Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1936-08-20
New Deal Saves
DepOsit0rs Thru
Bank Insurance
Panics Which Threaten e d
Hoover Regime Being Stopped
Before They Start
PmbIcitu Bnfeaas.

WUCtOtJY ONf 0NttS
Democratic National Committee
The friendly hand of Uncle Sam
was stretched out last week to rescue
thousands of bank depositors from
the effects of two bank failures in
eastern States. Had it not been for
the protection afforded by the Roose-
welt Administration, through passage
of the bill providing insurance fol
bank deposits up to 5000, every one
of these depositors would have
watched his life savings disappear
when the banks went to the wall. In.
stead, they were paid off at the rate
of 100 cents on the dollar within two
weeks after the banks closed theil
doors.
The first failure was in the little
town of East Hampton, in Connect
cut. The local bank and trust COM
pany, with several thousand poor de-
positors, was the victim of dishonest
officials and was obliged to close. Il
was one of the few bank failures in
America since President Roosevelt
took office. The little community
was panic-stricken at t he disaster
but Gained down when agents of the
Federal Deposit Insurance Corpora.
ton appeared and took charge of the
banks tangled affairs.
The other bank collapse was ii
Newark, N. j. There the D'Auria
Bank and Trust Company, in a
crowded Italian neighborhood, crash
ed few weeks ago. AS in the Con
necticut failure, most of the deposit
ors were poor working people, who
had placed all their meagre savings
with the institution. After the bank
was closed officers were arrested
charged with making false state
ments to the banking authorities
The widest excitement prevailed in
the Italian quarter of Newark. But
the soothing influence of Uncle Sam
was soon felt. Agents arrived and
took charge. Last Thursday FDIC
checks were ready and hundreds
called to receive payments due them
Watching them, as they stood in line
was Simon Kesselman, formerly gen.
eral secretary of the United Deposit
ors' Committee of the Bank, of Unit.
ed States, which went to the wall. in
Manhattan several years ago with
staggering losses to more than 400,-
600 depositors. eff we only had had
that Federal insurance of deposits
when the Bank of the United States
closed up!" he walled.
Most of the depositors of the
Newark bank probably had nc
clearer conception of the operation
Of the F. deral Deposit Insur-
ance Corporation tina n their fell
low sufferers in Connecticut. They
did not seem to know where the
money to pay them was coming from
In fact, they did not appear to care.
They only knew that they were get
ting every cent that was due them.
With that they were content.
Actually, however, the money paid
out will not be a dead loss to Uncle
Sam. AS the law operates, the Gov
eminent takes an assignment of de-
positors' claims and collects as much
as possible from the banks assets to
reimburse the Federal Treasury. In
the meantime distress of depositors
is relieved and confidence in other
banks maintained. Thus, bank panics,
which frightened the whole country
during the Hoover regime, are stopp-
ed before they start. If this were
the only accomplishment Of the
Roosevelt Administration, it would
be sufficient to constitute a valid
claim upon the nations gratitude.