The Madison daily leader. [volume] (Madison, S.D.) 1890-current, 1914-07-14
ROADS METHODS
HOTLY ATTACKED
Interstate Commission Re-
ports on New Haven.
LAW VIOLATION ALLEGED

Directors Pronounced Criminally NEG.
ligent and Attention of Prosecuting
Attorneys Is Directed to the Facts
Unearthed-Loss to Stockholders
Exceeds s6o,oOo,ooo.
Washington, July 14.-"One of the
most glaring instances OF maladmin.
istration revealed in all the history of
American railroading," is the inter.
state commerce commissions charac.
terization of it's findings in the inves.
tigation of New Haven railroad hnan.
cial affairs, reported to the senate.
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 are declared
to be criminally negligent.
Evidence pointing to violation of
law has been transmitted to district
attorneys in Massachusetts, Rhode Is
land and New York, and the federal
department of justice
"A reasonable estimate of the loss
to the New Haven by reason of waste
and mismanagement' says the report,
will emOunt to between 100000 600
and $90,000,00 Directors should he
individually liable to civil and Grim.
inal laws for the manner in which
they discharge their trust"
All Under MelIen's Rule.
All the commissions structures
were upon the management of theI
New Haven system under formerI
President MeIlen.
In justice to the present manage
ment, the commission says, it is only
fair to say that Chairman Howard
Elliott and Walker d. Hines, special
counsel, have co-operated with the
commission and rendered IT substan-
tial assistance throughout this inVes-
tigation."
John l.. Billiard and the Billiard COM
pany were merely agencies of the
New Haven; Billiard never used a dol
lar of his own money and burned his
books and papers. Ii was not the UNI
derstanding of the New Haven board
that he should take profits of more
than $2000,O0O.
All the assets of the Billiard COM
pany belong to New Haven stockhold-
ers and a suit by the railroad against
Billiard and those who participated in
the transactions should be maintain.
ed says the report.
Dummy corporations and their use,
whick the report says in the New
Haven was frequent, are condemned
in unmeasured terms.
Significant Facts Cited.
Marked features and significant
incidents in the loose, extravagant and
improyident administration of the |
finances of the New Haven as shown |
in this investigation are the Boston
and Maine despoilment; the Unequal |
ity of the Westchester acquisition; |
the double price paid for the Rhode /
Island trolleys; the recklessness n
the purchase of Connecticut and Mas |
sachusetts trolleys at prices exorbi- |
tantly in excess of their market val |
ue; the unwarranted expenditure of
large amounts in educating public |
opinion and the disposition, without l
knowledge of the directors, of hun
dreds of thousands of dollars for in
huencing public sentiment"
Continuing it's enumeration of sig |
nificant incidents" the report lists
"the habitual payment of unitemized i
vouchers without any clear specifica-l
ton of details; the practices of finan-
cial legerdemain in issuing large i
blocks of New Haven stocks for notes /
of the New England Navigation COM
pany, and manipulating these securi-
ties back and forth; fictitious sales |
of New Haven stock to friendly par
ties with the design of boosting the
stock and unloading on the public at |
the higher market price and the un-
lawful diversion of corporate funds
to political organizations"