ustxtxb_obs_1956_02_15_50_00004-00000_000.pdf

Life Insurance Company in Texas with $1,000,000 Capital and Surplus Paid in. Cash Prior to writing business August, 1954. To set a .World’i Production record of over $33,000,000 in its first year. ST ST And Now Over $43,000,000 LIFE INSURANCE IN FORCE AS OF DEC. 31, 1955. Home. Office: .5011 Fannin, Houston, Texas AGENCIES THROUGHOUT .TEXAS Western Indemnity Life InsUrance .Compoiny 72,.vv ….—-.^^11, Name Parkhouse, Rogers, Moore Regents’ Ire AUSTIN Senators George Parkhanse of .Dallas, Johnnie B. Rogers of Austin, and Bill Moore of Bryan received valuable considerations . from insurance companies for work they did, they con7 ceded last week ; and Rep. Doug Bergman granted he Was board. chairman of an investment corporation which considered a merger with a now de. funct investment company. :Meanwhile, Rep. ‘Wade Spilman, chairman of the House investigating committee, called for passage of a robbyist control a n d .regulation .bill \(“We’ve got to encourage honest folks to run for office and stay hon.:. of Corpus ,Christi asked Spilman to . tall Ed Clark of Looney, Clark, and Morehead and John VanCronkhite, Austin PR man, to inquire into their lobbying activities. . At last report only 23 members of the House had signed the petition circulated by Reps. Hardeman and Hughes for a special impeachinent session, of that legislative chamber. A total of 76 would be required, so the session appeared unlikely. Parkhouse was given 500 shares in Robert E. Lee Insurance Co. in 1953 and sold them in 1955 for .$7,000. He said he appeared before the State Insurance Commission for the company “about three or four times” on minor items -. He is not a lawyer.. “I helped them on account of friendship and they wanted to show me they appreciated it,” Parkhouse said. “I spent considerable time on the company.” Also around 1953, Sen. Rogers said, he gave a list of prospects to R. L. .Russell,. who was selling stock in. the, same Lee insurance firm. He said he called Russell a year later to get his . commission, which was $400. Rogers said he saw nothing “illegal or intmoral” in it. Russell subsequently be -came president of First. Colonial In , vestment Co., now in receivership, and the $400 was charged to that firm. \( City Councilwoman Emma Long of Austin announced before this broke that she will oppose Rogers this .stntrier. She. said she will ‘campaign,. in part, against “loan sharks,”. “creeping sales, taxes,” and “specialinterest lob bvists.” She is ,vice-chairman of the Travis County Democratic -. Bergman said he resigned as chair-, man of Lin -coin Investment Corp: “because it looks.. like .it’s becoming a. crime to engage. iriNbusiness … Some of this is getting ridiculous and the in Insurance Firms Paid Them For Work; No Session’ Seen nuendo is hurting a lot of people.” A merger had been proposed between Lincoln Investment and the same First Colonial Investment Corp. AUSTIN Almost a million dollars has, been returned to creditors of bankrupt insurance companies since State: LiquidatorJ. D. Wheeler took office on March 26, 1954, he said last week. Last year, ‘he said, $476,000 was paid to . creditors of 56 defunct concerns, as against $368,000 spent for administrative expenses. At year’s, erid he’had $631,000 on hand for the companies’ creditors. Since March, 1954, Wheeler has disbursed $943,000 to rceditors and $733,000 in administrative expenses. No figures are yet forthcoming from the liquidator on total creditors’ losses in Texas insurance failures in recent years. The Insurance Commission last week delivered three more show cause orders to Texas conipaniesMerchants National Life .’ Co. of Denton,. for. Feb. 23 on 14 allegations, includ. ing one of capital iinpairment in excess of 50 .percent; Western World Mutual Life Insurance Co. of Fort Worth, -for Feb, 29 on eleven allega-‘ tions, including fraud and insoWency; and American Home Mutual Life Insurance Co. of Dallas, for Feb. 21 on charges of ‘fraud and insolvencY. Texas Union County Mutual was put in tentporary receivership by an Austin judge when no representative appeared for a show cause hearing. The commission approved certificate As of now the Waco grand jury has heard from these senators, subpoe naed by the jury to appear : Sens. Kelley, Edinburg; Corbin, Lubbock; Moore ; Ashley, Llano ; Fly, Victoria; Lock, Lufkin ; Colson, Navasota ; and Martin, I4illsboro. Sens. Weinert, guin, and Straus, Hallettsville, have not answered the Waco subpoenas because of court business and ill health, respectively. Ford’s letter also suggested the House committee subpoena Garland Smith on “airplane rides, sightseeing tours, and the $6,000 loan”; John Ben Shepperd on “airplane service” by an insurance company; “the representatives that received the airplane ride to Kentucky”; and Gov. Shivers on’ why he does not fire the insurance commissioners. cancellation of the Winter .Garden Burial Association, Eagle Pass. ‘Insurance. Commission .Chairman J. Byron Saunders replied to charges of fraud, negligence, and bribery by Renne Allred, Jr., former state liquidator’s attorney, before the Senate investigating committee. Saunders said the companies were formed eight or ten years ago, before he and Mark Wentz were on the commission, and referred the senators to L. W. Blanchard, suspended chief examiner, for answers. He said he assluned all the qompanies’ records had been before grand juries. New restrictions will prevent further fraudulent practices like those Allred pointed out, Saunders said. Allred, in a wire, responded: “Not a single one