The Sun.
London, England, 1853-03-09 00:00:00

example of the benefit, he might mention that a num-
ber of loans made on the security of the Government for
the purpose of carrying on improvements in the West
Indies and other parts, were on a recent, occasion chiefly
taken by insurance offices. (Hear, h4.r.) Thus funds
accumulated for the future benefit of the people became
most useful instruments of present advantage. It was im-
possible in taking that view of the matter to overlook the
responsibility of these gentlemen who undertook to manage
these institutions, and he should be glad if he could feel
certain that in every case those who undertook the manage-
ment or brought them into existence, felt the weight of
that responsibility. He should be satisfied if in all cases
these associations were started for the bond fide objects
which they professed, and not, as he suspected in many
instances, as a mere cover for fraud of a most gross de-
scription. (Hear, hear.) With regard to joint stock banks
their liabilities were of an entirely different description.
If you were dissatisfied with the bank you could close your
account, and even if it failed and great loss was inflicted,
that loss was momentary and known at the time. With
fire insurance companies also, if you pleased, you could
change your policy at any time. But with regard to life
insurance it was a totally different thing. The premiums
were paid year after year, and whatever doubts a man
might have, he was not in the same independent position.
Therefore he looked upon these institutions much more as
a sacred trust for the future, than as the means of mercan-
tile operations for the present. He looked upon them as a
sacred trust, because present payment was to secure future
benefit, and because individuals, actuated by the best
feelings of human nature, were induced to make great sa-
crifices and to exercise great self-denial in order to provide
for those who followed them. (Hear, hear.) For this
reason he thought these institutions fairly taken out of the
strict category of commercial institutions • and if they
professed in any way to govern joint stock banks and joint
stock companies, they were doubly justified in interfering
with associations whose operations were future and not
immediate. But whatever might be the difference of opi-
nion on the question of interference, on which he knew the
honourable member for Montrose felt strongly, and in
which feeling he (Mr. Wilson) very much participated, it
was not a question whether they should interfere or not.
They had interfered. (Hear, hear.) They had interfered
soffar as to make the public rely on that interference. They
had become responsible to a certain extent for these in-
surances, because they had given a certain amount of Par-
liamentary sanction; and having done that it did not lie with
the house to entertain the question of interference or non-
interference. Having interfered, it was their duty to see
that that interference was made as effectual for the pur-
pose as possible, and most of all that, under the shadow of
that interference, gross frauds were not perpetrated on the
public. (Hear, hear.) By the Joint Stock Companies
Act of 1844, it was provided these institutions should be
reg
istered like other joint-stock companies, and that each
company should be obliged to return to the Registry-office
an annual balance-sheet, which should prove the financial
condition of the company. He extremely regretted to say,
and that was the ground on which the Government felt
bound to take other steps, that both those provisions had
been grossly violated and abused. (Hear, hear.) He was
bound to say that in many cases the registration had been
in name and not in fact. The act required that the deed
of the company should be registered, and that before that
took place it should be signed by a certain proportion of
the partners for a certain proportion of the capital. But
it was a notorious fact, and that fact would be elicited in
the committee in a remarkable degree, that the greatest
frauds and deceits were committed under this registration.
Two or three persons getting up a company found little
difficulty in procuring thirty or forty persons to put their
names down for enormous amounts, who, when inquiries
were made, were either not to be met with, or were dis-
covered te be men of no responsibility whatever. (Hear,
hear.) With regard to the working of that law, if the
house would permit him, he would read a short extract
from the report of the assistant-registrar of joint stock
companies, and if they would listen to it they would be
convinced at once that the law could not be left in its pre-
sent state. " This act had not been long in operation
when public attention was forcibly arrested by the
discovery of a series of frauds, which, when con-
trasted with the station and resources of the indivi-
duals concerned in them, may be described as of un-
exampled magnitude, and to the imperfection of a state
of the law under which such frauds were possible.
Some half-dozen adventurers, any one of whom in his
individual capacity would have found it difficult to obtain
credit to the most limited extent, boldly announced to the
world the formation of an imaginary assurance company
with a capital of 1,000,000/. ; and, constituting themselves
into a board of direction, and assuming • all the outward
characteristics of a wealthy and flourishing corporation,
contrived, by holding out temporary inducements to the
ignorant and unwary, and professing to conduct business
on unusually liberal terms, to defraud the public in the
course of about four years to the extent of upwards of
200,0001. There was nothing to which the public generally
had access from which it could be discovered that this was
not a company properly constituted, and possessing the
capital to which it laid claim. Only a searching investiga-
tion such as few persons would think of undertaking, and
which was not unattended with personal risk (for actions of
damage were in this case brought against the first de-
nouncers of the fraud, who might thus have been seriously
injured, if not ruined, before they had succeeded in bring-
ing it fully to light), could make it appear that there was
nothing of a company but the name—no capital but the
contributions of the dupes themselves. So it was, how-
ever ; four men, personally without credit, character, or
education—with no resources but boldness and cunning—
succeeded in making the world believe for four years that
they represented a company composed of some hundreds
of partners, and that they had the command of a capital
of 1,000,0001. sterling, simply because, there being no
ready means of putting the truth of such representa-
tions to the test, , the public had got very much into
the habit of taking them for granted, or, at all events,
of relying upon very slight presumptions in their favour."
(Hear.) He begged to say in passing that the sanction
of the act of Parliament had had very much to do with
creating that confidence. (Hear, hear, hear.) " A con-
