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TO-MORRO WS DISPATCH
Will comltt of 13 pages, holding SS
columns. Headers will find therein
everything of interest obtainable in the
realm of news.
ANOTHER BIG- ONE.
TBE D1BPA.TCH to be issued next
Sunday will contain TWENTY
PAGES. TM special features will
be unusually attractive.
PORTY-3TOTJETH YEAR.
IS 1H.
The Napoleon of Finance Out
done by a Slick Gang
of Schemers.
THREE BANKS WRECKED.
Two of the Audacious Has-
cals Overtaken and
Arrested.
A FAITHFUL OLD CASHIER
Discovers the Plans of the Wreck?
ers and Exposes Them
at Once.
&T LEAST 700,000 INVOLVED.
Banks
Bought on Wind Until
Securities Conld be Eeal-
ized Upon.
Their
THE WORK ALL DONE IN FIVE DAIS
A gang of schemers has come to the end
of its tether in New York. "With compara
tively little money they have wrecked three
banks, buyins one after the other, inside of
five days, and paying for them frith -wind,
long enough to get control of the
institutions, get possession of their securi
ties and tnrn them into cash. A cashier of
on6 of the banks the Sixth National dis-
covered the frand and exposed it. and the
president, J. J. Claasen, and his broker,
George H. Pell, were yesterday arrested
and lodged in jail.
rsrscux. teleobim to tub DisrATcn.1
New Yoek, January 30. The news of
the suspension of the Sixth National Bank,
announced to-day, has for its sequel a story
of bank wrecking which, in boldness of con
ception and audacity of execution, must
take rank above even the sublime achieve
ments of Napoleon Ives.
"With the aid of a comparatively small
working capital, a gang of schemers gained
control of three banks the Lenox Hill, the
Equitable and the Sixth National and
stripped them of an amount equivalent to
twice their capital stock.
The last bank to be seized, the Sixth Na
tional, was paid for out of the assets of the
institution itself by using the other two
banks to falsely certify checks to the amount
of three times their capital stock. Before
these fraudulent checks were presented,
sufficient money had been raised on the
assets of the national bank to meet them.
Discovery came through information
given by a faithful employe of the Sixth
National Bank, in time to save some por
tion1 of its property Irom the wreckers.
Prompt action by the National Bank ex
aminer and the authorities secured the
recovery of a fraction of the stolen securi
ties and the prosecution of some of the im
plicated persons.
Two arrests were made by "United States
Deputy Marshals to-night and others are
expected. As far as now appears, the net
amount stolen is about 700,000, which nom
inally falls upon the Sixth National Bank.
The Equitable and the Lenox Hill are
liable to the Sixth National, in the amount
of $150,000 juid, $100,000. respectively, on
checks whieh they falsely certified.
IYES BADLY LEFT.
A'fUrOLEOX OP FINANCE MORE THAN
T' MATCHED.
The Audacity of Ibo Baaenlly Syndicate's
Final Achievement Three Banks
Sobbed of Their Capital and
the Proceeds Dlipoaed
of In Fire Days.
There 'was nothing 'even in the operations
of IvesS SUyner which equalled inJau
dacity the crowning achievement of this
syndicate of rascals In less than five days
they succeeded in robbing three banks of
twice the amount of their aggregate capita)
stock and inluming the proceeds into cash.
Nothing "but unforeseen exposure by an em
ploye prevented the consummation of their
.apparent purpose to strip all three institu
tions of their available assets, beside gather
ing in what could be raised on the strength
of their combined credit.
The plot was of recent hatching, and its
execution began early in December. The
first-institution to come under the control
of the schemers was the Lenox Hill Bank,
at Third avenue and Seventy-third street.
This it a State bank, about three years old,
which had an excellent standing. A new
Board of Directors, with Charles P. "Wal
lack, of Pell, "Wallack & Co., as President,
was -put in charge about six weeks ago. At
about the same time, the Equitable Bank
was organized by the same syndicate, and
began doing business under State laws, in
"West Twenty-eighth street, near Fifth ave
nue. Some Good Men Involved.
In the case of each bank some honorable
men of standing were associated with the
schemers in the management. At the
Equitable, Mr. Jacob Q. Tallman, who is a
millionaire and in no way associated with
the wreckers in their schemes, was made
president. But the executive man othe
institution, until about a week ago, was P.
J. Claassen, the Vice President, who is now
charged with wrecking the Sixth Nation al
in the five days that he ifas its president
Early in the present month negotiations
were begun for the purchase of a controlling
interest in the Sixth National by Claasen
and his associates. Charles Bt. Leland, its
President, personally owned a majority of
"its $200,000 capital etdek. It was said at
th bank to-day that P,
F. 'MacDonald. a
- !
broker at 56 Broadway, acted as agent for
the syndicate in bringing" about the sale.
Others say that George H. Pell, of Pell,
"Wallack & Co., insurance brokers, of 47
Liberty street, made the negotiations.
The Sixth National Bank was one of the
soundest institutions in town, and the cash
value of the assets in its vaults made its
stock worth $350 a share, even if it should
wind up its business and make a pro rata
division of its property. For a long time it
has paid a dividend of 5 per cent annually.
The Most Puzzling Feature.
Claassen and his associates finally offered
Mr. Leland $650, a share for the 1,035 shares
which he 'held. This astonishing transac
tion is the most puzzling feature of the
whole strange story. The offer does not
seem to have awakened the caution ot Mr.
Leland, although, at the price offered, the
stock would net the purchasers, as an in
vestment, less than 1 per cent at tho pres
ent rate of dividends.
Mr. Leland is a wealthy man, and mem
bers of his family have for some time been
urging him to retire from active business.
He accepted the fabulous offer of the syndi
cate. There is said to have been an intima
tion to him that the real purchasers were an
association oi English capitalists. The
terms of the bargain were cash on delivery.
On the morning of December 21 Messrs.
Claassen, James A. Simmons and others
passed over to Mr. Leland certified checks
on the Lenox Hill and Equitable Banks for
the full amount, some $(350,000, and received
in return the 1,035 shares of stock and im
mediate possession of the Sixth National
Bank. Then look place some of the liveli
est financial gymnastics the town has ever
heard of. There was really no money in the
Lenox Hill and Equitable banks to meet
those checks for $650,000, which had been
certified through the influence of Claassen
and his associates, who controlled the insti
tutions. But these men knew that in the
vaults of the Sixth National there was lying
idle fully $800,000 worth of gilt-edged bonds.
