The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1910-03-26
RULES ON TRUST COMPANY
Insurance Commissioner Investigates
Affairs of Southern Trust Company.

Columbia, March 1S.-The South
ern States Trust Company, of this
city, which has been under fire in the
courts of this State, was this after
noon the subject Of a ruling as to it's
bonds by Insurance Commissioner
NC Master. 1t is stated in the letter
OF the insurance commissioner to an
inquirer that the company is going
to liquidate about April l.
There are several matters in the in
Vestlgation by the commissioner that
are of interest, because the things
| brought out in former suits against
the company, when efforts were made
| to put it in the hands of receivers
are hinted at in this report. The
charge made against this company in
the proceedings before the court here
was that the promises of loans could
not possibly be fulfilled, as persons
on waiting lists could not be reached
| under the plan pursued.
The insurance commissioner takes
up in detail each series of the bonds
issued by the company. Taking up
one series will show the point aimed
at in the report. In Series "a" there
were 500 bonds. In these bonds s2O,-
6S2.62 went to the expense account
and $2S,921.50 to the loan account.
Loans were made to eleven persons
on twenty-five certificates, to the
amount of $24,703.5O On March 1
the total amount credited to expense
fund was $36,127.1S. The amounts
crediterd to the loan account were
$2S,921.5O. Of this amount, $24,7O3.-
SO was loaned. The commissioner
points out that some amounts put into
surplus funds should have been turn
ed into loan fund. The contributions
made by those who allowed their con-
tracts to lapse after the first twelve
months in Series "a" amounted to
$4,565. Summing up the situation,
the insurance commissioner states:
Under the head of general COM
ments, 1t may be worth while to note
that in Series "a" of the amount
loaned, s24,7o3, that $4,000 was loan
ed to Mr.. Barrett himself, September
25, 1908, on four contracts purchased
by him from original or secondary
holders. So far as the books show,
up to date, only $S9.22 has been re-
paid by Mr.. Barrett on this loan. OF
the remainder, loaned to ten other
persons in this series, $2O,702.5O, the
total amount paid in by these ten per-
sons was $3,2S7. Of this total amount,
however, they received credit for only
S2,133.S3. The balance Of their pay
ments having passed to the expense
funds. OF the amount loaned in Sc
ries "B" $10,640, to seven persons,
these persons had paid into the COM
| pany $1,3O3.1O, but received credit
only for the amount they had paid
into the loan fund $7S7.S0, the bal
ance of their payments going to the
| expense fund.
| OF the amount loaned to the two
persons in Series &c" they had paid
into the company 5000, but they re-
ceived credit for only $11O.65, the
amount paid into the loan fund.
This is the whole story, except that
at the time of the examination of the
company the bank books shows me
put to the credit of the expense funds
$161,75, and to the loan fund s77,S3.
The cashier informs me that so far
as he knows, the Southern States
Trust Company carries no other bank
accounts, but that securities Of the
company, which consist of real estate,
mortgages and notes of those to
| whom loans have been made to the
amount Of $4,000 are on deposit with
the Georgia Trust Company, in ac-
cordance with the laws of Georgia,
but L understand the company has
larger liabilities in Georgia than it
has in South Carolina. l have been
given to understand that the Barrett
Investment Company has practically
| purchased all Of the outstanding con-
tracts of the Southern States Trust
Company, in South Carolina, save "A
in Series "a" and eight in Series "B"
and seven in Series "C". 1 have been
further advised, both by the attorney
or the company and by Mr.. Barrett,
that most energetic efforts are being
| made to close out the affairs of the
company and discontinue business be-
fore April l, of this year"