That was confirmed by the organic act of 1890 and then again in the enabling act of 1906; and the Constitution of our State which accepted the conditions in the enabling act made it an agency of the State and also provided for the commissioners. They are elective officers, and ex officio members of the board.

At the time of statehood I believe land donated was a little more than 3,000,000 acres valued at $31,000,000. That land was most of it, all of it, practically, on the west side of Oklahoma Territory. The Government had no unallotted lands on the east side, and in lieu of land Congress appropriated $5,000,000 in cash which was added to this fund originally.

The permanent fund has increased to the present time, according to our financial statement, to $67,000,000. In the meantime we have paid out $71,000,000 out of the earnings received.

Up until recently most of the business had to do with loaning money to farmers on farm land. The funds mught be invested in farm mortgages, municipal bonds, or United States Government bonds.

At the present time we have only $17,000,000 invested in farm loans. During the years the State acquired considerable lands on the east side or in the Indian Territory by foreclosures-suits brought on delinquent mortgages for interest and installments of the mortgage. Mr. ARNOLD. Was that on Indian lands?

Mr. MARLIN. Most of it was Indian lands. I would say about 40 percent of our loans through the years have been on land titles on the east side.

Mr. SCHWABE. But not direct to the Indians?

Mr. FERNANDEZ. The loans were not made to the Indians? Mr. MARLIN. In a great many instances they were made to the Indians. Since 1907 we have made 55,000 loans in the State. At the present time we own in the Indian Territory 107,000 acres of land undisposed of that was acquired in foreclosure proceedings.

Mr. STIGLER. That covers the Five Civilized Tribes area?
Mr. MARLIN. Yes, sir; it does.

Mr. MUNDT. Will you insert how many of those tracts of land were acquired through foreclosure against Indians themselves?

Mr. MARLIN. I do not have it, but if possible I will get it. I would suggest it would be a difficult task to go back through the records, but I will be glad to make the best estimate we can.

Mr. MUNDT. That will be all right.

Mr. MARLIN (indicating). This is not very voluminous and if you care you could insert it in the record. It simply gives the counties and the number of tracts and the total acreage in each county. Then it gives the total number of tracts and the total acreage. It may not be of any value.

Mr. STIGLER. Without objection it may be inserted in the record. (The information is as follows:)

Mr. ARNOLD. How were those tracts of land acquired?
Mr. MARLIN. They were sold at sheriff's sale at public auction.
Mr. SCHWABE. How were they acquired?

Mr. MARLIN. Well, the State got them by virtue of being the highest bidder at public auction.

Mr. SCHWABE. You did not know when you get them whether you got them for a song.

Mr. MARLIN. I would say this, that the present policy of the commissioners is and has been to have the security appraised before the sale and that the State's minimum bid is the appraised value. The reason for that is that the permanent fund is to be kept inviolate and it becomes an asset in the fund and is put back in the fund for what it is worth.

Mr. HOLMES. That would be a very unusually fair deal.

Mr. MARLIN. Yes, sir.

Mr. MUNDT. Do you want to put that tabulation in the record? Mr. MARLIN. If there is no objection.

Mr. MUNDT. I would suggest that you include in that tabulation the number of acres taken from the Indians.

Mr. SCHWABE. Is it humanly possible to compile the data my friend suggests? You cannot determine who are Indian holders of land out of all those who have been foreclosed. You cannot do that to save your life. They are all restricted and you cannot determine whether they are white men, Negroes, Indians, or anybody else.

Mr. MARLIN. That is true.

Mr. STIGLER. There is nothing on the application to indicate that.
Mr. MARLIN. That is right.

Mr. MUNDT. Could the Indian Office supply that information?
Mr. MCCASKILL. We could not do it.

Mr. MUNDT. Would the Indian Office be able to supply the information? I presume you have records in your office showing holdings of the Indians and you should have a record of when the Indian was deprived of his holdings. Can you supply the information to the committee as to how many acres the Indians have lost to the land office fund of the State of Oklahoma?

