6673. Hanover State Bank (Hanover, KS)

Bank Information

Episode Type: Suspension → Closure
Bank Type: state
Start Date: May 14, 1920
Location: Hanover, Kansas (39.894, -96.879)

Metadata

Model: gpt-5-mini
Short Digest: 8a1cd590

Response Measures

None

Description

The Hanover State Bank closed voluntarily in mid-May 1920 (May 14 cited) due to tightening money market and overdue wheat loans/low reserves; subsequent examination revealed large shortages/defalcations and the bank was placed in receivership (receiver appointed May 24, 1920) and treated as a failure. No evidence in the articles of a depositor run prior to suspension.

Events (5)

1. May 14, 1920 Suspension

Cause: Local Shock
Cause Details: Tightening of the money market and inability of farmers to ship wheat left loans overdue and reserves low, producing excess of loans over deposits.
Newspaper Excerpt: The Hanover state bank closed its doors volutarily yesterday. Officials said the suspension was due to carrying overdue wheat loans because of failure of farmers to get cars to ship ... Reserves were low and their crops. the result was an excess of loans over deposits, it was stated.
Source: newspapers

2. May 21, 1920 Other

Newspaper Excerpt: Shortages of August Jaedicke, Jr., president and principal stockholder of the Hanover bank, continued to grow ... Walter E. Wilson, state bank commissioner, will name a receiver for the Hanover State bank in the next few days.
Source: newspapers

3. May 24, 1920 Other

Newspaper Excerpt: Warrants issued for J. H. Shugart charged with complicity with August Jaedicke Jr., the fugitive bank president; shortages estimated at $138,000 and possibly much larger; bank described as defunct.
Source: newspapers

4. May 24, 1920 Receivership

Newspaper Excerpt: Developments in the Hanover State Bank case today included ... the appointment of a temporary receiver for the bank. Dugald Spencer appointed receiver of Hanover Bank.
Source: newspapers

5. September 15, 1920 Other

Newspaper Excerpt: Reorganization of Hanover State Bank to be attempted ... bank was closed several months ago when Jaedicke disappeared and it was found that his accounts were short $180,000.
Source: newspapers

Newspaper Articles (11)

1. May 18, 1920 The Daily Gate City and Constitution-Democrat Keokuk, IA

Article from The Daily Gate City and Constitution-Democrat, May 18, 1920

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Two Banks Fail. [United Press Leased Wire Service. ] TOPEKA, Kansas, May 18.-Tightening of the money market was indirectly held today to be responsible for the failure of two Kansas banks yesterday with slight losses to depositors. The Hanover state bank closed its doors volutarily yesterday. Officials said the suspension was due to carrying overdue wheat loans because of failure of farmers to get cars to ship Reserves were low and their crops. the result was an excess of loans over deposits, it was stated. Z. O. Johnson, cashier of the Auine bank, is said to have confessed that he borrowed $86,000 of the bank's funds to build up a stock farm. High cost of labor and food made the farm a "white elephant."

2. May 21, 1920 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, May 21, 1920

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TO NAME RECEIVER Hanover Bank Shortages IncreaseJaedecke Is Still Missing. Walter E. Wilson, state bank commissioner, will name a receiver for the Hanover State bank in the next few days. Announcement. of the plan to put the bank in the hands of a receiver was made by Ed Chapman, state examiner, in charge of the Washington county institution. Shortages of August Jaedicke, Jr., president and principal stockholder of the Hanover bank, continued to grow as the state bank examiners made a further investigation of the bank's securities. It is possible, according to reports from Hanover, that Jaedicke's shortages may total $150,000. The bank is not under the state bank guaranty laws. No word has been received from the missing bank president. He had a full four days' start on the state if he sought to escape from justice. It was three days after his closing of the bank that the first intimation of shortages was given. the public. Jaedecke left Hanover in his motor car. Rewards have been offered for his arrest, but no news has come as to his probable location at this time. Commissioner Wilson is in Wichita today. He will return to Hanover Saturday and may name a receiver for the bank at that time.

