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'REICHERT DEAL' O.K'D Continued from Page One banks were taken over by smaller State Bank. These consummated through the introduced Ford State Arthur defense counsel. replied that WilMr. president of the Nelson, had called him from Arbor Allan, that the that night Mr three Nelson drove in from Ann Arbor. Reichert immediately told us that he was much concerned about affairs the Ford State Bank, Wyandotte, runs commencing in banks that owned and controlled bankers were banks, and that in this instance stock was largely owned controlled by Louis Wojcik, known 'Wojcik's per cent banks, the said Feared Run Bank Mr. Fearnley said that Mr Reichert Allan that runs had been occurring on private banks. "Mr. Reichert realized that the bank, allowed along unthe management Wojcik, would run culties, and he asked immediately get in touch and could which us immediately the of Wojeik that institution, make such deal order that any contemplated run might be averted. The deal ultimately consummated and of and resigned the ber the bank when added. He started to explain that Wojcik also complebank building in Wyandotte, which was later taken over by the American State Bank, but this was stricken from record. Money Was Borrowed The money was borrowed from the American State Bank the wittestified, through the AmeriDetroit discussed similiar deals in regard Ulrich Savings it Bank the Citizens Savings Bank, Mt. and also the First National Bank East De troit. All these institutions under State Bank He said stock purchased the Grand Rapids Savings Bank, he was familiar with this connection with the acquisition of the Guaranty Bank Trust Judge Skillman the witness into the record the developments $175,000 funds of the American State Bank were used bolster up the stock of the bank. In the of the assets of the Co. in summer of 1930, the reserve contingency fund the American State Bank $1,170,000. Necessary to Invest Mr. Fearnley explained that necessary invest in the stocks of the American State to hold pending the deal whereby the Guaranty went out ing the He explained the jury that this deal involved the transfer stock, the holders securities the stock of the American State Bank "After the the American State Bank began to drop, the Guaranty selling Mr. Fearnley explained "When the stock bank begins to drop the public likely that all not well with the the danger of run becomes apparent. "Then you transferred from the State Bank funds the stock of that Judge Skillman Judge Enters Questioning "Yes, sir." the witness replied. "The money transferred to the Co. then started part stock that ket. later got the large former the Guaranty together, and made agree ment for to hold their stocks for months "And you disposing of this asked the judge. heavy depositors and personally sold some of this stock which had picked replied Mr. Fearnley believed sincerely this stock good investment Banks in Detroit had been merging heard words approval from rectors and our independent sincerely the stock the American was good "In what capacity were you advising depositors the State Bank invest the stock?' the judge my capacity as vice president of the Detroit Co,' the witness. "You that could not deal officer the bank, bank. That would be against the law, would not? Judge Skillman asked. The witness said it would Others Were Reluctant Mr. Fearnley testified that all which the participated were carried through either his own name, or in name Allan. Others reluctant to sume responsibility, he said, because the which banks that he and Mr. Allan busy the part 1929 their official tasks, that became necessary employ two sistants. only available. he William Nelson and Sherk, aminers for the Banking partment became president of the bank Sherk assistant vice president, Mr. Fearndefense read into the record resolution the board directors, which tribute paid the the bank year, for leadThis introduced by John Barlum and ported by Frank H. Dohany. unanimously adopted. Mr Fearnley positive his that all members board of directors familiar with the stocks other banks by the troit Co. This testimony given objection the when said that defense would prove
