The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-05-27
GOULDS' LOSS WAS $2,5oo,ooo.
TOOK OVER 100000 IN notes.
LOST 100000 on STOCK.
This in Addition to the 81 400. 900 to
Redeem Loans on Virginia Securities
Frank Couid's 81 900 900 Deposit
Went Into 1hem--Fisher's Reply.

Through the Merchants Trust Company
which George F.. Fisher used for his many
promotion schemes, Frank Gould and
Helen Gould have lost t2500. 600. This
may be reduced If they are able to realizoS
anything on the securities they took over,
from the company upon which loans or
81 500 900 had been made to Fishers Virginias
Passenger and Power Company.
There is fight now in the courts betwee n
Fisher and some of his old associates and the.
Goulds, and at present each side has -
receiver for the company, one appointedy,
by the State courts Of Virginia and thoS
other by the Federal Courts.
Fisher, it came out yesterday, was cNQf
Of the original directors Of the company
and is said to have been behind its formas'
ton. He is a Rochester University graduate
and according to dispatches from there
inherited small fortune from his father,
George W. Fisher. While in college Fishert
and Dr. John 7. Mum we're members OF
the same fraternity. Dr. Mum was Q,
member Of the original board of directors.i
OF the trust company, too
The counsel for the trust company when
Fisher got his loan through was the firm OF
futile, Flint 4 Nichols, They are Fishers
personal counsel now. 1t is said they
were instrumental in organizing not only"
the Virginia Passenger and Power Conn.,
pany. but also the Hudson Valley Railway
Company to which the trust company
loaned 100000, and the Rutland Street
Railway Company and the Chittenden
Development Company to which 5000 OOo'
was ,aned.
Just who induced Frank Gould to put his
money into the trust company hasn't come
out yet but it is believed to have been DR..
Mum who had heen taken in by Fisher ~.
The Gouds had been behind plan to ora
ganize Federal Trust Company. but
Frank Gould selected the Merchants' as .
better investment. He subscribed to g
majority Of the stock and paid $500 a share.
He also put 81 900, 900 in, for which he got a
certificate OF deposit. Mr.. Gould found out
some time afterward that his million formed
most Of the loan to the Virginia Passenger
and Power Company.
Mr.. Gould did not become a director
nor did he have any personal representa-.
tive on the board. In the fall Of 1909 he
heard rumors about loans the company
was making and had lawyers look into the
matter. They demanded permission to
examine the trust company's books. This
permission was refused. and the lawyers :
applied to the State Banking Superin.
tendent. Mr.. Kilburn hurried here, found
from the books what had gone on and gave
tho trust company twenty-four hours to
decide whether the company close up
or give Mr.. Gould a chance to protect his
interests.
Mr. Gould up to this time. it Is stated,
had no interest in the Virginia Passenger
and Power Company. He had been, how-
ever, a subscriber to 100000 bonds Of tho
Richmond Passenger and Power Company,
one Of the underlying concerns. Tho
bonds Of this company are said to be WORTH
above par at the present time.
Mr.. Gould found that the million no y,
had deposited had been loaned on the se-
curities of Fishers company. To protect
the money he had already put in the con-
Germ he rot three places on the board OF
directors and had the right to have his
lawyers look into everything that the com-
pany did. As a further condition upon
which the company was to be allowed to
90 on, Fisher and the then counsel for the
company got out.
Investigation showed that the Virginia
Passenger and Power securities had no
market value, and Mr.. Gould came forward
with his sister Helen and offered to take
them off the hands of the company at their
par value and accrued interest. Miss Gould
had Ito interest in the company.
1t has been stated that the Goulds paid
the company 81 400, 900. As matter OF
fact, that represented only the amount OF
the securities held "a collateral. There
were also two notes of the Virginia Pas
senger and Power Company amounting to-
eether to 500, 600, which the Goulds took
up. making 81, 100000.
1t is known that Mr.. Gould soon after
this offered to form syndicate which
should take over the trust company at q
certain figure. guaranteeing protection
to stockholders and depositors. but reserv-
ing the right to bring criminal proceedings
a eanst any of the former management
if justification were found.
The offer was refused by Langdon and
the old directors. They replied with
proposition to pay Frank Gould $500 share
for his stock, an offer he accepted. though
it meant IN additional loss OF $50O,0O0 more.
That ended Mr. Gould's connection with
the company, which had cost him and his
sister more than s., 100000.
There was a race to see who could first
get a receiver appointed for the Virginia
Passen ger and Power Company, the Goulds
getting the Federal receiver and Fisher
and his crowd the State receiver. The
courts in Virginia are still trying to decide
who's who.
Fisher is now engaged in promoting
the New Jersey and Pennsylvania Rail-
road Company, organized to take over
several small steam roads in New Jersey.
Lewis F.. Spencer, Fishers stenographer.
is secretary of the company. 1t was
learned yesterday that Fisher tried to
get the Guardian Trust Company to take
up his Southern Textile Company, another
concern now in receivers hands and in
connection with which he has been indicted.
A plan of reorganization Of the Mer-
chants Trust Company was submitted 10
some Of the lawyers recently, but was re-
jected for the reason 1t was stated. that a
reorganization at the present time was alb
solutely impossible 1t was also stated
that criminal proceedings were almost
certain to be brought shortly. That the
trust company was closed by Supt. kilburn.
after it had been so far put on its feet that
depostors are almost certain to be paid
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