THE LEGEND AND LEGACY OF HENRY C. GRAPER

St. Louis Post-Dispatch

Henderson County Times
Wednesday, March 5, 1980

The banker at the Citizens Bank of Lexington with the policy "never to foreclose a mortgage or call in a note past due."

That description in the St. Louis Post Dispatch, Nov. 16, 1924, describes the legacy of Henry Graper, financier that built and allegedly destroyed the Citizens Bank.

His policy of never foreclosing gave him a reputation of "being good to the poor man," said the DISPATCH.

According to their reporter, Graper, though a Democrat and often a delegate to its national convention, used his benevolent reputation to control the 18-member County Court in this Republican County.

Backing a road bond proposition at the polls in 1920, Graper reportedly followed its success by securing his own appointment as County Highway Commissioner.

Four years later it ended. Or did it? The legend and the legacy persist.

1980 photo captions:

The tombstone declares that Henry Graper is "at rest" in the Lexington Cemetery. Skeptics, noting that Graper's casket was never opened after its return to Lexington, speculated that Graper faked his death and established residence in South America.

Graper's bank, the Citizens Bank of Lexington, was located at the Main St. corner location now occupied by the Pat Carnal Insurance Agency. Graper's second story office overlooking court square now serves as the law office of attorney William Brooks. Though sandblasters attempted to remove "Bank of Lexington" from the facing, close examination reveals the wording still remains.

[This brief introduction was followed with a reproduction of a full page of a feature story about the banker originally printed in the St. Louis Post-Dispatch.]

Dashing Widow Sits Tight with $500,000 — Husband's Betrayed Friends Stand Loss

Confusion and Sorrow Among Those Who trusted Tennessee Banker When He Drops Dead on Train

St Louis Post-Dispatch
Sunday, November 16, 1924

LEXINGTON, Tenn., Nov. 15.
A Staff Correspondent of the Post-Dispatch

LEXINGTON, Tenn., Nov. 12.

When he was alive his friends called him Henry. They speak of him now boldly as Mr. Graper, or just Graper if his name occurs in more than one sentence. Lexington and Henderson County citizens try to show in this way their changed opinion of him.

Is not the discovery of Henry C. Graper's apparently dishonest life that grieves his neighbors. For years they watched him in his bank, trading loans for political services until he had county politics in his grip. For years they saw him as a silent partner entering into questionable deals with the bank's money until he had made a fortune. They had known him for a politician and a sharper. But, alive, he had dazzled them by the sheer audacity of his maneuvers.

He had laughed aside their suspicious inquiries in his easy, confident way. "There's nothing wrong, my friend," he would say. "I know what I'm doing."

And off he would go to Memphis or Chicago to attend to some other big deal.

Eavesdroppers used to delight in his manner of soothing a ruffled victim. Farmers who believed he bad not played fair would begin to doubt their conclusion before be was half finished with his talk. He bored with such a large auger; he was so amazing. His talk had to do with investments here and investments there, with conferences in far-off directors rooms, with high-powered business in great cities. The simple folk of Henderson County were awed into acquiescent bewilderment. To use a slang expression, Henry C. Graper did as he pleased and made them like It.

No, the people here have not seen a sheep turn into a wolf at death. Theirs is not the grief of disillusionment on that score. When Graper dropped dead in a railroad coach a short while back his passing brought a far more terrible revelation. It was this:

The Startling Revelation

Folks had always thought him clever enough to stay within the law, and rich enough to pull out of any hole. They had trusted his very unscrupulousness, thinking that, forewarned, he could do them no financial harm because be was too shrewd for outright stealing. He was, they believed, dangerous if trusted, but safe if watched. This paradox may be explained in other words by quoting the average Lexington resident, who will tell you: "We knew we had to watch Graper but we didn't think he would be crude enough to steal."

He wasn't, he had, it developed within a few hours of his death, taken $350,000 from Henderson County but he had done it in a way that would baffle a grand jury.

His neighbors discovered that:

1. He had loaned out $350,000 cash obtained by the county through the sale of road bonds and deposited with his bank.
2. The Bank of Lexington held $780,000 worth of notes, a large percentage of the amount being worthless paper.
3. He had obtained the signatures of 112 Henderson County citizens to the surety bond for $350,000, which was to protect the county from loss of its road fund. These men had signed the bond, trusting in Graper's sagacity and in the fact that he was reputed to be worth $500,000 and would make good any loss.
4. The county's $350,000 which had been in cash was now but a bundle of notes.
5. Graper was dead and the peculiar power he held was gone. No other could hope to collect as much of the paper in his bank as he might have collected had he lived. Therefore it appeared that the bond signers would have to make up the $350,000 unless they could collect it from Graper's estate.

