The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1910-04-16
Former President of Consoli-
dated Company Replies to
Report of Actllary.
MISMANAGEMENT AND
CLASSIFICATION ALLEGED
Ex-0fficiaI Declares Organized
Effort Has Been Made to
Break the Company.

CHICAGO, April l5.-Replying 10
charges of mismanagcmcpt aud falsii-
ca, ION of accounts made today against
Ro )ert p. Armstrong. former president
of the Consolidated Casualty company,
by John +. Roche, the actuary, at
Charleston, w. Va, Mr.. Armstrong to-
mis- hi issued the following statement:
''Thc report of Mr. Roche reflects the
hostility winch tue company has en-
countcrcd from its inception. For prac.
tic ally two years there has been ap.
pa entity an organized effort to assassi-
maze the company. These guerrilla meth
odf of the competitors of the com
pauy were encountered on every side,
an enormously increased the expense
of organization. ! have been warned
scores of times that the Consolidated
anil myself would be put out of bust
ness. The president of one company,
member Of the Surety trust. told me
tho only hope the Consolidated had in
continuing in business was to Join the
Surety association. More recently
bac been warned that the failure to
maintain rates would mean annihilation
Of the Consolidated.
Effect of Warfare.
"This warfare Of combined interests
on the Consolidated prevented it from
being licensed in q number of states
where il had spent money and time 60
sc' urc stockholders and complete
az ncy organization.
The plant was equipped 10 occupy
held which was closed 10 il. 1t was
equipped to do business along a number
OF lines which the opposition TO The
company prevented.
a" In addition 10 the tangible assets
the company has, it has an agency
organization. and practically thousand
stockholders scattered ia Il number of
states. aud still has an opportunity 10
succeed IT given a chance. If, al any
limc during the last two wears. tho
orfSpizatlon has been abandoned and
liQiidatcd, the stockholders would have
lost heavily. As il is, they have an
opporiunity ultimately TO realize their
original investments and earn dividends
on the amounts paid in.
Temptation has been very strong
during The last year for me 10 throw
up my hands and abandon The company
| have stuck 10 my task, however. as a
malter of duty 10 the stockholders.
have not benefited from the two wears ;
work | have given the company. u
large part of my salary being spent in
expenses necessary TO ORGANIZATION
There has been nothing irrcamiar =, to my nv
knowledge, In the conduct of the com
pany- If mistakes were made, they
were mistakes of Judgment. and such as
usually come IN the organization Of n
new proposition
Denies Roche S Figures.
The statement of Mr. Roche is un.
m : n ,l1
lars. Without having access TO the
records, should say the item Of income
was approximately correct The i'm
preston is given that the assets of the
company have been dissipatcd until only
Sl9l.O .O0U remained. This is practically
ln'true.. The latter figure is arrived al
by sealing down values and throwing
out Of consideration bank accounts and
other good assets. The assets of the
company are some place between $780,
600 and 100000, and the difference
between this figure and the income is
represented by disbursements of prop-
erty accounted for.
That the management made false
entries in the books of the company is
also untrue, as is the statement that
false returns were mado TO the inslr-
ance department of West Virginia. In
correct entries on the books were dis
- Reference rs made to the borrowed
note, which it is claimed is improperly
Included in tho assets of the company
on the 3Ist day Of December. This
note, with collateral, was taken in OK.
change for other security, which. under
the contract made with Mr. Hutting,
was due the company at that lime. Had
The company been allowed 10 complete
it's contracts with Mr.. Huttiug, this
note referred 10 as % borrowed" would
have been exchanged for other sccuri-
ties 10 be delivered to the company by
Mr.. liuttine under his contract
'Thc cbarge that bonds returned BY
thc company as assets were not owned
until after the statement was filed. is
absolutely untrue. The contract WAS
closed. for The delivery of these sccuri-
ties and thc stock exchanged for il in
tic latter part of December.
Explains Stock Issues.
"Tbe company has the right under
lis charter 10 buy back its own stock
Therefore, there was no irregularity in
the cancellation of stock issued. 1t
was understood partial payments in
81 ock which were not completed would
b. forfeited To the company.
EDuring the period of organization
tic bylaws did not provide directors
SHOULD be stockholders. At the an
Uldl httllHg III JHnuHlF InlS WHS
changed, and IL was then required di-
rectors should be stockholders. The
| gentlemen referred TO in the report
had simply not qualified by the pur-
iase Of stock.
~''Iu regard to the valuation of the
,lilding purchased in Chicago for the
yecutive offices OF tho company, the
hole transaction was clearly SET fort
lii the statement; thc cost, Sl1. 500 was
seated, AS WAS tho depreciation esti.
mated by the company, $3S. 800, Three
appraisers, who were reputable real es-
tate men, placed n valnc on the prop.
e;ty in excess of $4,000, and the direct.
o4s. after n careful examination Of the
property and the appraiscmcnt, made
Continued on Page Two.