The nonpartisan leader. [volume], January 06, 1916, Image 2

About The nonpartisan leader. [volume] (Fargo, N.D.) 1915-1921

Image provided by: State Historical Society of North Dakota

                
TWO
From early in January, 1914, until
some time in October the same year—
over nine months—R. C. Kittel, now
held for the grand jury on a charge
of wrecking the First .National bank
of Casselton, was illegally in posses
sion of $10,000 of the bank's funds,
according to a report of the national
bank examiner at the time.
Directors of the bank knew of this
at least a year ago, and knew the
bank examiners had reported Kittel
made fictitious entries on the books
which concealed the true condition.
Yet Mr. Kittel was al^^ed to re
main president of the b^B^intil No
vember 29, 1915, nearly two years
after the first fictitious entry re
ported was made in connection with
this transaction.
Gag Poticy Observed.
A week after the directors removed
Mr. Kittel as president of the insti
tution the bank was closed and the
comptroller of the currency placed
in charge, the discovery of new and
extensive irregularities by Mr. Kittel
making this necessary, the directors
stated.
Details of Mr. Kittel's former ir
regularities as given in the bank ex
aminer's report are presented to the
pjublic herewith for the first time.
No newspauer described them at the
time they were discovered no news
paper has printed them since the
bank closed. So far a3 the news
papers have let the public know, the
Kittel who was indicted in May,
1915, on four counts for irregularities
dating back to January, 1914, has no
connection with the Kittel now held
to the grand jury for later irregu
larities that caused the bank to be
closed on December 6, 1915.
Directors of the bank have let it
be understood th&t they first knew
of KitteFs irregularities a few days
before" the bank closed. The Leader
has unearthed facts which indicate
it was known by the directors at
least a year fcsfore the bank closed
that Mr. Kittel was illegally manipu
lating the bank's, funds.
The details of Kittel's maniupla*
tions of the bank's funds, ih 191:4, as
found by the examiner, form a chap
ter in "high" finance in the north
west that is astounding, the more so
because Kittel admitted making the
false entries which concealed for a
time the transactions, but made ex
cuses and explanations which seemed,
to satisfy the directors and influenced
them to let him remain at the head
of the institution a year- longer, dur
ing which time he- •. completed the
wrecking -of the bank, according: to
the'new. charges now filed. The ex
aminers reported the following facts:
Early irt January, 1914, Kittel cred
ited R. C. Kittel & Co. with $12,t)00
on the, bank's .books. R. C. Kittel.. &
Co. were one of the numerous com
panies Mr. Kittel ran in. addition to
performing the duties of bank presi
dent. The $12,000 was credited to
the checking account of this Kittel
corporation.
False Entries Stand
To balance this credit to the Kittel
checking account Mr. Kittel charged
On the bank's books against the First
National bank of Fargo the sum of
General News
Berlin reports that Germany has
ample food for a long war and at a
price much below that of her ene
mies.
The alleged strained relations be
tween the United States and Aus
tria over the sinking of the Ancona
have been relieved.
Henry Ford, a wireless message
from the liner Bergensford says,
will arrive in New York City Satur
day. He is reporte3*to be well.-
A letter from Theodore Roosevelt,
read before the American Sociologi
cal Society at Washington, denounces
THE NONPARTISAN LEADER
Bank Case Exposes Deals In "High" Finance
$12,000. He sent his note to the Fargo
bank for $12,000 for deposit and
credit to the Casselton bank. The
note was never accepted as a deposit
of $12,000 by the Fargo bank and no
credit of $12,000 was made in the
Fargo bank in favor of the Cassel
ton bank. Mr. Kittel's note was
promptly returned., to him.
As the transaction now stood R. C.
Kittel & Co. was credited in the Cas
:elton bank with $12,000, but there
was no real charge against the Fargo
bank to balance it, although the entry
of a fictitious charge against the
Fargo bank was allowed to remain
in the Casselton bank. Thus the
books remained until early in May,
1914, R. C. Kittel remaining in pos
session of the $12,000 till then, and
the fictitious entry balancing the
transaction standing untouched after
the return of the note which was
supposed to be the basis for the
entry.
Head of Wrecked Casselton Institution Found By Exam
iners To Have Manipulated Funds as far Back as 19(4
Allowed by Directors To Hold Job Till Transactions
Dissipate People's Savings.
