Central Bank & Trust Company (Asheville, NC)

Episode Information

Episode UID
66003871571
Episode Type
Run โ†’ Suspension โ†’ Closure
Bank Type
trust
Bank ID
6600387 routing
Routing Number
66-0038
Start Date
November 19, 1930
Location
Asheville, North Carolina (35.601, -82.554)

Metadata

Model
gpt-5-mini (chosen from majority vote of a three-model LLM ensemble)
Short Digest
a136e76199c74763

Response Measures

None

Description

Failure tied to bank-specific malpractices and connections with Caldwell & Co./Luke Lea; receiver/liquidation followed suspension.

Events (4)
1. November 19, 1930 Run
Cause
Bank Specific Adverse Info
Cause Details
Heavy withdrawals precipitated by discovery of mismanagement, bad securities and links to Caldwell & Co./Lea manipulations; loss of confidence after estate/real-estate boom reverses.
Measures
Officers sought loans and liquid assets; accepted deposits from city and county after banking hours; attempted to raise funds from friends and correspondent banks.
Newspaper Excerpt
Wednesday, November 19...heavy withdrawals Monday and Tuesday made serious inroads...a run on the bank was assured.
Source
newspapers
2. November 20, 1930 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Bank lacked sufficient cash and liquid assets after heavy withdrawals and deteriorating assets tied to questionable securities and intercompany dealings; directors closed the bank to avoid immediate depletion.
Newspaper Excerpt
The board of directors voted early Thursday morning, November 20, not to open the doors.
Source
newspapers
3. December 9, 1930 Receivership
Newspaper Excerpt
Asheville Bank Receiver Asked In New Petition...application for receiver filed here today in district court...petition that the Central Bank and Trust company be enjoined from interfering with the company funds held by the bank as security for bonds of the defendant; officers of the bank and securities company are the same.
Source
newspapers
4. December 18, 1930 Other
Newspaper Excerpt
An order authorizing G. N. Henson, state liquidating agent of the defunct Central Bank and Trust Company to assign ... was signed in superior court yesterday...the date when the bank suspended business, Mr. Henson further set forth that the insurance department was indebted...
Source
newspapers

Newspaper Articles (23)
1. November 21, 1930 The News and Observer Raleigh, NC
Article from The News and Observer, November 21, 1930

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BANKS CLOSE DOORS IN WESTERN TYING UP O'VER 22 MILLION DOLLARS Convicted Bankers Will Not Be Given Clemency Governor Also Includes Public Officials and Those Who Breach Judiciary Relations in Public Statement; Has Received Many Requests and Denied Them All Persons imprisoned for violation the banking laws, positions public trusts and breeches fiduciary relations need not apply for executive elemency unless there health of the prisoner in jeopardy, according served yesterday by Governor Gardner. The Governor's public ment based urgent appeals that have been made to him for clemfor some ten prisoners confined the State Prison far have made their pleas But although based on cases that occurred the past rather than anticipation anything that might happen North Carolina the future, statement followed receipt the news fresh bank Western North Carolina. time when public fidence sorely needed and this will do its power that confidence." declared Gardner statement, think that the should know that there will be pardoning paroling those convicted betraying trust under extraordinary circumstances. Governor Gardner's statement fol. lows full: "There has developed in recent many petitions from strong source applying for for prisoners confined the State's for violation the banking positions pubtrust, and for breaches fiduWhile there uniformity punishjudge his view the law and the also that most difficult down hard and uniform when stand merit, do this the public that will be the policy of this fice not interfere with the tences the courts in the of cases, there delevoped evidence the health the prisoner gravely by further Prisoners character mentioned, differing from ordinary criminals, (Please Turn to Eight) Closing of Six Banks Linked With Failure of Central Bank and Trust Comof Asheville pany CRASH LARGEST IN FINANCIAL HISTORY OF THE STATE Asheville Bank Was Fourth Largest in State; Three Banks Close in Hendersonville Leaving Town Without Banking Facilities; Other Asheville Banks Withstand Runs; Chief Examiner Mitchell Leaves For Asheville; Blames Crash Estate Boom Aftermath; City of Asheville and Counof Buncombe Were Largest Depositors in Closed Central Bank, Which Was Most Important Financial Western Carolina; Few State Funds in Banks and All Amply cured Eight North Carolina banks with deposit liabilities of $22,270,601 yesterday. All the banks located the the State, and cept the Bank Lowell, small bank County textile munity, the centered about crash the Central Bank and Trust Asheville, fourth largest bank the State and single bank. deposit liability the bank the largest history the State. Chief State Bank Examiner John Mitchell and Corporation CommisAttorney Bailey left for night. frankly feared banking circles other failures the far western would follow yesterday's closings, but Examiner Mitchell issued ment which he termed the situation "purely local" and reflecting conditions in the State generally, Wallace Davis was President the Central Bank, and Chas. Bradford, esahire. Seven the banks closing yester. day were State banks, running the total for the Others Withstand Runs. While largest failure took place Asheville, the other banks withstood runs. nate, and night was without banking three its banks closed. The First Bank and Trust Company failed its doors yesterday American Bank and Trust Company only minutes, and after hours the Citizens tional Bank, the only national bank suspend closed its doors the face the banks totalled the last call date, 24. by the directors of Central Bank Trust Company not few minutes yesterday morning. The bank had subjected heavy several days. The State fied by telephone take charge for liquidation. Others Close. Shortly thereafter banking department notified of the clos. the bank, and three Hendersonville banks. Later requested to send agents take charge of the Bank Leicester, Buncombe County, the Clay County Bank Hayesville. The cashier of the Clay County Bank reported grim humor. "Central closing closes Send wired the banking department. Attached the gram Thanksgiving seal, used by the telegraph company messages. Then came the news the failure the Bank Lowell, its closthe far western officials blaming failure of deposits of the Lowell yarn small bank, deposits. Cause Failure. Banking officials clined link Central with the house Cald. although current Asheville that Caldwell interests preparing refinance Mitchell laid the fail. from boom quent estate curity which imposdemands Central bank favorite for county months million dollars Park funds raised State were withdrawn. Large Public Funds. On reported had deposit 216,674 the city $2,445,975; and Board 177. These amounts (Please Turn

