Eagle River review. [volume] (Eagle River, Wis.) 1890-1927, 1909-10-08
BANK OFFICIALS
FACE 4 SCANDAL
SENSATIONAL CHARGES ARE MADE
AGAINST ALLEGED WRECKERS
OF MICHIGAN INSTITUTION.
PRESIDENT COMMITS SUICIDE.
Receiver Brings Suit in United States
Court for Recovery Of $50
Shares of Stock.


MARQUETTE, Mich, Oct 2.-ESpe-
ciaL sensational charges against Ed
ward D. Nelson. former president of the
institution. are made by Philip Tilling-
hast, receiver of the defunct First Ma
tional Bank of Ironwood, in a suit
brought in the United States district
court. Jointly with Nelson, Elvin t.
Larson and Chester G.. Rogers, the lat
ter as administrator of the estate of Her
man &. Jain. are named as defendants.
Larson, who was the cashier of the
bank. is now serving seven-year SEN
tence in the Detroit house of correction,
having pleaded guilty to various offenses
when arraigned here last month, and
jain. who was its president, is dead
~ his own hand. having committed sui
de only a week prior to the opening
oI the recent term of court.
The receiver asks that the sale on
o33r shares of bank stock by Nelson to
Larson and jain in January, 1906, ba
declared void. and that Nelson be COM
PEELED to return the full value of the
shares. which it is claimed were dis
posed of for $53.S5O.
Bank Was Insolvent.
The bill of complaint sets up that when
the sale was made Nelson was president
of the bank, jain was vice president,
and Larson cashier, and that the three
held AGO shares of the stock of the lnst1-
Triton. 1t is alleged that at that time
the bank was insolvent and was known
to be insolvent by the three defendants;
furthermore that Nelson personally owed
large sums Of money to divers creditors,
who were threatening bankruptcy pro-
ceeGings against him.
Tn tha Nelson might he able TO
pay these creditors, it is charged that he,
Larson and jain conspired to sell Mel
sons stock This stock amounted to 339
shares, it is stated, and it was purchased
by Larson and jain for $53,S5O.
In consideration of the transfer of the
securities, it is alleged, Nelson received
$4,000 in money and the balance in cred
its notes, etc, all of which were a part
of the credits of the bank, and not the
property of Larson and jain. These
credits, as separately set forth in the
bill of complaint, appear to be largely
notes held by the bank against jain or
Nelson Or public service corporations i'll
which Nelson is generally believed to be
d controlling stakeholder. Among the
corporations named are the IronwooC
water works and the Ironwood and Hur
iay electric light and street car system.
Knew of Ownership.
It is alleged that Nelson received these
moneys and credits with full knowledge
that they belonged to the bank and not
to Jain and Larson, and that Nelson
ccETerted the moneys so obtained to his
own personal use. 1t is further claimel
that, with Nelson's knowledge, false
entries were made in the banks books
to cover up the transaction.
For all these reasons Receiver III
lsnghast asks that the sale of the 35H
shares of stock be decreed to be vcic
and set aside and, furthermore, that Mel
son be compelled to account for anC.
make restitution for the full value Of
the credits and money so alleged to have
been delivered to him.
The suit is likely to be only ole of
many litigations in connection with the
Ironwood bank failure that will come
up at the next term Of federal court
here. IN fact, from a court standpoint,
it is evident that the settlement of the
affairs of the defunct First National has
only begun.