The Detroit times., 1911-07-21

Americans love to get around
law, especially IL there's money to be
made by II. They like TO get around
a law reasonably" with the aid OF
supreme court. Soon We shall nave
pleas in our criminal courts ot
reasonable" larceny, murder and
rape. Why not? For example: The
courts have ruled against the acquisi-
ton by one national bank OF stock In
another national bank. Does that
stop the practice? Not at all. The
National City bank of New York city
has organized a $10,0o0,00o company
the National City company-to DO
business in bank stocks. inls com,
pany Is to be under the absolute anu
perpetual control OF three trustees,
who must be officers or directors Oh
the National City bank. Those trus-
tees, James Stillman, chairman OF the
bank: Frank A. Vanderlip, president
and Stephen S. Palmer, a director, ex-
ercise complete powers OF ownership
electing directors, receiving all divi-
dends, and paying the money over 10
the bank for distribution among STOCK
holders who have chosen 10 acquire
an interest in the security company.
At first II was the supposition Oh
Wall-st.. that this new competitor was
entering the field against the pond
houses and brokerage firms, but II is
not. II is organized primarily to hold
bank stocks, which have hitherto
been controlled by individuals con-
|nected with what are known general
ly as the City bank interests. From
the naive account of the new enter
pris4,. I'm the New York Sun, We learn
something OF interest The methods
by which banks like the National CITY
have controlled smaller national In
stitutions have never been so direct
as those used by railroad and indus
trial corporations in holding owner
ship of other companies engaged In
the same general line of business.
When a large bank wished TO ABSORB
q small one 1t arranged the purchase
and holding OF that small insutu-
tion's stock by men associated with
the expanding bank" This kind or
expansion Is against the spirit OF the
law. but not against the letter. Never
theiess, a company Is legally author
ized To carry II on. Beginning In
1898" says the Sun, "the National
City went into that sort of thing on
large scale, buying control In the
Second National, the Bank Of the Me
tropolis. the Lincoln National bank,
the Fidelity bank and the Columbia
hank before the end of 1900. In 1901
they got control OF the Nauonai
Butchers and Drovers' bank and the
National Citizens bank. The latter In
stitution shortly afterward absorbed
the Ninth Nadonal bank, control OF
which had then recently been acquir-
ed by the Hanover National bank, a
close ally of the National City bank.
In 1904 the Central National was TAX
en- over by the Citizens Central. A
glance at the directorates of any OF
the above banks shows that the Ma
tional City's influence still dominates
all of them. II has always been un-
derstood to dominate in the Farmers
Loan and Trust company, formerly
the largest trust company In the
United States, and now second In
sizc. National City bank men are
directors on the boards of the Han
over National bank, the Riggs Ma
tional Bank OF Washington, the Amer
ican Security and Trust company OF
Washington, and the Newport Trust
company Of Newport, and have influ-
ence in the affairs Of the Fidelity
Trust company of Kansas City and OF
other smaller institutions in Omaha,
Seattle, Spokane and other Western
cities. The chief Chicago connection
OF the National City Is the Continen-
tai and Commercial National bank
the second largest bank in the United
States. Outside of the United States
II il believed to control the Bank OF
Havana, Hayti's chief bank, and other
institutions In Central and South
America. Plans for the establishing
of a great South American bank by
National City interests have been
much talked about recently. Some
of the men Of the National City bank
are getting ready to retire, says TIE
Sun. Also, the Sun does not say, this