Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1873-11-12
A MYSTERY THAT SHOULD BE EX.
PLANNED.
From the New York Tribune, Now.

From the New York Tribune, Nov. Z.
When the First National Bank of
Washington suspended it was debtor
to the Government to the amount of
S2S7.OOO. only 100000 of which was
secured The law prohibits deposits of
the public money in national banks
without the security of United States
bonds. and there has been a great deal
of curiosity to know upon what pretext
and under what circumstances the law
was violated In the case of this favored
institution. The mystery deepens when
we are semi-officially informed from
Washington, first that the SlS7 900 of
unsecured money got into the bank II
the regular course Of business, and
secondly that the Government has now
been absolutely secured against loss
without prejudice to the claims of pri-
vate creditors. Ii it is the regular
course of business IN Washington to
make unsecured deposits of public
money with national banks in contra
ventiOn of the law, the knowledge OF
that fact will be highly interesting to
the public. And if any portion Of the
securities In possession of the bank or
of Jay Cooke & Co. has been turned
over to the Government to make good
the loss, the knowledge of that fact
will be highly interesting to the private
creditors.
There are some curious circumstances
in this affair which CALI for explanation,
By the official statement of the Wash
ington banks for September, it appears
that on the 18th of that month the First
National had $4,000 Of the Govern
ment money on deposit, secured by
100000 in bonds. On the same day
Treasurer Spinner made a draft on the
bank for about $4,000, which was not
paid. A few days later he made another
draft for the same amount, and that
also was not paid. On the 18th the
bank closed its doors, and 1t was discov-
cred that, during this interval OF SIX
days, while the bank had been unable
to meet its obligations to the Govern
ment, it had secured an increase OF
$4,000 of Government. deposits with
out any augmentation of the security.
A clue to this mystery was afforded IN
our Washington correspondence the
other day. Banks outside of Washing
ton have been allowed, it seems, to OBJ
tainfractiOnal currencyOn presentation
of a certificate that an equal amount in
greenbacks had been deposited with
| them to the credit of the United States;
but this regulation did not apply to the
Washington banks, because they could
always exchange greenbacks for cur
rencY at the Treasury. Mr.. Richard
son, however, against the remon-
strances of Treasurer Spinner, violated
| the rules of the Department by issuing
to the First National Bank, a few days
before it sus pended, nearly 100000 in
fractional currency without receiving
an equivalent in greenbacks. This
probably accounts for the large balance
of unsecured deposits discovered when
the bank suspended.
But the question still remains unan-
swered, Who has since put up securities
to cover the liabilities of the Govern
ment, and of what do those securities
| consist? The receiver denies all knOwl-
| edge of the transaction, and 1t is not
| easy to understand how the assets of
the bank could be touched without his
consent. The Treasurer of the United
States knows nothing about it, and II
any securities have been turned over to
the Government they ought to be in his
possession. We submit TO Secretary
Richardson that the case requires elu-
cidation.