Union Bank (New York, NY)

Episode Information

Episode UID
7709308891285
Episode Type
Suspension β†’ Closure
Bank Type
state
Bank ID
770930889 hash
Start Date
January 30, 1907
Location
New York, New York (40.714, -74.006)

Metadata

Model
gpt-5-mini (chosen from majority vote of a three-model LLM ensemble)
Short Digest
0098f2654226d4ac

Response Measures

None

Description

Originally reopened in 1908 from Mechanics & Traders' Bank; closed by State superintendent and placed in liquidation in Apr 1910.

Events (4)
1. January 30, 1907 Other
Newspaper Excerpt
the Mechanics and Traders' Bank, which suspended on January 30 last as a result of the panic, tying up over $10,000,000 of deposits
Source
newspapers
2. August 17, 1908 Reopening
Newspaper Excerpt
was reopened yesterday as the Union Bank of Brooklyn. The main office ... was thronged all through banking hours by depositors who wished to deposit money, and there were few withdrawals.
Source
newspapers
3. April 5, 1910 Suspension
Cause
Government Action
Cause Details
State superintendent of banks took possession after examination found bank in unsafe condition and inability to realize assets to meet demands.
Newspaper Excerpt
The Union Bank of Brooklyn closed its doors today and was taken in charge by the State banking department.
Source
newspapers
4. April 6, 1910 Receivership
Newspaper Excerpt
Announcement was made of the failure of the Union Bank, of Brooklyn, with deposits aggregating over $5,000,000. The decision to place the Union bank of Brooklyn in liquidation
Source
newspapers

Newspaper Articles (24)
1. February 12, 1908 The Evening World New York, NY
Article from The Evening World, February 12, 1908

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Department Wants to Know. The passing of the presidency of the Mechanics and Traders" Bank from Mr. Moyer to Mr. Sullivan gave the Union Bank its desired New York Clearing-House connection, and since then other branches, have been opened and a thriving banking business carried on up to the suspension of the institution a tow days ago, In getting his Union Bank into general banking circles by acquiring the New York Clearing-House connection afforded by the merger with the Mechanics and Traders' Bank Mr. Sullivan is said to have paid the bonus of $125,000. The right of the recipients of this bonus to accept it. knowing that it came out of the funds of a branch of the institution which they still continued to direct is the problem now before the Department of Banking.

2. August 12, 1908 New-York Tribune New York, NY
Article from New-York Tribune, August 12, 1908

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NEW BANK INQUIRY HELPS CLARK WILLIAMS. Kings District Attorney's Office Probing Pre-Panic Troubles. At the suggestion of Clark Williams, State Banking Superintendent, the District Attorney's office of Kings County within the last few days has been making an investigation into the conditions which led up to the recent financial troubles in the Mechanics and Traders' Bank. The institution temporarily closed up while David A. Sullivan was president, five months ago. It is now back on its feet, and on Monday it will reopen as a strictly Brooklyn concern under the presidency of ex-Controller Edward M. Grout. It will be known henceforth as the Union Bank. Mr. Williams, it is understood, did not ask the co-operation of the District Attorney earlier, as the bank was being reorganized and the announcement of an investigation at that time would perhaps have been injurious to the concern. Now it is again on the highway to health. Assistant District Attorney Francis X. McCaffry has been placed in charge of the investigation. and has examined several witnesses as to the transactions that preceded the closing of the bank. What he has learned he will lay before the next grand jury, which will have its first session on August 25. It is said that he has discovered several forgeries that will involve important persons in banking circles. When asked last night to tell what he had been requested to do by Mr. Williams and what he had 80 far discovered, Mr. McCaffry said: "Mr. Williams asked the District Attorney's office to investigate the conditions that led up to the suspension of the bank. The investigation was not directed against any particular person. It does not affect the bank 2S it is now organized in any way. There is no reason for any one interested in the Union Bank to be alarmed by the investigation into the affairs of the Mechanics and Traders Bank Mr. Williams discovered certain transactions which he thought should be looked into by the District Attorney's office of this county." Mr. McCaffry said he had the power of tracing into New York County or any other county of the state any transaction which had begun in Kings County, but he spoke as though he had not found It necessary to cross the river.

