Hampshire Company Trust Company (Northampton, MA)

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Rush of Depositors to Withdraw Uses Up All Available Cash

State Bank Commissioner in Charge Embezzlement by "Dick" Newcomb, Now in Jail, Blamed for Condition Depositors Will Not Lose, Officials Say in Statement; Crowd at Doors of Institution This Morning.

By Staff Reporter

NORTHAMPTON, March 28-The Hampshire County Trust Company was this morning ordered closed by Roy A. Hovey, State Commissioner of Banks, after the examination of the accounts which has been in progress for nearly a month disclosed a shortage of $285,000. This amount was abstracted from the funds of the bank's savings department, state banking officials say, by. Harold Richard Newcomb, manager of that department, who is now in jail pending trial as an embezzler.

Run by Depositors Depletes Cash

The bank this afternoon the appointment of Albertus Morse, Northampton attorney, to be liquidating agent of the The action which closed the doors of the institution this morning was the direct result of two-day run during which depositors made such substantial withdrawals that bank's seriously depleted. Ralph Hemenway, former law partner of former Calvin Coolidge, president of the bank. Judge John W. Mason of the District

Court of Hampshire is chairman of its board of directors Two statements were this morning the first by Arthur Guy, bank examiner, in charge, and the other by Judge Mason and Mr. Hemenway

Guy's Statement. Mr. Guy's statement: run which developed result of the disclosure by state bank examiners last week of shortage in the [Continued on Sixth Page.]

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$15,000 THEFT CAUSES RUN ON BANK IN MASS.

Arrest of Defaulting Manager Necessitates State to Shut Bank's Doors

NORTHAMPTON Mass.. Mar County Trust Compay. one of the oldest banking instintions in western Massachusetts. closed its doors The action recalled the recent arres: of William A. "Dick" Neweomb manager of the ban's saving department and widely known orchestra leader. was taken custody last week charged with misappropriation of $15. 000 in bank funds. There had been run on the trust company for the past few days and yesterday the situation became serious

This morning. crowd which gath ered outside the bank saw on the door the following notice "Unnder the authority vested in me by law. hereby take possession of the property and business of the Hampshire Country Trust Company (Signed) Roy A. Hovey Commissioner of Banks. The big crowd that had assembled outside the bank began dispersing shortly after m. Rumors current throughout the city had it that the bank's losses might run as high as $285,000, but there was no confirmation. It was generally regarded as incredible that this amount could have been misappropriated by Newcomb during the more than five years that he managed the savings department. President Ralph W. Hemenway of the Trust Company could not be reached at his home for statement.

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BANK FAILED TO OPEN

Savings Department Manager Was Arrested Two Weeks Ago on Embezziement Charge

Northampton, Mass., Mar. The Hampshire County Trust company closed its doors this morning with shortage of approximately $285,000. Blame for the loss placed rectly upon Harold R. Newcomb, former manager of the savings department, by Arthur Guy, state banking examiner in charge. A statement by Ralph Hemenway, president, said the savings depositors would timate loss. It became known today that the bank had been subjected to heavy withdrawals ever since Newcomb's arrest and Mr. Hemenway admitted this morning that there had been virtual run yesterday. Bank officials have steadfastly fused to disclose the actual amount of Newcomb's alleged defalcations but it was said today that the bank's defieit might reach "six figures." It also became known this morning that six spent all last week going over the books. They left last Saturday. The last available statement of the bank's condition showed commercial department assets of $1,034,000; assets, $1,849,000; ings department assets, $91,000; trust department $1,669,000; Christmas ings deposits, savings deposits, $9,000; trust department deposits, $100,000. A. Hovey, state notice by Roy A that he had banking commissioner, taken over the institution was posted at the main On Page 2) (Continued

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PROPER SYSTEM LACKING IN BANK, DECLARES HOVEY

Management Evidently Did Not Take Precautions Directed, Says State Commissioner.

DOUBTS BUSINESS WILL BE TAKEN OVER

Efforts to Interest Other Institutions Have Been Unsuccessful; Laws Make It Difficult.

