The morning call., 1894-09-11
BIG LAND FRAUD.
Beatty'S Scheme for Max
ing Millions.
HAD A GRANT IN MEXICO.
To Which 1t Is Alleged He Had
No Title.
HAD A GRANT IN MEXICO.
JUST THE SAME HE. SOLD 1T.
Now the Stockholders i'm the East
Want a Receiver and an
Accounting.


cOmbe will be called upon tomorrow to
t'ke action with the object of prevent Dg
the continuation and final consummation
of what is characterized as one OF the
most colossal frauds in modern times.
The chief actor In this scheme, John c.
Beatty, an American, at present resides in
Texas. His victims include prominent
New Workers and other residents Of the
United States and Canada. How far the
scheme has succeeded has not yet been de-
termined. but one victim, James II. Beatty,
president of the Graman and Northwest
Insurance Company of Ontario. Canada,
and of the Federal Life Assurance Com
pany of Hamilton. Ontario, swears he has
lost $S7, 800, and il is charged that the goal
OF john c. Beatty's ambition was to
fraudulently obtain possession OF 81, 500, 900.
Tie cOmplainants in tho case. in addi-
ton t. James ii. Beatty, are James C.
Aiken, Benjamin II. Doane and Leo
Wormser of New York. The defendants
are Frank A. Miller. C. II. Dow, Samuel
n. Wood. F. ?. Earnest, Frank Church,
James \. Brown, Charles w. Kittridge,
j. ". Carlisle, Thomas j. O'Donnell of
California and John c. Beatty of Texas,
all directors or trustees of the Colorado
River Irrigation Company. The company
was first organized on January z, 1891, un-
der the name of the Arizona and Sonora
Land Irrigation Company, but the title
was changed on January 9. 1898. TO It's
present form. Its ostensihle object was
TO carry or the irrigation of land in Cali
fornia, Ar zona, Lower California and
Mexico. Its capital stock was 81, 500, GOO,
divided into 10000 shares Of $50 each.
According to the com plant, however,
the com pany was organized by John c.
Beatty for his sole interest and bene fit and
10 enable him to realize 81, 5OO,O 900 on a
tract of worthless land containing !, ,5OO,-
600 acres on the Alta River. in the province
of Sonora, Mexico. to which il is said he
did not even have a title. Having organ
ized the company and obtained the issue
of the capital stock by alleged fraudulent
and fictitious statements 1t is charEed that
John c. Beatty went about negotiating
with the object of transferring the land to
the company for the whole of its capital
stock, or $500, 900. The land formed
part Of what Is known in Mexico as the
"Jecher Concession" the meaning of
which is not explained in the complaint,
but it is charged that John c. Beatty had
no title to it.
The board of directors, it is charged.
were then. as now. the mere tools and
creatures of John C. Beatty, ready and
willing at all times to carry out his be-
hests. The president Of the board was
Charles II. Dow, and by vote of the ma
jsrity it was agreed to transfer $50, 900
shares of the company TO John C. Beatty
for 81. 500,0 0O0 as soon as ii was possible TO
carry out the transfer. The directors,
being Mr.. Beatty's tools, made no effort to
investigate either the character of the
land or the genuineness of Mr.. Beatty's
title to il.
To further facilitate matters Mr.. Beatty's
board of directors decided to appoint him
manager, with exclusive control of affairs,
at salary Of $4,000, while Frank A. Mil er.
concerned with Beatty, WAS elected vice
president Of the company and also given a
salary OF $1,000 year, both of which trans
actions are charged to be illegal
The first transfer of stock was made on
January 10. 1894. by the board of directors,
when $4,000 shares were transferred TO
John c. Beatty, on the basis of $50. 900
acres of land, or one share for each ten
acres. John c. Beatty himself presided
of James II. Beatty. stakeholder, il was
agreed to issue 56, 600 shares of new stock.
In March last James Fl. Beatty obtained
from the Supreme Court of the State of
New York mandamus requiring the di-
rectors to show him the books, but John
G. Beatty went to California, taking the
minu books of the transactions with
him, and James II. Beatty was unable to
get the evidence he wanted concerning the
title of the Jecher concession.
The known assets of the company did
not exceed $4,000. 1t has had no bank
account since last October, and was
obliged t. give up its Office at 66 Broad
way, this city, last July for non- payment t
of rent. Its offices in Philadelphia.
Washington and other cities mad been
previously given up. after the country for
miles around had been flooded with pros
pectuses and pamphlets declaring the land
an FL Dorado. Tie only place the com
pany now has an Office in is PrOyi-
dence, r. l.
The company's known property in Cali
fornia consists OF chattels worth $39617,
which John c. Beatty by a bill of sale,
alleged to be fraudulent, transferred to the
engineer. Charles L. lockwood. without
any consideration. In addition to this,
lockwood, it is said, is still ORA wing $500
month in wages for doing nothing, and the
company owes him $4,000. although he
never did anything for it.
Judge Lacombe will be asked to ap-
point receiver to take charge OF the
analrs OF the company. He viii also be
asked to declare that the issue of sc. COO
shares OF stock was spurious and illegal.
and that the contract between the diree-
tors on the one side and John C. Beatty
on the other was fraudulent and ultra
Vlres, and that the whole transaction was
void. An Injunction is asked for to pre-
vent Beatty from selling or transferring
any part of the stock or certificates excsnt
under direction of the court.
James Ii. Beatty, the Canadian. mr.
chased 10000 shares and paid up sac. 600
and each one of those mentioned as com
plainants holds 555 shares. At the present
T.