The sun., 1907-11-19
DIRECTORS TALKED SHOOTING
WHEN THEY DISCOVERED BOR-
OUCH BANKS SECRET LOANS.



Assistant District Attorney Robert RI.
Elder began proceedings before the Grand
Jury yesterday which it is expected will
result in the indictment OF several Brook.
lyn bank officials. Only documentary
evidence was placed before the Grand
Jury yesterday. but to-day several wit
nesses. including a representative Of the
State Banking Department, will be called.
Yesterdays proceedings had to do entirely
with the affairs Of the Borough Bank, and
it is likely that the investigation in that
direction will take two or three days more.
full statement of the affairs of tho
Borough Bank will be made by the dircc-
tors at a meeting Of the depositors in the
Columbia Theatre in Brooklyn this MORN
ing. This statement, which was prepared
last night. discloses in detail the loan trans
actions which resulted in the retirement oH
two Of the Company's officers.
According to the statement c. W. Her
mans, one of the bank examiners. reported
after going through the institutions affairs
banks largest stockholder. amounted 10
Sis5, 1887, secured by collateral amounting
TO Sl55, 700. and that these loans were in ex-
cess Of 90 per cent. Of the capital and book
surplus OF the companyS ~ per cent. being
the legal limit Of secured loans TO any one
borrower. The statement continues:
HE Mr.. Hermansl reported that the in
direct loans to Mr.. Cow. that is to say loans
made for his benefit or on his responsibility.
TO Frank w. Doolittle. his private secretary.
and others connected with Ward a Cows
business amounted to S125. 1852. It also
appears that loans we're made 20 Howard
Maxwell. the president; to Arthur d. Camp
hell, the cashier. and 20 John s. Jenkins,
who was associated with Cow and Max
well in divers enterprises. which loans ag-
gregate upward Of 100000. These loans
to- Cow. Maxwell. Campbell, Doolittle and
Jenkins were secretly made. the persons
named studiously Withholding all inforna-
ton respecting the same from each and all
Of the other directors
The statement sets forth that the d.
rectOrs on the day following tho closing OF
the bank obtained from Mr.. Campbell,
the cashier. certain admissions which led
them Immediately to enter upon a most
rigid examination, not only of Mr.. Camp
bells dealings with the bank but also of
all the transactions IN which Mr.. Cow Mr..
Maxwell. Mr.. Jenkins and MIR. Doolittle
had been concerned. According TO reports
circulated yesterday that first meeting
Of the directors after the suspension of the
company was probably the hottest affair
Of its kind ever held in Brooklyn. There
were stories yesterday of threats Of viO-
lence on the part Of certain OF the directors
toward others. These threats, IL was said.
included talk Of shooting
Day and night" says the statement,
"the directors worked on the ihqusitiOn
and one after another Of these men was
summoned before the board and questioned
minutely as to each and every transaction
in which ne was concerned, directly or in
directly, and the admissions and confess
sions of each of them were taken down in
writing and this record was finally deliv-
cred to the State Banking Department in
order that the department might take such
action as it should be- advised should be
taken in the premises"
The statement says that the examination
of the men mentioned above enabled the
directors to ascertain precisely what prop
critics, real or personal. each owned or vas
interested in.
@The directors thereupon adopted resolu-
tions expressly repudiating the transactions
referred to, calling on these men TO make
immediate restitution to- the bank to the
fullest extent of their ability and demand
ing the designations of Messrs. Maxwell,
Campbell and Cow. MIR. Paul Grout. coun-
sel for the bank and his legal associates
we're instructed by the directors to prepare
the appropriate papers for the conveyance
to the bank Of all the right. title and inter-
ests Of those men in and to the real and per-
sonal properties they owned or had inter-
ests in. These papers were prepared and
duly executed by Messrs. Maxwell. Camp
hell. Cow. Jenkins. Doolittle and others
acting in their behalf"
This additional collateral which was
put up is estimated by the directors 10 bo
worth s767OOO. and the State Bank Ex-
aminer in reporting IL to the department
says the collateral IL worth at least t7O0.O
and that all the loans are now amply secured.
In addition 20 this the directors secured
the conveyance 20 the bank Of all the
/ interests of equity Of Cow, Maxwell and
Jenkins in the tract OF land known AZ
Bellaire Park. near Jamaica. The capital
Stock OF TINS company IL S5OO.OO, anu Jno
bank. 10 In said. now owns all OF IL.
According TO the directors statement
the bank examiners report shows a sur
plus now OF sIS7.OsO and an unimpaired
capital of 100000. When the bank closed
it's doors the surplus was figured by the
bank examiner at 81 1892 and the capital
WAS unimpaired. 1t is expected that the
depositors' meeting this morning will pro-
test against the appointment Of a receiver
for the Borough Bank. and viii urge the
bringing Of some legal action TO have the
receivership vacated. The Borough Bank
had sss7.O37 in cash in it's vaults when IL
closed It's doors and since then good many
loans have been paid OF.
IL was learned yesterday that more than
one forgery charge will be investigated
by the Grand Jury in connection with the
affairs OF the bank. THE Sun told yester-
day OF an alleged forgery Of a check sup
posed TO have been drawn on a large estate
account in the Borough Bank and deposited
in New York Bank as part OF the Interna-
Al ~ - -