In 1772 an action interesting to the public was brought against the Bank. It appeared from the evidence that some stock stood in the joint names of a man and his wife; and by the rules of the corporation the signatures of both were required before it could be transferred. To this the husband objected, and claimed the right of selling without his wife's signature or consent. The Court of King's Bench decided in favour of the plaintiff, with full costs of suit, Lord Mansfield believing that "it was highly cruel and oppressive to withhold from the husband his right of transferring."
On the 10th of June, 1772, Neale and Co., bankers, in Threadneedle Street, stopped payment; other failures resulted in consequence, and throughout the City there was a general consternation. The timely interposition of the Bank, and the generous assistance of the merchants, prevented many of the expected stoppages, and trade appeared restored to its former security. It was, however, only an appearance; for on Monday, the 22nd of the same month, may be read, in a contemporary authority, a description of the prevailing agitation, which forcibly reminds us of a few years ago. "It is beyond the power of words to describe the general consternation of the metropolis at this instant. No event for fifty years has been remembered to give so fatal a blow to trade and public credit. A universal bankruptcy was expected; the stoppage of almost every banker's house in London was looked for; the whole city was in an uproar; many of the first families were in tears. This melancholy scene began with a rumour that one of the greatest bankers in London had stopped, which afterwards proved true. A report at the same time was propagated that an immediate stoppage of the greatest Bank of all must take place. Happily this proved groundless; the principal merchants assembled, and means were concocted to revive trade and preserve the national credit."
DIVIDEND DAY AT THE BANK
The desire of the directors to discover the makers of forged notes produced a considerable amount of anxiety to one whose name is indelibly associated with British art. George Morland—a name rarely mentioned but with feelings of pity and regret—had, in his eagerness to avoid incarceration for debt, retired to an obscure hiding-place in the suburbs of London. "On one occasion," says Allan Cunningham, "he hid himself in Hackney, where his anxious looks and secluded manner of life induced some of his charitable neighbours to believe him a maker of forged notes. The directors of the Bank dispatched two of their most dexterous emissaries to inquire, reconnoitre, search and seize. The men arrived, and began to draw lines of circumvallation round the painter's retreat. He was not, however, to be surprised: mistaking those agents of evil mien for bailiffs, he escaped from behind as they approached in front, fled into Hoxton, and never halted till he had hid himself in London. Nothing was found to justify suspicion; and when Mrs. Morland, who was his companion in this retreat, told them who her husband was, and showed them some unfinished pictures, they made such a report at the Bank, that the directors presented him with a couple of Bank notes of £20 each, by way of compensation for the alarm they had given him."
The proclamation of peace in 1783, says Francis, was indirectly an expense to the Bank, although hailed with enthusiasm by the populace. The war with America had assumed an aspect which, with all thinking men, crushed every hope of conquest. It was therefore amid a general shout of joy that on Monday, the 1st of October, 1783, the ceremonial took place. A vast multitude attended, and the people were delighted with the suspension of war. The concourse was so great that Temple Bar was opened with difficulty, and the Lord Mayor's coachman was kept one hour before he was able to turn his vehicle. The Bank only had reason to regret, or at least not to sympathise so freely with the public joy. During the hurry attendant on the proclamation at the Royal Exchange, when it may be supposed the sound of the music and the noise of the trumpet occupied the attention of the clerk more than was beneficial for the interests of his employers, fourteen notes of £50 each were presented at the office and cash paid for them. The next day they were found to be forged.
In 1783 Mathison's celebrated forgeries were committed. John Mathison was a man of great mechanical capacity, who, becoming acquainted with an engraver, unhappily acquired that art which ultimately proved his ruin. A yet more dangerous qualification was his of imitating signatures with remarkable accuracy. Tempted by the hope of sudden wealth, his first forgeries were the notes of the Darlington Bank. This fraud was soon discovered, and a reward being offered, with a description of his person, he escaped to Scotland. There, scorning to let his talents lie idle, he counterfeited the notes of the Royal Bank of Edinburgh, amused himself by negotiating them during a pleasure excursion through the country, and reached London, supported by his imitative talent. Here a fine sphere opened for his genius, which was so active, that in twelve days he had bought the copper, engraved it, fabricated notes, forged the water-mark, printed and negotiated several. When he had a sufficient number, he travelled from one end of the kingdom to the other, disposing of them. Having been in the habit of procuring notes from the Bank (the more accurately to copy them), he chanced to be there when a clerk from the Excise Office paid in 7,000 guineas, one of which was scrupled. Mathison, from a distance, said it was a good one; "then," said the Bank clerk, on the trial, "I recollected him." The frequent visits of Mathison, who was very incautious, together with other circumstances, created some suspicion that he might be connected with those notes, which, since his first appearance, had been presented at the Bank. On another occasion, when Mathison was there, a forged note of his own was presented, and the teller, half in jest and half in earnest, charged Maxwell, the name by which he was known, with some knowledge of the forgeries. Further suspicion was excited, and directions were given to detain him at some future period. The following day the teller was informed that "his friend Maxwell," as he was styled ironically, was in Cornhill. The clerk instantly went, and under pretence of having paid Mathison a guinea too much on a previous occasion, and of losing his situation if the mistake were not rectified in the books, induced him to return with him to the hall; from which place he was taken before the directors, and afterwards to Sir John Fielding. To all the inquiries he replied, "He had a reason for declining to answer. He was a citizen of the world, and knew not how he had come into it, or how he should go out of it." Being detained during a consultation with the Bank solicitor, he suddenly lifted up the sash and jumped out of the window. On being taken and asked his motive, if innocent, he said, "It was his humour."
In the progress of the inquiry, the Darlington paper, containing his description, was read to him, when he turned pale, burst into tears, and saying he was a dead man, added, "Now I will confess all." He was, indeed, found guilty only on his own acknowledgment, which stated he could accomplish the whole of a note in one day. It was asserted at the time, that, had it not been for his confession, he could not have been convicted. He offered to explain the secret of his discovery of the method of imitating the water-mark, on the condition that the corporation would spare his life; but his proposal was rejected, and he subsequently paid the full penalty of his crime.
The conviction that some check was necessary grew more and more peremptory as the evils of the system were exposed. In fourteen years from the first issue of small notes, the number of convictions had been centupled. In the first ten years of the present century, £101,061 were refused payment, on the plea of forgery. In the two years preceding the appointment of the commission directed by Government to inquire into the facts connected with forging notes, nearly £60,000 were presented, being an increase of 300 per cent. In 1797, the entire cost of prosecutions for forgeries was £1,500, and in the last three months of 1818 it was near £20,000. Sir Samuel Romilly said that "pardons were sometimes found necessary; but few were granted except under circumstances of peculiar qualification and mitigation. He believed the sense and feeling of the people of England were against the punishment of death for forgery. It was clear the severity of the punishment had not prevented the crimes."