HOWITWASWOBKED.
FUNDS RAISED ON THE NATIONAL
BANK'S CREDIT.
Its Gllt-Edced Bonds rinced In the Mnr
ket With the Money Tbus Pro
cared the Other Banks to
be Paid For.
"When Ives bought a railroad he some
times paid for it out of the funds of its own
treasury. These men applied the same plan
to the purchase of banks. They elected
themselves directors of the Sixth National
as soon as the transfer of stock was made,
and, forgetting the preliminary necessary in
national banks, of being sworn in, instantly
set abont raising lands to meet tha checks
which they had delivered to Mr. Leland. They
had just 24 hours in which to do it.
Dr. Leland deposited the checks with a trust
company and they would be presented for pay
ment the next day. In the meantime, Claas
sen, the new President of the Sixth, and his
associates lent themselves large sums from the
hank's cash, on wildcat and worthless securi
ties, and put upon the market the greater part
of the gilt-edged bonds in the bank's vaults.
All their'plans were successful. Their checks
were taken up when presented, and they had a
surplus in addition. They were in complete
control of three banks, and were ready to go
ahead with the execution of their ultimate as
signs. Just what their full plans were nobody knows
but themselves. Timely exposure bv Cashier
Andrew E. Colston cutthemshort. This much
is known: Simmons, Claassen and their asso
ciates control two or three railroads in the
South of shady financial reputation, and also
have contracts with the United States Govern
ment for dredjrinc in Harlem river, in New
York bay and in San Francisco harbor. A
crcat lot of securities of the shaky railroads
was foisted upon the bankas collateral forso
cilled loans, the very day they got control.
Neither of tho mer owned any stock, or
qualified.
One Conspirator Missing.
No trace could be found to-day of J.Kenneth
Watson, another of Claassen's new board,
whose address Is given as 88 Broadway. David
M. Ripley, another member, is a Long Island
man, bavins an office at 60 Broadway. He did
not appear there to-day, and it was said to be
his custom to come to the office but two or
three times a week. It is difficult to name
definitely the men who were associated with
Claassen with a fall knowledge of his plans.
It is safe to saytbat James A. Simmons and
George H. Fell were his intimates In this re
spect. Cashier Colston became convinced, after the
new management had been in control about
four days, that the bank was in danger. Mr.
Colston bis been for nearly 20 years at his
present post, and he made up his mind to pro
tect the interests of the minority stockholders,
and if possible, to punish the thieves. He
went on Tuesday to Manager Camp, of the
Clearing House, with the facts about the sell
ing of the bank's bonds and the discounting
of notes of the new officers upon wildcat secu
rities. He also made known the important fact
that not one of the new directors had legally
Qualified by taking the usual oath of fidelity
and certifying to the possession of tho' requis
ite amount of unencumbered stock, so that
there was not even the color of official power
to protect mum.
Colston Tells His Story.
Mr. Camp promptly called a meeting of the
Clearing House Committee on Tuesday night,
and Mr. Colston appeared before them and
told his story. His Information was promptly
acted upon. National Bank Examiner A. B.
Hepburn was- notified late that night, and be
decided to take possession of the bank at the
opening of business on "Wednesday morning.
He did so, with the result detailed yesterday.
President Claassen appeared at the bank as
usual, yesterday, and when Mr. Heptmrn asked
for an explanation of the unlawful seizure of
the bank's assets, he disclaimed having done
anything irregular. He could not explain,
however, how it happened that no mention was
made on the bank's books of the sale of $622,
000 face-value bonds, having a market value of
800,000. He said he had sent the bonds to
Pell, Wallack fc Co.. to be sold. Taking Mr.
Claassen ith him, Mr. Hepburn went quickly
to Pell. Wallack" C'o.'s office, and demanded
the return of the bonds. He was met by the
statement that tbe bonds .hail been distributed
among brokers, for sale, ana that two-thirds of
them had already teen disposed of.
By means of threats the bank examiner suc
ceeded in securing the restoration of 201,000 of
the bonds, bnt when tbe proceeds of the sale
of the rest was demanded the best that was
offered was Checks to the amount of $362,000,
which was about $110,000 short of the market
value ot the securities. -These checks were as
follows:
A List of the Checks.
Pell, "Wallack ft Co., on the Third National
Bank, 127, 000.
Pell. W allack i. Co., on the Lenox Hill Bank,
3,000.
Pell, Wallsck & Co., on the Equitable llanfc,
150,000.
James A. Simmons, on the Equitable Bank, 50,
ooo. '
James A. Simmons, on tbe Lenox Hill Bank,
tsaiwo.
James A. Simmons, on the Commercial Bank,
(10,030.
Trust Company, 5,000.
James A. aiminuuo, vutucAiiictiuiu jjoan sua
George u. relics, w.,
on the St. Nicholas Bank,
sio. ooo.
J. batterlee &.CO.
ooo.
on the Equitable Bank, foO,-
Mr. Hepburn took tbe checks, to see what
they were worth, but failed to discbarge tbo
obligation. The checks on tbe Lenox Hill and
Equitable banks were certified, but neverthe
less they were protested to-day, when pre
sented, as were all tbe others. Further examin
ation by Mr. Hepburn disclosed tbe most
audacious violations of law on tbe part of
Claassen and his associates. '
The provision of the National Banking act
most frequently violated was that forbidding
the loaning, to any individual, of more than 10
per cent oftho amount of the capital stock of
tbe bank. Thr YrA tnanv Inafift fnrhfrtrlpn
It by this article. Finally Mr. .Hepburn made
l; known ito the members of tbe Clearing House
"""' some oi me tacts ne naa aiscoverea,
and to-day Mr. F. D. Tappen, President of the
Gallatin Bank, .acting for the committee;
brought the matter,' to tho attention of th
United States District Attorney.
MAKING THE AEEESTS.
Mr. Pell Caught After a Chase, bnt Clans
sen Is, Yet to be Found.
About 6 o'clock this evening United
CfflfA CflT-l 1 Tua&l.... til . I L
, u.. -. unwiu, wun ionr stalwart
tdennties. aDDeared nt h R!-rt, -H-.tt,ni
-, . - tr . - - w w,..u akl.W.WM,
Bank with warrents in their pockets for th'e
arrest of Pell and Claassen. The Marshal
refused to say what names appeared on his
warrants, or how many persons he was look
ing for. He sought information at
the bank about the house address of
President Claassen, which is 262 Clinton
avenue, Brookryn, and at least two others.
