The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-11-21
Ex-Sen. Smith Drtvenh Into
Trustees Hands by Debt;
Said TO Ozve $1,Z5O,OOO
Jersey Politician Resigns as
Head of Federal Trust
Company.
GOVERNMENT INQUIRY
PRECEDED THE STEP

NEWARK. n. j.. Nov. 2O.-For,ner
United States Senator James smith, Jr.,
Of New Jersey. who was the undisputed
Democratic leader OF his State for many
years, to-day placed his general busi-
ness interests in the care Of the Fidelity
Trust Company OF Newark for the bene.
flt OF his creditors. Later in the day he
resigned the presidency Of the Federal
Trust Company VI Newark. a position
he had held since his entrance into the
banking business In 1904.
Christian W. Feigenspan. president
Of the Feigenspan Corporation. brewers.
was elected president tonight to sue
coed him.
1t Is estimated that his outstanding
obligations on his various business enter
prises. represented in large part by
notes held by banks in Newark, New
York and other cities, amount to sl.150,-
zoe. The reasons given for his financial
embarrassment are losses sustained by
him in the operation OF his newspapers
the Newark Eagle. formerly the Morning
star. and the Newark Evening Star. and
losses In his patent lea thcr manufacture
ing business
IL was announced on behalf of the
Federal Trust Company that Mr.. Smith 5
| Indebtedness Is connected In no way with
the trust company. Hamilton F. Kean Of
Eean. Taylor n Co., bankers OF Nassau
street New York. who is IA director OF
the Federal Trus, Company. said The
Federal Trust Company has 2,0o0. 600
| in cash on hand and $1,000 900 in bonds.
This is shown by an examination which
Is now In progress. The Federal IL in
just as good a condition as any other
| banking institution in Newark"
Says Federal Trust Il sound.
George NJ La Monte. state Commits
/ sSoner OF Banking and Insurance of New
Jersey. said before ex-senator Smiths
resignation president OF the Federal
Trust Company was accepted: The
I trust company Is in very strong fnan-
( cial condition. according TO all the In
! formation In my possession. This shows
that the bank has Sl,o00,00O capital.
! 100000 surplus and large undivided
! capital. thus affording ample protection
! to all the deposltors."
! Although IL has been rumored from
| time 10 time In the past few years that
ex-senator Smith was carrying great
! financial load that gave himself and his
friends a good deal Of worry the tact
that he had placed his holdings in the
| hands of the Fidelity Trust Company.
! one of the strongest Of New Jersey In
! stitutions caused much surprise In imam
| cial and political circles This action 10y
| Mr. Smith was precipitated as the result
IL is said. OF Investigations made by feu'
eral banking examiners in New YORK as
to the amount OF Mr.. Smiths paper he'
ing held by national banks in THIS city.
1t is known that John Skelton VIII
Jams. Comptroller of the Currency oi th'
United states, was so much interested
in these investigations that he had .
conference in New York on Friday viii
Charles Starek, chief bank examiner foi
the New York district. and was thor
oughly satisfied that there would be "
embarrassment on the part OF any panK
as all were amply protected
hank Examiner at Work.
Bank Examiner Starek spent IN
greater part of yesterday IN He"a'h.
,s understood that his presence ther'
was along the line OF his same ou'! II
New York: to find out exactly how muci
OF Mr. Smiths paper was held ny th
! national banks in that city. HIS Jurls
dIc,ion did not extend to other than ma
. tional banks. - -,
Although Mr.. smiths power IN IN
State has been On the decline since 81"
advent of Woodrow Wilson in the poiit'c
os Naw Jersey he still continued Z
, exert great influence III ms nome "ou,
of Essex Until now 1t was seherah
accented as "A fact that he would eNer
r,uch influence in person and through M
n.wsnapers in the campaign TOT IN
Presidency that will he threshed ou
next fall. His friends fear that AZ IN
result of his financial difficulties he WI
I not take such an interest IN thNss pp1'''
, cal i'm the future as he mas IN the pas
AIR smith is now in his sixty-nfth yea
and is still vigorous physically and men
tally.
I Smith Leaves Federal Trust.
The directors OF the Federal Trus
a comnany met yesterday afternoon in tn
directors room OF the Fidelity Trus
4 Company In the Prudential Buildin'
. Newark Mr. Smith was present an
4 rendered his resignation.
4 T-zal II. McClrter. president OF IN
! Fidelity Trust Company. and Charles !
L'arrell president of the Essex Count
:, National Bank. two of the largest inst
i, tutlons in Newark, were invited by II
| directors of the Federal Trust Compai
> to 20 over the books of the FEEDER,
Trust Company with James Thorne AN
Horace Biddle assistants to state Con
> missioner of Banking and Insurance l.
u Monte. for the purpose OF determlnii
= tho exact condition OF the Federal Trus
: +, was explained that the directors fe
e this action was desirable at this time
Il order to satisfy the public that the Fec
II eral Trust was involved In no way b
!. reason of Mr.. smiths financial troubles
= Several experts from the Fidclit
d Trust Company went TO the Federi
y I,rus, ,'ompanys banking house
N Facilitate the examination. with the III
y Outstanding that If the examination w
n rontieted by 9 o'clock full repo
. would be made to the Federal Trust d
rcctors. r,,.,,
The directors remained at the Fideli'
l., Trust Company's offics until nearly
.. O'clock. when it was announced that
II adjournment had been taken until \ !.
a o'clock. with them was John X. liardi
4, ,.rsonal counsel for Mr. Smith. VINE
N MIR Hardin left he said that he was n
In nrep,red to say anything as yet co
a. =. ming ex- x-Senator Smiths anatrs.
in Mr.. Smith also refrained from makii
r. any statement .., A..
10 The directors did not complete tn
II. night session until l2 o'clock. II W
lc then announced that Mr.. Feigensp
Al mad been elected president of the F'e
'" -