The evening times., 1898-11-26
STOCK BROKERS DUPED
BY A CLEVER SWlNDLE
Cleared More Than 100000 Trad
ing in Eastern Elevator Stock
the New York Exchange.

New York Nov 26-Some interesting
details growing out of the suspension of
H. b. Newcombe and e w. Orvis, two
brokers, of the Stock Exchange. who
were found guilty on Wednesday last Of
having made fictitious quotations in the
stock of the Eastern Elevator Company
of Buffalo, were brought TO light yester-
day, when announcement was also made
that there had been no dealings in that
stock since the governing committee re-
Gently took action in regard to the COM
pany.
The particulars of the transaction go to
show that even the most astute broker
In the Street is not proof against the
wiles of clever swindlers More than
that. it has been shown that the Stock
Exchange itself can be taken in"
In announcing the suspension of the OF
Tending brokers Chairman Mcclure gave
some details of the irregularities which
caused the governors to act so summa-
rily. The stock of the Eastern Elevator
Company was first traded in early in
March last, soon after 1t had been listed
Transactions the first week or two re
65 81. Then the stock declined, and hung
around 81 for several months.
The stock is said to have been float d
by a man who is vaguely spoken of as an
art collector and who X said TO have
had luxurious apartments at one of the
most expensive hotels - this city. HIS
name was withheld. As the story goes
this man was introduced in certain cases
by Mr.. NewcOmbe To other brokers and
opinions still differ as 10 whether or not
Newcombe knew of the gang the art
collector was playing. At any rate the
man opened accounts with some of the
brokers, putting up a twenty per cent
margin.
The next move of the art collector
was TO give his brokers orders for some of
the more active and standard issues Then
he would order purchases of Eastern Ele-
vator stock, and in almost every instance
il was also sold for him by some other
broker acting for him. In time all of the
accounts would be cleared up except
Eastern Elevator stock, which was al
ways left with the brokers on what
seemed a liberal margin.
When weeks passed and no bids came
for Eastern Elevator stock the brokers
holding it began to make inquiries only
to find that the collector had disap-
peared. In no case has the principal le-
turned TO claim his stock. An inytstiga-
! tion was then set on foot by the govern
ors of the exchange, and the suspension
of Newcombe and Orvis followed
Those who pretend to know say that
the collector and his friends disposed
of about $500 shares of the stock at be
tween CO and 65 Allowing for all expen-
ses in playing their game they are
/ credited with having cleared more than
$l00.0o0. The apparent value of the stock
today is about So a share. or little more
than one-third the price paid for it by the
brokers who now hold it. For good rea-
sons the names of the victims. who are
brokers. have not been disclosed.
When application was made for listing
the stock everything seemed regular to
/ the committee having such matters in
charge, but the one important thing
which was overlooked was the absence
of necessary guarantees that the compa-
ny had continued earning power The
capital stock of the company was S1,0O0,-
OO0