2. December 9, 1930 The Greensboro Record Greensboro, NC
Article from The Greensboro Record, December 9, 1930

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Asheville Bank Receiver Asked In New Petition WILMINGTON Del., Dec. that the assets the tral company. Asheville have unlawfully used for the benefit the close Central Bank and Trust company that city contained in application for ceiver file here today in district court. The application was filed by Kusterer and company on behalf of itself and other bond holders. The asked named "prevent further dissipation diversion the company's property and assets also petitionthat the Central Bank and Trust company. trustee enjoined from interfering with the the company any of the trust funds held the bank security for bonds of the defendant The officers the bank and curities company are the same. the suit set December set as the date for hearing.

3. December 18, 1930 Asheville Citizen-Times Asheville, NC
Article from Asheville Citizen-Times, December 18, 1930

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HENSON TO-SELL INSURANCE ITEM Accounts Of Companies Accepted In Full For Payment An order authorizing G. N Henson. state liquidating agent of the defunct Central Bank and Trust Company to assign to the United States Fidelity and Guaranty Company and the Century Indemnity Company all their uncollected RCcounts of the bank's insurance department in full settlement of an indebtedness of owed by the insurance agency to the two companies, was signed in superior court yesterday by Judge Cameron F. MacRae In petitions filed in superior court. Mr Henson explained that the insurance department of the bank on November 20 owed the United States Fidelity and Guaranty Company according to record $15 less comissions of $3.026 16. leaving net indebtedness of $12,460.12 On the same date the date when the bank suspended business, Mr. Henson further set forth that the insurance department was indebted to the Century Company in the amount of $10,108.31 les commissions of $2.906 45. or net indebtedness of $7,201 86 Not Practical As petitioned. Mr. Henson stated that he had been informed and believed that it was not practical nor beneficial for him to continue to operate the insurance department and that since both companies had proposed and agreed to accept the uncollected accounts in full settlement the obligations and to release him as liquidating agent, acceptance of their would be to the interests of the bank's creditors. The accounts to be transferred to the two companies by order of the court include only the obligations of policy holders whose policies are with the United States Fidelity and Guaranty Cmpany and the Century Indemnity Company and which were handled by the department as agent for the two companies concerned Mr. Henson further stated as petitioner that in due course of his examination of the bank's affairs he had caused careful check of the accounts to be made and that their status in general shows them to have no equity and that no benefit would accrue either to depositors or creditors of the bank from any attempt on his part to continue them in force He also said that the cost of collecting these accounts would exceed any net profits Transfer Accounts In his Judge MacRae ordered that Mr Henson be allowed to transfer to each of the two companies concerned its individual uncollected accounts and that their proposals be accepted in full He also ordered that after carrying out the court's instructions in the transfer. Mr Henson be relieved by fut. ther responsibility in connection with them.

