The morning news. [volume] (Savannah, Ga.) 1887-1900, 1891-11-05


The disaster which has overtaken the
Maverick National Bank Of Boston. full
account # which has appeared in our dis
patches, emphasizes in the strongest man
ner the necessity for amending the laws
controlling both national and state banks 50
: that it will not be in the power OF the presi-
dent aud one or two directors OF any bank
to manage its affairs TO suit Themselves.
The directors Of a bank should not be
mere dummies. They ought to be thor
Oughly acquainted with its affairs and should
take an active interest in its management.
1t is the purpose Of the banking laws that
they shall give careful attention to the du-
ties they undertake to perform, but they do
not comply with the laws in this respect and
there doesn't seem to be any way to make
them do so. The laws should provide severe
a dozen or more national banks which have
| penalties for their failure to discharge
their duties. 1t would be easy to name
been wrecked within the last year or two
by bank presidents who were permitted to
! conduct the banks entrusted 70 their keep
ing without assistance from the directors.
The Second National Bank Of New York
was nearly wrecked by its president, who
was forced TO go to Canada and remain
there. The Marine Bank OF New York was
wrecked By its president, and the keystone
National Bank and the Spring Garden
National Bank OF Philadelphia were robbed
aud wrecked by some of their officials. The
list is long one. but the foregoing are sufi-
Gent to show that it is extremely dangerous
to intrust bank to one or two men,
Asa Potter was the president OF the
wrecked Maverick bank Of Boston, and ne
and one or two directors loaned the banks
money to their close friends or borrowed it
themselves- Presi lent Potter owes the
bank several hundred thousand dollars, and
two Of the directors have borrowed from
the bank more than they can pay. The
president and these directors disregarded
the national banking laws, which limit the
amount any bank shall loan ID one person.
They obtained pretty nearly all the avail
able money in tae bank, and it is asserted
that President Potter was a partner of
Broker Evans, who committed suicide few
days ago, and that be and Evans lost
vast sum Of the banks money during the
year prior to the closing of the banks
doors. II the reports are true they lost the
money in Wall street speculationS The
banks treasury was open to them and they
obtained what money they wanted without
any protest from the board of directors
Indeed. the board knew nothing of what
they we're doing. If the board had done
its duty the Maverick National Bank would
now be solvent financial institution in all
! probability.
The controller Of the currency seems to be
altogether too slow a man for the position
he occupies. Last January he was notified
that the Maverick National Bank was in
trouble, and again in September his atten-
ton was drawn to the matter. Had he
acted promptly on the first information he
received of the banks insolvent condition
the depositors would have lost nothing
probably. and enough might have been
saved to pay the shareholders something. |
The same hardness market his conduct in |
connection with the Keystone National |
Bank.
President Potter and those who assisted |
him in wrecking the bank ought to be |
shown no mercy whatever. If they are |
found to be guilty they should receive the |
severest punishment for which the law |
provides in cases like theirs They should |
be made examples Of SO that officers of |
other banks would hesitate to use other |
peoples money as If it were their own.
The deposits OF the Maverick bank
amounted to between $1,000. 600 and IS, OOO,-
900, and there would have been widespread
suffering in Boston if the associated banks
had not agreed to pay the Mavericks de-
positors 70 per cent of their claims at once.
There is altogether too much leniency |
shown bank officials who prove recreant to |
their trusts. They should be punished for |
their misdeeds to the full extent of the law,
and bank directors should be made liable to |
punishment also for neglect of duty.