The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-03-29
ROOSEVELT TO
DEMAND BANKS
SAFETY LAWS
Legislation Will Provide
Severe Penalties for
Crooked FinanCierS.
BAD BONDS DOOMED
Investors Will Be Given
Protection Against Doubt
full Issues.
BY RAY TUCKER
Times Staff Writer

WASHINGTON. March 29.-Lcg-
islation bristling with penalties and
prohibitions against misuse of and
speculation with other peoples
money" by banks and corporations
soon will assume shape, as a result
of two moves made today by the
Roosevelt administration on the
financial front.
The President is expected to sub
NIT to congress a message and a
bill designed to protect American
investors from the devastating
losses they have suffered in worth
less issues floated by bankers for
insult, Kreuger and Toll, and many
South American governments.
Complete publicity concerning
such issues, together with provisions
for penalty and recovery in case of
fraudulent misrepresentation, is the
general objective of the honest
securities measure"
Offenders Face Penalty
For the purpose of framing leg
lSlatlOn, the senate banking and
currency committee has asked At
torney- General Homer Cummings
to submit penal statutes applicable
to officials and appointeeS of the
government and banks who violate
federal bank regulations.
This looks toward extremely dras-
tic regulation and punishment Of
violators in the permanent banking
reform legislation now under COM
mlttee consideration.
The committee also has asked
William H. Woodin, secretary of the
treasury, to appear before it Thurs
day with any recommendations he
may have. w. w. Aldrich board
chairman of the Chase National
bank of New York, who recently
proposed far-reaching changes re-
garding banks and f1c.ation of Sc
curities, spent an hour with Presi-
dent Roosevelt Tuesday.
1t is known that every one of
these moves is part of a plan for a
rounded and safer banking system.
Capitalization Is Sought
Although not openly featured, it
is understood that a real effort will
be made, through regulations and
statutes, to further centralize the
nations banking system.
The recent crisis convinced MANY
doubters of the necessity for a
unified system, and the committees
request for information on penal
provisions contained a significant
statement.
Besides asking for laws applicable
TO national and state member banks
OF the federal reserve, it said it
wanted laws referring to Others"
With the federal government hav-
ing authority over all banks as a
result of the emergency banking
act, it is felt that now is the time
10 go through with a permanent
| program.
DisavOw Silence Policy
A swift succession of events. in
Guiding bank failures and the ma
tlon-Wide suspension, terrific losses
anu LdIuSIllpS 10 innocent deposit
tors, disclosures of dishonesty and
stupidity in floating foreign and do
nestle issues, delays in prosecuting
certain officials, have strengthened
the desire for prompt action.
The administrations new program
marks the second step in two DAYS
to punish and prevent alleged dis
honesties or laxities. On behalf of
the President, Mr. Woodin served
notice that banking irregularities
must be called Immediately to atten-
ton of proper authorities for pros
ecution
He disavowed the Hoover admin
istration's policy of silence, based
on the fear that immediate prose-
cutlon might further upset the
banking world.