Examination by special agent protest. holder of any notes causes more than one note or package to be protested on the same day, he shall not receive pay for more than one protest. 106. (SEC. 5227.) On receiving notice that any national after notice of banking association has failed to redeem any of its circulating notes, as specified in the preceding section, the Comptroller of the Currency, with the concurrence of the Secretary of the Treasury, may appoint a special agent, of whose appointment immediate notice shall be given to such association, who shall immediately proceed to ascertain whether it has refused to pay its circulating notes in the lawful money of the United States, when demanded, and shall Forfeiture of report to the Comptroller the fact so ascertained. If from such protest, and the report so made, the Comptroller is satisfied that such association has refused to pay its circulating notes and is in default, he shall, within thirty days after he has received notice of such failure, declare the bonds deposited by such association forfeited to the United States, and they shall thereupon be so forfeited. bonds. Association not to do business protest. 107. (SEC. 5228.) After a default on the part of an assoafter notice of ciation to pay any of its circulating notes has been ascer tained by the Comptroller, and notice thereof has been given See act of Feb. by him to the association, it shall not be lawful for the assoing Rev. Stat., ciation suffering the same to pay out any of its notes, discount any notes or bills or otherwise prosecute the business 18, 1875, correct page 60. Notice to noteholders. of banking, except to receive and safely keep money belong. ing to it, and to deliver special deposits. 108. (SEC. 5229.) Immediately upon declaring the bonds of an association forfeited for non-payment of its notes, the Comptroller shall give notice, in such manner as the Secretary of the Treasury shall, by general rules or otherwise direct, to the holders of the circulating notes of such association, to present them for payment at the Treasury of the Redemption of notes at Treas- United States; and the same shall be paid as presented in lation of bonds. lawful money of the United States; whereupon the Comp troller, may in his discretion, cancel an amount of bonds pledged by such association equal at current market rates, not exceeding par, to the notes paid. ury, and cancel Sale of bonds at auction. 109. (SEC. 5230.) Whenever the Comptroller has become satisfied, by the protest or the waiver and admission specified in section fifty-two hundred and twenty-six, or by the report provided for in section fifty-two hundred and twentyseven, that any association has refused to pay its circulating notes, he may, instead of canceling its bonds, cause so much of them as may be necessary to redeem its outstanding notes to be sold at public auction in the city of New York, after The United upon assets of as giving thirty days' notice of such sale to the association. For any deficiency in the proceeds of all the bonds of an States to have a association, when thus sold, to re-imburse to the United paramount lien States the amount expended in paying the circulating notes sóciations. of the association, the United States shall have a paramount lien upon all its assets; and such deficiency shall be made good out of such assets in preference to any and all other claims whatsoever, except the necessary costs and expenses of administering the same. at private sale. 110. (SEC. 5231.) The Comptroller may, if he deems it Sale of bonds for the interest of the United States, sell at private sale any of the bonds of an association shown to have made default in paying its notes, and receive therefor either money or the circulating notes of the association. But no such bonds shall be sold by private sale for less than par, nor for less than the market value thereof at the time of sale; and no sales of any such bonds, either public or private, shall be complete until the transfer of the bonds shall have been made with the formalities prescribed by sections fifty-one hundred and sixty-two, fifty-one hundred and sixty-three, and fifty-one hundred and sixty four. Transfer of bonds sold. Treasurer. 111. (SEC. 5232.) The Secretary of the Treasury may,, Disposition to from time to time, make such regulations respecting the dis- redeemed by position to be made of circulating notes after presentation at the Treasury of the United States for payment, and respecting the perpetuation of the evidence of the payment thereof, as may seem to him proper. 112. (SEC. 5233.) All notes of national banking associations presented at the Treasury of the United States for payment shall, on being paid, be canceled. Cancellation of notes. See act of June 20, 1874, section 3, page 53. and duties of re V8. Gibson, 8 Wall., Bethel vs. Pah Wall., 19; in re etc., 1 Ben., 534. 