The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1876-03-25
"And Tilden TO0.'p
He is Called "slipf5ery sam"-A Neat but
of Him-He is Charged with Getting off
with S2S4 eco not H;s-Iaas he Gone to
Meet Pendleaoae

A'diii0a" w. LUZ ualter mas frequently been
referred to but IS Just now made more prcmi-
nent because suit has been brought against
Gov. Tilden in the United States court in New
York requiring him to show what he has done
with the surplus stack and bonds of the afore-
said company. The following statement was
made to representative of the st. Louis
Globe-Democrat by MIR. VIM. d. Griswold.
President of the st. Louis Transfer Co., who
was President of the road which it is alleged
that Gov. Tlden and his associates "gobbled
up"-a position he resigned to accept his pres
ent office. The Globe-Democrat says that Mr..
Gr'swold is man of high repute MOI only in
st. Louis but throughout the West where he is
kno wn as a successful railroad manager and a
business man of uLques'ioned honor and nteg-
rity. An account given by another party
makes still more unfavorable showing.
The following is the principal part of Gtis-
wod's statement:
The substance of the accusation, said Mr..
Griswold, stripped of all apparel of words aud
forms, is this "rhat Gov. Tlldep, in copfed-
GRAFTON with Charles Butler and Russell Sage
OF New York, about the year 1864 apprOpri-
ated bonds belonging TO said rail Dad company
amounting to upwards of 1884 900, and that
these bonds carried coupons of semi annual in
terest from 1862, aud that the whole amount
realized on the bonds and interest is now not
less than $500,000 THIS Russell Sage will be
remembered as of uuenviabe nOtorI-ty 10 con
neciIon with the Milwaukee and La Crosse
Railroad some dozen years ago, and more re-
Gently from Indictment for usurv found against
him by the grand Jury of New York city, ac-
counts of which we're published IN the leading
newspapers of the country.
Reporter-Who is Charles Butler?
MIR. Griswold-Chares Butler has been a
subservient instrument in the hands of Tilden
for twenty years. He has been long known in
Indiana as leach, DreyiDg upon the Wabash
& Erie canal fund of which he obtained con-
troll by sanctimoniOus DISCUSSES, and which b,
has finally exhausted, TO the sacrifice of every
original interest. By TideE's influence, and
tor sIbservance of purposes developed and
charged in the suit, he was kept in Office as
President of the st. LOUIS, Alton & Terre
Haute Railroad for several years He was a
very good hgure-bead, and very great con
venience TO Tilden and Sage.
Reporter-Please state the main facs of tn.
transaction, and where the crookeiness comes
in.
Mr.. Griswold-In 1862 the Terre Haufe,
Alton & st. Louis Railroad Company was reor-
ganized, by forecl sure OF the defauited mort
cages aud sale of the road under judicial de
cree, and purchase of the same by the par
ties in interest, through and in the name OF
agents appointed by them, called "Purchas
ing Committee" pursuant to formal plan Of
sale and reorganization sigoed by said parties
in interest, they being the bond and stockhold
ers Of the original corporation. Tilden, Sage
and Butler were uf this Purchasing Commit
tee," who purchased the road at the sale. The
consideration or purchase money was satisfied
by the bonds for which the foreclosure and sale
were Gecfeed, which had been surrendered by
the holders for that purpose. These holders of
old bonos were satisfied for the same BY an is
sue OF new securities in bonds aud stock by the
new corporation, which was directly organized
and ltstituted, pursuant to the plan of reof-
ganization. The practical mode of accom- plisb-
ing this change OF securities was this: Tb,
new corporation estimated by calculation the
quantity or number of bonds of the several
classes, and also the stock, common and pre-
ferred, which would be necessary to cover all
the interests and tights embraced 10 the pur-
chase.