Everything in His Wife's Name

Then came the climax. It was discovered that Graper, indeed, had holdings which totaled about $500,000. But he had been very careful to sign all his property over to his widow. There was not a single asset in the bank on which the bond signers might levy.

Even this was not all. Many of the notes in the banks vault had been indorsed by Grapers friends and relatives, he being too wary to sign his own name to them.

The revelations struck nearly every home in Lexington and every farmhouse in Henderson County. Merchants around the town square had attached their signatures to the surety bond. Those who had not signed the bond had endorsed notes or had deposits in the bank. Graper's brother-in-law John S. Fielder, who had acted as cashier of the bank, was as hard hit as any. Ht had endorsed note after note. Another brother-in-law, Roy Fielder, lost $26,000 it was reported.

Graper died while riding on an N.C.&St.L. train from Lexington to Memphis. His wife was with him at the time. He had been reading a newspaper and suddenly pitched forward. Physicians summoned when the train reached Jackson said death had been caused by a cerebral hemorrhage. The body was removed and sent back to Lexington for burial. This happened Sept. 11 last and two days later the funeral was held.

In the interim the board of directors of the bank called a meeting and the State Finance Department was asked to take charge. Examiners closed the bank.

Here Graper's grip on Henderson County had been taken away. He who had been its foremost citizen in terms of wealth and power was no more. The big fish in the little puddle had died and his silver scales fell from him. . . . [five lines unreadable]  . . .personality was withdrawn, people of Lexington were shocked and disgusted.

They held the funeral in the Methodist Church on the corner across from the Courthouse, and barely a hundred persons attended. The town knew no sorrow; its citizens were more interested just then in self-preservation. They realized very clearly now what a menace his complete control had been all along, and how it threatened to carry them down in the breaking.

Wild Rumors Follow His Death

Self-preservation is still the principal interest in Henderson County today. When the Post-Dispatch correspondent reached Lexington he could find few who were willing to talk about Graper's strange career. The shadow of a $350,000 indebtedness to be prorated among 112 families: the stringency brought through by closing of the bank with 700 depositors - these were the topics those interviewed were bound to discuss. These, and rumors.

There were men in the drug stores who vowed that Henry Graper did not die. They declared solemnly that he went off to South America and a wax dummy was buried in his place. There were others that asserted that he shot himself. Still others say that the evening of the day he died the bank directors hauled off all the $350,000 in cash from the bank in a truck. One man --- had picked up a $5 bill from the sidewalk in front of the bank next morning.

Such talk is illuminative. It indicates how startling were the facts; how many Henderson Countians are shrinking from the truth.

However, the bond signers have been seeking a loophole in their contract. A faction headed by F. N. Davis, Presiding Judge of the County Court, believes that it has found a way out.

As Judge Davis explained, it, there are two technical flaws in the bond issue. The measure floating the bonds was passed in 1920, through Graper's influence. According to Judge Davis, "The bond issue was presented to the voters as being a 5-1/2 per cent proposition. When Graper's bank bid in the bonds and resold them they went out at 6 per cent, one half of 1 per cent more interest than the voters had agreed to pay.

Repudiation of Bonds Suggested

"Further, it is a State law that no county may float bonds exceeding 10 per cent (with its previous indebtedness included) of the assessed property valuation of the county. As we understand it, the indebtedness of Henderson County prior to the 1920 road bond issue was $200,000. With $350,000 added it came to more than 10 per cent or the assessed valuation.

"Thus, for two reasons that the people of Henderson County would be legally justified in repudiating the $350,000 worth or road bonds as unauthorized and illegal. Steps are being taken with this end in view."

Judge Davis added that if the county had legally issued bonds exceeding 10 per cent of its assessed property valuation it must have passed the measure by a two-thirds majority. He avers the 1920 bond election was carried by only a simple majority, and that this is another point which will make the move for repudiation.

If the bond issue is invalidated, as Judge Davis and the surety bond signers hope it will be, then the purchasers of the bonds will have no claim on the county. The county, therefore, will have no claim against the citizens who signed the surety bond. The only losers will be the investors who bought Henderson County (Tenn.) road bonds. The question probably will be settled through a suit by the present bondholders in federal Court against the county. The Bank of Lexington, which under the depository agreement, was to pay the interest on the bonds, is in arrears for the last six months. About $26,500 in interest is due the bondholders as the regular Nov. 1 semiannual payment.

