The Richmond Virginian. (Richmond, Va.) 1910-1920, 1915-08-18

penBeN Af,u6Q,bne pSF"A'fN'"
I mt ereBt on
funded debt. 2.03f.sSo 9.sStloe
Rentals -: 47sss2 1.sSi,s51
Net income S.3O6.blS Suo,sio
Surplus. -. 10.2s3.tS4 6.2e4.20s
Mileage owned. S,i2s 1887
Mica psd op't'd ARA 1879
ANOTHER SCHEME
or HIGH FINANCE.
OF the receivership proceedings, the
commission says:
The syndicate decided TO put the
railway into a receivership. The gen
eral counsel of the railway company,
at the suggestion of w. II. Moore,
member of the syndicate. drew the bill
asking for receivership and engaged
an attorney ostensibly to represent the
other side. The bill was placed In the
hands OF this attorney with the name
of the complainant omitted. and he was
instructed by the general counsel tn
locate some creditor of the railway
company willing to act as complain
ant
There was an agreement between the
general counsel and this attorney as
to the parties the latter would recon-
mend 10 the court as receivers. the
general counsel agreeing 10 instruct
the attorney appearing for the rail-
way company to acquiesce In the
recommendations made.
The board of directors of the rail-
way company was not informed OF the
intention to file bill for receive-shfp,
and at no meeting of the board was
any authority ever given for suon
action Members of the board of d.
rectors not in the confidence of the
syndicate were kept in ignorance OF
the fact that such bill had been pre-
pared. The stockholders had no in
formation OF the purpose to put the
railway company into receivership.
although a stockholders meeting was
held after the date upon which the
rsceivership bill was completed by the
general counsel. and ts1is general coun-
sci attended the meeting. According
to the testimony the bill was COM
pleted by the general counsel March
20, 1915. and the fact that 1t Was to
be hled whenever desired by those In
authority was known only to certain
insiders The testimony clearly estah-
fishes the fact that the railway com,
pany could easily have paid the debt
of $4,000 upon which the receiver
ship application was based. and that
arrangements subsequently could have
been made to meet all pressing obi
cations of the railway company.
BROUGHT SUIT MERELY
TO OBfIGE DEBTOR
.sThe creditor at whose instance the
receivership application was filed APP
peared as complainant by request. r..
p. Lamont, the president of the
American steel Foundries, the COM
plainant, testified that he would not
have thought of bringing such a pro-
ceeding against the railway company
unless he had understood that 1t would
be regarded as not unfriendly, but as
a friendly act to oblige the railway
company. He only consented that
his company should appear as COM
plainant when he was assured that
this course was in accordance with
the wishes of the railway company.
and that his company was not TO have
any care or expense in the prepare
! ton of papers or payment Of counsel
/ fees. The suit was not bona tide
proceeding to collect a debt, but was
| instituted to carry out the purposes
and schemes of the syndicate con-
trolling the railway.
"N l.. Amster, who was elected to
| the board Of directors of the railway
| company by the minority stock holders
| at lttO hCttAuG iEbu AZ
Chicago. April IL, 1915, believing. &C.
cord;ng to mis- testimony. that no sin
cere effort was being made by other
members of the board to finance the
obligations of the railway, undertook
| to assist in raising about $4,000. 600
needed by the railway to meet obliga-
tons soon thereafter 10 mature. Or
April Is. 1915, he met and conferred
with Messrs. James Mclean anr
| Schumacher. all directors of the rail-
| way and members of the executive
committee. and discussed the COM
| panys finances. These three expressed
approval of his purpose to negotiate
! for the money. Amster testified he
had secured assurances for the furn,
ishing OF the money from responsible
! Boston bankers on securities whicf
the railway company had. When h,
arrived in New York on the morning
OF April 20 to report this fact, he went
to the Office OF the railway company
and quoting s1is testimony, could moi
find anybody there that would sa,
anything except a lot of people NOV.
ing back and forth. left the Office
and found on the ticker that the Rock
Island had been put in the hands OF q
receiver. This, Amster testified. YVES
the first information he had Of the
receivership Of the road, and after
the stockholders meeting in Chicago
April IL, travelled from Chicago tc
| New York with Robert Walker, the
| general counsel of the road.
SCHEME ALREADY
/ MATCHED WEEKS BEFORE
ut will be remembered that the
bill was completed by the genera
counsel on March %. this fact being
known only to Especial few. The bill
was fled April 20. The records o!
the New York stock market reveal
that the railway stock was inactive
until the day this bill was completed
March 30. Then the stock began to hs
largely dealt in and the price increased
from $40 to $39 a share. When the
bill was filed and receivers were ap.
pointed. the stock dropped from $3s
to $40 a share
1t is a forceful commentary on
the methods by which great railway
may be manipulated into receiver
ship when II is noted that the general
counsel, after drawing the bill for a
receivership, sold his stock, and the To-