3557. Bank of Lineville (Lineville, IA)

Bank Information

Episode Type
Suspension → Closure
Bank Type
private
Start Date
May 1, 1904*
Location
Lineville, Iowa (40.581, -93.524)

Metadata

Model
gpt-5-mini
Short Digest
c33df109

Response Measures

None

Description

No evidence of a depositor run in the articles. The Bank of Lineville ceased business (quit in May 1904) and a receiver was appointed; investigations disclosed large shortages from bad loans and overdrafts. The institution had originally been a state bank (charter expired years earlier) and was operating as a private partnership at failure, so classified as 'private'.

Events (2)
1. May 1, 1904* Suspension
Cause
Bank Specific Adverse Info
Cause Details
Bank quit business after discovery of large shortages caused principally by bad loans, worthless notes, and overdrafts; capital stock impaired and effectively wiped out.
Newspaper Excerpt
the Bank of Lineville which only recently quit business and was succeeded by the First National Bank of Lineville
Source
newspapers
2. June 1, 1904* Receivership
Newspaper Excerpt
Judge Miller had appointed a receiver for the Bank of Lineville ... it was merely a method taken by the old stockholders for liquidating the business of the old bank. ... there was a shortage in the assets of from $20,000 to $40,000, caused principally by bad loans, and there has been some trouble among the stockholders over the matter.
Source
newspapers

Newspaper Articles (8)
1. June 9, 1904 The Leon Reporter Leon, IA
Article from The Leon Reporter, June 9, 1904

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There was considerable surprise Monday when it was learned that Judge Miller had appointed a receiver for the Bank of Lineville, which was supposed to be one of the wealthiest institutions in this part of the state, and there were some wild rumors in the air about the bank having failed, but an investigation revealed the fact that it was merely a method taken by the old stockholders for liquidating the business of the old bank. For many years the bank was operated as a state bank, but their charter expired about five years ago, and since that time until a couple of weeks ago it has been run as a private bank. Recently the business was re-organized and made a National bank, and this bank is perfectly solvent. In settling up the affairs of the old bank it was found there was a shortage in the assets of from $20,000 to $40,000, caused principally by bad loans, and there has been some troub'e among the stockholders over the matter. A. L. Rockhold was cashier of the old bank, but was left out when the bank was re-organized, and the only way the stockholders could settle the trouble was to have a receiver appointed. It is reported that the depositors are perfectly safe and will be paid in full but the stockholders in the bank will have to stand an assessment of 40 or 50 per cent on their stock.

2. July 7, 1904 The Leon Reporter Leon, IA
Article from The Leon Reporter, July 7, 1904

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Lineville Bank Failure. The following article from last week's Corydon Times-Republican probably gives the "true inwardness" of the affairs of the defunct Bank of Lineville so far developed, as the statements it contains were probably obtained from Hon. Lewis Miles and C. W. Steele, who, we are informed, have been retained as attorneys by A. L. Rockhold, late cashier of the Bank of Lineville: IN BAD CONDITION. The affairs of the Bank of Lineville which only recently quit business and was succeeded by the First National Bank of Lineville, have been found to be in a very bad condition. In fact there are so many worthless notes and overdrafts that it is questionable whether the stock is enough to settle the losses and we have heard some reports that the stockholders will have to put in considerable money over their stock to square the indebtedness of the bank, some even placing it as high as from $30,000 to $50,000 above the stock. The Bank of Lineville was organized about twenty-two years ago and its charter was for twenty years. A.L. Rockhold has all the time been the cashier and in recent years his son Pearl has been the assistant cashier When it closed business Ben Wasson was the president. This bank was supposed to be one of the strongest financial institutions in Southern Iowa and the condition it is in is a surprise to everyone. As we said above the cause of its trouble is money loaned on notes which are worthless and also overdrafts. The stockholders are among the wealthiest men in and around Lineville. As the charter has expired about two years ago the bank has simply been since that time or for about two years a plain partnership and each and every stockholder is individually responsible for its debts. This will protect the depositors. They will get their money in full. We understand that a receiver has been asked for. The bank had a capital of $70,000 and as it is all gone and probably considerable more the loss will be sure to be a large one. Advertised Letters. Remaining uncalled for in the post office at Leon. Iowa, for the week ending July 2, 1904: Harry Brewer, Mrs. A. E. Cary. When asking for the above letters please say "advertised." JOHN LEDGERWOOD, Postmaster. Bought experience is all right if you do not nav much for it

