Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1914-07-13
HOLDERS OF STOCK
LOSE S60,000,0O0
IContim,ed from First Pagel

LContin,red from First Page1
improvident administration or the
New Haven as shown in this investiga-
ton are the Boston and Maine de-
spoilment; the iniquity of the West
Chester aquistion: the double price
paid for the Rhoade Island trolleys;
! the recklessness in the purchase of
Connesticut and Massachusetts, troll
| leys at prices exorbitantly in excess
of their market value; the unwarrant-
| ed expenditure of large amounts in
| educating public opinion; the dis
position. without knowledge of the di-
rectors. of hundreds of thousands of
dollars for influencing public senti-
ment; the habitual payment of un-
! itemiZed vouchers without any clear
specialization of details; the confus-
ing inter-relation of the principal COM
pany and its subsidiaries and conse-
quent complication of accounts; the
practice of financial legardemain In
issuing large blocks of New Haven
stocks for notes of the New England
Navigation Company and manipulat-
ing these, securities back and forth;
| fictitious sales of New Haven stock
to friendly parties with the design of
boosting the stock and unloading on
the public at the higher market
price: the unlawful diversion of cor
porte funds to political organizations;
the scattering of retainers to attor-
neys of five tates, who rendered no
itemized bills for services and who
conducted no litigation to which the
railroad was a party; extensive use of
paid lobby in the matters as to
which the directors claim to have no
information: the attempt to control
utterances of the press by subsidizing
reporters; payment of money and the
profiigate issue of free passes to legis-
lators and their friends; the invest
ment of 100000 in securities of New
England newspaper; the regular en-
ployment of political bosses in Rhode
sland and other States. not for the
purpose of having them perform my
service hut to prevent them, as Mr..
Mellen expressed it. from becoming
active o the other side: the retention
of John L. Billiard, of more than S2,-
700, 900 in a transaction in which he
represented the New Haven and into
which he invested not a dollar; the
inability of Oakleigh Thorne to ac-
count for S1.OS2,0 900 of the funds of
the New Haven intrusted to him in
carrying out the West Chester pro-
position: the story of Mr.. Mellen as to
the distribution of $1,000, 600 for cor
rupt purposes in bringing about
lamenments of the West Chester and
Port Chester franchises; the domina-
by Mr.. Morgan and Mr.. Mellen and
the absolute subordination of other
members of the board of directors to
the will of these two; the unwarrant-
ed increase of the New Haven LA
bilities from S93,000,000 in 1908 to
SAT-, 900, 900 in 1918; the increase in
floating notes from nothing in 1908
to approximately s4O,OO0.O00 in 1918;
the indefensible standard of business
ethics and the absence of financial
acumen displayed by eminent finan-
ciers in directing the destinies of this
railroad in its attempt to establish a
monopoly of the transportation of
New England. A combination of all
these has resulted in the present de-
plorable situation in which the affairs
o. THE railroad are involved.
Items Summarized
From the facts developed in this
investigation il would seem that there
is little question concerning the re-
covery of a substantial amount of the
stockholders money that has been
wasted. every items of this nature
will be briefly summarized:
"Overpaid Perry and Thorne in
commissions sS03,750.
Illegally spent in obtaining West
Chester franchise changes, S1,524,-
O72.77.
I'm the Billiard transaction S2,74S.-
zoo.
The money with which Billiard ac-
quired the 15,7655 additional shares
of common stock and 5,S26 shares of
preferred stock of the Boston and
Maine Railroad Company was furnish
ed by the New England Navigation
Company. This stock was turned
back to the navigation company for
S3,370,0S2. 1t wou.. seem that
suit by stockholders for the recovery
of the profit which is justly due the
navigation company If any was made
by Billiard in the transactions involving
these additional shares, could be
maintained.
Losses are Itemized
I'm attempting TO estimate the
losses of the New Haven stockholders
the three large items with which we
are confronted are those arising out
of the acquisition of the Boston and
Maine stock, the New York, West
Chester and Boston stock and the
Rhode Island trolleys
"A summary of the losses is as fol-
lows:
Boston and maine, s23,223, 1855.
New York, West Chester and Bos-
ton, S11.457,156.O9.
Hartford and Worcester Street
Railway. S73,394.27.
Springfield Railway Companies,
S1O9, pills.
Worcester Consolidated Street
Railway, S10,500.
Worcester and South Bridge Street
Railway, s15,5S0.
Connecticut Company, $685.
3S6.O1
Rhode Island Company, s1S,353,-
336.41.
Total, s65,S71. 1.2s9.61.
There was a loss in the recent sale
of the New Haven interests in the
Merchant and Miners Steamship Com
pany at 1854, 500"