The Wilmington morning star. [volume] (Wilmington, N.C.) 1909-1990, 1944-01-12
nOTS0N CALLED
IN BANK TRIAL
Former Official Tells De-
tailed Story OF How
Books Were Kept

ASHEV1LLE, Jan. 1l.-lHt-Iue
detailed story of the complex sys-
tern of books and accounts that
hoffled bank examiners over sew.
oral years was related in U. S.
District Court today by James B.
Dotson former assistant cashier
~ the Bank of Black Mountain
who appeared as government
notson one of eight men indict.
od on charges of conspiracy tt
misapply funds of the defunct bank
Of black Mountain, pleaded mole
contendre and is not on trial. The
trial has been under way more
than a week.
Other defendants, all of whom
nIeaded not guilty, are: w. C.
Eoaeycutt former president; w
H Powlas, former cashier, Wood
row P. Miles and Robert E. Free
former bookkeepers of the Banl
of Black Mountain which closed
March is, 1913, and Lawrence ]
Pace, William Rogers and V
Borchgrevink, former officials O.
the Saluda River Lumber Com
pany.
Unuer the guidance of the dis.
trict attorney, T. Lamar Caudle,
the attention of the witness was
directed to the $1,000 loan made
by the bank to V. Borchgrevink
for which certain stock in the Sa-
luda River Lumber Company on
which nothing had been paid in
was put up as collateral. DotSon
testified that this loan was ap-
proved by the executive commit
tee Of the bank of which the de-
fendant W. C. Honeycutt was a
member. He said that the loan
was paid of with a $1,95 check
of the Investors Syndicate payable
ia Honeycutt, plus $1,000 from the
special account in the bank of
Hoaeycutt, plus a fictitious charge
of $1,000 against the account of
E. L. Dupey, plus a fictitious
charge of 1855 against the Black
Mountain Presbyterian Chur c h
Manse fund of which Powlas was
treasurer.
The witness testified that on an
bank paid interest to Honeycutt on
the sl.945 check on at least three
occasions, the payments. accord
ing to the records which he identi-
fled. being approximately $11O on
each occasion.
The witness testified that on on
occasion he had conversation
with Honeycutt in which the latter
stated that he should have interest
on this check since he was him
self paying the Investors Syndicate
interest on the money.
The witness then told in detail
of two other occasions when the
$1,000 loan was made to Borch-
grevink on the same collateral,
stock Of the Saluda River Lumber
Company, and then told how
final loan of this amount was re-
newed some six times, the renewal
in each instance being approved
by the executive committee of
which Honeycutt was a member,
according to the records.
Dotson also testified about the
$4,000 loan made by a Charlotte
Bank to Honeycutt and Powlas and
described how this money was
used in clearing up certain items
in which the Saluda River Lumber
Company's account and its over
drafts resulting in manipulations
Of other accounts were involved.
Dotson described in detail how
Pace and Borchgrevink came to
the bank Oh one occasion while
PoWla was on his vacation with
check for $812.58 drawn on the
L Saluda River Lumber Company.
The witness testified that he had
been Instructed by Powlas not to
let Pace have any more money
without first getting the approval
OF Honeycutt and as result of
ms instruction refused to pay the
check.
he said that a little later, in
response to a visit from Pace and
6ofchgrevink, according to his in
FORMATION, Honeycutt either called
nm or told him personally to pay
The check.
he said as result of this in
sFuctlon from Honeycutt he did
pdy the check and when the bank
VloSed this item was still being
gaflled by the bank and never
'eeh charged to any account.
uotSon earlier in his testimony
wa the court and jury that when