All Eyes Turn to the Widow

Next to a discussion of ways and means of dodging the surety bond, the most popular subject in Henderson County just now is Mrs. Lena H. Graper's attitude. Everyone seems to think that she, as the widow of the man who was responsible for the disappearance of its road fund, is ______ bound to see that the surety bond signers suffer no loss. She has not, however, shown any indication that this is her view of it in converting the $500,000 in life insurance Graper carried and keeping the $200,000 worth of securities he assigned to her from becoming involved in the liquidation of the bank's affairs. In his will Graper seemed to have had a premonition that he was bound to crash, for he stipulated various _________ which he had saved his own property, and had turned it over to her.

To give life to the morass of figures through which the bank examiners are wading in an effort to save enough from the wreck to pay depositors at least, it is necessary to return to Henry Graper. They all come back to talk of Henry Graper here, after they have discussed the disaster precipitated by his death.

I think Graper would "have pulled us out of this if he had lived," one man told the correspondent.

"I don't figure that Graper expected his end. I think he had some scheme up his sleeve to clear away that bad paper," said another.

"They're talking a lot about how dirty he did them, but he was the most resourceful man I ever saw," one banker explained. "I don't think he had any idea of leaving the folks here in the lurch."

"If Henry Graper had lived he'd have fixed it so we wouldn't lose anything."

It stlll persists. Magic Henry Graper!

Began as Restaurant Dishwasher

He began in Lexington as a dishwasher in the town's one restaurant, about 30 years ago: A raw country lad who had grown up near Wildersville, some miles down the short-line track, his start was humble, but he moved fast. Folks chuckled about his first step. He married May Fielder, whose family was well off. She was not as pretty as many other girls about, but the gossips said: "That young feller's got a head on him."

His first funds were gathered in modest trading. The watchers from the soap boxes and sugar barrel tops marked that he early took to reading books, and had his hair cut regularly. Presently he became friendly with Thetis Sims, who was running for Congress in the district. He helped Sims, and when the Tennessee solon won his seat Graper became Secretary to the new Congressman, That carried-him to a different world, and he acquired a polish that was to become part of his stock in trade back home.

After leaving Sims' employ Graper returned to Lexington and opened a bank, calling it the Citizens' Bank. He dabbled in politics from the first and evidently hit upon the idea of running the bank and the political genie together. The plan worked to a nicety.

His policy was never to refuse a loan. . . .

[An entire page of the St. Louis Post-Dispatch was reprinted; a continuation page seems not to have been available for the reprint in 1980.]

1924 photo captions

The $_____ home which Graper built for his second wife, a divorcee, at Lexington. The town people cut her and she moved to Memphis, where Graper established her at a handsome residence at 1833 North Parkway.

Mrs. Lena H. Graper
The widow of the banker to whom he had transferred his half-million-dollar estate and who is determined that none of it shall be involved in the liquidation of her husband's wrecked bank.

The Bank of Lexington where Graper carried on his operations. He had offices on the second floor, delegating to subordinates the routine work of the bank.

Henry C. Graper
The small town "financial wizard" who had his neighbors buffaloed until his sudden death, whereupon it developed that his wizardry may cost the people of henderson County $350,000 or so.

These photographs are owned by William L. Barry and are reproduced from Emily Davis and Brenda Kirk Fiddler, Henderson County, Tennessee A Pictorial History (Rose Publishing Co., Humboldt, TN, 1996.

A 1935 clipping in Imogene Oakley's Scrapbook

Henry E. Graper, Jr., Gets Control of Estate

Henry E. Graper, Jr., 23, of Memhis, son of the Lexington, Tenn., banker who died 10 years ago, won control over the $60,000 estate left by his father in a decision handed down by Chancellor R. B. Howell in Nashville recently. The estate, by investments, has grown to approximately $76,000, according to John P. Colton, Memphis attorney, who represents Graper.

The chancellor ordered the Fourth & First National Bank in Nashville, set up by the elder Graper as trustee, to turn over the estate to the son, although the elder Graper had sought to set up a trust fund for his son, who at the age of 13, became beneficiary of the insurance policies for $60,000.

The chancellor ruled that the will did not alter the status of the son as beneficiary, and that the trust fund provision of the will is invalid. Colton and Graper returned lately from Nashville where they attended the hearing. Young Graper lives at 2087 Courtland, Memphis. — Commercial Appeal.

See also I Remember (Henry C. Graper and John A. McCall), H. J. Bolen