sideration of the class of persons who suffered by this
fraud, and who would be most likely to suffer by any
similar fraud in time to come, beinc, chiefly persons of very
moderate income, who had been lured by the prospect of
an advantageous investment of their savings, and to whom,
therefore, the bursting of the bubble disclosed the fact of
their ruin, had much effect in stimulating the Legislature
to devise some means by which the perpetration of similar
frauds might be prevented for the time to come. A select
committee of the House of Commons was appointed in 1841
to inquire into the law respecting joint-stock companies,
with a view to the greater security of the public, and con-
tinued its investigations through the years 1842, 1843, and
1844. The committee began by ascertaining the means by
which the fraud just referred to had been committed, then
passed from it to other cases of proved or suspected fraud
of recent occurrence, so as to bring, as nearly as possible,
into one point the whole capacity forbeing turned to fraudu-
lent purposes inherent in the system of joint-stock com-
panies ; then, extending their inquiries generally to the re-
gulations under which; as a question of public policy, such
companies ought to be placed with a view to the security of
the shareholders as well as of the public, they finally agreed
upon & report, upon the recommendations contained in which
was founded the act now in force for the regulation of
joint-stock companies, which was proposed to the House
of Commons by the President of the Board of Trade, and
received the Royal assent on the sth of September, 1844."
It was under the Joint Companies Act that these evils
and abuses had taken place,and he was afraid that the inves-
tigations of the committee would disclose in too many cases
similar frauds. Another security provided by the act for
the solvency of these companies—the production, namely,
of an annual balance-sheet, had been as much evaded as the
other regulations laid down by Parliament. He believed.
that no man in the house or out of the house would under-
take to inform the public in what state the affairs of these
companies were, judging from the balance-sheets which they
exhibited. The fact was, that accounts might be presented
in so many forms and shapes that it was impossible for the
mind to arrive at any definite conclusion upon them. It
appeared that in twenty-five of these insurance offices the
receipts for the last year amounted to the sum of 462,0001.
while the cost of management, according to their own
showing, reached to 387,0001., leaving a balance of only
75,000/7 out of an income of nearly half a million sterling.
(Hear, hear.) He thought the house would agree that, in
the face of startling facts of this kind, it would be criminal
in the highest degree for the Government of this country
to stand still with folded arms, and not attempt at least
to devise a remedy. (Cheers.) At the same time he was
anxious not to excite unnecessary alarm in the public
mind. He had no doubt that what were called the
"respectable" assurance offices were in a highly sound
and prosperous condition. It was well known that those
offices which submitted in an intelligible form their ac-
counts to their shareholders were, from the improved
tenure of life which had prevailed during the last fifty
years, and the advantages afforded by their tables, among
the most profitable of commercial undertakings. But he
wished the house to understand that these were the excep-
tions, and not the rule. He was anxious, while this in-
quiry was pending, that the public should not relax in
their habits of prudence, but he wished also that they
should learn to distinguish between the principles which
governed good and safe offices, and those on which bad
and unsafe offices were founded. All the Government
wanted was that the securities taken should be securities
of an absolute and living character, and not mere shams
and delusions. It had been proposed with great reason
that the insurance companies should be subjected like
other joint stock companies, to a test of solvency, by re-
quiring them to pay up a portion of their capital before
they were allowed to be registered. He was sorry to say
that so numerous had been the institutions of a mitsitv
room description which had sprung up of late, and so
palpable were the frauds which they practised to en-
trap the unwary, that they deserved to be characterised
as swindling establishments. He would call the atten-
tion of the house to the multiplicity of these institu-
tions. Since the Joint-Stock Companies Act passed,
335 new insurance offices were projected, of which 149
were actually, founded, and 90 had ceased to carry on
business ; so that out of 335 projected, there were only 59
in existence. In the last year—for every year appeared to
make matters worse—there were 72 now companies pro-
jected, 18 founded, and 12 had ceased to exist, leaving only
six out of 72 which had been projected. For the reasons
which he had stated, he thought that the house would feel
satisfied that this state of things could not go on without
inquiry, and he trusted that measures would be taken by
which the existing act might be carried out, and such other
provisions introduced as Parliament in its wisdom might
think necessary. (Hear, hear.)
Mr. WHALLEY expressed the satisfaction which lie
had felt at hearing the statement of 'the hon. gentleman,
and trusted that the supervision of the Legislature would
be extended to benefit societies as well as insurance asso-
ciations. The poorer classes of society, he begged to assure
the Government, required protection, even more than the
middle classes from the schemes of designing adventurers.
He had had bitter experience in that kart of the country
in which he resided, of the utter demorThsation which had
a
been occasioned by the failure of benefit societies. Within
a circuit of something like ten miles, comprising a popula-
tinoan
tohf
riftnearly
hi
er,hoooa d
beeninhabitants,
created
theamo
ng habitsofthe l pa ib- touu
ri l e n
ncge
population had been seriously endangered, because the
present law had failed to insure to them the provision
which they believed the
age. The same
principle .
societies, and all other cieiesofacthe
the kind
sickness
ind,andheanl
ht old
o pet
the attention of the ihadoperatedt ml
in the case of burial
Governmentt. would be seriously di
routed to this important subject.
Mr. FORSTER observed that Parliament had already
i;,iertenttly, it must
interfered in the regulation of joint-stock
great of attention to this sun;
had done harm by its interference, ;oeer companies, and
go further.
either undo what had been done
abuses which
Having paid a'
become acquainted with a good many of the ague:, he Ilad
for bringing this matter under the
were going on under the present system ; and ho
memberthat the f countryor
Westbury
that the vigilance
aroused upon a subject attention
.of.tlahnecheoolsuf-seas.
1844 had greatly aggravatedindebtedthe the evils which it was de_
were undoubtedly great difficulties

