The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-05-28
HARD TO PROVE OIL
FRAUD, SAYS SWAMI
Prosecutor Tells Obstacles He
Faces, but Will Do the
Best He Can.
WALL STREET WATCHING
Representative Brokers Feel
1t Is Time Cleanup Of
Crooks Was Made.

terday another statement telling how
hard 1t is for him az District Attorney
10 prosecute oil stock swindlers and
other dishonest brokers and promoters.
He indicated that the District Attorney
ia all bound round with legal difficulties
30 that he feels before he starts that It is
nearly impossible for him to secure a
conviction.
That was all he had to say. except
that he is going to work hard to over
come the insurmountable obstacles he
Gees John T. Dooling, Assistant Dis
rict Attorney. who. Judge Swami said.
has been working on stock frauds for
several weeks. has been staying UP late
the last few nights trying to catch up
with the work OF his ONCE and looking
over the complaints and records which
have accumulated in the last year.
Wall street Urges Action.
Men In Wall Street who have known
Of the complaints which have been made
to the District Attorney for months past
and who know Of, the representation Of
conditions in Wall Street made by men
N the Street who Are interested in keep
Ing out the crooks, were much interested
yesterday when they read Judge Swann's
announcement that he intends to investi-
gate and prosecute vigorously every dis
honest broker he can lay his hands on
They feel that II is about time some-
Thing was done, and are glad the District
Attorney has at last been stirred to ac-
ton. They said they would keep the
District Attorneys assurances in mind
And watch closely the results of his
work.
Judge Swami called attention to the
legal checks which he feels will hamper
him 30 in his work
The people have no idea Of the Diff
Guilty, a difficulty that is almost insur-
fnountable, that must be overcome In in
festigating these fake oil companies"
taid Judge Swami. Because of the re-
quirements of the law, as laid down in
the United States Court of Appeals, It is
almost impossible to place any of these
swtndlers on trial with the hope OF OBJ
tanning a conviction. Notwithstanding
this, We are going to try to overcome
the obstacles and clear out the sharks
from the financial feeding grounds, the
Wall Street district.
I'm the first place, the decision Of the
Federal Court of Appeals in the case Of
the United States against Jared Flagg,
prohibits the raiding of the offices Of
brokers dealing in fake mining or oil
stocks. the court having held in that
case that such seizures are illegal, and
the evidence obtained in that way In
competent against the accused.
THE court held in that case that a
conviction based upon evidence SO OBJ
tained must be reversed. II criticised
the District Attorney. the Federal Dis
trict Attorney, in that particular case for
having raided the Office and seized the
papers.
''In the case Of the people against
Hromwich in the New York Court of
Appeals report. II is held that a County
CLERKS certificate authenticated by the
presiding Judge of another State Is not
proof Of the non-existence of the facts
certified to. Under this decision the Dis
trict Attorney could not prove by the
Certificate of the County Clerk of the
county In Texas that there is no oil well
owned by the defendant company in that
county. or that there are no oil leases or
records In defendants favor, or that the
qerendsnt does not own any real estate
in the county
such ruling was upon the ground that
fhe defendant must be confronted by his
fccusers and have an opportunity to
course is quite proper. requires the Dis
rict Attorney to send to distant States
and make searches of records and in
qutries In the vicinity so as to prove a
negative. to wit. that the defendant does
not own an oil we'll at the place repre-
sented.
Likewise the prosecutor is confronted
with the difficulty of proving the true
mineral wealth of the properties held
forth as bubbling bonanzas by some of
the promoters. Most of these properties
are located in old Mexico and in Texas
and In order to get at the true value of
them 1t will be necessary to secure
Information from the inside.
Would Bar Advertisement.
~ firmly believe that the solution of
the problem is with the newspapers. II
they will refuse to print the zlittering
advertisements of the promoters until
they have been thoroughly investigated
the public would not be apt TO lose its
money The well prepared advertise
ments of these swindlers lead the gull
lfble individual to believe that fortune
lies in walt for him with the investment
of few dollars. ] intend to enlist the
cooperation of the newspaper publishers
and the members of the big advertising
swtndlers from the city.
"In the meantime we will 20 on In
yestigating. I think we will have the
support of the members of the Stock
Exchange and other exchanges, who
are anxious that the swindlers be
punished. We have received many COM
plants which were made in good faith,
but In several instances even after we
had secured indictments the complain
ants notified us that their money had
been returned and they did not care to
press the complaint"
As matter of fact, officers of the
Stock Exchange have referred cases to
the District Attorneys Office for action,
and In one case at least their complaint
apparently received no attention. They
have always told the District Attorney
that they would be glad to help him in
any way.
The reference to the newspaper adj
Tertisements is the only concrete item in
Judge SWANS programme which has
been mentioned, although his assistant
who worked In the Commercial Frauds
bureau Tor months outlined to him a
complete method OF procedure on which
The District Attorneys office could act
IN the hope of getting evidence against
stock swlndlers. This report showed
that II evidence could not be obtained
by raiding Offices, 1t could be obtained
IN other ways. and recommended that A
Etan or investigators be employed 10
get just the evidence as to oil properties.
Which Judge Swami says n county
clerks license is sufficient to support.
Police Court Clerk Held Tn.