Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1921-02-18
FORMER TESTIMONY
NOT ACCORDING TO
HIS OWN JUDGMENT
Denies Attempt to ''Fool
People" Despite Language
of Sworn Testimony.
CATHRO is ALSO ON
STAND AGAIN TODAY
Lofthus Fails to Appear To-
day; Has Not Returned to
Bismarck.
CBy Staff Correspondents J

Nby Staf Correspondent
Bismarck, N. D., Feb. 1s.-Driven
into a corner today by Francis MUIR
phy' attorney for the house audit
committee. NJ. W. Thatcher, president
OF the Equitable Audit company of
minneapolis and Fargo, today admit
ted that the testimony he gave We'd
nesoay regarding the reserve of the
1ank OF North Dakota did not in
reallty represent his judgment in the
matter. 40 .11e
Ignored Law.
He admitted that in figuring tho To-
gal reserve required by the bank. had
II peen subject to the 1915 law re-
sardlng bank reserves, he had com
pletely ignored certain points in law
ana claimed that he had figured the
reserve entirely in accordance with
ene questions asked by ATTORNEY
Slnkler, who represents the Nonnar,
tlsan league majority of the senate
committee. 70
Strenuous Examination.
These admissions were forced from
tne witness by Mr.. Murphy only aft
er strenuous battle, as Mr.. Thatcher
seemed ny no means anxious to an
ney. a''oA
Thatcher on being put on the witt
ness stand today testified that he wa.
an accountant OF s years experience.
out was not a certified public ac-
countan1
he said that he was president of
the Equitable Audit company and had
beer the. founder of the Economy
supply company, which is now abb
sorbed by the Equitable Audit COM
pany.
Now" said Mr.. Murphy, 1.-The au-
dit of the State Home Building as
sociaion, prepared by Bishop Briss-
man d CO., showed that the Equitable
Audit company was paid $1,375.l6 for
accounting and installing a system of
accounts. and that the Economy Sup
ply company was paid $2.71S94 for
accounting supplies. In other words
the Equitable Audit company de-
signed the accounting forms and the
Economy Supply company furnished
them. Isn't this the fact?"
thatcher admitted that it was, but
vehemently declared that the Econ
omy Supply company had accepted
the contract only at the request of
robert Blakemore. manager of the
Home Building association, and in
competition with a number of other
firms.
Mr.. Murphy then took up Mr..
Thatcher's testimony before the SEN
ate committee which was that the
Bank of North Dakota had a reserve
Of over s7,o0O.00O figured on the ha-
Sis or the report of Bishop Brissman
& Co. and the 1915 law.
Included Retlcposits.
Thatcher admitted that in figuring
this reserve he had included all re-
deposits of the Bank of North Da-
kota in other banks of the state.
But the law provides that to fig
ure as reserve funds must be deposit
ed in banks which are themselves
fully protected by sufficient reserves
and you yourself testified before the
senate committee that there were
practically no banks in North Dakota
thus protected" Mr.. Murphy pointed
out. and Mr.. Thatcher admitted the
fact
1T also requires the reserves must
be deposited in banks located in COM
mercfal centers to facilitate en-
change the lawyer pointed out
How many of these redepository
! banks are so located ?" Very few"
admitted Thatcher
Did Not Dc0nct.
Did you deduct from the reserve
You figured the Bank of North Da-
kota had the amounts due to other
banks as the law requires" Mr.. Muir
ply asked. Thatcher admitted that
he had not.
In Figuring the reserve you includ-
ed funds in banks already closed and
insolvent, didn't you?" Mr.. Murphy
! asked. and the accountant admitted
that such was the case.
Mr.. Murphy then had Mr.. Thatcher
figure up the actual reserve which
the Bank of North Dakota had under
the terms of 1915 law and compare it
! with that required by the law for 9TH
cr banks. with the results already
stated.
! Mr.. Thatcher also admitted that
even under the methods which he used
| Wednesday in computing the reserve
of the bank the cash portion of the
reserve was over a million dollars
! short Of the amount required for 9TH
er state banks under the 1915 law.
! There is no contention that this re-
| serve law applies or ever applied to
the Bank of North Dakota, the idea
being merely to compare the condi-
| ton of the Bank OF North Dakota
with that of other banks in the state.
After Thatcher had admitted that
this testimony before the senate COM
mittee did not actually represent his
| judgment as to the condition of the
Bank of North Dakota reserve, Mr..
Murphy called his attention to the
transcript Of his testimony in which
he said that the reserve Of the Bank
of North Dakota was literally" more
I! than seven million dollars.