The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-12-11


points where other general repositories were needed.
the Department has not yet been able TO complete ar
rangements with any banks which were both competent
and willing 10 be selected upon the specific provisions OF
the deposte act
In many Of these last cases therefore, the practice
has been to leave the public money with the officers
colecng IT, 10 be held in their own custody, or placed
in special deposite in banks during the short period
which might eapse before IL was wanted. and drawn
from them by drafts in favor OF the public creditors
list of the collectors and receivers from whom the
money has generally been drawn, and who had any
amounts hand subject to drafts the lst instant Is an
nexed.
The rest Of these classes OF officers who have col
lected funds beyond tho needed 10 deiray their
current expenditures, and who not conveniently
situated 10 conform TO either Of the above arrangements
have been required TO make deposles Of the same in
banks to the special cTed, Of the Treasurer.
Other funds received from the exchange Of Treasury
notes, from collections by attorneys and marshas from
patent fees and miscellaneous sources, have also, IN
most instances been placed in banks TO the credit OF the
Treasurer in special depos,e, except such amounts as
could adyantageously be put into the Mint and its
branches for the only purposes authorized in the
laws on that subject
An exhibit is presented Of the Of these special
repositories, with the sums in each The amounts re-
tanned the Mint and its branches under the provisions
OF those laws sublolned.
In the absence of suitable general repositories, some
money. due from certain State banks has been allowed
to remain IN deposite to the special credit Of the rea
snrer I'LL it wanted for public payments; they be-
ing, under all the circumstances, considered proper de-
postories for that temporary purpose, schedule OF
these banks with the remaining each subject to
draft at the last returns, is annexed
But this system OF special dcposites Of deposites
to the special credit Of the Treasurer has, from
venience, and indeed almost from necessity, gene
rally correspondent with the usual forms Of special de-
postes.
A moments reflection will show that any deposi,e
subject to be paid out by tho banks in the absence
Of tho deposition though at times convenient for officers
living banks would much Inconvenience to
those residing remote from them and that the making
OF frequent disbursements from by the latter would be
utterly impracticable. The Treasurer, in common
practice should retain his funds only in such condition
as will allow them to be paid out promptly on the hume
rous drafts which must be made in favor Of camsnts
every section Of the country For this purpose when
deposite Of them is made, il must be general, or if
special, it must be with understanding contract
not only that they TO be ready for his call at all times
and under all circumstances but that they to be paid
out on his various drafts without his actual presence
From these details it is apparent that the present sys
TEN Of keeping the public money is very complicated,
and may be deemed fortunate thar the Department
has been able during the past year, to conduct large
financial operations under without great public neon
venience. Few persons can doubt that some change
in the laws on this subject is proper. But whatever
plan Congress may adopt, too great cannot be ex-
ercsed in providing the best possible securities. All
those additional guards against defaults, which have
been urgently recommended in the last two reports on
the finances, incorporated into the bill TO es,abith
Independent Treasury, are considered important Re
cent experience IN respect to the benefits OF only ord
nary collateral security, evinces the utility Of such mea-
sures.
Thus, the losses expected to be sustained from de-
posite banks since 1884 very small in comparison
with those sustained between that period and 1917.
This considerable degree, is to be attributed TO the
additional requirements Of such security.
The improvement was voluntarily introduced by the
Department in 1883 and was afterwards sanctioned by
Congress in the depose act Of 1886.
The measure insured greater care in the management
Of the banks and increased watchfuness by the sure
tics In times of difficulty TO take efficient steps to IN
demnify the Treasury.
With view to illustrate further the effects of re-
quiring collateral security in both of banks
and collecting officers, well as to communicate in
erestng facts connection with the safety of keep
ing the public money from the foundation OF the Go
vernment, several tabular statements prepared by
the Department, are herewith presented.
First. A list of the banks still indebted to the Uni
ted States for defaults previous TO The close of 1884
none of which are believed to have given, originally,
amount due, without computing interest, equals
81 0oo676 and great part of this must be regard
ed a total loss.
Secondly. Another list of indebted banks is annex
ed, most of which gave collateral security. The
remaining dues from them 10 The Treasurer, on de-
faults accruing between 1884 and October 1887,
though al rs very large have been reduced 10 about
r. 400 600 and most, if not all of these debts, with
some others, owing to public disbursng officers, for
money on deposte, it is confidently expected, will in
the end be paid
The first nsalment due from those which have
since executed other bonds and given new security
under the act of October, 1887, has been promptly
met, and portions OF the second have already been
advanced by some Of them Suits are pending
against only two on account of their liabilities
| Thirdly The eventual losses sustained from re-
ceivers and collectors, WHILE as part of the banking
system, they were collecting the public funds, TO be
afterwards placed for safe keeping in banks, were at
the last session, estimated at sum ranging from
100000 to 81 100000 (See printed report to
House of Representatives, 2Sth February, 1888, No
1917
Collateral security had generally been taken Of
these officers; but in former times, il was not always
in so large amounts and with great care as of late
and consequently most OF the foregoing losses hap
pened many yearsago,
list of all those officers who, on the 18th Of Oc
tober, 1887 the time designated in the resolution Of
the House of Representatives stood on the books of
the Treasury as having neglected to settle their ac-
counts in season, may be seen, with the amount
charged to each, in the printed report made on the
18th of January last, document No lll) But Sc
vera Of these were not then actually indebted to the
United States, though having neglected TO adjust
their accounts at the Treasury they came within the
express words of the resolution, and consequently
were included. Some defaults have occurred or been
discovered since October, 1897; but il is appre
hended that any losses will ultimately be sustained
from them, except in the OF the former collector
OF New York. That case has been recently detect
ed and the defalcaons are supposed 10 have been
continued for many years. and to have reached a
large amount. From their character they could per-
haps have been efectually prevented only by penal
ties for false returns, system of cash duties, and
personal inspections of money and vouchers with
punishments for misuse Of the public funds, similar
TO what was urged in the report from this Depart
ment, on the finances in September, 1887. Ii is in
tended to make the particulars OF this the subject
nf n N khn for thp iIa