Belding banner. (Belding, Mich.) 1889-1918, 1907-09-26
STANDARD OILS
GREAT PROFITS
MADE OVER ONE THOUSAND PER
CENT PROFITS IN ONE
YEAR.
QUEER METHODS SHOWN
How the Great Combine Was Worked
to Make Millions on Small Invest.
ments.
OPENING up the Scheme.

More light was shed on the remark
able earning capacity of the various
subsidiary companies of the Standard
Oil Co. when Frank b. Kellogg, who is
conducting the federal suit, succeed
ed in placing upon the record the
profits of seventeen of the principal
subsidiary companies In the years
1903 and 1906. The statement of
earnings Of the Standard Oil Co., OF
Indiana, which was recently fined $780,
100000 by Judge Lands, of Chicago,
for rebating, disclosed that in 1906 the
company earned no less than $780,
516,0S2, on a capitalization of 81 ,000,-
600, or over 1000 per cent a year. The
Indiana company in 1906 earned more
than any subsidiary company Of the
big combine.
Mr.. Kellogg developed during the
day, while Clarence G.. Fay, assistant
comptroller of the Standard Oil Co.,
was on the stand, a curious problem
of financial bookkeeping, or handling
of accounts, which Mr.. Fay failed to
explain. From figures submitted it
was shown that the Standard Oil Co.,
of New York, in 1904, made a profit of
$7,751, 160, and paid in dividends to
the Standard Oil Co., of New Jersey,
the total sum of $685. 30. This
transaction reduced the net assets of
the New York company from $40,425,-
900 to SIS, 49, 06, while the liabilities
leaped from $47646,235 in 1903 to
$S1 1895, 145 in 1904, an increase of
nearly $34,000,000. The gross assets
of the New York company, however,
increased from $SS,074,561 in 1903 to
$96,574,S 1852 in 1904. Meanwhile the
accounts receivable of the Standard
Oil Co., of New Jersey, grew from
SIS, OLA in 1908 to $5S,272,924.
Mr.. Fay was closely questioned as
to the nature of the increased liabili-
ties of the New York company and
Increase in the accounts receivable of
the Standard Oil Co., of New Jersey,
but he said he could not tell until he
had examined the books of both COM
panies, which he told Mr.. Kellogg he
would do.
Charles M. Pratt, secretary of the
Standard OIL Co., recalled to the wit
ness stand, told how he had held for
the Standard Oil Co. the stock of the
Waters-Pierce Oil Co., at the time
when 1t was not permitted to oper-
ate in the State of Texas. He said
that he held the stock as a matter of
convenience and not to avoid the anti
trust laws of Texas.
Mr.. Pratt threw some interesting
sidelights on the Waters-Pierce Oil
Co., the stock of which was held for
a long time by M. NJ. Van Bueren,
who was not connected with the
Standard Oil Co. Mr.. Van Bueren
purchased the stock from Mr.. Pratt
and early this year the Standard COM
pany bought it back. The nature of
the transaction showed that Mr.. Van
Bueren received from the Standard
Oil Co. exactly what he paid for the
stock, and that during the time he
held 1t the dividends were paid to
the Standard Co.
Wesley Tilford, treasurer Of the
Standard OIL Co., was called to the
stand and Mr.. Kellogg made an eff
fort to have spread in the record a
copy Of the trust agreement OF 1882,
but John G.. Miburn. chief counsel
for the defendant companies, objected
on the ground that such an agree
ment was prior to July 2, 1890, when
the Sherman antitrust law went into
effect.
AS testimony in the Standard Oil
inquiry has developed that the earn
ings of the trust for the past eight
years have aggregated $500, 1874, or
more than SCI 100000 a year. a one
fourth interest in the concern would
give John ID. Rockefeller an income
Of more than $15,000,000. This. of
course, is aside from his many other
investments.
His other interests, it is said, would
make his total income three times
this sum.