4. December 18, 1930 Statesville Record and Landmark Statesville, NC
Article from Statesville Record and Landmark, December 18, 1930

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1 ROMANCE OF FINANCE THAT FADED INTO GHASTLY TRAGEDY entral Bank and Trust Company Had Dictated Policies In City and County for Decade-Controlled Financial, Business and Real Estate Finally Met Reverse After Reverse. Asheville Dec. collapse of he Central Bank and Trust Company if which Wallace B. Davis was pres ent, depicts a romance of finance hat faded into a ghastly tragedy. Its powerful influence spread to all sections of western North Carolina and with its closing last month, lozen banks closed their doors in symIts ramificat ons reached into all arts of the south and middlewest: is manipulations in finance caused ven the money-wise New York bankrs to give For a decade, it dictated the poliies and dominated the pol tieal leadrs of Asheville and Buncombe counWith only a few exceptions, it sereed what men should be elected to ffice. It dominated civic and comthe hurches were not overlooked. In Control For Years. For years, the finanial, business and real estate fields Asheville and Buncombe county It decided what public improvements should be made, what streets should paved, what new avenues of travel should be established. It fixed prices on real estate by its decisions to buy and sell. It determined the success or fa lure of businesses by its support or derision. In its collapse, the wealth and inluence of its friends tottered: its Ponzi-methods of finance bobbed into the pitiless spotlight of public ty; its political supporters were pushed to of disaster Innocent de the brink lost their life savings, the positors ruling class of the and county were hard put to defend their power. Never has financial institution in western North Carolina dominated so completely Never has one spread its influence into so many different fields, among so many Ifferent peoples. With the collapse of the called real estate boom in Asheville and western North Carolina, the strength of the Central, Bank and Trust company was severely tested. But it required years of depression and poor business to dip into its powerful reserves. Reverse After Reverse. Reverse after gnawed away at its foundation. For weeks, saw many of its depositors withdraw then support; only the intervention of the city and county prevented an earher break When the governmental agencies had reached their lim fact, overstepped their legal restrictionsthe end was inevitable. Desperate means were employed to keep cash on hand to meet the heavy withdrawals that grew in number and gravity as the days passed. Deposits were accepted from the city and county after bank ng hours. Every availliquid asset was sacrificed to able the dwindling amount of That important item, designated as and due from other shrunk more than $2,200,000 in only few The more liquid paper rushed to Cincinnat New York was Baltimore for loans. Collateral and of two and three to one was put up. Financiers Saw End Near. Financial recognized the end near November 14; they had was expected it for weeks, but it became inevitable that day it was only a quest on of days, probably hours. The bank opened for business Sat urday, November 15, with less than $100,000 in cash. Somehow. it managed to struggle through the day. The week-end brought respite. but heavy withdrawals Monday and Tuesday made serious inroads. Wednesday, November 19. was one of desperation; any one of 50 or more depositors could have taken all the approximately $7,000 in silver. The officers and directors tried des perately all Wednesday night to rais money. Friends were sent to ti interecde in behalf of the Central bank. Their efforts proved futile; no liquid assets were on hand to gua antee such loans. Telephone calls banks, investment hanking houses an friends in other cities failed to brin any response. It was with a heavy heart that th board of rectors voted early Thurs day morning, November 20, not to open the doors. There wasn't at crowd in front of the bank, but there were hundreds of people scattere around Pack awaiting to pounce upon the institution for the runds. If the bank had opened the morning, its funds would have been depleted within an hour. A run 01 the bank was assured. With the bank's suspens'o off cials began the task of unraveling th real story. In all sections of th south. there bobbed up transaction with the Asheville institution. Caldwell and company, the Nash ville investment banking house which collapsed several weeks previously was accused by the bank of convert ing Asheville city notes to its on use. information had been divulg ed, and the city had been credited W th the entire proceeds of the $305 000 note: although $55,000 was n nut on the books until the final day the bank was in business. The Guaranty Bank and Trust com pany, of Alexandria, La., filed a peti tion in federal court at Nashvil Saturday, December 6. asking fr possession of $150,000 in certificates of deposit upon the Central bank wh ch had been deposited by th closed Bank of Tennessee as a gual antee of deposits. The Bank of Ter nessee was a subsidiary of Caldwe and Tennessee papers, including th Chattanooga Times, had repeated! accused Gov. Henry H. Horton, Nashville publisher and former United States senator. and Rogers Ca well, head of the defunct Caldwell ar company. of nolitical alliance The also said that Caldwell and Lea had conferred with W. B. Davis, preside of the closed Central Bank and Trus company here. concerning the forms tion of southern investment bankin heuse. The Central bank was frequent mentioned as allied with the Caldwell Lea interests. financially and polit allv, and its failure was generally at tributed by Tennessee ะดั€ะตะณะฒ to close connection with the Caldwel Lea-Horton combine. Among the deposit securities hel by the tv of Asheville as a gua antee of its deposits in the Centre bank were notes. totaling more than $40 000. either indorsed by Col Ler or protected by collateral in newspa Ders and corporations owned by him The city might have to ask for a re order to force During the last fortnight. informr tion has trickled into the city about the county be ng used by Caldwell inter former Chairman Newton M. Ander son accuses the Central bank of mis apprepriating $875,000 which had been deposited in the bank to pay of notes due between November 12 an 15. Asheville business firms and ind viduals have received notices from the Fifth Third Union Trust compan of and other Balt more and New York, advisin them their notes had been purchas payment in full on maturity date WE demanded. As each day cames. more informs the real story has yet been told. Mechanized Agriculture. Salisbury Post The agriculture donartment of the chamber of commerce of the United States points out that one of the big factors in the scrambling of the farm situation is the steadily increasing mechanization of agriculture. Mere and more such crops as ton. wheat and corn are being proThis calls for more room. Mass prothe corn, cotton and wheat belts. in consequence are slowly moving away from their old habitats to new ones. Thus cotton is perseptibly moving to the west from the deep south. Wheat is heading for the wide open *nces Even corn is shifting its base Where this all will lend to is quite clear. In the end, probably will make agriculture as whole much stronger. But the period of joubt, just ask any tarmer News of Harmony, Route One. Harmony, R-1 Dec. 16. Anothen Christmas will soon be here The older you pet the more rapidly they nass. They are going to have Christ mas exercises at most all the churches neighborhood. The following families have it: Messrs Reed Laws. Will bea, Cecil Kinder and R. M. Dan- indisposed th side pleurisy Mr. Johnson has moved to the H F Heath place. A Mr Lucas, from South Carolina is going to move where John Cobb lives. Mrs L. W Gaither and daughters Borothy and Jewel. visited Mrs. Caither's father and mother. Mr and Mrs. J. L. Heath Mrs. J. L. Heath is indisposed The United States senate may be losing some of its colorful figures but the word from Nominee Huey of will Pittsburgh Post.

