The Ward County independent., 1921-02-10

Defying the house Of representa-
tives Investigating committee, the In
dustrial commission Monday ordered
F. w. Cathro, director General of the
Bank of North Dakota, to refuse to
produce the records asked for by the
committee. The committee cited Mr..
Cathro to the house of representatives
for contempt. Later Cathro recon-
sidered and produced the records.
Preceding Cathro's appearance on
the witness stand before the investi-
eating committee Monday morning,
the three league members of the COM
mittee withdrew, six members con-
tinuing the hearing. The request
made of Cathro which he refused to
comply with, was to produce the
records Of the bank showing the re-
deposits in the Scandinavian-Ameri-
lean Bank of Fargo.
Townley Breaks With N. d. League
A. C. Townley, national president Of
the Nonpartisan League, who had
been called to Bismarck, appeared be-
fore League caucus and urged them
to accept the offer Of the North Da-
kota bankers several weeks ago, bas-
ed on the liquidation of the Bank of
North Dakota, which would insure
the state of funds to carry out the
grain elevator and flour mill provision
of its program. VIM. Lemke and Gov.
Frazier bitterly opposed Townley's
plan. Townley was submitted to
much criticism by the leaguers, who
declared that he had gone down into
Kansas and Nebraska to promote his
own interests, quitting the state when
the leagues troubles were at their
height. Only dozen leaguers re-
mained loyal to Townley and he re-
turned to Kansas early in the week.
A Nonpartisan league group, head
ed by Senator Baker of Renville coun-
ty went before Col. C. B. Little, prom
inent Bismarck banker. to ask his
advice. Little told the committee that
the first thing that must be done for
the state to regain a sound financial
footing is to liquidate the Bank of
North Dakota.
Townley returned to Bismarck to-
day at noon. It is not known wheth-
er he returned to again urge the
league members to agree to liquida-
ting the bank or to answer charges
made against him by J. w. Brinton,
former lieutenant, who is still on the
stand.
Brinton went into detail concerning
how the league leaders became the
owners of the scandinavian American
Bank and accused Atty. Gen. William
Lemke and F. w. Cathro, director gen
eral of the Bank of North Dakota, of
embezzling and misappropriating pub
lie funds by reason of their policy in
handling funds in the Bank of North
Dakota. He cited certain court cases
regarding misappropriation and en-
bezzlement of public funds to substan-
tiate his charges.
BrintOn Charges EmbeZzlement
Bismarck, N. D., Feb. 81. w.
Brintoh testified at the house investi-
CATION of the Bank Of North Dakota
and other state industries just before
the close of the days session, that at
the suggestion of William Lemke, now
attorney general, and o. E. Lofthus,
state bank examiner, he gave check
for about $11 900 to the Mercantile
State bank of Minneapolis, when he
did not have that much money on de-
posit in that bank.
Brinton testified that Lemke and
Lofthus knew he did not have that
amount Of money in the Minneapolis
bank, but wished to have the check
appear in the cash items Of the Scan
vian-American bank of Fargo,
that showing might be made to the
supreme court of the state that the
bank was in good shape, 50 that it
could be reopened following the "raid
of Bill LANCER" on the institution. He
further testified that Thatcher, GER
titled pubic accountant, was present
at the time the arrangement was made
and undoubtedly knew of it.
Brinton in his testimony charged
that there had been misappropriation
and embeEzlement of the funds Of the
Bank sf North Dakota in the fact that
the funds Of the institution were
transferred from the Bank Of North
Dakota to the Observation-Disclosures
bank in Fargo, and that the funds
were used for political purposes.
He testified that he had been brot
into touch with the situation by being
called to Fargo by A. G. Townley.
president Of the league, Lemke or some