New-York tribune., 1911-02-25
A NEW YORK MAN NAMED
Said to Have Backed Purchase OF
insurance Securities.
A DENIAL is MADE HERE
Testimony at Harrisburg GlVes
Further Details of Keystone
Guard Transaction.
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fPv Ts',rr.nh 20 Tse Tribuns
Harrisburg Penn Feb. 2i--In the inquiry
into the affairs Of the Keystone Guard TO-
day 1t was alleged that an aggregate o.
S00C0 was paid to the officers and directors
who sold out the Pennsylvania insurance
society. David X. Mills. said to be an
officer Of financial institution in Ne"
York City, was named as the man who ad'
vanced the money.
Mills. It was testified. did not pay over the
go 900 until after he had been permitted 10
examine the s2ssooo OF securities in the
safety boxes Of the insurance society' As
soon as he had satisfied himself tina. these
securities were all right, II was said' the
5000 was paid TO the waiting insurance
officials, and the New York brokeras'
clerks, said TO be backed by Mills. were per-
nlitted TO take the $2S90J0 IL securities 10
New York II was testified that the Ne"
Workers surrendered Their safety deposit
boxes in Athens Penn. a few days stteT
they had paid the insurance officials
What became OF the insurance company
marketable securities after they were TAKEN
TO New York was shown by detaiiea re-
port OF James VI. Gooiell. trustee ap'
pointed later TO get the securities oach
from the New Workers. According 10 this
report. all Of the s2S9.0N except slo'No Oh
Bath water works bonds and some moF',
CAGES obtained from policyholders VINO nau
made loans on their pclic .es, disappeared
A Note for 100000.
II was also asserted in the Testimony w.
day that bezides the $4,000 cash tor "h'ch
the insurance societys officials turned oVef
the assets of their COMPANY there was also
a note for slO0,O00 which figured IN tue
transaction. This note was held by Joseph
" Eeanan. president Of the insurance So
clety. Mr.. Beaman declined elther 70 al
firm, cr denv that after the s5O,0oo had been
paid he made a trip 70 New York ana got
an additional payment for his snare III 'i''
transaction on the ground that MS ans"S
might incrimlnate himself Beamah was
so hard pressed by Deputy Attorney ueh-
eral Cunningham to-day that he repeateui!
nleaded his constitutional right not 10 dn'
swer.
L NJ Fell, cashier Of the Athens Nauona'
Bank and former supreme AUDITOR OF Tue
Insurance society: II. A. O'Day' IolH'et
Superintendent OF Schools at Honesdaie ana
supreme auditor Of the insurance soci.y
and L. T Hoyt, postmaster at AthenS' toi
mer member OF the Legislature ana SUI
pren1e attorney for the insurance society
all told of their share in selling out ana
what they got for It.
"somebodv nut $4,000 on my desk In the
directors room in the Farmers National
rank and asked me 10 count II. which
did and then somebody took away 5000
a-l-e divide 1ne
rest of IL into six shares. which | ara.
testified Haverly. the supreme treasurer q
the insurance society. He declared now
ever. that he did not know VINO tne so''.F-
body with the $4,000 cash was. he many
said he thought that the man who put lhe
money on his desk must have been bea-
man, tho president Of the society. or "
Stanton. the supreme secretary. VINO Went
10 Florida Immediately after the investlga-
tion of the keystone Guard was started by
ex-Attornev General Todd al the instance
of Insurance Commissioner McGulioch'
Idea Came from Actor.
I, developed that the original idea OF sell
ing the insurance funds came from
travelling ac:or. Schwentzell. this actor
was nar.ed by the witnesses. who did not
remember his first name, but recalled tha'
he anpeare4 on the stage at Athens under
the name OF Howe"
"Schwentzel had a very rosy PROPOSE
ton for combining all fraternal insurance
societies Of the world into fne body ana
he claimed 70 represent some New YORK
insurance men who would put the PROPOSE
,ion through" testified L. T. Hoyt, VINO
vas the first witness 70 admit that he got
his 5000 fer going along on the proposition
ri turning his insurance society over to the
New Workers.
.rBut Schwentzell did not impress me as
a business man" Hoyt continued. He
brought on J. E. Blackburn then ard az
the thing was presented by Blackburn II
looked plausible and inviting to me at the
time. though ! admit that ii looks differ
ent now. The isea came UP some time be-
fore the convention in Denver last June.
blackburn ana his associates were 70
be given control Of the Keystone Guard by
the destinations Of Ave old directors ard
the election OF Blackburn and four other
New Workers For this they were 70 pay
Us = consideration Of $1,000. We had eight
thousand members al the time, and they
tod me thai such number OF members
was worth $4,000 10 any insurance com.
pany. I believe Il was at my suggestion
that the FIVE New Workers. after their cleo.
ton al Denver, gave their signed res.gna.
,lons 70 Be man. Those designations we're
for three purroses-to give US time TO in.
vestigate the references Of the New York
ers 10 see that they entered surety bonds
and 70 make sure that they paid us the
5000"
Thee Ct the New York men charged
with taking over the assets OF the Key
stone Guard could not be reached here
yesterday. Harrison E. Hoyt. who has 4
law cfn:e az No u Broadway. did not ap
pear al his Office. and was reported out OF
town. Alexander Holland formerly en-
ployed by Galloway, Fish & Co.. brokers,
OF No. 81 Wall street. Is now employed hy
the American Express Company in Los
Angeles His friends are positive that his
connection with the deal, II he had any,
was innocent, or that he was the tool OF
cthers for he didn't make a cent out OF
il. they assert. ]. F. Gray could not be
found.
David Mills Of No. 3oe West !o2i street
when seen ft his home last night, denied
emphatically that he had ever had any
connection whatever with tho Keystone
Guard. He understood, he said, that II
vas bankrupt company whose risks had
been reinsured in an Illinois company. the
name Of which he could not recollect
PROF. G.. w. sCcTT'S WIFE SUES