The Bridgeport times and evening farmer., 1919-01-25

provided that all securities given on a usurious consideration or upon a gaming transaction were absolutely void.
 In this country the Colonies first and the States later undertook to fix and regulate the rates of inter est and to define and prohibit usury. Massachusetts fixed the legal rate at per cent. in 1641, and reduced it to per cent. three years later. Some | of the older states, however, refused | to adopt usury laws until within re- cent years. In many of our states 1 usury statutes have been and are ! ignored, and where the transgres- | sions against the usury law have been most marked and where usury has fourished most, unmolested, we find enterprise hampered and many unhealthy conditions engendered; 1 which reminds one of a saying cred ited to Diogenes, that ''wherc neither laws have force nor water hath course, there no wise man seeks to dwell"
 To the substantial business man,
  odations from banks, there Is a kind of ghastly humor in some of the revelations resulting from an inves- tigation into the subject of usury conducted some months ago by the Comptroller's office.
 Usury Aims at American Banks.
 It was ascertained at that time that 1,247 national banks, out of a total of 1900, were openly charging rates of interest forbidden by the laws of their respective states and by the national-bank act, and that, de- spite the easy money conditions, 2,- 743 banks were charging on some of their loans interest of 10 per cent. or more per annuan.
 One bank admitted under oath that 1t was charging an average of 25 per cent. per annum on all of its | loans; another, an average of 36 per cent; and third, an average of | 40 per cent. per. annum on all | loans.
 The alarming part of all this is that wherever such a case of op- pression occurred the agitators, the | chronic trouble makers and the de-
 
 | the county made 1t the text for in | citement of rage against the capital | and the commercial methods of the l entire country.
 I will not tire you with figures, 1 but will mention just a few actual | loans made by national banks and reported under oath to the Comp trollers office which may serve as 1 illustration.
 | Here is loan of $1,00O for a month and a half at IT per cent; a loan of $2,O67 for month at 65 per cent; s553 for two months at S5 per cent; s491 for 80 days at 50 per | cent; $200 for three months at 50 | per cent.
 A visitor to my office from a cer-
 tain state not long ago, who held q
 high public office in that state, told
 me of loan of s9O made to a far
 mer to help him to raise his crops,
 the loan being for less than year.
 He said that the bank had charged
 this farmer, in addition to larger
 rate of interest, an extra sum of $50
 for the trouble of going out to look at the land and a few preliminaries
 to the loan.
 The practice of making a deduc-
 tion for expense, in addition to the
 rate of interest, seems also to have
 been an ancient one and to have | been resorted to hundreds of years
 ago. It has prevailed to an inex-
 cusable extent up to very recent date in certain of our states.
 I am sincerely gratified to be able
 to report, after all this looking at
 the dark side of the picture, that in
 the past year or so, there has been a
 vast improvement in the matter of
 interest rates throughout the coun-
 try. The evil has been greatly miti-
 gated, but it is not yet entirely eliminated. Hundreds of banks have
 made perpendicular drops from the excessive rates which they formerl!
 charged. Many that had been charg- ing on some of their loans as muct
 as 50 per cent. reduced to 12 pel cent. and in thousands of cases they have come within the legal rates o.
 their respective states.
 Now, the Banks Are Reducing Rates
 In other instances, where only l; l per cent. to Is per cent. rates hat prevailed, borrowers are now ac
 commodated at per cent. and pel cent. Some banks have adopted ; = conservative course and apparent. : have been afraid to reduce thei
 rates too suddenly, but they are nov f ing in the right direction. One banl
 testifies under oath that it has sue ceeded in reducing its maximum rat 5 from 360 per cent. to 109 per cent Another in the same state report ) that it has already brought its maxi l mum rate down from 300 to 30 pc l cent; others report that they hay = brought their average rates of 1S pc
 cent. and P per cent. down to tn l legal rate of 10 per cent.
 l I am very glad to be able to sa ) that these sensational and inexcus
 able rates are steadily disappearini
 from the sections where they hay formerly prevailed, and people 0 r every part of this country are at thi = moment securing money for all pur . poses, whether it be for commercial t business, farming, or industrial pur l poses, on more favorable terms thai S ever before In the history of ou = country.
 l Tn divers instances national bank which have been called on to reduc their rates of interest to those per . rnitted by law have not only com T piled but have advised my office tha they were conducting their bushes 3 on a plane which Is proving no = only more satisfactory to their GUS = toners. but. all things considered