surrounding the subject ; but it would be the business of
the committee to inquire into the whole question, and see
what remedy could be applied. It was clear, at any rate,
that if matters were allowed to go as they were doing, the
public would be involved in most serious losses. As there
was to be an inquiry, he would not prejudge the case, but
wait for the report of the committee. In, the meantime,
however, he hoped that the able and clear statement
which the hon. gentleman had made, to the accuracy of
which he could himself bear testimony, would go forth to
the public, and arrest the evil which was in progress.
' Mr. BROTHERTON said that, having moved for the
returns to which the hon. member for Westbury had ad-
verted, he might be permitted to express his satisfaction
at the course proposed to be taken by the Government,
and he was sure that it would give equal satisfaction to
all the solvent institutions in the country.
Mr. 9.EACH thought that legislation on this subject
was abitoluiely necessary, and that no subject of greater
."social importance could come under the consideration) of
Parliament.

Mr. HUME never had any confidence in the act of 1844;
And if people did not take care of themselves, what could
acts of Parliament do for them ? To his mind, nothing
could be more satisfactory than the statement of his hon.
friend, that out of 335 insurance companies projected since
that act, only 55 now remained. The same erroneous
principle had been applied to banking companies, and the
day was not far distant when the country would appreciate
at its true value that course of legislation. His hon. friend
saw that Parliament had done wrong, and he thought he
was quite right to " try back." As to balance-sheets, they
were of no use. If he were disposed to be a rogue, he
would make out as fair a balance-sheet as any man could
show in the kingdom. The question upon a balance-sheet
was, whether the account presented was a true account.
He did not know anything that was more material to the
welfare of the community than a well-established insurance
office ; but, after all, every man must look after his own
affairs, for they could not be safely left to any one else.
Mr. T. CHAMBERS doubted whether the course pro-
posed by the honourable gentleman the member for
Westbury was, upon the whole, one which would se-
cure the advantages which he hoped to gain by it.
It appeared to him (Mr.. Chambers) that no amend-
ment of an act of Parliament would render personal
care and vigilance unnecessary. Balance-sheets only
showed the receipts and expenditure for the year ;
they did not show, and they ought not to show, the value
of a company's assets, the calculation of which must be
carefully prepared by gentlemen who understood the
question. Such an estimate ought not to be required from
a company more than once in five years, because it would
not be fair that the expense of making a calculation should
be thrown upon them every year. It was said that the
public did not take care of themselves ; but it appeared to
him that the facts stated by the honourable gentleman
proved that they knew very well how to do so. The insur-
ance offices of Great Britain, without Ireland, had an in-
come of nearly five millions sterling, and the fact of their
existence showed that the public had confidence in
them, and that such confidence was well bestowed. All
their liabilities were met ; and, as out of 335 projected
companies only 59 were now in existence, he did not see
that there was any ground for saying that the public did
not know how to take care of themselves. For these rea-
sons, though he should not oppose the motion, he still
doubted whether the advantages which were expected
would be secured.

