Evening star., 1918-06-30
BY I. A. FLEMING.


of the currency promulgated ruling
that any federal depository holding
funds under court orders pending litiga
ton should pay the treasurer Of the
United States 2 per cent interest on the
money so deposited
Judge Manton, in the United States
circuit court. New York district. has
completely overruled the controller of
the currency in a decision that is far
reaching and affects every bank that
has qualified as federal depository.
Suit was started to recover interest
on $73,S15 on deposit with the Chatham
and Phoenix National Bank. the princi-
pal said to be owned by the kingdom of
Rumania. but claimed as the property
of a litigant.
The litigant having sustained his con-
tention, the money was transferred on
the order of the court back to the Guar
funds were diverted on a court order.
Having been ordered by the controller
to pay the government 2 per cent inter-
est, the Chatham and Phoenix National
Bank refused to pay interest on the de-
posit to the owner. who thereupon
brought suit.
Judge Manton said: mo rule of equity
could transfer the increment on these
funds to the United States Treasury, In
addition to the statutory fee payable to
the clerk. 1t makes little difference who
the parties to the litigation are. The
question is. the character Of the fund
and its ownership. While the Treasury
Department may make regulations un-
der which it will recognize banks as its
repositories. it is equally clear that such
regulation will not form the basis to
lawful claim to the interest Of the fund
which Is not public money. but that of
private litigants. Indeed, to rule other
the funds of his property without due
process of law. To permit the govern
ment to collect interest paid by the
bank upon this fund would be permit
ting the government to become unjustly
enriched and to deprive the owner of
this money Of his right to the interest.
Il think the regula tion OF the Treas
Try Department requiring payment Of 2
per cent interest should not be extended
to cover interest earned on funds of
private litigants. nor do think that this
court Is without authority to direct the
Treasury Department to pay back inter-
est money earned
4 Knotty Problem.
The task of keeping dollar exchange
at par point has been one of the
despite the fact that our exports are
many times greater than our imports.
Lack of unity OF action on the
part of the allies Is said to be the
main reason why dollar exchange
shows a trend below par.
of stabilizing exchange was the sug-
gestion made before the Senate COM
mittee on banking and currency
day or two ago by Leopold Frederick.
treasurer of the Chile Copper Com
pany and a director of the American
Smelling Company.
He suggested that there be formed
Immediately an interallied committee
to coordinate license bureaus in con-
troll of the import and export busi-
ness Of the United States. Great Brit
ain, France and italy and to arrange
for necessary credits In neutral coun-
tries.
To obviate the question Of neutral
ity a plan would have to Be devised
with the large banks of the four pow
ers for Immediate needs. credit OF
$500. .OOO, 900. and in this syndicate ten
countries named might participate.
The credit should be guaranteed by
all banks Jointly. Spain, now very
reluctant to yield credit, might be
placated by $4OO, 100000 in neutral
securities. Argentine. Swiss, Nor
found In allied European nations. as
basis of credit.
The Federal Reserve Board is en-
deavoring to arrange with Chile for
gold in New York.
Mr.. Frederick holds that federal
reserve foreign bank would be over
burdened with private business.
Foreign exchange business has
dwindled to about 10 per cent OF
normal.
The Utility Question.
Under this caption ]. s. Bache &
Co. OF New York have this to say:
"The plight of the utility companies
the country is reflected
in the appeal of the New YORK Kali
ways Company for increased fares
''Public utilities have been meeting
the increased burdens of the war
without proportionate increase In
their charges, and the situation OF
most of them now, at the end OF thelr
resources, is lamentable and a cry
ing national evil The appeal to com
less as was that of the railroads to
the Interstate Commerce Commission.
before the government took them over
and pitchforked the narrow policies
which had throttled them into the
dust heap.
"Such bodies of men seem to be SO
hedsed about with narrowness and
hide bound adherence to warped
views that 1t seems utterly fmpos.
sible for them to see straight and
fairly. We intimated last week that
the remedy might be by government
action, inasmutch as the disaster was
becoming widespread and would have
an obstructive effect upon war work.
'"This week the National War Labor
Board, which is endeavoring to COM
pose wage controversies between