The herald., 1898-04-24

The only way to have friend is to be
one"
The comparative statements of the
clearing house banks of this city, publish
ed in yesterdays issue of The Herald, at
tracted considerable attention In banking
and general business circles today and
ELECTED many favorable comments. The
ability of the banks to meet any demands
that may be made upon them is considered
fully demonstrated, while the remarkable
gains in deposits show that public conf
dence Is restored to an extent that the
most sanguine had hardly calculated.
That Southern California WILL on ac-
count chiefly of failure of grain, beet and
bean crops be a loser to the extent of
several million dollars this year is not
any longer matter of doubt. AT the
same time 1t has been pointed out that
there will be many growers on moist lands
who this year will make thousands where
they would have made hundreds. Renters
or lands have lost heavily, and will be OBJ
liged, In numerous instances, to depend
upon the forbearance of landlords, and
also to ask accommodation to enable them
to carry on their operations for another
year. The banks will have good demand
for all the money they will let go, but
there seems no reason to fear any strin-
gency in banking circles on account of the
failure of the crops named.
O O O
The security market in San Francicso
has been and still Is suffering from an
attack of nerves, and is in such condi-
ton that offerings of any considerable
size, either to buy or sell. are sufficient to
influence prices Immediately.
An impression prevails, according to the
Chronicle, that the tendency of the general
public to sell all classes of securities still
exists, and it is almost an absolute GER
tainty that more Hawaiian stock will be
dumped on the market. There are, how
ever, more purchasers than during the
first days of the week, and several of the
San Francisco banks, which are glutted
with money, and will have less use for 1t
this year in moving the grain crop than
usual, are buying bonds and stocks.
o o o
At the hearing of the case of Cashier
Steele of the Chestnut Street National of
Philadelphia last week, District Attorney
Beck brought out point as to the duties
of bank directors which Is not only inter-
sssting, but, in the opinion of the New York
E'inancier is worthy of careful study. In
part he argued as follows:
Section 521l of the revised statutes re-
Quires that reports of the condition of
bank be made to the comptroller five times
each year, the same to be verified by the
oath or affirmation of the president or
cashier, and attested by the signatures Of
at least three directors
what is the meaning of the word at
test? If it mean that the three directors
become responsible for the truth of the
reports. and thus verify the entries con-
tafned therein, as do the cashier and pres
ident, then 1t is clear that a prma facie
case has been made out against the di-
rectors who signed these reports But If
the word attest simply means that they
bear witness to or attest in the ordinary
sense to the signature of the president or
cashier. or at most to the authenticity Of
the reports, then 1t is obvious that they
cannot be committed for making false en-
tries"
"Appreciating the Importance Of the
question. | have carefully examined every
reported decision on the subject, and fur
ther requested the comptroller to advise
me as to any decision or ruling of his
office which bears upon the question. /
have failed to find any decision as to the
true meaning of the word attest with
the exception of one case In Massachu-
S setts, which decided that directors cannot
be indicted for making false entries in a
report who simply attest it, or any ruling
of the executive department of the gov
eminent. Indeed. careful examination
of all the national bank cases failed to
disclose a single case, with the exception
referred to. in which the directors, who
| 'attes:ed by their signatures to false re-
ports, were indicted for making false en-
tries, although there are many cases where
the president and cashier, who verify them
under oath, have been tried and convicted.
This fact would indicate that the general
OF the government upon this statute Is that
the directors do not verify the entries in
areport, but simply attest to the signatures
of the president or cashier. who verify it
by OATH the directors attesting to the
report as witnesses attest to the execution
of will or deed.
, meht with reference to national banks are
: very few, and seem perfectly clear. To
, falsely certify checks; to make false en-
tries in the books and reports of the asso-
Z citation; to falsely issue circulating notes;
to embezzle, abstract, or mlsappy the
funds of the bank, fairly comprise them
essence of the offense an indisputable con-
, ditions of guilt, that the accused shall
have done that which he did wilfully that
tent to injure and deffaud the bank
"Inattention to duty must not be con-
founded for the purposes of criminal
prosecution with willfu commission of
instituted against director for inatten-
'tion to duty. The prosecuting officer cam
not act without facts to justify the be-
lief that the director willfully misapplied
the funds of the bank. and with intent to
injure and defraud The supreme court
has expressly decided that maladministra-
ton, l. e., careless or negligent manage
ment, is not misapplication. The latter ex-
preston means a conscious, positive, will
full perversion of the banks funds. To
punish the director, who does not direct
congress has prescribed appropriate civil
remedies, but the official reports of cases
can be searched in vain for a single case
In which it was ever contended that di-
rectors could be indicted criminally for
neglect of duty"
In passing on the point made by the dis
trict attorney. United States Commissioner
Edmunds said that. while he was not yet
satisfied that any criminal act contem-
plated by any act of congress had been
committed by any directors OF the Chest
nut Street National, such neglect of duty
by them had been shown that line of ac-
tion civilly by the receivers "is made both
clear and easy Of performance"
Interpretations
The Shasta Water company of Fresno.
San Francisco; $25, 900: subscribed S12575,
Noes College of Osteopathy, San Fran
cisco; no capital stock.
San Francisco Indicator Advertising
company; 81 ,00O, 900; subscribed, $125
Yreka Mining and Milling company, Yre-
: ka. Siskiyou county; 100000; subscribed,
National Bank Changes
The latest bulletin of the comptroller of
the currency, dated April IS. 1898, gives the
following, among other changes:
Corporate Existence of National Banks
Extended-The Central National bank Of
washington City, District of Columbia.
until April II. 1918.
The Annville National bank, Annville.
Pa, until April II. 1918.