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BELIEVE NOTES GOOD Receivers of Bank at Kokomo Hope $100,000 May Be Realized. By Times Special KOKOMO, Ind., Oct. 11.-Receivers for the American Trust Company, the bank which was closed recently by the State banking
American Trust Company (Kokomo, IN)
Episode Information
- Episode Type
- Suspension → Closure
- Start Date
- September 14, 1927
- Location
- Kokomo, Indiana (40.486, -86.134)
- Bank Type
- trust
- Routing Number
71-0142
Metadata
Events (2)
1.
September 14, 1927
Suspension
- Cause
- Government Action
- Cause Details
- Closed by state bank examiners on Sept. 14, 1927
- Newspaper Excerpt
- the bank was closed by the State bank examiners Sept. 14
- Source
- newspapers
2.
October 11, 1927
Receivership
- Newspaper Excerpt
- Receivers for the American Trust Company, the bank which was closed recently by the State banking
- Source
- newspapers
Newspaper Articles (21)
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LOCAL MEN TO TESTIFY Two Called in Probe of Closed Kokomo Bank's Affairs. Bu Times Special KOKOMO, Ind., Dec. 5.-Witnesses called to appear this week before the grand jury here investigating affairs of the closed American Trust Company Bank, includes: Clyde R. Humston, of the City Trust Company, Indianapolis; Boyd Gurley, editor of the Indianapolis Times; T. F. Barr and T. R. Inwood, deputy State bank examiners; Grover Bishop and J. C. Herron, receivers of the bank,
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Ex-State Treasurer Asked to Pay Back Commissions on Big Deposits. Suit to recover $11,500 from former State Treasurer Ora J. Davies, said to have been paid him by the now defunct American Trust Company, Kokomo, for keeping large amounts of State funds in that institution, has been filed in Howard Circuit court. Joseph C. Herron and Grover Bishop, receivers for bank, closed by the State bank examiners Sept. 14, filed the complaint. Davies served two terms as State treasurer, from 1920-1924 He is considered a lieutenant of Senator James E. Watson's Republican faction and managed the campaign of Senator Arthur R. Robinson last year. Obtained Commission The fact that he had received 1 per cent commission for the State deposits first was made public by The Indianapolis Times. A Times representative was called before the Howard County grand jury. The suit charged that Davies colelcted $6.500 from the bank for an average of $165,000 of State money deposited in the bank while he was State treasurer. Davies did not account for the $6,500 as treasurer of State and appropriated the sum to his own use, the suit alleged. About the time he retired from office Davies, with the consent and on the order of the State finance board, increased the amount of State funds on deposit with the American Trust Company to $225,000, it is charged. Ignores Conference Request From the last of January, 1925, until March, 1927, the bank paid Davies 1 per cent a year on that amount on his representation that he would cause the $225,000 deposit to be withdrawn, if he were not paid, the suit alleged. A total of $5,000.00, $187.50 a month, was unlawfully paid Davies after he left the treasurer's office. the receivers charged. The receivers declare they wrote to Davies several weeks ago and informed him of their claim and that they would fine suit, but Davies has ignored their requests for a conference.
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DAVIES' RESIGNATION AS BANK RECEIVER Dec. resignation Davies, Kokomo, as for the First National bank of Sheridan and the First National bank, of Noblesville, accepted today by Joseph McIntosh, comptroller currency. Davies, former state treasurer recently indicated by the Howard county, Indiana, grand jury in connection with affairs of the American Trust company, of Kokomo. The that Davies, while treasurer, received money from American Trust company. The trust company was closed months order of the bank examiner. lengthy investigation by the Howard county grand jury resulted indictments against Davies; Luther W. Symons, state banking commissioner; Thomas Barr, deputy commissioner; Frank Owens, president the institution time it was closed, and several others.
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ORA J. DAVIES RESIGNS POST Dec. ignation of Ora Davies, of Kokomo, Ind., receiver for the First National Bank Sheridan and the First National Bank of accepted to-day by Joseph of currency Davies, former treasurer. recently was indicted by Howard county, Indiana, grand jury in connection affairs the AmerTrust Kokomo, Ind. The indictment charged that Davies, while treasurer, unlawfully received money from the American Trust The company was closed few the state the grand Luther Symons, state banking commissioner: Thomas Barr, deputy commissioner: Frank H. the was closed, and several others.
