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Broadway Bank Suspends. NEW YORK, April 14.—The Federal bank, a small institution in Broadway, closed its doors this morning. Its capital was $250,000.
Federal Bank (New York, NY)
Episode Information
- Episode Type
- Suspension → Closure
- Start Date
- April 14, 1904
- Location
- New York, New York (40.714, -74.006)
- Bank Type
- state
Metadata
Notes
Failure tied to alleged misappropriation by the bank president and insolvency; receivers appointed.
Events (3)
1.
April 14, 1904
Suspension
- Cause
- Bank Specific Adverse Info
- Cause Details
- Closed by state officials after insolvency linked to alleged misappropriation by president; owed depositors far more than assets.
- Newspaper Excerpt
- The Federal bank, a small institution in Broadway, closed its doors this morning.
- Source
- newspapers
2.
April 18, 1904
Other
- Newspaper Excerpt
- Charged with misappropriating $200,000 of the funds of the suspended Federal Bank, David Rothschild ... was arraigned before a magistrate and held in $25,000 bail for examination April 20.
- Source
- newspapers
3.
June 1, 1904
Receivership
- Newspaper Excerpt
- On application of Attorney General ... appointed Leo Schlesinger as temporary receiver of the Federal Bank. Mr. Schelscinger will deposit a bond of $350,000.
- Source
- newspapers
Newspaper Articles (22)
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New York Bank Suspends. New York, April 15.-The Federal bank. a state institution in this city, was closed during the day and officials of the state banking department are in charge. D. Rothschild is the president and its capital is $250,000. According to a recent statement the institution owed depositors $486,000.
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New York Bank Suspends. New York, April 15.-The Federal bank, a state institution in this city, was closed during the day and officials of the state banking department are in charge. D. Rothschild is the presIdent and its capital is $250,000. According to a recent statement the institution owed depositors $486,000.
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BANKER ROTHSCHILD SENT TO THE TOMBS NEW YORK. April 18.-Charged with misappropriating $200,000 of the funds of the suspended Federal Bank, David Rothschild, former president of the institution, to-day was arraigned before a magistrate and held in $25,000 bail for examination April 20. Rothschild was taken back to the Tombs to await ball.
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# Rothschild Is Held. New York, April 18.-Charged with misappropriating $200,000 of the funds of the suspended federal bank, David Rothschild, former president of the institution, was to-day arraigned before a magistrate and held in $25,000 bail for examination April 20. Rothschild was taken back to the Tombs to await bail.
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Bank President Arraigned. New York, April 19.-Charged with misappropriating $200,000 of the funds of the suspended Federal bank, David Rothschild, former president of the institution, Monday was arraigned before a magistrate and held in $25,000 bail for examination April 20. Rothschild was taken back to the Tombs to await bail.
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HELD FOR GRAND JURY. ROTHSCHILD'S METHODS. Muirhead Found-Clash Between Globe Receivers Over Papers. Strong intimations that more prominent men and women, including a well known bank president and a Standard Off man, as well as other banking institutions heretofore reputable. were involved in the dual collapse of the Federal Bank and Globe Security Company. were made yesterday. There was a persistent report that David Rothschild speculated and lost heavily in stocks. Rothschild was again arraigned and held for the grand jury at bail aggregating $25,000. A member of the firm of Meyer & Goldsmith, attorneys for the creditors in the bankruptcy proceedings, said last night that a writ of habeas corpus for Rothschild would he asked for this morning, that he might give evidence in the hearing before Commissioner Alexander. Detectives last night had found William Muirhead, the treasurer of the company, who is under $1,000 ball in the Globe usury case, and is also wanted as a witness in the bankruptcy hearing on Saturday. Miss Carrie Adams, of No. 206 West Seventieth-st., who has been seen frequently in the company of Louis Rothschild. a brother of the ex-president, was served with a subpeens ordering her to appear before United States Commissioner Alexander A subpoena has also been issued for Mrs. David Rothschild Receiver McKeen of the Globe Security Company, who was appointed by the Federal Court. learned that Charles C. Black, who had been appointed receiver for the company by the NewJersey Chancery Court. had further qualified as receiver under a New-Jersey federal court commission. the office of neither receiver taking precedence and both applications having been made simultaneously. To confound the confusion Deputy Sheriff John J. Plunkett. who was nominally in charge, refused to leave the office, declaring that he must first have his "poundage" and that there was sufficient money in the office to pay his fee a few hundred dollars. This Receiver McKeen declined to pay. "I find that the trustees." Mr. McKeen told a Tribune reporter. "have transferred the securities to New-Jersey. and I am told on good authority that papers belonging to this office have been taken to that State I have opened several of the safes and found them-empty." Mr. Meyer. of the creditors' counsel. declared that an order had been signed by Justice Holt compelling the trustees to return the papers to the