1.
June 12, 1914
The Fargo Forum and Daily Republican
Fargo, ND
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LORIMER BANKS ARE CLOSED UP Chicago, June 12. - The LaSalle Street Trust & Savings bank of which former Senator William Lorimer is president was taken in charge by the state bank examiner. No business was done in the bank today. The examiner reported that conditions were such as to warrant the closing of the bank. A mild run on the bank was started two days ago, according to the secretary of the bank, today more and more depositors gathered in front of the institution which is a few doors from the board of trade building in LaSalle street. An hour after the arrival of the state bank examiner, doors of the bank closed. An examination of subsidiaries of the LaSalle Street bank, it was announced, will be taken up by the bank examiner. Lorimer, president of the bank. was in conference with the directors of the institution through the morning. Later, the state bank examiners caused a suspension of business in three subsidiaries of the La Salle street institution. These were the Broadway State bank on the north side, the Ashland bank on the west side in the ghetto district, and the Illinois State bank of Chicago, on North Clark street. The Broadway State and Ashland banks were organized within a year. In financial circles it is reported that the Corn Exchange bank yesterday refused to allow the La Salle street institution to clear through it. A rough estimate of the amount withdrawn by depositors is $1,000,000.
2.
June 12, 1914
Evening Times-Republican
Marshalltown, IA
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RUN ON LASALLE STREET TRUST AND SAVINGS PRECIPITATES CRISIS. CLOSED UPON ORDER OF STATE EXAMINER Announces Condition Is Such as to Warrant Cessation of BusinessSubsidiary Institutions to Be Examined at Once to Determine Condition -Capital Stock of $1,000,000. Chicago, June 12.-The LaSalle Street Trust and Savings Bank, of which former Senator William Lorimer is president, was taken in charge today by the state bank examiner. No business was done in the bank today and the examiner reported that conditions were such as to warrant the closing of the bank. An hour after the arrival of the state bank examiner the doors of the bank were closed. Examination of subsidiaries of the L Salle street bank, it was announced, would be taken up by the state bank examiner. Run Precipitates Trouble. William Lorimer, president of the bank, was in conference with the directors of the institution thru the morning. In the last statement issued by the bank its capital stock was placed at $1,000,000, with a surplus of $250,000, and undivided profits of $93,631. Its stock was then held at par. A mild run started on the bank two days ago, according to the secretary of the LaSalle Street Trust and Savings Bank, and today more depositors gathered in front of the institution, which is a few doors from the board of trade building in LaSalle street.
3.
June 12, 1914
Evening Capital News
Boise, ID
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LORIMER'S BANK TAKEN IN CHARGE BY THE EXAMINER La Salle Street Savings and Trust Bank Closes Its Doors - Examination Is Being Made. Chicago, June 12.-The La Salle Street Trust and Savings bank, of which former United States Senator William Lorimer is president, was taken in charge today by the state bank examiner. No business was done in the bank today. The examiner reports conditions : uch as to warrant the closing of the bank. Lorimer was in conference with the directors of the institution today. An examination of the subsidiaries will be taken up by the state examiner. A mild run has been made on the bank for two days and more depositors gathered in front of the institution today. The last statement issued by the bank showed the capital stock placed at $1,000,000 with $250,000 surplus and undivided profits of $93,000. The stock was then held at par. The statement gave the deposits as $5,000,000 and loans at $4,000,000. The examiners later, caused the suspension of three local banks classed as subsidiaries. It is reported the Corn Exchange bank yesterday refused to allow the La Salle Street Trust and Savings bank to clear through it. It is reported that runs in the past three weeks have caused withdrawals of more than $1,000,000.
4.
