The people's voice., 1958-04-11

the measure unimportant, for they
had put a quiet, all-out lobbying eff
fort to obtain its speedy passage.
PATMAN, GOES INTO ACTION
Patman repeatedly called these
facts to the attention of Chairman
Brent Spence (D-N.C.) of the House
Banking and Currency Committee
during many months of hearings. But
only after the hearings closed did
Spence ask the committee the law.
The staff discovered no less than lit
such changes. But it was too late to
question witnesses about them. The
hearings had ended.
SATISFIES TOP BANKERS
AS the bill stands it meets the ap-
proval of commercial bankers of the
country. 1t has also been reviewed
carefully by all of the men important
ly concerned with banking in the
Eisenhower Administration and has
their blessing.
One dissent might be mentioned.
Chairman William McChesney Martin
and James L. Robertson of the Fed
eral Reserve Board urged that banks
be required to publish complete and
informative financial reports. Their
suggestion was not accepted by the
Senate Banking and Currency Com
mittee, which agreed with a repre-
sentative of the American Bankers
Association who testified:
Earnings and dividends should be
considered a confidential matter be-
tween the authorities and the indi-
vidual bank, and it should be made
certain that the publication of such
reports is not authorized"
Now it appears that certain bank /!
stockholders are not satisfied with the
provisions in the bill which would
make cumulating voting for directors,
which is now mandatory and protects
minority interests. optional with the |
banks. Bank boards would be required |
to decide whether minority stock
holders should have representation.
FRB Governor Robertson argued in
favor of giving minority interests a
vote on the board, as at present he
said:
''It seems to me, if you do (repeal
cumulative voting) you
might as well take away the power
to vote with shares, and give it solely
to the directors. You make a club of
it "a bank instead of business cor
ooration."
INSIDERS SEEK PRIVILEGES
Perhaps the most brazen demand !
If the bankers was that bank officials
De granted special privileges such as {
options to purchase bank stocks. In
he absence of full financial disclosure
md continued minority representa-
ion such privileges would certainly 7
cad to abuses by insiders, stockholder
representatives have asserted. !
One banker did not hesitate to
astigate the proposed legislation. He
vas Maurice S. Brody, director of =
he Denver National Bank, second {
argest in Colorado. He testified: d
''The basic intent of this bill is to
oncentrate the financial control of
III HdlloiIdl DdHhS III CHe HdnQS OF
ew professional bankers"
And Morris A. Schapiro, of the New
,orR securities firm that bears his
anne, recently told Boston group:
"Under the act as it now stands
he stockholder has suffered a three q;
ray defeat. He could be called upon d.
or options while still in the dark $
nd minus his voting rights 81 8,
AS the bill now stands it would h,
lso make it possible for the banks to 81
ontinue usurious practices which are az
ooking small borrowers of millions 81
dollars annually. Patman has called Sc
lie section affecting usury the Ebe- -,
ezer Scrooge amendment. fo
1t is clear that this bill has had tt
sufficient examination through tes- -,
mony at public hearings, and has
zen railroaded Because of the tre- tt
endous banker pressures brought ,n,
'on Congress for its passage, it may IT.
accepted. Patman would like toI
e it thrown out and a new start
ade, but he doesn't think that pos tle fis
,le. ca
Debate in the House, when the bill da
reported from committee is sure
be extremely stormy.