3. August 18, 1908 New-York Tribune New York, NY
Article from New-York Tribune, August 18, 1908

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UNION BANK OPENS Old Mechanics and Traders' Now a Brooklyn Institution Solely. The Mechanics and Traders' Bank. which suspended on January 30 last as a result of the panic, tying up over $10,000,000 of deposits, was reopened yesterday as the Union Bank of Brooklyn. The main office. at No. 44 Court street, Brooklyn, was thronged all through banking hours by depositors who wished to deposit money, and there were few withdrawals. Edward M. Grout who succeeded David A. Sullivan as president, said that the day's deposits were over two and one-half times the amount of the withdrawals. Mr. Grout was well pleased with the opening day's business, both at the main office and at the seven branches, all of which are in Brooklyn. He said that he had received the promise of the hearty support of a large number of influential Brooklyn business men. The bank starts business with a capital of $1,000,000 and a surplus of over $800,000. When the Mechanics and Traders' Bank closed its doors its main office was at Broadway and Prince street, Manhattan, and it had two branches in this borough and eight in Brooklyn. Prior to the panic it had total deposits of over $24,000,000. but the heavy withdrawals of the panic period reduced the deposits by over one-half. The bank was a consolidation of the old Union Bank of Brooklyn and the Mechanics and Traders' Bank of this borough. Through the latter bank it had a membership in the New York Clearing House Association. The capital was increased to $2,000,000 at the time of the merger The depositors in the old Union Bank of Brooklyn did not like the idea of having the headquarters removed to Manhattan, and many left the bank After the suspension it was decided that the best thing to do would be to quit the Manhattan field altogether. and to this end the capital was reduced to $1,000,000. The mair. office at Broadway and Prince street was given up and the headquarters of the reorganized bank was transferred back to No. 44 Court street, Brooklyn, which was the old home of the Union Bank of Brooklyn before the merger. The old name was also restored. The branches at Times Square and Madison avenue and 59th street, this borough, were discontinued. as was one of the Brooklyn branches Manhattan depositors of the Mechance and Traders' Bank will not. however, be inconvenienced by the dropping of the Manhattan end of the bank's business. They will be paid off at the old main office and at the Times Square and Madison avenue branches, just as if the new bank were actually operating in this borough The plan under which the bank was reopened provides that depositors may withdraw 10 per cent on resumption of business, 15 per cent in four months, 20 per cent in eight months, 25 per cent in twelve months and the remaining 30 per cent in sixteen months. Prestdent Grout expects to be able to anticipate a number of these payments. The bank will now be conducted purely as a Brooklyn institution with no connections outside the borough. It is not a member of the Clearing House, the membership having been the property of the old Mechanics and Traders' Bank, and having been forfeited at the time the bank suspended. There has been an entire change of control and management. A majority of the stock is in the hands of three voting trustees-Morgan J. Brien, Mr. Grout and William H. English, vice-president of the Empire Trust Company. The new board of directors consists of Henry Albers, William F. Corwith, Barth S. Cronin, C. E. Donnellon, William H. English, E. A. Fitter, Jacob L Greatsinger, Edward M. Grout. Paul Grout, S. J. Harding, Samuel M. Jarvis, Nathaniel H. Levi, William H. Lynn. Thomas J. O'Donohue, Henry Ollesheimer, Edwin J. Stalker, James W. Stevenson, John R. Stine, William Strasser and Dr. Frank E. Wilson.

4. August 23, 1908 New-York Tribune New York, NY
Article from New-York Tribune, August 23, 1908

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BRYAN BEGINS SPEECHMAKING. "Mr. Bryan started on a seven days' trip, and began his speechmaking at Des Moines, Iowa. He attended a council of the state leaders in the afternoon and spoke on the tariff in the evening. After a three days' conference with his campaign managers in Chicago he will speak on the trusts in Indianapolis and on financial legislation in Topeka, Kan. His tariff speech was an attack on protection and an argument for a tariff for revenue only. He also advocated an income tax. "James Schoolcraft Sherman, the Republican Vice-Presidential candidate, received official notification of his nomination at his home in Utica. In his speech of acceptance he said that the overshadowing issue of the campaign was 'Shall the policies of President Roosevelt be continued?' not 'Shall the people rule?' Mr. Bryan's issue, because the people did rule. "Governor Johnson of Minnesota was renominated by the Democrats, and despite his reiterated statement that he would not run he accepted the nomInation. "The Appellate Division of the New York State Supreme Court decided as constitutional the legislative reapportionment act of 1907. The racetrack gamblers had counted in event of a contrary decision on unseating Senator Wallace, the loss of whose vote would have made a tie vote on the racetrack gambling bills." "Any more returning prosperity harbingers?" "The Mechanics and Traders' Bank, which suspended in Manhattan on January 30, reopened as the Union Bank of Brooklyn, with Edward M. Grout as president. The Commercial National Bank of Chicago made a study of commercial, financial and farm conditions and found that the conditions in all three show that a return to normal business times is under way. Another sign of returning prosperity was given by the New York Custom House receipts of Tuesday. They were $300,000, the largest of any day since the financial flurry."

5. April 5, 1910 Newark Evening Star and Newark Advertiser Newark, NJ
Article from Newark Evening Star and Newark Advertiser, April 5, 1910

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BROOKLYN BANK, WITH $5,000,000 DEPOSITS, CLOSES Former Comptroller Grout, of New York City, President of Institution. NEW YORK, April 5.-The Union Bank of Brooklyn, a State institution with seven branches in various parts of Brooklyn borough, closed its doors today and was taken in charge by the State banking department. Edward M. Grout, former comptroller of New York city, is president of the institution, which has a capital of $1,000,000 and deposits, according to its last report, of more than $6,000,000. Inability to realize upon assets in time to meet the demands of the bank's business is assigned by President Grout as the reason for the closing. The bank was organized in 1908 and took over the business of the Mechanics and Traders' Bank, which closed during the 1907 financial panic. Causes which ante-date the present management and were beyond its control made it impossible to reestablish the bank, President Grout declared in a statement today. He added his belief that the assets were ample to pay depositors in full. It is not believed that the closing of the Union Bank will adversely affect any other financial institution. Its difficulties were internal and related to its affairs alone, it is officially declared. Superintendent Cheney has issued the following statement in regard to the closing of the bank: "As a result of an examination of the Union Bank of Brooklyn by the banking department a meeting of its directors was held Monday evening at the office of this department to consider whether the bank was not in an unsafe condition because of certain of its assets for the character of which the present management is not responsible. "After deliberation the board reached the conclusion that the bank should not continue its business. The board. accordingly requested the superintendent to take possession. Pursuant to that request and provisions of the banking law the superintendent has taken possession of the corporation." The Union Bank of Brooklyn was organized in 1908 and, according to its last official report, has a surplus of $669,300. deposits of $6,255,000, loans and discounts of $5,328,700 and cash holdings of $529,800. President Grant made the following statement: "The officers and directors of the Union Bank regret that they have found it impossible to reestablish the bank. They have spared no efforts to that end and believe that causes of their failure were beyond their control and antedated the period of the management. These causes, I ought to add. relate to this institution alone, and the closing of the Union Bank ought not to affect any other banks in any manner. "The trouble with us has been that assets are such that we have been unable to realize upon them in time to meet the demands of the business of the bank. I refer to the large amount of real estate, and the various claims whose payment is unavoidably deferred. These were all inherited by the present officers of the bank. The shortage of cash and a lot of assets expresses the situation briefly. "I have no doubt of the full payment of every deposit, as the assets are more than enough for that purpose."

