The Morning Tulsa daily world. [volume] (Tulsa, Okla.) 1919-1927, 1922-07-27
A SERIOUS SITUATION.

The letter Of Secretary Fall OF the interior
department to the attorney-Ecneral OF okla
hpma on the banding situation in this state.
published exclusively in The world wednes-
day, calls attention in rather startling way 20
tho gravity of the state banking system and the
possible iamcntabls consequence 90 banks in
general.
II has been the practice of tho interior de-
pnrtment to carry tho moneys derived from In
dian lands In tho banks OF the state, no par
TALLY being shown national banks. owing TO
the large number OF failures Of state banks and
the scandalous circumstances attending many
OF these failures tho interior department has
been compelled TO take official cognizance OF
tho situation. Owing further TO tho policy OF
tho state administration to throw technical diff
flcultlcs n the way OF every effort on the part
OF the federal government to protect itsolt re-
cover the funds OF its wards and safeguard IT.
self more adequately In tho future. the depart
Fient has reached the conclusion that II will
remove Indian moneys from the banks of the
state unless there Ia n complete reversal OF pol
icy by the state administration.
The interior department has been forced TO
this conclusion by the refusal OF the various
legitimate bonding concerns to further bond
state banking institution in favor of the United
States and MS n guarantee that Indian funds de-
posted with such state banking institution viii
be secure
1T IL as easy TO understand that the removal
OF some twenty-seven million dollars from the
banks OF oklahoma will be very disastrous to
the general welfare OF the state as II In to jus
tify In all general respects the decision OF the
interior department, However there Is ono
phase OF the matter that is not clear
Whatever sad experience the interior depart
nent has had with the state banks in this state
however obJectlonM such institutions arc TO the
various bonding concerns. It does not appear
that any of these objections sith"r In the case
of tho interior department or the bonding COM
panies applies to national banks in Oklahoma,
There have been only few minor national
bank failures, and none far known in
which scandal played important part. OF
course the national banks beyond the ju-
risdiction OF tho state banking board.
Therefore that part OF the secretnrys letter
threatening the withdrawal OF all Indian moneys
from the state and their deposit in the federal
treasury, does not appear TO be justified. why
should the national banks OF Oklahoma and the
general commerce ana Industry or the state be
punished for the palpable delinquences OF ths
state banking system?
II the state banks have proven untrust-
worthy in caring for these trust funds. OF course
they should be eliminated from consideration
in tho future: at least until such time as the
required change IN policy has actually taken
place. But there Is reason why the national
banks should not be continued az repositories
at least reason that has been stated.
As a matter Of cold fact In Wow of the scan
dal that has constantly attached TO the state
banking system since It became part OF the
political machine, II is difficult 10 justify the
department in ever recognizing state banks a,
repositories for indian funds, explainabe only
on the theory that bonding companies under.
took 10 mako the federal interests secure and
the natural disposition to he impartial in IN,
interest OF harmony between the state ana fed
eral jurisdiction.
Now, however, that the action OF the bond
ing concerns and the state authorities have mad,
a continuance OF such practice impossible. the
logical thing for the department 10 do Is e
continue the national banks OF the states de-
positorles and exclude the state banks. Til,
World can see justification for the remova
Of these moneys from the state.
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