This could only be done approximately, and
that there might be no de efficiency in the pro-
vision, surplus of the several classes of bonds
and stock was prepared, aud the whole amount
placed in the hands of the Purchasing Com.
mttee, from which the just distr button was
to be made. After final satisfaction was made
by such distribution to all persons who surren
dered their old securities according to the plan
of reorganization, an excess of bonds to the
amount of about 1884 900, besides $780, of
common and $131 900 of preferred capital
stock. at its par value, remained. For his pro-
fessional engineering and his agency service in
this business, Tilden charged aud was paid
S21 900. L could have employed any one of
fifty lawyers in Indiana or Illinois, who would
havet done it all better, more wisely and
quicker for S., 600. This man has an amazing
talent for looking WISE He is a theatrical
Scion. If simple question were proposed to
1im, which any Justice of the Peace in the
West could have answered instantly and cor
rect'y, he would shrink bimself into a physical
expression of mental labor and suffering such
as would startle or alarm the anxious qnes-
toner, which would at length terminate 10
profound doubt, worth not less than $1,000
Beng bit of lawyer myself, was not able
to realize the abstruse force of these transcend
ent demonstrations. But they were effective
in New York, since they have, with the aid of
bis miraculous moral facility in getting hold
of bonds, advanced him, in fifteen years, from
the state OF poor man TO the position of
millionaire.
Well. contr ued Mr.. Grswold, at a meeting
of the Board of Directors of the new corpora
tion, in New York CITY, in the summer of 1862.
the question Was discussed as to whether tb-
surplus of securities should be cancelled and
destroyed, or should BE- packaged up and placed
in secure deposit for such possible future use
as the welfare Of the road aud 1.-THE interests of
the company might require. The latter alter
native measure was agreed to. l do not re-
member what the records of the Board of
Directors contain as 10 this action. or whether
they contain anything but it will be remem-
bered by members OF the Board then present
hon. Anthony Thornton, late Judge of the
Supreme Court OF Illinois, was one of the
directors, and was present Mr. Il. Tousey,
now of Indianapolis, was Secretary and Treas
urer, and was also present Afttrsards these
bonds were abstracted from their place of de
Dosf, and the suit against Tilden, Sage aud
Butler is now brought for their recovery
They were members of the Board of Directors
OF the new organization, and continue until
June. 1875. These men have supposed them
selves sheltered in mpupity for their audaciou.
dishonesty by the fact tn At the common stock
of the company under their manipula-
ton has been and is worthless. This
calculation was realized for many years
The common stock of the company has beeD
quoted on the New York market a. from 10 to
4 per cent, and has been gambling card of
merely speculative value. Capitalists general
y could net afford to hold the stock as an III
vestment, aud H. one could afford the time,
worriment and expense which woald have been
required in proceedings of prosecution when
nothing could be gaiUed to himself, aOd tht
conspicuous result would be simpy dsgt ace
full exposure of the swipdle. And besides. a
large amount of the stock was owned and held
in ring for the protection of these raScaties.
This was used to control the elections in con-
nection with the bonds which have voting
power in that corporation. The better to pro-
tect aud perpetnate their power, they classified
the directors, so that only one-third or one
fourth OF the whole board went ou: annually,
and they were always reelected.
In 1873, it being discovered by several holders
OF this stock that the company were paying in
terest on an undue amount of bonds, and that
the coupons of the bonds which were of the
surplus were being collected semi.annually. a
few of them combined and resolved to make
an effort to upveil these frauds and to prose
cute the criminal parties They sought, and
were refused at the general Office in New York,
an inspection Of the voting registers of the
bundhoders, which We're under the control OF
these parties. They appointed committee to
come out to st. Louis to attend the election OF
Directors in June of that year, with such votes
as they could find without such registers, and
they employed an able young attorney and
counselor, Mr. w. G. Whitney. to come out
with them to aid to unearth these subterranean
operations Headed by Mr. Whitney, they ap.
peared at the meeting of the stockholders,
which was composed of Charles Butler him
self. carrying the preponderating proxies of the
New York ring and their dupes, with few
persons from Illinois, whom he had called to-
gether tor the occasion, Mr Whitney made
the flat charges and demanded their admis-
sion, or some explanation Of the excessive issue
of securities His demands were refused. He
offered resolution of inquiry into the charges
This resolution was resisted by Mr. Butler, and
by his direction was defeated.
Mr.. Whitney then obtained permission to
appear before the Board of Directors, organ
lied after the election, when he reiterated the
charges of fraud, and demanded an investga-