Carnegie Trust Company (New York, NY)

Episode Information

Episode UID
3649913891333
Episode Type
Run → Suspension → Closure
Bank Type
trust
Bank ID
364991389 hash
Start Date
January 7, 1911
Location
New York, New York (40.714, -74.006)

Metadata

Model
gpt-5-mini (chosen from majority vote of a three-model LLM ensemble)
Short Digest
8a34399343b0d899

Response Measures

None

Description

The Carnegie name was used without Andrew Carnegie's authorization, repeatedly noted in coverage.

Events (3)
1. January 7, 1911 Run
Cause
Bank Specific Adverse Info
Cause Details
Quiet run driven by loss of confidence tied to large unsecured loans, questionable loans and connection with indicted officials
Measures
None beyond later calling in State Banking Department to take charge and protect depositors
Newspaper Excerpt
Officials of the closed institution stated that there has been a quiet run on it for more than a week and that this had used up all of the available ready resources
Source
newspapers
2. January 7, 1911 Suspension
Cause
Bank Specific Adverse Info
Cause Details
State examination found the company in an unsound condition to transact business, prompting superintendent to take charge
Newspaper Excerpt
The Carnegie Trust Company ... was closed today by State Superintendent of Banks Cheney. The superintendent of banks has taken charge of the property and business of the Carnegie Trust.
Source
newspapers
3. April 12, 1911 Receivership
Newspaper Excerpt
Payson Merrill was appointed receiver with bond at $100,000. An involuntary petition in bankruptcy was filed against William J. Cummins, president of the failed Carnegie Trust Company.
Source
newspapers

Newspaper Articles (24)
1. January 7, 1911 Perth Amboy Evening News Perth Amboy, NJ
Article from Perth Amboy Evening News, January 7, 1911

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CLOSE DOORS. OF CARNEGIE TRUST TODAY One of the Biggest Financial Institutions in New York Forced to Suspend. MYSTERIOUS DEATH OF DICKINSON RECALLED Special by United Press Wire. New York, Jan. 7:-The Carnegie Trust Company, one of the biggest financial institutions in New York, was closed today by State Superintendent of Banks Cheney. The company was chartered in 1907 and has a made-up capital of $1,500,000, sur. plus and undivided profits of $737,000 and deposits of about $8,900,000. Superintendent Cheney issued the following statement: "The Superintendent of Banks has taken charge of the property and business of the Carnegie Trust. The examination of the affairs of this company has caused the superintendent to conclude that it is in an unBound condition to transact business and that it 'is not safe for it to continue. The examination is not yet complete and no further statement can be made at this time." Officials of the closed institution stated that there has been a quiet run on it for more than a week and that this had used up all of the available ready resources so the State Banking Department was called on to interfere to protect the rank and file of the depositors. The late Charles C. Dickinson, whose mysterious death on May 24, 1910, following gas poisoning while witnessing a chemical demonstration in Scranton, Pa., has never been thoroughly solved, was one of the prime movers in founding the trust company. After the company had been doing business for a few months Dickinson resigned in favor of former Secretary of the Treasury Leslie M. Shaw. Shaw held office but a few months, his resignation being due to politics, and Dickinson was reelected. The company grew under the aggressive policy of Dickinson, but his management drew considerable criticism because of certain unsecured loans he made to George T. Sheldon, president of the Phoenix Insurance Company, who died under indictment. J. P. Howell is the present president of the company. Controller Prendergast, of New York city, in a statement issued this afternoon, accuses City Chamberlain myth OF fevorism 4 the matter of keeping a big deposit in the Carnegie Trust Company in the face of unfavorable stories concerning the affairs of the institution, He says that in July he told Deputy Chamberlain Walsh that $1,000,000, the amount which the city had then with the concern, was too large a sum to deposit in a banking institution whose methods well the subject of unfavorable discussion. Withdrawals were made for a time and then ceased, according to the controller, and a few weeks ago the amount stood at $800,000.

