Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-10-17
LABOR BANK LOOT
PUT AT S1O2,5DO
Salesman Sought With
Money Estimated at From
$500, 900 to s425,000.


PITTSBURGH, Pa. October 16.-
4 Nation wide search was under
way tonight for Charles f. Knapp.
bond salesman, who disappeared
Yesterday with satchel containing
sum variously estimated at from
1920 900 to s425.o00. of which more
than 100000 represented funds of
the Brotherhood Savings and Trust
Co. of Pittsburgh. labor bank
Search for Knapp was started
after the bank was closed today and
its affairs taken over by the State
banking department and four per
sons, including three officers of the
institution, were arrested on various
charges growing out of the alleged
swindle. They are r. a. McCrady,
president of the bank; William Kelly.
vice president: J. L. Nelson, secre-
tarv. and Frank r. Redman. All are
charged with having been involved
with Knapp in bond deal through
which they were to purchase Seoo,-
900 worth of Liberty bonds for
s425, 900.
: Shortage Put at s1Os,500.
r. p. Ferguson. chief bank exam
iner. said the shortage of the bahk
was about s102.500. so far as was
known. Redman. non -depositor,
was said to have indorsed a note
through which that amount was
Withdrawn from the bank to COM
plete a pool for the purchase of the
bonds.
When ARA igned for preliminary
hearing with the others, McCrady
said
II was gyped and 'gyped right.
They were sure smart fellows when
they put a thing like that over on
banker
He said the bank had sufficient
assets to pay all depositors and that
the institution would pay $500 for
knapp's arrest. The hearing was
continued.
McCradv told detectives Knapp ap-
proached him several weeks ago with
a propositlon to buy liberty bonds at
q big discount and quoted the bond
salesman as saying he had several
similar deals pending involving S.
100000 Of bonds of a bankrupt
banker whose identity could not be
disclosed.
Money turned UVer.
The bank president related that
Knapp appeared at the bank yester-
day and was given the cash. which
he told detectives amounted to $780,
900. and later placed the figure at
s4o5 900. OF the fund. s1oo,0oo was
said to have been contributed by a
Pitt tsburgh broker. and the remainder
was represented by the sum obtained
from the bank and smaller amounts
from individuals.
Roth men left the bank in taxi
cab. Knapp taking the money with
him, according to McCradys report
to police At a nearby corner NC
Grady left the automobile with the
understa nding, he said. that Knapp
was to get the bonds and return to
the bank within a short time. When
the specified time passed and the
bond salesman failed to appear. Nc
Grady said he did not become imme-
diatelv alarmed. believing Knapp had
been unavoidably detained. After
police were notified some hours later
it was learned that knapp's wife also
was missing from their apartment.
Some Officials Skeptical.
Detectives said they We're told
Knapp had been given the money a
week ago to make the deal. but re-
turned 1t later with the eXpla nation
that he@could not close negotiations
at that time. Police were seeking to
trace the bonds and their ownership,
but some of the officers were skepti-
cal whether any such securities ex-
listed.
The Brotherhood Savings and Trust
Co. was organized In 1923. with rep
resentatives of various labor unions
as directors. 1t was capitalized at
$15S, 400 and had assets and liabilities
of $72s,619. of which $52e.616 was in
deposits, mostly those of working
people.
Charges of conspiracy were filed
against McCrady. Kelly, Nelson, Red
man and Knapp by Bank Examiner
Ferguson. Later in the day charges
of conspiracy and larceny were filed
against all of them by city authori-
ties. with additional charges of en-
bezzlement and fraudulent misappro-
priation against each OF the bank Of
ficials. McCrady was released on
$1o5 900 bail tonight. The others were
unable to fnd bondsmen.