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PROCEEDINGS IN GREEN TRIAL FOR EMBEZZLEMENT
(Continued from DAG 2) the insurance department had a value of Dr. L. D. Richardson was the first witness called by the defense. The receiver had expressed the opinion that a mortgage for $1,143 held against household goods and dental equipment owned by Dr. L. D. Richardson of Garrett, was worth $128 less than that, but Dr. Richardson said the property is worth $2,500, in his opinion. The $50 monthly payments called for by the mortgage have not been made. The receiver also testified that real estate on South Randolph street in Garrett owned by Geo. Valos and mortgaged by the trust company for $3,850 is worth only $3,000. Mr. Valos told the jury that he believes the property to be worth $4,500. Vice-President on Stand
A. R. Moore, a director and vicepresident of the Garrett Savings Loan & Trust Co., testified that the bank vault including the door, cost $11,000. He said the executive committee passed on every loan and on bond purchases and that the board placed a value of $48,000 on the building when the remodeling was completed in 1924. As time went by, the bank attempted to change its business chiefly from mortgage loans to personal loans. The executive committee met weekly, said Mr. Moore. Excluding the Henslee notes and $7,000 in other notes, Mr. Moore considered the assets all sound at the time of suspension. He believed the building was worth $44,000. The fair rental value of the banking room was $150 a month, he said. A return of 8 to 9 per cent on the investment was satisfactory, in his opinion. Bank examiners inspected the bank three or four times year, said Mr. Moore. The last visit was in September before the institution closed. Mr. Moore was asked if proceedings were in progress at the time the bank closed to appeal from the judgment of $11,699, but an objection by the state was sustained by the eourt. The capital of the bank, said Mr. Moore, was and the surplus was $10,000. He expressed the opinion that the bank was solvent when it closed. On cross-examination, Mr. Moore said he was not sufficiently familiar with the bank bookkeeping to be able to ascertain the exact condition of the institution. The cash reserves had become low in the last week the bank was open, said Mr. Moore. He had no knowledge of cash withdrawals by employes of the bank during the last week. The state then placed in evidence check for $931. 25 for money drawn out by Miss Ann Ueber, the cashier, on Dec. 31. The balance shown in her account was about $15 after this withdrawal. Another check for funds withdrawn that day was by Angela Schiffli for $1,500, leaving a balance in her account in the bank of $83.27. Mr. Moore was asked If he knew that the state examiner the last time he examined the bank refused to certify that the capital was not impaired and the witness replied in the negative. He did not know that the bank had guaranteed the payment of the L. Dale Green note of $2,000 to the Fort Wayne bank. The closing of the bank was not discussed by the directors until Jan. 1, said Mr. Moore. The last time he checked over the loans was in March or April, 1930. He thought some notes had been charged off as worthless during the last five years, but he was not able to specify any cases or dates. The defense produced the record of the accounts of Mrs. Tresia Ueber, mother of Ann Ueber, showing she had a balance when the bank closed and she deposited $350 the last day the bank was open. Defendant on Stand The tragic last hours of the Garrett Savings Loan & Trust Co. were described to a jury in the DeKalb circuit court Friday by Monte L. Green, who was its president until it suspended last Dec. 31. Indicted for embezzlement in the acceptance of a deposit when he knew the institution was insolvent, the defendant took the stand in his own behalf at the opening of court Friday morning. He was interrogated by Attorney R. S. Emerick of Kendallville, who, with Attorney Edgar W. Atkinson of Auburn, is handling the defense. The defendant is sixty-one years of age. He helped to organize the bank and became its president in 1910. He was first questioned coneerning the value of mortgages and other assets of which Receiver H. C. Springer had testified. The receiver said some of the notes and mortgages were of little or no value. The defendant agreed with him on some of the valuations, but he insisted in other cases that the assets were worth at least their face value. With reference to chattel mortgages against E. B. Henslee, amounting to nearly $2,200, the defendant said he considered them worth 50 cents on the dollar at the time the bank closed. A mortgage on Garrett real estate owned by Henslee, in the sum of $3,450, was worth the entire amount, said the witness. He acknowledged that what he described