The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-06-03
SWAMI PROBES
BROKERS' SALE
OF OIL STOCK
Rangebumett, Boosted to
Sc From 40 Cts, Has
Dropped to Under 50.
TWO FIRMS INVOLVED
Paul A. Newman and Walter
J. Pierce Visit District
Attorney.

The manner in which two Broad
street brokerage firms, Paul A. New
man & Co. and Walter j. Pierce & Co.,
have exploited Rangeburnett, one Of
the most widely advertised oil stocks,
during the last two months is being in
vestisAted by District Attorney Swami.
, Rangeburnett was boosted from 40
cents to IS on the curb, and the daily
trading amounted to many thousands
OF shares. 1t then took a tumble and
yesterday ranged from s112h to
s13715.
One of Judge Swanns visitors yes
terday was Loring NJ. Black, State
Senator, who as lawyer drew the ar
tlcles of incorporation for the. Range
burnett Oil Company. according to the
District Attorney. Senator Black"
said Judge Swami. admitted to me
that the Rangeburnett Oil Company
had not at any time up to date ex-
tracted an ounce of oil from the earth
or anywhere else, but told me that its
prospects were considered good"
Laid Stress on Prospects.
Senator Black is a Republican.
Paul A. Newman & Co. have Offices
in tine Mills Building. 10 Broad street,
and Walter J. Pierce & Co. are in so
Broad street In their rather neatly
worded advertising they have never &C.
tually said that the company had struck
oil. but have leaned heavily on the sur
roundings and future prospects. On
March 10 Newman wrote to a pros
pective customer in Yonkers:
I'VE are assured by the management
OF the Rangeburnett Oil Company that
the company possesses some most val=
liable leases in the Burnett field. The
properties are surrounded by magnif-
cent pools and by numbers of wells,
some of which are gushers producing
5000 70 5000 barrels of oil daily. We
are further told that the best geological
advice the company has been able to
obtain convinces them that their prop
critics are very likely to bring in sope
sensational wells. You will appreciate
that even a single gusher would prob
ably send the stock to several dollars a
share
The company has rigs ready to d. I'll
and will within two or three days be
actively at work on the development OF
the leases. And as this activity increases
naturally the stock will advance In
price. We regard Rangeburnett at the
present quotation, so cents, as the best
oil stock on the New York curb, and
we urge you to place your orders with
us Immediately"
The stock did go up, but John T
Dooling, Assistant District Attorney, hai
letters written by Frank B. Barnard o.
Buffalo. treasurer and vice-president O.
the company. saying that the advance
was not justified and protesting agalns
the brokers' advertising and othe
methods.
The company was capitalized Will
100000 shares of 81 par value each
Newman, according to Dooling, con
tlacted for 400 900 shares at fifteen cent
and got an option on 100000 more. New
inaU then started his advertising, circu
lari2ing and letter writing campaign
Mr.. D0oling figures that he got rid of hi
100000 shares at an average price o
So II that is SO Newman took in $500,
900. of which the company got onl
$4,000, Mr.. Doolng made, public thi
excerpt of a letter sent to Newman an
Pierce by Barnard. vice-president OF tn
company, on April IL:
Too High at go Cents.
II regard the present price of tn
stock aS entirely too high. and hav
told you so many times. even when tn
stock was around so to 20 (cents)."
On April 80 there was another pre-
test President w S. Edwards and tn
Focretary of the company Joining Vice
President Barnard in writing Newma
and Pierce.
The last big advertisement of Paul J
Newman Co.'S offering appeared
some newspapers May ~. In blac
faced type it began: $4,000 Barrel
Of Oil: $791, 900 Net Earnings; $1.126
600 OF Equipment; About 1900
Acres in Proven Territory" There 70
lowed three lines of much smaller typ
and then a huge "Rangeburntt Oil Con
pany"
The reader who waded through II
small type learned that II was not Il
Rangeburnett marvel that had all tn
production, money. equipment and prove
land but a 'long established and ind
pendent oil company, negotiations II
which the vice-president OF the Rang
burnett company had been authorized
the directors on May 10 Close
Mr.. Dooling said yesterday.
I'VE have information that the prol
critics the Rangeburnett Oil Compar
purpose buying were those OF Il
Eastern Oil Company. We are informt
that on May 10 the deal was declare
on The minutes of a Rangeburne
company held on May 10 indicate thi
the person who had agreed to deliv'
the Eastern Oil Company reported TIL
ne couldn't do 1t. We also have tel
grams from G. Il. Keith, manager OF Il
Rangeburnett operations at Archer CIT
Tex, saying that by May 23 well WI
down $50 feet. mad other kilograms cal
ing for money to continpe the drilliI
aud pumping, as everything is tied
for want of funds"
Newman and Pierce have visited DO
ling. Newman said, according to q
Assistant District Attorney. that h
record was clean. and that enemies we
trying to make trouble for him.
Sims Heads Naval War College
NEWPORT, June Rear Admiral w
liam s. Sims. who as Vice-Admiral col
manded the United States naval fore
in European waters during the war, a