Nassau-st. office. Henry L. Lowds, one of the trustees, has already been subprened by the marshal, and John H. Russell, another trustee, is being sought. Mr. McKeen said that at Saturday's hearing he hoped by the evidence of employees to obtain the keys and combinations of safes he was unable to open. An order is also being sought authorizing Mr. McKeen to continue the business of the company in the Interests of the creditors and sue for loans due, etc. In his application Mr. McKeen states that notes are daily becoming due and must go to protest failing authorization to continue business The fact that Cuthbert the expert accountant who went over the books of Sully & Co., has charge of the accountants who are going over the Globe Security books, was considered part confirmation of the report that Rothschild had lost most of the money in cotton speculation. The only cash asset of the company that was known to exist was $2,840 in the Guardian Trust Company. Just before or immediately after the deputy sheriff took possession of the offices on Saturday, Mr. Muirhead, it is said. went to the trust company and drew out the entire deposit. United States Marshal Henkel has sought for Muirhead in vain. "Compared with the Globe Security Company." said Samuel J. Goldsmith, "the Miller syndicate pales into insignificance." Richard W. Jones, Jr., president of the Oriental Bank, at Broadway and John-st., and expresident of the defunct Seventh National Bank, declared that his institution had asked the Federal to withdraw its accounts because of the many out of town checks that it had deposited and against which it drew immediately after depositing. "Our only dealing with the Federal," said Mr. Jones, "was the carrying of its account. The Federal never owed the Oriental a dollar," Mr. Jones admitted that he had had personal dealings with David Rothschild "Did you ever recommend or indorse Mr. Rothschild?" he was asked. "I don't remember that I ever did," said Mr. Jones. Assistant District Attorney Kresel declared positively that others besides Rothschild had benefited through the Federal Bank's operations. He declined to mention any names He said he had learned that when the bank was being organized it employed ex-Alderman Louis Minski to solicit business and sell stock. According to the agreement he was to get one-half of 1 per cent on the deposits, which netted him about $3,000 a year, and a large percentage on the sale of stock. He had good reason to think it was 25 per cent. The grand jury would be asked to indict Rothschild on several counts of grand larceny. Every time Rothschild discounted an accommodation note he was guilty of grand larceny. On March a statement was issued which represented that the bank was in good condition. If it is learned that this statement was not in accordance with the facts some action would probably be taken against Rothschild on that account, probably in the form of an indictment alleging perjury. Mr. Kresel aserted that he had been informed that Rothschild would plead guilty. Several persons who had borrowed money from the company and do not read the newson fourth page
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Misuse of Big Amount. New York.-Charged with misappropriating $200,000 of the funds of the suspended Federal Bank, David R. Rothschild, former president of the institution, today was arraigned before a magistrate and held in $25,000 bail for examination April 20. Rothschild was taken back to the Tombs to await bail.
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Held For Examination. - - New York, April 19.-Charged with misappropriating $200,000 of the funds of the suspended Federal bank, David Rothschild, former president of the institution, Monday was held in $25,000 ball for examination April 20.
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New York Bank Suspends. New York, April - -The Federal bank, a state institution in this city, was closed during the day and officials of the state banking department are in charge. D. Rothschild is the president and its capital is $250,000. According to a recent statement the institution owed depositors $486,000.
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# TELEGRAPHIC BREVITIES. It is believed in Tokio that the United States ultimately may offer to act as mediator between Russia and Japan. The efforts of Zoltan Doehme, Mme. Nordica's ex-husband, to set aside the divorce decree is said to involve two wealthy men. Emperor William has suddenly abandoned his proposed visit to Corfu. The anarchists at that place may have caused the change in plans. Typewriter girls in New York organized a union under the protection of the American Federation of Labor for more pay and shorter hours. A long freight train on the Lake Erie & Western road went through a bridge near Kokomo, Ind., and was totally wrecked. Engineer Cummins and Fireman McKinzie were badly injured. Senator Nelson, in the heat of an argument urging better roads for Alaska, astonished the senate and himself by using a swear word. He was so embarrassed that his speech ended at that point. Physicians attribute the death of Maj. Hugh C. Dennis, president of the Rialto Grain & Security company at St. Louis, to grief over the conviction of Senator Burton for his connection with the company. Charged with misappropriating $200,000 of the funds of the suspended Federal bank of New York, David Rothschild, former president of the institution, was held in $25,000 bail for examination April 20. Strenuous efforts by men high in church and state failed to obtain for President Loubet an audience with Pope Pius, the pontiff insisting that peace with the quirinal must come without outside intervention.