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STEPHENSON ASKED ABOUT BANK AFFAIRS AT KOKOMO MICHIGAN CITY, Ind., State prison officials today awaited the arrival the Howard county prosecutor and one of the receivers the American Trust company, Kokomo, life of checks paid him from the bank October, 1922 1923. grand dragon Klux Klan the time and Trust time was the depository klan money in the Kokomo district. Stephenson, has been much in limelight as result of his political the be every opportunity talk to the bank receivers, Homer R. Howard county and Grover Bishop. one the bank's receivers, Kokomo presumably for Michigan City to They understood have learned that Stephenson "had something to tell them" regarding the checks ceived. checks in amount from $2,400, many of them only few days apart.
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STATE OF INDIANA WILL LOSE IN BANK FAILURE Kokomo. Ind., Dec. 31.-The state stands to lose $55,000 of the $160,000 in state funds on deposit at the American Trust Company, which closed its doors last September, according to Grover Bishop, one of the receivers. Bishop declared although the state has been able to collect $37,000 of the money, it can only file a common claim for the balance and will lose approximately $55,000 since it is expected the receiver will not be able to pay more than 25 per cent to depositors The suit in the DeKalb circuit court of the Ashley State bank against James B. Whysong to foreclose mortgage on real estate has been dismissed.
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PLAN SYMONS' CASE Bank Chief Asked Receiver, Defense to Show. Defense of Luther F. Symons, State bank commissioner, and Thomas Barr, assistant, on the charges of neglect of duty in connection with the crash of the American Trust Company Bank at Kokomo will be that they complied with the law by asking appointment of receivers for the bank as soon as they knew it was in an unsound condition, it was indicated today. Symons received an opinion from Attorney General Arthur L. Gilliom, which he had requested, that the 1921 statute repeals an 1893 statute governing what course the State banking department should take in regard to an unsound bank. The 1921 act provides the State officials should ask for a receiver while the 1893 act requires the State officials to report the matter to the prosecutor.
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The KNIGHTSTOWN BANNER Entered at the Postoffice in Knightstown, W. K. DEEM and R. D. SHIPMAN Editors and Publishers Soiled feet usually accompany those who play at politics. That bank suspension up at Ko komo is taking on a bad smell Walter S. Chambers, editor of The New Castle Daily Times, is in Wash ington, D. C., on a sightseeing trip. He joined a party of friends at Indianapolis. With machine gun battles taking place every day in the city of Chicago why the necessity of sending U. S. troops to quiet the turbulent country of Nicaragua Republican district committeemen of Indiana met yesterday (Thursday) at Indianapolis to elect a state chair man in place of Clyde Walb, who handed in his resignation on Tuesday. D. C. Stephenson is to have another vacation from the state penitentiary. He is coming down to Kokomo to tell the Howard county grand jury what caused the American Trust Company to "bust." Stephenson says his tes timony will involve bankers in all parts of Indiana Opinion prevails there is some rottenness hidden away in the vaults of the Kokomo, bank
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WRECEIVER Hartman, Columbus, Ohio, New Appointee Hartman, Columbus, has arrived and taken charge of the First National Bank receiver, having pointed by controller of curWashington. He came rency here from Acherman. Miss., where was stationed for some time similar He connected with federal department of banking and has the years. He many takes the place made vacant the resignation Ora Davies, komo, did not wish to fill the position following indictment the Howard county grand jury out of the failure the growing American Trust Company, of that After his resignation the controller the currency here take charge of the local bank, but this appointment only temporary. Mr. Hartman has planned here, he until affairs of the bank are settled.
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THURSDAY, FEBRUARY 16, 1928. WOULD PAROLE BANK CASHIER Petition to Free Official If He'll Return Money By United KoKoMo, Ind., Feb. 16.-A petition was circulated here today asking parole for Frank S. Owens, cashier of the defunct American Trust company of this city, on condition that he return $23,000 to the bank's receivers and turn state's evidence against others indicted in connection with the bank's failure Prosecutor Homer R. Miller op poses the movement on the ground that Owens should be forced to return $38,000 due for assessments in addition to other monies allegedly owed the Eleven persons are under indict ment in connection with the failure of the company, which was depository for large amounts of state funds during the Ku Klux Klan regime in These include Luther Symons, state bank commissioner: Thomas Barr. assistant commissioner: Ora Davies, state treasurer at the time state funds were deposited there, and who is said to have received one per cent on all such monies: W. H. Arnold. former president of the bank, and Owens, his son inlaw and president of the bank at the time failed The bank is said to have failed because of large overdrafts and unsecured loans. Among the latter is said to be which Arnold. It is charged, borrowed from his own bank without security.
