The morning journal-courier., 1908-01-08
SERIOUS CHARGE
 AGAINST HEINZE Copper Magnate and Banker h. dicted for Over Certifying Checks Aggregating
 $400,000.
RELEASED ON S5O,OOO BAIL
Indictment by Federal Grand Jury Aftermath of Collapse of Heinze Pool in Copper Just Pre-
 ceding Panic.

New York, Jan. 7.-Indicted by the federal grand jury for the over-certifi- cation of fifteen checks, representing in the aggregate over $400,OO0 and drawn by the firm of Otto Heinze & Go. on the Mercantile National bank, F. Au- gustus Heinze, the copper magnate and former president of the bank, surrend- cred to United States Commissioner Shields to-day, and later was released on $50,O0O bail. He will plead to the in dictment tomorrow before Judge Chat field in the United States circuit court.
 Edward Lauterbach, counsel for Heinze, said tonight that his client did not wilfully over certify the checks, as he had drawn a check to the credit of Otto Helnze X Go. to the amount of $5OO,O0o, which the bookkeeper of the bank possibly failed to enter on the books until day after the certifica- tion of the checks in question.
 The indictment of Heinze by the federal grand jury, which has been Investigating the Mercantile and other banks identified with the Heinze and Charles W. Morse interests, is the aft ermath of the collapse of the Heinze pool in United Copper. which brought about the suspension of Gross & Klee- berg, stock brokers, and subsequently, resulted in the resignations of F. Au- gustus Heinze from the presidency and the retirement of the directors of the Mercantile National bank after an ex- animation of the institution had been made by the clearing house commit tee. Heinze declared at the time that he had been betrayed by his friends in the United Copper pool, Heinze had been informed quietly that indictments charging over -certification had been found by the federal grand jury De- cember and that his appearance would be required to-day, and without awaiting the service of a bench war rant, in company with his counsel, he appeared before Commissioner Shields this afternoon. The proceedings were short, Heinze pleaded not guilty and bail was furnished immediately by a surety company
 Heinze then told the newspaper men that he did not care to make any statement and hurried away with his counsel.
 After an examination of the indict- ment, which contains thirty counts Counsel Edward Lauterbach tonight, made the following statement.
 
 "The indictment is based upon cer- tification of fifteen checks amountine to something over s4o0,0OO drawn by Otto Heinze & Go. on the 14th day of october last. Before the certification Was made F. Augustus Heinze obtained the discount on note of $50000O, se- cured by abundant stock exchange col lateral worth at the market rates of : that day, more than $S00.000, and drew his check for $500000 to the credit of Otto Heinze & Co, the amount of which should have been passed to their credit, as think it was. There certainly was no wilful intent within the statute t, over-certify any check, not even to the extent that over-certification is prac- ticed ever day in Wall street by all the banks as a matter of business neces. sity. On the contrary, as l have stated there was far more than the amount of the checks standing to the credit oi the account of the drawers of the checks where they were certified. be- lleved if the grand jury could have understood the situation correctly that no indictment would have been found
 The indictment specifically charges that Heinze while president of the Mercantile. National bank overcertified fifteen checks. That is, that he guar anteed by the bank signature that the sums indicated in the checks were held by the institution to the credit of the drawer. To overcertify bank paper IS under the federal statute, an offense punishable by imprisonment of not less than five years and not more than ten years. One count is devoted to each of the checks involved It is alleged that Heinze knew that Otto Heinze S. Co did not have to it's credit the sums named in the various checks. The six teenth count in the indictment charges that Heinze Intentionally applied the funds of the bank, without the knowl- edge of the directorate, to the pay ments of the fifteen checks drawn by Otto Heinze & Co.,, and knowing that the company did not have on deposit with the bank a sum equal to the amount named in the certified cheeks. For such an offense the federal stat utes provides a penalty of not less than five years imprisonment or a fine