The Bank Wrecker’s Failed Empire
After swindling depositors to fund a coast-wide banking trust, H. St. John Dix faces ten years in the penitentiary.
The story, cleaned up
A cleaned-up reading of the newspaper page: spelling and layout repaired, one story lifted off a crowded page. It follows the original closely but it is not a transcription. The original page is below; read it if a detail matters.
The famous case of H. St. John Dix, the Whatcom bank wrecker, has been affirmed by the supreme court and Dix will be required to serve a term of ten years in the penitentiary. The particular crime charged against Dix was the embezzlement of the funds of the Scandinavian-American Bank of Whatcom, of which he was president. Prior to his connection with the bank, Dix was a solicitor for a Seattle paper. He had no money, but was possessed of a large amount of nerve and a plausible tongue. He succeeded in borrowing enough money to purchase the controlling interest of the Scandinavian-American Bank and then repaid the borrowed money from the funds of the bank. His plan was to start a chain of banks by using the funds of each bank purchased to buy out another bank, until he had formed a trust of the banks on the Pacific coast. Before his chain of banks was fully started, however, Dix's personal expenses began to eat up the deposits. He obtained $22,790 from the bank in all, and anticipating the crash, left for England. The bank shortly thereafter closed its doors with $130 cash on hand. Dix was finally apprehended in London, extradited, convicted, and sentenced to ten years.
“He had no money, but was possessed of a large amount of nerve and a plausible tongue.”
Dix's attempt to use one bank's capital to buy another in a speculative chain is a classic example of early 20th-century financial 'pyramiding,' a practice that periodically resurfaces in modern corporate scandals. His rise from newspaper solicitor to bank president through sheer 'nerve' reflects a volatile era of banking deregulation in the Pacific Northwest.
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