New-York tribune., 1908-12-08
MANY CHURCHES LOSE
PRIESTS And NUNS HIT
BY FAILURE.
Catholic Institutions Suffer Through
Z. J. keiran's Funding Company,
Which O1Ces S4,5OO,OOO.

Between fifty and sixty Roman Catholic
churches, semnaries, colleges and nunneries IN
various parts OF the country it developed yes
terday. are sufferers. some of them to a very
serious extent, through their transactions with
the Fidelity Funding Company, which month
ago was placed in the hands Of Thomas F. Gill
roy, jr as receiver, the application OF the
directors The known liabilities Of the company
are more than S4.5OO,OO0. but the concerns af-
fairs are In so tangled a condition that
curate aggregate Of the liabilities he
rived at nor can the assets be approximated.
The company was organized under the laws
of this state in 1899 carry on a general in
surance and agency business, but in November
1905, branched out into the business of handling
negotiable instruments In its later development
It was conducted "one-man concern" Mr.
Gilroy said yesterday, the controlling spirit
being P. j. Keiran, who was it's vice president
at the time of the recevership, and who had at
various times in the past filed the presidency
and other Offices
Mr.. Keiran. who lvied in Toronto and in Buff
falo before coming to this city and who is about
forty-hve years old, has rot been seen in New
York since the company was placed in the
ceivers hands but in the interval has visited
various cities in which Catholic institutions are
located, and. according to Mr.. Gilroy's advices
would be glad to have a conference with him.
in the hope of Strengthening out the tangIe -
the concerns affairs, and is also anxious to get
books, claimed BY Mr.. Keiran as his personal
property, which were removed by some one
from the Companys offices just after the re-
ceivership.
REFUSES TO GIVE Up BOOKS
Mr.. Gilroy has asked Bainbridge Colby. Of the
lov-
keiran's attorney, to produce the books and
Mr. Colby has repeatedly said that Mr.. Gilroy
was entitled to them: but in whose custody they
are at present is a mystery.
AS has been indicated keiran's clientele was
almost entirely among Catholic Church institu-
tions end members Of orders in that Church
He was the only Catholic in the companys man
agement and the priests with whom the com
pany had dealings naturally asked always for
him, and preferred to do business only with him
The transactions were based upon building or
Improvement operation planned by the fnstftu-
tions or suggested 10 them by Keiran The
borrower would take a twenty-year loan and
also would take out twenty-year endowment
life insurance policies to the amount of 75 per
cent OF the loan rule. the idea being that
the policies would at the end of the twenty
years suffice for paying off the face of the loan.
The funding company would place the nsur-
Of several young priests nuns. with the Rei-
ance Life Insurance Company, of Pittsburg or
the Security Life Insurance Company, OF Chi
cago. The funding company as a genera! thing
collected the brokerage The borrower would
also be required to give first mortgage on the
property to secure a note, and the funding COM
pany would charge per cent for the ac-
commodation, rate large enough 10 enable the
premium on the insurance policies and the in
terest on the note TO be met.
In offices closely connected with those Of the
funding company were the headquarters of sew
eral concerns, which. Mr.. Gilroy says. appeared
to be Keiran's property-the Columbia Con-
struction Company and the Federal Constrlc-
tion Company. which were engaged in church
construction work; the Mcbride Studios which
did interior decorating and the Western Illinois
& Iowa Railroad Company, electric road.
HAD NOTES DISCOUNTED.
The funding company would have the notes
discounted, Mr. Giroy said, or, if one of Keirans
companies. like the Mcbride Studios needed
money. would let it have Of the notes from
the funding company's treasury, which the Nc
Bride Studios would have discounted As the
notes matured earlier than the mortgage and
as at their maturity the construction work was
in many cases still in progress, renewals were
had and the renewal notes also were discounted.
One Of the principal sufferers from the Fidel-
ity Funding Company is St. Mary's Academy at
Nauvoo Ill. the authorities of which. Mr.. Gilroy
says gave KeIran notes aggregating $1.400.o00
on two mortgages totaling s23o,OO0- The acad
envy property is valued at from S250,0o0 t.
$500 OGO In this case it appears that the au-
thorities gave keiran number of signed notes.
with the date and amount left blank, and also,
It is said. a checkbook with checks signed in
blank The holders of the notes, which have
been discounted. are now suing the academy to
recover their value.
Among other institutions which are worrying
over the funding company's collapse are St Vim
cents College, in Chicago. which gave notes
aggregating $500 900 over and above a mortgage
Cleveland, which is involved to the extent of
$4,000. Mr.. Gilroy also mentioned instances of
one institution which reports that 1t got only
IS 900 in cash. has $50. 600 in outstand-
ing; another which has $4,000 in notes out. but
has received only $4,000; and still another which
has notes out for $4,000, but which has received
no money at all.
NOTES STILL COMING IN
Notes not on the company's books Mr. Girov
continued were coming in every day and were
being protested and in the absence of the miss
ing books clear view Of the cOmpany's condi-
ton could not be obtained All Of the assets /
which the receiver has been able to trace are |
pledged, either for the funding company or for /
I<eiran's loans. Keiran had a personal account /
on the funding company'S books the gross total /
Of which last year exceeded S2,OO0OOO, and nom /
inally he stands as creditor Of the company