3. May 24, 1920 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, May 24, 1920

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August Jaedicke Did Not Loot Safe Deposit Vault. Dugald Spencer Appointed Receiver of Hanover Bank. NET SPREAD FOR SHUGART Nebraskan Believed to Have Engineered "Kiting" System. Depositors Meet to Discuss Settlement of Trouble. Hanover, Kan., May 24.-August Jaedicke, Jr., president of the Hanover deState bank, did not loot safety posit boxes in his institution, accord- afting to information available this ernoon. A number of safety boxes were opened today. Patrons found ditheir securities intact. Shortages rectly chargeable to the bank are now estimated at $138,000. Jaedicke's personal defalcations may boost the community's loss to $500,000. Causes Great Relief. Walter E. Wilson. state bank commissioner, is here with S. N. Brewster, John former attorney general, and Hunt. Both Brewster and Hunt bank have been specially retained by the of commissioner to direct settlement legal tangles growing out of the bank trouble. True relief was felt in Hanover that towhen first reports indicated Jaeday in safety boxes in the were safe. a securities dicke bank With the seem- commountain high loss for munity ingly thru the bank president's felt manipulation of funds, fear was been that safety box patrons may have victims. added to the list of Jaedicke's Receiver Is Appointed. Depositors of the bank will meet for today to discuss methods trouble. late of the banking settlement community is seemingly Numerous pleased The present procedure. have with conservative business men radi- secriticised and condemned newspapers. verely cal reports sent to certain made Reports that threats had been were deCommissioner Wilson appeals against were statements that for nied, been as sent to Governor Allen had his removal from office. Wilson today announced appointof Dugald Spencer,forme moyor ren ment Hanover, as temporary of for the bank. Spencer bank imceiver arranged to enable boxes. mediately to inspect their safety permanent patrons appointment of a to GovPending Wilson appeal in y n receiver. Allen for additional rewards hunt y ernor with the nation-wide president of connection Jaedicke, Jr., and bank it for August whose personal million the shortages bank, may exceed a half 1, dollars. Warrants Out for Shugart. r. were issued today for the it Warrants of C. E. Shugart, of Lincoln, from 's arrest according to information with y Neb., Shugart is charged his is Hanover. Jaedicke in carrying out theory sysaiding loot of the bank. One that Shuf tematic failure is to the effect a "kitn of the associates employed bank ing" gart system and and that Jaedicke's a victim. was not known whether Shugart Nes e It is prosecuted in Kansas been or arwill be Jaedicke has not week 1, e braska. rested, altho he left his bank a ago. n Letter Tells of Shortages. letter from Jaedicke and to 1a A lengthy telling of bank shortages to e his wife his deeds, was reported Wilienumerating possession of Commissioner such be in Jaedicke has denied admits one a al son. Mrs. to her. She but :letter came received, it is reported. husband e flatly letter was denies claims that her his defalcations. [e it outlined the Hanover bank, which examiners in a iIn found a check ledger transe have shows Jaedicke's much d large degree This book will be of knotted et actions. in straightening out banker's problems value surrounding the transactions.

4. May 24, 1920 The Evening Herald Albuquerque, NM

Article from The Evening Herald, May 24, 1920

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Warrant for Man in Kansas Bank Failure BY THE ASSOCIATED PRESS TOPEKA KANS. May 24.-Developments in the Hanover State Bank case today included the issuance of a warrant for the arrest of J. H. Shugart, of Lincoln Nebraska charged with complicity with August Jaedicke Jr. the fugitive bank president, and the appointment of a temporary receiver for the bank.

5. May 25, 1920 The Morning Tulsa Daily World Tulsa, OK

Article from The Morning Tulsa Daily World, May 25, 1920

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BANK WRECKER IS SOUGHT Warrant Issued for Nebraska Man in Failure of Kansas Bank TOPEKA, Kan., May 24.-Deveopments in the Hanover State bank today included the issuance of a warrant for the arrest of J. H. Shugart of Lincoln, Neb., charged with complicity with August Jaedicke jr., the fugitive bank president, and the appointment of a temporary receiver for the bank. Accorling to information obtained at the bank commissioner's office today, the warrant for Shugart was issued at Hanover and charges Shugart with aiding Jaqdicke in a systematic looting of the bank. Whether Jaedicke was a factor in or a victim of the allegel "kiting" of checks and securities ,which is said to have been instrumental in the wreckage of the bank, has not been determined, officials say. HANOVER, Kan., May 24.-One of the first acts of the temporary receiver of the defenct Hanover State bank today was to permit those having safety deposit boxes to inspect them. These patrons reported the contents of their boxes were intact.

