15551. Carnegie Trust Company (New York, NY)

Bank Information

Episode Type: Run → Suspension → Closure
Bank Type: trust company
Start Date: October 1, 1907*
Location: New York, New York (40.714, -74.006)

Metadata

Model: gpt-5-mini
Short Digest: 24b69343

Response Measures

Borrowed from banks or large institutions, Capital injected, Full suspension

Other: Assistance arranged via loans of United States Steel bonds from Andrew Carnegie (pledged to intermediaries) during 1907 panic and again 1910; later institution suspended in 1911 amid revelations of fraud and mismanagement.

Description

The Carnegie Trust Company experienced heavy withdrawals during the Panic of 1907 (articles describe runs and emergency loans from Carnegie/Morgan/Schwab). The institution later suspended/closed (reports in January 1911 state the company closed/suspended business amid revelations of improper loans and alleged theft). Thus sequence: run (1907) → eventual suspension/closure (1911). Cause attribution: 1907 run driven by macro panic; 1911 suspension/closure driven by bank-specific adverse information (mismanagement/fraud).

Events (3)

1. October 1, 1907* Run

Cause: Macro News
Cause Details: Heavy withdrawals and runs during the nationwide Panic of 1907 following failures such as Knickerbocker Trust; institution required emergency assistance (loans of U.S. Steel bonds from Carnegie/Morgan/Schwab).
Measures: Directors sought emergency assistance from Andrew Carnegie and other financiers; received loans in form of United States Steel bonds which were used as collateral to obtain cash and keep the doors open.
Newspaper Excerpt: During the 1907 panic the Carnegie Trust Company, with other institutions, was called upon to pay heavy withdrawals
Source: newspapers

2. January 7, 1911 Suspension

Cause: Bank Specific Adverse Info
Cause Details: Closure/suspension followed revelations of improper loans, alleged misappropriation by officers and other internal malfeasance (e.g., loans to insiders, alleged grand larceny by William J. Cummins), leading to insolvency and suspension.
Newspaper Excerpt: CARNEGIE TRUST COMPANY CLOSED New York Institution, With $8,900,000 Deposits, Suspends Business.
Source: newspapers

3. * Other

Newspaper Excerpt: Articles recount loans from Andrew Carnegie (1907 and Jan 1910) secured by U.S. Steel bonds and later disputes over those transactions and collateral; trial and conviction of William J. Cummins for theft tied to the institution's collapse in later reporting.
Source: newspapers

Newspaper Articles (10)

1. November 8, 1907 Bismarck Daily Tribune Bismarck, ND

Article from Bismarck Daily Tribune, November 8, 1907

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WALL STREET PANIC. Incidents of the Run on Trust Companies In New York. ALL CLASSES REPRESENTED. Venerable Woman's Unpleasant Experience-Reassuring an Anxious Depositor-Some Humorous Incidents Profitable Speculation of Messenger Boys. Wall street has been swarming late ly like a hive of bees when over It was beaten the gong of financial ter ror. Events full of human interest have been witnessed during the runs made by depositors on some of the large trust companies in Ne York. Something of the stress and uncer tainty had been expected in the street and in the early hours of the morning the police moved to their posts and prepared for the reception of the de positors of the Trust Company of America, says the New York Herald. All classes of depositors were repre sented, for the refusal of the banks tc accept checks drawn upon the trust company had made it necessary even for men with substantial accounts to present their checks in person at the window. Large depositors there were in plenty, but for the most part those who stood before the paying teller had comparatively small accounts, running from a few hundred dollars to fifteen or twenty thousand. Of the hundreds who were there not more than half a score of women were seen, and one of these was a detective. One venerable woman who was near the window found to her horror that she had made out her check in pencil. She gave $5 to a man standing near her to take her place while she went to a neighboring desk and wrote her demand with a pen. When she returned her proxy was nowhere to be seen, and she had to go to the end of the line. where she still stood when the gong sounded for the last payment. *She made a final argument, however, and after a four hours' wait succeeded in obtaining her money. One of the largest deposits withdrawn in the course of the day was for $250,000. which was taken away by a young man who placed it in his overcoat pocket and left the place as unconcernedly as though he had collected a gas bill. Soon after 10 o'clock the other morn ing an anxious depositor entered the Carnegie Trust company and buttonholed ex-Secretary Leslie M. Shaw, the president. who was on his way to his private office, says the New York World. "Is the company all right?" demanded the depositor. "Are you sure we're perfectly solvent, Mr. Shaw? "Sound as a rock,"/answered the president. "No trouble within a mile of us." "That's good," said the depositor, a relieved expression appearing on his face. "We can't be too careful of our interests these days, you know, Mr. Shaw. That's why I asked you." The president noticed the man stop at the paying teller's window on his way out, and he wandered over and asked that official, "Is that man a large depositor?" "Let's see," said the paying teller, looking over his desk. "Oh, yes. That's Mr. James Brown. He had a balance of $11.60, and he just drew $8." "On the side lines," among the men who hovered on the outskirts of the long line of anxious depositors the other day, many airy remarks were passed by those whose money was in no jeopardy. A passerby asked the meaning of the crowd before the Trust Company of America's doors in Wall street. "These men want to get their checks cashed," explained a lounger on the side lines. "They ought to know that a bank won't cash checks in these panicky times," announced the passerby. "The place to get checks cashed is a saloon." "Ob L'ue

