The evening times., 1900-01-10
4 REPLY FROM Mr.. GAGE
Details Of Treasury Dealings Laid
Before Congress.
The Secretary Reviews the Trnnsnc-
tiOns Concerning the sale Of the
old New York Custom House and
the DePOsiting of Government
Funds in the City National Bank.

nation regarding the relations OF the
Treasury Department with the National
City Bank of New York and with the ac-
companying papers, was laid before the
House and Senate today and ordered print
ed as a document.
After some preliminary remarks in which
the resolutions authorizing the enquiry are
quoted. Mr.. Gage says:
such transactions as The Treasury De-
partment has had with The Banks specihcal-
Iy named in the resolution, OF with any
other banks not so specifically named, have
been governed by the provisions Of section
5l53 Of the Revised Statutes, which is as
, follows:
The statutes Quoted
"'An national banking associations,
| designated for that purpose by the Secre-
| tary OF the Treasury. shall be deposita-
ries Of public money. except receipts from
customs, under such regulations as may
/ be prescribed by the Secretary. and they
may also be employed as financial agents
/ of the Government. and they shall perform
| all such reasonable duties as depOsitaries
Of public moneys and financial agents OF
/ the Government. as may be required of
/ them. The Secretary Of the Treasury shall
! require the associations thus designated
/ 20 give satisfactory security. by the de-
| post OF United States bonds and other
/ wise, FOR the safekeeping and prompt pay
, ment Of the public money deposited with
! them, and for the faithful performance OF
| heir duties as financial agents Of the Gov
erDmcnt. And every association so desig-
hated as receiver or depositary Of The
Z uubli~ rlrupy shall fal-a and rar.fr-a 4f mar
/ all Of the national currency bills by what
| ever association issued. which have been
paid In 70 the Government for internal
. revenue. or for loans or stocks
] After referring 10 the final transaction
/ with the City National Bank. Mr. Gage
! takes up the old custom house sale. Ho
says The next transaction which the
! Treasury Department had with the Ma
uonal City Bank as a Government GepOsi-
| tary relates 10 the deposit with that ineti-
/ tuition Of the proceeds Of the sale Cf the
old custom house property In the city OF
| New York. This entire transaction IS
, fully described in a memorandum here
I with, prepared in the Office OF the Super
I vising Architect. Copies Of All papers and
documents relating % the S ne are also
| herewith transmitted. I adOp. as my own
| the memorandum refe red TO. because it is
I . complete and fun a. sWeT u the enUQiry
presented IN the res l,ujion.
/ Il desire % call attention 10 one feature
! Of the case which offers an opportunity
! for Observation-Disclosures. II is alleged that
[ the Secretary Of tho Treasury has violated
/ the Law by deposiuus the proceeds Of the
Z sale OF this property In a bank depos tary.
! because the act authorizing the sale de-
creed that the proceeds should Se deposited
/ Ia the United States Treasury as miscel-
laneGus receipts derived from the sale OF
/ Government property
Every United States depositary bank
| is. within the meaning Of section 5155. Re
I vised Statutes. a part Of the United States
I Treasury The moneys which may be de-
/ posted in such bank include all classes
Of receipts except customs. and when such
moneys are deposited in such q bank 20 the
| credit Of the Treasurer OF the United
I States. they are in the Treasury just as
much as IL they were physically on deposit
in the Treasury vaults IT Washington
The Comptroller Of the Treasury. whose
tecis ion is binding Upon the executive
tranch Of the Govern. ,cut holds that
money Is paid into the Treasury Of the
United States by using deposited with the
| Treasurer Of the United SJaJes here IN
/ Washington, or 10 his credit with an assist
ant treasurer or in designated depOsitaTy.
This has been the uninterrupted and uni
versal rule governing the accounting Off
GERS Of the Government for many years
Sec The letter Of Hon r. J. Tracewel.
Comptroller Of the Treasury, dated January
8, 1900 herewith.
Practice Of the Treasury.
The practice Of the Treasury Depar
ment with reference to depositiug money in
the Treasury is shown by letters addressed
to me by Mr. J. F. Meline. Assistant Treas
urer Of the United States at Washington.
ID. C.: Mr.. E. B. Daskam. who has been
connected with the department thirty-five
years, and for many years has been Chief
OF the Division of Public Moneys and Mr..
! W. +. MacLennan. who connected with
the department for thirty years, has for
twenty years Of that period been Chief Of
the Division Of Bookkeeping and Warrants
| | content myself by here quoting one-that
Of the Assistant Treasurer Of the United
States Mr.. J. F. Meline. who for thirty
four years last past has been intimately
associated with the business Of the Treas
urer's Office.
The letter of Mr. Meline follows. and
then. continuing, Mr.. Gage says;
| The proceeds of the sale of the old
custom house property IN New York city
were mone:s belonging to the United
| States, and they were deposited to the
credit Of the Treasurer OF the United
States, and were, therefore, in the
Treasury
| Court regarding the deposit Of public mon
eys and proceeds: These two cases which
have been referred to as conclusively de-
| termining the unlawfulness Of the deposit
of the proceeds of the sale Of the old
custom house property in New York in the
National City Bank, a designated deposita-
| ry. are in fact fully confirmatory Of the le-
galty OF INV action in the premises
No rent has been paid to the National
City Bank for the Governments occupancy
| Of the old custom house premises. for the
reason that such payment awaits appro-
priation by Congress.
| In a previous part of this communica-
tion / have reviewed in general the situa-
| tion leading up 10 the panic of December
| Is last. and have quoted in full the an
| nouncement which was made on the even
| ing OF that day to the effect that the Sec
| retary OF the Treasury would place in des-
ignated depositaries the incoming internal
| revenue receipts. to a total Of 1000. 900
| or $40 coo 600, should so much be applied
for. The record will show that early on
| the morning of the 18th OF December, 1899
the National City Bank had. in pursuance
of my announcement, deposited with the
| Assistant Treasurer at New York 81. GOO,
600 in United States bonds, which 1t de-
sired to pledge as security for deposits.
During the day applications of a SINH
lar kind from various parts OF the country
| we're received, and so continued until the
evening Of December % when it was found
that sixty-eight banks had applied either
for original designation or for an increase
in their former deposit allowance. The
| total sum thus applied for aggregated Sf7 -