2. January 7, 1911 The Richmond Virginian Richmond, VA
Article from The Richmond Virginian, January 7, 1911

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LOANS TOO LARGE TRUST CO. CLOSED Carnegie Concern Forced by Bank Examiner to Suspend Business LOOK INTO BOOKS SHOWS IT UNSOUND Institution Forced to Front by Dickinson, Whose Sensational Death in Office of Chemist, is Mystery NEW YORK, January 7.More Jian $11,000,000 is involved in the closing of the Carnegie Trust Company, the tast report of the institution to the State banking department, on November 10, 1910, showing total assets of $11,170,600, The Carnegie Trust Company. was a margin depository of the New York Cotton Exchange, but is said It had not received a large percentage of the business of the exchange lately. NEW YORK, Jan. 7.-The Carnegie Trust Company, one of the large fine ancial institutions in New York, was closed to-day by State Superintendent of Banks Cheney. The company was chartered in 1907 and had a paid-up capital of $1,500,000; surplus and undivided profits of $787,000 and gross deposits of about $8,200,000. j. T. Howell, formerly president of the Fourth National Bank, Nashville, Tenn., was presidene. Officials of the closed institution stated that there had been a quiet run on it for more than a week and that this had used up all of the available ready resources, so the State banking department was called on to interfere to protect the rank and file of the depositors. Condition Not Sound. O. H. Cheney, head of the banking department, issued the following statement: "Superintendent of banks has taken charge of the property and business of the Carnegie Trust Company. The examination of the affairs of this company has caused the superintendent to conclude that it is in an unsound condition to transact business, and that it is not safe for It to continue. "The examination is not yet complete and no further statement can be made at this time." Large Unsecured Loans. The late Charles C. Dickinson, whose mysterious death on May 24, 1910, following gas poisoning while witnessing a chemical demonstration in Seranton, Pa., has never been thoroughly solved. was one of the prime movers in founding the Carnegie Trust Company, which opened for business January 1, 1907. After the company had been doing business for a few months, Dickinson resigned in favor of Leslie M. Shaw, formerly secretary of the treasury. Dickinson remained as a vice-president and vire tually manager of the trust company. Shaw held the president's office only a few months and Dickinson was, res elected. Shaw's resignation was due, it is said, to politics, Dickinson alleging that the former secretary was beset with a "bee to become president of the United States." The Carnegie Trust Company grew under the aggressive policy of Dickinson. His management. however. eventually drew considerable criticism because of certain unsecured loans (Continued on Fourth Page.)

3. January 8, 1911 The Brunswick News Brunswick, GA
Article from The Brunswick News, January 8, 1911

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STATE CLOSES CARNEGIE BANK INSTITUTION WITH DEPOSITS OF TEN WILLION, SUSPENDS BUSINESS. "Andy" However, is Not a Stockholder, the Philanthropist's Name Used Without Authority-Former Secretary of Treasury was President. New York, Jan. 7.-The Carnegie Trust company was closed this morn ing by direction of State Superintendent of Banks Cheney. This institution has a capital of $1,500,000 and deposits that aggregate $10,000,000. The institution encountered serious trouble in the panic of 1907 and never fully recovered. It was only in that same year that the company was organized. Former Secretary of Treasury Leslie M. Shaw became president, but resigned because of differences with other officials. Carnegie Not Stockholder. Because of the fact that the name of Carnegie is attached to the institution, the action of State Bank Superintendent Cheney today has attracted unusual attention. The adoption of Carnegie's name was without his authority or approval. It is understood that he was not even a stockholder and was not immediately identified with the bank. News Spread Rapidly. The news of the bank's suspension spread rapidly. Hundreds of depositors assembled about the doors before the usual hour of opening. No information as to the bank's condition has been given out by the bank officials or the state authorities.

4. January 9, 1911 Las Vegas Optic Las Vegas, NM
Article from Las Vegas Optic, January 9, 1911

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NO REAL CAUSE FOR ALARM TRUST CARNEGIE COMPANY AN FAILURE DECLARED ISOLATED ONE STILL SEVERAL RUNS RESULT J. P. MORGAN OFFERS ASSIST. ANCE TO INSTITUTIONS AFFECTED New York, Jan. 9.-The financial situation was decidedly clearer today as the result of conferences held last night to provide against any unsettled stabi'ity of the financial organizations allied with the Carnegie Trust company. One thing appeared to be plain. That was that the trouble of the Carnegie Trust company and its allied was isolated and . the failure was not indicative of any widespread trouble in the financial world. There was a slight run on the Twelfth Ward bank in Harlem this morning, but the depositors soon were reassured and many went away without withdrawing their deposits There was also some excitement in the savings department of the Nineteenth Ward bank at 57th street and Third avenue and at its branches on 86th and 72nd streets, where several hundred people were in line. There was no disorder, however. J. P. Morgan has agreed to give whatever financial assistance is necessary to the Nineteenth ward and the Twelfth ward banks.

