Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1902-07-22
CHAIN LETTER FRAUDS
The Government Investigating a
Number OF Suspicious Look.
ing Deals.
The Home Work" Advertise.
ment and How 1t Is Used
for Profit.
Enormous Number OF Fountain
Pens Disposed OF by the
Scheme.
special to Times Republican.

Special to Times Republican.
Washington, July 2aa.-The postoffice
department is just at present maklns
hard Shedding for 4 multitude of con-
Germs in all parts of the country, althe
snrincipaIly in the east operating what
pre- departmentally known as cham
letter schemes.
The scheme usually appears in the
tisement offering home work. From -
10 SO weekly are assured those who are
willing to work a little while each day
mr. evenings. No canvassing. When
replies are received a printed circular
letter is sent by the concern informing
the applicant that upon receipt OF sou
solid gold fountain pen Will be sent.
The applicant is offered 50 per week 10
write ten letters per DAY TO parties
whose names will be furnished by the
company. or the agent himself may Sc
Lee, the names One dollar and fifty
gents additional to cover cost of post
age, etc. is also guaranteed.
The salary is not to begin for one
week. but the $3.50 will be allowed for
The first weeks postage, etc. The letter
which the agent is to write and mail to
ten persons each day is as follows:
Dear Friend: Enclosed find an
agreement ana offer from -- "
Co. If you take advantage of this ofler
YOU must sign this agreement and send
$50 for the pen. They will then sign
this and return 10 you with names and
addresses OF people. You must write
ten letters every day TO people whose
addresses you know or to those fur
uisfed by the company. You must en-
close ore circular and agreement in
each letter YOU write. All letters you
write must be copied from this letter
word for word from beginning to end.
ALWAYS sign your name and address
when you copy this, and return this
letter to the company. They will furnish
you with q number YOU must always
sign after your name.
On the face of these circulars 1t will
be seen that the plan of business be-
longs to the so-called "chain-scheme,
and that after the promoter has started
It, it is impossible for him to discon-
tinue without breaking the promises
which he has thus given. pen and
work at So per week, in addition to
s1.50 per week for postage. etc.. are
promised, the salary to begin at the end
of the first week. The consideration
therefor is $3.50, which is paid by pat
rons of the scheme before the work will
be sent. BY this system at least two
weeks work must be given each patron
of the scheme to fulfill the promise
made; an expense of IS. The income
from this patron is but $3.50. The
whole scheme resolves itself into this
propositions: For a consideration of
$3.50 and the writing of 100 advertising
letters -- & Co. promise to give
ren and SIS. an impossible proposition.
inasniuch as the letters all hold out
similar promises and if returns are re-
ceivcd therefrom it means other prom
Uses similar to the above for the small
consideration named. The only gain the
company receives either from theo-
retital or other standpoint, as shown by
the explanations of attorneys who have
undertaken to defend the companies,
are from persons who are expected to
ray $3.50 for the nen and the Work and
subsequently decline to work. This is
unreasonable inasmuch as the main in
ducement is work--not the pen.
To cite specific case. company was
tailed upon to make showing and the
Investigation revealed that it was es-
tablished about Feb. ! last and had
been doing business actually but nine
weeks during which time it delivered
nbout 10000 pens. failing to fill many
orders by reason of an inability to get
pens from the makers. The time was
too short to test the outcome of the
scheme. but was long enough to show
that the company received about S4S,-
600. while it had agreed to pay over
Si52, 900.
Admitting the statement of the COM
panys attorney 10 be true that it in
tended to make payment to this extent
(assunling that each customer had in
VOWED the company in d debt of SIS, and
that the number of customers was one
person for each ten, OF 10000 it is APP
parent that the loss of the company
would have been about 100000.
The attorney for the company said ii
was expected the profits would come
Irom lapses: failure o. agents to call for
work. a rather Improbable hypothesis
in view of the fact that work is the sole
object for which a reply to the adver-
tisement is made.
The postoffice department takes the
view that business which proceeds
upon the theory suggested is conceived
in iniquity and sure to defraud in the
end. This scheme once started would
continue indefinitely, or as long as
printed matter held out, and as agents
were instructed to send letters to any
addresses they might have, no one could
tell when the company would cease to
be called upon to make good its
promise.
1t is almost inconceivable that people
IF intelligence in any considerable num-
Der could be gulled by a proposition SO
gauZy, and yet in two months one con-
Germ took in 10000 such people and the
department is swamped with similar
rases 1t would seem to be as plain as
daylight that with nothing involved but
n pen and work, and the work simply
getting other people to work for which
$3.50 more than received was promised
to every new buyer, that the more
ngents and writer's the company Sc
cured the more money it would lose.
The department has become very
watchful of these schemes and scans
the Small advertisements in the news
papers closely with a view to getting
evidence against new schemers. The
department takes the ground that even
If people can not see the gold brick the
government officials can and will pro-