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RUN ON BANK BRINGS CLOSE TEMPORARILY (Continued from Page One) ed States, closed in New York was al state institution, Rep. MeFadden, (R), of Pennsylvania, chairman of the house banking committee, today said that under 4 law passed in 1926 no state bank or trust company can use the words federal or United States in its name. The law, however, was not made retroactive and the Bank of United States continued to use its name.
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RUN CLOSES BANK NEW YORK Dec. 11.-(UP)The state superintendent of banks Joseph A. Broderick today took possession of the Bank of United States, an institution which had deposits of $202,972,000. There are 59 branches in New York city. Heavy withdrawals were reported last night at thirteen branches in the Bronx and Brooklyn
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STATE TO PROBE REDS' ACTIVITIES IN BANK CRASHES Fraud Bureau and Banking Dept. Keep Close Watch on Communists Here. Two State the Bank ing Departme Fraud reau of Attorney General's fice. are watch to. day activities of Communists officially held responsible measure for the of two the first of month. attempted attack on third which checked after had been started. Strong on the of the Department discovery the third plot revealed today by an official of the in ing the run after line of about 1,000 depositors had formed in front on of the branches this bank line the depositors fears Banking Department official learned last of Com munist campaign being discussed to launch the attack on this institution Run Checked Within hours this learned. the but it quickly nothing regarding learned by the general With this example them coupled the runs on the Bank of United and the naBk & Trust officials are convinced of strong to one bank with faiding the munist world revolution against capitalism and all its instiWatson Washburn assistant At. torney General charge bureau. questioned heads eight brokerage houses and their records. out for other and relating to deals in bank time in pressing charges against brokers whom find had slightest connection whispering and against he said He question 100 brokers about Chelsea Bank trading. learned today that District Attorney of New County also taking an interest in the To Probe Red Activities Assistant Attorney Charles Pilatsky has directed look into activities of Communist to foundation for that the Reds are plotting against the and he has quietly tracing calls depositors bank to withdraw their Broderick of the banking questioned garding reported run on the third Institution run there was that one being ed. by to thousands of depositors another two or three days, the said, he would be in position to make complete statement the conditions of the bank He 80 far he knew no tion was done the of the Bank of "nited States He denied he had issued that the Chelsea bank were assured of 100 on the dollar He had not discussed this phase he and would no on until his was to tonight Girls Commercial H. 883 Classon to discuss Max D. Steuer. chief counsel for the Depositors tion. is to make revelations startling made to broadcast his remarks
FALSE REPORTS Caused Bank Failure, Is Statement Of Federal Reserve With Regard To Run On Bank Of United States December 31 met the for the is the as in week 13 the ripto This the closing of of almost by from of heavily to be for prepared the service which Federal to render. The curdue in apprehension paralleled several
BOND HOUSE SUSPENDS. New York, December 31-(AP)The Equitable Casualty & Surety Co., with connections in 31 states. was placed in the hands of the State Insurance Department by Court order today. Thomas F. Behan, Acting Su perintendent of Insurance, stated that the $650,000 capital stock of the company had been impaired to the extent of $588,836.31 Company officials disputed the figures, but ad mitted the surplus had been wiped out. Harold Speilberg, Chairman of the company's executive and finance department, attributed the company's difficulties mainly to failure of the Bank of United States, in which it had large holdings.
