New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1910-04-21
SUE CANADIAN MINES CO.
Philadelphia Brokers Complain
of Conspiracy to 0efraUd.
WHITMAN TO INVESTIGATE
District Attorney to Examine
the Evidence-Complaint Gives
the Alleged Details.

Inc Canadian Mines COMPANY. the MACK
Brothers and Walter r. Raymond had
summons and complaint served on them
yesterday in suit charging conspiracy
70 defraud and cheat brought by Bioren 4
Co. stock brokers. of Philadelphia The
suit is for 10000. The other defendants in
this action are Hndrath & Carnick
brokers; James J. Campbell. broker, and
Arthur A. Dunphy.
The suit arises out OF one 81 a number
OF similar transactions IN Canadian Mines
Company stock an account OF which was
published exclusively in The Tribune on
Tuesday Dunphy put ID as collateral Sc
curity with Bioren & Co. seventeen hun
dred shares OF the Canadian Company's
stock Tor his transactions with Bioren &
Co On the latter dealings he lost over
SON. IL is alleged. and, Dunphv. failing
70 make good his losses. Bioren & Co. or
oered his collateral sold and then found
that ii was impossible % have the stock
transferred. 81 being claimed that the mine
stock had been originally hypothecated on
the condition that II was not to be sold.
According 20 the complaint. Mack
Brothers. selling agents for the Canadian
Mines Company. signed the stock IN blank
and got Walter 3. Raymond. the presi-
dent 10 fndorse It Then Mack Brothers
=
sntee IL. Il Is alleged that the stock would
then be turned over n varying quantities
20 a broker presumably as collateral Sc
curity for a loan OF s. 50 q share under the
condition that Il could be -ehypothecated.
borrowed on, or, in fact. that anything
could be done with Il except sell it At
the maturity OF the loan II paid, Mack
Brothers had right to demand the return
% the identical shares.
The complaint charges TRAIT the real
purpose OF the last stipulation was 20
enable the defendants 70 carry out their
alleged conspiracy 10 defraud- Il charges
that the stock was thus originally nv
pothecated- with the distinct understand
ing between the defendants that a broker
was 20 turn IL over 20 Dunphv and the
latter was 70 place IT as collateral Sc
curity for such loans az he could raise. /
and that Z was further understood that
when these loans uatured Dunphv was 20
fan 70 paw them. The money he raised
on the stock Il is charged. was TO 20
mainly 70 Mack Brothers.
Then. according - the complaint. when !
the holders Of the Dunphv loans sold the /
stock IN open market after maturity and
non-paynent. James J. Campbell was 70. /
and did buy n the stock. and after pur- /
transferred 10 John Smith or Henry Jones
or any one else he saw ft. In the mean /
tine, Il is alleged. before the stock /
was even given 10 a broker. Walter B ]
Raymond or the Mack brothers had or I
dered transfer on IL stopped.
Accordingly. when transfer was de- /
manded. il was refused Then the com
plant continues. the purchaser. one Of 4
the defendants, would buy Il in. the mar
ket being manipulated n the mean time 4
by others Of the defendants so that 4
Canadian Mines vas quoted at a con- |
siderzbly higher figure. and after doing 50 4
would demand the holder OF the rehy- /
pothecated stock 70 make good his loss 4
Again. according 20 the complaint. Mack /
Brothers would then step in and bring |
suit against the latter for the recovery
or the shares. onfthe ground thatthey had /
been stolen from them
SO that. according 20 the complaint II /
everything worked as planned in the a. /
legged scheme Of the defendant the result /
would be that the man who lent money 1
on the stock would lose. first hts loan. 1
second. the difference between the price AZ 4
which he sold his collateral security and /
the price At which, by manipulating the 1
market. Campbell. an agent Of Mack I
collateral security itself The complaint |
also alleges that Hud-sth & Carnick made 4
fictitious sales Of Canadian Mines Com I
pany stock on the curb.
That the District Attorneys Office win /
take a hand in Canadian Mines stock /
transactions Is made plain by the following 4
statement which District Attorney Whit 4
man made yesterday
Z have seen in The Tribune accounts 4
OF transactions in Canadian Mines Com /
uzny stock These transactions 7 ALL have /
thoroughly investigated Il the evidence /
justices Il indictments viii be found. and 4
every effort VIII be made 20 punish the /
ones guilty Of any wrongdoing.
Walter p Raymond, In discussing the !
summons and complaint which had been /
served on him and which he showed 10 a /
reporter for The Tribune. said that he I
would answer II to-day.
Il viii enter 4 general denial he said. /
and move that many % the allegations /
be stricken out- NJ only interest in the 4
mines company IS 100 shares Of stock /
which was given me TO enable me 70 4
qualify for a director, and have never |
made any money out q the company Il /
is outrageous 10 draw me in this Etiga-
ton, but my reputation VIII speak for It. /
self Il Is true that this stock has been 1
manipulated. Some people on the inside
knew that the company was negotiating
for. some exceedingly valuable property. |
and that was why the stock has been
Quoted 50 high. one DAY when . broker
was down here for some stock the Macks
asked ne 20 have T. indorsed By a stock
exchange house and put Il In M name
SO that could do so"