Savannah morning news. [volume] (Savannah) 1868-1887, 1884-06-15
THE BANK oF ENGLAND.
The Great Panic of 1925 and its Effect
on the Old Lady of Threadneedle
Street-BaHk Note FOrgeries.

THE BANK OF ENGLAND.
The Great Panic of 1925 and its Eject
on the Old Lady of Threadneedle
Street-BaAk Note FOrgeries.
The excitement in financial circles in
this city recently, says the New York
Commercial Advertiser, gives increasing
interest TO the panics of the past not only
in this metropolis but in countries abroad.
There was a great panic in the Bank Of
England in December, 1926, caused by the
redemption Of interest on E215, 100000 of
stock held by the public. The Bank of
England was acting as banker for the
nation, and offered to advance money to
the holders Of stock to pay of their prin-
clpal investment. This was an era Of
speculation, and no less than f372, 600, 900,
or over 81, 500, 100000, was invested in all
kinds of = bogus" stock projects. In
some Of these schemes shares Of { 100, on
which only 70 had been paid, rose to a
premium of f40, yielding profit Of eight
times the amount Of money paid. Every
thing went merry as a marriage bell for a
time, and large sums had been withdrawn
from the Bank Of England, reducing the
gold in its vaults from IS, 900 in Oc-
tOber, 1924, to 93,624,320 in February,
1925.
The panic began on the 9Th Of December,
1926, when a London bank failed, at which
the agency of over forty country banks
was transacted, and such reaction was
the necessary result Of the previous mad
ness Of speculation. Lombard street and
the vicinity of the bank were filled with
excited men and women, some frightened
out Of their wits. others raying like
maniacs. The scenes witnessed in New
York's financial centre the past week
were Of a similar nature. The thousands
Of excited people were waiting eagerly to
withdraw their investments. Next day
I several other banks failed. The rush on
the Bank of England was terrific, but the
CLERKS kept paying away tie gUlu III bags
containing twenty-five sOvereigns each.
From 9 O'Clock a. m. until 5 p. m, each
day, twenty-five clerks were engaged
counting out gold, and as it would take
that number of clerks to count out $4,000
/ in sOyereigns, if counted by hand, plan
was adopted by which the tellers counted
/ twenty-five sovereigns into one scale and
I twenty-five into another, and if the scales
/ balanced they continued until there were
Z 200 sOyereigns in each scale. In this
I way { 600 were paid out in few min
/ utes. the weight Of LOCO soYereigns being
weigh 1 pound. In this way E31I, 900 in
/ gold was paid out in nine hours to clamor-
I Gus depOsitors.
Instead Of contracting their issues the
/ directors of the bank boldly extended
I them. In one day they discounted 4,200
/ bills. On December the discounts at the
bank amounted to 97,500, 600; on the 18th
/ they were 911,5O0,000, and on the Goth
4 9l5000,0 900. December the circulation
/ of the bank was 17,500,00 and on the
/ day before Christmas, December "a, it
I was E25, 800, 900, or the enormous sum of
/ S127 800, 900. Any kind of paper that was
/ not absolutely worthless was discounted.
! Tremendous advances on deposits Of bills
/ Of exchange were made by the bank, stock
was entered as security and eXchequer
Z bills were purchased. The gallant old in
1 stitutiOn weathered the storm, and on the
26th Of December gold began to come in
( slowly.
During the latter part of the panic week
a forgotten box of 81 notes, containing
1 &700,000. was discovered, and these were
I Immediately issued, and the directors
\ acknowledged that the forgotten box saved
l the commercial credit of the Bank of
4 England. There was only 9601 900 in
/ bullion and { 426, 900 in coin when the great
rush stopped. In February, 1897, when
the bank suspended cash payments, there
/ was /, 0S0, 10 in coin and bullion remain
ing in the vaults.
In old times a great many men were
| hanged for forging Bank of England notes.
| In one year it seems, about 1920 there
were over one hundred persons convicted
| of forgery, and nearly nine hundred were
convicted OF having forged notes in their
pockets.
There are many citizens of New York
though we'll advanced in years-who can
| remember the time, the year 1918, when
| twenty-four persons were hanged in one
year for forgeries on the bank. In the
! year 1903 there was a great forgery COM
| mitted by man named Astlett, who was
one of the chief cashiers of the bank.
The amount was so large that it fright
ened every body. Astlett did this work so
/ well, by reissuing eXchequer bills, that he
defrauded the bank out of 9320,O00 before
the forgery was detected. One can I'M
agine the general CONSERVATION. The
old governor of the bank nearly went
mad.
The biggest forgery, however, was
! Fauntleroy's, in 1916, for 100000. Faun-
tleroy was the head partner in bank in
Berners street, London, that had dealings
with the Bank of England. AS the bank
that he belonged to was in bad state,
| Fauntleroy, in order to keep up its credit,
went to work and forged powers of attOr-
ney of a lot of wealthy depositors, and
sold out their funds; yet, all the time he
was working in this way, he was paying
! dividends to the men he was robblng. But
the crash came at last, and before the
/ police broke into FauntlerOy's house they
| found a note breathing defiance against
the bank for having refused to discount
his acceptances and having thus destroyed
/ the credit of his house. FauntlerOy was
/ hanged for his crime, and an eyewitness
remarks that all London was present al
| the execution!