3. August 19, 1904 Evening Times-Republican Marshalltown, IA
Article from Evening Times-Republican, August 19, 1904

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Now Develops at Lineville That Capital Stock Will Be Wiped Out MERRIAM NEGLECTED HIS DUTY Examination Showed $70,000 Shortage in 1899, But Inducements of Some Kind Caused State Auditor Merriam to Ignore the Report - Bank Was Allowed To Run on and Shortage Grew. Special to Times-Republican Des Moines, Aug. 19.--It now develops that the failure of the bank of Lineville, Wayne county was a bad one. More of Ex-State Auditor Merriam's cussedness is disclosed and the stockholders are struggling to lock their doors after the horse has been stolen. It is known that the capital stock of $70,000 is more than eaten up by the shortage and that possibly the lat. ter is twice as great. When Harry T. Blackburn, cashier, of the Iowa NatIonal bank, examined the bank under the direction of State Auditor Merriam in the fall of 1899, he reported that the capital stock was impaired to a very serious extent and recommended that various transactions be stopped at once. He showed a shortage of nearly $70,000 to exist even then. But his report was ignored by the state auditor and when the bank's charter expired three months later, after an existence of twenty years, it did not renew it. but became a private institution. In the meantime the depositors continued to entrust their money to the institution and the shortage is said to have grown. At the time of Mr. Blackburn's examination the deposits aggregated $113,000. It is understood they now approximate $135,000. It is conceded by Cashier Rockhold that the stockholders will have to lose the $70,000 capital stock and he indicates that an assessment may be nessary to meet a further deficit. Leland Windsor of this city has just completed an examination of the bank's affairs under the direction of the district court. He was asked today to indicate the nature of his findings, but declined to make any statement. At the office of State Auditor Carroll it was learned this morning that the stockholders of the bank had applied to him two months ago to take. charge of the bank's affairs and wind them up. He declined on the ground that it was a private institution and no longer under state jurisdiction. An effort was then made to compel him to act thru the attorney general, but there was no law to require it. Mr. Carroll took the position that it was a fatal error on the part of his predecessor. Mr. Merriam, to fail to appoint a receiver after Mr. Blackburn's examination in 1899, but that it was now too late for him to act. A receivership was then appointed by the district court, C. W. Nelson being named to take charge of the bank's affairs. At Linevilie the principal complaints are directed at Mr. Rockhold. He is a popular man and was the democratic nominee for state senator against Haselquist last year. So far as is known no criminal proceedings have yet been instituted. Mr. Blackburn's report to Auditor Merriam disclosed some exceptionally loose methods of banking. He showed that the cashier had been in the habit of cashing checks and holding them indefinitely, awaiting deposits to offset f them. It was also shown that a loss of $28,000 was sustained thru loose dealings with J. T. McCarty, one of its patrons. He borrowed large sums of them, giving a second mortgage on 100 t head of cattle and a first mortgage on 103 head of cattle. He was a prominent cattle feeder and shipper and thru failure of the market he was unable to meet his obligations.

4. October 18, 1904 Ottumwa Tri-Weekly Courier Ottumwa, IA
Article from Ottumwa Tri-Weekly Courier, October 18, 1904

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CORYDON. Corydon, Oct. 16.-The case of C. W. Elson, receiver, against the stockholders of the bank of Lineville has been before Judge Turner in the district court this week. After hearing the evidence the court ordered that the deficiency of $35,000 which exists in excess of the $75,000 capital stock of the bank he paid by the stockholders. The total shares of the bank are seven hundred and the court ordered that a fifty per cent assessment be paid within thirty days. This decision makes the depositors and creditors of the bank safe and the only loosers are the stockholders who are out the $75,000 capital stock and the $35,000 assessment. The bank was the oldest in the county and was organized as a state bank, but some twelve years ago the charter expired, and since that time it has been an individual concern.