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FEDERAL BANK DEPOSITORS MEET. At a meeting of depositors of the Federal Bank last evening at No. 334 Grand-st., resolutions were passed that an appeal be made to Governor Odell on behalf of the poor East Side depositors to see that a "responsible and reputable receiver" be appointed. The depositors have to offer for the place the vice-president of the Jefferson Bank, at Canal and Forsyth sts., who will act without compensation, and promises to 00 his utmost to collect any assessments from the stockholders of the Federal Bank.
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IN TROUBLE. Receiver Appointed for Federal Bank at New York. New York, June 1.-On application of Attorney General Cunnen, Justice Greenbaum in the supreme court. today. appointed Leo Schelscinger as temporary receiver of the Federal Bank. Mr. Schelscinger will deposit a bond of $350,000. He is ordered to deposit all funds of the Federal Bank with the Mechanics' and Traders' Bank. According to a statement by Bank Examiner Judson filed on April 5, 1904, the assets of the Federal Bank were $346.775, and the liabilities $746,237, leaving a deficit of $339,462.
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# CALL FEDERAL SOLVENT. Counsel Think Bank Has More than Enough to Pay in Full. On the order to show cause why the temporary receiver for the Federal Bank should not be made permanent, Justice Geigerich heard argument yesterday. Affidavits were submitted from the president of the bank, William M. Woods, and from the cashier, Robert A. Doolittle. These affidavits say that while the bank examiner's report shows liabilities of $740,237.02, $250,000 of this is capital stock of the bank, so that the total liabilities to the creditors are $496,237.02. As against this the bank examiner finds good assets, $346,777.53, leaving a deficiency of $149,461.49, and Mr. Woods states that in his opinion there are over $156,431.67 in good assets which the bank examiner has classed as uncollectable, making a total of good assets amounting to $503,207.20, or $6,970.18 above all liabilities to creditors. Besides this amount, there is $253,043.44 which the examiner treats as uncollectable, but from which Mr. Woods believes a considerable amount may be realized. It would therefore appear, say counsel for the bank, that it has more than sufficient to pay its creditors in full and is solvent. Decision was reserved.
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# GLOBE SECURITY RECEIVER. Court Appoints One to Keep Its Assets in This State From Getting Out. Supreme Court Justice Greenbaum appointed Felix H. Levy yesterday receiver of the assets in this State of the Globe Security Company, the money lending shop, formerly at 150 Nassau street, in which David Rothschild, now a laborer in Sing Sing jail under a nine year sentence, used to turn the screws. The receiver is appointed on the application of Kneeland, La Febra & Glaze, counsel for Leo Schlesinger, receiver for the Federal Bank in Grand street, which Rothschild wrecked. In the transactions between the bank and the company, the bank held six notes aggregating $16,167 made by the company in February and March last year, and indorsed by D. & L. Rothschild. The bank discounted them. The company's assets are estimated at $5,000. Its last schedules showed liabilities, $968,800; nominal assets, $512,440. Gen. Kneeland said last night that the receiver is not for the corporation, but only for the assets in this State, and is appointed to prevent further attachments and to prevent the property going outside of the jurisdiction of the court.