ANOTHER BANK (Continued from First Page) blame the closing of the bank On Monday night the officials the arrest two depositors for "spreading false rumors did prove false this morning when positors branch alone tried their money. order to try stop the run the bank Broderick issued which he said. plenty of money satisfy This proved lie. There was plenty money the depositors wait 400,00 Bank of are waiting. Examiner Peddles Lies The fact that the run the bank continued after Broderick's shows that the people are losing faith the of when come question of the money this $25,000,000 bank within weeks after the of the Bank the heart the financial center United States shows the of the crisis and effects the banking There already been 1100 bank failures 1930, with assets 700 million dolinvolved. This exceeds ords the history of the United States. Depositors Total The total number of depositors New bank fail and with families they represent more Run Started by Rum Seizure reliably that the closing the was by the recent capture officials several large cargoes of liquor, the which been financed by the bank officials. TEN MORE IN THE SOUTH Memphis, Tenn., Dec. banks eleven northeast Mississippi towns were closed today. All were within dius of about 30 miles the and uation described local president Peoples Bank Trust Company, Tupelo, the largest of the
Affairs of New York Bank "Scrambled." NEW YORK, Jan. 2—(AP) The intermingled financial affairs of four subsidiary corporations of the closed Bank of United States were described today as a "corporation omelet" at a bankruptcy hearing on the affairs of the corporations. Carl J. Austrian, representative at the hearings for Joseph E. Broderick, state superintendent of banks who closed the institution last Dec. 11, offered this comment on the situation after Saul Singer, vice-president and chairman of the bank's executive committee, testified on the financial structure of the four companies. Singer declared all four were solvent. The subsidiaries, which went into bankruptcy last Wednesday, are the Bankus Corporation of New York, the City Financial Corporation, the Municipal Financial Corporation and the Delaware Bankus Corporation. After long and involved testimony, counsel for the receiver asked Singer, "If a man had 100 shares of City Financial he then received 56 units, each unit made up of one share of Bankus Corporation and one share of Bank of United States. Is that right?" "Yes, that's right," the witness replied. In response to a question as to how much had been raised for the corporations from the public, Singer said $33,500,000 had been raised and then an additional $14,700,000 had been borrowed, making a total of $48,200,000. Mississippi Banks Close. JACKSON, Miss., Jan. 2—(AP) Withdrawals by depositors today was given as the reason for the closing of five Mississippi banks taken over by state and Federal departments. The closed banks were the First National Bank of Pontotoc, with deposits of $600,000 and capital stock of $125,000; Bank of Pontotoc, deposits $534,000 and capital stock $100,000; Citizens' Bank at Winona, deposits $260,000 and capital $25,000; Bank of Blue Mountain with deposits of $179,000 and capital $10,000; Bank of Derma with deposits of $50,000 and $10,000 capital. Arkansas Banks Reopen. LITTLE ROCK, Ark., Jan. 2—(AP) State Banking Commissioner Walter E. Taylor announced the reopening of three banks today. Those reopening are: The Eudora Bank as successor to the closed Eudora Bank and Trust Company at Eudora; the Bank of Salem at Salem and the Farmers' Bank at Casa. Alabama Bank Closed. MONTGOMERY, Ala., Jan. 2—(AP) Dent F. Green, state superintendent of banks, announced late today the People's Bank of Gilbertown had closed. Capital stock was listed at $15,000 with a surplus of $3000. Deposits on Nov. 20, 1930, were $61,880.
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# Red Sparks By JORGE # Junior's Education Junior: Who's Henry Epstein, pa?-Pa: I don't know. Why? Junior: I see the N. Y. Times says he has been appointed First Assistant Attorney General of the State of New York.-Pa: Well, what of it? Junior: Nothin', pa. But, pa, ain't the Attorney General supposed to prosecute any crooks that took the money of small depositors in banks they run?-Pa: Sure. But what's that to do with Epstein? Junior: Nothin', pa. But ain't there a lawyer by the name of Max D. Steuer who is attorney for some depositors in the Bank of United States?-Pa: Yep, and he's making a big row. Says that millions of dollars are missing. Junior: Uh nun. But, pa. How does it happen that this lawyer Steuer is attorney for depositors who lost their money in one Tammany bank, and is also attorney for the former State Superintendent of Banks who got bribed to allow the swindle of depositors in another Tammany bank?-Pa: H-m-m. Seems a little queer. But lawyers take cases of anybody who pays them for it. But what's that go to do with the Epstein chap? Junior: Nothin', pa. But I was just wonderin', 'cause I see that this Epstein is the son-in-law of Steuer. Do you suppose that Tammany has appointed Steuer's son-in-law to prosecute crooked Tammany bankers that Steuer is defending?-Pa: What? You repeating Red Rumors! Never let me hear you impugning the uprightness of leading citizens again! Nor the scrupulous honesty of bankers and banking superintendents!
