Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1914-07-16
C[AFL|N ADMITS He
ALONE CAVE NOTES
On OUTSIDE STORES
As Sole Owner of Twenty-Seven
Concerns He Conferred Their
Offices Here and Issued
S31,600,000 Paper.

mitted yesterday that the S3l,G00,OO0 of
notes whose approach to maturity
brought about the rcceivcrship Of the
~ Is. Claflin company on June % were
issued by companies of which he was
the sole owner. He admitted further
thnt the financial affairs Of those
companies were taken care OF in New
York, and that tho men locally in charge
OF them had to 90 with nothing more
than their retail operations.
These admissions, which were made
over Mr. Claims own name I'm state
ment issued by his attorneys Could e
Wilkie, No. Wall Street threw a new
light on the failure which involved
liabilities Of between S3500o;0D0 and $40
COO 900 They established. among others,
these things:
That the twenty-sevcn stores making
up the retail chain of the Cladn COM
pany had only their executive officers
in the cities where they are located.
That the fiscal officers Of all of them
were in New York. where their books
were kent, excepting only those having
to do with merchandise accounts.
That the notes drawn in the names of
these stores bore date of New York,
where they were payable, as the official
That notes In great amounts We're
drawn in the names of these stores,
and that in some instances it was not
known to the officers Of these stores
and that the notes were outstanding UNI
I'll the rcceivership brought them to
light.
That the stores. whose annual bust
ness was in excess of $100.00o.00O
were conducted not as distinct cstab-
lishments but as retail branches of
the II. b. Clanin company. and that
the enormous volume Of credit lnvolv-
cd by the chain was controlled in
New York.
BUTTE STORES EXPERIENCE.
Mr.. Claims statement followed
the publication IN last nights edition
Of the Wall street journal of testi-
n1ony brought out before Judge John
d. McClernan in Butte Mont when
application was made for Il receiver
for the Honnossey company of Butte,
and Copper City Commercial company
of Anaconda. Mont. The Hennessy
corporation is one of the companies
owned by Mr. Clanin.
Charles j. Kelly, president of the
corporation. testified that he applied
.oi '' ''
o' anu '''i' nv 'IU
Nv" ''.' ''i i,o' "t'''i o"'" ""' ''''
WV "ii''' o'!'i0 '''iI !" mn,
from "ahk III 81 faul tha' II hclu
tne corporation note lor $0'ooo'
l"'"' ne S'l"' ne io"hu 'H"t h"'os
aSEreEatihG $l'o'o'u"o W"f" outs'ahu-
ing against the corporation
Inc NaII street journal added that
N'Il'N testimony lolI"W"a 'IoseN
statement ne made to the Butte DAILY
l'ost on july l. Immediately after the re-
ceiNerShlp proceedings We're started. in
TINS statement NeIIy said;
me HennessY corporation mas never
had any indebtedness to speak Of At the
present tim" our debts are about $4,000, |
received a telegram from New York last
Friday 'June 20 advising me of the dill
cuIties OF the Clailin interests, who own
the Hennossy business. they suggested
n receiVersh'p Tor the business. wired
pack to New York that the Hennessy cor
,oration had no debts to speak of, and
mat II had tremendous assets.
WHERE THE MONEY WENT
ct had M trou,,odoo of any. indab+od-
ness being contracted bv the CIafin inter-
ests in the name of the Hennessy cor
poration until Monday or this week CJune
10 Wheh got notice by letter from
pank holdlnS note Tor "'oJ
was Two days getting positive IN
FORMATION from New YORK Yesterday
Drought Woro that the treasurer or the
iennessF corporation VINO nVes in New
forA, hau hesota'ec s4'o'""o III notes 81
the iehh"SsS corporation. lhdorSed ny
the II. h. Claiun company, which notes
"ers sold IL the market presumably 10
innocent hoiders tor cash ana the money
tsed by the GlGihn interests.
ne news cane TO ne hk" bolt from
cieeI SKY Thc Clal'n lntercsts Owned
III the STOCK 81 the H'AhcSSY corporation,
IL was tkelr onnHens' they chose to
nave tho treasurer In New York, ard
lttie dn@imed that 1uch an arrangement
"ou'd result as 1t mas.
Any ara all or these notes pat out in
Ne" f"rr VIII nave 10 De paid. There Is
H't'uhR !'It Iot me TO DO nut try and
preserve tho business for the benefit Of
'', ~
tIo, ,yhosa corIt,l stocl, ,s a. ~, nni AZ,
n hu.,nes. NJ 60 OOo O.no q ,,oo, II g.. So.
xtores fIa ans ,ts .ss.t- -, 60 roo 100
'ii" Ni'Ap LIN = @i''l f'M HNI
Upon the punllcation of this statement
Mr. Claftn Issued MS statement IT read
as follows
Each of these companies was financed
In New York ard the local officials of
nh. l.1