The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1916-11-25
BY BLUE SKY LAW
Sharp Stock Statesmen Take Ad-
vantage of Kansas Statute.
Capitalize Operation Here, Says
Secretary of State BOtkin.
THOUSANDS SPENT ANNUALLY
Investing Public Not Familiar
With Working of the Law.
State Doesn't Approve Invest
mentS-Only the Legality.
THOUSANDS SPENT ANNUALLY

Sharp stock statesmen capitalize the
operation of the blue sky law and de-
ceivc hundreds of innocent investors
according to a statement today by J.
T. Botkin, secretary of state. Botklh
Is a member of the state charter
board. He has watched the opera
lions of the blue sky law and believes
its operation is used by many sales
men, to delude the public into the be-
lief that because a company mas
passed certain legal requirements. its
Investments have been sanctioned by
the state.
Thousands of dollars are spent an
nually by investors, Botkin believes,
because a smart salesman has cleverly
led the investor to believe that the Sc
curity has the states sanction and
approval The secretary of state be-
lieves the investing public is not fami-
liar with the state blue sky law Be-
cause of a wrong impression given by
stock statesmen many women and men
buy stock in concerns which are en-
tirely speculative in their nature.
These corporations, however, have
complied with the provisions of the
blue sky law and cannot be denied
the right to do business. Botkins points
out
Investors Are Deceived.
4 don't know how much money
the Kansas investors dig up every
year. on the story that a company's m
vestments have been approved by the
blue sky department" said Botkin.
MANY smart statesmen have deceived
investors by leading them to believe
that the state has actually approved
the investments they offer. They don't
tell the investor that story in so many
words. But it is the inference that is
given and nothing is further from the
truth.
The state doesn't approve the m
fa at
the blue sky department does is to de-
termine whether a company is doing
business in accordance with the pro-
visions laid down by law. The depart
ment regulates the selling campaigns
of stock companies and doubtless
saves thousands of dollars in expenses
to the company. Concerns which have
worthless propositions on their face.
are denied admission to the state. But
the speculative corporations viii III
come under provisions of the law have
in many instances taken advantage of
the opportunity to lead the public TO
believe their proposition is approved
by the state.
Selling Is Regulated.
I'm the case Cf the state charter
board, commissions to agents are
regulated and an investigation is
made as to The organization of the
company in conformity with state
sumo that the state gave an official
o. X. to an oil company. 1t is simply
gambling proposition whether oil be
found. If oil be discovered in suffi-
Gent quantities, very probably the in
weston will receive large dividends.
Otherwise his stock is not worth wall
paper rates The state departments
have merely required the oil company
not to eat up the receipts by paying
fabulous prices to agents and for ad-
vertising purposes and required the
company to come under provisions of
the state law"
Botkins Indictment of the blue sky
companies does not include all COM
panies, he stated, but is a condemna-
ton of a growing evil which leads
stock statesmen to deceive the in
weston.
why, just think" said the secre-
tary of state. IF the stock selling
concerns were not in the business
which the law regards as a hazardous
financial proposition and was pure
and above suspicion, it would never
be necessary to spply to the blue sky
department to sell stock. The fact
that the blue sky department approves
a stock selling plan is not an indorse-
ment of the company, but instead it
is an admission by the company that
its incorporation plan and investment
is of such a nature that the state re-
Quired an investigation to determine
whether it would pass inspection as 4
con- m, with ordinary chan ces to sue
ceed.'