The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1899-11-16
Alleged to Have Realized Over $780,
900 i'm Two Years Through Their
"Bucket-Shopping" Operations.
TRADED WITH THEMSELVES
INSTEAD OF ACTING AS AGENTS, THE
PUsTOFFICE INSPECTOR SAYS.
Warrant for Arrest Based on the
Charges of an Alleged Victim, who
Says He Lost About $4,000.

CHICAGO, Nov. 15.-The federal authori-
ties to-day took cogniZance Of the reports
which had been made concerning the alleged
fraudulent business of the Board of Trade
firm of McLain Brothers & Co., and arrest
ed Charles r. and Albert O. McLain, men,
bers of the firm. The charge was using the
United States mails 20 carry a scheme
to defraud. The prisoners were taken be-
fore United States Commissioner Hum
phrey, where they waived examination on
the charge and were held to the federal
grand jury in bonds of 5000. The bail was
what is known as a joint and several bond,
the whole of which will be forfeited IL either
or both OF the defendants fail to appear in
court when called on. The two Board of
Trade men are said to have begun their
operations with customers in various parts
of the country two years ago. and 1t is
claimed they realized over $4,000 through
their "bucketshopping" scheme. They will
not appear in court again until next spring
and not then unless the federal grand jury
finds true bills on the charges.
The firm of McLain Brothers & Co. has
stopped all operations on the market, hav-
ing transferred its trades The case, which
will be presented before the next grand
jury, is said to show most fragrant viola
tions of the Board of Trade rules as we'll as
offenses against the postal laws. The firm 3
business consisted principally of deals for
country customers. The members of the
firm are said to have matched" buying or
selling orders from customers with the re-
verse trade OH its own account, and the
work is said to have been carried on so
quietly that many customers lost money on
the ficticious sales.
The evidence in the case is in the custody
of the postoffice inspectors, and is made up
of bundle of several hundred letters writ
ten by the defendants to their customers.
Some of these customers were: +. A. Hyke,
Luverne, Mimi; II. M. Lloyd, Sterling,
Kas.; j. j. Stevens. Dalton, Kas.; Hunter
Milling Company, wellington. Kas.; A. G..
Mains. Philadelphia, Ill.
The warrant for the arrest of the McLain
brothers was based on the alleged swindling
of F. A. Hyke, of Luverne. Mimi, who
claims to have lost about $4,000 on his
deals with the Board of Trade firm. The
Board of Trade rules provide that when
sales or purchases are made for customer
the firm must furnish the former with men,
oranda, giving the name of the firm from
which the purchases were made or to which
the commodity was sold as we'll as the
piiCSo ct WLICl tIducS were
The evidence in possession of the postal
officials consists of letters which contain
memoranda of transactions made for GUS
toners and show that while an effort was
made to keep within the letter of the board
rules. conspiracy existed among certain
local firms to violate them. 1t is said these
deals which were made by the McLain
brothers for customers in the West were
hue cLrat at>bn nd
6rain pit.
Postoffice Inspector Mayer said tonight:
1--WE hope to prove that the defendants car
ried on an extensive business through fic-
titious sales, and that they profited in near
ly every case where they made trades for
their correspondents. They engaged in bus-
ness as commission men or agents. and in
making trades for customers they usually
traded only with themselves, thus acting
principals instead of agents, and in do
ing this kind of a business they were in a
position 20 name their own prices, because
the deals were never reported in the pitt