18934. Southern Interstate Bank (Richmond, VA)

Bank Information

Episode Type
Suspension → Closure
Bank Type
state
Start Date
May 22, 1907
Location
Richmond, Virginia (37.554, -77.460)

Metadata

Model
gpt-5-mini
Short Digest
65b3a1f666d4e543

Response Measures

None

Description

Newspaper articles (May 22–30, 1907) describe stockholders seeking a receiver, allegations of fraud/mismanagement, and the Bank of Commerce and Trusts taking over the affairs to liquidate the Southern Interstate Bank as trustee. There is no mention of depositor runs or public withdrawals; the institution is being wound up (trustee/possible receivership) and appears to be closed/permanently liquidated. I classify this as a suspension leading to closure (suspension_closure). 'Voluntary liquidation' is used because the directors arranged a trustee liquidation rather than a sudden suspension tied to depositor panic or explicit government seizure. Significant OCR errors in articles were corrected (e.g., Galeski for president S. Galeski; Judge Beverly T. Crump).

Events (4)
1. May 22, 1907 Other
Newspaper Excerpt
bill in equity by stockholders asking court to appoint a receiver for Southern Interstate Bank; charges of fraud, mismanagement, insolvency; loans to officers alleged
Source
newspapers
2. May 23, 1907 Other
Newspaper Excerpt
Application for Receiver for the Local Institution Will Be Argued; defense says affairs being liquidated by trustee (Bank of Commerce and Trusts)
Source
newspapers
3. May 24, 1907 Suspension
Cause
Voluntary Liquidation
Cause Details
Directors executed agreement with Bank of Commerce and Trusts to take over and wind up the Southern Interstate's affairs as trustee; stockholders challenged this and sought a receiver, but the trustee arrangement proceeded.
Newspaper Excerpt
Application for receivers for the Southern Interstate Bank was denied ... affairs of the former bank are to be liquidated by the [Bank of Commerce and Trusts] acting as trustee.
Source
newspapers
4. May 30, 1907 Receivership
Newspaper Excerpt
Temporary restraining order granted; appointment of a receiver not passed upon and will be heard later by Judge Waddill; case ongoing in appeals/circuit courts.
Source
newspapers

Newspaper Articles (9)
1. May 22, 1907 The Times Dispatch Richmond, VA
Article from The Times Dispatch, May 22, 1907

