Holmes County Republican. [volume] (Millersburg, Holmes County, Ohio) 1856-1865, 1857-08-27

We have said in former page of the re-
port, that there is no doubt that the bal
ance called for by the books of the Audit
or and Treasurer, was in the Treasury at
two different times during the past year.
We have just expressed the opinion that
the deficit has existed for long time prior
to the examination made by the Joint
Committee ard by the Auditor of State.
How, then, was the late Treasurer enabled
to produce the money or its equivalent to
these different examiners? Whence were
the funds procured TO supply the deficiency,
and conceal the defalcation? The expla-
nation is furnished by Mr.. Gibson's depo-
sitiou.
The examination BY the Joint Commit
tee and by the Auditor of State were made
early in December. Prior to this date the
Auditor had issued to the Treasurer of
State drafts on the County Treasurer, pay
able Oh til 24the of December, under the
provisions of the act of 1856, for the pur-
pose of meeting the January interest on the
foreign debt. Of course, the Treasurer
could not properly be charged with the
amount of these drafts, until they were cash
ed by the drawees. Mr.. Gibson, however,
in some instances, sent notices of the fact
that he held such drafts on the County
Treasures, who at once forwarded to him
the whole or portion of the sums drawn
for, he still holding the drafts. When the
Committe and the Auditor examined the
Treasury, the Treasurer produced the funds
which had been paid on the drafts, to make
up the deficiency, and the drafts them
selves to show that they had not been paid.
In other instances, he sent the drafts to
Banks for collection, with the request that
certificate of deposit for the amount should
be returned to him. These certificates were
also produced to the examiners, with state
ments either express or implied that the
drafts ON which they were predicted had
not been paid. In this transaction, of
course, there was nothing improper in the
conduct of the Banks or of their officers.
They have, innocently we presume, fur
nished a portion of the means by which
the deception was practiced upon by the
examiners. The profits of banking, de-
pend, in great manner, upon the time
which elapses between the issue of notes
and their presentation for paymant. So
long as they are kept in circulation, the
bank is enabled to reverse the ordinary in
cidents of Indebtedness is, she re-
ceives instead of paying interest upon her
debts. 1t is, therefore a matter of impor-
tance to every bank to put its notes into ci:-
culation at distance from home, or places
where they are likely to be retained for
business purposes, and not returned for re-
demption. To accomplish this object, and
to postpone the presentation of their paper,
the banks resort to many devices. The
Treasury of our State has been subsidiary
to this purpose. The State has been sub
sidized by capital to assist in the accumula-
ton of wealth and increase of its profits
The banks have deposited their notes with
the Treasurer of State, with the promise or
understanding from him, that they should
be paid out to the creditors of the State
residing at points remote from the location
of the bank and the funds so deposited, re-
funded after it had been paid out. The tes-
timony shows that large sums were thus
deposited, and that frequently long time
elapsed before depositors called on the
Treasurer for their money. The Treasurer
was thus furnished with the means Of de-
ceiving the most sagacious and astute ex-
aminers. He had the money always on
hand TO exhibit though not cent of il be-
lodged to the State, or was properly in its
Treasury. Indeed, the State seems to have
been in its pecuniary transactions, closely
allied with these institutions. Nearly all
the taxes were were paid into the Treasury
though the banks. Banks were the depos-
itors of the State, and the creditors of the
State were paid by checks on the banks
There is little in the correspondence of the
office for several years past to distinguish
it from that of bank, except that the wri-
ter subscribed himself Treasurer of State, -
instead of "Cashier"
For the control which the banks have
exercised over the public funds, the Treas
urers are not wholly responsible. The Leg
islature of the State has sanctioned and en-
couraged it. The act providing for the
protection of the canals and collection of
tolls, requires the collector to deposit all
money received by them in some bank de-
signated by the Treasurer of State.
The act making appropriations for the
year 1887, authorized the County Treasu-
ry, by depositing the sums due the State
in some neighboring Bank. The same
provision was incorporated into the appro-
priation bills for l841 and 1912. The
law of 1916, that fruitful source of mis-
chief in our financial administration, has
authorized the continuance of the practice
up to the present time. State Treasurers
have collected the State taxes from the
County Treasurers.
Mr.. Gibson says that he resorted to bor-
rowing, in order to meet the demands on
the Treasury and conceal the deficit. If
it is true that he received but $3O3, 900
from Mr. Breslin, the books of the office
corroborate his declaration. The balance
in the Treasury on the 18th November
last, was $35O,54s SO. If Mr.. Breslin
owed at that time, s55O.OOO, NJ NJ. Gibson G;ho
must have borrowed nearly 100000.
Notwithstanding the Act of April 9Th,
1856, forbids it, the practice of receiving
deposits and issuing certificates still con-
tinued, and furnished portion of the funds
by which the Joint Committee and the
Auditor were deceived in regard to the
condition of the Treasury. The holder of
draft on the Treasury, on presenting it
for payment, instead of the money received