Lancaster gazette. [volume] (Lancaster, Mass.) 1828-1830, 1830-02-23
MIscELLAN Eous.
From the Salem Observer.
swINDLlNG ON A GREAT SCALE.

wv h0sOf hOtCkOIOtCS 1du OCCdSIOH 10
notice, with severity, the management of
certain Banking institutions in New York.
but our own State has furnished US, with
two cases of Bank mismanagement, which
seem TO us as deserving of censure, as any
which we ever recorded.
A committee of our Legislature have
recently reported their examination of the
concerns of the Sutton and BeIchertown
Banks. Ofthe former they say, tina. the
capital stock required by the charter, was
to consist Of one hundred thousand dol
lars. gold or silver, to be paid in, one half
before October l, 1928, and the other half
before the first Of March, 1929, and no
money was to be loaned or discounts made
or bills issued until there should be fifty
thousand dollars in gold or silver actually
in the vault Of the Bank. On the Goth
Of September, 1928, the GOVERNOR ap-
pointed commissioners to examine the
specie, in the vault of the Bank, and on
the next day, the Sutton Bank borrowed
Of the City Bank in Boston. fifty thou
sand dollars in specie, for one day only,
and this specie was examined by the COM
missioners, and returned as the property
of the Bank, and a majority of the Sutton
Bank Directors made oath, that this spe-
cie aods paid IN by the Stockholders, for
their LIST instalment, and not for any other
purpose, and that the same specie s0as an
tended to remain in the Bank as part
of its capital. As soon as the commits
sioners finished their examination, the spe.
Gle was returned to the City Bank in Bos-
ton. The payment of the first instalment
was, in almost every instance, made in
the notes Of the stockholders. By an adj
ditional act ofthe Legislature, the time
for paying in the second instalment was
extended, ::but the payment of this was
made in the same manner as in the first
instalment. On the 18th of Sept. 1929,
the Directors were authorized to purchase
for the benefit Of the Bank, the shares Of
Mr.. David Wilkinson and others, amount
ing to seven hundred and fifteen, and
which were pledged for debt. Mr.. Sibley
and Mr.. Leland purchased them at differ
ent prices, from fre dollars to nineteen
dollars per share. At subsequent meet
ing of the Directors the Cashier was au-
thorized to convey these shares to Mr..
Sibley, at twenty dollars per share, on con-
dition, that he paid twenty-five per cent
on each share. Mr.. Sibley purchased
them, and gaze his note in payment. The
committee point out other instances Of a
violation of their charter, and imposition
on the publick, in the management Of
this Bank but we have not room to notice
them.
The Belchertown Bank was incorpora-
ted in 1925. As soon as the charter was
obtained, a negotiation was made with
the U. States Insurance Company in Bos-
ton, BY which this Company agreed to
take nine hundred and si1ty.fue shares.
In August, 1925, the Bank went into OPP
Grafton and majority Of the Directors
lived in Boston, where the concerns of the
Bank were principally managed. The
other Directors formed a distinct board at
Belchertown. In January, 1927, the
United States Insurance Company trans
ferred all their interest to Mr.. Ralph Hun
tington, John P. Rice, and others, and all
the books and property Of the Bank were
delivered to them. The next meeting Of
the Directors was held at Mr.. Hunting
toms store, in Boston, and Mr.. Huntington
was appointed general agent OF the Bank
to manage it, as he might think best. In
February, 1928, Mr.. Huntington sold
ninety thousand four hundred dollars OF
the stock to Mr.. Dickinson and Mr..
Strong, at an advance OF Ave per cent, and
received his pay therefor, from Mr.. Dick
enson the President of the Bank, BY TAX
ing note due from himself for eighty
seven thousand dollars, and other notes to
the amount Of the purchase money. all OF
which was the property of the Bank, ana
were in his hands as agent. On the re-
turn of Mr.. Dickinson and Strong, to Bel
chertown, they lodged with the Cashier
their notes for eighty-one thousand dol,
lars, and these made part Of the capital