W. Harris thus describes the banking scheme:—
"Subscribers for stock were allowed to pay the amount of their subscriptions in town lots at five or six times their real value; others paid in personal property at a high valuation, and some were paid in cash. When the notes were first issued they were current in the vicinity, and Smith took advantage of their credit to pay off with them the debts he and his brethren had contracted in the neighborhood for land, etc. The Eastern creditors, however, refused to take them. This led to the expedient of exchanging them for the notes of other banks. Accordingly, the Elders were sent into the country to barter off Kirtland money, which they did with great zeal, and continued the operation until the notes were not worth twelve and a half cents to the dollar."*
* "Mormonism Portrayed," p. 31
Just how much of this currency was issued the records do not show. Hall says that Brigham Young, who had joined the flock at Kirtland, disposed of $10,000 worth of it in the States, and that Smith and other church officers reaped a rich harvest with it in Canada, explaining, "The credit of the bank here was good, even high."* Kidder quotes a gentleman living near Kirtland who said that the cash capital paid in was only about $5000, and that they succeeded in floating from $50,000 to $100,000. Ann Eliza, Brigham's "wife No. 19," says that her father invested everything he had but his house and shop in the bank, and lost it all.
* "Abominations of Mormonism Exposed" (1852), pp. 19, 20.
Cyrus Smalling, one of the Seventy at Kirtland, wrote an account of Kirtland banking operations under date of March 10, 1841, in which he said that Smith and his associates collected about $6000 in specie, and that when people in the neighborhood went to the bank to inquire about its specie reserve, "Smith had some one or two hundred boxes made, and gathered all the lead and shot the village had, or that part of it that he controlled, and filled the boxes with lead, shot, etc., and marked them $1000 each. Then, when they went to examine the vault, he had one box on a table partly filled for them to see; and when they proceeded to the vault, Smith told them that the church had $200,000 in specie; and he opened one box and they saw that it was silver; and they were seemingly satisfied, and went away for a few days until the elders were packed off in every direction to pass their paper money."*
* "Mormons; or Knavery Exposed" (1841).
Smith believed in specie payments to his bank, whatever might be his intentions as regards the redemption of his notes, for, in the Messenger and Advocate (pp. 441-443), following the by-laws of the Anti-banking Company, was printed a statement signed by him, saying:—
"We want the brethren from abroad to call on us and take stock in the Safety Society, and we would remind them of the sayings of the Prophet Isaiah contained in the 60th chapter, and more particularly in the 9th and 17th verses which are as follows:—