New-York tribune., 1918-05-24
Charges Emerson Money Was Used
To Preuent Prosecution in Boston

automobile stocks. They called at the
later's office in the Marbridge Build
ing. Finally meeting was arranged
| with Nichols F. Wilson, at which
Campbell and Hupp stated their pro-
ject, and the prosecutor charged, the
scheme of manipulation which is fin
, ally being assayed in the United States
District Court, forthwith began to be
hatched
According to the governments state
| ment, it seems that Wilson took the
lead from the start.
"Mr. Wilson," said the prosecuting
attorney, "asked Hupp and Campbell
how much capital they thought would
be needed to finance a company that
would, produce such car as they had
in mind. They replied that they thought
about $3,000,00O Mr.. Wilson replied
that he felt this was too large an
amount.
AT this point, though, he suggested
that car which would sell at around
four hundred dollars, to compete with
the Ford. offered big field, and, bring
ing in for the first time the name Of
Nthe defendant Emerson, added that he
| believed he might be able to interest
Mr.. Emerson in such a project. He
suggested that Mr.. Hupp and Mr.
Campbell prepare estimates along this
line.
"And then." went on Mr.. Osborne.
"Mr. Campbell and Mr.. Hupp returned
to the Hotel Marlborough, where they
were stopping, and overnight-over-
night, gentlemen, with nothing but Mr.,
Wilson's suggestion to go upon-pre-
pared figures and estimates of a car
to pc sold at 1895 and 20 net $50 profit"
After that conference succeeded CON
\ IT,
and fast, the prosecutor said. Mr.. Os-
borne told that. as set forth in The
Tribune in October, 1916, a company
was formed, capitalized at $4,000 600
and the stock divided into two blocks
$3,O0O,000 preferred and $1,000, 1000 com.
mon; how $3,000,000 worth of the lat.
ter was reserved for themselves by the
promoters. who up to this point had
not invested dollar of their own, and
that on April 10, Wilson, Hupp, Camp
bell and Emerson signed two agree.
ments whereby they bound themselves
to hold this stock as a unit for g
period Of three years.
Then, apparently, according to the
prosecution, it occurred to some one
of the men who were bent upon revo.
lutionizing the automobile world chat
it might be a good idea to nave g
demonstration car to help the stock
sales along
o.l 1T - had !" ..b been s suggested" said Mr.
contribute $4,000 toward this; but Mr.
Wilson suggested that instead $50 00C
Eof the extra 100000 worth of shares
that had been set aside by the pro-
moters be sold to the public so as to
net the company 81 per share.
"These shares were put on sale on
April 20 at $3.50 per share. In order
to help market them a statement was
prepared signed by Campbell and Hupp
and dictated in part by Emerson. And
this statement, gentlemen. formed the
by the Emerson Motors Company"
Round this sudden stock k-selling
drive, induced primarily to provide q
demonstration car, it was stated, there
speedily developed an intricate net
work of sales agencies. Chicago
Omaha and other towns were included
in the system--more notably Boston
Here the work was placed by Mr.. Will
son, the government declared, in the
hands of Robert P. Matches, who was
assisted by man named ]. j. ~Mahoney
And it was in tracing the ramfcations
OF Matches's operations that Mr.. Os
borne suddenly, without any warning
sprung the big surprise OF the day
with his charge OF funds used fol
the purpose of brbing the Boston Dis
trict Attorney. -
BY this time, the prosecutor said. all
was far from we'll with the affairs OF
the Emerson Motors Company. Ir
many quarters the whirlwind campaign
they had undertaken had excited sus
picions.
Finally, in September" declared Mr.
Osborne, "Mr. Mahoney, at Boston, was
visited by person posing as prospec
tive stock purchaser.
"Mr. Mahoney will testify to yor
that at this time, in September. 1915
he had been instructed by Mr.. Matches
in selling the stock Of the Emersor
Motors Company, to tell prospective
investors that the company then was
manufacturing two cars a day, and in
tended shortly to manufacture five car,
a day. when the true facts Show thai
they, had completed nothing but the
purchase of these so-called demonstrat
ing or sample cars; that they intended
to build four more and had about q
hundred wheels or rims over in thi,
factory at Long Island City, which the,
then designated as their Temporary
! "The entire conversation betwee,
this gentleman. who turnes