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ASK RECEIVER FOR STATE BANK in Bill in Equity Is Filed of Chancery Court Richmond. HEARING FIXED FOR TO MORROW What Dr. Galeski and Made Judge Crump Say as to Loans to Them Examination of Books Conducteu Yesterday by Mr. Lamb in the The filing of a of bill the in city equity of John Rich A. Chancery yesterday Court by Attorney stockholders of mond for certain Bank, Lamb, counsel Southern Interstate the appointment this the city asking for take charge of some the of n rece ver bank, to made public to the assets of the allegations as and very interesting of the institution financial status transactions alleged ita Among banking other things, It former is offi certain officers Guild have bor that American large sums It cers of the various securities Bank rowed on Southern Interstate in this connec from the to note officers bor is Interesting guild, whose indebted tion that the bank. was the to rowed from the December 31 1906, cent. to inthe bank on at 6 per 87 the amount of $72,500 American Guild owned Provitorest. cent The of the stock which of was, in March. per dent Savings 1906, succeeded Bank, by the Southern Interstato Bank. Grounds for Action by yesterday The bill in equity counsel filed for Horatio T. J Attorney Lamb, as A. Terrell and G Sharpley Dr G. of the Southern to Terrell. stockholders the court appoint n Interstate receiver Bank, prays for the bank: on the following grounds mimman rement direc- of the The n fairs alleged of the bank by Its the tors. The alleged Illegal over net all of of the directors In that turning Institution to the for assets of and Trusts atBank of Commerce winding up the the of fairn the purpose of Southern Interstate statutes Bank The plaintiffs claim and that prescrib the may the of Virginia which provide a corporation dissolv ved method by its affairs and be not pursue wind up the directors did have the and that and did not of the bank this method, the assets and trusts right to transfer of Commerce of Com tn the Bank which the Bank collect the The terins on agreed to folmerce and Trusts bank are as on of the retiring of 2 per cent assets A comr mission assets and in thereto. of the collections lows: of the the gross salary of Interstate TV. Gray addition cashier 1907 and $1,000 Bank, Wattson, to September 1. any actual clerical hire and winding up the for incurred in of the Interpenses branches Toano state Bank affairs of the at Louisa, Mineral, bill, and Powhatan, Va. plaintiff in the of the G Sharpley of the stock of owns 250 shares of the par value 300 Interstate Bank, Terrel owns Other each Dr. G. J. A. Terrell 500 unite shares. and T permitted to stockholders are in this suit. with the plaintiffs Examination Made. defendant The suit names Interstate as parties Bank, the the the Southern and 'rusts Southern and of Commerce of the Bank and directors The American officers Interstate Bank party defendant the though Is not made a officers of also officers Guild some of the of the guild. about are bank The illegations are of though the bill the filed, bill the italready only stated echnically defendants to access self was permitting the in order to by court to the paper Thursday prepare have their application answer for a receiver Mr when the pro and contra. had will be argued for the plaintiffs, consented Lamb, counsel the bill, and pern. copy of should be docunot that the de fendants custody of the anmitted to ha while preparing filed their in the to-morrow, ment swer. filed It will be really though technically court filed there now nlso granted permission the books The the court plaintiffs to partial examin examination counsel been to of the bank made and by a Mr. The Lamb, interesting phases in has for the of plaintiffs ho situation are the results Times-Disof this examination resontative of The statement representation secured counsel for patch Mr last Hill night Montague Bank as to from the Southern Interstate for a receive for that the of the application Montague stated which and institution Mr. the contract under Trusts S conditions Bank of Commerce collection of the has the undertaken the Southern Interstate that assets of and the emphatically bank stated were guar(te to Bank, the depositors of loss the in the transac the tion anteed He against could not as to spent what as proporstockholders nor vestment they the would at tion of their the winding up He of said, in receive in the retiring bank fairs of matter speaking of the of the Southern No depositor need have the Interstate apprehension Bank as coucern- to the slightest as they are ussets result, NO far have the ed, un they now behind their de- the of the two banks three times and about had. security posits the formerly Saya What Mr Montague the action in 11g Mr Montague deprecated endeavoring to of the of of the plaintiffs receiver and expressed granting st confident curo a belief that the receiver would in the application serve to retard for the bank winding and the the nt merely of the affairs of the assets among He the of distribution and of its the stockholders of depositors about $50,000 rs further said that bank were invested in so. assets of the first mortgage on of an notes secured by twice the amount ins real estate the notes, and worth boaring 6 per cent

