The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-07-26
BUILT TOWN ON STEALINGS.
IA BOyNTIE SH0WED GENIUS IN
!, REAL ESTATE DEALS.
A Clerk on $S3.sO Month. Tie stole
H . working Capital Of S3OO.OOO In
Less Than Year Tho Firm That
Employed Him likely TO Make
100000 Out OF Ills SpeculntiOns.

100000 Out OF HIS speculations.
i BUFFALO, July 25.--Frank " LaBountie,
the clerk who in ten months conveyed to
himself and to fictitious persons $500, 600
of the property OF his employers clients,
which he used in large real estate specula-
Dione, has not been arrested and no order
Tor his arrest has been asked. He is work
ing with the lawyers in Strengthening out
the tangle, and it is believed that promise
of immunity was made to him II he would
do this. r
LABountie's methods were unusual and
were so long successful because his EN-
ployers put absolute trust in him. although
they paid him only So so a month. Wilson
n SnxftA IS she name OF law firm which
handles a number Of estates worth probably
more than S3,0OO,OOO. The real owners Of
this sum have left to Smith 4 Wilson the
whole work Of collecting their revenues,
lending the money on mortgages and in
yesting earnings as they saw fit.
Mr.. Smith is the son Of the late James
NJ. Smith, former Judge, who was him
self a man of great wealth and had great
number Of clients who preferred not to he
bothered with the details Of management.
LaReuptie eame to the firm especially well
recommended, numbering among his Gre
dentials strong letter from bank cashier.
Before employing him, Wilson & Smith
looked him UP. They found he never
drank smoked or gambled, but was a
glutton for work.
While he was at school he had occupied
his leisure hours with small schemes for
Wilson o Smith
took him he got pie ce as instructor in
night school, which increased his income
little and satisfied his love of work
Is Such willing worker found plenty to
do in an Office so busy as Wilson & Smiths.
He seemed to delight in fourteen hours
day at work, and the firm let him enjoy him.
self in this fashion without stint Soon
he was familiar with all the estates they
handled, with the location and value of the
properties, the encumbrances they carried
and their earning values.
" His first theft consisted in conveying
piecs of property, owned by client of the
firm, to a fictitious person. Then he Dor"
rowed money for this mythical buyer by
issuing a mortgage on the land. That
occurred last September. Aft ward. in
the'coufse OF the ten months that followed,
he conveyed sixteen other pieces of prop
erty from the firms clients to persons who
did not exist.
With the money raised by mortgages
on these places, LaBountie went on with his
real estate specularions. He started
suburb called Elmerton, which has for its
principal industry furniture factory.
He put his brother-in-law in charge of the
American Cabinet Company and made him
believe that the money for the plant and its
operations was being furnished by Eastern
capitalists; ,.. ~.
brother-in-law was ignorant of the fraud.
The American Cabinet Company now en-
pleys $50 men. 1t turns out carload of
furniture day and is making money.
Around it is built town of 1875 houses,
and in these LaBountie, through the hold
ings OF persons OF his own invention, was
largely Interested.
! 1t was necessary that LaBountie should
have an Eastern capitalist who would have
financial rating. so he made one 1t
ehanced one day that the stenographer's
salary was due. She was to receive SIS,
so member of the firm signed check in
blank and told LaBountie to fill it out for
what was due her. LaBountie paid the girl
SIS in cash out of his own pocket and Allied
the cneck out for $4,000 He made il
payable to Walter o. Putnam, who does not
exist, and deposited it in the bank, opening
an account for Mr.. Putnam and explaining
khat Mr.. Putnam was a capitalist for whom
he was investing some money.
\ This deposit in the bank was allowed to
stand for some time and others were made
from time to time when LaBountie came
into the possession of money that belonged
b, his employers or their clients. Persons
who called to pay interest due on mortgages
got the receipts of Wilson Smith for the
money; LaBountie put il in Putnams bank
account.
Then when he sought credit in any Of his
speculations he said he was the agent Of
Mr.. Putnam and exhibited the bank book
as evidence OF his financial standing He
invited inquirers to ascertain at the bank
what Mr. P,ltnan's rating was there. and
II they did SO they learned that Mr. Putnam
generally carried balance OF $4,000 or
thereabouts.
When interest fell due on the bogus mort
cages that he had sold he always paid il
promptly for his fictitious principals. In
order to disguise one piece of property
which he had transferred from it's real
owners to some of his myths, he cut it up.
This property was on the corner of two
streets and was on the record maps as
facing the principal of these. LaBountie
cut it up and made three parcels Of it..
facing ON the other street. and by two con-
vepafces almost lost the original property,
He manipulated the accounts Of Wilson
K Smith SO that everything seemed right
on the surface, but kept another set OF
books in which record of his maripula-
TORS was made so that he might not go
arniss through faulty reckoning Of mem
orv.
OF course, LaBountie never took vaca-
tion, for in such an interim something
might come up to uncover his schemes,
and his employers grew I'd love him more
and more for his devotion to work and to
their interests. Not a block away some
years before BufTalo's greatest bank wrecker
had worked in the same way. When the
late Edward $. Dam was stealing s370,000
from the bank of which he was cashier he
did not take day off for thirty years. He
had to be ON hand to keep the books cooked
and when his thefts were discovered the
whole sum was gone, spent in maintaining
salary was wholly inadequate.
The detection of LaBountie came about
when record was made of mortgage
given on the property OF charitable in
stitution to n savings bank. The institu-
ton was one Of the clients of the firm. A
man who read of the mortgage knew that
another bank held IL mortgage on this piece
ri property for exactly the Same sum,
s25, 900, and he wondered If the first one
Rad been taken up by the second bank
An inquiry was made and IL was discovered
that the second bank was entirely in igno-
rance of the first mortgage.
Then came the discovery and La Bountie
made complete confession TO his en-
rleyers. Naturally, their first impulse was