Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1907-02-28
RAILROADS FIGURES
MERE JUGG[ED
Statements Of Earnings and I'm
provement Funds Misled Pur-
chasers OF Stocks
DID ALTON cAulTALlzE DEsTse
Railway Hearing Indicates That Har-.
riman Management Did Soon
struetion Expense. and Bond Dis.
counts capitalized-Hish Finance
Methods Of Bookkeeping Revealed.

q New York, Feb. 2S.-The interstate
commerce commission today concluded
: Its New York hearing on the investi-
i CATION Of the operations and relations
of the Union Pacific system, and while
there will be oral arguments heard at
Washington on an April date, to be de-
cided later, the testimony has probably
. all been taken There has been no de-
cision yet as to appeal to the courts
to compel Edward H. Hartman and
Otto Kahn to answer many important
questions declined by them, but the
question will be considered after the
commission returns to Washington.
The closing hour of the hearing
brought the statement from Controller
Mat1l that financial statements were
not sent to Southern Pacific stockhold-
ers for several months before the divi-
dend meeting in July last This is
contradiction Of Harriman's testi-
anony. The suggestion from Commis-
sioner Harlan that 80 per cent diyi-
sdend on Alton was illegal under the
Illinois constitution partially clears
away the aspersion about mortgaging
the Murrayville- Springfield cut-off be-
fore it was built.
New York, Feb. 2s.-when the in
terstate commerce commission re-
smeds its investigation of the Harri-
man lines today, Samuel FELTON,, presi-
dent OF the Chicago & Alton since
sI8e9s was called to- show hat about
$1,008,000 from the income, as against
the proceeds for the sale of securities,
was included in the statement that
showed that $22.ooo.ooo had been ex-
pended in Improvement.
Charles w. Hillard. controller Of the
Alton, was next called. He explained
that the cut-off, from a point near
Murray vile to Springfield, which he
yesterday testified had been mort
gagged before 1t was built, was one
which the Alton had right to build.
The proceedings were not unusual. The
enterprise and method Of mortgaging
were legitimate.
kellogg endeavored to show the Har-F
riman management of the Alton had
capitalized debts of the old Joliet &
Chicago road. prior to 1868, but Hillard
said his knowledge Of the roads af-
fairs did not go back that far. It was
ELECTED there never had been fore-
closure on the Chicago & Alton railroad
or railway while the old Joliet & Chi
cago had been foreclosed. Witness said
$1,000, 600, which it is claimed the,
Hartman party added8to the capital OF
the Alton beause that amount had been
expended on improvements or lost, had
previously been paid and the accounts
written off. He said certain construc-
struction expenses and discount on
bonds had been capitalized by the Alton
and that while the books disclosed it
the annual report would tend to con-
fuse the public in that regard.
In answer to questions from Com
missioner Lane, the witness questioned
the right OF directors of the Alton in
going back over their books for per-
iod Of many years, and capitalizing the
expenditures He said that each sue
ceeding board of directors had each
year passed upon the accounts. and he
thought such acts should have been
final.
Witness repeated his testimony of
last evening as to the transfer of the
Alton, from railroad company to rail-
way company, thru Louis Stanton. He
said It was evident from the books that
the syndicate had simply handed over
$22, 900 900 in bonds and had received
preferred stock and st. Louis, Peoria
& Northern property. Asked how
much the Hartman interests had paid
for the Alton, and how much they got
out Of the transaction, Hillard- said he
was unable to state the profits He
had no means of knowing.
After the examination of Hillard was
concluded there being no more wit
nesses, the hearing was adjourned
without date.