New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-01-06
HAWTHORNE BUBBLES
| BURST OUT IN COURT
Five Indictments for Mining Pro-
motions Exploited Through
His Literary Ability.
WRITER HIMSELF IN NUMBER
Albert Freeman, considered
Head of Companies, and Josiah
Quincy, Twice Mayor of Bos-
ton. Named in Charges.


Tho Hawthorne mine bubbles burst
Yesterday. when Ave men most promi-
nentIv associated with the chain OF MIN
ing promotions exploited through TIE
literary ability of Julian Hawthorne ap-
peared before Judge Hough, in the
limited States District Court, to plead 10
Indictments charging them with using
the mails in schemes to defraud and
with conspiracy to commit an onence
AGAINST the United States.
The men indicted were Albert Free
man. a stock promoter Of many years
activity and reputed head of all the
enterprises concerned; Josiah Quincy
descendant Of one of the best known
Boston families, once Assistant Secre-
tary of State under Grover Cleveland
twice Mayor of Boston, and now mem
her Of the Transit Commission OF that
CITY. who has been counsel for all the
companies promoted; Julian hawthorne
the writer and journalist, son OF Ma
thaniel Hawthorne, who gave his name
and literary ability to advertise the
stocks: DR.. William J. Morton, well
known nerve specialist, of this city, ana
John McKinnon, secretary and treasurer
of all the enterprises
Francis L. Wellman, as counsel,
entered a plea of not guilty for all the
defendants, with leave to withdraw II on
Wednesday after reading the indict-
ments. Judge Hough fixed bail In Free
m rs case at $4,000 and at $lOOWO
ach for the other defendants. lie
bonds were furnished later in the day
The five indictments returned dealt
with the activity OF the defendants DUR
ing the period from 1908 to the present
time in selling stock in the mines OF the
Continental Syndicate controlling the
Temagami Cobalt Mines, Ltd; the Elk
Lake Cobalt Mines, Ltd; the Montreal
Cobalt Mines, Ltd; the Hawthorne Sill
yer and Iron Mines, Ltd, and the Julian
Hawthorne Company. The total amount
said to have been Melted was about 3d.
100000.
Difficulties Of Investigation.
Complaints from numerous investors
started an investigation into the Haw-
thorne enterprises last spring. w. w.
Dickson, chief postoffice inspector, as
signed Inspectors Kincaid, Reddy and
Mayhew to look into the matter, and
early in September the case was taken
before the grand jury by Claude A.
Thompson, Assistant United States At
torney. The investigation was made diff
ficult through the fact that each OF the
companies named held merely the stock
Of a Canadian company Of the same
name, which held title to the property.
Shortly before the investigation began
all officers of the New York companies
resigned and the books were removed to
Canada, with the exception of those Of
the two companies bearing HawthOrne's
name.
The investigation, it was said, disclosed
that Freeman was the genius behind the
scheme that assured tremendous sales of
practically worthless stock through the
Introduction of novel ideas into the get
noting many years ago. and being quite
ar adept at stirring advertising litera-
ture. had launched the King Solomon
Gold Mining Company, which had Josiah
Quincy among its directors; the United
Mining Company and others.
At the close of 1907 the old game
ceased TO draw sufficiently. II was then
that the new system was worked out
with the promotion of the Temagami
Cobalt Mines, Ltd. This mining claim
and all OF the succeeding ones were stu
ated near the famous Cobalt district that
had produced great wealth. The fact
that they lay far outside of the area en-
bracing the silver producing mines Of
the district some of them as far distant
as fifty miles, the indictments charged,
was carefully suppressed from the pub
lie.
With a property that could easily he
trumpet up as highly promising, the ad-
vertising campaign became of great
inheritance. Julian Hawthorne was
selected for his ability TO write glowing
descriptions, and the name Hawthorne"
was exploited later TO inspire conf
dence among investors. appearing On
each prospectus together with that cf
Josiah Quincy, as counsel. Invitations
TO invest were issued 10 the most intel
Iect1aI clientele that could be obtained.
The sucker list" was not one of the
well known variety. but was compiled
mainly from university catalogues and
from the alumni lists of Harvard, Yale,
Princeton and Columbia.
Hawthorne Started Campaign.
The campaign was started with the
notification Of a number OF booklets
written by Julian Hawthorne like the
"Secret of Solomon" and others, which
daoIt in a visionary manner with the
possibilities Of wealth through mining
enterprises. Virgin treasure dug out Of
IN, earth is clean treasure; it makes no
one DOOR and it makes the digger rich,
said Hawthorne in one Of the pampn-
Lot