Manchester Democrat. [volume] (Manchester, Iowa) 1875-1930, 1914-07-22
80 M%|LL|0N.S70LEh.
INTERSTATE COMMERCE COM
MISSION 1AREs LOOT OF NEW
HAVEN ROAD.
BLAME PUT ON IN DIRECTORS.

a#--- 49, ~ &tAg *
BLAME PUT ON DIRECTORS
Federal Body Calls Financing Of East
ern Railway Ono OF the. Most Gisf.
Ino Instances Of MaiadmlnlstratIon
In History d Nations Rallroading.
Washington. July 15.-"One OF the
most glazing instances OF maladmints.E
tration, revealed in all the history OF
American railroading," is the inter.
state commerce commissions charac-
t%erization OF its findings in the inves7+t
legations OF New Haven railroad fnan-I
cial affairs, reported to the senate on
Monday.
In a report Of 10000 words. prob
ably the most drastic in terms Of any
ever made by the commission, the
New Haven's directors were pro
nounced ".criminally negligent"
Evidence pointing to violation OF
law has been transmitted to district
attorneys In Massachusetts,, RhodesIs-
6uV duO FANGW ~ VI IA 0A0 ~ ~
department Of Justice.
The report, moreover will be made
the basis Of proceedings by stock
holders to recover millions OF dollars
alleged to have been wasted BY the
management.
IA reasonable estimate OF the loss
to the New Haven by reason of waste
and mismanagement," says, the report.
will amount to between sixty and
ninety million dollars. Directors
should be made individually liable to
civil and criminal laws for the man
ner in which they discharge their
trust" E5qS 80
All the commissions structures
were upon the management Of the
New Haven system under former Pres
ident Mellen. A
The report cites these Significant
Incidents"
Marked features and significant In
cidents In the loose. extravagant and
improvident administration OF the
finances of the New Haven, as shown
in this investigation. are; /
oOSIOu q MAIuc UcSHOAAAAOuI ~ "a .gFr
Inequity Of the West Chester acquisi-
/, ton. s$
Recklessness in the purchase OF Com
necticut and Massachusetts trolleys
1t prices exorbitantly in excess Of
their market value. u ssss i s$S
Unwarranted expenditure OF large
amounts In educating public opin-3
ion.
Disposition. without knowledge Of the
directors, OF hundreds sof thousands
OF dollars for influencing public
sentiment.
Fictitious sales Of New Haven stock
to friendly parties with the design
OF boosting the stocks and unload
ing on the public at the higher
""markettprice."
Unlawful diversion Of corporate funds
to political organizations.
Extensive use OF q paid lobby In the
matters as to which the directors
claim to have no information.
Attempt to control u%tterances Of the
press by %subsidizing reporters.
Payment OF money and the profigates
HI A6oO0 VI AA00 P0oo0o = AS6
and their friends.
Investment OF $4OO. 900 In securities OF
New England newspaper.
Regular employment OF political bosses
In Rhode Island and other states. not
for the purpose Of having them per
form any service but to prevent
them; as Mr.. Mellen expresses it,
from becoming active on the other
side"
Retention by John u Billiard of more
than $1,000, 900 In Q transaction in
which he represented the New Ha-B
ven and In which he invested not .
dollar. #Sl
Inability OF Oakleigh Thorne to ac-
count for $1.032, 900 ofSthe funds Of
the New Hayentntrusted to him in
carrying out of the West Chester
proposition. III
Story OF Mr.. Mellens 40 to the distribu-
ton Of $1,2oO.0oO for corrupt pur-
poses in bringing about amendments
of the West Chester and Port Ches-
ter franchises.
Domination OF all the Affairs Of this
railroad by Mr.. Morgan and Mr.. Mel.
len. and the absolute subordination
Of other members Of the board Of d..
rectors to the will OF these two.
Unwarranted increase of the New Ha.
ven liabilities from $93. 100000. In
1908 to $417. O00. 900 In 1913.
Increase in floating notes from moth.
ing in 1908 to approximately $40.
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