6. April 6, 1910 The Washington Herald Washington, DC
Article from The Washington Herald, April 6, 1910

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New York, April 5.-Financial news today was not exceptionally notable, nor altogether favorable, but such as it was it was helpful to what Wall street speculators love to call "the constructive" side of the stock market. Announcement was made of the failure of the Union Bank, of Brooklyn, with deposits aggregating over $5,000,000. Five million dollars more gold was engaged for export, and the indications were that at least an equal sum might be further taken before the end of the week. Decided weakness again developed in various copper mining shares in the Boston market of the same general sort as that which has been exhibited in other directions for more than a fortnight past. On the other hand, the Brooklyn bank suspension was rightly regarded as being no more than an unavoidable result of the 1907 financial troubles, and one that has for a long time been considered inevitable in banking circles. It is believed that depositors will not experience any losses from the affair, and that the worst thing that will happen to them will be that their money will be tied up for a little while. Reduction for Time Money. Gold exports, present and prospective, were naturally regarded as being more or less of academic character, in view of an actual reduction to-day in rates for the use of time money and a distinctly easier tendency in call funds. Time money was quoted lower to-day than it has been at any time for several weeks, and the bulk of call money put out was below 3 per cent. The decline in copper stocks in Boston was looked upon as a marking down of values in many securities there that have hitherto been quoted altogether too high and for which there has been at no time recently other than a poor market. Interest in these stocks has been confined to a very few people, and has extended in only infinitesimal degree to the local financial community. Of all the occurrences of the day belonging to the usual class of stock market factors doubtless the one that excited speculative optimism more than anything else was an extreme break of fifty points in the price of some of the leading cotton options, due to the fact that last night and this morning there were heavy rains, snowstorms, and a general decided fall of moisture in the Southwest and in parts of Texas where drought conditions have lately been more severe than anywhere else in the country. As the wet weather extended considerably farther north, a good-sized break was also induced in the price of wheat. It goes without saying that anything that serves to increase the probability of large crops in the coming season is just now of the higest importance to the financial community. Later on to-day a partial recovery was made from the fall in cotton prices, but it is clear that indications for a big cotton crop, and, for that matter, for a large additions to the wheat crop, are much stronger now than they were a few days since.

7. April 6, 1910 The San Francisco Call San Francisco, CA
Article from The San Francisco Call, April 6, 1910

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STOCK TRADERS REVIVE MARKET NEW YORK, April 5.-The relative activity in the first and last hours of today's stock market rescued it from what would otherwise have been the dullest day of the present year and converted the closing into decided animation. The orders whose execution shaped that episode came apparently from professional sources. The discussion in stock market circles showed a shift of opinion as to the likelihood of a prompt decision by the supreme court in the important cases involving the anti-trust question. Yesterday's expectation of immediate action was changed to growing resignation to a probable delay until the end of the present term of the court or even until the end of the fall term, to afford time for the assimilation of the American tobacco and Standard oil cases into one decision. The dimensions which the gold export movement is assuming were regarded as an effect rather than a cause of the stagnant speculation. The London money market was engaged today with the redemption of the $105,000,000 war loan. which was expected to mark the period of the most pressing government requirements. The continued urgent demand for our gold is attributed to preparation for the next stock market settlement in London. The decision to place the Union bank of Brooklyn in liquidation made an unpleasant impression, although no other institution is supposed to be directly involved in the affair. The incident is an aftermath of the panic of 1907 and is due to the inadequate measure of reorganization. The example of the Union bank carries suggestion that there are many corrections yet to be accomplished of the conditions holding over from that period. United States steel was a prominent figure in the day's market movement. The estimates of the corporation's earnings for the first quarter of the year had an influence on the stock and were made the basis for predictions of an increase in the dividend rate at the directors' meeting on the last Tuesday in the month. Rains in the winter wheat belt were a favorable influence on stocks, although the closing of the most important wheat markets on account of local election holidays left the effects in that market somewhat obscure. A break in cotton was considered with attentive interest in the financial district. The belief is widespread that important speculative liquidation in the commodities markets is a probable event of the not distant future. Bonds were irregular: total sales, par value, $2,107,000. United States 3s, registered, advanced 1/4 per cent on call.

8. April 6, 1910 The Pensacola Journal Pensacola, FL
Article from The Pensacola Journal, April 6, 1910

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BROOKLYNI BANK IS CLOSED DOWN STATE SUPT. OF BANKS TAKES OF UNION CHARGE BANK, WHICH HAS CAPITAL STOCK OF $1,000,000. By Associated Press. New York, April 5.-The doors of the Union Bank of Brooklyn were closed this morning. The institution has seven branches. O. H. Cheney, state superintendent of banks, has taken possession of the bank. The president of the bank is Edward M. Grout, former comptroller of the currency of New York. The bank has a capitalization of $1,000,000, with deposits of $6,500,000. The bank was organized in 1908 and took over the business of the Mechanics and Traders Bank, which closed during the 1907 financial panic. President Grout said he believed the assets were ample to pay depositors in full. It is not believed that the closing of the Union Bank will adversely affect any other financial institution.