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GUARD FACTS KOKOMO CASE (Continued from Page because of necessity Stephenson to Be Called. Especial Interest attaches to the of the grand Jury for the reas that Prosecator Miller recently de clared that he will call Stephen son before the body to testify rela five the failure of the American Trust Company and $30,000 in cash ler's made out to the former Klan dragon which were found by re reivers for that institution The fall of the bank resulted in the indict rient of eleven persons ncluding Le then Symons. state bank commis sioner: Thomas D. Burr deputy bank mer state treasurer the bank who was also indicted. him having proved the Arnold in Judge Marshall said today that he ecided upon his program of secrecy "As it. the newspapers really to blame for the failure of Prosecutor and Sheriff John Spear man to bring Arnold the judge said that case had been kept quiet it would have been possible to make much better headway
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$4,000 IS ADDED TO BANK ASSETS KoKoMo, Ind., Feb. Addition of $4,000 to assets of closed American Trust company bank here has been made through payments on claims of the bank against the estate of Herman Mitchell. receipt of the money. which was part payment, Grover Bishop, one of the bank receivers, said another distribution of money would be made to depositors within about six months. He expects ten percent payment previous one was 20 percent.
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GRAND JURY BEGINS TRUST FIRM PROBE Failure of American Company, of Kokomo, Investigated; Stephenson Summoned DRAGON TO TALK KLAN Warren T. McCray diana Governor Testify at Hearing of the free American free of by formally begun means jury, Howard County operations were whose by of the HowJohn Marshal and Judge Circuit court. D. Stephenson. former grand dragon of the Indiana Ku Klux Klan, is to be brought from state prison at Michigan City, where he is life prisoner, to be one of the first witWarren McCray, former governor of Indiana, and the state's star witness in the recent trial of Gov.) Ed Jackson, may also testi- Failure of the American Trust company several weeks ago resulted in indictments against Ora Davies, former state treasurer and others Among these was William H. Arpold. former president of the bank, now in Florida Efforts to obtain extradiction of Arnold failed In returning to Kokomo today to tell his story of "amazing intrigue" which he told Miller and Grover Bishop, one of the bank receivers, he could unfold, Stephenson resists the scenes of his installation of grand dragon of the glan. He was placed in office here in 1923 before a klan gathering of 40,000 people. The story told to the grand jury by Stephenson is expected to be adbstantially the same as that he related tto Miller and Bishop severweeks ago, when he told how score more of politicians were "milking". the banks of the state by charging interest on deposits of state money
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PICK JUDGE TO TRY SYMONS AND BARR KOKOMO, Ind., April P. Brown of this city has been selected as special judge to try the case of Luther F. Symons, state bank commissioner. and Thomas D. Barr, his deputy, who were indicted by the Howard county grand jury in connection with the failure of the American Trust Company, it was announced today.
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DAVIES RELEASED FROM INDICTMENT Statute of Limitations Responsible for Quashing of Charges Ind., May Davies, former state today the ranks of among have been released by special jurige from indictments Howard grand jury in the county nection with the failure the Kokomo, which ican Trust Company slated to be the official klan bank Indiana. The statute of limitations was for the quashing the sponsible Davies, who accorddictment against to charges, while state treasand while one of those directing the deposits of state funds, collected cent on the moneys the received for deposit the bank. Special Judge John Joyce of Howard county circuit court ruled that the state had not proved active cealment the alleged irregularity and that consequently the limitations statute prevented Davies still faces civil suit brought by the bank receiver recover Alleged to have been collected by Davies, was for United States Senpaign ator Arthur Robinson in
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# THREATENS TO # MAKE ANOTHER # PROBE OF BANK Prosecutor Aroused Over Missing Papers in Kokomo Case. By Times Special FRANKFORT, Ind., Oct. 26.- Trial of Frank S. Owens, charged with embezzlement in connection with the American Trust Company bank failure at Kokomo, entered upon its eighth day in Clinton circuit court this morning with a threat on the part of the state that another grand jury investigation of the case may be made. Prosecuting Attorney Homer R. Miller of Howard county voiced the threat when it developed that debit and credit slips of the bank were missing. Efforts are being made to locate the slips, which Miller intimates will constitute "damaging" evidence that books of the bank were "juggled." Disclosure that the papers could not be found when Miss Daisy Ervington, secretary to Owens when he was head of the bank and later in the employ of the bank's receivers, was on the witness stand. She said they were placed in a vault but that a search she had made during the last two weeks gave no trace of them. It is expected the trial of Miller will continue for several days yet. Attorneys for both sides agree there is no possibility of the case being concluded this week.
