New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1875-03-12
FINANCIAL INTERESTS.

THE OBSERVATION-DISCLOSURES of Inn
LAW BY COMMISSIONER DoUGLAss-possiBiiiIf
THAT THE INQUIRIES BEGUN NAY NO" bi'
sToPPED-FEEI.ING AMONG BANKING @EN.
In order TO ascertain the view taken by the
Internal Revenue Department OF the Investigation by
its officers into the Of transferring business az
banks to find whether checks not properly s'anpeu
were paid reporter OF THE TRIBUNE caied yesterday
upon Internal Revenue Supervisor haw'eV IN TINS CIV
In regard TO the construction put by oank orms upon
the law under which the investigations are carried on,
Mr. Hawley had nothing to say Lawyers amer I'D
opinops he said To him the section seemed piah anu
instiaed the Government in its action MT Hawey SAID
that the trouble began Minnesota four or i've months
sgo where II was found that the banks were paying
cheeks not stamped in accordance with the law Tue
Government saw necessity Of enforcing the payment
of the tax and began the examination OF tue oa"AS
nv means Of agents. Mr.. Smith was the only revenue
officer regularly engaged in this work In this state
although two or three others had been employed 10
for few DAYS at time. Mr.. Hale and another ohcer
few weeks ago, mad been ordered to Visit some panA
On Their way home from the West where they hao pe
on business They visited banks at BiDghamton' FL
mira. owego Ithaca, Rochester, and other places Al
zach ease where il was convenient local oincer accom-
onied the snecial agent In some places the officers
wore received with courtesy in other places they were
roundly abused. At Rochester the agent maue ms
yestigaton and to the next town at whicn nc
had been ordered TO STOP but discovered tnat nc hu
been anticipated the news of bis business having been
He found that all the internal TeYe-
nue. stamps In town had been bought
up by the banks and placed upon the checks not oe'or
legally stamped. In many cases, MT Hawiey sao'
hundreds OF found unstamped the largest
number thus found being 1900 while very few banks
were inspeced where there was some violation OF
the law The Government, Mr.. Hawley said. has re-
ceyed many offers OF settlement from banks in the west
OF from $40 TO $780, No fines have yet been imposed and
the may stop right here, the banks having
been that the Government intends to eniore the
requirements of the law.
There much talk among bank oncers ana others
interested in financial institutions yesterday concern
ing the exposure that had been made of the operations
Of internal Revenue agents One of the bank officers
who had been visited by Of these agents said that
he did not care express opinion on the matter.
The law as related TO vouchers, appeared 10 De some
what ambiguous and until the decision OF the Comms-
sIonor Of Internal Revenue was rendered would be
liable TO nisinterpretption. Whether the Government
had right to that the law was enforced by lnst
tutng an inquisitora investigation into the records OF
the banks remained be The speaker determined
before submitting take proper advice ana when the
Internal Revenue agent appeared and demanded TO see
OF the bank he refused access to them
OFFICIAL INTERPRETATION or THE LAW.
with view ha wing official decision in the mat
ter the construction OF the law, F. d. Tdppcn Presi
dent of tho Gallain National Bank OF this city, ad-
dressed i'll behaf himself ana other bankers. letter
ction OF the following questions:
l. Are notes drafts. and acceptances when made pay
able al bank subject TO stamp tax OF two cents and
ceptanees accepted prior TO Feb 8, 1875 and
which have matured and since been paid ,,o,
2. Does the apply 20 checks drawn by bank upon
itself for the purpose OF paying its own dividends, cou
pens, or interest Of other corporations -, -
cheeks drawn by State, county or city govern
ment IA bank, subject 10 this taxi
Yesterday he received the following reply:
TREASURY DEPARTMENT.
OFFICE OF INTERNAL REVENUE.
WASHINGTON. March III. 1875. }
f. D. TArPEN. esq, President GaIIatin National Bank,
sR: In Your letter of the you inquire
the PROPER Interpretation OF the word voucher" in
tiou Of Act to amend existing Customs and In
ierna Revenue laws, &c." approved ed Fe6; g. 1SaS.
bank chec draft order voucher for he payment OF
sum OF money whalsoever' drawn upon any taK
banker, or trust company shal pe supeGt 70 s1iuP
tax OF II Is understood that tuls enactment
was mado manly to meet evasions OF the saup tax on
checks by the substitution OF receipts, orders payable
one DAY date" and etc. IL imposes the tax upon
those payable at sight or demand; so also on re-
cepts AMI all other vouchers substituted ior cnteAs
SS5Silk as 'OD''D'''' "''N D'''." " ..
tax receipts in the receipt book OF savings Dank
institution for savings having no capital stock, ana
doing no other business than receiving deposits to he
loaned or invested the sole benefit of the parties
making such deposits without profit or compensation
dopoior on bis pass-Uook" This provision leaves the
all receipts tTth the above exeePuon1 given
the banks vouchers for the payment OF money on
deposit imposed ny Section Is OF the SAID act OF Feo
whether suCn receipts are loose Oh cOutdiueu u
book
Irrply TO your specific questionsi
FIRST That If there is any understanding between the
ba ana the maker OF the notes. or acceptor OF the
checks draft or payable at bank, that all such
arSd IN The account Of the makers drawer or ac
cepOr in the manner as ordinary checks would
notes and acceptances are coDsldelcd liable 10
Tie two-cent stamp vouchers" for the payment
money by the bank. This applies 10 notes, drafts
ETC., made. drawn. accepted prior to Feb 8, 1870
wlen paid oy the bank on or after that date. 49,,
Second. This tax applies TO checks drawn by DanK
upOu Of It's own dNldenus,
coupons interest OF other corporations or ior other
paimebts. .. . - Ia. .au. |
IN official capacity upon pubic DOnds deposld IN
bank are exemp' If said bonds are kept separate from
any private accounts IT not being "ltbn the Intent VI
tLe laa TO tax public treasury.
viii add with reference to some other qnetuons ire
queuty this Office that orders Tor dlVihehos
subject the tax II drawn for definite ana certain
sum, otherwise. An ordinary certnca.e OF ue-
coupons considered exempt. Bills Of e4ehsnge'
foreign well as inland, when drawn upon Danh,
tax whether pay aOe sight otherwise. Duplicates
of bills orders, etc. are liable 60 the same as orgi-
nah ReeiptS not Ie,atlng 70 T Way teespectfy o'
j. W. DOUGLASS, Commissioner.
TR0UBLEsOF NoN-ADHEsIvE STAMPS.
Some banking men declare that a large part OF the
apparent violations OF the law forbdding the payment
of uusamped checks has arisen from the want Of ad-
hes!ve power IN the stamps supplied by the Govern
meut The following sets forth this view OF the
matter
To the EditOr Of The Trt6ane.
SIR: Your article this morning noticing the oticai
radIDg OF the banks going on In the INTERIOR SCI
fles question that has been unanswered namely,
Why do the stamps issued by the treasury Depart
adhere DO those OF the Postal Every
one knows that postage stamp cannot be removed in-
tact from The envelope which II has been Attached
also check stamps adhere indferently SO that
not uncoH mon receiving checks at quarter day from
"a bank 10 mud the majority OF the stamps secured ny
pins checks. Those not SO secured may De easy
answer Is, that the Treasury Department ls man