Mineral Point tribune. (Mineral Point, Wis.) 1869-1938, 1891-12-05

when Is necess airy preliminary 10 The
formulation and adoption Of better one.
Neither does there seem to be any clear
understanding of what is really involved
in bank examination ] have held for
some years, and still hold, that the
methods Of examination now practiced
are really useless. and that there is only
one method which is at once ractical and
efficient.
EVIDENCES OF UsELEssNEss.
I'm speaking of bank examinations
would include not only those by the regu-
larry appointed national bank examiners,
but by the examiners for the courts and
by committees of directors. ! say advised
II that they are ali failures and that they
are so necessarily. That they are useless
Philadelphia alone affords ample evidence.
The national bank examiner G d not pre-
vent the downfall OF the Keystone and
Spring Garden Banks or the serious de.
facatlon in the Manufactures National
B4uk. The court examiners did not pre-.
vent, OF discover until too late, the defal-
cations in the ProylGent Life or Union
Trust.
The directors in ali these corporations
gave no hint that there was any dIshOn-
esty, notwithstanding it was rampant, and
in the cases Of the Columbian bank and
the Bank Of America, not ign of the
internal rOttenness was found 10y the di-
rectors, or if found, was ooncea'od. only
mention cases which have become public,
but almost numberless cases could be cited
of matters seriously affecting operations
which 20 on undetscted for years, and
when found, otter by mere .C-ident, are
quietly written off
Il think need not adduce urther evil
dence in support Of the position take
that bank examiners do not examine
and will put the question IN another form
can bank examiners examiner 2 To this
] emphGtically say 10. NOg, IN order to
put the matter clearly, | win t,ke up sep
arltely the different classes Of examiners
and en2eayor to show why, in my opinion,
they cannot examine.
WHY EXAMINERS FAIL.
las to the national bank examiners,
their deficiencies can, perhaps, best be
shown by stating What ought to be the
for such a position They
should be familiar with the com nerciai
world. They should Ce possessed of wide
experience as accountants, and therefore
capable Of detecting manipulation. They
should be perfectly cOnve-Sa1t with the
general run Of the business Of each bank
examined. They should have ,ume knowl-
edge OF commercial law.
IF such be necessarily the qualifications
il will follow logically: That no mere
book keeper can satisfactorily 4 the posi-
ton; that no examiner should have more
banks TO examine than he can personally
handlo; and in my opinion no examiner
should exciusIyely examine banks.
"I- reeds very little argument to show
that Is man with p0lltiCa, influence, OF
even a good booEkeeper, wall Egs make an
efficient bank examiner
EXAMINER ASSISTANTS OF no USE.
at needs wears If practice and exper-
fence h detect fr8ud quicki7 and the ex-
perieuce must not Ouiy have oeen long but
wide Bus If for argument s8ke such a
man b. had. can lee under the present sys-
ten ey mine 10 proper manner: /
think be cannot for 5FarI. reasons. In
bans, or In fact, any busI-
ness. many points which require the
incest Judgment must come up, and if an
assistant IF little experience be employed
hs viii probably JT5l u IN, or may
even miseRa his principals therefore /
claim that an eNlul.er ould only
examine IS many rs lie g-a personally
handle,
The national bank examiner has So
many banks Is examine that he cannot do
bis wers efficiently THIS overlooking Of
the examiner ieais 70 aUot z din llty
In uruar Is e11n0miz MS Ima and get
through bis work ~ il compelled g have
pretty regular time far visiting each bank.
and wben be does make visit must finish
the examination pltbe0t interruption.
Conseau -ntly bank officials Lave a shrewd
ljga wnen TO expect the xgmlner, whIch
dishonest ones fail not & take advantage
of Bank bo1k-beepl ag@is Eeneray man
aged "a : sYstem wnleh does not readily