5. October 20, 1904 The Leon Reporter Leon, IA
Article from The Leon Reporter, October 20, 1904

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The Bank of Lineville Cases. The time of the district court at Corydon was occupied mainly on Saturday and Monday by cases growing out of the failure of the bank of Lineville at this place. In the intervening suit of the directors of the Bank of Lineville against A. L. Rockhold on a note for $10,000, the attachment of the real estate conveyed by the latter to P.A. Rockhold, was dissolved the garnishment remaining in force and the original suit going over to the next term of court. On Monday the question of whether the bank was running under the expired state charter or as a partnership concern came up in court on the application of C. W. Elson, Receiver for the Bank of Lineville, for an order by the court for an assessment of 50 per cent of the capital stock to pay depositors and many witnesses consisting of officers, directors, and stockholders of the defunct bank, and other citizens of Lineville testified and many facts in regard to the loose methods of doing business by the bank, not heretofore made public, were brought out. The trial resulted in a decision by Jndge Towner that the bank had been running as a partnership concern from the expiration of the state charter about five years ago until it went out of business last May, and the order for the assignment of 50 per cont on the capital stock was ordered by the court. If the bank had been in operation under the state charter at the time of its failure the stockholders would have been liable only for the amount of their stock; but as a partnership concern they are held responsible for all of the debts of the bank. Some of the stockholders of the defunct bank are now insolvent and the liability and burden of making good the depositors and other creditors of the bank will rest upon less than half of the original number of stockholders and it is even questioned that they will be able to do so.--Lineville Tribune.

6. December 8, 1904 The Leon Reporter Leon, IA
Article from The Leon Reporter, December 8, 1904

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# Why is Nothing Doing. The thousand or more people who are interested in the settlement of the affairs of the old Bank of Lineville were very much disappointed over the result of the meeting of the directors and stockholders of the defunct concern held here last week. Nothing whatever, as far as made public, was done to facilitate or hasten the settlement of its affairs or throw any additional light on the problem of where the money has gone, who is responsible for its disappearance and when, if ever, the depositors will be paid. J. P. Jordan, of Des Moines, president of the new bank, and vice-president of the old bank, was here and it had been given out that something would be doing when he came; but nothing was doing. Very few people are concerned as to the condition of the new bank, but thousands are directly interested in the settlement of the business of the old bank and in knowing its condition. The impression is gaining ground that Receiver Elson is not doing what might be done to hasten a settlement of the business of the old bank, and even the directors talked of having him removed and a new receiver appointed but it all ended in talk. The apathy and apparent unconcern of those who only have the authority and power to act is unaccountable and the public is becoming impatient over the delay. A Folk is needed here. -Lineville Tribune.

7. January 5, 1905 The Leon Reporter Leon, IA
Article from The Leon Reporter, January 5, 1905

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A suit was brought at Corydon last week before Col. Warren S. Dungan, of Chariton, referee of the federal court of this district, to force A. L. Rockhold cashier of the defunct bank of Lineville into bankruptcy. The suit was instigated by the officers and directors of the old bank and was brought formally in the name of receiver C. W. Elson, the purpose being to recover some thirty or forty thousand dollars worth of property conveyed by A. L. Rockhold to his son, P. A. Rockhold, for the benefit of the bank. The examination took place before referee Dungan, Jas. Parrish, of the firm of Parrish & Parrish, of Des Moines, appearing for the plaintiffs and Miles & Steele, of Corydon, for the defendant. The case goes to the federal court from the referee and it is not yet known how it will terminate.-Lineville Tribune.

8. March 30, 1905 The Leon Reporter Leon, IA
Article from The Leon Reporter, March 30, 1905

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Goes Against Rockhold. The case against A. L. Rockhold, cashier of the late Bank of Lineville, instituted by: Receiver C. W. Elson in the federal court of this district to force Rockhold into bankruptcy, was decided in favor of the plaintiff by Judge McPherson at Des Moines last Friday. The case was bitterly contested at every stage, before the referee and in the federal court, Miles & Steele, of Corydon, being attorneys for Rockhold and Parrish & Parrish, of Des Moines, for the bank. A meeting of the creditors of Rockhold, the Bank of Lineville being the principal one, will be held soon and a trustee appointed to take charge of the assets, and settle up the affairs. All transactions and conveyances of real estate made by Rockhold within four months prior to the filling of the petition in bankruptcy will be held void and all creditors will share pro rata in the proceeds derived by the trustee from the sale of the assets in his hands.-Lineville Tribune. Piles may be your trouble. Antiseptic Pile Cones will cure you. We sell them. 50c. box. W. C. Stempel & Co.