New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-06-07
$4,000 Paid in Six We'll.
to One of Men Indicted,
Says Employe
$685. 900 Loan Mad.
Lawyers Received S2l,0 oo !.
May; Bankruptcy Pro-
ceeding Is Opposed

Channels through which fund, A..
Emerson Motors Company hsy, a..
and dwindled during the las, few,
were revealed yesterday in ,e,,,.
by employees OF the company du,;,.
bankruptcy examination before r,..,
States Commissioner Gilchrist !, ~
Federal Building.
Mrs. J. l.. Sullivan, assistan, ,
tary and treasurer OF the Emersoo v.
tors Company and the Emerson r,,..
and Tractor Company, a subsidiary "a,
poration, was the principal witness
She testified that the latter cOruo,,.
tion had paid within the last six w...,
S30,000-three checks OF $4,000 each
to Nichols F. Wilson, engineer Of u.
methods used 20 induce "inyestor,- :,
buy Emerson stock and one OF 4.
fourteen men associated with the Eu,,.
son Motors Company indicted BY d,
Federal government on charges a,
using the mails to defraud. Mrs. su.
livan said she did not know why WI.
son received this money.
Subsequent to these payments, Nm
Sullivan testified, the Emerson Motor
Company loaned $4,000 to the Ene.
son Truck and Tractor Company, wh,.
in turn paid the money to the Fox
Tractor Company.
Didn't Know Why Loan Was Made
The witness did not know why thh
loan was made. The last named con.
pany's stock selling methods in trading
on the name of Ford--though the De-.
troit automobile manufacturer hi
nothing to do with the concern-wsn
described in detail by The Tribun. o,
March Is last.
Mrs. Sullivan testified also that dur.
ing May S2l 900 was paid TO five lss.
yers by the Emerson Motors COMPANY
ito prevent indictments being found
While these amounts were being
taken from the Golfers Of the Eneuo,
Motors Company, IN addition TO ne
salaries its officers continued 10 draw
hundreds of persons who failed to PROF;
by The Tribune's exposure O. Emer
son methods on November - last were
hopefully buying the companys stock,
and many or the 10000 stockholders
who had bought before were eagerly
waiting for the large dividends bh"'
fully predicted in Emerson advertise
ments. =,
Louis II. Moos and Abner s. Werblt
of 10 Cedar Street, counsel for ~
three stockholders who filed the bani
ruptcy petition, are hearing now iro,
the disillusioned Investors Scores o
letters are received in the lawyers o.
fees daily. They come from men an;
women, old and young; from boys and
working girls, who had believed in the
flush OF reading extravagant Emerson
claims chat they, by investing in Emer'
son stock, would profit largely, a.
shareholders in some other companies
doubtless have. through the msnuiset
ure of automobiles.
Bankruptcy Action Is Opposed
Bainbridgc Colby, counsel for TIE
Emerson Motors Company in tie erm'
inal and civil proceedings against H.
Yesterday asked Judge Manton, in ne
Federal District Court, TO dismiss me
bankruptcy petition. Mr.. Colby assert
ed in the motion papers that the three
petitioning creditors, being stoekhoia'
ers of the company, are not creditors
within the meaning OF the BANKRUPTCY
law. He asked also that the orcef az
pointing John p. Johnston receiver o.
vacated. A hearing on the motion VII
be held in the Federal Building this 81
ternoon.
Mr.. Werblin said yesterday that w
total assets Of the Emerson Mo,on
Company found TO date were the MEG
ston factory, which is mortgaged !"
1888. 600: its contents, and s52,s4iIs a.
posted in three Ulster County osnn.
The company puts its debts 81 ao0'
1000. ..
Robert c. Hupp. vice-prcsident o. ne
Emerson Motors Company, and NiliisI
Loom.s and Byron II. Riess, self-styls'
"invest,lent brokers'" who sold liner
son stock, were arraigned YESTERDAY p'
fore Federal Judge Howe. All en'ert,.
tentative pleas Of not guilty. LOOM,
was released IN $1,000 bail; Hupp any
Riess in $4,000 each. Their counsel
Terence J. McManus, viii have uh''
June % TO amend the pleas.