INVESTMENT OF FUNDS 
113 
anee of making deposits in non-member banks 
gave rise to much inconvenience and to an in 
crease in the expenses of administration—evils 
which non-member banks were not slow to bring 
prominently before Representatives in Congress. 
Carter B. Keene, Director of Postal Savings, 
said the restriction of deposits to member banks 
“resulted in the elimination of hundreds of State 
banks. In many instances it was necessary to 
send funds long distances to places where eligible 
banks were located. This worked embarrassment 
in the expeditious and safe administration of the 
service, and at the same time defeated the domi 
nant thought that controlled the finances of the 
organic Postal Savings act, that the deposits 
brought out of hiding should be released for com 
mercial purposes in the identical localities where 
they originated.” 14 
A number of hills were introduced in Congress 
providing for the reauthorization of State banks 
as depositories, and finally a hill (H. R. 7967, 63 
into operation. The Attorney-General of the United States 
has held that the inhibition on depositing postal savings 
funds in non-member banks applies only to funds available 
for deposit on and after the date when the system went 
into operation, consequently withdrawals from non-member 
banks have not been made except to meet the demands of the 
service.” 
14 Com. & Fin. Chron., A. B. A. Conv. Suppl., Oct. 14, 
1916, p. 192.