5. January 9, 1911 The Madison Daily Leader Madison, SD
Article from The Madison Daily Leader, January 9, 1911

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HAD DEPOSITS OF NINE MILLIONS Carnegie Trust Company of New York Suspends. NO BAD RESULTS FOLLOW Institution Was Closed by State Bank Examiner, Who Says "It Is in an Unsound Condition"-Was Organized in 1907 and the Name Carnegie Adopted Without the Ironmaster's Permission or Approval. New York, Jan. 9.-The Carnegie Trust company, one of the largest banking institutions in the city, with deposits of nearly $9,000,000, closed its doors by order of State Superintendent of Banks Cheney. The suspension hardly caused a ripple in the financial district, where the trust company was often reported in a shaky condition. Superintendent Cheney, in an official statement, said an examination of the trust company had caused him to "conclude that it is in an unsound condition to transact business and that It is not safe for it to continue." State banking officers are now probing the company's books. Officials of the trust company have made no statement and the extent of liabilities is unknown. Bankers, however, say depositors will be paid in full. The institution was organized in 1907 and after the retirement of Leslie M. Shaw from the office of secretary of the treasury he become its president. The name of Carnegie as applied to the institution attracted to it a great deal of attention, but the adoption of this name was without Mr. Carnegie's authority or approval. It is understood he was not a stockholdor and not immediately identified with it. Mr. Shaw's connection with the bank ceased after a few months because of differences with the other of ficers of the institution. In Trouble a Year Ago. It is understood that a year ago the institution was in more or less trouble, growing out of the fact that one of its chief officers, in connection with a well known banker of Wall street, had effected a very large loan from it to enable him to buy out and consolidate with it another institution, but this falling through left the Carnegie institution with a large amount of funds locked up. News of the suspension spread rapIdly and hundreds of depositors had assembled about the doors even before the usual hour of opening. The following statement was issued by Superintendent of Banks Cheney relative to the closing of the company: "The superintendent of banks has taken possession of the property and business of the Carnegie Trust company, located at 115 Broadway, Borough of Manhattan. "Examination of the affairs of the company has caused the superintendent to conclude that it is in an unsound condition to transact business and that it is not safe for it to continue. The examination is not yet complete and no further statement can be made at the present time."

6. January 9, 1911 The Detroit Times Detroit, MI
Article from The Detroit Times, January 9, 1911

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Francis Walsh & Co., the of that institution. The cashof the Metropolitan says, however, that not more than $4,beionging to this institution was on deposit there. The People's State bank had a running account with the Carnegie Trust Co., making most of the Detroit collections for them. There was no money belonging to the People's State on deposit in the closed New York institution. NEW YORK, Jan. 9.-The Car Trust Co. was closed today by Superintendent of Banks eney. The company was chartered in and had a paid up capital OF 500,000; surplus and undivided ofits of $737,000, and gross deposits about $8,900,000. J. T. Howell was esident. H. Cheney, head of the state nking department, issued the folwing statement: "The superintendent of banks has charge of the property and siness of the Carnegie Trust Co. examination of the affairs of this mpany has caused the superintendto conclude that it is in an unund condition to transact business, that it is not safe for it to conThe examination is not yet comand no Aurther statement can be at this time." The late Charles C. Dickinson, whos vsterious death on May 24, 1910, folgas poisoning while witnessa chemical demonstration in ranton, Pa., has never been thorghly solved, was one of the prime in founding the Carnegie Co., which opened for business 1. 1907. After the company had doing business for a few months, ckinson resigned in favor of Leslie Shaw, formerly secretary of the easury. Dickinson remained as a e-president and virtually manager the trust company. Shaw held the esident's office only a few months Dickinson was re-elected. Shaw's resignation was due, it is to politics, Dickinson alleging former secretary was beset with a to become president of the States." The Carnegie Trust Co. grew under aggressive policy of Dickinson. management. however, eventually considerable criticism because certain unsecured loans made to P. Sheldon, President of the oenix Insurance Co., who died under lictment. It wah authoritatively that the Sheldom loans were ignificant in amount and that the company sustained no loss. short time before Dickinson's sterious death, Rudolph Kleybolte Co., got an order from the court the examination of Dickinson, his and Robert B. Moorehead, cretary of the Carnegie Trust Co., the matter of a loan of $1,000,000 to P. J. Keiran, of the Fidelity nding Co., which had been put partin the name of Kleybolte & Co., It alleged, in order to avoid having large a loan in the name of Keiran. Dickinson died of pneumonia and disease, it was said, but it was ther declared that the contributing of his death was the inhalation poisonous gases in F. W. Lange's oratory in Scranton, Pa. It was that Dickinson and others were witnessing the experiments of a emist on a non-corrosive metal, other stories were that Lange imed to be able to make silver or from baser metals. The mystery never cleared up, for the Scranchemists denied that any gas Dickhis inhaled had contributed tohis death. There were reports Dickinson had committed suicide, these reports were strenuously Some time before his death, con was thrown from his horse Central Park and his skull fracoseph G. Robin, the indicted ecker of the Northern bank, was lirectly responsible for the closing the Carnegie Trust. He was one of original directors of the Carnegie was forced out two years ago. fact that Robin had been connectwith the institution, however, startthe run that caused the suspensouthern brokers and financiers Georgia Tennessee. Mississippi

