Evening star., 1939-02-15
BY JOHN C. HENRY.

BY JOHN C. HENRY.
The Monopoly Committee today
turned its attention to business
practices of the Nations mutual
insurance companies, terminating
consideration of the extent of true
mutual control over the manage
ments through election procedure.
AS it's first item in this new phase
the committee received an exhibit
prepared by the Securities and Ex-
change Commission, showing the
Chicago law firm of Follansbee,
Shorey 81 Schupp, one of whose
members is on the Metropolitan
Life Insurance Co.'S Board of Direc-
tors, has received legal fees of
s359,080 from Metropolitan since
May, 1882.
Mitchell D. Follansbee, member
OF the firm and Metropolitan di-
rector since 1915, said he never had
voted as board member on the
fees going to the law firm.
The New York State insurance
law contains section prohibiting
officers or directors from receiving
fees or loans for services in con-
nection with property transactions.
Letter Reflects Interest.
Mr.. Follansbee's interest in this
legal business was reflected in a let
ter he wrote to Leroy A. Lincoln,
Metropolitan president, in May, 1882,
containing the following:
when I came on the board
great many years ago, when the
company was first mutual, I, or
some one else elected at the same
time, took the place of Mr.. Butcher,
and Mr.. Butcher was told in those
days that the policy of the company
forbade any director to represent, as
counsel, the company in any way.
That policy was changed, as I un-
derstand, and the evidence of the
change was that my friend, Sam
Fordyce, retained his legal repre-
sentation for the company after he
became director.
The company is apt to have a lot
OF important real estate foreclosures
IN this vicinity, and 1 write to you
as general counsel asking you to
give our firm, which has always had
both knowledge and facility in SIN
matters, consideration"
OF the total fees received. 1896 800
was IN connection with foreclosures
in the Chicago area.
Answer Is Denied.
The decision of the committee to
conclude its consideration of elec-
ton mutually was made in execu-
tive session and disclosed in an
announcement denying Samuel I.
Roth, spokesman for the Employees
Fidelity Organization, an association
Of Metropolitan agents, the privi-
lege OF answering earlier testimony
about agents Justification of cleo
ton ballots.
In denying Mr.. Roth the oppor-
tunity to testify, Chairman Summers
said the committee takes cognizance
Of the agents presence and assumes
their readiness to testify under oath
that they had not practiced falsifl-
cation of ballots.
This particular issue has been
gwen undue significance and
emphasis" Chairman Summers said.
1T was developed here merely to
illuminate the election machinery
In mutual company, not to prove
the practice to have been wide
spread.
There must always be a point
beyond which 1t is not necessary to
60 and beyond which 1t is utterly
Impractical to 60.
THE committee feels that further
evidence of this character would
burden the record unnecessarily and
Is not to be received"
Agents Gave Testimony.
At the time testimony on the
ballot Justification was given by
about a dozen agents from some
half dozen Metropolitan Of
fees, S. E. c. Chairman Douglas
said he was convinced the falsifca-
tions, consisting of forging policy
holders names, was q widespread
practice and that the commission
could continue for a substantial
period to produce witnesses to at
test to this.
Feeling the case had been rea-
sonably well established, the COM
mittee decided 1t would hear no
further testimony along that line.
At the same time, Metropolitan off,
caals announced they would under
take an investigation Of their own
and would guard against any such
practice In the future.