Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1911-01-14
THE YORK BANK.
State Bank Commissioner
Tells Of Methods
Employed BY Treasurer niger
soil in His DetaICaiionS.
Statistics and Recommendatio
Contained in Annual Report.


crepancy in the individual deposit ac-
count WAS due to false book keeping
To max" it appear that the bank was
earning more money than was actual
" the case. The bank had met with
heavy losses i'll investments. A
record II such losses which had been
charged off between the late seventies
ard 1903 showed II total of some $l97, :
G00. lin order to show income enough
To- meet such losses and any other re-
sources which had disappeared by
loss. embezzlement or otherwise and to
provide sufficient funds from which to
declare dividends. tho treasurer made
false pnstines Of cash book entries To
the general l"dger So as to increase
the apparent income account and to
conceal this increase by Il correspond
ing decrease Of tn total deposit ac-
count
For example during the week md
ing NaN -. 1891. the cash book show
ed items OF income amounting to
$l33.1a. These were correctly entered
and footed in the cash book But
when II" posted the weeks total
To tho income account on thu gen
eral ledger, he entered II as
81, l33s5. This was Il false Increase
Of one item Of liabilities of one thou
sand dollars The cash book still
balanced. because no figures on il had
b, ea altered But to make the weekly
sfatment balance some other item of
liabilities must be decreased. The
cash book Showed for the same period
Withdrawals of deposits amounting 10
>2.i29I3. These were correptely en-
tired and footed in the cash book. He
posted this footing as $3,49943 thus
decreasing the total deposits one tnou-
! sand dollars and his books still bal
anced. and this fraud, like that in con-
nection with the checks on other
banks would be detected onlv bv acct
dent or by causing trial balance of
all individual deposit accounts To be
made by some ore other than the
treasurer which the law ao,s not re-
quire and which has never been done
il. practice until that made under the
cali Of the department above referred
IL. FiftY-tW0 Fl these. items occur in
the books, beginning with tn. above
date and ending Oct. IL, 1904 Since.
th5lt date three similar items occur and
two where he transferred direct from
one general ledger account To tht. other
without passing through the cash
book at all.
1T may be suggested that this ar
bitrary reduction of the total deposit
account should have attracted the at
tentien of the trustees. Eut ii was
extended over Il long period at trregu-
lar intervals and in such way that the
balance appeared To run along in q
normal manner without noticeable
iiuctuation3 either way.
Another manner in which the diff
ference between the true deposit ac
count and the account as shown by
the treasurers general ledger rapidly
Increased without disclosing any
tangible evidence Of Irregularities was
IN the adding Of dividends. 1t was the
GutN 81 the assistant treasurer Ia figure
the dividends on each deposit and add
thelh 10 the Individual accounts. cred
ltlng them on the pass books as pre-
seHted' The treasures figured the
aggregate amount according To the
trlal balance Of individual deposits as
made by him under the statute. 1t
VIII be seen that b. as much as this
trial balance fell short Of The true
totai oS that proportion did the aggre-
gate r.Viuend which he figured and
added t. the general ledger account
fall short ot the true total of the in
diVidu7l dividends correctly figured and
credited by the assistant. And this
discrerancy would constantly be in
creased by compromising the interest
on II every six months. So with this
discrepancy admittedly beginning
many years ago. and practically all
the fraudulent entries and embezzlc-
ments more than six years ago. that
Npart of the present shortage which
arose from this source would be very
large.
The annual report Of State Bank
Commissioner William Il. Shelton OF
Lewiston deals at length with the de-
iaication recently discovered at the
York County Savings bank. Tho
commissioner after discussing the
manner in which the discrepancy was
lCund explains some of the methods
employed to conceal it.
Mir. lngersoll employed different