New-York tribune., 1909-02-10
FEDERALRECETVER OUT
FIDELITY co. DECISION.
Referee Holds Keiran Concern NOT
4menable to Bankruptcy Act.

z,.., 2 yo;rex referee in bankruptcy, submitted
20 the Judges of the District Court yes'eoaS i.l
oririor in the proceedings against the F1oeh'y
,-,,n5inr Con1pany Of which Patrick j helrah was
formerly president. he held that inasnuch aS 1Ie
company was not trading or neTcail'l'e Oo1 loi
ton /. was not amenable TO the bankruptcy at
His report said
Whether We consider the Fidelity Funding Sol 70
pay rePslly engaged an, I9 en9ipg S3iFftions e Upon
various Ca'hoilc b or1eares or principally
engaged in buying and selling pTomlssoTy no NOTES az.
= = Is noI smena6e to the bankruptcy act ana
cannot be adjudicated bankrupt IN ll'No'1'''-'
t5ereY5re report that in my opinion the petition
Of tSs pefi,foning creditors most ne dlsnsSeu' VIZ"
costs.
Bearing OF Keiran's transactions he SAID
The loans Of the company during ifo {ne y dollars
appear have amounted to a aboqi aItaI 10 trans
- Tfs large amount Of business. It was opIig ;@ @
OF the borrowers -, al -3ty of mortgages II sold
carry on its business
In a supplementary statement Referee olley sa-' "a.
,rer -be question involved the custody ana aolli'
tsra.ion Of aesets Of estimated value OF seVer
million dollars ....
when Frank 1. Crocker, Of No, Nassau stree"
counsel for the federal receiver. Mr Morris, vas
Informed OF Referee Olney's decision ne said 'iIa
he 1ro1II5 appeal At once the District Court ana
IN the event Of a unfsvorable decisloh "ouiu '0l
The case 10 the Court Of Appeals
pr C4ilroy said that henceforth he Would oe 'iie
s-le receiver and would remain SO until Re1eree
Olney's opinion was reversed ,
M Keiran said the decision was In accord Win
his ,v, orinion and that although he would rather
have q federal receiver than state receiver 'le
decision was entirely agreeable TO him
The hearing in personal proceedings against hel-
an VIII continue to-day before Commissioner
Alexander in the Federal Building. Keiran is ex-
r,ected 10 appear under former subp9nas; d h
Siu who succeeded him as president ana d n
Mcbride. a director have been requested 10 ep-
pear. and subpoenas viii be served this morning
on several bank officials and directors who hold
the companys paper
Nr. heiran said yesterday
The Fidelity Funding Company debts will be
rsid in full and the churches and other institutions
will not be required pay anything more than
she nancy that was advanced 10 them plus the
interest 10 date. The churches do not want any
compromise their legal Liabilities; they are Will
ing TO pay every dollar that was advanced 10 theln
by the Fidelity Funding Company. and whether
their obliFatlors were legally Illegally issued Is
rot material with them
During the summer committee was organized
consisting Of Morgan J. O'Brien, J. S. Alexander
,1ce-oresident Of the National Bank Of Commerce
and George W Young Of George ". Young & Co.,
Of No 81 Cedar street, for the purpose, as l un-
derstood Il; Of looking the affairs Of the F1del-
fly Funding Company with reference TO lenolns
such financial assistance as was required
1t was decided that I should resign the presl-
de7cv and D H Sill took the Office A part Of the
capital stock was trusteed 10 the Windsor Trust
Cornpany with the understanding that the com
rnitiee would have control Of the company for
period Of three years. and majority Of the stock
holders signed the agreement was TO remain
director.
The active mana cement Of the company from
that date fell 10 Nj sill who required that suf
f7ci.1t number Of the directors should resign so
that he could appoint new ones from his office
force and have them hand when needed It
was stated 10 the directors that by doing this the
company would set such financial assistance as it
required.
Although ! was in the Office every day. I was
not called n to any Of the meetings nor was 1
present when Il was voted 10 apply for receiver
shin for the company Nor did know anything
about such 4 resolution beins passed until heard
of the receivership being applied Tor. I volunteered
TO assume ali the thirty-day obligations Of the
company. and offered put I'd credit from S250r0
70 S.5Oaaoo effort 10 stay the receivership
but was refused