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New-York tribune. [volume] (New York [N.Y.]) 1866-1924, December 28, 1910, Image 2

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!.: fjV
. i%Vt .held off In hopes that the bank
.:' : #ruld be saved over the holidays."
Plain Statement of Hotchkiss.
The statement issued yesterday by
Superintendent Hotchkiss is a rcmark
•bl* account of kited checks- and mys
ttrious entries in bank passbooks, -with
the disappearance and alteration of such
tanks. .the. occasion seemed to de
ma no "it. The statement follows:
AS examination of the Aim* Indemnity
X>H&p«Jay of -Hartford by the New > crk and
Connecticut ••-„...!.' dopartmenie was
teun on Decen^er It. It is still inconi
miete, but has so .far progressed as to war
wilt the statement of tbe following facts-:
Joseph G. Robin -was In .March last trip
control stockholder of the jt-tna In
demnity Company and, apparently, of me
•J*orth«rn Bank of New York, located at
Ko. 211 West •-: street, the latter with
•cveral branches, among them tho River
side Bank, at Kishth avenue and fall street.
Jb« also largely controlled the Bankers'
Realty and Security Company, a. realty cor
*>o;-*.u'ok heavily interested in Bronx land*-:
the Fidelity Development Company <tlie
©wafer or the ;.d; .d Morris Park racetrack)
■ad the South Shore Traction Company- and
the Babylon Railroad Company. two KM
and traction corporations.
The Robin corporations, other than the
fcanks and the insurance company, all oflice
tujti..' on the eighth .floor of . the Times ;
Euildinc and seem to have* the same em
ployes. ~ Save as to the .Northern Bank, m
-which h« i* chairman of the finance com
mute, Robin appears not to be an officer
©f any* of these institution."', hi* control -or ■
iDf .<■•- ' :- ">-: exercised through on« or
111 confidential representatives. Such
•control ***rr..' however, to ■■•" absolute, and
his connection with most of these corpora
tions such that they and their assets are
•practically his property, subject to use. as .
■c may *cc fit.
One of the .bier" assets of the .'Etna In
«Ceianitv Company «a Connecticut corpora
1 ci in no way related to the JBtna Life
. ■ .- -„>:•• Company), who« principal office
2s at No. .C - William street, and which con
ducts a surety, tldelity.. plate glass, and
Vurclary in^urano* 1 business, as well as an
«--: : dent and health business of limited cx-
IcbC was. aw-ordine to the statement of
December a. 190?. I,V» shares, or the entire
•issue, of the corporal© stock at the Tit'* 4
*■ ■* Guarantee Company of Rochester. The
j Jitter is a Nf- Tork insurance corporation,
'authorized to do a fidelity and a title gruar
' antee business. This corporation had,' how
» «- teen dormant for some time, certain
*3iii£ated matters preventing its dissolution.
■> Tease of its title pi^nt to a Rochester
l«-bstract company produced an income
?•» fclch. in "-a.fidTtiCT Io Its other assets, gare
ithii stockholding: «L--«-Uue-ot:sl6S'^!>? out of
lh« total assets of the .Etna company of
rcsixnately {I.<>OQ.«»>.
Negotiations for Rochester Concern.
' Coincident with an increase in the capital ]
•*totk of ■■••-, Indemnity last spring.
'""Robin seems to. have opened negotiations ;
tior the purchase from it of its- ownership
[of th*> Rochester company; About the same
'Time both companies fleeted new officers,
■iiiuei Superintendent ITnlwij becoming
« ~id*-v of both, and Anthony Stumpf and
"" ism V. Lomai. two representatives -Of
CRobin. becoming, respectively, -.vice-presi
•<:-..• and secretary- The election of these
;rs*n seems to have been on March 2S. IPI
i»At. ihe same mi* a resolution was passed
feriir'ctin^ th« removal of the office, records
?«rjd «ss»ts of the Rochester company to
flNerr York. ?-nd en March 30 or SI Charles
|t\» Day,. t>. . com^ojiy's treasurer, brought
• wn to -the <-.fiw of the- Indemnity
JiConjpany. end later delivered them to
ompany. Robin's offic* 1 . Thereafter thinps
tuapf m-Ro'pin f offic* 5 Thereafter thmps
-....-* -v.^ ..-"r^ricrt- d story of which
iiii imi prior to th* rr^sent investigation.
;3o hai-e bc^.n l.mwn only 10 Bobta and his
-» ■ *". Central men. ;.--■.
s It appears that shortly prior to this tim« j
}2iobin. *s on* of tlie vftnaaaw says, had j
j*?tated that h* "oulfl purchase from th*» j
[ÜBuia the stock of th* Title and Guarantee
C mpan: On the strength of this state- j
;rr>^nt or proposition— for th**r« was- no con- !
Tract until October. f >— the w»eta of the
;!Foch*istcr company irere turned over to :
«3iim en March "1. apparently by Vic^-Presi
[ <i .nt Btumpf and Secretary I/)niax. and
|*«>lth air B^cistance. without the kno'Ri- ;
r-.r^- of President Kcl?e.v or the other offl- ;
-«*«rE of the two mtercet«d insurance com- '■
iTtni^c. »dispos-ed of an>3 manipulated sf ■
l^'rbin directed. -:■
' Th« only aufnorltv for transaction? -which :
fcave STestiy <-2erl»ted ■-.' assets of the
'Tiochester company seems to have bMO
'^Robins orders snd s tvo-y*ar-oM resolu- '
tion '■ that company's board, passed un- '
ifier uiotjiec inana?em*-rx After March 2?.
.the litls --- Guarantee -Company's board J
'j-s-d but en* . rr>e?Tine. thst" in October, to;
C":aje a din4end Stumpf and Lomaa
: ifle no "report . •" that meeting of vnaf
t-f hafl been doing. Indeed, the present ■
'Inquiry «as based on a falsification of the ■
JBtna Indemnity's passbook in the North- j
era Bank. The manipulation of the Eoc-h
ester company's assets • v not then known
«- .■?i<-i* th« inner -circles of the Robin j
r - Herto
-
Tells bI Rcbin's "ExcHanges."
