Evening star., 1933-06-26
DODDS AND NEELy
NEAR FIST CLASH
Former Resents Senator:
"WhiteWash'' Accusation
During Hartman Probe.
Continued From First Page.)

CONTINUED From First Page)
more liquid position than it then was
They told me of the impending prosecu-
ton of Hartman. They told me they
held no brief for Hartman and gath
cred they felt he was culpable and felt
he should be punished eventually.
They said, however, that if an in
dictment was found the bank was not
liquid enough to stand run which
would undoubtedly follow. Bisbee
the consequent closing Of its doors, be-
cause Of its non-liquid condition, might
well result In runs on a half dozen
other institutions and bring about a
major banking crisis in New York and
in the country.
II was impressed. I thought they
were right, and still think So I con-
ferred with the Treasury and learned
that the Treasury Department wanted
the prosecution delayed and also re-
quested that before We do anything
about the matter we give the Treasury
Department advance notice"
Holds Action Was Proper.
Dodds said we considered the facts
and decided it was proper to delay
prosecution. Accordingly, he said, he
gave such instructions to his own office
force and suggested to Assistant United
States Attorney Thomas E. Dewey in
New York that whatever steps neces-
sary to bring about the delay be taken
in New York City.
What had done" Dodds said, was
not an unusual thing. 1t was a proper
thing As it came up. it was a matter
that didn't even merit much time or
attention. I so felt at the time and
feel so now.
ANY unnecessary action in the way
OF prosecution would have been q ruth
less and savage thing to do as far as
the rights of the depositors were con-
cerned. This was a very common
thing. 1t was done frequently, not only
at the request of individuals and clear
ing houses, but of Representatives and
Senators. Some of the Senators on the
committee have made such requests"
After Dodds had testified for about
an hour. Senator Ashurst asked:
II have drawn this conclusion from
your testimony. whether your action
was Ill or well, you appear to assume
all blame Is that right?"
"Unquestionably, absolutely" Dodds
replied. Il had it in my hands to say
to the United States attorney here
whether to 60 ahead or not. said he
should not. I alone was responsible.
In fact, didn't even refer the case to
the Attorney General"
Senator Neely asked Dodds whether
he was aided in reaching his decision
by the assurance that the New York
Clearing House was in some way sup
porting the Hartman Bank.
That impressed me very much"
Dodds said.
Tells Of Prosecutions.
Don't you think" Nicely asked. "a
great deal Of the disaster that has come
to the banking world is because inside
interests have been wrecking banks?"
"A statement could not be made SO
far from the facts" Dodds answered.
Nicely then demanded to know how
many defaulting bank officers had been
put in jail during Dodd's tenure. Dodds
said there were 255 prosecutions in
1890; ATS in 1881, of which 80 per cent
were convictions, and 394 in 1882, of
which 297 were convictions.
Senator Nicely inquired whether these
convictions were of bookkeepers and
tellers or whether as many as 10 per
cent were OF bank presidents and
cashiers.
Il would be shocked to find that any
thing like 10 per cent were the offenses
Of presidents and cashiers" Dodds an
swered.
Medalie Gives Testimony.
Medalie was sworn and Senator
Ashurst asked:
Were you United States Attorney at
the time of any failure promptly to
prosecute violations of law in connec-
ton with the Hartman National
Bank?"
Il should not call it a failure"
Medalie replied, "but if you refer to the
fact that I was United States Attorney
when the Department of Justice re-
ceived word of violations of the law
the answer is yes"
Medalie testified that December %,
1882. he was informed by L. K. Rob-
ertS, chief bank examiner, that Bisbee
intended to take up with the Depart
ment of Justice the matter of withhold
ing from prosecution certain matters in
with the Hartman National
Bank" /
The United States attorney said he
left that evening for a vacation cruise, |
and when he returned q day or two |
after New Year, Dewey told him letter |
the Hartman case had been |
received. Medalie said the letter, sent |
by the Treasury Department. was dated |
July 8, 1882, but was not mailed until !
December % and was received the fol- !
lowing day
Dewey also said" Medalie continued. |
that he had received a telephone call |
from Dodds, the substance of which was |
that he had been visited by certain per-
cons, including Bisbee, and had been in |
touch with responsible officials of the
Treasury Department, and that on ac-
count of the delicate banking conditions
in New York and throughout the coun-
try, Dodds was of the opinion that we
should accede to the request that prose-
cution be temporarily withheld"
Medalie said it was pointed out to
him that the statute Of limitations
would not prevent prosecutions later.
and that the persons against whom
charges were made could be proceeded
against when the air cleared"
Il followed the suggestion or direc-
ion Of the Department OF Justice"