June 13, 1914
The Wheeling Intelligencer
Wheeling, WV
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FOUR LORIMER BANKS CLOSED STATE BANKING DEPARTMENT ACTS AND MAY ASK FOR RECEIVERSHIP. Chief Examiner Takes Personal Charge of Largest Bank- May Re-open Next Week. CHICAGO, June 12-Four state banks. the most important having for its president William Lorimer. unseated from the United States Senate, were closed by the state bank ing department here today. Representatives of the department immediately began a close examination into the institutions' affairs. Rumors are current that a receivership will be asked. The four banks were the La Salle Street Trust & Savings Bank. the Broadway State bank. the Illinois State Bank, and the Ashland Twelfth State Bank, known as the LorimerMunday chain of banks. The La Salle Street Bank was the main Institution, the others being outlying concerns whose balances and reserves were carried to a great extent by it. Combined they have deposits of $6.411,997 $1,434,692. and reported cash means of Of their deposits $966,000 consists of city funds. The bulk of this amount $650,000 is on deposit with the La Salle Street Trust and Savings bank. The sanitary district of Chicago has $75,000 in the La Salle Street bank. Open Next Week. Chief bank Examiner Daniel Harkin who took personal charge of the down town bank and sent deputies to the smaller ones said late today that he expected to see the La Salle St., Trust and Savings bank open for business next week. He declared that he sent examiners to the smaller institutions as a precautionary measure. He insisted that there was no polltical phase to the action of his department. An examination of the La Salle Street Trust and Savings bank by Harkin two months ago disclosed. be said, a quantity of what he regarded as slow assets. The bank officials are said by state officials to have pleaded for a little time in which to change that condition. Mild Run on Bank. In the last three weeks. according to Examiner Harkin and the cashier of the bank. there has been what was termed a mild run on the bank. causdeposits. ing a depletion of about $1,000,000 in Former United States Senator Lorimer, president. and C. B. Munday, vice president, situation. refused to comment on the James B. Forgan, president of the First National Bank. and chairman of the clearing house committee. said: "The closing of the LaSalle Street Trust & Savings Bank should not have the slightest effect upon any other banks in the Chicago district."
5.
June 13, 1914
The Sun
New York, NY
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SIONITH NI OTHERS MAY BE INVOLVED Deposits of $8,000,000 Said to Be. Tied Up in Tangle. CITY AND CHARITABLE BODIES ARE HARD HIT Ex-U. S. Senator Head of Parent Concern-Many Politicians Are Stockholders. CHICAGO. June 12.-It is believed here that criminal prosecution may follow the closing to-day by examiners of the La Salle Street Trust and Savings Bank. of which ex-United States Senator William Lorimer is president. and three associated banks. Chief Bank Examiner Harkins and a score of assistants are busily engaged in trying to unravel the financial tangle which resulted in a run on the La Salle Street bank. Mr. Harkins said it would be several days before the actual state of affairs is known. In round numbers the combined deposit liabilities aggregate between $6,000,000 and $8,000,000. The La Salle Street Trust and Sav. ings Bank is a State institution located in the heart of the downtown district. It was established originally as a national bank by ex-Senator Lorimer. Neither it nor its predecessor has ever been a member of the Clearing House. The three other banks are located in the outlying districts and are known as neighborhood banks. All of them carried their balances at the La Salle Street institution and were controlled by officlais of the downtown Lorimer bank. of More Banks May Close. An immediate result of the closing of u the four banks to-day in all probability P will result in two more outlying banks in Chicago failing to open to-morrow. a Seven down-State banks are affected by P interlocking directorates and the tying up a of bank balances. carried by the Lorimer main bank. The State Bank Examiner to-night would express no opinion as to 0 the probable fate of these down-State inu stitutions. 1 The members of the Clearing House .1 declare that the action taken by the State O Bank Examiner had no direct bearing on O the banking situation of this city, which B is declared to be perfectly sound. S Leading Chicago bankers say they have considered the Lorimer bank a sore spot in the local financial horizon for some time. The La Salle National Bank
6.
June 13, 1914
Bismarck Daily Tribune
Bismarck, ND
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BILL LORIMER BANK CLOSED FOR REPAIRS CHAIN OF CHICAGO INSTITUTIONS TAKEN IN CHARGE BY EXAMINER. MILD RUN FOR A WEEK Chicago, III.. Juhe 12.-Four state banks in Chicago, with aggregate deposits of $6,411,997 and reported cash means of $1,434,692, were taken in charge today by the state banking department, which closed the bank's doors to begin a close examination of their affairs. The four were: The LaSalle Street Truss and Savings bank. the Broadway State bank, the Illinois State bank and the Ashland-Twelfth State bank, known in financial circles as the Lorimer-Munday chain of banks. Lorimer's Banks. The LaSalle Street Trust and Savings bank, the president of which is William Lorimer, who was unseated from the United States senate, is the main institution, the three others being outlying banks, whose balances and reserves were carried to a great extent by the LaSaile Street bank. Chief Bank Examiner Harkin said he expected to see the LaSalle Street bank open for business next week. He insisted there was no political phase in the closing of the banks. For the last three weeks, it is said, there has been a mild run on the main bank.
7.