as second mortgage on Fort Wayne real estate owned by Henslee was practically worthless, as was also a second mortgage for $550 on the Garrett real estate. The total obligations of Henslee to the bank were about $15,000 and the defendant told the jury he considered the loss on these assets would be at least $10,000. "None of the bonds held by the bank, and none of the interest on these bonds had been defaulted up to the time the bank suspended," the defendant testified. "I expected all of the bonds to be paid when they matured. He said he was aware there was a fluctuation in the market price of the bonds and that there was some shrinkage. Has Nervous Attack At this point the witness suffered a nervous attack and Judge Endicott ordered a recess. The defendant soon recovered and the trial was resumed. Referring to testimony submitted by the defense to the effect that securities were carried among the assets at par value instead of their actual cost, the defendant said such policy had been followed ever since the bank was organized. He described this as the "easy audit system. The defendant declared that negotia ions were pending at the time the bank closed for compromise settlement of the $11.699 judgment secured the trust company and last year by the Union bank of Fort Wayne. On Dec. 1930, his wife, Helen S. Green. with drew 5,000 from her savings account and paid a mortgage against the residence property The defendant said negotiations were in progress to borrow $5,000 from the First and Tri State National Bank & Trust Co. of Fort Wayne, giving a first mortgage on the residence property as security, and this $5 was to be used to settle the judgment in full At the time a certificate of deposit for $1,832 representing what he termed savings by himself and his wife was cancelled Dec 31. the day the bank closed, he was not attempting to salvage something from the institution, the defendant insisted. Instead. a frantic effort was being made to raise cash with which the bank could continue to operate. He took 200 shares of Corporate Trust Shares in payment for the certificate and gave them to his son, Dale. The latter went to Kendallville and returned with $1,000 in currency that he had borrowed at the Noble County Bank & Trust Co., giving the Corporate Trust stock as security. "This $1,000 was used in the bank's business,' said the defendant. He testified that he and his wife and daughter had nearly $4,000 on deposit in the trust company that was not drawn out and remained there. The state had placed in evidence papers showing the withdrawal of $931 25 by Miss Ann Ueber, one of the employes of the bank, the last day the institution was open. The defendant said Miss Ueber was not given cash. there not being that
Combined Trust Shares whose face value equalled that of her withdrawal. This, it was indicated, was another act in the desperate effort to raise cash for the use of the bank. "But you failed to do it?" inquired Mr. Emerick. "Yes," was the defendant's reply. Other Directors Summoned The trust company had to pay a cash letter from the federal reserve bank every day. The defendant said the one that arrived Dec. 31 was met, but that he became aware that the one to be presented by the express company the morning of Jan. 2 could not be,paid, and in that event it would be necessary to close the doors. He said he worked on Jan. 1 on the preparation of the called report, which disclosed the condition of the bank. In the afternoon he and his son, Dale, called in the other
Green, J. P. Gephart and A. R. Moore. "I told them the condition of the cash was such that we would be unable to open the next morning and we decided to close for examination by the state banking department. Augustus E. Kistler, the prosecuting witness in this case, was an oldtime depositor of the bank. The defendant said that late on December 31 Mr. Kistler entered the bank, made a $25 deposit, applied $7 or $8 on a note he owed and renewed the note in the sum of $37. "Did you know when you accepted this deposit that the bank would close that night for the last time? asked Mr. Emerick. "No, did not,' was the reply. "But you did know it would close unless you could raise some "Yes." The original investment in its said the defendant. In 1923 an addition was bought and the structure was remodeled, the total investment then amounting to $48,000. The witness declared the property was worth $45,000 when the bank closed. He said $500 a year had been charged off for three years, but $500 was added one year when one of the apartments was remodeled. He said the rental of the banking room was worth $150 a month and that the total rentals were thus about $4,000 a year. Had $13,000 in Bonds The defendant, on cross-examination by Attorney Bodenhafer, ex-
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