Evening star., 1924-10-05
BY !. 4. FLEMING.

Trust Co. one-time mighty financial in
stltution of Washington. was recalled
last week through the report of Herbert
L. Davis. court auditor. of the receiver
snip OF Tucker X. Sands. one-time prom
lnent banker of this city, and also of the
second receiver, William X Qunter. in
handling the liquidation Of the assets
OF the company for the benefit of the
shareholders
The statement was also made in con-
nection with the filing of the report that
the trust company named had failed
in 1913"
AS matter of fact the United States
Trust Co. never failed. A run started
on the main offices of the company on
Tuesday afternoon, November IS. 1918;
spread slowly during Wednesday and
became a wild and furious scramble at
the main office and the five branches on
Friday afternoon. the 21st of the month
Then at the Shoreham Hotel that
night, some time between o'clock and
midnight, arrangements were completed
whereby the Munsey Trust Co took over
sufficient assets to guaranty the paw
nent OF the sG,oo0.000 odd deposits and
the different premises under lease as
main and branch Offices leaving the
shareholders of the s1,2JO,OOo institu-
ton to go by the board or to be served
as they might in liquidation.
At that time the United States
Trust Co. operated the main office
where the Merchants Bank and Trust
Co. is now housed: the Dupont branch.
now operated by the latter company;
also the present quarters of the
Franklin National Bank. the bank
ing room formerly occupied by the
Merchants and Mechanics Bank at
Seventh and q streets northwest, the
northeast corner of Fourteenth and
L streets northwest and the north
east corner of Twentieth and Penn
sylNania avenue northwest.
4 Big Institution.
1t was a big institution. with one
of the finest locations and banking
Offices for the head Office. from which
negotiations had been carried on for
the purchase of the Merchants and
Mechanics Savings Bank. with three
branches, and the Fourteenth Street
Savings at Fourteenth and L streets
northwest. paying United States
Trust shares at $50, plus SEQ share
for the Merchants and Mechanics
stock. or $40 a share outright:
while the Fourteenth Street bank
cost Sl10 Z share.
n had thousands of depositors. one
estimate being about 10000 Many
accounts were small. but when the
no more chance Of stopping it than
there would be in q beavers effort
to dam Niagara And il was fairly
underway when the closing hour of
business on that Friday aftern Don
gave the tired officers some respite
Bankers Busy Elsewhere.
But it gave no respite to cashiers
and vice presidents of other banks
who were busy with their collateral
preparing and sorting out high-grade
stuff on which to secure loans should
the fftful fever spread. the United
States Trust Co. fail and runs be
started elsewhere.
No one would dare predict the ex-
tent of the disaster that might fol-
low the failure of the big trust com
pany i'll the event of this actuality
Certain it is that even the very
soundest of our institutions would
have felt the result more or less
seriously. while many OF the less
strong banks might have found il
impossible to have gathered their re-
sources in time to have met the de-
mands of crazed dcpositors clamoring
for that to which they were entitled
but could not get all at once.
Stock Is Supported.
The shares of the trust company
change and for a few days it looked
as ii the company might weather the
storm. \ week before its sale stock
sold on the exchange a S136. eased
Off little. and then came back on
that last awful day when it closed
at 133 to 135. The trust company
might have weathered the storm at
its main Office, but the crowds at
the branch offices prevented.
lii = 40 II
a courageous fight through the four
days during which the run continued
TO grow and paid out millions of dol
lars An undercurrent of rumorS of
unsafe loans helped to accelerate the
trouble and left Mr.. Jordan and his
associates no resource except the saw
ings. of the depQsitors. with indiffer-
ence to his own fate and to that
of the institution that he had founded.
Very Cheap Purchase.
Inside terms were never made
known to the public. Ii was stated
that Mr.. Munsey had agreed to guar
anty the deposits and take over the
branches, which he did, and also
the lease of the Bond Building, which
probably proved profitable.
National bank presidents sum-
n1oned by the Controller of the Cur
rency, John SIX elton w lliamS, were
asked to indorse q note for 81 900, 900
which furnished the immediate cash
needed for the demands of depositors
and the controller further secured
the note by s1.006,00o of the choicest
assets of the United States Trust Co.
Page advertisements on the morn
ing Of the ed and 23d told the story
of the safety of all deposits in the
United States Trust Co, the depos- '
itors were assured, and the run. the
only one in Washington in many !
years. was at an end.
Organize Land Company.
Almost imm ediately following the !
of Tucker X. Sands as
receiver of the remaining assets Of
the United States Trust Co, the !
Chevy Chase and Great Falls Land |
Co. began to be heard of.
Later an offer was made to ex- |
change stock of the land company |
for United States Trust Co. shares. on |
the basis of $40 share for the latter. |
Some 400 shareholders accepted the offer. |
Now. after nearly IL years, the |
auditor of the court reports that Re-
ceiver Sands Is liable to shareh olders |
and directors of the former United !
states Trust Co. for $50,64 that he has
paid himself $3.50 in fees which are
and that fidelity bond of
500. 900 furnished by Mr.. Sands more
than covers his liability.
he a,,6i lori