Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1919-11-10
Tells Hatton Audience What
) Boss Thinks of Post
Dated Variety.
TELLS OF r
BANK INCIDENT
Declared That State Govern
ment Will Be Returned
to People.

MS afternoon in response to the re-
cent request made by the farmers OF
this vicinity that heGtell them some
Thing Of the recent events surround
the Observation-Disclosures bank
case. n. 3,
Some people" said the attorney
general. want to know how Secre-
the value of these post-dated checks
Some are of the opinion that they
are worth IS to IS per cent. Now, ]
Will let You. into a secret. We figured
that there was one man who knew
more about the value of those post
dated checks than any man in NORTH
Dakota and that OF course would bt
the man who tried to cash them: tina
is Townley. the man to whom
they are given, and who has contro
OF them. Therefore the testimony o
Townley as to what they arr
worth Is the best criterion.
T~ownley's Testimony
ION May 1, 1918, at Washing
ton, D. c., Townley testified un-,
der oath as to the value of post
dated checks. Senator Reed,s one
OF the committee before whom he
~ was testifying, asked him the fol-
s lowing ~Questiops:
Senator Reed-What is the total
income from all states in the way
Of membership dues?
Townley-The memberships r
somewhere around 100000 and
each member pays So.
Senator Reed-That brings it
up to approximately $1,600,0o a
year?
\ Townley-If they were all
paid. I would suggest in this
connection that the membership
pay these dues by the use of post
dated checks and sometimes they
are not always cashed, we are not
always able to cash them.
Senator Reed-Do you mea
that there is a defalcation?
!Fownley-Quite a large amountM
Senator Reed-Can you give us
an idea of what the income is?
We do not want to know how
many default, or how many bad
checks there are, but tell us what
the income is.
Townley-You want to ascer-
tain the disloyalty of the MEM
bership?
Senator Reed-Not in order to
Ascertain the disloyalty of the
membership but to ascertain how
many thousands Of dollars these
officers. who r charged with dis
loyalty have to handle.
ToNnley-Probably Is to 80
per cent is not paid.
Cash if Possible.
"Organixers have repeatedly told u!
that approximately two-fifths of tn,
paid their membership due.
in cash. Their instructions from
m to get the cash If pos.
sible. Approximately so per cent i.
paid in p~ost-dated checks, etc. L
statement under oath is tru.
that from rs to 80, per cent of thu
total memberships are not paid, ther
you have, the ratio of IS to 80 to 60
which means that approximately one
half or 50 per cent of the post-datet
checks are MOI paid, and that is exact!
~. my contention. W.
ly see that according to Townley'.
Of $1.60o,o0 of member,
ship dues per year, there would b
approximately $500 0 Of post-datet
checks, ETC., that would not be O.
much value; that at the end or three
years there would be somewhere from
million to q million and a half dol.
lars in that kind Of paper accumulat.
ed. ~ The question arises what is go.
Ing to become OF IT., Some, OF the mel
who signed this sort OF paper are
dead, some have moved. others have
refused payment Of it. The paper is IL
small amounts-all the way from si1
to eight dollars to $40 or $50. If sui
is brought bn ii, the costs would nearly
eat up whatever was realized, and ]
am here to tell you friends, that it i:
business Of mine as to what Town
ley does with, that paper as long a Il
is not used by Townley either to hurt
the credit of the state or to pile it into
operated under, the jurisdiction
Of the state banking board, or to un'
load it on the State Bank Of NORTH
Dakota; when he or anyone else at
any Of those three things. ther
It is q concern of mine!
i ,Post-dated Checks
II understand from the newspaper
that Secretary of State Hall and my
self are supposed to have said tina;
farmers p~ost-dated checks are no
good paper. The supreme court spe'
officially states that post-dated checks
are excellent security, to quote:
""There is much evidence In
the record as we'll IS in the re-