Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1896-12-24
DUTIES OF BANK DIRECTORS.

The recent bank failures out West would
doubtless have been attributed by not a
few to the election of Bryan had Bryan
been elected. but in default of that handy
excuse we are told that they are due to
the fact that their directors did not di-
rect.
This may be true, for all that we know
to the contrary. At any rate, il suggests
the inquiry if it be not possible 10 adopt
some system by which those who assume
these responsible positions may be COM
PEELED TO take greater care in the per-
Torrance OF their duties. We are told
that in other countries the penalty for
neglect Of duty in this respect is severe.
and thai, what is more TO the point, the
custom is TO enforce the laws rigidy.
Here our laws. though oftentimes sufii-
cient. are not rigidly enforced. And hence
we not only find that directors often fail
TO direct. but tnat bank examiners often
fail TO examine. The fact is that 1--WE are
all poor critters" anyway. and are 10th
10 disturb our ease by making searching
Investigations SO long as everything seems
TO be going along swimmingly..
Say what you will, it is no easy mat
ter for the average director 10 demand
proof Of every important statement that
the president OF cashier makes. 1t re-
Uuires nerve. Almost Invariably these
officers are men who have won their po-
sItions by reason of their personal popu
larity. skill, and high character. Hence
whatever they say usually carries convic-
ton with II.
Quite possibly a reform might be in
sttuted in those banks where no such
rule now prevails of having all paper Of
fered for discount passed upon two days
in the week by the board Of directors or
daily by an executive board. Often, how
ever. the officers of the bank control the
greater part of abe stock. and minority
directors do not feel called upon TO make
any very diligeat enquiries. presumng
that the owners cr the bank may be safely
trusted to manage it's affairs.
Congress now Seems disposed to make
important changes IN our banking laws.
and we hope that 1t will DO whatever
experience suggests should be done TO
Undue directors With a greater sense OF
independence and responsibility. We see
no great indication Of purpose to per-
nit the establishment Of State banks but
we believe the national banking laws will
be greatly liberslized. And while Con-
gress is legislatlag upon that subject II
might well seek to apply remedy Tor
the evil in question.
But II we examine closely we shall
doubtless find t,iat the trouble is due
more to the laxiiy Of public opinion than
TO the weakness Of the laws. We AL
want to get rich quickly. This leads us
into doubtful ventures and forces Us 10
take great risks. III we can DO so, we
borrow freely frnm the banks. or II we
are hank men, and are permitted. we lenl
ourselves money ad libitum. Our col
lateral We, OF course, believe is OF the
best, but II turns out not to be so in
times such as we have now fallen upon.
Thus good men are drawn into the
whirlpool. and finding themselves sinking.
they take desperate chances. Thus the
banks money gcts out. never 10 come
back again. and when the culpable bank
officer Is arraignsd II IS seldom that he
can be convicted, because the people do
not believe he has been guilty OF inten-
ronal wrong-dolrg. And so II goes.
But Is there no remedy for this de-
plorable state Of things? Oh. yes, we