Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1910-04-16
OFFICIAL INVESTIGATION DIS.
CLOSES APPARENT SIG FRAUD
IN SOUTHERN CONCERN.
BOB ARMSTRONG, FORMERLY
IN U. S. TREASURY, PRESIDENT
II. w. Huttis, Of Museatine. Also Ia
voIvsd-Evidsnce That Vast Sums
Were Collected and Misappropriated
Legal Requirements Apparently Is.
nored.

(! ton Casualty Company before its re-
organization here this week, under the
direction of the insurance department
of West Virginia, collected s775,114 in
one year and nine months, of which
| only $191,637 remains, that they made
pany and false returns to the insurance
department of this state, are some OF
the charges contained in the report of
John +. Roche, Of New York, consult
ing actuary to the insurance depart
lie.
secretary of the treasury under Leslie
NJ. Shaw.
The actuary found that the entire
the hands of Robert B. Armstrong,
president; G. H. Murras, vice president,
and A. S. Mitchell, secretary and treas
urer, as officers, and Armstrong Burras
and Mitchell D. Follansbee as the ex-
ecutive committee.
The company was chartered in West
Virginia about two years ago. The adj
ministrative officers have been in Chi
cago.
Three weeks ago, upon complaint Of
State Auditor John S: Darst, the direc-
tors turned4the company, over to Darst
for adjustment. Early this week the
stockholders reorganized by electing G.
c. McChord, of Louisville, KY, presi-
dent, and ]. Walter Scherr, deputy in
surance commissioner Of West Vir-
ginia, general manager.
The actuary's report states that the
condition Of the company's books is
such that a correct audit is almost inn
possible. Among the Irregularities
charged. is the cancellation of stock is
sued, the collection of partial payments
from which nothing was issued and the
issuing Of stock which was not paid
for. The actuary recites that President
Armstrong drew a salary Of $1,000 per
month ION June 30, 1909" the report
says, 1T was discovered that he (Arm-
strongly had overdrawn his salary So
S12." Subsequently this overdraft of
salary was charged to miscellaneous
expenses"
The report charges that in 1909,
when statement was to be made to
the insurance department of West vir-
GINA, HI. w. Huttig, of Muscatine, Ia,
who had been party to the deal, with
the company's officials for various
stocks and bonds loaned the company
a note for $4,000. This borrowed note
the report says, the company showed
as an asset In Its December statement
and the officers took oath to that eff
feet. The charge is also made that
bonds returned by the company as
assets in its sworn statement were not
owned until after the statement was
fled.
The report says that those having
charge Of the management of the COM
pany owned but fifteen shares of
stock and that was In the name of the
president. Tho there was a resolution
passed that directors must be stock
holders. the following directors are not
shown on the books as stockholders:
NJ. NJ. Boutelle, Minneapolis. Mimi;
C. H. Burras and Mitchell D. Follan-
bee, Chicago! n. w. Huttig, Musca-
City: James H. Peabody, Denver.
Among the various charges made
against the former officers Is one that
real estate in Chicago worth $4,000
was returned in the company's state
ment as worth $4,000. The property
cost the company $11,500
Armstrong Denies Report.
Chicago, April 16. Following the
report issued by John f. Roche, of the
West Virginia insurance department.
that prior to reorganization of the
Consolidated Casualty Company, which
is said to have 1000 stockholders in
many states, Robert Armstrong, former
president. issued a statement today
denying the charges OF Roche that he.
with other managers Of the company,
had made false returns to the West
Virginia insurance department, made
false entries in books and that Of
100000 collected in twenty one months
by the company less than 100000 re-
main. -. : 49,
Armstrong says there has been an
effort made for two years by compete
tors to assassinate the company for
refusal to maintain rates and join the
surety trust" and denies all charges
of Irregularities. He says Roche's re-
port is Incorrect and misleading.
The administrative Offices Of the
company are In Chicago, tho the COM
pany is chartered In West Virginia.
OPERATOR STILL MISSING.