2. January 30, 1908 The Oskaloosa Herald Oskaloosa, IA

Article from The Oskaloosa Herald, January 30, 1908

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SHAW WOULD NOT BOW TO WEALTH WE ERN WAYS DIDN'T SUIT MULDOONS OF WALL STREET. IS TOO-MUCH LIKE LINCOLN. Fond of Telling Stories And Refuses to be Serious All of The Time. Reviewed By Mr. Curtis. Chicago, Jan. 28 Writing from New York, William E. Curtiss says: "I have asked a number of well-informed financiers what is the matter with Shaw, our esteemed friend from Iowa, Leslie M. Shaw, and with one accord they say that he is a misfit in New York and that is the reason he resigns a distinguished and influential position in financial circles and a salary of $36,000 a year. "He realizes that he has not been successful; he has not quarreled with the controling interests of the Carnegie Trust Company, but they have dissented to his political aspirations and, as you already know, he has resigned, to take effect on the first of March. "When Mr. Shaw left the treasury department at Washington he was elected president of a newly organized trust company named in honor of Andrew Carnegie. Although that gentleman has had no financial interest in the institution and did not subscribe to a share of the stock, it is generally understood that the promoters expected. or at least desired, him to do so. There is a story floating around the street which may or may not be true, that when the "ghost dance" broke out in New York in November, and all the bankers began to fortify and fill their magazines with ammunition, the directors of the Carnegie Trust Company went to the man leir bank was named for to ask for help. But they could not find him. His secretary told them that he was on the ocean. They sent him a wireless message, which, I am told, was effective in securing from Mr. Carnegie's secretary a bunch of gilt-edged securities that were held in reserve in the vaults of the bank in case it became necessary to use them. This was done by Mr. Carnegie for sentimental rather the business reasons. Nobody would want a baby that was named after him to be injured. "The bank sailed through the panic all right without a scratch, although Mr. Shaw spent many an anxious hour. He has not many friends among the other bank presidents. They do not like him; they do not admire his habits and customs, and many of them are very candid in expressing their disproval of what they consider his flippant and trifling manners. Mr. Shaw is a "josher" and a "jollier," and likes to lighten up the ti of his and other

