Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1913-03-13
RECEIVER NAMED
FOR LOCAL FIRE
INSURANCE CO.
Sales Manager Exploited AS
sets of Cotton States Fire,
Charge Made to Court.

The Cotton States Fire Insurance
Company 912 Third National Bank
building, a local organization capital
lied in 1911 at 100000, was thrown
into the hands of a receiver by order of
Superior Judge Bell today on charges
made that the assets of the company
have been exploited for personal gain
by w. W. Crume, sales manager, and
his associates, the promoters.
Ben F. Perry. under 10000 bond as re-
ceiver. was named by the court to as
sumo charge of the company's affairs
until the case was heard on April 10.
Crume and his associates were re-
strained from interfering with the COM
pany's affairs until the case was set
tied.
The receivership suits were filed by
eight Atlanta Greeks, who had been in
duced to buy stock in the company.
The petitioners charged that the pro-
motors exploited the assets of the COM
pany for their personal benefit through
the sale of the stock, and now proposed
to cancel $4,000 worth of unpaid stock
subscription to the detriment of the
real stockholders.
State Has Acted.
The court was told that Insurance
Commissioner Wright recently had in
formed the officers and directors OF
the company that no more stock was
to be placed on the market. The state
authorities. the bill alleges, advised
that the affairs of the company be
! liquidated as soon as possible.
! The superior court petitioners told
Judge Bell that the directors of the
company had recently authorized the
cancellation of stock subscriptions IL
legally and bringing the company's &C
tual assets down to $4,000.
| The plaintiffs asserted that unless
the court interviewed that stock sub
scriptions for $4,000 would be can
celed. Under this arrangement, they
contend, the stockholders who actually
paid for stock would be left holding
the bag.
Not Charged With Fraud.
The petition stated that the officers
of the company were not charged with
! fraud. The plaintiff asserted that mis-
handling of the company's assets wal
directly traceable to CT-ume and tn,
promoters who sold the stock two TO
one and took Illegal commissions 70
the sale.
The petitioners seeking relief from tn
court are G. Ayers, George Gregory
Nick Poolos. NJ. E. Suluniam. Pet
Virgiotes, George Eikus, Stamatfs Vir'
giotes and lie Chotas, holders of $500
worth of capital stock.
w. w. Crume, formerly sales man
ager Of the Cotton States Fire lnsur'
ance Company. seems to be the bone
Of contention in the filing Of the re-
cetvership.
According to Robert P. Jones, OF
Jones & Chambers. who is legal ad-
wiser for the company. Crume came
! from indianapolis and received a con-
tract to act as promoter and sell the
stock at a commission Of 30 per cent.
Transferred Interest.
II is said that Crume then trans.
ferred his interest to the Kennesav
Finance Company, an institution which
is said to have closed its doors and
gone Northward since then, Crumt
himself having been out Of the city
for the past two months.
On August 10, 1912 the law pro-
hibiting promoters from receiving more
than ten per cent for such services was
passed, and It is said that the Kenne-
saw Finance Company continued reap.
ing it's 80 per cent until December 81
when it ceased operations.
J. ]. Murphy, who assumed charge
of the sales department after Crume''
departure, has done everything in his
power to bring matters to a norma