Middlebury register. (Middlebury, Vt.) 1886-1937, 1916-08-18

dent OF the Lamoille County Havings
Bank and Trust Company, dated Febru-
AIRY r. 1914 said
y examined the above bank Feb
ruhry 10. and find that your liability and
the liability Of Mr. Mcfarland a. tho
bank. ha6 not been decreased since my
last examination You viii remember
that IN the talk we had something ,yor q
year ago notified you that tho liability
Of tho officers NJ the bank must be m,
duced 10 the legal limit, namely ten
thousand dollars, as quickly as II could
be done, and find no progress hl L,la
made In that direction, d" In talk
Ing with MIR, Mcfarland about your
plans for Investment, he advised me
thn' you hHd decided 20 buy western
mor'Engcs' hut that they were 10 be
guaranteed by the lumber company
ANA TINT you ana Mr., Mcfarland were
20 gnhrn1tcc the lumber company,
advised MIR. Mcfarland. nnd NOW nd
wise sou that this cannot he allowed.
u IN ohlJ another method of accom-
pilshing the snmc thing aud continue
Ing The same practices which hive
objected 20 for the past four years
and which are contrary a. Inv, and
! 9hHll expect you to reduce the
liability uf yourself and sec tina, the
lahIlitic1 of tho other directors are re-
dIccl '0 tno legal Init, jus, us soon as
II Is Iossihlo 10 do go without loss TO
the h,H.
MEETING ~ NEW YORK.
AS % result Of tA;s letter Senator
Page askod me TO meet him In New York
Tor conference. replied that ] could
see no object Of a conference, tha, the
matter was perfectly stain, and no ex.
plantations were needed He Insisted up
on conference, and paid all my expenses
10 New York and return. After !ong
discussion. In which | refused 10 change
my rulings, he again gracefully yielded,
and said, You shall have no further
cause for criticism. He reduced his
LIABILITY to the bank very soon 10 the
legal limit, and the other directors also
except where they had guaranteed out
OF state loans, which | refused 10 have
released until the loans were paid, or
was satisfied they were absolutely good
October q, 1915 wrote Senator Page
as follows:
"My attention has been called TO the
statements In two recent advertise
ments OF the LnmoiIlc County Savings
Bank and Trust company, In one OF
which II is stated that the bnnk does
not look for Investments which pay
more than six per cent, and In the
other II In stated that the bank has no
assets which are not absolutely good
for the fnce value. have not attempt
tempted TO quote either OF these adver-
tisements verbatim, but In the case OF
the first one the Impression Is given
that the bank has no investments which
pay II more than six per cent, and In
the latter one the Impression IL given
thnt the banks Investments have been
no carefully made that they have de-
veloped no weaknesses. Inasmuch as
you have loans which pay you \ = and
one-half md seven per cent, the first
advertisement cannot state the sit
untion correctly. In the case Of the
other advertisement although | under
stand from you and Mr.. Mcfarland that
you have the guarantee Of Mr.. knight
and Mr.. Mcfarland on certain loans
which have developed a very substantial
weakness, and | suppose you reason that
becauce Of those guarantees the bank
WI make no loss, that you are war
ranted In making the statement in the
advertisement | think the only case
In which bank could make the state
ment properly, would be where the In
vestments had been made with such rare
Judgment and discretion that no weak
ness ever developed in any OF them, but
where. as in your case, 1t is evident that
the officers who had charge OF making
the loans in the bank, namely yourself
and Mr.. Mcfarland, as understand It,
made investments which later turned out
to be poor, even though one OF the Off
GERS Of the bank guaranteed there should
be no loss, I think the bank Is not war
ranted in conveying to the public the i'm
preston that It's officers have been so
careful and used such good judgment as
such an advertisement would Indicate.
REASONS FOR DELAY.
PLEASE consider this matter IN the
light in which | have stated IT, and 7
think you will realize that you are NOT
justified in asking the people OF the State
OF Vermont to seect your bank above
all others for the reasons indicated.
He asked for conference and assured
me that the advertising for the ban; had
been turned over to Mr. Culver. the
treasurer. and he would have nothing
further to do with e. and said he did
not realize he was doing anything i'm
proper In such Advertising
AS "A result of the conference. letters
and rullnSs Of the lark commissioner
during the nnst six years, the Lqrloille
County Savings Bank and Trust COM
panv hos atandored all the practices
which have been criticised. and the on
ly reason II took 20 long - recon- 7HHh
Il il the attitude OF Senator Page, and
his persistent Efforts to devise SCme
way In which the bnnk might purchase
out of state lonrS. ard sti'i adYC-tIse
In such n way rs to lead '''c peo~ie to
think all thc banks deposits were In
vested In Vermont o. In Vermont Sc
curi:lCS.
II have made this statement so that
the Cepc In Cur State banks may
know the attitude which the bank COM
m ssioner takes towards Illegal and IN
proper practices by the oanks oier wn!ch
no has Jurisdiction