of property I am perfectly willing to submit them to the severest
test in respect to valuation from the first to last. Now, we have
a fiece of property which has entered into this discussion, 330 West
Eighteenth Street. The rate per cent. — the net rents now are
reading 13^ per cent. A little piece in Owensboro, Kentucky,
which is scarcely worth mentioning, only valued at four thousand
dollars, 6 per cent.; 80 and 82 Wooster Street, 77/8 per cent.;
530 to 538 Broadway, inclusive, 2 13/16 per cent. ; The Provi-
dent Building, Waco, 4 3/4 per cent.

Q. Do you own that now? A. We do.

Q. When did you get it back, you sold it in the early part of
the year? A. No, we took it back.

Q. I knew that, but I thought you had disposed of it again?
A. No, sir, we have made no further effort to do so, because as
a local investment I think it is a good one for the company, hav-
^g large business down there. The property in 112th Street,
book value $77400, is paying us 8J per cent.

Q. Is that net? A. That is net, Mr. Hughes. On the net rent.
Comer of io6th Street and Amsterdam Avenue, 6 1/8 per cent. ;
and East Seventeenth Street, 7 5/8 per cent.— or a total of 4 3/4



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Testimony 4if Edward W. S,coit

per cent net Then we com& to 35 Nassau Street, which has been
mentioned.

Q. By the Metropolitan? A. That is a transaction cA which
I am personally proud. It gave us an opportunity to concentrate
our holdings scattered in there. Of course we aU know what
that property is. That property will «tand on dts merits, and
there is no getting away or beyond its true vahie. To illustrate,
to-day we have not a vacancy in that building, not one, and we
are {getting two dollars and a half a square foot.

Q. What are your net returns? A. With the expiration of two
leases in May, I think it is Jiext, it will be 5| per cent.

Q. What is it now? A. WjoU, a fraction lower disui that. Fcff
instance, there is one lease, $4,800, we have ibeen offeiied $AQjOeo
on renewal. Another at .$36^000, and we haye been lOfibred $i&-
000, and I *waiit $60^000.

•Q. Are you insured in the Provident? A. I am, sir.

Q. Have you received any oonimissions ii^pon this insuranoe?
A. I did.

'Q. From whom ? A. I tdmric f rem Ane jE>f the agents.

>Q. When were yeHi insnved, and m ^wliat .amouiit ? A. .Seme
years ago.

Q. I what amount? A. $25,000, 1 think.

Q. Is that the total amount of insurance you have? A. In
the company?

Q. Yes. A. Yes, sir.

•Q. What commissions did you receive, or do you receive? A.
I think it was 60 per cent. I recefcwd mo renewart.

Q. Are you insured in other companies? A. That is a non-
participating policy.

Q. Are you insured in other companies? A. I am.

Q. Have you received commissions upon policies in other com-
panies ? A. I do -not recall any because .the .bulk of my insurance
I have had for a good many years.



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Testimony of Ralph K. Hubbard

Q. How many year»? A. It wiH average fifteen, perhaps.
Q. Have you received any commissions upon any in other com-
panies? A. Not that I recall, no, sir.

RALPH K. HUBBARD, resumed.

BY MR. HUGHES:

Q. I call your attention to a loan of January and, 1900, of
♦16,075 ^o Stewart Brown on 67 shares of North American
Trust Company stock as collateral. Do you remember the maik-
ing of that loan? A. I did not make the loan; I was appointed
comptrolkr in Jamiary, 1901, but I was familiar with the trans-
action.

Q. That is all I want, if you are familiar with it. You are not
in any way responsible you mean ? A. Not at all, sir.

Q. What was the transaction? A. The transaction was that
the acquiring of that 62 shares of stock, and the company taking
credit for it, was an entire mistake in bookkeeping and should
not have appeared in our holdings as 62 shares.

Q. What was that? A. Repeat your question.

Q. I think you have said the acquiring of the 62 shares and
taking credit for it as a holding was an entire mistake ? A. Yes,
sir.

