New-York tribune., 1908-03-04
FRAUD" SAYS JACKSON
4SSAILS ORIENTAL PL4N.
attorney General Denouaces 1t as
Deception of DepOsitOrs.

Deception of Depositors.
Characterizing it as "the rottenest proposition
| for looting a wrecked bank yet evolved"
| fake" and charging intended fraud and de-
| ception of depostors Attorney General Jackson
made public yesterday details OF the agreement
| between the Oriental Bank and the Metropoli
| tan Trust Company by which the' latter TO
| loan the former sufficient funds TO pay off its
creditors. That this plan did not go into
| effect due to the appointment of temporary
receivers on the application OF Mr. Jackson.
Let them show me fair. honest plan by which
all of the creditors the Oriental will be paid in
! full promptly and will myself go into court"
| said the Attorney General ''and move that the
| order appointing temporary receivers be vacated
| Or let them bring forward a responsible plan
/ by which the bank may be Iiquidated in a more
| advantageous manner than by receivers and
| viii do the thing
Under the terms of the agreement as drawn
| Mr.. Jackson holds that there is no guarantee
! that the depositors will be paid Immediately,
| and that this plan of liquidation will cost from
| a minimum of S,00000 to a maximum Of more
| than 100000 1t is said that the maximum X
! penses of liquidation under receivers appointed
! by the court would be 100000.
| The agreement provides that the Metropolitan
| Trust Company shall receive a bonus of $500,
| 600 for loanng funds TO the Oriental and interest
! at the rate of s per cent on the amount due
! them from the bank reckOned on daily balance
| sheets under the condition that the trust COM
/ pany must be paid in full within twenty-five
/ months. 1t also provides that the Hquidating
| committee, consisting of Hugh Kelly. president
of the Oriental; General Brayton Ives president
| of the Metropolitan Trust Company and James
G. Cannon are to receive salaries for their SER
/ he bLr and n
| bank committee of which Mr. Kelly Is a mem
| Der.
NO LIMIT TO COUNSEL FEES
! Another provision is that the firm of Phll5in
/ Beekman & Menken shall be retained as coun-
! sci unless the committee chooses TO designate
! other counsel. and limitation is set upon the
amount that may be paid in counsel fees Yet
another provision is that the Iiquidating com
mittee shall be held bameIess for their acts
/ except for wiIfu maIfeasance.
Attention is called to the fact that counsel for
/ the Oriental did not make public the details Of
! this agreement and that it was not read to
! depositors of the bank who have Joined in the
/ movement to oust the temporary receivers.
! 4 may have been born a farm" said Mr..
/ Jackson, but these people can't come TO me
/ and pat me on the back and get me to agree
/ to their rotten schemes They are playing the
/ part of the wolf. and it is disappointing to see
/ how readily the depostors fall in with their
! schemes. thereby enacting the role Of the lamb
| The whole pack is yapping wildly over receiver
| ship expenses using that as q pretext to cover
! up other trails"
| Regarding the proposed agreement Mr.. Jack
| son says:
| The agreement which Mr.. Menlzen proposed
| TO put through a fraud upon the deceived
| deposttors of the Oriental Bank and a license
| to loot without Interference by the restraining
/ hand of the court 1 do not know who drew
| the plan. I do know that those who proposed
| to put it through proposed to feather their
| nests at the expense of the depositors Of the
! Oriental Bank That the whole scheme was
| fake is proved by the fact that the original
| plan was doctored for my benefit and for public
| consumption after temporary receivers had been
| appointed by the court. and I have in my pos
| session the proof
| CHARGE AGAINST MIR. MENKEN-
The "doctoring'' referred 10 by the Attorney
| General he explained in this way: Monday
| night Mr.. Menken called on me at my hotel and
| showed me copy of the agreement While he
| was there. visiting me, and with officer Of
the Metropolitan Trust Company present. he in
| serted in Clause > the word Immediately in
pencil Before this insertion that clause read
as follows: The trust company does agree
/
amounts due them respectively. the total of
which the bank guarantees to the trust COM
pany does not exceed --''
The Attorney General said he was charged
with frustrating plan by which the depcstors
of the Oriental Bank were TO be paid immediate
ly and in full That charge is made" said he
by those who are disappointed because I
headed off their scheme to enrich themselves
There never was any contract proposed by
which the depositors were to be so paid, and
charge that such was never their intention. If
there was ever such a plan intended in good
faith. let the Metropolitan Trust Company. de-
posit in the Corn Exchange Bank the Farmers
Loan and Trust Company or any other substan-
TALLY sound institution the amount necessary
to nav the creditors of the Oriental. and I will
at once move to discharge the temporary re-
ceivers but the scheme must be stripped of the
features which provided fat counsel fees for
Mr. Menken. big commission FOR private receiv-
ers called uquidating officers; outrageous
bonuses and Il free hand generally for the in
siders to dip into the assets Of the bank
THE fact that Mr.. Menken carefully refrained
from acuuanting me with the details of the
plan until last night. and then not until had
demanded them in writing. is significant as in
dicating its character.
REFERS TO FORMER INDICTMENTS,
Mr.. Jackson continued his attack upon Mr..
Menken by saying that the depositors Of the
oriental should not forget that this is the
same Menken who protested so loudly when l
anDljed for receivers for the Brooklyn Bank
and the International Trust Company His pro-
tests then were followed by indictments" He
said he saw no reason why this should be an
exception. and he deemed it his duty to proceed
he