Peoples Bank (Sanford, NC)

Episode Information

Episode Type
Suspension → Closure
Start Date
April 7, 1930
Location
Sanford, North Carolina (35.480, -79.180)
Bank Type
state
Routing Number
66-0666

Metadata

Episode ID
Bank ID
City ID
371022497
Model
gpt-5-mini
Short Digest

Notes

Closure followed cashier H. C. Newbold's confession of a $44,000 shortage; bank remained defunct with receivership and later dividend payments.

Events (3)
1. April 7, 1930 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Cashier H. C. Newbold confessed to a shortage/defalcation of approximately $44,000, prompting closure pending state examiners' audit
Newspaper Excerpt
the institution has been closed until the examiners and auditors could make examination of the books
Source
newspapers
2. April 7, 1930 Receivership
Newspaper Excerpt
E. L. Gavin, who was receiver of the bank until the state banking department assumed its affairs; there were approximately $280,000 on deposit when the bank closed.
Source
newspapers
3. March 14, 1935 Other
Newspaper Excerpt
Dividend of 20 per cent on all outstanding deposits in the defunct Peoples Bank has been ordered by Gurney P. Hood, state banking commissioner
Source
newspapers

Newspaper Articles (5)
1. April 8, 1930 The News and Observer Raleigh, NC
Article from The News and Observer, April 8, 1930

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Article Text

ADMITS SHORTAGE H. Newbold Confesses To Deficit of in His Accounts Sanford, April people Sanford surrounding community greatly shocked this morning when became known that H. Newbold, cashier of the Peoples' the Bank, had confessed to shortage of approximately $44,000.00 in his accounts, and had been arrested and placed Lee county The bank did not open for busi notice the signed by the officers and directors stated that the institution had been closed until bank aminers auditors could make examination of the books of the bank. This taken prevent the possibility of run the today. Arrive. Examiners Williams and John Campbell of the State Bank ing Department arrived last night the that Newbold recently placed in the bank his secured note the amount the The Saturday night President Snipes, and Vice President Gavin, with rectors went Sunday officers the State Banking They returned here last night with This morning o'clock upon warrant sworn out President Newbold was committed jail. He was have had prelimihearing this before justice of the peace this and he remain until the term court unless granted the meanwhile. not known what became the money Newbold steadfastly refused talk about the matter. Upon being questioned he replied are the books, look There feeling among number people here that shielding some one outside the bank. Lived Simply. native Elizabeth came Sanford September, when the bank organized and became cashier of the institu and has charge since has bad habits and has been held esteem high the community. He wife and children have simply modest bungalow Chisholm street. He the board deacons of the First Baptist church and church of the choir that church. He the American Legion and of the Sanford Kiwanis Insurance Company. The Realty Company, fire agency owned by has offices the the bank building but has the Newbold bonded in surety com pany for $25,000.00. bank strong board directors. that thought depositors will lose the audit large frozen assets. probabl plans that the tution will reopened. Page Trust Sanford's maining deposits today exceeded of the defalca has created surprise the leading topic conversation all sides today. BANKING DEPARTMENT IN The People's Bank of Sanford, which was closed followthe Cashier was capitalized $25,000, had and deposits about was by the statement the bank the State Banking Chief State Sunday by four rectors the bank sought advice situation. Mr. Mitchell John the They remained Sanford

2. April 8, 1930 The Herald-Sun Durham, NC
Article from The Herald-Sun, April 8, 1930

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Article Text

Proposed Prohibition Investigation Brings Fight Of Senate Drys H. NEWBOLD, OFF IN BANK FUNDS, HAS SIGNED CONFESSION People's Bank Of Sanford In Hands Of Examiners EXAMINATION IS WAIVED Cashier Of Institution Declines To Tell Where Money Went $44,000 had and county The did open for notice by auditors make of taken and the at began the the sum was number for the state They returned with He R. Rives, but Senator Brookhart Starts Battie Among Republicans By Accusing Secretary Melion Of Conducting Campaign Against Dry Law SENATOR FESS REPLIES Chairman Norris Says He Has Seen No Improvement in Enforcement And Reiterates His Belief That Politics Was Playing Part in in against the He demand another defended He opposed the as harmful Mitchell senate day frowned proposed pictured After eral before Norris The The next the the repeal The to Two)

