New-York tribune., 1906-09-03
TRUST co. WAS LOOTED.
Others Besides Nipple Blamed
Nay arrest Directors.

Attorney Bell after a day spent IN examining the
| evidence handed 10 him yesterday By Mr.. Earle.
! receiver OF the defunct trust company. That
Frank X Hippls. the suicide president OF the in
stitution. was not alone responsible for the
crash both Mr.. Earle and District Attorney Bell
are satisfied and arrests may be looked for at
! any time.
The banks officers alone may not bear the
burden Of responsibility. The receiver and the
District Attorney have devoted much time 70 the
question Of liability Of the directors. and de-
veIopments to-day Indicate that at least two OF
them may be called upon for an explanation OF
their action in certifying 10 the correctness OF
bank statements which have since proved to be
false.
Ssmi-annual statements OF the bank, condi-
tion were filed with the State Banking Depart
ment according TO law. These statements
which are supposed TO cover IN detail the IN
stitutiOn's standing. must bear the signatures Of
three directors. IN addition TO the deposition OF
the treasurer. The names signed TO the last
statement OF the Real Estate Trust Company
were f. p Borden r. Dale Benson and Frank K
Nipple
In the semi-annual statement must be IN
cluded iternized list OF collateral held by the
bank As the directors of the trust company by
their own admission, accepted the word OF others
Tor the securities In the banks possession and II
has been disclosed that the lists prepared were
fictitious there arises the liability Of those who
signed the statements for false certihcation and
negligence for falling 20 investigate the con-
dition OF the collateral before attestins the
statement
During the afternoon several OF the direc-
tors met I'm the Office of Joseph De r Junk!n !
director and solicitor Of the company. who has /
admitted that the Arlington Real Estate Com /
pahy' or which he was head. borrowed $3.50. 900 {
from the Real Estate Trust Company
After the meeting Mr.. Junkn said he would
issue statement tonight dealing with the sub
Ject. but later he changed his mind and gave 10
the press the following brief statement:
After mature consideration and IN the full
khoWledge that I have done nothing wrong I /
nave decided mar II rs best not 10 make at this
tline any public statement concerning the mat
ters printed in the newspa pers OF this morning
I STAN s1ahd ready az all times TO give to the re
my actions. both as director and counsel OF said
company. and to account 10 him therefor All
iIlVeDleuhess IN which members Of the board are
ceiver. ''''
In answer to questions. Mr. Junkins said the
trust company, should at all times have been
protected, that the ArIing Brook Company fs now
prospering and that the trust COMPANY can real
ize on its loan al any time
DepOsitors representing $500 600 intrustsd =,
Lhe bank have engaged Samuel Clement former |
Assistant District Attorney. 10 prosecute the d.
-eetors Discussing the liability OF the directors
John H. Converss head OF the Baldwin Locono-
i've Works. and one Of the board OF directors OF
he trust company. said to-day: ]
That which was done IN the case Of the Real
Estate Trust Company would be pOssfbIe urde-
existing laws and regulations in the arrairs OF
my other trust company in Philsdelphia. The
directors went through the forms that are oh a
n -
The fault is with the present system which ! a.
nust ne radically changed before II may safely :
~ Saia mar another real estate trust crash is =
confidence and trust the life Of business
= & .e ease or the directors OF the Real Estate "
!. Lust @ company mat confidence was reposed in q,
Is principal officer. President Nipple And IN ~
@ .ouid nave seemed short time ago. as though
uch confidence might be placed IN him as safely "a
$ IN the president Of any other financial fnstf- a.
ution in the city ~ ~
This feeling Of security on the rart Of The ~
oard was only the reflection of the FEELING ~ in
ne entire community Personally, had known
nm N tor MANY years and, indeed. n was upon re
IS urgent request that entered the board about
isht years ago. declined at first bur NnaIII- [ q
onsented. mainly because Of his urgency ana !
Knowing him I did. I would believe I'm d
IIcltN any statement he might make concern ,
ss ls srIalrs or the company II Is therefore
drqN surprising that the directors accented !
q Nlcn statements when they were duly Certified -
have been quoted as saying that the d,racto-. y
al heid but one meeting in two years II rrisb / &C
deny the statement There IS NO tns,j.'ti wiSn III
lS anairs or which am familiar with which ! an
lgs meet m.
EScePt. perhaps. for recess of two month. In
summer me BOARD met with absolute reen- be
'lN do not know OF a board whose 49,.
- We're more constant in their attendance en-
Asked n II was not surprising that the nrs., Sa
Pm. could have put through the board s+.,a IN
eHs ~ such character that he could so IONS, -!
IN inue the deception. Mr.. Converse said. or wa
nT confess that am amazed that this co,,,5 IN
W. been carried on under the eyes Of the bs, IN,
u II was because Of our unbounded coincidence en-
H'pple Nevertheless. believe IL win ba fai
''"" 'na' Hipple's downfall did nor begin "a
a" 'e"'s ago. 'ct within comparatively re- trJ
n period" | dis
''eS not 'he outcome show that the director.
'H'" nave made clearer examination OF the
LATERAL he was asked
1 do not sae how that ,vo,,t1 =
.vP,'' I"eSe loans were very large. and 4,
80 " W course very great amount OF
r'S u examine them all. The dfroctor- -, ,
ON 'he president and the CertIfcatio1 os h., lat
LteDlent.~ VI "'s or
Sa't'rore Sept The Arlins-Broox COM wn TI1
%; was largo land development concern be-, hai
practically a combination OF six different mo
'd''2tFS organized to huy up and deve,op OF
80 tracts of land between WaIbroox and A. \
Sion. prosperous suburban towns a few miles ma
'thWeSt of Baltimore The Arling- Brook PIN
apany vas Incorporated IN New York Il, / -
H. It's u5"e was a combination OF Arlington
WaIhroo&. The capital stock was 81 25O-
and IL secured I.1OO.000 square feet of prop
=. consisting largely Of o'J and valuable coun-
seats.