5. December 21, 1930 Evening Star Washington, DC
Article from Evening Star, December 21, 1930

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# CHARGE COLLUSION # IN CALDWELL CASE Four Purported Creditors Aver Holding Company Sought Own Bankruptcy. By the Associated Press. NASHVILLE, Tenn., December 20.- Charging Caldwell & Co. "while insolvent" sought to prefer the Bank of Tennessee, a subsidiary, over other creditors, four purported creditors filed a petition in Federal Court today asking permission to intervene in involuntary bankruptcy proceedings pending against the investment banking house. Other alleged acts of bankruptcy were cited. It was alleged that on September 29 the Bank of Tennessee held a large number of securities which Caldwell & Co., under a repurchase agreement, was obligated to repurchase at prices "far in excess and, in fact, in the aggregate over $2,000,000 in excess of the then actual value." Seek Corporate Assets. On that date, the petition averred, Caldwell & Co. turned over to the bank as collateral certain securities "to secure said Bank of Tennessee in that deficiency." In the event the original petition of Dyer County and others, asking that Caldwell & Co. be placed in bankruptcy, is not sustained, the four petitioners asked that their bill be treated as an original action in bankruptcy against the company. Petitioners are Breckenridge County, Ky.; Cumberland County, Tenn.; the receiver for the Central Bank & Trust Co. of Asheville, N. C., and William N. Lynn. The proceeding by which Caldwell &

6. December 24, 1930 New Britain Herald New Britain, CT
Article from New Britain Herald, December 24, 1930

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# RECEIVER NAMED # FOR NEWSPAPERS Memphis and Knoxville Publications Run Onto Rocks Nashville, Tenn., Dec. 24 (AP)โ€” Larkin E. Crouch, Nashville attorney, arranged to furnish $25,000 bond today as receiver for Southern Publishers, Inc., holding company for stock of the Memphis Commer- cial Appeal, Inc., and Knoxville Journal, Inc. Chancellor James B. Newman announced Dr. Crouch's appointment yesterday when he sustained receiv- ership proceeding instituted by the Minnesota and Ontario Paper com- pany, the Nashville Trust company, trustee, and D. D. Robertson, receiv- er for the Bank of Tennessee. Chancellor Newman also denied an application for a receiver for the Tennessee Publishing company, pub- lishing the Nashville Tennessean and Evening Tennessean, saying allega- tions of mismanagement and dissipa- tion of assets, denied by the defend- ant, "do not justify the appointment of a receiver of a going concern whose assets are conceded in the bill to be greater than its liabilities." The Tennessee Publishing Co., suit was brought by the M. and O. Pa- per company, later joined by the city of Asheville, N. C., and receivers for the Central Bank and Trust com- pany of Asheville.

7. April 2, 1931 Evening Star Washington, DC
Article from Evening Star, April 2, 1931

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JOY AT BANK REOPENING! Whole Town Celebrates Opening of Institution Closed Last Fall. WEAVERVILLE, N. C., April 2 (P).The whole town celebrated today as the Farmers and Traders Bank, which suspended business last November, reopened. The mayor made a speech and the student bodies of the public schools marched in a body to the bank for exercises held in the street before 1t. The bank suspended during a financial crisis precipitated in Western North Carolina by the failure of the Central Bank & Trust Co., Asheville.

