The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1880-08-22
Security Of Ba nks.
QUESTIONS RAISED By THE RECENT FAILURE
IN NEWARK, ". J.

IN NEWARK, y. J.
Especial to the Baltimore Americana
WASHINGTON, August 20.-Some time ago
DEPUTY Comptroller OF the Currency John
s. Langw0rthy was authorized to examine
the condition OF the First National Bank OF
Newark, n. j., aud though ii is not exactly
known what the nature OF his report was
upon the matter, it is presumed that 1t was
favorable to the bank. This presumption
is based upOn the fact that the Comptroller
OF the Currency took no steps to secure
the stockholders from a failure, which
occurred very shortly after The eX-
animation was made. The suddenness OF
the failure excited the suspicious OF the
stockholders, and, believing that matters
were not exactly right, a meeting was held
on the 9th instant !or the purpose OF lnves-
tigating affairs. The New York Tunes OF
the next day referred TO the meeting, stating
that the stockholders, determined 10 resist
the assessment OF 100 per cent. imposed by
the Comptroller, had appointed committee
10 confer with the bank receiver. TO gain
further time TO examine the books OF the
bank. and take other necessary steps in the
interest Of the depOsitOrs, and adopted the
following:
ResoLued, That the bank-eXamirer (Mr.
JangwOIthy) who made the examination OF
the bank previous to the declaring o. the
last dividend, and rendered statement u at
the hank was in a good condition, thereby
causing great distress to those who hold
stock, shall be called upon TO explain why
such statement was made by him.
1t is stated that when Mr. Langworthy' ;
attention was called TO the above publication
be declared that he did not intend TO notice
Aofn tnn
from Mr.. Langworthy, was forwarded in 4
letter 10 the stockholders; and. quite natu-
rally. placed the matter In still more seri-
ous light, and it is said that they will now
endeayor 10 defer matters until the return
Of Mr.. Knox, who is now in Colorado. A
day or two ago the following appeared in
The editorial columns OF the New York Com
nerciql Advertiser:
"New Jersey is earning an unenyable
reputation for eglgent bank officials. 1t
seems that the stockholders in the First Ma
tional Bank, Of Newark, depended on news
paper articles for knowledge concerning the
| affairs OF their institution. The report OF
the bauk-eXaminer has been found amiSs,
and it is necessary that thorough lnVe,tl-
cation should be made rs 10 the capaDlhty
and integrity of this person. Young ana
inexperienced men are delegated by those
holding influential positions in washington
to examine the national banks, and these
examiners are frequently dlned ana "lned
| in Newark, and, in return. are expected 10
make a favorable report. Let test case be
made OF the Newark-bank difficulty"
Treasury officials do not look upon Mr..
LangwOrfhy as one OF the "young ana ln-
exDerjenced" class, and are, therefore,
generally of the opinion that test case
sbould be made, in order TO ascertain The
responsibility of examiners, and especially
| TO clear up any suspicion which may eNlst
AS far as the Controller office is concerned
| They saw il would be hardly far TO the
stockholders of the bank to bring the case
I'D now, as in the absence OF Mr.. Knox, MI
Laneworthy, the head OF the bureau, would
he called upon to pass upon his own acts
This question is OF the utmost importance
IN stockholders OF national banks generally
| as il will show to what extent bank. eXami'
ners are responsible for reporting banks In
good condition when they are not. In
number OF instances the heaviest failures
have taken place within short time after
banks have beeh reported as soma.
In this instance the case appears TO be
nerfectly clear one, as the failure occurred
yery shortly after Mr.. Langworthy's examl
nation and report. Another interesting
noint is whether 1t is customary to desig
nate deputy comptroller as an examiner
The Revised Statutes do not specify wh'
the examiners shall be, but attach the SINUS
compensation OF IS per day while employed
in such examination, and 81 for ever!
twenty-five miles he shall necessarily trave
In the performance Of bis duty and il /
mentioned as not at all unlikely that Mr.
Langworthy, desiring to visit New York
hit upon the "trip to Newark and the banl
in question as capital way for earning th