The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-04-06
UNIFIED BANK
. SYSTEM, GOAL
OF ROOSEVELT
Strict Federal Supervision
Included in Legislation
Being Drafted.
GLASS BILL is BASIS
Reserve Membership viii
Be Made AIIuring to
State Institutions.
BY RAY TUCKER
Times staff Writer

WASHINGTON. April GA vir-
tually unified banking system under
federal supervision will be the aim
of permanent banking legislation
now in preparation by President
RooSevelt's advisers and the senate
banking and currency committee.
Although full details are withheld,
it was learned today that member
ship in the federal reserve system
will be made so alluring that non
member state banks undoubtedly
will deem it advisable to join. This
method has been tried in the past.
and the banking crisis revealed the
value of reserve membership.
The committee has legal advice on
means of forcing state banks into
the system, including such drastic
proposals as elimination of use of a
checking mechanism by non-mem-
Der institutions, but nothing of an
arbitrary nature is contemplated.
Glass Bill Is Base
The original Glass bill will furnish
the basis for the new legislation.
including far-reaching provisions
eliminated before it passed the sem
ate last session. These break up
all interlocking directories, as
urged by President Roosevelt, and
prohibit bank depositors from hold
ing dictatorship in an industrial
corporation.
Other provisions provide regula-
ton of private banks, if it can be
effected, and Stricter control of
banking operations will be included.
The bill as it passed the senate
will be utilized, including require
mentS for enforcement of banks and
investment aff1liates, extension of
chain banking, and greater control
over recalcitrant directors.
1t also is understood that the adj
miniStration looks more kindly on
some form of guarantee or insur-
/ ance of bank deposits than it did
originally.
awaits morgan Probe
Although detailed framing of the
bill waits upon investigation of j.
P. Morgan IL Co., and other great
private banks, it will provide for
sharp limitation on their activities.
1t may, for instance, subject private
banks to the same regulations as
commercial institutions and prohibit
deposits in security corporations or
partnerships.
These reforms have been slg
gested by the administration and
they commonly are known as the
"Aldrich program" Although thew
were proposed by w. w. Aldrich.
board chairman of the Chase Ma
tional bank and Rockefeller spokes-
man, they were advanced by Sena-
tor Carter Glass Dem, Va long
ago. Representatives of the Chase
National bank fought them bitterly
for the last two years and eventually
succeeded in eliminating them from
the original Glass bill.
Divided Over Inquiry
Az @Al0A I'LL IC1Ol were I1Ob DIO-
posed until after the committees
investigation of the operations of
the National City bank and its in
vestment company, which resulted
IN the resignation and indictment of
Charles E. Mitchell, former presi-
dent.
Meanwhile, some division has
arisen in the banking and currency
committee as to whethert he inquiry
into Chase National should be
pressed. In view of Mr.. Aldrichs
change of heart, some members
think his bank should not be inves-
tigated
But others, recalling certain reve-
lations during the foreign loan in
quiry, insist that Chase Nationals
operations be examined along the
same lines as National City's were.