3. February 29, 1908 Coeur D'alene Evening Press Coeur D'alene, ID

Article from Coeur D'alene Evening Press, February 29, 1908

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NEWS, VIEWS AND GOSSIP Doings of People in the Great American City. (By Glenn Guernsey.) NEW YORK, Feb. 29.-When Leslie M. Shaw abandoned his honored and honorable position as secretary of the United States treasury, to cast his lot with the bovines and Teddybears of Wall street, his admirers out in Iowa predicted for him a brilliant future as a financier. Truth to tell, Mr. Shaw has not made good-not, at least, according to the Wall street standard. He has resigned his $36,000-a year job as president of the Carnegie Trust company and will retire tomorrow. Ostensibly this action was due to his desire to become president of the United States. Praiseworthy as is this ambition, the financiers receive this explanation with a grain of salt. Mr. Shaw is by no means a fool, and he probably knows that his chance of landing the plum is about as remote as that of Eugene V. Debs or Emma Goldman. Mr. Shaw apparently realizes that he has not been successful in assimilating the Wall street atmosphere, necessary to the profitable conduct of a great financial institution. This is not to his discredit-rather the reverse. While he has never had an open quarrel with his associates in the management of the trust company, there have been constant differences of opinion. These finally led to the flat-footed proposition that he could either buy out or sell out. He accepted the latter proposition. While Mr. Shaw's Wall street experience has been unsatisfactory to his colleagues, it has not been without profit to himself. His one year's incumbency as president of the Carnegie Trust company has netted a profit of $111,000. Of this sum only $36,000 is salary, the balance representing a bonus on his shares of the trust company's stock, bought at $150 a share and sold back to the controlling interests at $200 a share. It is likely that when the former secretary of the treasury closes up his affairs this afternoon, he will utter a sigh of relief. His financial experience has been a rather strenuous one. While the Carnegie Trust company safely weathered the financial storm that wrecked so many other Wall street craft, the skipper had his moments and hours of anxiety. There is a well defined rumor that at one time during the "recent" panic the trust company was forced to call for help upon Andrew Carnegie. The steel king has no financial interest in the institution, but sentimental reasons led him to respond nobly to the call for assistance. Mr. Shaw supplies another notable example of the man who is able to make a brilliant success of his career in other sections of the country, but who fails lamentably in New York. There are thousands of such failures in New York, brilliant men with enviable records in other cities, men in all walks of life, who find themselves misfits in New York, and yet, like moths dazzled by flame, abandon all hope of wealth and fame for a struggling existence in the metropolis. Mr. Shaw has ex-

4. October 19, 1908 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, October 19, 1908

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Carnegie to the Rescue. United States Steel bonds account, $868,932.50. In the statement of condition of the Carnegie Trust company to the state banking department, under the recent call, appears this entry in the list of liabilities. Its explanation unfolds for the first time an interesting story of the panic of last fall, in which Charles M. Schwab, Judge Parker, and Andrew Carnegie played an interesting part. The story as it was told in banking offices in Wall street yesterday relates how Mr. Carnegie came to the assistance of the trust company which bears his name when runs on the Trust company of America, the Lincoln Trust company, and other concerns occurred following the closing of the Knickerbocker Trust company. It appears that the Carnegie Trust company, in common with many other institutions, was called upon to pay out heavy withdrawals, and when the panic was at its height one demand for a large amount was made by a frightened depositor. The withdrawals had been heavy that day, and when this demand was augmented by several othes it began to look as if the supply of cash would soon be exhausted. Directors were called together, and Leslie M. Shaw, who was then president of the institution, announced he was in favor of closing the bank. Led by C. C. Dickinson, the vice president, who is now the president of the institution, the directors fought off the proposal, and it was determined to send a committee of two to visit Mr. Carnegie to ask his assistance. Accordingly, Mr. Schwab and Judge Parker, who has acted as counsel for the trust company, visited Mr. Carnegie at his home that night, and obtained a loan of $2,000,000 of the United States Steel bonds, which he received at the time of the sale of the Carnegie Steel company to the United States Steel corporation. The next day the Carnegie Trust company received cash from two banking institutions in the Wall street district in a loan made with the bonds as a collateral. Mr. Carnegie made it a stipulation, however, that this loan was to be made to his old friend and ally, Mr. Schwab, and not to the trust company. Bankers unfamiliar with the incident have frequently expressed curiosity as to the reason why the item, "United States Steel bonds account, $868,932.50," appeared in the latest statement of condition of the Carnegie Trust company, issued within a day or two. It is explained that the bonds represent the unpaid part of the assistance obtained during the memorable time last October. Within a few days the Trust Company of America reported that it had liquidated the last of the $25,000,000 loaned to it when it successfully coped with the demands of its depositors who wished their money at once. C. C. Dickinson was disinclined to discuss the matter yesterday. He said, however that the loan could be liquidated at any time, and that it represented assistance given by a prominent "capitalist" to strengthen other institutions, and that the Carnegie Trust company was the medium through which the assistance was extended.New York Herald.