2. May 22, 1907 The Times Dispatch Richmond, VA
Article from The Times Dispatch, May 22, 1907

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that It was the best thing that CO possibly be done." As to the allegation of the bill t the bank by this action has sought dissolve itself and to wind up its fairs, Mr. Montague said that Southern Interstate Bank has calle meeting of its stockholders for J 1st to approve the action of the rectors, and that It is known tha majority in interest of the stockho ers Indorse it. When asked if at jority of the stockholders as well a majority of the stock vote Indor the plan, Mr. Montague could not swer positively. He said: "It is lieved that practically all except th stockholders interested In this sult , approve the action of the board. Report Concerning Loans Made Owing to the impossibility of 1 paring the necessary papers in or that the application might be her and because the attorneys had ot engagements. It was deemed best flx to-morrow as the day for argum of the application for a receiver. Attorney John A. Lamb has made examination of the books of the ba as he was authorized by the co yesterday to do. Among other thin Mr. Lamb states that the books : papers of the bank show that lai sums have been loaned to officers a former officers of the American Gu by the Southern Interstate Bank, th loans being secured by indorsemer by real estate security and vario stocks as collateral. Dr. S. Gales president of the bank and supre governor of the guild, according this examination, has made the f lowing loans: He has discounted at 1 bank the notes of J. Osho, of Phi delphia, for $23,000, payable at t rate of $500 per month, the last no being due in 1915, unless sooner anti pated and retired. The books she that Dr. S. Galeski discounted eighte notes for $500 each, making a total $9,000, with the American Guild security. According to Mr. Lamb, the bank h made loans to Judge Beverly T. Crur aggregating $7,740. divided as follow The sum of $3,100, secured by 2,0 shares of the American Guild stoc of the par value of $1 per share; t sum of $375, for which he gave security three shares of the stock the James River Coal Company: t sum of $1,525, for which he gave security 3,000 shares of the stock the Atlantic and Pacific on Compan the sum of $2,300, for which he ga as security 50 shares of the stock the Mason Park Land Company, ne Manchester: the sum of $440, for whi he gave the American Guild as I dorser: total, $7,740 The following loans are said to ha been made by the bank to Mr. Jose B. Montgomery, supreme treasurer the American Guild, according to I Lamb's statement of the result of investigation of the bank's books a papers: The sum of $1,770.45, for wh a deed of trust on certain property Cary Street, in Henrico county given as security; the sum of $2,477 for which he gave as security the dorsement of his wife and 500 sha of the stock of the Ohio and West Oil Company. of the par value of per share: the sum of $1,925.78. which 2,000 shares of the stock of Southern Interstate Bank were gh as security: the sum of $240. secur by the indorsement of his wife: sum of $360, for which W. L. Wari is indorser: the sum of $200, for wh he gave as security a note of Sam Regester for $300; the sum of $300, which he gave as security Dr. Sto of this city. Statement of Dr. Galeski. Dr. S. Galeski, president of Southern Interstate Bank and supre governor of the American Guild, wh asked for a statement as to the S against the bank, and as to its loa and affairs, said: "As to the allegation that the gu owes $80,000 to the bank. as publish yesterday, it did owe this sum. 1 most of this has been paid: all but small amount, in fact. The Americ Guild has always been able to ta care of any of its loans, and is S doing 80. When asked as to the Ohio a Western Oil Company and the va of its stock, Dr. Galeski said: "I haven't any idea; but I believe is $10 per share, par. But I do own any of it, and therefore kn nothing as to its value." Judge Beverly T. Crump. when ask as to the suit and the allegation t1 certain officers of the guild and officers had borrowed from the Int state Bank, stated that he had no ing to say, not being an officer stockholder of the bank. He had bu ness with the bank. which hand some of his paper, but he had alw: been able to meet his paper in E bank, and his business affairs W his own private business. Mr. Montgomery could not be rea ed, even by telephone. last night. resides at Bon Air. and had left city earlier in the evening, and not a phone. Indebted 10 Bank

3. May 23, 1907 The Times Dispatch Richmond, VA
Article from The Times Dispatch, May 23, 1907

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INTERSTATE BANK CASE IS UP TO-DAY Application for Receiver for the Local Institution Will Be Argued. DEFENDANTS WILL RESIST IT Contention Made by Them Is That Present Liquidation Plan Is Best. The application of Attorney John Lamb, counsel for certain stockholders of the Southern Interstate Bank, and the attorneys for this bank, and for the Bank of Commerce and Trusts will appear before Judge Daniel Grinnan in the Chancery Court to-day to argue t the application of Mr. Lamb for a receiver to take charge of the assets of the bank. The answer of the defendant will be filed by Attorney Hill Montague and the application for a reciver will be argued on its merits. It is expected that an interesting e showing of the assets of the bank and of its operations will be made by Mr. Lamb, who has had access to all its e books and papers an has made many S memoranda therefrom, some of which were published yesterday. The defendants will contend that the affairs of the bank are being liquidated more expeditiously by the trustee, the Bank n of Commerce and Trusts than would be possible under a receivership and at less cost to the stockholders. f It will be shown that the depositors are guaranteed against loss under the t arrangement with the trustee bank, and O that the affairs of the Southern Inter11 state will be wound up as speedily d as possible and with small cost. It is e it likely that attorneys for the American V Guild will also appear in court, though that institution is not named as a party y defendant to the suit. d Attorney Lamb yesterday appeared e before Judge Grinnan and represented that he was denied access to all the books and papers of the bank and desired an order from the court for au'S thority to examine these records. The ie matter was not formally in court. Howe, ever, Judge Grinnan expressed the view that as all parties concerned ts courted full and free investigation the y, attorney should be accorded such acncess to the books and records. The at. id torney left with carte blanche to make nsuch investigations as he desired.