6. May 25, 1920 Pine Bluff Daily Graphic Pine Bluff, AR

Article from Pine Bluff Daily Graphic, May 25, 1920

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TWO Charged With Looting of Bank Hanover, Kan., May 24.-One of the rst acts of the temporary receiver the defunct Hanover State Bank day was to permit those having fety deposit boxes to ispect them. hese patrons reported the contents their boxes were intact. Topeka, Kan., May 24.-Developent in the Hanover State bank case day included the issuance of a warnt for the arrest of J. H. Shugart f Lincoln, Nebraska, charged with omplicity with August Jaedicke, Jr., he fugitive bank president, and the ppointment of a temporary receiver or the bank. According to information obtained the bank commissioner's office toay the warrant for Shugart was isued at Hanover, and charges Shugart ith aiding Jaedicke in a systematic poting of the bank. Whether Jaed-

7. September 15, 1920 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, September 15, 1920

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# FRIENDS OF JAEDICKE HERE Reorganization of Hanover State Bank To Be Attempted Today. Hanover friends of August Jaedicke, Jr., were to meet here today in the offices of State Bank Commissioner Wilson to attempt to reorganize the Hanover State bank which was closed several months ago when Jaedicke disappeared and it was found that his accounts were short $180,000. Dougald Spence, who was appointed receiver for the bank by Wilson, will attend. It is said that 100 of Jaedicke's friends have agreed to put up $1,000 each and they believe that this, together with the money Jaedicke can raise, will wipe out the losses.

8. April 7, 1921 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, April 7, 1921

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ASK CHANGE AT HONOVER Delegation Requests New Receiver in Defunct Jaedicke Bank. Frank H. Foster. state bank commissioner, has been urged by a delegation from Hanover to change receivers of the defunct Jaedicke bank. Supporters of the proposed change, as well as opponents of the proposition, appeared before the state commissioner. The bank. according to estimates by John Hunt. Topeka attorney, will not pay creditors more than 50 per cent. Dugold Spence was named by Walter E. Wilson as receiver for the Hanover State bank when August Jaedicke's failure became known. Since Spence's appointment the bank has been reorganized. Officers of the new bank want T. J. Martin appointed. Other bankers in Washington county, including Senator R. J. Hyland, opposition banker, declared the state department should make no change in the receivership. Such action. they said. would give undue advantage to the reorganized institution.

9. September 27, 1921 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, September 27, 1921

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BANKS DID WELL Made Good Record During Financial Depression. More Than 1,100 Now in Operation in Kansas. SEVEN FAILURES THIS YEAR Mismanagement and Dishonesty Given as the Cause. Heaviest Losses of Year Were Hanover and Coffeyville. The failure of two Kansas banks in September brings the totals to seven for the year to date and to twelve for the period of deflation, since May 15, 1920. "Kansas banks have weathered the storm of financial depression remarkably well," said J. H. Sandell, assistant state bank commissioner. "Where twelve state banks have failed more than 1)100 have continued to operate. Investigation has disclosed that the banks which have failed have done so in practically every instance because of mismanagement or dishonesty of officials. In most instances bank cashiers and other officials stole from bank funds to speculate in oil or other enterprises. When deflation came their holdings diminished and they were unable to make good their thefts as they undoubtedly had hoped. Readjustments Are Made. "Where bank officials were honest and the great majority of them are -the banking department has worked successfully with them to make the necessary readjustments to meet new conditions." Sample reasons shown for failures in the past are: "Cashier speculated in oil and lost." "Negligence on the part of bank directors and speculation on part of acting officers." "Defalcation of cashier. He dealt extensively on board of trade and covered up losses with forged papers." From 1900 to 1919 inclusive there were twenty bank failures in this state or an average of one a year. From 1892, when the first failure was recorded after establishment of the banking department, until 1899 there were 69 failures. Thirty-three of these were in 1893, the panic year. Numerous other banks closed temporarily. In Kansas bank failures of the last two years, the heaviest losses to depositors probably will be in the Hanover State Bank of Hanover and the Peoples State Bank of Coffeyville, the banking department believes. There is no way to estimate the exact loss until numerous law suits are decided. Seven Were Guaranteed. Seven of the twelve defunct banks were guaranteed under the depositors' guaranty law. Neither the Hanover nor the Coffeyville bank were guaranteed. In the other three non-guaranteed banks present indications are there will be no losses to depositors. Of the seven guaranteed banks it now appears at least three and possibly five will require drafts on the guaranty fund. List of Bank Failures. The list of failed banks follows: The Aulne State bank, Amine, (guaranteed), May 15. 1920. The Hanover State bank, Hanover, May 14, 1920. The Farmers State bank. Wamego, $25,000 capital, October 14. 1921. The Homewood State bank. Homewood, $10,000 (guaranteed), December 6. 1920. The Wellsford State bank, Wellsford, $10,000, December 18, 1920. The People's State bank, Coffeyville, $25,000. January 20. 1921. The Farmers State bank, Le Loup, $10,000 (guaranteed), February 4, 1921. Kansas The Banking Trust company. City, Kan., ($100,000), April 23. 1921. The People's State bank. Salina ($100,000). guaranteed, July 18, 1921. The Farmers State bank, Spring Hill, $20,000 (guaranteed), August 8. 1921. The Citizens State bank, Manhattan, $50,000 (guaranteed), September 19. 1921. The Farmers State bank. McCune, $15,000 (guaranteed), September 22, 1921.

