attorney
and a director Of the wrecked company,
that the Arlingbrook Real Estate Company
of New York, owning property near Balti-
more, had borrowed $4,000 from the
Real Estate Trust Company, and that Di-
rectors Junkin, R. Dale BsnsSn Charles e.
Henry and Edward p. Borden and President
Nipple, in consideration Of 50 per cent. of
.ths amount Of the loan, to be paid to Aem
in full-paid stock Of the ArlingbroOk com-
pany, guaranteed to make good the bonds
IL the loan was not paid. Mr.. Junkin at
the time Of this transaction was president
Of the Arlingbrook concern aswsll az solicit
tor and director Of the Reab Estate Trust
Company.
In other words. these men, as directors,
used the trust cOmpany's money for Di-
rector Junkin's own venture After a
time the Arlingbrook company was fore
closed. The Real Estate Trust Company
was compelled TO buy it because the Eve
directors who had underwritten the con-
Germ failed TO make their guarantee good.
Mr.. Junkin, in explanation Of this transac-
ton, said II was not unusual in banking
institutions. and that the directors Of the
Real Estate Trust Company had made a
practice OF borrowing tho oompany's money
TO advance their own enterprises.
The whole thing savors Of c~riminality,-
said District Attorney Bell, a. he emerged
from tho trust company's building in COM
pany with Receiver Earle shortly after
0 O'Clock tonight. Just what action I
will take 1 cannot say. for the matter has
passed to the point where zach develop
ment will figure "A evid0no0.S
How any will be arrest. d?'
Il cannot ven tell said the District
Attorney. But it takes more than one
to make n conspiracy
The discovery that President Nipple
had taken money from the trust funds
intrusted TO the institution destroyed the
last remnant Of faith which several Of
the directors still held in Nipple.
J. Hector MoNeal, . prominent lawyer,
before the receiver. He said Il was
a note for 500 900 held by him that drove
Nipple TO suicide. It was due the day
after the suicide.
Prompted by the discoveries be has
made, Receiver Earle has asked Attorney
John q. johnson to give an opinion as to
the responsibility for the failure Of the
bank.
JOnn F. boJE, D wealthy DroWor ana
capitalist, 10 the first Of the directors OF
the Real Estate Trust Comp any to offer
to make good the losses Of depositors.
He said:
Il am game enough to make good what
sver the directors are called upon for. I
am personally willing to 60 as far a. any
Of the other directors and will contribute
my full proportion
Mr.. Betz frankly admitted that he knew
little or nothing OF the Real Estate Trust
Company's affairs, that no attended as
many board meetings as ! had tins 20 at
tend and that he supposed the other
directors knew more Of the banks affairs.
John L. Borsch Of the opticA firm OF
BOrsoh a Co. threatens criminal proceed
ings against the Real Estate Trust Com
pany directors for what he charges is the
illegal Withholding Of his deposit.
Mr.. BOrsch declared that on Tuesday
morning last he depo sited $500 to his ac-
count. This wal at IL o'clock. not more
than three hours before the announcement
OF tina concerns failure.
G.-. - a.. N.ohs