Evening star., 1933-07-06
ENGINEERS CHIEF
FIGHTS FOR POST
Brotherhood Move on to Gust
Johnston, Who Was
Indicted.

BY the Associated Press.
CLEVELAND, July 6.-Rugged Al
vanley Johnston, grand chief engineer
of the Brotherhood Of Locomotive En-
gineers, Is battling on two fronts-for
his Office before the Triennial Conven-
ton, and against indictments growing
out of the closed Standard Trust Bank
investigation.
Roots of the grand chiefs troubles go
back to 1920 when the energetic War
ren S. Stone, then grand chief engineer,
dreamed of q new day for labor-when
labor would cooperate" with capital
lists in the realms Of finance.
The dream was speedily translated
into a veritable labor empire-an en-
pire Of finance that embraced Nation
wide chain of brotherhood-owned banks,
skyscrapers, coal mines, investment
corporations, holding companies and
real estate projects.
Such success inspired other labor Or
ganizations, and by 1925 the phenome-
nal and highly publicized labor bank
ing" movement had grown to more than
80 labor banks.
Origin Of Bank Idea.
The brotherhood had millions Of
dollars in its general, pension and in
surance funds from its 10000 dues
paying members, and q 14-Story office
building in Cleveland that had paid for
itself in 10 years, when Stone began
to dream of a brotherhood bank.
On November /, 1920, on the eve Of
the 1921 depression, the Brotherhood
of Locomotive Engineers Cooperative
National Bank was opened in Cleveland
with a paid-in capital and surplus of
81, 100000. The brotherhood and men,
l.<.v-, ,@<,<1 80 nntN
capital were limited to 10 per cent,
among depositors.
BY 1926 total resources were $28, ,000,-
600, and by 1925 there was a brother
hood d-controlled chain of Is banks
reaching from Spokane to Boston, from
Minneapolis to Birmingham. Total re-
sources were more than $50, 0,000, 900.
Stone once said more than go applica-
ttonS for new banks were on his desk.
The brotherhood increased its sky
scrapers in Cleveland to three when 1t
bought structure on Euclid avenue,
and then In 1925 built History build
ing for the new bank.
Equitable Building Bought
Within two years working control Of
the Empire Trust Co. in New York,
Stones window In Wall street." was
obtained and the Equitable Building
was bought Through the Empire Trust
the brotherhood even had a branch in
London.
Stone said the investment corpora
tions and banking aff1liateS that null
tiplied were to free labor from wildcat
schemes and bad stocks"
One Of the first deals Of the new
bank was joint purchase with large
bank In Wall street Of q railroad bond
issue, the brotherhoods portion first
being offered to workers on the rail-
road
A company was organized and five
coal mines purchased In West Virginia
and Kentucky 10 be operated on a
profit-sharing basis with employees.
This venture brought trouble with the
United Mine Workers Of America and
the American Federation Of Labor,
whose officials charged Stone with
trying to operate an open shop"
Suddenly, in 1925, Stone died, just
as he was preparing to move into the
new bank building.
The brotherhood embarked upon new
ventures, including an elaborate farm
reflnancing plan in the Northwest and
q 31,000-acre real estate development