Q. Why was it a mistake — ^mistake of bookkeeping — why was
it a mistake? A. Just a plain unintentional bookkeeping mis-
take.

Q. What was the error? Did you make a loan to Stewart
Brown on January 2nd, 1900, of $16,000 upon that collateral?
A. We did.

Q. Now, at the close of the year on September 28th, 1900, it
appears from your record of purchases that you bought 67



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Testimony of Ralph K. Hubbard

shares from W. H. Taylor, Vice President — ^was he Vice Pres-
ident of your company ? A. No, sir.

Q. Of what company was he Vice President? A. I presume
of the North American Trust Company.

Q. Sixty-seven shares — ^were those the 67 shares? A. Yes,
continued right along.

Q. Those are the same 67 shares you held as collateral for
the loan? A. Oh, no, sir.

Q. What do you mean when you say there was some mis-
take made — ^what was the mistake? A. I was answering the
question that I thought you put to Mr. Scott — ^that 62 shares
of stock.

Q. You are referring now not to the 67 but to the 62? A.
The 62.

Q. Now, let us get the 67 straight first, then we will go to the
62. The 67 shares were held as collateral for a loan made to
Stewart Brown made January 2nd, 1900? A. Yes.

Q. What became of that transaction, that 67 shares? A. It
was paid off, the loan was paid off.

Q. When was it paid? A. December, 1900.

Q. Was it made again? A. It was made again the following
year.

Q. It was paid off at the end of the year 1900? A. And re-
made in January or February.

Q. The collateral surrendered and payment back? A. The
collateral was not surrendered. That accounts for the mistake.

Q. You held the collateral and cancelled the loan? A. Yes.

Q. What was the object of that? A. It was not an object, Mr.
Hughes.

Q. Simply a mistake? A. Simply a mistake.

Q. Well,, on December 31st, 1900, it appears from your pur-
chases that you bought from Stewart Brown 62 shares of North



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Testimony of Ralph K. Hubbard

American Trust Company. Was that 62 a part — ^that was part
of the 67 ? A. Yes, sir.

Q. That had been collateral? A. Yes, sir.

Q. Did you make any such purchase ? A. No, sir.

Q. Did you pay Mr. Brown any such amount? A. No, sin

Q. It appeared in the annual report of the company for that
year? A. Yes, sir.

Q. As among the securities owned? A. Yes, sir, which was
a mistake.

Q. How could such a mistake arise? A. The office was in
utter confusion, Mr. Hughes, in the end of December, 1900,
and there was not the same care and attention paid to the prep-
aration of the 1900 statement as there should have been.

Q. Were there other mistakes in it? A. There was, but of
no particular moment.

Q. What were the others? A. Well, I could not say oflFhand.
I have not certified the statement, but I may say that Mr. Wright
— ^Walter C. Wright — went over that statement.

Q. Go on. A. Walter C. Wright went over that statement
and verified the same with the exception of the mistakes that
I have referred to.

Q. When did he go over it? A. In the examination of the
company in the middle of 1901.

Q. Then the fact is at the end of 1900 the companies did not
own 129 shares of North American Company stock? A. That
is the fact.

Q. As stated in the report? A. Yes, sir.

Q. It did not own any shares? A. Yes.

Q. What did it own? A. 67.

Q. How did it acquire the. 67? A. Purchased several years
ago; I could not give you the dates of it — before that — several
years — ^perhaps in 1899.



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Testimony of Miles M, Dazvson

Q. Well, that is the 67 that had been bought in 1900 from
Mr. Taylor? A. That is it.

Q. They owned that ? A. Yes, sir.

Q. But they did not own the other 62 that niade up the 129?
A. That is right.

Q. Now, at the beginning of 1901 the loan to Mr. Stewart
appears upon 67 shares of North American Trust Company
stock as collateral was renewed, and it appears that on Decem-
ber 31, 1901, there was a purchase from Mr. Brown of 67 shares.
Did that take place ? A. That actually took place.

