The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-04-18
GIGANTIC SEINDLING SCHEME.
FORMER CONGRESSMAN FROM IN
DIANA At the HEAD
Between Two and Three Million Dollars
Drawn From the CreduiOus Public
Fraud orders Against the UberO
Plantation and the Consolidated UberO
Plantation Company OF Boston.

Plantation company OF hOBOn.
WASHINGTON. April i7.-Wllliam d. Owen,
former member Of Congress from Indiana,
former Secretary OF State Of Indiana and
former minister OF the Gospel, organizer and
promoter Of the Ubero Plantation Company
OF Indiana, the Mexican Cofoe and Rubber
Company OF Indiana, the Ubero Plantation
Company Of Boston and the Consolidated
Ubero Plantation Company, also Of Bos-
ton, has gone TO Europe, and thousands
Of investors in the stocks and bonds Of the
companies are holding the sack. The sack
il empty The facts arc set forth in mem
orandum Of the Attorney General for the
Post Office Department accompanying
fraud order which was issued to-day against
the two Boston concerns.
II is also said that Arthur W. Stedman
and Frederick G. Hood, two men promi-
nent in Boston business and social circles
president and vice-president respectively
Of the Consolidated Ubero Company, are
likewise absent in Europe. Judge [. H.
Wiley Of Indiana, at present Judge Of the
Indiana Appellate Court, Is named as the
treasurer Of this company.
The investigation conducted by the de-
yartment through Inspector Shaw, one Of
the oldest and most experienced Secret
Service men in the Government employ
disclosed one Of the most gigantic and
baldeat frauds that have been perpetrated in
recent yeans. William ID. Owen is said to
have been the prime mover in the enure
swindle and presumably the chief benef-
ciary. Frederick BoTges another Indianan,
was partner in the deal. BorGes, it is re-
ported to the department has record
Tor serving terms in the penltsntiary az
Joliet and at Pittsburg.
How much money was Of tanned from the
CTedulous public by the schemes Of these
men is a matter Of conjecture but Is Is be-
lieved to be- at least one million, and prob
ably two or three million dollars. there
is little prospect Of any satisfaction TO the
investors, a. II is stated at the Office Of the
Attorney General for the Post Office Depart
ment that owen and Borges undoubtedly
received excellent legal advice in forming
their scheme, and il Is q question whether
they can be held In civil OF criminal action.
Borges Is said TO be 30 confident Of securIty
that he has remained IN Boston.
owen embarked in his Mexican plauta-
ton scheme shortly after retiring from
the office Of Secretary Of State in Indiana
IN 1898 He first organized a company
known as the Ubero, in which lnoana
people we're largely interested, which held
out Rlluring promises Of immediate re-
turns on the investment. The transactions
Of that company have mot been Investigated
by the Department, however, the inquiry
being confined 70 the two Boston con-
Germs with which Owen entered upon a
wider spb0re Of activity. He and borges
first organized the Ubero Plantation Com
pany OF Boston and interested prominent
BOstOnians, ..." "a
The proposition was the development Of
a coffee and rubber plantation OF 5000
acres which the company was 70 purchase
from the Louisiana Puerto Company, owen
and BOrges constituting the Louisiana
Puerto Company. The Ubero company
was to pay $4,000 for this land, and evl-
dence SHOWS that more than $500 OOO was
paid TO the Louisiana Puerto Company
but that the Ubero company never became
possessed Of the title to a single acre.
The stock ia the company was put on the
market on the monthly installment plan.
Extensive advertising WAS done and It VAS
represented that the company was making
sufficient money while developing tEe
property to pay dividends Of 10 per cent.
annually. Such dividends we're paid, but
the investigation disclosed that they were
paid from the funds Of the investors and that
there had been practically no development
Of the property, hence no returns war
runting dividends.
appeared at the hearing before the Attorney
General acknowledged that the funds Of
the investors had been fraudulently in
duced, Incorporated and dissipateG, but
said in defence that the directors of the
company as we'll as the investors had been
deceived by Owen. who had had entire
charge of the affairs Of the company and
who since the crash had fed to Europe.
Embodened by their success With this
company, Owen and BOrges nett organized
the Consolidated UbeTo Plantation Com
pmy. issued bonds to the amount Of 81 go
600 and sold both bonds and stocks on
monthly payments. This company was TO
! develop 1000 acres Of Mexican lands which
1 il was to purchase through the Tropical
Sureties Company Owen and Borges again
/ from the Mexican Coffee and Rubber Com
! pany, an Indiana concern. The rubber
I company was capitalized at $50 900 oHly,
/ and the fraudulent character Of the trans
! action Is evidenced by the fact that the
Consolidated company was to pay It 100000
! for property said to be worth not over
| $40. 900 or $50 900.
or the GOO acres Of land ? ,735 are still
/ virgin forest, ,OS7 arc vslueless and only
I 2S5 have been planted, nothing having
resulted from this development. To sell
the bonds and stock, representations were
made and fulfilled that dividends would
accrue Immediately, the names Of promi-
rent men were widely heralded as officers
and directors, and Owen and Borges even
went 30 far as TO put a special brand Of
coffee on the market In special packages,
labelled as the product Of the Consolidated
company. Investors were urged TO use
stheir own coffee" Investigation proved
that not a grain Of coffee had been produced
on the property
In concluding his statement in regard
70 the case, the Assistant Attorney General
says
SThat this scheme was conceived in
iniuuity is clearly apparent from the devel-
opments which have brought the case TO
the attention Of the Department The
plan Of Owen and Borges In both OF these
companies was 20 secure the names OF
prominent men 20 create an appearance q
Stability and then, by aluring literature
and the payment q fraudulent dividends,
to give the scheme the appearance Of a
profitable enterprise. The development
work done at the plantation WA solely for
the purpose Of unloading visiting directors
and investors. All the funds Of the COM
pany, which would Of course have to be
used for the purpose Of purchasing the
land and developing the property, wore d.
verted 10 the pockets u the promoters
! through the medium Of selling compo mics,
who alec undertook 20 develop the Prop
erty. As the properties were not develored
! and not even transferred 10 the other CON-
| panies, investors to-day have nothing 10
/ show for their money
Representatives Of the companies asked
/ that fraud orders he not is9red and prom
, ised TO do everything that could he done
| TO save something for tho inve4tors, but
/ innsmuoh a. large amounts Of money are
3 F,1nTin0 intn tho c,Fp I'd gr,r,, IN