COMMERCIAL NATIONAL BANK

Check.

COMMERCIAL NATIONAL BANK. The bank was organized in March, 1871 and located in the Globe Building at the northeast corner of Main and Fifth. Subscribers of the bank included R.E. GRAVES, Henry L. STOUT, William ANDREW, Alfred TREDWAY, William G. STEWART, William L. BRADLEY, Sr., Leroy D. RANDALL, W. H. RUMPF, John Robert WALLER, and John THOMPSON. (1) On March 5, 1871 the officers of the bank were announced. They were R. E. Graves, president; H. L. Stout, vice-president; and H. M. Kingan, cashier. (2) The directors were the others who had been original subscribers.

Graves' career in Dubuque began in 1856. When a state bank was suggested for Dubuque, he offered excellent recommendations. Caleb H. BOOTH, bank commissioner, finding himself faced with several of his friends also seeking the opportunity of establishing the bank chose Graves instead. When the state banking law was abolished, Graves' bank was converted into the FIRST NATIONAL BANK OF DUBUQUE. Graves remained president of the bank until 1871 or 1872 when he sold his interests to D. N. COOLEY. (3)

Graves' re-entry into banking proved an immediate success. The bank was soon declaring annual dividends of ten percent while building a large surplus. (4) Concerns about the $104,000 First National Bank had lost in clearing up debts Graves had left were gradually forgotten. It was also understood that Julius K. GRAVES, brother of the bank's president, had a larger credit at the bank than might be wise. (5)

The Commercial National Bank Of Dubuque issued 2,400 sheets of $1 original series national bank notes. A print range between 1,000 and 2,500 is small. Some notes had a red charter number, others do not. Some had red serial numbers and some had blue serial numbers. Some were printed on white paper and others are printed on paper with a slight blue tint. (6)

The bank printed 2,400 sheets of $2 original series national bank notes. All $2 bills printed before 1875 are very rare. Most survivors represent the only known example for that bank. Collectors call these $2 bills "lazy deuces". The large two on the face of the bill was pictured horizontally making it look lazy. (7)

There were also 5,400 sheets printed of $5 original series national bank notes. Each five dollar original series bank note had a spiked red seal, the only design difference between it and later issues. The back of each note has a vignette of the state seal. (8)

The Commercial National Bank Of Dubuque also printed 2,780 sheets of $1 series of 1875 national bank notes. Hundreds of banks had sheet outputs between 2,500 and 5,000--typical for a medium sized national bank in the 1870s. Series of 1875 one dollar first charter national bank notes were only printed between 1875 and 1878, the shortest production period of any national bank note. (9)

A total of 2,780 sheets of $2 series of 1875 national bank notes were also printed by the bank. (10) The Commercial National Bank Of Dubuque printed 10,533 sheets, a high issue number for a national bank, of $5 series of 1875 national bank notes. (11)

In September, 1875 Commercial National Bank assumed the liabilities and assets of the PEOPLE'S SAVINGS BANK. (12) Mr. H. K. Love, president of People's Bank, had agreed to be the president of the Iowa National Bank in Des Moines. (13)

Problems began in 1885 when President Graves decided to hold Directors William Andrew and Henry L. STOUT responsible for large advances made on their recommendation to the DUBUQUE OATMEAL MILL. Having agreed to large loans made by President Graves, the two directors announced that they would withdraw their accounts in the bank if he remained in office. In May 1886, Graves sold his share in the bank to Caleb H. BOOTH and personally guaranteed the assets to be worth the amount paid. The contract of sale specified that on or about February, 1887 the board should fix the value of the stock. This led to the discovery of large loans involving bank officials made prior to the sale. J. K. Graves, when asked for a settlement of his debts, replied verbally that he had $100,000 "spot cash" to cover his obligations. On March 19 or 20, 1888, however, a demand for a written proposition from him proved that the "spot cash" was actually $50,000 in Iowa City common gas stock, $24,000 in Commercial bank stock, and his note for $30,000. This meeting caused the new directors to pass a resolution declaring the bank suspended. (14)

The Commercial National Bank closed its doors on March 20, 1888 with $444,059 due to depositors. The total liabilities were $518,310.

E. P. Welles, of Clinton, was appointed receiver. He charged violations of the law by the bank officials and on that ground asked for the forfeiture of its charter; he also charged that false statements had been made. Wells collected the one hundred percent assessment from some stockholders and recouped an estimated $25,000. In November 1892 he sold $300,000 of assets in an auction and received another $10,500. (15)

On April 9, 1890 the United States grand jury indicted Graves and cashier Harris for making false entries to the comptroller of the currency to deceive him and the directors of the bank. The liabilities of the directors of the bank were much greater than had been reported.

R. E. Graves left the city before the closing of the bank. He was involved in banking in Colorado Springs and then moved to Tucson, Arizona where he was the head of the Arizona National Bank. Mr. Harris was employed by a bank in Pueblo, Colorado. (16)

The jury was in deliberations for only a short time before finding Graves guilty. He was sentenced to five years in the penitentiary. On furnishing $10,000 bail he returned to Tucson. Harris plead guilty and the sentence was suspended. On November 11, 1893 President Cleveland pardoned Harris. The Dubuque Herald stated that "it was so plain that while legally guilty he was not morally so..." (17)

Graves' attorney appealed the case to the United States Supreme Court alleging errors of law and on the ruling of the court during the progress of the trial. The defense had tried to introduce as evidence customs in use in other banks governing overdrafts which, in Graves' case had been considered loans and therefore regarded as assets. When Charles H. EIGHMEY took the stand to show this custom was in use in other banks, the court ruled that whatever the custom it would not apply and therefore Mr. Eighmey was prevented from testifying. Graves' attorney had also tried unsuccessfully to introduce the deposition of Lyman J. Gage, Secretary of the Treasury, who had been president of the First National Bank in Chicago. (18)

The Supreme Court reversed Graves' conviction in 1897 and ordered a new trial. There is no record that this was ever held.

See: BANKS AND BANKING

See: PANIC OF 1873

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Source:

1. "A New National Bank," March 1, 1871, Dubuque Herald

2. "Commercial National Bank," March 5, 1871, Dubuque Herald

3. "The Commercial Bank," Dubuque Herald, December 4, 1892

4. Ibid.

5. Ibid.

6. "Old Money from the Commercial Bank of Dubuque," Online: http://www.antiquemoney.com/national-bank-notes/iowa/old-money-from-the-commercial-national-bank-of-dubuque-1801/

7. Ibid.

8. Ibid.

9. Ibid.

10. Ibid.

11. Ibid.

12. "People's Bank-Notice," Dubuque Herald September 26, 1875

13. "New Financial Move," Dubuque Herald September 21, 1875

14. "The Commercial National Bank"

15. Ibid.

16. Ibid.

17. "Pardon for C. H. Harris," Dubuque Herald, November 11, 1893

18. "Graves' Great Luck," Dubuque Herald, February 16, 1897

"Butchers, Bankers, and Cabinet Makers," Booklet accompanying the Robert Reding exhibit at the OLD JAIL 2007-2010

Oldt, Franklin T. History of Dubuque County, Iowa. http://www.ebooksread.com/authors-eng/franklin-t-oldt/history-of-dubuque-county-iowa-being-a-general-survey-of-dubuque-county-histor-tdl/page-21-history-of-dubuque-county-iowa-being-a-general-survey-of-dubuque-county-histor-tdl.shtml