113. (SEC. 5234.) On becoming satisfied, as specified in Appointment sections fifty-two hundred and twenty-six and fifty-two ceivers. hundred and twenty-seven, that any association has refused Kennedy to pay its circulating notes as therein mentioned, and is in 498; Bank of default, the Comptroller of the Currency may forth with quioque Bank, 14 Wall., 383; Bank appoint a receiver, and require of him such bond and secu- vs. Kennedy, 16 rity as he deems proper. Such receiver, under the direction Platt, receiver, of the Comptroller, shall take possession of the books, records, and assets of every description of such association, collect all debts, dues, and claims belonging to it, and, upon the order of a court of record of competent jurisdiction, may sell or compound all bad or doubtful debts, and, See section 1, on a like order, may sell all the real and personal property of such association, on such terms as the court shall direct; and may, if necessary to pay the debts of such association, enforce the individual liability of the stockholders. Such act June 30, 1876, page 63. Notice Comptroller creditors. to Dividends by Comptroller to V8. Bank of Bethel Bank, 14 Wall., 383. receiver shall pay over all money so made to the Treasurer of the United States, subject to the order of the Comptroller, and also make report to the Comptroller of all his acts and proceedings. by 114. (SEC. 5235.) The Comptroller shall, upon appointing a receiver, cause notice to be given, by advertisement in such newspapers as he may direct, for three consecutive months, calling on all persons who may have claims against such association to present the same, and to make legal proof thereof. 115. (SEC. 5236.) From time to time, after full provision creditors. has been first made for refunding to the United States any vs. Pahquioque deficiency in redeeming the notes of such association, the Comptroller shall make a ratable dividend of the money so paid over to him by such receiver on all such claims as may have been proved to bis satisfaction or adjudicated in a court of competent jurisdiction, and, as the proceeds of the assets of such association are paid over to him, shall make further dividends on all claims previously proved or adjudicated; and the remainder of the proceeds, if any, shall be paid over to the shareholders of such association, or their legal representatives, in proportion to the stock by them respectively held. page 49. Injunction upon 116. (SEC. 5237.) Whenever an association against which receivership. See sec. 736, proceedings have been instituted, on account of any alleged refusal to redeem its circulating notes as aforesaid, denies having failed to do so, it may, at any time within ten days after it has been notified of the appointment of an agent, as provided in section fifty-two hundred and twenty-seven, apply to the nearest circuit, or district, or territorial court of the United States to enjoin further proceedings in the premises; and such court, after citing the Comptroller of the Currency to show cause why further proceedings should not be enjoined, and after the decision of the court or finding of a jury that such association has not refused to redeem its circulating notes, when legally presented, in the lawful money of the United States, shall make an order enjoining the Comptroller, and any receiver acting under his direction, from all further proceedings on account of such alleged refusal. Fees and ex 117. (SEC. 5238.) All fees for protesting the notes issued penses of protest and receivership. by any national banking association shall be paid by the person procuring the protest to be made, and such association shall be liable therefor; but no part of the bonds deposited by such association shall be applied to the payment of such fees. All expenses of any preliminary or other examinations into the condition of any association shall be paid by such association. All expenses of any receivership shall be paid out of the assets of such association before distribution of the proceeds thereof. determined. 118. (SEC. 5239.) If the directors of any national bank-, Penalty for vio. lation of provising association shall knowingly violate, or knowingly per. ions of this Title. mit any of the officers, agents, or servants of the association to violate any of the provisions of this Title, all the rights, privileges, and franchises of the association shall be thereby forfeited. Such violation shall, however, be deter- Violation, how mined and adjudged by a proper circuit, district, or Territorial court of the United States, in a suit brought for that purpose by the Comptroller of the Currency, in his own name, before the association shall be declared dissolved. And in cases of such violation, every director who partici-Liability of dipated in or assented to the same shall be held liable in his tion. personal and individual capacity for all damages which the Sections 5240, association, its shareholders, or any other person, shall have 5241, pages 32 and sustained in consequence of such violation. 