7. January 10, 1911 Evening Journal Wilmington, DE
Article from Evening Journal, January 10, 1911

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been after it ever since it was reorganized from the old Van Norden Trust Company. How He Will Pay For Them. To pay for the three institutions it is expected Morgan will increase the stock of the Equitable Trust Company and exchange it for the outstanding shares of three companies, making the actual cost to Morgan personally only about what the engravers' bill will be who furnishes the new stock. The $20,000,000 of assets of the three concerns which were in danger will add materially to the attractiveness of the Equitable Trust Company's balance sheets hereafter, in the opinion of financial experts, who have watched the present situation. Normal conditions prevailed at all of the banks today, the slight run on the Nineteenth and Twelfth Ward Banks and the Madison Trust Company, which prevailed yesterday not being renewed. It was stated by State Superintendent of Banks Cheney today that the affairs of the Carnegie Trust Company will be liquidated at once and no attempt will be made to put the institution in shape to continue business.

8. January 13, 1911 Watertown Leader Watertown, WI
Article from Watertown Leader, January 13, 1911

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SUPPORT HALTS BANK TROUBLES Quick Action by Big Interests Prevents Possible Runs. New York.-Owing to the quick and strong support given by J. P. Morgan & Co., Kuhn, Loeb & Co. and other powerful banking interests to a situation that for a short time was delicate, the city of New York was saved from bank runs that might have led to general excitement and temporary financial derangement. When it became known that the interests named had organized themselves into a committee of defense against the probable bad effects of the failure of the Carnegie Trust Co., the apprehended runs on the Madison Trust Co. and its subsidiaries, the Twelfth Ward bank and the Nineteenth Ward bank, with several branches scattered through the city and all affiliated with the unfortunate Carnegie Trust Co. were virtually averted. Although there were steady withdrawals from these banks and their several branches all day, at no time was there a panicky feeling.

9. January 18, 1911 Vilas County News Eagle River, WI
Article from Vilas County News, January 18, 1911

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SUPPORT HALTS BANK TROUBLES Quick Action by Big Interests Prevents Possible Runs. New York.-Owing to the quick and strong support given by J. P. Morgan & Co., Kuhn, Loeb & Co. and other powerful banking interests to a situation that for a short time was delicate, the city of New York was saved from bank runs that might have led to general excitement and temporary financial derangement. When it became known that the interests named had organized themselves into a committee of defense against the probable bad effects of the failure of the Carnegie Trust Co., the apprehended runs on the Madison Trust Co. and its subsidiaries, the Twelfth Ward bank and the Nineteenth Ward bank, with several branches scattered through the city and all affiliated with the unfortunate Carnegie Trust Co. were virtually averted. Although there were steady withdrawals from these banks and their several branches all day, at no time was there a panicky feeling.