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JUDGMENT AGAINST DAVID ROTHSCHILD Judgment for $218,757.06 was entered yesterday against David Rothschild, formerly president of the Federal Bank of New-York who is in Sing Sing. The judgment is In favor of Leo Schlesinger. as receiver of the Federal Bank, for money advanced by the bank to Rothschild in 1903 and 1904. It is on a report made by Henry W. Bookstaver, who was appointed referee on October 28. 1905, to take proof and ascertain the amount due the bank. Rothschild was served with the summons in the suit on September 15, 1905, when he was in the Tombs,
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RECEIVER SUING MISS PAGE. Woman Who Caused "Count" Sacky's Arrest Said to Owe Federal Bank 84,125. A petition in bankruptoy was filed yeaterday against Miss Clara E. Page of 244 West Fifty-sixth street, who recently had "Count" Aribert Sacky arrested on a charge of swindling her. Kneeland, La Fetra & Glaze, attorneys for Leo Schlessinger. receiver for the Federal Bank, are suing her for $4,125, balance due on a demand note which she made on January 25, 1904. The note was partially secured by a chattel mortgage on household furniture, which it is alleged, she has concealed. It is alleged that since April 1, while insolvent. she has transferred a portion of her property to several creditors and has concealed and removed part of her property. H. M. Stevenson was appointed rereiver in supplementary proceedings in the City Court.
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in possession of the creditor, together with notes: Harry Katcheim, No. 194 Duane street, amount of debt unknown; similarly secured: the notes given by the Charles F. Lucas Company; the Eastern Refrigerator Company, Jersey City: amount of claim, unknown, and similarly secured; Dora Corte, Bloomfield, N. J., $1,000 for money loaned to Charles F. Lucas Company, unsecured. The assets consist of stock in Charles F. Lucas Company. of par value of $11,000; life insurance policy, $5,000; wearing apparel, $150. An involuntary petition was filed against the S. W. Levey Company, No. 200 Broadway, by three creditors, with claims as follows: L. Folk's Sons, $215; John B. Ellison, $1,000; Bauer & Heineman, $600. The petitioner's creditors allege preferential payments as an act constituting bankruptcy, and that its officers and stockholders were permitted to withdraw sums of money illegally for the purpose of "hindering, delaying the creditors and concealing the money from legitimate creditors." Charles W. H. Jackson was appointed receiver of the business of the S. W. Levey Company, with a bond of $1,500. The receiver is authorized to continue the business of merchant tailoring until June 30, making up such orders as are now on hand. It is further claimed that the president of the S. W. Levey Company is at present ill at his home, and will remain so for an indefinite period. The other two officers of the corporation, brothers of the president, not only claim they are in no way actively connected with the business, but also disclaim any official relationship therewith, or knowledge of the fact that they are officers of the company. McDougall Hawkes was appointed receiver of the business of J. S. Brandt & Co., involuntary bankrupts, with a bond of $7,500. The liabilities of the alleged bankrupt are estimated at $47,000. with assets of about $15,000. A voluntary petition was filed against Daniel J. McCauley, No. 242 East 12th street, liquor dealer, showing liabilities of $16,261 and assets of $50. The principal creditors are the German Exchange Bank, Bowery and Bond street, $2.279: Leo Schlessinger. receiver of the Federal Bank of New York, $2,250; Adolph M. Bendheim, No. 128 Broadway, $1,711; the Eichenwald & McCauley Company, No. 3d street, $1,123; Edward P. Hayes, No. 400 East 59th street, $2,000: George Eichenwald, No. 323 East 10th street. $1,000, and two additional claims of an unknown amount. The assets consist of wearing apparel, valued at $50, and 464 shares of stock in the D. J. McCauley Company. which petitioner declares to be not only worthless, but already hypothecated to secure a creditor. The stock in question is said to have no market valuation.
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JUDGMENT FILED. Depositors and Creditors of Bank to Get Benefit. New York, July 21.-A judgment of $1,250,000 against the stockholders or the failed federal bank and in favor of the depositors and other creditors of the bank was filed in the county clerk's office today by Leo Schlesinger, receiver of the bank This sum represents the bank's total capitalization. The deficiency in the assets was $300,000 but the receiver declared that this would be fully made up, by collections made on doubtful assets and that the claims of the creditors will be paid in full.
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TO ASSESS STOCKHOLDERS FOR LOSSES OF BANK NEW YORK, July 23.-An omnibus judgment was entered in the county clerk's office on Saturday by attorneys for Leo Schlesinger, receiver of the Federal Bank, against 101 stockholders in the bank for their liability up to 100 per cent as stockholders. The total amount is $250,000 and $6,432 costs. Among them are David and Louis R. Rothschild, $85,000; Henry Fraser, William M. Woods and Robert A. Doolittle, $63,300; Lewis Haase, $10,000; Hyman Stoff, $5,000; Lizzie Carraway Nash, $5.000: Henry M. Goldfogle, $1,500, and James E. March, $500.
