Behind the Banker’s Bureau.

New Zealand Graphic, Volume XLIV, Issue 19, 11 May 1910, Page 44

Behind the Banker’s Bureau.

Amusing inside information about American banking methods — How they! affect social life—Not quite the same in New Zealand — Yet.

VERY morning, says a special reporter of the “ New York •6 k Herald.'’ a lot of persons get out of bed wondering how they can heat a hank, and every morning the conscientious and careful banker wonders, as he munches his breakfast roll, what novel job of rascality will be brought to his knowledge before three p.m. It is as true now as it was twentyfive years ago that eternal vigilance is the price of safety in the management ©f all institutions of the banking character. ENEMIES OF BANKS HAVE NOT BECOME FEWER. They merely have been redistributed «as to class. The old order change! h, giving place to the new, and crime renews itself in different ways. Undoubtedly the percentage of victimised monetary institutions is much smaller than formerly, but this is due to the great* r efficiency of the precautions of bankers rather than to any lessening of the numbers of evil minded persons.

At a meeting of alienists in New York city the other day a celebrated American expert’ told of an interview he had with Cesare iaimbroso last summer in Turin Bud repeated a ifmark made by the late Italian criminologist as to factors making for insanity in tne United States. “You may expect,” said Lom'brosi, •that with the rapid multiplication of

banks in America there will be an aggravation of certain obscure mental disoiders. I'he spectacle of large sums of gold, silver and paper currency lying ex- ] wised to view in a bank and apparently 1 dunging to no one in particular develops a latent insanity regarding possession. Employer,s should be careful not to permit any employee not of obviously well-balanced faculties to have the duty of regularly depositing money for them in a bank, for the exhibits at the teller’s window may um-over an unsuspected, mania.” So far as open, notorious, flagitious criminality confronts them, bankers have carried precautions in the twentieth century to a point where the grossest forms of felony will have less scope each year, (k-cas'ion.illv the “hold-up man’’ operates successfully in an up-country bank, but the percentage of bank burglary is falling steadily and fast. Embezzling bank officials and employees form the second smallest percentage. Bui their numlxu also is diminishing under the pressure of heavy sentences, though, according to the president of a big Manhattan bank, every time the newspapers record the arrest of a discovered bank embezzler half a dozen undiscovered scoundrels mutter beneath their breath, “Wonder if I’ll be the next.’’

Thanks to the energy with which the Bankers* Association follows ui>

THE FORGER OF DRAFTS, note-, checks and certifications, the criminal of this group finds that his trade suffers severely from the high cost of living. In the broader field of offending against the general banking law considerable activity continues; but substantial terms of imprisonment for a few notable offenders and indictments for others bid fair to improv*' the position materially in such particular- as excessive loans, overcertification and the unwarranted extension of credit facilities. Of late, however, with the multiplication of banks and the competition for new accounts, conservative bankers are finding that it pays them to keep A MORE WATCHFUL EYE upon the depositor than once was thought necessary or even expedient. In several instances, banks have organised “information, departments’’ through which in a confidential way they are able to keep track of a depositor as to whose social or business habits any ground for criticism might be alleged or suspected. Impertinence, do you say? Not exactly. Meddling in matters that do not concern them? Not exclusively. Banks in the United States, like those in France, Germany and England, are becoming something more than mercantile conveniences. They have a definite part in the social system; and it is altogether distinct from that of the ordinary trade establishment, to which one person's

patronage is as welcome as another’s. They have come to be considered more or less as sponsors for their depositors; and the latter are more and more inclined to name their banks first in their credentials of social eligibility. EVERYBODY KNOWS HOW IT WORKS. In New* York are several banks--we are iH>t dealing, of course, with savings banks, but with institutions carrying cheque accounts— where women constitute a majority of the patrons. They are conducted with as much circumspection as to choice of depositors as could be exercised by a. club of the highest tone in the selection of members.

Espionage in these circumstances means infinite tact and judgment. A similar system is applied elsewhere much oftener than is suspected by the average depositor, when it is found that a customer keeps a personal account in more than one kink, or a number of accounts of n fiduciary nature in as many institutions—possibly in districts widely separated—and has a habit of interchequing between them and into a local person il account. Nor is the espionage limited to depositors in the categories indicated. At a celebrated hank the cashier makes it a point, so far as is practicable, to KNOW THE ANTECEDENTS. SOCIAL RELATIONSHIPS AND PRIA ATE BUSINESS OF ALL 11LS DEPOSITORS. It seems a strong statement, but without the least annoyance to those with nothing to hide he contrives to get hold of a mass of useful information regarding persons who are earmaiked by the malady Lombroso defined to the American alienist. Here is an illustration. It involves a New Jersey man. One morning a New York newspaper, describing a social function held right away in New Jersey, mentioned among other incidents of interest that the guests danced an old-fashioned minuet on a dragon carpet, which, according to the host, had been in bis family for more than half a century, having been purchased by an

ancestor from an Englishman who got it from a Turk during the Crimean War.