10. March 25, 1911 The L'anse Sentinel L'anse, MI
Article from The L'anse Sentinel, March 25, 1911

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The movement for a "Sane Fourth" has put the largest manufacturer of fireworks out of busines. The Pain Manufacturing company, a $50,000 corporation of New York, applied to Supreme Court Justice Guy for leave to dissolve and assigned this reason as cause for the proposal. In the crop growing pennant race of 1910 Iowa wrested from Illinois first place in the production of oats, California took from Minnesota the honors for the production of barley, and New York secured the hay growing title from Iowa, according to an announcement made by the department of ag. riculture. ... At the Carnegie Trust company inquiry before the grand jury in New York city it was stated that Andrew Carnegie would lose $800,000 by the forgery of an official in the wrecked bank. ... Judge Frank Gorman of the court of common pleas at Cincinnati dismissed the contempt charges against George B. Cox, banker and political leader. He declared the utterances by Cox, which were published after the politician's indictment for perjury, were "insolent and false." ... The uprising in Mexico has spread to the states of Coahuila and Morelos, according to advices received by the revolution agents. The uprising in Morelos is of formidable proportions. The center of the trouble in the northern section of Mexico heretofore has been the states of Chibuahua, Lower California and Sonora. Miss Susan G. McComber, a $19-aweek bookkeeper, fort. two years old, has admitted robbing the John Lane Publishing company of New York, her employers, of $9,000, solely, she said, to maintain her aged parents in a comfortable home. ... A gale caused the collapse of the walls of the burned J. H. Fall building at Nashville, Tenn., burying beneath a carload of debris insurance men, contractors and laborers to the number of 30, and of this number 12 dead were taken out and as many more injured. Miss Helen Zander, daughter of a Kalamazoo (Mich.) resident, lies at her home in a serious condition as the result of injuries received in being initiated into the Gamma Delta Tau sorority. ... Half a hundred persons, a majority of them children under twelve years of age, went through thin ice to their death in New England and the maritime provinces of Canada in the winter just closing. The Kalamazoo (Mich.) Commercial club has given impetus to a movement to erect a $50,000 statue of ex-Senator Julius Caesar Burrows at Milham park, Kalamazoo. ... Frank Clavansky, a well-known acrobat and vaudeville performer, who fractured his spinal column in a fall while performing a trapeze act at a New York theater, died in the Harlem (N. Y.) hospital. The Utah state senate adopted a memorial to congress protesting against certain features of the Canadian reciprocity treaty. It had been adopted previously by the house

11. March 27, 1911 The Sun New York, NY
Article from The Sun, March 27, 1911

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loan in city bonds obtained from the Northern Bank. The Grand Jury doesn't want to deal harshly with the official in question. Many persons have come forward to speak as to his good character and to say that he was used by others. Furthermore. the District Attorney believes that the official will not be unwilling to clear up certain points that the Grand Jury considers essential. Bank Superintendent O. H. Cheney will return to-morrow from Colorado. While he has been away Receiver Egbert and Lawyer Hartfield. in charge of the collection of money due the Carnegie and of liquidating assets, have made considerable progress. It is understood now that the deficit will be under $2,000,000. The receiver is negotiating for the sale of the South Shore Traction franchise and the Morris Park property held by the Fidelity Development Company.

12. March 31, 1911 The Citizen Honesdale, PA
Article from The Citizen, March 31, 1911

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by the Grand Jury or falsifying a institution monthly report of dated August 31, 19 He pleaded for trial unnot guilty and was e bond was der $10,000 bail. furnished by a sur company. Like his associa William J. Cummins, Reichma through his attorney, Stephen Baldwin, took ht to withdraw advantage of his the plea of guilty. The date for the final pleading was set for April 10. It is understood that in the meantime a motion will be made to the court for permission to inspect the minutes of the Grand Jury which step will be vigorously contested by District Attorney Whitman. This indictment charges a misdemeanor. In asking that bail be fixed at $10,000 the District Attorney stated in open court that the present charge was but a fore runner of further action that might be expected from the Grand Jury against Reichmann. The Reichmann indictment was only an incident in the day's developments, which now not only involve a high city official and officers of the Carnegie Trust Company, not yet named, but the State Banking Department as well. The name of Andrew Carnegie, the iron master, was again brought into prominent, notice by a formal demand from George L. Dyer for the return of 8,000 shares of the capital stock of the Platt Iron Works, of Dayton, Ohio, a Cummins enterprise, of which Joseph R. Reichmann was President. This stock Mr. Carnegie received from the trust company in January, 1910, for a loan of $2,100,000. The loan was made to save the Carnegie Trust Company after the run that followed the collapse of the Hocking Valley pool. Mr. Dyer claims that Independent Fertilizer stock was substituted for Platt Iron stock. Subsequently the Platt Iron stock was turned over to Mr. Carnegie as collateral for his loan. At a late hour last night Mr. Whitman was in conference with Former Governor Frank Black with a view to making final arrangements for assisting in the prosecution of the Reichmann-Cummins crowd. Up to the time of the conference Mr. Black had not given his consent to enter the case.

