The Waterbury Democrat., 1933-05-24


 been repaid.
 Charles E. Mitchell, former head of the National City Bank of New York, now on trial in New York on income tax charges, was includ- ed in the group, with no notation of a repayment.
 The Mitchell loan, it was reveal ed later, originally amounted to to about $6,0O0,00O within a week.
 The collateral at that time amounted to about double the amount of the loan, the witness, George Whitney, said. Whitney explained Mitchell sought the loan when leading Wall street bankers came into the mar ket crash after four days of col lapse. gro make some order out of the chaos in the 12 market crash.
 Ut was not to stabilize the mar ket," he said, but to create a market"
 The list was made public over the protest of Morgan and his counsel, John W. Davis. They objected yesterday, when Morgan testified that some of the loans were overdue and that collateral deposited at the time had depre- ciated until, in some cases, it was no longer sufficient to cover the amount due.
 Another list, showing the names of those who have benefited by privileges which permitted them to buy securities at bargain coun- ter" prices, was to be introduced later.
 Richard Whitney, president of the New York stock exchange, was included in the loan list, as was Myron c. Taylor, Identified as chairman of the board of the United States Steel corporation and a director of the First National Bank of New York. The Taylor loan was repaid but the list showed the Whitney loan still outstanding. The unpaid loans numbered "A, about one-third of the list.
 Ambassador Davis was identified as connected with the Bank of New York and Trust Co.
 "When was the Norman H. Davis loan made?" Ferdinand Pecora, committee counsel, asked Morgan.
 "This list doesn't say" Mor- gan replied.
 When was the F. c. Dumaine loan made?"
 "It is long story" interposed George Whitney, Morgan part ner.
 Pecora then asked about the Mitchell and Seward Prosser loans, but Morgan said he knew nothing about them.
 Pecora decided to discuss the loans later when Whitney testifies.
 Dawes repaid the Morgan loan before his bank, then the Central Republic Bank & Trust of Chi cago, received a $90,000,00O loan from the Reconstruction Finance corporation.
 Tho R. +. c. loan was granted in two parts, $16,00O,O00 on June 25, 1882, and $74,000,000 two days later soon after Dawes resigna- tion as ambassador to the court of St James.
 After Morgan had been asked re- garding the practices of private bankers, and had said that the be- lieved state and federal supervis- ion was not necessary, Pecora brought LHe QueStlOuiuS diouAN " the Mitchell loan.
 Morgan said he was unfamiliar with 1t and Pecora called George Whitney, Morgan partner ana brother of the president of the New York stock exchange. Whitney defended the loan as one made on an emergency basis dur ing the stock market crash of 1929. Pecora asked if the Mitchell loan was er-collateralized. Whitney said it was. He explained that 1t had a mortgage on the Mitchell home only because 1t was put upon on a call for additional collateral. Morgan does not make real estate loans generally, he explained, but added that he has quite bit now. Whitney called to stand during Morgan's testimony, said that members of the Morgan partner ship paid on 1929 income an ag- gregate of $11,000.000.
 Since then" said Pecora, "very few of your partners have paid tn- come tax at all up to the present time."
 Whitney said he had learned that yesterday"
 After the loan list was intro- duced Pecora turned his attention to the position of the Morgan banks fin relation to the New York state banking authorities.
 Are you familiar with the New York state law governing the a- mount of loan to Do made to an individuaiY" Pecora asked.
 'T am roughly familiar with them," Morgan answered.
 "Are you convinced they arc wIsaf"
 "I hayo DO opinion"