Mr. MCCASKILL. I dislike to guess. We would not have a record of unrestricted lands.

Mr. FLANERY. This all applies to unrestricted lands. If they are restricted lands they would not be subject to encumbrance.

Mr. MARLIN. Originally as you say there were restrictions, but as time went on their restrictions were removed and they were allowed to sell their lands and they did sell them to various people, so that the Indian lands got in the hands of whites, colored, and anybody else that wanted them and as their restrictions were removed they could borrow money from the school-land commission as well as the white man who purchased the land. They have no records of that and it would be impossible to supply that information.

Mr. MUNDT. In the Sioux country you could tell by the name of the owner whether he was an Indian, or not.

Mr. SCHWABE. I want to say to the gentleman from South Dakota that it would be an impossible task.

Mr. ARNOLD. I can see why the oil companies are interested in this, but I do not understand why the State of Oklahoma is interested? Mr. MARLIN. Our interest is simply this that if we loan money on land as security which comes within the ruling enunciated by any one of these three cases discussed here we lose the money we put out on the loan. The Indian is not required to tender the money back. Mr. ARNOLD. You are interested then to about the same extent as the oil companies?

Mr. MARLIN. More so, for this reason: There has been another case decided recently by the Federal courts which affects the State of Oklahoma pecuniarily. It is still in litigation for the reason it was reversed and remanded for trial; but the circuit court of appeals decided recently in the case entitled "United States of America v. Fuston et al. (No. 2878, January term, 1944)," that the statute of limitations or the statute of repose did not operate in favor of the sovereign for the reason that the State had not given its consent to be sued, so that puts us in a much worse condition than the oil companies, or the individual.

Mr. ARNOLD. When you get these lands under foreclosure, say from the Indians, what do you do with them, try to farm them?

Mr. MARLIN. Yes, sir; sometimes we farm them until we have an opportunity to offer them for sale.

Mr. ARNOLD. You do not want them but want only to get your money out of them?

Mr. MARLIN. That is right, and put the land back on the tax rolls. Mr. BUNKER. Have you authority to lease for oil production? Mr. MARLIN. Yes, for the last 2 years we have had a sale of oil and gas leases I would say on an average of one every 2 weeks.

Mr. HOLMES. Let us take a practical case. Suppose you loan $5,000 to a party from your school-land fund and you have to foreclose because he is unable to meet his obligation. Then what do you foreclose on? A title that you are not sure of?

Mr. MARLIN. We were sure of it when we took it and we foreclose on the title that we have.

Mr. HOLMES. But this involves invalidated titles which we have been discussing this morning, does it not?

Mr. MARLIN. Yes, sir; it does; and the same thing that invalidates the title is the thing that causes the trouble in partition proceedings. However, the title examiner passed the title and the money was paid out on the loan and then we find out afterward the United States

Government was not made a party to the partition proceedings in which the land was partitioned in kind and restrictions not removed. That clouds the title.

Mr. FERNANDEZ. And in some cases you have sold that land?
Mr. MARLIN. In many cases.

Mr. FERNANDEZ. Well, the State in that case, would it be liable if the title turns out to be bad?

Mr. MARLIN. No; the State would not be liable.

Mr. BUNKER. I believe you said you had $17,000,000 of loans?

Mr. MARLIN. Yes, sir.

Mr. BUNKER. What percentage is involved in these questionable titles?

Mr. MARLIN. We have made these estimates. We have nine lawyers in the Department. Without examining the records which you know would be a big task, we have estimated that 5 percent of that amount would fall within the rule announced in these three cases, and in addition to that that same percent would fall within 107,000 acres which we own, which is 5 percent of the investment, or in other words around $1,000,000.

Mr. BUNKER. In other words you would estimate that at about $1,000,000?

Mr. MARLIN. Yes, sir; and then we cut it in half and said one-half a million dollars.

Mr. SCHWABE. Mr. Marlin, in regard to the three court decisions which have ruled adversely against your school-land fund, have you attempted to ascertain how much your losses would be by reason of these decisions?

