Premier Building Society.

Gisborne Standard and Cook County Gazette, Volume IV, Issue 471, 24 June 1890, Page 3

Premier Building Society.

CHARGES OF CONSPIRACY AND FRAUD. Melbourne, June 11. The hearing of the charges which have been brought against the Directors of the Premier Permanent Building Society and some of the customers of the Association by Colonel J. M. Templeton, the official liquidator of the insolvent institution, was commenced in the city court yesterday. Mr Purves, Q.C., prosecuted, and stated his intention of dealing with the alleged conspiracy that had been formed to obtain larger advances from the Society on certain lands than these lands were actually worth. The persons implicated in this charge are Mr John Nimmo, M.L.A., Mr John L. Dow, M.L.A., ex Minister of Lands, Mr J. E. Gourlay, Mr John Stewart, Mr T. Ferguson, Mr W. Doherty, Mr J. Mirams, Mr Philip Corkhill, Mr Patrick J. Murphy, Mr Robert Murphy, and Mr Bernard J. Murphy, the last four named persons being customers, and the others Directors and officers. Mr Purves spoke for upwards of four hours, and had not then completed his narrative of all the peculiar transactions which he promises to prove. He read portions from the original prospectuses of the Society, in which many reasons were given why people should invest their money in the Association, and said that in view of whit was known to him,

and would be disclosed to the Court during the progress of the trial, these printed inducements bore a grotesque air of savage cruelty. Instead of remaining true to the professions made to the trusting shareholders, the accused had deliberately and fraudulently schemed to gather together the hard earned savings of people, and had used them for illegal and improper purposes. He went on to explain the transactions between the Directors and the three Murphys, who are father and two sons. These gentlemen, he said, nominally owned certain land in Elsternwick, but in reality the land belonged to Mr Gourlay, one of the Directors of the Association, Robert Murphy applied for a loan on the land, and also for certain advances to enable him to erect several houses on the land. The loans were granted without consulting the solicitor of the Association. The contract for the loan was signed, and a certain sum advance!, when Mr Emmerton, the solicitor of the Association, wrote to the Directors and informed them that they had done an illegal thing, inasmuch as they had advanced the money without any seouti'y, Mr Mqrphy was seen, and though he had undoubtedly obtained all the best of the bargain ha undertook to at once cancel the contract. Thia jras reported to the solicitor,, but on the following day an application was made by another of the Messrs Murphy for a similar advance on the same land, and on the came terms, and though the land boom had burst by thia time and properties had depreciated very considerably in value, the advances were granted. The Society held no secmity for the advance, and concluded Mr Purves, •• It wee a capital joke in the city that the Premier bad advanced money to build on land hald under mortgage by a kindred association.” He also pointed out that Gourlay, who really owned the land, sat as a director at the meetings when the loans were granted. Dow also sat as a director at these meetings though ha was not eligible. He took up only twenty investment shares in the Sooiey. and these he never paid up, so that in September, 1886, in consequence of the non fulfilment ot his contract, his name was actually struck off the list of shareholders, yet for two years after that date he acted as Director and drew the Director’s tees. The cases are not expected to end for several days. The hearing of the charge against ths officers of the Society of issuing a fraudulent balance sheet, has been concluded, but the Bench have not yet committed the accused for trial, pending the conclusion ot the present charge, and also uf another against the Directors and officers of fraudulently manipulating a fresh issue of shares in the Society for their own benefit. Great interest is taken in the prosecutions.