Evening star., 1915-06-02
TW0LOAN CONCERNS
ORDERED TOQU|T
Corporation Counsel Syme
Finds They Violate Spirit if
Not Letter of Law.
COMPANIES MANAGED
BY MAX E. GOLDMAN
One Other Under Investigation, and
Police Asked to Make Arrests
When Necessary.

Following disclosures made through
The Star by the citizens committee of
the Monday Evening Club. supple
mented by Investigations by head
quarters detectives. the District gov
ernment today, at the instigation of
Corporation Counsel Conrad H. Syme.
directed two loan companies to close
their doors on the grounds that their
methods were contrary to the spirit If
not the letter of the law regarding the
loaning of money in the District.
The concerns affected are the Citi-
zens' Loan Company. located at s27 F
Loan Company. at 500 F street north
west Both are conducted by Max E.
Goldman as manager.
This absolutely cleans up the loan
shark situation in the District with
the exception of a single company
which is now under investigation. Mr..
Syme said Outstanding loans of the
companies are Cancelled and will not
be collected
ANY attempt on the part Of any one
these companies, declared Mr.. Syme,
should be Immediately reported to the
corporation counsels Office
The corporation counsel stated that his
attention had been called to the methods
of these companies in collecting old loans
and in making what was called new 6
per cent loans. and that a system of
dunning was enforced which was ex-
tremely Objectionable, If not positively
illegal
Mr.. Syme's Statement.
with the assistance Of Information
which had been collected by W. H. Bald
win. chairman of the citizens committee,
and Louis Gutenberg, its attorney, I
make complete Investigations Of the meth
DDS Of these companies" he continued
''Whether the methods of making
not. there was no question in my mind
that they were absolutely contrary to
the spirit of the law and the under
standing Of the stipulation which had
been entered into with the loan COM
panies under which they had submitted
to forfeiture of % per cent of the
principal and all of the interest on
loans which had been made in viola
ton of law. These companies have
therefore been compelled to close their
doors and cease all business in the
District of Columbia.
with a single exception, the with
drawal of these companies from the
District of Columbia and the closing
OF their doors marks the ceasing of
this business in the District. I under
stand one other company is still col
lecting some old loans. am having
an investigation of this company made
TO ascertain it's methods and proper
action will be taken as soon as definite
information is at hand"
Mr Syme said that he would ask the
commissioners to issue instructions to
the police to Immediately arrest any
person who attempted to collect any
old loans made by these companies and
that he might ask to have one phase
OF the matter placed before the grand
jury for its investigation II any fur
ther attempt was made to eyade the
law by parties outside the District
Loan Shark Troubles.
The loan shark" problem has given
the Commissioners and the corporation
counsels office great deal of concern
ever since the so-called loan shark"
law became effective March s, 1913
Recent publications in The Star con-
cerning alleged violations of the law
were the subject Of frequent confer
ences between Corporation Counsel
Syme. Commissioner Newman and rep
resentatives of the citizens committee.
AT the time the law went into effect
forty-one companies were in operation.
| Prosecutions for alleged illegal loans
were brought in Police Court and car
| ried to the Court of Appeals. where the
validity of the law was upheld
Following this decision evidence was
secured in hundreds Of cases Of al
legged violation of the law, and a
wholesale clearing up of the situation
| commenced. The result of this activity
was that all those informed against
| pleaded guilty, under stipulation en-
| tered into with the corporation coun-
| sells Office that they should pay a fine
| OF $500, and that a Jail sentence Of
thirty days should be imposed upon
| each, but should stand suspended, pro-
4 ~ I'D lou
u also was stipulated In this agree
| ment that upon application of the bor-
rover there should be refunded all
| usurious interest collected since the
| law went into effect. and rs per cent
| Of the actual loan should be accepted
| In cases where payment had not been
made.
After this agreement was reached the
corporation counsePs office was be-
| sieged with persons seeking relief from
uSurlouh loans. Each case was given
| individual attention by the ASSISTANTS
| 10 the corporation counsel. assisted by
| an accountant assigned from the audi
| tors Office
| The amount of the refund due in each
Individual Instance was ascertained az
also was the amount, if any. payabIe
| under the stipulation. In this way he
4 tween 1000 and 5000 victims OF the
1 loan sharks were relieved without
| cost to themselves. and between $40. 0Ol
| and $4O,00O was caused to be refunded
| TO them.
/ Many Quit Business.
| with settlement of outstanding ac-
counts under this agreement com
| pleted. many companies> voluntariI,
went out of business until. at present
but one remains. according to the in.
yestigation just made by direction o,
the corporation counsel
The principal complaint against the
! methods OF some of the companies tha,
continued in business was that in max
ing new notes the compa MES insist ed