-fsTv-day. Jti;?:r£ecytitl££-Qf ■':.' Rochester
company were rut in Robin's safe, or the I
*I%y . £cnt>wlaE,r h^.."Fxrhansed r * a v Zi7,QQO
L r -«- s -; of >'t--v- York -City corpArat*- i
■ stock; for 'bonds" of the South Shor<» !
■ Tractien Company, it then leased, snd i
"tvfclch. so tar as On record fhowc. were j
* Mtenbed only by a BomewluM mvthicaj I
«sut bill, until December 21. and then only
I "by * typewritten Interim certificate, the
valu* or vslidi«y of which is still problem
atical. Tb» jr.*- 1 " ICew Tork corporate
Btook s«ms. noirevwr. T.i have pqps<=d to
the South B&are Traction Company, and I
now to be held by the Controller of the I
City of K«v York. sf security for s.uch
t.ompany*s obligations 'to. the clty» •■ . .
In addition, a <~ash balance of from
i F 10.009 to SIS.OXJ was usML j»nd good mor»-
JjFages disposal of. sad (hue an "exchange" i
• fci about ?;- --v, of the "bonds" of the
I ibylon Railroad Company, an old horse
«-ax line then being, or sine*. electrified.
■<ocotnplished with similar treatment as to
cue bill, and Interim cnincate. Needing !
r ra mon*»y. however. Robin- caw
• rnpf and Lomax to execute the Roches
ter company's not* fcr PMH, caused it
jo be discounted in his. the Northern, bank.
itfnd then sold to the insurance company {
Jor the proceeds ?:,.*, '«>i worth of tbe stock '
[of his FMality Development Company. All
* hi and more of the same sort, though in
Fmaller amount, before he p?td a dollar tor
*h*> stock holding of the Rochester com
f^r' 1 and without the. directors of that j
!< - ;ompany. save Stumpf and Lcmat, know- i
'Sns what •was Poing on. .-;.-;»-.
', Am a •-.••. utieji ' ii « prsMßrf investiga
♦jr... beean. instead of assets consisting of
• approximately SlW.fiOft and practically no I
< liabilities, the Title and Guaranty" Com- |
rpany of Rochester now owes $50,003. and j
•' siss~azainFt it. besides "'lvj-nds" and stock
■i« the Robin concerns, whose value is
problematical, approximately 5105.000. a net !
»■ - > -<Mas><~. the 550.000 not* h»>!ng considered. !
'cf about $125.^W. such shrinkage to J>e re- i
i«?';red. of course, by the ultimate return
ftmni th" Robin securities.
; Th*> Rochester rompajiy's account has
*_«Ifo been used in VitinK transactions on a
;'«-£•<■ scale. • without loss, however. so far
■v has yet been developed. •
! Fortunatply. the Rochester company is
trot actively -in business, and the interests
Mir i>oll<"vhol<lcrs are not affected. Such
.<-- --.?■-. as an asset of the JEtn* Indcm
jmiu. Is. .however, much '•"■ valuable. *
:..i_. Call* Operations Culpable.
• _ Kai Robin's operations in the Northern
j^srit wh^n seeking to carry out a contract
f*»T tb" 6 purchase, of th«» Rochester com
pany, which, it seems. was actually made
J • .- October, are more etartlinjr and culp- j
■«■• <?. Aram there was an exchange, Ron-,
»*n> Banker.-,- Realty and Security Com- :
4 pariv. about Octo^pr C 5. 1310. Kivinsr the j
'."Etna It* check for $50.f'iX) as part payment j
fr*r the Rochester company's stockholding, j
'end the .JE«na pivinF -iVie Bankers' Realty
;i^s check for 550.003 in payment for about 1
';Sso.<w» worth of the Babylon Railroad Cora- [
•"psnr "bonds."
Fcr the last iinretu"--ne<a check the .rEtna :
J revived nothing until on the night of De- i
• r mber 17. when "demand was made at the )
"Instance of the >?*•< York department and j ,
*■ -due 1 III" for. the. bonds, signed not by
the Banker*' Realty and Security Oom
pan: to which th« .Etna's check was pay
able, but by J. >', Robin, was furnished.
The "value or validity of this as an asset :
«-' th<i .^tna is thought doubtful. " It ap- .
r'P'Brs. ro»»v(-r. that during the seven
*■ weeks which intervened between the date
«<■ •-• .^ttia's check and the delivery of ,
i lie due bill President Keleey and bis as
'• ' ■ -ires made repeated efforts to cct the
• I sfls or a paper entftHny ih<»Jr company i
to them when issued. There is same evi
<"- ' that Robin assured them or their i
■Pel, former Senator Lexo«-. that It
■"as all ri^bt. a« tW Etna's "check had not
' sen used. It had been used, however, on <
SCvweasber 5.
The other $s«i<wfi check, that civ^n *o the
.*;ins as part payment for the Rochester •
company. had an Interesting history. It
■was d*>j>osited In th» Northern Bank, ,
through Vice- President Brower of that in-
Flitution on Octobej 21 ami credit Riven hi i
■?he Etna's passbook that day.- Xotulth- .
.■Mancine: this it .in. apparently on Rob- "
. in-s orders; held in the bank for collection '
'th«uph on a branch bank of the Northern I.
Jorated In I nr York Cit>-) until "December '
5< and then taken up. returned to the Baa I '
' Realty sad Security , Company and i
.cancelled, presumably no debit therefor {
;*rainst such comoany's account ha\ln? -
-^••n made meanwhile.. I
The interesting fact. hoTrever. is that • •.!
' ■ ■■■•. - passbook, which «»n October 2~ ■ •
■sßhwwed a deposit credit of V>OS/if). wh»p r*- _
t - n «i feftsr (aw November i baiaii in-r ;
-rho*,td-no tuch credit on that or any other [C
d«: . and no* has only eleven half pases j a
■Jkßpsta InsJ^ad of twelve, a* in the oth'-r I
<.--:.*? of tbiF r-rr.l- r
Etna's Check Not Deposited. J
• n*memb«rin? that tiie .JEXn&'F ehack to *
the. Bankers' Realty «a# not deposited on !