9. April 6, 1910 Omaha Daily Bee Omaha, NE
Article from Omaha Daily Bee, April 6, 1910

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NEW YORK STOCKS AND BONDS Market Opens Lively, Then Becomes Dull, Closes Active. STEEL A PROMINENT FIGURE Estimate of Corporation's Earnings show Influence and Predictions Point to Increase in Dividend Rate at End of Month. NEW YORK, April The relative activity in the first and last hours of today's stock market rescued it from what would been otherwise the dullest day of the present year and converted the closing into decided animation. The orders whose execution shaped that episode came, apparently, from professional sources. the discussion in stock market circles showed a shift of opinion as to the likely promptitude of a decision by the supreme court in the important cases involving the anti-trust.law Yesterday 8 anticipation of immediate action was changed to growing resignation to a probable delay until the end of the resent term of the court or even until the end of the fall term to afford time for the assimilation of the American Tobacco and Standard Oil cases into one decision. The dimensions which the gold export movement is assuming was regarded as an effect rather than a cause, of the stagnant speculation. The London money market was engaged today with the redemption of the $105,000,000 war loan, which was expected to mark the period of the most pressing government requiraments. The continued urgent demand for our gold is attributed to preparation for the next stock market settlement in London. The decision to place the Union bank of Brooklyn in liquidation made an unpleasant impression, although no other institution is supposed to be directly involved in the affair. The incident is an aftermath of the panic of 1907 and is due to the inadequate measure of reorganization. The example of the Union bank carries a suggestion that there may be corrections yet to be accomplished of the conditions nolding over from that period. United States Steel was a prominent figure in the day's market movement. The estimates of the corporations earnings for the first quarter of the year had an influence on the stock and were made the basis for predictions loft an increase in the dividend rate at the directors' meeting on the last Tuesday in the month. Rains in the winter wheat belt were a favorable influence on stocks, although the closing of some of the most important wheat markets on account of local election holidays left the effect in that market somewhat obscure. A break in cotton was considered with attentive interest in the financial district. The belief is widespread that important speculative liquidation in the commodities markets is a probable event of the not distant future. Bonds were irregular. Total sales, par value, $2,107,000. United States 3s registered advanced 1/4 per cent on call Number of sales and principal quotations on stocks were as follows: Hish Lem

10. April 6, 1910 New-York Tribune New York, NY
Article from New-York Tribune, April 6, 1910

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THE NEWS THIS MORNING. CONGRESS.-Senate: Mr. Heyburn consumed most of the session in discussing the administration interstate commerce bill. House: The naval appropriation bill remained under consideration. FOREIGN.-Mr. Roosevelt's refusal to meet the Pope and his decision to canwell the reception arranged for the Americans in Rome, owing to the Rev. Mr. Tipple's statement after his meeting with the ex-President, have caused a great stir in both Italy and in European capitals The House of Commons carried by a good majority Premier Asquith's proposal to limit the discussion of the veto resolutions regarding the House of Lords The Socialist Federation of Trades Unions in Germany, which has three hundred thousand members. has rejected the proposals of the Master Builders' Union, and a great strike seems imminent Nine persons were killed and twenty were injured in a panie among a crowd leaving the bullring at Zacatecas. Mexico. Mount Etna's activity increased and a stream of lava menaces the village of Cisterna Regina. The transandine railway tunnel, linking the republics of Chili and Argentina, was formally opened. Raw rubber reached a record price of 12s 4d a pound in London. DOMESTIC.-The Indiana State Republican Convention adopted a platform making no mention of the Payne-Aldrich tariff law: the Roosevelt policies and the administration of President Taft were indorsed. Emil Seidel, Social Democratic candidate. was elected Mayor of Mlwaukee. The Hinman-Green bill for direct primaries was strongly supported in a hearing at Albany. It was learned at Albany that the Finance Committee of the Senate had in process of formation a measure providing for a general investigation of legislative corruption. Bertram G. Spencer, a clerk. was accused of the murder of Miss Martha B. Blackstone at Springfield, Mass. It was estimated that about four thousand workmen were idle in New England on account of strikes in various places Several business blocks were destroyed by fire in Holland, N. Y. CITY.-Stocks were strong on light trading Two taxicab concerns were virtually merged, in preparation for greater combination. Andrew Carnegie returned to town, weak and ill A after his Western journey. woman was held up by a highwayman at midday in The Bronx and robbed, the alleged thief being caught after an exciting chase The Union Bank of Brooklyn closed its doors on account of Impaired capital, caused by slow assets and old had loans. Delegates from many colleges attended the convention of the Intercollegiate Civie League. George J. Gould testified in the government suit to dissolve the Union Pacific merger. Further advances in meat prices caused a riot on the East Side, where several kosher butcher shops were attacked. THE WEATHER.-Indications for today: Showers. The temperature yesterday: Highest, 77 degrees: lowest. 51.

