15602. Chelsea Bank Trust Co. (New York, NY)

Bank Information

Episode Type: Run → Suspension → Closure
Bank Type: state
Start Date: December 22, 1930
Location: New York, New York (40.714, -74.006)

Metadata

Model: gpt-5-mini
Short Digest: b0447b78

Response Measures

Full suspension, Books examined

Other: State Banking Department forced closing to conserve assets; press discusses alleged short selling/phone campaign and Communist-instigated rumors.

Description

Newspapers (Dec 23–27, 1930) report steady runs on Chelsea Bank Trust Co., rumors/telephone agitation (alleged Communist-instigated and short-selling-related) and that the State Banking Department forced the bank's closing to conserve assets. Closure is described as a crash/closing with depositors affected; no clear report of reopening, so classified as suspension leading to permanent closure.

Events (3)

1. December 22, 1930 Run

Cause: Rumor Or Misinformation
Cause Details: Runs were driven by widespread rumors and telephone agitation (reports of bank failure), allegedly organized and linked to short selling and purported Communist-instigated calls.
Measures: Depositors formed lines at branches; Banking Department intervened to check a run at one branch (convincing depositors fears were unfounded).
Newspaper Excerpt: there had been steady run the main bank and its several branches for several days, and rumors were broadcast of its predicament.
Source: newspapers

2. December 23, 1930 Suspension

Cause: Government Action
Cause Details: State Banking Department ordered the bank closed to conserve assets after runs and rumors undermined confidence.
Newspaper Excerpt: closing of the Chelsea Bank Trust Co.... The State Banking Department finally forced its closing in order to conserve assets.
Source: newspapers

3. December 25, 1930 Other

Newspaper Excerpt: the Chelsea Bank Trust Co. failed because rumors instigated by the Reds. (press account of allegations and probes).
Source: newspapers

Newspaper Articles (8)

1. December 23, 1930 Times Union Brooklyn, NY

Article from Times Union, December 23, 1930

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Article Text

MARKET HOLDS WELL IN FACE Bank Closing, Steel Output Decline Fail to Spur Selling MOVEMENTS NARROW Prices Slightly Lower at Close in Slow Pre-Holiday Trading JAMES GILL, Confronted with the closing of the Chelsea Bank Trust Co. and with steel output dwindling to low proportions, market held remarkably to-day. Support closing this bank did come surThere been steady run the main bank and its branches several days, runothing of this the were transmitted over the "grapevine" system familiar Street. Leading financiers, while admitthe gravity the situation, not believe that the banking troubles would spread any great extent. The run and subsequent closing was to that to heavy eState Banking Department finally forced order its closing in order to conTrading was orderly and there no offerings of the leaders fell from offerings well absorbed and there no Early there was disposition stocks because of the trend business. big drop in steel January period of inventaking downs. the appearance new busiBut there should means anything, rapid about middle next Prices within narrow trading took on holilimits day the the banking failure sentiment and holiday celebrawas were in many fices and floor of the change. But later business taken all turned watch the effect the banking news the stock market. Prices were lower the of day, but declines were confined limits and and there no sign of wholesale such as seen both after the closing of the before United States. Of Bank Chelsea Bank did not course the compare in with the Bank the United States. but many people small accounts will Call money held steady at the newal rate cent. Time funds were dull short maturities 2½ cent 2% asked, longer dates cent. bid, per cent. asked quiet prime names cent. bid, Am asked. other good 3½ per cent. Am