June 13, 1914
The Pensacola Journal
Pensacola, FL
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BY ASSOCIATED PRESS. Chicago, June 12.-The La Salle Street Trust and Savings Bank, organized by William Lorimer five years ago when he was United States senator from Illinois, and of which he has since been president, was closed today by the state bank examiner. While rumors of financial trouble had been whispered of late, the actual closing of the institution was a surprise. Coincident with this action examiners closed three state banks which had heavy deposits with the larger institution. No statement of what the closing of the La Salle Street Bank actually means in dollars was made by the examiner. Recent reports to the state auditor's office placed the deposits at more than $5,000,000. For the last three weeks, according to officials, there has been a mild run on the bank
8.
June 13, 1914
Arizona Republican
Phoenix, AZ
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EXAMINER CLOSES CHAIN OF LORIMER BANKS Four Institutions With Deposits More Than $6,000,000 Are Suspended [ASSOCIATED PRESS DISPATCH] CHICAGO, June .-Four state banks in Chicago, with aggregate deposits of more than $6,000,000 and reported cash means of $1,400,000 were taken in charge by the state banking department which closed the banks doors and began an examniation of the banks affairs. The four are the La Sallee Street Trust & Savings; The Broadway State: The Illinois State and the Ashland-Twelfth State banks. known in official circles as the Lorimer-Munday chain of banks. An examination of the La Salle Street Trust & Savings bank by Harkin two months ago, disclosed, he said, a quantity of what he regarded as slow assets. The bank officials are said by state officials to have pleaded for a little time in which to change that condition. In the last three weeks, according to Examiner Harkins also the cashier of the bank, there has been what was termed a mild run on the bank, causing a depletion of about $1,000,000 in deposits. The La Salle Trust & Savings bank, the president of which is William Lorimer, unseated from the United States senate, was the main institution, the three others being outlying banks whose balance and reserves were carried to a great extent by the La Salle street bank. Chief Bank Examiner Daniels Harkin said tonight he expected to see the La Salle Trust & Savings open for busines next week. He declared that he sent the examiners to the smaller institutions as precautionary measures. He insisted there was no political phase in closing the banks. U
9.
June 17, 1914
Rock Island Argus
Rock Island, IL
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Crowds about the LaSalle Street Trust and Savings Bank after it was closed, and its president, former Senator Lorimer. bank in Chicago has included the ormanufacturing. Bonds and securities Chicago, Ill., June 17.-Assurances of these various concerns were ganization of several small neighborby C. B. Munday, in financial hood banks, whose deposits and balstuffed into the strong box of the ontrol of the LaSalle Street Trust ances remained with the downtown LaSalle Street Trust and Savings Savings bank, and by William bank. bank. Much of the good assets of "The situation was further comLorimer, its president, that the instithe bank were hypothecated or sold ution will yet be saved from wreck, plicated," said the banker, "by the to meet the speculative crisis in the aroused confidence in the deposismall banks lending money to the Munday affairs. who late last week, when the enterprises with which Munday has Last April he was notified to rebeen connected. He was the domiiclosed its doors, believed their place the "slow" assets with some nant figure at the bank so far as the avings had been swept away. live ones. Evidently this was a difThe scandal in the state auditor's other bankers of Chicago had any ficult job. The run following the ffice caused the crash in the Munrelationship with the bank. Brady scandal forced the action. The bank was not a member of the "Thus when the jam comes the ay-Lorimer banks last week. State small banks are unable to realize on auditor James J. Brady was sued, Clearing House association, and their commercial paper, the central breach of promise by Mrs. Louise though it frequently applied for adbanks is unable to realize either on its Kuhns, whom he had married coinmission, the application was as freto the state law. The suit led own paper, loaned to the same comquently denied. mercial or industrial enterprises, or charges that the office was conA member of the clearing house ucted for the benefit of spoilsmen. the small banks' paper, and we have said: "Just prior to the ejectment of William Lorimer from the United was charged that the LaSalle bank a failure. That whole plan is what ontributed $2,500 to the Brady camwe call kindergarten banking. An States senate on charges reflecting fund. on his election the LaSalle Street overland of bad paper." For months it had been known The failure of a trolley running National bank was organized. Lorifrom East St. Louis loaned Mr. Munmer stated at that time that he mong bankers that the LaSalle treet bank was a "lame duck." At day with $500,000 in bonds for which hoped to found a business for his last examination it was found no market could be found. sons. This afterward became the the bank had been loaded down When the LaSalle National was orLaSalle Street Trust and Savings "dead" paper. ganized hundreds of state and city bank. Since then I should say that Besides his banks, Munday was inLorimer has been a passive presipoliticians subscribed for the stock rested in ten or twelve industrial at $125. They exchanged it when dent, and the management of the oncerns. These included a grain the bank was reorganized. Now they bank has been largely in the hands usiness, trolley line building and are thinking. of C. M. Munday. The policy of the
10.