8. April 2, 1931 The Valdosta Daily Times Valdosta, GA
Article from The Valdosta Daily Times, April 2, 1931

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NO LIGHTS Weaverville, N. C., April 2. (AP) The whole town celebrated today as the Farmers and Traders Bank here which suspended business last November reopened. The mayor made a speech and the student body of the public schools marched in a body to the bank for exercises held in the street before it. The bank suspended during financial crisis precipitated in Western North Carolina by the failure of the Central Bank and Trust Company, Asheville.

9. April 3, 1931 The Springfield Daily Republican Springfield, MA
Article from The Springfield Daily Republican, April 3, 1931

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TOWN CELEBRATES WHEN BANK REOPENED Weaverville, N. C., April 2-(AP)The whole town celebrated today as the Farmers' and "raders' bank here which suspended business last November reopened. The mayor made a speech and the student bodies of the public schools marched in body to the bank for exercises held in the before it. The bank suspended during a financial crisis precipitated in western North Carolina by the failure of the Central Bank and Trust company of Asheville.

10. April 22, 1931 The Knoxville News-Sentinel Knoxville, TN
Article from The Knoxville News-Sentinel, April 22, 1931

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LEA INDICTED IN ASHEVILLE Evidence Shows He Told Banker Davis What to Reply In Communications. With Lea Jr. and Others of 'Kiting' One to Three Millions. TRIED TO HIDE EVIDENCE FRAUD IN DEALS, CHARGE Wanted to Compromise Obligations and Keep Damning Letters Out of Tennessee. against Luke Lea stands indicted letters which wrote B. Davis when Davis was dent Central Bank Trust Co. Lea said to have given tions kind letters to write' reply to telemessages that between them certificates deposit, letters of credit drafts. In letter Davis, for would firming our telephone conversation date, enclosing your letter of credit certificate deposit, other that Lea desired to enclose. The letters taken whole, said, showed president of Central Bank always did as rected in this correspondThe file taining the letters was found by Coursey special gating auditor Buncombe Coungrand jury. He turned them the grand jury, with other evidence found, and result indictment of Luke Luke Lea and Charlet, treasurer of the TennesAttorneys the learning that these letters had been found, efforts the monetary obligations Leas to the and the result that they have made definite offer of settlement claim of This offer to discussed Nashville between attorneys for Lea and the Nashville counsel for the Asheville bank receiver. One of the significant conditions proposed offer, according report, that the letters, which North Carolina expects to largely base its prosecution against the three Tennesseans, shall not be turned over to Tennessee authorities or used in the prosecution in Coursey expressed the opinion that after the use the letters in the North Carolina trials that they might be used by Tennessee officials, they will then be lic property He would not discuss the contents the letters, but their general ture was learned from another source. Giant Conspiracy Extending to New York and California Is Alleged. series true from the tie-up of millions dollars of city county funds here, the Buncombe County grand jury today had Luke Lea Nashville, Luke Lea his Charles cashier of the defunet Central Bank and Trust Company Asheville, and Charlet treasurer of the TennesPublishing Company, Nashville. Action was taken late Tuesday afternoon. The four were charged with between one and million dollars worth drafts, cashiers' checks, and certificates of deposthru Central Bank in an effort "benefit Lea, various persons corporations in which was interested. Indicted The Indictment which who allegedly lated state banking laws. Others indicted include Charles and city bond attorof the city former City Bartlett Bom and Newton Grimes and McElroy former Buncombe County officials. The former Mayor Gallatin Roberts. killhimself after the investigation begun. Trials for the defendants will open special Buncombe Court Monday McLendon, special prosecutor appointed Governor Max Gardner. direct the prosecution with Zeb Nettles, Buncombe County Davis will be to trial early, effort amass for Two cases docketed against Lea have been called the 20th and of May but length of trials will probably result in their being delayed. Conspiracy Is Charged to divert more than the Bank the issue of City of and notes charged against the officials. Malone and were linked the alleged defalcation the grand jury charges. The and county hope repudiate allegedly illegally issued charging that the same status as that of the Tennessee Highway now being questioned in connection collapse the well and the alleged loss state funds in Caldwell banks. Still indictments were Tuesday against Russell Davis and other offithe Central subsidiary Davis banks banking law charged in these Wallace Davis, against whom 16 indictments counts pending. indicted first the probe, March grand indicted elder younger Lea and Charlet. and charged they conspired the Davises to defraud Central Bank depositors out Drafts. cashier's checks. and tificates of deposit volved transactions, the jury charged The drafts allegedly payable to the Caldwell Bank Tennessee, the (Please Turn To Last Page)

11. April 28, 1931 The Item Sumter, SC
Article from The Item, April 28, 1931

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followed the state's motion yesterday for change of venire Counsel for defense contendpublicity bank failures subsequent ceedings bank and county officials, the most persons suffered financial resided in Buncombe county, would fair trial for the defendants here. Davis president the Central and Trust Company, the failure which other thousands of appeared unmoved his attorneys argued for moval from the tense atmosphere Buncombe county. lawyer's table stheargu lawyers' table the though without his

