The Indianapolis journal., 1896-11-25
SPECULATIVE SYNDICATES.
A Host of SwindIing Concerns That
Find Plenty of Victims.
York Letter in Chicago Post.

brokers' running speculative pools ana
''syndicates." are nourishing in New York
now they have never fiourished before.
They number hundreds and possibly thou
sands and the money they take in aggre-
gates big figures-many, many millions a
year Once in Il while the postoffice
th6fities break up nest of syndicate rob-
bers, but cases against them are hard TO
make. and where falls victim to Of
ticial vigilance a hundred keep afloat TO
prey on the greedy and gullible Many of
sthe more dangerous syndicate games are
operated in surface compliance with the
forms of law and the usages of trade. They
are conducted by men who have had prac-
tical experience on exchanges and boards OF
trade or in bucket shops, and their trading
cards and books are seemingly straight and
regular.
The system of running syndicate schemes
has nightly improved since the days of
the old Chicago Fund W. the grandfather
of swindling blind-pool games. The pro-
moters of Fund W. kept no books; they
simply kept the millions that poured in on
them, sent the contributors bogus dividends
out of the principal for a time and when
the end came pocketed the balance. They
never made trade in the commodities in
which they were supposed to be speculat-
ing, and investigation proved them to be
cheap and vulgar thieves and bunko men.
Fund W." although yielding Its man.
ayers 81 100000 or S3 0OO,00O net, and pro bly,
the most successful job of its kind in his
tory, was primitive and crude in the inner
workings, If the Lorings and their asso-
ciateS had known as much as the syndicate
Swindlers OF to-day their 'prOfitS' would
have been ten times great. and they
date, honored and respected members of
society and i-millionaires, instead of
plain millionaires with beclouded records
Coming flushed and triumphant from q
session of an investigating committee. a
Chicago Board of Trade member who had
been charged for the twentieth time with
your bottom dollar on that. My books and
accounts are straight as a string from first
who try to do this sort of thing is that
they fall down when it comes TO the bank
account. My check book and deposits show
for every dollar that goes out and comes
into my office. There are checks to show
for all differences coming and going. and
the banks afford all necessary confirmation
of the correctness of my statements. If
my personal speculative account happens
to show profits and losses to correspond
with those of my customers that is my own
affair. and cannot be brought in as proof
that i bucket shopped' their trades. If
speculate that is my business. and no man
or association of men can legally pry into
my personal operations.
In office bucket-shopping proper there
has been no material Improvement upon
| the plan developed by the Board of Trade
member | have quoted and who has since
retired. / understand; but there have been
variations in the application of the idea to
syndicate bookkeeping and bogus cross
trading to cover up crooked transa ctions
and afford insurance against the recovery
OF moneys stolen or criminal proceedings.
The more cleverly managed of the skin
syndicate concerns i'm Gotham have all the
modern safeguards that ingenuity and ex-
perience can suggest. but hundreds of con-
~ rlrn xxyil and yyit m rarQ
tense of "squareness." They are robbers
rOosts. conducted with all the effrontery
imaginable and with utter disregard Of
even the appearance of genuineness. 1t
would seem that their spurious character
could be detected by the veriest reuben" "
but they continue to plunder and thrive.
Their only paraphernalia is little cheap
speculative literature, some stationery, let
ter heads. forms of account purchase and
sale. etc. The allurements held out to
catch the unwary of all degrees vary
ing with the recklessness and audacity Of
the swindlers, from the ,stereotyped adver-
tisement of the tremendous profits accru-
ing from pooled operations to straight
from-the-shoulder guarantees of regular
dividends of 10. % and even % per cent.
the usual practice, however, to exact an
agreement from the investor that he
must give the syndicate mana cement abso-
lutte control of his money. and not question.
dictate or seek TO inquire into the way il is
being used. The management in undertake
| ing TO successfully engineer syndicate spec
ulationS, must not be embarrassed by sug-
gestions from contributing members. This
bait is very attractive and catches myriads
You win wonder how the syndicate man.
ager gets out of the corner in which he
| cape criminal liability. Ii is easy as roll
inf7 off log. There comes a time when
| the investor wants to know how he stands
| and he writes to inquire how about that?'
| Three months or six months may have
| elapsed without word from the syndicate
! office. The money has been transferred
\ Nf NIstn.
/ to that of the syndicator, but the former
! does not know 1t. He supposcs that the
cash has been doing WONDERFUL and mys-
| gets tired of being wholly in the dark and
| opens up communication with the other end
! of the line The impertinence is resented.
| and he is told that inasmuch as he has
| seen fit to violate his agreement by seeking
! to lift the veil that conceals the sacred OPP
erationS of the syndicate manipulation the
| guarantee provision is hereby abrogated.
| next the contributor hears. If he hears any
| thing is that the syndicate regrets TO say
| that ii has put his money into sugar or
| gas. or cotton, or wheat and lost 1t. That
| closes the incident so far as the angei
| is concerned.
| was merged into the bank account of the
| syndicator, and probably lonS before &c
was put out of misery the money had gone
! into house rent. board bills. grocer..s mea
| or strong drink, for ii costs !, whole lot
| 10 live i'm New York. Occasion the
swindlers are called down and forced 10 10
Way to square "kicks" 1ney wait urtil
the "kickers' present themselves. and
/ when explanations and biufnng tai.. theh
| they restore stolen funds. There nave
been such things as honestly nah1ieo spec-
ulative blind pools" and speculative
| svndicates" but they are nearly - rare
as hens teeth, and it can be accepted as
| incarnate truth that 80 per cent. OF tue
! money that goes into these scnsm"S y sto-
| len outright, and that where there Il !,
pretense of legitimacy the nooAlns anu
trading forms that are observed ''.s Pc ,,,.t,-
! Iv blinds to conceal the robbery and pro-
| tect the robbers from punishment Tor the
| crime. =,
There are some of these nefarious syndi-
| cate concerns in Chicago, but where one
exists there. fifty are to be louho III MN new
| York great many millions OF hard-
| earned fool money is handed over an
nuallv into the keeping OF these wolves
| of the street" and the business mas re-
| Gently assumed the proportions OF an abuse
! that threatens to still further prejudice the
! good name of the Stock Exchange ana
| Chamber of Commerce. for, TO the outsice
world. everything savoring of speculating
| and gambling originating in New York Is
| associated with wall street. and that
| rnuch-misunderstood phrase embraces all
the exchanges. banks and brokers on Man.
| haitian island.
Svndicate swindling is more dangerous
and insidious method Of robbery under the
| cruise of Speculation than bucket shop
| Ming and with the bookkeeping and Office
| machinery to prevent detection and pun
| ishment II is going to be difficult matter
| 10 root Il out The iniqutious business has
| already cut into the volume OF trade legit-
! imately belonging TO reputable houses hav-
| ing accredited standing and many are the
| Dlans that have been discussed in the back
| offices Of the banks and brokerage houses
| to get az the evil. Nothing has yet been