Atlanta semi-weekly journal. (Atlanta, Ga.) 1898-1920, 1911-07-28
SOUTHERN LOAN MEN
PUT UNDER ARREST
BY POSTAL OFFICERS
Richard Puryis, President.
Ernest o. Helm, viCe-Presi-
dent, Guy King, Secretary
Taken in Custody

On two charges OF violating the postal
laws in the operation of the Southern
Loan and Trust company. which was
put into bankruptcy several weeks ago.
Richard Purvis. the president; Ernest
o. Helm, vice president; Guy King. sec
rotary. and W. N. Smith, former secre-
tary, were arrested by officers of the
United States government Thursday
morning and taken before Commissioner
Colquitt Carter, where the amount o. +
each individual bond was made and the
date of the preliminev trial set, the
latter to take place August 15, 1sIt.
The bonds for Purvis and Helm were
fixed at $500 each. and Smith ana
King $4,000 each.
For several months the government
has been busy at work in procuring evil
dence which they believe sufficient to
convict, and the four arrests Thursday
were the result The warrants for each
of the men were for using the mails for
furthering schemes to defraud and for
the promotion OF a lottery scheme.
The men under arrest stated Thurs
day morning that they were taken
completely by surprise. and through
their attorney, Jas. T.. Wright. OF Ma
pierl& Wright. claimed that they would
show a complete defense of the charges
brought against them- And Mr.. Purvis
stated that the contract which the COM
pany had been selling had been passed.
on by Inspector Zimmerman for the gov
dernment about two years ago. the in
spector particularly looking into the
question of lottery at that time Ban
herman was then connected with the In
spection department of the governmenx
in Atlanta.
SCHEME TO DEFRAUD.
However the officials of the govern
ment are congratulating themselves on
the arrests made, which they claim
will show the exposure of one Of the
greatest schemes to defraud in the SOUTH
George NJ. Sutton, inspector in charge
of the Atlanta division of the postoffice
inspectors, was particularly pleased with
the work of the men under him.
Purvis and Helm were arrested by
Postoffice Inspector George r. Cellar
just as the two men were leaving the
Fourth National bank building, where
| the company has offices on the fourth
>
department of justice. arrested Smith
on the tenth floor of the same building.
Mr.. Smith has been for some time with
the Union Fire Insurance company, leav
ing the Southern Loan and Trust COM
pany the first of the year. King was ar
rested in offices of the Southern Loan
and Trust company by Deputy Marshal
Reinhardt.
In the charges to be brought by the
government they viii show how the
Southern Loan and Trust company first
started back in December. 1907, at Della.
Ga, as the Ocilla Real Estate and Loan
company The officers were then, A. I:
Howell, president; Richard Purvis. vice
president and A. A. Floyd, secretary and
treasurer The original capital was then
100000 which was later increased to
$500. CO., 1t was then moved to Atlanta
in January, 1909, and the name changed
to the Southern Loan and Trust COM
pany. Floyd and Howell then dropped
out of the company. and We're replaced
by Smith and Helm. Guy King came In
after Smith dropped out some time
early in the present year.
CLAIMS ENDLESS CHAIN.
In the report which wiz. be made to
the government the arresting officers
claim that the proposition of the COM
pany was TO issue loan contracts.
Monthly payments were to be made 81
Is each. and the contract holders were
allowed a loan when 10 per cent OF the
amount of their contract had been paid
But contracts, were issued in series
of 100 each, and each contract holder
was not entitled to Jorrow on MS con-
tract unIal his serial number had been
reached AT this rate a man with
number past so would proSaoly have to
wait forever before his time, as all in
the series before him had to pay their
10 per cent of the loan in, and every
other contract holder had had his time
to get a loan. They claim 1T was an
endless chain arrangement.
The victims, the government claims
extend as far as oregon. as they have
received letters from contract holders
fices in Virginia. Florida. Alabama
Georgia, Texas. Arkansas. Mississippi
and Oklahoma
II is claimed by the government Of
ficers that representatives would go into
community, and first get some promi-
nent man. and his name would be used
to work that section. A payment Of S.
would be made on issuing the contract,
so the government men say, which would
go into the pocket of the agents, and
not o nthe contract. In other words,
sort OF lnlLidLOn Zee dS OLc Oh the III
spectors said. Then s. month would
be paid, and the next three months went:
to the company. Then it was that the
contract holders had to wait for their
time to get a loan-
The government claims that the af-
fairs OF the company were investigated
in 1909, and action was suspended on the
promise of a revision of their methods.
Representing the four men under ar
rest are Napier. Wright & Cox and J.
Z. McCleIland.