The San Francisco call., 1910-11-22
GIGANTIC SWINDLE
. PROMOTERS JAILED
Bun Brothers Have Hundreds
of Fraud Victims in
California
Had Suckers Mailing LIST of
100000 Easily Fleeced
Men and Women
Continued from Page 4

no return to investors.
| Vaughan is also treasurer of the Co
lumbia finance company. which acts as
fiscal agent for the Continental wire
/ less telegraph and telephone company,
and had charge of the Continental office
in this city
| Both raids today are further evidence
that the government in its warfare
| against alleged Interstate swindlers
means business and no longer will be
! content with issuing fraud orders de-
nying them the use OF the mails. but
will press for convictions on criminal
charges.
The present campaign began some
months ago and has resulted in the ar
rest of Louis A. Celia of St Louis and
/ his associates, charged with operating
string OF bucket shops; the officers
! Of the United wireless company, of the
! Ell Progresso banana company. Of the
United exchange of Chicago, of the
Steel-Miller cotton firm OF Corinth,
Miss, and of more than so other firms
! In all parts of the country.
Postmaster General Hitchcock esti-
mates that the public has been feeced
out of at least 100000, 900 by get-rich-
quick concerns in the last five years,
but he says their heyday has gone
Hitchcock said today that other ar
rests involving corporations that have
sought investors throughout the eoun-
try, are expected shortly.
PART OF CAMPAIGN
The arrest today by postoffice in
spectors of the principals in two i'm
portant companies Burr Brothers, with
offices IN the F'latiron building. and
the Continental wireless company, with
headquarters at 56 Pine street." said
Postmaster General Hitchcock, "consti-
tute two more cases I'm the series Of
Investigations which postal officials
have been making in their crusade
against the fraudulent use of the mails
With the work accomplished today
IS cases have been brought to a head
within a year. It is estimated that the
swindling operations of these rs cases
have flched from the American people
$780, O0O,O 600
The crusade now in progress is the
result of carefully laid plan of
some months ago, the first step in
which was a thorough reorganization
Of the inspection service with the Sc
lection of new postofice Inspector.
When certain changes and reorganiza-
tions were effected instructions were
issued to the newly assigned inspector
in charge to take up and prosecute
vigorously all pending cases of frauds
gainst the mails.
owing to the extent of these cases
and the large amount of work involved,
it was necessary to detail consider
able portion of the force of inspectors.
AFTER THE HIGHERUPs
I'm order to strike at the root of
the evil the department directed its
agents to go after the men higher up
in these gigantic schemes to defraud.
and to allow no influence, however
powerful to prevent the proper punish
ment of the Offenders Through the
assistance of the attorney general the
full cooperation of his department was
of this crusade.
"As the work OF investigation pro-
ceeded. it became apparent that the
fraudulent use of the mails was far more
extensive than had been realized.
vast system Of fraud as far reaching
in it's ramifications as the postal system
itself, had been developed by unscrupu-
lous men. who through the grossest
forms OF misrepresentation were steal
ing from the people millions of dollars
annually.
These fraudulent operations have
not only swindled thousands of inno-
cent investors. but have created a lack
of confidence in legitimate business en-
terprise. It is therefore as important
to the business community to have
these frauds stopped as it is to the
people, whose losses are directly trace
able to them.
Formerly the procedure in such
fraud cases was entirely different 1t
was the practice to issue fraud order
against the guilty concern. This
method proved ineffective; while it de-
prived the offending concern of the use
of the mails, 1T was simple matter for
its operators to reorganize under a new
name and thus evade the laws.
I'm the departments present crusade
the practice has been to proceed i'm
mediately to the arrest of the prin-
c1palS in the fraudulent enterprises
the object being to secure prompt con-
viction and imprisonment.
ONLY THE BEGINNING
THE results already accomplished
present only the beginning. The work
of investigation and prosecution will
proceed with all possible vigor until
the swindling of the people through
the use of the mails ends
After the raid Hitchcock gave out
a memorandum concerning the Burr
Brothers. which was organized several
years ago and in 1907 was incorporated
with a capital of 100000, later in
creased to 100000. The memorandum
states that among other companies the
Burr Brothers are selling the stock of
the Buick oil company, a concern with
s5,000,000 capital. The memorandum
further states that they have also or
ganized the following oil companies:
Carolina consolidated, capitalized at 81 &c.,
900; Coalinga Allsdin. capitalized at 81 .00O, 600;
Kern Western, capitalized at SI50,000: New
York -Coalinga. capitalized at 100000: Coalinga
crude OIL capitalized at $500 600; Peoples Asso-
ciated oil company. capitalized at $1,000. 600.
The memorandum continues as fol-
lows:
All the stock in these companies
has been Sold except a portion of
the two first named, and the greater
portion of the money evidently has
gone into the hands of Burr Broth
ers, Inc
While all the companies are still