11. April 6, 1910 The Evening Statesman Walla Walla, WA
Article from The Evening Statesman, April 6, 1910

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Activity in Final Hour Marks Trade NEW YORK, Aprol 5.-The relative activity in the first and last hours of today's stock market rescued it from what would otherwise have been the dullest day of the present year and converted the closing into decided animation. The orders whose execution shaped that episode came apparently from professional sources. The discussion in stock market circles showed a shift of opinion as to the likely promptitude of a decision by the supreme court in the important cases involving the anti-trust question. Yesterday's anticipation of immediate action was changed to growing resignation to a probable delay until the end of the present term of the court or even until the end of the fall term, to afford time for the assimilation of the American Tobacco and Standard Oil cases into one decision. The dimensions which the gold export movement is assuming was regarded as an effect rather than a cause, of the stagnant speculation. The London money market was engaged today with the redemption of the $105,000,000 war loan, which was expected to mark the period of the most pressing government requirements. The continued urgent demand for our gold is attributed to preparation for the next stock market settlement in London. The decision to place the Union bank of Brooklyn in liquidation made an unpleasant impression, although no other institution is supposed to be directly involved in the affair. The incident is an aftermath of the panic of 1907 and is due to the inadequate measure of reorganization. The example of the Union bank carries a suggestion that there may be corrections yet to be accomplished of the conditions holding over from that period. United States steel was a prominent figure in the day's market movement. The estimates of the corporations earnings for 0.00 first quarter of the year had an rence on the stock and were made the Lasis for predictions of an increase in the dividend ratΓ© at the directors meeting on the last Tuesday in the month Rain in the winter wheat belt was d favorable influence on stocks. although the closing of the most important wheat markets on account of local election holidays left the effects in that market somewhat obscure. A break in cotton was considered with attentive interest in the financial district. The belief is widespread that important speculative liquidation in the commodities markets is a probable event of the not distant future. Bonds were irregular. Total sales par value, $2,107,000. United States 3s registered advanced 1-4 per cent 0 neall.

12. April 7, 1910 The Richmond Palladium and Sun-Telegram Richmond, IN
Article from The Richmond Palladium and Sun-Telegram, April 7, 1910

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The Borough Bank of Brooklyn Is Ordered to Close by Superintendent. CAN PROBABLY PAY IN FULL THE PERSISTENT RUN ON THE INSTITUTION WAS CAUSED BY THE CLOSING OF UNION BANK MONDAY. (American News Service) Brooklyn, N. Y., April 7.-The borough bank with deposits of approximately four million dollars, was suspended today on an order of the state superintendent of banks. A quiet, but persistent run on the bank was caused by the closing of the Union Bank of Brooklyn Monday and resulted in an exhaustion of the Borough bank's available funds. The bank has much suburban real estate and may eventually pay dollar for dollar. The closing of the Borough bank follows that of the Union bank, which suspended business two days ago. The president of the Borough bank, is B.K. Shears. The excitement that followed the notices of closing was allayed when Superintendent Cheney issued the following statement: "The meeting of the board of directors for the Borough bank of Brooklyn was held at the office of the banking department, 52 Broadway at 6:30 o'clock, the meeting having been called by President Shears. After a conference with the superintendent of banks regarding the unusual demand being made upon the institution at its Eighth Ward branch and considering the character and the assets for which the present management is not responsible, the board decided to request the superintendent to toke pessession and thus conserve the best interests of all `depositors. "Pursuant to the request are the provisions of the banking law and. the superintendent has taken possession of the property and business of the corporation. No further statement regarding the condition of the bank will be made until the inventories have been completed. "There has been no withdrawal of deposits from any other institution."

13. April 8, 1910 Watertown Leader Watertown, WI
Article from Watertown Leader, April 8, 1910

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ANOTHER BANK CLOSES BOROUGH OF BROOKLYN IN CHARGE OF STATE OFFICIAL. Liabilities Carried from Panic of 1907 Are Too Heavy for the Present Management. NEW YORK, April 7.-The Borough bank of Brooklyn closed its doors today and the superintendent of banks has taken possession of the institution. The bank has a capital of $200,000 with deposits aggregating $2,000,000. E. R. Shears is president. This is the second bank failure in Brooklyn within a week, the first being the Union Bank of Brookyn. At the office of the state superintendent of banks, the following statement was given out today: "A meeting of the board of directors of the Borough bank of Brooklyn was held at the office of the banking department, 52 Broadway, at 6:30 o'clock Wednesday night, the meeting having been called by President Shears. "After a conference with the superintendent of banks regarding the unusual demands being made upon the institution at its Eighth Ward branch and considering the character of the assets, for which the present management is not responsible, the board decided to request the superintendent to take possession and thus preserve the best interests of all depositors. "Pursuant to the request and the provisions of the banking law, the superin:endent has taken possession of the property and business of the corporation. No further statement regarding the condition of the bank will be made until the inventories have been completed. There has been no withdrawal of deposits from any other institution.' Supt. Cheney said that the conditions attending the closing of the bank were almost identical with those which led to the closing of the Union bank. As was the case with the latter, the Borough was obliged to suspend during the panie of 1907, and was reorganized after the panic was over. The new management was obliged to assume liabilities which have been a heavy load. Suspension of the Union bank had a bad effect on the Borough, which was known to be in the same position.

14. December 29, 1910 The Evening World New York, NY
Article from The Evening World, December 29, 1910

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# DOUBLE FAILURE OF FIVE BANKS BLAMED ON STATE Depositors Ask Why Banking Department Allowed Doors to Reopen. NOT CHENEY'S DOING. Cause of Crippled Institutions Was Pleaded Before Clark Williams. Since the closing last Tuesday of the Northern Bank, a reorganization of the old Hamilton Bank, which went down in the panic of 1907, there has been considerable talk in the financial district as to why the State Banking Department ever permitted the institution to reopen its doors. Thousands of citizens were attracted by the bold advertising methods of Joseph G. Robin in getting new accounts. These new depositors did not know of the bank's inheritance of bad securities from the Thomas-Heinze-Morse regime, and they now blame the Banking Department. Nor are the depositors of the Northern Bank alone in their plight. Four other institutions that failed in 1907 were permitted to resume business upon what subsequently proved to be an altogether unsatisfactory financial basis. The Five Which Failed Twice. The five banks which have been forced to fall twice are as follows: | | First Closing. | Reopened. | Finally Closed. | | :---------------------------- | :------------- | :-------- | :------------- | | Hamilton Bank (Northern Bank) | Oct. 24, 1907. | Jan. 20, 1908. | Dec. 27, 1910. | | Williamsburg Trust Company | Oct. 25, 1907. | June 7, 1908. | Dec. 14, 1910. | | Mechanics and Traders' Bank (Union Bank) | Oct. 25, 1907. | Aug. 17, 1908. | Apr. 5, 1910. | | Borough Bank | Oct. 25, 1907. | Apr. 14, 1908. | Apr. 7, 1910. | | Jenkins Trust Company (Lafayette Trust Company | Oct. 25, 1907. | Apr. 15, 1908. | Nov. 30, 1909. | These five institutions did not get permission to reopen from the present head of the Banking Department, Orion H. Cheney, but from his predecessor, Clark Williams, now State Comptroller. Many Depositors Got Out. Mr. Williams permitted these banks to resume after hearing the cause of each institution pleaded by able lawyers hired by the principal directors, and strongly seconded by petitions from the then depositors. But many of these early depositors after the resumption withdrew their money, and the brunt of the second closing appears to have fallen upon an entirely new class of depositors, who now blame the Banking Department for permitting the failed banks to reopen.

