Evening star., 1933-05-23

private banks are not subject to ex-
animation but the superintendent of
banks of New York is empowered to
make an examination to ascertain II
the nature Of the business makes 1t
eligible for examination.
They are constantly under an invi-
tation to make such an examination,
but the practices of our firm are such
as scarcely to arouse any question in
the mind of the examiner"
"Is there any minimum sum that j.
P. Morgan 81 Co will receive as a de-
mand deposit?" Pecora asked Morgan.
We don't like to take little deposits" /"
Morgan said, "a couple OF thousand
dollars roughly, but it scarcely goes
that low"
DO you report your condition every
year In great detail to the Federal Re
serve Bank Of New York;" asked
Pecora.
1T is done because the bank felt it
should be In a position to buy our bills,
great detail for the last five years"
You know that report is in strict
confldence2"
II know It,"
Does the Reserve bank make any
investigation Of its own2" asked
Bulkley.
mo"
Have the New York authorities ever
investigated the company" Reynolds
asked.
mot that know Of"
Never Checked Statement.
Does the Federal Reserve Bank
check your statement" asked Couzens.
NO" Morgan replied. They have
never asked"
They are very meticulous about ex-
amining statements Of incorporated
banks; I was wondering why they are
so lenient with Morgan g. Co.." Couzens
rejoined.:
Morgan leaned forward TO answer
this question, but Glass broke in to say
the Reserve bank had no legal right
to examine.
McAdoo commented that such exami-
nations rarely are made.
They examine the bills rather than
the bank" Glass said.
Morgan never did get In his answer,
but leaned back smiling while the Sen
ators discussed 1t for him.
In response to Pecora, Morgan read
the long list of directorships that the
partners in the great financial house
hold.
It took at least 10 minutes and the
committee members relaxed during the
reading. Morgan put on pince-nez
glasses and held the bulky list close
to his eyes.
Pecora, meantime, checked with a
similar list Of his own. The head OF
the House Of Morgan detailed firm
after firm. 1t read like list of the
industrial corporations of America.
Lists of the depositors are public in
formation and Pecora merely asked to
have them read to get them into the
record.
Morgan read the name of Henry s.
Morgan from the list, and Pecora
asked, "Is he related to you2"
my son." smiled the witness.
There were many utilities concerns
In the long list.
Pecora questioned about members Of
the London branch who were not
partners in the parent firm and the
Philadelphia affiliate.
Morgan named several among them.
E. C. Grenfell. member OF Parlia-
ment."
How does he get elected?" queried
Senator Gore.
From London" laughed the witness
heartily. adding that Grenfell was also
a director of the Bank of England.
rs it desired to have these direc-
tors-men who are members OF your
firm-on these various boards because
YOU transact business with them and
make loans?" Glass inquired.
Il think the real reason" Morgan
said. lis that we feel responsibility
for them, or toward them. In other
words We feel obligated to give them
financial advice and counsel If they
want it,"
DO you dominate policies of the con-
Germ on which you have directorsT
McAdoo wanted to know.
I'VE have no more domination than
one vote gives U.S." Morgan told him.
The witness then detailed Paris part
ners in the New York and Philadel-
phia firms. He named among them
j. r. Carter and B. s. Carter.
Pecora asked about deposits Of the
Morgan Co. with Morgan 81 Grenfell
in London. Morgan said they kept de-
posits there, but was unable to give
any amounts. Whitney said they were
lust working balances.
when you make returns, does the
Internal Revenue Bureau come down
and audit your books?" Couzens asked.
Yes"
who determines the policies Of your
London ofice?" Pecora asked.
Chiefly the London partners" Nor