12. June 15, 1931 The Greensboro Record Greensboro, NC
Article from The Greensboro Record, June 15, 1931

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BANK RECEIVERS ARE UNDER FIRE Bondholders In Asheville Petition For Right to Intervene In Their Receivership ASHEVILLE June representing holders $13,000,000 of worth mortgage bonds issued by two subsidiaries of the funct Central Bank and Trust company here today petitioned for right intervene their receivership. The complaint that trustees and receivers have failed to collect $3,000,000 on guaranteed and that their activities are not beneficial to the bondholders The action is but one of the farreaching ramifications tangled finance resulting from the failure of the bank last Suits brought financial interests through. out the country are pending scores criminal actions resulted from the baning involved more than $20,000,000 The petition alleges that mortgage the Federal Mortgage of the Continental Mortgage company guaranteed by the United States Fidelity Guaranty company of Baltimore which has failed to pay federal and 000 of the continental paper. Against Company It also contends that activities the Real Estate Trust of (Continued on Page Nine.)

13. July 23, 1931 Evening Star Washington, DC
Article from Evening Star, July 23, 1931

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# PROSECUTOR SAYS LEA # MUST PRESENT PLEA Tennessee Indictment Abatement Arguments to Be Heard at Knoxville August 1. By the Associated Press. KNOXVILLE, Tenn., July 23.-William Carter, United States district attorney, announced yesterday that Col. Luke Lea, Tennessee published, indicted in Federal Court here on charges of violating national banking laws, must be present or represented by counsel in event his plea for abatement of the indictment is argued in Knoxville August 1. Rogers Caldwell, president of Caldwell & Co., investment banking house now in receivership, and J. Basil Ramsey, president of the defunct Holston Union National Bank here, are indicted jointly with Lea, and they have joined in making the abatement plea. Carter said their counsel have asked him to continue the abatement plea hearing, since Lea is scheduled to go on trial in the State Court of North Carolina at Asheville July 27 on charges arising from the failure of the Central Bank & Trust Co. there. "When the North Carolina case against Lea was originally set for July 13, I agreed to pass the hearing to August 1 to accommodate them," Carter said. "If they don't show up, I'll call for a bond forfeiture."

14. August 6, 1931 The Daily News-Journal Murfreesboro, TN
Article from The Daily News-Journal, August 6, 1931

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RECORDS CLOSED BANK PRESENTED ASHEVILLE TRIAL Volumes of Detail Testimony Offered In Lea Hearing AUDITOR TAKES STAND Several Records Presented Over Objections of Defense details of transactions forming the for charges of conspiracy to defraud the now closed Central Bank and Trust Company of Asheville of more than one millon dollars were expected to be deve+ in the trial of Luke Lea, loped today Nashville publisher, and three co-defendants. The state today through R. Vance Brown, former assistant auditor of the bank as evidence several records of the closed bank over objection the defense. Brown identified of records of the bank account with the Liberty Bank Trust Company Nashville which failed last fall, as well the deposit ledger, cashier's check ledger, and check ledger records. W. Coursey, special investigator of the solicitor generals office, was to follow Brown on the stand to explain as an expert several entries the bank cords, whose validity is questioned by the Volumnious volume of testimony regarding the manipulations of $1,300,00 in certificates of deposits, cashier's checks issued by the Central Bank to Lea compaines in which he was interested, is already befo.e the jury sitting in Buncome Court. On trial with County Superior Luke Lea. on the conspiracy to defraud charges, are his son, Luke Lea, Jr., Charlet, Nashville business associate, B. Davis, president of the and Central Bank whose failure last fall in- (Continued on

15. August 18, 1931 The Huntsville Times Huntsville, AL
Article from The Huntsville Times, August 18, 1931

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STATE NEARING END OF LEA BANK TRIAL ASHEVILLE, N. Aug. 18. (U S. Coursey, state bank investigator, was by the defense today in the trial of Col. Luke Lea, Nashville publisher, and three other defendants, on charges of conspiracy to defraud the now closed Central Bank and Trust Co., in an fort to show that the bank lost no money in its with Lea. His testimony summed up the entire case, and the state is expected to rest when he leaves the stand.