*r." :■' - £".. as ■■■■•■-. 'It will be seen i „
that in f r ■•- of th^ holding ••!..-. KO.OM 3
• b*ek "for colloction" the .•::.= ■ balance "\
r^r-.a:*"" as it should have been until No- I
.v*:nitisr 5- 2
• On that .day. however. Robin .'"■-.•; i
ir.or.*** in connectJcn with his railroad en
terprises.. Hence,, to make the -/Etna's ac-j r
count good. Robin lxsrroited J27.()P0 from
! the bank through Morris, his -confidential
I man. usin« collateral which he seems to
have acquired ; from ; the uDtna, and then
deposited the Ja*=t ' mentioned gum to the
vßtna's credit in Hie bank. The $40,000
check given the Bankers' Realty for thf
Babylon bonds was then put through, and
Robin. without the knowledge of the .^tna s
officers, had thus "borrowed" JoO.OOO of
tit*- -.•l-Xna s money— for such time as he
could hold the other $50,000 check on the
bank "for collection." I
Thus matters rested- until th*> importu
nity of the ifibia for the . $50,000 credit in
its -passbook, the latter now being in the
bank's possession, and "to be attended to j
soon" whenever asked for, forced another
move. -Without the knowledge- of the
t.*3tna's officers, Robin's man. Morris, on,
December ? deposited to the credit of the ;
vEtna in the bank a Bankers* Realty and !
Security Company check for $7,000, and left i
with the b:uik . again "for collection' j
Robin's personal ' check for $43,000, also \
! dated December S. the $50,000 "held for col- j
lection" check :of October 25 being then
I returned to Morris and cancelled. i
The passbook was then further rhanped j
in the hack of the book to "collection" en- j
tries, on« as of October 25.' for $43,000. and
the other as of the same date for $7,000 be- j
inp made. It has not yet been ascertained :
who mads these entries, but on the state- j
ment that the two "collection" cheeks were
certalnlr not In existence until December 9,
the admission by Morris, Robin's confi- i
dential man. that tht> entries were fakes |
■ seems justified. •' ,
On December 9 Robin still had MS.OOO of j
tlie -Etna's money, "borrowed" without its
knowledge. The examination ■ began th«
16th; and a departmental demand for the
missing passbook made longer concealment >
or manipulation impossible. Then this in- j
teresting transaction took place. Robin
• took his $43,000 note up at the Northern
'■ Bank by a draft on the Carnegie Trust
Company, -where be had no account, and.
giving such company, so the evidence i.«.
his note and ample collateral, met the draft j
first given by another on the Atlantic Na- j
tional Bank of Providence (of which Ed
ward P. Metcalf. a director of the .Etna,
, is president), where also he had no account. |
The state and national banking depart- |
i ments were informed of this transaction j
i apparently in time to stop It. Robin s draft J
on Providence -was protested, and the.car
neKßß Trust Company has hie not* ana ccl
lateral. His secret debt to the -Etna, *">'
thus paid.
Record for District Attorney.
As a consequence of these transactions,
however, the departments ordered all fund? ;
of the i:tna and the . Rochester company
withdrawn from the Northern Bank and
Its branch, the Riverside Bank, and placed :
the facts before the. Banking Department
As soon as the record is fully transcribed
it will be placed at the disposal of the Dia
trict Attorney .
Superintendent of Insurance- Hotchkiss j
has taken possession of all of, the remain-!
Ins assets of the Title and Guarantee com- ;
nany of Rochester. The latter company
win probably be liquidated by the New I
York department. There is undoubtedly a
i considerable shrinkage in the assets of the
! Jptna Indemnity Company, whose small •
i surplus is unquestionably Tviped out and I
whose capltsj is impaired. Whether this
company will be rehabilitated or reinsured
has no' yet "been determined.
The testimony taken is illuminating- as to
the methods of endless chain finance and
Is thought to emphasize the rule insisted
on -by the N"«w York department, that the
public interests demand that . when the
' control -of a. stock insurance company
' passes to net"- hand? it must be informed
as- to the transactten 1 and satisfied that
the new owners mean fair and are entitled
to confidence.
the folloTMinf: statement was given out
last nieht by th« JEtna. Indemnity Com
pany: •;";.*:
i Tn an interview with tie officers of the
.Etna Indemnity Company the latter stated
: that the report given out. by th» Insurance
Department was correct In its essential
particulars. They also said that as soon
Us knowledge, of tho manipulation by Mr •
Robin came to their attention they notified
the Insurance Department, of Connecticut,
which co-operated, with the New York de
partment in making a full and detailed ex
■ amination of tie financial transactions of
the affiliate! companies.
In reference to the statement mad© m tne
wpftr? of "the lasnranoe JDepartment con
cernlns 1 Mr. Stumpfs part in the. opera
ttons of Mi. Robin, the officers of the
1 >Etna Iri(("er,iTii+y Company stated that they
IN firmly convinced that. Mr. Stumpf was
a victim of displaced confidence in Mr.
ißobir and that when Mr. Stumpfs atten
tion was called, to the. transactions of Mr.
I Robin affecting, the Title, and Guarantee.
iCcmpanv he took immediate and effective'
measures to sco Jhat the .Etna Indemnity;
I Company and the Title and Guarantee Com
pany should not suffer in ■»? m.mner from
these operation?.
\p a result of Mr. Stumpf efforts thus '
I far Mr. Robin has been entirely eliminated
from the stock control of the company, j
and the officers of .the -Etna Indemnity
i *-o:ripany~ are now in a position to transfer I
I the control of that company to strong finan- j
I cial .interests^-. Negotiations with this end ,
Ifii view are nearfng compleuoii. " • : ' ' '
J: : HlChenej", .State Superintendent of J .
Banks, issued a short statement in which
! he said that the department had been \
investigating ihe bank for several day?. |
and had determined to. take possession 1
because of the conditions disclosed and ;
' certain irreg-ulgr transactions that had ,
taken place during- the progress of the |
examination. i
Arba K. Alford. an examiner in the
department, was appointed a special
deputy Superintendent of Banks, as
;.p:, to assist Superintendent/ Cheney
In the 'liquidation of the institution.
Deposits of Nearly $7,000,000.
- -Mr. Cheney- stated iha^the bank has a
capital of $700,000 and a. book surplus at
the time of its last published statement.