Q. That took place? A. That is correct.

Q. So that when in the end of the next year you reported you
owned 134 shares of North American Trust Company that is
correct ? A. That is correct.

Q. And were the other 67 share* that were purchased at the
end cf 1901 the same that had been collateral for his loan? A.
Yes, sir.

Q. They were purchased by the cancellation of his loan and
tdking the stock in payment? A. Yes, sir.



MILES M. DAWSON, called as witness, being duly sworn,
testified as follows:



BY MR. HUGHES:

Q. Mr. Dawson, have you taken the annual report of the
Provident Savings Life Assurance Society and compiled certain
statements from them as to the profits made upon their real
estate transactions and upon their real estate securities of the
results of their business apart from such profits? A. I have.

Q. Are these the statements (showing witness papers)? A.
They are.



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Testimony of Miles M, Dawson

Q. You believe them to be correct from the reports? A. I do.

Q. They are simply compilations of what appear in the sworn
reports of the company to the Insurance Department ? A. They
are.

MR. HUGHES: I offer them in evidence.
(Papers marked Exhibit 729.)

Q. Just explain what those papers show? A. They show to
begin with profit and loss, items including changes in the mar-
ket values as per statements to the New York Department.
Shall I read what the changes are ?

Q. If you will take one year as an illustration of the method in
which you have arrived at the results; then give the results for
the years. A. 1897 the profits were:

Agency accounts $101.34

Natatorium stock 2,000.00

Waco real estate 56,527.97

Savannah real estate 18,436.24

Sales of securities 5,164,42

Making total profits of $82,229.97

Losses, agency account 68.83

Collateral loans (Hadley) 60,000.00

Total losses $60,068.83

■^et profits $22,161.14

^^^at is net profit on the real estate and securities? A.

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Testimony of Miles M. Dawson

The net profit, that is in the profit and loss account, as given
on the statement.

Q. Now, take the profit made — ^the amount indicated by the
profit and loss statement of succeeding years? A. Yes.

Q. And the losses as indicated by the same statement. You
find in 1898 a net profit of $5,636.55. A. Whatever it is there.

Q. In 1899 $63,176.03

In 1900 52,001.89

In 1901 183,998.38

In 1902 199,891.81

In 1903 79>579-55

In 1904 229,107.78

Your next statement is a statement of Gains on Real Estate,
as shown by the reports? A. For the various years.

Q. For the various years, the first being gross gains as fol-
lows:

1897 $74,96421

1898 26,296.92

1899 46,444.87

1900 21,280.76

1901 188,535.64

1902 224,287.65

1903 91,031.68

1904 254,233.27

From 1902, the gains on securities and real estate are together
and the figures that you have given stand for both? A. They
are.



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Testimony of Miles M, Dawson

Q. Then you have in your next detailed gains as shown by
the report of the company on real estate and securities, net?
A. That means with those losses deductedf

Q. With the losses deducted. The statement you have just
given is gross, without deducting losses ? A. Yes.

Q. These net are the same footings that I have given in the
first statement ? A. You have already read.

Q. Then you have in the next title the Remainder of Surplus
Interest, etc., in Gain and Loss Exhibit, furnished by the com-
pany, marked Exhibit No. 70? A. Correct.

Q. Attributable to interest and rent after deducting net gains,
real estate and securities, by sales and mark-ups.



1897. Total under the head of surplus interest, etc.,

in the report is $84,800

And deduction for gains and real estate se-
curities, by sales and mark-ups 22,161.00

Leaving a remainder of $62,639.00



1898 Total $82,539.00

Deduction 5,637.00

Remainder $76,902.00



1899 Total $89,928.00

Deduction 63,176.00

Remainder $26,752.00

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Testimony of Miles M. Dawson

1900 Total $70465.00

Deduction 52,002.00

Remainder $18463.00

1901 Total $104,668.00

Deduction 183,998.00

Remainder, a minus quantity $79»330.oo

1902 Total $77»72Sa>

Deduction 199,892.00

Remainder, a minus quantity $122,167.00

1903 Total $101,375.00

Deduction 79,580.00

Remainder $21,595.00

1904 Total $357792.00

Deduction 229,108.00

Remainder $128,684.00

Your concluding statement is the total of the net profits for
the year as per the gain and loss exhibit, to-wit : Exhibit No.
709, making the gains exclusive of sales and mark-ups of real
estate values of securities, in other words, what the insurance
gains would be apart from such enhancements? A. Yes.

