Knoxville Banking & Trust Company (Knoxville, TN)

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BANK CRASH HITS GEORGIA INS

CO. KNOXVILLE, TENN., Dec. 17.-The Georgia Life Insurance Company, according to reports here, is on the bond of the Knoxville Banking and Trust Company to secure the $38,000 deposit of the state of Tennessee carried in the bank, which went into the hands of a receiver yesterday. Representatives of the company here are investigating. The Georgia Life Insurance Company has home offices in Macon. The state insurance department at the capitol has no record of the company's outside bonding business, those records being kept at the home office of the company. However, the records are available to the insurance department when called for.

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To Arrest Bankers

Knoxville, Tenn., Dec. 16.-A warrant was issued this afternoon against W. H. Gass, president, and W. W. Willis, cashier, of the Knoxville Banking and Trust Company, charging them with receiving deposits after having knowledge that the bank was insolvent. The bank closed its doors to-day for voluntary Hquidation, John W. Green taking charge as receiver. Mr. Green states that he hopes to begin a distribution of the assets within sixty days. Assets are $1,500,000; liabilities, $1,100,000.

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BANK OFFICERS ARE ARRESTED GASS AND WILLIAMS CHARGED WITH RECEIVING DEPOSITS KNOWING ITS CONDITION. KNOXVILLE, Tenn., Dec. 17.-A warrant was served today upon W. H. Gass, president, and W. W. Williams, cashier of the Knoxville Banking & Trust Company, charging them with having received deposits after having knowledge of the financial embarrassment of the bank. They waived examination and made bond for their appearance in criminal court. The warrant was a sequel to the closing of the doors of the bank this morning, for voluntary liquidation in a receivership.

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STATE'S DEPOSIT IN THE DEFUNCT BANK Nashville, Jan. 6.-That the state had a large sum of money on deposit with the Knoxville Banking and Trust Company the defunet institution which went to the wall three weeks ago, involving a number of minor banks came to light here Wednesday night. The exact amount of the state'smeney on deposit with the bank is given at $37,750 by State TreasurerG. Tom Taylor, who claims however, that the commonwealth is amply protected by the personal bond of the directors, and by a bank in the sum of $100,000, and by a $40,000 bond executed by a Georgia surety company, the name of which he cannot recall. The capital stock of the bank was $150,000, and it is stated that under the law the state treasurer cannot deposit: with any banking institution a sum in excess of one fourth of its capital stock. The statement of Treasurer Tavlor showsthat he had placed in the bank almost the maximum sum alowed by statute. The president of the failed bank was W. H. Cass, brother-in-law of John C. Houk, of Knoxville, the well-known republican politician. In discussing the liability of the state to suffer financial loss by reason of the suspension of the bank, Treasurer Taylor said: **] tooklevery precaution against possible loss by requiring the personal bond of the directors in the amount of $100,000, and also an additional bond of $40,000 in a guaranty company. I have instructed Atty.-Gen. Cates to institute suit at once to recover the amount on deposit there in my name as state treasurer, and am confident that every cent of the amount will be forthcoming."

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STATE BANK WAS INSOLVENT Knoxville Banking and Trust Company Operated as Insolvent Institution for Three Years. Knoxville, Feb. 18. -Further action was taken in the case of Joseph Knsffl et al. vs. Knoxville Banking & Trust company Monday, when an order for the report and petition of Receiver John W. Green was filed. and they were placed with the court. It is announced, however, that the report will

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SAY DIVIDENDS ILLEGAL.

Receiver Asks Reimbursement for the Amounts Previously Paid.

Knoxville.—Receiver John W. Green of the Knoxville Banking & Trust Com- pany, filed a bill in chancery against directors and stockholders of that de- funct institution seeking to have them reimburse the receiver to the extent of all dividends paid by said bank since January 1, 1908, at which time the re- ceiver alleges the bank was clearly in- solvent, as shown by its books. The first dividend involved was paid Febru- ary 1, 1908, and amounted to $2,500, be- ginning January 1, 1909, and for every six months' period since that time up to and including July 1, 1912. The bank declared a dividend of 3 per cent. Re- covery of these dividends, illegally paid, according to the receiver, would put $34,000 in the hands of the receiver for distribution among the depositors of the defunct institution.

