The sun. [volume] (New York [N.Y.]) 1833-1916, 1911-04-23
BANK DEPARTMENTS DEFENCE
~ LOOKED 70 CARNEGIE 70 SEE
vHE TRUST COMPANY THROUGH

n LOOKED To CARNE(1IE To SEE
vHETRUST COMPANY THROCGH
And supposed II HAD Assurances That He
|. would Superintendent Cheney and
Mr.. Carnegie 70 Go Before the Grand
4 Jury-More Questions for Cummins.
Ranking Superintendent Orion II.
Cheney has told Gov. Dix and Chief Exam
,c.r NJ. ". Hutohins has told the Grand
,Iurv that the only reason the Banking De-
psrtment permitted the Carnegie Trust
company to stagger along after April
1910 was assurances from Andrew Car
nerie that he wouldn't let the trust COM
panv go under.
In the written report that Mr.. Cheney
vill send on Wednesday next to the Gov
amor it will he said that the Bank Depart
rent was led to believe by Mr.. Carnegie
,ha, he would come to the rescue Of the
carnegie Trust Company for third time
and that when Mr.. Carnegie. on January
2. 1911. four days before the trust company
,,opped, turned his back on the suppli-
cants no persons interested we're more
surprised and disappointed than the
Bank Department officials.
The Superintendent and his chief ad-
y,.ers didn't take the word Of W. j. Cum
minis that Andrew Carnegie was ready
N shovel in more cash or steel bonds.
nor did they rely on the assurance given
by President Joseph T. Howell OF the
Carnegie Trust Company that Mr.. Car
neeie had told him that everything would
b. all right. Instead. they say. they went
70 headquarters and saw the captain
and things looked 40 promising there
after that the trust company vas allowed
TO wabble along with a greatly impaired
reserve and a collection Of junk assets
that Mr.. Cummins had found useful in
getting the money.
The report to be made to the Governor
by Mr.. Cheney will be essentially defence
Of the Bank Department and an answer
70 various criticisms that were sent to
the Governor and by him referred to
Supt Cheney. Many depoeitors. 1t will
he recalled, wrote to the Governor and
asked him why Cheney let the Carnegie
Trust dribble along when he knew that
II Was . wrecked concern.
The backbone of the Bank Depart
ment' g defence will be the assertion that
Mr.. Carnegie promised to make good
and didn't. II is likely that Mr.. Cheney
willincorporate in his report substantially
what Chief Examiner Hutchins told the
Grand Jury-that the Bank Department
kept hands OF because r.. A. Franks
Mr.. Carnegis's psssonal representative
and willard A. Mitchell. cou(sel for Mr.
franks. participated a number OF times
in conferences with the Carnegie Trust
directors and Bank Department officialf
and told all hands that it was Mr.. Car.
nesie's desire that the company shouldn' I
he closed up. Mr.. Cheney's report. il
is understood. will contain copies ol
letters from Mr.. Canege's representa-
tives.
Mr. Hutchins testified before the Crane
Jury that the Carnegie Trust Company
would have been closed in 1907 il Andrew
Carnegie hadn't come forward with
81 900 900 and that it would have beer
shut up in january, 1910. IL he hadnt
made another loan of $2,lOO.OOO. Natu
rally. as the Bank Department ofhciah
aver, they went to Mr.. Carnegie in April
1910, and in August. 1910. to see whethe
Mr.. Carnegie still felt friendly towart
the trust company. They wanted Il
sve the depositors . chance. Hutchin
testified and Mr.. Carnegie said that wa
right and he would see that the compan.
didn' t come to harm.
Mr. Hutchins made or supervised th'
Las. three examinations into the ahair
of the trust company. Back in Novem
her, 1900. he dug out Of the vaults fou
100000 notes that Cummins and asso
ciates had planted there when they 60
the company's cash TO buy the Van Nor
den banks Mr.. Hutchins looked up tn
standing Of the makers and had . warn
talk with Cummins, That paper had I,
he removed and the money put back, sai'
he, or something was going to drop. Mr.
Cummirs got busy. Clark Williams
Chenay's Predecessor. wrote a letter 4
Mr Carnegie which Cummins delivere,
in person. II was a nice letter. MY
Cummins's ability and integrity Of pur
pose were mentioned and something wa
sald about his sincere and praiseworth
efforts Anyway Cummins got what h
vas after--money to take up the fou
So,es
This episode had good deal to do wit
establishing confidence in the Bank De
psr,ment that MIR. Carnegie would
somewhere around when called on,
In April, 1910. when Mr.. Hutchins ex
amined the company. things were prett
bad There was poor paper in abundanc
and an impaired reserve. Mr.. Cummin
made his usual talk: My friend Car
nsge will make good"
And do you suppose we took Cum
ninse word for it?" said Hutchins befor
The Grand Jury. "We most certainly di
no,
Assurance was got from Mr. Carnegi
himself that nobody need worry. In tn
months that interviewed before the mex
semi-annual examination the depart
ment kept close watch on the trust CON
Tany. Half dozen confere ences or NOR
we're held by the company's directors. tn
department officials and Mr.. Franks an
Mr. MITCHELL representing Mr.. Carnegie
heae ppnfarannoa Warn AZ sat iafa nj mr.