4782. Union State Bank (Dixon, IL)

Bank Information

Episode Type
Suspension → Closure
Bank Type
state
Start Date
November 16, 1920
Location
Dixon, Illinois (41.839, -89.480)

Metadata

Model
gpt-5-mini
Short Digest
f149223e

Response Measures

None

Description

Bank closed in mid-November 1920 and a receiver was appointed; failure appears permanent (described as 'defunct' later and receiver handled settlement). Cause tied to alleged forgeries and huge worthless notes by former cashier E. J. Countryman (bank-specific adverse information). No article describes a depositor run prior to suspension.

Events (2)
1. November 16, 1920 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Bank closed after discovery that many promissory notes (largely those of former cashier E. J. Countryman) were alleged forgeries and assets were greatly overstated; resources estimated $136,000 less than liabilities.
Newspaper Excerpt
The bill of complaint ... asking the dissolution of the Union State bank of Dixon, which was closed two weeks ago, charges that the liabilities of the bank are so much in excess of the resources ...
Source
newspapers
2. November 29, 1920 Receivership
Newspaper Excerpt
Judge F. D. Stransky confirmed the appointment of J. U. Weyandt as receiver ... Jesse Weyant of Dixon has been named receiver of the Union State bank ... receiver Weyant of the defunct Union State bank of Dixon, whereby Sterling collected in full $15,000 of state funds ... the defunct bank was the only one ... which failed during Sterling's term ... (articles 1,2,8).
Source
newspapers

Newspaper Articles (8)
1. November 30, 1920 The Rock Island Argus and Daily Union Rock Island, IL
Article from The Rock Island Argus and Daily Union, November 30, 1920

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(Continued on Page Four). ASSESS STOCK OF DIXON BANK Seek Dissolution of Union State by Court Process-Notes Alleged to Be Forgeries. Dixon, Ill., Nov. 30.-The bill of complaint filed in the Lee county circuit court in behalf of the state of Illinois and Andrew Russel, auditor of public accounts, asking the dissolution of the Union State bank of Dixon, which was closed two weeks ago, charges that the liabilities of the bank are so much in excess of the resources of the bank that an assessment upon the stockholders will be necessary to pay all indebtedness to depositors, and further charges on information and belief that a large amount of the promissory notes appearing among the resources are forgeries. The bill charges "that among the resources appear certain promissory notes executed by, or the payment thereof assumed by E. J. Countryman, former cashier of said banking corporation, in excess of $130,000 at least $100,000 of which your orators believe to be worthless and uncollectable, the greater part of which are the forged notes of said E. J. Countryman." The report states the resources of the bank are so depreciated that they are worth at least $136,000 less than the total liabilities. Deposits in the bank were $408.171.72. In Lee county circuit court yesterday, Judge F. D. Stransky confirmed the appointment of J. U. Weyandt as receiver and named Harry Warner, John P. Devine and E. E. Wingert attorneys for the receiver.

2. December 7, 1920 The Rock Island Argus and Daily Union Rock Island, IL
Article from The Rock Island Argus and Daily Union, December 7, 1920

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BANK AT DIXON WILL BE AIRED Affairs of Union State to Be Investigated in Bankruptcy Court Next Thursday. Dixon, III., Dec. 7.-The affairs of former Cashier E. J. Countryman and the Union State bank of this city will be aired in bankruptcy court here next Thursday. Over half a million dollars is involved. and grand jury action against some of the parties to the suit may impend. Jesse Weyant of Dixon has been named receiver of the Union State bank in a petition filed by Andrew Russel. auditor of public accounts of Illinois. The affairs of the bank are in a deplorable condition. Forgery of notes in many cases is charged in the state's petition on file in the Lee county circuit court, and notes for large amounts. claimed by the signers to have been paid long ago, are turning up every day for collection by banks in Chicago, which hold them as collateral.

3. December 7, 1920 Free Trader-Journal and Ottawa Fair Dealer Ottawa, IL
Article from Free Trader-Journal and Ottawa Fair Dealer, December 7, 1920

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action against some of the parties to the suit impends. Jesse Weyant of Dixon has been named receiver of the Union State bank in a petition filed by Andrew Russel, auditor of public accounts of Illinois. The affairs of the bank are in a deplorable condition. Forgery of notes in many cases is charged in the state's petition on file in the Lee

4. August 24, 1921 Great Falls Tribune Great Falls, MT
Article from Great Falls Tribune, August 24, 1921

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In a letter accompanying the draft, Mr. Sterling explained this sum was "all the interest collected by me on state deposits since May 31, 1920." and that it included "interest to date on such collected interest items from the date when the same came to my hands." Explains in Letter. The letter further declared that this left only one unadjusted item, "namely, $15,000. deposited with the Union State bank of Dixon, Ill., for which deposit slip I hold collateral." Mr. Sterling pointed out that this bank was in the hands of a receiver and that he expected an adjustment soon, when he would turn over the amount received to the state treasurer. "Should I not be able to adjust this matter with the receiver in the very near future, I will pay you, in full, the amount of such deposit," the letter said. Mr. Sterling's letter to Mr. Miller also stated: "When, at the close of my term. I turned over the office of state treasurer, to you as my successor, I handed you a letter which read as follows: To Turn in Balance. " In turning over to you. as my successor. the office of the state treasurer of Illinois, I beg to formally advise you that when all interest collections have been made by me and I have learned from Washington the definite amount of interest due the federal government on trust funds kept by it with the state treasurer, during that portion of my term for which such interest has not yet been claimed and remains unpaid, I will turn in to you the remaining balance of the sum earned and received by me as interest on deposits of state funds during the period from May 31, 1920, to January 10, 1921."

