Tulsa daily world. [volume] (Tulsa, Indian Territory [Okla.]) 1905-1919, 1914-07-14
millions ARE USED
like STAGE money
/. G. C. DENOUNCES NEW
HAVEN MANAGEMENT IN
REPORT TO SENATE
STOCKHOLDERS Hold SACK
Directors Criminally Liable and
Road Violates Sherman
Anti Trust Law.

AuIl- lTuSl Law
WASHINGTON, July 10 The story
Of the reckless profligate' financial
operations uf the New Haven railroad,
one of the most remarkable chapters
in the history of American railroad
and American finance, was revealed ln
part today by the Interstate Com
merce Commission in report To the
senate of its investigation OF ihat
road
1t told of millions used ike stage
morcy. Of corporations as paWns IN
a monster game with all New Eng
lands transportation as prize,
which the New Haven in the 10 years
lust passed went from the height OF
prosperity to the point whore dlNl-
dent has been passed where disSo-
luton suit is threatening and whore
criminal indictments Of many OF the
directors who figured in deals are at
le~-t ID possibility.
Lost Many Millions.
Hampcrcd by unwilling Witnesses
hy burned books and by all the mnHes
which lawyers invented TO cover the
tal assistance throughout this mNes-
I'm the progress toward mouopohZuon
Of New England transportation, lhe
New Haven stockholders nave lost
between S65,0OO.0O0 and $9o,OOO,OOO,
but little Of which they may recover
In return, the report said they have
on their hands properties which pay
no dividends which eat into the earn
lngs of the parent road, and whlch
win be burden on its capacity for
many wears to come.
OF the present directing head,
Chairman Howard Elliott and walker
ID Hines. special counsel the report
saws they have co-operated with the
commission and rendered II substan-
tial assistance throughout the inves-
tigdtion.'
Violate, sherman Law.
Tho New Haven combination,
reared by Charles S. Mcllen and ap-
proved by the late j. T. Morgan ana
William Rockefeller, the commission
Hnds TO be clearly in violation Of the
sherman antitrust act and a monop-
oly in practical control of transporla-
tion of five states
The commi ission's report is unusual
as regards the manner in which the
directors knew they were perfecting
an illegal combination and says that
the dream Of transportation mon
opolv was unsound and mischievous.
Did Nearly Everything.
The New Haven the commission
saws. employed dummy directors,
manipulated accounts. used question
able methods in increasing its own
stock. paid the dividends Of subsl-
diaries TO make showing. and used
many other devices to deceive stock
holders and the public. 1t dipped into
in d & |H
Governments" and made large cam
paien contributions to the two domi-
uant political parties, bought officials
and tried to distort public opinion.
All this It did, the commission says,
ITO carry out a scheme of private
transportation monopoly imperial In
It's scope"
"If these directors who were faith
less to their stewardship, were held
responsible In the courts and at the
bar of public opinion for their fail
ure to do those things they should
have done. the lessons to directors
who do not direct would be very salu-
tary," SAYS the report. Most Of the
directors of the New Haven accepted
their responsibility lightly. They
failed TO realize that their names gave
confidence to the public and that
their connection with the corporation
led the public to invest. When these
directors were negligent and serious
losses result thcrefrom, they were
guilty OF grave derellction OF duty
and a breach Of trust that was NOR
ally wrong and criminal In its fruits
Directors Are Criminals.
directors should be made individ-
uallr liable to civil and criminal laws
for the manner in which they dis
charge their trust. \ corporation car
be no better nor worse than those
who operate it, 1t should bc just as
grave a crime to plunder stockholders
or the public through a railroad cor
poration as it is personally to ROB al
Individual"
or all the millions lost to New
Haven stockholders the commission
estimate, that possibly SN,O00,OOO may
be recovered 10y proper action. ENi'
dencc in its possession tending to show
violations of the laws of New York
Massac achusctts ana Rhode Island has
been turned over to the proper oNecu
tivcs in those states. The department
of Justice has been furnished with ,
complete record Of the testimony Sc
cured hv the commission, but there
ia mo- federal statute under which th'
Government can aid the stockholdeil
i'm recovering any Of their losses :
suggestion Is made that any eNpendi
lures I'm violation Of the antitrust ac
were beyond the powers Of the direc
tors and raises the question o
whether the directors may not be helI
pcrsonally responsible to satisfy an!
losses which resulted.
Intcrlocking Dlrcctoratcs.
In its investigation the commission
found that the New Haven had S3'
subsidiary corporations many o
which served no purpose except 'al
evil one" The report. pointing on
that on the New Haven board wer'
representatives Of the Pennsylvanii
railroad. the New York Central, tn
United states steel corporation, tn
Standard oil company the Pullman
company and many other interests
saws that interlccking directorates o
this sort cannot be too strongly con
demned" This. II was suggested a
the capitol during the day probaOl
will have its effect upon the trus
legislation now before the senate. an
,,,.,. aud tho talk about leaving tn