THE OREGONIAN, APRIL 21, 1901
FORCED TO SUSPEND
Vancouver National Bank Closed by Controller
Funds Were Misappropriated
President Brown and Cashier Canby disappeared when Examiner Maxwell took charge-deposits 230,000
VANCOUVER, Wash., April 20—The First National Bank of Vancouver did not open for business this morning. At the time for opening, United States Bank Examiner J.W. Maxwell of Tacoma posted a notice on the door stating that he had suspended payment, and it was in his hands as the representative of the controller of the currency. Charles Brown and E.L. Canby, respectively president and cashier of the bank have disappeared. They have not been seen since Friday evening at 6 o’clock, a blank time after they were notified by J.W. Maxwell that the bank must close its doors. Their present whereabouts is unknown. It is said on good authority that blank, upon being told of Mr. Maxwell’s decision that the bank would not be permitted to open, went out in the blank behind the bank and attempted to kill himself. Go back up to the to this sentence and it will be that Cashier Canby, upon being told of Mr. Maxwell’s decision. His revolver failed to stick something, although five of its chambers were loaded. After failing to shoot himself, Mr. Canby came back into the bank and he and President Brown left together. There is a general fear among their families that they have been — have committed suicide, but this idea is not credited by Vancouver people.
The United States District Attorney Wilson Gay arrived from Seattle today. He said to an Oregonian reporter that he blank he would cause warrants to be made for the arrest of both of the missing men, although until he consulted with Mr. Maxwell he was not certain what he would adopt. Mr. Gay was summoned to Vancouver by Mr. Maxwell.
Cause of Failure
Examiner Maxwell has not yet made a statement of the reason for the bank’s closure. He says he has been positively forbidden to do so by the department. In a general way, however, the reasons for the closing of the bank are well understood.
Simply stated, the bank has loaned too much money on insufficient security. This has not occurred recently. It dates back a long time. For years the bank has been struggling to get out from under the bad debt, and bank examiners who have looked at the books heretofore have blanked the securities of the bank. Mr. Maxwell, however, after making a full examination of the assets, together with the cash on hand, found it to be insolvent. In the last statement of the bank issued in February, shows that it carried about blank deposits, and the result of this closure nearly every one in Vancouver of any financial standing has lost money, or apparently lost more or less money.
Several years ago the bank lent $20,000 to the Michigan Lumber Company and was forced to take this property. This blank was practically a dead loss. The blank are not in operation and absolutely nothing has been realized on the security. It has lent $30,000 on the corner block in the center of Vancouver, and was forced to sell the property which yielded practically nothing. In the same manner, $12,000 was sunk in the Lasco mills (phonetic). Rumors are current that the missing officers owe the bank considerable money on their individual notes, and that they may have accommodated friends with loans. Blank only confirmation of these rumors in a statement which Dr. David Wall, vice president of the bank, made today. He said:
“I pulled out of any active connection with the bank about three years ago. I did so mainly because I believed that the situation — the institution was carrying too much of the debt of its officers, which I regarded bad business — or bad blank. I knew nothing of the banking blank, and that was another reason that I withdrew; but I knew that at blank the institution carried several thousand dollars’ worth of the paper of Mr. Canby and Mr. Brown.â€
Mr. Walls still has stock in the bank, and he says he made a thousand of it to his daughters sometime ago.
Capital Stock Reduced
About a year ago the bank reduced its capital stock from $100,000 to $50,000. At the same time about one-half of the so-called bad assets, including the Michigan Lumber Company property, was “charged off†but one-half of it has been carried as an asset since that time. The directors of the bank are F.N. Marshall, M. Hidden, C.H. Bunk, and Messrs. Brown and Canby.
The heaviest stockholder is Colonel P. Jocelyn of the regular Army, member of General Shaffer’s staff. Colonel Jocelyn is stationed in San Francisco. His post was Vancouver when the bank was organized in 1883, and ever since that date he has been the heaviest stockholder. His influence made Mr. Canby cashier, and kept him there.
The banks weathered the panic of 1893 with much difficulty. It is said that at times it carried nearly 300,000 in deposits with only 5,000 in actual cash in the bank. It was in somewhat better shape when Maxwell closed it. In addition, what cash it had on hand, the amount that cannot be ascertained, it carried two deposits in two Portland banks, the Hide and Leather bank of New something City is in a Chicago bank, and in a bank in San Francisco. Its February statement showed that it had $77,412.83 in cash. How much of that has been withdrawn it is impossible to state. It is learned on good authority that several thousand dollars still remain in the First National Bank of Portland.
Some Heavy Losers
The heaviest individual loser is County Clerk S.P. Gaither. He recently deposited $11,300, which as been paid into court by The Oregon & Washington Railway Company for right-of-way purposes. Skamania County loses $10,000. Clark County has a balance of less than $1,400, most of its money being deposited in Portland banks. Other heavy losers of the city are: City of Vancouver, $3,500; Dr. A.B. Eastham, $3,000; Portland, Vancouver, & Yakima Railway Company, $2,000; David Gary, administrator of the Hertzig Estate, 2,800; C.D. Bowles, attorney, 1,700; James P. Stapleton, Administrator of the Abraham Estate, 3,000. In addition, scores of people, businesses, and professional men carried deposits, so some of them running into the thousands. Several secret societies including the Red Men, both capitalized, the Masons and the Knights of Pythias, deposited with the bank.