"When he had learned all there was to know
at the bank, the posse separated.
A few minutes after 9 o'clock George H.
Pell was arrested by Deputy United States
Marshals Bernhard and Cooper, iust as he
was leaving his house at 114 West Fifty
fifth street. A servant had previously told
the marshals that Mr. Pell had gone to the
country and wonldn't be back for some time.
A number of persons called at Mr. Claas
sen's house this evening, and the uniform
response from the servant was that he was
notathome. Deputy United StatesMarshal
Kennedy, who called eirly in the evening,
succeeded in seeing Mrs. Claassen, and
was told that Claassen was out Immedi
ately after he had gone all the lights in tha
house were extinguished.
It appears, by the summary furnished by
the bank examiner, that the total theft from
the Sixth National Bank amounts to a trifle
more than $700,000. The Equitable
and the Lenox Hill banks are liable to
the extent that they certified checks. This
will reduce the Joss of the Sixth to about
$150,000, provided tbe two State banks meet
their obligations.
A VERY LIVELY DAY.
MUCH JUMPING ABOUT IN THE
ERAL BUILDING.
FED'
Mr. Tappen's Story oi tho Transaction Ho
Thinks Leland Was Careless, to
Say tho Least Receivers Are
Now Necessary.
Matters were lively in the Federal build
ins, from noon on. Mr. Tappen had a long
conference with Assistant United States
District Attorney Eose, who has charge of
the criminal business of the office. Then
Mr. Eose and Mr. Tappen went uv to Mar
shal Jacobus' room, and finally Marshal
Jacobus and Mr. Eose and Mr. Tappen
were closeted with Commissioner Shields.
Mr. Tappen said afterward:
The sum and substance of the whole matter
is that Mr. Leland sold out his stock In tho
Sixth National bank to men who paid for tha
stock in the securities found in the bank itself.
Mr. Leland got for his stock S600 a
share. I honld think $400 a share a
pretty good price for it. George H. Pell,
of the firm of Pell, Wallack 4 Co., formerly
of the firm of Grovestein & Pell, conducted
the negotiations for the purchase of the stock.
Mr. T.Pland was. therelore. paid $651000, in
'round numbers, for his stock. He was paid
m certified checks on various uanius,
among others on the Lenox Hill and Equlta
ble. These checks, of course, were not good,
but the purchasers, by quick work, managed to
make them good out of the securities in the
bank itself. The purchasers obtained control
of tha lwnir hv means of the certified checks.
Then they mado the checks good before they
got into the Clearing House, and made them
good by using the bank's property.
Not a Local Election.
The purchasers, Immediately after obtaining
control of the bank, asked the old board of
directors to resign. The old board did so, and
the new men filled the vacancies. The new
men elected P. J. Claassen President of the
bank, but I do not think any of them
took the oath of office, and I doubt If
the election of Mr. Claassen was legal. Mr.
Claassen made three loans, ot $60,000 each, te
the Lenox Hill Bank. Then he took from tho
vaults of the Sixth National Bank, in the Na
tional Park Bank, gilt-edge railroad bonds of
the value of something over $622,000, and
placed them in the hands of Pell. "Wal
lack 4 Co. for sale. Mr. Colston tbougbt
it his duty to lay these facts before the
Clearing House, and he did so. We have veri
fied his suspicions, and have telegraphed to the
Controller ot Currency our opinion that tbe
new Board of Directors should havo no further
control over the bank, and tbat we have de
cided not to allow the bank to exchange
throngh ton Clearing House until matters were
in 9hape- Mr. Claassen said be. was gulltfe'spf.
any wrong doing in selling the securities ot tho
bank, but ho did not givo any good explana
tion. I understand that some brokers on tho street
would not sell tho securities which Fell offered
them. I suppose the bank will go into tbe
hands of a receiver. That is the proper way, I
shonld think. I don't think the customers of
the bank will lose anything. The Controller of
the Currency will appoint tho receiver, of
course.
Leland at Lonit Careless.
Mr. Leland was censured severely, of conrse,
by the Clearing House Committoe for dis
posing of his stock in the way In which he did.
He was careless, to say the least. But I hardly
think Mr. Leland was guilty of intentional
wrong. Mr. Leland is at his home now, down
sick over what has happened. I had a
long conference to-day with Mr. Leland's
lawyer. He assured me that Mr. Leland had
authorized him to say that Mr, Leland would
make good to the depositors in the Sixth Na
tional Bank any and all losses which they
may incur by reason of the present
trouble. Mr. Leland Is a very wealthy
man, and he undoubtedly can and
will keep his worl. All this exposure and
probable consequent salvation of tho f unds,of
tne sixtn jx ationai uanK is one to tne Dang
cashier. Mr. Colston. Mr. Colston's conduct
cannot be too highly commended.
The Lenox Hill Bank opened as usual
this morning, and tried to do business, but
was forced to close abont noon. A run upon
the bank began as soon as the doors were
opened at 10 o'clock. It ir a family bank,
the accounts generally small, and the de
positors many. President "Wallack and the
cashier assured everybody that there was no
danger whatever of the bank bursting.
About 11 o'clock most of the $40,000 cash
on hand was gone, and President "Wallack
went out with checks and securities to raise
more. Deposits of about $400 had been
received. Mr. "Wallack secured about
$20,000, but this soon went also, and by
noon there was almost nothing left in the
bank. President "Wallack then ordered the
doors closed.
NOBLE TIRED OP HIS JOB.
He Is Slated to Succeed Judge Miller oa
tho Supreme Bench.
ISrlCIAL TELEOKA1I TO THE DISPATCn.1
Sy.t Louis. January 36. Secretary
Noble's friends in St. Louis are disenssing
some important private information from the
Capital. Secretary Noble is tired of the In
terior, but still wants to be taken care of, and
that too for all time. It is said he will be
appointed to the vacancy on the Circuit
Bench made by the promotion of Judge
Brewer to the Supreme Bench.
Judge Samuel F. Miller, ot Iowa, of the
Supreme Bench, has signified to tbe Presi
dent his intention to retire next year, so then
Secretary Noble will be promoted to Judge
Miller's seat ou the Supreme Bench. Judge
Miller is 76 years of age, and made up his
mind several years ago to resign.
