Page images
PDF
EPUB

the fund for expenses, increase the salaries of officers and directors and continue themselves in office.

Since I called the attention of the public to this matter in a letter published a few months ago, this feature has been discontinued; but without legislation it can be issued to the secretary direct or reinserted in the application blank with as much propriety as before.

Another objectionable feature, is the number of years for which a director is elected. Instead of electing a majority of the board each year as a mutual benefit society should, some associations elect their directors for ten, nine, eight and seven years.

If the shares of stock mature in six and one-half years as they advertise, the present shareholder will hardly have an opportunity of voting for a director, even though a change in the board be desirable.

The Commissioner would also suggest that some measures be taken to control and restrict the business of national associations organized in other states, and who have established local boards in this.

Many other criticisms and objections might be made, but the above is sufficient to show that careful legislation is necessary to protect the public who are inclined to take advantage of any situation they imagine will better their condition, and more particularly those who are compelled to wait from six to ten years, before they can reap the full benefit of their investment.

From the fact that there has been no State supervision, whereby the public may know whether they comply with the law or not, it is fortunate that the majority of the associations in the State, are managed by honest, faithful, conscientious men.

In view of this, it seems to me that the law could be so amended, that it would meet the objections raised, and place all associations in a position where they can operate in accordance with law for the best interest of the public.

At the request of the delegates at the business men's convention, recently held at Grand Rapids, and at the suggestion of nearly every local and national building and loan association in the State, I ask that they be placed under State supervision, and their organization, scope of business and numbers, be so regulated by law, that they will become what the founders intended they shoud be, a blessing to humanity and an honor to the State.

OTHER INSTITUTIONS.

In addition to those already mentioned, there are several other so-called mutual benefit associations in the State, that should be responsible to some one, who has authority to license, control and investigate them.

While the law under which these associations assume to operate may be good, there is at present no way of knowing whether they conduct their business in accordance with law, and no one to whom they are accountable for any infringement or infraction of its provisions.

The old proverb, "what is everybody's business is nobody's business" aptly applies in this case.

Aside from those corporations that are supposed to be organized under some act of the Legislature, there are many other companies formed in this State, that, in my opinion, operate without a shadow of law.

26

COMMISSIONER OF THE BANKING DEPARTMENT.

To these I call your especial attention, and the attention of the Legislature.

The Legislature cannot by law make men honest, neither can it legislate wisdom into those who are the victims of sharpers, but the Legislature can refrain from enacting laws that protect the dishonest man in his dishonesty, and enables him to become rich from the "lapses" of the unfortunate.

There never was a time in the history of the State, when there was so many persons with financial schemes that permit their handling other people's money, or that enables them to "eat their bread by the sweat of some one else brow."

The highwayman of fifty years ago was but a child as compared with the confidence-man of today.

Then, he presented his pistol at his victim's head and demanded his money only, while the "Dick Turpin" of today without pistol or knife will politely relieve his victim of the money he has on hand, and coolly take his note for as much more, with interest at ten per cent, and the law that should protect the victim and not the confidence-man, compels its payment at maturity through the innocent third party.

The innocent holder of the note in many cases is in league with the sharper, and the two select the most influential person in the community, who, by the promise of official position, or large salary, is blind to the true "inwardness" of the scheme, and, unwittingly perhaps, becomes the "bunco stearer" that furnishes more victims for the slaughter.

I have thus tersely called your attention to these matters, because I am sensibly impressed with their importance, and the necessity of immediate action.

BANKING DEPARTMENT.

The State Banking Department, although occupying rooms too small for its proper accommodation, can now be said to be thoroughly established. Two years' experience has demonstrated the fact, that State supervision, not only inspires confidence between the different banks, but also between the banks and their depositors, as is evidenced by the large increase in deposits during the year.

While I have earnestly urged that building, loan and other mutual benefit associations be placed under State supervision, I trust they will not be under the control of the Banking Department, as we have neither room for their accommodation, nor time to devote to their proper care.

In closing this report, the Commissioner desires to express his appreciation of the promptness with which bank officers have responded to the calls for reports, and the courteous treatment he has received at their hands.

In this connection, I am pleased to be able to report that during the past two years there has not been a defalcation or breach of trust by any of the officers or clerks in the State banks of the State; and as far as I have been able to learn, this is also true of the National Banks. In these times of official corruption and dishonesty, this is a record, of which the State may well feel proud.

In conclusion the Commissioner greatfully acknowledges the faithful and efficient survice which has been rendered by those associated with him in conducting the affairs of this department.

THEODORE C. SHERWOOD.

[ocr errors][merged small][merged small][merged small][merged small][merged small]

MAY 17, JULY 18, OCTOBER 2, AND DECEMBER 19,

1890.

COMMISSIONER OF THE BANKING DEPARTMENT.

29

No. 89.

THE COMMERCIAL SAVINGS BANK, ADRIAN.

Organized May 10, 1888.

W. J. COCKER, President; S. HOWELL, Vice President; A. BENNETT, Secretary;
WM. B. THOMPSON, Cashier.

DIRECTORS-W. J. Cocker, Seymour Howell, J. G. Mason, C. R. Miller, Norman Geddes, A. Bennett,
A. M. Stephenson, Chas. Bowerfind, D. Metcalf.

[blocks in formation]
« PreviousContinue »