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- THE LINCOLN STAR - APRIL 17, 1930
THIRD BANK IN WAHOO CLOSES
RUN CAUSES CITIZENS STATE TO SUPSPEND OPERATION
Largely because of the psychological effect of two other bank failures in the same town and four in neighboring towns of Saunders county, the Citizen's State bank of Wahoo found it necessary to suspend business Thursday morning. When it fad to open its doors the institution was taken over by the state banking bureau, which had been notified, and Examiner L. C. Sorensen assumed charge of it.
Heavy withdrawals followed the closing of the six Kirchman banks earlier in the week are assigned by Cashier Emil Benson of the Citizen's State as the cause of its inability to continue business. About $50,000 was pulled out by depositors onnesday, he declared.
Mr. Benson thought the bank's affairs are in such shape that it will pay depositors a good percentage of their claims. He would venture no prediction as the whether its reorganization will be attempted.
The Citizens' State was organized thirty-five years ago. Mr. Benson, who has been connected with it for 18 years, was actively in charge as cashier for several years past. He is also vice president. J. M. Ohslund has been its president for at 12 years. The assistant cashier was Adolph Kucera.
Deposits on March 31, the date of the bank's last published statement, stood at $403, 986, but this amount had been greatly reduced by withdrawals since.
State Bank Commissioner Woods declined to make any statement regarding plans for reorganizing any of the seven banks closed in Saunders county this week.
Thursday's failure leaves Wahoo, one of the principal; county seat towns in eastern Nebraska, without a single state bank. It has one national bank.
THE LINCOLN STAR - APRIL 24, 1930
NOTES EXCHANGED BY WAHOO BANKS OFFICIALS CLAIM
Prosecution of two Wahoo bankers, F. J. Kirchman and Emil Benson, the latter of whom is now in the penitentiary after pleading guilty on Wednesday to three criminal counts, and the former is being held for trial in the United States districtrt on fifteen speculations followed a simultaneous examination of all the banks in the Kirchman string last week, which uncovered a system of exchanging notes and credits with the evident purpose of deceiving the examiners.
It was found that Benson, whose bank did not belong to the Kirchman group, had loaned $6,000 of notes from his institution to Kirchman's bank in Wahoo at the time it was undergoing examination. These were returned upon the order of State Bang Commissioner Woods.
Five examiners for the state and one national examiner swooped down at once upon the banks that were subsequently closed. They uncovered a number of items which had apparently been transferred back and forth among the banks, and in some instas entered as credits on the books of two different institutions at the same time.
Mortgages belonging to customers of the Benson bank, it is stated, had been turned into the bank to help it make a good showing for the examiners scrutiny.
Bank Commissioner Woods will hold a series of depositors' meetings in the various towns where the banks were located on Friday and Saturday, to consider their reorganization.
Emil Benson, vice president and cashier of the Citizens State bank of Wahoo which closed last Thursday, began his clerical duties in the factory office at the state penitentiary this morning.
He was brought to the prison Wednesday evening by Sheriff L. D. Mengel and County Attorney C. F. Galloway of Wahoo to begin serving a term of five to ten years.
Benson was sentenced late Wednesday afternoon by District Judge Hastings after he pleaded guilty to three charges of embezzlement.
County Attorney Galloway declared at 2:30 o'clock Wednesday afternoon that no complaint had been drawn against Benson and said that to his knowledge none was contemplated.
THE LINCOLN STAR - APRIL 24, 1930
WAHOO BANKER COMES TO PEN
EMIL BENSON PLEADS GUILTY TO VIOLATING BANKING LAW
F. J. KIRCHMAN GIVES BOND BEFORE FEDERAL COMMISIONER IN OMAHA
OMAHA, April 24 - AP - One Wahoo banker began today a long term in the Nebraska penitentiary at Lincoln and a second faces federal prosecution on a charge of misappropriation of funds as the result of the closing last week of several Saundersunty banks.
Emil Benson, vice president of the Citizens' State bank of Wahoo which closed last Thursday, was taken to Lincoln last night to begin serving from five to ten years term on each of three counts to which he pleaded guilty yesterday in Districturt. The sentences which will run concurrently were accompanied by fines of $1,000 on each count.