of the cases … were licensed as far back as Saunders’s memory takes him and one of the companies, Commercial Security, was first licensed in April, 1954,. by Byron Saunders and Garland Smith. Saunders is still up in the clouds from having made too , many airplane trips to Florida, Mexico, Cuba, California, Missouri, and Nevir York and possibly elsewhere with insurance executives The “Missouri and New York” references were not specific. Smith and Saunders cut off questions on such flights some time ago. Allred has said he was fired for wanting to sue Blanchard in a receivership case. Saunders said it was for “general inefficiency”, and said Allred spent 42 .days in California in 1950 checking records of …Pacific Finance Corporation in Los Angeles and turned in an expense. account Of $552.05.”Saunderssaid Allred had his wife with him. Saunders said in the Texas Mutual case Allred drew $4,800 of $6,970 spent on receivership costs. Last week Felix Einsohn, Dallas C. P. A., repeated for Associated, Press the explanation he gave the Ob. server late .last year on his roleas a last-minute auditor of U.S. Trust. & Guaranty for a proposed substitute management group. He said .he. was recommended by’ “a Dallas insurance executive,” presumably BenJack Cage. He said the Waco operations. of the company were moved to Dallas during his audit to provide an excuse for firing employees without starting a run on the company. He said again he withdrew when A. B. Shoemake failed to co:operate with his inquiry. Einsohn was scheduled to testify before the Senate group but was ‘excused ,at the last minute because ‘of “urgent buSineSs” in New York. Thiis he has not yet been examined publicly on’ his role. THE TEXAS OBSERVER Page 4 February 15, 1956 Over Politics \(Continued from page he was aware that.. they feel. “the overall effect of. the Texan editorial pages has been harmful to the University, overall.” He objected to-an interpretive remark in the Texan that the insurance scandals have become “synonymous with corrupt .governMent.” He said the Regents’ objection frequently. was that there was “no comment on the other side in that same Lee said most of the complaints were on issues in Texas politics. Dr . Logan Wilson, ‘University ,pregident, has stated he feels sure the Regents would not object to Texan editorials if the “otter side” were printed in the same issue “side by side” with the Texan’s position. Lee also entered his own objection, which” he said was not reflecting points. raised by the Administration,’ to the guest column. by Hart . Stilwell, which he said implied Shivers is “a ‘fourthrate politician.” Friday, at. another meeting of the board,’ Lee stated the criticiSms more generally. First, it had been ebmplained, he said, that “the editorial policy is made solely by one man. usually under 25 years of age,” and, second, that “the elected editor is responsible to no one.” ‘ Morris’s reply was that the editor is responsible to the students who elect him. \(Morris got a two-to-one CAUGHT in the student’Regent crossfire are the, faculty memberS. of the publications board. The students have a six-to-five majority on thig -board and exercised it last week in approving for publication editorials Lee had rejected, the faculty members present voting “no.” Dr. DeWitt Reddick, acting dean of the School of Journalism, states that the Texan’s freedom “resides not with the editor but with the board of ‘1 eras Student Publications.” He feels that the Regents, when they fully understand the editor-publications board relationship, will be satisfied that what the faculty members have tended to interpret as the Regents’ request for a study of the problem has been answered. Olin Hinkle, associate professor of journalism, also maintains ‘that the board, not the editor, is the policy proprietor of the Texan, as the Te: .:as Student Publications handbook speci fically provides. Restrictions are pro.vided on the editor in this handbook, Hinkle said, and he added: “The extent to which good judg ment would call for an extension of such .restrictions is a matter of degree .and will vary according to circumstances.” Student President Rolan,d Dahlin, leader of the Student Assembly which voted 25-1 for a “free editorial policy” for the Texan, is also chairman of the publications board. He said Monday night: “I think it’s a question of the final The is sue is whether we can have a truly independent Texan editorially. I think the editor should be completely free to comment in any way he -wants to.” -It is -not clear whether all the student mernbers of the publications board agree. The board appears prepared to assert its editorial authority over the Texan according to the -existing handbook regulations. The question then will still remain : what will they do about-policies criticizing a political administration, a bill in -.’the Legislature or Congress, or a public official ‘or candidate ? .*The entire academic community is agitated by.the issue, and it has attracted’ national attention: because of the explosive issues involved.. R.D. Sen. Moore, previously questioned by the Observer on whether he took funds froth A. B. Shoemake’s U. S. Trusthe refused to` answer the questionadmitted he got $500 from the firm in 1953 for legal work after State Auditor C. H. Cavness released a report with his name in it as receiving the fee. Moore said Cavness was going out of his way to involve him. \(The report also showed Rep. Bert McDaniel was paid $2,150 in 1953 and ’54 by . the Shoemake firms and exRep. Sam Sellers got $1,250 in that period. FIGURES FOR CREDITORS