The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1912-12-11
First Testimony as to
Concentration Of
Money and Credit.
FREW ON STAND
THROUGHOUT DAY
Chairman of New York Clearing
House Put Through Grilling
Examination by Untermyer
at Investigation of So-Called
Money Trust Before
House Committee.

Washington, December 10.-The fcst
testimony as 10 concentration OF
money and credit" was heard to-day
by the House Banking and Currency
Commute in its investigation of the
so-called money trust.
W T. Frew. president Of the Corn
Exchange Bank. of New York. ana chair
man of the New York Clearing House
Committee. occupied the stand through
out the day and was put through
grilling examination by Samuel Inter
myer. counsel for the committee.
Through Mr.. Frew Mr.. Untermyer
put into the record evidence Of trust
agreements by which five men control
two OF New York's greatest financial
institutions. the Bankers Trust Com
pany and the Guaranty Trust Company.
with aggregate deposits u nearly
$500 900. 900 The Bankers Trust. MI.
Frew said. was controlled by H. p.
Dawson. George b. Case and Daniel
G.. Reid: the Guaranty Company by
II. r. Dawson. George F Baker and
William =. Porter. These ner hola
and vote all of the stock OF the COM
panies except enough to allow a board
of directors to qualify. and under the
trust agreements have absolute author
ity over the interests Of the companies.
other institutions.
How Money Is Attracted.
M. Untermyer also received from
Mr.. F-rew a description of the method
by which money was attracted 10 New
York when small country merchants
and farmers demand funds for moving
crops or the accomr, oda ton of their
business affairs. Mr.. Frew said the
ha
Stock Exchange for speculative pur-
poses; that country banks kept large
sums on deposit in New York. and
that when the home" demand for
| m ney became strong the New York
price OF money rose. and the country
banks. TO gain the big interest charges.
put their money out in call loans on
the New York Stock Exchange. All
these loans are based on Stock En-
change collateral. Mr.. Untermycr clio
tied
Mr.. Untermyer and the witness did
not get along well together and
throughout the day the col,oquy be-
tween the two, time after time. be-
evasive and insisted upon making
lengthy explanations, which led the
discussion far from the line OF ques-
tiOning Mr. Untermyer was pursuing.
When Mr. Untermye~ crdeavore1 10
attribute the enOrmOus growth of the
Bankers Trust Company to the in
fiuence OF J. +. Morgan Co. Mr..
Frew objected, and the lawyer grew
bitter. Finally he pinned tic witness
down TO the admission that the Nor
gan influence" might have aided the
company. Mr.. Untermyer connected
UP Messrs. Dawson. Case and Porter
with the Morgan company
Opportunity TO Explain.
The day ended in i discussion, i'll
which Mr. Frew. through his counsel,
Charles T.. Rushmore. demanded the
opportunity to make certain >plana-
tions as to his position in regard to
the clearing house provision. whereby
New York banks must charge a uni
form rate for the collection of out
of-town checks Mr.. UnterEsyer char
acterized this rule as 4 usurpatior 81
mower of officers of the bank and as
tending to eliminate competition. and
remarked that the clearing house
might Just as well prescribe uniform
rate of interest on deposits. as is done
under the rules of the Salt Lake City
clearing house
Mr.. Frew said this should he
stopped" but defended the out-of-
town collection rate rule
The committee ordered Mr.. Frew II
submit his request i'm writing. and he
probably will he allowed TO resume
the stand tomorrow 20 make further
statement. Benjamin Strong. presi-
sent Of the Bankers Trust Company.
also probably will be given an oppor-
tunitv to explain the workings OF the
trust agreement under which his com
pany is. operated. He demanded that
in view Of to-dsy's testimony. nc be
allowed to appear
To-morroSv the committee also vii
,akc m tie New York stock En-
,hauSe. and representatives, % that
oreanizat,on will bc asked 10 TESTIFY