The Abbeville press and banner. [volume] (Abbeville, S.C.) 1869-1924, 1921-04-18
ATLANTA RESERVE
BANK is CHARGED
WITH CONSPIRACY

sS
Sast the officials of the federal re-
serve bank Of Atlanta, Ga, "acting
IN concert with reserve banks OF
e*her districts" have Joined in a
conspiracy to force small banks
throughout Georgia to become men,
hers of the federal reserve system
were pressed before the Supreme
Court today by counsel for the Am
erica Bank and Trust Company OF
Atlanta and more than 40 other in
stitutions.
eThis action is to be compelled re-
Esrdless of its ruinous effect upon
county banks and the destruction OF
saeir usefulness in the small commu-
mites they serve" the court was told.
Opening of the case today mark
I'd the final round of the "par col
lection" fight involving the right OF
tse federal reserve board to insist
upon collection of members checks
without deduction of. the nominal
charge from which, it was explain
ed. most banks obtain a large part
vi their revenue.
The case came here IN appeal
from a decision of the federal courts
qf Georgia, which, sustaining a de-
uurrer Of the board, dismissed the
xu7It "as wholly lacking in equity"
The state banks ask that the tempo
rsry restraining order now prevent
ing the Atlanta reserve bank from
enforcing the par collection order,
BE made permanent.
The government, through Solici-
for General Frierson, assisted in the
separation of the reserve boards
ease but took no part in the argu-
saent. Chief Justice White allowed
in extra half hour to the issue which
he believed to be unusually impor-
tant.
Georgia Banks Side.
The Georgia banks, counsel for an
peIiants said, care not seeking to
shasge reserve banks for remittance
IT proceeds of checks drawn upon
shem but are insisting that under
Ia law .reerve banks are not permit
ted to receive for collection checks
drawn upon non-member banks be-
cause, the latter are authorized by
p. Section Is of the reserve act to
charge for services rendered and by
The same section reserve banks are
prohibited from paying any such
changes"
IF the statement made in the re-
serve bank brief is true that the cost
IT clearing checks is largely borne
b. those banks then a violation of
she law is confessed, it was explain
I'd, afor the expense is wholly un-
authorized and is, in fact, specifi-
szHy prohibited.
Hollis N. Randolph, solicitor for
the federal reserve board, denied the
conspiracy charge and stressed the
saving to the country which has re-
Salted from the par collection policy.
During 1919, he said, transactions
through the reserve machinery ag-
Hegated seventy four billions at a
cost Of $250,000 to the banks,
whereas under the collection system,
exchange and charges would have
amounted to $74,OOo,o00.
The case for the federal reserve
system, as presented to the court,
vas succinctly as follows:
"Federal reserve banks have the
right and duty to accept checks on
whatever banks drawn; clearing of
these checks must be in the manner
prescribed by law; since the law pro-
hibfts any charges, the federal
banks must insist on par collection"
I'VE submit that if the acts done
b lawful, the courts cannot inquire
into the motive! Mr.. Randolph in
sisted.
" A threat to do q lawful thing
which might deplete to some extent
the profits Of a bank adds no ele-
neut of actionable WRONG"
Stereoptican slides, depicting ami
nal, insect and plant life, are avail