The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-02-13
AMENDMENTS TO RANKING Law.
They Are Suggested by the Wrecking OF
the German Bank Of Bunalo.

ALBANY, Feb l2.-The report Of Tracy
| G. Becker Of Buffalo on an investigation
made by him as special Deputy Attorney
! General on the conditions surrounding
the failure OF the German Bank Of Buffalo
has been transmitted by AttorneyGen-
| eral Mayer to Supt. Kllburn of the State
Banking Department. Mr.. Becker recon-
mends four amendments TO the banking
law to prevent a recurrence Of the insol-
vency OF a bank under the circumstances
under which the German Bank failed and
| the Attomey-General advocates their
enactment by the Legislature.
Three Of these amendments have been
embodied in bills already introduced by
| Senator Stevens. They provide a limitation
as to the amount OF money which bank
OF trust company may loan to a person,
company or corporation; require semi
annual examination of a bank or trust
company by Its directors and detailed
report Of the same to be fled with the State
| Superintendent Of Banks, and prohibit
a director or employee Of a bank or trust
company from receiving commission or
gratuity for securing q loan from the in
stitution or permitting depositor to over
draw his account, by aking the act
uisdemeanor.
Ile lOurtn atnendrnent suggest Gu ID ludt
no bank shall be permitted TO hold az cot
| lateral or otherwise more than so per cent.
| Of the stock of any other bank and that
no bank shall loan on the stock Of another
bank TO an extent beyond the book value
| of the collateral.
Mr.. Becker reviews at length the condi-
tons which led up to the failure of the
! German Bank. In April. 1901 Arthur L.
| Appleyard of Boston. heretofore unknown
in Buffalo acquired fifty-one shares, or a
a-.t, -. k.. \ - arNifa al
BY the simple process OF acquiring
| flfty-one shares out of one hundred OF the
| capital stock OF said bank. for the purchase
price Of about 1892 500 says Mr. Becker;
aAppleyard had placed at his mercy and
under his control all of the surplus and
suspense account moneys OF said bank and
deposits to the amount Of several millions
Of dollars, except in SO far as the same
had been loaned on tho paper OF other
persons, firms and corporations, and the
latter were subject to his call al the same
matured.
THE criminal proceedings before the
Police Magistrate of Buffalo have resulted
In the issue of a warrant gainst said Apple
ward for grand larceny in the inst degree
In obtaining. on May 49, 1904. $4,000 OF the
moneys of said bank by false pretences,
as totthe value Of the securities he deposited
at the time Of obtaining said money; ana
! Of warrants. under section 6O3 OF the Penal
| Code. against Richard Emory, Eugene A.
| Georger and Robert d. Schelling for vii,
fully emitting to perform duties imposed
upon them by law as directors OF said
! bank
1T ia also claimed and there seenas 10
be evidence TO support it., that certain OF
the directors OF said bank, prior to the pur..
chase by said Appleyard Of the control OF
| its affairs on several occasions entered
into arrangements and agreements with
divers persons, firms or corporations, by
which such persons. firms and corporations,
when obtaining loans or discounts, or re-
! newals IF loans or discounts from said bank,
in addition TO paying the usual rates OF
interest to the bank thereon, paid 70 such
directors certain sums of money as COM
missions or gratuities for procuring or per-
hitting said loans, discounts or renewals