Mr. MARLIN. Yes; we did that.

Mr. SCHWABE. Over what period of time did you do that work? Mr. MARLIN. From 2 to 3 months.

Mr. SCHWABE. And in the resolution you have presented here, passed by the school-land commissioners you estimated your loss as being approximately $500,000?

Mr. MARLIN. That is correct.

Mr. SCHWABE. Directly traceable to the defective titles?

Mr. MARLIN. That is correct.

Mr. SCHWABE. So that the State will lose as a result of those decisions, out of the school-land trust fund approximately $500,000? Mr. MARLIN. That is what we estimate our losses will be.

Mr. SCHWABE. Is there any other large loaning organization in the State which loans funds to farmers other than your agency?

Mr. MARLIN. Yes, sir; the Federal land bank at Wichita, Kans. Mr. SCHWABE. You and the Federal land bank are the two principal loan agencies?

Mr. MARLIN. Yes, sir.

Mr. SCHWABE. In fact there are no other loan companies which function in Oklahoma any more?

Mr. MARLIN. Not to any great extent.

Mr. SCHWABE. So that all loans obtained have to be obtained either through your office or from the Federal land bank?

Mr. MARLIN. That is true.

Mr. SEMPLE. How many lawyers have you in your organization? Mr. MARLIN. We have four title examiners and four foreclosure lawyers.

Mr. SEMPLE. And you have the best qualified lawyers you could get?

Mr. MARLIN. We have two lawyers for examining Indian titles, one Indian title examiner and one assistant; a man who was in Coal County about 30 years.

Mr. SEMPLE. If you were to attempt to go through all your loan files to ascertain how many actual Indians would be involved in titles which would come in these cases, that would be a very difficult task, would it not?

Mr. MARLIN. It would be; I want to help this bill all I can. It would necessitate an examination of all those titles and if we were able to trace the title down from the original allotment to the present day we could find out.

Mr. SEMPLE. Is there not a case being held up by Judge Rice, and if that opinion is not changed you stand to lose approximately $8,000? Mr. MARLIN. I believe I must answer "Yes-no." Originally we took a mortgage from some Indian heirs and paid out on the mortgage; and no payments were made. on this loan. We brought suit on the mortgage. More than 5 years passed after the deed went on record. The Government brought suit to evict the State's tenant and the State intervened in the Federal district court. After the State intervened then the issue seemed to be a question of whether or not the statute of limitations applied to a sheriff's deed issued to the State of Oklahoma under the act of 1926. The lower court decided in favor of the State under the Hastings Act. Then when it came to the circuit court of appeals they decided the case wholly on one question that is that the Indians had no right to bring suit to set aside the sheriff's deed or quiet title for the reason that the sovereign had not given its consent to be sued and reversed the case. Later a writ of certiorari was denied. It was remanded with directions at the suggestion of the Department that an order removing restrictions back in 1916 be presented to the trial court in order to determine whether or not it was broad enough to remove restrictions not only of the allotted land but of the inherited land as well and that question now is before Judge Rice.

Mr. SEMPLE. But that case is controlled by the rule?

Mr. MARLIN. That is true.

Mr. SEMPLE. And your loss by reason of the Hellard case is around $8,000?

Mr. MARLIN. In that particular case that is true.

Mr. HOLMES. A few minutes ago you mentioned Federal loans as well as the loans of your commission?

Mr. MARLIN. Yes, sir.

Mr. HOLMES. Would these same conditions not prevail on the loans made by Federal agencies?

Mr. SEMPLE. Yes, sir; absolutely. In the decision by Judge Rice, which was mentioned a few minutes ago, he found that the chief function of the agency which had authorized the investment of Indian trust funds in these lands had been to actually take money from one Indian and give it to another.

Mr. HOLMES. And invested their funds in property the validity of the title of which was in question?

Mr. SEMPLE. Yes, sir; so that what has grown up here is a system in a process of evolution in which the Government itself has been a