13. April 10, 1911 New-York Tribune New York, NY
Article from New-York Tribune, April 10, 1911

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Says City Has Lost Nothing. Perhaps the first thing the public would like to know is that, notwithstanding all the talk, not a dollar of the city's money has been lost and not a dollar is in jeopardy. The first of the many statements that have been fed to the public to connect me with alleged improper transactions is a fair sample of all or most of it. In that statement the press bureau which has been busily engaged in endeavoring to poison the public mind spread out far and wide the story that 1 Kent a balance in the Northern Bank of over $1,000,000. From this it was implied or insinuated that there must have been a corrupt understanding with some one. This fairly illustrates the sort of "evidence" upon which I am being assailed. The facts are as follows: The designation of the Northern Bank as a city depository was made long before my term of office began. The selection of the Bronx branch of that bank as the depository to receive Bronx revenues was made at the request of Controller Prendergast, who had been a director of that bank until shortly before he took office. Mr. Wolfe. the chief auditor in the Controller's office. was also vice-president until he took office, Janary 1. 1910. The circumstances of this selection have already been publicly stated and are well known. It is true that on October 31. 1910. late at night, the receiver of taxes (an appointee of the Controller) deposited the tax receipts for that day, amounting to about $887,000. in the Northern Bank, but it is also true that $900,000 was withdrawn by my deputy the next morning, leaving the bank's balance at the normal amount about $188,000. Yet the public is wilfully led to believe that I kent $1,000,000 there. to be loaned to friends. Could anything be any more diabolical? Coming then to a discussion of the relations of his office with the Cummins syndicate, which was in control of the Carnegie Trust Company before that institution went into the hands of the State Banking Department Mr. Hyde says in effect that the only basis for any question was the story of Robin. The coincidence of loans by some nineteen banks and trust companies to the Cummins syndicate at or very near the time when those nineteen institutions received augmented deposits of city money is "suddenly discovered," says Mr. Hyde. and this syndicate was composed of men "who were supposed to have my friendship." His statement continues With Robin's story as a basis, it is suddenly discovered that a syndicate or assoContinued on second Daza.

14. April 12, 1911 The Daily Telegram Clarksburg, WV
Article from The Daily Telegram, April 12, 1911

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According to Petition Filed in Court by Three of the Creditors. ASSETS VERY SMALL Receiver is Appointed for Official's of Failed Trust Company. NEW YORK, April 12-An Involuntary petition in bankruptoy was filed here today against William J. Cummins, president of the failed Carnegie Trust Company, now under indictment. His liabilities are given as $5,000,000 and assets as $400,000. Payson Merrill was appointed receiver with bond at $100,000. Two other petitions in bankruptcy were filed against Charles Arthur Moore, Jr., a director of the Carnegie Trust Company, and Martin J. Condon, also a director. The Nabilities of Moore are give. as $2,000,000 and his assets as $100,000, and Condon's liabilities are $6,500,000. and assets $500,000. The three petitioning creditors allege preferential payments and transfers of property while insolvent. It is said that Cummins is no win Nashville, Tenn. The actions were not brought against the respondents as directors in the Carneie Trust Company, but as individuals. The Carneigie Trust Company and Long and Edge failures were thrust over the precipice by the failure and indictment of Joseph G. Robin.

15. April 15, 1911 Evening Star Washington, DC
Article from Evening Star, April 15, 1911

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# Moore Leaves Rome for North. ROME, April 15.-Charles Arthur Moore, jr., director of the suspended Carnegie Trust Company of New York, and against whom an involuntary petition in bankruptcy was filed recently, left here last Thursday for the north of Italy. It is believed he is on his way to America.

16. April 16, 1911 New-York Tribune New York, NY
Article from New-York Tribune, April 16, 1911

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Another overheard snatch-merely a hint-refers to the eighty-six mahogany desks, the million-odd envelopes and the 25,263 lead pencils, which were counted in by the receivers among the assets of the trust company. Figuring on forbearance loans uses up pencils fast. Those "forbearance loans" made an interesting fragment in themselves. A forbearance loan is made in this manner: A man or a concern who is friendly with the officers of a banking institution (if such another banking institution as the Carnegie still exists), makes a draft on some firm or individual in a city at a considerable distance from New York. There is no intention of collecting the draft from the person on whom it is drawn, so there is no need that he should owe any of the parties a cent, and usually, it is said, he does not. The draft goes to the bank and passes through the regular course of all well behaved drafts, until it has been entered on the books of the bank to the credit of the needy firm or individual who made it, so that its amount may be drawn out by check. Then the draft itself-the written paper-is taken in and laid on the desk of one of the friendly officers of the bank. He slips it into an envelope and, instead of sending it West for collection, drops it into a pigeon hole. When the man or the firm who made it is ready to return the money, the need for "forbearance" being safely past, he takes the money to the friendly official, who uses it to pay the draft.

17. April 16, 1911 New-York Tribune New York, NY
Article from New-York Tribune, April 16, 1911

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# C. A. MOORE. JR., LEAVES ROME. Rome, April 15. - Charles Arthur Moore, jr., a director of the suspended Carnegie Trust Company, of New York, and against whom an involuntary petition in bankruptcy was filed recently, left here last Thursday for the north of Italy. It is believed he is on his way to America.

