Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1907-11-14
WALSH FLAYED
F0RFRENz|ED
F | n A n c {
LOOTED BANK OF MANY
MILLIONS, IS CHARGED
Opening Address of Prosecu-
ton in Case Against Chicago
Banker Scathing Arfaign-
ment of His Business Methods.
tBy Morning journal Special Leased wire.

| lllClll VI lllO DuOIIlCoo iWOllIOOS
tBy Morning journal Special Leased Wire.
Chicago Nov. I3.-The trial of John
r. Walsh. ex-president of the Chicago
National Bank, on charge of misuse
of the funds of that institution, for
lmally opened today. The jury was
sistant District Attorney Fletcher
Dobyns at the opening of the after
noon session commenced the prelimin-
| airy statement in behalf of the govern
ment. IL is expected that Mr.. Dobyns
will not conclude his opening address
until late tomorrow.
The government will attempt to
show that Walsh took from the Chi
cago National Bank, the Equitable
Trust company and the Home Savings
/ Bank S14,000,0 900
In his statement today Mr.. Dobyns
declared that Walsh obtained the own
ership of various large properties
without cost to himself by using the
funds of the banks. He said
"Watered stock to the probable
amount Of $25.00O,000 or $4,000, 000
was issued. Mr.. Walsh, through his
employees. voted the stock himself. He
then sold this stock to the banks taxi
ing the money to build up his private
enterprises. All of the stock so sold
by Mr. Walsh was practically worth
less"
The assistant district attorney then
stated to the jury how Mr.. Walsh had
induced various people TO sign "ac-
comodation" notes for the bank.
Then" said Mr.. Dobyns, "he signed
the names of people TO the notes.
Checks were made out payable to
bearer and credited to the personal
account of Mr.. Walsh. Bonds We're
10 to hA sIetta, t.agsf
whose names were on the notes and
the credits were made to Mr.. Walshs
account
In 1903 Mr.. Walsh was told by the
bank examiner that the Chicago Ma
tional Bank was being loaded down
with the securities of Mr.. Walsh's per-
sonal enterprises The examiner or
dered him TO take these securities out
and Mr.. Walsh promised to do so.
I'm 1904 the bank was found in the
same condition, the warning was re-
peated and Mr.. Walsh again promised
to remove the securities. Another ex-
animation showed that the bank Was
in worse condition than ever and il
was then ordered closed.
The government will show that
Walsh's method was to buy from him
self, fix his own price and put the
money in his pocket"
As an illustration of Mr. Walshs
procedure In matters of finance the
assistant. district attorney cited the
Peoria Gas and Electric company.
which he referred to as perhaps the
least Objectionable of any of Mr..
Walsh's enterprises"
This company" he said, was or
ganized ins 1899 and the capital stock
was fixed at $4,000 Two hundred
thousand dollars was paid in, and il
was all paid by others in the company
- a. NF.1
hold $500. 900 of the stock and issued
certificates for bonds to that extent.
These were worthless, but he put them
in his banks and took out money for
them and built up the company"
An objection by the defendants
counsel at this point was sustained by
the court and Mr.. Dobyns passed to
the consideration of the southern In
diana Railroad company, reviewing It's
history up to the time Mr.. Walsh pur-
chased IL for $4,000
He had issued TO himself" Mr..
Dobyns said. "S3OO,0O0 in bonds at the
very time IL was organized and those
bonds had no value. He pu. them into
the Equitable Trust company, selling
them at par. then issued another
Sl0O.0 0OO Of bonds and sold then at
par.
He took money from time to time
from the Chicago National Bank and
from the Equitable Trust company to
develop this property, depositing
worthless bonds until he had deposited
with the former 100000 and with the
latter se5O.0OO. He tried to get the
bonds listed on the New York stock
exchange, but he was told to show
their distribution and the matter was
laid over.
Later he stated that they had been
distributed. They had been distributed
In his own banks at his own price. I'm
1901 and 1902, the prosecutor told the
jury. various amounts of money were
taken from the banks with the un-
marketable bonds as collateral until
more than x3,OO0,OOO had been re-
moved from the personal use OF Mr..
Walsh"
Mr.. Dobyns then took up transac-
tions relating to the Illinois Southern
railroad and of Mr.. Walsh's enter
prises. lie declared that money to
finance this road was advanced by the
Equitable Trust company on receivers
certificates and that 10000 Of these
certificates were afterward declared
invalid.
Mr.. Walsh arranged with the bond
holders FOR the purchase Of the road,
he said. "and 100000 Of the COM
pany's bonds were voted TO him. He
put the bond in the Chicago National
and his other banks
About S225,O BOO Of them were put In
at so and later taken out at par 80
Mr.. Walsh had S1.40O,00O OF the COM
pany's stock without Il having cost
him anything.
He intended to connect the road
with the Southern Indiana. but found
he needed more bonds. 50 the capital
stock was increased to $1,000. 600. and
a bond issue FOR this amount was also
made. An attempt 10 market these In
New York failed and they were put in
the Walsh banks"
After several other similar details
had been told the jury. Judge Ander-
son Interrupted the speaker and ad-
iourned the court until tomorrow
morning.
Italian Princes Born.
Rome. Italy. Nov. i3.-Queen Hell
ena this morning gave birth 90 a