Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1902-12-24


alone that they offer to make loans to
those wishing to purchase homes, Civ
ing them twenty years or less in
which to pay it back without interest,"
and that they show q contract which.
upon its face, provides for no such
| charge. makes the offer so tempting
| that the uniformed are sure TO try it.
The statement is made so plausible
as to induce many to believe that they
have at last found a way in which
to borrow money without paying in
terest charges.
What then, would have been tha
possibilities of these associations in
this State, had they not been restricted
by law? To illustrate. The Granite
State Provident Association, which
operated here some years ago, did not
hold out so attractive a proposition TO
| its members as do these associations
1t was conducted more nearly upon
business principles and Acou1d not,
therefore, make such extraordinary
offers as are made by them. When the
license Of this association to DO bust
ness here was revoked, it mad approxi-
nlateiy $500 members in this State. 1t
Is certain that all of these associations
could very soon have obtained at least
as many members as did that one alone
Again, during the short time they con
Quoted business in this State, they es-
tablished or arranged for some ten on
fifteen agencies, within the knowledge
OF this department. Had there been
no provision of statute restricting their
business, it is safe to estimate that they
would. have established as many as 30
agencies before this. With active
agents receiving an average of $500
upon each application. and SO per cent.
Of the monthly collections on account
of the expense fund, there can be no
dCuot that each of these agencies would
soon have averaged over one hundred
members. 1t is evident, therefore, that
our first estimate of $500 members as
the possible extension of the business I
of these associations in the State, had J
they been allowed to continue business !
here. is extremely low.
With this number of members and an |
average subscription of S3O0O-our
previous illustfation,-what would be |
the results OF such a business? The !
original fees to agents would amour. :
to $3l50o. The contributions to the |
expense fund would be $3.50 monthly, |
or $4,000 annually. The amount col
lected from members would be $57. $50 4
monthly. or $685. 900 annually. The to- !,
tai amount collected from $500 members l
during the term of their contracts 1
would be approximately sl1 $4,000 We
get substantially the same result if We
$4,000. by $500, the estimated /
This gives us $40, 500 0o0. \
. he .latn1t If l.a
If we add to this $1,OS1.-
500. we get substantially the same
total as before, this latter amount be-
ing the collections on account of MEM
bership fees and the expense fund II
mus We have, even without any lapses
to swell the profits n million dollar
scheme for the promoters. These es-
Inmates may seem extravaganza We do
not contend that any such results could /
have been obtained. a. without doubt
the associations would have fallen to
pieces OF their own weight long before
reaching this point. But even in case
OF such an ending greater loss would
nave resulted to the people of the State
and greater pi offs to the promoters.
than if their schemes could nave baen
fully carried cut.
The following statement was furnished
his department by one of these associa.
lions. as an exhibit of its financial stand
ing. and was the basis upon which IL
asked a license to transact business in
his State:
EXHIBIT.
Balance sheet made up to October s, 1862
LIABILITIES.
TO capital
'ornmnn or IA l,c
ness and goodwill. ........... S. 900 90 (.
common stock moi vet |
!. !: :: :: !:
issued .....................S1O0 900 90
Preferred stock
issued ........... $500 90
Less not Yet paid
in ..................19 100 % so CO
Preferred stock not yet