George A. Richardson began working as a messenger for the McCartney National Bank of Green Bay at the age of fourteen in 1891. He worked his way up the ladder to cashier and was made president of the bank in January 1931 succeeding his brother-in-law J.H. Tayler. On May 21, 1931, Richardson arrived at the bank in the morning and met briefly with Tayler, cashier T.G. Bailey and assistant cashier Bernard Olejniczak. He retrieved a pistol from the cashier’s cage, walked into the bathroom and shot himself — precipitating the beginning of the end of the bank.
The McCartney Exchange Bank was founded as a state bank in 1882 by David McCartney in Fort Howard, Wisconsin (presently the west side of Green Bay). It was incorporated as a national bank in 1892 as the McCartney National Bank of Fort Howard receiving charter number 4783. Three years later when the borough of Fort Howard was married to the city of Green Bay the bank changed its name. McCartney was lured to Wisconsin from Ohio by the lumber industry and operated two saw mills near Green Bay before investing in pine lands in Georgia.
Tayler succeeded McCartney as the bank president in 1892. The bank prospered in the early part of the twentieth century under his direction. It was key to financing much of the development on the near west side of the Fox River. Among the banks largest customers were the Larsen Company canning operation and the Green Bay Sugar Company. Tayler served on the board of directors of these two companies as well as two state banks located in New Franken and Wrightstown, Wisconsin. This incestuous business and banking relationship would be a contributing factor in the bank’s demise.
The Fox River Valley area of Wisconsin weathered the Great Depression better than most parts of the country. The paper and tissue mills that lined the river remained viable although production decreased. The same could not be said for the local agricultural industries. Falling farm prices in the mid-to-late 1920s were caused by an overabundance of crops. The stock market crash of 1929 and the ensuing economic depression reduced the demand for agricultural products.
Tayler and Richardson were heavily invested in agricultural businesses in Northeast Wisconsin using their positions with the McCartney National Bank to finance the ventures. As the agricultural economy ground to a slow crawl, their house of cards began to unravel. Tayler and Richardson had borrowed heavily from the bank.
As news of Richardson’s suicide began to spread, panic descended on the financial institutions in Green Bay. By the end of the day $25,000.00 in deposits had been withdrawn from the bank. At a special shareholders meeting held that evening it was decided not to open the next day. In order to try to quell the fear in the community, J. H. Tayler announced that Richardson’s books had been examined and everything was found to be in order. Tayler’s announcement regarding the state of the accounts was technically correct, but he failed to disclose that the books only balanced because of notes owed to the bank by he and Richardson and other investors.
An uneasy calm settled over Green Bay for the next week. The operation of the McCartney National Bank was placed in the hands of a receiver. The crisis flared back up on June 2, 1931 when the Brown County State Bank closed its doors for examination and it was revealed that that institution was heavily intertwined with the McCartney National Bank. Pandemonium ensued as worried depositors streamed into the other Green Bay banks that morning.
John Rose, president of the Kellogg-Citizens National Bank, and other local leaders tried to soothe the mob. In a very public exhibition, Rose had prominent men enter the banks and ostentatiously make large deposits. The Kellogg-Citizens National Bank remained open after hours to allow depositors to make withdrawals – a sign that was intended to inspire confidence in the bank’s stability. A half million dollars in cash was trucked in from banks in Milwaukee and Chicago and when the Green Bay banks opened on June 3, it was displayed in large bundles on their counters. Sanity returned and the crisis was averted.
But things would not go so well for the principals of the McCartney National Bank. C. C. Phelps, Tayler and Richardson’s brother-in-law and an investor in the bank and several of Tayler’s other businesses committed suicide as did Austin Larsen, president of the Larsen Canning Company, due to financial losses brought on by the collapse of the bank.
J. H. Tayler was arrested for embezzlement in September 1931 and filed bankruptcy in December of that year. He was essentially kiting checks among six different banks. He defended his actions as being acceptable banking practice. He was convicted in December 1932, the trial having been delayed due to poor health — despite this he managed to live another 28 years and passed away in 1959 at 100!
Things went better for the bank’s depositors. The receiver sold off the bank’s assets and called in a 100% assessment against the stockholders. It took several years but the depositors received most of their money back in a series of liquidating distributions. The Kellogg-Citizens National Bank took over the redemption of the still circulating National Bank Notes issued by the bank.
One thought on “The Collapse of the McCartney National Bank of Green Bay”
Fascinating story Jim.
From messenger to Bank President, those were the days.