Appointed by Lord Erskine, 1806–7, to a commissionership in bankruptcy, Montagu set himself to reform the bankruptcy law. He also founded in 1808 the Society for the Diffusion of Knowledge upon the Punishment of Death, with William Allen. In July 1825 he gave evidence before the chancery commission, and suggested a radical reform. In Trinity term 1835 Montagu was made K.C., and soon afterwards accountant-general in bankruptcy. His tenure of this office, which lasted until 1846, he established the liability of the Bank of England to pay interest on bankruptcy deposits.