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496 A special meeting of the Federal Reserve Board was held in the °trice of the Federal Reserve Board on Wednesday, June 9, 1926, at 2:30 P.m. PRESENT: Vice Governor Platt Mr. Hamlin Mr. Miller Et. James Er. Cunningham Er. McIntosh Er. Eddy, Secretary Mr. McClelland, Assistant Secretary ALSO PRESENT: Yr. Uyatt, General Counsel. The Vice Governor stated that the meeting had been called at the reof Mr. James to permit him to submit a report on his recent visit to Ittlanta, Georgia, taken under the Board's instructions given at its meeton May 20th. Mr. James presented a memorandum dated June 2nd setting forth the details of his visit to Atlanta, during which he communicated P°r8enally to the Federal Reserve Bank of Atlanta and to the individuals cerned the Board's actions of lay 20th in voting that Yr. Joseph L. ' ell, Deputy Governor of the Federal Reserve Bank of Atlanta, be eliz4 'flated from the Federal Reserve System, and that the Federal Reserve tank of Atlanta be called upon to make a full and complete report of the transaction of that bank in connection with the movement of currency to ts Havana Agency on April 10th, including all instructions riven to the Party which accompanied the currency shipment and including also the 151*50 tal conduct of the members of the party which uccompanied the ship- r'errt, Upon notion, Er. James report was received and ordered filed. Mr. James then stated that in addition to his detailed report he 497 6/9126 -2- wished to submit for the Board's consideration the following resolution: "WHERLAS on or about April 28, 1926, certain information reached the Federal Reserve Board reflecting upon the character of service rendered by the Cuban Agency of the Federal Reserve Bank or Atlanta during the recent run on banks in Cuba which occurred on or about April 10, 1926; "7HEREAS, pursuant to resolutions dated l!ay 1 and Lay 20, 1926, the Federal Reserve Board caused investigations to be made of the recent run on American and other banks in Cuba, the assistance rendered bv the Federal Reserve Banks of Boston and Atlanta, through their respective agencies in Havana, the steps taken to meet the situation, and all circumstances connected With the shipment of currency by the Federal "Reserve Bank of Atlanta to Cuba; "-viiilEAS, it appears that the Federal Reserve Bank of Atlanta made a large shipment of currency to Cuba, which left Atlanta on a special train on Saturday, April 10, arriving in 4eY'viest on Sunday, J,pril 11, and was there loaded on the Cuban Gunboat "Cuba" and taken to Havana, where it was delivered on Monday morning, April 12; "1.TEREAS, it appears that Hr. Joseph L. Campbell, Deputy Governor of the Federal Reserve Bank of Atlanta had personal Charge and direction of said shipment of currency and of the Party accompanying it; that while in charge of said shipment he drank intoxicating liquor excessively and permitted other members of the party under his supervision to do likewise; that 12e railed to take proper steps to safeguard the money; that he railed to keep proper records and to make a prompt and full report of the entire transaction; that he took an unnecessarily large tumber of men from Key West to Havana on a pleasure trip, thus incurrinr unnecessary expense for the Federal Reserve Bank of Atlanta; and that he and his party were guilty of conduct unbecoming representatives of a Federal Reserve Bank; and %1ERLAS, it appears from these facts and from other inforIllation received by the Federal Reserve Board from time to time t lir. Joseph L. Campbell lacks those qualifications which are requisite and necessary for a senior officer of a Federal Reserve Bank; "BE IT RESOLVED by the Federal Reserve Board that: "1. Yr. Joseph L. Campbell be riven formal notice to aPPear before the Federal Reserve Board in its Board-room in the Treasury Building, ,iashington, D. C., at 10 a.m. on June , 1926, to show cause why he should not be removed from °Ifice as Deputy Governor of the Federal Reserve Bank of ',..t.lanta pursuant to the terns of Section 11(f) of the Federal Ileserve ACt; "2. At such hearing Mr. Joseph L. Campbell shall be 13r:mitted to appear in person, to be represented by Counsel, 1,11°• to produce any witnesses whom he desires to testify in his ' ehalf; and 1 498 6/9/26 -3- "3. A copy of this resolution shall be forwarded to Mr. Campbell and to the Federal Reserve Bank of Atlanta, through Yr. Oscar Newton, Federal Reserve Agent at Atlanta." Mr. James suggested that if the above resolution should be adopted by the Board that ':lednesday, June 16th, be fixed as the day for the formal hearing ordered in the resolution. The Vice Governor suggested that before acting upon the resolution slibmitted by Yr. James the Board give consideration to several communicatic "relatinp: to the subject thereof which have been received by the 4arcl Since Yr. James' visit to Atlanta. Thereupon, the Secretary read t0 the Board the following communications: Letter dated June 7th from the Federal Reserve Agent at Atlanta, submitting communication addressed to him under date cf June 4th by Mr. Y. B. Wellborn, Governor of the bank, submitting a report, as requested by the Federal