THE HANGING WAS POSTPONED,
Bnt a Few People Wero Killed to Supply
the Amusement.
Macon, Ga., January 30. Seven thou
sand people, mostly negroes, gathered yes
terday at Morgan to witness an execution
whichwas postponed. The crowd lingered,
however, and there was much drinking. In
the afternoon a riot began between the
whites and blacks, caused by a drunken
negro striking a white child.
Many shots were fired, and one white man
was fatally and three others seriously
wounded. Several negroes were wounded,
but none killed.
THEICE TEIED FOE 11CBDEB,
And Once Sentenced to Hauff, but Now Ha
Goes to Prison.
Peobia, III., January 30. John J.
Farris, who murdered Stephen McGeehee
in April, 1887, was to-day sentenced to 25
years in tbe penitentiary. This is his third
trial for the crime, which was a very brutal
and unprovoked one.
On the first trial he was sentenced to be
hanged, but the Supreme Court reversed
the decision, ana on the second trial too
jury disagreed. ,.
i j
PITTSBURG, FRIDAY,
IMPLYING $2,000,000.
An Iron Failure Near Stoubenville
With Sensational Features.
THE SPAULDIKG WORKS CLOSED
And a Eeceiver in Charge, on Allegations
of a Startling .Nature.
A MINOElTf FACTION'S BAD CHAEGE8.
Xo Boskkctptr to ilandls or Account for Eight Tears'
Business Boodle.
An iron failure, of local significance only
in and near Steubenville, and yet of suffi
cient interest in its fundamental causes to
be of interest everywhere, was sprung by a
receiver's closing the Spauldinglron Works
yesterday. It affects Pittsburg very indi
rectly, if at all.
(SFZCUt TELIOIUUTO TUB SISFi.TCIt.1
Steubenville, January 30. The
Spauldin Iron "Works, of Brilliant, near
here, were taken possession of by John Mr"
Foley as receiver, to-day noon. Highly sen
sational, grave and possibly penitentiary
charges are made against the present officers
of the company with great particularity and
at length, in the petition filed by the minor
ity stockholders, who bring suit against the
Spaulding management. The concern has
aggregated $2,000,000 of sales and no book
or other accounts have been kept.
The announcement of the failure caused
quite a sensation among business men here
to-day. The management is charged in tho
petition for a receiver with gross misman
agementselling at a loss in Pittsburg,
etc The sales of the works, it is alleged,
under the Spaulding management reached
2.000,000, exclusively controlled by them,
without proper accounts being kept.
The receiver was appointed at the request
of Thomas B. Taylor, of Steubenville, and
other stockholders, plaintiffs, against the
Spaulding Iron Company, David Spaulding,
Charles H. Spaulding and Thomas A. Ham
mond, trustees, and David Spaulding,
Charles H. Spaulding, Lewis Clohan,
Wallace, David M. Mattock, "William
Satterfield and John Nicholson, as the Board
of Directors of the Spaulding Iron Com
pany, defendants.
"WHO IS BECEIVEB, AND WHY.
The argument was had at Cadiz, O., on
January 28, before Judge Hance, of Com
mon Pleas, at chambers, and the papers
filed at Steubenville, January 30, when the
receiver, John McPeely, of Steubenville,
filed his bond of $40,000 and went down to
Brilliant and duly took possession. The
order directs him to take possession of all
the property, real and personal. Nnoneys,
credits and assets of every kf.1d
and character, wheresoever fonnd, and
hold and preserve the same until
the further oraer of,the Court; to collect the
claims and sue said Spaulding Iron Com
pany; to make a complete inventory of its
entire assets and their value and report tbe
same to tbe Court. Defendants shall turn
ovf r to the receiver its .swsetsof eerytliffif
and character. "The Court 'enjoins the de
fendants from in anywise interfering- with
the receiver's possession, and prohibits
the defendants from contracting any indebt
edness of the said Spaulding until further
ordered.
The petition sets forth that the Spaulding
Iron Company is a corporation duly organ
ized in 1882 under the laws of "West Vir
ginia, .with its place of business, nearly all
of its property and its officers, belonging in
Jefferson county, O. It has an authorized
capital stock of $300,000, the shares being at
$500 each, and oi such capital stock $296,
000 was subscribed and all paid
except as hereinafter set forth. The peti
tion sets forth the conveyance to the com
pany, at the time of its organization, by
David Spaulding, now its president, of cer
tain coal and other properties at an agreed
valuation of 75,000, and that in considera
tion thereof, certificates for shares of its cap
ital stock should be issned to him to the
amount of $75,000, and this was done.
SUBSCRIBED AND HELD THE $80,000.
The petition states tbat David Spaulding
subscribed to the corporation's capital stock
$80,000, which was to be paid for by him in
moncv, and which stock is now held by
nimseii ana ais son, tne aeienaant, unaries
H. Spaulding, and perhaps by other mem
bers of David Spaulding's family; that the
said David and Charles own or control
$165,000 of its capital stock, and the remain
der, amounting to about $133,000, is owned
by other parties and the plaintiffs.
After the organization of the company it
proceeded to erect, upon the ground so con
veyed by David Spaulding, a 'rolling mill,
with 20 pnddling furnaces and three heating
furnaces nnd a nail factory of 78 machines,
well equipped for the purpose of rolling
nail plate and cutting the same into nails,
together with necessary side tracks, etc
That David and Charles Spaulding, own
ing a majority of the stock, elected David
as President and Charles as Secretary and
General Manager; have kept themselves in
said offices continually, likewise controlling
and managing the business.
That from the organization until Septem
ber 1, 1888, Charles H. Spaulding, as secre
tary, kept no books of account, neither
caused any to be kept; representing that he
had in memoranda, bills and slips the nec
essary data from which books conld be
opened; that he negligently allowed them
to be wet and disfigured by the flood
of February, 1884; that he has no accounts
of the corporation's business ud to Septem
ber 1, 4 1888; that by reason of
his failures to open and keep
proper accounts, he and David have
furnished to the stockholders a statement of
the cost of tbe bnilding and eauipment and
improvements, which didn't actually cost
over $150,000, but which Charles H. Spauld
ing represented to the stockholders as cost
ing about $240,000, and always declined and
reiused to furnish itemized statements
thereof.