2. December 23, 1930 Times Union Brooklyn, NY

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Article Text

MARKET WELL IN FACE OF BAD NEWS Bank Closing, Steel Output Decline Fail to Spur Selling MOVEMENTS NARROW Prices Slightly Lower at Close in Slow Pre-Holiday Trading By JAMES GILL, Financial Editor. Confronted with the closing of the Chelsea Bank Trust Co. and steel output dwindling low proportions, the stock market held remarkably well to-day. Support was bank did come There steady run the main bank and its several several and rumors predicament. Naturally nothing this published, the were transmitted over the "grapevine" system of so familiar Wall Leading while admitting the gravity the did not believe that the banking troubles would spread any great extent. run and closing ascribed rumors that spread. leading to heavy withdrawals. Th eState Banking Department was finally forced its closing in order to conassets. Trading orderly and there no of of the fell from day, offerings and there Early there disposition because of the trend steel business. big drop operations looked for January of inventaking and downs. appearance busianything, should ness improvement the be rapid middle month. Prices within narrow limits and trading took on holiday Until of the banking failure sentiment cheerful and holiday celebrawere in progress in many and the floor of the Exfices change. But later the more serious business of trading taken all turned to watch the effect of banking news stock the Prices lower at the market. the but declines confined limits and and there was no sign seen both as before after the closing the Bank States. course the did not with the Bank the United people small will affected. Call money held steady at the cent. Time rate funds dull short maturiwere ties 2½ per cent bid, cent asked, longer dates per cent. asked Commercial paper quiet prime names 2% per bid, asked, and other good names 3½ per cent.

3. December 23, 1930 Times Union Brooklyn, NY

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Article Text

MARKET HOLDS WELL IN FACE OF Bank Closing, Steel Output Decline Fail to Spur Selling MOVEMENTS NARROW Prices Slightly Lower at Close in Slow Pre-Holiday Trading JAMES GILL, Financial Editor. Confronted with the closing of the Chelsea Bank Trust Co. steel output dwindling low proportions, the stock market held remarkably Support bank come prise There had been steady run the main bank and its several branches for several days, and rumors were broadcast of its predicament. Naturally nothing of this was published. the transmitted over the so familiar in Wall Street Leading while admitting gravity the believe that the banking troubles would spread great extent. and closing ascribed that spread. leading heavy Th eState Banking Department finally forced closing in order to conassets. Trading was orderly and there no evidence short offerings Some the fell from best the offerings well absorbed and there was Early there was disposition stocks because the trend steel big drop operations looked for between now and January period of inventaking and holiday shut downs. the appearance new busimeans rapid about the middle next month Prices within narrow on holiday Until the failure sentiment was celebrations many fices and on the floor of the Exchange. later more serious business taken up and all turned watch the effect banking news the stock market. Prices were lower the the declines were confined reasonable limits there was sign of wholesale and such seen both unloading before and after the closing the Bank United States. Of course the Chelsea Bank did not compare size with the Bank of the United States. but many people small accounts will be affected Call money held steady at the re rate per cent. Time funds were dull short maturi per cent 2% cent and longer dates per cent. bid, cent. asked Commercial paper quiet prime names cent. per cent. other good names 3½ per cent.

4. December 23, 1930 Biddeford-Saco Journal Biddeford, ME

Article from Biddeford-Saco Journal, December 23, 1930

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Article Text

CHELSEA BANK, IS CLOSED New York, Dec. state of banks, took sion of the Trust small institution largely actors others italized has deposits and closing the bank followed which last night and continued morning. Chelsea Bank Trust Co. founded 1903 offices. is national and state depository.

5. December 25, 1930 The Daily Worker Chicago, IL

Article from The Daily Worker, December 25, 1930

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Article Text

Admits Wall Street Inside shift the the workers the growing economic crisis which this smashed banks, involving amounting the Tammany district attorney, together Detective Lyons, "Radical and Bomb Squad," charging that the Chelsea Bank Trust Co. failed because rumors "instigated by the Reds." The campaign according these fakers, conducted the telephone.' But how the tnd telephone numbers of the depositors the Chelsea Bank Trust supposed to have been tained the "Reds" not tioned Lyons his associates, Crain and Washburn of the district attorney's The fact of the matter that before the Chelsea Bank Trust crashed its stocks being furious Wall and from Wall Street that the emanated about the bank's condition The day before bank closed the stock dropped share. had been $120. On Dec. there had already been

