The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1915-04-24
Asks for Receiver
and That Officers
Be Enjoined From
Selling More Stock

One of the most astound-
ing cases of deliberate, will
full fraud and deceit, the
victims of which we're farm
ers elevators all over the
northwest, many of them in
North Dakota, promises to
result from the action that
was started in Fargo late
yesterday by Attorney Gen
eral Linde. Mr.. Linde ap-
peared before Judge Pollock
yesterday afternoon at 5
O'Clock and filed papers ask
ing for an order to show
cause why a receiver should
not be appointed for the
Equity Cooperative ex-
change and it's charter an
nulled. The petition furth-
er prays that the officials of
the company be enjoined
from soliciting stock sub
scription and consignments
of grain in North Dakota.
Judge Pollock set the date
for the hearing May Is, in
the district court of Cass
county.
The papers filed in this case bring
to light an astonishing condition OF
affairs. The complaint is supported
by an array of aff1davits to show how
the officers of the Equity exchange de-
liberately cheated and defrauded the
patrons. 1t is alleged, and affidavtts
and copies of the correspondence which
passed between the officials OF the
company are presented to prove the
allegations, that the officials Of the
company made false reports on sales
to clients, not occasionally but
HUNDREDS OF TIMES, pocketing
the difference between reported sales
and actual sales.
In one instance two cars Of flax were
shipped to Duluth and false return
was made to the shipper. In this one
instance the agent of the Equity COM
pany at Duluth wrote to LOTUS that
the profit made by this fraudulent
transaction had been credited to Lof-
tus' account. The profit amounted to
about $19O on these two cars of fax
The correspondence, included in the
evidence that is now on file in the office
Of the clerk of court of CaSs county
shows that this was deliberate
steal
This ts only one instance. There are
hundreds of similar cases.
The Double Commission Game.
The Equity Cooperative exchange
was organized to do away with the
much maligned "middle-man." The
papers on file in this case show that
about 1000 cars of grain consigned to
the Equity Cooperative exchange was
sold through the chamber of commerce
in MINNEAPOLIS and on hundreds oi
cars of this grain the shippers were
charged two commissions, and paio
not one middleman's profits but two
one to the chamber of commerce and
a second to the Equity exchange.
The Equity officials had two ways
of making sales, by which they poe
keted commissions at the expense OF
ly to the commission firm. but In lieu
OF paying the commission man the
usual one cent commission the Equity
officials had an arrangement with The
commission firm by which the com
mission firm bought the ear of gralr
at one cent below the market. The
commission man would then immedi'
ately sell the car on the chamber o!
commerce floor at the market price
and would thus make a cent bushel
the usual commission.
The Equity exchange would ther
report that they had sold the car o.
wheat at the price they received. and
cent commission. The shipper would
thus be paying two commissions.
Here is a specific instance, takeI
from among hundreds of such case!
that are cited in the papers filed il
the case:
Great Northern car No. 1os,446 wa,
shipped by the Equity Elevator
Trading Co. of Breckenridge, MINI. /
was loaded with wheat and consignt
to the Equity exchange. This car wa!
sold to r. J. Johnston Co., Of th,
Minneapolis chamber of commcrce oil
oct. 16, 1912, for IS cents a bushel
Johnstone Co. Immediately sold it OF
the floor of the exchange for. III!
cents a bushel. The Equity exchang,
reported this sale to the shipper a
7s cents and deduc.ed cent bushe
commission, netting the shipper q
cents a bushel, whereas had he con.
signed it directly to tombstone ant
company 1t would have netted him q
cents a bushel
Another Method.
Here is an illustration of another
method used by the Equity officials TO
betting a commission at the expens'
OF the shipper.
Great Northern car No. 101, JOG, thu
account of the sale of which is datet
Oct. 2. 1912, was reported to the ship
nars az sold for SO cents, but in tn,