Now comes the second, series of
fictitious entries, which kept the
money he was not entitled to in Kit
tel's hands for a few months longer.
Makes More Entries
Early in May Kittel wipfd out the
fictitious -charge of $12,000 against
the Fargo bank. He cancelled it
with $2,000 cash and another false
entry of $10,000, this time made as
a charge of $10,000 in the Casselton
bank against the National City bank
of Chicago. The money which in
January, 1914, Kittel put in his
checking account without any secur
ity or proper charge balancing it
was now charged again
:t the Chicago
bank, instead of the Fargo bank, al
though the charge was purely ficti
tions, because no credit to the Cas
selton bank existed, on the Chicago
bank's books.
This was the state of the books
oil" June 30, 1914. The comptroller
of the -currency asked Mr. Kittel for
a statement of the condition of the
Casselton bank as of that date. On
July 7, 1914, Mr. Kittel reported to
the comptroller of the currency in
response to that call, and he reported
the false charge against the Chicago
bank. This report made it appear
that the National City bank of Chi
cago owed the Casselton bank $13,
178.12, when as a matter of fact the
Chicago bank owed the Casselton
bank only $3,178.12, the extra $10,
000 reported, as owing the Casselton
bank being the fictitious entry made
in .May above referred to.
Stood Nine Months
Mr. Kittel allowed the books to re
main in the sharr2 reported to the
comptroller until some time in Oc
tobsr, 1914. Thus he was in posses
sion of the large sum of money con
cerned in the fictitious entries for
over nine months. In October, 1914,
cash was actually deposited in the
Chicago bank to make a basis for
the fictitious entries which had ex
isted, since January, 1914.
The deposit in the Chicago bank
all pacifists as "slothful, soft and
wicked."
Latest reports have it that dne
third of the Ford psace party will
desert the expedition. The rest will
go to the Hague.
Warden Thomas Mott Osborne of
Sing Sing prison, New York, has
been indicted by the Winchester
grand jury on charges of misman
agement, including immorality and,
purjury.
The British cabinet is. in a critical
condition, over the issue of conscrip
tion. Those members favoring con
scription promi:e to excuse married
men. It is claimed there, are 650,000
eligible single men subject to forced.
which finally wiped out the fictitious
entries was made by a firm of brok
ers there through which Kittel had
disposed of an issue of bonds of an
other ope of his companies, the Al
falfa Valley Land company. Bonds
of this company of $100,000 par value
were sold, for $90,000 and the money
deposited in the Chicago bank.
Land Company Appears
The Alfalfa Valley Land company
owns land in McHenry county, N. D.,
as does the Northern Trading com
pany, still another Kittel corporation.
It was the dealings of Kittel through
the Casselton bank in pappr of this
last named company that finally
caused, the bank to close, according
to statements the directors have
made. Two other Kittel firms or cor
porations have been mentioned in
various connections since the -bank
closed. They are the Casseiton
Realty company and R. C. Kittel &
Bro., but R. C. Kittel & Co., the
Alfalfa Valley Land company and the
Northern Trading company are the
only ones which have appeared, in
connection with any of the "irregu
larities charged against .Kittel.
The story of Kittel's excuses and
explanations of the false entries of
1914, which he admitted having made,
and of his trial and acquittal by
the fury of criminal liability and in
tent in connection with them ma
another interesting chapter.
"Explains'' Entries
Kittel's explanation was that. ito
the first place the entry of the credifs
to R. C. Kittel & Co. and the charged
against the Fargo bank were made*
in good faith, as he expected the
note of $12,000 sent to the Fargo
bank to be accepted and credited to
the amount of $12,000 to the Cassel
ton bank. After the- note was,
promptly returned, ar»dt^i
made at the Fargo bank tCi£Ce
cuse for letting the entry of "tBe
false charge stand was. that ft was
an oversight—that he had forgotten
or unintentionally neglected to make
the necessary new entries at the Cas
selton bank on the return of the un
accepted note.
The explanation of the May trans
action, when the false charge was
transferred from against the Fargo
bank to against the Chicago bank,
was that Kittel had instructed the
brokerage firm in Chicago to. .make
the $10,000 deposit in the Chicago
bank and that he did not know the
deposit had not been made. He tried
to show- his good faith and the ab
sence of -any crookedness by the fact
that the deposit was actually made
in October, nearly six months after
the entry had been made and over
nine months- since-Kittel started.to.
get the use of the large sum.of money
concerned.
