News and citizen. [volume] (Morrisville, Vt. ;) 1881-current, 1916-08-16
"As to the first three charges
I must answer in the affirmative.

LAS to the fourth charge. I discov-
cred the illegal acts; the misleading
advertisements: the use Of banks to
evade taxation; that four Of the direc-
tors. including Senator Page. had in
CURED liabilities to the bank very
largely in excess of the legal limit,
which is $4,000, and 1 acted in each
case promptly after complete informa-
ton, and caused all such practices to
be abandoned after good deal OF
effort, and 1 will state fully and frankly
the facts with relation to all these
matters. as they have existed during
my term Of office, and as they exist at
the present time.
II found that the Lamoille County
Savings Bank and Trust company had
been investing in real estate mortgages
outside Vermont for several years. the
amount at that time being something
over one-quarter of a million of dollars
and was advertising under the slogan
"All in Vermont" 1 took up the matter
with Senator Page. the president of the
bank. and H. M. Mcfarland. the vice.
president. and advised them that the
advertisement. in my judgment. was
misleading. in that 1t caused the peo-
pie of Vermont to believe that the bank
did not invest in out of State mort
cages as many other banks were doing,
but that 1t invested all OF it's funds in
Vermont. / ascertained that two of
the directors of the bank had guaran-
teed the amount of these out of state
loans under arrangement with Sem.
ntor Page by which he paid them from
his own pocket a commission for their
guarantee, and he insisted that it was
a perfectly proper thing to do; that 1t
made the loans Vermont loans, and that
the bank had a right under those cir
cumstances to advertise that all its in
vestments were made in Vermont either
upon real estate loans or with two good
Vermont names. 1 insisted that under
the law the directors had no right to
guarantee such loans In such amounts,
and that the practice must be stopped,
both to guaranteeing the loans by
the directors. and as to the form of the
banks advertisements that the other
directors whose indebtedness was ex-
cessive must reduce 1t to the legal limit.
and was assured that should have no
cause for criticism in those matters in
the future.
MIR. sENTER's CRITICISM.
Some two years later l noticed adver-
tisements of similar character. answering
John Senters criticisms, and called the
attention of Senator Page and Mr.. Nc
Fariand to the agreemen made two years
before which 1 thought had not been hon.
estly kept l also discovered that the
bank, at the request of Senator Page,
was about to invest further in out of
State mortgages and he had asked the
treasurer to accept the Endorsement upon
such mortgages of a local corporation in
which Senator Page and other officers of
the bank were largely interested. / OBJ
Jected to this and wrote letter to Sena-
tor Page stating my objections. He call
ed for a conference upon the matter and
met him and Mr.. Mcfarland and spent
day with them going over the matter
!. fully. Senator Page insisted that their
, practices were right and ought to be al
lowed. and that the position which took
was preventing the bank from getting
additional security. took the position
that the only right and proper thing for
the bank TO do was to observe the law
which governed I'm such m alters, and That
it was bad policy in any event for the
bank to make out of State Investments
which they were not fully satisfied were
absolutely sound and safe. and that when
he induced his directors TO guarantee out
Of State loans, paving them for the guar
antee, he was offering an inducement tn
accept loans in which the bank might not
otherwise invest and that should insist