KIRCHMAN FREED ON BOND
For 45 years connected with the Saunders County National Bank in which he started as a janitor, F. J. Kirchman, Sr., 64, president of the institution has been arraigned before United States Commissioner Mullen and released on a charge of misaication, after $5,000 bond was filed by one of the depositors in his bank.
Kirchman is charged with having misapplied funds and making false entries in actions involving $48,000. He also owns interests in five of the Saunders county state banks which closed last week.
BENSON PLEADS GUILTY
Benson whose bank was taken over by the state banking department last Thursday admitted before District Judge Hastings at Wahoo yesterday that he had made out three notes totaling $9,100 in favor of the bank, to replace two notes and a mortge which had been placed in the bank for safekeeping. The notes were recorded in the bank books so as to be credited to the banks assets when the state examiner made his visits he said. He has been connected with the bank for about fifteen years.
The mortgage was held by Ed J. Bredenburg, and was for $5,000. One of the notes for $2,500, had been given the bank for safe keeping by Nels Hockinson, and the other for $1,600, carrying the signature of Harry Nigh had been deposited by the Sders County Farm Loan Association.
Judge Hastings has ordered Galloway to make a full investigation of all transactions.
"I made no personal profit whatever from the transactions" Benson said when he pleaded guilty. "It was all done to save the bank."
Benson is married but has no children. He has been with the Citizens State bank ever since its founding about 15 years ago.
Fifteen counts have been listed in the federal complaint against Kirchman. The main charge is that he listed notes on the banks' books as owned by it, when they were actually the property of other banks.
THE LINCOLN STAR - WEDNESDAY, JUNE 24, 1931
To Recall Grand Jury
A two-count indictment was also returned against Emil Benson, former Wahoo banker, charging him with misappropriation of $3,117 belonging to the Saunders County National Farm Loan association. Benson is serving a term in the Nebraska penitenty on bank charges.
THE LINCOLN STAR - THURSDAY, JUNE 25, 1931
Bond for Emil Benson, former official of the Saunders County Nation Farm Loan association, indicted for misappropriation of funds, was set at $2,500. He is at present serving a term in the state penitentiary on bank charges.
LINCOLN STAR - MARCH 16, 1934
LUTHER COLLEGE SUIT SUSTAINED
SUPREME COURT AFFIRMS $10,000 JUDGMENT AGAINST BENSON
A $10,000 judgment obtained by the Luther college of Wahoo in a suit against Emil Benson, former treasurer of the college and his surety was affirmed by the Supreme court Friday. The college brought the action to recover from Benson and his sty, the American Surety company of New York, for sums alleged to have been converted by the treasurer to his own use as cashier and vice president of the Citizens State bank of Wahoo.
The defendants argued that, among other things, Benson's alleged manipulations of college funds deposited in the bank did not constitute embezzlement as defined by the statutes and consequently no liability on his bond was established, but thourt refused to adopt this theory.
"In a fidelity bond insuring an employer against loss sustained by any sort of embezzlement on the part of the employee, the word "embezzlement" is to be construed broadly in its general and popular sense, rather than in a narrow and technicapirit with specific references to the criminal statute of the state," the opinion stated.
The court also held that a bond guaranteeing fidelity of an employee is a form of insurance and subject to the rules applicable to insurance contracts generally, and not to the rules applicable to ordinary sureties for accommodation.
THE LINCOLN STAR - FRIDAY, APRIL 20, 1934
UPHOLD TRUST FUND
In a Saunders county case, the Supreme court sustained a trust fund judgment of $7,050 obtained by Olaf Pearson, administrator of the estate of John Hulstedt, from the receiver of the Citizens State bank at Wahoo, one of the defunct Kirchmantitutions. The court found that Emil Benson, while guardian of Hulstedt, and cashier of the bank, fraudulently disposed of his ward's property and converted it the bank's use.
LINCOLN EVENING JOURNAL - TUESDAY, OCTOBER 20, 1936
BENSON BECOMES A TRUSTY
Former Wahoo Banker to "Dress In" New Prisoners
Emil Benson, former Wahoo banker, who entered the state penitentiary here in 1930 to serve a five to ten year sentence in connection with the failure of his bank, became of the chief trusties at the prison Tuesday.
