The sun. [volume] (New York [N.Y.]) 1833-1916, 1878-02-13
blink OF NORM AMERICA LOSSES.
How they were Made aud how they Might
have been Prevented.

Messrs. A. b. Kirkland and William Lum-
mis-, experts who examined the Bank Of North
America. say. in their report to Superintendent
Lamb that IN impairment Of capital 10 tho
amount Of $3.50. 1888 exists. and that there is n
discrepancy between the reported condition Of
the institution and the Examiners estimates
Of s3jG,DOJ. The accumulated losses Of the
bans by call loans. discounts. ovcrdrafs and
shrinkage for years past We're still carried along
without recognition. and the orig inal figures
81 II counted is good. instead OF being charged
cut. or marked down To- the values oi To-day.
the losses OF the bank nave been Occasionod
by the follow NJ CAUSES.
Decentralization To- Il large extent for favored
d"uleis. VINO. IN NOM nj OF crisis or panic.
have Used this favor To save Themselves at the
eNpeusn o, the institution. In this way o.,
curr,d the Meyer loss Of s2@ 900 IN 1866. and
Of 1873
BY advancing upon unmarketable securities
not OF solid or generally known intrinsic
value.
In ls72 after the Boston fire. an overdraft Of
y 5000 was permitted. principally uLon shares
ia tie Palisades hand speculation This OVER
draft has been. by degrees, cNtluguishrd. but
not hy any h"lp from the original collateral
BY inrNi 'lent superyis on within lis own
walls. The management had become laN Had
me cushirr maintained the ordinary checks hy
one clerk up9n another. ia the book entries, and
in IN" custody o.. th" cash items. and had the
trInr- ircn accustomed 10 unexpected rNumi-
nriipns hy Nun oi th,ir ncrount- The grave lee
lll''N on i'Iull i4t nave gone W. uncut tiiS
coN"ry. increasing for morn than eight wears
The paving tcllrr made ny his cash and AL ted
M his entries day after day without super
vision. A. las "ilh'YarWrnt increased he cln-
caaed i by reporting larger amount If lrsu
tenders than 'iualiy on hnnd. amt los ulterin.
the addition Of his daily balance book. When
examinations were made 10y the directors h,
had no diill ulte in hiding Il until il reached
the sum o $4,000 IN ls1i. He then asked and
received tur anS latHuf' OF IN" second teller M
the conrealmeut. Tue latter lent h : coop RAJ
tion not only tine lrst time. but asain ana again
thereafter. while b" saw meanwhile $3j DON
more nudcd to the sum previously abstract'd.
Ga Dee, II. last. $4,000 was TAX IN. mnk Ing
then 100000. ii.ure easily carried upon the
books.
Your examiners entered the bank without
notice. and proceeding 10 the trll"rS dcsks
took u0ssrs-lon oi Their cash. The paving t'il-
er had reported tAr legal tenders on hand the
day previous aud that morn NJ. as larger than
the fact Seeing that they were To he counted
he acknowledged the delcit which amounted
To 500 600.
Tue responsibility for tho past and for the
future r-sts upon the trustees NJ well rs upon
the OH GERS j n single one OF their number
rad earnestly and lntrlligcuty done hs duty
in the rNum nations. IN the meetings ana ~
tue general supervision. the laNity OF manage
mint might have been corrected. and the i'm
proper loans, the dangerous Qualifications, Hn'
tIr unfOrunutf tellrrs endorsement ma ht al
have been checked in time.