A few hours after the bank was closed and announcement had been made of the appointment of a receiver, the Deputy Comptroller received a telegram from a United States senator from that section of the country recommending a local man for appointment as receiver. This man was known to have been a bosom friend of the bank officer who was principally responsible for the wrecking of the bank, and was one of his political associates.
The senator was advised by wire that a receiver had been appointed before the receipt of his recommendation.
The following day this senator and a representative in Congress, from the city of the bank's location, called upon the Deputy Comptroller and renewed the recommendation for appointment as receiver of the man the senator had recommended by wire the day before. They urged in the strongest terms the superior qualifications and business experience of their candidate, and his especial fitness for the position of receiver because of his knowledge of local conditions and his acquaintance with the people with whom the receiver would have to deal.
The Deputy Comptroller stated to the senator and the representative in reply, that conceding all they said of their candidate's fitness for the position, a better or more experienced man than the one he had appointed receiver he did not believe could be found, and that he intended the appointment to be permanent, and was not disposed to make any change.
"Very well, then," said the senator, "we will go higher."
"Very well, gentlemen," said the Deputy, "that is your privilege."
The distinguished senator had not been accustomed to having his recommendations disregarded by one so far down, in his estimation, in the official scale of importance as a Deputy Comptroller of the Currency, so he declared it to be his purpose to appeal to the Secretary of the Treasury.
Later, on the same day, the Secretary of the Treasury sent for the Deputy Comptroller in regard to the matter, and the Deputy explained the situation in detail to him, and the qualifications and special fitness for this particular trust, of the man whom he had appointed receiver.
The Secretary replied, saying, "Well, you know that Senator (calling him by name) is a pretty big man. He has done a great deal for the administration and we have to rely upon him to do a good deal more, so that it may be necessary to meet his wishes in this matter."
The Deputy Comptroller was not pleased with the apparent altitude of the Secretary as indicated by his remarks, as it gave him the impression that he did not intend to support him in this appointment as against the senator; but later he was very much gratified to learn that his impression was wrong.
When the Deputy returned to his room he wired the receiver to advise him promptly by mail whether there were any good reasons why the party recommended by the senator should not be appointed receiver of the bank.
The next morning's mail brought a letter from the receiver in which he stated that it would be a great mistake to appoint this man receiver, and that his appointment would subject the Comptroller to severe public criticism, as he was generally known to have been an intimate social and political friend of the man who was responsible for wrecking the bank, who was one of his bondsmen as a city official, and was himself a debtor of the bank for a considerable sum.
The letter also contained copies of several very strong protests against his appointment, or the appointment of any other resident of the city in which the bank was located. Upon receipt of this communication and its inclosures, the Deputy Comptroller immediately wrote a letter to the Secretary of the Treasury in part as follows:
I enclose herewith copies of several communications received this morning protesting against the appointment of Mr. ------------ or any other resident of ----- as Receiver of the - National Bank.
Mr. -- ------, whom I appointed Receiver of the bank, is thoroughly competent in every respect. He has been connected with this Bureau in receivership work for ten or twelve years. I selected him because of his special qualifications for the position and his long experience in this particular line of service, his knowledge of the banking laws, decisions of the courts in insolvent bank cases, and his familiarity with the methods of this Bureau in the administration of insolvent banks, insuring a speedy, judicious, economical and impartial liquidation of the affairs of this trust.
Politics played a large part in the wrecking of this institution. There is no politics in Mr. ---------- 's appointment. There should be none in any appointment of this kind.
To appoint Mr. --------- as receiver of this bank would be against the established policy of this Bureau and contrary to all precedent within my recollection, and would undoubtedly subject the Comptroller to severe criticism.
The law, as you are well aware, Mr. Secretary, vests in the Comptroller of the Currency the power to appoint receivers of failed banks, and holds him accountable for the proper administration of the trusts. The responsibility for the appointment should carry with it the untrammelled right of selection. If the President directs, or if you,
Mr. Secretary, direct the appointment of Mr.----------------as receiver of this bank, I shall make the appointment, but with very great reluctance and against my judgment as to what is for the best interests of all concerned and the service in general.
The receiver of this bank should be an entirely independent and disinterested party who can be depended upon to impartially administer the affairs of the trust and to aid to the fullest extent in bringing to justice all who were concerned in the wrecking of this institution.
On the same day that the Deputy Comptroller addressed this communication to the Secretary he received a letter from him in reply in part as follows: