The White Pine news. [volume] (Ely, Nev.) 1906-1910, 1907-04-13
From Mondays Daily.
EXPOSES HAItRIMBAN'S
GREAT c. Il \. STEAL.

Springfield, H., April 7.-Attor-
nev-General Stead, in an opinion
submitted to Governor Deneed to-
day expresses doubt as 10 whether
il is the province of the State OF llii-
nois to proceed against e H. Harfi-
man and his assistants for The al
leeed manipulation OF the Chicago
and Alton railroad properties. II
the state should revoke the com
panvs charter the loss would fall ON
the stockholders, the Hartman pee
ple already having disposed OF
large proportion Of their holdings.
The general concludes
that the best plan would be FOR the
company itself TO seek remedy lof
the situation. or even for one or
same time Mr.. Stead informed the
more stockholders 10 act Al the
governor that should he become con
WINGED. on further Investigation, thal
the state can relieve the roads con
dition. he will make the necessary
moves at once.
Notwithstanding his convictions as
to the wisdom of immediate action
Mr.. Stead insists there is not the
least doubt but that civil remedy
exists against the iinanciers VINO
have wrecked this prosperous rail-
road company and at the expense oil
innocent stockholders and Dohd-
holders, and have gathered theh-
| selves a harvest of millions OF doi-
lars
Acknowledgement Stead reviews
the testimony given by Hartman re-
Gently before the interstate COM
MERGE commission at New York and
before the Illinois warehouse COM
mission.
The profits made out of the Alton
deals bv Mr.. Hartman and his as
sociates are placed by Mr.. STEAD at
$24.64S.600.
LAS result of this enormous
profit to themselves he declared,
..the railroad companies are thrown
into helpless bankruptcy.
The Indebtedness of the companies
as shown by the figures in the oplh-
ion have been increased to $50, 646,-
21S since they fell into Hartman
hands. OF this amount, only ST.
800 900 according to Hartman
own testimony. says Mr. Stead, was
incurred for improvements, better
ments or extension of the roads.
over s57 10000 of this indebt-
edness," concludes the opinion or
more than 20 per cent of the entire
/ Indebtedness created by this syndl-
cate upon the properties OF these
companies were not created in fur
therance of any legitimate purpose.
Mr.. Stead takes up the Alton deal
in great detail, bringing out the TACT
that in 1898 the company paid all ITS
onerating expenses and I per cent
dividend on its common and pre-
ferred stock and had 100000 left
The company's credit was good and
the syndicate took hold, purchasing
BATE shares of preferred and 1885,
224 of common stock.
The next move in the series of
manipulations, says Mr.. Stead, was
to add $12,444177 to the cost and
Capitalization of the road This con
sisted in part of the income which
the stockholders of the company in
former years had been content 10
apply to betterments and permanent
improvements. and which. by order
of the board of directors. had been
charged upon the books OF the COM
pany to operating expenses and cen
sisted in part Of losses sustained by
the stock holders OF other companies.
The next step was 10 declare 80
per cent dividend ON May 81, 700.
The dividend on the stock owned by
4 the syndicate paid by check 10 Kuhn.
+ Loeb G Co. amounted TO %G69,lSG,
and was charged upon the books of
the company against CONSTRUCTION
expenditure, capitalization.
The syndicate's profits up to this
time, all told, were S14,993, 900,
when followed the lease of the Chi
cago and Alton Railroad company s
property to the Chicago and Alton
Railroad company, and the system
ostensibly transferred its stock TO
Louis Stanton, a dummy. This trans
fer included the st. Louis, Peoria
and Northern railway.
Louis Stanton then sold to the
syndicate all the stock transferred
and the short railroad line which ne
cessitated the issue of $4,000 10
per cent gold bonds. This made the
syndicates profits $24.64S,000.
/ When the syndicate gained con-
/ troll In 1893, says Mr. Stead, the
roads liabilities amounted to $780,
/ 100000. In 1906 the liabilities of
the consolidated company reached
! 9,046,21S, representing an in
/ debtness of $S0,024,0S0 created by
the syndicate. Only $3.50 of this
was created for improvements. But
in accordance with the company
| bonded Indebtedness, which amounts
to $4,000 a mile, its capital stock
liabilities are over $4,000 mile.