Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1902-12-24

"A'A thS INV governing those IH=tilu-
tons. The opinion sustained the pre-
viousiy-formed Judgment of the bank
examiner, Hon. r. T.. TimberIake. who
has left no stone unmoved 10 restrain
all banking Investment companies from
seeking business in the State unless
they are clearly entitled to do so I'M
der the law. In. his forthcoming re-
port, which viii soon be issued. Mr..
'FimbeIlake gives an able and conpre-
hensive description Of the scope and
plan of these companies, which the
journal takes pleasure in presenting I'm
advance of its publication in book form.
Within the past few months a num-
Der Of companies called Home Buyers
Associations. Home Purchasing. Asso-
citations and similar names. have either
commenced to transact business in this
State or had such purpose under con-
sideratiOn. Some had established
agencies and actually commenced to
solicit business, assuming that we had
no provision Of law applicable in such
cases, while others have first applied
TO this department for information up
on that point. In every instance they
have been promptly informed that bus
mess of such a natGre comes within the
provisions of Chapter 10, Public Laws
Of 1891 This statute provides that no
person, association or corporation, shall
carry on the business of accommodating
The savings of its members. and loan
ing 60 them such accommodations in the
manner OF loan ana building aSsocia-
lions, unless Incorporated under the
laws of this Stale. without first depos-
iting with the State Treasurer the
sum of $4,000, ana thereafter a sum
equal to fifteen per cent. of the de-
posits made with such association hy
citizens of this State. This fund is to
be held in trust for The protection ana
indemnity of the residents of the State
with whom they may transact business.
The same statute provides that, when
ever the bank examiner is of the
opinion that such an association is
tranSacting business in a manner haZ-
artlous To tho public, he may suspend
or revoke it's authority to continue bus
mess i'll the State. Every effort has
been made by the department to inform
the Office and agents of these assoc
ciations Of the provision of law. and
TO prevent them from transacting bus
iness here, at least. until they have
complied with its requirements After
comforting with the manager of one
association that had established several
agencies and transacted considerable
business i'm the State, the matter was
referred to the Attorney General for his
opinion. In his opinion the ruling OF
this department was fully confirmed;
that the nature Of the business Of these
companics brought them within the
provisions OF the law cited.
The evident readiness Of orr people
IN subscribe to- these associations, and
the extent of their business through
oyt tho country. lead me to explain TO
some extent the methods under which
they opcrate. II seems proper, too, that
this department should use every effort
10 prevent Them from transacting bust
ness in the State, and give all inform
ation nosSihle relative to the subject
for the benefit Of those who have al
ready joined such associations or con-
template doing So
Their ostensibIe purpose Is COM
mend# ble one. Any plan that enables
those OF moderate means to acquire
homes uDon easy terms is worthy OF
npproyul and entitled 10 every reason
oI;le consideration. The State should
not ONLY withdraw every restriction up
on business Of this nature but should
Grant the most liberal privileges to en-
ccuraga il. Such has been the policy
Of the state during its whole existence
II has nv statute law provided savings
GpI the 1t-
runulation of the savings of our people
tbarain Under its authority and sane
tiop loan and building associations
have also been created, for the so'e
plrpose of assisting their members IN
buvins and owning their homes Ihese
latter institutions in particular nave
received every possible consideratio
at the. hands of the legislature to en-
courage them in their good work
U,yinr this policy of the state IN
mind we could not. therefore. con-
sistcntIv oppose the business of these
now associations. provided such bust
ness he conducted upon basis that
would really give our people the priVi-
| ,eres and opportunities promised by
them.
To the end that the plan under when
tbcy orerate may be fully understood.
, we viii explain in detail just how they
| arc organized and conducted. and then
st,tc our conclusions as to the results
! that may be expected il they OBTAIN u
/ roothotd in the state.
| some of these associations are legal
lv organized rs corporations, whhe
inthers are simply associations OF itai
viduals acting under trust agreements
nv which they attempt To relieve thehl-
selves of the usual responsibilities th'''
lottach to members of a o-partnership
So far as we are able to learn. none 81
Them are governed by special restflc-
lions or regulations of law such as sur
round all kinds of banks. more espec'
liauv mutual institutions like savings
iha,,-s and loan and building associa'