New-York tribune., 1909-12-30
COMPANY SOLD OUT?
CHARGE.
Order against Fraternal So
ciety Granted by Justice.

Albany, Dec. 29.--Alleging that, tempo
rarily at least. the Peoples Mutual Life
Insurance Associate and League, a
so-called fraternal beneficiary society, with
headquarters at Syracuse, furnished the
money with which control of itself was pur-
chased by representatives of the Federal
Life Assurance Company of Canada, At
torney General OMalley obtained an order
from Supreme Court Justice Andrews. at
Utica, to-day, returnable at Syracuse on
January S, directing the society to show
cause why the State Superintendent of In
surance should not be put in possession of
its business pending the determination of
the question whether it should be Iiquida ted.
A recent investigation by the Insurance
Department showed. according to a state
ment isseud to-day by Superintendent
Hotchkiss that five of the nine members
of the board of directors resigned at a
meeting on December 81 and their places
were taken by five persons who previously
had been practically strangers to the So
ciety. and who it appears, represented the
controlling interests in the Federal Life
Assurance Company of Canada.
Their action seems to be a part of a
scheme" says Superintendent Hotchkiss,
whereby this society will be merged in
that foreign corporation. not yet admitted
to business in this state and, because of the
smallness of its paid-in capital, not even
qualified TO apply
"On the same day, December q, upward
of $150,000 of the securities of the Syracuse
company were so disposed of that an i'm
mediate transfer of $150,006 was made to
the Farmers Bank of Canada, at Toronto,
such bank issuing through it's manager
then in Syracuse, pen written certificate
of deposit payable only after three months
notice. Such manager, at the same time, ap-
parently as the agent of the purchasers of
the control of the Syracuse society, de-
livered $4,000, which was, in whole or
part, Immediately distributed among the
old directors, as. it is understood, the con-
sideration for the resignation of certain Of
them and the transfer of the control to the
new directors paying such consideration" ="
The retiring directors were c. F. Wayte,
S. S. De Barr and Slater Laycock, of SYRIA
cuse; H. II. Mondon. of Port Jervis, and
j. h. B. Santee, of Hornel. Their places
were filled by William r. Garrison ana
Edgar Madden, of New York; NJ. q. Hunt,
of Toronto. Rudolph Appel. of White
Plains and Edward l. Vezina, of Syracuse.
The society has assets amounting to
about s., 100000, and Superintendent Hotch-
society did business to make no payments
and to deliver no securities without author
ity from the department
Since the incorporation of the society in
1903 1T has operated largely in New York
and Pennsylvania BY complicated sys-
tenn of so-called assemblies-national. fed
eral. district and primary-the voting power
of the members is dissipated, and the con-
troll Of the company is vested in the board
of directors There has been a falling off
in membership from 56,136 on July l, 1903,
to So 7S5 on November l last.
Syracuse, Dec. 29.-I. c. Reed, president,
and ". H. Peck, secretary treasurer of
the Peoples Mutual Life Insurance AS
sociation and League, denied tonight that
there had been any irregularities in the
management of the society's affairs.
They regarded the action of the State In
surance Department unwarranted.
That there was a bargain by which the
directors were to profit was denied, and
both Mr.. Reed and Mr., Peck said that
the $4,000 referred to by Superintendent
Hotchkiss was deposit in the Farmers
Bank of Canada at AZ per cent inter-
est. The assets of the society, they said,
are more than s3,000Co0.
There has been no merger with the
Federal Life Assurance Company of
Canada" said Mr.. Reed, "and there has
been no transfer of business or property
TO that company. 1t was not the purpose
to close up or merge the society, but by
an association of interests to do business
together. The money was deposited in
the Canadian bank al ~ per cent inter-
est. There have been no irregularities or
bargains