Reserve Board, covering the transaction of the Federal Reserve Bank of Atlanta in connection with the movement of currency to its Havana Agency on April 10th, including instructions given to the party which accompanied the shipment, but not including the personal conduct of the members of the party, as requested by the Board, which is to be investigated by a committee of the Board of Direct ors of the bank. dith his letter, Governor Wellborn subitted statements made by Mr. L. L. Magruder, Manager of the ,11,ban Agency of the Federal Reserve Bank of Atlanta, and Mr. Bell, Cashier at the Head Office, as well as communioa1° "exchanged with an insurance agency relative to insurance cn the shipment of currency referred to. b Letter dated June 4th from the Chairman of the Federal Reserve Bank of Atlanta, enclosing certified copies of two resolu"ms adopted at a special meeting of the Board of Directors of e bank held an Monday, May 31, 1926, the first resolution with rcf erence to, and appointing a committee to investigate, the ecnal conduct of the party of officers and employees of the sreral Reserve Bank of Atlanta which accompanied the currency 1Pment made by the bank to its Havana Agency on April 10th, ;rid the second urging that the Federal Reserve Board put into ef_eet the tentative plan for the operation of the Havana agencies, der the Federal Reserve Bank of Atlanta, after consolidation of ,_? existing agencies, as submitted by the Special Committee apL'Inted by the Federal Reserve Board to investigate the recent l tuation in Cuba. j r l Letter dated June 4th from Mr. E. R. Black, a director of 6/9/26 -4- 499 the Federal Reserve Bank of Atlanta, and Chairman of the sPecial committee appointed under the resolutions adopted by the Board of Directors of that bank at its special meeting on ray 31, 1926, to investigate the circumstances in connection with the shipment of currency made by the Federal Reserve Bank of Atlanta to Its Havana Agency on April 10th. In his letter, Mr. Black (1) stated that the committee consists of Directors Melvin, tare and himself; (2) requested that the Board furnish the committee, or the Federal Reserve Bank of Atlanta for use of the committee, the charges made arainst the bank and its officers in relation to the shipment or currency to Cuba, the name or names of the party or parties king such charges, and the evidence concerning the Cuban shipment as Fathered by the committee appointed by the Board to investigate the matter; (3) stated that the Committee is ready at the Board's convenience to confer with the Board in line with the resolutions adopted by the directors of the I . ,tlanta bank; and (4) requested an expression from the Board ln reference to that part of the resolution of the Atlanta directors requesting the Board to defer action in the matter or the Cuban shipment until the bank's committee has had the oPPortunity to perform the duties imposed upon it by the directors' resolutions. Thereupon ensued a detailed discussion of the above communications 414 the resolution submitted by Mr. James, which during the course of the A. ' 10cussion was amended so as to read as follows: "WHEREAS, pursuant to resolutions dated May 1 and May 20, 1926, the Federal Reserve Board caused investigations to be ,ade or the recent run on American and other banks in Cuba, 110 assistance rendered by the Federal Reserve Banks of Boston and Atlanta, through their respective agencies in Havana, the ste,s taken to meet the situation, and all circumstances conIleeted with the shipment of currency by the Federal Reserve Idank of Atlanta to Cuba; "REPFAS, it appears as a result of these investigations that the Federal Reserve Bank of Atlanta made a large shipment er currency to Cuba, which left Atlanta on a special train on Saaturda7, April 10, arrived in Key "':.E)st on Sunday, April 11, Was there loaded on the Cuban Gunboat "Cuba" and taken to Ha where it Was delivered on Monday morning, April 12; "WHEREAS, it appears that Mr. Joseph L. Campbell, Deputy G Zernor of the Federal Reserve Bank of Atlanta had personal paarge and direction of said shipment of currency and of the b_P'Y accompanying it; that while in charge of said party he ?ame under the influence of intoxicating liquor and permitted call!r members of the party under his supervision to use intoxith'lnr liquor; that he failed to take proper steps to safeguard money; that he failed to keep proper records and to make a T 4 6/9/26-5- 500 Prompt and Pull report of the entire transaction; that he took certain men from Key West to Havana who had no duty to Perform on board the ship or in Havana and whose further Participation in the trip was merely for pleasure; and that he and his party were guilty of conduct unbecoming representatives of a Federal Reserve Bank; and "WBEREI.,B, Section 11(f) of the Federal Reserve Act provides as follows: 'Sec. 11. The Federal Reserve Board shall be authorized and empowered: !