The New York herald., 1922-02-23
Brokerage Firm, Headed by
Former Treasurer of L. S.,
Has Big Liabilities.
RESIGN AS BANK HEADS
Members of Distressed Firm
We're on Board of Progress
Institution.

Federal receivers in bankruptcy
were appointed last night for tie stock
brokerageshouse of Kardos & Burke,
32 Broadway. The firm, of which John
Burke, former Treasurer of the United
States and three times Governor of
North Dakota, is partner, maintains
branches in many cities. Liabilities
were estimated at $1,5O0 900 and as
sets as s15o,OOO.
Judge Learned Hand in United
States District Court named Robert
p. Stephenson receiver under $25, 900
bond.
Immediately following the announce
ment of TIE receivership Mr.. Burke,
whose home is in Washington, an
nounced that he had resigned as presi-
dent and a director of the Progress
Bank of this city.
The involuntary petition In bank
ruptcy was filed by Lawrence Beatty Of
New York.
Bank Denies 1t Is Involved.
Burke as well as for the Progress Bank.
issued statement emphasizing the as
sertion that the bank was in no way
involved in the failure.
Mr.. Ross said that the information as
to the firms financial condition upon
which the proceedings Were. based was
several weeks old and that since that
time heavy Withdrawals and calls on the
part of customers had reduced the liza
bilities to about 100000 He said II
would probably be found that the assets
upon careful liquidation will yield suf-
ficient to pay creditors, ii not in full, at
least very substantial dividend"
Louis NJ. kardos. Jr., the other part
ner. announced that he also had resigned
as director of the Progress Bank.
Kardos & Burke hold membership
en- the Consolidated Stock Exchange.
Insfdious Propaganda Blamed.
Mr.. Ross. in his statement discussing
the failure. said it was due to insidious
propaganda disseminated in the various
cities where Kardos & Burke maintained
Offices"
There has been a continuous with
drawal and transfer of accounts" he
said. with the large overhead ex-
pense it would have been impossible to
continue business without seriously af-
eecting the rights of creditors"
Commenting on the disparity between
figures on liabilities ard assets given
in the bankruptcy petition and those an
nounced by the firm itself, Mr.. Ross said
the former were grossly exaggerated"
in the case of liabilities and grossly
underestimated" in the case of assets.
The attorney declared that he was
certain the assets would reach a mini
mum of $500. 900 when funds In the firms
branches in Chicago, Pittsburgh. Balti-
more. Philadelphia and Boston had
been added to those available in the
home office.
To Consider designations.
Shortly before midnight directors of
the Progress Bank responded to their
attorneys call for a meeting in an up
Messrs. Burke and Kardos as president
and director respectively. Before the
meeting Mr.. Ross declared there was
no doubt they would be accepted
"The bank Is in 10 way involved in
this failure" Mr.. Ross asserted. THE
embarrassed firm has no connection
whatsoever with the bank other than
that Mr.. Burke and Mr.. Kardos owned
ten shares each of the hanks stock to
qualify them as directors"
The Progress Bank, established here
in 1919, is listed as having capital stock
Of s224.000 and surplus and undivided
profits of s2S,700.