State Bank - Chicago, IL

Bank Information

Episode Type: Run → Suspension → Closure
Bank Type: state
Start Date: August 7, 1906
Location: Chicago, Illinois (41.850, -87.650)

Metadata

Model: gpt-5-mini
Short Digest: 517ca851

Response Measures

Full suspension, Books examined

Other: Receivership/closure followed suspension; president fled and was arrested abroad.

Description

Articles (early August 1906) report the State Bank on Milwaukee Avenue (Chicago) was closed by State Bank Examiner C.C. Jones after discovery of large shortages (embezzlement/speculation). A clamorous crowd tried to rush the doors on announcement of the suspension; officers fled and cashier disappeared. The bank was placed in hands of the state auditor/examiner and did not resume — treated as a failure. Classified as run leading to suspension and closure due to bank-specific adverse information.

Events (3)

1. August 7, 1906 Receivership

Newspaper Excerpt: the institution ... was in the hands of the state auditor. ... the bank was closed ... members of the clearing house committee were told that most of this amount was unprotected by adequate collateral. The Stensland family owned much of the bank stock. (closure and state control following suspension).
Source: newspapers

2. August 7, 1906 Run

Cause: Bank Specific Adverse Info
Cause Details: Announcement of the bank's failure/shortage (embezzlement/speculation) led depositors to clamor and attempt to rush the bank.
Measures: Police sent to keep order; depositors allowed to file past doors; only safety deposit keyholders admitted.
Newspaper Excerpt: Riotous scenes attended the announcement of the failure ... a large excited crowd struggled ... to rush the doors of the institution.
Source: newspapers

3. August 7, 1906 Suspension

Cause: Bank Specific Adverse Info
Cause Details: Examination revealed a deficit of roughly $750,000–$1,000,000 due to speculation and alleged embezzlement (cashier disappeared; warrant issued).
Newspaper Excerpt: The bank ... was closed by State Bank Examiner C.C. Jones. ... a notice ... stating that business had been suspended for the purpose of making an examination of the bank's affairs and that the institution was in the hands of the state auditor.
Source: newspapers

Newspaper Articles (5)

1. August 3, 1906 Watertown Weekly Leader Watertown, WI

Article from Watertown Weekly Leader, August 3, 1906

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Article Text

Nine companies suffered no loss. I CHICAGO, III.. July 30.-Byron Smith resigned yesterday as receiver of the Traders' Fire of Chicago and the court appointed the State Bank of Chicago as his successor. 11. A. Haugan, the president of the bank. will be the active man in the handling of the affairs of the company. When Mr. Smith accepted the receivership early in May it was with the belief that he might be able to assist in a settlement. All hope of that apparently has been abandoned, and Mr. Smith was no longer willing to take SO much of his time from his duties as president of the Northern Trust company as the receivership required.

2. August 3, 1906 Eagle River Review Eagle River, WI

Article from Eagle River Review, August 3, 1906

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Article Text

Nine companies suffered no loss. CHICAGO, Ill.. July 30.-Byron L. Smith resigned yesterday as receiver of the Traders' Fire of Chicago and the court appointed the State Bank of Chicago as his successor. H. A. Haugan, the president of the bank, will be the active man in the handling of the affairs of the company. When Mr. Smith accepted the receivership early in May it was with the belief that he might be able to assist in a settlement. All hope of that apparently has been abandoned, and Mr. Smith was no longer willing to take SO much of his time from his duties as president of the Northern Trust company as the receivership required.

