The morning news. [volume] (Savannah, Ga.) 1887-1900, 1891-02-01
where State Control is Needed.

Where State Control is Needed
An exposure has just been made in New
York Of the methods by which unscrupu-
lous money lenders Of that city take adj
vantage Of the necessities OF comparatively
poor people whose financial affairs are not
in a prosperous condition Acting under
corporate names, they loan money at
usnrious rates Of interest, taking as security
property worth great deal more than the
amount of money loaned upon it.
II the interest or principal is not
paid promptly the property is seized
and sold. In most cases the property is
prices for it alta forced sale. Four of these
loan companies are conducted by a man
named Silvermsn. He has quite number
Of assistants;and the names of bis companies
are high sounding ones. The Silverman
gang have .lntely come into unpleasant
notoriety. Their seizures of property have
attracted public attention, and the officers
Of the law are now in search
of them. ~ They loan money for
but they donot make loans for longer
time than four months. The security is
almost always house furniture. though it
is sometimes orders on the employers of
those to whom the money is loaned. There
is an excellent prospect that Silverman and
his gang will and it a pretty difficult mat
ter to get out of the clutches of the law
They are money sharks Of the most merci-
less kind, and there would be no sympathy
o. h.
severely.
The MORNING NEWS has several times
called attention TO the necessity for state
control Of the loan and trust companies of
this state. There is no similarity, OF course,
between the INSCRIPTIONS loan companies
like those with which Silverman is con-
nected aud the loan and trust companies of
Georgia, but there is danger that
the money intrusted to these
loan and trust companies will
not be wisely invested. There are millions
Of dollars invested in them. and the stock
holders In some Of them know little or
nothing Of the financial affairs Of them.
The state banks are under the supervision
Of the state, and there is no satisfactory
reason why these companies should not be.
Their charters come from the state, and
they are obtained without difficulty.
The projectors Of the companies, after
they have secured the Endorsement of few
respectable men. find it an easy matter to
get people to put their money into them.
The companies may be properly conducted,
but at the same time would il not be advisa-
BILE for the state 30 require them to make
statement of their financial affairs at least
twice year, fixing a heavy penalty for
false statement The shareholders in them
would then know Just what was being done
with their money, and whether or not it
was being safely invested.
Some of these companies make money In
two ways One is by getting possession of
the shares Of members who fail to pay their
regularly. There are penalties
for failures, and the penalties soon equal the
stock Of the delinquents. OF course people
in the companies, but they do not expect to
have their stock virtually conflscated. The
other way Of making money is by loaning
money at high rate Of interest.
Although 1t is pretended that all the mem
bers of such companies stand on an equal
footing In 80 far as benefits are concerned
such is not the case. The officers get good,
fat salaries and the big stockholders get the
lions share of the profits.
OF course these statements do not apply
to all loan. trust and building companies.
The majority OF such companies are hon
estly conducted, and one shareholder is not
benefited more than another, but there are
enough Of them that are started aud con-
Quoted for the benefit of few men in them
to Justify the position the MORNING NEWS
has taken with respect to such COM
paniss, viz, that they should be
supervised by the state. They are handling
the peoples money, and the legislature could
not do anything that would be more gener-
orally approved than TO throw such safe
guards around them as will prevent their
being made wildcat concerns.