A VKET CLOSE COBPOBATION.
Plaintiffs allege that David and Charles
Spaulding have always absolutely con
trolled all money, business and financial
transactions ot the corporation, ahd kept no
account of moneys received on subscriptions
to its stock, refusing to furnish a statement
of the amount collected by them upon the
subscriptions to the capital stock; and they
charge tbat the said David and Charles H.
Spaulding have not paid to the corporation
any part of the $80,000 subscribed
by them to the capital stock, or,
at most, a very small portion thereof:
and as president and secretary have issued
to themselves certificates for $80,000 of capi
tal stock; so subscribed by them, and hold
the said certificates without having paid the
amount, or at least a very small proportion
thereof, represented by the said certificates.
They charge that David and Charles H.
Spaulding have so grossly mismanaged tbe
business that it has each year resulted in a
serious Joss, reporting a $0,000 loss for year
ending Spptember 1, 1888, and for the next
year a $27,000 loss, when, in fact, the loss for
the year ending September 1, 1888, was at
least $14,000; and for the next year $16,000.
,, That .some time in 1683 some of the stock
holders 'undertook to make an investigation
otiuchAccounts of the butHH for previous
JANUARY 31, 1890.
years as had been kept by Charles H.
Spaulding; and they ascertained that bills
to the amount of $11,000 were due to the
corporation, which Charles represented and
insisted had been paid and received;
and such sum of $11,000 was re
covered from the different debtors
and paid to the corporation.
A SET, OP BOOKS FOB AWHILE.
Plaintiffs further savthat during the busi
ness year ending September 1, 1889, Chas. H.
Spaulding did pretend to keep, and with,
probably, reasonable nccuracy, a set of
books, showing the business transacted dur
ing that year, but that since September 1,
1889,'no booksliave been kept by him; that
duriog'the year ending September 1, 1889,
they ran the nail mill of the corporation
onlyll weeks, and the product of the fac
tory was laigely sold and resulted in a profit
of $2,800; that David and Charles Spaulding
then abandoned the manufacture ot nails on
behalf of the corporation and engaged in
the manufacture and sale of muck iron;
that they purchased the pig iron in Pitts
burg, freighted it to Brilliant bv rail,
manufactured it into muck iron, freighted
the muck iron to Pittsburg by rail and there
disposed of it; paid brokerage on the purchase
of the pig iron and on thesaleof the muck
iron, and during the time they were so en
gaged they represented to the "stockholders
that they were making a profit on all
the muck iron so made and sold, when,
as a fact, all the muck iron so made and
sold by the corporation under their manage
ment, resulted in a loss of $2 per ton; and
the present year's business is similarly re
sulting in a loss. That the rail mannfacture
has been mismanaged to a loss, Tbat Charles
H. Spaulding represented the corporation,
after the completion of the rolling mill and
the placing ot GO-nail machines therein, to be
$20,000 in debt, whereas if the money had been
properly collected and applied, it could not
have been and was not expended in the con
struction and equipping of the mill.
WHAT BECAME OF THE BONDS?
The plaintiffs charge that about Novem
ber, 1884, the corporation, for the purpose of
paying the corporation's indebtedness and
providing a working capital, issued $100,000
of bonds, numbered consecutively from 1 to
200, of $500 each, payable to Thomas A.
Hammond or bearer, at (he National Ex
change Bank of Steuberjville, O., due and
payable November 1, 1894. These were
placed in the hands of Djavid and Charles
H. Spaulding, as President and Secretary,
for the purpose of sale. That all of said
bonds were put into circulation only by
them, and they have never made any report
to stockholders as to whether they
were sold, or at what rate, nor the
amount of money they received therefor,
and plaintiffs believe and charge the fact to
be that a portion of said bonds were not
properly disposed of by the said President
and Secretary, but were put into circula
tion for a purpose and in a manner not in
tended bv the stockholders of the corpora
tion at the time their issne was authorized;
that they (said Secretary and Pres
ident) have kept no accounts or register
of tne said bonds or any of them,
and have kept no account of" the amount
received from the sale ot bonds, or any part
of them, and the stockholders have no
means of knowing and do not know what
became of a large proportion of the said
bonds or the proceeds arising from the dis
position of them, nor can they so ascertain.
A LITTLE STOCK DEAL.
That after the issue of said bonds one
Alexander Glass and his mother were the
owners of $9,000 of the capital stock of said
corporation, and that the said David and
Charles Spaulding, as President and Secre
tary, wrongfully and without any authority
took up and cancelled the said $9,000 of
capital stock, and delivered to the said
Alexander Glass ana his mother $0,000 of
tbe said bonds, in pavrnent of the stock thus
taken up and cancelled.
PlaintiffsturtHfmythatDaviJSpaulolng
' aboutWjrearf bid; that said Charles H.
Spaulding has no practical knowledge of
the operation, either of a rolling mill or a
nail factory; that he is a man who has a
very firm and abiding opinion of his own
abilities, and who will not be either gov
erned, controlled or aided by the counsel of
others; and that he is not qualified to man
age either the business of operating the roll
ing mill, the nail factory or the business
of the corporation; that the business of
the corporation during the time it has been
rnn must have amounted in pioceeds of the
sale of manufactured articles to about $2,000,
000, and this has been exclusively controlled
by David and Charles Spaulding without
proper accounts, or their being able to show
what disposition has been made of the
money, or at any time what it cost to manu
facture a ton of muck iron, a ton of nail
plate or a ton of nails.
ANOTHER SIDE OP IT.
There is a feeling of amazement in busi
ness circles here tbat such a serions legal
proceeding as this against the Spaulding'
Iron Company, with such astonishing accu
sations, should have been granted, ex-parte.
by a Judge at Columbus, without notifying
or hearing the other side. It is generally
thought among business men that tbe com
pany is not financially embarrassed; that
the action was ill-judged and entirely too
hasty; that it is a qnarrel among the stock
holders, and possioiy a move to scare ana
squeeze out the smaller holders of stock.
The petition itself admits that, with good
management, the assets are sufficient to pay
Hhe present indebtedness.
THE PITTSBUBO END OF IT.
There seems to be but little known in this
city as to the standing of the Spaulding
Iron Company, or to what extent, if any,
Plttsburgers will be effected by it. Mr. B.
F. Jones, of Jones & Laughlins, had littte
knowledge of either the company or its af
fairs. It was a stock company, operating a
nail factory as well as rolling mills. The
principal business was with "Western people.