CHARGE BANK'S RECORDS FALSE CALIFORNIA BEFORE CLOSING AND PACIFIC Directors Are Witnesses FARES TO FIT at Investigation. New York, Jan. cers of the closed Bank of United States concealed the condition of the bank when was near collapse, it brought out at the opening of an One way fare Chicago today. joint state to California or Pacific and county into inquiry the bank's Northwest. Good in suspension is being directed by Attorcomfortable coaches ney Max D. Steuer, who will present chair cars only. his evidence to the grand jury. pointed also to the facts that the bank's books had been falsi$6500 loans had been made without the or approval of the board of and that the One way fare Chicago to minutes of California or Pacific board had since Dec. 12, 1929, Northwest. Good in 33 Witnesses Called. witnesses were Julius Blauner, director of the bank, and Robert director and vice president. They were first the of 33 witnesses, to include other officers and directors of the bank, subpoenaed. Mr. Steuer's Mr. of Blauner Mr. Adamson revealed that on Sept. ten weeks before the bank was closed and taken over by the state banking department, the bank reported in its regular quarterly statement to the epartment that it had surplus of $10,000,000 $7.and in profits, contrary to the findings of examiners of the state banking department, who found not penny in the bank's treasury under these items. Loan Made to Kresel. It was also brought out by Mr. Steuer that $16,000,000 in loans were granted to the bank's affiliates with- out knowledge or approval of the directors and that a total of $4,510,217 in loans and accumulation indorsements granted to directors of the bank without official knowledge of the board. these loans one was of to Isidor J. Kresel, ney and director of the bank and cial counsel in the appellate division's inquiry into magistrates' courts. Mr. Kresel put up collateral of $190,111. Bernard M. Marcus, president, and Mr. Kresel, it was brought out, virtually ran the bank, with the majority of the directors kept in ignorance for the most part of matters with which they are required to be familiar under the One of the outstanding revelations before Steuer was that while Mr. Marcus had reported to the board of directors that the total of what might be termed weak loans was not above $600 or reports of state examiners, produced by Steuer to the surprise of both Mr. Blauner and Mr. Adamson, showed that of loans amounting to $37,498,290. the bank. ing department had criticized as quiring watching and had characterized $14,065,366 as "slow and $9,321,088 as doubtful.
DIRECTOR ARRESTED NEW YORK Brownstone director and ber of the executive of the closed Bank of United Monday when he to at an tion affairs wheth he had personal brokerage on margin declared that "a personal question he owed $650 to the bank and 00 to two of its bankrupt
INVESTIGATOR Of Judges Arraigned At New York With Seven Bank of United States OfficialsKresel's Bond $10,000 February Kresel of in York Courts answered charging today The signed last as investigator of the arose from Bank of United not guilty to charges resulting suspension but Kresel faced the ordeal of and the he displayed in the Magistrates pigeons Only when Allen shattering all of the reached hand and him how he did Kresel betray his Kresel five held for $10,000 bond the of Bernard Marcus President and Saul Singer Vice the bond was set at Through his attorney, John Kresel issued statement for the confidence of the and his "brethren at the bar He declared his innocence and his belief he would be vindicated Samuel Rosoff. subway contractor submitted to Banking Superintendent Broderick plan for reorganizing the closed bank Under this plan would reopen under new name with $10,000,000 new capital The closed bank has no connection with the Government
Milton, lawyer and of John D. Rockefeller, Jr., and H. Satteranother planned to sent to the state banking plan for reopening the bank The plan conceived by Samuel Rosoff, millionaire subway The closed bank has no connection with the government.
HEAVY BONDS SET IN BANK OF U. S. CASE Marcus and Singer Held in $100,000 Each, But Kresel Bail Is Only $10,000 $50,000,000 SUIT STARTED Brought Against Bankus Corporation Directors; Move to Reopen Bank Made of corruption in York courts. today indictment charging felony in General Sessions Court. The resigned last night investigator of the magistrates arose from and seven other in the Bank of United States not guilty to charges the bank the ordeal of finger and with the displayed penetrating the defenses vice-squad and Only Judge shattering all dents the court reached his and him how did Kresel betray his feelings very Kresel and five of his associates held for trial in In of Bernard K. Marcus, Saul Singer vicethe bond Through his John W Kresel issued for the confidence his bar He his and his belief he would be At the arraignment today Crain supported his demand for high bail by declaring that misappropriation of more than was charged. One of the Kresel and two others misapplied Continued on Page Five
ASSERT BANK MADE NOVENA OF GRACE DEPOSITORS DRIVE BEGINS TOMORROW AWARE OF FAILURE AT CHRIST OUR KING Steuer Says Bank of Signed 60,000 Patrons in February. REOPENING IS SOUGHT (By The Associated NEW Mar. that the Bank United marshaled than 60,000 depositors shortly the State Banking Department issued unfavorable report condition stirred the Steuer investigation today. Morris testified yesterday that high officials had instituted drive more depositors in 1930. and that he himself recruited 1,400 from among his in another "This the most startling testimony yet Deputy Attorney General Max Steuer who delving into the reasons for the Attorney General John H Bennett announced that several directors had started independent movement to recompense depositors 100 cents dollar. either by tive liquidation by reorganization and reopening of the bank.
