Los Angeles herald., 1908-08-30
GRAND JURY
ORDERS ARREST
OF CARLSON
CRIMINAL CHARGE AGAINST
BANK PRESIDENT
ACCUSED OF FALsIFYINo EN-
TRIES IN BOOKS
Investigation Results in instruction to
District Attorney to Proceed
Against Head Of consoIi-
dated Institution

W. IL OfhA AoOlJ pAOlhOICi anu OdAlhCl
has at last been made the object OF
criminal proceedings, f flowing thor
ough investigation into the affairs of
the Consolidated bank, 124 South
Broadway, by officials of the district
attorneys Office and warrant for his
arrest has been issued.
The result of the grand jury investi-
cation was submitted to the grand jury
and that body yesterday instructed
District Attorney Fredericks to file a
complaint against Carlson, charging
him with classifying entries in the
books of the institution.
The complaint is sworn to by Detec-
tive H. L. Brown, employed in the dis
trict attorneys Office, and was filed
yesterday afternoon. A warrant was
at once issued for the arrest of Carlson,
who passed the afternoon in an effort
to find bondsmen.
While the troubles of the Console
dated bank and the Los Angeles Sc
curities company, both of which Carl
son heads, have been spoken of gener-
ally for some time, it was not until
early in June that they assumed the
form necessitating an investigation.
Then 1t was that an examiner from
the Los Angeles Clearing House assoc
citation attempted to make an investi-
cation of the books of the bank in the
absence of Carlson and before being
elected, 1t is said, discovered enough to
cause him to place the matter before
the state bank examiners.
Investigation Made
An investigation by the state COM
miSsionerS was carried on during Carl
sons absence in the east, and as re-
suit Judge James of the superior court
issued restraining order, still in force,
xxyhfnh 70 ha o.
the banks funds, although he still
maintained his position and carried on
business as head of the Los Angeles
Securities company.
The bank was placed in the hands
of Evan Lewis by the commissioners.
The capital stock of the bank, $4,000,
was discovered at that time to have
been impaired. There was hue and
cry by depositors of the bank for a
grand jury investigation and this has
since been carried on
Carlson, on his return from the east
June Is, declared both behk and Sc
curities company were AL right" and
that there was no cause for worry.
The bank, he said, was perfectly SOL
vent, and he said the whole trouble
rested with Lewis, who he said, wished
to be appointed receiver. He offered
to pay OF depositors within thirty days
and also made arrangements with
George H. Peck to staVe off a receive
ership for the Los Angeles Securities
company.
File Complaint
On June II the commissioners filed
complaint alleging the insolvency OF
the bank notwithstanding Carlson's
ployes were restrained from disposing
of the property. 1t was stated at that
time that the bank was doing business
in an unsafe manner, and that there
was a deficit of $4106 and only $500 cash
available. Carlson, 1t was claimed, had
borrowed 100000 from the institution
and q great part of this money is sup
posed to have been used by him in pro-
noting his real estate ventures.
The commissioners statements that
the bank could not do business under
the conditions then existing were Ge-
MED by Carlson, who boosted he was
able to carry on the affairs of the bank
if let alone, and that he would be able
to solve everything to the satisfaction
of every person with whom he had had
business dealings.
Owing to the publicity given the
banks troubles at the time many lot
contractors became anxious, and com
plants began coming in thick and fast.
not only to Carlson but also to the city
and county authorities, and the de-
mands for a grand jury investigation
became more urgent. The affairs of thef
Los Angeles Securities company also
became matter of criticism, and this
was furthered when George H. Peck, |
who some years ago leased a large
tract of land at Redondo to Carlson,
claimed Carlson had defaulted in his
payments, that he was collecting money
for the sale of this property and failing
to turn the money over to him. A tenn |
porary arrangement was made between
the two whereby all moneys derived |
from the sale of the land should be |
turned over to a trust company, which |
in turn should pay Peck what, was due |
him. Later a further complaint was
made by Peck In the courts, in which |
he alleged that Carlson was not living |
up to his agreement.
The troubles of the Consolidated
bank, it is believed, were caused by
the borrowing of Carlson in order to |
carry out schemes of promotion, es-
pecially in real estate. Money deposited |
with him as head of the bank, it is |
said, has been loaned to the Securities |
company, of which he is also the head. |
thus going from one hand to the other
but, owing to many causes, never re- |
turning.
When the warrant for Carlson's ar |
rest was issued yesterday afternoon it |
was placed in the hands of Constable |
Cochrane for service. Up to late hour
Carlson had not been formally arrested,
but 1t Is supposed he will be taken intoI
custody tomorrow. He will be ar
raigned before Justice Stephens, and it |
is believed he will be able to furnish
bonds.