; November 10. 1910. of '$185,965. Its de
posits at that time were $6,912,582. No
further statement will be made by the
Superintendent of Banks until a com
! plete inventory of the assets is ob
tained, it was said. :^:
Robin, according to his friend?, began
i showine: si^r.s of mental derangement
j several weeks ago. He had organized
I a trolley system to go across the
QlUH'iiiilmro Bridge, which he financed In
• one of his various companies, and had
said that he expected to sell it to the
Pennsylvania Railroad and clear up
about $2,000,000 on the deal.
Robin had been hard pressed for funds
' from all sides in connection with his
business enterprises during: the last few
weeks, anil .recently his affairs reached
an acut* stage, his friends Bay. Ten.
days a>ro [he clerks in the offices in the
Times Building were put .to- work nights
with thr«e hours' allowance for sleep,
and RcbJn is said to have instituted
j other peculiar customs in his business
! offices.
He knew that the Insurance and Bank
' ing departments were investigating his
i affairs, and he fell ill under the strain
fa few days ago and retired to his bache- }
! lor apartments, at the Beaux Arts, at
! No. SO V\ 'ost 40th street, and his friends |
announced he was about to undergo an
I operation. . ■ .
' Meanwhile ; his • sister. Dr. Louise E.
Robiriowiteh— Robin had changed his ;
name soon after coming to this country
from Russia some twenty years ago of
No. 28 West 120 th street, and his conn-.
dential associate, Frederick K. Morris,
who was stricken with paralysis on Mon
day and is in a private sanatorium in this
city, retained Dr. Carlos F. McDonald,
the alienist, to examine Robin as to his
mental condition.'
Alienists Call Him Paranoiac.
Dr. Macdonald reported that Robin was
suffering from paranoia, un incurable
form of insanity. It was decided to have
a thorough examination made, and on
Monday afternoon Dr. Macdonald, to
gether with Dr. Austin Flint. Dr. WtM
man, of No. 108 West fMth street, and
Dr. Max G. Schlapp, examined Robin.
and after a consultation determined that
he was suffering from paranoia.
The .findings of .the aiicnlsts were sub
mitted to Justice Amend, of the Supreme
Court, in affidavit form, and he signed \
an order -of -commitment and Robin was j
removed.- in the company of attendants,
to Dr. "MacdonaJd's sanatorium at Cen
tral Valley yesterday.
Justice Amend said at his home. No.
2$ West 71th street, last night that Dr. j
Wildman went to see him on Monday
and said he represented ■ committee of
three physicians, including Dr. Carlos
F. Ma-donild. Dr. Austin Flint and him
TmW-YG&K DAILY TRIBUNE. WEDNESDAY, DECEMBER 28. 1910.
srltVwho had been examining into the
n*ntal condition '. of . Robin.
According, to the justice, Dr. Wildman
tixik "With him commitment papers show
ing that Joseph G. Robin was a fit sub
ject for a sanatorium. He asked Jus
tice v Amend to sign the commitment
Tapirs, and the justice did so. Dr.
Wildman is said to have told the jus
tice that on a previous occasion Robin
ha.<l tried to kill himself, and should not
be left alone and unguarded. Dr. Wild
man also produced the affidavits of Dr.
MacdonaJd and Mr. Flint as to Robin's
merits 1 condition.
Justice Amen* added that nothing was
said to .him at the time he signed the
commitment order of Robin being con
nected in any way with a banking 1 con
cern. _fcim at the time he signed the
cment order of Robin being con
ir> any way -with a. banking con-
Robin's Secretary Stricken.
".. Frederic K. Morris, for years confiden
tial secretary of Robin, is in a state of
collapse in a local sanatorium. On learn
ing: of his em-plover's Impending com
mitment night before last he went with
his wife and scon to see Robin, and was
there, taken dangerously 111. Hurried to
th« house of ft- neighboring doctor, he
•was found in no condition to be moved,
ana epent*the night where' he was. but
it was thought last night that he would
be strong enough to appear to-day as a
witness if called. -.'';; .::*_
It was said last night at Mr. Robin's
office in the Time* Building that Morris
was an incessant worker, and that bad
health had caused him to be absent for
a week or two several months agro. H>"'
was described as "the soul of honor" by
on» who knew him there, and it is feared
that this shock may be more than his
increasing years can stand.
The directors of the. bank did hot sus
pect there was anything wrong with its
•business affairs until last Friday, and
most of them who were seen yesterday
said they had bad great confidence In
Robin as a financier and business man.
postmaster Morgan, one of the directors,
said that only last Friday Augustus F.
Hotly, of No. 'M:> West End avenue, de
posited $00,000 in the. bank. He added
that Mr. Holly had a. balance of $60,000
at that time. Another director deposited
$100,000 earlier last week, It was said.
"The action of the banking department
came as a shock to most of u.s." Mr.
Morgan declared. "We did not know that
there mi anything wrong at the bank
until within the last few days. It was
not decided to suspend business until
last night.. We all had a great deal of
confidence in ; the bank. I don't know
anything about the irregular transac
tions, but I understand Bank Superin
tendent Cheney is investigating those
matters, and will issue a detailed state
ment when lie i? finished."
• Say? Robin Tried Suicide.
James 11 Gifford. counsel for the bank
and also a director, said that the irregu
larities at the bank were not discovered
until. last Friday. He said that Robin
had attempted to commit suicide last
Saturday night by attempting to throw
himself out of one of the windows of his
apartments in the Beaux Arts, but was
restrained fey a nurse.
''On Friday night, after the discovery
of the irregularities had been made," Mr.
Gifford paid, "another director and my
self went + o the apartments of Mr.
Robin, and demanded that he should do
certain things and produce certain col
lateral. He was in great agony, suffer
ing from .kidney trouble. I understand,
and It was plain to see that he was out.
I the irregularities had been made." Mr
(ford paid, "another director and myv
f m ent to the apartments of. Mr.
bin snd demanded that he should do
■tain things and produce certain col
ors 1 He was in great agony, suffer
r from kidney trouble. T understand.
3 it was plain to see that he was out
of .his mind. "We could not get a con
nected statement from him: He- evi
dently did not realize the importance of
our mission. •■--•■
Not succeeding in, .our . mission we
left, him and returned again last night.