18. June 17, 1911 Omaha Daily Bee Omaha, NE
Article from Omaha Daily Bee, June 17, 1911

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# LESSONS IN CROOKED BANKING System by Which a New York Financier Got Away with the Money. The strange ins and outs of high finance as they are displayed in the narrative of the collapse of the Carnegie Trust company of New York are detailed in an article in Hampton's by Frank Parker Stockbridge. Equally interesting are the life stories of some of the men concerned in that huge failure. Of Robin, the immigrant who became a powerful banker, Mr. Stockbridge says: Deposits accumulated in Robin's Northwestern bank, where he was chairman of the executive committee, until more than $8,000,000, mostly the funds of small tradesmen doing business in Harlem and the Bronx, were in its coffers. His Riverside bank was prosperous. People were flocking to put their money into his Washington Savings bank and he began to look around for other ways of getting the money. He got into the Fidelity Development company, a real estate concern which owned the old Morris Park race track, and soon controlled it. He acquired control of the Bankers' Realty and Surety company. To carry out his schemes he needed a title insurance company. The Aetna Indemnity company of Hartford, which had formerly been one of Fritz Heinze's concerns, owned the Title and Guaranty company of Rochester. Robin bought control of the Aetna and from it purchased the Rochester concern. The savings bank could lend money on the real estate owned by the realty companies. The Title and Guaranty company could guarantee the mortgages to satisfy the bank examiners, and the two commercial banks could lend money on the capital stock of any of the other companies or of each other. With all these institutions under his control Robin could take money out as fast as the public put it in. His personal tastes were luxurious, even oriental. He established himself in luxurious apartments, gorgeously furnished, in an expensive house in Gramercy park. Like other players in the big game, he wanted a country place. He built a magnificent mansion at Wading River, Long Island. One of the important details of "Driftwood Manor," as called his place, was its well-stocked wine cellar. Robin entertained house parties of kindred spirits, men and women. The residents of the little village of Wading River talk of the things that went on at these house parties. They tell stories of the "Snow Waltz," in which, after a night of revelry, the dancers would whirl out through the open door and, regardless of low necks and thin slippers, would finish their dance on the snow-covered verandas. Other tales are of a summer sport of a somewhat similar nature in which the pond near the house took the place of the veranda. No matter how fast the money came in, Robin always needed more. There was no end to his schemes and for the most part they were good and perfectly legitimate schemes. He conceived the idea, for example, of running a trolley line across the new Queensborough bridge and through Long Island City to Jamaica. Such a line would tap a large, undeveloped section of Long Island and be of real public service. He obtained a franchise for this line, including the only available route to Jamaica. He organized the South Shore Railroad

19. June 29, 1911 Evening Star Washington, DC
Article from Evening Star, June 29, 1911

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# JURY'S VERDICT A BLOW # TO JOSEPH B. REICHMANN Former President of Carnegie Trust Company Fully Expected to Be Acquitted. NEW YORK, June 29.-Joseph B. Reichmann, formerly president of the Carnegie Trust Company, was found guilty yesterday of making false statements to the state banking department. The jury deliberated for an hour and a half. When the verdict was announced Reichmann, who had entered court jubilant and confident of acquittal, reeled and would have fallen if a court officer had not supported him. The conviction is the first in this state of a banker for knowingly concurring in a false report. The law carries a $500 fine or one year's imprisonment, or both. The district attorney said after the verdict that William J. Cummins, who is under indictment for larceny from the company, will next be called to trial, and after him former City Chamberlain Charles H. Hyde, under indictment for bribery. Reichmann, when he had partially recovered from his first shock, commented grimly: "You never can tell what twelve men will do." Reichmann's case was regarded as of fundamental importance to the tangled situation resulting from the suspension of the Carnegie Trust Company and the resulting prosecutions. One of the issues of the trial was the entry of a loan of $130,000 obtained from the Northern Bank for the trust company by Joseph G. Robin. Unless the court grants the motion for an arrest of judgment Reichmann will be sentenced tomorrow. Meanwhile he continues at liberty under his $10,000 bail.