Some of the Pittsburg commission mer
chants may be concerned, but who, or for
how much, he had not the slightest idea.
He was inclined to the opinion that the
whole affair had been precipitated by a
quarrel among the stockholders themselves,
which had became so warm that it grew to
be sensational. It would hardly effect the
market to any extent.
Mr. A. M. Byers had not even heard of
the failure or had any intimation of it. He
did not know any of the persons connected
with the Spaulding company personally.
In business circles it was not considered a
strong institution financially, bnt not the
slightest intimation of crookedness ever
came to his knowledge He did not know
of anyone in this city who might be affected
by it.
tflNDOH'S BIIiIi DENOUNCED.
The Colorado Silver Association Do Not
Line It a Little Bit.
Denveb, January 30. Vice Presidents
of the Colorado Silver Association, repre
senting every county in the State, held a
meeting here this evening over which ex
Senator Tabor presided. Several stirring
addresses were made in favor of the white
metal, one of which was made by Mr.
Tabor.
At the conclnsion of the Speaking resolu
tions were adopted denouncing the "Windom
bill in the strongest terms, and demanding
free and unlimited coinage of silver on the
same equality with gold.
F0DE PLOUEiNG HILLS '
Have Been Secured by the English Syndi
cate, With Moro to. Come.
Detboit, January 30. D. B. Merrill,
proprietor of four flouring mills at Kala
mazoo, valued at $200,000, has civen
an option to an English syndi
cate for the purchase of the
properties. It is learned on good author
ity that it is the ulterior desicn of the syn
dicate to get control of all Hhe flour mills
between, this city and,Cbicago, along the
line of tho Michigan railway.
NO NEED OF HYMNS.
The Kew York Presbytery Nearing
the End of Its Long Debate.
VOTING TO BEGIN NEXT MONDAY.
loans Presbyterian Who EelieTea the
Fope to he Anti-Christ.
ANOTHEE PEEACHEE MAKES A BEEAhT.
He Solemnly Declares He Is Not Sncb a Fool as He
Loots.
As it nears the end of its debate on the
revision of the "Westminster Confession of
Faith, the New York Presbytery thinks it
can do without opening its sessions with
psalm singing. This is the last day of the
debate. Voting is to begin Monday.
.'FrECTAI. TELEGRAM TO TUB PISrATCBM
New Yoke, January 30. Before the
New York Presbytery, to-day, in tho Scotch
church, in its debate on tbe revision of the
"Westminster confession, a member moved to
sing one verse of a familiar hymn at each
session after the preliminary prayer. As
his motion was not seconded, the debate was
opened without a hymn by the Rev. Mr.
SchaufHer, in behalf of revision.
"While in favor of the report of the com
mittee recommending revision, the speaker
thought that whether it was adopted or not
there would be no difference in Presby
terian teaching. If a mother, anxions as to
the fate of her dead baby, asked him to di
rect her to a spiritual adviser, he would
refer her equally to a reviser or an anti
reviser, confident that either wonld teach
her the word of God. If a man came to him
in doubt as his being a reprobate he would
do the same, confident that the same answer
would be given by both. Practically, he
was not troubled whether revision succeeded
Or was lost. Both sides taught the same
doctrine, and substantially were one, the
divergence being more apparent than real.
ANOTHEE TOUNO FEESBTTEB.
The Bev. "Walter D. Buchanan, lite sev
eral other of the younger Presbyters, spoke
against the revision. He said that the so
called obnoxious doctrines fonnd in it were
found in the Bible. After acknowledging
that a large majority of his hearers was in
favor of revision, he found fault with the
mode of revision proposed by the committee.
He said that the recasting of the chief part
of the third chapter of the confession on the
lines suggested by the committee would be
inconsistent with the part not recast. He
went on to declare his belief in thesalvation
of babies, but said they were saved not by
their purity, but by Christ; so the heathen,
who led correct lives, were saved not by
their good works, but by Christ. He con
sidered these conclusions consistent with the
confession. As to a statement in the confes
sion, about the meaning of which there can
be no doubt, he said: "I believe the Pope
to be anti-Christ, and Bomanists to be idola
ters. Although 1 acknowledge there are
good Roman Catholics, I think the whole
tendency of the Bomish Church to be away
from God, and derogatory to His dignity
and everlasting sovereignty."
The Bev. George J. Mineins said that,
athooghGodhad predestined hinUpe.a
radical "before tbe foundation of the world,
he was going to make a conservative speech.
After referring to his lack of educational
advantages, he added: "I am not such a
fool as I look."
CONTESTED AT LAST.
Mr. Mingins went on to give some more
personal details about himself. Among
other things he said that when his parents
insisted that he mnst believe in the "West
minster confession he gave up all religion,
and for ten years did not enter a Christian
chnrcb. He was finally converted from the
error of his ways by a clergyman who
preached a God of Love, not the God of con
fession, and he ultimately became a clergy
man himself.
The Bev. A. "W. Sproul in a speech
against revision said: "I deplore that the
discussion has been forced on the Church,
for it is fraught with evil and likely to
undermine the faith of many. It has
brought to light the fact that the Church is
divided against itself a house divided
against itself cannot stand." Elder Thomas
S. Strong, of the Madison Avenue Presby
terian Church, also spoke in favor of revis
ion. He said he thought the Pope to be
anti-Cbrist, but did not know whether a
declaration to that effect was necessary.
To-morrow is the last allowed for debate,
as voting is to begin on Monday, and there
is no session Saturday. After a quarter of
an hour's discussion, it was voted to lengthen
the session by half an hour, and give the
Chairman of the committee which recom
mended revision, Dr. Hastings, the extra
halt hour to defend its report.
A'FIEECE PAIE FIGHT.
The New York Senate Engaged In a Lively
Folltlcal Quarrel.
Albant, N. Y., January SO. The
"World's Fair debate in the Senate to-day
was exceedingly bitter. Mr. Ives, Demo
crat, said that Mr. Fassett did not deny that
as Piatt's messenger boy, he had carried the
new names to Mr. Depew and asked him to
consult with his master. Senator Boescb,
Democrat, read the reporJ of an interview
with H. O. Armour (whose name Mr. Piatt
had added) in which the latter opposed New
York as the site for the fair. He asked
whether Armour was a proper person for a
commissioner.
