Evening star., 1960-08-12

; and Loan League.
e Maryland Legislature were al
ing Country Club near Wheaton
dence that the Governors COM
mission would come up with
sound legislation although a
number of League members ex-
pressed skepticism on this point
privately at the dinner.
Some league leaders previ-
ously had predicted the COM
mission would produce a weak
bill and the two Maryland
leagues and their friends in the
Legislature would have the real
job of drafting effective legis-
lation. Mr.. DeFord expressed
regret that Mr.. Case was un-
able to attend the dinner be-
cause of an out-of town COM
mitment.
! Tawes Views Cited
The need for savings and
loan legislation in Maryland
was recognized clearly by Gov
Tawes, although he vetoed the
ITydingS Bill, Mr.. DeFord de-
clared.
Gov. TaweS, in his veto
message stated that he had
received many requests from
Governors, bank commissioners
and others of high authority in
many States, urging that
Maryland enact proper legis-
lation to protect the funds of
their citizens, who have been
lured by the advertisement of
high dividend rates, expensive
glve-aways and 'so-called COM
mercial insurance up to $40. 900
for each account, to place their
funds in comparatively newly
organized Maryland State
chartered associations. some of
which are now under indict-
ment by a Federal grand jury"
he said.
1T may be Of interest to you
to know that for the past three
years the number Of applica-
tions for building or saving and
loan associations chartered in
our State has increased from
l8 in 1857 to 38 in 1858, to Al
in 1859, and as of July II OF
this year IS applications have
been filed with the State Tax
Commission. Many of these
applications are from without
our State.
This situation is peculiar to
the State of Maryland and
does not apply to the other 49
States of the Union. They
have regulation and super
visory laws" he declared.
Information Offered
The Maryland and national
leagues representing the vast
majority of the industry in the
State stand ready to supply
any information needed for the
drafting of proper legislation,
Mr.. DeFord said. a ....
Most of the legislators at
tending last nights affair came
from Central Maryland, in and
around Baltimore and the
Washington suburbs. Not many
were from the Eastern Shore
or Western Maryland.
This was expected in as
much as the so-called ''phony"
associations are springing up
mostly in the Baltimore and
Washington areas.
Relatively few in number yet
increasing almost every month,
they follow a recognized pat
tern. They seem, to spring from
nowhere, rent an excellent loca-
ton, install an impressive Office
with modern equipment, offer 5
or 81 per cent dividends, which
a soundly operated association
down the street cannot afford
to pay and still charge 60
ing rates for home loans. They
also offer a long list of give
away prizes for new accounts
and send out reams of elaborate
brochures claiming to be old
established institutions.
One Johnny-come-lately ad-
vertises in its circulars that it
has served its community So
years although so far as can
be ascertained 1t came into be-
ing less, than nine months ago.
These circulars and attractive
offers are mailed out en- masse
to the namelesS occupants of
apartments and houses.
Uncle Sam Helps
Uncle Sam is a willing helper
only up to a certain point. Laws
against using the mails to de-
fraud already have enmeshed
several of these so-called asso-
Citations in the courts.
What worries established saw
ingS and loan associations of
both Baltimore and Washing
ton areas is that fraudulent
operations by a few phonies
could do serious harm to their
fast-growing industry. Several
hundred executives of the
Maryland leagues member as
sociations attended last nights
event. Washington associations
also were we'll represented.
! Mr.. DeFord who heads the
Maryland league, is president
of the Union Federal Savings
and Loan Association of Balti-
more. General chairman for the
dinner was C. Edwin Kline
president of the Citizens Build
ing and Loan Association oi
Montgomery County, which has