The Richmond Virginian. (Richmond, Va.) 1910-1920, 1912-12-14
American BanknoteC Comps
Benefit by Favoritism
of Stock Exchange
INTERVIEWER SHOWS
IN MONEY PROM
]. Pierpont Morgan Is Heal
Stakeholder in Engravin 3
Plant That Prints the
Listed Securities

the character of much OF the tx
Urging on the New York stock
change, obtained yesterday
Frank K Sturgis, a former pred
of that organization, these addse3
admissions were secured today IN
Rudolph Keppler, another x61
president. Mr.. Sturgis and oth1e
esses, by Samuel Untermyer. &C.,
for the house money trust inveoel
Ing committee:
/. That short selling" which 4
considerable part of the tranaaG1
on the exchange, Is gambling I'll
and simple.
2. That exchange members -
ally consider any kind Of m1nfr1
lions of stock legitimate as loE3
the commissions are paid o.
brokers.
g. That the New York stoch r
change clearing house acts solelSEs
Its members and merely in the Go
city of an auditing department.
A. That actual stock cerfiAcaA1
not used on the stock exchanges
that transfers are arranged BY c.
ing house tickets.
S. That favoritism OF the New TT
stock exchange for the Aml&l
Banknote company, In which y. H1
pont Morgan il a heavy st0ckhoA11
enables that engraving concerS1s
hold a monopoly on the engraxt117
listed securities, thereby reaplMf 87
profit OF $4,000 a day, or $T30,o4.9
year.
6. That the stock exchange O.
suits for damages because Il -
incorporated.
Reason For Disciplino.
Stursis said the members who
disciplined" for their particjpatt6SS
the Rock Island pool incurred tn
pleasure Of the governors. oUlAly
cause they split commissionnL
Asked about the moral asp4cf3
short selling. Sturgis replied 6oN
1T is not my business to urGe na
reforms upon the community. 81
The. hearing was adjourned ~
o'clock until Monday morning. III.
termyer leaving for New York. as
Keppler spared with Mr.. UmxG
myer for some time before no e61
be led to admit that gambling Co.
on the exchange. He declared
manipulations Of stocks was infre1
now. but said 1t was proper, a. III
as there was no COLLISION Il
legally conducted. and the corr
sions were paid" M
All witnesses bore down hart
the necessity Of payment OF cCa
sions. AZ
do you agree with the conC1n
of the Hughes commission that II
stantial part OF the transactio1
the stock exchange are g1mbll
suddenly demanded Mr.. Untats
II want a direct answer.
Somewhat Of Gambia. Sas33
Well" said Mr.. Keppler. ~
ingly. II would say that soma f
actions on the stock exchan9Hsx
somewhat Of gambling naturN
What do you think OF the
acter of cross sales?'' asked l1s
termyer.
II think them legitimate. 80
as there are no wash sales or x1
ed orders in the transactto1s8
pied Mr.. Keppler.
When asked what he knew
the curb market, Mr.. Keppa@
swered shortly that he knew ne
about 1t, whatever. His assgN
so abrupt that even his coun1o1ey
G. Milburn. smiled. S!s|
Mr.. Sturgis, recalled for err
tion, was more explicit vines
toned about the gambling e.
6At%h &ACA3H8o
"As q matter Of fact" -
Mr.. Untermyer, short selling
gambling. pure and simpla n
Yes. largely that" admitt6
Sturgis. s.
Mr.. Untermyer asked Mr.
| about the Hooking pool Of 1e41
| inquired II the two memho41
| pended after the breaking o. q
| had been suspended bOCotmn
| failed. q!
That was rot the rsanc1
Mr.. Sturgis. TT was becau
! wont into the transactions ahoN
| financial resources. The o&NG
members OF the pool did net @$
| and they got OF with q coMG
Speculation OF Hsulko9
Seeking to show that TIE
| total Of brokers' .comm11
twenty-five cents . share WN&
! nous Mr.. untermyer asked
gis II the brokers specuIn$G
extent OF one-half Of al til
Some firms have many -
explained Mr.. Sturgia. ~
s'ble to tell II they. are opars
themselves or for custom6ru
Continuing he said that IT,
about Ave hundred active hyM
the exchange daily. and ax
hundred and fifty nOuaGxS
about one hundred and
million shares II stock are ~
annually. A fair average ~
transactions would be 0mG
the trades were for priwAfA
Of the brokers and not tor 04
On such sales there were M
sicns.
Questsored about s'Dplik
sicns, Mr.. Sturgis enplaineA
were divisions annng m&N
wr~re regulated by the eIn3
The exchange. he satd IN Eol
thar questions. haA noth1nQ
short seilina. This O0u11
retarded. ~ said.
Mr.. Gturgts admitted
might ~ mseled 10 M6o
by the maslfpulattOn N
arfincial stimulation On
Lid 10 tell az the AU01x
! ipulatfcn. IN 110o. m S
Rock Island 1oat4Fu NH
clplin26 beenuqos W11Jo
buying - - lal