The Washington herald., 1907-02-28
ALTON MORTGAGED;
TREASURY EMPTY
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testified that he had hxed the price at
which this was sold to the Union Pacific,
together with John A. Stewart and J. J.
Mitchell. Kahn said Hartman did not.
Hartman testified that he got the others
to bring the price down.
81 take issue with Mr.. Kellogg in say
ing that Il was worthless stock. said
Kahn. Mr.. Severance asked: Were any
of the directors Of the Union Pacific
owners OF the shares sold 10 the Union
Paeific?" and Mr. Cravath objected and
told Kahn not 70 answer. Kuhn, Loeb &
Co, he said, in this matter were acting
as bankers. and this was an affair relat-
ing to their clients.
sale to the Alton.
Now I will ask you, Mr.. Kahn" said
Severance, whether or not il is a fact
that on October II. 1899. your firm sold to
the New York Life Insurance Company
and Goldman Sache & Co, on joint ac-
count, or TO either of the parties, 4,00O.0OO
par value OF the Chicago and Alton per
cent refunding 50-year gold bonds at IS
and interest, as syndicate managers?'
we never sold any such bonds TO the
New York Life. replied Kahn, who said
that they had sold them to a syndicate
of bankers.
Didn't you know the New York Life
were purchasers Of those bonds"
I'VE did not; We had no idea Of it,"
Kahn admitted the sale of the bonds
TO the Equitable
WAS Mr.. Schih a director of the
Equitable at the time Of those sales?'
Yes. he was one Of sixty directors"
said Mr.. Kahn.
Going on into the Chicago and Alton
deal it was disclosed then that Messrs.
Schin. Stllman, Hartman. and Gould had
bought the St Louis. Peoria and North
ern road and had sold the most import
ant part OF il 10 the Illinois Central for
3, 200. GEO Then they sold 10 themselves
as the Alton road a fifty eight mile see
ton, about half as long as the part sold
TO the Illinois Central, for $4,000 600. Kahn
refused to admit that the part sold 10
the Illinois Central was more valuable.
but It seemed TO toe shown pretty we'll
our Love for Union Pacific.
When Kahn was questioned about the
sale of I05.000 Illinois CentraTs threes, 10y
his finn. he refused to answer.
Witness said at the time they sold that
stock for $40 it was selling in the market
for si79 1t was sold at this price, he
said. because Of "our" love for the Union
Pacific
In reply 10 Severance, the witness said
that the speech made by Schiff, IN Jan
uary, 1906, before the chamber of COM
not Immediately pass a currency bill, had
nothing To do with the firm selling of the
stock at such low figure
Here Severance produced a statement 10
show the stock at its highest point only
reached 1919. in June and witness said
be was confident the firm could have sold
II az 40 and could sell IL at nearly that
price to-day
He refused to say to whom ne could
sell g.
That ended the efforts OF the lawyers
10 get the name Of the mysterious indi-
vidJal VINO would have given eco. 1t was
plain 10 see that they believed It was
either Mr.. Fish OF one Of his friends,
Mortgaged UnbulIi Road.
When Hillard. Of the Rock Island. took
The stand everybody expected something
4it tti f-stllle- aAf- TOT Nl.sl-N e tNN va nNbhE
and papers up on the stand. Hllard
said that he became comptroller on Octo-
Der 10 last. He told 40 some length of the
condition in which De found the Chicago
and Alton Railway Company-the consol-
dated company
Mr.. Kellogg produced the mortgage Sc
curing the 100000 Of 3l4 per cent bonds
and asked him II that was the mort
gage covering The unCunstIuctrd railroad.
HHlard said that it was He admitted
the road had been mortgaged before being
built
The mortgage. which was put in evil
dencc. showed that it included "aH the
railway premises and property of the com
psuy lying from point on the Chicago
and Alton Railway Company between
Murrayviile and q point in or near
Springfield This was q second lien of
tho railroad company. there being a SO
00e,0Jo mortgage ahead Of il, kellogg
said
HWard said that All of the bonds had
been sold and then KelloEg proceeded TO
show that these were the bonds which
Hartman. Mortimer SChiff. Gould and
StIlman. as the Chicago and Alton Rail-
way Company. had voted to sell for Sl3,
0o1.000 cash. the cash according 10 the
minutes of the meeting. to be paid to
one Lewis Stanton for his offer Of pre-
ferred stock Of the Alton Railroad Com
pany and the hfty-Cight-mile railroad
Sle.e00.000 10 De paid for the stock and
100000 for the railroad. the stock and
the railroad being owned by the four gen
tiemvn and transferred for purposes Of
the transaction To Stanton.
Session May Close To-day.
AS a matter of fact. said HjIIard. "the
books show that the Sl5000000 was never
paid for the bonds. the Sl0.000000 was
never paid to Mr.. Stanton for the stock:
the 100000 was never paid 10 Mr. Stan
ton for the railroad; but the 5000 eco was
turned over 10 the syndicate who delivered
the stock and the road through the inter
mediary of Mr.. Stanton"
Witness admitted that all these bonds
We're out.
HHlard said that the bonds represented.
so far as he could see. the preferred stock
and the railroad turned over By Stanton.
That ended his testimony for the day. He
will continue on Alton finances tomorrow.
1t is the expectation that the inquiry
VIII "O Hi'i9'i'u A''O WI" tu-iiuttoW
session.
Hartman Testimony Ends.
Mr. Hartman took the witness chair a
little after 10 O'Clock. He said i'm answer
10 Mr. kellogg that the Union Pacific had
purchased the St. Joe and Grand Island
since last year. The price paid was s.
Or 600. and the witness had owned the
prODertv and sold il 10 the Union paci6c
Objection was made TO questions as to