"* * * That prior to the 4th day of September, 1923, the Southwestern Washington Bank was a corporation organized and existing under the laws of the state of Washington and engaged in a general banking business at Ilwaco, Pacific county, Wash., and was the only bank in the town of Ilwaco.
"That immediately prior to the 4th day of September, A. D. 1923, the supervisor of banking of the state of Washington, after an examination, found the said Southwestern Washington Bank to be unsound, unsafe, and in an insolvent condition on account of mismanagement and embezzlement on the part of the officers, and that the assets thereof had been reduced and dissipated to such an extent that on September 4, 1923, and for some time prior thereto, the actual cash market value of the total assets was insufficient to meet the outstanding indebtedness of said bank, and said supervisor of banking thereupon, on said 4th day of September, A. D. 1923, by virtue of authority vested in him by law, took possession of said bank, and ever since has been, and now is, engaged in liquidating its affairs, and T. H. Adams, the defendant herein, is the special deputy supervisor of banking liquidating the affairs of said bank. That on said 4th day of September, 1923, and immediately prior thereto, said bank was insolvent, in that its assets at a fair valuation were insufficient to pay all of its debts.
"That during all of the time mentioned and referred to in the pleadings herein Rees B. Williams was the regularly qualified and acting postmaster of the United States post office at Ilwaco, Wash.
"That said bank, through its authorized officers and agents, had qualified under the rules and regulations of the Post Office Department of the United States as an authorized depository of postal savings funds, and for this purpose had deposited as collateral security with the Treasurer of the United States Liberty Bonds of the par value of $2,000, and the postal savings account with said bank was carried in the name and to the credit of the board of trustees of the Postal Savings System.
"That some time prior to the taking possession of said bank by the supervisor of banking of the state of Washington, for the purpose of liquidation, to wit, on August 13, 1923, the board of trustees of the Postal Savings System had a deposit in said bank in the principal sum of $1,793.64, and that the said postmaster of Ilwaco had on hand at said time $800 in postal savings funds which he was not authorized to deposit without additional collateral security. That said postmaster, relying on the representations of the cashier of said bank that additional bonds in the required amount would be forthwith forwarded to the Treasurer of the United States, deposited said sum of $800 to the credit of the board of trustees of the Postal Savings System, making a total deposit of said account in the principal sum of $2,593.64. That the cashier of said bank did not make any deposit of any additional collateral security, and no bonds were deposited by said bank with the Treasurer of the United States as collateral for said postal savings account in excess of $2,000. That the said bank had on hand at all times, after said deposit of $800 was made, and when possession was taken by the supervisor of banking, cash assets exceeding the amount of said deposit.
"That following the taking possession of the said bank and the liquidation of its affairs, as hereinbefore stipulated, the board of trustees of the Postal Savings System sold the Liberty Bonds mentioned and referred to at the market value, to wit, $97.19, or a total sum, including accrued interest, amounting to $1,954, which sum the board of trustees accredited to said bank account of the postal savings account, which totaled $2,613.23, leaving a balance due said board of $659.23.
"That on August 13, 1923, the said postmaster purchased from the said bank its cashier's check No. 2689, in the sum of $125, the said cashier's check being made payable to the order of Rees B. Williams, and was purchased, as the cashier of said bank then and there knew, with funds received by said postmaster from the business and operation of the United States post office at Ilwaco.
"That on August 23, 1923, the said postmaster, Rees B. Williams, purchased from the cashier of the Southwestern Washington Bank its cashier's check No. 2722, payable to the order of Rees B. Williams for the sum of $155, said purchase being made from public money received by the postmaster from the business and operation of the United States post office at Ilwaco, which fact was then and there known to the cashier of said bank.
"That on August 29, 1923, the said postmaster, Rees B. Williams, purchased from the cashier of the Southwestern Washington Bank draft No. 633, in the sum of $425, payable to the postmaster at Seattle, and drawn on the Dexter-Horton National Bank at Seattle. That said draft was purchased from surplus funds received by the postmaster from the money order division in the operation of said United States post office at Ilwaco, and the cashier of said bank then and there knew that said purchase was being made by said postmaster in his official capacity with post office money.
"That on August 31, 1923, the said postmaster, Rees B. Williams, purchased from the cashier of said Southwestern Washington Bank draft No. 635, in the sum of $820, drawn on the Dexter-Horton National Bank at Seattle, and payable to the postmaster at Seattle; that said draft was purchased from money received by said postmaster from the sale of treasury saving certificates in the operation of said United States post office at Ilwaco, and the cashier of said bank then and there knew that said purchase was being made by said postmaster in his official capacity with post office money.
"That on September 1, 1923, the said postmaster, Rees B. Williams, purchased from the cashier of the Southwestern Washington Bank draft No. 636, in the sum of $95.52, drawn on the Dexter-Horton National Bank at Seattle, and payable to the postmaster at Seattle, Wash., that said draft was purchased as the cashier of said Bank then and there knew, with public funds received by the postmaster from the operation of said United States post office at Ilwaco.
"That on or about November 1, 1923, the United States duly filed with T. H. Adams, the liquidating officer of said bank, its claim for post office and postal funds and accounts itemized as follows:
Cashier's check No. 2689 ............. $125.00
Cashier's check No. 2722 ............. 155.00
Draft on Dexter-Horton National Bank
of Seattle, No. 633 ................ 425.00
Draft on Dexter-Horton National Bank
of Seattle, No. 635, ............... 820.00
Draft on Dexter-Horton National Bank
of Seattle, No. 636. ............... 95.52
Postal Savings Deposits (unsecured) .. 659.23
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Total ............................ $2,279.75