The advocate and Topeka tribune., 1893-09-06

nounce in their literature one Of the bes
banks In the city as q repository" Of thei
tfnnds This sounds to the unsuspecting per
son like sound financial business, when II
l fact 10 means nothing more than that they de
posit their money in this bank, which can bt
drawn by check at any time just the same a.
an individual can draw money he has depOs
tied In bank.
These companies most often catch the poorer
classes Of people, those who are least able tC
bear it. But what becomes OF the thousands
Of poor unfortunates who are holding thE
sack when the scheme "busts?" which it event
/ ually viii do because IL has no foundation
upon which to rest
These companies often have "paid notices
in some Of our very best magazines and news
papers In the country, and sample copy Oi
some influential magazine is placed in the
hand Of each agent to assist him to dispel any
doubts which may arise in the minds Of any
person he sOltcits.
Parties Of good business Judgment otherwise
are sometimes caught in these companies; but
when they discover 1t they quietly let 1t drop
and say nothing about 1t, because they are
ashamed to let people know the agent was
smarter than he, and 80 the swindle goes on.
Imagine an institution with $l00O0,0O0 liza
bilities and not dollar in either money
stocks, bonds, mortgages, or anything else to
back 1t; no deposit with our state treasurer as
o guarantee; no nothing except confidence
that there will be future investors in their
bonds and that they will continue to pay their
monthly installments.
Read what the Hon. George S. Merrill, the
insurance commissioner of Massachusetts says
in his annual report of 1898 on this subject.
He Is acknowledged authority everywhere on
such topics. 1t Is as follows:
Unfortunately the Legislature listened to
the siren songs Of the tempter authorized the
formation Of corporations of like character
with the Iron Hall, and legitimatized the bus
tness Of the two endowment concerns then in
this commonwealth. Immediately after the
passage OF this act corporations upon the Iron
Hall plan, with such variations in the scheme
as to be II possible more absurd than the orig
inal. sprang rapidly into existence, until fifty
six were chartered. Although not permitted
by the statutes Of this Commonwealth, there
promptly followed the organization in other
states OF myriad Of the so-called numerical
bond investment companies" which swept
over the border into Massachusetts, like q
swarm Of locusts, the scheme being just one
bit more grotesque than that Of the Iron Hail.
and with the endorsement Of the Legislature
as to the latter, tens OF thousands OF the people
OF this commonwealth were deluded into tax
Ing certificates in these bond concerns only
to see them disappear as swiftly as they had
arisen.
SO speedily did the character of the Iron
Hall business become transparent that the
Legislature OF 1890 enacted law that no more
corporations Of this kind should be chartered
or admitted; The beginning Of the end came
before the close Of the year 1891, when con-
siderable proportion Of these corporations
came to grief and fell into the hands Of re
ceivers. Last year the Iron Hall, the father Of
the whole brood, met with utter and IRE
trieveable collapse and, Of the fifty-six corpor-
at1ons receiving Massachusetts, charters only
eight were in existence when the statute clos
Ing their affairs was proposed.
The Rllurements Of the Iron Hall system
were sufficiently captivating to induce the en-
trance into various corporations of this class
and OF Its twin sister, the numerical bond con-
Germ, Of probably round million Of people in
this country, including men Of more than or
dinary intelligence; and in the history of this
and perhaps In no other commonwealth has
an official been 80 bitterly and virulently as
sailed by the mistaken and deluded victims Of
promising scheme as was the insurance COM
missioner of Massachusetts,, because Of his
persistent opposition to the VagaT1es of this
much-vaunted system Of finance, blasphem-
ously 1aunted as founded upon the father
hood of God and brotherhood Of man." The
loss Of millions Of dollars which has been en-
tailed, the depletion Of savings bank deposits,
the debts incurred, the deprivation and want
which has come to tens Of thousands Of people,
generally OF class not able to afford 1t, and
the utter and deplorable collapse OF every cor
poratton OF this name and nature, AFFORD q
sufficient and complete VindicstiOn Of the po-
sition assumed from the outset by the insur-
ance department Of this commonwealth"
Our former attorney general, the Hon. John
N. Ives, gave o written opinion strongly con-
demning these so-called bond Investment
which opinion is fully concurred
in by the present attorney general. The clos
ing sentence Of that opinion is as follows:
"Until the legislature shall, by some addi-
tional legislation, provide that such corpora
tions may be formed in the state, and provide
for the protection Of the parties who may be
induced to invest in their so-called bonds, l
am clearly OF the opinion that the business
which they contemplate doing is illegitimste
and should not be tolerated In the state, much
less sanctioned by any OF the state officials"
Hereafter all companies, officers, or agents
or foreign, found operating in the state of
Kansas will be prosecuted for swindling.
In conclusion, we hereby ask the assistance
Of all good citizens in stamping out this fraud
and swindle, by reporting to the secretary OF
state the names of companies officers or
agents doing business within the limits Of the
state OF Kansas. RS. OSBORN,