Ogden Weekly Standard | 1905-12-01 | Page 2 | Insurance Officials Were Law Unto Themselves

INSURANCE OFFICIALS WERE i LAW UNTO themselves one company had inconspicuous stipulation that unlimited premiums could be charged barbells Tar bells commissions new york nov 28 just before the insurance committee nd for ahe day chat T jingles JIng hes counsel for tho committee produced a poncy written by the mutual reserve life insurance company upon the lifo of an unknown man which policy stipulated upon allo first page th atthe injured should pay a fixed and stated premium subject to other benefits and requirements elsewhere stated on page two of policy mr hughes read a clause that ibe executive committee of the company could require the holder of the policy io pay any multiple of the amount of the premium on the first page which the committee saw fit george D redge vice president and actuary of the company to whom mr hughee read the policy aard that the number of such issued was email previously ishmund D randolph treasurer of tha new york lite insurance company hal eald that it was true that he received worth of new yoa city stock from the vaults of tho company and put check of the central national bank for that amount in place of it on jan 15 isoa sir randolph that ahe bann batted the for clant one cf which was the bante trust company lie promised to give the committee later tho jamea of any officers of tha new york lito insurance company then in the Merchants Trust company tha deposition of george H squire formerly financial manager of tha life in which hafl some of abo of the which included of that was to thal among jamee W alexander jama H thomaa D jordan and W H r i the fact that the new york security and trust company paid to andrew hamilton the legislative agent out of moneys belonging to the now york life insurance company wag ulo brought out today ly ir II W S a tuler t uler in inget told the that in ha bought new orleans traction bonde ot a face value of from ill new york alfs insurance mcannany ccann any tal orge W pei kins of the new ork life insurance company fund giving them his checks amounting to 1 payment and then borrowed the boo from the new york life insurance company using the bonds as collateral sold the bonds giving the new york life insurance company 95 per cent of the profits and keeping 5 per cent the stock was absent troia jan hii 10 jan ath he thought tharo were other similar instances ho agreed with air hughes in the conjecture that it was done to some one to put them in as nontaxable non taxable securities mr randolph said he understood the central bank accounted tor the merchants trust company in the transaction and possibly for others the lending of for such a purpose was repugnant to him he said and lie would not do it there was one other case chero bonds acre loaned and it was good business and citizenship but they nontaxable non taxable bonds it was a lime of financial stress when the secretary or the treasury demanded high class the new york life deposited massachusetts and new york city bonds with the united states goi eminent for the first national bank of this city and for that besides liue iest william S h fanshawe member of he banking firm of harvey fask co was called M questioned him concerning h new york lifo insurance company dealings in anuw orleans traction stocks mr said that in december be bought from the new york life 1 is nance company new orleans traction blocks of the fice f ice maluy of of the stock he received in face value worth i from the new york security and trust company aud of facy value actual value from cgeorge W parkins trustee of the kllc fund air Fans aae gae his checks for to the company and to mr perkins and then borrowed from the new york life insurance company oa the bonds as collateral he then sold the bands and paid 05 per cen l of the profit ti the new york life insurance complin sir fanshawe said hp v as in an account with tha new york life to purchase of long island railroad bonds in which the insurance company carried the enilio lot of bonds fur the into iet and ie a profit of chlio mr Fans hawes profits wore half the bonds were owned by mr fan and he sold hem all he made the arrangement through mr perkins and mr randolph but did not divide his own profits on the deal with an one connected with thy new york life ini branc company do yon know of au reason eliy bic new york life if it was milling io advance ho money to carry heie bonds should not have bought ahe bonds outright aud employed iou is broker ID sell them asked mr yes because by going bulb 1119 joint account with me they got the benefit of my both in buying bonds and them they never paid me anything for that but they got one halt of the net said mr Fanshi WB mr fanshawe said that ho adver at any tonic gave to any one connected with the ew york afo insurance company directly or indirectly any share of any profit s la an joint transaction alth york lire mr hughes read the of george H squire formerly financial manager of the equitable life insurance society which was taken several days ago mr squire was asked about the purchase 0 shares of the lawyers title insurance company bi the equitable society at i share fifteen hundred of the shares were divided among officers and directors and the equitable society kept it was desired to hava it appear however that the Equla blo had bonghi the entire 2000 beares mr squire took shares and after aid sold a similar amount to and squire v ho subsequently sold a similar 10 tho equitable society at mr squire wag asked about of stock of the Law yera mortgage company uy the american deposit and loan company to thy equitable society oci ety and was asked if the american deposit and trust company did not any the profits of the sale to lum mr said he did not know io whom the profits went in reply 10 bi mr mr sault o said pome of tho of the equitable hold their holdings of the lawyers anlo ance company stock inay auvo sold it through squire hib att emlon was called to sales of several brecka of be at JOO to by ahn t farm to ho equitable life assurance bin ha did not know athla stock caad from the officers py ilie he said that M and camu jordan aboy some lie did not know mr aquire Ws ashod about olal account II 11 hyde r II 11 mcinis e H to buy blocks of block or iho Law mortgage com piny he eald ih albek was sold to ahn by the american deposit ind I onu om tom t pany and the bembera ot tho holni account got of ho ans asked about ibe georgc H esquhe trustee account binl record HD balat the gains credited to thit account on