The Hope pioneer. [volume] (Hope, N.D.) 1882-1964, 1907-11-21

the venture could be made a success If
according to certain plans
and under given restrictions. This
does not signify that he will continue
to retain that confidence or that he
is willing to be understood as giving
the venture his unqualified endorse
ment or to say to the public which
respects his name and position: Come
and share this enterprise with me;
put your money into it, for it's a
good thing" But you may be sure
that his name will always be used to
create this impression If there has
ever existed a shadow of warrant for
using it, under whatever restrictions.
Therefore, take nothing for granted
with regard to references or other
which appear in the advertis.
Ing matter Of a concern which applies
to you for the privilege of spending
your savings.
But let me place special emphasis
upon the crafty use which these com.
panies make of the names and the ser.
vices of reputable trust" companies.
l use the word services" because a
trust company may execute a trust"
IN connection with bonds, stocks,
property or securities, without really
assuming any general financial or
moral responsibility for those securi.
ties or without becoming a sponsor
for them. In a word, the trust COM
pany may engage to act as an escrow
agent to see that a certain technical
transaction is completed and nothing
more. That means this: The trust
company consents to hold the stakes
between two parties but without the
slightest responsibility as to the value
OF those stakes or what may be done
with them after the stipulations as to
the conditions precedent to delivery
have been fulfilled. Because a trust
company acts as the trustee of a Ger.
tain bond issue there is no warrant for
a prospective investor to feel that the
Of the trust company are
! n any n behind those bonds as a
guarantee of value. There are almost
as many different kinds of trusts" as
tnere are different transactions; the
trust company undertakes the respon.
slDlllty OF doing a certain definite and
particular thing and nothing more:
II may be to f%oreclose if a mortgage
IS not paid, or it may be to issue so
many shares of a certain stock to a
certain person wher a stipulated mum.
Der OF shares of another issue are
surrendered.
But there are very few men even
fairly familiar with business routine
Wao 90 not form an impression that.
somehow, the big trust company is
behind the stocks for which it acts as
transfer agent or perform any other
act OF trustship. 1t is almost impossi-
DIG to drive this idea out of the minds
OF me3 who are not really familiar
with corporation matters from an in.
side viewpoint. They will insist upon
attaching to a limited service an un
limited moral and financial RESPONSE
blllty that does not exist.
1t is, therefore, of the highest posi-.
bic Importance If you find yourself
tempted to go into an investment. that
you learn from the trust company
mentioned in the literature of the ven
ture exactly what trust" it has un.
dertaken to perform. If it is a really
rellable and established trust com.
pany with a genuine financial stand.
ing it will make the limitations of it's
trust r cleA.' t. yod; II VII take
special pains to make you understand,
for example, that it's only function
IN the matter in question and in con.
nection with the company concerned,
is the purely technical one of seeing
that a certain issue of bonds is
made "in form" when the technical
preliminarfes have been complied
with and that it does not give an
ounce of it's prestige or moral support
to the bonds themselves or stand lie.
gally bound for a penny of responsi.
bility in connection with them. An.
other word of caution: Whenever
you see the name of an educator. a
pastor or a popular politician or any
other leader having a hold on the sen.
tlment of a community, used in connec.
ton with an investment offering, look
into it carefully and take no step until
the person mentioned has been cues.
toned directly by you.
know of an instance where the
poor people of a parish were victim.
lied because the INSCRIPTIONS agent
had attached to his ~prospectuses and
circulars the name of a popular priest
of that region. These poor victims, in.
stead OF going to the reference" sim,
ply said: IF the fathers in it, sure
it's all right" and they we're relieved
of their savings before the father
learned of the use of his name-which
was wholly without his knowledge.
The solicitors for this swindle had
played a bold game and banked on
EsKaahqsssasa-