New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-10-04
RID Of OIL BONDS BY
SELLING TO DIRECTORS
Banker Admits He Was Assured
of Ready Market Before He
Handled Big Issue.
ON STANDARD MANS WORD
Secretary Veit Asked if Trans
action Was Not Merely Trans
fer from One Subsidiary
to Another.

Edgar l.. MdTSlOl, u tile pdhhihs
firm of Blair & Co., Of No. "A Broad
street, was the star witness yesterday
at the hearing in the suit Of II. c.
Pierce to establish his contention that
the Standard Oil Company has not been
dissolved.
The banker said that in April he was
called on the telephone and asked to
come to No. 26 Broadway, where he
met H. C. Folger. jr,, president Of the
Standard Oil Company of New York,
and another man, whose name he de-
clined to disclose. The anonymous per-
son said the Standard Oil Company OF
New York desired to dispose of 5000
900 bonds Of the Security Oil Company
OF Texas. and implied that there would
be very little difficulty in getting rid OF
the bonds. They were first mortgage
bonds, the witness testified, and part
Of q $10,000.000 issue. Mr.. Marston
said he was told that about S3,OOO,oOO
of the same issue were held by the
Columbia Trust Company as security
for a loan Of S2,500,O00. Mr.. Marston
said that without making the usual In
vestigation he agreed to take the bonds
at eS.
The witness testified that he was
called on the telephone on April II
and informed that Jesup g. Lamont
brokers at No. &c Broadway, would
take $2,4OO,OO0 of the bonds at 9S15.
In less than four days after that l.. c.
Ledyard took 100000 at the same
price, and within a few days c. NJ
Pratt took $250,OO0 and G. w. Hark-
ness 100000, all at 9S1a.
Mr.. Marston was asked II he did not
know that Mr.. Hardness and Mr.. Pratt
were directors Of the Standard OIL
Company Of New Jersey and that Mr..
Ledyard was counsel for the Standard
Oil Company. Mr.. Marston smiled and
replied that he had read in the news
papers that such was the case.
Only S17,5oo Profit.
1T would appear that you made only
$1,000 in this transaction" said Sam
uel Untermyer. THAT is ridiculously
small margin. it is notT'
well, We usually make more than
that" admitted the banker.
Such a sum is hardly enough to
recompense your lawyers in such
deal, is it?" continued Mr.. Untermyer.
We'll, lawyers do come high" re-
sponded Mr.. Marston.
Then we may assume that the only
reason you undertook the transaction
was that you knew that the bonds
practically were sold before you bought
them?"
Il would not say that" said Mr..
Marston. cot course, 1 had pretty
good idea that would be able to find
a market for them"
Mr.. Untermyer's next question was
frank He said: IF you were buying
those bonds you would not have taken
them on the assurance Of some one
that they were right without having a
lawyer examine them, would your"
THAT is correct" said Mr.. Marston.
Then, Mr.. Marston, you simply acted
as a 'go-between' p
1T was q regular purchase and SALE"
said Mr.. Marston, but I would not
have entered into the transaction had 1
not received good assurance that 1
would find a market for the bonds"
did you take the word Of John D.
Archbold?"
NO." said Mr.. Marston; II would
rather not tell you who he was, but I
will say that he was one usually re-
ferred to as a leader in Standard OIL"
Competition In Brazil.
Richard G. Welt, secretary of the
Standard Oil Company Of New York.
admitted that the Standard Oil Com
pany bought oil from the security COM
pany. He did know the New York
company and the New Jersey company
competed for business. but he could not
say where. except that ne believed
there was competition in Brazil.
Changes in the holdings of New Jer
sey company directors in the stock Of
the New York company were as fol-
lows, the witness testified:
Shares Shares ut
nna ans