4. May 24, 1907 Alexandria Gazette Alexandria, VA
Article from Alexandria Gazette, May 24, 1907

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Virginia News. Governor Swanson yesterday received a photograph of Gen. Kuroki. The general's signature is in Japanese, across the photograph, which was sent in appreciation of his cordial treatment. Confederate Memorial Day was observed at Fredericksburg yesterday. The exercises were participated in by Maury Camp of Contederate Veterans, the Daughters of the Confederacy, and the local military company, Washington Guards. Music was furnished by Franklin's Band of that city. After the services flowers were stewn on the graves of the soldiers. Tbe graves of the Confederate soldiers buried at Manassas were decorated alter the memorial day exercises at Manassas Wednesday afternoon. Addresses were delivered by R. L. Gordon, of Louisa; Judge C. E. Nicol, Mr. J. B. T. Thornton, Rev. W. H. K. Pendleton, of Wytheville. Dr. H. M. Clarkson read the poem which had for its theme the unveiling of the statue of Jefferson Davis. Judge Bennett T. Gordon, of the Circuit Court of Nelson county, has written to Governor Swanson asking him to select and designate some other judge to sit in the already famous case of the Commonwealth VS. W. G. Loving. The letter requests the governor to select some judge, who can be present next Monday morning, or 88 soon thereafter as is practicable, as Judge Gordon declares that he does not wish to have any connection whatever with the case. The grand jury meets at Lovingston on Monday, and then Judge Loving will be indicted for the killing of Theodore Estes. Charges of fraud, mismanagement, and insolvency were made in Richmond yesterday in an application for the appointment of receivers for the Southern Interstate Bank of that city. Three stockholders, represented by Attorney John A. Lamb, bring the charges, which involve S. Galeski, president of the bank, and Judge Beverly T. Crump and Joseph B. Montgomery. The receivership was asked for also on the ground that the agreement under which the Bank of Commerce and Trusts took over the affairs of the Southern Interstate was entered into by the directors of the latter institution without the consent of the stockholders. President Galeski is accused of transferring property to his wife and granting discounts without proper security-Judge Crump is alleged to be insolvent and a beneficiary of the methods.

5. May 24, 1907 The Washington Times Washington, DC
Article from The Washington Times, May 24, 1907

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RECEIVER IS ASKED FOR RICHMOND BANK RICHMOND, Va., May 24.-Charges of fraud, mismanagement, and insolvency were made in an application for the appointment of receivers for the Southern Interstate Bank of this city. Three stockholders, represented by Attorney John A. Lamb, bring the charges, which involve S. Galeski, president of the bank; Judge Beverly T. Crump, and Joseph B. Montgomery. The receivership was asked for also on the ground that the agreement under which the Bank of Commerce and Trusts took over the affairs of the Southern Interstate was entered into by the directors of the latter institute without the consent of the stockholders.

