The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1841-04-16

III
isgitmate wants and dealings. The effect ofths sys-
TEN was to monopoze the active means OF the Inst-
tution, and disable il from aiding and accommodating
men engaged in business really productive and useful
to the community and as might have been anticipat
| co. large part Of the thus loaned were ut-
ma'cly lost, or the Bank compelled on disadvantage
Gus terms as TO price, to take in payment stocks back
| ators
| The loose and irregular manner in which the bust
ness OF ioaning money conducted tended greatly
10 produce this result and deserves particular notice
and explanation. From March, 1885, the period of
the passage OF the Resolution above referred to, the
CHIEF control and management of the affairs of the
institution appears to have passed from the hands of
the Directors The mode in which the Committee of
Exchange transacted their business shows that there
really existed no check whatever upon the officers,
and that the funds Of the Bank were almost entirely
at their disposition. That Committee met daily and
were attended by the Cashier, and at times by the
President They exercised the power Of making loans
ana settlements, to full great extent the
Board itself They kept no minutes Of their proceed
Ings-no book in which the loans made, and business
done were entered but their decisions and directions,
were given verbally to the officers to be by them
ried into execution The established of bust
ness seems to have becn for the First Teller TO pay
on presentation at the counter, all checks, notes,
due bills having Endorsed the order or the initials OF
ono OF the cashiers and to place these vouchers in
his drawer for much cash, where they remained,
Until just before the regular periodical counting of the
s{Hse of the Bank. These vouchers then taken
out and entered Bills Receivable" in small Me-
MOI andum Book, under the charge Of one of the
clerks. These Bills were not discounted but bore
interest yabe semi annually and secured by
pledge of stock some other kind of property It's
evidently impossible, under such circumstances, to
ascertain be assured in regard to any particular
loan settlement, that it was sanctioned by MAORI
ty of the Exchange Committee. II can be said how
ever with entire certainty that the very large bust
transacted in this does not appear upon the
face of the Discount Books, never submitted to
the examination of the members of the Board, at ITS
regular meetings. is it any where entered on the
minutes as having been reported to that body, for
their information or appreciation. As illustrative of
the Of these transactions II may be proper to
state, that the sum total of Bills Receivable"
On the 4th of March, 1886, was sc, 1921 $50 IS
On the 4th OF March, 1887, s,lS3,f45 Oh
On the 4th of March, 1888, 1929, SOB 25
On the 18th of March, 1889, /" 6,772, 1873 80
On the 9TH of March, 1910, 4,0fl, 105 "a
The amount outstanding on the books of this De-
partment, the 4th of March, lS4l had become re-
duced to the sum of I76.954 dollars, IL cents The
have been settled in various ways, trans
ered to other heads the Directors having resolved to
abolish altogether course of proceeding, so pregnant
with mischief and loss, and to prohibit entirely, all
loans except by the Board itself
There stands now upon the books OF the Suspended
Debt Department, transferred thereto from " Bills
Receivable" still unsettled 47065l dollars, n cents.
portion is on the list of Active Debt, having been
changed into Bills Discounted at deferred periods Of
maturity.
These loans were generally in large amounts. In
the List of Debts " Bills Receivable of the first
of January, 1887, twenty one individuals, firms and
companies, stand charged, each with an amount Of
one hundred thousand dollars and upwards. One
firm of this city received accommodations of this kind
between August, 1885, and November 1887, TO the
extent of 42l3S7S dollars, 80 cents, more than half
of which obtained in 1887. The officers OF the
Bank themselves received in this way loans to large
amount In March, 1886, when the Bank went into
operation under its charter, Mr.. Samuel Jaudon,
then elected its Principal Cashier, indebted to IT,
100 500 dollars. When he resigned the situation OF
Cashier, and was appointed Foreign Agent. ne was IN
debt 400 S9 dollars % cents and the first Of March
lS4l he still stood charged with Indebtedness Of
III 500 dollars. Mr.. John Andrews first Assistant
Cashier, was indebted to the Bank in March, 1886,
104 900 dollars. BY subsequent Loans and advances
made during the next three years, he received in all
the sum of 426,930 dollars, 81 cents. Mr.. Joseph
Cowpcrth,-~i.e, then second Assistant Cashier, was
in debt to the Bank in March, 1886, 10000 dollars;
when he was appointed Cashier in September, 1897,
32G 1872 dollars, 80 cents when he resigned and was
elected Director, by the Board in June, lS10 -,
$50 dollars, and he stands charged March 3 1884, on
the books with the sum of 55,0S dollars, 95 cents
II appears the books of the Bank that these three
gentlemen, were engaged in making investments on
their joint account, in the Stock and Loan of the
Camden and Woodbury. Rail Road Co, Philadelphia,
Wilmington and Baltimore Rail Road CO., Dauphin
and Lycoming Coal Lands and Grand Gulf Rail Road
and Banking Company.
The various settlements effected with the officers
and other debtors for these irregular loans must not
be suffered to pass without notice These settlements
were without the knowledge or appreciation of the
board at least so far appears from their minutes
The large loan TO firm in this city, before adverted
to- settled by the receipt in payment Of various
stocks and real estate except 224 264 dollars 80 cents
in cash. Another large amount of loans TO single
individual of l0l4977 dollars 80 cents, settled
in like manner
There was taken in settlement of debt from MessIs.
Bevan & Humphreys, (Mr Joseph Cabot, one ofthat
firm, being at the time director OF the Bank
one thousand one hundred and fifty shares of United
States Bank Stock, in 1885, viz: On the I'd of Au-
gust two hundred and fifty shares 1913 dollars, the
Bank selling the same day at 100, less brokerage
on the 22d Of August five hundred shares and on the
23d of August four hundred shares at lbs dollars the
market price on those two days being 1913 dollars, %
cents the Bank selling the day after at 1873 less bro
keiage. Settlements of similar character with
debtors for similar amounts were of frequent recur-
renee.
The first instance in which an officer paid his debt
to the Bank in other than moneys which the Commit
tee can find, in March, 1888, when Mr.. Samuel
Jaudon (thcn in London as the agent of the Bank,
Mr. Joseph Cowpeenhwaite Chen cashier AID Mr.
John Andrews Chen first assistant cashier paid
debt Of 269 500 dollars which they owed the Bank on
Joint account, in Danvie and Pottsvlc Rail Road
Company five per cent loan, 10000
Union Canal, six per cent. loan, iOOoO
Philadelphia and Reading Rail Road Com
pany stock $500 shares, 179,5OO
West Fclicana Rail Road Company stock,
100 shares, l0oOO
$3.50 500
Ofcoursc, the Committee cannot say, that the Elk
change Committee did or did not authorize
ton this settlement The paper which constitutes
the only evidence of il, and which the Committee
have exhibits no sign of such authority appro
baton, other than the initials OF Mr.. Andrews him
self.
Oftbe residue of the large debt of Mr. Andrews of
1863 04 dollars 80 ce n,s which includes his third
proportion ofthc foregoing of 800 500 dollars all
except 81 81 dollars 55 cents settled by the
transfer of Stocks and Loans.