Indictments Returned.'
The Kittel indictment by the grand
jury on these transactions of 1914 was
on four counts—two for making the
false entries on the bank's books and
service, if the rule is adopted.
Congressman Frank Buckhanan,
former Congressman H. Robert Fow*
ler, Henry B. Martin and Herman
Schulteis, New York, have been in
dicted charged with violation of. the
anti-trust act by interfering with
foreign trade in munitions of war.
An explosion wrecked four bulid
in.gs in Los Angeles during the New
Year's festivities. Joeph Rossina
and his-wife, residing in the rear of
of one of the structures are missing.
The cause of the explosion has not
been learned.
A report of the Standard Oil com
pany shows that its wealth has
trebled in value since the dissolution
of the combination by the federal
two for reporting the entries to the
comptroller a& "true and legitimate
entries. The minimum penalty, if
criminal intention was shown and
proved to the jury, was five years.
The jury either accepted Kittel's
explanations as compiletely clearing
up the matter, or, since nobody was
injured ultimately by the transac
tions, it hesitated to give a verdict
which would, send Kittel to the peni
tentiary for five years. Both these
explanations were made after the
trial. But the fact remains that the
jury found him not guilty on the
four counts, setting him free entire
ly, and he returned to his active
duties as president of the bank.
The acquittal was on July 2, 1915,
and on December 6, 1915, a few days
over five months later, the bank was
closed", Kittel being arrested, and
charged with as dastardly a case of
bank wrecking as has taken place
in the northwest in recent years.
The bank suspension has hit to a
greater extent than in most cases of
the kind the small depositor, least
able to stand it. Practically every
loser is a'farmer, a farm hand, a
school teacher or clerk with all his
or her savings of a life time in the
bank.
Grand Jury Called
A special federal grand jury has
been called to ..meet in Fargo Janu
ary 11 and hear the charges against
R. C. Kittel and his brother, W. F.
Kittel, the latter formerly cashier of
the closed, bank and charged jointly
with R. C. Kittel with" bank wreck
through embezzlement and falsi
fying records. Both waived hearing
before the United States commission
er and their cases will go direct to
the grand jury. Following indictment
by the grand jury the'Kittels will be
tried, likely at the January term of
court.
Both men are out on bonds, that,
of R. C. Kittel being $10,000 and:
thai of Ha ^brothwr $6,000.
Personnel of Jury-'
Personnel of the
Him 'will Hear the, ea*e
lows:
tiewis Johnson, Barrie, Richland.
K. H. Kane, Mohall, Renville.
C. A. Johnstone, Ashley, _McIntosh
F. H. Miller, Hurdsfield, Wells.
William Dunnell, Minto, Ward.
P. J. Meyer, Bismarck, Burleigh,
j. B. &eed, Minot, Ward.
'•'Charles'M. Page, Fargo, Cass. *.
Eugene Van Horn, Minnewaiikan
Benson.
H. J. Fritz, Wilton, McLean.
David, Kirk, Niagara, Grand Forks.
Henry Chalmers, Balbon, Steele.
Charles Gad, Flaxton, Burke.
George Hager, Minot,-Ward.
C. A. McKenney, Williston, Williams
Lewis Allen, Jamestown, Stut men.
P. S. Chaffee, Eqa-s}r-\ Mc-icr.-.
E. Garvin, Grand Fo: Iw, ui.srvl
Forks.
H. L. Henkc, f'nr.11 —. !'or'.
Fred Hildrctli, Y/Xi t.:-\ Wi." '~v.
Edward Langton, Pcr..!j i, Pem
bina.
W. E. Stoddard, Mott, Hettinger.
John Murphy, Page, Cass.
Martin Jacobson, Mohall, Renville.
Peter Berg, Englevale, Ransom.
government. Rockefeller's share at
the time of the dissolution was $167,
192,000. ft has increased, now to
$421,000,000.
The proposed rate increase on grain
and grain products from Indiana, Illi
nois and other middle western states,
from certain points in Wisconsin,
Iowa, Missouri and Kentucky to At
latic ports for export were found not
justified by the Interstate Commerce
Commission-.-
Tm
Judge Henry Hudson of the 24th
judicial district, Pawhuska, Oklahoma,
handed down a decision, last week,
holding that all Osage Indians were
full citizens of the United, States,
and as such were, entitled to all the
rights, privileges and immunities', "V
There are 229 00 male Osages.