June 24, 1914
The Pensacola Journal
Pensacola, FL
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PLANS OF INVESTIGATING ATTORNEYS ARE SUSPENDED Chicago, June 23.-Plans of State's Attorney MacLay Hoyne for the Investigation of the suspension of the LaSalle Street Trust and Savings Bank and others of the Lorimer-Munday string of state banks were brought to a halt today at least temporarily, today by the refusal of James J. Brady state auditor, to turn over to Hoyne a copy of the report of the Bank Examiner Daniel V. Harkin.
11.
June 24, 1914
Grant County Herald
Lancaster, WI
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BANK OPENED BY RECEIVER W. C. Niblack Takes Charge of LaSalle Street Trust & Savings at Chicago. Chicago, June 22.-William C. Niblack, receiver of the LaSalle Street Trust & Savings bank,' took possession of the institution and immediately the bronzed doors, closed since a week ago last Friday, swung open. The bank building will be open for six hours during the day from now on. This was determined by Mr. Niblack, who said he knew the 12,000 depositors who have money in the closed institution were anxious for information. This will be readily given by Mr. Niblack's assistants. Cashier Fox opened the vaults for the receiver and he then formally took possession.
12.
June 25, 1914
Perrysburg Journal
Perrysburg, OH
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Crowds about the LaSalle Street Trust and Savings Bank after it was close Lorimer. Chicago.- (Special) - Assurances facturing. Bonds and securities of given by C. B. Munday, in financial thees various concerns were stuffed into the strong box of the LaSalle control of the aSalle Street Trust and Street Trust and Savings bank. Much Savings bank, and by William Loriof the good assets of the bank were ner, its president, that the instituhypothecated or sold to meet the specion will yet be saved from wreck, has ulative crisis in the Munday affairs. roused confidence in the depositors Last April he was notified to rewho late last week, when the bank place the "slow" assets with some live closed its doors, believed their savones. Evidently this was a difficult ngs had been swept away. The scandal in the state auditor's job. The run following the Brady scandal forced the action. ffice caused the crash in the MundayThe bank was not a member of the Lorimer banks last week. State AudClearing House association, and tor James J. Brady was sued for though it frequently appled for adreach of promise by Mrs. Louise mission, the application was as freKuhns, whom he had married conquently denied. rary to the state law. The suit led charges that the office was conA member of the clearing house lucted for the benefit of spoilsmen. said: "Just prior to the ejectment of William Lorimer from the United It was charged that the LaSalle bank contributed $2,500 to the Brady camStates senate on charges reflecting on his election the LaSalle Street Napaign fund. For months it had been known tional bank was organized. Lorimer stated at that time that he hoped to among banker sthat the LaSalle Street bank was a "lame duck." At found a business for his sons. This the last examination it was found afterward became the LaSalle Street that the bank had been loaded down Trust and Savings bank. Since then with "dead" paper. I should say that Lorimer has been Besides his banks, Munday was ina passive president, and the manageterested in ten or twelve industrial ment of the bank has been largely in concerns. These included a grain busthe hands of C. B. Munday. The poliness, trolley line building and manuicy of the bank in Chicago has in-
13.
June 27, 1914
Iron County News
Hurley, WI
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State Attorney Maclay Hoyne of Chicago appointed assistants to take charge of the criminal prosecution of former Senator William Lorimer, C. B. Munday and the other wreckers of the LaSalle Street Trust & Savings bank. Evidence indicates that deposits were received after Lorimer and Munday knew the bank was insolvent. W. C. Niblack, vice-president of the Chicago Title & Trust company, was appointed receiver of the bank.
Grand Rapids's most baffling murder mystery, the Thompson triple tragedy, when gunmen killed Ed Smith, J. N. Thompson and Paul Townsend, receiving $2,200 worth of diamonds, was cleared by an alleged confession made by Walter "Vepper" Lawrence to Prosecutor Phelps.
Fire which for a time threatened the entire city destroyed half of the business section of McClure, O., a town of 2,000 inhabitants. The loss was $70,000.
14.
