New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-08-09
ORGANIZE TO PROTECT
INVESTORS IN STOCKS
Prominent Banking Houses
Throughout Country Repre-
sented at Conference Here.
FOR UNIFORMITY IN LAWS
National Bureau Of Investiga'
tion Into All Promotion En-
terprises Urged to Les
sen Impositions.

An organization designed primarily for
the protection Of the investing public was
launched Yesterday at the Weldorf-As-
toria BY representatives. Of several hum
dred OF the leading investment houses OF
the country 20 be known as the Invest
ment Bankers Association. Among It's
leading aims are efforts to secure greater
uniformity and control by the Individual
states In the laws governing the Issue OF
securities and concerted action TO stamp
out frauds perpetrated upon the investing
public.
The initiative for the formation OF the
organization came from leading invest
ment banking houses In New York and
Chicago, which perceived the need OF
better protection not only Of the invest
Ing public but OF the investment brokers
who, as a result OF limited facilities for
the Investigation OF various enterprise.
in the launching OF which they had he.
come interested. had been deceived as
much as the public, whose money they
tried 20 attract 10 the proposition.
Among the New York houses which
were the Guaranty Trust Company. Kuhn
Loeb & Co. Spencer Track & Co, Red.
mond & Co. Kount2e Brother, Hal.
sey & Co.. II. p. Hollins Co.
W. F. Hutton & Co. Knauth, Nachod
kuhne, l.. Barnum & Co, J. A. Clark
Co.. Callaway Fish & Co, the Hartman
National Bank. A. D. Converse & Co., A.
~ II q
and William A. Read & Co.
Close Cooperation Urged.
George r. Caldwell, vice-president OF
the Continental Trust and Savings Bank
Of Chicago, was elected permanent chair.
man OF the convention. and he delivered
the opening address, outlining the pur.
poses OF the organization. After pointing
out the many features Of the business
investment banks highly desirable Mr.
Caldwell said in part:
Annually new forms Of secured credits
aggregating 81 so. 10000 are analyZed, APP
proved, created and distributed by the
investment bankers. This, in itself, is
no small responsibility, especially az the
form OF credit In which We deal usually
extends over a period OF from five 10
nifty years, and must, therefore. not only
be safeguarded for the present, but until
the date OF maturity. AS now carried on.
the bulk OF this business Is done by less
than two thousand banking houses though
the number is annually increasing.
AS TO our purpose. one particular ac-
tivity from which we could reasonably
hope for good results would be the Sc
curing of greater uniformity in state laws
governing the issuance OF municipal Sc
curiues; likewise the Standardization OF
laws OF the various states creating public
service commissions and the issuing OF
public service securities. We must deal
to-day with many conditions where states
make municipal bonds tax exempt, no two
Of which are alike: also many laws gov
erninB the issuing OF special assessment
bonds. drainage bonds. levee and reclarna-
ton bonds, road bonds issued BY dis
tricts. municipal and irrigation bonds and
various conditions regarding the debt
limit and power TO levy and collect taxes
which now are at great variance. Then
We have to-day che conflict OF the laws
OF the states that have created public
service commissions.
There IS to-day "A conflict of the laws
OF the states and those OF the federal
government regarding conservation and
control OF water powers, and until settled
the development Of hydro electric prop
critics will be greatly retarded. There
IS also the question OF federal corpora
ton law: at present business initiative
IL greatly hampered by the multiplicity
OF laws governing interstate corporations.
Federal law providing for national In
corporation, making interstate corpora
tions subject TO uniform requirements,
with annual reports to be accompanied
by a sworn statement. subject 10 inves-
tigation by a federal bureau, IL is sug-
gested would greatly improve the quality
of our Industrial securities and avoid
much expense and confusion.