The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1894-11-16
DREAD U. $. SECURITIES.
Germans Are Afraid to Invest in American
Railway stocks ANY More.


WAsHISeToN, Nov. 16.-Frank H. Ma
son, United States consul general at
frankfort, in a special report to the state
department, states that American rail-
way securities have fallen into bad odor
il Germany, and he endeavors to point
fout the reasons therefor and suggests
measures for rehabiIitating them in the
financial world
He saws that in Frankfort, which was
the first European money market to &C
cept United States bonds buring the
dark DAYS of the war and in which Ameri-
can investments had been popular, not
only are our new securities refused be-
cause of American origin. but these rail
road bonds and stocks had for years been
returned to America and their proceeds
invested in less remunerative Prussian
consols and other standard securities
backed by government credit and super
vision.
The consul general says: "The cloud
which Overshadowed American railway
securities in Germany has been raised
mainly by the revelations of the past two
years concerning the management of
several leading railway properties. Ger
man investors were heavy losers and
their losses served to call the attention
of the people and press more sharply
than ever before to the usurpat'Ons Of
power and evasiOns of responsibility
which. it is claimed, have become SO
numerous.
European bond and shareholders have
been informed that the power of the
president and directors IN many impor-
fant railway cong anies has become prac-
ticallv omnipotent aud irresp onsible.
They have sent over protests and proxies
to be used at elections for the purpose of
wrestling the control Of corporate prop
critics from the hands of officers who
we're said to be abusing their trusts, and
they have seen these and every other
effort toward a change easily and hope
lessIy defeated
THAT the accounts of an entire railway
system may be falsitied and its securities
sustained in the market by fictitious
statements of earnings and cOncealment
of rebates-aU Of which is believed
here-are discoveries Of comparatively
recent date"
The uniform reply Of the German
fnanciers, when asked what is requisite
to restore European confidence in Amer
lean railway securities, is that such cor
Dorations should be brought under the
control of a prehensIve federal law"
Coneul General Mason says that the
German railroad license system is not
tpplica BILE in its entirety to America, but
a .ds in conclusion:
1T is believed by many whose expe-
rience and interests in both countries en-
title their opinions to respect, that It
should be possible to frame and adopt
statute applicable to at least all railway
the Interstate commerce law, and which
shall be clear. precise and memorable
upon the following topics:
.sFirst-The regulation Of the election
Of railway officers, SO that such elections
snail be free and open, and represent
directly and fairly the wishes and inter
ests Of security holders
DISQUALIFICATION Of national bureau
of publicity, inspection and control, pro
viding for the regular publication at
stated periods of certified reports. show
nQ fully and accurately the earnings,
expenses. acts of directors and all busl-
aess results which affect the value Of
corporate property.
s.Third-Making each violation Of law
~ an act of u5urpation or wilful mis-
management crime entailing Imprison-
aent and requiring federal prosecution
+ officers to institute aud conduct prose
.utions for such offenses.
Fourth-Providing q thorough revis-
On of the proceedings under which