New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1911-09-28
State Official Admits He Didn't
Know Much About Union Bank.
GAVE IT BILL OF HEALTH
Another Witness Says He Re-
ceived $4,000 for Sale of
PEOPLES Bank Stock.

,r,,n investigators Of the affairs OF the
r-n,ou Bank. Of Brooklyn, made an effort
yesterday 70 find out why the state bank
.vs-,iuers had given that bank a clean bill
- b.aItb in the report OF their examina-
.t,, In 1906. at about the time when the
peorle's Bank was purchased by the Union
and other transactions were being made
.-,,,b have been seriously questioned in
The present investigation.
when the hearings we're resumed yester-
s,-. before Edward L. Dodge. Deputy Bank
r,,,srirteDdent, in the Kings County Court
rr,ss. N. W Hutchins, chief examiner OF
che state Banking Department, was called
witness. Mr.. Hutchins had charge Of
49,. examination Of the Union Bank IN Oc-
tober 1906.
u answer 10 questions by James G. Crop
-,,. the witness explained the methods EN-
loved IN 1906 by the banking department
an conducting the examination Of banks.
10 admitted that under the laws governing
hank examinations at that time the depart
-,spt might have been deceived in certain
rssrects ir recari 70 the actual condition
OF the bank examined. He volunteered the
statement that the laws and methods gov
s-1ing bank examinations nowadays had
been much improved. While Mr.. Hutchins
was not clear as 10 many Of the details Of
the 1906 examination Of the Union Bank
he said be was entirely willing 10 assume
the responsibility for the report
EI-. Cropsey asked the witness II he knew
that the Union Bank bought the People 5
Bank in 1906 for s405 a share when the
r~!ce authorized by the Banking Depart
ment and the stockholders Of the People S
Bank was only $3.50, as the records showed.
or always supposed that the Union bought
Che peoples stock at $3.50 a share" said
Hu-chins. Some one told me in our Office
that was the price. I can't recall who 1t
was. 7 didn't learn Of a higher price until
zoos. when I had talk with Mr.. Michaels
OF the Onion Bank and he told me
about H."
Isn't 10 customary lor the Banking De
rartment 10 look into the sale Of a bank
and see If 70 sold at the price authorized by
the department." asked Mr.. Cropsey.
The bank examiner said he thought that
would be incumbent upon the Albany Office.
Several witnesses were examined yester-
cay who were concerned in the negotiations
preceding the sale Of the Peoples Bank 10
the Union Bank. George w. Spence who
was president of the .'eople's Bank at the
time It was sold, testified that he had moth
ing 10 do with the negotiations.
The deal had been put through by Henry
Il Roth and other directors, who had OBJ
tanned control Of the bank through options
from the stockholders, he said. He didn't
even know the broker. Charles H. Sam
ueIs who had received a commission of
$4,000 for putting the deal through, he
testified
Mr. Samuels was called as d witness. He
sa.5 he was a wine merchant. He told Of
bringing Mr. Roth, Of the Peoples Bank
and Mr. Sullivan and 0Ir. 1lchaels, Of the
Union Bank together. He said Mr. Sulli-
van agreed 20 pay s405 a share for the
Peoples Bank stock. He got his check of
$4,000 as his commission, Of which he kept
q third and gave third each 20 Mr.. Roth
and Mr. AIichaels. as he had agreed 70 do
If the deal went through. He had tried 70
sell banks before. but that was the first
time he had landed a deal he told Mr..
sCropsey.
f The hearing will be continued to-day at
10 a. m.