6. December 26, 1930 The Brooklyn Daily Times Brooklyn, NY

Article from The Brooklyn Daily Times, December 26, 1930

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Article Text

STATE TO PROBE REDS' ACTIVITIES BANK CRASHES Fraud Bureau and Banking Dept. Keep Close Watch on Communists Here. Two State agencies, the Bankof the General's office, are keeping close watch tonow officially held responsible in large measure for the suspension banks since the first of the month, and the attempted attack third which was checked after a run had been started. Strong intervention on the part of the Banking Department after discovery of the third plot, it was revealed today by an official of the department. succeeded in haltIng the run after line of about 1,000 depositors had. formed in one of the branches of this bank. The line disappeared, the depositors finally convinced their fears were unfounded. Banking Department official learned last Saturday of Communist where campaign was being discussed to launch the attack on this institution. Run Checked Within two hours after this was learned. the run was started, but was checked almost immediately. quickly virtually nothing regarding was learned by the With this example before thein, coupled the runs on the Bank United States and Chelsea naBk Trust Co., officials are convinced of strong campaign undermine one bank after another with the mo faiding the Communist plan world against capitalism and all its institutions. Washburn, assistant Attorney charge the fraud has questioned heads brokerage houses and studied their records. Subpenas for other officers and records relating to deals in bank lose no time in pressing charges brokers whom find have had the slightest connection with this whispering campaign and destructive attacks against banks, said. He added he expected to question about 100 brokers about Chelsea Bank trading. today that District Attorney Crain New York County taking an interest in the matter. To Probe Red Activities Assistant District Attorney Charles has directed look into the activities of Communist whether there foundation for belief that the Reds plotting against the banks, and has been working quietly tracing telephone calls depositors in Chelsea bank to withdraw Broderick of the banking department questioned garding the reported run on the third insisted the run never started, although was that one being agitated, by phone calls to thousands of will another two or three days, the said, before he would be in position make complete statement the conditions of the Chelsea bank. He said 80 far as he knew underway to provide loans for this institudone the case of the Bank United States. He also denied he had issued statement that depositors in the Chelsea bank were assured of receiving 100 cents dollar. He had not discussed this phase, he said. and would have no on until his Bank of United States are to tonight in Girls' Commercial H. 883 Classon ave., to discuss affairs. Max D. Steuer. chief counsel for the Depositors Association. is expected to make revelations nature. Plans are being made to broadcast his remarks.

7. December 27, 1930 The Herald-Palladium Benton Harbor, MI

Article from The Herald-Palladium, December 27, 1930

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Article Text

BLAMED Rumors Of Communist Plot To Start Runs Being Probed At New York NEW YORK, Dec. and short selling brokers equally official attempts trace inspired which has sulted the the Chelsea Bank Trust Co. this week. Against group, however, prepared though the state banking department had tangible enough warrant the attention Attorney Crain. closing of Chelsea Bank Trust institution patronized largely stage blamed Joseph Broderick, state banking superintendent upon which gained in proportions unthe doors had closed safeguard the assets Assistant Attorney Gen. Watson Washburn seeking evidence that operators selling Chelsea bank stock short were interested depressing its value. Assistant District torney Pilatsky been assigned down rumors that concerted Communist conspiracy has been way to start bank runs.

8. December 27, 1930 The Daily Worker Chicago, IL

Article from The Daily Worker, December 27, 1930

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Article Text

Admits Truth Names NEW time drags without any reports from Broderick, Tammany henchman, and State Superintendent of Banks, on the facts robbery in the Bank of the United States and the Chelsea Bank Trust Co., which deprived 450,000 depositors of the money they put into these banks, totalling more than the campaign against the Communists, engineered by the Tammany bank officials. and taken up by Fish, Broderick, Crain and others, being intensified. The capitalist press in New York and elsewhere print long stories charging nearly all bank crashes to activities." Hot Air. The charges, consisting of of hot far as to charge Soviet Union with engineering the bank crashes. As the crisis goes, undermining bank after bank, robbing millions of workers and poor farmers of their savings and bringing them closer to starvation, the capitalist press attempting to stir hysteria in order to keep back the workers anger and indignation against the capitalists. Post Little Late. glimmering of what back all contained in the New York Evening Post, Friday. This capitalist sheet prints veiled form what Worker published news nearly two weeks ago, namely, that the Tammany grafting politicians neck deep in the robbery which, together with the crisis, resulted the crash of the Bank of the United States. Stating that an investigation into Bank of the United States would