Atlanta semi-weekly journal. (Atlanta, Ga.) 1898-1920, 1920-02-10
BANKERS LABEL
RESERVE BOARD
AS COERCIVE

NEW ORLEANS, Feb. T.-~Repre-
sentatives of banks in eight out of
the twelve federal reserve districts,
unanimously opposed what they
claim domination by the federal re-
serve board, coerctve methods to
force non-member banks to become
members Of the system, the univer-
sal clearance of checks at par, and
started a nationwide movement to
bring about an amendment to the
federal reserve act and to limit the
powers Of the federal reserve board,
at a meeting held here late Fri
day.
Following the adoption OF tho res
olution, which is to be sent to
every bank in the United States and
to the members of congress, the body
voted to form a temporary organ1za-
ton to be known as the National
and State Banks Protective associa-
ton to fight in every section of the
country, to have certain sections Of
the federal reserve act amended by
resolution adopted at the meeting
here were AZ follows:
To most vigorously protest against
the policy Of attempted domination
by the federal reserve board and
banks over non-member banks by
coercive and oppressive methods; the
announced policy to enforce uni
versal par clearance of checks by
methods described by the federal re-
serve bank in itself is embarrassing,
annoying and expensive and we de-
nounce same as both Illegal and
wrong; proper administration and
necessary amendment is necessary to
the federal reserve act, and we ask
congress to investigate the fedora
reserve act relative to the following
details:
Charge Coerc1ve Methods
Coercive methods to force nor
member banks to become members a.;
substantial competition of federal re-
serve banks with their own member
bank; open market transactions; the
enormous earnings Of the federal re-
serve banks amounting in 1919 to
$9S,000,000, on a. paid up capital of
$S7,000,000; relative salaries and
bonuses of officers and employees
compared with private institutions;
oppressive policies toward member
banks under guise of corrective
measures; attempted destruction of
independence of great state bank
systems; intimidation Of directors of
federal reserve banks to prevent
many from performing the func-
tons imposed by law; effort to force
the diversified business of the coun-
try to conform with rigid rules and
standards determined and announc-
ed by the federal reserve board; re-
fusal to re-discount for member
banks certain paper which did not
conform to federal reserve board rul-
ing; the refusal of federal reserve
banks to make loans on Liberty
bonds; the unwisdom OF the announc-
ed policy to spend any amount of
money to collect checks from non
member banks rather than pay ex-
change.
State Represented.
% Tho bankers representing the
banking associations of Louisiana,
Mississippi, Alabama, Georgia and
Florida, the states comprising the
sixth federal reserve district, are
combating the orders of the federal
reserve board to all banks to make
remfttances to the federal reserve
bank of the district at par. The &C
ton of the federal reserve board was
bitterly debated by the assembled
bankers. kilograms from the bank
ing associations of the seven states
not: represented were received and
each expressed cooperation with the
plans.
Bankers also were present from
Tennessee, Texas, Kansas, Oklahoma,
Arkansas and South Dakota.