The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-08-09
DEAL. In INVESTORS. Names,
A KIND or GRAFT THAT WORRIES
CORPORATION OFFICERS.
Dishonest Uses Made Of Lists or stock.
holders Of bic Concerns Examples
Of Successful Sw lnlilcs-The Trade
In Names Carried DIN IN wall Strccs.

In Names Carried DIN In wall strcss.
An officer of one Of the most powerful
OF the recently organized industrial conlJi-
nations showed the following advertise
ment to Sun reporter last week 80.
LIST Of preferred and common stockholders of
one OF largest trusts listed on exchange: sell lOr
cash or consider proposition. HONEST o. Blank.
an that advertisement, he said "yon
put your finger on the most annoying and
the most mischievous source of worry to
great corporation, outside of, COURSE.
Of its proper business. We can cope with
open and avowed hostility. whether from
competitors or honestly mistaken enemies.
but from these barnaces on the bottom
of our ship, these honest individuals
who revel in darkness, We can look for
| nothing but trouble. ......... ......
IF the mischief were mcdtated against
us we might meet il easily enough; but 10
ia in most cases directed against our stock
holders. For the sake of illustration take
the United States Steel Corporation.
"1s preferred stockholders number nearly
rs 900 and its common $4,000 persons. This
is an army Of investors who dwell in every
city of importance in the country, in many
farms everywhere.
The promoters of fake mining and in-
oustral concerns know well that stock
lists include the. cream Of the investing
public. They 60 over them carefully.
marking of those stockholders who on
account Of proximi,wor avennes of informa-
ton might easily penetrate their designs.
and to the more remote and untutored
they asnde 'rsams of dazzling literature
regarding Investments.
an many, oases the promoters mako
clever analyses Of the earnings of the COM
pany to which the stakeholder belongs
and set forth superficial comparisons in
which the proposed Investment comes
out far ahead All the baseless reports
and rumors Of Wall Street ara welded to-
! gether and put under the eyes Of the worried
| stockholder until at times he is fully per-
suaded to withdraw from his company
and invest in the bubble mining.or oil con-
| Germ.
These tactics are particularly successful
| in a period like the past few months Sc
| curties of all kinds have been declining
on the Stock Exchange, and this alone is a
| cause of anxiety TO nervous investors So
| when they receive a circular detailing the
| decline in their fayorite stock and in the
next paragraph setting forth the golden
| profit s of the sturdy, dividend paying Lucky
| Dollar Gold Nine their confidence is sha ken.
The schemes of the promoters, onca
| they are in possession of list of stock
| holders of big company, are remarkably
| ingenious. In one case that came to my
| notice there was sent out to the stock
| holders of company an apparently official
| circular which stated that the company had
| decided to organize subsidiary company
to manufacture certain articles from the
waste materials or by-products of the
parent company.
| The circular gave the name OF the new
| company, a lmost- word for word that Of
| the old and added hat as less capt. al would
| be needed the shares had BEEN placed at
$40 each 10 put them easily within reach Of
! the old stockhodeSs.e Most of the stock
| hah been taken into the treasury OF the
parent company, SAID the circular, and
subscript ions, with Is per cent. cash, should
=! be quickly sent I o the treasurer of the new
company az an address, as will be noticed
| next door TO the Old company.
y
| The circulars had been sent only to the re-
moter and more bucolc Of the stockholders.
and. Judging from the complaints which
came later, the response was generous
! The scheme was uncovered through the
inquiry of more cautious stockholder.
but the birds had flown, even before sub
| script ions ceased 10 come in. =. r
| an still another case circulars were sent
! out telling the stockholders that the de
rect OTIS of the company had authorized the
! issue OF additional stock which had been
previously aut horized by the stockholders.
| The amount OF new stock to which each
stakeholder might subscribe and the terms.
part cash and part installments, were set
! forth in full
Enclosed in the same envelope was a
! daintiv engraved card inviting the re-
cipent to visit and inspect the company Q
new Offices in a certain world-beating sky
scraper The stockholders, or some Of
! them, didn't visit the new Offices, but they
sent to Them with their best wishes, sub"
script ions and cash.
$50 YOU see concluded the officer, we
have our hands fuller than most people
suspect We areused 10 the tactics Of stock
! manipulators VINO send our stockholders
| living letters to induce them o throw enough
| stock into the market TO break it's price.
! That's an old and ravorite trick and worriea
| us little
! But when Though the Use of the COM
| pany's name, or it's Isis. our ST holders
| are induced 10 make foolish Investments We
feel ourselves somewhat TO blame. Whila,
| N t,rkbodIar hSs n karfpCf RI . hN