New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-08-27
SUIT FOR A MILLION.
RECEIVER FOR COMP1NY.
McCauley Denies Charges of Inter
national Mercantile officers.

Not only has the International Mercantile
Agency. at No. 346 Broadway. now been placed
in the hands of a receiver and is declared in the
petition to be insolvent but the company has
brought a suit in equity against Thomas y. Nc
Cauley, former president, preferring charges,
including one of unlawful conversion of stock TO
his use. against him. Assistant District
Attorney Garvan began yesterday an investisa-
tion into allegations made in the complaint,
which was filed in the United States Circuit
Court Thursday.
In substance the complaint alleges that ST.
100000 of the capital stock of the company was
voted to McCauley on relatively worthless assets
furnished by him; that he unlawfully converted
certain stock to his own use, and that the COM
pany is in its present condition because he be-
trayed his trust.
The papers and books of the company have
been turned over to Mr.. Garvan.
The complaint filed says that the company
organized in January. 1902 as the Sprague
Mercantile Agency with a capital stock Of s..
100000 $1.JO0O00 in common and 100000 in
preferred stock. In May 1908, the capital stock
was raised TO S30O0OO0, the additional 81 1O00
600 being in common stock. McCauley. it is
serted. turned over to the company the assets
and rights of the Mutual Mercantile Agency.
and certain interests and rights in other COM
panies known as the Sprasue Mercantile Sys-
TEN. including the Sprague Mercantile Agency
of Montreal and the Sprague Mercantile Agency
OF Toronto II is charged that the rights in the
Mutual Mercantile Agency were purchased by
McCauley for $4,000. 1t is further alleged
that the transfer of the stock was fraudulent
and void because the board of directors were
dummies and creatures of McCauey.' The list
of the directors is given as William A Conway,
Ross NJ. Turner. Harry J. Jones. Kenneth ].
rI. Y nd = d.
den. 1t is alleged that most of these men were
clerks in the employ of the company and were
not otherwise interested, with the exception Of
Turner. who had six shares of the stock that
had been given to him by McCauley-
OF the stock turned over to McCauley, 1t IS
declare $500000 was turned over in February
1902; S 0000 in March and the balance before
July &C that year.
''McCauley lent money to the company osten-
sibIy from his private fund the complaint con-
tinues. but in reality from the proceeds of the
stock sold by him and represented by him to be
treasury stock"
The officers of the company interested IN the
suit against Mr. McCauley Mr. Holmes.
William II. Sterling. the treasurer. and Charles
\ Henderson, the third vice-presidenJ and gen
eral manager.
Through his attorney. Arthur J. Baldwin. of
Griggs. Baldwin & Baldwin. Mr.. McCauley last
evening declared that the charges were without
foundation.
Mr. McCauley," said Mr.. Baldwin. when ne
organized the company. put in the entire assets
of the Mutual Mercantile Agency, which he
bought up. as well the assets II seven or
eight other agencies Of similar character
These assets he valued at $1.aO0UNO and I as
sert they could not he duplicated for that sum
In return for this, the directors turned over TO
him $1.20O.OO0 in common stock of the new
company.
In the petition for the appointment Of re-
ceiver the ccmpany's liabilities are fixed at some
S21G0pO ana the assets at not more than SloO-
on consisting of outstanding contracts with
subscribers and the various branch offices in the
United States and Canada.
ON Thursday at his home at SeabVight y. J..
Vice Chancellor Garrison appointed George +.
Beach. of jersey city. receiver for the ager~s
on application OF John Enright. of Jersey City,
on behalf of stockholders on Wednesday q
warrant of attachment for S54.22o 80 against
the company granted i'm the Supreme Court
here the complainant being McCauley, who de
cares the sum is the balance OF S41699l Il.
y,l b, lIl bp lent he