5. August 24, 1921 The Rock Island Argus and Daily Union Rock Island, IL
Article from The Rock Island Argus and Daily Union, August 24, 1921

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d STERLING PAYS e STATE BIG SUM e FOR INTEREST a e Money Paid Treasurer Provokes Discussion. Springfield, Ill., Aug. 24.-Lieutenant Governor Fred E. Sterling, who yesterday made his final payment of interest earnings to State Treasurer Miller, arrived in Springfield today. He went to a hotel, had breakfast and declined to discuss either the payment or the embezzlement and conspiracy charges pending against him, Governor Small and Vernon Curtis, Grant Park banker. Lieutenant Governor Fred Sterling's action yesterday in turning over to the state treasurer $391.386.28 interest earnings on state money while he was state treasurer, today provoked much discussion at the capital. There was much speculation in particular on the effect this final accounting would have on the cases now pending against Sterling, Governor Len Small and Vernon Curtis, Grant Park, Ill., banker, indicted on charges of attempting to defraud the state of interest money on state funds. Sterling's friends asserted that the accounting had no connection with the indictments and pointed to a letter submitted with the check for the money in which attention was called to an earlier letter to the state treasurer, when Sterling turned over his affairs to his successor in that office, in which he said that when all intorest collections were made and proper deductions for interests due the federal government were made, he would render a final accounting. Mr. Sterling in his letter states that this is the final accounting with the exception of an item of $15,000 deposited with the Union State Bank of Dixon, Ill., for which he holds collateral. This bank, he says, is in a receiver's hands, but he expects a settlement soon. If the settlement is not made, Mr. Sterling offers to make good the amount of the deposit. With the deposit yesterday, the interest collections turned into the state treasury by Mr. Sterling for his two year term as state treasurer total $996,121.85.

6. August 24, 1921 Free Trader-Journal and Ottawa Fair Dealer Ottawa, IL
Article from Free Trader-Journal and Ottawa Fair Dealer, August 24, 1921

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money in which attention was called to an earlier letter to the state terasurer when Sterling turned over his affairs to his successor in that office in which he said that when all interest collections were made and proper deductions for interest due the federal government were made he would render a final accounting. Mr. Sterling in his letter states that this is the final accounting with the exception of an item of $15,000 deposited with the Union state bank of Dixon, III., for which he holds cellateral. This bank, he says, is in a receiver's hands, but he expects a settlement soon. If the settlement is not made, Mr. Sterling offers to make good the amount of the deposit. With the deposit yesterday the interest collections turned over by Mr. Sterling for his two year term as state treasurer total $996,121.85. Sterling Remains Silent. Springfield, Ill., Aug. 24.-Lieut. Gov. Sterling, who yesterday made his final payment of interest earnings to State Treasuerer Miller arrived in Springfield today. He went to a hotel, had breakfast and declined to discuss either the payment or the embezzlement and conspiracy cases pending against him, Gov. Small and Vernon Curtis, Grant Park banker.

7. August 25, 1921 Abilene Weekly Reflector Abilene, KS
Article from Abilene Weekly Reflector, August 25, 1921

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STERLING PAYS IT BACK Former Illinois Treasurer Gives His Successor $391,336.26 Chicago, Aug. 24. - -Fred E. Sterling, lieutenant-governor of Illinois, who was recently indicted with Gov. Len Small and Vernon Curtis of Grant Park, Ill., on charges of embezzlement and conspiracy, involving 2 million dollars of state funds, yesterday forwarded a draft for $391,386.28 to Edward E. Miller, his successor as state treasurer. In a letter accompanying the draft Mr. Sterling explained that this sum was "all the interest collected by me on state deposits since May 31, 1920," and that it included "inter est to date on such collected, interest items from the dates when the same came to my hands." The letter further declared that this left only one unadjusted item, "namely $14,000 deposited with the Union State Bank of Dixon, III., for which deposit slip I hold collateral." Mr. Sterling pointed out that this bank was in the hands of a receiver and that he expected an adjustment soon when he would turn over the amount received to the state treasurer.

8. June 12, 1922 The Rock Island Argus and Daily Union Rock Island, IL
Article from The Rock Island Argus and Daily Union, June 12, 1922

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STERLING GETS CASH FOR STATE Former Treasurer Effects Settlement in Full With Defunct Bank at Dixon, III. Rockford, III., June 12-Lieutenant Governor Fred E. Sterling, former state treasurer, today effected sęttlement in full\ with Receiver Weyant of the defunct Union State bank of Dixon, whereby Sterling collected in full $15,000 of state funds, which, as state treasurer, he had on deposit in this bank when it became insolvent, together with the 3 per cent on the amount from the day he left the treasurer's office, Jan. 10, 1921, to date, amounting to $637.50. Mr. Sterling today forwarded to State Treasurer Miller, a draft for $15,637.50, which closes up the last matter of his treasurership term and completes paýment to his successor of all money which was shown by the state auditor's statement to be due from him at the close of his term. The defunct bank was the only one of nearly four hundred depositories of state funds which failed during Sterling's term as treasurer, and because of a fortunate settlement made today, after red tape court procedure, the state did not suffer the loss of a single penny, either in principal or interest.