New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1910-07-07
SAYS CARNEGIE TRUST
IS GUILTY Of USURY
Broker Gives Details of Commits.
sions on Loans Under Dick
inSon Regime.
GRAND JURY INQUIRY ON
Many Complications Arise Out of
Suit by Trust Company-Whit-
man Exonerates Present
Management.

GAcuoS tntnb.
A tempest with trimmings IN the form
~ usury charges against the Carnegie
--ust Company has arisen over the
bonds put Up with the trust company as
,,Ilareral for loan. The trust COM
rany has the collateral IN its possession
s,r eagerly trotted 4 out yesterday for
ne inspection no. only Of the newspaper
men but q the District AttDrLey. The
r--e grand jury has been retained be-
zar5 its allotted span TO investigate tie
-rr7is transaction It Is tLcuS1t that
indictments viii follow
The amount Of collateral involved is
;400. 0o0. face value, OF Titusville North
or Railway bonds. This road is a trac-
ron ltne IN the town Of TttusvtIIe. Penn.
v-rirh has FIVE miles Of rails actually
laid and twenty-five miles projected
TIE Carnegie Trust Company has in its
-assession 100000 OF these bonds as
collateral sEaiast 4 loan 10 Charles ".
CHAPMAN. Of c. ". Chapman & Co.
ness Is now q subject of litigation Mr.
CHAPMAN controls the other S1o0,ooo Of
bonds.
But ths original owner OF al these
bonds vas Charles z WelIborn. presi-
dent Of the T1tusville Northern Railway.
who lives n Weston. n J Mr. Well
b9rn was anxious 10 obtain control Of
TIE Tirusville Gas Company and other
public service companies in the region
about Titusville. and consolidate them
IN holding company with $4,000. 900
capital To finance the undertaking he
sent c N Sexton. q brokers' clerk in
TINS city. 70 Chapman TO negotiate for q
Loan
Chapman viii Hang On.
Tie understanding was according 10
NJ E-eIlborn. that Chapman should take
ire S4G0. Csla Of bonds over 10 the Car
negie Trust Company and get the money
for him. Chapman turned over TO Well
born S25.000, through Sexton. but only
hvpothecated $500. 600 Of the bonds with
the Carnegie Trust Company. distribut-
:ng the rest --around in different places
as sweeteners,' as he expressed il under
his control.
And you can bet I'm going TO hang
right on 70 that hundred thousand. said
r. yesterday Its the best leverage
I've get
weIlborn started the present r11mpus.
When the Carnegie Trust Company
brought SUIT against Chapman 10 re-
- F-z- Gah
ness the president Of the Titusville trac-
tin line became apprehensive over the
fare Of his bonds Thinking all the
SEQ coo was IN the trust company's pos
session. ne approached the officers, offer
ing 20 pay them the $4,000 he had OBJ
tanned through Chapman # they would
hand over 70 him the collateral This
tie company refused 70 do. and Well
bo-r went 70 the District Attorney.
District Attorneys Statement.
District Attorney Whitman had this
s-atereur 10 make yesterday concerning
TIE case
There is no evidence IN the possession
Of this Office which reflects in any way
UPON The financial responsibility or the
present management OF the Carnegie
Trust Company, or upon any Of its
present officers, OF the board Of direct
ors as a. present constituted.
As matter Of fact ali the company
business with Chapman had its tncep-
Ton while Charles Courier Dickinson
Vas president Of the company. Chap
man sa-s himself that he consulted Mr..
Dickinson personally with regard 10
ere-r question that arose in connection
With The various loans made to him by
th- Conrau-.
M-. Dickinson died recently at St
Lukes Hospital under peculiar circum-
STAGES. the cause given being the in
1aiatlon n 2 poisonous metallic gas,
While watching an experiment in a
Scranton Il boratory-. Mr. Whitman said
.esJerday that Nr Dickinson's death
Tss being Investigated indirectly by the
grand jury which has the bond inquiry
N charge
Chapman Charges Usury.
But perhaps as interesting feature as
an n The whole complicated situation is
lhapmans charge Of usury against the
tarnegle Trust COMPANY, while under
ne domination Of Nj Dickinson. These
charges are made in the brokers' an
sRer 10 the trust company's complaint
-h rs suit 10 force payment Of his in
aebtedness. he says that 1t exacted
Rom him. over and above the legal in
'erest On the loans. SI7,625 in return for
NE accommodations
Chapnan-s answer, filed IN the Su-
IRENE Court by Osborne & Lamb. his
attorney. recites that on June II. 1903,
II obtained a loan from the trust COM
ie1y q $500, for which he gave mis-
Rte. payable with interest and Usury
~ the extent Of $500. on July :. he
says lie got another loan Of $1,000. for
which be gave q note Endorsed by 6. NJ.
sexton, payable with interest and 5000
lsu-y- For a loan Of ST 900 on August
lie declares the company charged him
el--JJ commission over and above the
-7Sai interest. and for a $4,000 loan on
august 81. 500