5. January 7, 1911 The Washington Times Washington, DC

Article from The Washington Times, January 7, 1911

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CARNEGIE TRUST COMPANY CLOSED New York Institution, With $8,900,000 Deposits, Suspends Business. (Continued from First Page.) tion of the company under the presidency of Dickinson, with Charles W. Chapman, a curb broker, who acted for ellborn. The present officers and directors were exonerated. About two years ago, It developed, Wellborn conceived the idea of making some money by organizing the Titusville and Northern railroad. Among the first steps he took was to issue $500,000 in 6 per cent gold bonds in the name of his new concern. In the spring of 1909 Wellborn was introduced to Chapman by C. M. Sexton, who represented himself as Wellborn's financial agent. Sexton painted a brilliant picture of the large amount of money to be made out of Wellborn's scheme. The ultimate purpose, Sexton and Wellborn claimed, was to connect all the coal-carrying roads in Pennsylvania into a single system, with the Titusville and Northern as the main artery. Borrowing Begins. Shortly after the launching of the paper railroad, Chapman began to borrow money from the Carnegie Trust Company through President Dickinson. until the amount grew to nearly $70,000. Then he was compelled, Chapman declares, to consolidate the various loans into one note and to back this note with collateral of the face value of several hundred dollars. Reichmann, when he assumed control, learned of these operations. He made Chapman secure his loans with all the collateral he could command, and when he failed to meet the note at maturity brought suit against him. Wellborn has been well known in New York financial circles, and, in fact, all over the country, for eighteen years. He has admitted the he was in the "Kings county penitentiary for eighteen months, in 1905, for an attempt to swindle a widow in Alabama, by mail. Morgan's Aid Asked. During the 1907 pante, the Carnegie Trust Company, with other institutions, was called upon to pay heavy withdrawals, and the supply of cash was running short. Shaw, who was then president, favored closing the institution, but he was opposed by the other officials and the directors. It was finally determined to send a committee to visit J. P. Morgan and ask his assistance. The desperate situation was explained to him and he consented to loan $2,000.000 in United States Steel bonds. This enabled the trust company to weather the storm, and the doors were kept open throughout the panic. Charles Coulter Dickinson, the company's organizer, died in St. Luke's Hospital last May under circumstances which led to an extended investigation. His relatives claimed that his death was caused by injuries he sustained when he fell off his horse in Central park. An accident insurance company in which he had large policies, took up the probe. It developed that some time before he had attended a chemical test in Pennsylvania, and it was said that he died from the effect of poisonous fumes he inhaled there, while watching experiments that he expected to result in the transmutation of baser metals into silver. Ends His Connection. Reichmann ended his connection with the Carnegie Trust Company some months ago. He was succeeded by J. T. Howell, formerly president of the Fourth National Bank of Nashville, Tenn., and he is the present head of the institution. Joseph G. Robin, the young bank juggler, was at one time a director of the Carnegie Trust Company, but his recent financial operations are believed to have had nothing to do with the closing of the institution. The city of New York had $650,000 on deposit in the Carnegie Trust Company. The money was deposited by Chamberlain Hyde, who is missing. Last week there was $700,000 to the city's credit in the institution. According to Deputy City Chamberlain Walsh, the city is fully protected by bonds of the bank officials. More than $11,000,000 is involved in the closing of the trust company, the last report of the institution to the State banking department, on November 10. 1910, showing total assets of $11.170,600. The Carnegie Trust Company was a depository of the New York Cotton Exchange, but it is said it had not received a large percentage of the business of the exchange lately.

