Insurance Investigation Disclosures
LIKE the inquiry which was started some years ago by General Miles’s charge that the army was being supplied with “embalmed beef” by the meat packing companies, which led to startling disclosures of deceptions practised upon the public by meat dealers in general, the inquiry which the Equitable disclosures have set going into the insurance business in this country is showing that that company is by no means the only one whose practises entitle it to a discreditable notoriety. An inquiry into the affairs of the New York Life Insurance Company, conducted by the State superintendent of insurance, September 12, furnished sensational material for the newspapers of the following day. The Washington Post devotes a column and over to the testimony produced, under the heading “Deception in Deal; New York Life’s $800,000 Sale and Purchase; Securities Sold One Day were Bought Back the Next but One. Startling Disclosures Wrung from Treasurer Randolph before Executive Investigating Committee,” etc. The following from the New York Sun of September 9 gives testimony relating to the same company:— The third meeting of the Armstrong insurance committee brought to light the fact that the New York Life Insurance Company has at various times transferred blocks of securities, aggregating several millions of dollars, to the New York Security and Trust Company, now known as the New York Trust Company, to enable it to conceal the ownership of these stocks in its annual schedule of assets. The transaction took the form on the trust company’s books of a loan to the New York Life Insurance Company, the loan being secured by notes drawn by employees in the New York Life with the stock as collateral security. One of the employees, who drew a note running to the trust company, was a messenger who received a salary of $600 a year. His note was for $1,500,000, and was accepted by the trust company. All this and much more of the same kind that is filling the columns of the papers must be interesting reading to those whose money is invested in these enterprises.