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Acted Office Chamberlain's Quickly Last January. J. A. YOUNG TO GRAND JURY P. S. C. Looking Into Robin's South Shore Traction Company Collateral. The day the Carnegie Trust Company closed its doors, January 7. 1911. was day of excitement and apprehension in the City Chamberlain's office. Mr. Hyde himself was away in the Florida Everglades at the time and to Deputy Chamberlain Walsh fell the responsibility of safeguarding city deposits. To draw all city money out of those banks having Cummins loans-and what banks they were was known, apparently. at the City Chamberlain's office-was considered too radical a step. An emissary went scurrying about, however, it was learned yesterday. calling upon these banks to file larger bonds or in some other way to strengthen the security for these deposits, under pain of losing them. Some of the banks told him to take his money and others acceded to his wishes. Withdrawals were made in a number of cases. The Hungarlan-American Bank. which had lent Cummins $100,000. a debt which has since been wiped out. secured $100,000 of its $125,000 city deposit with railroad bonds and allowed the Chamberlain to withdraw $25,000. The Madison Trust Company, one of the three banks in the Carnegie Trust string. gave up all its city money. $275,000. which was withdrawn in two checks, one for $100,000 and the other for $175,000. Two days later this money. which in the mean time had been reposing in the vaults of the National City Bank. was deposited in the Equitable Trust Company. Others Relinquished Deposits. The Nineteenth Ward Bank. another of the banks controlled by the Carnegie Trust Company. lost its total city deposit of $125,000. The National Reserve and the Publie Bank relinquished all their city money. po-$250,000 and $25,000. respectively. The Savoy Trust Company. on the other hand. secured $100,000 of its city money with surety bonds and gave up only $30,000. while from the Mercantile National $150,000 was withdrawn. All these moneys, it is understood, were deposited for the time being in the National City Bank John Alvin Young. brother-in-law of Madame Nordica and former president of the Windsor Trust Company and a former director of the Hungarian-American Bank. in testified before the grand jury yesterday corroboration of what W. E. Holloway has already said-that a certain deposit, source unknown, was promised the HungarianAmerican for loan to Cummins, and that the same day the bank lent Cummins $100,000 it received city deposit of $125,000 Arthur Watson. cashier of the institution. gave evidence to the same effect on Tueslay Mr. Young. however. denied that he had gone to Hyde in behalf of the Hungarian-American Bank, but he did call upon the City Chamberlain, he said, to solicit outright a city deposit for the Windor Trust Company. The question of the validity of $190,000 of South Shore Traction 5 per cent first mortgage bonds held by the Carnegie Trust Company has been raised by the Public Service Commission These bonds the trust company held as collateral against certain $230.notes of Joseph G. Robin aggregating 000. With other collateral to secure the notes, they were sold at auction on March 22 by the receiver and bid in by him with the rest for $95,000 The Public Service Commission began its investigation of this bond issue on January 9. There are outstanding $432,000 of these bonds The mortgage securing them was executed in 1904. with the permission of the old Board of Railroad Commissioners and before Robin became interested in South Shore Traction. The company could issue $2,000,000 bonds against it. Question of Authority. But it did not avail itself of this privilege until June 28, 1907. In the mean time, on June 6. 1907. the Legislature had passed the Public Service commissions law. The commissions were not actually appointed, however. and the law did not become fully operative, therefore. until July 1. Between the passage of the law and the appoint= ment of the commissions the South Shore Traction Company authorized the issue of $32,000 of its bonds, the Empire Trust Company being trustée under the mortgage The question is-are the bonds illegal because their issue had not the sanction of the Public Service Commission? An overissue of three thousand shares of South Shore Traction stock, much of which was held as collateral by banks and trust companies, was another transaction which engaged the commission's attention for a time. That has been patched up, however, due to the pressure brought to bear on Robin by the Columbia Trust Company, register of the stock. and the Public Service Commission. But what the depositors of the Carnegie Trust Company are more interested in is the appraisal of the Carnegie Safe Deposit vaults at $200,000. The trust company onns or holds 49 per cent of the stock of the Carnegie Safe Deposit Company. the other 51 per cent being held by Charles M. Schwab and the estate of C. Dickinson. The vaults were installed in the basement of No. 115 Broadway, the address of the trust company. by the Bethlehem Steel Company. for $600,000, it is said. Steel men say that they could not be duplicated for $750,000. The capital stock of the Safe Deposit Company is only $200,000. however CarDirectly across the street from the negic Safe Deposit Company is the Mercanile Safe Deposit Company. James Hazen Hyde's promotion in the Equitable Life building. It has been pointed out that the Equitable Building is to be torn down in he course of year or two. and that posibly the Mercantile may want the Caregie vaults. The Carnegie Safe Deposit Company owes the trust company $400,000 n loans. Incidentally the low appraisal of the Trust furniture and fixtures of the Carnegie Company, $15,000. has been source of surprise to those who know that they cost originally $113,000. The trust company's banking rooms are infested now with fur. future dealers looking for bargains. Reichmann Not Worried. Friends of Joseph B. Reichmann, forner president of the Carnegie Trust Comany. say that he is not worrying a little it over his indictment for a misdemeanor They explain the transaction which caused is indictment on the charge of signing a the condition of the