6. January 19, 1911 The Mathews Journal Mathews, VA

Article from The Mathews Journal, January 19, 1911

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Company as a financial institation shown by the fact that Leslie M. Shaw was at one time president of the company. During the 1907 panic the Carnegie Trust Company, with other institutions, was called upon to pay heavy withdrawals and the supply of cash was running short. Morgan to Rescue. Shaw, who was then president, favored closing the institution, but he was opposed by the other officials and the directors. It was finally determined to send a committee to visit J. P. Morgan and ask his assistance. The desperate situation was explained to him and he consented to loan $2,000,000 in United States Steel bonds. This enabled the trust company to weather the storm and the doors were kept open throughout the panic. Charles Coulter Dickinson, the company's organizer, died in St. Luke's Hospital last May under circumstances which led to an extended investiga tion. His relatives claimed that his death was caused by injuries he sustained when he fell off his horse ir Central Park. An accident insurance company, in which he had large policies, took up the probe. It developed that sometime before he had attended a chemical test in Pennsylvania, and it was said that he died from the effects of poisonous fumes he inhaled there, while watching experiments that he expected to result in the transmutation of baser metals into silver. Reichmann ended his connection with the Carnegie Trust Company some months ago. He was succeeded by J. T. Howell, formerly president of the Fourth National Bank, of Nashville, Tenn., and he is the present head of the institution.

7. March 23, 1911 New-York Tribune New York, NY

Article from New-York Tribune, March 23, 1911

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Former Banking Supermendent Wrote Flattering Letter to Andrew Carnegie. THEN FOLLOWED BIG LOAN Assured Ironmaster He Would Be Helping in "Accomplishing a Great and Distinct Good. Jordan J Rollins is not the only citien of standing whom William J. Cummins impressed to the extent of a flat tering letter of recommendation Clark Williams. former State Superintendent of Banking is the author of a letter to Andrew Carnegie which Mr Cummins who is now under indictment for grand larceny, delivered to the ironmaster personally This letter. whose existence has been known to some ten men. reads as follows 293 Madison avenue January 12. 1910 Hon Andrew Carnegie, 91st street and Fifth avenue, New York City reMy Dear Mr. Carnegie: At the quest of some members of the directorate of the Carnegle Trust Company write to advise you that during my incumbency of the office of Superintendent of the State Banking Department I became familiar with the affairs of the Carnegie Trust Company I have no hesitation whatever in stat ing that in my opinion such growth and improvement in conditions as the company enjoyed was largely due to the work of Mr William J Cummins and those directors whom he brought into the board and made his associates may say that know Mr. Cummins intimate and great personal friend 1 have vast regard for his ability and integrity of purpose. I feel sure that he and his associates are making sincere and praiseworthy endeavors to improve the condution of the trust company and to obtain for it more favorable regard on the part of the banking community I believe that the condition which they are now seeking to improve does not manner reflect on or impugn integrity or honor. and if you should determine to come to their sistance you would be helping in the accomplishment of a great and distinct good. Faithfully yours CLARK WILLIAMS Mr. Carnegie did go to the assistance of Mr Cummins and his associates, Reichmann Condon and Moore. He lent them on their personal notes, backed up by collateral $2,100,000. which he conveyed to them in the form of United States Steel bonds They still owe him the greater part of that sum. The date of this loan was January 25. 1910 and the occasion for it. it will be remembered. was the presence in the Carnegie Trust Company's vaults of four notes for $600.000 each. executed by T C. Meadows T. M Anderson. the Independent Fertilizer Company and George L. Dyer. These notes, secured by the stock of the Independent Fertilizer Company a paper concern, replaced $2,400. 000 which the late C. C. Dickinson had taken from the coffers of the trust company and used in purchasing the control of the Van Norden Trust Company and the Twelfth and Nineteen Ward banks They were made as an accommodation four directors named and pressed 10: payment Loan of Double Timeliness It happened that on January 19. hetween the date of the Williams letter and that of the Carnegie loan. the Hocking pools collapsed It was rumored at the time that the Carnegie Trust Company held lot of Hocking stock as collateral for loans, an untrue report. and a run threatened the institution. Mr. Carne Rie's assistance, therefore, was of double timeliness Mr Carnegie's steel bonds had a par value of $2,000,000 The Cummins syndi sold them for $2,100,000 and took not named with the proceeds wiping out the obligations of Meadows Anderson and the Independent Fortili Company and leaving Dyer with an indebtedness of $396.000 which includes the interest due on all the notes Mr Carnegie has since bought back of the bonds for 81 soo 00 a profi $200,000 an offset against his ultimate loss the transaction He also in get half a million for the stock the Madison Trust Company numbered among the collateral securing his loan. and he retains through collateral a controlling interest in the Platt Iron Works, of Dayton Tennessee Packing and Stockyards of Nashville and the and Manufacturers' Securties Company a holding concern for Cummins properties M Williams, when asked last night to comment on his letter recommending Cummins to Mr Carnegie, raid he had nothing whatever to say on the subject Carnegie it is known. is much inthe loan transaction the his name by the trust company publicity he has got out of the whole affair In the first place he allowed his name to be given to the company response to a letter from the late dekinson. its founder liken. ing ironmaster to Washington and Lincoln and suggesting the appropriate monument of finance to great figure in the industrial history country Twice Called on for Help Mr Carnegie replied that he was not enxious that monuments be erected to him until after his death, but that in this he would make an exception and grant the request He has since persuaded on two occasions to lend to the company or its officers money name from unpleasant notoriety attendant on the company's 8 collapse, in 1907 following the panic, when he lent the company itself $2,000,000 to tide over. and the second time in JanMary 1910 as described The first loan was paid in full. But more materialistic arguments than that concerning the good of his name were used with effect OD the Laird of Skiba Clark Williams's letter is an ex ample and among others was the as surance given that the trust company was to have plenty of city money Mr

