The Somerset herald. [volume] (Somerset, Pa.) 1870-1936, 1898-10-19


There is a labored attempt TO place
a miseonstruction upon transactions
that were Of straightforward business
character. Already the arrest of SEN
ator Quay has called forth feeling
among the friends as but few things
in his political life have done. 1t is
the general concensus OF opinion that
this unfair attempt to make political
capital out Of private business transac-
tions Will result in increasing the Re-
publican vote very generally over the
state.
AS TO THE STATE DEPOSITS.
The state treasurer prior to the ap-
prevail Of the act of 1897 had absolute
control Of the funds in the treasury.
He was required to give a bond to the
by the governor. for the safekeeping
of all funds that came into his hands
There is a common understanding in
reference TO the duties of the state
treasurer. There was no provision OF
law that required him to keep the state
moneys in any particular banking in
stitution. He could. if he so desired.
have kept all the money in his own
vaults 1t was his right to have de-
posted all OF the state funds in one
bank. or he could divide them into six
hanks. OF ne could place the funds in
a hundred or FIVE hundred banking in
stitutions. What he did with the
money. so far as its custody was con-
cerned. was absolutely and wholly at
his discretion. II was his right to place
one hundred thousand, FIVE hundred
thousand, or a million dollars in the
In this connection it should not be for
gotten that James McManes, Henry
Bumm and Clay Kemble. three Of the
directors Of the Peoples bank. were
bondsmen Of the state treasurer. They
represented an aggregate wealth Of
several million dollars. They were
known 10 be abundantly good financial
ly. The state treasurer knew. as well
as the people Of the state. that these
bOndsmen were responsible for any
amount of money intrusted to their
care. Inasmuch as they assumed the
risk Of bondsmen to the state treasurer
il was but natural that they would
expect Of the state treasurer that he
would favor them in the matter of
allowing as large a deposit as possible
with their bank. This he did, as he had
the right to do.
s.Tf ha desired ~ favor bfS frfa,d.
there being no legal objection In the
way. he had a perfect right to do so. II
may be admitted for the purpose Of ar
gument that the state treasurer favor
ed his friends IN such matters. Well,
what if he did2 Hadn't he the right to
do so, so long as the interests OF the
state were not interfered with? The
Ttate had no interest in the selection of
these banking Institutions. At that
time no interest was paid on state de-
posits. The evidence produced at the
hearing showed that State Treasurer
Haywood had a large deposit in the
Peoples bank. but there was nothing
criminal in that fact. 1t was a repu-
table institution. and had as its presi-
dent one Of the most conservative busi-
ness men Of this city. z man OF strict
integrity and high honor. who. when
his bank went into voluntary liquIda-
ton. made good all of its liabilities.
YOUNG orAYs LOAN.
The evidence showed that Richard
r. Quay, a son OF Senator Quay, had
negotiated a loan OF 100000 from the
president OF the bank He gave his
note for this loan. II was endorsed by
Senator Quay. In addition TO the re-
sponsibility Of the maker and indorser
of the note. Richard Quay had put up
collateral security to the extent OF $685.
coo. The collateral was also good. The
loan was a Straightforward business
transaction. and amply secured. He
paid interest on the note during the
time it was he d by the bank. and when
il finally matured every penny OF it was
paid 10 the receiver Of the bank. to-
gether with all Of the accrued interest
thereon. There could not have been a
more straightforward. legitimate busi-
ness transaction than that outlined by
the evidence in the case. II will be no
ticed that Senator Quay Is not con-
nected in any way with the loan TO his
son, except that he had endorsed his
paper. There is nothing IN the evidence
to show that he knew anything about J
the amount OF the deposit from the ,
state at that time
There Is another common misappre- |
hension in the minds Of some people In |
reference to the state funds. After the
state treasurer made Il deposit Of funds |
in any barking institution he had no |
further coatroi Of those funds. The |
bank then became bis debtor to the
amount of the deposit. The state treas ]
urer stood exactly in vie same relation |
10 the banking ins stisution that any |
other depositor did. The hank used |
The state funds just asi IL used the funds |
Of any private deposition. There was no |
difference in the legal standing Of the |
state as depositor and any private |
individual The stiIte treasurer re-
quired bonds from these banking .u- |
Ftitutions and relied entirely on these
securities for his protection He dill /
not claim OF exercise the right 10 say |
what should be dorss with the furds /
after they were so deposited. The banks /
made loans. took security in the reEd-
lar way. and the state treasurer was in /
no serse concerned shout the matter. I
II seems as though a. the time Richard
Quay negotiated his loan at The loeo-
pies hank the president Il that insl!-
tuition desired to have an Increase in
the state deposit This Was hut a ,sl-s-
dent business arrangement on the rsrt
Of the president OF the bank The state
treasurer was asked whether he would
Increase the deposit and answered that
he would He had perfect right 20 do
this. and il he desired in a legitimate
way TO favor a friend no one man can