The Sun.
London, England, 1851-10-21 00:00:00

with whose property they are entrusted, they are
doubly bound to protect. What legal indemnification
can they hold against the chances of insolvency on
the part of either the so-called merchant or his
agent abroad ? In addition to all that they are some-
times directly, often openly, parties to a whole-
sale fraud upon the mercantile world, inasmuch
as that money thus raised acts as a sti-
mulus to the false credit of the merchant, who of
course passes the amount through his banker's hands,
but too glad to make such a display of means. The
unwary is thus decoyed into selling him goods upon
credit, through references to, and the good word of,
his banker, who is blinded by the amount of his ac-
count ;or his broker, who may be on the look-out for
another parcel of goods, from the net proceeds of
which to stop the gap caused by a loss on some pre-
viously ill-considered and disadvantageously-pur-
chased shipment, or local speculation, in which the
broker, by some übiquitous power, is both buyer and
seller. _

----
A second illustration of the abuse may be traced in

the shipment of British manufactures bought upon
credit, through the aforesaid references, which are
shipped to India, shipping documents being accom-
panied by orders to ship, on receipt thereof, pro-
duce of an amount equal to their "salted" value—
this, with the facilities afforded by the native Ban-
yans and local banks, is easily managed (8 to 12 per
cent. being nothing to M., M., and Co. for interest in
advance). Hence the immediate shipment of pro-
duce, for which shipping documents are dispatched
overland. These find their way to Messrs. S., S., and
Co., who in return give their acceptance for this " pig
in a poke" to Messrs. M., M., and Co., which, under
discount, or nearly so, pens the acceptance given for
British manufactures, it being " desirable," i❑ the first
or second instance, that they should do promptly, and
then perhaps they may get an occasional renewal of
their acceptance for subsequent purchases, in order
that they may, what they call, " trade" with the
money, that is, employ it in any hazardous speculation
of tempting prospects that may have been put before
them by their wily broker, or engendered in the half-
matured brain of M., M., and Co., until the London,

Manchester, or Glasgow warhouseman finds himself
where most people do who follow a false light—in the
mire. Here, then, we have the fertile sources of
" panic," inasmuch as that both operations glut the
home and foreign markets with goods heavily embar-
rassed, which must be sold at some price " to keep
the pot boiling."
A third and yet more serious evil is that arising
from produce shipped in India for England, without
either money or goods having been sent there for that
purpose. This is done annually to the extent of many
millions sterling. The produce thus shipped may be
traced in publications issued by her MAJESTY'S Cll3-
tOlllll as consigned " to order," which means simply
that the policy and bill of lading for the same were
by, say Messrs. EITORIIISS, LucKIsALL, and Co.,
" hypothecated"—" pledged" is too coarse for Orien-
tal ears—to one of the moneyed houses, as a collateral

security to their draft upon Messrs. M., M., and Co.
for a certain sum, which, i❑ fact, is neither more nor
less than an " advance" upon the shipment.
_

Now no person possessing any knowledge of the
mercantile world, and the absolute necessity for some
medium of exchange, could object to a party abroad
drawing upon another in England or elsewhere, pro-
vided always that the party accepting had a specific
and valuable consideration belonging to the drawer
in his hands. That, however, is not the
case in this instance, though prima facie

it would appear to be so—the " consideration" in fact
being attached to the draft—nor can possession of
the former be had until the latter shall have been paid.
What is to be done ? Ob, nothing, as Messrs. M., M.,
and Co. would say ; just write in red ink across the
bill when presented for acceptance the admission of
your interest or agency in the shape of those potential
letters, figures and words B. P. No. 3,656 (any thing
under 2,500 looks " slow "), " accepted payable on
production of shipping documents herein named at
Messrs. BULLION and Co,, London, Ist January,

