The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-08-08
FRE DEVELOPMENT OF THE
ASPHALT TRUST.

phalt Company of America, more commonly
known as the Asphalt Trust, and the Ques-
tionable, il not illegal. methods by which
! il was organized The stocks of the sub
| sidiary companies were deposited with the
Land Title and Trust Company OF Phila-
delphia, which acted as trustee for the new
company. These stocks represented a
par value Of about sls ,Oo0, 600 and S per
cent gold collateral certificates Of the new
| company to the amount OF 100000 600
were issued in exchange for them,
The Land Title and Trust Company also be-
came the registrar Of the stock $50 900 600
Of the Asphalt company. with the Girard
! Trust Company acting as the transfer
agent. On Aug IS, 1890. this stock was
| placed on the unlisted department of the
! Philadelphia Stock Exchange. In May OF
| 1900 both the stock and the collateral GER
tifcates were regularly listed on the ex-
| change
| A review Of the situation al that time sho VS.
that the promoters OF the asphalt combina-
ton assumed. and assured the public, that
lheir commercial position was impregnahle;
| that they held an absolute monopoly which
would virtually eliminate competition, and
| prices they saw fit 10 make on contracts
! for either private or public work But
their success in converting their holdings
in the subsidiary companies upon a basis
Of three fairly good dollars received in eS-
! change for one lightweight dollar seems
! 10 have pointed out 70 them a more re-
muneratiye means Of livelihood than the
spreading Of kettles Of hot and evil-smell-
ing asphalt on city streets. The interests
! Of the commercial end of their business
suffered neglect as result Of their interest
| in the financial end and in consequence Of
their presumed immunity from any serious
competition
Neither the payment Of the interest on
their certificates nor the payment Of Givi-
dends on their stock out Of earnings on
operations was even remote possibility
Yec the collateral certifcaNe Of the Asphalt
Company Of America sold from 81 10 81
and the stock Of that company, with only
IS paid up on $50 shares, sold a, 1879. On
the strength Of representations made by
those who were connected with the enter
prise, men Of repuce and standing in both
social and financial circles, its securities
were taken up with no little eagernsss by
the investing public. II IL now charged
that deliberate fraud was practised in order
70 give these securities market value. In
its issue Of July II. 1903. the North Amerlcdn
Of Philadelphia SAYS editorially. We do
not purpose TO attempt a description in
adequate terms Of the Asphalt swindle,
It's millions Of stained loot and its uncounted
victims speak for themselves
Among these victims there appears one
Oscar Fro-scher, who, in February, 1900
purchased s. 900 il the collateral IS of The
Asphalt Company Of America. He has
now brought suit for recovery, naming as
defendants Messrs. Sydney F Tyler, f
Burgess Warren, George u. Widener
George W Elkins, James c. Young, William
II Croker, and William ] I-atta. While
not specifically named as defendants. the
names u P A B. Widener, W l.. Elkins
AMI l. Barber and Francis V Greene all
Of whom were well and publicly known as
actively concerned in the enterprise, are
referred 70 in the plaintiffs statement in
such way as 70 make them virtually, If
not actually, parties 10 the suit. Through
his counsel. j. W. NJ Newlin Of Phila-
delphia, Mr.. Frotscher charges The de-
PENDANTS with having circulated false
reports regarding these securities. and
with having been engaged in a conspiracy
20 obtain money by false pretenoes, by put
ting upon the market in Philadelphia for
sale certificates Of the Asphalt
Company Of America
The Municipal Journal end Engineer Of
New York says in ts Issue for April, 1903.
t.g tr-,
fraudulent disrepuIsble and hrariess. fraudulent
because Il practLsed deceit In gaining is hold on
some OF the subsidiary companies and secured
much OF It's capital under false preicnceS disTrpu;.
able. because II has been charged with obtaining
business BY bribery and corruption. which charges
/; has never tried TO rctute; heaItess. because IT
counted for nAugAt the sacrifices and fdrlty o!
the practical men In the business those who had
created and given 10 the asphalt industry Its previ-
oLs homes; Da!ne-ytrtusly casting them adr.fI BIZ
making IL impossible for honest men 70 DO business
according 10 the methods OF the trust tina, these
mrn 1re obliged 20 &c; out or lose their self re.
spect
Upon no other ground than that Of mis-
representation by those in whom the pub
lie placed unlimited confidence is il possible
20 account for the sale of the securities Of
this company and for the avidity with
which they were taken up by both large
and small investors. Stated tersely. the
total yearly earnings Of all The subsidiary
companies forming the so-called trust"
never amounted 10 one-half OF the single
item Of fixed interest charge (sl, 500 OoOD
assumed by tho Asphalt Company of Amer
lea when II began it's business in july
1899 To cover thar SUN. 70 pay all operat-
ing expenses salaries and other fixed
charges, and 10 pay dividends 10 the hold
ers of $50, 600 900 in stocks OF the cornpanv
was an impossibilily which should have
been evident upon the very face Of the
proposition, Yet statements were made
and assurances given by those Interested
which convinced the investing public that
all this was certainty, and the new com
bination was heralded as a second Stand
ard Oil
For time the promoters Of this enter
prise throve nightly Bur in their conf
dence in a monopoly Of the market they
reckoned 700 surely and not wisely A
monopoly in asphalt u only less of a rnssi-
pility than a monopoly in bituminous coal
Richmond entered the field, a Richmond
who would not be killed, and he started in
20 make things interesting for the alleged
monopoly. His name was John " Mack.
This gentleman protested 10 round
up a second bunch Of paving companies
Their standing and importance in the
trade may be Inferred from the facr
thai the original company BAD NOT taken
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