2527. Bank of Sebastian (Sebastian, FL)

Bank Information

Episode Type
Run → Suspension → Closure
Bank Type
state
Start Date
July 22, 1926
Location
Sebastian, Florida (27.816, -80.471)

Metadata

Model
gpt-5-mini
Short Digest
4c40af95

Response Measures

Full suspension

Other: Directors closed the bank 'for the protection of all depositors'; closure appears voluntary by directors amid wider chain collapse news.

Description

Newspapers (Jul 22–23, 1926) report depositors making a run on the Bank of Sebastian; directors closed the bank to protect depositors and it will remain closed until such time as it is deemed advisable to resume. No reopening is reported in these items, so treated as a suspension leading to permanent closure/continued closure.

Events (2)
1. July 22, 1926 Run
Cause
Rumor Or Misinformation
Cause Details
Unsettled state of mind among the public led depositors to withdraw funds (nervousness/rumors); no specific insolvency cited.
Measures
Directors closed the bank to protect depositors and to await more favorable conditions.
Newspaper Excerpt
For two days depositors had been making a run on the bank, and for the protection of all depositors the directors closed the bank
Source
newspapers
2. July 22, 1926 Suspension
Cause
Rumor Or Misinformation
Cause Details
Bank was closed by its directors in response to heavy withdrawals/run driven by public nervousness; closure described as until it is deemed advisable to resume (no reopening reported).
Newspaper Excerpt
The Bank of Sebastian is closed to business, and will remain closed until such time as it is deemed advisable to resume
Source
newspapers

Newspaper Articles (3)
1. July 22, 1926 Evening Star Washington, DC
Article from Evening Star, July 22, 1926

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Article Text

BANK FUNDS USED FOR BUCKET SHOPS False Transactions Noted to Hide Diversion, Georgia Probers Say. By the Associated Press. ATLANTA, July 22.-Evidence that bank funds had been used for bucket. shop speculation and that fictitious transactions had been resorted to in an effort to hide diversion of funds has been unearthed by investigators into the affairs of the Bankers' Trust Co., Solicitor John A. Boykin announced last night. Bankruptcy proceedings against the Bankers' Trust Co. last week' were followed by the closing of aproximately 115 small banks in Georgia and Florida. Many of these were members of a chain served by the trust company as fiscal agent. "Fictitious transactions to hide funds unlawfully diverted seems to have been one of the favorite systems whereby large sums were diverted to the benefit of the Bankers' Trust Co. and certain of its officials." Mr. Boykin said. "Everything indicates that bank funds involving large amounts have been squandered by certain individuals in Atlanta in bucket shop speculations. No local pride or influence of any kind will deter me from the most vigorous and exhaustive prosecution of the guilty parties." A Fulton County grand jury is conducting an investigation of the Bankers' Trust Co. bankruptcy proceedings. The Bank of Menloe, a member of the Bankers' Trust Co. chain, yesterday turned over its affairs to the State banking department. At the same time five small Florida banking institutions were reported to have suspended operations. They were the Bank of Sebastian, State Exchange Bank, Lake City Savings and Trust Co., Palatka; Polk County Trust Co., Lakeland, and the East Florida Bank at Palatka. None of the five has been definitely identified with the Bankers' Trust Co. chain. Oscar Dooley, former vice president of the Mechanics and Metals National Bank of New York City, was appointed yesterday as an additional receiver for the Bankers' Trust Co. to serve with John K. Otley, president of the Fourth National Bank, and former Gov. Hugh M. Dorsey.

2. July 22, 1926 Vero Beach Journal Vero Beach, FL
Article from Vero Beach Journal, July 22, 1926

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Article Text

Florida Naval Reserve Will Embark Soon FLA., July 22. (INS) Closes Its Doors Florida Naval Reserves will embark on two destroyers August 14, accordThe Band of Sebastian is closed to ing to Lieutenant Commander William business, and will remain closed until of the communLee, in charge Justice such time as it is deemed advisable to The U. division here. ication business. For two days resume D. Edwards will sail from Jacksonville positors had been making a run on the and the S. Barker will sail from bank, ad for the protection of all Miami. Fifty-five officers and dedepositors the directors closed the the cruise, men will compose stroyer bank, and for the protection of all by Charles which will be accompanied good condition, but the unsettled state SentiOrlando Morning Ward of the of mind prevalent at this time among nel and Edward Williams, InternationStaff Correspondent, many people is responsible for the News Service the civilians to accompany run. A similar occurance took place the men on the cruise. in one of the good banks of Orlando

3. July 23, 1926 Daily Kennebec Journal Augusta, ME
Article from Daily Kennebec Journal, July 23, 1926

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Article Text

Bank Funds Used For Bucket Shop Speculation, Indicated Atlanta, Ga., July 22-(P)-Evidence that bank funds had been used for bucketshop speculation and that fictitious transactions had been resorted to in an effort to hide funds unlawfully diverted," has been unearthed by investigators into the affairs of the Bankers Trust Company, solicitor John A. Boykin announced last night. Bankruptcy proceedings against the Bankers Trust Company last week were followed by the closing of approximately 115 small banks in Georgia and Florida. Many of these were members of a chain served by the Bankers Trust Company as fiscal agent. "Everything indicates that Bank funds involving large amount have been squandered by certain individuals in Atlantic bucketshop speculations, Mr. Boykin said. "No local pride or influence of any kind will deter me from the most vigorous and exhaustive prosecution or the guilty parties." A Fulton County grand jury is conducting an investigation of the Bankers Trust Compay bankruptcy proceedings. The Bank of Menlo, a member of the Bankers Trust Company chain, yesterday turned over its affairs to the state banking department. At the same time, five small Florida banking institutions were reported to have suspended operations. The Florida banks were the Bank of Sebastian; State Exchange Bank, Lake City Savings and Trust Company, Palatka: Polk County Trust Company. Lakeland. and the East Florida Bank at Palatka. None of the five had been definitely identified with the Bankers Trust Company chain.