15. May 3, 1911 The Evening World New York, NY
Article from The Evening World, May 3, 1911

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DIX ASKED TO AID DEPOSITORS OF THE UNION BANK Fold Not a Dollar of $4,000,000 Held by Brooklyn Institution Has Been Paid Them. ALBANY, May 3.-Gov. Dix's aid was asked to-day by a large delegation of depositors of the collapsed Union Bank Brooklyn to use his inuuence to bring bout the passage of Assemblyman Gold'stein's bill appropriating $50,00 for a legislative investigation of the Union Bank and any other State bank or trust company in process of liquidation which would warrant investigation in the committee's judgment. Assemblyman Goldstein, as spokesman for the delegation, told the Governor of the failure of the bank during the panic of 1907, of its subsequent rehabilltation under the presirdency of Edward H. Grout, former Comptroller of New York City, and of its reopening with the consent of Clark Williams. who was then State Superintendent of Banks. When it again closed in April, 1910. 1t had on deposit about $4,000,000, and not a dollar has been received by the depositors. Clark Williams was criticised for permitting the bank to reopen and Superintendent of Banks Cheney for allowing it to continue, while District-Attorney Whitman of New York was praised for his "fearless and honest prosecution of the banking thieves that wrecked the Carnegie Trust Company and the Washington Bank." Supt. Cheney, who was president during the thearing, was asked by the Governor if some of the real estate loans made by the bank were not excessive. Mr. Cheney replied that they would have been under present laws, but were not illegal at the time they were made. When the Governor asked If the Banking Department ought not to have interfered and investigated matters complained of, the Superintendent declared that he was not at the head of the Banking Department at that time. The delegation attended a hearing on the Goldstein bill before the Assembly Ways and Means Committee later in the afternoon.

16. July 14, 1911 New-York Tribune New York, NY
Article from New-York Tribune, July 14, 1911

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TELL OF UNION BANK Glbert Elliott and W. C. Damron Served with SubpΕ“nas. INQUIRY STARTS MONDAY Thirty Witnesses To Be CalledDepartment Ready for Thorough Probe. Subpenas were served yesterday on GllElliott, of No. 44 Court street, Brooksert and W. C. Damron, of No. 291 Monm. street, Brooklyn, to appear before tague Tuyl, of the State on Monday, and tell they know about the affairs of the what Union Bank, of Brooklyn. Damron, closed was a director of the bank when it who known as the Mechanics and Traders' Bank. vsa and David A. Sullivan, was presihas unpaid notes in the bank to the mount dent. of $40,960. dating back to Septem17, 1908. He is also an indorser on dotes W of David A. Sullivan amounting to $150,000. Gilbert Elliott, who is a lawyer and real estate man of Brooklyn. was concerned in the Onslow & Moore Company. the Essex & Lee Company and the Camden ConstrucCompany, all of which were known as Sullivan tion companies and were, it is said, intimately connected with the bank under the Sullivan regime. Subpenas have been issued for David A. Sullivan and James T. Ashley. Ashley was vice-president of the bank under Sullivan, and when It was reorganized as the Union Bank and Edward M. Grout became its nresident, Ashley was made cashier. He was retained as one of the representatives of the State Banking Department when the bank closed for the last time in May, 1910. The Banking Department has discovered that many books and papers and leaves from ledgers have disappeared since the bank was closed. Sullivan is wanted to cell about some of the real estate operations in which he was concerned and in which the bank played a large part. nformation is especially wanted from him as to those operations that took place at about the time the bank was closed when he was at the head of it. Hearings Up to August 14. About thirty subpΕ“nas have been issued altogether for hearings running up to August 14. Mitchell May, Assistant District Attorney of Kings County, who has been assigned to assist Asemblyman Louis Goldstein in the investigation. has secured the use of Part 6 of the Supreme Court of Kings County for the investigators. After the hearing on Monday there will be an adjournment for a week, as Assemblyman Goldstein has to be in Albany for the closing sessions of the Legislature. Mr. Goldstein will act as an assistant to the State Banking Department and W. E. Dodge, who has been in charge of the Union Bank for the State Banking Department, will preside at the hearings and represent Superintendent Van Tuyl. Beginning on July 24 It is intended to hold daily hearings until the investigation is finished. For the last ten days the State Banking Department has been making a search of the records of the office of the Attorney General in Albany, the office of the Secretary of State, the State Controller's office and the Insurance Department for evidence bearing on the closing of the bank. Evilence was sought in the office of the Secretary of State concerning the many incorporations in which Sullivan played a part and the bank was an important feature. The State Banking Department in the meantime has turned over Its records to Asemblyman Goldstein. who sought certain etters. having an important bearing on the dreumstances attending the reopening of the bank. It is this feature of the case that is exDected to receive the first attention at the public hearings. The bank was reopened by an order of the court and against the judgment of Clark Williams, who was then Superintendent of Banks. The representations that secured the permission for reopening will be a subject for minute inquiry. Mr. Goldstein and Mr. May will have a conference to-day to decide on the order in which witnesses will be called and (be general order of the inquiry. Mr. May to Co-operate. Mr. May will at that time turn over to Mr. Goldstein the large amount of information in regard to the closing of the bank that has been gathered by the District Attorney's office. Mr. May is desirous of CO-

