Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1906-08-10
Of Wrecking Of Madison
Ave., State Bank.
Directors May Be Prosecuted
for Liability in Big Thetts.
Cashier Herring Is Arrested and Held With.
out Bail-.-Protesis Innocence.

Imcago, Aug. 9.-Henry w. Herring,
cashier Of the Milwaukee Avenue State
bank. which closed it's doors three
days ago, was arrested in Chicago to-
day. He will be refused bail until his
connection with the disappearance Of
nearly 100000 of the banks funds is
cleared up. Paul o. Stensland, presi-
dent of the defunc, institution, is still d
fugitive, though nearly 100 detectives
are searching for him.
Herring was arrested this afternoon,
two hours later than the time he had
announced for giving himself up. He
was taken to the Office of Chief of
Police Collins, and put through an ex-
animation as to his knowledge of Pres
ident Stensland's alleged mismanage-
ment Of the institution. Herring de-
clared he did not know where President
Stensland was, and that he had had
no communication with Stensland for
more than a week.
Herring strenuOusly denied any re-
sponsipility for the failure of the bank
and maintained that if he was guilty
of breaking the banking laws of ILL.,
nOis, President Stensland was RESPONSE
BILE. Herring declared he never had
benefited single dollar by President
Stensland's system of banking.
State Bank Examiner Jones and AS
sistant Attorney Olson We're present
during the examination. Neither they
nor the police We're satisfied with the
explanation of Herings connection with
the collapse of the bank, and it was
decided to refuse bail until the failure
had been further investigated.
Chicago. Aug 9-Evidence which
may lead to the prosecution of the di
rectors for responsibility for President
Stensland's $1.033,00O theft by forgery
is among the general developments
touching the mulcted Milwaukee Ave-
nue. State Bank.
1t developed that the directors of the
institution neglected to enforce such
precautions as would have made i'm
possible Stensland's operations in fic-
titious paper directly under their noses
Stensland was required to account for
the vast amount of money which APP
parenty was being borrowed by small
tradesmen in the neighborhood and by
small depostors in the bank.
One of the results of Hering's re-
appearance will be that the Corpora
tive store, said to have furnished
channel for disSipating nearly $500 900
of the banks funds will be closed. Re-
ceiver John C. FetZer said this morn
ing that he will ask instructions of
Judge Brentano on the disposition of
the stock in the store. Another de-
| velopment expected today is that the
| estate of the fleeing bank president, of
an estimated value Of 100000 will be
decided to the receiver by Theodore
Stensland.
II am collecting the assets Of the
bank. not running business enter
prises." said Receiver Fetzer today.
80 the store will be closed. The $780,
! 900 in Cooperative store bonds mem
| toned by Cashier Herring were discov-
| cred in the banks vault yesterday
Receiver Fetzer declared that the
| first statement of each in hand at the
| bank was nearly 100000 too high 1t
was said there We're $1,050,000 cash in
| sight. Instead there is only about
$75000O
This does not necessarily mean a
loss" Mr.. Fetzer explained, but there
were many items carried on the bank s
| books as cash that were not 50 in
reality"
From 8 o'clock until II o'clock last
night, reporter and the cashier sat
| on &. bench in one of the city's parks.
| In these two hours Mr.. Herring told the
story Of his connection with the bank
from the time of his employment II
years ago, until he closed his safe last
| Saturday.
When Herring left the city on Satur-
| day he simply went up to the lake for
a days rest. He reached Chicago Mon
| day morning, got on a car and rode
| straight to the bank.
| Just as he reached the edge of the
| sidewalk he saw a man posting the no
| tice Of the closing of the bank on its
| doors. Instead of ascending the steps,
| he back-tracked and headed down
| town.
| The posting Of the notice on the win
| dow proved the elimination Of suspi-
| cions aroused in his mind six or eight
| weeks ago that things in the bank were
not right
| This suspicion was intensified by the
| unexplained prolongation of the 10
days absence that President Stensland
said he was going to take when he left
/ three weeks ago last Sunday.
Herring went to the home Of friend
Mr.. Herring is insistent in his state
ment that he had absolutely nothing
whatever to do with any peculation OF
the banks funds. He swears he has not
profited one penny by the irregularities
brought to light. He asserts that al.
though cashier of the bank. he was
merely a clerk for Stensland; that al
he did was to carry out Stensland's or.
ders.
He declares that Stensland's instruc'
tions were such that there was no way
on their face of determining that an.
crooked business was going on: 1t wa'
only the elimination Of a number O.
suspicious incidents and the piling o
note upon note to carry on Stensland
real estate operations that finally made
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