The Daily Missoulian. [volume] (Missoula, Mont.) 1904-1961, 1910-04-18
FIRST INQUIRY INTO MUTUAL
LIFE INSURANCE compANy,s
AFFAIRS is FINISHED.
.HOTCHK|SS DOES WORK
A Change of Conditions and Methods
OF Doing Business Since the Scandals
OF the Hughes investigation Is
Shown in the Report Made-AHars
Look More Favorable to Company.

! New York, April 1.-THE first IN
/ vestigntion Of the Mutual Life Insur.
/ ance company undertaken by the
state since Governor Hughes uncovered
] the scandals of 1905. has been COM
| pleted by Superintcndent of Insurance
/ Hotchkiss and develops these facts:
! ]. The final efforts Of the new man
/ agement to recover s3.00O.O00 from the
| late President Richard A. McCurdy
and his associates of the old manage
ment resulted In a net outgo of s237.-
3ls more than the company received
from the McCurdys.
= Since the Armstrong law went
into effect the Mutual's expense OF
/ maintenance and administration has
dropped from si5.a20.9l0 in 1904. the
year before the Armstrong lnvestiga-
tion. s7i151s6 In 1908, while the vol
ume of business remained about the
same
3. As late as 1906 agents of tho COM
pany were still active campaigners In
the interests of directors seeking re-
election, although the report does not
charge this was done AT the instiga-
ton of the directors themselves or
with their connivance. For these
electioneerlng services agents Of the
company received In 1906 si6s,35i OF
policy holders moneys.
T. AS late as 1908 payments To
agents aggregatlng s35i.iii. which did
not appear on the books of the COM
pany as bonuses for getting new busi-
ness. but are nevertheless believed By
the department To he such. paid In
violation of the Armstrong law. were
traced to the Boston office. There Is
no record of them In the home Of
flee. In Boston they are charged to
supervision of old business. which In
to say. to prevent the lapsing sc old
policies.
Deceptive.
Superintendent Hotchkiss character
lies the report submitted by the COM
pany's committee which recommended
the acceptance of the compromise
with the Mccnrdys as untrue in at
least two particulars and deceptive In
one more
And 1t seems To us" he continued.
either the committee did not know
the facts or purposely misled the
board of directors"
/ Nevertheless, II Is said the report
on the whole is complimentary to the
company. The examiners find the COM
pany has complied in the main with
the insurance law as named by the
| Armstrong committee"
The examiners believe the expendl-
| mn ar he, b..I
questionable purposes has been def
initely ended
The examiners state" says the re-
port. proper restraints have been
| placed by the company upon the sup
| ply department. where expenditures
for Legislative and other improper pur-
| poses were concealed by the previous
managements and the system at pres
ent viii prevent the recurrence of such
| practices"
Returns Increased.
! Returns to policy holders have been
| increased eorrespondingly Dividends
paid in 1904 amounted To $2674,20G.
and in 1908 To Ss3.3ll,255. The report
! explains, however one reason for its
significant increase was that many de-
| ferred dividend policies matured dur
ing the years l907-OS. Charles A. Pea
body, president OF the Mutual Life In
suranee company. when asked To COM
ment upon the report, said:
The only subject In the report of
| the examiner of the department re-
! During comment Is that relating 10
/ settlement Of the company's claims
against former officers of the com.
! pany,
The proposals of settlement were
! referred by the board of trustees 10 "a
/ committee of trustees consisting of
/ Benjamin T., Tracy, lawyer; Edwin $.
Marston, president OF the Farmers
Loan & Trust company; II. Rieman
J Duval. president OF the American
Beet Sugar company; II. w. Taft, of
Strong K Calderwalder, and F.. H.
Eaton, president of the American Car
& Foundry company. None OF this
committee was connected with the
company during the period In which
these claims arose.
This committee acted under the ad-
vice and approval OF Messrs, Joseph
! Choate and James McKeen the COM
pany's counsel having the matter In
charge They held meetings extending
over three weeks, examined facts and
circumstances upon which the claims
of the company We're based and made
a report 10 the trustees recommend
ing the settlement which was after
ward made. The examiner OF the In
surance department has reached u diff
ferent conclusion on the same facts
and circumstances.