The Democratic advocate. [volume] (Westminster, Md.) 1865-1972, 1922-06-09
OLMSTEAD ARRESTED
RELEASED ON $4,000 BAIL SHORTAGE
OVER 100000 VIGTIMED FRIENDS

10 the SnpShOd business metnOdS
and credulity OF some of It's patrons
is attributed to a certain degree the
difficulties Of the First National Bank
of Union Bridge, which was closed on
May u by order of Government accoun-
tants after a serious shortage had been
discovered in the accounts of the
trusted cashier, Edward F. Olmstead
The cashier was arrested Friday
morning by Deputy United States Mar
Shals Davies and O'Connell and taken
to Baltimore. After pleading guilty be-
fore United States Commissioner Sup
plee he was released on $4,000 bail,
pending the action of the Federal
Grand Jury.
Although Olmsteads speculations
probably cover period of several
years the shortage was not discover
ed until the Governments account
ants, Thomas j. Kane, Hubert Graham
and Joseph r. Schneider appeared at
the bank in Union Bridge on May 25,
few days in advance OF the time for
their semi-annual examination of the
books of the institution. The Suspic-
ions of the accountants were aroused
when Olmstead declined to answer
question put him relative to some
bonds, and the searching examination
which revealed the shortage was in
stituted.
Before the Commissioner the cash
| ier was charged with the embeZZle-
ment of $4,000 in cash and $36,7OO in
Liberty bonds, but the shortage, ac-
cording to information from bank Of
ticials, will probably reach $4,000. 1t
was not the custom of the bank to
carry a large cash reserve, and most
of the speculations of Olmstead were
made through the hypothecation OF
Liberty bonds, railroad bonds and
other valuable securities.
Olmstead has been cashier of the
First National bank since its organlZa-
ton in 1908, and was implicitly trust
ed by the directors and most OF the
patrons and residents of Union Bridge.
Many patrons of the bank were in the
habit of leaving valuable bonds in the
keeping of the cashier without ac-
cepting a receipt for their securities,
and many OF these are said to have
suffered severe financial loss for being
so confiding.
The act for which Olmstead. is most
| severely CGuSul GU ny hlo ~" Va
Union Bridge was in borrowing $4,000
the life savings of an. old gate tender
on the Western Maryland Railroad,
who had that sum in bank. O!mstead
is said to have offered the old man
six per cent. interest on his money.
which was drawing a safe four per
cent. as a savings account The old
! cate tender accepted the proposition
Of the cashier and turned over his
savings for a note. When the crash
came il was found that he had been
credited with six per cent. interest
on his account in his bank book, but
his money was missing.
II has developed that Olmstead was
conducting his financial operations
through firm of Baltimore brokers
AS it is unlawful for a bank officer
to dabble in stocks Olmstead, it is
understood, represented himself as
real estate dealer and took his Sc
curities, or the banks securities,
to the Baltimore brokers to be
used in his stock speculations. The
gloom Of the directors and deposit
tors OF the bank was to some extent
dissipated when the sum of $25, ,0cC.
due Olmstead as margin on stock
speculationS was recovered from the
brokers.
Under the law of stockholders of
bank. in a contingency like that ex-
isting, are required to double their
ST ck. The capital stock of the First
National is $25, 900 and there are sur
plus and undivided profits amounting
to approximately $31, 900. These sums,
with the $4,000 margin money, total
$S1 900 and will, it is thought, more
than cover the shortage. 1t is the gen.
eral belief at Union Bridge that the
bank, after its present difficulties have
been adjusted, will reorganize for
business at the same old stand.
"If it is true that Olmstead has
nothing left except what he turned
over to the bank l pity him and SYM
pathize with him." said one of the di-
rectors. 81 cannot believe, however,
that man as smart as he was has
not laid aside a big sum out of his
; stealings and that some time in the
future his family will be able to live
better and more comfortably than will
my own. This thought is not calculat-
ed to win my sympathy for him.
Several OF the Union Bridge bust
ness men admit that they now realize
that Olmstead has been living beyond
his means for a long time, although
the fact was unnoticed . before the
shortage was divulged. The salary OF
the cashier was $500 a year, but he
managed to build a comfortable home,
raise family of several children and
drive an expensive automobile.
Washington, June 5.-Shortage of
at least S150,O00 has been uncovered
in the accounts of the First National
Bank, of Union Bridge, Maryland, it
! was said today at the office of Comp
troller Crissinger of the Currency. f.
F. Olmstead, cashier OF the bank. is
at liberty. under $4,000 bond.
The DeVilbiss show did not arrive
: on scheduled time in this city.
, They were to appear here this week
, but up until this time they have not
showed up. They were at Union Bridge