16. October 1, 1931 Asheville Citizen-Times Asheville, NC
Article from Asheville Citizen-Times, October 1, 1931

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TO REPORT ON CASE TODAY Instructed By Judge To Come Into Court At Nine o'Clock (Continued From Page One) and of Attorney Curtis for Harris heard When arguments completed shortly Judge Webb when he charge Judge Webb read the tentions the then contentions of the defendant Harris. later contentions defined law as It applies to evidence in the That Davis and Harris devised scheme to defraud: that the ported fraudulent scheme was to Central Securities company bonds the United States scheme defraud: that while the mails used by only one of the defendants in both collaborated the purported fraudulent scheme; that Central Bank Trust condition greatly the boom 1925-26 bank was insolvent and that Davis then conceived the Idea of getting money through sale of Central curities bonds for bolstering the bank: by Davis directors the company concerning mortgage panies acquired the untrue. and that Davis' recommendations part scheme his prevent withdrawal mortgage from the Central Bank; concerning the condition the tral Bank Trust company. sent out by mail, were untrue; that Central Securities company stock was sold on that the comwas being organized for industrial in North Caroand these were from those made in selling bonds; that Central Securities bonds were not guaranteed, there were surety bonds for bonds sold and the bonds and the company wise that the tral Securities being prosperous firm and dividends were paid when the company was in reality operating Claims Outlined The contentions as submitted by counsel cited the letters, statements and other dence supporting the charges of In answer, counsel for Davis submitted the following which were read to the jury "The defendant contends in this that the Central Securities organized conducted for an purpose: and his honesty purpose by the which he used in securing the Board the highest character and best business ability available in the city of Asheville: he contends that man intending to defraud would not careful select smartest most honest men he could control the company the best legal he could secure and the trust and bonds were prepared by Francis Heazel lawyer highest standing and ability. Purpose of Frm "The defendant contends the purpose of the securities was and sell mortbonds and in financing that the did to Western North Carolina desirable mortgage company bonds became difficult beuncertainty tate values. but large mortgage bonds falling due in November and Decemand in and 1932 that these bonds must be paid and account of the difficulty securing new mortgage bonds, the money the Central the off the maturities big and purchasing take their place: that he and the board directors considered that Central Bank and Trust company would carry and that the funds the that the Mr. Davis thought would merge the strong chain make the deposits absolutely safe beyond any doubt and also was carrying negotiations secure trusts to give liquid to the capital bank that had assurances from Caldwell and the and all of Lea's paid and money for November which would the bank ample that failure of and November plans entirely Central Bank funds the that run on his bank After the 10,000 PEOPLE Every day 10,000 people are changing to St. Joseph's Genuine Pure pirin. This tremendous swing Joseph's due to the fact that realize is neither sensible necessarry to more tablets of "Et Joseph's both now proof cellophane preserve purity full Joseph's you lets be druggist for Joseph's recommended physicians druggists everywhere the largest ing aspirin world failure of Caldwell and company caused the failure of his and prevented from paying off the which due in and and many account causes beyond control not carry the plans they and that inability his plans not that money in faith and all the members of the the fact that character did not protest strong evidence you should find. Out Copies that sent the dealers of the showed on its that deposit be that every was and that he had intended to all this the bonds cash would used: that matters legal counsel authorized by the board of directors defendant further contends that every statement truth and bond buyer ment fact the fendant contends that all his he was acting good faith that he believed his would carry that business conditions would money safe and that he had defrauding was of circumstance caused worldwide which has caused many banks business to fail, and beyond his return "The defendant that you should that he acted good faith every act done committed by him connection with Central Securities Company its very inception of the Bank Trust Comand resulting failure of Central Securities Company The defendant contends the original idea conceived by him. in the of Central Comwould which would valuable need the community would able to render service Asheville and Western North Carolina. The defendant contends that he spent considerable of his personal time and money of kinds in Western Carolina, and he had planned use the company in financing business and industry which would rehabiliWestern North Carolina, bring prosperity to the inhabitants The that after labor along became apparent due the general and pression in the States where was extremely to launch and were to fields or large Successfully Operated "The should find that became parent the industrial aims and plans the then conceived Central engage in the issuance and and the refinancing and refunding mortgage company bonds mortgage companies, had been profitably operated The Mortgage the part standing large financial and ready issued sold and twenty their The contends by the founder that the mortgage there was an tunity Asheville local pany. to engage the refinancing the pany and large cial in Baltimore Mary which making large its the and profits be made stock holders Thought Sound "The that such was entirely legitimate every and financial was fundamentally economically and defendant further that after part the vinced business and that he believed would benefit both the stockholders company the the company and The defendant contends that find the was the for placed charge board the leading and business men Central Securities began the its you the the Central was necessary for the Central curities company to put quate financial and itself the for take the the bonds The that should find that the Trust company subof the United States Fidelity and which had previously doing refinancing Companies and that Central of curities possessed sufficient handle the various and To Create Funds that you should find

17. May 14, 1932 Washington Daily News Washington, NC
Article from Washington Daily News, May 14, 1932

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COMMISSION MEETS Raleigh, May North Carolina Park Commission held meeting here discuss rontine business. Attorney General Brummitt told it to to recover the it lost in the failure of the Central Bank and Trust Company in Asheville will probably be tried in July.

18. July 28, 1932 The Omaha Evening Bee-News Omaha, NE
Article from The Omaha Evening Bee-News, July 28, 1932

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LUKE LEA, HIS SON AND DAVIS DENIED RETRIAL July 28 Luke Lea, former Tennessee senator and publisher. denied trial Thursday on violating the state banking New trials also denied Lea and Wallace Davis. former head the closed Central Bank and Trust Co. of Asheville.

