which our director, Mr. H. B. May, or else his
brother, who was our Solicitor, brought us. I
call these documents "legal" merely because
they professed to arise from law transactions, and
not on account of their being in any way more
lawful tender or more "safe" to discount, than
any other kind of the worthless paper offered to,
and discounted by, our bank. The origin of these
bills was generally complicated, and always
curious. For instance, the friends of some clergyman
wished to purchase an advowson for him, or,
more truthfully speaking, some clergyman wished
to purchase an advowson for himself, in the name
of his friends. Let us say that the sum required
was three thousand pounds, and of this the
intending purchaser was minus five hundred
pounds. He would go to his solicitor, and,
through some complicated method of giving that
individual a lien upon the advowson, as well as
of insuring his life and assigning the policy to
the lawyer, get the latter to discount his note
of hand for the five hundred pounds, which note
of hand was to be renewed again and again
on payment of a certain commission. For
this discount the solicitor generally charged his
client about ten to twelve per cent, and then
re-discounted the document at the bank for five
or six per cent, thus making a clear profit of
five or six per cent, and having all the time the
use of his money. If the client paid the
notes of hand at maturity, well; if he did not,
the bank had to ask payment of the solicitor,
who either compromised the matter, or obtained
time, or otherwise had matters "made pleasant"
for him. The bank could hardly sue its own
legal adviser, and therefore, as is usual under
such circumstances, the unfortunate shareholders
were the sufferers.

I have said that so long as the commercial
wind was fair, our director, Mr. Francatello,
carried on his little game of discounting at ten
or twelve per cent, and re-discounting at five or
six, with both pleasure and profit to himself.
Nor did he hide these good things from others.
He introduced to the bank a host of friends, all
so called "mercantile" men, who opened
accounts with us, and "did" largely in the
discount way. These gentlemen were chiefly
foreigners, mostly descendants of the ancient
Hellenic race. The bills they brought us were
pretty uniform in character. The house of
Bravetti and Co., of Odessa, would draw for seven
hundred and four pounds ten shillings and eight
pence, at three months after date, upon
Bravetti Brothers, of London, in favour of
Ramonda and Company, also of London. Of course
the bill would be duly accepted, and would
then be brought to us for discount. If matters
went right—if no storm arose—the bill would
be duly provided for, at maturity, by the London
house drawing upon the Odessa firm, and getting
the draft discounted. Had matters been sifted,
it would probably have been found that Bravetti
and Co., and Bravetti Brothers, were one and the
same people, and that if the one house failed the
other was pretty safe to follow suit. If we had
merely discounted a few such bills—here a few
hundred pounds and there a thousand or two—
it would not have been so serious a matter; |
but when our bill case began to fill with similar
documents, and still more when, in order to
keep in funds, the bank had to endorse and
re-discount nearly all this paper, matters
commenced to look alarming, and the directors began
to feel that the foundation of the house was
built on sand. The military, West-end, legal,
and "sundry," bills might amount to some
hundreds of pounds—a couple of thousands
would have nearly paid them all—but the
"commercial" paper which had been brought us
by Mr. Francatello and his friends was a very
large item indeed, insomuch that nearly the
whole paid-up capital of the bank was seriously
compromised.

It may be asked what our directors were
about that they allowed the tide to rise so high
before becoming aware of the danger they were
in? The answer to this is the old tale, often
told, and yet—it is to be feared—often to be
told again. Of our eight directors four took
little or no practical interest in the bank. Mr.
Dant had joined the bank for the sole purpose of
obtaining the secretaryship for me, his nephew.
Mr. Dant's two friends, General Fance and Mr.
Westman, had joined the direction to please Mr.
Dant, and thought that, by showing themselves
from time to time in the board-room, they
would perform all the duty required of them.
These gentlemen put entire trust in the manager,
who, in his turn, was almost entirely controlled
by the directors interested in getting bills
discounted. Mr. Everett, another director, lived far
from London, and never came near the bank
oftener than once in six, eight, or ten weeks,
when he had not time to look minutely into
everything that had been done in his absence. As a
general rule, shortly after we began business,
there were seldom more than three directors
present at the weekly board meetings, and these
were generally the same individuals, Messrs.
Francatello, Spencer, and Colonel Frost, all
three of whom were more or less interested in
obtaining accommodation from the concern,
seeing that they could not get it elsewhere, and
that if they—more particularly the first-named,
and the various friends he had introduced to
the bank—stopped payment, it was not unlikely
that the bank would stop also. To keep the
establishment going, they had to keep themselves
afloat, and to do this they had to use freely
both the funds and the credit of the bank; in
fact, after a time matters became so that these
three, the only directors who took any active
share in the management of the concern, were
employed day after day in propping up their
own credit and that of those persons whom
they had introduced to discount in the bank.

Just about this time another circumstance
occurred which helped greatly to hasten our fall.
I have mentioned in my previous paper that the
promoter of the company was Mr. May, who
was also our solicitor. I have also said how
this gentleman got five thousand pounds for his
share of the promotion money, out of which he