3. August 7, 1906 The Bennington Evening Banner Bennington, VT

Article from The Bennington Evening Banner, August 7, 1906

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BIG CHICAGO BANK FAILS Defecit Said to Reach Nearly a Million. SPECULATION THE CAUSE Officials Have Fled and One Ruined Depositor Has Committed Suicide. CHICAGO, Aug. 7.-With a deficit in its accounts of close to $1,000,000 and with the whereabouts of two of its chief officers unknown to the authorione banks ties, bank. the of Milwaukee the larger outlying Avenue State in Chicago, was closed by State Bank Examiner C.C. Jones. The bank had deposits amounting to about $4,000,000 and loans and credits to about the same sum. The failure was responsible for the death of one of the depositors and led a ago the of to month the suicide _had of placed another man earnings who a lifetime in the institution. In the excitement following the announcement of the failure J. G. Visser, an of ficer of the Royal league, who had on deposit in the bank funds of that organization, fell dead. Henry Koepke, a grocer, on hearing that the bank had suspended payment, went to the rear of his store and shot himself. He died a few minutes later. Riotous scenes attended the announcement of the failure, and a large to an keep force of policemen excited crowd struggled of depositors, all day nearly all of whom were foreigners and many of whom were women, from rushing the doors of the institution. The fact that the bank was on the verge of failure was first revealed by the president of the institution, Paul O. Stensland, in a letter written from St. Paul to his son Theodore, who is vice president of the bank. The letter was received last Saturday, and it started the investigation which brought about the suspension. Cashier Henry W. Herring has disappeared, and a warrant has been issued for his arrest on a charge of embezzlement. The first public intimation that the bank was in trouble was the posting of a notice at the beginning of banking hours by Bank Examiner C. C. Jones stating that business had been suspended for the purpose of making an examination of the bank's affairs and that the institution was in the hands of the state auditor. The news spread rapidly throughout the a where entire the bank northwest had been side of for the years city, popular depository for funds saved by working people. Soon a clamorous crowd gathered before the doors and demanded admission. Anticipating trouble, a score of policement were sent to the bank. The people were permitted to file past the doors bearing the posted notice and were compelled to keep moving Only those having keys to safety deposit vaults were allowed to enter. Many burst into tears when they found that their savings were endangered, After receipt of the letter from President Stensland and acting on instructions contained therein, Vice President Theodore Stensland opened a deposit box and discovered proofs that the bank's funds were in bad shape. President Potter of the American Trust and Savings bank, which acted as clearing agent for the defunet institution, was called into consultation. The state auditor was informed. and he sent Bank Examiner Jones to make a full investigation The shortage of between $750,000 and $1,000,000 is said to be due to speculation in real estate and in the security market. Members of the clearing house committee were told that most of this amount was unprotected by adequate collateral. The Stensland family owned much of the bank stock.

4. August 20, 1906 Alexandria Gazette Alexandria, VA

Article from Alexandria Gazette, August 20, 1906

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Article Text

News of the Day. their Twelve persons New York lost yearerday. about bathers. waters victims were Tangle, who Satursecond of the Hitchcock's Handie Republic $11,000 one F. R. in the Saratoga Great BarStakes, day, won the mile and a quarter, Col, Sugar atoga. A William dispatch L. from Petrikincompany Denver, secretary estimated out a crop that the Great Western that the Colorado for this more of the season statement ugar beet is $10,000,000. than last in year's This $1,683,127 to the farmers. and declaring if brought Flourishing kill a Paul revolvestensland o. led a mob of the wrecked she would find him, a woman on the doors State Bank in Chicago Saturday. strong could in ilwaukee charge Avenue Balked in her and she turned delivered effort to enter, to the crowd. a harangue W. Hauback, he of Fauquier Remployed county, of who says B.L. City canvasser Va., B. by was that taken Umberger, yesterday to the morning the cord, pital Va. in with Baltimore painful of bruises the back> about Hau- Censuffering contusion Northern tral Railroad body back and was a walking track on when the he by train. and col golicitor lector Jefferson for Investment the T. defunct Mason, Company, Federal in Washing of Commer- Phila cial and was arrested with obdelphia, night, under false pre Friday money who charged jail too on under late Satur- his taining released from for tenses, was on $750 bond Court next Thursday, an airing. day appeaday, appearance afternoon when in the the Police will be given print Bookbindewashington in the government on threaten suspension office in account the Foreman ing on strike on Tanner by acting Members of Alvin Union of the deterAshton Bookbinders Saturday J. morning Local loreman a No. of the the action and have the effort directed have taken at themselvection radical in of Tanner mined upon the reinstatement taken by the Tuesday book to secure action will be meeting binders Final at a special the for boys Chicago, night. In a duel Miss between Oatherine two Canoon, Martin in night, fatally received 18 affections yearsold, Saturday of was his probably seconds, Charles that "Lucky" wound- will ed and one of wounds Hanson, Hanson, in his death. away by result was spirited been several companions The police. after probably the trouble, and has other not duelist, anhurt escaped by the double found William under 8. arrest, Sweeney, held for the shooting. and is Two boys were injured killed and yesterday, another to the probably fatally No. 1, belonging at Yreka, Cal., In powder house Company nearly every busi- were Grant was blown Powder up. in Yreka, of windows clothing indicate and Dess house Rembants on a hill parts broken. of bodies were found blown fired to atoms. into the that two boys the boys ventilator. powder is supposed house powder that through had 8 been stored in carload magazine of Saturday. France, Marseilles, rifle The police of an Italian anarchisi a bootmaker, arrested of Cirillo Francese, in plot bis of yesterday the name on suppicion. of being Fallieres Exposi were to lodgings of lead all of tion. to approaching When the police visit Francese's found screws 340 and grammes had other been searched bomb fulmingter accessories, 500 Italy. The which of arrest an anony was which brought from the receipt plot, mous wide lettermifications. name the result of denouncing the unknown, bad man, circus, The corpse with of John Robinson's track hand on employed found yeaterday division by a of the Western The near that the was Gettysburg Railroad man was Porters. murdered, Maryla think the several wounds by officers body contained had been made tied with his looked as if they hands were proba the knife. evidence that then placed twine, murdered The man's and he glayers had been to employe conceal on bly track by his the second railroad is within their crime. This to be killed was recently the circus Geil, col- red, of Harry at Laray. stabbed days. to death race riot at Seaford, men Del. There was 8 in which four a large seriously from of Saturday injured. night One Maryland section and Vir the her who went in looking of the with the State ginia of negroes handling for to work that peach connection crop with the involved in quarrel said, struck organcame The negro, it of the town of town 009. and the citizeus to run seen out on the ized and strange negroes the all The the ment, in resulted boy the proceeded negroes resented white Russell, treatof streets. and attacked William T. Md. Cumberland, and seriously which traveling galesman of Seaford, two colored temporary Icekup Linder Short, hurt. because the was filled jail town men being bad to be provided with prisoners. IN THE CHILI. the EARTHQUAKEING Chili, Dispatches received that Valparaiso, Chili, has one show of disof and, two days in fact, the greatest whole earthquake the