6. May 25, 1907 The Times Dispatch Richmond, VA
Article from The Times Dispatch, May 25, 1907

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In Refusing Receiver for Southern Interstate Bank Judge So Provides. DIRECTORS MAY HANDLE NO FUNDS in This Provision Incorporated Decree of Court in Case-Collateral Deposited for Loans Said to Have Been Valuable When Loans Made. Contrary to expectations and the Attor- announcement made on Thursday, the John A. Lamb did not apply to ney Court of Appeals of Virginia Supreme for a receiver to take Interstate charge yesterday of the Southern and Trusts of the assets for an injunction restraining from Bank, the Bank of Commerce and it had encarrying tered into out with the the contract Southern Interstate Bank's Lamb, directors. when asked as judge to his of Mr. to present his bill to a stated he was that failure Appellate Court yesterday informaJust when the awaiting further he acting tion before probably take further steps state in would he was unable to the matter of great interest in Judge conA feature with the refusal by is that nection Grinnan to appoint a receiver the case he decree entered in into by the the contract entered Trusts, and amends of Commerce and Interthe Bank of the Southern the directors the extent of requiring afstate Bank Bank of to Commerce depositors and Trusts, of the the having paid off the to the court ter Bank, to account directors Interstate thereafter instead of to the This is to of the defunct important as bank indicating turn over that unwilling bank's the court proceeds 19 from the sale of the the Interthe the directors of stated in in assets Bank. to In fact. he his so decision court state in announcing This almost equivalent it is prethe matter In fact, the to a receivership that as soon as dicted by some depositors of the Southern a claims of been satisfied Interstate Bank have probably will l/e In any receiver may and event the assets, of the over appointed. and above the satisfaction will be disposed of claims and of dlsbursed depositors, under the direction of the court. Crump Not Innolvent develops Judge that Dr S. Galeski file an- and It Bev. Crump did not in court Judge the bill of complaint affidavits. swers to but merely filed lie affirms Thursday, Crump's affidavit so shows. In Judge insolvent and that he is not he did not understand into and states that should be dragged had why the bill his name of complaint, since in the he bank owned any interest in any way never been connected with patron. He d or customer and bank, save had as a paper handled by his the obligahad had never defaulted in them. but but ha always me tions Galeski, in his afildavit James, made states before Dr. S. Notary Public Powhatan is, and that his earning power considerable, Y always has been very falled to meet that he has never they became and of his obligations as satisany payable; that he is fully meet all due and will be able to the fied that he mature in obligations that may prompt manner future in the same past: that he he has done in the banks in that been dealing with other which achas city of Richmond, in were commodations the of large amounts never of extended to him, and that he has of these falled to take care of any that he en obligations: that is not true in the has recently sold his real estate matter of e of Richmond, but, as a sell the city several years ago he did and k fact, equity of redemption in the the house city of d lot Grove Avenue in him, for Richmond then owned by which et paid $8,000, and on or which was he at the time of the sale exact by there lien of about $7,000. the him and dates of which will appear office ty is facts the records in the clerk's n, from the Chancery Court of the city of ct of Richmond that this was done long be10 the Southern Interstate Bank was he er incorporated fore or thought of that insury large amount of life of as carries a his life, which in the event as ance lils death on would take care of any estate and all of his obligations should his all of to do SO that practically Interr th fail his obligations to said Southern and Bank are payable monthly as tto state have been promptly met by him ed they became due. d Answer of Bank. te After the session of court Judge on Thursday evening the at decree which refusing Grinnan entered partial answer of the a Southern receiver Interstate Bank to the R amended bill of complaint was filed which by Hill Montague, its counsel, loans Mr. substance as follows: The made is in by the bank to Messrs. Galeski nand Montgomery were made Crump years ago, and the notes now many evidencing these loans are renewal and that all the parties named borrowed notes. the money originally on collateral which was at that time congood. and that all of them vs sidered been curtalling their obligations in have regularly and have never failed to care for their paper promptly on maturity: the they paid the same discount to d, bank that that other customers pay, and that when the collateral, originally It good, was y became impaired in value of the thought best by the officers be and to its interest not to emr bank barrass these gentlemen, but to allow it them to gradually curtail their indebt- were t, edness: and that all the parties rmen of financial standing and of good g earning capacity to Collateral Depreciated. d Judge It was stated yesterday figured that conCrump's loans, which have y spicuously in the bill of complaint Bank, ragainst the Southern Interstat were made originally some years.ago is another bank. and were acquired is from Interstate Bank among its by the Southern predecessor In bus-

