The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-11-18

it was impossible to proceed for perjury.
and in only one case could be find evidence
showing responsibility for a false state
ment. and that was in an nnual report.
on which Mr.. Granniss was indicted:
The possibilities OF a charge OF larceny
growing out of the relations OF the Mutual
TO its subsidiary companies are thus dis
posed of:
In the case now under discussion. from the
most adverse standpoint all that was appro-
priated by the officers and directors was a
possibility on the part OF the Mutual TO realize
alarger profit from its funds than was obtained.
The entire failure Of this case to come within
the statute in regard to larceny Is at once
apparent II one endeavors TO draw an lndlct-
ment for larceny predicated upon these trans
actions. What property, that ID, what defini
tangible personal property in esse OF the
Mutual Life Insurance Company. could 1t be
alleged was feloniously appropriated b the
officers and directors causing these deposits
to he made? And the statutes in regard TO
larceny make no provision for a misappro-
~priation Of possibilities Of profit.
As TO conspiracy 20 cheat and defraud
Mr.. Jerome explains that an examination
Of the authorities shows that there must
have been some false token appealing 10
the eve or the sense OF touch IN order 10
constitute the offence, and IL this be the
meaning of the statute 1t Is manifest mat
the case under discussion does not come
within its terms"
Concerning the transaction in which
A. D.. billiard and others in the Mutual
bought 1000 shares OF the Lawyers Mort
gage Insurance Company and made a
large profit after the stock had been Of
fered to President McCurdy and refused,
Mr.. jerome says:
As co this transaction. It is diHiculC to see
how any criminal statute Of the State has
been violated. Under the most unfavorable
construction conceivable the only penal
offence possible would be under subdivision
4, section 1853 Of the Penal Code. which makes
a certain form OF conspiracy a misdemeanor.
The transaction was in May, 1901, and
the statute of limitations would cover IT,
THE SYNDICATE TRANSACTIONS.
The closing chapter Of the report Mr..
jerome devotes to the Mutual's syndicate
transactions. In almost every instance the
Mutual derived a considerable profit. Inc
oomp any's theory, Then it desired TO pur-
chase securities TO be handled in this way,
Mr.. Jerome says, was that IL was wise TO
take an allotment in the syndicate. so that
when the company bought such securities
in the open mark ct it could make the net
cost less than the market value by selling
of against market cost profits derived from
the syndicate. Mr.. jerome adds:
without considering whether or not this
ia a proper line Of business for mutual life
insurance companies to enter into. the fact
remains, that as a money making PROPOSE
ton these operations OF the Mutual were
successful. II this were all that there was
to these syndicate operations 1t is plain that
no crime was committed, but it was shown
before the joint that certain
officers Of the Mutual Life Insurance Com
pany and certain members OF the finance
committee who controlled the Investments
OF that company had also received allot-
ments In som OF the syndicates In which
the Mutual Life was interested. And 10
has been suggested tina the Mutual Lie
became ~allottees in these syndlcates because
these officers and directors had been In SUBJ
stance bribed by the syndicate managers
by giving them personal In the
very syndicates in which the Mutual Life
Insurance Company participated.
Mr.. Jeroms submits a table showing the
Mutual's participation in syndicate opera
tons, all Of which was presented to the
Armstrong committee.
bribery. Mr.. Jerome says, Ii the most
sinister Interpretation which could be put
upon the conduct Of the officers and trustees
OF the Mutual In connection with these
transactions. 1t would be necessary to
show that the directors received their in
dividual allotments in syndicates as a con
sideratiop for selling or aiding in the sale
Of stocks OF securities 20 the Mutual, but
there il no legal evidence to show this, Mr..
Jerome says. The transactions by them
selves are insufficient to prove criminal
acts. They would only be circumstantial
evidence and the rule OF law in regard to
circumstantia evidence ia that the evil
dence taken IA a whole must point clearly
10 guilt. Mr.. Jerome continues:
These transactions by themselves do not
exclude every other reasonable hypothesis
except that OF guilt. The do not prove
such a meeting OF minds OF the parties as
would constitute bribery had these of1cers
and trustees Of the Mutual been public officers
engaged In analogous transactions. A public
oficer who. by reason OF his ONCE. obtains
information and speculates upon II does not.
in the absence OF an express statute. commit
any crime. And Q trustee Of an Insurance.