The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1912-05-03
Money Trust Investigation to
Be Deep Probe.
Underwriting Concerns, Too,
Are Being Investigated.

4 Under their jurisdiction requesting
that the information be forwarded to
Washington. So far as is known, this
request was in every case gladly
Il granted.
4 Comptroller Murray knew that he
had no official authority by means of
which he could compel state char
| tered banks to give him information,
but he felt certain that what he
/ could not demand could, nevertheless,
i be obtained if he asked for it as a
| matter of courtesy
| For several days state chartered
| banks, as well as national banks, have
been receiving somewhat bulky docu-
ments from the so-called Pujo COM
| mittee of the house of representatives
| at Washington which has begun an
| investigation of the so-called money
trust Savings bank officials have
looked with some dismay upon
the elaborate and highly detailed
series of questions. They have also
been in some anxiety lest. relying too
strongly upon their exclusive charac-
ter as state banks, their officers be in
danger of subpoena and even of COM
initial to custody if they refuse to an
swer these questions.
Probably the greater number of
these state chartered banks of the
United States viii gladly answer the
questions put to them by the Pujo
committee. They will do this, how
ever, with a mental reservation, doubt
ing somewhat the authority even of
congress to demand of banks. charters
to which have been given by states.
that they expose all of their transac-
tions to committee of the federal
congress.
Apparently there was private dis
cussion by members of the lower
house of congress upon this very
point, and it is known that some
persuaded that the concerns of state
chartered banks were affairs over
which the national congress had no
authority. In order to surmount this |
rather troublesome obstacle congress |
has authorized this committee to OBJ
tain information within the scope of
the inquiry, and the committee is also |
horned to issue subpoenas, send for |
persons and papers, behind this power |
being the right of the committee to |
commit for contempt any recalcitrant |
witness.
A Search for Information.
1t has been assumed in Washington
that when congress authorizes an in |
VeStigation into any matter it pos
seSseS the power to compel witnesses |
to attend and to furnish the informa- |
ton sought Therefore in case any |
state chartered bank should through |
its officers refuse to answer the elab- |
crate series of questions prepared by |
the committee, or any member of 1T, |
then it is unquestionably within the |
power of the committee to issue a sub |
poena whereby the presence of Off |
GERS of the bank before the committee
will be secured. No one who is not
reckless would refuse to obey a sum-
mons of this kind.
But having brought before the COM
mittee officers of state banks who
have refused to disclose their con-
Germs to that committee, then the
chairman of the committee will put
questions verbally to these subpoenaed
witnesses. If they decline to answer
the questions then they may be adj
judged in contempt and held in Gus
tody. At that moment the right of
appeal to the courts begins, and it will
be for the courts to say whether or
not a committee of congress can be
authorized to expose the business done
by state chartered banks.
1t is the understanding in this city
that the officers of some of the state
chartered banks will be ready to test
mittee of congress to make investiga-
tion into the affairs of a state insti-
tuition.
A Great Task.
For many of the larger banks of the
United States the answering of the
questions submitted upon sheets to
them will involve a great deal of
work. A clerical force must be oc-
cupied for many days in securing from
the books the statistics which the Pujo
committee asks for.
Yet if there is to be complete and
accurate information about the man
agement or banks and the facilities
which the control of banking tnstitu-
tons offers to groups possessing large
money capital, whereby there can be
profitable underwriting of great blocks
of securities or whereby in other ways
large commissions may be made by
those who are privileged, it seems to
be essential that there be investigation
into state-chartered institutions as well
as those operating under federal
charter. In this city, and probably IN !
all the large financial centers of the
United States, the Interviewing of reso- | :
Iutions between state-chartered institu- :
tons and national banks is often very
complicated and far reaching. The :
manner in which deposits are ex- r
changed between the trust Institutions :
and the national banks is fertile field c
for investigation. The facilities which 8
are offered for what is colloquially S
,alled window dressing, through the S
close alliance between state-chartered
and national banks, are matters of c
common knowledge. Many of the direc- +
.orates of the state-chartered banks q
contain the names of men who are Z
potent in national banks. The enorn- I
ty of the deposits in the savings banks
n New York state and the utilization :
Under state law OF some part of these
deposits for the purpose of buying rail- :
way securities is q feature of modern
finance which it is essential that the q
committee of the house of representa- :
ives should understand if it's work is
20 be of any value One of the greatest | 6
If the trust institutions of this country I
S differed by men who are in very {
close affiliation with the banks and E
no small part of the great deposit line 6