(f) To suspend or remove any officer or director of any Federal reserve bank, the cause of such removal to be forthwith communicated in writing by the Federal Reserve Board to the removed officer or director and to said bank.' "VHERPAS, it appears from these and from other facts received by the Federal Reserve Board from time to time that Yr. Joseph L. Campbell lacks those qualifications which are requi,ite and necessary for a senior officer of a Federal Reserve tank; ibts; IT PFSOLVED by the Federal Reserve Board that: 1. Er. Joseph L. Campbell be given formal notice to appear before the Federal Reserve Board in its Board-room in the treasury - Building, Washington, D. C., at 10 a.m. on June 16, 1926, to show cause why he should not be removed from office as Deputy Governor of the Federal Reserve Bank of Atlantapursuant to the terms of Section 11(f) of the Federal Reserve Act; 2. At such hearing Fr. Joseph L. Campbell shall be perto produce any witnesses whom he desires to testify in his behalf; 0. A copy of this resolution shall be .forwarded to Er. ampbell and to the Federal Reserve Bank of Atlanta, through 11'. Oscar Newton, Federal Reserve Agent at Atlanta." Following the discussion, upon motion by Mr. James, the above resolution as amended was unanimously adopted. Mr. Hamlin then moved that on the occasion of the hearing fixed for June 16, 1926, the Special Committee of the Board of Directors of the Federal Reserve Bank of Atlanta, consisting of Messrs. Black, Melvin and Ware, be invited to be present at the hearing and sit independently With the Board. Unanimously carried. James then submitted drafts of letters to Mr. Oscar Newton, 'Moral .0 , 'veserve Agent at Atlanta, Mr. Joseph L. Campbell, Deputy Governor 501 6/9/26 -6- er the Federal Reserve Bank of Atlanta, and the Federal Reserve Bank of Atlanta, which, after discussion, were amended and unanimously approved in 4 the following forms: "Mr. Oscar Newton, Federal Reserve Agent, Federal Reserve Bank of Atlanta, Atlanta, Georgia. My dear Yr. Newton : "There are enclosed herewith two letters, one addressed to the Federal Reserve Bank of Atlanta and the other addressed to Mr. Joseph L. Campbell, both of which are self-explanatory. "In your capacity as Chairman of the Board of Directors of the Federal Reserve Bank of Atlanta, and the official representative of the Federal Reserve Board at the Federal Reserve Bank of Atlanta, you are requested to present to Yr. Joseph L. Campbell personally the letter addressed to him and to advise the Federal Reserve Board when this has been done. "In your capacity as Chairman of the Board of Directors of the Federal Reserve Bank of Atlanta and the official representative of the Federal Reserve Board at the Federal Reserve Bank of Atlanta, you are requested to read to the Board of Directors of the Federal Reserve Bank of Atlanta, at its next regular or special meeting, the setter addressed to the Federal Reserve Bank of Atlanta and the resolution of the Federal Reserve Board enclosed therein. uhen this has been done, please notify the Federal Reserve Board of the fact. "By order of the Federal Reserve Board. Enclosures. Walter L. Eddy, Secretary." 11r. Joseph L. Campbell, Deputy Governor, Federal Reserve Bank of Atlanta, Atlanta, Georgia. S I.R "There is enclosed for your information a certified .(3Py of a resolution adopted by the Federal Reserve Board on "Une 9, 1926, making formal charges that you lack those qualifications which are requisite and necessary for a senior offi°er of a Federal reserve bank. "You are hereby notified to appear, if you so desire, before the Federal Reserve Board in its Board-room in the Treasur Building, Washington, D. C. at 10 o'clock a.m. on ' Tune 10, 1926, to show cause why you should not be removed y cif 502 -7 from office as Deputy Governor of the Federal Reserve Bank of Atlanta, pursuant to the provisions of Section 11(f) of the Federal Reserve Act. You will be permitted to produce any witnesses whom you desire to testify on your behalf. "By order of the Federal Reserve Board. Walter L. Eddy, Secretary." Enclosure. "Federal Reserve Bank of Atlanta, Atlanta, Georgia. Gentlemen : "There is enclosed for your information a certified copy of a resolution adopted by the Federal Reserve Board on June 9, 1926, setting forth the conclusion of the Federal Reserve Board that Pr. Joseph L. Campbell, Deputy Governor of the Federal Reserve Bank of Atlanta, iacks those qualifications which are rer uisite and necessary for a senior officer of a Federal reserve bank. "The Federal Reserve Board has served formal notice on 1.r. Campbell to appear before it in its Board-room in the Treasury Building, Washington, D. C., at 10 o'clock a.m. on June 16, 1926, to show cause why he should not be removed from office as Deputy Governor of the Federal Reserve Bank of Atlanta pursuant to the provisions of Section 11(f) of the Federal Reserve Act. "The Special Committee of your Board, appointed in accordance with the resolution of the directors of the Federal Reserve Bank of Atlanta adopted at their meeting on May 31st, a certified copy of which resolution was transmitted to the Federal Reserve Board in your letter of Juno 4th, is especially invited to be present at the hearing above referred to and to sit, independently, with the Federal Reserve Board. "By direction of the Federal Reserve Board. Walter L. Eddy, Secretary." EriclOS" The meeting adjourned at 4;10 p.m. 413111*cNed Vice Governor. it .1
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