Abilene weekly reflector. [volume] (Abilene, Kan.) 1888-1935, 1909-12-09
MINING SWINDLES AND
HOW THEY ARE WORKED
MINING SHARKS AND THEIR
DISREPUTABLE SCHEME


I This week there was punctured
on the Broad Street curb market
copper stock bubble. Ely Central
was the bubble; from price of $4.2t
q share the stock on Monday sud
denly fell to $3.50. then on Tuesday
It went to ST., Wall street, Of itself
was not greatly interested in the
event, for Wall street had not been
caught in the decline; but ln the
households of many small and inno-
cent investors al over the country
there has undoubtedly been grief
over money lost and dreams van
ished.
The immediate cause of the col
lapse in this stock was the publica-
ton in a New York weekly trade
paper, the Engineering and Mining
Journal, Of disclosures Of the ELY
Central Copper Company and its pro-
moters. Emitting its articles "A
New Scheme to Hook Suckers" the
paper told how the recent rise of the
stock was the outcome of campaign
conducted by an ex-convict, through
a New York brokerage house, to sell
the shares of the company-which,
it declares, are practically worthless
at greatly inflated prices and at
enormous profit to himself. The
story told is shameful enough, but
the pity of it becomes greater when
it is realized that the losers are not
the professional spectators OF the
Stock Exchange, or even the people
who dabble in Wall Street OCCASION
ally with their surplus savings.
People of small means, unfamiliar
with the wiles of shady finance, Will
feel the pinch; those who were in
weighed into buying the shares py
the glowing accounts Of its prospects
which emanated daily from the New
York brokerage house furthering the
scheme, and who were blinded to the
real value of the stock by Its great
activity and steadily advancing price
on Broad Streets open air market.
Since last July the stock had been
rising, its price then of 81 cents
share being followed by uniformly
higher quotatiins, until $4.25 was
last week reached. Experienced
Wall Street saw through 1t all; the
professional operator needed no onsi
tn tell him of fictitious transactions
of matched orders, and wash sales'
for he had been through it all be-
fore; but the others-the OUTSIDE
small-fry-how were they to know /
They saw the stock quoted daily by
the press, they read the advertise
ments of a supposedly AeputaOie
brokerage firm, and they were told
glowing stories of the property. It
Ia human nature to grasp at bar
gain, and these people grasped.
DOdging the Law.
The exposure Of the company
and the attending collapse OF It's
shares have naturally brought down
upon the promoters of the scheme
virtuous condemnation from the gen.
eral public. Why are they allowed
to exist, it is asked, and why does
not the law take hold of and punish
them for such dishonest practices!
The answer is all too simple. Pro-
motors of such schemes make sure
to keep within the technical BOUNDS
of the law, They have mime
Il may be no more than . hole In the
ground. but still it is "mine"-and
thew issue shares against it, to fl
nance dts development. They are
not breaking the law by selling these
shares, nor are they SHINING Wnen
they advertise the fact that they have
extracted from the mine" a nugget
of pure gold, or a carload OF ore
which is almost all copper, unless 1t
can be proved that the nugget OF
gold or the copper-bearing one has
not come from the same mine, and
crude risks are not necessary.
In the Ely Central case, to be sure
the company actually has a large
area of land In Nevada, which d.
rectly adjolns and lies between the
two mines Of the Nevada Consolidat-
ed Company, but according to the
disclosures of drilling without yet
discovering ore An engineer has
been over the ground, and pronounc-
ed favorably upon It He speaks OF
actual ore reserve in a stretch OF
ground 1900 feet long in which little
a.