The Wheeling intelligencer. [volume] (Wheeling, W. Va.) 1903-1961, 1915-08-18
ROCK ISLAND
tcOauaasd from rir.t P.x.)

az
the railway company OF more than
500 OO. 900.
In addition thereto II is TO be
noted that prior TO June 80. 1914.
the railway company paid TO imam
cial institutions. in connection with
the Issuance OF bonds commissions
a-ggregating more than 81. 500. 900 ana
suffered discounts OF more than yl1.-
600. 600"
Directors Allow Exploitation.
In a general criticism. The commits
sion says:
The property Of the railway COM
pany will be called upon for many
years to make up the drain upon its
resources resulting from transactions
outside the proper sphere in which
the stockholders had a right to sup
pose their moneys were invested This
record emphasizes the need OF raii-
way directors who actually direct.
There are too many passive directors
VINO acquiesce In what is being done
without knowledge and without in
~Vestigation. A director OF a railroad
Is a quastpublic official who oc-
cupies a position OF trust. A director
who submits blindly to the exploita
ton OF his company is a party TO its
undoing n he should be held re-
sponslble to the same extent as n
ne mad been a principal instead OF an
accessory before the TACT. The great
Ter his responsibility and the a
his dereliction.
The Clayton antitrust act. which
becomes effective October Is. 1916.
VIII make IL unlawful for any per
son M the IA H.. A.
IN Two or more competing corpora-
tons. n one II which has a canitaI
surplus. or undivided profits aggreRat.
ing more than 100000. but common
carriers are especially from
its application. II should be iust as
grave an ohense for an official OF a
railway to be faithless to his trust for
financial gain as II is for an elected
OFFICIAL OF the government TO betrav
MS trust Tor a money reward
Limit Stock Issuance.
u this case the need of soua lint
.allons on the issuance of stocks and
ponds by common carriers. whether
dlrectly or through holding ma
strated."
The commissions Investigation Of
the Rock Island began in April 1914 on
the commissiOn's own motion but fol.
lowed a request from the house com-
mitttee on interstate
stirred by resolutions introduced In
congress.
After pointing TO the fact that in
l9O2 the Rock Island was thriving lis
prospects promising. its stock selling
IN the world markets al more than
goo a share. the report saws that I'M
MA Inc EhnEna hnA MmHN-- -
mat the road is now in receivers
hands. although the evidence shows
the earnings OF the road were in 1914
the largest In its history.
In 1901. the report sets forth. Dan.
lei G. Reid. ". II. Moore. J. n.
Moore and W. q. Leeds
S2O.OOO.OOO Of the cOmpany's stock
leeds became president and Reid
chairman OF the executive committee
a syndicate was formed which pro.
cured the election OF r. J.. Hine.
George McMurtry and George r
Focgs. as directors. According IN
the report tbs syndicate controlled
the board through the d~irectorsbips
held by themselves and By those sub
lect To their wishes. In July. 1902
the syndicate organized two holding
companies. the Chicago. RoskTstand
and Pacific Railroad Of
Iowa. and the Rock Island mpa
Of View Jersey Practically all the
roads stockholders exchanged their
stock. depOsitinF about S71.OOO.OOO OF
the railway stock. while the par
value 81 The holding companies So
ouritios issued In exchange aggre.
. gated Sls1. 900. 900.
BY tho organization Of the two
holding companies. the report saws.
"tho syndicate. the members Of which
held but little more than one-fourth
~ the railway stock. sccurod control
OF and dominated the affairs Of this
transportation system.