17. July 26, 1911 New-York Tribune New York, NY
Article from New-York Tribune, July 26, 1911

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BANK CLERK AN ACCUSER Head of Windsor Trust Company Admits Charges Are True. BIG MEN ARE INVOLVED Clark Williams Makes Revelations on Stand in Union Bank Inquiry. Clark Williams, president of the Windsor Trust Company, identified on the stand yesterday morning at the Union Bank inquiry in Brooklyn an anonymous letter he, as State Superintendent of Banking, had received in the summer of 1908 charging gross irregularities in the conduct of the bank before the panic of 1907 and successful attempts at concealment after the panic. James T. Ashley, vice-president of the old Mechanics and Traders' Bank, which became the Union Bank when it reopened following its failure at the time of the panic, and K. A. Southworth, assistant cashier, are the men particularly accused by the writer, who wrote that he was formerly in the employ of the Union Branch of the Mechanics and Traders' Bank, and who signed himself, "A Young but Honest Bank Clerk." Mr. Williams said he had never been able to identify the handwriting of the letter or to find out who the writer was, but he said he had investingated the charges the letter contained and_ found some of them to be true. That part of the letter embodying the charges follows: James T. Ashley has made false reports to the Banking Department for upward of three years, and has tampered with the books of the bank just prior to each examination by your department. As treasurer of the Orr Construction Company, a subsidiary company of the bank, Ashley was guilty of many irregularities. The books of that company were kept by Ashley and will show where the company was credited with several thousand dollars of sundry accounts charged off customers' ledgers. They will also show that certain profits of the Atlantic Branch were transferred to the Union Branch, and there credited to the Orr Contracting Company, who in turn paid it over to Mr. Sullivan, one entry of over $4,000 in particular. An examination of the ledger containing the three Cheeseborough accounts will show a temporary debit of $100,000 against one of the accounts last October for the purpose of concealing a certain transaction from Examiner Hatchins. Sullivan's account about that time will reveal a handsome overdraft unless Southworth or Ashley have since manipulated the books as has been their custom. When Mr. Hays made a special investigation of certain questionable transactions for the District Attorney last winter. Southworth, then assistant cashier, visited the Atlantic Branch at midnight, prepared certain debit and credit tickets in blue pencil to conceal the right channel through which certain profits had passed, involving Mr. Sullivan. All incriminating evidence was destroyed by Southworth that night. and the books falsified. As a result Mr. Hays's report contained nothing upon which the grand jury of Kings County could find an indictment. Southworth also forged some paper which found its way to the Home Bank, of Brooklyn, and later was taken up.

18. August 25, 1911 New-York Tribune New York, NY
Article from New-York Tribune, August 25, 1911

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# MAY HALT BANK HEARING Cropsey Would Examine Grout Himself as to Union's Affairs. There is a possibility that to-day's hearing in the Union Bank investigation, which is being conducted at the Kings County courthouse by Assemblyman Louis Gold-stein, may be adjourned if Edward M. Grout does not appear in accordance with the subpΕ“na served upon him a couple of days ago. Ex-Police Commissioner James C. Cropsey said yesterday that he did not intend to take up the conduct of the bank during Mr. Grout's presidency until he had a chance to examine him, as he did not wish to put the lawyer on his guard. At to-day's hearing, some witnesses may be examined as to the transactions under the Sullivan regime and at the time of the suspension, If Mr. Grout does not appear.

19. August 28, 1911 The Evening World New York, NY
Article from The Evening World, August 28, 1911

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# CROPSEY PLANS # TO FORCE GROUT # ON THE STAND If Ex-Comptroller Doesn't Answer Wednesday Attorney Will Go to Court. # FOREMAN GOT STUNG. Signed a $50,000 Note and Union Bank Investigators Wanted the Money. Queer banking methods during the time when David A. Sullivan was running the Mechanics & Traders' Bank were revealed at the investigation into the failure of the Union Bank before Deputy Superintendent of Banks Dodge in Brooklyn to-day. The evidence taken once more brought into the affairs of the wrecked institution the name of Heinze, but whether it was F. Augustus Heinze or some other Heinze who figured in the transaction was not revealed. James C. Cropsey, counsel to Assemblyman Goldstein, who is running the investigation, announced that on Wednesday morning, unless Edward M. Grout changes his tactics before that time, an application will be made to Justice Putnam in the Supreme Court for a body attachment for Mr. Grout. The object of the move is to force Mr. Grout to testify as to affairs in the Union Bank while he was president of the institution. Mr. Cropsey has mapped out a plan whereby he believes he can have the legality of the investigation and the power of Mr. Dodge to compel witnesses to testify settled by the courts without much delay. Randolph Hulshart was an interesting witness in to-day's proceedings. He is a building foreman and some years ago was employed by Gilbert Elliott, whom he had known for many years. "Mr. Elliott came to me one day," said Hulshart, "and asked me to sign a note in blank. He said it was to go to the Mechanics and Traders' Bank to take up a note made by one Heinze and that it was merely a matter of form and I wouldn't have to worry about it. "After the Union Bank failed I was called upon to pay a note for $50,000. That was the first I knew of the amount of the note I had signed in blank. I couldn't pay $50,000 or a considerable part of that sum. I never got a cent of value for the note." John A. Sell, President of the People's Security Company, a Sullivan concern, from 1907 to 1910, and Charles M. Smith, manager of the Atlantic branch of the Mechanics and Traders' Bank, testified to transactions which they were ordered by Sullivan to carry out. Smith said Sullivan called him on the telephone on one occasion, told him the bank examiners would be around the next morning and directed him how to make entries covering up transaction which would not have passed the scrutiny of the State Department of Banking.