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-MURPHY JUDGES, INC. A FEW CORPORATION LAWYERS ON "CLEAN BENCH" TICKET. M. Warley Platzek, Counsel for Beer Trust Firm, Which Hearst Papers Attacked -Erlanger for Theatrical Combine -Was a Friend of David Rothschild. Mr. Hearst and his newspapers have repeatedly referred to the judiciary ticket put by the Nominators as "a tioket made up entirely of corporation attorneys." He professes to favor a clean, upright bench entirely free from corporation control, but hehas remained silent about the charges brought in this line against some of the candidates running on the ticket which was the result of a bargain between himself and Charles F. Murphy. M. Warley Platzek, who was put on the ticket for Supreme Court Justice by order of Murphy, long has been engaged in defending corporations and he is himself the and director one at the president least, Fidelity Coal in and corporation Iron Comof Tennessee. He was active as counpany Govsel in the criminal proceedings of the ernment against the beef trust in Chicago and was connected in a legal way with the case of the Schwarzschild & Sulzberger Company. which finally entered a plea of guilty, upon which four of its officers were fined $25,000 by Judge Humphrey on Sentember 21 of last year. Mr. Hearst's newspapers have time and again scored the beef trust for its methods of doing business. Mr. Platzek also is said to be counsel for the United Cigar Stores, about whose business methods so many retail tobacco dealers complain. Another corporation lawyer on the Murphy-Hearst ticket is Mitchell L. Erlanger. He is a brother of the theatrical manager and is attorney for the theatrical trust, the Klaw & Erlanger Building and Construction Company and the New York Theatre Company. It was the theatrical trust that barred James Metcalfe, the dramatic critic, from its theatres. Erlanger was a friend of David Rothschild, who wrecked the Federal Bank and the Globe Security Company, in which many people on the East Side lost the savings of their lives. Erlanger was a depositor there personally and he also deposited in the bank some of the funds that he held as Sheriff. But he got the money out before the crash came. When Erlanger was running for Sheriff Rothschild sent out hundreds of personal letters begging his friends to help the Tammany candidate. These letters read: 'As my friend Mitchell L. Erlanger has been nominated by the Democratic party for Sheriff of the county of New York, and as I am greatly interested in the success of his candidacy as well as the success of the entire Democratic ticket, [should esteem it a personal favor if you would contribute something toward the expense of the campaign. "Please draw your check to the order of James W. Gerard, chairman finance com- will mittee, and mail the same to me and I personally attend to its delivery. "DAVID ROTHSCHILD." Erlanger has since denied that he was friend of Rothschild or that he ever got a a cent of campaign money from him. Another candidate on the Murphy-Hearst ticket who had close corporation connections is J. J. Brady. whose nomination was made as a favor to Louis F. Haffen, the Tammany boss of The Bronx. Brady, it is said, has had a finger in every real estate pie that has been cut in The Bronx in the He last ten years and be is now a rich man. is a director and an active worker in the Geiszler-Haa Realty Company. which has put through some big deals recently. He is also interested largely as a stockholder and director in the Sound Realty Company, the Manhattan Mortgage Company and the Bronx Borough Bank Charles L. Guy, another candidate on the Murphy Hearst ticket. is also a corporation man, being director in the Washington Heights Realty Company. And even John the Ford, one of the men who were put on adticket through the demand of Hearst, mitted yesterday that he was a corporation lawyer, too, being counsel for the Queen Accident and Guarantee Corporation of London, which does an accident, burglary and credit insurance business all over the world. He said he was sorry that he did not have more corporations to represent and that he would not draw the line at even the sugar trust. He hastened to add that he was no friend of the predatory corporations such the Ryan-Belmont merger, the beef as trust and the gas combine but said that he believed that corporations when properly conducted were good things.
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ATTORNEY HOPES TO RECOVER $422,000 ST. LOUIS, Nov. 16.-"I have every confidence that my visit to St. Louis will result not only in the recovery of the $422,000 which Mrs. Eugene Batten has told of, but that it will lead to the ultimate finding of $1,000,000 of the funds of the institution, which her former husband, David Rotnschild, dominated and wrecked." This statement was made last night by George W. Glaze, attorney for the receiver of the defunct Federal Bank, of New York, which Rothschild looted. Mr. Glaze visited Mrs. Batten last night, but found her in the care of a nurse and too ill to enter into a discussion of the affair.