The Bank President’s Private Till: Walla Walla’s Savings Bank Scandal

WALLA WALLA, Aug. 25.—[Special.]—The report of Expert Branch, who was employed to examine the books and accounts of the defunct Walla Walla Savings Bank, was made public this morning. The report was made to the stockholders who engaged Branch to do the work, and is very lengthy. After blaming the directors of the bank for having failed to carry out the provisions of the articles of incorporation, by reason of failing to hold meetings and failure to examine the report on the condition of the bank each quarter, Expert Branch proceeds at length to review the actions of J. K. Edmiston, president of the bank. Among other things he says: Edmiston had a habit of using the bank's money to dispose of claims which he held for his personal charges for commission or interest, and the bank is now holding such paper as part of its assets, Edmiston having realized cash for such claims. This has been going on for the greater part of the five years of the bank's existence, but more largely in the last six months prior to the suspension of the bank. He then cites several instances where the money of the bank had been appropriated by Edmiston for his private use, and the books “fixed” to cover the appropriation. Another instance of fraud shown is that George L. Fitzhugh, formerly manager of the bank, and Leon Phipps, an employee of the bank, had been allowed to borrow over $4,000 and $5,000, respectively, without giving any security beyond their personal notes. The expert states that there will be over $151,000 of notes held by the bank which are worthless, and accounts amounting to over $9,000 in the same condition, not taking into account the notes of Edmiston to the bank for $10,000 and his overdraft of $6,000.