Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1909-10-05
U. S. Circuit Court Of Appeals
Atfirms Verdict OF Guilty Of
MisapplcatiOn of Funds.
SENTENCE FOR FIVE YEARS
Counsel Have Thirty Days in
Which to File Application
For Rehearing.
Meanwhile He VIII be out ON Fifty
Thousand Dollar Bonds-Story of
Chicago Bankers Rise and Fall.

Ch.pgo. oct 5.-The verdict of tho
trial court which found John r.. walsh
guilty of misapplicatlon OF the funds Of
the Chicago National bank. was ar
hrmed by the United States circuit
court of appeals here today.
Mr. Walsh must serve the sentence
Of FIVE years imprisonment imposed
upon him by the trial jury. save i'm the
event that the supreme court upsets
the affirmation OF the guilty verdict
handed down. Counsel for Mr. walsh
In their appeal laid stress on what thew
alleged was a lack Of criminal intent
on the part Of the defendant. In the
very lengthy brief which they filed.
much law was quoted TO show that IN.
convicted banker used the funds OF the
bank in what he considered a legit-
innate manner
OPINION OF COURT
The opinion OF the court Of anneals
written by Judge Humphrey and hand
cd down by Judge Grosscup. is brief
and confined almost wholly 10 the oues-
ton OF criminal intent The allegation
that Juror Palmer was undulv I'M
fuenced is dismissed with a word. and
but little more is wasted in eliminating
the allegation ~ Inconsistency in the
verdict
As 10 the substance ~ tho matter
charged in the various counts saws the
opinion, "the verdict win not be dis
turbed. II tho eravaneu Of the charge
IN each count on which there has been
a verdict OF guilty is the same there
Is a consistency in the verdict
In the instructions given the Jury by
Judge Anderson IN the trial court. the
higher tribunal finds no error. As IN
the lack Of criminal intent the opinion
reads:
Under section 5000 there could be
misapplication Of bank funds By an ON T.
Ger which would be Innocent and not
criminal and there could be rnisappH-
cation which under the statutes would
be criminal What would show the
difference between Interpretations
which were criminal and those which
were not what would show innocence
or guilt good faith or bad faith. tho
court sought by instruction carefully
to define and We think did fairly de-
fine"
Counsel for Mr.. walsh have 80 DAYS
in which 20 file application Tor a re-
hearing by the court Of az peals Mean
while he will be az liberty under his
present bonds OF $4,000.
WALsHs RISE AND FALL.
The rise and fam Of the fortunes n
John r. Walsh. who is now az years
of age. forms an Interesting chapter
H. the history OF Americans who have
risen from obscurity to power.
The three Walsh banks-the Chicago
National, the Equitable Trust compspy
and the Home savings bank, we're
closed by the comptroller Of the cur
reucy on Dec. rs. 1905. nearly four
years ago. AT that time Walsh not
only owned these institutions and the
Chicago Chronicle but owned all or
nearly an u the stock OF the follow
ing companies:
The Acme Gas company the Bedford
Belt Railway company, the Bedford
Quarries company the Chicago south
ern Railway company, the Chicago
Wharhng a storage company the
Indiana Southern Coal company the
Illinois Southern Railway company
the Lake Michigan Car Ferry Trans
portation company, the Mount Olivo A.
stanton coal company the Ohio Qucr-
ries company OF Ohio. the ohio Quar-
rics company of Illinois. the South-
crn Indiana coal company. tho south
ern Indiana Railway company tHs
Southern Missouri Railway compan.
and the Wisconsin a Michigan Rail-
way company
According 20 the brief of the govern
ment on the appeal an of the come
panics were bankrupt or on the verge
of b. when bought by Walsh for lif-.
tie or nothing Their securities We're
unmarketahle and practically worth
less.
Then. it is alleged, Walsh formed
corporations 90 buy these companies
from himself taking in payment stock
OF tho new corporations and enough of
their bonds Co repay himself az thor
face value Tor tho sums he actually
paid FOR them
Nm this way. according To- tho proso.u.
ton. he obtained for nothing stock,
ana bonds % the face value M $4,000
WAISTS DREAM
walsh dreamed great dream of
railway system to ho pieced together
from his scattered purchases whi ID
would reach from the Mississippi tp
the ohio. through Illinois Indiana.
Wisconsin und Michigan. to Duluth.
MINI. aud superior Wis Tho quHr-
lies and coal mines were to furnish
much OF the traffic
To obtain funds walsh bad recourse
% the funds Iu his banks. Don covering
40 these loans no is alleged hr uH"
memorandum notes signed with Che
names OF clerks who were NOT consulted
DOB the matter There was nothing on
the books tn show that Walsh had rr
celved the loans Even Fred bl0uuf.
me vice president. ls said i0 have hefl
ignorant 1n the subject For collaterHI
Walsh deposited The securities of DTS
various rnterpri,es
For two years it Was charged tha
Walsh ignored the demands of th
comptroller of tho currency thar Dr.
place his banks on "A Arm foundation.
and when the crash came n Was dis
covered that 66 per cent m tho secure
lies held were those M WHlahs uroper.
fI.a ar fnn fnl nnl 600 1ouuaIfa ana NH