The Dawson news. (Dawson, Ga.) 1889-current, 1919-02-25
FRAUD A BUSINESS"
THROUGHOUT THE U. S.
STOCK SWINDLERS PRIDE THEM
SELVES ON SUCCESS. THINK
PROSECUTION UNLIKELY
WITH WAR OVER WILDCAT"
SCHEMES HAVE BEEN REVIVED
Concern With Expensive Offices in
Many Cities Sells Stock Which Ex-
pert Says, in His Opinion, Has
Been Rendered Virtually Worth
less by Recent Invention.

pert Says, in His Opinion, Has
Been Rendered Virtually Worth
less by Recent Invention.
Whenever state or federal author
tiles choose to do so they check the
wild cat" stock promoters. The fed
eral agents gave a classic example
last summer of what they are capable
of doing, writes Richard Spillane in
the Philadelphia Public Ledger.
In Broad street, New York, a few
doors from the stock exchange, there
is concern which has been fairly
prominent in curb market affairs. 1t
launched a company and began a
stock-selling campaign. From the lit
erature it disseminated it would APP
pear that any one fortunate enough
to invest in this enterprise would be
made rich
Investment was made easy by the
partial-payment plan. 1t would not
be long before the stock would be
dealt in on the curb market. The
money paid in by the stockholders
was to go for development purposes.
A great scientist had sold to the COM
pany discovery which had incalcu-
liable possibilities of profit. Tests had
demonstrated the practicability and
worth of his discovery. 1t would not
be long before he was recognized as
one of the foremost figures in Amer
lean science along with Bell, Westing-
house, Edison and others. Opportuni-
ty knocks at your door but once This
was your opportunity. Buy now and
be wise. Those who get in on the
ground floor today would be the mil
lionaires of tomorrow.
Government agents went into the
! Office of the promoter one day and
went over his books and his bank ac-
count and all his Literature" They
found he had received $4,000 from
persons who had been impressed so
much by his promises that they had
subscribed for stock.
Got Their Money Back.
eve do not say you intend to
fleece these people," said the govern
ment official who directed the inquiry,
but we are going to ask you to agree
to place the $4,000 in escrow. That
is formality only, for your bank
has been ordered to hold that amount
pending further orders. If the state
ments you have made to the people
who have sent this money to you are
true you have nothing to fear and
nothing to lose. But if they are not
true you are deceiving the people
What we want you to do is to fur
nlsh proof your statements are true
Until you give that proof you can
not handle any part of the $4,000
and you cannot get any more, for we
will stop your mail. If necessary we
shall go further. You know what that
means"
The $4,000, it is understood, went
back to the people who subscribed
for the stock, as the promoter was
unable to prove the truth of what he
was so positive about in his letters
to the public
Rarely do the United States au-
thorities take such radical action as
in this case. Probably they would
rather not have done so in this in
stance but for the fact that we are
at war. The government needed |
money. 1t had to sell bonds to the |
public. 1t regulated, through the cap
ital issues committee, the flotations !
of new companies.
Schemers Renew Activity.
Now the brakes are off. The war is |
over, with the exception of signing |
the peace treaty. Many schemers who |
had all sorts of wildcat" projects |
and whose activities were negatived |
by the war are in full action.
If the names of all black sheep in |
the promotion game were printed, to-
gether with their operations, it would |
make long article.
The case of the Broad street, New
York, promotion person who had a
visit from the government officials
with the result that $4,000 was put
in escrow is given because it illus
trates how the public can be pro-
tected.
No one wants to put thralls on en-
terprise. 1t is necessary to get money
to develop properties. But there is
such divergence in the corporation
laws of different states that pre-
MUM is put upon dishonesty. In
some states it is possible to charter
anything, and the public, in it's care
lessness, does not distinguish between
charters issued in states where there
IS none.
The amount of money the public
has lost through the misrepresenta-
tions of promoters is unbelievable,
almost.
More money has been paid for
stock in gold" mines than there has
been gold taken out of the earth in
America.
More money has been paid for