Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1906-09-02
LIABILITY OF DIRECTORS.

ne ldlluTe VI tue trust COupduy III
Philadelphia, carrying with 1t not only
the investment Of the stockholders, but
the savings of thousands Of others,
emphasizes anew one OF the defects,
not in the organization. but in the
operation of too many of the banks
and trust companies in which the con-
f1ding public places its cash for safe
keeping. Scarcely an institution of
the kind fails through the rascality or
poor judgment Of the active officials,
but it develops that had the directors
conscientiously attended to the duties
which the scheme of their organization
brought about the failure could not
have occurred. In the case in point
1t appears the directors had not held a
meeting for almost three years. and
when they asked the clearing house
for assistance these directors we're un-
able to give any information which
would indicate to the assembled finan-
ciers whether they would, by extend
ing aid, be tiding over an emergency
or pouring still other millions down
the sinkhole through which the de-
positors and stockholders millions
had previously disappeared.
1t is strange that men who have
earned the reputation of being careful
and shrewd business men will invest
their money in the stock of such con-
Germs and then sit idly by, permitting
the opportunity to dishonest officials
to dissipate their cash. That they
will is evidenced by practically every
failure of the kind. That they lose
their own money is of little or no mo-
ment to the public, and in the case of
institutions not public repositories
they alone suffer for their carelessness
or Indifference. In the case of banks
and similar institutions, however, such
inaction is morally IL not legally GRIM
inal. '
Almost invariably these directors
are men chosen for the very reason
that their names will be an open
sesame to public confidence, and when
they have been elected are content to
draw their dividends from profits real
ICED on the deposits of people who
have been lured by the glamor of a
long list of prominent business men
into placing their money in the COM
pany's keeping. When the crash
comes these honorable directors as a
rule escape their financial liability as
shiftily as they have previously es-
capped the duties of the Office which
they have held, but not filled.
The prison door should as certainly
close behind officials whose careless
ness permits such populations as upon
the actual thief. 1t is poor consolation
to have the man whose carelessness
has broken your bones or lascerated
your flesh present the comforting as
surance that Il didn't mean to do it. ;"
1t brings no bread to the old and in
firm who have seen their life savings
swept away by the populations of
bank president or cashier to have the
negligent director advance the assur-
ance that he didn't know they were
being robbed, or he would have pre-
vented 1t. They are chosen to know
these things and should know them,
or, rather, SO attend to their duties
that rascality on such a grand scale
would be an impossibility. The plea
they have not the time to devote to
such duties will not suffice. No man
has right to assume duties or re-
sponsibilities which he does not intend
to fulfill. If the moral sense of the
obligation will not reach such men
and prompt them to do their duty, the
law should lay upon them a burden
as will spur their activities. The dis
honest official would be none the less
prompted to misuse funds to which he
had no right, for there would be. as
now, the incentive to personal gain to
set against the chances of detection.
To the director who had no such OPP
portunity or incentive Of gain, but the
same penalties to face, 1t would be
| corrective of laziness and Indifference.