The sun., 1918-12-26
ISSUES COMMITTEE
TO SUSPEND DEC. 81
Warns Public Not to Buy
Worthless Stocks and Acts
for Prohibitive Law.
NAY RESUME OPERATIONS
Secretary Glass Will Appeal
to Congress to Legislate
Against Evil.
MAY RESUME OPERATIONS

WASHINGTON, Dec. 25.--The Capital
Issues Committee of the Treasury. the
Governments war agency for the sup
preston of unessential security issues,
announced tonight that it would sus-
pend activities on December 81 and re-
main inactive until dissolved unless
called back into service by develop
nents.
Accompanying the announcement
we're warnings to the public both from
the committee and Secretary Glass of
the necessity for continued strict
economy and guarding against worth
less securities. The committee
stated its intention of making a sup
Elementary report to Congress recon-
mending law to prevent impositions
upon the investing public, and Secre-
tary Glass said he would ask the
present Congress TO enact such lesis-
lation Immediately. To illustrate the
extent Of the menace. the committee
said schools were being established TO
drill statesmen in the art OF fraudulent
promotion.
Enormous. Losses by Fraud.
Charles S. Hamlin. chairman. made
this statement for the committee:
an view of the rapid changes that
have taken place since the signing of
the armistice, the Capital Issues Com
mittee has voted TO suspend its ac
tivities on December 81. The COM
nittee will not be dissolved but will
remain inactive, unless 1t is found that
the sale OF new securities completes
unduly with Government financing or
for other reasons it may become de-
slrable for the committee to resume
its work pending its dissolution by the
President or by operation of law.
Although the war emergency which
gave rise to the creation of the COM
m!ttee has passed IT is nevertheless
imperative that capital should be
saved and not wasted. and the removal
OF the restraining influence exerted by
;he committee during its existence
should not be construed as approval of
the financing OF unnecessary public
projects or private enterprises of
doubtful merit. on the contrary, the
financial needs of the Government and
the large capital requirements Of tho
railroads and for the readjustment of
American industries TO a peace basis
compel strict economy in the use OF
new capital.
CaDitaI MusA Re CnusarrAd
while legitimate business may
safely be left to work out its own
problems, the Capital Issues Commit
tee feels that 1t would be unfaithful
TO its responsibilities If II failed TO
warn the public respecting the enor-
nous losses sustained by the nation
through the sale of worthless and
fraudulent securities. In the opinion
OF the committee the sale of such
securities should be restrained in times
Of peace as well as in war and II
strongly urges that Congress estab-
Ash adequate machinery to put a stop
10 this traffic.
The extent OF the menace, due to
the issue Of such securities to the
holders Of Government bonds is re-
'ealed by the fact that schools are
BENG established In some parts OF
the country to drill statesmen in the art
of persuad!ng investors to subscribe
LOT nnmeritorious or WORTHLESS securi-
tes. This can only be prevented by
legislation vesting in some duly con-
STUFFED public agency full power to
restrain the offering of fraudulent
" worthless securities.
The Capital Issues Committee
warns the public and earnestly dl-
reefs the attention Of Congress to
,le problem. II is the intention OF
H'e committee to make a supple
Wentary report to Congress recon-
m'nains law TO prevent these ex-
sung abuses and such impositions
upon the investing public.
Control May He Resumed.
secretary Glass's statement follows:
Inc decision of the Capital Issues
,''llllttee to suspend its activities on
december 81, should not be interpreted
" the business public as a warrant
.or any expenditure of capital for
NEEDLESS or unwise purposes. whether
PUBIC Or private In their nature.
ehould II become apparent that volun-
'a'y restraints are not being exercised
~ as to prevent the misuse Of capital,
snail request the committee to re-
sumo It's control.
hy chief misgiving in accepting the
action Of the committee arises out of
we need the committee has frequently
oppressed and the importance Of which
As become increasingly obYiouA Of J