Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1920-10-18
JOKER IN Law
4 ON STATE BANK
/ Bank Examiner May Probe
Assets But Not the
: Liabilities.

Bismarck, N. D., Oct. 18.-How the !
nands or the state bank examiner are
tled. ever If he were not an appointee
ct the governor, with respect to the
Bank Of North Dakota, is shown in
a comparison of the laws governing
/ the Bank Of North Dakota and private
state. banks.
The trick by which those who
drafted the legislative bill regarding
the, bank and the "joker' inserted is
easily seen in the comparison. These
are the differences:
-. The state examiner is required,
almself or through deputies, to ex7
4 anime thoroughly into the assets and
IIANaDilities of private state banks.
IL 2. The state examiner NAV. how
.ver. investigate only the assets Of the
1 Bank OF North Dakota. He has no
authority to investigate the liabilities.
8. With respect to private state
panks the examiner is required to $50
Tar investigate the character and value
OF the assets Of each corporation as
l that the values are correctly carried.
on the books. He shall further inves-
tlgate the methods of operation. 800
s D.. With respect. to the Bank of
North Dakota he may investigate only
the assets in its possession and under
!, us control. with sufficient thorough
ness OF investigation to ascertain with
reasonable certainty whether the valu-
atoms are correctly carried on its
books"
Wy inserting the words Gin it's pos
session and under it's control" the law
is held by attorneys to give the bank
. authority to withhold many of its rec
ords from examiners.
What Law Says.
N Chapter %, section 5146 of the COM
piled laws Of 1913, says:
q "The state examiner shall, UNI
der the direction and subject to
n the orders of the state banking
board, exercise a constant super
vision. either personal or through
y. deputy. field examiners hereinafter
n provided for, over. the business
and affairs Of financial rpora
VI tons placed by this act within the
M jurisdiction of the state banking
W board and shall, personally or
\ through the deputy examiner
herein provided for, visit at least
I twice each year, all of said cor
porations, inspecting and verify.
! ing the assets n liabilities Of
each. and so far, investigate the
character and value Of the assets
! of each such corporation as to
L ascertain with reasonable GER
i tainty that the values are correctly
carried on the books. He shall
further investigate the methods of
j ONeldtlOu anu COHuuCL u Sdlu
1 corporations and their systems Of
I accounting, to ascertain whether
I such methods are in accordance
/ with the law and sound banking
i usage n principle, and report
4 the findings, conclusions n rec
concentrations upon such exanlin-
n atoms to the banking board and
a put in force and effect such orders
and directions as it may make in
1 reference thereto"
tIa Regarding the Bank of North Da-
kota. the laws of 1919, section 20, say:
IL 1.-THE state examiner shall per-
sonally or through deputy EXAM
liners visit the Bank of North Da-
kota at least twice annually and
/ shall inspect and verify the assets
in its, possession and under its
II. 4 control. with sufficient thorough
{ 's ness Of Investigation to ascertain
y with reasonable certainty whether
1 the valuations are correctly car
\ ried on it's books. Ee shall in
st vestigate it's methods of operation
and accounting. lie shall report
{ the results of. ach such eXamina-
ton to the industrial commission
1 as soon as practicable. and to the
4 Z legislative assembly at its next
III ensuing session, and as provided
in paragraph No. S Of section STAG
of the civil code, compiled laws
1918, to the state banking board"
H. o. E. Lofthus, the state examiner,
kF has made a report to the governor,
I similar to reports made by other Of
81 hcers. which are intended for the use
Ri II the legislature. The only report
3 he makes on the Bank of North Da-
sf Kota is to give the statement of F. w.
II Cathro.. Whether he plans to make
!, another report is not known.
I'll