FEBRUARY 25, 1863 – NATIONAL BANKING ACT PASSED

1863 – NATIONAL BANKING ACT PASSED
It provided for the national chartering of banks by the federal government. This replaced state charters – many of which contained much more rigid and democratic provisions. The Act in numerous ways standardized banking across the country. The act established National Banking Associations, the office of the Comptroller of the Currency and a system of national chartered banks with control over all of them coming from Washington. The new banks were given virtaully tax free status. In doing so, it entrenched what some have called “structural fraud” of the banking system – creating money out of thin air and charting interest on it.