The Detroit times., 1908-12-14
POOR BOOKKEEPING
CAUSED FAILURE,
SAYS CASE
Continued from Page One.)

Continued from Page One.D
eron Currie Il Co. divided commits
slons. and the purchases or sales were
charged 10 Cameron Currie a. Co. and
not 10 the customer. The time OF get
ting certificates for delivery varied.
some times being only a few days
while at other times there was delay.
When did the purchaser become
owner of the stock" inquired Ste
vens
Il suppose when the order was exc
outed." vas the reply.
In other words. your firm was
agent in making the purchases? %
Yes, sir
When asked whether the purchaser
became owner OF the stock if he paid
only part OF the amount. Case replied
that he supposed he did although lie
had never thought OF the matter be-
fore. He said that a large proportion
OF the firms orders were short sales.
These. he admitted, were generally for
speculative purposes only. Sometimes
Cameron Currie Il Co. sold short on
their own account He could not say
whether the firm had engaged in short
sales for six months prior 10 the fail-
ure.
Did Cameron Currie & Co. suffer
any losses the past year from the
transactions of this class OF Gus TOM
er?''
Il believe We did"
ITO any considerable amount
Il cannot say"
Memory is Indefinite.
Cases information or memory vas
indefinite as TO the amount of the
firms losses last year from transac-
tons OH its own account. In looking
up such information, he testified. he
would not go 10 any particular clerk,
but To the first bookkeeper whom he
saw.
In making a sale of stock, the firm
would not care whether the customer
had the stock or not and the amount OF
the margin on short sales varieo with
the state OF the market, being per
cent in some cases. The eastern brok-
ers did not know anything ABOUT the
customers for whom the transactions
were made nor would the customers
know with whom their deals were
made.
did you ever make use Of stocks
carried for one customer TO make de-
liveries on a short sale for another
customer"
Your question means nothing de-
clared Case, and then he explained
that such would be the custom for the
eastern broker The New York brok-
,a.vk hpu
shares Of stock for one customer and
TO sell 500 shares for another GUS
toner and in this case no stock would
change hands, although the two tran
sactions were carried on the books.
There was no separation OF moneys
paid on margins from those paid by
customers for the outright purchase
of stocks; all were turned into one
general fund. Attorney Stevens then
inquired how broker could deter
mine how his customers stood at any
time and whether he could protect
himself against loss.
He could II his margin facilities
were complete" answered Case. Ours
were not. That. | am sorry 10 state.
was the cause Of the failure"
The witness detailed the system Of
handling accounts, and said that all
kinds of people traded in stocks IN
margin-business men, professional
men, and even working girls in some
instances. When customers got be-
hind. the firm had a right to close out
the deals, but the treatment accorded
customers varied according 10 the
persons involved and the kind OF stock
carried. Sometimes they would allow
losers the opportunity TO make an.
other deal in the hope OF pulling
through.
did your eastern agents know You
were In the habit OF buying and sell.
ing on your own account"
we were not, as a matter of pain E"
replied Case
He made the point that the Arm
dealt In stocks 10 protect itself largely.
The advantage OF its stock exchange
memberships was that the eastern
brokers. through whom they dealt, had
to divide commissions with them, each
firm getting lie per cent on, each
share. II was also a large advantage
/ he admitted. to be able 10 use the title
members OF the New York Stock ex
change" In advertising, as IL drew Gus
/ toners
l., The eastern agents stood In the
| same relation to- Cameron Currie G
/ Co that the latter did TO their custom
ers. The eastern brokers were not sub
agents he said.
Adjournment was taken at noon.