Savannah morning news. [volume] (Savannah) 1868-1887, 1884-05-22
TRIED TO BULL THE STOCK.

eurities Have Been Misapp1ied.
Ugly rumors. says Tuesdays New York
Times, connecting the name of we'll
known railroad President with serious
defalcation were quietly passed from
mouth to mouth in Wall street yesterday
afternoon. At first the rumors were re-
eeived with incredulous smiles, except
by those persons who were in position
to know what had been going on. Com
paratiyely few Of the great mass Of bust
ness men in the financial centre Of the
city could be made to believe that G. G.
Baldwin, President Of the Louisville and
Nashville Railroad Company, had been
guilty of any such Irregularities as were
| alleged.
That something was the matter, how
| ever. was clearly evident from the down.
ward tendency of the Louisville and
| Nashville stock in the Stock Exchange.
| The stock dropped about three points yes
terday and it had tumbled about fifteen
points within a week. Late in the after
| noon it became generally known that Mi.
/ Baldwin had resigned the Presidency OF
the company and had been succeeded by
/ Mr.. J. :. Rogers.
The rumors then took definite shape,
| and it was openly alleged that Baldwin
/ had been hypothecating the cOmpany's
| securities to raise money for private spec
/ ulatiYe purposes. 1t was stated that he
| had used large portion Of the $2,OOO,OOO
of bonds issued by the company, but not
| sold. to build a bridge over the Ohio
/ river at Henderson. These bonds are
| known as the Henderson Bridge bonds.
| A member of an enterprising brokerage
/ firm is authority for the statement that
/ Mr. Baldwin borrowed 100000 some time
ago on securities belonging to the Louis
/ vile and Nashville Company. Within the
past few days the original lenders called
| in their loan, and Mr.. Baldwin was
| Obliged to raise the money elsewhere.
! President Baldwin, as the story goes,
| formed a pool with Jay Gould, Russell
/ Sage, f. H. Green, W. :. Williams, +. b.
| Carver and others to ''bulP' Louisville
1 and Nashville stock. The pool embraced
great many millions of dollars, and the
| losses are believed to have been very
/ large. 1t is alleged that Gould and Sage,
| as usual, have prOfted at the expense OF
| the others. They are accused OF having
/ unlOaded their own holdings upon the
! other members Of the pool. Mr.. Gould
went into Louisville and Nashville
some months ago for the purpose of sacur-
| ing the extension Of the Western Union
wires along the line of that road. and he
| has especially cultivated Baldwin. who
was an influential member Of the Union
/
| his son George elected a member of that
! club. Baldwin, after eXhausting his own
! financial means in bulling Louisville and
| Nashville, appropriated the money and
| securities Of the company. The amount
Of the default is variously stated at from
| 100000 upward. Mr.. Gould was
cited last night as authority for
| the statement that Baldwin was
| forced to restore 100000 10
| the company yesterday to avoid a
| criminal prosecution. A gentleman con-
yersant with the facts said: II do not
understand that by doing this he made
| complete restitution to the company, but
| you can perceive that through the techni-
| calities of the law he might be criminally
| liable for a portion OF the money he had
| taken. and not for the rest. That is to
say, he may be able to defend himself as
| to a part OF the default by declaring that,
as President of the company, he had used
| its funds for the protection ofits property,
| but not able TO make the same defense
| with regard to the remainder, which he
would, therefore, have to replace to save
| himself from a criminal prosecution"
The directors OF the company were in
| session during most of Saturday and near
! " all Of yesterday. Baldwin made a
! statement to them of what he had done,
| admitting at first the abstraction of a
/ small amount, and then, it is asserted, as
I he was pressed, he acknowledged larger
| and larger figures. The full amount has
not been definitely stated by the directors,
! but it was generally put at three-quarters
of a million. When they had ascertained
| the true state Of affairs, the directors, ac-
| cOrding to current report. endeavOred to
| get Baldwin to resign, but he. not SEEM
ing to realize the gravity Of his situation,
wanted to hold on to the Presidency. At
length, by an artifce, they got him to
leave the room, and then they promptly
| depOsed him and elected J. ;. Rogers,
| President Of the Rogers Locomotive
Works, President. After this action was
taken Mr.. Baldwin's resignation was
written in the next room by his lawyer,
Mr.. Cadwallader.
The gentleman already quoted said
"Besides abstracting the money and Sc
| curities of the company it appears now
that he also falsifed the reports of the
company. In his last annual report he
stated the floating debt of the company at
81, 600, 600, while recent Investigations
show that it was then $4,000, 000. In adj
ditiOn to this, he is said to have dragged
many Of his friends into his operations
and ruined many of them. Being prom.
inent member Of the Union Club, he was
naturally much looked up to and all the
more able to influence men prominent in
society. The Union Club is like a funeral
assemblage. This is a terrible business.
The fact Of man socially prominent and
the head Of a great corporation beng
ruined by such questionable operations is
apt to give a very serious blow to public
confidence, and more especially serious
for coming just at this time of widespread
uncertainty in financial affairs"
''Wh effect will it have on the future
Of the rOadY
''Well, you can already see the effect on
the stock, which has fallen about Is points
in the last week. don't think it will have
any appreciate effect on the bonds of the
road; but the worst feature is the general
effect of shaking PUBLIC confidence in rail.
road enterprises"
"What securities did Mr.. Baldwin alb
stract from the cOmpanyY
"Oh, the stocks and bonds of the Louis
vile and Nashville Company and its
subordinate corporations"
''Were the securities what are known as
the Henderson Bridge bonds -
Not as / am informed"
''Is it not unusual for a railroad COM
pany to hold much Of its 1oated securi-
ties z"
"Well, it may be as a rule, but the
Louisville and Nashville Company had on
hand humble, of its own securities"
"What is the sum total of money'and
securities and the relative proportions of
each taken by Baldwin,"
81 don't know. l have given YOU the
figures as L have heard them, but | sup
pose the actual facts are not vet known
and can be ascertained only by degrees"
''You say that Jay Gould has been cult
waiting Baldwin for the purpose of getting
his son, George Gould, elected a member
of the Union Club. Has George been
elected:"
"No; he has been black-balled; or at
least if he hasn't been black-balled he will
be.0
A meeting of the officers and directors
of the road and few other prominent
railroad men was held at Mr.. G. C. Bald
wins house, No, II East Tbirtv-ffth
street, last night. Mr.. j. S. Rogers. the
new President of the road, was present.
Mr.. Baldwin declined to give any reasons
for his resignation, claiming that they
were purely personal. f. d. Carley, Of
Louisville, Third Vice President of the
road, said: "Mr. Baldwin was simply
tired out with hard work, and wanted a
change. Mr., Rogers, his successor, Is one
of the largest stockholders in the road and
an old member of the Board of Directors.
He is we'll known in connection with the |
Rogers Locomotive Works. That is all we |
care TO say about the matter tonight"
"Had Mr.. Baldwin's retirement any
thing to do with the reported hypOtheca- !
tiOn Of Henderson Bridge bonds to raise |
money to bolster up the stock y
''There is no trouble about that. The |
Henderson Bridge bonds are all right"
"DOes Mr.. Baldwin's resignation take |
effect immediatelyY7
eyes; but he retains his connection
with the road, and will work cordially for |
it,"
Az Mr. Baldwin was leaving the offices |