Special to The Springfield Union. BOSTON, March 28-Bank Commissioner Roy Hovey, commenting on the closing today of the Hampshire County Trust Company of Northampton, the assets of which have been reduced some result operations of Harold R. Newthe comb, former of the savings according to bank offistated that the losses would not have sustained the bank the affairs of agement institution in proper business the manner. It understood that the disthe accounts has prenumber of years. Commissioner Hovey upon phase declared that for the bank examine yearly audit books of State wrong the Northbecause that officers not have proper whether the funds not being taken by ployes. stated directed the which he evident his advice was

Appoints Morse.

Today the appointed of liquidatMorse will gather the of the bank and distribute them assets Commissioner Hovey said that the bank officials are better position than this the depositors be paid in full. Hovey doubted the the bank by any other institution Efforts this end already have but have been sucmade, Under the Federal banking national open branch county. savings bank under community bank Such laws the make difficult for the be over by larger bank. Mr. Hovey that case like this the fraudulent order mitted slips from inactive accounts, the state would discover happened, the amount taken had reached serious proportion of the bank's assets.

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CLOSES DUE TO SHORTAGE Institution Patronized by Coolidges Has Sales Manager Arrested for Theft. By the Associated Press. NORTHAMPTON, Mass., March 29. -The Hampshire County Trust Co., suffering a shortage of approximately $285,000, closed its doors yesterday less than two weeks after Harold R. Newcomb, manager of its savings department, was arrested charged with theft of its funds. Newcomb, who of nights was the leader of a popular jazz orchestra, was arrested on March 17, specifically charged with the theft of $15,000. He was held in defaul of $30,000 bail. The disclosure resulted in heavy withdrawals of deposits, developing to the proportions of a run which resulted in the State Banking Department taking over the bank's affairs. An excited group of more than 100 persons, moved by rumors of a shortage, milled about the doors of the bank this morning and it was necessary to call several policemen to maintain order. Former President Calvin Coolidge and Mrs. Coolidge have accounts at the bank, but were not disturbed over the conditions at the institution. A statement from the office of the former President said that Mr. and Mrs. Coolidge had not withdrawn their money and felt that if was "perfectly safe." Arthur Guy, State bank examiner, said the trust company has deposits of $600,000 in its commercial department and $1,575,000 in its savings department, a capital of $150,000 and undivided profits, including surety coverage of $312,000. In a joint statement, Ralph Hemenway, president, and John W. Mason, chairman of the directors, said: "There are assets enough to pay the depositors in full."

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FORCE BANK TO SUSPEND

Depositors Start Run On Bank at Northampton After Embezzlement

NORTHAMPTON Mass., March Hampshire County Trust company, suffering shortage of approximately closed its doors today less than two weeks after Harold R. Newcomb, manager of its savings department was arrested charged with thefts of its Newcomb at night the leader of popular jazz orchestra, was arrested March 17. specifically charged with the theft of 000, and held in default of bail. The disclosure resulted in extremely heavy withdrawals deposits, which resulted in the state banking department taking over the affairs of the institution An excited group of more than 100 persons moved by rumors of shortage. milled about the doors of the bank this morning and it was necessary to call police officers to maintain order. "Former President Calvin Coo.idge and Mrs. Coolidge have accounts at the bank but were not disturbed over the conditions at

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HOVEY TAKES STEPS TO GET SURETY BOND

Ex-Mayor Andre Appointed to Proceed in Collection

Band to Continue Under New Name

With Bernache as Director

Special Dispatch to the Globe NORTHAMPTON, April 1-Roy A. Hovey, State banking commissioner who closed the Hampshire County Trust Company last Friday after alleged embezzlement of $285,000 by Harold Richard Newcomb, manager of the savings department, had caused run on the bank, today announced be had attorney Jesse A. Andre, an ex-Mayor of, Northampton, as counsel, and had instructed him to proceed at once with the the trust arising out of the bonds covering The was made through Deputy Commissioner Arthur Guy, who left tonight for Boston, having turned matters over to Eugene Briir. mer, assistant director of the division of trust companies of the State BankDepartment. Mr Brimmer, who took an important part in the of trust companies in Boston in 1920 and 1921, will cooperate with attorney Alvertus Morse, liquidating agent, and act as his assistant. Following a conference last night between Mrs Harold R. Newcomb, who has taken over the of the orchestra, formerly led by her husband, William present leader of the band, it was an-

