New-York tribune., 1907-12-09
WHO'LL BE THE NEXT?
INDICTMENTS THIS WEE,k.
Brooklyn Banh, Inquiry Woy Shoe
Results I'O-ddY

Two separate sets indictments have been pre-
pared by the Kings County grand jury as u re-
sull of its investigation of closed Brooklyn oahh
ing institutions last week one of tie sets Will
be handed down TO-DAY, il IS thought ana 1t was
said Yesterday that some Of the men already IN
dcted those against whom some ol lhe ne"
Indictments drawn
The first set of indictments was prepared as
result of the investigation Of the affairs OF me
williamsburg Trust Company. Of which Frank
Jenns, already under Indictment, is the depoSeu
president. The second set was prepared as d re-
suit of the preliminary investigation Of the Brook
yn Bank. and conjointly with it Of the lnterna-
tional Trust Company. Brooklyn branch. of Which
William Cow already facin. five indictments. vas
the organizer.
The grand jury this week will prosecute search
ing and thorough investigation Of the last hameo
institutions. only a few weeks before t1e
International Trust Company closed its doors tilat
it announced the Brooklyn Bark iiad oeeh
merged with il. As result OF the falIure OF inc
International Trust Company, the appointment
receivers and of counsel for the de7oSitors ana
the directors well. and their Investigations OF
the affairs of the two banks, peculiar situation
has arisen. The deposItorS are opposing the
merger. They that 1t was revor legally
rorsuTnmated. and they have announced their in
tentiUn 10 fight any twelfth hour attempt 10 MAKE
the merger legal On the other hand. the directors
Of the two institutions express themselves as
favorable the merger. although ac&nowleoslns
that it may have been legally orouSht ABOUT
They viii use every effort to make II legal
The transactions of the Brooklyn Bank ana the
International Trust Company are Interesting. thc
grand jury and viii be carefully looked INTO py
that body. These are
The alleged shaving of collateral
The transfer Of s25ic0 of stocks and bonds Of the
Borough Bank the International Trust Cont
pany. which deposited said stocks and bonds win
The First National Bank of Manhattan 70 secure
loan of Si50000 from that institution.
From information obtained from the District At
torncys Office it would appear that good collateral
VAS put up to secure certain loans made by the
Brooklyn Bank and that later. through the alleged
Connvance of certain persons in the bank, TINS col
lateral removed and replaced by poorer colat-
teral the good collateral being used, presum
ably. security for loans from other sources
This is the transaction referred to as shaving col
lateral"
5. S. Menken. of counsel for The Brooklyn Bank
and the International Trust Company, has been
working with directors of both institutions to pre-
pare a plan to make the merger legal. II is
understood that the called merger never
really legal because notice the proposed merger
not published in two newspapers In Brooklyn
and Manhattan least two weeks before the
stockholders voted on the question Of the merger.
required by Iaw, and because application
made justice of the Supreme Court, is also
required by law.
In talking OF the merger Mr. Menken said:
According to tine plan, the International Trust
Company to buy the Of the Brooklyn
Bank, including Sl-Ssl'ND OF the dcpOSitorS'
and s@olc0 capital stock. 1t take over the
accounts of the dcpostors. Il should have set
aside s3o0.00o pay the stockholders but this was
not done The money paid 10 the Borough Bank.
over o0o. principally depostors' money.
All that Is necessary is to 1ccalize the merger
Then II we get back what the Borough Bank owes
viii have 500 90 over and above all liabIil-
ties The International Trust Company is not ham
pered by any bad loans Cow has paid his S25 oO0
loan. The collateral is all rcazabc and directors
money To put the plan through. w r Jones jr
deposed president of the Oriental has two small
loans"
1t was learned yesterday that Fredo-ick "
Sparks. chairman of the depositors committee OF
tW-enty-fiv of the Borough Bank, had given How
ard Maxwell former president OF the bank note
10 help finance the purchase OF four hundred lots
at Holliswood Queens County Both of these
men were members of syndicate formed to spec
uIate in these lots. each had a sixth interest
in the speculation Mr.. Sparks made out a note
in favor of the Borough Bank and this note Mr.
Maxwell discounted Mr.. Maxwell in his confess
sion the directors told them the note was good
and would be paid when it fen due Title the
lots was taken in Mr.. Sparkss and he signed
declaration of trust acknowledging that each
member of the syndicate had a sixth interest in the
property. Subsequently he transferred his interest
either Mr.. Maxwell Mr. Doolittlc Mr. Cows
secretary. for at any rate Maxwell and Doolittle
conveyed a third interest in the property to the
Ddnh ana llls Dy appraisal VIII lile DanK w
Go $4,000 and above the mortgage liens that
are on the property. which TO about 80 600
at least.
The District Attorneys Office still receiving
daily reports of the physical condition of w. r.
Jones. jr., and soon as he is well enough 10
testify he will appear before the grand jury.
The depositors' committee twenty-five OF the
Borough Bank met at the Assembly. Brooklyn. last
night and discussed the report OF the experts who
have been examining the books of the bank during
the last week. Plans arranged for n mass
meeting tomorrow night of depositors the Co |
lumbia Theatre.