His mental condition was . even worse
then. I understand that he had been ex
amined by alienists and pronounced in
curable, and was sent to a sanatorium
to-day. T knew nothing about the irreg
ularities discovered, and I do not think
any. of the other directors did. until they
were • revealed by the bank examiners
and our own investigators. Strong in
terests were negotiating- to secure con
trol of the bank. If the irregularities
had not been discovered it is likely that
the negotiations for the purchase of the
bank would have gone through.
'We held out hopes that conditions
would right themselves until last night
when in an all night meeting of the.di
rectors we called upon the State Bank
ing Department to step in. At this
meeting we adopted a resolution setting
forth the real condition of affairs. A
copy of the resolution was turned over
to Superintendent Cheney and later pre
sented to the District Attorney, I un
derstand."
While Sick Drew $100,000.
Mr. Gilford declined to discuss the
resolution in detail, saying that he did
not wish to do or say anything which
might impede the investigations by the
"authorities. It is understood, 'however,
that the resolution adopted plainly puts
up to two officials of the bank the irreg
ularities discovered. It was said yester
day that Robin had managed to draw
out more than $100,000 from the bank
during the last week, while he was sick.
"With cash amounting to about $2,000,
000 and quick assets of about $3,000,000,
some people might think it was ridicu
lous'for us to close our doors in this
way," continued Mr. Gifford, "but we
considered that as soon as the discovery
of the irregularities became public it
would certainly cause a run on the bank.
In view of this fact the directors be-
Ik«v£d that the interests of all depositors
demanded that we ask the state Banking
"Department to take charge of the ban
so that all would share alike.
"During the last few days certain of
the directors put in large sums of money
to strengthen the bank's condition, and
in some instances sums of more than
$50,000 were deposited by some of the
directors.
• "Robin, who had control of the ban
was chairman of the executive commit
tee. Ak chairman lift had great power?,
and it was for that reason the directors
did not know just what Robin had been
doing." '
Mr. Gifford was Inclined to think that
the depositors would receive KM) cents
on the dollar and the stockholders a sub
stantial dividend, if certain Robin col
lateral, could be realized upon.
The City Chamberlain's office had
$200,218 on deposit in the Northern
Bank. .Deputy Chamberlain Walsh, who
is acting Chamberlain la the absence of
Chamberlain Hyde, made a written de
mand last night on A. K. Alford, the re
ceiver of the bank, for the immediate
payment of the city's account, with In
terest. When this is refused a demand
will be made for tb* 1 money on the Na
tional Surety Company, which furnished
the bonds for the deposit. When a bank
in Brooklyn failed several years ago the
surety company paid the city on the fol
lowing day the money which it had on
deposit there.
Controller Prendergaet, who was a dl-
rector in the Northern Bank, said last
Light: ' '
"In the spring of 1900 a certain down
town interest acquired an option on the
majority of the stock of the Northern
Bank. At their request and. no other, I
accepted a place on the -board of direc
tors and. : executive . committee. When
elected Controller I resigned my place
Rnd sold the stock which - 1 had ac
quired -to qualify. „- -
"Since I have been in office I have
had no "connection with' the Northern
Bank. There was a small deposit of
trust funds from the Finance Depart
ment In that bank, which I ordered "with
drawn In the spring of. this year."
Wolfe Long Out of Bank.
Henderson M. Wolfe, chief auditor •of
accounts in the office of Controller
Prendergast, said last-night that he had
not been connected with the Northern
Bank as a director for some time. past.
"In May, 1909. I became a vice-presi
dent and a director of the Northern
Bank, representing prominent - down
town banking interests which had ac
quired an option on , the , majority of the
capital stock of : - the institution. I
served in this capacity until December
31. 190$. v.-hen . I severed my connec
tion with thd bank." , . :
Assistant Postmaster Thomas F. Mur
phy, former State Senator George W.
Plunkitt and other directors of the bank
said yesterday that "hey had no intima
tion that the affairs of the bank were in
such a.conditiOn as td demand drastic
action until the long meeting of the di
rectors on Monday night.
Many condition as to particularly In
until the long meeting of the .di
o'n Monday night.
• depositors were particularly In*
censed against the Northern Bank offi
cials because the Wast 125 th street bank
and Its branches had received deposits
up to a late hour Saturday. Some de
posits were- made ''after 'midnight Satur
day nisyht. Samuel Bacharach. a butch
er, of No. 204 St. Ann's avenue, in The
Bronx, said yesterday that he. had de
posited $800 in the branch at 138 th street
and Willis avenue at 12:10 o'clock Satur
lite avttme at 12: 10 o'clock Satur
day night! Bacharach showed his bank
book in -which the deposit was dated
December 27. He said that the- manager
of the ISSth street branch had told him
Friday afternoon that the bank would
be open to receive deposits until 1 o'clock
Saturday night
ROBIN CAME FROM RUSSIA
Name of Banker in Trouble Was
Robinowitch Originally.
Joteph O. Robin is a Russian whose name
was Roblnowiteh, but when he began to
coma Into notice in business affairs in New
York he dropped the last two syllables. of
his name. He belongs to a family of the
lesser Russian nobility, who were exiled
for political mesalliances. He Ml brought
to this country when he was a, small troy,
and first appeared in the business life of
the city jn'l£>6. ','. • •
In l*?s he was deputy commissioner here
representing the -Transvaal government,
and in IS?S he mad* his first banking con"
nections. By 1902 he had begun to get 'a
foothold, and for two or. three years was
el] considered as a man who -would be
likely to make his mark among the. smaller
bankers of the city.
His first connections were with building
and loan institutions, and. in 1896 he pro
moted the Popular inking. Savings and
Loan Association. This was not a success
ful venture, and Robin, as he was then
known, formed the Co-operative Building
Bank, which absorbed the Popular Bank
ing Savings and Loan Association. The co
operative concern got into trouble in 1300,
and Robin, who had then formed the
friendship of Allan A. Apgar. of the Mer
chants* Exchange- National Bank, got Mr
Apgar and some of his associates to help
in straightening, out the affairs of the Co
operative Bank. Mr. Apgar was a firm be
liever in Robin, and up to the time of bis
death declared that ili<% Russian was a
good banker and would make his mark in
the community. * .
The Bankers* Realty and Security Com-,
pany was formed in 1304 to deal in the real
estate- held and controlled by the Co-opera
tive Building Bank, and it was through this
company and the friendship of Mr. Apgar
that the affair* of the co-operative con
cern were put or a sound footing.
