Essex County herald. [volume] (Guildhall, Vt.) 1873-1964, 1916-08-18
CAS- to the first three charges
must answer in the affirmative.

"As 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 liabilitie6 to the bank very
largely in excess of the legal limit
which is $4,000 and l acted in each
case promptly after complete informa-
ton, and caused all such practices to
be abandoned after a good deal of
effort and / 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.
Il 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 waa advertising under the slogan
All in Vermont" l took up the matter
with Senator Page, the president of the
bank. and II. NJ. Mcfarland, the vice.
president, and advised them that the,
advertisement, in my Judgment. was
misleading, in that it caused the poo
pie Of Vermont to believe that the bank
did not invest in out of State mort
Cages as many ether banks were doing,
but that ii invested all Of it's funds in
Vermont. l aScertained that two of
the directors OF the bank had guaran--
tced the amount of these out of state
leans under an arrangement with SEN
atOr Page by which he paid them from
az P,-
guarantee, and he insisted that it was
a perfectly proper thing to do; that it
made the loans Vermont loans, and that
the bank had right under those cir
cumstarces to advertise that all its in
vestmcnts We're made in Vermont either
upon real estate loans or with two good
Vermont nnnrE. / 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 as 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 it to the legal limit,
and was assured that l should have no
cause for criticism in those matters In
the future
MIR. SGNTElRS CRITICISM.
Some TWO years later l noticed adver-
tsement3 of similar character, answering
john Seuter's criticisms, and called the
attention Of Senator Page and Mr.. Nc
Farland to the agreemen made two years
before which thought had not been hon
esly kept. I also discovered that the
bank, at the request of Senator Page.
State mortgages ana he had asked tht
treasurer to accept the Endorsement upon
such mortgages Of local corporation In
which Senator Page and other officers al
the bank We're largely interested. 7 OBJ.
je2ted to this and wrote a lette. to sena.
tor Page stating my objections He call
ed for cen orenee upon tho matter and
l met him and Mr.. Mcfarland and snent
day with them going over the matte,
fully. Senator Page Insisted that theft
practices we're right and ought to he al,
lowed md that the position which toni
was preventing the bank from ,ottir1
additional security. Z took the nosI,,o,
thnt the only right and proper tbtpr 70,
the bank TO do was 20 Obserye Tho lo,,
which governed iH such ma terS,and +h.
1t was bad policy in any event for IN,
bank to make out Of state Investment
which they wero not fully satisfied wer,
absolutely souud and safe, and thar who,
he induced his directors to guarantee nm
Of state loans, paying them for the auar
antee he was Offering an indueenent :,
accept loans in which the bank might M
otherwise invest, and that / SHOULD iusls
pNH1 AIT E1Nf 7