3. April 8, 1930 News and Record Greensboro, NC
Article from News and Record, April 8, 1930

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Article Text

ADMITS SHORTAGE OF $44,000 Peoples Bank of Sanford Closed While Books of Cashier are Audited. HE REFUSES TO TALK Special Dally News) Sanford. April 7.-H. C. Newbold. cashier of the Peoples bank of Sanford. has confessed to shortage of $44,000 his accounts and is in Lee county jall awaiting the next term of criminal Superior court. Preliminary hearing for Newbold was to have held this afternoon before R. Rives, justice of the peace, but this was waived. The bank did not open for business today notice the door signthe officers and directors reads that institution has been closed until the examiners and can examination of the books This course taken prevent the possibility run the bank today Examand Campbell the arrived last night and at once began that Newbold had recently placed bank personal note for the amount sum taken was made Saturday night President Snipes Vice President who together and number to Raleigh Sunday for with banking turned here last night with the examiners. This morning warrant sworn PresiSnipes, Newbold was committed to is not known what became of the money, as Newbold steadfastto talk about the matter being replied There the books. look at them. There number people here that shielding the bank Newbold, native Elizabeth came Sanford in September 1919, when the bank organized became the He been then. has been held high esteem and his wife three children simply modest bungaHe the board the First church church treasurer. the that church. He the American legion and the Sanford Kiwanis Carolina InsurRealty surance agency owned offices the the bank building but has no connection with the Newbold bonded in surety comfor bank capital of $25,000 surplus undivided profits about with deposits officers are Benton, assistant cashier. and strong board directors not that the depositors lose anything unless audit large frozen that be that the institution be Page Sanford's remaining no today. Officers this nounced deposits today exceeded

4. April 10, 1930 The Chatham Record Pittsboro, NC
Article from The Chatham Record, April 10, 1930

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Article Text

Sanford Banker Shortage H. C. Newbold Confesses to Deficit of $44,000 in His Closed Newbold in Jail startling news that reached Pittsboro early Monday morning. the effect that Cashier Newbold of People's Bank, Sanford, was short and had been lodged jail. The following Sanford dis. patch in the News and Observer tells the story from the Sanford Sanford. April people of Sanford and surrounding community greatly shocked this morning when became known that H Newbold, cashier of the Peoples' Bank, had shortage in his accounts, and had been arrested and placed Lee county jail. The bank did not open for busi today and notice on the door signed by the officers and directors stated that the institution had been closed temporarily until the bank examiners and auditors could make of the books the bank. This course taken to prevent the possibility of run on the bank day. Examiners Arrive Examiners Williams and John Campbell of the State Banking Department arrived last night and at once began work on the books. understood that Newbold had recently placed in the bank his unsecured personal note for the amount of the sun taken. The confession was made on Saturday night President R. Snipes, and to Vice President Gavin, who together with Newbold and number of directors went to Raleigh Sunday for conference officers the State Banking De partment. They returned here last night with the examiners. This morning upon warrant out by President Snipes, was committed to He have had preliminary hearing afternoon fore R. Rives, justice the but this waived and he remain until the next of court unless hearing granted in the mean while known what became of the money as Newbold has steadfastly refused to talk about the matter. Upon being questioned he replied "there are the books, look at them. There feeling among number people here that he shielding some one outside of the Lived Simply Newbold, native Elizabeth City, came to Sanford in September, 1919. when the bank was or ganized and became cashier of the institution and has been charge then He has no bad habits and has been held high esteem He and children have lived modest bungalow He member board First Baptist church and Owned Insurance Company the bank building connection with the bank. Newbold bonded company for The bank has strong board directors. not thought that the depositors will lose anything unless the audit shows large amount of frozen It prob. able that plans will be made that the institution soon reopened. Page Trust Company, Sanone remaining bank experi-

5. March 14, 1935 The Sanford Herald Sanford, NC

Article Text

PEOPLES BANK TO PAY 20 PER CENT DIVIDEND $18,000 to Be Distributed to Depositors Within Next Few Days BOND IS COLLECTED Makes Total of 70 Per Cent Paid So Far; Not Final Dividend Dividend of 20 per cent on all outstanding deposits in the defunct Peoples Bank has been ordered by Gurney P. Hood, state banking commissioner, and checks are being written to be ready for distribution within a few days, it was learned this morning. Total amount to be paid will approximate $18,000. This payment is in addition to a 50 per cent dividend declared soon after the bank closed in 1930, and is not a final dividend, it was stated by E. L. Gavin, who was receiver of the bank until the state banking department assumed its affairs. There were approximately $280,000 on deposit when the bank closed. Declaration and payment of this dividend follows refusal of the United States supreme court to review decisions of lower courts awarding the bank the sum of $25,000 and interest from April 6, 1930, totalling $2,141.44, from the Fidelity and Deposit Company of Maryland, which was bondsman for H. C. Newbold, defaulting cashier. The bonding company had denied liability, claiming the defalcations of Newbold occurred over such a long period of time it was the fault of officials of the bank they were not discovered earlier. However, every court which heard the case found all the thefts from the bank occurred within a few weeks of the closing in April, 1930. The case for the bank was fought in the courts by E. L. Gavin, K. R. Hoyle, D. B. Teague and W. R. Williams. Those familiar with the case say it was won for the bank by diligent work and skilful presentation by the attorneys involved. After the bank closed and the bonding company refused to pay the $25,000 bond, suit was instituted. The case was referred to John J. Ingle, Winston-Salem, special master, who spent 12 days in Sanford taking evidence. His judgment that the bonding company pay the receiver of the bank the sum of $10,930.00 on the bond was appealed by both sides. Judge J. J. Hayes, federal judge of the middle district of North Carolina, next heard the case and rendered judgment for the bank for the full amount of the bond, plus interest. The bonding company appealed to the federal circuit of appeals at Richmond, which affirmed Judge (Continued On Back Page)