The Holbrook news., 1921-02-25

First National March 4, and was charged back to the account of Ely on that date and was that day cred ited by the HOlbrOOk State to the Account of the First National of Albuquerque.
 The whole of this transaction is clearly reflected in the records of the Holbrook State.
 Thus $12,5O0 in cash was obtained by the Holbrcok State on a note signed by Ely
 Ely was bank clerk at that time and from all appearances, say the investigators, ''had neither reason nor collateral for the borrowing of $l2,5OO."
 The report also shows that much of the notes still unpaid De cember II, 1920, were used during the existence of the bank as cOlIat- eral to bills payable. That these same notes were not re-discOunted at the First National. In ether words, such notes as the Wakefield and Turbeville notes were used alt ernately as re-discOunts at the First National and as collateral to bills pay ayable, So that they might not re- pose in any one pace longer than they could safely be carried.
 The results of the investigation have more than borne out the claim that the Holbrook State and the First National of Albuquerque have worked in collusion to the end that the Holbrook State could be trimmed down to a sufficient size that it could be swallowed by the First National.
 L. M. Raynolds has always used the prestige of the Albuquerque bank and the name Reynolds to get by on, as witness this spiel to a prospective customer at Pinetop, under dafs ( January 1s, 1919;
 q wish to state that the writ
 CT is the cousin of J. M Ray
 holds, president of the First
 National Bank of Albuquerque,
 who is also a stockholder with
 us Also Joshua s. Reynolds is
 my uncle. merely mention
 these matters so that you may
 know something of my connec-
 tions and backing, so that in
 case you wish to take out time
 deposit with us, you will know
 it Is absolutely safe in our r hands,"
 Signed l.. M. Reynolds.
 Theebank comptroller commenced to camp on their trail as early as April 2, 1919, and warned them to reduce certain loans that were larg- CT than the law permitted.
 In answer to call-down by Jesse Boyce on June 27, Reynolds replied:
 ''We are pleased to see your
 department become more strict
 with us and we thank you for
 callig these matters to our at
 tention."
 Taking into consideration all the many questionable and crooked deals cast up to public view since the closing of this financial trap, one cannot figure out where the defense has even an opening to attempt to justify itself in the eyes of the pub lie or before the laws of the state of Arizona.
 Some of the voluntary statements attributed to L. M. Reynolds, the goat of the system, before and after his confinement in the county jail:
 ''The depositors will receive dol lar for dollar. My uncle has chip ped in $5O,OOo.
 q am going back to Albuquerque and see that the depositors don't get a d-d cent, just for throwing me in jail"
 ''T will be back in Holbrook and open up the bank" You will not get over 30 cents on the dollar"
 ''When I get out of jail Arizona will never hold me again"
 To the credit of Joshua s. Ray holds, now retired, who was an act i've factor in banking circles in the Southwest for more than half a cen tury, it can be said that he was not aware of the pawnbroker tactics that have been employed in Hol- brook.
 J. M. Reynolds, L. M. Reynolds, Cox, ct al, who have for long time known of the precarious condition of the Holbrook unit-have studious-