Las Vegas age. [volume] (Las Vegas, Nev.) 1905-1947, 1927-07-02
STATE FILES SUIT
TO COLLECT CHECKS
First Legal Step Taken To
Force Carson Valley Bank
To Pay Entire Shortage of
State Treasury.

o ray EnIlIe SnoTLdRe OF
State Treasury.
(Reno Evening Gazette, June 29)
A civil suit to enforce payment
by the Carson Valley Bank of
three cashiers checks amounting
to $516,32216, was filed at noon
today by the state with the clerk
of Ormsby county, thus institut-
ing the first step on behalf of the
state to collect from the bank the
total amount of the alleged state
treasury shortage.
Filing of the suit followed a
formal demand by the state that
the checks be honored. They were
presented at the bank and pay
ment was refused by Cashier Hor-
toa on the ground that they were
fictitious and that the records of
the bank disclosed that the bank
had received but $4.55 as con
sideration for the three checks.
The suit was filed by Attorney
General NJ. A. Diskin at the re-
quest of E. C. Peterson, state con-
troller.
The complaint asserts that on
December 81, 1926, the three
checks were issued by the bank
to Ed Malley, then state treasurer,
and that the bank refused to
honor them when presented for
payment on June 20. The COM
plant asks that the checks to-
gether with seven per cent inter
est after June 29 be paid by the
bank.
The bank has ten days to de-
murrer or to file an answer to the
complaint.
That the bank will resist pay
ment of the three checks was in
dicated today by attorneys for the
banking interests and a formal
reply or demurrer to the suit
which was instituted by the state
will be filed within ten days.
The three checks signed by H.
c. Clapp, forcer cashier of the
bank and now serving a term in
the Nevada state prison, were
held in the treasurer's office as
cash by Ed Malley, former state
treasurer, and it is the contention
Of the state that they are good
and must be hOnored by the bank
No effort will be made to have
the bank placed in the hands oi
the state bank examiner and no
thing in the suit win be directed
at the bank to embarrass it in
any way, it is said. The civil
suits will be heard in the courts
in the same manner that suits
for collection of promissory notes
are conducted.
Whether or not a compromise
offer will be made by the bank
has not been given out and just
what procedure the bank will take
in resisting the suits was not dis.
closed by its attorneys today other
than to state that the suit would
be vigorously resisted.
Formal complaints for suits
against the bondsmen of Ed Nal
ley and George A. Cole are now
being prepared it was stated by
the attorney general but when
they will be filed was not dis
closed.
In the original statement issued
by GeoIze WingfIeld, president of
the Carson Valley Bank, when the
alleged state treasury shortage
was disclosed on May 7, the his
tory of the three cashiers checks
was briefly told. The statement
concerning them said:
Il have been informed that the
state treasurer of the state of Ne
vada has been, and now is, carry
ing as cash items, certain instru-
ments, payable to himself as state
treasurer, purporting to be cash.
ler's checks of the Carson VaIley
Bank, numbered respectively 66O2
66O3, 66O4, for an amount aggre,
eating $5l6,32216 and all dated
December 81. 1926.
The records of the Carson Val
ley Bank show that on December
81, 1926, cashiers check No. e6O2
was issued In favor of j. w
Adams for s1.30, that on the same
date cashiers check No. 5000 was
issued in favor Of S. c. Smith for
$l.25 and that on the same date
cashiers check No. 1904 was Is
sued In favor of George Jones for
$2.OO making a total of s4.55.
nave been advised that the names
OF Adams, Smith and Jones are
fictitious"
interest on the $4,000 at sever
per cent amounts to more thar
$1OO day. The state suit asks
that interest on the amount star
today.