June 30, 1914
The Day Book
Chicago, IL
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# WHAT THE COUNCIL DID
Passed an order requesting Judge Windes to force the receiver of the LaSalle Street Trust and Savings Bank to furnish the finance committee with information that would disclose who received the split interest paid by the bank on city money.
Passed an order regulating booths in saloon back rooms. Partitions must be so low that unobstructed view can be had of interior.
Ousted George Weston as city's representative on board of supervising engineers, charged with regulation of local transportation. Weston blamed for bad service, but some aldermen also censured the mayor for delaying action for two years.
Passed order to expend $1,000,000 in improving police stations and $500,000 for fire houses.
Proposed ordinance to allow erection of buildings on Michigan avenue 260 feet high sent to building committee.
15.
July 7, 1914
Omaha Daily Bee
Omaha, NE
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Receivers Asked for Three Other Banks in Lorimer Chain CHICAGO, July 6. Receivers were asked for three of the lesser of the Lorimer-Munday string of banks today. These banks closed with the failure of the parent bank, the LaSalle Street Trust and Savinsg bank. They are the State bank of Calumet, the Illinois State bank of Chicago and the Ashland-Twelfth State bank. The application was made by William Freeman, attorney for certain depositors. It is alleged that no one is now in possession of the properties. It is charged that $75,000 of city deposits alloted to the Calumet bank and smaller city deposits allotted to the other two branch banks never reached them, but were deposited in the LaSalle Street bank. It is further alleged that certain stockholders in the banks never paid for their stock, Assessment of stockholders under the double liability act is required.
16.
July 9, 1914
Perrysburg Journal
Perrysburg, OH
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came a state institution, with Paynter's balance due dumped into the state bank, as shown by accountants for Receiver Niblack, have found the following figures:
June 2, 1913—Paid $4,477.97.
September 10, 1913—Paid $7.500.
Also $88.42.
November 3, 1913—Paid $5,000.
May 25, 1914—Paid $10,000.
June 2, 1914—Paid $2,083.61. This balanced the original account and wiped the slate clean. On the same day, however, Paynter borrowed a fresh $2,676.45. This was ten days before the bank closed. This amount is still unpaid. In his statement Mr. Paynter said it will be paid on demand.
District Attorney Wilkerson's investigation of the LaSalle Street Trust & Savings bank promises to be one of the most thorough inquiries ever conducted into a national bank scandal. Assistant District Attorney Joseph B. Fleming and Garfield Charles and Special Agent Hiram Kadish, an expert bank accountant, are in charge of the work of inspecting the bank books, gathering evidence of alleged misappropriation of funds, and are preparing a record for grand jury action.
17.
July 16, 1914
The Review
High Point, NC
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Receiver for Lorimer Banks. Chicago.-Receivers were asked for three of the Lorimer-Munday string of small banks. These banks closed with the failure of the parent bank, the LaSalle Street Trust and Savings bank.
18.
July 16, 1914
The Commonwealth
Scotland Neck, NC
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Receiver for Lorimer Banks. Chicago.-Receivers were asked for three of the Lorimer-Munday string of small banks. These banks closed with the failure of the parent bank, the LaSalle Street Trust and Savings bank.
19.
August 19, 1914
The Day Book
Chicago, IL
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HOPE TO OPEN LASALLE BANK At a meeting held in the offices of W. C. Niblack, receiver for the LaSalle Street Trust and Savings Bank, yesterday a proposition to close up the receivership of the bank and to re-open it with new officers and directors was made. It was decided to ask Att'y Gen. Lucey and State Auditor Brady to make a fifty per cent assessment on the capital stock of the bank and then allow its opening. Mr. Munday and his friends insist
20.
January 21, 1915
The Idaho Recorder
Salmon, ID
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# Depositors Will Lose.
Chicago. — The defunct La Street Trust & Savings bank, of William Lorimer was president be lucky to pay 42 per cent outstanding liabilities, according testimony given by William C. Ni receiver for the bank, in an action its dissolution brought by State tor Brady.
21.
