Los Angeles herald., 1907-10-18

SUSPENDED
ON CHANGE
AUGUSTUS HElNzE OUT OF
MERCANTILE
INSTITUTIONS IN HAMBURG AND
BUTTE CLOSE
AmaIgamated Dividend, One Per Cent,
Is Half Of Preceding Disbursc-
ment-soIvent, Will Pay All,
Declares Firm
BY Associated Press.

BY Associated Press
NEW YORK, Oct 17.-Sensations fol-
lowed each other in rapid succession in
the financial district today as the result
of the collapse of the projected corner
In United Copper, and the suspension of
prominent brokerage firm yesterday.
| The firm of Otto Heinze & Co. was
suspended in the stock exchange.
f. Augustus Heinze the Butte copper
InasHate, resigned the presidency es the
| Mercantile National bank of New York
The Amalgamated Copper company at
| its directors meeting cut its quarterly
dividend from per cent to l per cent
| The directors of the Boston and Mon
tana Copper company declared quarter
ly dividend of Sc in place of a former
dividend of s12.
prominent bankers of Hamburg, Ger
many, with liabilities that may reach
| $1,500,000, was announced.
| The State Savings bank of Butte, Mont +
| of which the Heinzes are the principal
| stockholders. suspended.
AS a result of these sensations the
| stock market was halting and irregular
| but there was apparent feeling that the
| break of the attempted corner il United
| Copper had cleared the atmosphere some
| what, and the market rallied before the
| close. The suspension of Otto Heinze e.
| Co., of which firm Max M. Schultze is
| the stock exchange member, was based
on complaint to the exchange made by
| Gross & Kleeberg, the stock exchange
firm which failed yesterday.
| Claim 100000
In communication to the president of
| the stock exchange, this firm charged
Otto Heinze & Co. with refusing to ac-
| cept 3211 shares of United Copper said to
have been bought on order of the Heinze
! firm. This action, Gross & Kleeberg
| state, was responsible for their failure
| Attorneys for the firm stated today that
I the amount owing to the firm by the
Heinze firm aggregates s600,000
| The Heinze firm announced that it is
perfectly solvent and that all it's legal
obligations will be met. The attorneys
| say that the suspension by the stock ex-
| change was accepted by the firm in Or
| der to give the latter an opportunity to
| sift its legal obligations from numerous
claims which have been made against il,
which. it is alleged, the firm is not legally
obliged to pay.
| The resignation of F. Augustus Herze
| from the presidency of the Mercantils
National bank, it is said, was decided
on at midnight meeting at the home of
c. w. Morse, who is largely Interested in
the bank.
1t was announced this morning, Mr..
statement in which he said his resignation
was due to the fact that he wished 70
devote all OF his time to straightenirg
out the business of his brothers firm. lie
stated positively that he had not dis
posed of his holdings in the bank, and
that the control was where 1T had been
and that he would continue as director.
Ridgey Suggested
William B. Ridgely, at present United
States comptroller of currency, has been
rendered the office of president Of the
Mercantile National, but has not decided
whether he will accept it.
The low price of refined copper, which
dropped even lower today and the dis
organized condition of the metal market
is the reason given for the reduction of
the dividends of the copper companies.
The announcement of the Amalgamated's
quarterly dividend of per cent came as
surprise.
The failure of the Hamburg firm and
the Butte bank followed closely on the
news of the suspension of the Heinze
firm on, the stock exchange.
The Butte bank was largely controlled
by the Heinze interests. +. Augustus
Heinze being the principal stockholder,
and news of the Otto Heinze & Co.'s
SUSPENSION from the stock exchange and
the failure of the Hamburg firm precip-
itated a run which Immediately caused
suspension of the bank.
In a statement issued by the officials
it was declared that the bank was per-
fectly solvent and that the suspension
is solely for the purpose of obtaining
time to arrange the banks affairs
number of meetings were held today in
the offices of Otto Henze & Co., but no
statement of any sort was given out.
May Reach $25oo,oo0
1t is said the claims against the firm.
growing principally out of the attempted
corner in United Copper, may reach
81, 500, 900.
Rumors were in circulation just before
the close of the stock market that four
other firms besides Gross & Kleeberg
had suffered heavily through the opera
tions of Otto Heinze & Co. in United
Copper. The four were involved it is 7
said for about $1,500,000.
Max M Schultze was indefinitely sus-
pended The official notice said the sus-
pension was imperative under the rules,
inasmuch as he had time and opportunity
to notify the exchange OF his insolvency
and had failed to do so.r
United Copper was weak and active on
the curb market today. The first sale
of the common stock was at $13. as COM
pared with SIS last night. 1t quickly
dropped to so and then recovered to
$3.50.
Otto Heinze s. Co. made the following
statement at the opening Of the stock
exchange today:
'Arthur p Heinze is no longer a mem-
Der of the firm Of Otto Heinze & Co.
The firm of Otto Heinze & Co. feels
itself perfectly solvent and will meet
and pay all its just and legal obligations
In full. The firm, however, refuses to
pay obligations which II does not con-
slider legal or just until a proper adj
justment of the matter has been made.
Rather than submit to such unjust de-