Robin, in the mean time, had organized
th« Washington Savings Bank. This insti
tution was founded in Is 9?, and in 1903
Robin branched out and got control of th«
Bank of Discount.. At the earns time he
took over from Edwin Goodall the control
and charge of the auairs of the Bankers'
Money Order Company, which was intended
to compete with the express companies for
the "money order business of the country
outside of that done by the government.
But the. express companies were too strong
for Robin, though he caused a flurry in
their affairs for some time, and Robin's
company was unsuccessful.
The control of the Iroquois Construction
Company, which was the holding company
for the Niagara, Lockport and Ontario
Company, pa-seed into the hands of Robin
in 1905, but he soon, sold out to the West
inghouse company, and it was chiefly with
the money realized from this deal that lie
bought into the Northern Bank of New
York, in which ha held SI per cent of the
stock.
By this time Robin had formed a friend
ship with E. R. Thomas and his ilnancial
coterie and was concerned in promotions
that doubled and redoubled on each other
and - multiplied with constantly .increasing
rapidity. . Mr. Thomas was in the Northern
Bank of New York and Robin was In many
of the Thomas interests. He was at one
time, a stockholder in the Merchants' Ex
change' National Bank, and until recently
had large loans there.
Since his entry into the Northern Bank
of New York his financial friendships had
been with. R. W. Jones, of the National
Reserve Bank, and formerly of the Oriental
and Seventh National banks; Edmund K.
Stallo, from whom ■ two trust companies
recently withdrew as security as trustee in
the management of the estate of his
daughters, the heirs of Alexander McDon
ald, and Herbert T. Jennings, a promoter
of country electric roads and real estate.
He was interested in a large number of
small banks in the country districts, but
while he held the stock he was represented
on the boards by other*.
In 1906 ' he was considered to be worth
about $1,000,000, but it is understood that
since the panic of 1907 his available funds
had not been so large. It is known that ho
had large loans in several banks, and one
New York bank in which hr was inter
ested iess than a year ago, and. it was un
derstood, was to be made the headquarters
of a banking system, taking in a chain of
email country banks, succeeded only in No
vember in getting the last of its loans to
him paid off after lie had been forced out
of the institution. : *<'.'.i '-l- : :'.ii'.
Robin was interested in the promotion of
the Huguenot Trust Company, in New Ro
chelle. and that company was until a week
ago one of the largest depositors of the
Northern Bank of New York. 'one of the
directors of the Huguenot objected to de
posits being kept with the Northern Bank
Of New York, and he was informed last
week that all the money of the trust com
pany had been withdrawn from deposit
with the bank and that Mr. Robin was no
longer connected with the trust company.
He was Active two years ago in assisting
the promotion of the South Shore Traction
Company, which, following the opening of
the new Queensboro Bridge, in June of last
year, obtained a franchise to build a trolley
read 'across that structure and over the
new viaduct that spans the Sunnyside yard
of the Pennsylvania Railroad, and then
along Thompson avenue, into Hoffman
Boulevard and on to Jamaica. \
Glowing pictures of the company'? plans
for furnishing transportation for Queens
wer»set forth in vivid colors at the lime,
but those plan? shrunk to operating a
shuttle- sen-ice to and fro across the bridge
OB city-built tracks and in second hand
cars, charging a 5-cent faro for the round
trip. It is said, however, that as a finan
cial venture this part of th« companv'a
operations has been a big success.
TELLS OF ROBIN'S METHOD
Vice-President of Rochester
Company Before Hotchkiss.
MAKES A "CLEAN BREAST"
Closing of Northern Bank Cred
ited to Evidence of Cashier
of the /Etna.
Anthony Stumpf. vice-president of th«
Title and Guarantee Company of Rochester
and a; ■ director of the ' Northern Bank. In
terrupted one of the. special headings in the
Northern Bank affair .conducted by the
Superintendent of i Insurance -within the
last few days in order, lie said, to make a
"clean breast" of all he knew and to offer
certain ■: securities^ he . had 'collected on
learning of the state Of the company's gen
eral securities. . ~\-- : —
He was allowed to take- the stand, Fred
eric K. Morris, Robin's confidential man.
having, been excused, for that purpose.
However, Stumpf was not allowed to swear
in his testimony.
His testimony Indicated that Robin oper
ated through confidential men in each one
of his companies, these confidential men
doing all the work of transferring securi
ties and writing checks to stand off other
checks, without the knowledge of their fel
low directors or the company's officers, ex
cept themselves. In his statement Stumpf
said:
••Ttro days ago -Mr. Gag© and Mr. Kel
s«y. Of the JEtn*. company, called my. at
tention to the fact that their company was
undergoing an investigation and that the
examiners had found that' important se
curities were missing. They said they had
ir.ade an effort to find these securities and
had succeeded in securing from Robin a
number of securities to the amount of
$62,000 or $63,000 and wanted td know what
had become of the rest. They said I had
received them and had signed for them and
was therefore morally responsible. I ad
mitted I had signed for them last spring,
but said I had turned them over to Mr.
Robin and Mr. Lomax and Mr Morris and
knew nothing of what happened to them
after that
Got Securities in Advance.
This circumstance was commented on
by Superitnendent lima as strang*. a?
Robin trail not the owner of the company
nd had no right to its securities. Stumpf*s
reply., was that Robin expected to buy the
company and so all the securities were
given to him In advance. Stumpf eaid he
frequently signed . papers without reading
th£m and always had absolute faith in
Robin"? "way of doing things."
He was asked a.bout some of thA "kiting *
checks by which accounts were matched
against each other, and said he remem
bered on». for $47,000 and had telephoned
Robin about it. and was assured it was
all right and was to pay for sonr? bonds
about to be purchased. Ufj
"Well. here's one for $50,000," put in Mr
Hotehklep.
"Oh, J forgot about that," was the an
swer. "I must have thought It was for
$800 when I signed it."
Then you signed almost anything that
was put in front of you""
"I guess I did. I was very foolish I had
too much' confidence."
Continuing with hi? interrupted narrative.
Stumpf said: . .;
On Wednesday. December 21, I felt I had
to see Mr. Robin about these things, and I
went to his home and tried to "get to his
bedside. I found him flat on his back and
not at all desirous that I should see him.