19. December 21, 1932 Hickory Daily Record Hickory, NC
Article from Hickory Daily Record, December 21, 1932

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ARREST LEAS N. C. Court Mails Judgment To Asheville Today RALEIGH, Dec. The state supreme court this ternoon mailed Buncombe court the judgment the perior Luke Lea bank fraud case. As papers reach county take steps imprison the nessee and former Unit ed States collect $25,000 fine from Luke Lea, or imprison The judgment was certified to the lower court receipt notification from supreme court the United States of the termination of the futile Lea ap peal in that court. The supreme court had ordered its judgment which affirmed conviction the Leas in the $17,000.000 crash of the Central Bank and Trust company of Ashe ville. withheld until final action in the nation's highest tribunal.

20. December 22, 1932 The Asheville Times Asheville, NC
Article from The Asheville Times, December 22, 1932

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SCENE SHIFTS TO BUNCOMBE IN LEAS CASE High Court Judgment Received Here: Capiases May Be Delayed. LLETIN clerk superior Laurence and Lea. law violations been upheld the and state supreme courts. The scene shifted Buncombe and today Colonel publisher former United States term for conspiracy in nection with the affairs the closed Central Bank and Trust company The supreme final against Lea and denying relief to the 2 J Buncombe this Mr had issued the caplases for the at o'clock but was to fore was by Solicitor Zeb Nettles to the caplases but is probable that he will hold the the The Leas in the sheriff will not them they surrender and is not anticipated by court here Moves extradite the Leas and forfeit bond will not until the January criminal term of Buncombe county superior convening Monday. Jan the allowing Tenuntil that time was from to ten prison: his son from two with the alternative of paying $25,000 in fines.

21. January 23, 1933 The Shreveport Journal Shreveport, LA
Article from The Shreveport Journal, January 23, 1933

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ARRESTED Capiases Issued for Convicted Pair After Failure to Surrender at Asheville. (Associated Press.) ASHEVILLE. N. Jan. Luke Lea, Nashville publisher, and his son, Luke Lea, Jr., were called to surrender Buncombe county superior court today m., but they were not present, and capiases were ordered issued for their arrest. Cited on Two Charges. The Leas called to surrendunder two conspiracy and another for misapplication funds in connection with the closing of the Central Bank and Trust Co., of Asheville. The elder Lea, former Tennessee senator, is under of to 10 years in prison and his son under four with the option of paying $25,000 in fines and costs. When they failed to appear, So licitor Zeb Nettles said efforts to extradiate them from Tennessee would be made tomorrow. Leas Confer With Lawyers. Tenn., Jan. Informed that capiases their arrest had been issued today at Asheville, N. Col. Luke Lea and his son, Luke Lea, went into with their counsel in Nashville, and statement was promised later in the day. have just talked to Colonel Lea and Luke Lea, home,' said Percy Lea, another son "They are informed that capiases have been issued and are in ference with their attorneys. Colonel Lea expects issue statement himself about

22. March 14, 1933 The Oshkosh Northwestern Oshkosh, WI
Article from The Oshkosh Northwestern, March 14, 1933

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ARRESTED SET, Clarksville, few minutes after they had rested here today, Luke Nashville publisher and former United and his son, were granted by corpus County Judge John who set the hearing for Monday The arrests were made on warsigned Gov. Hill several weeks honored requisition from the governor North Carolina. were convicted at Asheville August, conspiracy to violate banking connection the failure of Central Bank Trust company. Colonel sentenced to serve six years given the option paying fines costs serving two to years prison.

23. March 15, 1933 The State Journal Frankfort, KY
Article from The State Journal, March 15, 1933

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LEA AND SON [Continued From Page One of violating State banking laws in connection with the collapse of the Central Bank and Trust Company. Lea was sentenced to from six to ten years in the State penitentiary and Lea, Jr., was given an alternative sentence of two to six years $25,000 in fines and costs. They were taken into custody warrant signed by Governor Hill McAlister on February when he honored requisition from the Governor of North Carolina for their removal to that State. Sheriff E. Beaumont of Montgomery county (Clarksville) made the arrests at the request of Sheriff Laurence E. Brown and Deputy Sheriff Frank Lakey, of Asheville, designated in the warrant as agents to return the Leas to North Carolina. Immediately after the Leas' arrest, County Judge John Cunningham granted writ of habeas corpus and set the hearing for 10 m. Monday. However, the judge refused application of the Leas' counsel for bond and they were placed in separate cells in the conty jail. Judge Cunningham also denied request by the Leas' counsel for an extension of time before the hearing. but said that necessary" continuance might be granted Monday. In their efforts to escape the sentences, the father and son carried their fight to the North Carolina Supreme Court and States Supreme Court, but without success.