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FORMER BANKER FOUND GUILTY William H. Gass, former Presiident of the Knoxville Banking & Trust Company, which went into the hands of a receiver December 16, 1912, was convicted in criminal court, at Knoxville Saturday of having accepted deposits when he knew or had good reason to believe the institution was insolvent.

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BOB TAYLOR FUND

IS STARTED AGAIN.

The "Bob" Taylor monument committee of Post C, Travelers' Protective association, and of the traveling men of Knoxville, is sending out additional requests for funds with which to erect a suitable monument to the memory of the beloved senator, and contributions in amounts from one dolar up will be gladly received.

The committe placed what money it had with the Knoxville Banking & Trust Co., and so far, the receiver has only paid thirty per cent of the original deposit of about $300. Since that time, contributions have been placed in another bank of the city, and the committee now has a fund of something over a hundred dollars with which to start work agani.

The comittee is composed of W. R. Johnson, chairman; H. W. Hall, C. A. Weller and R. H. Cate, and contributions will be gladly received, and will scure enough money to erect a monument which will be a suitable token of the respect and love in which Senator Taylor was held by all Tennesseans. East Tennessee marble will be used, and it is hoped by the comittee be able to erect it before many more months have passed,

"If every friend of "Bob" Taylor in his city would contribute the small sum of one dollar towards this fund," said W. R. Johnson, chairman of the monument committee, "we would be able to erect in his memory a monument costing at least a thousand dollars."-Knoxville Journal and Tribune.

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Directors Held Not Liable.

The effort of John W. Green, receiver, to recover from the directors of the defunct Knoxville Banking and Trust company for losses the bank sustained through alleged negligence and mismanagement failed before the supreme court.

The higher court's decision in the case, handed down here, affirmed Special Chancellor R. H. Sansom, who heard the case in Knox county, and who held that the directors were not liable. Green, as receiver, sued for an approximate sum of $150,000.

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The effort of John W

Green. TBceiver. to recover from the directors of the defunct Knoxville Banking and Trust company for losses the bank sustained through alleged negligence and mismanagement failed before the supreme court. The higher court's decision in the case, handed down here, affirmed Special Chancellor R. H. Sansom, who heard the case in Knox county, and who held that the directors were not liable. Green, as receiver. sued for an approximate sum of $150,000.

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LOT OF GOOD MONEY WASTED; HUGH M. TATE GOT HIS. While a lot of "dope" has been handed out about the Knoxville Bank and Trust Co., case a great deal has never been given by the Knoxville dailies and weeklies, and it will be our pleasure to let the truth be known. Among the different things which we will publish is the following court record showing where the attorneys for the receiver, received from the funds of the poor unfortunate depositors the reasonable fee of $20,000.00. No. 12465 Joseph Knaffl et al. Against In-the Chancery Court, Knoxville Banking & Trust Co. at Knoxville, Tennessee. This cause came on for hearing on the motion and application of T. A. Wright, R. M. Jones, D. C. Webb and HUGH M. TATE for a further allowance of $10,000.00 upon account of their compensation for services as counsel for the receiver in this cause, and the Court being of the opinion that said motion should be allowed, but that the question of whether or not the fee for $10,000.00 which has already been allowed and paid, together with the fee now being allowed, is more than reasonable compensation for the services rendered and to be rendered by counsel for the receiver in this cause, should be reserved, the Court doth accordingly order, adjudge and decree that such additional $10,000.00 shall be paid to said attorneys at this time, but only upon condition that they shall appear in open Court and agree that when a reference is had as to what is and will be reasonable compensation for the said counsel for their services to the receiver, if it shall appear or be adjudged by the Courts of this State that they have already been paid too much for their said services, then and in that event they will pay back into the registry of this Court and for the benefit of the creditors of the Knoxville Banking & Trust Company such excess as shall be adjudged has been paid to them as aforesaid. And it further appeared to the Court that said attorneys have appeared in open Court and have agreed and bound themselves jointly and severally to pay back into the registry of this Court any such amount as it shall be adjudged they have been overpaid for their said services, and have assented and agreed to this decree in open Court, the court is pleased to and doth accordingly order that the Receiver shall immediately pay said sum of $10,000.00 to said attorneys. Enter, Wright, Chancellor.