This same
client had three open accounts, one as administrator, then a general
account, and a special account. The whole thing was fictitious; the
schemers sought to conceal irregularities, and had thus imposed on the
examiners and on the Directors themselves.
The certificates issued by the clearing house, when credit had entirely
disappeared, rendered a great service and sustained a great number of
houses in equilibrium, which without this assistance must have
succumbed. They were granted especially to the banks belonging to the
Association, in order to make their daily settlements.
During the crisis of 1873 the same means had been resorted to, but too
late; the panic was already at its height and the commotion general, so
that nothing could re-establish confidence. This was not the case in
1884: the rapidity and decision with which the Associated Banks took
steps gradually re-established confidence throughout the country. The
maximum of issue did not exceed $24,900,000, of which $7,000,000 were
for the National Metropolitan Bank; from the 10th of June balances at
the clearing house were paid in legal money. Commercial paper, which for
the most part was the collateral for these certificates, had already
been redeemed.
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