New-York tribune., 1914-11-17
Secretary of Corporations
Recital Is Trial Climax
of the Day.
FEARED BANKRUPTCY,
SAYS WITNESS
History of Stores Holding
Co. Told-EX-Banker'S
COnhdant TeStiheS.

IFrrrn 8 Star Correspondent n The Treune.l
Geneseo. y. Y. Nov. l6.--Coming as
g dramatic climax 70 his story Of the
way the Siegel stores Corporation was
used to drain money from Siogel en-
rloves and other small buyers - rs
stock into the tottering stores IN a
desperate effort 90 keep them out OF
bankruptcy. Robert b. McMeekin. sec
retary Of the corporation, testified to
6ay how Siegel asked him just after
he grand crash came 70 md out Wh'Ie
he could bo safe from eNtradluon.
The conversation occurred at tnV
Hotel Majestic McNeekin saiG. ne
asked me 20 go 10 the public Hnrar'es
and see with what countries there WeIS
no sxtradition treaties on the part OF
the United States.
But I said to him: 'Mr. Siegel. you
had better 80 and take that matter up
with your attorneys. Rose & Paskus'
He never spoke 20 me agaln about II.
This brief. recital Of that incident
seemed 10 fall with a peculiar slgnih-
csnce IN the tensely listening cour'-
room. Il came. amid the masses OF hg-
ures and muddled accounts that nave
made I'D the bulk OF evidence. as
plain. clear cut fact that needed no eA-
pert accounts interpretation
silence in Courtroom.
For moment after NcNeckr fin
shed hush hung over the courtroom.
Then. as If apprcciatlng that II was
GOOD place 10 stop. although itteen
minutes earlier than the usual time es-
.ahGshed in this trial. Judge CLARK let
his gavel fall and said: u-
The court VIII suspend at TINS
The Jurors fled out Of the box with
his damaging fact left clear cut IN
their minds, unclouded by turther
DlungeS into figures.
In giving the history Of his part IN
he Siegel enterprises McMeeSln toid
the story Of how Siegel ana NogeI III
1909 finding they had one good store
oDe doubtful one and one failure, con-
ceiyed the idea Of amalgamating them
INTO one concern. 20 be holding com
many known As the Siegei Stores Cor
poration. The combined capital OF the
three stores, he said. was e4oOOOVp'
hut thev capitalized the holding COM
pany at Sl0,275.000.
II took over all the stock Of the
Fourteenth Street Store. simpson
Crawfor6 & Co. and 93 per cent of the
Siegel-Cooper Company IN Chicago ne
>aid. Two millions was preferred
stock. Of which more than Sl,e50,OOO
was sold for cash.
"Of this" he said. 100000 or S40o'-
600 worth was bought by Siegel en-
3ioyes and the rest by other pur-
chasers al over the world.
The common stock Siegel and Nogel
and their families. who were Interested
iu the enterprises. took in exchange
For their holdings In the common stock
cf the three stores. The first million
realized from the sale OF the preferred
stock 10 the public. he sand. was lent
- tho three underlying stores 70 keep
them a1oat
Loans Without Security.
That IS. The money was given o.
loaued." he said "At first il was in
,onded 70 sell only 100000 worth Of
stock. but 100000 went. Soon after
ward 7 was asked 20 lend the money
without security to the underlying
companies as working capital. There
was a conversation, at which ~ was
Trst suggested that the money be given.
Put said that couldn't be done, 50 the
money was lent on demand notes.
an some cases the money was paid
over and in others placed TO the credit
of fne open accounts OF lllt ll4utA ~ itiS
companie7. The Indebtedness OF the
various Siegel-Nogel COMPANIES on de-
mand notes TO the Siegel Stores Cor
roration on February /, 1918. was:
Simpson Crawford Company, S680O0;
Fourteenth Street Store. S330509.
Henry Siegel Company of Boston S62,-
600. and SieCel-Cooper Company, o.
Chicago, sC934, CT more than S4c50OO'
These are some Of the inter-company
'ndebtedresees il is alleged were not
shown IN the financial statement, on
which it is charged in the indictment
Tor which Sieeel is being tried that he
etole S68l O5 from the National Bank
of Commerce.
McMeokin was preceded on the Wit
ness stand by Frank l.. Champion. who
IAN Siegel's bank for him in the Four
teenth street Store. During Cham
pion's testimony John b. Stanchield,
Siegel's counsel. found fault with the
way Arthur G.. Train, the prosecutor,
was conducting the examination.
Nj Train found Champion a not al