10. March 11, 1922 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, March 11, 1922

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# SUPREME COURT DECISIONS The following opinions were handed down today by the supreme court: By Johnston, C. J. The Farm Mortgage Trust company, plaintiff, vs. Franklin H. Foster, et al., defendants. Original proceeding in mandamus. Writ allowed. Bradley Vrooman Co., appellant, vs. W. A. Summer, appellee. Appeal from Montgomery county. Dismissed. Hannah Vann, appellee, vs. Missouri, Kansas & Texas Railway company, appellant. Appeal from Labette county. Reversed and remanded with direction to enter judgment for defendant. The Tropicai Paint & Oil company, appellant vs. The People's State Bank, appellee. Appeal from Saline county. Affirmed. Charles Caton and William Starr, doing business under the firm name and style of Caton & Starr, appellants, vs. The Board of County Commissioners of Osborne county, appellees. Appeal from Osborne county. Reversed and remanded. The Four-S Razor company, appellant, vs. E. T. Guymon and C. A. Ryker, trustee, appellee, Appeal from Reno county. Affirmed. The State of Kansas, appellee, vs. Jack Copelman, appellant. Appeal from Johnson county. Affirmed. By Burch, J. State of Kansas, appellee, vs. Elias Smithhisier, appellant. Appeal from Harper county. Affirmed. State of Kansas, appellee, vs. Etta Lower, appellant. Appeal from Douglas county. Affirmed. Ella Stover, etc., appellee, vs. James Davis, and J. A. Aylward, etc., appellants. Appeal from Butler county. Reversed and remanded for judgment for the defendants. William Schlotthauer, appellee, vs. N. J. Greenfield, appellant. Appeal from Marion county. Affirmed. State of Kansas, appellee, vs. Harry T. Breen, appellant. Appeal from Trego county. Reversed and remanded with directions to quash the information. By Mason, J. Theodosia Davies, Admx., etc., appellee vs. Norman Lutz and Louise Lutz, appellants, et al. Appeal from Harper county. Affirmed. Nora C. Mollchan, appellee, vs. H. H. Patton, et. al., appellants. Motion for rehearing overruled. Stroup Lumber Co., etc., appellant, vs. Wilson C. Larmor, et al., appellees. Appeal from Finney county. Affirmed. Joshua Stevens, et al., appellees, vs. Einma Dimke, et al. (The State Board of Administration, appellants). Appeal from Sumner county. Order denying board's application is reversed and cause remanded with directions to grant the application. West, J., dissenting. W. J. Holman, appellant vs. Ethel B. Joslin, et al., appellees. Motion for rehearing overruled. John Kesi, et al., appellees, vs. The Hanover State Bank, et al., (Douglas Spencer as Receiver, sub-defendant, appellants). Former opinion of affirmance adhered to. J. N. Parkham, vs. Francis S. McCarty, et al., C. C. Isely Lumber company, appellant: S. Schulman, appellee. Appeal from Finney county. Affirmed. The Goodyear Tire & Rubber Co., etc., appellant vs. the Hanover State Bank, etc., et al., appellees. Former opinion of reversal adhered to. The City of Cimarron, appellant, vs. The Midland Water, Light & Gas Co., etc., et al., appellees. Appeal from Ford county. Affirmed. By Porter, J. Mima Reddy, Ex'x. etc., appellant, vs. R. H. Graham, et al., appellees. Appeal from Harper county. Affirmed. The Joplin Erie Oil Co., appellee, vs. Laura Buckwalter, appellant. Appeal from Neosho county. Amelia F. Ehrhart, et al., appellees, vs. Jacob Bausch, et al., appellants. Appeal from Jackson county. Affirmed. Ira J. Stice, appellant, vs. James Cox Davis, Federal Agent of railways, etc., appellee. Appeal from Labette county. Reversed with instructions to overrule the demurrer to the evidence. The Southwestern Coal Co., appellant, vs. R. Calbeck, appellee. Appeal from Pratt county. Affirmed. Fairbanks-Morse & Co., appellant, vs. Farmers Union Elevator Co., appellee. Appeal from Lyon county. Affirmed. By West, J. Peter F. Winterscheidt, et al., vs. Edward Peter Winterscheidt, etc., F. M. Wilson, et al., appellants, Len Roberts, appellee. Appeal from Brown county. Affirmed. John W. McAuley, appellee, vs. Clyde E. Siscoe, appellant, et al. Appeal from Leavenworth county. Reversed and remanded for further proceedings. James B. Dill, et al., appellees, vs. The Kansas Casualty & Surety Co., et al., Continental Casualty company, appellant. Motion for rehearing denied. Thomas G. Finn, appellee, vs. The Kansas Casualty & Surety Co., et al. The Continental Casualty company, appellant. Motion for rehearing denied. Hugh R. Kautz, appellant, vs. John Shrimplin, appellee. Appeal from Osage county. Affirmed. William O. Hannaberry, a minor, etc., appellant, vs. Otto Erhardt, et al. Appeal from Ellsworth county. Affirmed. Polly Casebeer, et al., appellees, vs. The Carbon Coal Co., appellant. Appeal from Cherokee county. Affirmed. By Marshall, J. L. S. Cott, appellant, vs, John H. Baker, et al., appellees. Appeal from Shawnee county. Reversed and remanded with directions to dismiss the action without prejudice to future actions. John Fooke, appellee, vs. Rosa Havel, appellants, et al. Appeal from Rawlins county. Affirmed. Anna Bird, appellee, vs. The Aetna Building & Loan Association, appellant. Appeal from Wyandotte county. Affirmed. Wilbur M. Ferguson, appellant. vs. Fred Nuttleman, et al., Rosa Nuttleman and Carl Brandt, appellees. Appeal from Barton county. Judgment quieting title to lot in Carl Brandt affirmed. Judgment as to Rose Nuttleman reversed and remanded with directions to render judgment foreclosing mortgage on lots 10 and 11. State of Kansas, appellee, vs. Addison P. Moore, appellant. Appeal from Stafford county. Affirmed. By Dawson, J. Johanna Nash, appellee, vs. Agnes Harrington, et al., appellants. Appeal from Russell county. Reversed and remanded for judgment in favor of defendants. Lissie Coulson, et al., appellants, vs. Merle E. Hinton, et al., appellees. Appeal from Cowley county. Affirmed. Fred D. Emry, etc., appellant, vs. A. J. Cripes, et al., etc., appellees. Appeal from Reno county. Reversed and remanded for further proceedings. Dawson, J., Porter, J., and Marshall, J., dissenting in part. M. E. Petefish, appellee, vs. F. D. Morrison, appellant. Appeal from Linn county. Affirmed. State of Kansas, appellee, vs. Ben Wolkow, appellant. Appeal from Reno county. Affirmed. A. E. Stanhope, appellee, vs. Rural High School District No. 1, etc., appellant. Reversed and remanded for judgment in favor of defendants,