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# KOKOMO BANK # CRASH ACCUSED # WINS ACQUITTAL Frank S. Owens Freed in Case Which Involved State Officials. By United Press FRANKFORT, Ind., Nov. 13.- Frank S. Owens, former president of the defunct American Trust Company, Kokomo, has been acquitted in Clinton circuit court here on charges of embezzlement. The charge against Owens was based on the alled taking of funds from depositors when he knew the bank was to be closed. Indictments against Luther Symons, state banking commissioner; Thomas D. Barr, deputy commissioner, and Ora Davies, former state treasurer, were quashed. They were indicted with Owens. The charge against Davies was quashed because the statute of limitations had run, and those against Symons and Barr, because it was held they were not liable for error in the performance of their duties. Indictments against William H. Arnold, a former president of the bank; his son, L. B. Arnold, and a brother, Tom Arnold, were retired. Authorities have failed in their attempts to extradite W. H. Arnold from Florida.
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# CASE AGAINST # DAVIES CLOSED Former State Treasurer Faced Bank Suit. By Times Special KOKOMO, Ind., Feb. 26.-Legal action against Ora J. Davies, former state treasurer of Indiana, in connection with failure of the American Trust Company Bank, is apparently at an end. Following sustaining of demurrers to a complaint against Davies by Judge Cleon W. Mount in Tipton circuit court, to which the case was taken on a change of venue, counsel for the bank's receivers stated no further action is likely. One paragraph of the complaint sought recovery from Davies of $6,500 paid him by the bank in consideration of his making it a depository for state funds. A second paragraph sought $4,894.15 alleged to have been paid after Davies left the state treasurer's office. Judge Mount intimated it might be possible to draw a complaint on the second paragraph which would stand, but that the second paragraph was inherently groundless, as the transaction referred to occur at a time when Davies was acting merely as an agent of the bank. A new development in the bank case is filing of a suit for $5,000 by the Farmers Trust and Savings Ban the Farmers Trust and Savings Bank of Kokomo against Frank S Owens, former American Trust president, on notes he signed as security.
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# FIVE CHARGES # END IN BANK # FAILURE CASE William H. Arnold Still Facing Like Number for Trial at Kokomo. By Times Special KOKOMO, Ind., Nov. 27.-William H. Arnold, originally accused in ten indictments in connection with failure of the American Trust Company bank here, will have only five of them to contend with, when he faces trial, attorneys announce after looking over the records of the case. After successfully resisting efforts to return him to Indiana from Florida for trial, covering nearly two years, Arnold returned here and surrendered. Three of the indictments now extinct accused Arnold and his son-in-law, Frank S. Owens, who followed him as president of the bank, with conspiracy to commit a felony. These were dismissed after Owens had been acquitted on a charge of bankers embezzlement. As the indictments named the two jointly, dismissal as to one ended the case for the other. In another indictment, now invalid, Arnold was accused with R. H. Leavitt and Lewis Kirtley of conspiring to commit a felony. This was dismissed June 21, 1928. The fifth indictment believed at an end, accused Arnold and his son, Glenwood, of a felony conspiracy. It is said the statute of limitations has run against it. Still remaining are four charges of borrowing money from the bank without consent of the board of directors, and an indictment for embezzlement and grand larceny. However, with the five charges out of the way, Arnold is likely to face a strong fight, as during the trial which resulted in Owens' acquittal, much blame was thrown on Arnold in connection with the bank's failure, and evidence which authorities hold will be damaging to him was taken and can be used when he faces the court. No date for trial has yet been set.
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ACCUSED MAY RETURN SOON Former Kokomo Banker Said to Be in III Health. By Times Special KoKoMo, May 11.-That William H. Arnold, now a resident of Palatka, Fla., defendant in criminal proceedings brought by Howard county authorities three and onehalf years ago, is contemplating an early visit to Kokomo, is a report current among acquaintances here. The report is that Arnold is broken in health and feels that if he could have a change of scene his condition might improve. The rumor has served a revive interest in the prosecution of Arnold for alleged criminal transactions while serving as president of the American Trust Company, local banking institution, defunct since September, 1927. The case against Arnold was taken to Cass county on a change of venue and has been at a standstill for more than a year.