Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1832-10-23
POLITICAL.
from the Globe i

THE VETO AND THE BANKING. VII.
In our last number we showed how, the origin Of the
Bank, unto OF peculaois monopoiZcd the stock and by
the votes of the fictitious stockholders iorned Board Of
Directors, which they knew would promote their inte-
rested views.
We pointed out how by the discount or no,es ,noo
pledges of stock they evaded the payment of their install
mens and threw upon the government and stockholders
the expense otimporng specie make up the deficiency
which was caused by their default.
iheSe measures were but preparatory TO the magn6-
cent plans of speculation which the projectors of these
schemes had in view The grand object was TO raise the
price of stock and make prncey fortunes by selling that
which they had covertly subscribed well as hy bving
and selling that which had been subscribed hy others
In Suy' isl1 after all the nstamens had been paid
or at least become due resolution adopted autbo
fiZng discounts generally upon pledges ofstock.
In August, resolution adopted authorizing di.
counts on bank shares OF 800 at 25 with an endorcr
who was held responsible only for the 25 This
endorsement rendered nominal bv an excbanoa Of
names among the spectators who endorsed for each obe
On the aOth September, resolution was adopted au-
thorzng the President and Cashier renew these stock
notes without the Interference of the Board of Directors
On The 9th November, 1918, the President and Cashier
were authorized to substitute the note and hvpotheca
eg oil ue person to whom the stock may be transferred
ana on which loans par have been made by this Bank
FMS system was admirably adapted TO facilitate specu-
laions in stock BY discounts upon pledges of stock
large portion OF the nstamen.s had been paid by the
cuators in their They were empowered N huv
more stock by being thus enabled TO raise the mean. 20
pay rtout of tho pledge of the stock itself By the
renewal oil these stock notes. they able retain the
stock until measures taken raise its price in the
market BY the regulation authorizing the transfer of
tO
Die them to sell II without paying of the stock and
pocket the advance
In the mean time, all possible devices were resortcd to-
Tor The purpose OF easing the price of the stock To
create demand for it abroad the Board on the 2Sh No
vember lSlG, adopted the following resolution viz.
"ReSo'0ed, That it is expeiienl at this fine 10 cstab
ish agency i'll England the payment of The dividend.
on such portion of the capital stock this Bank as NAV
be hed by persons resdngin Europe; and that John
gean Esq, he instructed TO make such arrangements for
and expense IF The Bank"
Thus, for the purpose of bringing foreigners into COM
petition the buying OF stocks, did the spectators throw
upon the Bank the whole risk and expense of transmitting
the dividends of foreign stockholders an agent in Lon
don. This arrangement continued for many wears
and Mr. Chevcs in his exposition 10 the sockholdcr, in
1922 complained of ''a very Instantaneous and
burthensome engagement on The part of the Bank"
which il then in good faith bound 10 continue in
relation TO at least $I179O0O of its stock then held by
foreigners.
Another device was, to declare high diuidends which
subsequent disclosures show TO have been false. They
declared their nett profits for the fist six months ending
in July 1917 TO be s 02 S73 49, and divided CLIO per
cent amounting 10 100000, leaving surplus of S73
40 At the end Of the first year they declared their nc
profit Tor the last six months have been 81 ZIG
and divided tour per cent amounting TO 81 400 ,000 TAX
ing part of the surplus of the preceding quarter and eav
ing of that s502 990 %.
Such profits, at that time, obviously impossible
During the first six months 50 800 900 of the stock had not
been paid in. Seven millions were in United States FIVE
per cent stocks which could yield but FIVE per cent 3d.
23iS27 SO in United States stocks subscribed as ca
pta which could not yield per cent and SO 22I
267 SO in stock noies, Welding only six per cont
These added together make S35 256 O05 81 being
than the whole stock of the Bank IL woul be diff
fcult to show how such profit reported could be
made out OF such a concern.
Its capital remained in the condition during the
next six months, ending Jam Is 1918, except that the
additional S9SO0000 paid in 1861, 1872 IS Of in 20.
vernment stocks and largo portion Of the balance in
stock mates Yet, The dividend declared for this SIX months
was four per cent!
IL IS not easy to sec with the lights afforded US, how
these and subsequent dividends were got up but enough
has been disclosed 10 show that they Fraudulent
Thus, during the first six months there paid for the
expenses oil the Commissioners who superintendent the
subscription, $40 0SO SO
For hAluTcs, 39,062 80