Smyrna times., 1866-05-30
Bogus Banking.

For the "Smyrna Times
Bogus Banking.
In ancient times, upon dangerous coasts, sang
the syrens, Turing by their wonderful music the |
credulous mariner to destruction. The old ira
diton is of course exploded, but not the fact
which it illuStrates-that deception ever covers
itself with attractive plauSibiity. The ObServ |
ant are therefore forced to be suspicious. and
among those objects which they particularly
distrust is that generosity which SLUnS the
Hght. and rldiculOusly Processes attachment to
the interests of strangers. Most things
that ought to be done, can and should be done
openly, and especially is this true of the inau-
guraton ofall public institutions. When there
fore, mkHOWn capitalists and feed attorneys,
through SECRET agents, make SECRET arrange
ments for comforting a Bank upon a cOmmun-
ty without consulting them, the shrewd and
experienced are convinced that in the future
management of the institution there will be
more of secrecy than even in its establishment
| Now honest men are unkind enough to doubt
the expediency Of that infinitely nice system of
| banking known as wild cat. They have
seen that few unscrupulOuS managers rob,
without mercy, the widow, the orphan and the
stranger who through Ignorance have their
bourne where it is hOpelessly useless for its
notes to be returned. Being thus injurious to
others at a distance, it has come to be thought
not very respectable to allow in any town the
location of such an establishment. However,
those in the immediate vicinity are little more
safe than strangers Some of the notes will
certainly circulate within the State, and many
will be induced to entrust deposits to such un-
safe keeping Business men will be constantly
called upon to trust the doubtful corporation by
customers whose dispeasure they would incur
by refusing the checks and notes which they
present in payment of accOuntS-an annoyance
which will only be fully appreciated when We
f have lived in the vicinity of Il bogus Bank.
/ Considerations, then, both of interest and
honor, enforce the duty of preventing the es-
tabliShment Of such institutions, and that can
be done in one way Only-by securing the iItteg-
ritz Of the Stock BODE.
All subscriptions should be made by men
whose interest in the community, and estab-
liShed character, will prevent their acting as
tools for the designing in the first place. or thell
sale of stock to such persons afterwards and il
this is not to be dOne then the books should
nerer be opened We say this is the only secu
rity aganst the evil, and the fact is selfevident
when we consider that the majority of stock is
totally HnconfrOLLtbLc when once subscribed. A
Board of Directors who cannot be managed
: will be dismissed for a more compliant party.
/ The President is no more secure i'll his position
than the Board. Ife will be displaced when
ever he cannot be used His removal is, how
, ever, seldom necessary, for even the most prac
{ ticed President is so far removed las are alsC
the DirectOrs) from the minutiG of banking Op
eratiOns that he can never be certain of wha
transpres through the hands of the Cashier
! ! and Clerks; while none need be told how very
! easy thing it is to blind and caiOle an unprac
: ticcd man who is flattered by the chief Office o
: an institution in which his only interest is a few
shares of stock giUcn to him. and comfortable
salary. If either the Board or the Presiden
# be disposed to be compliant, the disreputabl
:, end is secured but if neither are, then tn
. Cashier or one of the Clerks must and will be
True he, even, may be a citizen, yet his plac
n and his salary both depend upon his masters
whose plans he must accomplish either by in
d telligent completely or by the advantage whic
). may be taken of his want of experience Will
his duties are new to him-fOr men are not sus
piciOus of treachery when they are recipient
of liberality, nor apt to be too watchtul whe
sleep is more profitable. In a neighborin
town we have seen the collapse of an lnstltu
ton born of foreign capital, when all Its Ofhcer
C President, Directors and Cashlcr-wcre cltl
Zens of the community, yet its paternity wa
is its death wound.
:. The modes in which advantage is taken Q
Bank Charters by shrewd swindlers are, hk
/ their opposite to be bounded b
any fixed rules Sometimes through the ignC
rance, carelcssness or completely of the officers
= the Banker(!) possesses himself of large quar
= titles of duly signed notes of the Bank befor
Is the Directors ever hold meeting, and of fcours
without giving an equivalent for them. Thes
IN notes, when sharp practice can no longer kee
them from the counter of the Bank, will Surel
Q, return to overthrow it. Sometimes wOrthle.
stuff (notes of men of straw, worthless stoc
n certificates, &c never intended to be paid,
n presented to and discounted by the Board th
II President or the Cashier Sometimes the Pr,
sident, Cashier or Clerk is induced to exchang
in large amounts the notes of the Bank for thos
r of some other Bdnk in which the foreign ownt
is similarly interested, and in which he ma
of have no difficulty in obtaining the Bank not,
IS. for valueess promises to pay. This last Writ
nj Gus practice is much esteemed, because ii
th good fellowship of the two machines, in circ
an lating and keeping aflOat each others note
Id puts the fatal close of the operation farther o
re- These three methods have all been practict
nd in our State, but they are only illustrations
he numerous other plans, all new until effectual
rl put into operation, which may be resorted
a There is but one safety-let no bank be esta
ng lished by foreign capital The communi
le- have nothing to hope from accommodations
le, loans from such banks. Nearly all their ava
th able funds are absorbed in the effort to preve
IRA failure before the Bankers are ready for
The object is to operate at distance, those
the vicinity of its location having but the inco
To- venience and shame of the establishment
he their share of the profits.
AN Upon all commissioners named in Ba
epo Charters rests the responsibility of protect