Q. As follows:



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Testimony of Miles M. Dawson

1897 As stated in Exhibit 709, net profits $21,395.00

Gains, as started 22,161.00

Remainder, minus $766.00

1898 Net profits $408,905.00

Gains, as stated 5,637.00

Remainder $403,268.00

1899 Net profits $96,628.00

Gains from real estate 63,176.00

Remainder > $33,452.00

1900 Net profits $132,098.00

Gains from real estate 52,002.00

Remainder $80,096.00

1901 Net profits $222,990.00

Gains from real estate 183,998.00

Remainder $38,992.00

1902 Net profits $318,743.00

Gains from real estate 199,892.00

Remainder $118,851.00

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Testimony of Miles M. Dawson

1903 Net profits $227,670.00

Gains from real estate 79,580.00

Remainder $148,090.00

1904 Net profits $116,567.00

Gains from real estate, etc 229,108.00

Remaining, a negative quantity $112,541.00

Your statements will appear in full in the record.

The statements heretofore summarized by Mr. Hughes to be
found in the Book of Exhibits, as Exhibit No. 729.

The following papers are marked for identification :

Bank balances October 31st, 1900 to October 31, 1905, Prov-
ident Savings Life Insurance Company.

(Marked Exhibit 730 for identification.)

Record of purchases and securities for ten yiears preceding
November 21, 1905. (Marked Exhibit 731 for identification.)

Record of sales of securities same period.

(Marked Exhibit 732 for identification.)

Securities November 21, 1905.

(Marked Exhibit 733 for identification.)

Record of collateral loans October 31st.

(Marked Exhibit 734 for identification.)

Adjourned to 2:30 this afternoon.



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AFTER RECESS.

^- HUGHES: Will you call Mr. Stacey Wilson?

THE CHAIRMAN: Is Mr. Stacey Wilson in the room?
He does not appear to answer, Mr. Hughes. Is there any
other witness?

MR. HUGHES: Not at present.

STACEY WILSON, called as a witness, being duly sworn,
testified as follows:

BY MR. HUGHES:

Q. Where do you reside? A. Brooklyn.

Q. How long have you been connected with the Empire
Life Insurance Companj'^? A. In different positions since
about 1883.

Q. When was the Empire Life Insurance Company organ-
ized? A. In 1881.

Q. Under the same name? A. No, the Home Benefit So-
ciety.

Q. How long did it do business under the name of the Home
Benefit Society? A. Until 1894.

Q. What was che character of the business of the Home
Benefit Society? A. An assessment life insurance, sick and
accident insurance.



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Testimony of Stacey Wilson

Q. Exclusively an assessment company? A. Yes, sir.

Q. Without capital stock? A. Without capital stock, yes,
sir.

Q. Is this a copy of the constitution and by-laws of the Em-
pire Life Insurance Company (handing paper) ? A. Yes, sir.

MR. HUGHES: I offer it in evidence.

(Paper marked Exhibit 735.)

(Exhibit. 735 will be found in the book of exhibits.)

Q. What led to the reorganization under the name of the
Empire Life? A. Well, so many companies that had similar
names to the Home Benefit Society went out of existence.

Q. What was done with the insurance in force at the time
of the organization under the name of the Empire Life? A.
It simply was carried on. We simply had a rider printed
which we attached to the old policies.

