St. Paul daily globe., 1892-12-30
Extensive Brokerage Firm Of
New York Forced to
the Wall.
Private Speculation by One
OF the Partners Caused
the Failure.
Large Amounts Of the Firms
Money Used by Him
in Deals.
How Much Money He Used
Cannot Be Told at
Present.

NEW YORK. Dec. 29.-Ihe failure OF
the firm of Wayland Trask & Co. was
announced today on the stock exchange.
The firm was composed of Wayland
Trask, Theodore Baldwin and A. n.
Rankin, and had offices at Is Wall
street. The failure has been expected
since yesterday, when the firm Dotfied
its customers that they must take up
their own contracts. Mr.. Trask has
been memper of the exchange since
1869. The cause of the failure at first
was thought to be too much confidence
in Northern Pacific securities. A later
explanation, given below. put an en-
tirely different light on the matter.
What gave rise to the Northern Pa
cific theory was the fact that the house
was carrying large loads of these secur-
tiles, which have for the past year been
declining steadily in value. During the
past few days they have been particu-
larly weak. The per cent bonds sold
down to 66I yesterday and today. The
preferred stock sold down to 447s this
morning. Heavy selling was due to
liquidation of loans by Wayland Trask
q Co., the declining price of the stock
having made it impossible for them to
keep margins good.
Hts Effect Discounted.
The failure caused no excitement In
the street, as the trouble has been
known for several days. although it
was generally believed that failure
would be averted. The firm gave suffi-
cient notice to those with whom they
had contracts. Hence, when the failure
was announced this afternoon it was
also announced that the firm had no
outstanding contracts. Mr.. Irask, when
seen this afternoon, declined to say any
thing about the failure of his firm, and
referred every one to his lawyer, b. III.
Stearn, of No. 40 Wall street. Mr.
Stearn gave out the following statement
concerning the firm:
,'The suspension of the firm of Way
land Trask q Co. is due to the fact that
one of the partners, Theodore Baldwin,
has been speculating on his own account
and with the firms money. He has lost
in this way about Sl50,000. Nothing was
known of his operations until Monday
or Tuesday, when some of the banks
sent to TraSk q Co. for additional
margin Oh their loans. This led to all
investigation, and it was discovered that
the books were all wrong and that
Many Fictitious Entries
had been made upon them. Mr.. Trask
saw that he could not honorably con-
tinue in business and resolved to
suspend. Baldwin has confessed every
thing and is now at work helping the
expert with his work in Strengthening
out the books"
Baldwin's methed of operating was to
enter number of fictitious names upon
the firms books and conduct his specu-
lating under those names. The money
to margin these accounts he took from
the firm and covered up his tracks by
making false entries on. the books. He
also conducted operations with other
firms in Wall street, also using his
firms money. and this, of course, must
be made good. Mr.. Stearn would not
say VINO these houses were, nor
could give even an approximate esti-
mate of the amount of assets and Ia
bilities of the suspended firm until the
expert examination was concluded. He
said that the $l50,000 lost by Baldwin
was also an estimated amodnt. 1t might
turn out to be much more. Baldwin's
speculations have been going on for
about three years, and we're, OF course,
entirely unknown to his firm. He has
been speculating in almost every stock
OH the list, it is SAID, and, while it was
rumored that ne had been
Especially Hard Hit
on Northern Pacific, Chicago Gas and
Omaha, lawyer Stearn said it looked as
if he had lost in everything he touched.
Baldwin became member of the
present firm in 1881. coming to them
from E. G. Benenict IL Co. He was "a
resident of Brooklyn, and has always
had an excellent reputation. 1t could
not be learned whether or not any pro-
ceedings of any kind would be taken
against him. He is said to be completely
broken down by his misdoings, and has
expressed his willingness to do anything
asked OF him. Waylaud Trask has been
a member OF the stock exchange for
twenty-four years, and is very popular.
Over S300.C00 was offered to him today
byevarous firms to help him out, but he
declined all assistance until he could
discover the real amount OF his partners
defalcation. The firm had no outstand
ing contracts on the exchange, having
notified the firms with which they were
dealing TO close out their contracts.
They also sent around this morning and
paid off all their loans at the banks.
Mr. Trask said today that he had been
nearly all night for the past three days
trying to Straighten matters out.