6068. Martinsville Trust Company (Martinsville, IN)

Bank Information

Episode Type
Suspension → Closure
Bank Type
trust company
Start Date
August 1, 1932*
Location
Martinsville, Indiana (39.428, -86.428)

Metadata

Model
gpt-5-mini
Short Digest
751285a4

Response Measures

None

Description

Articles (Aug 1932 and Feb 1933) describe the Martinsville Trust Company as closed and in the hands of receivers; officers were arrested for misapplication of funds. No article describes a depositor run. Therefore this is a suspension/closure (permanent) driven by bank-specific malfeasance/insolvency.

Events (2)

1. August 1, 1932* Suspension
Cause
Bank Specific Adverse Info
Cause Details
Bank was insolvent and officers accused of misapplying funds; deposits allegedly accepted knowing institution was insolvent prior to closing (per affidavit mention).
Newspaper Excerpt
the Martinsville Trust Company, also in receivership, were filed in federal court
Source
newspapers
2. August 25, 1932 Receivership
Newspaper Excerpt
The trust company also is in the hands of receivers. ... Suits to have ... the Martinsville Trust Company, also in receivership, were filed in federal court this week.
Source
newspapers

Newspaper Articles (3)

Article from The Indianapolis Times, August 25, 1932

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Article Text

BANKERS ARRESTED Misappliance of Funds Is U. S. Court Charge. Arrested on charges of misapplying funds of the defunct Spencer National bank, Owen county, Karl I. Nutter, Martinsville, former bank president, and Frank Wright, 2131 College avenue, former cashier, were held to the federal grand jury on Wednesday. The bankers were charged in warrants with "misapplying" funds to the amount of $3,500 on or about June 23. Federal accountants are studying records of the closed bank in preparation for investigation at the next grand jury session, according to George R. Jeffrey, district attorney. Suits to have Nutter and four other stockholedrs of the Spencer bank and the Martinsville Trust Company, also in receivership, declared involuntary bankrupts, were filed in federal court this week. The suits, filed by officials of various taxing units of Morgan and Owen counties, are seeking to recover on bonds given by the five men to guarantee public funds in the two banks. Nutter and Wright were released by Fae W. Patrilck, United States commissioner, on $2,500 bond each.


Article from The Reporter-Times, August 27, 1932

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Article Text

MAKES STATEMENT H. K. Smith, of Hall, better known as "Keller" Smith, called at this office Friday and said that he desired make statement relative to the use of his name in the affidavit against certain officers of the Martinaville Trust Company and on which they were arrested. His name is given as prosecuting witness and it was aver red that a deposit was accepted from him by the company on Saturday be fore the closing of the institution, the officials knowing at that time that it was insolvent. Mr. Smith said he sired to state that he made no de


Article from The Indianapolis Times, February 4, 1933

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Article Text

BANK OFFICIALS ARE GIVEN U. S. PRISON TERMS 'Think of Depositors,' Says Baltzell in Sentencing Three State Men. Replying to pleas for leniency with the remark, "Think of the depositors," Federal Judge Robert C. Baltzell Friday sentenced three officials of the defunct Spencer (Ind.) National bank to a total of nine years and a day for violation of the national bank act. Karl I. Nutter, president of the Spencer bank and the Martinsville Trust Company, was sentenced to five years in Leavenworth prison. The trust company also is in the hands of receivers. Frank Wright, 3129 College avenue, cashier, was sentenced to the federal reformatory at Chillicothe, O., for three years. The bank's vice-president, Temple G. Pierson, was sentenced to a year and a day in Leavenworth prison. The three officials were among 170 men and women who faced Baltzell, charged with bootlegging, narcotic peddling, counterfeiting and kidnaping. Scored by Judge Nutter, who claimed he lost $200,000 in the closing of the two institutions, was scored by the judge when he said he did not know the condition of the Spencer bank at the time the misappropriation of funds took place. Nutter said he asked Wright for funds from the Spencer bank to bolster the crumbling Martinsville institution, but that he had no idea he was endangering the bank's security. "You were a bank president for twenty years," said Baltzell. "You should have found out in that time that it was your duty to know the bank's condition." When Homer Elliott, attorney for Nutter, pointed out that none of the officials had taken money for their own use, Baltzell said, "Does that mean anything to the depositors who now are living in or near poverty because of the money they lost in the bank?" Gets Slight Sentence Violation of the new law against use of the mails for extortion brought a sentence of a year and a day for Myr. Myers of Greenwood. The law was passed by congress following the Lindbergh kidnaping case last year. Myers sent a letter to a Greenwood business man threatening to kidnap his baby if he did not deliver $3,000. Myers was captured when he tried to collect the money. "I am passing a light sentence on this man," said Baltzell. "But if any gangsters try it, I will give them the limit." The law calls for "imprisonment of not more than fifteen years." Many Others Sentenced Those sentenced in the Indianapolis division on liquor charges were: Harry McCormack, four months; Joe Marino, six months; Joseph Dumato, $150 fine and ninety days; Walter Ewing, Negro, six months; Frank Beard, four months; William Jones, one day; Albert Shireman, four months; Charles Fosso, four months, and James Presuttio, four months. Sentenced on other charges were: Charles Truckey of Stendal, passing counterfeit money order and possession of counterfeiting equipment, five years; Miss Marguerite Pappas, Greenville, O., passing countereit money orders, year and a day; Raymond Enneking, Brooklyn, N. Y., tampering with mail box, two years; Arthur Dillingham, forging adjusted service certificate and counterfeiting, five years on each count, to run concurrently; Lauren H. Turk, white slavery, five years; William Ball and Helen- Sullivan forging,