securities turned oyer by T jor dap comptroller of the society and which he belon eod to the equitable society it was shown that a check of d idaa drawn against the account to jainel V alexander president of tho society mid endorsed by him over to W alexander account no 3 Other larg pr pay ineata were made to he mercantile anit company the equitable trust company and to B J jordan mr said much of the block to georgo H and as was divided among tho members of tho executive committee of tho society mr squire said that george H esquiro and look pt chicago burlington railroad stock of which the equitable society waa allotted and the society paid tho coll biado upon the squire this was tho only case mr esquiro said in which the society paid the call for the anew tiers of alie syndicate mr squire said hf had made a net loss ot in the james H hyde and associates operation he also made leases n other syndicate lawaence Law lence L tle equitable trust co produced 0 alic equitable trust company ot the purchases and bales of stock ot alio lawyers mortgage company by too american deposit and trust company tills that bharka of tho title insurance company were bought by alo american deposit ws loan in 1891 and bold the profits to the american deposit and loan corn pany in alle pur chases and sales of this stock in hushes also read a statement showing that the equitable society 1 P chased worth ot the lawyers title insurance company stock alfred main one of the auditors ot the equitable society testified that he had made a computation of the renewal commissions paid to gage sa tarbell vice president of alie equitable society mr hughes asked him to produce his calculations as to how much mr tarbell was entitled to when the computations were made the renewals ran for 21 years under the policies written through mr tarbell s agency the computation showed that the present alue of the commissions based on duration of the policies was and that they would pay him a year the longest of them was good for twelve years mr main to biang la detailed figures of his computation george T allson vice president of ohp equitable solely was the next mr ahon wai shown statements he mado to ent of tince hendrecks showing thai abo cosi of getting new business in australia is 2 percent of lie ne v te france SS 13 1 3 per cent and in great origin mr haid he had deducted the chai of cai caien Tn the old business from choso mr hushes beough out that mr wuen had had also made allowance or the fact that the paid only 3 l ai percent renewal commissions lib compared with 7 12 1 2 percent paid in tho united states if the latter reductions were not made the cost of new in would have been percent and in great W why did you keep on paying koiv to gel than it was worth asked mr dugum in the hop of fan said mi under the nw management the society hlll not continuo to do busl nos in any district which ia unprofitable the british business Is gilt edged a profit is made on the moria llly it is a long lived business rastus S randole Ran dome counsel for george H squire of the equitable life assurance society next testified ho produced a statement showing that a profit of more than had becci paid to mr squire by the american deposit and loan company as a result of transactions in the stock of the lawyers title insurance company and the lawyers mortgage company mr produced checks showing a of profits by mr squire as follows james W Alexander james H hyde thomas D jordan and W H george I 1 eldredge Eldred gc vice president and secretary of the mutual reserve insurance company was next called ho said the statement of the assets and expenses of his company in 1901 in the blue book of the new york insurance department was grossly inaccurate he made bian v corrections the salary of the president pies ident of ane company he said vas increased in 1899 from and expenses to mr hughes said the business then did no warrant an increase in salary but mr eldredge Eldr edgo said that it was paid because the president was earning it mr hughes read a statement showing the increase in the salaries of the officers of reserve lite in company since 1882 the presidents salary in that year was 3 and it increased until 1893 when it was it was cut to in and was after up to the present mr eldredge aard he was paid a salary as vice president and secretary and the second vice president was also paid ft salary as counsel wro T eldredge Eldred gc one of tho assistant secretaries la a son of ho first vice president mr hughes then called mr eld dredges attention to tho complaint bad been made by davia hall to governor folk of missouri which came up a few days ago mr eldredia Eld redga was asked to look the case up mr Bl dredge said that as mr hall stated he is a policy holder to the extent 0 in the mutual reserve life insurance company and hat a lond of 87 had been credited to mr halls policy at tho end of the first five years period in 1891 but that the bond had been entirely wiped out by special assessments sess ments before it became available for mr hall in 1901 the special assessments in one ear he said were in addition to the regular and mr hall would have had to pay them in cash of ho had not been credited with alie bond mr eldredge said hall had paid into the company on this policy and when asked if mr hall atall owed 1300 to the company as he had staled mr eldredge baid that is as I 1 explained when I 1 testified before mr linguai then produced u policy for britten by abe mutual rc sene life insurance ranco company in 1891 and ached if that aa albo subject to special assessments mr eld fedgo said that it mas mr hughes alin read the stipulations on tho first page of alie policy which provided that tho hodar should pay 2330 on certain od months in each year aa subject to ibo benedita bene fita and elsewhere slated in this policy ID reply to a question by mr hughea mr gald there wis no other allusion on the page to any other ihan alio regular asief ment but that ilio eplion permit clug the special was contained in a clause on abe page of the policy mr hughes read that clause which provided that the holder of tho policy might bo required to pay to the company an multiple or fatla of the premises staled on the chich the executive committee of the mutual reserve lifo insurance company might determine on multiple ho bald might mean two three or any number of limes clause mr eldredge Eldr edgo said waa tho only advice to the insured that ho could be compelled to pay more than the premium of 2390 he said that very few such policies were issued the committee then until tomorrow