Evening star., 1960-04-08

sCSOCA bAAC y yO4A4SS JILL dPP1 ONCO
ure last month.
d Savings and Loan League anc
simply has been left holding
the bag.
I'VE also feel that those who
opposed this bill completely
misrepresented its intent at the
hearing before the Governor
So far as our insured aSSocia-
tions are concerned, we know
that we are adequately super
vised by the Federal Govern
ment, but we hope the invest
ing public does not suffer Seri-
Gus losses in a few unregulated
associations"
Mr.. Gottschalk expressed
Skepticism over the Governors
plans. IF he wouldn't approve
mild, halfway measure such
as the Tydings bill we don't
expect him to be willing to sup
port any kind of really effective
legislation"
Refuge for Crooks
officials of the United States
Savings and Loan League here,
also expressed disappointment
last night on the Tawes' veto.
At the Governors hearing,
they argued that lack of Mary
land regulations had become a
serious interstate problem with
known shysters setting up So
called savings and loans asso-
Citations in the State to solicit
savings by mail with fraudu-
lent promises and the lure of
abnormally high dividend rates.
Officers of several Maryland
associations of this type have
been charged with mail fraud
in recent years. The State of
Ohio issued a warning only this
week to an organization listing
offices in nearby Riverdale, Md.
The bill would have required
that officers and directors of
a savings and loan association
be residents of the State for at
least two years. 1t also called
for publication of annual f.
nancial statements, limited as
sociations to mutual companies
in which all investors would
have an equal voice, and other
requirements.
Rejects Argument
In rejecting the argument
that any semblance of regula-
ton is better than no law at
all, Gov. Tydings said the Ty-
dings bill gave the State De-
partment of Assessment and
Taxation the responsibility of
administering regulations but
provided no clear-cut direc-
tionS, guides, standards or rules
to follow.
After issuance of a certificate
of incorporation, the positive
jurisdiction and regulatory role
of the department is Tex
tremely vague and doubtful
and, for practical purposes, it's
effectiveness seems to come to
a dead end" he said.
Within the framework of
the present administrative
structure, the Illustration that
would be facing the department
would be exceeded only by the
Illustration facing the industry
which the bill seeks to control. "
Control Repellent
Charging that the bill pro-
vided for enforcement only
through criminal processes with
extreme penalties, the Cover
nor said this type of control
was repellent to him. Refer
ring to the provision that Off
GERS and directors of an asso-
citation would have to be resi-
dents of the State for two
years, he said he had been ad-
vised this could easily be cir
cumvented by incorporating
outside of the State and estab-
fishing branch Offices in the
State.
Gov. Tawes pointed out that
the bill did not cover one of
the most flagrant type of Of
fenseS committed by "fy-by-
night" firms-the use of false
or misleading advertising"
He referred to advertisements
that deposits in the firms were
insured, when the insurance ac-
tually carried was either mad
equate or supplied by foreign
firms unaccountable to United
Go foe lo ~, 49,