It has been intimated in the preceding paragraph that the immigrant “banker” makes no distinction between the funds deposited with him and his own property. This is generally the case. Occasionally the banker will keep the deposits in his safe, in the original wallets in which they were delivered to him,[[249]] or deposit them in a bank in his wife’s name,[[250]] but these are exceptional instances. Ordinarily all the money in the banker’s possession is lumped together, so that the assets of the “bank” are identical with the general resources of the proprietor. Furthermore, there is a great amount of laxity in the giving of receipts to depositors. Sometimes no written acknowledgment whatever is given; from this point the character of the receipt varies all the way up to a regular pass book, and a thorough system of bookkeeping.
From such a beginning as this, these banks have developed a variety of forms, varying in functions and in stability. They have been classified by the Immigration Commission into three main groups, as follows:
“I. State and incorporated banks or highly organized private institutions thoroughly responsible and operated in a regular manner almost exclusively as a bank. There are comparatively few of these institutions.
“II. Privately owned steamship agencies, and real-estate offices which masquerade under the name of a bank, but which are not legally authorized as such. To this class should be added groceries and saloons in which the banking functions are clearly defined as apart from other business. The majority of the banks investigated are of this class.
“III. Banks which may or may not be known as such, but in which the functions of caring for deposits and receiving money for transmission abroad are extended more as an accommodation or as incidental to the main business of the concern. Saloon keepers, grocers, boarding houses, barbers, and men engaged in similar occupations usually conduct this class of banks. It has been claimed by some that every immigrant saloon keeper will be found doing a banking business of this character. This is the largest, as it also is the most irresponsible, class. It is undoubtedly the hardest class to regulate, as it is the one about which it is the most difficult to obtain accurate information.”[[251]]
The hold which these bankers have over their patrons is due in the first instance to the ignorance of the latter, and the feeling of security which they have in dealing with people of their own race. It is increased by the familiarity which the banker has with business methods in this country, and names, places, and methods in the old country. The immigrant banker assumes a decidedly paternalistic attitude toward his patrons, and renders them many services not ordinarily associated with a banking business, such as writing and translating letters, securing employment, giving legal advice, etc. The greater the hold thus secured, the wider are the opportunities for exploitation. In the absence of proper control, and of the ordinary safeguards of such businesses, the immigrant depositor is made to suffer extortion and loss in countless cases. In many cases this is due to the ignorance of the banker, and his total unfitness for the assumption of such responsibilities; in many others, it is due to dishonesty, greed, and willful intent to defraud. In the panic year of 1907 large numbers of these banks failed, and sums of money were lost to immigrants, the importance of which is to be judged, not so much by the total amounts, as by the fact that they represented the savings of a large number of individuals in meager circumstances. In normal years, there is a steady loss, due to failures, defalcations, and abscondings on the part of bankers, and also to the continual petty frauds, habitually practiced by many of these men. The trustfulness of the immigrants towards men of this character is surprising. Instances are known where men have come into a community, advertised a bank, and in a few weeks accumulated large sums of money from the foreigners, with which they promptly decamped, leaving absolutely no means of redress to their creditors.
The primary functions of these banks are the safe keeping of money and the transmission of remittances abroad. Only in exceptional cases do the other banking functions play an important part. It is estimated that in 1907 approximately $137,500,000 in foreign remittances passed through the hands of immigrant bankers, in sums averaging about $35.[[252]]
These banks are mostly in the hands of the recently immigrating races. The reasons for their existence—ignorance of language and customs, illiteracy, inconvenient hours kept by American banks, and their luxurious appearance and requirements of cleanliness—appeal much less strongly to the immigrants from northwestern Europe.
Another functionary who exercises an extensive, and often baleful, influence over the immigrant is the notary public. The position of dignity and influence held by corresponding officials in foreign countries leads the immigrant to accord too much confidence and trust to such persons in the United States, who are often ignorant and in many cases dishonest men. The nature of the cases in which the immigrant has recourse to them gives them a large amount of power over the foreigner, and opens the way to many petty extortions.
All of these exploiting agencies become inextricably mingled in actual life. The functions of the padrone, the labor contractor, the employment agent, the steamship agent, the boarding boss, the saloon keeper, the grocer, the banker, the notary public—any two or more of these may be combined in the person of a given individual, who exercises a corresponding control over the destiny of those who are dependent on him. His hold over them rests upon the fact that they are not Americanized, and it is wholly to his interest to keep them so.[[253]]