The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1906-12-29
George W. Perkins and Former
Secretary of Treasury Fair
child Accused of Forgery.
CLASSIFICATION OF ENTRIES
IS 0FFENSE ALLEGED
Case Grew Out of 'Prussian
Loan" Transaction, TO Com
ply With Law.


jury which has been investigating tho
New York Life Insurance company to-
day returned indictments charging for
gerry In the third degree against George
W. Perkins, formerly vice president Of
the company and a member of j. 2.
Morgan G. Company, and Charles s.
Fairchild, formerly Secretary Of the
Treasury, president of the New York
Security and Trust company and r.
insurance company. Mr.. Perkins was
in court when the indictments were an
nounced, Mr.. Perkins entered a plea
of not guilty and gave bond in the sum
of $4,000, his sureties being j. Pierpont
Morgan. Jr., and Cleveland II. Dodge.
Mr.. Fairchild is in Europe. The court
assured Mr. Perkins that a double sure
ty was not necessary, but he replied
that ne preferred it.
Six indictments were returned against
each of the two defendants, but ali are
based on the transaction known as the
''Prussian loan,n the specification as
to forgery being alleged Justification of
bookkeeping entries. 1t is asserted that
certain railway stocks were transferred
by the insurance company to the Secur-
ity and Trust company in order to com
ply with the Prussian law, but that the
transfer was not bonafide.
Grand Jury Explains
The grand jury coupled with the in
dictments n presentnlenJ in which it
places itself on record as convinced
that Messrs. Perkins and Fairchild
were "inluenced by a desire to benefit
tho policyholders y The grand Jury
further says the indictments were re
turned only under a strict interpreta-
ton Of the law as laid down by District
Attorney Jerome.
Recorder Gotl 8 statement was an of
fetal confirmation of the reports which
had spread about the building where
the grand jury was in session that the
jurors were not at all convinced that
crime had been committed in the
"Prussian loan transaction. The mat
ter was pressed by Mr.. Jerome how
ever, who appeared before tho jury on
number of occasions and made argu-
until late yesterday evening and again
early today.
The trial of w. D. Mann. the editor
of Town Topics. on a charge of per
Jury, before Recorder GofT. was inter
rupted in order that the grand jury
might report, Mr.. Perkins, accompa-
MED by his counsel and prospective
bondsmen, was in court some time be
fore the grand jury appeared: 1t had
Mr.. Perkins would probably be indict-
ed. and his counsel had had several
consultations with the District Attor-
ney, The Indictment Of Mr., Fair
child came as a surprise. for he had
not been publicly connected with the
investigation.
Connection of Fairchild
The New York Security and Trust
company, Of which Mr.. Falrchild was
president. was at the time of the
"Prussian loan - controlled by the New
York Life Insurance company, The
railway shares were transferred by the
New York Life to the Security and
Trust company, and it Is contended that
if crime was committed, Mr.. Fair.
child must have been cognizant of 1T
and q party to the transaction.
1t is said that the discharge Of the
December grand jury, which followed
the presentmenG Of the insurance in
dictments, does not end the inquiry
into the New York Life. The state
ment that the statute of limitations
becomes effective January l, with re-
gard to any Irregularities developed in
the company during the Armstrong in
vestigation is erroneous The inquiry
Will probably be continued by the Janu-
AIRY grand Jury.
The Prussian loan matter was de
veloped during the Armstrong investi-
CATION. Some years ago the Prussian
government adopted a law which eX-
cluded all American insurance compa-
MES from doing business in that coun-
try American life insurance compa-
MES were active there, and the law
was serious blow. They at once
made an effort TO re-establish them
selves by complying with the new law.
AS a result, Prussian commission
came to this country TO investigate
various companies. Among these was
the New York Life. The commission
returned TO Prussia with the recon-
mendation that the companies be again
permitted 10 write insurance, provid cd
they sell all stocks held as securities,
1t being fundamental principle Of
Prussian law that no insurance COM
pany should hold as collateral any
stock. Only bonds were permissible.
Made Transfer of Stock.
To meet this demand the New York
Life agreed TO sell 10000 shares of
Chicago & Northwestern preferred and
$500 shares of Chicago. Milwaukee &
ST. Paul preferred. 1t is now charged
that instead of selling these stocks out
right the company merely transferred
it to the New York Security & Trust
company. subsidiary concern. where
1T was held in trust, not being actually
disposed of until about one year later,
when it WIS sold on the stock exchange
at profit to the company of $l55.000
The Chicago & Northwestern brought
profit of $250,00o, while the Chicago,
Milwaukee & ST. Paul stock showed
loss of 900
The indictments against Messrs
Perkins and Fairchild set forth that
''the defendant. with intent TO dcfraud.
did felonous!v make in certain book
of accounts called the Old Dates Cash
Book. belonging 10 and appertalning
to the business of said corporation GER
tain false entries.
The entry on the first indictment APP
peared rs follows:
B, and s., 5000 shares Chicago 6
Northwestern preferred at $235-S470,
600
''B. and $, 800 shares Chicago, Mil
waukee S st. Paul preferred at Si90-
S57 900 -
(Which false entries" the indict-
ment relates. "then and there pur-
ported to set forth and indicate, and
did III substance and effect then and