banks in Philadelphia - Philadelphia, PA

Bank Information

Episode Type: Suspension → Reopening
Bank Type: state
Start Date: May 26, 1842
Location: Philadelphia, Pennsylvania (39.952, -75.164)

Metadata

Model: gpt-5-mini
Short Digest: a72cfb84

Response Measures

None

Description

Article (Lynchburg Virginian, 1842-05-26) describes the second suspension of the banks in Philadelphia and specifically refers to the North American Trust and Banking Company as a failing institution into whose vaults large specie deposits were made by Mr. Hoyt to prop it up. The piece reports a suspension but gives no explicit statement about permanent closure; many such suspensions were temporary, so I classify as suspension_reopening. Corrected OCR issues (e.g., deposite(s) -> deposits).

Events (2)

1. May 26, 1842 Other

Newspaper Excerpt: Mr. Hoyt ... actually loaned to it nearly $100,000 in gold and silver ... to sustain a sinking bank; advance in the price of the stock through these operations exceeded 20 per cent.
Source: newspapers

2. * Suspension

Cause: Bank Specific Adverse Info
Cause Details: The bank was described as 'failing' and in 'bad credit'; suspension linked to institution-specific insolvency/embarrassment driven by bad stock operations and poor creditworthiness (not attributed to mere rumor).
Newspaper Excerpt: At the time of the second suspension of the banks in Philadelphia, the Collector deposited in specie nearly $1,000,000, within a very short period, in the vaults of a failing bank
Source: newspapers

Newspaper Articles (1)

1. May 26, 1842 Lynchburg Virginian Lynchburg, VA

Article from Lynchburg Virginian, May 26, 1842

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Article Text

VOL. XX.-No. 86. the general opinion at the board of brokers, that Mr. Hoyt was greatly embarrassed in consequence of his stock opera- tions, and that many brokers having demands against him compromised with him on that account. The witness is of opinion that these embarrassments were occasioned by bad stock operations before Mr. Hoyt became Collector. From these facts and circumstances it may be fairly in- ferred that the stock operations of Mr. Hoyt, after he be- came Collector, were carried on through selected bro- kers, with money drawn from the receipts at the custom House in New York. Several other brokers testified that they had been employed by Hoyt to purchase stocks for him after he was Collector-that he was in embarrassed circumstances at the time of his appointment-that these embarrass- ments grew out of stock operations prior to his appoint- ment, and not in those which occurred afterwards,- as after his appointment he paid large sums on his old indebtedness. There can be but little difficulty, from this evidence, in arriving at the conclusion that the public money in the custody of the Collector of the Customs at New York was, from time to time, appropriated to his own use in stock speculations. The transactions of Mr. Hoyt with the North American Trust and Banking Company call for particular notice: At the time of the second suspension of the banks in Philadelphia, the Col- lector deposited in specie nearly $1,000,000, within a very short period, in the vaults of a failing bank, the stock of which was animated or depressed, according to the frequency and amount of these deposites. Mr. Hoyt himself, being a large speculator in this stock, through the agency of certain brokers in Wall street, held the destinies of the bank in his own hands, and could purchase stock at the depression, and sell out at the moment of making his own deposites, at a large advance. For no other purpose than to promote his own interest, at a time when the institution was in bad credit, and in which no prudent merchant would deposite a dollar, actually loaned to it nearly $100,- 000 in gold and silver, while the Treasury was empty and the Government compelled to issue its own notes to meet the current demands on the Treasury. In some instances the advance in the price of the stock through these operations, exceeded 20 per cent. This profit ac- crued exclusively to the Collector and his friends, who were advised of the intended deposite before it was made. Mr. Hoyt made a sweeping business of the pub- lic money at the Custom House in New York. He paid old debts, dealt largely in stocks, loaned money to sus- tain a sinking bank, to say nothing of elections, and re- wards to favorites and partizans; and all these high- handed acts were committed in the face of the American people, and if not fully approved by the Executive, pas- sed without rebuke, until they resulted in the defaleation of Mr. Hoyt to a very large amount, a knowledge of which, by Congress, arrested his career and drove him from office. In addition to the encroachments made directly by Hoyt on the money received for imposts at the Custom House, he derived an immense revenue, on his own pri- vate account, from the following sources: His salary, as Collector, $4,400; duties paid under protest, amounting, at one time, to $150,000; compro- mises with foreign importers, on suits and prosecutions instituted, or threatened, $89,343; storage at the public stores, $30,000; fees retained, $36,000; sale of burnt goods in Front street, $20,000; duties retained from 1838 to 1841, $1,853; duties in the hands of Mr. Hoyt for goods under seizure, the cases being not yet tried, $4,426; duties retained in a case pending in the Circuit Court, $2,984; duties paid, on which the Auditor says he can give no information, $3,533; duties paid to Hoyt and credited to the Government in the cash book, return- ed as cash duties in his weekly return to the Treasury Department, and subsequently withdrawn without be- ing credited in the quarterly return $8,250; duties receiv- ed in 1839 and passed to the credit of the Government in 1841, $3,890; duties not credited to the Government in the quarterly return to the Treasury department, $38,755; amount of entries on which the duties had been received, abstracted from the office of the cash- ier during January, 1841, not debited to the Collec- tor, $63,039; excesses of cash balances received at the Custom House and paid to the Collector, of which no entry was made on the cash book, $2,824,-making the aggregate sum of $459,477. These sums were retained by Hoyt, and not entered on his quarterly returns to the Treasury Department. On all money so held by him he paid no interest to the Government, while money in the New York market was commanding a very heavy rate of interest, at 5 per cent. a month. In all contro- versies arising out of the seizure of goods, it became the interest of the Collector to procrastinate the decision as long as possible, because, in the meantime, he held the duties, and the accruing interest enured to his benefit so long as the goods remained under seizure. The same benefit resulted to the Collector on duties received under protest. All these advantages Mr. Hoyt enjoyed, besides the immense sums which he claimed as his exclusive right, and his unqualified appropriation of money receiv- ed at the Custom House to purposes of his own, in vio- lation of law, and of official duty and integrity.