8. November 11, 1911 The Washington Herald Washington, DC

Article from The Washington Herald, November 11, 1911

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DRAINED BANK TO SUPPLY CARNEGIE Head of Defunct Concern Tells of Its Troubles. New York, Nov. 10.-How the defunct Carnegie Trust Company was drained of all its assets, including deposits, to supply Andrew Carnegie with a security for a loan of of $1,500,000 negotiated during the panic of 1907 was told to-day by William J. Cummins, former chairman of the legislative committee in the Carnegie trust, who is on trial charged with stealing $140,000 from a trust fund. Mr. Cummins said that when he came to New York from Nashville, C. C. Dickinson, then president of the Carnegie Trust, induced him to become a director of that institution. He bonded his Nashville holdings for $500,000, and to have his bonds accepted was to buy some stock and get $1,000,000 in new deposits. "I bought the stock," said Cummins, "and I got the deposits, the State of Tennessee being one of the depositors. I raised about $1,200,000. "Then I saw Dickinson about my bonds, but he said he couldn't take them because he had been forced to pay Andrew Carnegie a loan of $1,500,000. He said that during the panic of 1907 Charles M. Schwab and Alton B. Parker had negotiated a loan of $1,500,000 in Steel bonds from Mr. Carnegie, and Mr. Carnegie had taken all the assets of the Carnegie Trust Company as security, in addition to the guarantee of Mr. Schwab and Mr. Parker. Mr. Dickinson said as the money for deposits had come in he had given it to Carnegie." Cummins said he then raised $800,000 more in deposits, but his bonds were never bought. The witness told the history of his financial life, and when court was adjourned had reached the formation of the trust fund of $335,000, which he is accused of stealing. He declared there was nothing improper in his action in applying the checks of the Nineteenth Ward and Twelfth Ward banks and the Van Norden Trust Company to his personal account.

