Los Angeles herald., 1906-02-23
REMEDIES ARE SUGGESTED
Finds Fault With Mutual Companies
and Urges Greater Publicity
BV Assoclated Press.

and Urges Greater Publicity
BY Associated Press.
NEW YORK, Feb. 22.-The COM
mittees report contains these recon-
mendatlons.
The committee recommends that
article III of the insurance law be so
amended as to permit the formation
Hereunder of mutual corporations
without capital stock to transact the
business of life insurance and for such
other purposes as are authorized to be
connected Herewith I'm the case of
stock corporations; provided, at least
500 persons have subscribed to become
members therein in the aggregate
amount Of at least $1,OOOOOO to be inv
sured upon their lives and shall have
each paid I'm full annual premium in
cash upon the insurance subscribed for;
and provided further, that II shall
make the same deposits with the super
intendont of insurance tlat are re-
quired Of stock corporations formed for
similar purposes.
Section 200, permitting the incorpora-
tion of companies under the co-opera-
ton or assessment plan, should be
amended so as not to permit such COM
panies to be incorporated In the future
and foreign companies Of this sort not
already transacting business in this
state should not be permitted to enter
the state.
so-called Mutuals
Concerning the so-called mutual
companies the committee says
notwithstanding their theoretical
reports, the policy holders have had
little or no voice in the management.
Entrenched behind proxies easily col
lected by subservent agents and rum
Co., -=-=i
revoked, the officers of these companies
have occupied unassailable positions
and have been able to exercise despotic
powers. Ownership of the entire stock
of an unmixed corporation scarcely
could give tenure more secure.
THE most fertile source of evils IN
administration has been Irresponsible
ity of official power. However much
this may be expected in the case of
absolute stock control in that of mu-
tual company, ii proceeds from a fla
grant disregard of the law of it's being.
while it would be plainly unwise
that the management Of a life COM
pany should be rendered unstable or
that its personnel should be frequently
changed, it is of the first Importance
that officers should realize that their
direct responsibility to those whom
they represent and should rely for their
continuance in office upon proved eff
cheney and not upon a practical in
ability of the policyhoders to depose
Them
AS to stock companies the commit
tee recommends naturalization.
No More Syndicate
On the subject of investments of life
insurance companies, the committee,
after declaring against "syndicates,"
recommends various changes.
The committee adds:
1.-THE pernicious activities of corporate
agents in matters of legislation de-
mand that the present freedom of lob
bying should be restricted They have
brought suspicion upon important pro-
ceedings of the legislature and have eX-
posed it's members to consequent as
sault.
"trhe legislature owes it to itself. as
far as possible, to stop the lavish eX-
penditure of moneys ostensbly for SER
vices in connection with the support
of or opposition to bills generally be-
lieved to be used for corrupt purposes.
The legislature should free itself from
the stigma which now attaches to the
progress of measures affecting impor-
tant interests.
THE laws against bribery and cor
ruption offenses which are difficult ofl
proof are sufficiently stringent, but an
effort should be made to strike at the
root of the evil by requiring, under
proper penalties, full publicity with re-
gard to moneys expended in connection
with matters before the Legislature
Corporations should be required to
keep accounts and vouchers in which
all such payments should be fully de-
tailed and receipted for and am ade-
quate statement regarding them should
form part of such reports as may be
required"