I had to wait two hours. Then I got to his
bedside and told him all these troubles, and
I Wanted to know what he had to say for
himself. He had a. trained nurse, and I
found afterward she was his sister. -:-.,■
I asked him where the securities of the
Rochester' Title and Guarantee ■'• Company
were, and he said they were all in th© safe.
I said I wanted them then— I wanted
to give them up. We made a search, and
162,000 was all we could find. He told me
to take full charge of- all his business and
use all his property I could find In the office
and see him through this business as well
as I could, being sure to see that all the
creditors were paid.
T left his bedside and went to the office
of the Fidelity Development Company. Mor
ris couldn't find the securities.. He found
some others, but not the ones I wanted, and
he filially admitted that the good securities
had been sold and others substituted in
their place.
He handed me a slip showing that the
Rochester Title and Guarantee Company
was owner of 500 shares of the Fidelity
Development Company, $57,000 South Shore
Traction bonds and $50,000 Babylon Railway
bonds.'
. I told him these would not do; that I
had to find some securities, something else
that would satisfy these people.
I got at the safe and looked over all the
papers. Th«n I discovered all this JEtna
Indemnity business. I got clear and free
2.525 shares of jEtna. I have, freed 1,550
shares held by the Northern Bank, and the
Carnegie. Trust Company has promised to
free 3,0& shares, making 7.103 shares in all.
I propose to turn over to you these securi
ties in lieu of the others.
Superintendent Hotchkiss said this would
not do, as it would merely be to reverse the
case by making the Rochester company
own the >.£3tna company, whereas the old
ownership had been the other way. about.
"Where is the $47,000 in corporate stock?"
asked Mr. Hotchkiss.
"That went to New York City on April
1," said Stumpf.
Etna's Cashier Testifies.
It was the evidence of Frederick W.
Bogert, the cashier of the rJEitna. Indemnity
Company, that first gave the alarm whtch
resulted in the closing of the Northern
Bank.
On Monday, a week ago, be was examined
by Charles Hughes, examiner of the In
surance Department, at the office of the
•/Btna, and there told of the sale of the
Babylon Railroad Company bonds to the
•.•Kma company and of the sale of the Title
and Guarantee Company of Rochester
stock to Robin.
Checks of the Bankers' Realty and Se
curity Company had been passed for both
purchases, he said. Robin had paid a share
of the purchase price of the Title and
Guarantee stock by a check of the Bank
ers' Realty and Security Company, said
Bogert, and this had been deposited in the
Riverside branch of the Northern Bank
and initialled by Vice-President Brower.
"Did you see the entry in the passbook?"
"I did."
"At what date?"
"That was on October 23."
"When did that passbook next go to th«?
bank"
"On October 31." .
"And when did it come back?"
"About the 3d or 4th of November."
"Did that deposit of $50,000 still appear in
the passbook?"
"It did not."
"What did you do about it?" ,'
"I took the pass book to one of our
vice-presidents. Mr. Gage, ami to Mr. Jo
max. Mr. Gage said he would send th»
book back to the bank to have it fixed up."
Mystery of a Pass Book.
"When did you next* get that pass 'book?"
"On. December 17."
"Did that ?r,<\ ( Wi deposit appear there
then?"
"No.. it did not."
"Where was the paas' book from the
early part of November, to December £7?"
"I do not know. Wo did not have it
during that time.'.! ;
Another^ striking part of Hie testimony
was that given by Frederick K. Morris,
who was the confidential secretary of
Robin.
"Have you personal charße Of th« "asgietst.
and records of .the Title and Guarantee
Company?" Morris «as asked.
"They* are 'not -In my name." he repllad;
"that is to say. not all, but some. I looked'
after th* mortgages and possibly tried to
keep the intexest level, but mart of ths
69 Years of Maintained Superiority
and Conscientious Brewing
The F. & M. OCIICICT Cr B rewin ? Co
OdlCiClCl Brewing Co
Holiday Brew
US **
On Draught at All Customers'.
Bottled at the Brewery
For Hotels and Restaurants— Family Trade Supplied by Leading Dealers & Grocert
Brewery and Bottling Works. PARK AYE., 50TH TO 5 1ST ST., N. Y.
other securities ara not in my physical
charge."
"Who had charge of them?"
"Some of them were In Mr. Robin's safe
and «otn6 of them in mine. Jlr. Robin has
in his safe the- Babylon Railroad bonds
and the South Shor© traction bond*.."
j "How much did the Title and Guar^nte<J
Company Invest In the Babylon Railroad
bonds?"
"Between $40,000 and 530,000."
"On March 31. we find here, Mr. Stumpf,
vice-president of the 1 Title and Guarantee
Company, gave Mr. Day. the treasurer, a.
receipt for certain papers. Do you knov/
where those papers are now?"
"They are up in my safe, mop of them/*
List of Books in His Care.
% Morris then proceeded in reply to ques
: tions to tell that the bond and mortgage
I register, the cash book, ledger, journal,
trial balance stock ledger, stock transfer
ledger, policy registers, the check books of
the : Security Trust Company, the com
pany's seal and the. Ella F. Sullivan ac
count check book were in his custody and :
j under his control ,
"Is the minute book in your custody and
| under your control?"
"No, that is In Mr. Robin's Mia."
"Can you give any reason why these
papers and packages* should have come
into the control of a man who was not an |
officer of the company at that date?'
"None, except that it was convenient. ''
That was all." : " •".; ..♦£> • ".-'• ;7'; 7 '
Frederick D. Kilburn. chairman of the
board of directors of the .^:tna Indemnity ]
Company, testified that he and Tcobin had
been made members of the board In Octo- j
ber, 1907, to replace Arthur P. Heinze and
H. M. $chu]tz<\ As president from 1907 to
ISM he received $10,600 a year. From Ml
to three months ago he received $l,0f» as
chairman of the board, but at that date his
salary Was cut in half. He was also nr».-
.ident. without salary, of the Title and
Guarantee Company, a. director of the Fi
delity Development-Company, a director of
the Northern Bank.' and, until last Friday, |
treasurer of the South Shore Traction Com
pany. ■ ; "\ .
