New-York tribune., 1896-12-24
THE CONTROLLERS STRANGE LETTER


Controller of the Currency Eckels. VINO mas
lust issued another report urging retirement oi
greenbacks and various other changes OF III"
TO make National banking more prohtaDie' h's
some occasion at this time to make the merits
and the beauties Of that system little clearer
than they appear in the light OF recent events
He has been suddenly obliged TO take possession
throuch n receiver of the largest National bank
except one in magnitude OF business III 'h'-
cago In long letter about TINS 1aiiure
a letter which does not seem to nave peei'
quite necessary for public interest unless 10 eN-
plain how a National bank was permitted to get
into such a cOndition-COntroller Eckels says
.Tbe failure Of the bank is due to inJudlcious'
"rcckcss and imprudent methods, followed by
"tbc officers and not checked by the directors.
"thouch their attention had been individually
"called to the same This anh other Eirse
"and doubtful loans had been called by special
"leter to the attention Of the officers ana di-
"rccors and specific Improvement PROMISED IL
"year since" This IS certainly remarkable
statement 1t will lead many to ask whether
the ample power given by law for public pro-
lection has been faithfully exerted. Is Ii the
business of Controller to wait an entire year.
after getting knowledge Of conduc, which Mr.
Eckcls row pronounccs "injudicious, reckless
and imprudert." and which many others would
pronounce criminal? How Is lie JUSTIFIED Tor
failing to ascertain whether the promise nadc
TO him had been kept and whether the BANK
had been placed in fit condition for the safety OF
the public? If the Controller does in fact con
troll. what was he doing through all tllat year
in which the promises made TO him were not at
all observed. although 1t does not appear 'ha'
for months he made any cndeavor 10 find out
whether they were or not?
II is even admitted by the Controller in effect
that there was known to he something wrong
In June last. notwithstanding the requirement.
and the promise six months before. Tor h' says:
"In June last On the surface there had been
made an improvement" This Is obviously NOT
tho language In which the Controller would have
mentioned nm apparently full performance OF
nledpes "An improvement means something
much less. But again comes the question why
the Controller. having attention called 10 the
fact that the promise of year ago had not been
fully performed in six months. did not iminedi-
ate,y make use Of the powers inirus'cd 10 him
for the public protection. For what is IN"
transaction which the Controller says, with
'OthPr large ana uOuDuu Ioin> ia" "'' '""''
"by specia letter TO the attention Of the oiic-r,
"and directors! II was Il loan to one concern
the Calumet Electric Company. OF more tihh
the entire capital and surplus OF the bank. ana
vet the National Banking act expressly provides
that The total liabilities to any banking asSOcla-
ton. 'of any person or Of any company. cor
.poration or firm for money borrowed. includ-
"lng in the liabilities OF company or iirin III"
liabilities Of the several members thereof. shall
"at no time exceed one-tcnth part Of the amount
'of the capital stock Of such ASSOCIATION actually
paid in" Still another loan was made Tor
$500 900 10 n firm In which the presidents soii-
jn-law was a partner. and third also appears
TO have been made. in amount much larger than
the law allows, to another relative
We submit that It would be well worth While
for Controller Eckcls to make 1t clear that Inc
provisions OF the National Banking law. enact
ed for the protection OF the public against dis-
honest or reckless management. are not habit
ually violated or permitted TO be violated FOR
year without inquiry. 1t would be apparently
more to the interest Of the public and more to
the interest Of the National banks themselves
II Mr. Eckels would devote less time TO the cru
SADIE against the greenbacks and somewhat more
to explanations tending to restore confidence III
the proper enforcement Of the National Banking
law by the officials appointed for that purpose.