The San Francisco call., 1910-07-02
State MineraIOgist Declares
That Several Companies Are
FIeecins the Public
General Denial of Charges Made
With Suggestion of Per-
sOnaI AnimOsity
Operations of Concerns nd
Methods of Using Profits
Are Described
EWIs f. AUBURY. the state min

7 EWIS T. AUBURY. the state min
eralogist. issued yesterday a
IL statement condemning the prac-
tices Of J. T. Kerr, promoter Of bond
mining and oil companies. Kerr, who
has Offices in the Monadnock building,
has been connected at various times
with the Illinois oil bond company, cap
italized at $4,000 900: the Paxton gold
bond oil company. capitalized at $780,
Gee. the Wisconsin gold bond oil COM
pany. capitalized at s1.0o0.0Oo: the Inde-
pendent oil company. capitalized at
100000: the American Duchess oil COM
psny. capitalized at s2.O00,O0O; the De-
benture surety company. several min
lng companies operating in oregon, Ne
Rada and California. and he is at pres
ent engaged in promoting the High
Gravity united oil company. capitalized
at sc.00e.OOO. with holdings near Half
moon Bay.
General Denial of Charges
Kerr replied last evening with gen
ers4 denial OF Aubury's charges and de-
clsred that they were inspired by per
soual animosty.
Aubury has made an investigation
into the affairs Of several companies
which. he asserts. are fleeing the pub
lic. or their promoters he says:
There IS not one chancci a million
of recovering cent from these takers
and there Is only the satisfaction of
placing them behind the bars. but this
course remains for the person who has
been s,viudIed and is one which is
hardly ever adopted.
Operations Described
After describing. tRe operations Of the
1.srious concerns. Aubury proceeds:
The Debenture surety company Was
Incorporated late in 1902 and the stock
seems to have been held entirely in
Nerr's Office. the incorporators being all
has dependents or close associates. This
company was supposed to act as fiscal
agent for the other companies-that is,
10 sell their stock at a commission, the
investigation features on which their
printed matter dwelt being entirely
ridiculous.
"The receipts OF this company were,
of course. ali velvet and were paid out
10 himself CIIerr) in the form of divi-
dends. these dividends being used to
promote the sales OF stock in the other
companies.
Confusion in Statements
The advertisements of all were so
artfuUy confused that without any
direct misstaternents the reader would
he Jed TO believe that the dividends
advertised were the profits Of actual
operations and that such profits were
being or would be shared by the other
companies. while as matter of fact
they proceeded solely from the sale
or vsIueless stock.
This game having finally been
worked TO its limit in 1905 after paying
dividends regularly for many months
Kerr advertised surety stock for sale at
s. for 81 share and appears to have
sold it out. completely. At any rate il
stopped paying dividends and did not
consider il worth while to keep up its
state license tax.
Production OF OIL WELLS
Kerr's oil companies drilled largely
in san Mateo county. or these opera
tions Aubury SAYS:
The total production from the san
Bfateo wells Cmostly from the two old
wells already on the lease) between
s.3ae 1907. and September, 1909, was
Q barrels. or an average Of 80
Sarrels par DAY. or an average or Il
gallons per day per we'll Figures are
lacking for other dates. but as the
lease was undoubtedly being pumped
10 its capacity during this time it gives
q suf5cient estimate OF its possibilities.
TO get this amount of production
SIX holes were drilled, with an aggre-
gate depth Of 500 feet. This. added
rosthe 100 feet drilled by the Paxton
In Ventura. represents the total oper-
ations of seven companies with an ag-
gregate capital Of s7,100.000 an an op-