New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1897-04-29
c. NEUKIRCH EXPELLED.
UNANIMOUSLY OUSTED BY THE STOCK
EXCHANGE GOVERNORS.
FOUND GUILTY OF. FRAUD IN HAVING PROCURED
FALSE AND FRAUDULENT REPORTS OF Fic-
TITIoUs TRANshCTIoNs'-THE BOARD
MEMBER OF THEODORE W.

MEMBER OF THEODORE W
M1fRs CO.
The Governing Committee OF the NewYork
Stock Exchange at the close Of a session lasting
from $3.50 o'clock yesterday afternoon till in the
evening. voted unanimously to expe from the
Exchange Charles Ncukirch, Of the finn of Theo-
dore w. Myers & Co., No 81 Newest Mr.. Neu
krch found guilty Of fraud in having pro
cured false and fraudulent reports Of fictitious
/ transactions"
The alleged offence was committed by TheO-
dore w. Myers & Co. as a firm. but 1t was with
! Mr.. Neukirch the partner who MEM
Der OF the Exchange that the Governing Com
mttee Of the Exchange had to deal. The firm is
| composed Of MIR. Neukrch and Edward H.
Myers. the latter OF whom does not belong TO
the Exchange. The firm was established by
| Theodore w. Myers. formerly Controller Of the
city of New-York but he retired from it on May
l, 1S95. Edward H. Myers who is his nephew.
and Mr.. Neukirch continued the business under
the old name.
The charge against Myers & Co upon which
| Mr.. Neukirch expelled was based their
relations with the Il. S. Dean Company, the dis
cretionary order" concern which recently col
lapsed. but there were other charges against the
| firm. 1t asserted that an arrangement ex-
|
pany by which the latter able to swindle its
| customers. The customers Of the Dean COM
pany sent money to 1t for 1t to place In the stock
market according TO the judgment Of the man.
ager Of the concern. No account was rendered
| to customers until trades closed.
| The evidence presented to the Governing Com
| mittee Of the Stock Exchange was that the Dean
company placed Crossed" orders with Myers
e. Co The Dean company for instance. would
| instruct Myers e. Co. to buy 100 shares of stock
at certain price and sell 100 shares OF the
same stock at the price. Thus there
was no need for an actual transaction. for
one order balanced the other. Myers &
! Co. were instructed to furnish separate
report on each order In this way. il the
stock went up the Dean company might
say 10 Its customer that II had gone short Of the
stock, whereas If the stock went down it might
say it had gone long. In either the GUS
toner placed in the position of having sus-
tanned loss the amount Of which could be ap-
propriated out Of the customers money by the
! Dean company.
THE METHOD OF OPERATION.
! II the customer was disposed to question the
| truthfulness Of the account rendered to him by
! the Dean Company and TO make trouble the
| Dean Company could produce reports from My
ers Co. to confirm their account 1t was
necessary for Myers & Co. to be prepared to
| show that they had executed the order. The
evidence before the Stock Exchange was that
Myers & Co.. or rather Mr.. Neukirch their Ex-
change member would say to a broker on the
| Exchange that they had sold one hundred shares
Of stock naming the price. and that they would
transfer the transaction to him (the broker), who
was to report that he had sold the stock to My
ers e. Co The ostensibie reason was that il was
desired to up the transaction. The regu-
lar commission would be paid 10 the broker. To
another broker Mr.. Neukirch would say that
Myers e. Co. had bought the stock Cat the price
named to the other broker). and that they would
transfer the transaction to him. who to
port that he had bought the stock from Myers
& Co. The regular commission would also be
paid to this broker.
The brokers thus employed would each be
| paid 81 on 100 shares. which is the regular COM
mission when one broker executes an order for
| another and does not clear the stock When
| the stock is cleared the charge is SO l2ia
| the brokers put IL. three and a shilling" The
| commission charged by a broker TO person not
| member of the Exchange is one-eighth of
| per cent or ST. - on 100 shares There was no
| effort to ascertain. in the investigation by the
| Governing Committee OF the Exchange. whether
Myers e. Co. received from the Dean Company
| the commission or One-t1SDtu OF l per cent, OF
| participated in the proceeds of the dealings OF
| Dean & Co. The question before the committee
was whether Myers & Co. had made bogus
| transactions The brokers with whom they had
| arranged to report sales and purchases that had
never been made We're present and testified to
| their relations with Myers & Co. There were In
/ timations that some of these brokers had not
| acted in good faith but were aware Of Myers &
CO.'S methods. and that these brokers would be
disciplined by the Governing Committee. The
| exclamation bv Mr. NeukrCh and Mr.. Myers
hat he trancactfOus in question
resented the transfer OF an account.
r. w. MYERS NOT \ MEMBER.
Theodore w Myers had previously explained
to the Committee on Commissions Of the Ex-
change that he had no interest in the firm. lie
sold the goodwill OF the firm and the right TO
use his name to f. H. Myers and Mr. Neukirch
for SJ0OOo payable by instalmentS In three
wears They still owed him S16.OW) on this con-
tract His son is cashier for the firm Theodore
w. Myers. who has been member of the Stock
Exchange sine, April ], 1910 was on May ~
1856 SUSPENDED from the Exchange Tor one
month for violating the commission laws. lie is
president Of the recently organized COLONIAL
Trust Company. which Is to have IT'S quarters
in the new st. Paul Building. on the site OF the
old Herald building. at broadway ana Anh-st'
Mr. Neukirch Joined the stock EXcnanse
March q. 1879. on March q. lssG' exactly seven
wears later. while member OF the nrm OF Leo
mold Calm & Co, he was suspended Tor one Year
for cutting commissions. His partners Mr.
Calm and Jules 5. Bache. were at ne same tiiiie
suspended for the same period. Inc committee
an Admission, Of The Exchange will dispose OF
the seat Of Mr.. Neukirch. and turn over to nm
the proceeds. less any amounts that may ne que
to members Of the Exchange on transactions
on the Exchange. , -,
Refore the opening of business to-day the tele-
rho,ic onrertion between the Exchange and
Nyers q 90 < Office will he severed and the
ticker placed in Myers Co.'S office 10y the New
York Quotation Company whcn COMPANY -
coptrolIed bv the Exchange, Will he removed
ON the opening Of the Exchange Mr.. Neuklrchs
exnulson will be announced from the rostrum.
nnrn,,ted n enter into a copartnership with MT
Neukirch or T. H. Myers ,
In forty years only four members or the STOCK
rxnbanpe have been expelled. They have been
Wuliam J. Hutchinson. John T. Manning Will