The Montgomery advertiser., 1906-08-14
A1exR Chisholm, Paying
 Teller, Short.
THE YOUNG MAN coNFEssEs
Money Went in Speculation in
 Cotton Futures.
". L. sims and c. L. Hayes, Brokers, Bound over To Await Action Of Federal Grand Jury--Bank
 Not Anected By the
 Shortage.

Birmingham. Aug. 13--tSpecial )--- Within twelve hours today Alexander R. Chisholm, paying teller of the First National Bank was arrested charged with the efnbezzlenent of $97.000 of the banks funds, given a preliminary near ing before United States Commissioner K. B. Watts. put under bond of S50,- 900 and failing to make it. he is to- night in the custody of United States officials at one of the principal hotels of the city.
 During the afternoon ". L. Sims and c, M Hayes. manager and assistant manager of one of the chief stock cot ton brokerage houses in the city, were arrested charged with aiding and abet- ting the embezslement of National Bank funds. They were also given preiim- mary hearing this afternoon and Sims bond was fixed at s5o.o0e and Hayes at s10.010. Both have made bond and are at liberty.
 The shortage at the First National Bank was discovered while Chisholm was on his annual vacation. Tie bank keeps large reserve fund on hand and it was from this that the amount was taken. There was nc regular time for counting the cash in the reserve fund. which accounts for the fact that the shortage was not discovered sooner. Officials decided to wait and allow Chis- holm to return voluntarily. When he stepped from the train this morning he was confronted by the Federal officials and several directors of tho bank. He at first stoutly denied any knowledge of any shortage. but later in the pres- ence of the directors, made full con- fession.
 The Rank Not ARectea.
 W. P 0. Harding. president of the First Natfona Bank, made statement during the afternoon to the effect that the bank would not lose the whole amount and that 1t would not affect the institution. The bank has a capl- tal stock of s1s0n0,000 and surplus of s4ee DOS when Chfshoitn was arrest ed Ss0Oe in cash was taken from his suit case He was bonded by one Of the large bond companies for $30.0oo The difference between these amounts and the shortage has already been ta- ken from the undivided profits ac- count of the bank and charged to profit and loss.
 Young Chisholm was one of the most nopular young men socially and per- sonally in Birmingham He comes from one of the best families in the south and numbered his friends by the hundreds. The announcement today that Alexander Chisholm was a defaulter came like a thunderbolt from a clear s1v and no one was more surprised than his most intimate associates
 1t is stated that practically all of the money embedded by Chisholm has neen uned in speculation in cotton futures, ana that his losses have extended over . nertod of several months. It is said that he traded under an assumed name, made all his payments for margins Tn cash. and that none of his intimate friends knew aught of the transactions
 Alex. Chisholm left Birmingham about August 1 for his vacation AZ sistant Cashier Thomas Bowron tooA fhe nosition during Chisholms ap- senee and after an inspection of the reserve fund, a report was made that there was apparently a shortage. An immediate investigation was put on foot by the president of the bank ana a H L. Cooper, national bank exam iner. responded to a telegrspnlc sun mons The shortage was discovered.
 Immediately following the arrest of young Chisholm and the two cotton ana stock brokers, President w. F C Harding gave out statement In which he tells of the defalcatlon ana the arrests, mentioned above. Con tinuins the statement says: The money loss is comparatively trirllng anfair as the bank as abundantly able to stand 1t, but it Is inexpressibly bad that the demon of speculation should blight as promising a career as that of young chisholn bade fir to be.
 Had Confidence of All.
 .sTIe entered the old Berney National Rank at the age of IS and came to the TIrst National when that institution was merged with 1t in 1901. He had inc absolute confidence of directors and officials. no breath of suspicion against him having ever reached their cara"
 ert L. Chisholm. who is a special att tornev for the government. The young man is 26 years of age and has two brothers and two sisters One of the brothers is employed in another bank of the city as receiving teller
 The announcement of the defalca- lion created considerable excitement about the city. The papers were not on the streets with the accounts until closing time at the bank.
 The three prisoners were taken to the office of the United States Marshal and held until afternoon when the warrants could be heard before Uni ted states Commissioner Watts.
 Alexander Chisholm was a church member and went out in the Jest of society As a result of the defalca- tion. 1t is stated this afternoon that he banks of this city may decline to handle accounts of cotton and stock ana cotton brokerage firms.
 Efforts are to be made to have the next LeRislature pass law prohibit ing brokerage business in this State
 Charges In the Warrants.
 Warrants were issued against Chis- holm, one against Sims, one against Hayes, and one against P. G. Smith. who also operates an exchange imme- diately in the rear of the bank. The first warrant, in which Chisholm and Smith are named, allege that Chisholm, aided. abetted, procured and melted by Smith, did wilfully embezzle various sums of the banks funds The method of procedure was a simple one. Smith merely went to the teller's window, drawing a check for whatever amount might have been agred upon, and in exchange for the worthless check, Chisholm would pass over the money. According to the warrants. the amounts