Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1915-03-13


~ connected with the First state bank
OF Las cruces and the affairs thereof,
socially, politically and in business
way We find that the controlling
spirit of the democratic party during
the campaign of 1911 and subsequent
thereto had been the First state bank
OF Las cruces. ana the purpose Of
this political activity was to place
SAID bank in position To control the
deposit OF the college funds. That
such political activity did place them
in position to control the college
funds and as reward for their po-
ltlcal activity the college funds We're
Kept in said bank
appointment oi Metlaufer.
That said First state bank OF Las
Cruces was absolutely dominated and
controlled by its president. r. II. IT..
smith. We find that subsequent TO
the resignation of II. j. GuilfoH as
registrar Of said college one O. Wet
laufer was appointed rs registrar Of
said institution. j. IA. Paxton and
NJ. O. Llcwellyn, i'm their testimony,
each claimed the honor and assumed
the responsibility Of that appointment,
but the evidence shows that the APP
pointment was made a the suggestion
of T. Il - smith, president of the
First State bank of Las Cruces, and
the SUBSEQUENT conduct Of said Wet
lauier shows cOnclusively that the
purpose in having him appointed to
that important position was to use the
position fer the First state oank of
Las Cruces. That Said Wetlaufer ex-
erted every means within his power to
assist said bank in obtaining deposits;
that he held up the acquisitions filed
with him for supplies for the school;
that ne held up the bills for the pay
ment Of supplies; all for the purpose
of holding the college funds i'm said
bank. That this conduct on his part
existed during his entire term of Of
flee up to the closing Of said bank
In addition to his endeaVor to assist
said bank he incidentally embezzled
over $1,000 of money belonging to said
college
Bank of TuCumcari.
We find that in May. 1918. the tray
cling auditor of New Mexico had the
First state bank of Tucumcari ex-
amined. That according TO the books
of said bank there was q balance due
said bank deposited with the First
over $1,000 That said travelling aud
itOr endeaNored to ascertain the cor
fectness of said statement and the
president of the First state bank of
Las Cruces falsely ana fraudmently
represented 10 said travelling auditor
that said balance was correct when in
Truth and in fact, as was afterwards
asccrtained, instead of having a bal
ance Of over 1000 with the Las Cru
ces bank. the account OF the First
state bank Of Tucumcari with the
First state bank of Las Cruces was
overdrawn. That the fact of this de-
ception was called to the attention of
the travelling auditor of New Mexico,
through his deputy, l.. Il. Wootefs,
i'm October, 1919,
Investigates Same.
That thereup0n the travelling auditor
made an Investigation to ascertain
the character ana financial standing
of r. r. H. Smith, president of the
Las Cruces bank. That he ascer-
tanned from said Investigation that
r. r.. II. Smith was unreliable in
every way and had no financial re
sources whatever. That having said
knowledge as to the character and
financial standing Of Il. Il. II. Smith
and the fact that said 7. II. II. Smith
has Intentionally deceived his office,
the travelling auditor had the First
State bank of Las Cruces examined
in October 1918, and aseertained
that the capital stock of said bank
was impaired more than SO per cent.
That subsequent thereto, tO-wit, in
January, 1914, the travelling auditor
deputized one j. w. McCarty to In
vestigate The affairs of the First state
bank Of Las~Eruces.
Bank Was InsOlvcnt.
That said j. w. McCarty did in
vcstigate the affairs of said bank and
ascertalned that said bank at that
time was insolvent That fun infor-
nation of said facts was given at
that time to the travelling auditor
and to the governor of New Mexico.
That from the reports made by the
travelling auditors office, In October
1913, and in January 1914, it was
ascertained and reported by the tray
cling auditor that the capital stock
of the Las Cruces bank was impaired
TO the extent of $50 per cent That
thereupon, to-Wit, on January 20,
1914, the travelling auditor accom-
panied by the governor of New Mex
leo. went to Las Cruces and had
meeting with the officials of sad
bank relative to the financial condi-
ton of said bank That what was
done at said meeting is vague and in
definite but your committee mas
that although the governor of New
Mexico and the travelling auditor at
the time they so met with the oltle-
ials of said bank, knew that T. X H.
Smith, the president of said BANK,
was undesirable in every way in con
nection with banking matters and had
no financial resources had dellbef-
ately deceived the travelling auditor
office and that the bank at that Tune
was insolyent, the capital stock be
ing impaired at least to the extent OF
1850 per cent. yet not thlng was
done from that time on by either the
governor or the travelling auditor to
require the affairs of said band TO
be placed in a better condition
DereIictiOn Charged.
That although during all that time
the governor and the traVelinS aud-
itor knew that the funds of the state
college were deposited IN SAID bahk
no steps were taken by either the
governor or the travelling auditor TO
protect said funds in any way That
neither the governor nor the tfaNel-
inc auditor notified either directly or
indirectly any member of the boara
of regents of said school that sald
bank was in precarlous CONDITION,
so that the funds of said school coulu
be protected. That the travelling auo-
itor has attempted to justify ms ac-
ton on the theory that mad ne hol-
fled the board of regents Of such cor
dition it would have caused q run
on said bank and me in l,.ll''' -,