New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1911-08-04
NATIONAL BANK CONTROL
Securities Companies Ready to
Meet Government.
LITIGATION is UNLIKELY
Cabinet May Consider Case Be-
fore MacVeagh Acts on
Wickersham Report.

Washington, Aug. s.-Attorney General
Wickersham's report on his inquiry INTO
the relations Of the National City Bank. OF
New York, with tho recently organized
National City Company was transmitted
TO Secretary MacVeagh to-day. 1t propaoy
will he a day or two before Secretary Mac
Veagh reviews tho findings, and week
or more before he decides what action, IL
any. the Treasury Department shall take.
II was learned to-day that the banking
interests are prepared for an adverse de-
cision, and that complete unders,a"ue
with the government will be reached WITH
out litigation. While the bankers in or
ganizIng the company. acted with the ad-
vice OF their lawyers they are ssid u 'oc
willing to comply with any demands 'he
Treasury Department may make.
As Secretary MacVeagh's final decision
will outline the governments atutuoe 10" :
ard concentration OF control or ownership
Of national banks by the security COM
rsny method-a situation Which aheo,'
banking interests the country oVer-'here 10
every indication that the government
course will be laid out with the greatest
collaboration. and the whole question HAY
no discussed by the Cabinet pelore a"'
public announcf mont Is made
That tho security company idea mas
crovn 70 national proportions was veflheo
further to-day by inspection OK lists OF
national bank stockholders when are o'
flo with tho Controller of the Currency
Government officials admit they were uh-
aware OF the situation until the ATTORNEY
Generals investigation Of the Natonai III!
Company brought il 10 light.
The formation of the First TRUST COM
many of Chicago. said to be tho Chicaso
First National Banks security company
r,as ma nroyided by the Treasury officials,
tacitly at least. when James b. forta"
conceived the plan several years ago lh's
was admitted i'm the Treasury Department
to-day. The organization Of the First Sc
curitv Company by the First National Bank
of New York followed soon after.
Millions OF dollars in national hank
stocks are entwned In the organization OF
these three great holding corporations ana
tho three hundred or more smaller ones
which have been discovered. II Secretary
MacVcagh acts on Attorney General WICK
ershan,s findings Treasury officials VIII
share with the bankers the problem OF DIS
sociatins the security companies from the
banks without disturbing the banking pow
or or the business Of the places In which
they exist
ono pIan already suggested proposes that
the stocks Of the security companies he
available TO any purchaser At present one
must own stock in the bank which mas
formed the security company TO hold stock
in the latter concern. In many instances
the stocks OF the security companies nave
been paid for with cash dividends on bank
stock, and sale of tho bank stock has car
ried with II the transfer Of the security
company stock.
Attorney General Wickershsm js said to
have held that such restrictions connect
the security companies so closely with the
hanks as 10 bring them within trans
gression of the national hank laws. His
ruling Is said 10 follow close on the lines
Of a decision by the Supreme Court. which
Department of Justice officials say inter-
preted the national bank law 10 mean that
each national bank shall be an Integral
unit and that none o. it's capital stock
shall be held directly or indirectly ny an
other national bank or by any device de-
signed for that purpose.
II Secretary MacVeagh's decision is made
on the Attorney Generals finding read
iustment OF the holding Of stock. Of many
Of the greatest national banks Of the coJn-
try may be necessary.
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