Sag Harbor Savings Bank - Sag Harbor, NY

Bank Information

Episode Type: Run Only
Bank Type: savings bank
Start Date: April 12, 1886
Location: Sag Harbor, New York (40.998, -72.293)

Metadata

Model: gpt-5-mini
Short Digest: 44a64354

Response Measures

Accommodated withdrawals, Public signal of financial health, Books examined

Description

Secretary-treasurer Richard H. Harris embezzled about $6,000; discovery caused depositors to withdraw but the bank met withdrawals (paid < $10,000), issued a circular assuring depositors, and remained open.

Events (1)

1. April 12, 1886 Run

Cause: Bank Specific Adverse Info
Cause Details: Discovery of a $6,000 defalcation by the bank's secretary-treasurer Richard H. Harris; false entries and abstracted funds led depositors to fear insolvency.
Measures: Directors issued a circular assuring depositors of safety; bank paid out under $10,000 and maintained sufficient funds with correspondent banks (Tradesmen's National Bank and Mercantile Trust Company).
Newspaper Excerpt: Much excitement was caused ... when it was reported that Richard H. Harris ... was a defaulter in $6,000. ... many of the depositors became frightened and it was decided to issue a circular assuring the depositors that everything was safe. ... The whole sum paid out was less than $10,000 and the bank was fully able to meet this run.
Source: newspapers

Newspaper Articles (1)

1. April 14, 1886 New-York Tribune New York, NY

Article from New-York Tribune, April 14, 1886

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Article Text

DEFALCATION IN THE SAG HARBOR BANK. Much excitement was caused in Sag Harbor, L. I., on Monday, when it was reported that Richard H. Harris, the secretary and treasurer of the Sag Harbor Savings Bank, was a defaulter in $6,000. A majority of the people living in Sag Harbor and in the surrounding country were depositors in the bank. The deficit in the assets was discovered by State Bank Examiner Richardson, who arrived 111 Sag Harbor unexpectedly last Thursday. He found that Mr. Harris had made many false entries and had devoted nearly $6,000 to his own use. The sum that he had abstracted was far too small to injure the soundness of the bank, but on Monday, as the directors had feared, many of the depositors became frightened and it was decided to issue a circular assuring the depositors that everything was safe. Yesterday farmers drove into Sag Harbor, and many of them had resolved to draw out their deposits, but on seeing the printed statement of the officers that the bank had a surplus of $85,000, the majority of them were satisfie to leave their money in deposit. The whole sum paid out was less than $10,000 and the bank was fully able to meet this run. More than $3,000 was deposited during the day. The funds of the bank are kept with the Tradesmen's National Bank and the Mercantile Trust Company of this city. The bank Was incorporated in 1860 and is rated as one of the safest in the State. Harris has not yet been arrested but he is kept under surveillance. He was one of the leading members of the Sag Harbor Methodist Church and was superintendent of the Sunday-school. His salary was only $1,600, but he lived within his income, the defalcation being brought about, it is said, by losses in speculation. He is married and has three children.