The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-02-22
The Senator continues. in relation to the Boston

4 IL Is wei Known tndt tHefc were three other
banks selected In the eiiy OF Boston as repositories
1 | aude to the Franklin, the Hancock, and the Com
monwealh Bank And where are these institutions
nowl The laIe public journals have told their
4 fate.
!" perfectly true that irresponsible institutions
trembling and falling banks may be for time sus
tanned by foreign aid An individual who, by over
trading and extravaganza senslbiy feels the heavy
/ nand 0i embarrassment, may for a time be relieved
4 by The inierpoSton OF friend and 1 am free 10
admit that these three selected banks might and pro-
baby dad, receive temporary relief from the public
dep91s1ies. They are the very class Of banks that
would receive aid and support through the agency
1 OF the government funds. But thai support would
be only tor time. IL would only put of the evil
day That day Of reckoning must come. II has
ALREADY come and their story Is matter of history
would ask the honorable Senator from Virginia
whether these the kind Of State institutions
| which he would wish To favor whether these are
the banks he would wish To benefit by his amend
ment I"
II is not such banks as these that the Honorable
Senator from Virginia aeould rish 10 farorn His
plan proposes the selection ONO bank whatever, as
matter Of favor 10 it, The selections are confined
solelyto The actual requirements and convenience
ofthe Treasury Department. And when banks are
required for those purposes he would select such as
the Merchants Bank. He would prohibit the selcc-
ton Of any bank for any 0they purpose rhaterer.
The Senator has omitted one Of the banks selected
in Boston The two banks selected originally appear
to have been the Merchants and Commonwealth
After the passage Of the act Of June 1886 there were
three others selected for the purpose, il has been
stated, Of holding lbe surplus viz The Hancock,
Fulton, and Franklin the two former with capitals
Of $500, 000 and The latter Of $4,000 only. II has
been stated that those three banks selected Gall
of which believe are discredied and the APP
plication OF an old bank in high standing, with
capital of nearly millions of dollars at the
time rejected matter Of surprise at the time
the Franklin Bank selected, that it should have
been The small capital had, gave Il that diminu-
tive character among most Of the other banks in the
place, seemed to reflect dscredit on the cha
racter fthe government by selecting il as one Of its
| fiscal agents.
or this bank, the Senator thus speaks,
"The Franklin Bank, as ! have stated was one
of the selected banks, and did receive portion OF
the public money in deposite; but am happy to in
| form the Senate that through the vigilance Of the
| head of the Treasury Department moi dollar will
be eventually lost My present object Is TO show that
il is not always safe TO rely upon the official
of these institutions This bank was selected by The
Secretary from its presumed condition, as exhibited
by its official returns, as well as by the force Of pub
4 lie sentiment"
Iapprehend, that the lack of |" vigilance" of udg-
inert or something else which led TO the selection of
this bank will be more loudly condemned, than the
/ FlSilduCC mat VIII PiSNSht airy uhihnate 1852
will be applauded when the following facts are
known taken from the report Of Joint special
committee Of the Massachusetts Legislature, appoint
ed to examine into the doings of the Franklin Bank,
and hear the bank thereon" &c.
Before giving the quotations from that report, I
will introduce the following from Senator Hubbard's
speech:
| IMr CLAY here inquired the connection there was
between the Secretary of the Treasury and this Off
Ger of the bankl l will Mr.. President, with great
| pleasure, answer the inquiry made by the Senator
| from Kentucky, as have no doubt The answer will
gire him great personal satisfaction The cashier Of
the Franklin Bank at the time these monstrous
frauds were committed and these gross impoSons
were pracsed, was no more related 10 or connected
iriH the Secretary Of the Treasury than he was with
the Senator himself II is perfectly true, that bro
therin-aw Of the Secretary had been since appoint
ed tothe office of cashier of that institution but he
| continued in that Office for only period of two
months, when he probably determined that regard
10 his own reputation, should induce dissolution of
all his connection with that bank.
The person alluded to in the above as The brother
in-law of the Secretary of the Treasury has been
stated was transferred from the Custom Fl use in
Boston to this Bank and of him the report thus
speaks:
On the 18th day of February, 1887, Edmund r.
Bannei made cashier of the hank in the place of
Hathorne, in which situation he continued until the
failure otlhe bank in July, 1887. During The admi-
nisraon Of Bunnel, post notes were issued by him
10 the amount OF $24l l43 and blue books and certi-
icates of depoSite TO the amount of $Il654S more,
TO which is 10 be added farther sum of S32 200 bor
rowed by the bank on pledge of its own bills, and
at an interest OF two per cent month, thus making
the transactions ofthe bank in post rotes blue books
certificates Of depose and the borrowing OF money
upon its own bills in period of about len months,
amount 10 $6l2, 29l without including the books and
certificates of deposite issued and bills loaned by
Hathorne during the last four months in which he
/ was cash er of the bank. How great portion Of
these post notes. books, certificates of depoSite and
bills were sold by the bank on its account to en-
able 1t to meet its immense Liabilities, cannot now be
ascerained, as no cash account was kept by either
Hathone or Bunnel during the last eighteen months
before the failure of the bank.
There appears TO have been another brotherin-law
of the Secretary connected with this Bank, an officer
in the Custom House, and also the President of the
Lafayette Bank whose doings connected with the
two banks are detailed in the following extract from
the report of the committees
During the summer of 1896, application had been
made to the Secretary of the Treasury The United
i States for portion OF the government depoSiteS
/ The application not Immediately acted upon by
the Secretary The Lafayette Bank had been in
corporated at the previous session OF the Legislature
and in the course of the summer had been organic
ed by the choice of its President, Directors and
Cashier, and on the 18th of July commenced IT'S
operations. At the commencement of the operations
Of the Lafayette Bank 500 300 Of its stock stood in
lhe names of Thomas RchaTdron Josiah Durham,
Ebenezer Stevens Benjamin f. HathoTne, Isa0c o.
Barnes Josiah Durham, Jr., and Thomas Ii. Dun
ham; the four first of whom were directors and
cashier Of the Franklin Bank, and of the three last
Two were the president and cashier of the Lafayette
Bank and the other minor son OF Josiah Durham,
senior Before the Lafayette Bank commenced opc-
ratons, but after the choice OF its ocers, as testlhed
BY Hahorne and admitted 10 be true by some OF the
directors of the Franklin Bank was agreed that,