The Washburn leader. [volume] (Washburn, McLean County, N.D.) 1890-1986, 1891-07-18
A D%ASTARDLY SCHEME.
From Devils Lake Inter Ocean.

A DASTARDLY SCHEME.
From Devils Lake Inter Ocean.
The following, from the Washington
News-Times. correctly:outlines n swindling
scheme which originated in this city:
Copies of n circular letter have been
received in this city which reveal the OK
istence of Il dastardly scheme to swindle
eastern people Who have made investments
in North and South Dakota. The letter
comes from II loan and mortgage company
of Devils Lake and is sent to the people
in the small towns of eastern states who
have taken advantage of the big rates of
interest offered in the west to put their
small holdings into real estate mortgages.
1t is desired to swindle snch of these as
have held mortgages signed by farmers
who have been forced by the short crops
of the last two years to default on their in
terest. In spite of the prospects for n
bountiful crop all over the northwest, this
wear these would-be money-makers send
out a gloomy letter. saying that grasshop-
pers. drouth and storms have ruined every
thing. and advising the small mortgageo
to sell his mortgage ut 25 per cent of the
face value. According to the letter from
Devils Lake this firms purpose is to buy
the mortgage from eastern holders and
when the big crop is harvested resell them
mt a large advance. The same cOresOOn-
dent says that n stock company has been
formed and this swindling scheme started
on Il large scale. three or o u st. Paul men
being in it. 1t further says that these
very men are among those who originally
induced the eastern people to make the
investment. No names are mentioned.
The Inter-Occan has been aware for
some time that a scheme of this kind was
ON foot. and has only refrained from OK
posing it because there was n possibility
of securing the names of all tho parties i'm
plicated. Not many names nave been OBJ
tanned, we are sorry to say. as the scheme
in fact was not fully matured. The e1-
posure will kill it. 1t is alleged that the
svndisate embraced residents of Devils
Lake.. Grand Forks. st. Paul and Min
neapolis and possibly Others outside of
these cities. 1t was a big scheme and it
required plenty of money; hence the orig
inators were compelled to go outside of
this city for capital. So far rs can be
learned enough money has been secured to
enable them to commence operations, ana
the work of fleeing the eastern investors
was started about Il week ago.
The plan which they expected to pursue
was precisely as outlined in the News
Times article. Having access to the books
of one or more mortgage loan companies
they had at their command the address of
numerous eastern parties who had invested
their money in North Dakota mortgages
and land. 1t was the widows and orphans,
the farmers and mechanics of the east,
people who had in the past trusted to the
honor and manhood of the members of the
syndicate by allowing them to invest their
little savings, that this gang were now
trying to rob. The syndicate reasoned,
no doubt correctly, that many OF the people
who held these mortgages we're poor n
dcpended for a living on the income derived
from the interest thereon. They had re-
ceived no interest for several years. owing
to unfortunate crop failures, and many OF
them no doubt were on the verge of power
tv. Under such circumstances, and espe-
cially after reading the false reports con-
tanned in the syndicates' circular, they
would be willing to sell for what the syn
dictate was prepared to offer them-25
cents on the dollar.
It is almost impossible to realize h
effect this scheme, carried out on the e1-
tended scale planned by the syndicate,
would have on the future of the state. 1t
would surely nave driven investors away
for a LON time to come. The farmers and
mechanics of New England would certainly
refuse to invest their savings in a state
where the borrowers only returned 20 per
cent. Capitalists would not intrust their
money to men who were SO devoid OF prin-
ciple as to enter into a scheme like this.
It would, in fact, practically drive eastern
out of the state. It would totally
destroyed North Dakota's credit. 1t il
hoped that exposure has buried the scheme
so deep that there will be no resurrection.