New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-06-22
ALLEGED SW|NOLERS HELD
Said to Have Made millions in
Mexican Lumber Scheme.
INVESTORS NUMBER $4,000
Money Came So Fast 81, 500
900 Was Paid in Dividends,
Postal Inspector Says.

Philadelphia. Juno 2I.-Charged with
conspiracy 10 Use the mails TO d"fraud
four officers Of tho International Lumber
and Development Company were arrested
hero to-day. while two other officials wer'
taken into custody in Chicago Those ar
rested here were held in $4,000 bail Tor
trial by United states Commissioner
They are Albert g. stuart. a director OF
the company: Charles &. Mcmahon, sccro-
tary AMI treasurer. Alfred WanamaEor
attorney for the corporation, and william
H. Armstrong, ir., director. Postal m
SDectors said that John Il. Markley an"
Isaiah Miller officials Of the company ar
rested in Chicago, were each held in $1,000
bail.
II is charged that the company ana it,
officials claimed II owned valuable lumber
lands in Mexico and that they misrop'"'
scented conditions through the mails to pur'
chasers Of stock The company is said t.
have sold $1,000 900 Of stock TO about l".'o'
investors all over the country.
Some time ago Philadelphia stockholders
Of the company instituted proceedings Ia
the United States Court for receiver Tho
suit was not concluded, because II wae
decided I'm the Delaware courts The com
pany has Delaware charter. In the mean
time the company was called to the aitcn-
ton Of the postal inspectors. and II is stat
cd that after an investigation in Mexico and
this country the arrests were decided uron
According to Postonico Inspector Cortel-
YOU. il IS the old story OF a beautiful pro
spectus and alluring advertisements. hut
differing from most swindle3 in Tat tho
corporation actually owned 2SS,oo0 acres OF
land in Mexico. The inspector says tho
corporation was run for the benefit Of the
officers, just as If there were no stock
holders The stockholders got dividend
occasionally. hut these dividends were paid
out OF stock subscriptions
II is charged that Markley and Miller
purchased $500 acres Of inaccessible land
for $4,000, Immediately formed tho Inter
rational Lumber and Development Com
rapv and resold the land 80 It and rs
stockholders for i6o0o0 That was the M
cleus ~ tho alleged swiudlc. according e
Nj Cortelvuu The tangled condition of
tho books is said 20 show that some per
son on the inside Of the corporation got
at least S'oo"oo as salary, expense and
fees
Following the mailing Of IN" prospectus
which declared that tho officers would aC.
ccrt 10 salaries. money hogan n roll into
the Offices Of tho concern, ~ the DrcNc
Building.
n was necessary 70 make az many "a
twenty trips a day 10 the Fostolice to
empty the large mail drawer. The money
came in so fast that In the first two years
Of its existence the corporation actually
paid 81 10000 w dividends, the government
agents declare, from the stock suhscrip-
tions.
When the bank account became 80 lars
that it began 10 arouse the suspicious of
tho financial Institutions Of tho city, tho
government investigators charge, Mork.'y
and Miller made contracts between ~,
corporation and themselves In which tho
corporation agreed 70 paw them 5000"
for developing the land in Mexico. Later
supplemental contract was made by whici
Mark'ay and Miller were 20 be paid 81
an acre Tor every acre Of Oh" $500 'n''
cleared planted and developed.
u IS also charged that Markloy, Miller
and the other officers OF the corporation
collected $4,000 for themselves, ~ whict
they made no accounting.