Evening star. [volume] (Washington, D.C.) 1854-1972, 1891-08-11
SWINDLING BY WHOLESALE.
A sloan" Association That Has Gathered !
Hundreds of Thousands Of Dollars.

"Loan" Association That Has Gathered in
Hundreds of Thousands Of Dollars
Alfred Downing, president. and N. H. Toll
man, vice president of the National Capital
Savings Building and Loan Association Of
North America, were arrested yesterday in
Chicago by Post Office Inspector Stuart.
charged with using the mails for fraudulent
purposes 1t is charged that the men who have
been conducting the association have swindled
thousands of people from every state in the
giving nothing in return. The victims hail
from Maine to California, and are numbered
among the rich and poor alike.
From facts already in the possession of the au-
thorities. the scheme will parallel that Of the
great Fund W" swindle. which was broken up
about five years ago. There are still two men
at liberty. they having disappeared several days
ago. Those two men that are missing, it is be-
iieved, got away with most Of the funds For
six months and more letters have been received
from all parts of the country by the post office
and city authorities in Chicago protesting that
the National Capital Savings, Building and Loan
Association Of North America was not what its
projectors represented it to be- and that it was
collecting money and making no loans.
HOW THE SCHEME WAS WORKED.
Inspector Stuart has been working ON the
case for months. He found that the concern
was gigantic in its reach, and had agents in
every state in the Union, who were selling the
$40 600, 900 OF stock Of the company. Tho
scheme was advertised through these agents,
who were sent circulars and documents show
ing the association to be gilt edged. At the
time Capt. Stuart took charge OF the
Louis F. Mortimer, the general manager and
secretary, was apparently the responsible man
and handled the cash received in large amounts
nvynr do - AL
office frequently disguised letter carrier,
in order to secure evidence.
Several weeks ago Mortimer disappeared and
yesterday, after having waited in vain for his
return, Capt. Stuart decided to secure the other
visible members of the combination. George
o. Ferguson of Lincoln. Neb., representing
about sixty victims in his city, was summoned.
With his assistance the necessary evidence was
completed and the arrests made. Three young
lady clerks were taken into custody as wit
nesses. Mr.. Ferguson in an interview said:
The association was represented in our town
by local firm, acting in good faith.
1.-THE people of Nebraska are very much in
favor Of the building and loan association plan
and the offers OF this concern were snapped up
quickly. 1t sold shares for so cents each, with
payment of S11.0 each month for ninety-six
months. at the end of which time a 81, 900 loan
would be paid for. Then there was a member
ship fee OF $50. an apprasement fee Of $40
and S45 for three months payment in advance,
thus making s95. The concern made one $500
loan that was genuine, and this was just enough
bait to lead others to invest and hundreds sent
their money to Chicago and on the strength of
the loans they expecte', to make contracts for
homes Stores were let and building begun.
''The month never came, and we wrote on
here to learn what the trouble was, and finally
Prof Elwood Of the Wesleyan University. who
was quite heavy investor, came to Chicago to
investigate. He visited the Office and Manager
Mortimer seemed to be such a fine business
man, and gave such assurances that the loans
would be forthcoming, that Prof. Elwood went
back satisfied. But the money never came and
finally laid the case before the post office
authorities
Inspector Stuart and District Attorney Mil
christ went over the books OF the concern, and
found that seventeen legitimate loans have been
made in as many states. These, it would seem,
were made to allure other investors as in the Ne
braska case. No record Of any other loans could
be found, although the books show that money
has been received from hundreds Of people from
the places where the single loan was placed.
A rough estimate of the amount Of money
received is Sl75, 900 in the year and a half the
association has existed. Downing and Toll
man were held in 81, 600 bonds each b. Com
missioner Hoyne. Both had lawyers on hand
and Tollman was quickly bailed out. Downing
was unable to secure bondsmeu and spent the
time in the custody of deputy marshal One
of the attorneys for the men said there was no
doubt the concern was rotten to the core, but
he believed Downing and Tollman were simply
victims of Mortimer's guile.