The sun. [volume] (New York [N.Y.]) 1833-1916, 1910-04-28
BANKS LOANS TO A CORNER
MINI BlNk AND HEINxE
CORNER, S.lHS WISE.
Prosecutor DcserIbes tho Rsosslma q
uited CopVcr ~ . llSlneo gama %
HhIrh the Hama Lent An uaoWnnlS
surt p-rts Programme % Tr,al.

HhIrh the Hama Lsat An mloanlls
surt Ip--ts PrOgramme % TpIaI
Himham and bunco' was the wav
I.,"i States Attorney WIS., character.
r.,t rn" United Copper Company -oOrnsr-
. o. upening remarks 20 the Jury az the
.-al q Fritz Augustus Heinzo in tha
I.'.-i States Circuit Court yesterday,
VI Mise said that the Government would
sr,N that the Mercantile National Rank
N ~. when HeinRs was lie president
r,i ,aned out over 81 600 .Ooo Of its funds
o. H"uze's associates while they were
manipulating pool in the stock: that thew
hat even borrowed money to pay United
Cnpv.r dividends and that the Mercantile.
hat raen made a gambling institution.
H~,nze appeared 90 he a triis more IN
tar-st',d when the trial got under way with
,heSa remarks % Mr.. Wise. and when the
taAtng - testimony began in the after
noon he inspected closely tho hanks
papers that were passed 20 him by his
lawyers. He was forced to remain in the
crur, room all day. because Mr.. Wise
called the attention OF Judge HouRh 20
tho fact that on the day before he had
s'rrllet about the corridors smoking
c,gars a good deal OF the time. Mr. Wise
sali that while he didn't want 10 put Mr..
H~nxa IN custody-hs is under $50 900
hail he really thought as a defendant he
ought tn remain in the court room. and the
Court - ordered.
glimpse Of what the defence Of Heinse
l. 20 10 was permitted yesterday after the
Government had got through stating its
case and attendants began 90 file into
court staggering under the weight Of
ledgers Il the hank and ledgers oT the
copper company which the Government for
= while last fall had TO play a hide and
ssaA game with. In obiectinR Co any,
tang beng used out 81 these books unless
tho defendants connection had been first
shown. Mr. Stanchfield. one Of the Heinzs
lawyers. said that Mr.. Hsinzs vas ahnent
n-arly all the time covered by the loans in
question. that he was president Of the
tank IN name only aud that the real head
~ the hank was Miles N. O'Brien. first
vlcs-prssident. This seemed TO arouse
soms interest in the court room.
Mr. Stanchfield didn't get this objection
sustained. hut he did win another point
IN getting the Court Co rule that the evil
dsnoe should first centre on the hank
Transactions rather than on the history Of
tho United Copper Company and the his
tory e The pools in the stock. the furry
that preceded the financial storm that
came IN the fall 10 1877. More than Atty
nroA@r- from Montana and Boston were
~ hand as Government witnesses to tell
rrs story % United Copper for the Gov
eminent and this decision 80 upset thinRs
for while that an adjournment was
taken 70 allow the Government 20 get a new
start.
Mr.. Wise stock an hour and a half 20
state his case 20 the jury. He wanted
them 10 understand right At the begin
nink that he wasn't acting for the Stand
ard OH, which the defence contends 10
pursuing Heinze. Neither was he the
pro-ecu az of Charles " Morse. he said
The jury might hear that overcertihca-
ton. one Of the crimes alleged against
HeinEe. was done frequently by the banks
here. bat IL NaS nevertheless unlawful.
and ~ was also unlawful to L., a bank =
reserves get below the IS per cent legal
limit or the loan over ~ per cent 81 a
hanks capital and surplus 10 one bor-
rower. Petween June and October 10.
1871. this hank. he said. had lent tteI .OaO
N United Copper stock When on DC
tpber IL Otto Heinzs A Co. wanted half
a million more and the hank reserve
was down 20 IL per cent Heinze. against
tna remonstrsnce Of the cashier. gsEe
,r1erS. -aid MIR Wise. 20 overcertify
a check and with panic conditions threat
snng the firm oF Otto Heinze a Co took
Out from the hank total Of tt5z Gpl
without any security whatever. Al no
tune he said. was the stock worth over
So q share
will show YOU said Mr. Wise. that
utt0 Heinz. Arthur Heinze and Max
Z Schultze held the control 81 that com
frlcs ~ the stock To 10 this they took
me cash or capital oi the company and
: AID a regular ~ per cent. quarterly
81 v'dend on the $50 OF capital
stock and not out 81 earnings This
Ss- lone Ia deceive the public, the IN
norent investors The stock was 20 be
advanced through the medium Of washed
sAles such a plan was dangerous and
hazard II couldn't result In anything
h3' disaster unless there was injected
INTO ~ money beyond their legitimate
mems " was nothing short 81 a sheer
gamble Mr. Hein1e was president OF
~" United Copper Company and PRESS
dent Il the bank
Isklng up the history % the United
Upper Company MIR. Niss said that u
wa- formed in Ise2 by the merger Of ave
copper companies the Minnie Heaiy.
Z ora ard Rock Island and in one night.
-'hrough the usual Wall Street watering
! -pc"~- $40 OOO. OOO of stock vas inflated
? So fsO p0. no less than SO. 600 600 besng
I--I~i The Heinzes. he said. then sold
y" mines machinery and land !" ne
tnls money they began paying per cent.
4 ridsnds on the watered stock.