A Dead Defaulter
The Drowned President of the Brooklyn Trust Company a Defaulter — An Investigation Reveals a Sad State of Affairs
The president of the Brooklyn Trust Company, who drowned days earlier at Coney Island, is revealed to have looted the bank of hundreds of thousands of dollars, prompting suspicion his death was suicide rather than accident.
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The Cairo Bulletin · July 20, 1873 · Page 1
2 min readNEW YORK, July 19.
This morning the Brooklyn Trust company, of which Chelbert S. Mills, who was drowned Tuesday at Coney Island, was president, suspended payment. It was discovered that Mills had overdrawn his accounts $150,000. It is said that the account of Thomas H. Kidman, secretary, is short $31,000. For the latter amount the company hold collateral, but whether they are good or not remains to be determined.
The defalcation was not definitely ascertained till yesterday, when it was brought to light by investigation instituted by the directors. Not only did they find that Mills had overdrawn his personal account, but also discovered that he had taken worthless securities for the sum of $303,000, so altogether there was an inroad of $150,000 made on the capital stock of the company.
The securities in question are from the state of Georgia, and the New Haven, Middletown, and Wilmington Railroad company. To the former Mills had loaned $110,000; to the latter $20,000 in Bullock's bonds, which it is claimed were illegally issued, and the interest on which the present authorities decline to pay. Whether the railroad bonds will ever become worth much is a question.
In the meantime the simple facts are, while the capital stock is $500,000 there are $300,000 in unavailable bonds. The deposits on hand last evening were about $1,300,000, of which about $130,000 belonged to the city, $84,000 to the county, and $100,000 to Mr. Sullman of the firm of Rainey, Butler and Parsons of this city. Sullman represents as a depositor several trusts, among them the funds of one or two collapsed insurance companies, of which he was receiver.
Eight directors made a statement to the public, that they believed it entirely possible for the company to continue business in a few days, and that depositors will lose nothing. Daniel Chancy has been appointed receiver.
The Union says recent developments in regard to the affairs of the bank, in many persons who first believed Mills met an accidental death, are inclined to the opinion he committed suicide rather than face the exposure which he knew was inevitable.
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