The Birmingham age-herald., 1908-08-30
To Make Example of A. 0.
 Brown & Co.
HAD SPORTY CLIENTELE
Board of Governors of Stock Exchange Will Undertake Heroic Job of Self Purification-Perfor
 Will Be Spectacular.
By w. G. NICHOLAS.

1 whose failure has demoralized the specu- lative machinery of the street. A. o.
 Brown & Co. was the showiest house in
 Wall street It had a sporty clientele and
 was used very often by important people in manipulative campaigns. Nothing that A. o. Brown & Co. did excited surprise.
 It was due every day for spectacular performance of some sort or another.
 It might be dead for awhile and then at any moment it might spring into amaz- ing activity with buying and selling orders in 5000 and 10000 share lots. It was no uncommon thing for MT. Brown himself to move around the exchange and do a business of 50,000 shares in an hour or two just to liven up the game, as it were, l The firm, while very often immensely act i've and regarded by the public at large as being unusually successful, did not have very righ rating in the banking world. It was looked upon with more or less suspicion as a concern liable to take too many chances and to play for too high stakes on insufficient capital. Never theless, it did business on the exchange and got into the newspapers with great regularity. Its contracts were O. K. on the exchange and practically every house was willing to accept it's orders for the usual g commission.
 A few weeks ago it executed large sell 1 ing orders in New York Central and when l 1t came to deliver the stock the certificates were traced to MT. Harrimans office. The i correct conclusion was immediately ar rived at-that MT. Hartman had dis posed of the Union Pacific holdings in ] l1a of A. O. Brown & Co. decided that 1t would be a good plan to go short of New l ork Central, which it proceeded to do, also putting its clientele wise to the situa- 1 tion. The stock which MT. Hartman sold presumably about 150,000 shares CSl5, 600, ,0O0), seemed to have lodged somewhere for the market struck rock bottom and re- fused to yield to the enormous short sell ] ing, which originated principally with A. O. Brown & Co.,, although that was not the only house which was caught in the i trap. A short interest amounting to about i 250,000 shares of New York Central was put out by this single concern, and prob ably as much more by others, who sup posed themselves to be in on the know. l The inside of the phenomenal play of a week ago, when orders from A. O. Brown l x Go. amounting to 1,50O0O0 shares were 1 executed on the exchange, Is not yet known, and may never be disclosed, but i the prevailing idea in Wall street is that i it was a desperate attempt on the part of members of the firm to demoralize the l market and cause slump in prices, which would enable them to save themselves from ruin. In this same connection and i as part of the same story is the theory I that the house was running a gigantic 1 bucket shop and that it had been taking the bets of its customers all through the 1 big rise in the market, which began three months ago and is still in progress The members of the firm in refutaton of this charge go out into the open with a grand stand play, inviting the officials of the stock exchange to go through it's books. 1 They indignantly insist that every trade they have made is regular and that for every buying or selling order there Is a legitimate offset. This may all be true and a concern still be a bucket shop. 1 Bookkeeping to cover bucket shop trans actions has been reduced to a science in Wall street Accounts, dummy or other wise, can be put through the books to i completely cover such ilcit transactions i and to prove conclusively to the satisfac- tion of the most skeptical experts that black is white or white is black. This statement of a well known Wall street fact must not be construed as a claim or charge that A. O. Brown & Co. have been running a bucket shop. The chances are that they are as free from this offense as nine out of ten of the members of the 1 stock exchange.
 However that may be, there is a pres- ent disposition to make the firm of A. l O. Brown & Co.,, a scapegoat for the abuses charged against the exchange. l Under cover of a cavalry charge against this firm the board of governors expect l to divert public attention from the evils which have made that organization uni l versal target for political and moral at l tack. The intention is to give an exhi- l bition of housekeeping which will be im- | pressive both at Albany and at Washing
 ton and convince legislators and the public l at large that the exchange is not only
 willing but anxious and able to perform heroic job of self purification.
 1 The board of governors were quite over whelmed with the disgrace attaching to exposures of the iniquities of the bank rupt firms of Coster & Co.,, and Mcintyre | & Co.
 They were going to do the purification act in those cases but unuckily this pro- l gramme was frustrated by the suicide of
 Coster and the death of Mcintyre. In the absence of an example of the first mag nitude the governors gave an exhibition i of virtue in the case of E. B. Havens x 1 Co.,, who happened at that moment to get
 under the limelight with an application l for a six months extension of time in
 which to settle up their bankruptcy af-
 fairs.
 MT. Havens was admittedly a man of unblemished personal honesty He was the floor member of the firm of E. B. Ha-
 vens & Co.,. and his entire time was oc- cupied on the exchange, the office man. agement being left to junior partners and
 employees who robbed him of about $500,- ! 000 The extension was denied on the i plea that while MT. Havens himself i might be- and as a matter of fact was,
 entirely ignorant of the dishonesty ! (which ruined him and stripped him of q | well earned fortune) he should have
 known what was going in his of
 flee that much being due to his fellow
 members. Incidentally, it may be re- marked in this connection, that MT. Ha- 1 vents indebtedness on the floor was ! about $71 ,OO0 which was the amount real
 ized from the sale of his seat, and was | distributed among the members alone, outsiders getting their share of what
 might be left
 1 The member of the governing board
 which took this action in Havens case
 who was most influential in turning
 down their unfortunate associate was R. H. Thomas, president of the exchange.
 As an incident of the A. O. Brown cat
 astrophe, it is noted that the firm of K.
 among the floor members concerned in
 the sensational coup of week ago. Ihe
 exact amount of A. o. Browns business
 tc~