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Bank Wrecker

Former President and Mrs. Calvin Coolidge were among the depositors in the Hampshire County Trust Co. Northampton, Mass. which was closed after two-day run on the bank had resulted from charges of embezzlement placed against Harold R. Newcomb. above manager of the savings department. Newcomb was arrested and held under $50.000 ball Officials disclosed a $285,000 short-

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Accuse Banker

Former President and Mrs. Calvin Coolidge were among the depositors in the Hampshire County Trust Co., Northampton, Mass., which was closed after a two-day run on the bank had resulted from charges of embezzlement placed against Harold R. Newcomb, manager of the savings department Newcomb was arrested and held under $50,000 bail. Officials disclosed a $285,000 shortage.

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Accused As Cal's Bank Closes

Former President and Mrs. Calvin Coolidge were among the depositors in the Hampshire County Trust Co., Northampton. Mass., which was closed after two-day run on the bank had resulted from charges of embezzlement placed against Harold R. Newcomb, above, manager of the savings Newcomb was arrested and held under $50,000 bail. Officials disclosed a $285,000 short-

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Held As Embezzler

Former President and Mrs. Calvin Coolidge were among the depositors in the Hampshire County Trust Co., Northampton, Mass., which was closed after a two-day run on the bank had resulted from charges of embezzlement placed against Harold R. Newcomb, above, manager of the savings department. Newcomb was arrested and held under $50,000-ball. Officials disclosed a $285,000 shortage.

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Accused, as Bank With Coolidge Funds Fails

President and Mrs. Former the depositors Coolidge were among County Trust Co., in the Hampshire Northampton. Mass.. which closed on the bank had after two-day run resulted from charges of embezzlement placed against Harold R. Newcomb. above, manager the savings Newcomb arested department. Officials and under $10,000,000 disclosed

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ACCUSED AS CAL'S BANK CLOSES

Former President and Mrs. Calvin Coolidge were among the depositors in the Hampshire County Trust Co., Northampton, Mass., which was closed after a two-day run on the bank had resulted from charges of embezzlement placed against Harold R. Newcomb, above, manager of the savings department. Newcomb was arrested and held under $50,000 bail. Officials disclosed a $285,000 shortage.

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ACCUSED, AS BANK WITH COOLIDGE FUNDS FAILS

Former President and Mrs. Calvin Coolidge were among the depositors in the Hampshire County Trust Co.. Northampton, Mass., which was closed after two-day run on the bank had resulted from charges of embezzlement placed against Harold R. Newcomb, above manager of the savings department. and held under $50,000 bail. Officials disclosed $285,000 shortage.

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Accused, as Bank With Coolidge Funds Fails

Former President and Mrs. Calvin Coolidge were among the depositors in the Hampshire County Trust Co., Northampton, Mass., which was closed after two-day run on the bank had resulted from charges of èmbezzlement placed against Harold R. Newcomb. above, manager of the savings department. Newcomb was Officials disclosed short-

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BANK WILL PAY DIVIDEND TODAY TO DEPOSITORS

Hampshire County Trust to Distribute $296,567 to Commercial Accounts Second Payment.

Aug Hampshire County Trust Company Saturday pay cent on commercial account claims proved and allowed up to and including July 15. Commissioner of Banks Hovey was on July 23 authorized to make this payment to The sum of $296,567 will available to the 1601 commercial depositors when the bank opens its doors at o'clock. This payment made the bank hands the liquidating agent on March 28. shortages the accounts Harold Newcomb, manager the department. the and forced into the hands the officers On July 26 per cent dividend depositors became Of,the which the dividend called for, all but about $50,000 has been paid. On July 23 the commercial departpayment of $297. but since that time setoff of debts depositors has reduced the sum $296,567.97. Payment of the dividend is to be by drawn by commissioner of banks upon the Northampton National The payment is being handled by Liquidating Agent Alvertus Morse Assistant Liquidating Agent Wilbur Purrington.

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