Delaware gazette and state journal. (Wilmington, Del.) 1883-1902, 1889-01-10
A BIG sUGas sWINDLE.
How Macy Brokers We're Dipped {
flhe Extent nj a9aD.fflO.

eleclric Sugar renNiEH htock IL jingthhu
had fallen from G83 TO El9 per share, be-
cause Of the receipt of news from America
that there was fraud in connection with
the "new process" hos exposed gigan-
tic swindle. Some time ago sugar ex-
pefts gave il out that they were inter
ested in new electrical process" that
WAS destined to reVolutionize the old way
OF refining sugar, which had been discoy-
ered by Henry O. Freund of this city.
The samples he exhibited showed the
product to be of the greatest pusity. Re-
hnere wanted to see the process of
refining, but Freund steadfastly
declined to allow it, claiming that
it was not pateutable invention,
and that in order TO protect himself he
would not dare to allow any one to see
how he achieved his marvellous results.
II company could be formed, however,
he kaid he would DO willing TO explain
the l,:onesa and sell the secret to the COM
pany. Finally, about year ago, a COM
pany IVES formed, OF which W. W. Cot
terill was chosen president and j j. Rob-
artson treasurer and secretary. Offices |
were htted zip az No 50 Wall ai1eet, and
factory established on Hamilton avenue
| ia BROOKLYN. The company was capital |
| the 10 coo shares, 3, 600 we're sold in Eng
land, and every sugar refinery there owns
some OF them.
| No one bat Freund, his wife, man
/ named Howard aud Elk ignorant work
men were allowed to enter tina inner re-
ceases of the factory where the refining
IVES supposed TO be going on. The ma
obinery with which the factory was fitted
| hU
was supposed to be of most unique
character, but no one ever saw it. People
| interested in the company were allowed
to stand in an outer room and hear the
crushing machinery ct work, and after
csitain tina specimens of wonderfully
pure sugar, alleged to have been refined
within from raw sugar, were shown to
them. The sugar samples were analysed
By experts and chemists, and pronounced
to be Of marvellous purity.
Last March, before preparations for
fuli blast operations had been completed,
Freund died, leaving, as he said, his
great secret in the possession of his wife,
who, OF the proper time, would reveal it
TO tho company. The suspicious OF the
officers were aroused some days ago when
It was found that Mrs. Frennd and all
who had been connected with the factory
had disappeared, Mrs. Freund leaving
word that she had gone to the west.
President OotteIill, Treasurer Robertson
and number of stockholders proceeded
! to the factory and broke into tho secrbt
rooms. There was no mysterious cleo
trirai apparatus. There were crushers,
!, and that was oil; not o pound OF raw
sugar had been refined at the factory.
t Quantities of refined sugar, chiefly cubes,
} had bsen prepared in aome secret spot,
: with chemical liquid which eliminated
the ordinary Impurities found in all
. sugars. This ''doc: oredn Dugaf was then
I cafted to the factory in bags, purporting
TO contain raw sugar. When everything
/. was ready tho orushers in tho secret
:, room were Get in motion and the cubes
!. were broken into smaller pa -, &C.
L cording 10 the grade desired w N the
: refined sugar began 60 come OF. VI the
q "shoots" two floors bslow all who saw II
maryele3 OF the genius which could turr
raw sugar into refined in 80 short q time
Mrs. Freund and those connected witt
her received large Hum of money In easl
estimated at over $250,000.
The case has been placed in 1nspeoto
u Byrne's hands, and the arrest Of the par
A. ties upon tho charge of swindling is ex
"a pected. Other arrests will probabl.
h. follow those OF the ringleaders. Another
}. method pursued by the swindlers was t.
1t moisten large quantities of granulatet
d sugar with water, the sugar being thei
dried in an oven. This caused the pRrti
!, cles to adhere together in big chunks o
q blocks, which were then shipped in larg
l. boxes to the Brooklyn factory. Wher
I. this work Of preparation wGs performer
isstill unknown. When the boxes arriyel
?. at the factory the officers of the compan.
" were told that they contained valuabl
= !. electrical machinery. The big Jumps be
" ing placed in the crushers were easil
!, broken up, and the result was that the
became granulsted sugar again.
The officers Of the company and man
reputable brokers who advocated til
y, y scheme are very much annoyed at havin
"a been the innocent Instruments OF 80 gros
- o swindle.
OF THE STOCK FALLS TO THIRTY sHILLINds
II II LIVERPOOL, Jan. 5.-Shares of til
i. Electric Sugar Refining Company hav
!. fallen to 80 shiilings. Warrants hav
ar been issued for the apprehension of Mrs
a. Freund and her step-father, W. J
e. Howard, who was q director of the com
p Y pany and had charge of the factory i
% Brooklyn.
u special from New York says: Their
"a are many further interesting develop
ie inents in the Electric sugar Refinin
n Company fraud. Treasurer Robertso
has unpacked himself Of lot of detail
concerning the phenomenal swindls thH
captured experts as easily as il did OF
or binary spectators. He said on Satusda
~ =, that z ,207 shares Of the stock are held i
n tho United States aud Canada by e5 pei
~, sons, and that 696 British stakeholder
be are in possession OF 2,793 shares. Mrs
IN Friend, widow OF the Prof. Henry N
he Friend, who originated the acheme, Q
10 one time had $50 shares, but it ia til
y; general belief that she has sold most {
40 them at high figures. Nearly all tn
shares were sold at from $500 to owe
$500, and in November they we're quote
3rs here and in Liverpool at Sii5, tne pc
n value being $lG0. Taking, $500 as til
p. average purchase price in this countr
=. and supposiag that Mrs. Friend stl
"A holds her $3.50 shares, it would leav
d, / ,957 shares held by persons in the Unite
q: States and Canada who had actually pal
er, for the stock, and their loss would /
A. S587, 1G0. In England the average prie
paid was $500, and thus the loss thei
would reach Silly 200, total here on
Or abroad of 81 .T0i 800, which may be il
a. creased by just 80 much as may hay
of been realized by the sale of sha.es hsl
as BY Mrs Friend. The company now hs