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TWENTY-SEVENTH CONGRESS. Sess. I. Ch. 12. 1S41.
District attor-ney, on suspen-sion or refusalto pay in specie,to take steps ne-cessary to en-force (lie forfeit-ure, and to com-pel such bankto wind up itsconcerns, underact of 3d July1840, ch. 40.
Banks prohib-ited from mak-ing new loanson their stockas security, &.c.
President anddirectors liablefor such loans,made or renew-ed with theirconsent.
What shall bedeemed to be aconsent.
Any loan tobank officers,exceed’g 10,000dollars, to becurailed at least25 per ct. annu-ally, until notover that sum.
No new loanto be madethem whichshall, includingunpaid balances,exceed $10,000.
President anddirectors liabletherefor.
banks shall, each for itself, from and after the passage of this act, re-sume and continue the payment of all its notes and specie liabilities inspecie, on demand; and each and every of said banks failing to resumespecie payments, as aforesaid, within ten days after the passage of thisact, or having resumed specie payments, again suspending or refusingto pay any of its notes or other specie liabilities in specie, when legallydemanded, or shall pay out or lend out, after the first day of Marchnext, the notes of any suspended bank, or any paper currency whateverwhich is not equivalent to gold and silver, shall, in the first case, beexcluded from all participation in the privileges and provisions of thisact; and, in the second case, shall, ipso facto, forfeit all benefit andprivilege granted by it; and it shall be the duty of the district attorneyof the United States for the District of Columbia , upon informationlodged with him of any such suspension or refusal to pay in specie byany of said banks, to take forthwith the necessary and proper legalsteps to enforce the forfeiture hereby provided for such refusal or sus-pension, and to compel every such delinquent bank to proceed to windup its concerns, under, and agreeably to, the provisions of the act ofCongress entitled “ An act to continue the corporate existence of cer-tain banks in the District of Columbia , for certain purposes,” approvedthe third day of July, in the year eighteen hundred and forty.
Sec. 2. And be it further enacted, That each and every of said banksshall be, and they are hereby, expressly prohibited from making anynew loan or loans whatever, upon a pledge of stock in said bank as se-curity for the repayment of said loan; and they are hereby required,upon all loans now existing upon any such pledge of stock, to requireand exact, before any renewal or extension of any such stock loan shallbe granted, other sufficient security for the same, in the form, and to theextent usual in said banks upon making ordinary loans. And the presi-dent and directors of each of said banks are hereby made individuallyliable to all persons concerned, for the whole amount of any loan orloans hereafter made or renewed contrary to the aforegoing provisions,by them, or any of them, or with their consent, from the funds of anyof said banks; and the cashier of each of said banks shall keep a regu-lar record of the attendance of the president and each director at everymeeting of the board of directors of the bank of which he is cashier;and every president and director who shall be present at any meeting atwhich any loan upon a pledge of stock, as aforesaid, shall be made orextended, shall be deemed to have consented to the same, unless heshall at that meeting enter his protest, in writing, against said loan onthe minutes of their proceedings.
Sec. 3. And be it further enacted, That in each and every of saidbanks, all loans now existing to any president, cashier, director, or otherofficer, either as principal or security, to a greater amount than tenthousand dollars, shall be regularly curtailed or reduced, at the rate ofat least twenty-five per cent, or one fourth of the whole amount, annu-ally, in a due proportion at each renewal at the expiration of ninetydays successively, until the sum of such loan shall, in no instance, ex-ceed the amount of ten thousand dollars aforesaid. And no new loanor loans shall hereafter, on any pretence whatever, be made to any presi-dent, cashier, director, or other officer, either as principal or security,to a greater amount in the whole including the unpaid balances offormer loans than ten thousand dollars; and the same penalties, liabili-ties, and presumptions shall, in every case of a loan made contrary tothe spirit, intent, and meaning of this section, attach to the presidentand directors of the bank by which said loan shall be made, as is pro-vided in the preceding section, in the case of loans upon a pledge ofthe stock of the bank making the same.
Sec. 4, And be it further enacted, That each and every of said banks