Mr. Fassett delivered a long address, in
cidentally denouncing Mr. Ives as an "un
repentant rebel, bearing a pirate's name."
The matter is still in an unsettled state.
THE WBECK TOOK F1BE.
Two Killed nnd Severn! Injured In a Crash
Caused br a Caw.
Placqtjemine, La., January 30. This
morning about 4 o'clock, as a west-bound
freight'train on the Texas Pacific was pas
sing Seymourvillo, a cow stuck on tbe track,
which was struck by the engine, wrecking
13 cars, engine 98, killing. John P. Crilly,
conductor, Barney Bliss, engineer, and seri
ously wounding Oscar Pennison, fireman,
and one brakeman, name unknown.
Almost immediately after the accident
the wrecked cars took fire and were entirely
consumed. The body of Conductor Crilly
was pulled out from under the burning
cars by a tramp who was stealing a ride at
the time.
EIGHT LYNCHEES IN JAIL.
Prominent Farmers el tho Indian Territory
Called to Account.
Gainestii.i.1, Tkz., January 30.
Eight prominent farmers of Healsbnry,
Ind. T were arrested in the Indian Terri
tory and brought here to-day charged with
being members of a mob which lynched an
old man in the Indian Territory last No
vember. The United States Commissioner before
whom they were examined directed. them
w dc wmu iiu M. jk.isa.mBt tut kCitU VJ kUVS
"United States District Court, which has jnr-
L isaicuon over vue .tnaias Jtfwry.
ENOUGH TO BEAT H1X
Formal Charges Against Captain Tusmpsou
of SIcKeesDort Accused of Sunday f w
Labor, Foker Playlag and '2,
...-
tsiaor uueoses ocnuua ,
... IL'm .nnntr...
IFBOU A STAVF CORBZ3FOXPXXT. 1
"Washington, January 30. Repre
sentative Ray called upon Postmaster Gen
eral "Wanamaker this morning to learn the
reason ot the delay in the settlement of the
McKeesport postmastership. He found
that several formal charges had been made
against Captain Thompson, which ap
peared very serious to the truly good Mr.
"Wanamaker. In fact, they were so serious that
the Postmaster General intimated he would
probably be forced to ask the President to
withdraw the nomination. Possibly tbe
gravest charge of all is that many of the
names to the petition of McKeesport citizens
asking for the Captain's confirmation were
attached to the paper on Sunday.
in is is apparently a most heinous onense
in the eyes of Mr. "Wanamaker, and might
of itself be sufficient to prejudice Captain
Thompson's case.
Added to this is a charge which is in the
natnre of a confession, signed by young Mr.
Harrison, son of one of the defeated aspir
ants for the appointment, that he Mr. Har
rison, had played poker with Captain
Thompson. The confession was not specific
as to the "ante" or the "limit," and did not
say whether Mr. Harrison lost or won. But
it is probable that a 10 cent limit would be
as hieh a crime, in the opinion of Mr. "Wan
amafeer,asa$10 limit, "table stakes," "freeze
out" or "an open game."
Another charge is tbat when Captain
Thompson grows thirsty in McKeesport, he
actually has the hardihood to step into a
saloon, like other thirsty McKeesporters,and
take whatever drink is most gratefnl to his
palate.
Mr. Ray and other friends of Captain
Thompson" will meet these charges as best
they can, but it is probable that nothing
will save Captain Thompson's bacon except
the signing of a temperance pledge and an
obligation to abjure "penny ante" during
his incumbency, if he be confirmed. The
Captain can claim the right to save him
self in this way on the ground of precedent,
as in the case of the Baltimore appoint
ment. "When it wan discovered that gen
tleman took a drink occasionally, his ap
pointment was allowed to stand only when
he solemnly promised not to take a drink
during his term of office. "Whatever may
be the outcome, the Captain's case certainly
now hangs in the balance, and his confirma
tion depends on the efforts of himself and
friends.
EAEWELL ON HARBISON.
The Chicago Senator Gives the Fabllc His
Private Opinion of the President
How Ho Sizes Dp the
CblrfExeeatlve.
fFnOM A STAFF COBnXSFONPEXT.1
"Washinoton, January 30. Senator
Farwell, of Chicago, is not growing more
enamored of the President as the days pass.
He elucidated bis relations with Mr. Har
rison to-day as follows:
There is no quarrel between the President
and myself. There are no favors for him to ex
tend, and none for me to accept. 1 believe with
the great Lincoln of my State, tbat this Is a
Government of thepeonle, by tbe people, for
the people. To transact their business they
elect certain officers. They elect the President
to execute the laws by a method they hava de
cided on. Then they elect Representatives and
Senators by other methods they have adopted,
the one by the Legislatures and the
other directly by districts. They elect
these Representatives to come here
and attend to their business, solely because
tupy cinpot coma, tbernselves. If the people
could dome here in person, they Would not need
to send representatives. All other officers, the
people have decided, shall be appointed by the
President, bv and with the consent of the Sen
ate. Now, as tbe offices belong to tbe people,
it is the President's dnty to nominate for office,
and tbe Senate's duty to confirm! the persons
whom the people concerned want. It is their
duty, I say the President's duty and my duty
to ascertain and carry out the wishes of the
people.
as tne people cannot corns iiere to leu tne
President who they want for the particular
offices, It devolves npon the representatives of
tbe people to make their wishes in tbe prem
ises known, lhat is one of tbe things the
people have elected them to do. The people
have confidence In the men they select to rep
resent them here, otherwise they wonldn't
elect them. Hence, the President, In listening
to the Senators and Representatives in these
affairs, is only listening to the voice of the
people who elected them.
In the Chicago collectorshlp case the people
wanted Mr. Campbell, the whlteheaded boy of
the Republican party of Illinois. The State
and County Committee and the Republicans
generally wanted Mr. Campbell. Their wishes
should have been obeyed. And so they would,
with a President who believed that tbe offices
belong to the people. The trouble with Presi
dent Harrison is that he seems to regard the
power to appoint to office as a personal privi
lege, and the offices as personal perquisites. I
have nothing to say against Mr. Clark, but he
is not the choice of tbo people of Chicago.
Mr. Campbell was. Mr. Clark is, therefore,
tho personal appointee of the President.
TO HUMILIATE MB. WATTBESON.
Tbe Great Editor gammoned far an Alleged
Debt In This City.
