The Washington herald., 1908-02-13

the Currency, has been moved to reply
10 published statements credited to
George NJ. Coffin, formerly a deputy
comptroller. and recently president OF the
short-lived Beaver National Bank, of
New York.
Coffin charged that sections 500 and
sos OF the Revised Statutes OF the United
States are daily violated BY every large
national bank, and made the statement
that stock gambling can be suppressed.
or at least so per cent of it obliterated,
by strict enforcement of the law. The
two sections forbid excessive loans and
Overcertifcation.
Ridgely devotes himself first 10 the al
legged eminence of his critic and gees
on TO relate that Coffin appeared as a
star witness for the defense in the trial
of John r. Walsh in connection with
the failure OF the Walsh banks in Chi
cago. and stated on oath that the prac-
tees of which Walsh had been guilty
were commonly INDUCED in by other
bankers, and that when he (Cofin) was
in the Office of the Comptroller Of the
Currency there was no special criticism
OF such methods.
Things Different Now.
Ridgely says:
Whatever may have been the facts in regard to
The enforcement Of he provisions against excessive
loans at the time when Mr.. Coffin was deputy comp
troller Of the currency and in large degree 10
sp0nSbe for its enforcement reinforcement, since
the passage Of amendment to this act on June 2,
1905, a most vigorous and determined effort has
been made BY me, as Comptroller Of the Currency,
20 enforce this section Of the bank act
, In regard 20 the violations Of section sos pro
hibisng the GENERALIZATION Of checks Mr., Coffin
statements are false based wrong information.
Several times before the receipt Of Mr. Collins let
ter. and since, ! have investigated this matter
through the national bank examiners and during
several personal visits 20 New York. find Il is not
true as Mr. Conn states that these violations exist
nearly ever day from the beginning Of bust ess
I'll us close in form readily accessible TO the bank
examiners
Mr.. Ridgely adds that as the enforce
ment of the law does not. as a matter Of
fact. stop stock gambling. Coffn's main
proposition is evidently wrong. He says
also that II the law were not now en-
forced, 10 enforce it as new proposition
would not materially affect stock gam
bling.
RidgeIy Sizes Up COhin.
Told Roosevelt How 10 Check Stock
Gambling" is the title of an article ap-
pearing in d New York newspaper which
gives copies Of certain correspondence
between the Comptroller Of the Currency
md George NJ. Coffin, formerly a Deputy
Comptroller Of the Currency, and more
recently president of the Beaver National
Bank OF New York.
In the article referred TO, Mr.. Coffin is
described as follows:
Mr. Coffin IS probably the best informed banker on
Federal banking laws in the city. He served
twelve years in the Office Of the comptroller at
Washington chief Of the division Of Issue and
chief OF the reports division which gave him super
vision o. United States bank examiners and as dep
Uty comptroller. In 1888 he became vice president Of
the Phoenix National Bank IN this city. and IN
March. 1867. president Of the Beaver National Bank
III health compelled him 20 resign that position IN
July four months later
Mr.. Ridgely comments;
The statement Of Mr. Coins services as an OIL
cial Of the Treasury Department and as a bank Off
Ger IN New York is true. AiT. Coffin has not been
connected with the comptrollers Office since have
been in that position. and ] have no personal knoWl-
edge Of his services there.
The traditions Of the offer. however do not seem
90 indicate that he was considered an efficient officer
By bis sworn testimony IN the Walsh trial at
Chicago. he admits the loosenes Of the methods EN-
ployed in the division OF which he chief
Collins History as a Banker.
While vice president of the Phoenix National
Bank, Mr.. COfin never considered an important
fsctor IN is cement. He has certainly made
no record there which entitled him to he ranked as
authority hank methods OF management
On April 6 1907 he started the Beaver National
Bank, Of which he was the first president Soon
after the organization Of the bank however It was
learned that some Of his associates were mere
gang Of promoters. some Of whom were only inter
ested in getting a promoters commission of s. Ter
share for placing the stock, and others tOok stock
and became directors for the purpose Of using their
positions 20 loan themselves money, and 10 give
themselves credit IN selling stocks throughout the
couutry.
The hrst examination Of the Beaver National Bank
after its beng chartered made in June 1907 Il
then found that this hank had made already
two very large excessive loans that the directors had
loaned themselves large part Of the assets Of the
snk that part Of the stock Of this bank was issued
as fully paid, and the balance only partly paid a
vegy irregular and uEbIsinesslike procedure which
resulted IN some people making loans partly paid
stock. thinking Il was fully paid.
Although severe letter Of criticism was written
the hank as a result Of this examination. il was
found upon the next examination, which was made
ST a shorter time than usual that the condition wss
even worse one director having placed il the hank
nearly 100000 Of paper, such as no other bank in
New York City would have accepted.
NFoHS NfSuhuGE cmenTs
The examiner reported that the bank had been
grossly mismansged from the start. aud that the
directors who had charge Of affairs had not had suf
tcieut banking experience TO conduct its manage
mebt, particularly during the crisis and the di-
rectors Of the bank were found TO he liable either
directly or indirectly, for about tvothirds Of the
loans
As a result Of this examination this Office insisted
that a bank examiner OF accountant be nit in
charge Of the hank and its books. and that us
loans be collected and the bank lquidated stating
that unless prompt action for voluntary LIQUIDATION
was taken it would be necessary for the ofHce 10
place the association in the hands Of a receiver As
result OF this the bank is now in voluntary foui-
dation Fortunately il was discovered and taken in
time 70 avoid loss Of more than part Of the cap
ital 20 that the creditors II the bank VIII doubtless
be paid in full and the shareholders save something
This IS the banking eareer Of Mr. Coffin. who as
sumes % pose authority banking questions
and crueses the conduct Of the Office Of the comp
tTuIlPr Of the currency. and accuses the leading
bankers al New York as daily committing crimes and
misdemeanors.
Reviewing Collins testimony at the
Walsh trial, and then showing the result
Of periodic examinations of New York
banks In regard TO excessive loans, Mr..
Ridgely continues:
From the above statement it VIII he seen that
violations Of section 500. in regard 20 excessive
loans. have been practically eliminated from New
York banking
On August Q there we're but three excessive loans
IN two banks, in the whole cts Of New York, out
Of the thousands Of loans made II it had not been
for the unusual conditions existing during the panic
these woald doubtless have all been eliminated BE-
fore the December call
Decentralization Rare.
In regard 10 the violation Of section sos prohibit
ing the GENERALIZATION Of checks Mr. COINS state
ments are equally false or based on wrong informa-
ton. Several times before the receipt Of Mr. COT
FMS Letters, and since, ! have investigated this
matter through the national bank examiners and
during aaEoraI r.r.oral ia. ~ W