Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1913-03-21
HOLDS OFF
ASJUDGE SCANS
CHEROKEE
Brooks Suit. Declaring Rome
Insurance Co. InSOIvent, To
Be Heard To-day.


b B. Brooks, a share holder, brought
against the Cherokee Life Insurance
Company Of Rome. preferring to await
action of superior court to-day.
Assistant Insurance Commissioner
Copeland declared today that records
i'm the insurance department indicate
the companys solvency, and until new
features Of the case develop the au-
thorities will proceed on the company's
statement of December 81, 1912, indi-
cative of its sOundness.
b B. Brooks. holder of $500 income
bearing certificates in the Cherokee
Life Insurance Company Of Rome, in
his petition filed with Superior Judge
George L. Bell yesterday, charged mis-
appropriation of funds, mismanage-
ment of the company and asked that
a receiver be named. Judge Bell will
consider the case to-day.
The petitioner alleged that the funds
Of the company have been dissipated to
an extent that endangers the invest
ment Of the stockholders. and that the
company is being operated now at
loss Of from $1,000 to $1,000 per week,
1t is asserted also that $1.6S1 500. said
to have been the fund taken in by the
company since the organization, has
dwindled to $35O,0OO.
Brooks through his attorneys Cope
land. Hamilton and Hutchens, of Rome,
and Ault q Wright, of Cedartown, as
serted that he had demanded payment
for payment for his interest bearing
certificate despite the fact that the
certificates were payable on demand.
The petition related that the COM
pany Is engaged in both industrial and
ordinary life insurance and alleged the
officers have been endeavoring to sell
the assets and policies OF the company
an action. which if permitted, will
mean a loss to stockholders and credi-
tors alike.
The petition charged wholesale fraud
and mismanagement on the part of
the officers of the company from the
time Of the organization to the present
day. 1t asserted that the promoters,
who afterwards became officers. at
tempted 10 formulate a plan whereby
the company would begin operations
without any cost or risk to themselves.
and that they therefore settled upon
plan to organize a mutual insurance
company without capital stock. This,
said Brooks, they did without any re-
gard for the policyholders or the cred
itors of the organization.
Petitioner alleged that from the or
ganlzation to December 80. 1912. the
total income amounted to $8O7.16407.
which was realized from the premiums
S47S3461; interest, S6,064.46: sale OF
certificates s653,225
The total expenses and losses during
the period amounted TO s437,944.96. Of
which amount, the suit maintained
only $24,156.1S was paid out for death
claims. while the salaries amounted 10
$97.139Ss. or almost twice the sum
derived from the legitimate business
income.
For the period between January I,
1912, and November 80. 1912. the suit
asserted, the total income was $754,-
1888. which was aPportioned as f.
lows: Total premiums, $211.319.1S: To-.
tai interests and rents, $l7.5O6.3S; in
come from sundry sources. $127.47I:
income from sale of certificates, $524,-
So
The losses and expenses incident TO
operation said the petition. during that
period of eleven months were $61s-
07L9O. or which only $92 663.S2 was
paid for death. accident and sick claims
and for cash surrender values. The
yF g.
securing business amounted to S12s,-
40I57, and in addition. said the su.y,
the superintendents officers and em-
ployees received $S559152 making a
total paid out to agents and employees
Of $2ll, 9901O.
BY subtracting from the expenses
enumerated above the sum of $685.
S25.56. which. according to petition.
represents the legitimate business in
come, the petitioner attempts to show
the management OF the company
wasted in the eleven month period
s3S9,252.33
Tile company. averred the petition. |
has outstanding $11Sl 500 indebtedness !
represented by certificates which qua %
antee interest at six per cent. viii = |
would mean for interest alone S10o.-
COS per year and the income per week |
from premiums is between $4,000 All |
$5.06o
The assets are jtemized as follows.
100000 in bonds deposited with :ha !
comptroller general bout 500 00O ca sn !
in bank. about $4,000 in real estat, !
mortgages and equity in real estate |
about $4,000, making a total Of about |
$35O000
Representatives Of the Cherokee Life (
Insurance Company. in a statement !
assured the public that the company is !
the victim Of sensational litigation |
against q thoroughly solvent institu- |
ton with net surplus of over $500 |
coo and assets Of $4,000. 600 of in |
surance. representing hundreds Of |
thousands of dollars invested.