The San Francisco call., 1898-07-22

Ing ana Loan ASSOc1atlOn, wherein He he declared that he found everything correct and satisfactory, was serving, during the entire period of his tnvest- gations, as secretary to the State Board of Building and Loan Commissioners; and while he signed his report as public accountant he came to Sacra- mento in his official capacity, and the stockholders believed when he read his report that 1t came from an official source"
 Such were the words of Corporation Counsel J. B. Devine this morning in speaking of The Calls expose of the methods employed by J. L. Fields in dealing with the sacred rights and interests of the innocent stockholders in the defunct association above men toned
 MT. Fields was given $75 for mak- ing that report, as an accountant, by the secretary of the association" con- tinued MT. Devine. When the com mittee from the stockholders made an investigation of the association's af- fairs we found that MT. Fields had come to Sacramento for the purpose of looking into the affairs of the as- sociation, as was his duty under the law. The law also requires the asso- citation to prepare a statement under the direction of some expert appointed to do that particular kind of work. We found that MT. Alsip had engaged MT. Fields to do the work of an expert, and while he was proceeding in the capac- ity of an official from the State board, he incidentally picked up S75, as his pay for work which he could easily do while he was looking through the books as secretary to the Commissioners. Now, while this may not be contrary to any statute, and may be looked upon as a matter of prOpriety on the part of the secretary, it certainly led to misunderstanding and a misapprehen- who heard MT. Fields report read as an expert, when they thought he was Speaking as an official
 Mir. Devine displayed no hesitancy in condemning such a practice, and with Major Weinstock and the balance of the shareholders acknowledges that he was entirely misled through the em- ployment CT MT. Fields in private ca paeity during the period when he was supposed to be acting as an impartial guardian of their interests under the law which defines the duties, powers and obligations of the State Commits sion.
 Section of the act of 1893 provides that the Commissioners shall visit once in every year, and as much oftener as they may deem expedient, every building and loan association in the State" It is very evident that the Commissioners intended to meet the re- quirementS of that statute by sending in their stead the secretary, who by the very nature of his employment was in a better position to make the in- quiry contemplated than the Commits sioners themselves. Consequently, when MT. Fields came to Sacramento he came under the direction of the stat ute and the shareholders had a right to presume that every communication coming from him to them was in the nature of an official notice of the con- dition of their association. The law further provides that the commission shall have access to the vaults, books, papers, and shall thoroughly examine and expert all the affairs of the asso- ciation."
 Section g. of the same act directs that if the commission find upon ex- animation that such corporation has been violating the provisions of the law governing such associations or is con- ducting business in an unsafe manner. such as to render it's further proceed ings hazardous to the public or those having funds in its custody. they shall notify the Attorney General, who shall commence proceedings" etc.
 The question arises, Did Mir Fields upon his examination find that the Union Building and Loan Association of Sacramento was violating the pro- visions of the law or was conducting its business in an unsafe manner, or such as to render it's further proceed ings hazardous to the public and those having funds in its custody? MT. Fields, as public accountant says he found the books and accounts in a satisfac- tory condition" MT. Fields, as the ex- amining officer of the State commits sion, says in his letter to Major Vein stock that he told some of the directors that the affairs of the association should be wound up at once and go into H. quidation. He did more. He gave the directors three weeks in which to fol- low out his directions or show to him that he was wrong in his estimates of value. AS matter of fact MT. Fields must have known that there was no possible escape from the inevitable fail ure of the association. Yet he did not so inform the shareholders, but kept them in the dark, and until their com mittee reported they had no intimation whatever of the awful state of affairs
 This committee in it's report says: The records show a thoroughly reck- less and unbusinesslike method of making loans." MT. Fields saw the same records, yet he reported things to be in Satisfactory condition" MT. Fields was an expert and was better qualified to judge of such matters, yet he found "correctness" and Satisfaction" on the same pages of the associations books where the committee found reckless ness and unbusinesslike methods" It seems hardly probable that the s75 given to MT. Fields for his service as a public accountant could have blinded his official eyes. and yet what he saw officially was certainly overlooked pri- vately, even though he went through the books but the one time, and after which he prepared the "accountant's' report, and yet suppressed knowledge from the shareholders which he must have gained in the same research, be- cause he admits it in his letter to Ma jor Weinstock.
 Section IS of the law of 1895 says: Every building and loan association shall make a report once a year to the commissioners, verified by oath of the president and secretary, showing ac- curately the financial condition of as- sets at the close of said term, the amount and character of all liabilities and all moneys"
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