BANK SOLICITED DEPOSITS AFTER ADVERSE REPORT NEW YORK. March 3. Testimony that Bank of United States marshaled more than 60,000 depositors shortly after the banking issued report on its condition stirred the Steuer investigation today. Morris White, director. testified yesterday that high officials had instituted drive more depositors in 1930 and that he self had 1,400 from among his the most startling testimony said Deputy torney General Max D. who is delving into the reasons for the Atty. Gen. H. Bennett Jr. announced that an movement to recompense depositor 100 cents on the dollar, either by constructive liquidation or by reorganization and reopening of the bank
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CASE SET FOR TRIAL NEW YORK, Mar. 24. (AP)-Trial of Issidor Kresal, Bernard Marcus. Saul Singer, Herbert Singer and Henry Pollock, directors of the defunct Bank of United States, was ordered to start March 30.
TUTTLE PLEA FOR MISTRIAL IN BANK CASE IS REJECTED the York Bureau NEW YORK April -Charles H Tuttle of for the defense of the four officials of the closed Bank United States being tried in the Court of General Sessions for alleged misuse of the bank's funds demanded A the cause made by Max D. the special to of The court denied the motion
DEFENSE CLOSES CASE IN BANK OF U. S. TRIAL From York Bureau the NEW YORK, June defense attorneys for the four officials of the closed Bank of United States on trial for alleged wilful misuse of the bank's funds, rested their case yesterday. There will be brief rebuttal today which both sides will with to the jury
Corn Exchange Bank To Open New Branch The Corn Exchange Bank Trust Company today announced will open its Colonial branch Columbus Ave. 81st St., Manhattan next Monday George 8. Carr will be in charge of the office This was formerly branch of the Bank of United States was sold to Corn Exchange by the Raw Silk Futures State Banking Department in liquidating the closed institution Prices York Exchange Before merged by the Bank High Last of United States it was the Colonial 2.25 2.25 2.25 2.27 Mr Carr was vice president of the Colonial and 2.24 vice president of the Bank of United 2.24 2.24 2.24 2.25 States
PLAN OF BANK OF UNITED STATES New York, Aug. for the of the closed Bank of United States will be announced within ten days or two weeks, the Associated Press learned from reliable sources yesterday. While details of the plan could not be learned, was understood that Arthur W. Little, former director of the Bank of United States, would be chairman of the board of the new The Bank of United States was closed by the state banking department on Dec. 11. 1930. It has no connection with the federal government.
Bank of U. S. to Pay Second Dividend NEW YORK, Dec. -Supreme Court Justice Washas approved an order the second dividend of 15 per cent to depositors in Bank of United States and other creditors.
ROOSEVELT COURT WITNESS Gives Testimony at Trial of Broderick in Failure of Bank New York, April 20. (AP) Governor Franklin Roosevelt testified today as defense witness in the trial of Joseph Broderick, state superintendent of banks. Broderick is charged with neglect of duty in failing to close the bank of United States earlier than he did. The session was marked by quent and heated arguments counsel. At one point, when the governor asked permission to ask question of Judge George Donnellan. presiding the trial. Max Steuer, special prosecutor, replied. no, It is absolutely improper to deliver lecture form question to fritter the peoples Steuers constant objections put to the governor Martin counsel, succeeded in limiting the virtually to statement that he knew of and participated efforts to merge the Bank of United States with coupled with of Brodericks as "none higher in the state of New York." There were two separate merger plans the testified Steuer limited his testimony preclude his telling details of the proposed mergers.
Judge Donnellan offered to excuse the jury while the governor asked the question, if Steuer wished that. The prosecutor refused, and said if Judge Donnellan wished to exclude the jury that would be a different matter. The flurry ended by Martin Conboy, defense counsel, resuming his questioning. Steuer refused to cross-examine the governor at the conclusion of his direct testimony, and Governor Roosevelt was excused. Steuer's constant objections to questions put to the governor by Conboy succeeded in limiting the governor's testimony virtually to the statement that he knew of and participated in efforts to merge the Bank of United States with stronger institutions, coupled with an endorsement of Broderick's reputation as "none higher in the state of New York." Broderick is on trial for alleged neglect of duty in failing to close the Bank of United States before he did.
ROOSEVELT TAKES PART OF BLAME IN BANK CASE NEW YORK, April Franklin D. Roosevelt defense witness in the trial Joseph state superintendent of banks, assumed partial responsibility for delay in closing the Bank of United States. Broderick is trial for alleged of duty in failing to close the bank earlier than he
Conviction of Bank Officers Is Upheld NEW YORK, May appeliate division the supreme court today upheld the conviction of Bernard Marcus, president of the closed Bank of United States: Singer, executive dent, Singer's son, Herbert. officer in some the bank's affillates, charges funds the Safe Deposit company, subsidiary the bank. The Bank of United States. with closed 11,