The Detroit times., 1914-07-14

"The Mestchester deal il a story
Of the prohigRte wnstc Of corporate
| funds"
"The Rhode Island troIIeys pue-
chase was another instance OF NIT
! Hons wasted"
steamship lines were acquired
coNertIy and ny devious methods."
! The Mellen- Morgan II ocketeiies
| management Of the Boston and
Maine "begun In illeEnlity and In n
lust for extended monopoly and has
! resulted In great depreciation aud
serious impairment OF credit"
NEW YORK, July 13.-The New
York, New Haven and Hartford
railroad will make no statement
relative TO the report Of the inter
state commerce commission, until
after an Official copy of the report
is received and placed before the
board Of directors. This announce.
ment was made this afternoon
from the office of President Eus-
tbs, acting chairman OF the New
Haven company. in the absence Of
Chairman Elliott, who is away on
leave Of absence.
BOSTON,. Mass, July 13.-Pre-
liminaries 70 the restitution
suit" threatened by stockholders
Of the New Haven railroad, we're
completed this afternoon with the
sending Of letter by the law firm
OF WhppIe, Sears and Ogden TO
directors Of the road, asking them
10 enforce the liability ot former
directors for $e4,ooOo 900 OF the
roads funds wasted on one count,
and s155, 100000 wasted under an
other Interpretation.
WASHINGTON. July 10 That the
monopoly theory OF the New Haven
road was unsound and mischievous,
that its directors were "criminally
Negligent" and thar substantial part
Of the stockholders money wasted
can be recovered, was the gist OF the
interstate commerce commission re.
port today to the senate on the New
Haven investigation. The report is
regarded as the most condemnatory
document ever issued by the inter
state commerce commission.
The commission declares the New
Haven directors consciously violated
Lut ltutIdi dHNAHlOhOHOlg Ia
No attempt was made TO fix the re-
sponsibihty for the New Haven
as between President
Melen and j. p Morgan, but the re.
port condemned the control gen.
orally.
1t is up TO the department OF JUS.
tice 10 act upon the commission S
findings that the New Haven direct
ors were criminally responsible In the
New Haven transactions, an inter.
state commerce commission official
stated Chief Counsel Joseph Folk,
who conducted the New Haven in
quiry, said that the report made the
directors directly responsible for
more than SGT 900 900 The total loss
10 the New Haven stockholders
mismanagement and careless
ness is somewhere between 100000.
900 and s90,OO0,000. the commission
estimates
The commission put the matter
squarely up TO the department OF JUS.
tice for action by furnishing IL with
a complete record OF the testimony.
THE result OF our research into the
OF the New Haven sys-
tenn has been TO disclose one of the
most glazing instances OF maladmin-
istratien revealed in all the history Of
American railroading," the report
reads.
in the course OF the investigation
made instances were uncovered Of
OF the laws OF different
states. AS they are not directly per.
tinent 10 our inquiry under the sen
ate resolution we could not follow
them into their details AS pointing
20 violations OF state laws, we have
turned over the evidence concerning
local occurrences I'm New York city
to the district attorney for the proper
district and the testimony relating
10 irregularities in Massachusetts, and
Rhode Island have been laid before
the proper authorities in those states.
The commission. also furnished the
department OF justice with com
plete copy OF the testimony"
In arraigning the directors the com.
said:
"Tf these directors who we're faith
less 10 their stewardship were held
in the courts and at the
bar OF public opinion for the failure
70 do these things they should have
done, the lesson 90 directors who do
not direct would be very salutary"
That the directors should be held
responsible for the Westchester.
steamship, Rhode Island, Connecticut,
and Massachusetts trolleys and other
was declared.
Testimony OF high finance" was
cited as follows:
Marked features and significant
incidents in the loose. extravagant,
and lmprovident admiDisjrasi 81 OF the
finances OF the New Haven as shown
in this investigation are the Boston &
Maine despoilment; the iniquity OF