The Anaconda standard., 1895-03-27
IN UNCLE SANS COURT
Mr.. Haupt'S Little BOnanzl Is Said TO
&. Be a Fraud.
PROMINENT PEOPLE TESTIFY
The Governor One Of the Incorpor-
ators-All the Reputable Men
Have Since Drawn Out
of the Scheme.


charge of using the United States mails
Tor unlawful purposes, was resumed in
the United States court this morning.
Col. Harry {. Kessler was the first wit.
ness on the stand. lie was one of tho in
corporators of Haupt's company and tes-
titled that Haupt induced him to go into
the enterprise on the representation that
the company was to be n general mining
and development company. Mr.. kessler
told Haupt that he had no money TO in
vest in such an enterprise and Haupt re-
piled that his mining claims were located
IN the same vicinity as some in which tho
witness was interested, and said that tho
development of the company's property
would benefit the property of Mr.. Kessler
and through this representation he was
induced TO sign the articles of agreement.
MIR. hessler said he never owned any
stock IN the concern and never took my
part in the business of the company. He
said he had always bad implicit conf
dence in Haupt.
ii. g. Walton, another of the incorpora-
tors, testified that he was induced to sig n
the articles of incorporation by General
{. S. Warren, who gave him to under
stand that the company was a regular
mining and development company.
John Gillie, mineral land surveyor,
was the next witness, and testified that
he Hal uliue an examination OF the al
legged mining claims owned by Haupt's
company.
Mr.. Welcome objected to the testimony
on the ground that the value of the prop
erty made no difference. and did not go
to show that the Sl2,OC0,00O capitalization
of the company was fraudulent. Mr..
welcome said the term paid up capital"
meant nothing more than that the stock
was worcestershire.
Judge Knowles overruled the objection
and said 1t was proper to show whether
such a capitalization was intended as a
deception and frand or not.
The witness, continuing his testimony /,
said he had gone over large tract of
country where Haupt's claims are alleged
to be located, but could find no stakes or
markings except on two, the Silver
Glance and Iron Clad. Both of these
contained what would be termed valuable
leads and had improvements on them
that cost probably 500 each. There was
no development on any other claim in
that neighborhood. Mr.. Gilie said the
cash value of any claim in that part of
the country would not exceed 500. though
some owners might hold them as high as
$1,000.
On cross-examination by Mr.. Haldorn
the witness said he would not swear that
the ore in the shafts of the two claims
mentioned would not go $1,000 a ton. BY
his questions Mr.. Haldorn tried to estab-
lish a value for Haupt's claims by bring
ing out the fact that the Black Rock, Nj
agara and other mines, three and four
miles away, we're rich producers. Mr..
Gillie said that If, as intImated by Mr..
Haldorn. six of Haupt's claims adjoinel
the Jay-Eye-See, it would enhance their
value without regard to any development
on them.
What would you say, as business
propositions" asked Mr.. Shelton, "of a
company that would capitalize itself for
N nd faE nlo -,
ment of that amount of stock?'
An objection to the question was sus-
tanned and Mr.. GiHie was excused.
w. IL. Young was the next witness. He
testified that he accompanied Mr.. GillIe
in making the examination of Haupt's
"mines." The witness said the total i'm
provements would not have cost more
than 800.
"What would you say as to the market
value of any lode claims in that vicinity? 2"
II don't think there is n man IN the
state who would give anything for them"
Mr.. Young said lie made an examina-
tion OF the ground IN September. 1893. nd
as the claims were located in 1891 it was
barely possible that the stakes and loca-
tion notices might have been removed
during that time.
Pat A. Largey, another ,of the incorpo-
rators of the Montana Mining, Loan &
Investment company, testified that Hlupt
informed him that the company was to be
a general mining, loan and investment
company. The witness was induced TO
sign the articles of incorporation by c. ).
Warren and Mr.. Haupt, but he never
owned any stock in the company.
Thomas j. Flavin, assistant postmaster,
was called and testified that tho Butte
Office had been instructed by the post
master general not TO deliver money or
ders or registered letters to Haupt. The
testimony was objected to and during the
arguments the fact was again brought out
that the Butte Daily Miner had published
a fraudulent dispatch from an
alleged corresponding at Wash
ington to tho effect that the
law against Haupt's scheme and had prac-
tIcally admitted that the concern was all.
right This fake telegram was printed
in Haupts circulars and Mr.. Shelton said
lie wanted to prove that il was further
attempt at fraud on the part of Haunt. for
at the very time the dispatch was pub
lished there was a fraud order' in the
postofilce forbidding the delivery of mail
10 Haupi.
The court overruled the objection and
the witness produced the "fNud ORDER"
which was read to the Jury. Ii stated that
knowledge came 20 the postoflice depart-
ment that Haupt was engaged IN conduct
ing "A scheme for obtaining money under
false pretenses and deception. and the
Butte postmaster was forbidden to pay
any money OFuerS 10 hauDt OF deliver
registered letters TO him. and instructing
him TO return all such letters to the send
ers stamped with the word fraudulent"
NJ. B. Brownlee of Hoge. Brownlec &
Co.'s bank, was damaging witness for
the defendant. By some arrangement uE-
known TO Mr.. Brownlce, Haupt secured
permission TO use the bank as reference
and printed the namo of the bank on his
tickets and circulars. When Mr.. Brown
lee learned of the true character of
Haupt's scheme he and other bankers
went to Haupt and protested against the
use of his banks name, and Haupt said
he had seen Mr.. Hoge, but would take the
name off as soon as he could get new sta
tionery printed. Mr.. Brownlee asked him
how he made loans" whether by lot or
otherwise, and Haupt said he went over
the list himself and made the "loans" by
pick ing out names on the list.
EN-Postmaster j. G.. Evans testified that
he was in office al the time Haupt mailed
the objectionable matter complained Of
He SAID he received the fraud order