Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-08-24
THE SAGE&CO. FAILURE
FORMER GOTHAM POLICY MAN A
BIG LosER-sPLIT A MILLION.


dethroned king Of policy" has been strip
ped Of hundreds Of thousands Of dollars
by the collapse of the most elaborate sys-
tenn OF low finance ever organized in the
United States, M. ]. Sage & Co.
Statements by his son that the man whom
Capt F. Norton Goddard sent to Sing Sing
was not connected with the firm which
last Wednesday went to pieces In New
York city are regarded as bubbles. Every
circumstance indicates that he who fur.
nished the gearing for the chain Of bucket
shops which scooped up the cash Of thou
sands of customers was none other than
Albert ]. Adams, 81.
Those who are acquainted with the intri-
cac:es OF the situation believe that before
he declined to advance more money he was
heavy loser. 1t may be that he has drop
ped half million or a million in the de-
vious ways OF finance with which he was
not entirely familiar.
Whether he directly capitalized the sys-
tenn which Is said to have turned upon him
or gave the money through his favorite
found lately no sure things in following
the vagaries of the stock market.
hybrid Of Finance.
Lawyers, an assignee and bonding COM
pany spent most Of the day behind closed
doors studying the wreck and various
stories are afloat as to just what part of
the machinery was at fault. The system"
known as M. ]. Sage & Co. was a strange
hybrid of fnance-half bucket shop and
NAH policy game-and ITS motive power was
Adams money. Hitherto bucket shops
nave been conducted from a main office,
with branches in various cities, over which
resident manager presided M. J. Sage
q Co. was comprised of 165 loosely affiliat-
60 houses called correspondents. The main
office underworld their bets and backed
a
and In some cases they used the subtitle
CORRESPONDENTS of M. J. Sage & Co..
In the old policy days, when Adams was
king and out Of Jail, the small cigar dealers
who desired to have a part of the game
made arrangements with the head Office,
In 9th street, and twice a day sent in his
runners run, At the end of the day he settled
with the king" The houses which were
connected with M. ]. Sage & Co. mailed
their sheets to the firms clearing house,
NO. Montgomery street. Jersey City.
deposited it in local bank subject to
draft Instead OF runners. the firm had
thousands of miles of leased wires, form
ing the most extensive network of the kind
IN the ne United States except one. and cost
ing $SO.OOO year.
It dealt with 25,OOO customers through
!eo centers scattered from Jersey City as
far west as Cleveland. The transactions
on paper were seldom less than 500 600
daily, while every day there were handled
fully 5000 shares. The sheets of the main
office carried continuously 10000 shares.
Harder Than Policy.
Bucket shop finance is an intricate thing,
and policy Is comparatively simple for
one may arrange the numbers without re-
gard to the actions Of bulls and bears. In
order to handle the system ZAP Adams
found It necessary to use men who he
thought could manage as he did the hire
ilngs who kept sheet and ran his errands
IN the game which brought him fortune.
Overtures had been made to him when
he was still in prison by some of the men
who have since become members of the
firm Of M. ]. Sage & Co. They contributed
the experience and he the money He lost
million or two and got most Of 1t back,
but for the last few months the firm, ac-
cording to its sheets, has been falling be-
hind, and Adams expressed dissatisfaction
and paid out his cash to meet the losses
on transactions shown by wire.
Then came the sensational rise In Union
Pacific and the general soaring of stocks,
and the assignee says that in the three
days before the failure the firm of M ].
Sage Co. paid out $500. OOO to its custom
ers. Whether these are exact figures and
Wall street is sceptical on the subject, there
can be no question that the losses were
extensive.
Adams expressed his displeasure with the
conduct Of the business, and the wires
throbbed with many angry messages. He
had received information which led him to
feel he had been mistaken in his estimate
of the men he had put in charge of the
concern. The demand made last Tuesday
that he contribute $4,000 brought from
Mexico the telegram. viii not give an
other cent-assign'
Forced Firms Suspension.
His son and M. ]. Sage, the reputed
head of the house, tried to induce him to
continue, and when he remained obdurate
announced the suspension.
William H. Betterley, chief clerk, who
had until recently been a telegraph opera
tor. was put in charge as assignee, and he
attached the $35, GOO which the firm had In
the First National Bank of Jersey City
after long and earnest conference with
"Ai'' Adams, jr. According to the best ad-
vices there was a heated argument, and
Betterley remained unconvinced.
Betterley had all the doors locked in the
Jersey City house and discharged all the
employees except a small clerical force.
The twenty-five operators were sent away
with their pay for this week and next, for
bucket shops always like to have the
knights of the key in good humor.