Q. Was there a re-incorporation? A. No, simply a change
of name.

Q. Simply a change of name? A. Yes, sir.

Q. Your company is now under Article VI of the Insurance
Laws as an assessment corporation? A. Yes, sir.

Q. And as the Empire Life it has no capital stock? A. No,
sir.

Q. Who are the officers of your company? A. Well, Evelyn
L. Bissell was the president.

Q. Who is president now? A. We have not elected one. Dr.
Bissell died four or five days ago.

Q. Who is vice-president ? A. A. Judson Stone.

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Testimony of Stacey Wilson

Q. How long has he been vice-president? A. Since 1893, I
think.

Q. Who is secretary? A. I am the secretary.

Q. And you as secretary actively managed the company? A.
Yes.

Q. Who is the treasurer? A. George D. Godwird.

Q. How long has he been treasurer? A. He has been treas-
urer since the organization of the company.

Q. What other employes have you ? A. A bookkeeper, clerk,
stenographer and cashier.

Q. Any other employes ? A. No, sir.

Q. How many clerks have you? A. What I stated, that in-
cludes all the clerks.

Q. One clerk? A. We have but one clerk, one bookkeeper
and a cashier and stenographer.

Q. What property do you own? A. We don't own any prop-
erty, sir, only — ^that is, no real property. We own $5,000 water
bonds.

Q. You own $5,000 water bonds of New York City? A. Yes,
sir.

Q. Has your company any other assets than those bonds?
A. No, sir.

Q. Have you any cash? A. Well, some.

Q. What amount of cash have you? A. Well, less than
$5,000.

Q. How much less? A. Probably about $2,000 less.

Q. Where is it kept ? A. It is kept in the Nassau Bank and
the banking house of Edgar Tripp & Company in Trinidad.

Q. Where? A. In Trinidad.

Q. How do happen to have a bank account in Trinidad ? A.
Well, he collects premiums there on business that we transferred
from another company some years ago, and he holds that money
until we call for it at certain times of the year.



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Testimony of Stacey Wilson

Q. What company was this? A. The National Mutual.

Q. Where did it do business? A. New York City.

Q. How does it happen that the man in Trinidad has any-
thing to do with it? A. Well, they happened to write quite a
little business in Trinidad and around that section.

Q. Where was that company chartered? A. In New York.

Q. When was it chartered ? A. I could not tell you when, but
I would assume it was chartered in the neighborhood of 1885
or 1886.

Q. When did your company take over its business? A. 1894.

Q. What was the amount of business you took over? A.
Probably about two millions of business.

Q. About two millions of outstanding insurance? A. Yes.

Q. Who is the man who handles that in Trinidad? A. Ed-
gar Tripp & Company.

Q. What proportion of the two million was business in Trin-
idad? A. A very small proportion, probably — ^well, there might
have been $25,000, or maybe $30,000 worth of business there.

Q. What amounts do you receive from Tripp & Company
from time to time, how do they average? A. Probably about
every year or a year and a half he sends us $1,000 or $1,500, as
the case may be.

Q. Have you any other bank account in New York than the
one with the Nassau Bank? A. No, sir.

Q. What is your average balance with that bank? A. Well,
it varies. Sometimes we have three or four thousand dollars
and sometimes we don't have more than three or four hundred
dollars.

Q. What have you now? A. Probably about seven or eight
hundred dollars.

Q. Then seven or eight hundred dollars in the Nassau Bank
and the $5,000 water bond of New York City constitute your en-



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Testimony of Stacey Wilson

tire assets ? A. Yes, or probably the cash on hand or something
of that kind.

Q. How much would that be? A. Probably three or four
hundred dollars more.

Q. At the end of 1904 how much property did you own, your
company, of course, I mean? A. At the end of 1904?

Q. Yes. A. We probably had in the neighborhood — I cannot
tell you exactly without looking, in the neighborhood of eleven
thousand or twelve thousand dollars.

Q. Of which five thousand dollars was this water bond and the
rest were cash balances? A. Cash in different banks at that
time.