5. September 6, 1906 Gainesville Daily Sun Gainesville, FL

Article from Gainesville Daily Sun, September 6, 1906

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STENSLAND CAUGHT: BETRAYED BY WOMAN Sultan Will Surrender Fagitive to Authorities ATTORNEY OLSEN MADE ARREST Chicago Bank Wrecker Pursued to Other End of the World is Captur ed in Tangiers-Confessed Guilt to Chicago, Sept. 5.-A cablegram the Chicago Tribune from Tang Morocco, announces the capture that city of Paul O Stepsland president of the State bank, which closed No doors Aug. 6. The arrest was made a represent tative of The Tribune and Assistant State's Attorney Olsen of this city, who have been on the trail of St 118 land since Aug. 13. At the office of the state's attorney all information regarding the woman who had indirectly caused the arrest was refused It was announced that Assistant State Attorney Olsen bad. since embarking on the pursuit of Stensland, posing as the son of 01men," the named used by Stensland, declaring that he was auxious to overtake his "father who was traveling just ahead of him. Mr. Olsen had, since embarking on the pursuit of Stensland posing as the son of "Olsen. the name used by Stensland, declaring that he was anxtous to overtake his 'father'' who was traveling just ahead of him. As Stensland made no effort to conceal his trail. the following was not difficult. Paul Stensland's confession made Assersey - mystery Otsen: sur. clears-up much of the the events up involved The ruin crash rounding which leading of to took the the Milwaukee avenue bank He much of the blame upon himself. but declared Cashier Hering was the forger and that Hering got most of the money. He exonerated his son, The and the bank that he never odore, declared directors spent and more that He than $5,000 a year himself. all the money he stole he put into real estate with the nope of "making good." Stensland also said that he had made up his mind to flee on the third preceding the Sunday on which he left Chicago. All Wednesday night he wrestled with the problem to blow out his braine or run in the hours he decided to kill himthe act self, of darkness but postponed until the dawn, prtand with the sunlight came mal instinct to hold on to life. and flight won over death. His preparations were hurried He had surrendered his life insurance policy for had received $8,000 as comon the sale of the mission $5,000 and the property Northof the co-operative store to Life Insurance held a mortgage which westers had company. lien sat- on the premises. He drew $1,500 as any from the Mount Onive Cemetery association. This was all the money he had taken with him "Why, with a million dollars of cash in the bank. did you not take more?" "I could have taken a quarter of a million Jollars without trouble," said Be, "but I did not want to I never cent of cash from It in my own pocket. and took put one the I bank nor. or took a dollar belonging to other people." Stensland made no attempt to de as his guilt, and only tried to minimise IC: His confession began with . statement that be was surprised to learn that the total tom involved in the bank's failure would reach $2,000. eee. He said: "I canset understand how the shortage can be $2,000,000. To my certain knowledge, my liability to the bank done and exceed 2200,000 "My indebtednate Began a long time e 1926 It - a will amount at direct and God kcase never fatendof to steal a light hote and needed - and ⑉ own greene, not Surgery, in the This to as Class would stand