Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1921-02-04

checks.
@. think we are speaking at cross
fires. l am not speaking Of actual
money or evidence Of money. I want
funds in the bank, whether in the
form Of checks or some other form.
all Of its funds are derived from the
deposits in some form or another?
, A. Yes.
@. Now, let me ask you this ques-
ton. II it is not true that IS a result
of the transaction between the bank
and the Industrial commission that
two million dollars Of deposits Of that
bank were transferred into capital?
A. No.
Q. They were not?
capital? ''
A. Yes.
@. What?
A. The check of the industrial
commission given on the Bank of
North Dakota.
Q. Credited to capital account?
A. Yes.
Q. What was your counter entry
there, where did you get the money?
What account did you, charge the
check to? When you credited up
capital, where did o put your debit
entry? =.
A. The debit is a paid check.
@. A paid check?
A. Yes.
@. Haven't you any debit entry on
try to that W million dollar capital?
A. Not except the paid check.
Lemke Offers Suggestion.
@. Mr.. Lemke: May I suggest the
books are the best evidence of this
and I would suggest that vol will be
given full access to the books and that
you 60 down to the bank and specify
just what you want and I have no
doubt Mr.. Cathro will permit it.
MI. Murphy: I am very glad toSdo
that. am very glad Of the Suggest;
ton thai the books are theahest ssfAA;
dence and II you Will permit us to go
in n seq the original entries.
Mr.. Cathro: No objection at all.
MI. Murphy: You are very gener-
Mr.. Lemke: hope the. generosity
will continue so that laterron we will
be permitted to cross examine the
witness.
Mr.. Murphy: That is a matter for
the committee who employed me,
man ought not to cross examine his
own witness.
@. 1 dom believe we understand
each other. or perhaps we UNDER
stand zach other too well, I don't
know which. Nevertheless we are
not getting together.
"A. Well, the point is this. You are
off on the wrong tangent.
O.. Well, perhaps I am. Put me
right.
A.. You borrow some money at a
hank and you deposit that money to
your own credit in the bank.
G.. Yes:
volume of business.
@. The volume Of business or foot
:ngs? II. y
A.. Absolutely, but there mas been
no actual money added to the banks
assets.
@. Exactly. Now we are agreed
On that. but what I want to get at is
this. The check that was drawn for
two million dollars which you say
when it was delivered to you as di-
rector general was credited to the
capital account must have been debit
ed to some other account, must it no.?
There must have been something on
which that check was drawn. AS a
matter OF 1fact o just transferred it
from deposits and you Offset it by
putting In two million dollars as a
Two Checks Drawn.
A. When the transactions for the
purchase Of bonds were effected two
checks were drawn, cashiers checks
so called, one for v hundred thou
sand and n for one million five
hundred thousand.
@. To buy the bonds with?
A. The first five hundred thou
sand dollar check was sent up to the
Industrial commission by a messen-
-cr with the statement that we would
axe $780, 900 Of bonds in the Bank
IT North Dakota. They kept the
heck aud we Immediately charged
IL the bonds as an asset and then
.~edited it on our books as outstand-
rig. The. cashiers check then was
ratained for some period of time by
he industrial commission. 1t makes
~ difference how long, it is a separ-
-tc transactions. After that they re-
'nrned that check to us and we
srcdited capital and we charged
rashier's checks.
Q. And the same transaction took
rlace with reference to the larger
transaction. the million five hundred
thousand deal? gis 4
9: Ana that is al, shere was Of III
"a. And at the same time you-7
"A. We took the two million dollars
agcrth Of bonds.
so. And they became part of>your
sources to Offset the two million
o 4. Now. that is confusing The
bonds became part Of the
he same as farm loans and loans ia
bank. They have no connection with
capital whatever. They were bought
n,I roi6 for .9.F "a uH ~ 81 .FEl ss