Q. What are your outstanding liabilities? A. In the neigh-
borhood of — ^well, roughly, about fifty thousand dollars.

Q. What do they consist of? A. Claims.

Q. Death claims? A. Yes, sir.

Q. Approved as not paid? A. And that are being contested.

Q. What proportion of the fifty thousand dollars consists of
contested claims? A. Probably about one-third.

Q. And thirty-three thousand dollars consists of claims un-
contested, which have been existing for how long? A. Some a
short time, and some a long time. When I say a long time, I
mean within a reasonable time.

Q. How long is the longest time that you have permitted a
death daim to exist without payment, uncontested? A. From
the time of its approval, not more than ninety days.

Q. What was the amount of your outstanding liabilities on
December 31st, 1904? A. I think about forty-five thousand dol-
lars.

Q. Against which you had ten thousand dollars of assets ? A.
Yes, sir.

Q. Now, you have about fifty thousand dollars, with about
six thousand dollars of assets. Is there any test of solvency of



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Testimony of Stacey Wilson

, an, assessment company? A. Well, we have — our calls come in
on the first of the month. Generally on the first of the month
we have a little more money come in to meet these obligations.

Q. Under the law of the State you are not required to keep
any reserve? A. Only a reserve, emergency, equal to the
amount of one assessment, one mortuary call.

Q. What was the amount of one mortuary call. A. About
seven thousand dollars.

Q. Then you have not a reserve at the present time to that
amount? A. Yes, sir.

Q. Where is it? A. That we have got, counting what we have
got in the five thousand dollar bonds and the cash on hand and
the money that is in the banks. We have got enough to cover
that.

Q. You have got five thousand dollars and the three or four

hundred dollars cash and a few hundred in bank A. Seven

or eight hundred dollars, probably, in the bank.

Q. How much in the bank? A. Seven or eight hundred dol-
lars, I think, in that neighborhood, maybe a little less.

Q. That would make a total of less than seven thousand dol-
lars. A. Then we have about fifteen hundred dollars coming
from Tripp.

Q. You can call on that? A. Yes.

Q. When will you be likely to get it ? A. About the first of
the year.

Q. What is the amount of your outstanding insurance? A.
About four millions of business.

Q. Four millions of dollars? A. Yes.

Q. How many policies have you outstanding? A. Probably
twenty-two hundred, from two thousand to twenty-two hundred.

Q. Where do you do business, in what jurisdictions. A. New
York, Pennsylvania.

Q. What other jurisdictions? A. And West Virginia.



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Testimony of Stacey Wilson

Q. Those are the only ones? A. Yes.

Q. What proportion of your business is in- the State of New-
York? A. Most of it.

Q. That means seventy-five per cent. ? A. Yes, ?ir.

Q. You have no president at present ? A. No, unfortunately
he died about four days ago. I went to his funeral last Tuesday.

Q. Prior to his death did he have a salary? A. No.

Q. Did your vice-president have a salary? A. No.

Q. What is your salary? A. Twenty-five hundred dollars.

Q. What is the treasurer's salary? A. Two thousand dollars.

Q. What is the clerk^s salary? A. One gets about twenty
dollars a week, and the other gets eighteen dollars a week.

Q. What is the bookkeeper's salary ? A. Eighteen dollars.

Q. And the cashier's salary ? A. Eight dollars.

Q. And the stenographer's? A. Eight dollars.

Q. That is a week? A. Yes, sir.

Q. And that is your entire payroll? A. Yes, sir.

Q. Where are your offices ? A. 206 Broadway.

Q. What rent do you pay? A. Seventeen hundred dollars a
year.

Q. What were your total receipts in 1904? A. I think a little
less than ninety thousand dollars.

Q. Is it seventy-eight thousand dollars ? A. Yes, that is right.
I was counting the ten thousand dollars or eleven thousand be-
side.

Q. $78,335 were your entire receipts in 1904? A. Yes, sir.