9. November 30, 1911 The Mitchell Capital Mitchell, SD

Article from The Mitchell Capital, November 30, 1911

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OFFICIAL COUNTY PAPER THEFT AND THEFT. One of the results of the failure of the Carnegie Trust Company of New York City, in the panic of 1907, is the conviction this week of William J. Cummins, the real head of the institution, on a charge of grand larceny. The exact accusation was that he appropriated to his own uses $140,000 of trust funds belonging to a bank allied with the Carnegie Company. Unless the conviction is set aside, Cummins will serve from five to ten years in federal prison. It will be generally recognized that, assuming the charge to be true, the punishment is well deserved. It will be regarded by everybody as a sertous offense that Cummins should have taken $140,000 that did not belong to him. There is another law on the federal statute books which declares that any one is a criminal and subject to I penitentiary sentence, who conspires to restrain competition and thus ( creates a monopoly. Having estab1 lished a monopoly, such a criminal may collect $140,000 in unreasonable 0 profits on sales in a week or a 0 day, if he is backed by a characteris1 tically powerful aggregation of P wealth. If he were to do business 8 lawfully, he would not secure the t $140,000 in additional profits. Since be finds it necessary to violate the law in order to secure it, he is no less a thief than is Willima J. Cummins. But this provision of the anti-trust law. has never been enforced, with the V single exception, we believe, of the C case against the turpentine trust. The fa meat packers of Chicago are under 11 criminal indictment and if convicted ca may be ordered to wear stripes. And S H. they are guilty of doing what the ti government says they are doing, they 0 ought to go to prison. a At all events, it should be no less t] permissible for a banker to take a money that does not belong to him tl than for the head of a great industh trial organization to do so. And not to until that fact is actually demonth strated in the enforcement of our th laws can it be said that the law is be no respecter of persons. in D-104-17

10. December 31, 1914 The Blackfoot Optimist Blackfoot, ID

Article from The Blackfoot Optimist, December 31, 1914

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# WAL-LACE BANKER IS LIBERATED Wednesday night to B. F. O'Neil, Wallace banker, incarcerated less than two years ago to serve an indeterminate sentence at hard labor upon conviction of violating the state banking laws. He was handed a full and complete pardon by Governor John M. Haines, who went to the state's penal institution in person for that purpose last Wednesday evening. One other prisoner, Joseph Hunsaker, was liberated. On Dec. 7 the Capital News exclusively announced that O'Neil would be pardoned. O'Neil celebrated his liberation and Christmas eve in Boise last Wednesday night. Later he returned to the penitentiary to spend the night and in a few days will take his final departure, leaving for Spokane, to close some business matters and later go to Pasadena, Cal., to join his wife. He will return to Idaho later. The action by the board of pardons Wednesday night in giving O'Neil a pardon was unanimous. An understanding was reached some time ago to take the step by the board members, Governor Haines, Attorney General Peterson and Secretary of State Gifford. It was to come as a Christmas present to O'Neil and the governor was instructed to carry out the will of the board. When the pardon was handed to him by the governor in the warden's office, to which O'Neil was called, the former banker was so overwhelmed with emotion that he could only chokingly express his thanks as the tears rolled down his cheeks. O'Neil leaves the penitentiary in robust health. Since being received there he has acted as janitor. "Barney," as he is familiarly known, was a model prisoner and popular among the inmates of the prison as well as with the guards because of his optimism and cheerfulness. # Alleged He Wrecked Bank No less than six years ago O'Neil was chairman of the Republican state central committee in this state, a big man politically, financially and in a business way. He was even looked upon as a formidable candidate for the United States senate. Then Carnegie Trust company, of New York in which O'Neil was a stockholder, failed and he lost heavily. Timber and lumber companies in which he was interested also failed immediately following his unsuccessful campaign for the Republican nomination for governor in which he spent a great deal of money. The climax came when the Bank of Commerce failed. O'Neil went into involuntary bankruptcy and moved to Vancouver, B. C. He was indicted by a grand jury, charged with wrecking the bank, and after a hard extradition fight, was returned to Idaho. He served almost a year in county jails in Shoshone and Kootenai counties and was then convicted and sentenced to serve from 2 to 10 years at hard labor in the state penitentiary. An appeal to the supreme court availed O'Neil no relief and he was removed from the Kootenai county jail and brought to Boise. He entered the state prison as cheerful as when he came out. He is said to have been just as cheerful when he was in jail at Wallace and Coeur d'Alene. It was "Whatever's right' with the ruined Wallace banker. In the meantime a receiver was appointed to save something from the wreck of the State Bank of Commerce.