852," finishing with your " usual signature " (in

black or blue ink), and then you may say, as poor
SHERIDAN used to do with his bills, " Thank good-
nos, that's off my mind," at least, until the arrival of
the ship—when the holders of the bill will send you a
polite message, that as the good ship Charlotte,
BAILER, from Calcutta has arrived in the Downs,
having on board the security for your acceptance No.
3,656, they wish to know whether you will pay the
amount thereof under discount, or they shall ware-
, house the goods in their own name until the ma-
turity of the bill, which generally has two months to
run. If Messrs. AL, M., and Co. be in good feather
with their brokers, Messrs. S., S., and Co., they will
answer off-hand—" Oh ! just send in the draft and
documents to-morrow with a memorandum of the
amount, less the discount " ("Bank rate," mind, as
though from the abundance of their idle capital to
allow an infinitesimal fraction above that would
break their hearts), " and we will give you a cheque
for it." So far, apparently, all appears en regle. In
the meantime, perhaps, "on 'Change," our mer-
chants arrange with their brokers for some
of the " stiff " to an extent varying according
to status with them, or the applicants being

" flush" or "short" at their bankers, with which to
charge their vade mecum, the "crucible" whence, by
noon of the succeeding day, may be seen issuing the
bright product of their alchemy—gold. Away with
it to the bankers :—that excitement over, the scene
wears the aspect of a calm, calculating house of
business. The document and draft are presented—
the latter paid, less " Bank rate," of course. Messrs.
M., M., and Co. feel ala ROTHSCHILD. The late
holders of the bill believe them to be so, and ac-
cordingly advise their Calcutta friends to buy, par
preference, bills upon them. The next matter is to
see the goods, because the broker has neither the will
nor the means to be under advances of " cash" for
other people's business, which he must at maturity of
his acceptance if the goods were not realised by that
time, or the draft renewed—a courtesy he not always
cares to extend, having once got the goods into his
clutches, preferring to save his name for a new trans-
action to bolstering up an old one. In this virtuous
determination Messrs. M., M., and Co. join, having
other transactions coming forward, the proceeds
whereof they will require to " anticipate" in like
manner—the result of that decision being a sacrifice
of the shipper's interest, be be some luckless " na-
tive," who may have vanished upon receipt of a
redraft of excess of advance over nett proceeds—be
they Messrs. H., L., and Co., who are debited with
the loss on account current, pending a clear remit-
tance to credit thereof—or be they Messrs. M., M.,
and Co., who coolly carry the amount, or figures
representing it, to " profit and loss account."
There is a fourth " dodge," of which Messrs, M., M.,
and Co., in the plenitude of their mischievous power,
might have availed themselves—that of buying
goods on credit in this country for shipment to
India, drawing upon the latter
,place against them,
just reversing the last operation, except that money
realised in India upon England, is mostly either paid
to the shipper, native, or European, as an advance,
or if shipped, by and on account of Messrs. H., L., and
Co. to their " Banyan," who knows sufficient English
to understand that " short reckonings make long
friends." The usance in this case is 60 days' sight
instead of six months as, upon England, ergo, the
consignee must pay the draft long before even the
ship arrives. These statements are true ; let the
sceptical reader but turn to the columns of our pro-
verbially accurate contemporary, the Times of 1846-
47, and he will find there, in the smooth language of
an accountant, many items that took their rise from

similar sources.
us attempt to prescribe a remedy. In the first, se-
cond, and third instances, the brokers who lend
Having stated a few of the most glaring abuses, let
themselves to such surreptitious methods of obtaining
business should be scouted by their more respectable
brethren, and especially by those merchants who
import produce and hold the same unencumbered
until a remunerating exchange can be effected, goods
for money, which they have a just right to, and with
wholesome markets would realise, having, through
their agents abroad, given money for goods. There
are other abettors to the literal fraud practised in the
third instance, the large Calcutta houses and the
Honourable East India Company, who both (though
the latter may not have done so within the last six
months) make exessive advances upon shipments of
produce to this country. The latter, we conceive,
have no right to interfere with the mob; 'llarket of