4402. Federal National Bank (Chicago, IL)

Bank Information

Episode Type
Suspension → Closure
Bank Type
national
Bank ID
7926
Charter Number
7926
Start Date
September 28, 1907
Location
Chicago, Illinois (41.850, -87.650)

Metadata

Model
gpt-5-mini
Short Digest
dc97ca28

Response Measures

None

Description

The bank suspended/wound up operations in late Sept/early Oct 1907 and did not resume. Newspaper accounts state it closed Sept 28, 1907 after a clearing house investigation and directors decided to wind up affairs. Later (Dec 4, 1907) a purchaser sued alleging fraud and doubtful assets. No mention of a depositor run; cause appears to be bank-specific bad assets/fraud uncovered.

Events (4)

1. September 28, 1905 Chartered
Source
historical_nic
2. September 28, 1907 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Investigation by clearing house committee found much paper of doubtful character, loans to bankrupt firms and jailed individuals; directors decided to wind up due to insufficient business and doubtful assets.
Newspaper Excerpt
It closed its doors September 28, 1907, after an investigation by the clearing house committee.
Source
newspapers
3. November 2, 1907 Voluntary Liquidation
Source
historical_nic
4. December 4, 1907 Other
Newspaper Excerpt
Declaring that he bought a gold brick when he purchased control of the Federal National Bank, John W. Worthington began action yesterday to have rescinded the contract of sale ... asks the court to compel Perry to return to him $40,000 and his notes for $140,000. ... much paper of a doubtful character was found in the bank and consequently it was forced to suspend.
Source
newspapers

Newspaper Articles (6)

Article from Rock Island Argus, October 2, 1907

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Article Text

FEDERALNATIONALSUSPENDS Chicago Bank Fails to Secure Enough Business to Pay Dividends. Chicago, Oct. 2.-Directors of the Federal National bank yesterday afternoon decided to wind up the affairs of the institution. An informal statement issued by the directors asserted all depositors will be paid in full upon demand. The reason assigned for suspending was the failure of the institution to secure sufficient business to warrant continuing. The bank was organized two years ago with a capital of $500,000. Deposits averaged $1 250,000. Its depositors were smail tradesmen.


Article from The Cairo Bulletin, October 2, 1907

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Article Text

CHICACO BANK TO SUSPEND BUSINESS WILL PAY DEPOSITORS, MOSTLY MEN OF MODERATE MEANS IN FULL ON DEMAND. Chicago. Oct. 1.-At a meeting of the directors of the Federal National bank here today it was ordered to wind up the affairs of the institution and suspend business. In a formal statement issued after the meating of the directors it was asserted that all depoistors will be paid in full upon demand. The reason assigned for the suspending was the failure of the institution to secure sufficient business to warrant continuing. The bank was organized two years azo with a capital of $500.000. The deposits averaged $1.000,000, and the depositors were chiefly men of moderate means.


Article from The Red Cloud Chief, October 4, 1907

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Article Text

Federal National Bank to Suspend. Chicago, Oct. 2.-At a meeting of the directors of the Federal National bank here, it was decided to wind up the affairs of the institution and suspend business.


Article from The Evening Star and Newark Advertiser, December 4, 1907

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Article Text

BANK A GOLD BRICK. DECLARES STOCKHOLDER. Purchaser of Control of Suspended Institution Wants Contract Rescinded. CHICAGO, Dec. 4.-Declaring that he bought a gold brick when he purchased control of the Federal National Bank, John W. Worthington began action yesterday to have rescinded the contract of sale between himself and Isaac M. Perry. Perry until the early part of August was president of the bank. Worthington avers that he was induced to purchase the controlling interest through fraud and misrepresentations made by Perry. The complainant asks the court to compel Perry to return to him $40,000 and his notes for $140,000. In his bill of complaint Worthington avers that Perry violated the Federal banking laws on more than one occasion. He also declared that much. paper of a doubtful character was found in the bank and consequently it was forced to suspend. Plaintiff says he found in the bank's assets notes securing loans given by firms which had gone into bankruptcy and by individuals who were in jail. The bank was organized in 1905 with a capital stock of $500,000. It closed its doors September 28, 1907, after an investigation by the clearing house committee.


Article from Evening Star, December 4, 1907

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Article Text

BANK A GOLD BRICK. Chicago Man Claims That He Was Buncoed. CHICAGO, December 4.-Declaring that he bought a gold brick when he purchased control of the Federal National Bank, John W. Worthington began action yesterday. to have rescinded the contract of sale between himself and Isaac N. Perry. Perry until the early part of August was president of the bank. Worthington avers that he was induced to purchase the controlling interest through fraud and misrepresentations made by Perry. The complainant asks the court to compel Perry to return to him $40,000 and his notes for $140,000. In his bill of complaint Worthington avers that Perry violated the federal banking laws on more than one occasion. He also declares that much paper of a doubtful character was found in the bank, and consequently it was forced to suspend. Plaintiff says he found in the bank's assets notes securing loans given by firms which had gone into bankruptcy and by individuals who were in jail. The bank was organized in 1905 with a capital stock of $500,000. It closed its doors September 28, 1907, after an investigation by the clearing house committee.


Article from Deseret Evening News, December 4, 1907

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Article Text

BOUGHT GOLD BRICK. J. W. Worthington Says that What He Got When Bought Fed. Nat'l Bank. Chicago, Dec. 4.-Declaring that he bought a gold brick when he purchased control of the Federal National bank, John W. Worthington began action yesterday to have rescinded the contract of sale between himself and Isaac N. Perry. Perry until the early part of August was president of the bank. Worthington avers that he was induced to purchase the controlling interest through fraud and misrepresentations made by Perry. The complainant asks the court to compel Perry to return to him $40,000 and his notes for $140,000. In his bill of complaint Worthington avers that Perry violated the federal banking laws on more than one occasion. He also declares that much paper of lubtful character was found in the bank and consequently it was forced to suspend. Plaintiff says he found in the bank's assets notes securing loans given by firms which had gone into bankruptcy and by individuals who were in jail. The bank was organized in 1905 with a capital stock of $500,000. It closed its doors Sept. 28, 1908, after an investigation by the clearing house committee.