The San Francisco call., 1895-10-10

pended business October 6, 1894, and noti-
fed the Bank Commissioners of the move.
The public knew of the suspension, and
when a bank is in liquidation it is evidence
that there is no business being DONE On
April 6, 1895, we made an investigation of
the bank, and the officers on their oaths
swore that the concern was insolvent:
Now, we will go further. September IL
Judge Magee and myself made another
investigation and discovered that the bank
was inSolvent. We then took action in so
far as we were able and advised the depos-
itors and the stockholders to agree to have
a change in the board of directors, and we
got everything started that way. Mr.,
Magee then went south and [ returned to
San Francisco. The stockholders and the
depositors had meeting and split up in
row, owing to their inability to get four
directors each--there being but seven di-
rectors to be elected. Each side wanted
to control the board, and chaos reigned.
I'VE then instructed the cashier to cease
business altogether, placed Mr.. Hastings
lit being agreeable to all concerned) in as
an expert to examine the books and report
| to the Commissioners, the stockholders
and the depositors on October 7.
at will be asked why we did not report
to the Attorney General September 10
when we first discovered the insolvency
but the law reads in section of the act
D.
If the Bank Commissioners on examination
of the affairs OF any corporation mentioned in
section 3 of this act shall find that any such
corporation has been guilty OF violating its
charter, the laws of this State or any OF the
provisions of this act they shall unanimously
decide that it is unsafe for any such corpora
ton to continue to transact business, and it
shall be the duty of the Commissioners imme-
diately to take such control of such corpora
ton and all the property and effects thereof.
you can see, therefore, why we did not
report to the AttorneyGeneral. There
were but two Commissioners present when
we discovered that the bank was insol-
vent, Mr.. Fuller being away. AS soon as
possible after the real condition of the
| bank was learned we all three met at Mer-
ced October T. the day set by mutual agree
ment with the stockholders, the depositors
and ourselves and took the bank in charge
after hearing the report of the expert, Mr..
Hastings. We notified the Attorney Gen
eral that the bank was insolvent, it being
the first time all the Commissioners were
present to unanimously decide, and we re-
ceived instructions from him afterward.
We took absolute possession OF the bank
and placed Mr.. Hastings in as receiver.
1.-The men who caused us to be arrested
did SO under the provisions of section 6,
which reads:
If any Bank Commissioner shall have
knowledge, of the insolvency or un-
toned in this act and shall neglect to
report the same, in writing to the Attorney
General, as required by this act, he shall on
conviction thereof be punished by inc not
exceeding $4,000 nor less than $5000 or by
imprisonment in the county jail not less than
one year nor more than two years, or by both
such fine and Imprisonment, and his Office shall
be declared vacant by the Governor and sue
cessor be appointed for the unexpired term.
"They evidently overlooked section 4,
which allows US to use our own Judgment
in the matter of making reports, stating
clearly that we are to report If We deem it
necessary.
"If the Bank of Merced had been live
bank we would have proceeded differently
in the matter, but it was a liquidating
bank and had suspended business. 1t had
simply concluded to go out of business as
a banking house, and the public is pre-
sumed to know that bank in liquidation
is not transacting a banking business.
The whole affair was simply cooked up to
oust US, as we are all Republicans and
somebody wants to replace US with DEM
ocrats.
Just at this juncture in the conversation
Mr.. Magee came in and corroborated Mr..
KUburn's s statements, and remarked that
while they ''may have looked like crimi-
nails and iailbirds, that they did not feel
like them"