The Oskaloosa herald. (Oskaloosa, Mahaska County, Iowa) 1885-1919, 1914-02-12
-EEFAULT|NG BANK
=: HEAD IS JAILED
President Of Wrecked Memphis
Bank Admits Guilt.
WILLING TO TAKE PENALTY
Cotton Speculation 10 Cause Of oefal.
estion--peelared Shortage viii
Reach $1,000, 900 - Liabilities
Placed at Over Two Million.

ulluoT SupSINlslOu Vi d. L. k1uttOu,
state superintendent Of banks and re-
ceiver for the Mercantile bank, Off
GERS of the institution, which closed its
doors yesterday morning, are examin-
ing the books in an effort to determine
the exact amount of shortage, for
which c. Hunter Raine, president Of
the bank, asserts he alone is respon-
sible.
A report in circulation late Monday
was that a director of the Mercantile
bank, one of the heavy losers in the
failure, had announced that he was
willing to stand his share Of the loss
necessary to pay savings department
depositors. 1t is understood that If
other directors agree it will cost this
director $4,000, His loss in the fail.
ure is said to amount to $4,000.
Up until late hour, Receiver Hut
ton had reached no definite accounting.
General indications are, it is said,
that the audit will show a deficit in the
Aeighborhood Of 100000.
Rsine Is Arrested.
Mr.. Raine has made no effort TO give
bail, according to attaches of the Grim
inal court. He was arrested shortly
before noon on a bench warrant charg.
ing embezzlement of $7SS, S04.76 Of the
banks funds, and was taken to the
county Jail.
The bank president was escorted be.
fore Judge Palmer by Sherlff Tate and
Deputy Sheriff M. w. Palmer. Taking
the warrant under which the banker
was arrested and which was sworn out
by Attorney General Estes, the court
read the document to Mr.. Raine and
asked him If he had anything to say.
Il am guilty." replied the banker.
Mr.. Attorney General" continued
the court, what bond do you recon-
mend" 49,.
Before the attorney general could
reply the banker interrupted with: q
don't want to give bond; l want to &c
to jail"
He was taken to the Jail by Deputy
/ Sheriff Palmer. When he was searched
at the Jail, preparatory to being com
mitted to cell, he informed the jailel
that you needn't be afraid I'm moi
going to make any trouble"
Bond Fixed at s25o,ooo.
Judge Palmer fixed the bankers
bond at $250,O00. 1t is understood
| however, that Mr.. Raine will make nc
effort to furnish bail. His attitude ie
taken by the county authorities as in
dicating his willingness to take with
out resistance any punishment that
might be meted out by the criminal
court.
Criminal proceedings against the
banker came as the elimination oil
the banks failure. An application for
the appointment Of J. l.. Hutton, state
superintendent Of banks. as receiver
for the Mercantile bark, vas granted
by Chancellor Fentress. MIR. Hutton
arrived in Nashville early in tho day
and Immediately upon the chancery
courts decree naming him receiver
took charge Of the banks affairs.
The bank was fficially closed fol
lowing an order by the board Of direc
tors, who subsequently fled a bill in
chancery, charging c. Hunter Raine
president of the institution, with hav
ing lost, through cotton speculations
$1SS, S04.76 of the banks funds.
! Owing to the banks extensive oper
atoms, a complete report of the re
ceiver's audit is not expected for sew
eral days. A detailed statement of the
institutions financial condition could
not be started until the timelock on
the banks vault opened its doors Mon
day morning at $50 o'clock.
Charges Against President.
According to a statement by direc
tors of the institution, the alleged
shortage in the banks funds was moi
discovered until Sunday. The bill filed
In the chancery court by the board oil
directors sets forth that the banks
insolvency was directly caused by the
banks president. 1t sets forth fur
Their that the banks liabilities approx
mate $2.196,S93.67, with assets of 81,
4OS,9SS.91. The bill accuses the presi
dent of having steadily and artfully
concealed" from the board of directors
and other officers the true condition
OF the bank, averring that Mr.. Raine
had lost money by system OF hand
ling its drafts, property and exchanges
In such way as to deceive the direc
tors and conceal his manipulations."
By applying to the chancery court
for a receiver, and the granting of the
application. litigation by creditors was
prevented.
State Bank Superintendent Hutton
under the banking laws of the state
automatically assumes charge of a
banking institution at the moment tina,
its insolvency becomes known. Fol
this reason, it Is understood, he was
asked to name a receiver so the affairs
of the bank would be entirely In his
hands. The Mercantile bank was cap
italized at 100000. Its annual state
ment, issued January 6, showed a sur
plus of 100000. The total deposits
were given at 1885,, 900.
It is freely rumored Mr.. Raine's will
ingness to go to Jail instead of bono
is the result Of statements made by
many small depositors who have ex
pressed their animosity against him.