7. May 25, 1907 Alexandria Gazette Alexandria, VA
Article from Alexandria Gazette, May 25, 1907

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Virginia News. The grand jury of Fredertcksburg has recommended that the charter of the Fredericksburg Social Club be revoked. The Grand Lodge Knights of Pythians of the State will meet in 39th annual sessian in Lynchburg on Tuesday next. Philip A. Eastham died at his home near Culpeper yesterday in the eightysecond year of his age, He was a Confederate veteran and a gallant soldier. One of the severest bail storms that ever visited the Roanoke Valley occurred yesterday. The ground was covered with hailstones from the size of a bullet to a patridge egg. The storm lasted nearly half an hour. Truck gardens and early vegetation suffered greatly. Capt. Eldridge J. Pattee, of Washington, who had been at the Jamestown exposition, representing the District of Columbia, at the legislative session of the Supreme Commandery of the Golden Cross, died suddenly on a pier at the exposition at 7:30 o'clock yesterday morning. Application for receivers for the Southern Interstate Bank was denied in Richmond yesterday by Judge Grinnan of the chancery court. The object of the receivership sought was to prevent the execution of the contract between the Southern Interstate Bank and the Bank of Commerce and Trusts. The affairs of the former bank are to be liquidated by the latter institution acting as trustee. Application for an injunction order and receivership will now be made before the Supreme Court of Appeals of Virginia. In Carroll county, in an isolated section of the Blue Ridge Mountains, Thursday night about midnight, Rev. Joseph Easter, a Dunkard preacher, was awakened, lured into his front yard, and assassinated, being killed with a shotgun by some one concealed. No reason can be assigned for the crime other than that Mr. Easter would have been an important witness in cases now pending in court, where certain persons in the neighborhood had been indicted for selling liquor illegally and for other lawlessness. Seven-year-old Frederick Jones, son of a prominent citizen at Embreeville, near Bristol, was shot from ambush and fatally wounded yesterday afternoon. A posse with bloodhounds is in pursuit of his assailant. If caught a lynching is probable. The boy W&S on his way home, and while passing through a strip of woods, he suddenly saw a shotgun pointed at him. He threw up his bands and screamed as the gun was fired, the charge entering his head and shoulders. He was picked up unconscious fifty minutes later. The shooting is a mystery, and no probable motive for the act can be assigned. Attorney Charles G. Bond, representing Liebler & Co , of New York, theatrical managers and producers, is preparing evidence in Manchester for the purpose of entering suit against certain church people for the recent production of "Mrs. Wiggs of the Cabbage Patch." The contemplated suit will charge infringement of copyright. The production in Manchester was by local talent, and wasgiven under the auspices of the Earnest Workers of the Presbyterian Church. The activity of the lawyer in the matter has caused considerable excitement among the members of the cast the majority of whom are under age,

8. May 25, 1907 The Free Lance Fredericksburg, VA
Article from The Free Lance, May 25, 1907

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FRAUD IS CHARGED Petition For Receiver For Interstate Bank WORTHLESS NOTES ALLEGED President Galeski, of Richmond, Accused of Transferring Property to Wife-Judge Crump Alleged to be Insolvent and Beneficiary of Methods. Charges of fraud, mismanagement, and insolvency were made Thursday in Richmond in an application for the appointment of receivers for the Southern Interstate Bank, of that city. The stockholders, represented by Attorney John A. Lamb, bring the charges, which involve S. Galeski, president of the bank. Judge Beverly T. Crump and Joseph B. Montgomery. It is alleged "that the said S. Galeski is insolvent. and that recently. with intent to hinder, delay, and defraud his creditors, and without 8 valuable consideration, he conveyed to his wife his residence in Richmond." It is charged that S. Galeski, Beverly T. Crump and Joseph B. Montgomery are insolvent, and "that the board of directors of the Southern Interstate Bank knew this fact at the time they made the loans heretofore referred to." Judge Crump was until recently chairman of the State corporation commission. The report severely criticised the management of the American Guild. It is alleged that Judge Crump had discounted, at the Southern Interstate Bank, paper to the extent of $7,740, for which security of the most intangible kind was offered and accepted, which security, it is charged, would not have been accepted by any bank doing a legitimate business Subsequently, the same charges are made as to the loans to Joseph B Montgomery, who was also an officer of the guild. Attorney Hill Montague counsel for the Bank of Commerce and Trusts, which took over the Interstate as a trustee several days ago, filed an answer to the application. The defendants contended that the affairs of the bank are being liquidated more expeditiously by the trustee than could be possible under a receivership and at lesscost to the stockholders.

9. May 30, 1907 The Times Dispatch Richmond, VA
Article from The Times Dispatch, May 30, 1907

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speech than any other that has been prepared for a long time. CASE SENT TO JUDGE WADDILL Richmond Court to Consider Case of Interstate Bank. [Special to The Times-Dispatch.] ASHEVILLE, N. C., May 29.-The case of Wyckoff and other stockholders of the Southern Interstate Bank, of Richmond, against that institution, brought in the Circuit Court of Richmond, because of a transfer of property to another bank, and for which a receiver was asked, was heard today before Judge Pritchard, and a temporary restraining order granted, returnable before Judge Waddill at Richmond next Saturday. The appointinent of a receiver was not passed upon, but that matter will also be heard by Judge Waddill in Richmond. J. A. Lamb, of Richmond, made argument on behalf of the complainant stockholders, and Hill Montague and J. Garland Pollard appeared for the defense.