Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1913-06-12
Interstate Commission Has
Begun A Searching
Inquiry.
ARE PECULIAR PHASES
Will Go Back to 1896; the Time
of the Reorganization of .gE
the System.

Washington, D. c., June I2.-
searching investigation into the fina
cial operations Of the st. Louis & SIS
Francisco railroad system, in RESPONSE
to a resolution of the senate, is to be
undertaken by the Interstate COM
merce commission at once. A reso-
luton directing the inquiry was intro
duced by Senator Kenyon and. passed
the senate Tuesday.
The inquiry will deal with all the
operations of the Frisco lines since the
reorganization of the system in 1896.
That will include it's relations with the
Rock Island, it's purchase of the Chi
cago & Eastern Illinois, with what are
regarded as peculiar phases of that
deal, and with the acquisition by the
Frisco of leased lines at rentals de-
clared by those familiar with them to
be extravagant and unwarranted.
PRELIMINARY WORK BEGUN.
The preliminary work of the inquiry
will be conducted by the division of
carriers accounts, acting by direction
of Commissioner Harlan, who is in
charge of that branch of the commits
sion's work. Agents of the division
began work in New York yesterday.
When the division of carriers ac-
counts work Is concluded a report will
be made to the commission of all facts,
following which the commission prob
ably will issue an order directing a
formal inquiry into the whole matter
of the Frisco's operations. Hearings
will be held and arguments heard. A
report will then be submitted to the
senate, with such comments and rec
concentrations as may be suggested by
the facts.
1t is probable the inquiry will be ex.
tended many months.
NEW PLAN PRESENTED
St Paul, Mimi, June 12.-Attorneys
| for the Union Pacific presented at the
opening of the merger dissolution
hearing today a new plan for the dis
position of the S3S,000,000 worth of
Soutl ern Pacific stock to the Pennsyl-
vania railroad in exchange for S21. .0G0,-
900 worth of Baltimore & Ohio stock.
The new plan proposed was supple
mental to two plans recently submit
| ted The amount of stock involved in
the exchange represents only IA per
cent of the total of Southern Pacific
stock Present holdings of the Union
Pacific in Southern Pacific common
stock represents 1926, 100000.
Attorney General McReynolds, in
opposing the plan proposed by the
Union Pacific. said he regretted the
railroads had been unable TO effect the
deal whereby the Union Pacific would
acquire the Central Pacific, operating
from Ogden to San Francisco, in ex-
change for it's Southern Pacific stock.
He declared this failure would COM
pei the government to institute eXpen-
sive litigation TO compel the Southern
Pacific to relinquish its hold over the
Central Pacific. The court adjourned
without announcing a decision.
Philadelphia, Pa, June 12.-Pennsyl.
vania railroad officials confirmed the
statement that an arrangement enter.
ed into for an exchange of the com.
pany's holdings of Baltimore & Ohio
stock for S3S,OOO,OOO worth or South
ern Pacific stock owned by the Union
Pacific, the exchange, II approved by
the court, TO be made on the basis OF
the relative market value of Baltimore
& Ohio and Southern Pacific stock. In
financial circles the deal Is looked up
on as a REIMBURSEMENT by the Pennsyl.
vania of all interest in the Baltimore
& Ohio.
SUIT AFFECTS STOCK.
Chicago, Ill. June 12.-Filing Of the
government antitrust suit against the
Quaker Oats company yesterday was
reflected today by sharp furry in
stocks of that company ON the local
stock exchange. an extreme decline OF
80 points being registered. The sell.
ing was said to have been mostly for
small investors.