The New York herald., 1920-12-03
WARBURG TO HEAD
ACCEPTANCE BOARD
Tells Members Serious Devel-
opments Threaten Amer
lean Bankers Bills.
DUE TO PRICE DECLINE
Foreign Buyers Have Tried to
Be Freed From Contracts
Representing Losses.
DUE TO PRICE DECLINE

Paul NJ. warburg, who was elected
president Of the American Acceptance
Council at its annual meeting held yes
terday. announced to the members that
certain serious developments threatened
the growth and standing of American
bankers acceptances. He referred to
the fact that the heavy decline in COM
modify prices had called forth attempts
on the part of foreign purchasers to free
themselves from contracts which were
bound to subject them to grave and. In
some cases even fatal. losses. Thus
purchasers have been induced to bring
pressure on our banks to refuse TO ac-
cept confirmed letters of credit which
had been issued for the purchasers ac-
count.
Such bona fide purchasers of a bill
as bank or firm on the strength of the
confirmed letter of credit" said Mr..
Warburg, must be protected at all haz-
ards II the American dollars acceptance
Is to gain or retain a position as a
worlds instrument of exchange of equal
standing to the sterling bill" A bank
that dishonesty refuses to fulfil its OBJ
legations under such a contract because
1t or Its clients might suffer a loss or
because such customers bring pressure
upon 1t to disregard its sacred pledges
or even try to inveigle inexperienced
judges into granting injunctions in order
10 prevent a bank from giving it's ac-
ceptances. Mr. Warburg thought, ought
to be held up to public contempt. Any
bank he said, found to connive or in
duige In such immoral practices ought
soon to learn that its acceptances have
become unstable in our own market as
well as in foreign lands.
Mr.. Warburg declared that the coun-
ell would do its utmost to throw light
on immoral practices that courts, the
legal profession, banks and the public
might understand fully what the prob
lem involved. The council, he said,
would emphasize to buyers Of American
bankers acceptances that the law fully
protected them In the same manner as
did the British law, no matter to what
temporary subterfuge a disreputable
drawer or acceptor might resort.
AS the result OF the annual election,
Mr.. Warburg succeeds as president
Lewis E. Pierson, chairman Of the board
of the irving National Bank. Other Of
ficiai Changes were as follows: Fred
I. Kent, vice-president Of the Bank
ers Trust Company, was elected chair
man of the executive committee. sue
ceeding Mr.. Warburg. Other officers
elected are: Vice-President, William H.
Porter, of J. p Morgan & Co.; secre-
tary. Robert II. Bean; treasurer, Percy
H. Johnston. president of the Chemical
National Bank; first vice-chairman
executive committee, Albert Strauss. Of
J. & w. Selgman G. Co. ;ssecond vice.
chairman. Melvin A. Traylor. president
Of the First Trust and Savings Bank
Of Chicago.
The new members of the executive
committee of thirty-six are: Joseph A..
Broderick. vice-presdent Of the Ma
tional Bank of Commerce in New York;
w. Irving Bullard, vice-president of the
Bankers Trust Company; Gerhard M.
Dahl, vice-president of the Chase Ma
tional Bank; John S. Drum. president
Of the Mercantile Trust Company Of
San Francisco; Maurice L. Farrell, F..
S. Smithers & Co.; Thomas B. Nc
Adams, vice-president of the Merchants
National Bank of Richmond, Va: w.
L. McLucas, president Of the Commerce
Trust Company of Kansas City; Charies
T.. Spencer. Jr., vice-president OF the
First National Bank of Boston; John
w. Staiey. president of the Peoples
State Bank of Detroit; Eugene v. Stet-
son, vice-president of the Guaranty
Trust Company; Albert Strauss. j. &
w. Seiigman & Co.: Gilbert Thorne.
vice-president of the National Park
Bank; T. H West. Jr., president OF the
Rhode Island Hospital Trust Company
of Providence.