CO129-555-6 Banking crisis 24-9-1935 - 18-10-1935 — Page 64

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NOTE ON AMERICAN LEGISLATION.

The Federal Banking Act of 1933, Section 5 (c)

provides as follows:-

"In connection with examinations of State

member banks, examiners selected or approved by the

Federal Reserve Board shall make such examinations of the

affairs of all affiliates of such banks as shall be

necessary to disclose fully the relations between such

banks and their affiliates and the effect of such

relations upon the affairs of such banks. The expense

of examination of affiliates of any State member bank,

may in the discretion of the Federal Reserve Board, be

assessed against such bank and, when so assessed, shall

be paid by such bank. In the event of the refusal to

give any information requested in the course of the

examination of any such affiliate, or in the event of the

refusal to permit such examination, or in the event of the

refusal to pay any expense so assessed, the Federal

Reserve Board may, in its discretion, require any or all

State member banks affiliated with such affiliate to

surrender their stock in the Federal Reserve Bank and to

forfeit all rights and privileges of membership in the

Federal Reserve System, as provided in this section."

Section 28 of the same Act provides:-

Revised

The first paragraph of Sec. 5240 of the

Statutes as amended (U.S.C., Title 12, Sec. 481), 18

amended by inserting before the period at the end thereof

a colon and the following proviso: "Provided, that in

making the examination of any National bank the examiner

shall include such an examination of the affairs of all

its