CRIME: How to Buy a Bank

In the industrial town of New Kensington, Pa. last week, an almost classic example of bank embezzlement came to light: Bank President Ludwig R. Schlekat confessed that he had swiped $600,000 of the passbook holders’ money.

His institution, the Parnassus Bank, was the oldest in town (pop. 25,226), and Schlekat was so quiet, so respectable, so trusted by the public that any experienced bank examiner would have found both the crime and the criminal familiar to the point of triteness. Grey-haired, spectacled “Luddy” Schlekat, a local boy of good upbringing, started at the bank soon after he got out of high school. He worked hard, married a nice girl, sired two nice children, bought a nice house, went to the First Evangelical Lutheran Church regularly, joined the Lions Club and the Chamber of Commerce.

Even the slip that undid him had a familiar ring: the examiners found a notation of cash supposedly on hand: $719,000. They counted the money and found only $119,000. But they could not discover why Schlekat had stolen $600,000. There was no woman in the case, no racetrack gambling, no wild parties. Then the bank’s former president, Charles C. Alter, described his own retirement to the examiners. A New Kensington real-estate man (now dead) had approached him four years ago on behalf of two “Ohio businessmen,” H. A. McDevitt and J. H. McKeown, and offered $254,000 for 540 shares of the bank’s 750 shares of stock. He had accepted, and Schlekat, although only an assistant cashier at the time, had been elected president by the new stockholders.

This tale led to the revelation of an eminently novel twist. Investigation proved that neither H. A. McDevitt nor J. H. McKeown had ever existed except in Schlekat’s imagination: he had stolen the bank’s money to buy the bank.