April 9, 1915
Americus Times-Recorder
Americus, GA
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FORMER SENATOR LORIMER MUST ANSWER CHARGES BANK WRECKING (By Assoiated Press. CHICAGO, III., April 9.-William M. Lorimer, former United States senator from Ililnois, and other officials of the defnuct LaSalle Street Trust and Savings Bank, must stand trial on charges of conspiring to wreck that institution, under a d'ecision rendered in the criminal court today. A motion on behalf of the defendants to quash the indictment was overruled after arguments were submitted. Lorimer first attained notoriety several years ago when h ewas ousted from the senate after charges of coreral years ago, when he was ousted by an investigating committee, and since then has been much in the public eye. He was formerly looked upon as the republican political "boss" of this state, and was at the head of 2. chain of banks extending into almost every community of size or influence in Illinois. The LaSalle Street Trust and Savings Bank was the parent institution of numerous smaller banks, nearly all of which went into liquidation after the Chicago institution closed its doors. Losses running into many millions are alleged to have been sustained through the failure, and investigation of the affairs of the LaSalle Street bank, it is stated, revealed startling evidence of fraud and corruption among the officials.
22.
February 17, 1916
Bisbee Daily Review
Bisbee, AZ
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sidiary banks closed. The Munday down-state banks later felt the effect of the collapse of the La Salle Street Trust and Savings Bank and they also were closed. June 19, 1914, the Chicago Title and Trust Co., was appointed receiver for the La Salle Street Trust and Savings Bank. Receivers also were named for central of the subsidiary banks. Meanwhile the United States District attorney and the state's attorney of Cook County had begun an investigation of the bank's affairs. Numerous business enterprises of William Lorimer and Charles B. Munday followed the bank into insolvency. Investigation showed that the greator proportion of the La Salle Street Trust and Savings Bank assets was made un of loans to enterprises in which Lorimer, Munday and Harry W. Huttig were interested. As a result of these investigations indictments were returned against Lorimer, Munday, Huttig and others by both federal and state grand juries. The federal indictments were rushed through in the 'summer of 1914 in order to get within the statute of limitations, for these charges were based on the operation of the bank prior to its conversion into a state institution, on October 22, 1914. The bulk of the state indictments were returned by the Cook I County grand jury Oct. 21. 1912. These were against Lorimer, Munday, Huttig and other officers and employees of the bank and former officials of the state auditor's office. The fourteen persons named in the indictments were alleged to have loot. ed the Lorimer-Munday institutions of nearly $2,500,000, with violations of practically every banking law in the state.
23.
May 3, 1916
Rock Island Argus
Rock Island, IL
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LANDIS ASKS PROBE OF SURETY COMPANY Chicago, May 3. --- Federal Judge Kenesaw M. Landis has requested United States Attorney Charles F. Clyne to investigate the alleged neglect of the Illinois Surety company, which recently applied for and obtained a receivership in the superior court of Cook county, to make good a $50,000 surety to the federal government covering deposits in the defunct La Salle Street Trust and Savings bank, and to make good a surety for a like amount in a large number of Chinese cases. Attorney General Lucey yesterday asked Superior Judge D. E. Sullivan to remove James Hopkins from the receivership to which he has been appointed and name a new receiver.
24.
May 5, 1916
The Washington Herald
Washington, DC
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LORIMER TO RUN AGAIN. First to Pay Bank Depositors, Then Seek Senate Seat. Chicago, May 4.-William Lorimer is again a candidate for the United States Senate. Acquitted last midnight of charges of embezzlement and conspiracy, in connection with the collapse of the La Salle Street Trust and Savings Bank, of which he was organizer and president, the ousted United States Senator today began to whip his business affairs into shape pre-
25.
July 8, 1916
Rock Island Argus
Rock Island, IL
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# BANK HELD LIABLE
# IN LORIMER DEAL
Circuit Court Judge Smith Renders
Decision Against Central Trust
Company for $1,250,000.
Chicago, July 8.—A decision making the Central Trust company of Illinois, a Chicago bank, liable for $1,250.000, with interest from Oct. 21, 1912, in connection with the failure of the La Salle Street Trust and Savings bank, was handed down today by Judge Frederick A. Smith in the circuit court. On the date mentioned, the La Street institution changed from a national to a state bank. According to testimony William Lorimer, its president, to comply with a law requiring that the capital and surplus of a state bank must be paid in cash, then asked Charles G. Dawes, president of the Central Trust, to cash a check for $1,250,000.
This, according to the testimony, Mr. Dawes agreed to do and the Central Trust cashed the check, drawn on the La Salle Street National bank. The money was given to Mr. Lorimer and he turned it over to the state bank examiner, who gave it back to Mr. Lorimer with a certificate of the bank's incorporation as a state bank. Mr. Lorimer then returned the money to the Central Trust and received his check, and the La Salle Trust and Savings bank was organized.
This transaction, Judge Smith held illegal and on it held the Central Trust company liable. The suit against the Central Trust was brought by William C. Niblack, receiver for the Lorimer bank.