Jamestown weekly alert. [volume] (Jamestown, Stutsman County, D.T. [N.D.]) 1882-1925, 1921-03-10
GRAND JURY ACTlQlr<'
HOUSE Re- 55RT URGES
Revelations Of Probe Demand Criminal Prosecution So
cass Turned State Government Into Orgy of Financial
Deirium,' the Report Concludes.
II CONCLUSIONS OF HOUSE
INVESTIGATION COMMITTEE

bill for vast losses caused Nv tne
Industrial Commissions "orgy IT
financial delirium".
The evidence taken at the in
vestigation will be available to the
states attorneys Of the counties
involved and the question involv-
ing the criminal features would
probably be subject for grand
jury investigation therein.
The system whereby funds can
be transferred from one department
to another is dangerous.
The Bank, Of North Dakota has
failed to maintain a proper reser-
We.
The Bank of North Dakota has
not made truthful statements Of
the report Of its conditions
.This omission to state the
truth concerning the banks posi-
tion is a very material evidence Of
the careless and lawless manner
pursued in the conduct Of the
banking business, and indifference
Of the registered officers Of the
bank in their responsibilities to
the public which made the bank
possible"
The report considers the rea-
sons why the state bonds have not
found a ready market, as follows:
Failure to provide and protect
sinking and interest funds to those
bond issues.
Granting abnormal powers to
the Industrial commission and the
Bank Of North Dakota to transfer
and divert monies of bond sinking
and interest funds to other pur-
poses.
The report refers to the offer of
Charles Ponzi, to assist in the sale
Of the bonds as follows: ''The spec
tacle of having the good name of
i North Dakota held up to ridicule
by the alleged offer of a most mo-
torious swindler who ia under Jail
sentence, for fraudulent use Of the
mail, offering his service in the
sale OF these bonds"
In reference to the League meth
cd Of financing, the report says:
''1n financing the various lea
quo concerns and the political
campaigns conducted by the lea
CUE, Messers. Lemke and Townley-
ley perfected a scheme whereby
they obtained notes from farmers
throughout the state by way of
accommodation, and III exchange
for the individual notes Of Town
ley and League. corporations. In
addition thereto farmers have
been induced to give post-dated
checks.
This accommodation paper
was accumulated in large amounts
and great flood Of it was placed
in the various banks of the state
affiliated with the league as coll
lateral to loans to the League and
its subordinate kindred corpora
tions.
"The most striking and typical
example Of this practice is to be
found In the record Of the Scandin-
avian-American bank Of Fargo,
where, the evidence discloses.
many thousands of dollars Of farm
ers accommodation notes and
large quantity of post-dated
checks were held as collateral to
excessives loans to the Consumers
Stores company, and the League
Exchange.
"The practice is doubtless con-
tributing cause to the present in
solvent condition of many affiliat-
ed banks. The law of self-preser-
vation and the original under
standing, together with the fact
that they received absolutely
nothing from the proceeds OF such
notes, will force them to refuse
payment and stand suit
Attorney General Lemke was
subpoenaed to appear before the
committee and refused to come.
Governor Frazier was invited to
come and did not. H
The investigation was an open
and fearless one. regardless OF mat
sters Of purely personal or parti-
san character.
That the report of Bishop. Briss-
man & Co., on the state industries
was accurate.
.s5y. II he resignation OF j. Il. waters,
first manager OF the State Bank,
was demanded by A. G.. Townley
because he refused to divert state
money to the Scandinavian-Amer-
lean bank \ ,3 .,,s; &. 455
That political favoritism was
shown in the re-depo positing Of
state money from the Bank Of
North Dakota. 85 1S
These impractical theorists
have launched the state into an
orgy OF financial excess and q de-
lirium of 4 alistic expe rimenta-
ton born ins heat and nutured In
pref udice and the results pf which
are such that II, will require years
iof conse ervative practical admin
istratt Ion of public affaiTs Is. elm
mate the nefari rious cons uencess I
resultant theref 81. .'s's says the
committee A tho con ein DIM Epar-S
agraph sof its report & II. s;s M 1sss
yalys st4tsss nsys I: 4 II B6n.
lses tx former service naSh