Mr. SOTHERON thanked the honourable member for
Westbury for having brought this subject before the
house. He was unconnected with any assurance office
whatever, but in the course of the inquiries which had
been granted by the house, at his instance, during the last
three or four years, on the subject of benefit societies, he
had occasion to examine the actuaries of some of the most
respectable assurance offices in London, and he was sure
that it was the wish of all of them that some such inquiry
as that now proposed should be instituted. He believed that
at this moment the capital represented by insurance com-
panies was estimated at 350,000,0001., and this was there-
fore an interest of sufficient importance to justify Parlia-
ment in dealing with it specially. The question was
whether, comparing the assets of the different insurance
companies with their liabilities, their affairs would be in a
solvent state if wound up, and this could not be ascertained
in the present state of the law.
The motion was then agreed to.
THE EASTER HOLIDAYS.

Lord JOHN RUSSELL gave notice that on Friday, the
18th inst. he should move the adjournment of the house
for the Easter holidays, from that day until Monday, the
4th of April and he should at the same time propose that
on the Thursdays after Easter orders of the day take pre-
cedence of motions.

On the motion of Mr. MUNTZ, the following select
committee was nominated to inquire into the seizure of
the ship Novelle :—Mr. Muntz, Lord Stanley, Sir F.
Baring, Mr. Spooner, Mr. Cowper, Mr. Archibald Histie,
Mr. Ker Seymer, Mr. Price, and Captain Boldero.
Mr. WHALLEY, who had given notice of a motion to
bring under the notice of the house the petition of Samuel
Massey Cross, relative to the capture by pirates of the ship
Violet, in October, 1851, stated that as the Government
had promised to take the subject into consideration, he
would postpone his motion until this day week.
On the motion of Mr. MUNTZ, a select committee was
appointed to inquire if the reporters and strangers may be
allowed to remain in the house during divisions, excepting
on special occasions, and if possible to devise some plan by
which the time allowed between the divisions being de-
clared and the doors being closed shall be correctly and
satisfactorily determined.

On the motion of Mr. W. PATTEN (in the absence of
Mr. Labonchere) it was ordered that the Speaker do not
issue his warrant for a new writ for Kingston-upon-Hull,
before Tuesday, the 12th April.
On the motion of Mr. BROTHERTON (in the absence
of Mr. Tufnell) it was ordered that the minutes of evi-
dence taken before the Tavistock Election Committee, and
the minutes of proceedings, be laid before the house. _

On the motion of Mr.' SOT-IP:RON (in the absence of
Mr. Bramston) it was ordered that the evidence taken
before the Chatham Election Committee be printed, and
also that the Speaker do not issue his warrant for a new
writ for the borough until the 11th of April.
The Designs Act Extension Bill was read a third time
and passed.
CATHEDRAL APPOINTMENTS BILL.
On the question that the house resolve itself into com-
mittee on this bill,

Mr. SPOONER expressed a hope that the committee
would be postponed, as the hon. member for Oxford had
some amendments to propose.
Mr. SIDNEY HERBERT said he had seen the hon.
member, and had made an alteration which met his appro-
val. It was merely a suspension act.
Mr.EWART complained that while it was the intention
of Parliament to reduce the incomes of deans to 1,0001. a
year, some of the deans on the new foundation were enjoy-
ing 2,0001., and in some cases the canons were enjoying
more than the deans. He thought the subject well deserv-
ing of the attention of the Ecclesiastical Commissioners,
and that some steps ong,htto be taken to prevent the inten-
tions of the Legislature beingfrastrated.
The house then went into committee, the clauses were
agreed to, and the report was ordered to be received to-
morrow.

