The Washington times., 1922-09-07


The referendum is based upon
q report made to the national cham
Der by a special committee which
made an exhaustive study of every
phase OF this question. In the
opinion OF the committee. the prac.
tice OF certain banks in making
u charge usually X to 1-1O of one
per cent in remitting to their re.
serve bank in payment of checks
drawn upon them by their depos'
itors, should be discontinued and
par remittance be made universal
Banks Remitting at Par.
In its investigation, the committee
found that not only the 9,726 mem.
Der banks In the reserve system
i92 nonmember banks, whereas the
number of nonmember banks not
renting at par was 1882.
IF charges were actually made by
all banks remitting to reserve
banks" 1t is pointed out by the com
mittee, their aggregate would be
very large and a burden upon com
merce; for the total items handled
by reserve banks in 1920 reached
$157, 900 900. 900. One-tenth of / per
cent would be $157 900. 900, on this
Volume. If only the interest Of the
sbanks which now would be A57,
100000 on this volume. 1t is obvious
they would not profit through a
system under which all banks made
charges for remittance; for the cost
OF collecting checks deposited by
their customers would then be as
great as the amount they would re.
ceive from remitting against checks
drawn by their customers.
THE committee is of the opinion
that this problem should be solved
from an economic standpoint rs
speedily as possible and has little
fear that the laws passed by six
States in an endeavor to support
non-member banks in their charges
for remittances will be pushed in
legislatures of other States, or can
have considerable effect. The ques-
tions at issue are national in char.
acter and il they cannot otherwise
be solved they should be settled
through national legislation.
No Legislation Needed.
However, the committee does not
believe that further legislation IL
Necessary. Its consideration of the
subject from every point of view
leads 1t to the conclusion it has indi-
Gated above, and 1t recommends that
without further legislati ton par remit.
tance in payment of check should be
made universal throughout the
United States. II par remittance
capnot, however, be made the univer-
sal practice in the way the commit.
tee suggests, the committee recon-
mends that par remittance be made
compulsory for all banks. whether
members or nonmembers of the Fed
eral Reserve System, by affirmative
and adequate enactmenX of Con.
gress."
The members of the committee
who signed the report were: Gran.
ger A. Hollister. chairman. manu-
facturer and banker, Of Rochester:
George e. Barnett, economist, Of
Baltimore, professor in Johns Hop
kins University; Ralph E. Heilman,
economist. OF Chicago, dead. School
school of commerce, Northwestern
University; J. S. Mccullough, hank
er, of Philadelphia; F. II. Mont.
gomery, manufacturer. Of Brook
lyn; j. II. Scales, wholesale mer-
chant. Of Louisville: Joseph B.
Shea, merchant, of Pittsburgh;
Capt. Charles II. Teal. merchant
and planter, of Colfax, La; Robert
H. fireman, banker and manufac-
turer, Of Ithaca, N. Y.
There was one other member on
the committee, James s. Peters, a
banker of Manchester. NGa. Mr..
NPeters dissented from the views 81
the other members.