The Sentinel=record., 1913-11-19
FORMER HEAD OF THE ROAD TELLS OF THE BUILDING OF
 SUBSIDIARY LINES.
AFTERWARDS BEING BOUGHT
By the Frisco at Figure the Inter state Commerce Commission ind- cates Netted the Builders an Unu. sual Profit.

St. Louis. Nov 1S.-The alleged l partnership of officials of the St. i Louis and San Francisco railroad in 1 syndicates that promoted small rail.
 roads which later were sold to the
 Frisco. was inquired into at the hear ing before Interstate Commerce Com. missioner Clark here today as to the causes of the present receiyership of the line.
 Benjamn r. YoaEum, chairman of the Frisco board of directors. when the road went into receiyership was the only witness. ID. E. Brown was examiner for the commission.
 The syndicates that built various subsidiary lines were promoted by the St. Louis Union Trust Company and in answer to many questions Mir Yoa- kum referred his interrogators to the records of the trust company.
 Among the subsidiary lines con cerning which questions were asked were the St. Louis and Oklahoma City, the Iberia and Northern, tine St. Louis, Oklahoma and Southern, and the St. Louis and Gulf. As to the Iberia and Northern syndicate. MT. Yoakum testified he transferred his interest in that road to the Frisco for what it cost him. plus per cent interest
 Mir. Brown said that the record showed $212,000 was paid to MT. Yoa- kum, who replied that if that were true it represented no profit over the 6 per cent interest, On several otaler roads Mir Yoallum could not remem. Der the profit. He said he had an interest in the St. Louis and Cult but did not remember whether his | profit was $3S,000 as Mir. Brown said the record indicated This record | as cited by Brown showed that Yoa- Rum investpd $75,00O and received $113000.
 Other syndicates concerning which Brown questioned the witness were the Oklahoma City and Western, in which, according to the records, the syndicate had made $369,e00 on an in- yestment of $2,097 ,000, and the Arkan- sas Valley and Western in which "a Frisco official without a voice in the acquisition of new lines," made $23,- 900 on an investment of $11S,00O. It was stated that 51 men were in the first syndicate and 61 in the second.
 On the St. Louis, Oklahoma and Southern, according to ,the record quoted by Brown, the promoters made $719,OOO.
 Mir. Yoakum gave his reasons for the receiyership as follows
 One--dhe failure of the road to sell Arizona and New Mexico lands for s6,00O,0O0 or $7,000,000 By this deal the Frisco hoped to get enough money to meet pressing obligations 1 Mr Yoakum testified that James ! Campbell of St Louis, a director of l the Frisco, and head of the North | American company, insisted on the land as collateral for loan which | the North American company had made to the Frisco. At the time the demand for the additional collateral was made MT. Yoakum said the loan had been reduced to s400000.
 Two-The loss sustained by the Frisco on an investment in Texas and Louisiana Pine lumber properties.
 Three-A loss of more than s150,- GOO on the ownership of the Chicago and Eastern Mlinois Thie owner ship extended over II years. The two roads have been severad under the receivership. Before the reeeiv. ership the Frisco failed in an effort to sell a half interest in the road
 Mir Yoakum explained the lumber deal at length. By this deal the Fris- co acquired a large interest in the Kirby Lumber Company of Texas He said:
 These were the days of combines and mergers. The Santa Fe and other roads had carried out such deals successfully. It was important to get control of the last big patch of pine timber in the United States. It was part of big plan to make the Mississippi valley the highway of a great traffic to the gulf Other rail roads had their eyes on the same op- portunity. Several things combined to prevent our success. If we had met success the reeeivership never ,wo,,ll kovn haan naoaScorN