On the motion of Mr. WILSON the Indemnity Bill
was read a second time,-and ordered to be committed to-
morrow.

Mr. CARD WELL brought in the Pilotage Bill, which
was read a first time.

Tho house then adjourned at ten o'clock.

SPORTING INTELLIGENCE.

SPORTING NOTES. —No. CCCLXXXVII.
SALISBURY MEETING.
At the time I wrote my observations on yesterday's
races at Doncaster, it was pretty generally understood
that Broughton would represent Cunningham's stable
for the Trial Stakes, and, consequently, I gave him
as the winner. Too late, however, for publication,
I discovered that they had transferred their affections to
his stable companion, Snowdon Dunhill, who won in
the easiest of canters. Audubon, who ran fifth and last,
was not placed there on his merits, but by his very lusty
condition.

The Steeplechase proved the truth of the Liverpool
running—Peter Simple, notwithstanding extra weight,
again defeating Miss Mowbray easily. She, in her turn,
disposed of the remainder of the field without any
trouble.

The Hopeful was won by a very smart filly of Mr,
Hawkes's, by Melbourne, out of Punniar, y'clept Mid.
summer. In my opinion an improving and very usefli
animal.

Tom Taylor's Orlando colt is about the best two years
old produce in his stable this year.
There is only one stake of any importance to be de-
cided to-morrow at Salisbury that is entered for at the
present time—that relic of past times, the City Bowl,
value 18 sovs. in specie, and 12 from the fund, added to
a sweepstakes of 5 sovs. each. The City Members' Plate
and Her Majesty's Guineas not closing and naming until
this evening.
Both the Triennials, in all probability, will terminate
in walks over.

The only stake demanding my attention is the Wilt-
shire Stakes, of 25 sous. each, 15 ft, &c. (two miles.)
Cariboo does not run. Buckthorn at Bst 21b is not be-
yond the 'pale of victory, but possibly he may be re-
served :for the Steward's Plate on the following day.
The Knight of the Shire has been the only horse backed
to any extent ; and at 7st 121 b, with Nat up, ought to
finish about the mark. Benita, I fancy, will remain at
home. The same remark will apply to Defiance and
Corybantes. Eulogist, at sst 111 b, has a few pounds too
much to carry ; and Tavistock, at Sat 91b, seems to me
to be in the same predicament. Jack the Giant Killer,
at 4lbs less than the preceding, receiving 2 stones and
a half of the Knight of the Shire, will probably just beat
the latter ; and Postulent, at 61bs less than Jack, I have
an idea will beat them both. Lampedo, I presume, has
better things in view, and will remain in his stable. If
rplace POSTULANT first, Jack the Giant Killer second,
and Knight of the Shire third, I think I shall just about
anticipate the result.
I shall touch upon Friday's races to-morrow.
KIRKHAM STEEPLECHASES.—These steeplechases come
off to-morrow. Ploughboy, Little Charley, and Daphne
have arrived for the Grand Handicap ; and Vainhope,
Talisman, and one of Osborne's, are reported en route.
The fields for the Innkeeper's Plate and Free Handi-
cap Sweepstakes will be tolerably good, as the list
of arrivals and the horses expected, include the follow-
ing :—Johnny Barrie, Pride of the North, Tom of Tuam,
Uncle Tom, Crabbs, Freshwater, Harmony, Lady Wil-
ton, Royal Blue, Nelly Brown, Miss Purden, and Widow
Machree.

WILTSHIRE STAKES (SALISBURT).—The starting of
Postulant for this stake is somewhat doubtful ; there•
fore, having received a first rate account of Tavistock
from head quarters, he must be taken in addition as a
likely occupant of the post of honour.
THE SPIRIT OF THE TURF.

BETTING AT MANCHESTER.—TUESDAY.
DONCASTER HANDICAP.
3to 1 agst Ethelbert (taken).
6to 1 agst Llanforda (taken).
10 to 1 agst St. Andrew (taken).
16 to 1 agst Burndale (taken).
METROPOLITAN HANDICAP.
7to 1 agst Contentment (taken).
12 to 1 agst Lampedo (taken).
20 to 1 agst Pug Orrock (taken).
26 to 1 agst Snowdon Dunhill (taken).
20 to 1 agst Defiance (taken).
25 to 1 agst Redmond O'Hanlon.