The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1911-11-17
EXAMINERS AND OFFICERS


The New York Journal of Commerce
sees grave danger in the acceptance
OF SO many banking positions by bank
examiners. In recent editorial II
said:
Several recent incidents in the
treasury department are seriously
raising in many minds the question
what should be the proper relationship
between bank examiners and other
similar officers Of the government and
the banks to which they are accredit-
ed In an official capacity. In a number
OF Instances bank examiners have
been offered important official posi-
tons in the banks they were assigned
to, and In others they have actually
accepted the presidency OF the instttu-
tons. In at least one case = Aich has
lately come to light a bank examiner
succeeded in getting a large bonus
from tho bank whose employ he enter
ed. There can be very little doubt
that many men who are entering the
examination service are doing 80 be-
cause or the belief that they can thus
gain access to the higher range OF po-
sftions in banks which would other
wise be hopelessly CLOSED to them.
There Is good zeal Of haziness and
confusion Of mind among public men
on this question which ought to
be dispelled. Some OF them seem
TO think that the positions in
banks thus offered to members
OF the government service are
1nFN1Ny wHm -
conspicuous merit. They, there
fore. regard the appointments as
natural and proper. growing directly
out OF the experience and knowledge
acquired by the examiners. This may
be the case In some Instances, but in
the many other cases nothing Of the
kind is true. The government officer
10 chosen to an important ex-
ecutive position in a bank either be-
cause, as on some recent occasions.
the institution was in a weakened
condition and desired the prestige
supposedly to be had from placing a
government Official in charge, or else
because the examiner or other official
had acquired an intimate knowledge
OF the paper OF the community in
which the bank was situated, and
generally OF the AFFAIRS of the institu-
tons throughout the region. Either
for this prestige or this special
knowledge obtained through service
with the government, an institution
was willing to pay much higher re-
Enumeration than the appointee could
otherwise obtain. The case is thus
entirely different from that which
would exist IL the appointment came
as a recognition of professional
knowledge or ability. Appointments
on merit are frequently made where
bank examiners are chosen as clear
ing house examiners or where mem
bers OF the examining corps are APP
pointed to places In state banks and
trust companies. In such instances
the choice is evidently based upon
general desert, or at all events IL not
dictated by unsuitable considerations.
There Is absolutely no resemblance
between such appointments and those
of the kind first referred to.
Should not the treasury department
prohibit bank examiners from accept
ing offices In the banks to which they
have been accredited for a certain
number Of years after their relation
to the government Ia terminated?
This is the plan followed by various
clearing houses in their appointment
OF examiners. The examiner in such
cases signs a written agreement not
to enter the banking business In the
particular town In which he is at
work for a specified length OF time
after leaving the employ Of the clear
ing house. Precisely the same system
might be made to apply to national
bank examiners. When Comptroller
or the Currency Murray took Office
he found the service In bad condition.
Examiners were In the habit Of hold
ing stock and becoming off5cers In the
banks they examined, while they fire.
quently obtained loans at such insti-
buttons. The conptroiler put stop
to such practices and deserves very
great credit FOR 80 doing. re he would
carry his reform plan further by In
some way termnating the system
which permits the use or government
prestige TO sustain private credit or
employs government information to
extend private business. he would add
another Useful neasura to ! valuable
record.