Otto Ke!«ey. who has been president or
the *Etna Indemnity Company since March
20. also testified with regard to the disap
pearance- of the entry in. the company's
passbook of the $59,000 deposit in the North
ern Bank, and Daniel X. Gage, vice-presi
dent of the .stna, gave similar testimony,
as did other officials of th a various compa
nies. %
BUILT ON A WRECKED BANK
Northern Followed the Hamilton,
That Failed in 1907.
The Northern Bank of New York was
built on the wreck of the old Hamilton
Bank,, at No. £15 ' West 13th street, that
went to the wall in the panic of 1907. The
main office of the new bank was tha old
office of the Hamilton Bank, and there
were nine branches, as follows: .. >. % •';;? ;
Riverside branch, No. 1 MB Eighth- avenue :
4th street branch. No 74? Broadway; "d
: street branch. No. 254. Eighth avenue, Wash
ington, Heights branch. No. 1707 Amsterdam
avenue; Seventh avenue branch. No. 2301
Seventh avenue; Melrose branch. No. 2246
Third avenue: Port Morris branch. No. 412
East 13£ th street; Tremont branch. No. M
East.-Tremont avenue; Wllliamsbridge
branch. No. 3513 Williamsbrldge Road. .
The old Northern Bank of New York had
Its offices at Broadway and 4th street, and
the new combination, formed on May l,
1903, consisted of a merger of the Northern,
the Riverside Bank, at BJH street and
Eighth avenue, and the Hamilton Bank.
The statement at the time said that the
merger was effected to give the depositors
the benefit of the resources of the three in
stitutions; The figures made public at the
time gave the following resources for the j
three Institutions:
Northern Bank, capital and surplus. $5-JO,OOO
Deposits l -. ■■ ■ ■-, „.
Riverside Bank, capital and surplus. 200.000
Deposits 1.400 000
Hamilton Bank, capital and surplus. 300.000
Deposits 4.000,000
Th« Hamilton Bank closed its doors on
!865
C. C. Shayne & Co.
Manufacturers and Importers of
Strictly Reliable Furs
Offer a
superb line of Coats in Chinchilla, Ermine,
Mink. Seal, Broadtail, Persian Lamb. Astra*
chan, &c.
Also
Neckwear and Muffs
of Russian and Hudson Bay Sable. Chinchilla.
Mink. Fox, Ermine, Lynx, Natural .
Raccoon, Opossum, &c.
Children's Furs
A varied assortment of Coats. Muffs. Scarfs
and Carriage Robes.
Furs of All Kinds for Motoring
A large assortment for both men and
women.
«
Robes and Rugs
in £reat variety.
~ — I No. 126 West 42d Street I — -
—I New York. I ' 1
i THE
Baltimore & Ohio
RAILROAD COMPANY «,
AVSOI NTF; THE REMOVAL Or TirETl
Mm Ticket office
FROM 1300 BROADWAY TO "
1490
BROADWAY,
COR. 43D ST..
Times Square.
TELEPHONE. BRYANT 5433.
J. 8 SCOTT. General Eastern Pint*.
ger Agent.
A. J. SMITH. City Passenger Agent, .
E. V. EVERTSEN. Traveling Paisen3«p
Agent.
S. R. FLANAGAN. Ticket Agent
October 23. 1507. and Frank "vVhlte was ap
pointed temporary receiver. E. "R. Tocasu
was president up to vdthln th?e* dayj o*
the suspension, when hs "as succeedad by
William R. Montsomfiry. - ic--r r*= :- ■ ,-■
I a director of the institution.
There was a bis row in Har!;m - .'*s ;. v >
bank closed, as it carried heavy deposits
] from the business men in that s»ct!dn. ahi
th* affairs of the bank came into fcota'th«
; civil and the -criminal court Five ■•■* •-•
rnents aro still pending against-Slontgos:
ery. Three of them- '-hare* fraud t&rCffi&r
in UM first dsgree and MM charge him with
overdrawing a bank account. Montgomery
was the m«ia£«r of Scaring 4 Cc at" th*
time of their failure.
I The officers and directors of the N'ortfcem
■Bank of Htm York, according la its "Dl
rectory of directors for 1310." are as fol
lows: President. Frank L Grant; vfce-prei'i
dents. Henderson M f4f«M Martin McHal*.
i Frederick D. Ive3 and H. H. Blzallica;
I cashier. William L Bro-wer; assistant caalt
llen, William H. ilill3 and I. S. Voorhis.
! directors, William H. Birkmire. George F.
Brown. John J Clancy. Frank L. <sran».
Frederick E. Grant, James M GiSard, An
gustus F. • Holly. Thomas Kelly. Fre«s»4ji
D. Kilburn. MMtti McHale. Edward 31.
?lorsran. Thomas F. Murphy. Ctarlss 'A,
O'Donohue. Leo A. Price. C.-e-orfc- W. r. ;r
kitt. Joseph L. Railing-. Adolph P.i-senb»r».
Joseph G. Rob!n, Jacob C. Simon. Anthcay
Stumpf. James T- "Weed. William P. Young?,
William A. Prendergast and Henderson 11.
Wolfe.
Later information abowed that a number
of ri =»?= men had rettr*3 frea. th? directo
rate of th« bank.
BANK CLERKS TALK STRIKE,
New Union on East Side Seeking
Fewer Hours and More Pay,*
A strike of the clerks 'In t-ver.ty £»«*•
Side banks, according to the *?&-:--
the riewly formed East Side Bank Claris*
Union, is threatened - next__rtrontii if de
mands to be made on their behalf siortl?
after January ■ 1 for higher wages and a
shorter workday are not granted. General
Organizer Weinstein, of the United Hebrew
Trades, said last evening that ons-fourtli
of these clerks •were women.
The demands have been referred to the
executive committee of th*» United Hebrew
Trades for revision and will — be nade
public until the end of this •we**, ast
Weinstein said:
"The demands •will be made shortly after
January 1. when the banks are- all-b usy
winding up their books for the year. Tb«
clerks report for work from 9 to 3 "o'clock
in the morning-, and often h*ve to work
until 10 o'clock at night. I believe the
clerks will not have to strike, as the de
mands are moderate, arc! the clerks who
work in any of th«?e banks know the de
tails like clockwork- If. however, the de
mands are not granted there will be a
strike."
1910

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