CANADIAN BANK SMASH.

Dominion, Volume 5, Issue 1415, 16 April 1912, Page 7

CANADIAN BANK SMASH.

EX-PRESIDENT ARRESTED. By Teller)'pa—Press Association—CoDrricW Ottawa, April U. Dr. Beattie Nesbitt, ex-president of the Farmers' Bank of Canada, which failed in 1910, has been arrested in Chicago, charged with falsely representing tho bank's position. The investigation has disclosed some alleged 'irregularities. CANADA'S UNSTABLE BANKS. Tho failure of tho Farmers' Bank in 1910 was one of the most complete in the history of Canadian ' banking. According to tho curator, thero is a nominal deficiency in assets of 136,000 dollars (JK87,200). Over 500,000 dollars was advanced to the Kecley Mine in Cobalt, which (says "Tho Times" correspondent) may or may not turn out to be a successful venture, The bank's capital was 581,500 dollars, but even when the double liability is applied not more than 400,000 dollars is likely to be realised from that sourco. This means that thoro must be a loss to depositors as well as to stockholders. Persistent demands were made for a thorough investigation by the Federal or Provincial Government, and the revelations also greatly strengthened the movement for Government inspection of banking institutions. Every sound canon of banking seemed to have been violated in the conduct of the Farmers' Bank, and there was a strong feeling that the chartor never should have been granted. It is doubtful, however, whether under the law the Firiance Minister could have refused the application. In ten years seven Canadian banks have failed, while twelve have amalgamated with other banks, leaving npw only twenty-six in existence. The facts led to a very general feeling that tho conditions muter which banks are created and operated should bo tnorouehlv revised, and in January of this venr tho Government decided to appoint a Royal Commission to investigate tho failure of the Farmers' Bank. The general manager of the bank, William Travers, was arrested, and confessed in January, 1911. to having defrauded the bank of JESOOO, and was sentenced to a term of imprisonment. Dr William Bcnttie Nesbitt, according to the Canadian "Who's Who," was born in Ontario in 1860, and took his degree of M.D. at Toronto University in 1887. Ho practised his profession in Toronto for several years, but later became connected with several corporations and manufacturing concerns. He satin the Provincial Legislature for Nortli Ontauo for several years.