At an early hour this morning, but
too late to admit of the little de
tails being hupted up and given, it
was learned that Mr. Henry "Watter
son, 'tthe distinguished editor of the
Louisville Courier-Journal, was served
with a process known as "summons and ar
rest," in an old action for debt
The editor was about to step
upon the stage in Lafayette Hall, to deliver
his lecinre on "Money and Morals," when
he was accosted by Constable Charles Por
ter, of Alderman- McMaster's office, and
served with a summons to appear in a civil
suit before tho Alderman next Monday
afternoon.
Tne writ was made out at the instance of
"W. S. Thomas, who claimed Mr. "Watterson
owed him $125.
"When the Constable handed Mr. "Watter
son tbe writ, the latter read It and said,
calmly
"That man is craxyi"
He said he would attend to the matter,
however, and stowed the summons
away in, his vest pocket. Mr. "Wat
terson was to leave on an early train this
morning for Louisville. The summons re
quires him to be at the hearing between 3
and 4 o'clock Monday afternoon.
Since the above was written it is learned
that Mr. "Watterson took leave on the 2:15
train "West.
Masked uaeaudebs
Bind and Caff a Woman and Olalce Awny
with the Valuables.
Kansas Oitt, January 30. During his
absence from home this evening masked
burglars entered the house of
Charles' Boonan, at 2434 Mersier
street. Mrs. Boonan was alone
and the outlaws, after they had bound and
gagged her, dragged theunconscions woman
to the foot of the bed in one of the sleeping
rooms and bound her securely by the neck
to one of the bed posts.
After possessing themselves of all the
valuables in sight, they escaped. Mr.
Boonan, returning hope a Jfewj minutes
later., found His witei in tne Muiion ae- i
' scribal and releasadsker. Her conditiaa.ia I
j.serious. t V "NS'f
THREE CENTS
ID IS THERE
V''
Z
Ct1
5?ft
b Speaker Stands by His
s?.
'ermination to De-
w a Quorum
S5V
4&
WHENEVER HE SEES ONE.
All Sorts of Epithets Hurled
at Him by the Angry-Minority.
HE IS EIEM AS A EOOK,
And
Declares All Motions Carried
That Are Voted On by
tbe Majority.
ONE DEMOCEAT WHO WILL TOTE,
Despite His Party's Persistent Continu
ance of Their Former
Tactics.
PEOBABLB E5D OF THE FIGHT HEAR
Yesterday was another day of turbulence
in the lower Honse of Congress. The scenes
were almost exactly similar to those of the
day before. Speaker Beed continues to
count all members he sees, as "present but
not voting," and thus preventing the minor
ity from breaking a quorum. One Demo
crat, Mr. Buckalew, of Pennsylvania, votes
every time. Representative Dalzell thinks
the fight is fought, and that he will be ad
dressing the House ibis afternoon on the
subject of the first contested election case to
be considered.
nT.OH A STAFF COBnZSFOXDEXT.l
"Washington, January 30. Senator
"Vance's neat speech to-day on negro im
migration was sweetness wasted on the des
ert air. In the list of attractions at the
Capitol a humorous lecturer was nowhere
along side ot a circus. The House menagerie
was even more ot a howling bear garden
than it was yesterday, though it had ceased
to be serious and alarming to the galleries,
and merely became funny. Cries of "Revo
lution!" "Tyrant!" "Czar!" ''Usurper I" and
so on did not sound half so exciting as they
did yesterday, and the frenzy of Springer,
Breckinridge and Bland was laughed at
merely as being grotesque and entertaining,
A CHANOE OF SENTIMENT,
The fact is, notwithstanding the attempt
of Breckinridge, Bland, Crisp and Springer
to prolong the fight against the "autocrat of
the Chair" and embitter the feeling against
him, there was evident a change of senti
ment, even among the Democrats. Nobody
will donbt the extreme partisanship of the
venerable Charles R. Buckalew as a Demo
crat, but that gentleman stood firm against
every endeavor to indnce him to refrain
from voting, and on every roll call his name
stood as the solitary Democrat whose vote
went to make up a quorum. Mr. Bucka
lew is a great expounder of the Constitu
tion. On a question of constitutional law
or interpretation it is conceded he has not
his superior in the Honse.
SENT THESE TO TVOEK.
Mr. Buckalew's position is that, under
the Constitution, Congressmen occupy their
seats for action and not for the purpose of
prevention of business by silence and inac
tion. He holds that no faction or portion of
Congress has a right to attempt to break a
quorum by refraining from voting.
It is known that ex-Speaker Carlisle
really agrees with Mr. Buckalew, but as the
leader of his party he is forced to make a
show of being in harmony with it.
More than one Democrat to-day privately
admitted to the correspondent of The DIS
PATCH that the ruling of Speaker Reed li
right and sensible. They would have pre
ferred that the matter should have been dis
cussed and tested upon a report from the
Committee on Rules, embodying the ruling
of the Speaker in the matter ot a quorum,
but now tbat it has come in the way it has
they hope it will be forever settled in the
American Congress that no one man or
number can filibuster for days with dilatory
motions, and absolutely prevent the transac
tion of the business, and that the minority
cannot defeat legislation by refusing to
vote and thus prevent the counting of a
quorum.
THEIB TUBN TO C0SIE.
"While the Democrats may experience
some hardships at this session, they look
forward to regaining control of the House,
and then the very principle which they are)
now opposing will be a tower of strength to
them. Tbey are now led by their leaders.
They feel that as a party they mnst act to
gether, bnt manv of them are secretly glad
of the situation, and heartily agree with the
Speaker.
And this brings up the fact that many of
the Republicans were until to-day fearful
that the Speaker had gone too far. I asked
a prominent Republican Congressman to
day if it was generally understood among
the members of his party that Mr. Reed
would rule as he has in the matter of a
quorum. "No, by no means, was the
reply." I believe if the subject had been
brought up in tbe caucus and voted upon a
majority would have been too timid and
weak to support the proposition. I believe
McKinley himself would have permitted
his conservatism to carry him to that side.
ALL 'OP THESI SURPBISED.
"The Speaker's ruling was as much a sur
prise to a majority of the Republicans as to
tbe Democrats, and at first many of them,
not fully understanding the subject, were
actually frightened at what really was a
startling- coup. Now that they have looked
into the question they are in perfect bar-
Continued on Sixth rage.,,
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