33. viola signments, etc., solvency, void. 119. (SEC. 5242.)* All transfers of the notes, bonds, bills Transfers, asof exchange, or other evidences of debt owing to any na- after an act of in. tional banking association, or of deposits to its credit; all assignments of mortgages, sureties on real estate, or of judgments or decrees in its favor; all deposits of money, bullion, or other valuable thing for its use, or for the use of any of its shareholders or creditors; and all payments of money to either, made after the commission of an act of insolvency, or in contemplation thereof, made with a view to prevent the application of its assets in the manner prescribed by this chapter, or with a view to the preference of one creditor to another, except in payment of its circulating notes, shall be utterly null and void. CHAPTER SIX. TAX ON UNAUTHORIZED CIRCULATION. bank converted into national as sociation. 120. (SEC. 3410.) The capital of any State bank or bank- Capital of State ing association which has ceased or shall cease to exist, or which has been or shall be converted into a national bank, shall be assumed to be the capital as it existed immediately before such bank ceased to exist or was converted as aforesaid. 121. (SEC. 3411.) Whenever the outstanding circulation Circulation, when exempted of any bank, association, corporation, company, or person is from tax. reduced to an amount not exceeding five per centum of the chartered or declared capital existing at the time the same *For part of section 5242 see page 48, under head of Suits and Jurisdiction. 12, 1882, sections See act of July was issued, said circulation shall be free from taxation; and 6 and 8, pages 70 whenever any bank which has ceased to issue notes for cir and 71. Tax on notes of persons or State circulation. culation, deposits in the Treasury of the United States, in lawful money, the amount of its outstanding circulation, to be redeemed at par, under such regulations as the Secretary of the Treasury shall prescribe, it shall be exempt from any tax upon such circulation. 122. (SEC. 3412.) Every national banking association, banks, used for State bank, or State banking association, shall pay a tax of See act of Feb. ten per centum on the amount of notes of any person, or of and 20, page 59. any State bank or State banking association, used for cir culation and paid out by them. 8, 1875, secs. 19 Tax on notes of towns, cities, etc., 123. (SEC. 3413.) Every national banking association, used for circula- State bank, or banker, or association, shall pay a tax of teu See act of Feb. per centum on the amount of notes of any town, city, or tion. 8, 1875, secs. 19 and 20, page 59. municipal corporation, paid out by them. Monthly re turns of notes of State banks, etc., page 59. 124. (SEC. 3414.) A true and complete return of the persons, cities, monthly amount of circulation, of deposits, and of capital, as aforesaid, and of the monthly amount of notes of persons, 8, 1875, sec. 21, town, city, or municipal corporation, State banks, or State banking associations paid out as aforesaid for the previous six months, shall be made and rendered in duplicate on the first day of December and the first day of June, by each of such banks, associations, corporations, companies, or persons, with a declaration annexed thereto, under the oath of such person, or of the president or cashier of such bank, association, corporation, or company, in such form and manner as may be prescribed by the Commissioner of Internal Revenue, that the same contains a true and faithful statement of the amounts subject to tax, as aforesaid; and one copy shall be transmitted to the collector of the district in which any such bank, association, corporation, or company is situated, or in which such person has his place of business, and one copy to the Commissioner of Internal Revenue. In default of returns, Commis mate. 125. (SEC. 3415.) In default of the returns provided in sioner to esti- the preceding section, the amount of circulation, deposit, capital, and notes of persons, town, city, and municipal corporations, State banks, and State banking associations paid out, as aforesaid, shall be estimated by the Commissioner of Internal Revenue, upon the best information he can obtain. And for any refusal or neglect to make return and payment, any such bank, association, corporation, company, or person so in default shall pay a penalty of two hundred dollars, besides the additional penalty and forfeitures provided in other cases. |