Los Angeles herald., 1905-11-10
SIDES
WITH TREASURER
SAYS NOT ILLEGAL TO PUT
FUNDS IN BANKS
County Officials Agitated by Dispute
Between Treasurer and
Auditor Over Disposal of
Public Moneys

Can the county funds be distributed
among the various county and city
banks at the DISCRETION of the county
treasurer is the question which is now
agitating county officials, and District
Attorney j. D. Fredericks has been ap-
pealed to for his view of the subject.
The action of County Treasurer
Mark G. Jones In placing $970,000 of the
county funds among five of the richest
national banks of the county and the
subsequent refusal of County Auditor
H. G.. Dow to swear to the report of the
treasurer because, instead of actual
funds there were only bank state
ments has raised considerable agitation
and the law on the subject will be
fully investigated.
In an interview yesterday District
Attorney Fredericks said that there is
no law prohibiting the county treasur-
er from apportioning the county funds
among whatever banks he sees fit.
Under the old law county or city
official who loaned or deposited public
funds in any of the banks would be
liable to imprisonment and disqualifi-
cation from ever holding public office in
the state.
Law Repealed
This law was done away with at the
last legislature and the county official
was given the power to deposit money
in banks. 1t did not authorize him 20
do so, but did not prohibit him from
such an act. 1t is for that reason that
the auditor still refuses to swear to
the treasurer's statement
Up to the present administration
county funds have been kept in a vault
at the Farmers and Merchants bank.
The city funds, amounting to more
than two million dollars, are piled
high in the vaults of a South Broad
way bank. Officers have been appointed
to watch the city funds but none has
been detailed TO watch over the coun-
ty money.
The county has been paying $50 a
month for the rental of a vault at the
Farmers and Merchants bank when,
according to the report of the treas
urer, only 1854 692.25 is in the vault,
while the remaining $S70,0O0 of the sur
plus Is deposited as follows: Farmers
and Merchants National, 100000; Pas
adena National, $4,000; First National
of Pasadena. $4,000; First National of
Pomona 500. 900; National of Long
Beach, $4,000.
The mere fact of the money being
deposited in the various banks Is not
troubling the taxpayers much, accord
ing to statements of county officials,
Out lHe VI peiJ IhVlt iiiciiSv
into the county treasury and then bor-
rowing that same money from coun-
ty bank at a rate of per cent interest
to the bank is where the taxpayers
register a protest.
At present the county is simply
strengthening the county banks by
placing the money with them, but an
amendment was proposed at the last
legislature which will be voted upon
this year and which, If passed, will
give the county the benefit of in
terest.
The proposed constitutional amend
ment is in part as follows: provided,
that all funds of the state, county or a
municipality within the state may he
deposited in any national banks or bank
in this state or any bank or banks or
ganized under the laws of this state,
In such a manner and under such codi-
tions as may be provided by law.
"Provided, that the bank or banks
in which such deposits shall be made
must furnish as securities United
states bonds. state, county, munich
pality or school bonds, or bonds of any
county or municipality within the state
and that these securities shall be ap-
proved by a committee appointed for
that purpose. These securities must
amount to 10 per cent in advance Of the
deposits made.
"Provided further, that such bank
or banks pay a reasonable rate of In
terest, not less than 2 per cent per an
num-"