Evening star., 1933-08-23
FATHER COUGHL|N
DENOUNCES BANKS
Judge Rules Today on Fur.
ther Efforts for Hoover
Testimony.
Continued From First Pase)

CONTINUED From First Page.)
tell the truth" Coughlin continued
Actually the bank had but $99 ,3O2, ,8O8
in cash and Government bonds. was IA
per cent liquid and its fund to meet
general deposit Withdrawals was not
more than $40 100000"
wrecked before Roosevelt took office, "
Father Coughlin exclaimed:
They were wrecked by the phi
losophy that money in the hands OF
the masses was menace"
Hoover Replies.
In q 600-word telegram to Prosecutor
Harry 8. Toy late yesterday, the former
President said he would be able to fur
nish the investigators only with general
and mostly second hand" information
which, he said he believed, was INSULT
cient to Justify q trip to Detroit He
assured Prosecutor Toy that he had no
objection to furnishing any information
which he properly" could.
Mr.. Hoover's message arrived Q fsW
hours after Prosecutor Toy had d1-
patched an earnest request" that he
come to Detroit as soon as possible to
testify. Immediately thereafter, Prose-
cutor Toy and Judge Keidan went into
conference, the latter saying he would
announce his plans today.
Tuesday saw the final appearance OF
United States Senator James Couzens
Republican, Of Michigan, at whose sug-
Sestlon Mr.. Hoover was asked to ap-
pear. The Senator wound up his -four
-
his charge that "an attempt to make
millions without really earning them
by consolidation and pyramiding OF
banks without the depositors' consent
was the specific cause for the closing OF
the two big national banks.
The Nationwide depression, he said
was the general cause OF the shrinkage
OF assets, but he insisted the two banks
would not have closed had they been
as sound and well managed as they
should have been"
Charges Bad Loans.
The Senator also charged that so
much money had been loaned by the
two banks on Detroit Bankers Co. and
Guardian-Detroit union group stock
that the banks dared not sell the COL
lateral when the loans fell due. He
charged such loans constituted viola
tlon OF the banking laws in that the
banks were In effect loaning depositors'
money on the banks own stock, since
the two banks were owned by holding
companies.
AS result Of Senator Couzens' testi.
mony. the jury has decided to call al
least 40 additional witnesses. necessi-
tatlng an extension Of the inquiry fol
at least three more weeks
The information sought from Mr.
Hoover by the Detroit investigator con-
cerned the attitude of administrative
agencies OF the Federal Government
toward to two closed Detroit banks pre-
vioas to March 4, 1888, during the
Hoover incumbency.
Text Of Hoover Reply.
The text of Mr.. Hoover's telegram te
Prosecutor Toy follows:
II have received from the press 6
copy Of a letter addressed to me by
yourself, requesting that l should come
| to Detroit as witness in the inquiry
you are conducting in respect to the
closing Of the Michigan banks last Feb,
ruary.
Detailed and competent information
as to the relation of Federal authori-
ties to the events leading to the closing
Of these banks can be obtained only
from the former officials of the Re-
construction Finance Corporation, thu
Federal Reserve Board. the then con.
troller of the currency and from tht
record.
My recollection of my own connec.
ton Is that ON q Thursday evening
In February the officials informed me
that the Guardian Trust Co. Of De.
troit was in difficulties. was undergoing
q rim by its depositors and that should
| it close it would precipitate Q panic
run on other. Detroit and Michigan
banks. The impression I received from
them was that the other leading banks
Of Detroit had not been subject Il
runs and were able to meet their de
posit responsibilities if there was M
general panic in the city. although they
necessarily had q number of slow as
sets in Detroit real estate mortgages.
Uniformed Of Situation
II was informed the Guardian Trus
situation was such that even with thl
utmost Of Government assistance pos
sible under the law it would be insufh
cient without outside help and reorgani
zation internally The request of thes'
gentlemen, and understood. of lead
ing men In Detroit, was that I shouls
endeavor to bring about cooperation
Of outside banks private interests. anl
leading depositors to reorganize tn,
trust company and thus prevent {
crisis In that city We had success
fully secured such action on simila
occasions in other cities and prevented
enormous losses.
Il and the other officials devoted our
selves increasingly during the followini
48 hours in many directions to building
up the cooperation necessary to say,
the situation, and 1t was continued unit
1t was brought to q halt by the de
termination of the Governor that it wa
wise to close the whole Of the Michigan
banks.
| LAS have said. the details Of thes,
plans and negotiations and those sub
sequently developed by officials of tn,
Reconstruction Finance Corporation
the Federal Reserve, and the Treasur!
for reopening of the Michigan bank
can only be had from the then oficial!
Of those organizations
II have no objection to furnishini
any information which properly car
but such information as I can give Il
only general and is mostly second hand
and Is insufficient to warrant a journey
to Detroit, and can be more effectively
given by the oflcials mentioned. an
sure 1t Is fully available to you"
TO PROBE CLEVELAND BANK.
u. s. District Attorney Saws Fedora