The depositors held a mass meeting this afternoon in the Standard Theater. C.D. Bowles presided. A resolution was adopted asking the Controller of the Currency to permit the depositors to select the receiver. A committee, consisting of C.D. Bowls, W.P. Crawford, Jerry S. Harris, M.R. Sparks, A. B. Easton, W.H. Metcalfe, and General J.M. Bacon, was appointed to look after the interests of the depositors.
The utmost good feeling prevailed during the meeting, and there was no fiery talk. Several worthless attempts were made at joking, but the jokers were not given much encouragement. A large number of women attended the meeting and took a lively interest in the proceeding. The hope was expressed among several of the better-informed men present that the bank would be able to meet its obligation to a great extent but that the enforced reticence of Mr. Maxwell has naturally prevented any actual knowledge of the bank’s condition from reaching the public. Mr. Maxwell has been appointed temporary receiver of the bank by Controller Dawes, and as charge of the bank as such, instead of as bank examiner. He will probably be superseded by a permanent receiver.
Mr. Maxwell’s Actions
Mr. Maxwell arrived in Vancouver Friday forenoon on his semi-annual trip of inspection. He worked on the books all day, and it was after banking hours before he notified the officers that the bank could not open in the morning. A deposit of $1,000 was received shortly before 4 o’clock, the regular closing hour. The deposit, however, was dated ahead to April 20, at the request of the depositor.
After notifying the officers that the bank must close, Mr. Canby’s alleged attempt at suicide occurred, and then the two bank officers disappeared. Mr. Maxwell was afraid that they might attempt to get away, and placed a man at the ferry to keep a lookout. They did not go that way, however, and if they left at all, must have crossed the Columbia in a small boat.
Mr. Maxwell consulted with W.W. Sparks, Prosecuting Attorney of Clark County, about the matter, and today Sparks said he had positive authority for making the assertion that there was criminality connected with the failure of the bank. This statement was made on the streets of Vancouver, in the presence of witnesses. After he consultation with Sparks, Mr. Maxwell wired for District Attorney Gay.
Neither Brown nor Canby went to his home last night. At least, that is the statement given out at each house. Their wives are prostrated as a result of the failure, and could not be seen. The opinion is expressed in some orders that Brown is hiding in Vancouver, and that he will reappear at the proper time. It is generally believed that his disappearance was prompted more by a desire to be absent only during the first shock following the failure, rather than to flee from the consequences of his acts and remain away permanently.
E.M. Rands, who is a close friend of Brown, and has acted as his attorney in several matters, expressed the fear that Brown had put an end to himself. Rands says that Brown is of a morose, pessimistic disposition, and that he may do something desperate. Rands and George W. Stapleton of Portland, both of whom have acted as Brown’s legal advisors in the past, say they have not heard a word from him since his departure and profess to be as much in the dark as anyone else concerning the whereabouts of Brown or Canby.
Both Men Well Known
Brown has lived in Vancouver since 1862. His father was the first receiver of the Vancouver Land Office. That’s Vancouver Land Office is capitalized. Mr. Brown has served as auditor of Clark County. He is married and has a family. His connection with the bank as its president dates back about 10 years.
Mr. Canby is well connected. His wife was Miss Francis Burnside, daughter of the Oregon pioneer. He has a brother who is a paymaster in the United States Army. Another brother committed suicide by jumping off the wharf at Vancouver several years ago. J.G. Woodsworth, general traffic manager of the Pacific Coast Company at Seattle, is a brother-in-law of Mr. Canby.
Levi Ankeny, the well-known banker of Walla Walla, visited Vancouver today, and told Mr. Maxwell if there was a chance of putting the bank on its feet, he would take a hand in carrying it along. Mr. Maxwell was unable to tell him anything about the bank’s condition and the subject was dropped. Several prominent depositors are endeavoring to get Mr. Ankeny to take a hand, and if the business of the present bank is closed up, to have him start a bank in Vancouver. As a result of the closing of the First National, there was a small run this morning on the Commercial Bank, the only other financial institute in the town. The Commercial is a state bank. It paid out dollar for dollar as fast as the checks were presented and remained opened an hour later than usual this evening to accommodate all who desired to withdraw their money. The flurry subsided, however. President Beard says he is ready to meet any demands that the depositors may make upon him.
The failure of the First National was the topic of conversation in Vancouver today, and business was practically suspended while the people gathered on Main street and discussed it. The only happy man was Scott Swetland, the well-known politician. He formerly had stock in the bank, but sold it as a result of a quarrel with Canby. Swetland expressed opened and unalloyed joy that the bank had failed.
Chatfield Knight reported tonight that he found a bicycle and umbrella this afternoon in a grove north of town. This proved to be the property of the missing bank officials, the wheel belonging to Brown and the umbrella to Canby. Another report says that the men were seen in Fruit Valley, three miles north of town, late last evening. From this it is believed they went into the direction of Kalama and took the train at that place last night or this morning.