That afternoon the cashier was talking at the bank with the bead of a New York carpet house, and the conversation turned to carpets. “Old carpets seem to be as much of a curiosity as old paint’ngs,** he said. “I saw in a Jersey newspaper as I rod© in this morning that one of our depositors had been entertaining his friends with a dance on a dragon carpet dating buck to the Crimea.” “How's that? I sent a dragon carpet yesterday on approval to a Jerseyman. I forget the name; but, come to think of it, I believe he gave your bank as his reference.” “Funny,” mused the banker, reaching for the cashiers telephone; the carpet man called his office, and was informed that the dragon cm pet had been “re* turned l ocalise too large for the room/’ Kime of proposed purchaser ? Same as the depositor’s. Wil liin forty-eight hours the cashier had learned that the gown worn by the depositor’s wife at the function—* it bad been described in the nowspaperq as “a beautiful confection, bought last month in Paris”—had been sent on approval by a Thirty-fourth-street dr< maker and returned the day after the dance as “not quite what m/ husband thinks I should wear—not recherche enough.” The lady had told. 1 be dressmak'-r that her husband his account with the So-and-So bank.” But it was the last time either husband or wife had the privilege of this valuable reference. The account was closed} out after the circumstances leading t4|

the step had been detailed to the depositor, and had been explained by him in One of those curious sophistries that explain nothing but the folly of the sophist COMPANIONSHIPS OF THE “GIDDY AND GAUDY ” SORT are rarely a recommendation on general principles in the case of a bank depositor. The cashier referred to numbered among his patrons a well known man about town, a “first nighter,” ath-

lete, sportsman. On an evening train for .Washington lie. met the depositor, who was chatting with a beautiful woman of 25—“ my favourite niece,” remarked the cosmopolite when the introduction took place. Some weeks later at a Plaza musical tea the cashier’s wife met the depositor’s wife—their first interview. “Oh, my husband was so much charmed by your nieee,” chortled the former,; "so much taken witli her beauty and conversational powers. They met. as you know, when your husband and she were on their way to Washington to join you for Christmas.”

As a result of the impressions received by the cashier's wife from the chai: gi"g countenance of the depositor’s wife, a good actress and a discreet woman, the

hank's information department covered th.e depositor for a week or two. and then it was decided that the cheques to the niece were becoming too frequent, and that it would be wise to close the account. 'the depositor raged, and declared he would not submit to humiliation, but the cashier was blandly firm, and the niece gets her cheques to-day through other bank connections, STOPPING A CHEQUE.

“You perceive the difficulty,” observed the cashier naively, when recalling the episode. “Cheques often are used in domestic litigation to show embarrassing Outside relationships, and it would be deucedly unpleasant for our bank to be mixed up in a thing of that sort.” Another suggestive case. One Monday morning the cashier found in his mail a letter from a young millionaire directing that payment be stopped on a cheque for a large amount dated the previous Friday. A few minutes afterward the depositor telephoned. He said that on Friday night he had been playing at a gambling house “protected” by the police, had taken a “few drinks,” had become confused over his losses, and to the best of his recollection had drawn a cheque to pay them, but had drawn intentionally in excess of the loss in order to get cash for immediate use.

“I want the cheque stopped until I can figure out how I stand," he added. “And, anyhow, my lawyer tells me that the 'debt is not collectible, and the proper thing to do is to return the cash adyonced to me.”

“Very well. Mr. Jones.” responded the cashier’ “The cheque will not be paid by ms. But if you will oblige me by sending down your l>ank Isvok by npeei:d ines-en ger at our expense we will be ready to close out your account in about an hour.”

ANOTHER KIND OF SWINDLE. A case of a sort different from any outlined. On the first business day of 1910 a plausible person proposed to O|>en an account with the bank of the cashier in question, and offered a certified cheque for 2000dol. as a beginner. The official explained that it w-as a rule of the bank to consult personally with the references of the applicant. “Merely a matter of routine when the

application Is so obviously eligible as yours,” he murmured, as he filled in the blank with the data communicated by his caller; “but we must go through it. if only for the sake of form.” Nothing i'ould have been more satisfying than the superficial outcome of the investigation into the man’s references; but the cashier, an old hand at ferreting out banking humbugs, could not throw off the feeling that there was something in the background worth knowing. He turned the information department loose on the trail, and ere the next moon the 'report was before him. This showed that about six month.- back, and while the new depositor was carrying a cheque account in a Brooklyn bank, he was carrying another in a Boston institution. Everything went with perfect smoothness

in Brooklyn. The depositor had hull up an excellent reputation there.

In Boston a situation like the following ileveloped. The snviinl had been opened with a certified cheque for s2oo'l. In the course of a few weeks all Imt $l5 had been withdrawn, and the depositor left bis book to he balanced. Next day he wrote to the Boston bankers that one of the cheques in the bunch bad not Iteeu made out by iiiin a cheque for $250 drawn to bearer, indorsed by “Ellen Smith,” beneath which endorsement was the name of the drawer and the word “Correct.” lie asserted that in butii eases his na mu* hail been forged bv his stenographer, who had disappeared. The Boston bank stood the ‘loss” but closed the account. Vs the Xew York e i>hier ha I n>tked a eh ver-looking noting woman making deposits for his new depositor he invited the teller of the Boston bank to inspect her. “balen >milli or her twin!” ejaeu luted tin* Bostonian a! first glance. The rest may easily be imagined.