Evening journal., 1914-01-03
THRIFT FUND
OF N.R.E.C.I
$500 SHORT
Additional Report Of Master
to Chancellor Shows This
Deficiency
DEPOSITORS WILL
GET SMALL RETURN

Deposi- ~ in the thrift department OF
the National Real Estate Company will
be interested in the additional report
OF the master to the Court Of Chancery.
The report shows that money paid by
depositors TO the company for the thrift
department were intercepted and ac'
cording to the testimony of Horace II.
Thayer there was embezzled $1,000 from
the department The report also shows
that interest money was not kept intact
for payment of claims of the thrift de-
partment claimants, but was placed in
the general fund. Fof these and other
reasons the insuiiciency OF the thrift
department fund appears greater.
Henry r. Isaacs special master in
The case, reported his findings to
Chancellor Curtis this morning show
Sng that there was embezzlement
somewhere in the management OF the
thrift fund
In referring the case back to the
master for additional information, the
chancellor ordered the master to re-
port on the three following questions:
"G Whether the sums of money
paid into the thrift department OF the
company, and which we're subse-
ouently at various times withdrawn
Z therefrom by the company by reason
of the failure OF the holders of real
estate instalment certificates to con-
tinue payments therefor, we're all re-
stored to the thrift department in
case the holders of such certificates
i'm default resumed payments thereon
TO the company.
"(2) Whether all of the moneys
received by the company from the
holders Of real estate instalment GER
tificates or credited to such holders
as having been so received, were paiC
into the thrift department, and If not
what was the aggregate amount o
the sums so received, or credited
which did not go into that fund.
"(3) Why the moneys in tho thrift
department at the time the receiver
was appointed were insufficient e
pay i'm full to all the holders Of th'
real estate instalment certificates tin
amounts to which they were severall,
entitled as having been paid by then
to the company, pursuant 10 IN
terms Of the certificate"
AS to the first question the maste
reports that IL seems clear from IN
general testimony that it was n
custom of the company to restor
TO the thrift fund. upon Resumption
of payments by holders of thrift eeT
ticates. all moneys which had bee
previously withdrawn by reason &
default of such holders of thrift cel
ticates. Such was the testimony {
Horace II. Thayer. former treasure
. of the company. and Richard W.
Roberts. manager of the thrift d'
partment, and IL was borne out by q
examination of the books.
The master further reports on tn
] question that both Mr.. Thayer an
Mr.. Roberts testified that the metl
cd adopted by the company IN mai
ing restoration was to set OH pc
iodically the amounts that should
restored to the thrift fund because
assumptions against the amounts I'M
= the company was entitled TO viii
/ draw from the thrift fund because
2 lapses. If the balance was IN fave
, OF the lapses, then that balance Wa
taken out of the thrift fund and pi
{ into the general fund. If the Ca
h ance was in favor of the resumption
! then the amount so appearing W.
J taken out of the general fund and p
\ back into the thrift fund"
As TO the second question the mast
finds that certain sums of money, whi
4 had been credited to holders of thri
certificates and in fact paid in by the
. to the company. never rc'ched the thri
r fund. The master reports that he h
e taken special care in examining bo
MIR. Thaver and Mr. Roberts TO detC
II mine whether money was intercepted
[, its transit to the thrift fund, or wheth
e such money did reach the fund and W
e withdrawn for illcgitimatc purposes. n
e Thaver's testimony, corroborated by
l. Roberts and Peter r. Wright. the J
l. ceiver. was that he signed all chec
Il drawn against this fund and that in
= case was any check drawn except
o. absolutely legitimate purposes. T
u master concludes that the money W
Intercepted in its passage from t
10 hands of holders OF thrift certiiicat
J. TO The thrift fund. but declares that
|. is impossible to say with any degree
dohniteness what was the aggrega
- amount taken.
In his report he states: "Mr. Thay
~ says that Immediately prior to {
II application for the appointment Of
u receiver, he went over the accounts
y the company, balancing the assets
~ the thrift department against its Il
bilities. and found a deficiency
about $500. His testimony furth
shows that Mr.. Molloy confessed
'h having taken about $4,000. and frC
r. the property turned over to the CO
" pany by him, in an effort to ma
lo good the embezzlement. only $40 b
~ been realized for the thrift depa
Ir ment."
IN The master concludes that N
n Thayer's estimate OF the amount TAX
be from the moneys which should hs
been paid into this fund, Is qu
d, conservative, but that it is impossi
dy to speak with greater certainty as
er the total amount which did not res
ie the thrift fund.
ch In answering the third question
master SAYS that Mr.. Ihayer and
20 Roberts attribute the insuiiieiency OF
TO thrift fund to embezzlements.
NO Wright. the receiver, supports them
ds this. but assigns two other reasons; g
ei SOL .lS. which should nave 9eeh palu i
the thrift fund.- in some mysteri
no way reached the hands OF the Delaw
be CONSTRUCTION Company. and that S434
was paid ont of the thrift fund to
eompant : counsel for bringing the act
for the appointment of receiver.
Ixe. the master also finds as cause for
rec suficiencv of the thrift fund that
,rs interest which accrued to the defend
his company was paid into the general f
Ike and no effort was made to keep ;