11. September 20, 1922 The Topeka State Journal Topeka, KS

Article from The Topeka State Journal, September 20, 1922

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STATE CONTROLS TEN BANKS B. V. Curry Is Official Receiver for All Institutions. Ten state banks are now closed and under control of the state bank commissioner. B. V. Curry, an assistant bank commissioner, is the official receiver of all ten of these institutions. In addition to the ten, there are nine banks in the state now operating under individual receivers. The ten banks under state control and of which Mr. Curry is receiver: Farmers' State bank, Washington. State Savings bank, Leavenworth. Farmers' State bank, Quenemo. C. M. Condon & Co., State bank, Oswego. Traders' State bank, Arkansas City. Citizens State bank, Geuda Springs. Exchange State bank, Wichita, State bank of Hope. Citizens' State bank, Harper. Farmers State Bank, Belmont. Mr. Curry has just been appointed receiver of the Citizens State Bank of Harper, the last bank to be closed by State Bank Commissioner Foster. Following -are the institutions now operating under private receivers: Citizens State Bank, Manhattan. People's State Bank. Salina. Broeker-Lefferdink Bank, Salina. Farmers and Merchants Bank, Pawnee Rock. Farmers State Bank, McCune. Viola State Bank, Viola. Aulne State Bank, Aulne. Hanover State Bank, Hanover. Farmers State Bank, Spring Hill.