Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1913-07-03
2 HELD FOR
!. FRAUDS IN
CONDUCT
Of BANK
S, {. Smith and H. S. Miles Give
$4,000 Bond Each-0ne
Count Felony Charge.

S. E. Smith, president of the
Guarantee Trust and Banking
Company, and H. S. Miles, secre-
try and treasurer, were indicted
by the Grand Jury Wednesday
on charges of declaring false div
idends, buying bck their own
stock and doing business without
a proper license.
Five indictments were drawn
against each of the men. Only
one is punishable as a felony.
that of declaring false dividends.
Warrants for the arrest Of the two
men were served upon them by Dep
uty Sheriff Picnic Miner and they
were taken into custody at 1:35
o'clock at the banking house in Ala
bama Street. Their bond has BEEN
fixed at $4,000 each.
Refuse to Talk Of Case,
Neither man would make any cow
ment on the action Of the Grand jury
when seen by a reporter. They sais
they had received no official notice
OF the action and had not as vet been
served with the papers in the case
The action Of the Grand Jury is in
the nature Of sequel to Judge John
T. Pendleton's appointment last week
Of John Robinson as receiver for
the company An appeal was taken
to the Supreme Court by the COM
pany.
Attorney Frank A. Hooper has been
designated as prosecutor in the case.
owing to the disability OF Solicitor
! General Dorsey. The Solicitor was dis
qualified from the fact that his law
firm IS acting as counsel for the pe-
titioners in the case
Long and Bitter Fiaht.
The return of the indictments a.
another chapter in one Of the long
est and most spirited fights in the
recent history Of the Fulton County
Superior Court. The case was insti-
tuted by Matthew Delaney and others
and the trial was entered for Nav
with the plaintiffs charging that the
defendant company was insolvent az
the result Of fraud and mismanase-
ment and the company contendInr
hiatt it was amply solvent and abls
to meet all outstanding obligations.
The first important step of the
plaintiffs, after the filing of their Pc
tition in court, was to serve the de-
PENDANT with notice to produce IN
court all its books. records and ac-
counts and to cause the testimony OF
the president, secretary and chief
bookkeeper to be taken under oath
before a commissioner. The stenog-
rapher's transcript covered more than
500 typewriter pages.
Receiver Is Named.
On motion of the plaintiffs coun-
sci, the court appointed C. J. Metz
as auditor Of the books and records.
Following the report of Mr.. Metz, the
plaintiffs contended that every allie
cation made by them had been sus-
tanned and that the business of the
former Guarantee Redemption Com
pany had, at a time when the COM
pany was insolvent, been sold to the
Guarantee Trust and Banking Com
pany for a bonus Of s25o,0O0, the
greater part Of which sum was paid
to Smith and Miles.
The decision of Judge Pendleton
| declared that under the evidence, the
| officers Of the company had been gull
ty of violating the trust relations i'm
posed by its contracts and by the laws
of Georgia and was unable to meet
the measure Of solvency fixed by the
statutes of the State. The decision
was formally concluded by the films
Of an order granting all of the pEas-
ers of the plaintiffs and designating
| James D. Robinson receiver.