The West Virginian. [volume] (Fairmont, W. Va.) 1914-1974, 1914-12-29

the crisis Of 1914. unlike the panlcs
Of 1898 and 1907, there was no suspen-
sion Of currency payments on the part
Of the banks of this country, either
in the large cities or In the smaller
towns. In the panics Of 1893 and
1907, in addition to clearing house
checks many artificial methods Of sup.
plying temporary currency were re-
Esorted to, while actual currency COM
handed a premium Of from 8 per cent
Ito s per cent-$1O0 in currency COST
Ing anywhere from $103 to sos or
more, in certified bank checks.
an 1914 the banks OF the country
were enabled, as a result of the in
slant and active cooperation of the
treasury department, and through the
operations Of the acts of May 80, 1908,
as amended by the Federal reserve
act, to supply actual currensy, even
during the period of greatest strtn-
tgency, to their customers and CORE
~spondcnts, both over the counter and
lin response to requests for shipments.
Whenever any Indications were seen
! Of an attempt or disposition on the
part OF any solvent bank or banks to
withhold or suspend cash payments,
the subject was taken up Immediately
by the treasury department, and pay
ments Of currency over the counter
and shipments by the banks upon de-
mand, from the centers to the nearby
and far-off districts, and vice versa,
have been maintained practically
throughout this crisis"
MIR. Williams discussed the new cur
rcncy laws and the Federal reserve
net at length to show how it is that
the government and the banks are
now in a better position to meet .
financial stringency.
Mrf. Williams asks that legislation
be put on the statute books giving the
Comptroller power to remove and dis
sipline guilty bank directors. He
says:
"The national.bank act provides that
II any loss ACQUIRES to a bank by rea-
son Of any violations of the law, the
directors may be held Individually re-
sponsIb1e If they had any part in max
ing the loans or investments upon
which the loss is sustained. AS a
PRACTICAL question, however, this re-
dress can not be ordinarily be resort
ed to-.
"Banks frequently make loans
through n~egngences or misfeasance OF
directors, which result in losses tQ the
depositors; but unless the assets Of
The bank come into the hands Of a re-
ceiver appointed by the Comptroller
end are administers under the juris-
dictlon of the Comptroller, suits
against these directors are seldom If
ever prosecuted. If a stakeholder had
knowledge Of such losses and should
undertake to recover for the benefit
CT himself and other stockholders, a
run might be preclpated on the bank
which would result in suspension of
the bank and further losses. In most
cases, however, the stockholders nave
no knowledge Of the losses thus ac-
cruing, which are frequently charged
OF to profit and loss by the action OF
the offending directors, who thus es-
cape punishment for their mismar-
agement and for the losses inflicted
upon the stockholders whose interests
they are supposed to safeguard and
protect,
IAN amendment to the law giying.to
the Comptroller Of the Currency, with
the approval OF the secretary O. the
treasury, the power to require the re-
moval OF any director or directors or
OF any officers Of a bank guilty ofsa.
violation of anySofBthe moresimportant
provisions of the national bank act,
and to direct that suit be b%roughtsin
thse;nniaIme Sof the bank against such az
rector or directors after they have
ceased Is be connscted with tie bank.
f6r tic losses sustatnad by thelF msl=
~teasanee i misteasanee In Office
would ne sanitary protective, and
beneficial