20. November 24, 1911 The Evening Times Grand Forks, ND
Article from The Evening Times, November 24, 1911

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# CUMMINGS GOT # SENTENCE TODAY Order to Stay the Execution Granted to Defendant by Another Justice New York, Nov. 24.-William J. Cummins, the Nashville, Tenn., bank-er, head of the suspended Carnegie Trust company of this city, recently convicted of the theft of $140,000 from the trust funds held by the Carnegie company, was today sentenced by Justice Davis in the supreme court to an indeterminate term in state prison of from four years and eighteen months to eight years and eight months. Immediate!" after sentence was passed counsel for Cummins moved for an arrest of judgment pending an appeal. The motio: was denied. The defendant's counsel then went before Justice Seabury of the supreme court and obtained an order directing the district attorney to show cause why a certificate of reasonable doubt should not issue. The order is returnable Monday.

21. December 1, 1911 Milford Chronicle Milford, DE
Article from Milford Chronicle, December 1, 1911

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Prison Term For Cummins. William J. Cummins, the Nashville banker and the head of the suspended Carnegie Trust company of New York, convicted of the theft of $140,000 from a trust fund held by the Carnegie company, was sentenced to an indeterminable term in the state prison of four years and eight months to eight years and eight months.

22. January 10, 1912 Tonopah Daily Bonanza Tonopah, NV
Article from Tonopah Daily Bonanza, January 10, 1912

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THIEVING BANKER PROMISES TO PAY DOLLAR-FOR-DOLLAR CONVICTED OFFICIAL OF DEFUNCT COMPANY ISSUES A STATEMENT. NASHVILLE, Tenn., Jan. 10.William J. Cummins, convicted in New York of grand larceny in connection with the failure of the Carnegie Trust company, but now in Nashville, trying to clear up some of his financial matters, yesterday gave out a statement in which he said the Carnegie Trust company would pay out dollar for dollar. "I never intend to quit until my friends and the public know that I was the victim of circumstances, controlled entirely by two elemen - Wall street and politics," he declared. Cummins was accompanied here by E. Wright Wilson, a New York lawyer. "We owned over $5,000,000 bank stocks which cost us that amount of money," said Cummins, "and in addition owned $5,000,000 industrial stocks. The statement that my real 0 estate in Tennessee was mortgaged for $29,000 is false. There never was but $15,000 mortgage, and this has been paid by the receiver in charge, so there is now no mor gage at all." He said the schedule showing $4.000,000 liabilities did not state tha over half of that amount was ow to Andrew Carnegie and that Mr. Carnegie was secured by the st held as collateral.

23. November 12, 1912 The Topeka State Journal Topeka, KS
Article from The Topeka State Journal, November 12, 1912

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# TO BUILD A STUBBS ROAD SOON. Cherryvale, Oklahoma & Texas Planned by Kansas Governor. Oklahoma City, Okla., Nov. 12.-As a result of the decision of Judge Pollock in the federal court, giving judgment to the promoters of the Cherryvale, Oklahoma & Texas railroad, against its French financial agents for $480,000, claimed to have been fraudulently withheld, it is announced by President Porter and General Manager Brewster that work on the road will be resumed in the near future. The original plans for the road were made many years ago by Senator Porter and W. R. Stubbs, now governor of Kansas, who was defeated last week for the United States senate. The line was to run from Caney, Kansas, to El Paso, with a branch southeast from Caney into Arkansas. Failing to get the requisite financial backing in this country, Porter went to France and, after many difficulties, arranged for the sale of the bonds of his road. He returned and commenced construction work, completing the Arkansas branch most of the way from Caney to Nowata, Okla. Then the Carnegie Trust company of New York, trustee for the French bankers, suspended and tied up the work for some time. After its affairs were straightened out, it was found that the Paris

24. November 20, 1912 The Bridgeport Evening Farmer Bridgeport, CT
Article from The Bridgeport Evening Farmer, November 20, 1912

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TRIAL OF HYDE FOR FORCING BANK LOANS BEGINS New York, Nov. 20-After a delay of more than a year. the trial of Charles Hiram Hyde, former city chamberlain, charged with having used his office to force loans from the Northern bank to the Carnegie Trust Co., before the latter concern went into the hands of a receiver, began before Jastice Goff in the supreme court, today. The indictment alleges that Hyde compelled Joseph D. Robin, then president of the Northern bank, to loan $100,000 to the Carnegie Trust Co., on Aug. 22, 1910. In return for this, Hyde made the Northern a depository. As soon as the trial was moved by District Attorney Whitman, John B. Stanchfield, of counsel for Hyde, moved that the indictment be dismissed on the ground that the court had no jurisdiction. The motion was promptly deniea and the selection of a jury from the special panel of 30 was begun. Hyde is being defended by Stanchfield and Max D. Steur, while Diatrict Attorney# Whitman, Chief Amistant Frank Moss and John K Clark a in charge of the prosecution,