_ The suspension of the banking house of Frank A. Cowperwood & Co.
created a great stir on 'change and in Philadelphia generally. It
was so unexpected, and the amount involved was comparatively so
large. Actually he failed for one million two hundred and fifty
thousand dollars; and his assets, under the depressed condition of
stock values, barely totaled seven hundred and fifty thousand
dollars. There had been considerable work done on the matter of
his balance-sheet before it was finally given to the public; but
when it was, stocks dropped an additional three points generally,
and the papers the next day devoted notable headlines to it.
Cowperwood had no idea of failing permanently; he merely wished
to suspend temporarily, and later, if possible, to persuade his
creditors to allow him to resume. There were only two things which
stood in the way of this: the matter of the five hundred thousand
dollars borrowed from the city treasury at a ridiculously low rate
of interest, which showed plainer than words what had been going
on, and the other, the matter of the sixty-thousand-dollar check.
His financial wit had told him there were ways to assign his
holdings in favor of his largest creditors, which would tend to
help him later to resume; and he had been swift to act. Indeed,
Harper Steger had drawn up documents which named Jay Cooke & Co.,
Edward Clark & Co., Drexel & Co., and others as preferred. He
knew that even though dissatisfied holders of smaller shares in
his company brought suit and compelled readjustment or bankruptcy
later, the intention shown to prefer some of his most influential
aids was important. They would like it, and might help him later
when all this was over. Besides, suits in plenty are an excellent
way of tiding over a crisis of this kind until stocks and common
sense are restored, and he was for many suits. Harper Steger
smiled once rather grimly, even in the whirl of the financial
chaos where smiles were few, as they were figuring it out.
"Frank," he said, "you're a wonder. You'll have a network of
suits spread here shortly, which no one can break through. They'll
all be suing each other."
Cowperwood smiled.
"I only want a little time, that's all," he replied. Nevertheless,
for the first time in his life he was a little depressed; for now
this business, to which he had devoted years of active work and
thought, was ended.
The thing that was troubling him most in all of this was not the
five hundred thousand dollars which was owing the city treasury,
and which he knew would stir political and social life to the center
once it was generally known--that was a legal or semi-legal
transaction, at least--but rather the matter of the sixty thousand
dollars' worth of unrestored city loan certificates which he had
not been able to replace in the sinking-fund and could not now
even though the necessary money should fall from heaven. The fact
of their absence was a matter of source. He pondered over the
situation a good deal. The thing to do, he thought, if he went to
Mollenhauer or Simpson, or both (he had never met either of them,
but in view of Butler's desertion they were his only recourse),
was to say that, although he could not at present return the five
hundred thousand dollars, if no action were taken against him now,
which would prevent his resuming his business on a normal scale a
little later, he would pledge his word that every dollar of the
involved five hundred thousand dollars would eventually be returned
to the treasury. If they refused, and injury was done him, he
proposed to let them wait until he was "good and ready," which in
all probability would be never. But, really, it was not quite
clear how action against him was to be prevented--even by them.
The money was down on his books as owing the city treasury, and
it was down on the city treasury's books as owing from him. Besides,
there was a local organization known as the Citizens' Municipal
Reform Association which occasionally conducted investigations in
connection with public affairs. His defalcation would be sure to
come to the ears of this body and a public investigation might
well follow. Various private individuals knew of it already. His
creditors, for instance, who were now examining his books.
This matter of seeing Mollenhauer or Simpson, or both, was important,
anyhow, he thought; but before doing so he decided to talk it all
over with Harper Steger. So several days after he had closed his
doors, he sent for Steger and told him all about the transaction,
except that he did not make it clear that he had not intended to
put the certificates in the sinking-fund unless he survived quite
comfortably.
Harper Steger was a tall, thin, graceful, rather elegant man, of
gentle voice and perfect manners, who walked always as though he
were a cat, and a dog were prowling somewhere in the offing. He
had a longish, thin face of a type that is rather attractive to
women. His eyes were blue, his hair brown, with a suggestion of
sandy red in it. He had a steady, inscrutable gaze which sometimes
came to you over a thin, delicate hand, which he laid meditatively
over his mouth. He was cruel to the limit of the word, not
aggressively but indifferently; for he had no faith in anything.
He was not poor. He had not even been born poor. He was just
innately subtle, with the rather constructive thought, which was
about the only thing that compelled him to work, that he ought to
be richer than he was--more conspicuous. Cowperwood was an excellent
avenue toward legal prosperity. Besides, he was a fascinating
customer. Of all his clients, Steger admired Cowperwood most.
"Let them proceed against you," he said on this occasion, his
brilliant legal mind taking in all the phases of the situation at
once. "I don't see that there is anything more here than a
technical charge. If it ever came to anything like that, which I
don't think it will, the charge would be embezzlement or perhaps
larceny as bailee. In this instance, you were the bailee. And the
only way out of that would be to swear that you had received the
check with Stener's knowledge and consent. Then it would only be
a technical charge of irresponsibility on your part, as I see it,
and I don't believe any jury would convict you on the evidence of
how this relationship was conducted. Still, it might; you never
can tell what a jury is going to do. All this would have to come
out at a trial, however. The whole thing, it seems to me, would
depend on which of you two--yourself or Stener--the jury would be
inclined to believe, and on how anxious this city crowd is to find
a scapegoat for Stener. This coming election is the rub. If this
panic had come at any other time--"
Cowperwood waved for silence. He knew all about that. "It all
depends on what the politicians decide to do. I'm doubtful. The
situation is too complicated. It can't be hushed up." They were
in his private office at his house. "What will be will be," he
added.
"What would that mean, Harper, legally, if I were tried on a charge
of larceny as bailee, as you put it, and convicted? How many years
in the penitentiary at the outside?"
Steger thought a minute, rubbing his chin with his hand. "Let me
see," he said, "that is a serious question, isn't it? The law says
one to five years at the outside; but the sentences usually average
from one to three years in embezzlement cases. Of course, in this
case--"
"I know all about that," interrupted Cowperwood, irritably. "My
case isn't any different from the others, and you know it.
Embezzlement is embezzlement if the politicians want to have it
so." He fell to thinking, and Steger got up and strolled about
leisurely. He was thinking also.
"And would I have to go to jail at any time during the proceedings--
before a final adjustment of the case by the higher courts?"
Cowperwood added, directly, grimly, after a time.
"Yes, there is one point in all legal procedure of the kind,"
replied Steger, cautiously, now rubbing his ear and trying to put
the matter as delicately as possible. "You can avoid jail sentences
all through the earlier parts of a case like this; but if you are
once tried and convicted it's pretty hard to do anything--as a
matter of fact, it becomes absolutely necessary then to go to jail
for a few days, five or so, pending the motion for a new trial and
the obtaining of a certificate of reasonable doubt. It usually
takes that long."
The young banker sat there staring out of the window, and Steger
observed, "It is a bit complicated, isn't it?"
"Well, I should say so," returned Frank, and he added to himself:
"Jail! Five days in prison!" That would be a terrific slap, all
things considered. Five days in jail pending the obtaining of a
certificate of reasonable doubt, if one could be obtained! He must
avoid this! Jail! The penitentiary! His commercial reputation
would never survive that. _