Putnam patriot., 1925-03-20
Directors Of The First National Bank
 Threatened With Suit for NeQliQenCe
RECEIVER NOTIFIES OFFICERS THAT HE WILL HOLD THEM ACCOUNTABLE FOR LOSSES OCCASIONED
 BY ALLEGED UNwARRANTED LOANS
Invited Consut With Counsel For ReceiverCes Specific
 lnstances Where Negligence Is Claimed

Possibility of legal action is facing the directors of the First National Bank of Putnam unless they make good certain alleged losses suffered by the bank on unsecured loans. The liability on the part of the directors for certain losses thus suffered by the institution Is alleged to be due to gross negligence on the part of the directors in making or ratifying loans and, in some instances at least. ex- ceeding the .Iegal limit in amount loaned. as prescribed by law.
 Receiver Gives Notice
 While it Is believed that this ae- tion eniinates from the office of the Comptroller of the Currency at Wash ington any steps taken will be by and in behalf of George Nj. Coffin. receiver of the First National Bank. It was through letters sent out by the receiver to each member of the boardi of directors that the first knowledge of there heing possible action for al- legged negligence became known. This letter. 1t Is understood, informed the director Co whom Il was sent that in the opinion of the receiver the diree- tor was legally responsible for eer. tain losses on loans made and invited the director to eonfer with Attorney Charles Y Scarls. counsel for the re- ceiyer. in regard Go the matter.
 No, Promo to Talk
 While itis admitted that such let. ters have been sent out. and that un- less the direntors fuake some settle ment legal luetiYn will follow, those ia position tu know the details of what has SO far been done in this diree- tiou are not making those details known. The only statements obtain able from feliable sVnrees are that the letter has been sent out and that un- less there is settlement satisfactory to the reeelver suits at law will fol- low. the casek in ali probability being made resurnable tpthe United States court.
 Directors Meet
 The directors held a meeting in the community room of the Putnam Savings Bank. Saturday, to discuss the natter What transpired at the meeting has nut been made public. It is known however that some of the directors in person and others by counsel have visited the office of Att torney Searls for an interview. What progress, if any, has been made tend ing to an adjustment of the matter, is unknown.
 Three Instances Alleged
 It is understood that the negligence in making loans is complained of in three specific instances. The iirst IS on note of one Edward Murolo, dated October 1, 1923, payable 3O days after date, the First National Bank being made the payee. IL is al legged that at the time the loan was made, according to the makers own statement, he had no property of any kind. and did not file any financial statement with regard to himself. lt Is further alleged that this note was from time to time and at the time the bank closed remained part of it's assets, there being evidence m the hands of the receiver that m" dicates that the money was used to pay for portion of a partnership with a Thompson contractor and at the time the bank closed it's doors the of Murolo individually and as a partner amounted to about s7O.OCO. This loan 1t Is alleged. was approved by the directors at meet | ing October s, 1923, and reafiirmed at a meeting October 18th.
 The Monson Co. Loan
 A second allegation is in regard to A loan of s25,000 to the Monson Worsted Company of Monson, Mass. the note for this amount appearing among the banks assets. In addi- tion this concern was indebted to the bank for about $33.000 on checks paid by it for the benefit of the com pany, making total of approximate ly s5S.000.
 The Monson Worsted Company was organized by Thomas ,. Corcoran, Jr., formerly of Putnam and fur a mum Der of years agent of the French River Textile Company. Mechanics vile. The company went into the hands of a receiver and recently ap- peared in the bankruptcy court at Boston. It's assets were listed at $57,453 and liabilities at $l4s,5so.
 Worcester Co. Borrowed
 The third allegation concerns the Robert Machine Company of Worces- ter This company. lt IS alleged. ls