He was given the place long held by Tom Kelley, who with his brother Roy, was freed on commutation of sentences for robbing a jewel salesman in Fremont in 1929. Benson will have charge of "dressing in" new prisoners and have various other dut.
Kelley entered the outside world with this statement: "I want to bury the past and live in the future. I am going to prove to the world a man can make good coming out of prison. The 945 men I am leaving behind expect me to make good. I shallt betray them."
LINCOLN EVENING JOURNAL - MARCH 10, 1937
BENSON APPEALS
Emil Benson, 53, former Wahoo banker who is now serving his second ten year sentence for using the bank to defraud, told the (parole) board that of the 30 Nebraska bankers who have received prison sentences he has served the longest time. Theerage, he said, was 2 1/2 years.
Benson was originally sentenced on three concurrent terms of five to ten years on April 23, 1930. He completed those terms Jan. 14, 1937. On May 25, 1931, he was taken to Saunders county and after further prosecution, received the ten year sence on which he is now serving.
"I put all the money I had into the bank to keep it from closing," Benson told the board. "I lost it all and didn't profit one cent."
B. O. Hendricks, Wahoo attorney, told the board that he was called to the Benson home and the banker told him that something was wrong at the bank and that he wanted to go to the pen because his family had promised to stand by him if he woulo the right thing. Hendricks said he notified the county attorney and helped prepare the information against the banker and then went with him to court where Benson pleaded guilty.
Since then, the attorney said, the banker's family has turned against him, he has lost all his property, and his wife secured a divorce.
Olaf Pearson, Wahoo, a brother-in-law testified that Benson did not profit personally by ony of the money used in the transactions. C. O. Bruce offered employment. Others to speak in Benson's behalf were, Fred Hall, Carl Goucher, Wahoo, J. B.omas, W. H. Frost. Letters are on file from E. B. Perry and Walton B. Roberts urging his release.
Clemency was opposed in letters from Sheriff Mengel and Co. Atty. Hood. Hood charged that Benson did not co-operate in aiding the settlement of the affairs of the bank.
LINCOLN STATE JOURNAL - MARCH 11, 1937
BENSON APPEALS
Emil Benson, 53, former Wahoo banker who is now serving his second ten year sentence for using the bank to defraud, told the (parole) board that of the 30 Nebraska bankers who have received prison sentences he has served the longest time. Theerage, he said, was 2 1/2 years.
Benson was originally sentenced on three concurrent terms of five to ten years on April 23, 1930. He completed those terms Jan. 14, 1937. On May 25, 1931, he was taken to Saunders county and after further prosecution, received the ten year sence on which he is now serving.
"I put all the money I had into the bank to keep it from closing," Benson told the board. "I lost it all and didn't profit one cent."
B. O. Hendricks, Wahoo attorney, told the board that he was called to the Benson home and the banker told him that something was wrong at the bank and that he wanted to go to the pen because his family had promised to stand by him if he woulo the right thing. Hendricks said he notified the county attorney and helped prepare the information against the banker and then went with him to court where Benson pleaded guilty.
Since then, the attorney said, the banker's family has turned against him, he has lost all his property, and his wife secured a divorce.
Olaf Pearson, Wahoo, a brother-in-law testified that Benson did not profit personally by ony of the money used in the transactions. C. O. Bruce offered employment. Others to speak in Benson's behalf were, Fred Hall, Carl Goucher, Wahoo, J. B.omas, W. H. Frost. Letters are on file from E. B. Perry and Walton B. Roberts urging his release.
Clemency was opposed in letters from Sheriff Mengel and Co. Atty. Hood. Hood charged that Benson did not co-operate in aiding the settlement of the affairs of the bank.
LINCOLN STATE JOURNAL - MARCH 13, 1937
COMMUTATIONS GRANTED
Emil Benson, Saunders county, making use of bank to defraud. 10 years. May 25, 1931. (To be held on parole.)
LINCOLN EVENING JOURNAL - MARCH 27, 1937
U. S. Atty. Hawxby Saturday nolle prossed a federal indictment against Emil Benson. Wahoo man who was recently paroled from the penitentiary here. The indictment charged Benson with misapplication of National Farm Loan association funds and Hawxby said the state charge under which Benson was convicted covered much the same dealings.
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