New-York tribune., 1911-04-23
CHENEY blAMES
ANDREW CARNEGIE
Saws His Assurances Postponed
Closing Of Trust Company
for Many Weeks.
nIyCALLSF0RTH STATEMENT
Ranking superintendent Declares
tronmaster Told Him He
Would Not Let tnstitu-
tior Fail.


..s carnegie Trust Company long before
,.-,srv :. 1917 That is the question
,..,.srror Dix has asked. and Superin-
..ras,, Cheney has answered orally and
III answer In a formal written state
-,ert N the Governor on Wednesday.
w Chenev's report viii be q defence
- the departments course in permitting
,.s carnegie Trust Company 10 continue
g. business between April. 1910, and jan
...-v 1911. and the backbone Of his de
,ence will re the assertion that Andrew
r.-rsg,e repeatedly assured the depart
rsr+ during that period that the trust
,o,,rsnv would not be allowed 10 fail.
Mr cheney. aided by legal advisers.
-,ss hard at work on his statement
,..s,.rdsv. Back Of Mr. Csrnegie's YER
haI assurances. he will say, was the de
-s---ert's knowledge that the iron
master had lent the trust company mill
rms on two previous occasions. and II
rss not - be supposed that the depart
wan, would sacrifice the four thousand
small depositors when salvation loomed
nightly Just ahead.
NJ Carnegie lent the trust company
s9nonOno 70 save II from closing its
ioors following the panic Of 1907. That
--onsy uas paid back 70 him. And again
= ranua-v. 1910, he advanced the di-
-,c,ors ~ the company 100000 in
tonds ~ -he United States Steel Cor
,orstio, which we're sold for -, 10000
.-s proceeds beinz used TO retire three
mites FOR S6nOOOO each and part OF
.,ur-h for a like amount which Charles
e. Dickinson had used IN acquiring con
,-ol of the Van Norden Trust Company
and The Twelfth and Nineteenth Ward
hanks As a matter Of fact, the Bank
9spartment had threatened 10 close the
,-ps, conorsnv II these notes were not
retired. though they had been guarah-
,sed h. nine Of the compsny's directors.
Odd Result Of Second Loan
This second loan has not been paid
hack. Its payment is guaranteed. how
ever. by all of those directors who in
sorsed the "a per n superseded, and, fur
fhsr1ore. collateral consisting Of shares
n stock IN the banks bought by Dickln-
sor and eight thousand shares of Plat
Iron Works stock among other securi-
ties. aas put up 70 secure it. Mr.. Car
rseie II was learned. bought back his
s.a.r bonds for 81 $40, 600 potential
--oHt IF $500 900. and sold his bank
stock collateral - advantage. In case
ms ,irle 70 the Platt Iron Works stock.
nov disputed by George L. Dyer. IS es-
,sbNshed and the committee Of creditors
puts that company on a SOUND footing.
ne ironn7aster stands 70 win rather than
lose - result Of the transsc sction.
But that : somewhat beside the mark
NJ Cheney will point out that the bank
'uE department. knowing all this. ap-
proached Nr Carnegie in April. 1910.
following an examination Of the trust
company and asked him what he ex
rsctsd 70 do I'm view OF the impairment
NJ the trust company capital and re
serve Mr Carnegie at this time as
-ursd the of1csls Of the department il
IS said that the company which bore
his name 7ould not be allowed 10 go
under
The Superintendent n Banks. there
fore though he Watched the trust com
rsnv closely. kept hands off until the
osrs arrived for the second semi annual
examination This took part the latter
rsrt ot last August and continued into
September
That examination disclosed sn even
"crse STATE Of affairs than had obtained
IN April Following II N. ". Hutchins.
CHEF examiner If the Bank Department.
reported
y fnd che Csrnegie Trust CompanN
csrnot ~ourlnue in business without seri-
cusiy erdanse~inc the city and state de-
rosits therein I find that loans are i'm
proper made. contrary 70 the direction
n the Banking Department ] ind the
Carnegie Trust COMPANY reserve i'm
PAVED