Plain Dealing Bank Goes Belly-up

Plain Dealing Bank. Corner of Palmetto Ave. and Lynch St.
Plain Dealing Library Collection 1997.031.102

On May 3, 1904, the Plain Dealing Bank was chartered with a capital stock of $25,000 divided into 500 shares of $50. The first Board of Directors were H.H. Montgomery, President; P.G. Pye, First Vice President, and Cashier; W.B. Boggs, Second Vice President; S.H. Cochran, Dr. T.N. Keoun, N.W. Sentell, W.J. Johnston, and J.P. Keeth. Four months after the charter was filed, the bank opened its doors for business.

Although P.G. Pye was listed in the charter as the cashier, W.M. Stephenson was the first cashier when it came time to open for business. After his resignation in early 1905, Jonah Perry was elected to succeed him. Perry had been serving as the Cotton Belt Railroad agent before becoming the cashier. He temporarily employed the assistant cashier W.J. Pugh from the Bank of DeRidder to assist him in getting started with the job.

Being a cashier of a small-town bank back in those days often meant you were a one-person show. For the next sixteen years, Perry not only served its members at the cashier window processing deposits and withdrawals, but he also processed loans, maintained the bank's books, charged overdraft fees, and collected monies due, among other things. During that time, he earned the people's trust, and he even served as the Mayor of Plain Dealing from 1914-1916.

But in April of 1921, he fled to Arkansas. "Upon making his departure Sunday night, Perry left a note intimating that he was short in his accounts and announcing that the bank would have to suspend operations, but he gave no information as to where he was going." "It is stated that Perry had told his wife when he left home Sunday, that he was going to Little Rock, and instructed her to inform Sheriff Adair that he would return voluntarily when notified that his presence was desired. Sheriff Adair wired Perry at Little Rock Wednesday, requesting him to return, and a few hours later the sheriff received a message from the fugitive that he was on his way, and asked Sheriff Adair to meet him in Shreveport."

The following statement by his attorney, Thomas W. Robertson, appeared in The Shreveport Journal, "Mr. Perry denies that he got any of the money – not even a nickel. The losses were occasioned [sic] by injudiciously allowing overdrafts and the accumulation of uncollectable notes, coupled with a loose system of keeping track of profits and losses. This condition of affairs was brought about largely by the fact that he had no assistance, and the work, for several years has been entirely too arduous for him, rendering it impossible for him to perform correctly all of the various duties devolving upon him."

"According to his attorney, Perry, at the time of the crash, was worth, in notes, bonds, stocks, land and property of various kinds, in the neighborhood of $20,000, and that he surrendered it all in an effort to protect, as far as he was able, those who had lost through the bank's failure." A final audit of the books revealed that the bank had been insolvent for four or five years and the shortage was $121,000. Even with Perry surrendering his property and monies and the bank's liquidation, the members only received a small portion of their money back after waiting nearly a year.

Perry was convicted and sentenced by Judge Roberts of Minden to serve 9-10 years in the state prison. His attorney filed a motion for a new trial but was denied. He then appealed the case to the Supreme Court, which sustained the district court's verdict. Perry maintained his innocence in the embezzlement charge and that he never personally made use of the money. He was granted an early release from jail and was discharged on May 9, 1926. He died on Christmas eve that same year.

Shortly after the Plain Dealing Bank closed, the State Bank of Plain Dealing was organized, with a capital stock of $15,000 and Dr. Shea Edward Prince as president. It purchased the building and fixtures of the defunct institution and opened for business on Sep. 1, 1921.

An independent agency of the federal government, the Federal Deposit Insurance Corporation (FDIC), was created in 1933 in response to the thousands of bank failures that occurred in the 1920s and early 1930s. The National Credit Union Administration, which regulates and insures credit unions, was formed in 1935.

By: Amy Robertson