Middlebury register. (Middlebury, Vt.) 1886-1937, 1908-01-10

1eueral grand jury LOT tue ONer-ceI tIHCd-
ton of fifteen checks, representing in
the aggregate over 100000 and drawn
by the firm of Otto Heinze Il Co. on the
Mercantile National bank. +. A. HeinZe,
the copper magnate and former presi-
dent of the bank, surrendered to United
States Commissioner Shields and later
was released in $4,000 bail. He will
plead to the indictment in the United
States circuit court.
Edward Lauterbach, counsel for
Heinze, says that his client did not will
fully oyer-certify the checks. as he had
drawn Il check to the credit Of Otto
HeinZe & Co. to the amount of $500
600, which the bOokkeeper Of the bank
possibly failed to enter on the books
until a day after the certificaton Of the
checks in question.
The indictment of Heinze by the fed
eral grand jury, which has been in
vestigating the Mercantile and other
banks identified with the Heinze and
Charles W. Morse interests, is the after
math of the collapse Of the Heinze pool
in United Copper which brought about
the Suspension of Gross & Kleeberg,
stock brokers, and subsequently re-
suited in the designations Of +. A.
HeinZe from the presidency and the re-
tirement of the directors of the Mer
camille National bank after an exami-
nation of the institution had been made
by the clearing house committee.
nin n ar1 Of ba inn bnt ha ha1
been betrayed by his friends in the
United Copper pool.
Heinze had been informed quietly
that indictments charging over-certifi-
cation had been found by the federal
grand jury Dec. and that his appear
ance would be required Jan. Z, and
without awaiting the service of Il
bench warrant, in company with his
counsel, he appeared before Commits
soner Shields. The proceedings We're
short, Henze pleaded not guilty and
bail was furnished Immediately by a
surety company.
The indictment. which contains thir
ty counts, specifically charges that
Heinze, while president of the Mercan-
/
checks That is, that he guaranteed by
the bank signature that the sums indi-
Gated in the checks We're held by the
institution to the credit of the drawer
To Over-certify bank paper is under
the federal statute an Offense punish
able by Imprisonment of not less than
five years and not more than ten years.
/ l., 4 Al.
checks involved. 1t is alleged that
Heinze knew that Otto Heinze d Co
did not have to its 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 payments
of the fifteen checks drawn by Otto
Heinze & Co., and knowing that the
company did not have on deposit with
the bank sum equal to the amount
named in the certified checks. For
such an offense the federal statute pro-
vides penalty of not less than five
years imprisonment or a fine of not
more than 5000, or both.
The troubles of +. A. HeinZe began
with the bull campaign started by Otto
Heinze & Co. and associates in the
stock of the United Copper company
which HenZe had organized and de-
veloped after his long fight with the
Amalgamated Copper interests in Mon
tana. The stock was selling about
60 when a mysterious selling was de-
tected Considering it to be an effort
to raid the stock by short selling, Otto
Heinze 4 Co. gave unlimited buying or
ders to various brokers' believing that
" hen the time came the bear operators
would oe unable to cover their con-
tracts. except at such prices as the
Heinzes dictated.
Heavy selling of United Copper con-
tinued, and to purchase the stock Of
fered Otto Heinze & Co were forced to
draw checks for large amounts to vari-
GUS brokers. When the source OF the
selling was ascertained the Heinzes de-
clared they had been betrayed by
friends who sold their holdings Of
United Copper on the high market. The
United Copper stock slumped and
Gross & Kleeberg, stock brokers, sus-
pended. claiming that Otto Heinze &
Co. failed to take up the stock of the
United company which had been
bought for them.
A crisis was provoked in the affairs
of the Mercantile National bank and the
clearing house committee made an ex-
animation, following which Heinze
withdrew from the institution, but,
with his friends, stu maintained a
stock control, which he had purchased
several months before from Edwin
Gould. There have been reports re-
Gently in the financial district that the
Gould interests will again assume con-
troll Of the Mercantile.
Helie Sues 6oni For Damages
Paris, Jan. Elm fulfillment OF the
intention no announced IN Friday