20. September 2, 1911 The Evening World New York, NY
Article from The Evening World, September 2, 1911

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"Union Bank depositors of a hasty habit of mind have announced in publice places that they would like to have Mr. Grout tell - his bank did with their gavings and running accounts. of course they can't find out from Mr. Grout. A depositor in a defunct bank in Brooklyn has the same individual rights as a deaf and dumb man at a political convention. "After trying in various ways to get a peep at their money, or a smell of their money. to say nothing of a feel of it. a committee of depositors got Assemblyman Goldstein to roar for them. Mr. Goldstein solicited and obtained the aid of the State Banking Department and of Mr. James Cropsey, who is said by policemen to be one of the best lawyers they ever worked under. Mr. Goldstein and Mr. Cropsey set about a.scertaining from Mr. Grout if he knew whether the $4,000,000 deposited in hi; bank is still on the job. "Now Mr. Grout has attacked the inquiry and invoked the aid of the law and Martin W. Littleton. He sets forth that Assemblyman Goldstein is not a proper person to inquire about the Union Bank depositors' money and that Mr. Cropsey's motives are open to suspicion. In the meantime the statute of limitations is working twenty-four hours a day. Brooklyn people have always been

21. October 12, 1911 The Salt Lake Tribune Salt Lake City, UT
Article from The Salt Lake Tribune, October 12, 1911

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Charged With Falsifying Records. NEW YORK, Oct. 11.-Indictments charging misdemeanors in making false reports to the state banking department were found by the grand jury today against former City Comptroller Edward M. Grout and James T. Ashley, cashier of the suspended Union bank of BrookIsn. of which Grout was president. Both pleaded not guilty.

22. February 3, 1912 Perth Amboy Evening News Perth Amboy, NJ
Article from Perth Amboy Evening News, February 3, 1912

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COURT FAVORS GROUT. Indicted Banker Wins Appeal-New Question of Law. New York, Feb. 3:-AH investigations by the state banking department into the affairs of collapsed banks where dishonesty on the part of officers is suspected is now suspended. The reason for this was the decision rendered by the court of appeals in the case of the banking department against Edward M. Grout, formerly president of the Union bank of Brooklyn. This decision holds that Mr. Grout was correct in his contention that he could not be forced to testify at the investigation into the affairs of the Union bank. The court says that while the department has every power to investigate the condition of a bank while the bank is doing business, it has no power to hold examinations after it has taken possession of the Institution. Mr. Grout. David A. Sullivan and four other officers and directors of the Union bank have been indicted by the grand jury of Kings county on the evidence brought out at the banking department's investigation. District Attorney Cropsey. who was inquisitor general for the banking department in this case. said he did not believe the decision of the court of appeals would interfere with the trials of the men indicted.

23. May 28, 1912 New-York Tribune New York, NY
Article from New-York Tribune, May 28, 1912

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CALL MORE UNION BANK MEN Other Indictments Hinted at When Inquiry Is Resumed. At the resumption of the Union Bank hearing yesterday it was hinted that several more indictments might be forthcoming before the end of the month. The inquiry was directed on the note transactions of the Sullivan regime. Several of the directors at that time were summoned to the grand jury investigation yesterday. Among those called were Barth S. Cronin, Leo Schlessinger. William Strasser, F. F. McCook, James N. Brown and Charles E. Ring. These men. it is said, owed the bank money at the time of the panic in 1907. F. C. Penton, who had charge of the Clearing House work of the Union Bank during the panie, and was used as a dummy by James T. Ashley, the cashier. and David A. Sullivan, the president, both of whom are under indictment, was summoned. He signed papers as a trustee in a $148,000 note transaction. and was also used in the Hamilton Bank deal. The latter transaction is to be probed in June, and it is probable that he will be summoned to testify. District Attorney Cropsey is personally in charge of the work, and is aided by his assistant, Louis Goldstein. and the State Superintendent of Banks.

24. October 3, 1912 New-York Tribune New York, NY
Article from New-York Tribune, October 3, 1912

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BANK CAN'T PAY IN FULL But Union Depositors May Get Whatever Is Coming Soon. E. L. Dodge, a Deputy Superintendent of Banks, in charge of the liquidation of the Union Bank, announced yesterday that the Institution would never pay dollar for dollar, according to the recent inventory made of its assets and liabilities. Other experts who have recently looked into the affairs of the bank have asserted that 50 cents on the dollar was the most to be expected. However, what little is coming to the depositors may come soon. The payment of $240,000 on a $500,000 note held by the Metropolitan Trust Company is the chief obstacle to readjustment, it was pointed out. Mortgages on nearly all the real estate owned by the Union Bank are being held by the trust company as collateral, part of the security being $191,000 in bonds and mortgages on the Liberty Avenue Theatre, in Brownsville. These bonds are not due. Mr. Dodge secured the release of a $48,000 obligation against the Union Bank due to a lease which had four years to run. He rented the rooms which the bank had leased at the Temple Bar Building to another bank. According to his investigation, once the Union Bank is released of its $240,000 obligation to the Metropolitan Trust Company, it will have as part of its assets about $500,000 in real estate. Suits involving more than $1,000,000 and now pending are expected to add several hundred thousand dollars to the assets.