Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1919-08-02
Federal Trade Com
mission Makes Pub
lie Part iii of Report
Shows Dominion
Over Manufacture
and Distribution of
Meat Products
CROOKED
BEARER WARRANT
UNCOVERED

Washington. July 2s-Part II Of
the Federal Trade Commission re-
port on the meat packers was made
public today. Il in entitled Meth
DDS Of the Five Packers N controlling
the meat packing industry" and deais
with the big packers control Of the
stockyards and their related facin-
ties, their influence over live stock
market prices. their dominion over
the manufacture and distribution Of
meat products with particular refer
ence to their branch houses and cold
storage systems.
Incidental to the tracing Of the
ownersnips and controls of the pack
ers in stockyards. the Commission
uncovered the remarkable financial
device known as the Bearer War
rant" and devotes considerable arten-
ton to il
The Commission says that the
Bearer Warrant" device is such that
II might be used not only TO COM
plefeiy hide true ownership but Is
equally effective in making possible
the evasion Of income, corporation
and sur-taxes Il II came into more
general use.
Briefly a Bearer Warrant" in
receipt for stock certificate. The
certificate itself runs 10 the treas
urer of the corporation and he is
sues receipt or warrant for II.
The warrant runs TO bearer" and
the dividends can be collected ana
the stock actually voted without
even the officers CT the corporation
knowing who the stockhoider is.
The device was discovered by the
Commission in it's search for the true
ownership Of certain Chicago stock
yard interests and il prevented the
Commission from fully determining
the identity of the real stockholders.
The Maias End of n.
The Chicago Yards. yard RAILWAYS
and adjacent real estate development.
are operated by companies whose
stock is owned by the Chicago juno
ton Railways and Cnion Stock
Yards Co. of New Jersey, (which in
turn Is controlled by the Chicago
Stock Yards Co. of Maine. Bearer
Warrants" for 1914 per cent of the
Maine company stock have been
identified as belonging TO j. Ogden
Armour, president of Armour & Co
In the So, o0o, 600 deal suuerimpos-
ing the Maine corporation over con-
troll Of the Chicago yards-and in
which In 1911 s. o80.g00 Of stock was
exchanged for a typewriter docu-
ment known as The Plan" and the
original capitalization Of 81. 900. 400
increased TO $4,000 900 without addi-
uonai Invesrment-J. Ogden Armour.
the Commission found, paid in s194. =
e0e IN cash. receiving SI.55s. 900 of
stock IN the Maine crrnpanv. On
this stock he had drawn 1856. $50 in
up 10 1957-SIS.. $50 more
than his investment. and he will con
unue TO draw his 19.4 percent of all
the earnings the Maine company is
aoie to realize on ITS control of the
New Jersey corporation.
How the Big Five packers. Swift
d Co., Armour & Co, Wilson & CO.
Morris d Co. and the Cudahy Pack
ing Co.. control the American meat
industry-thelr means and methods
OF controlling livestock prices: their
dominating position in the mauufac-
tHre of meat products; their durnIn-
ion over the distribution Of products
through their refrigeraror cars.
hranch-houses and cold storage
ptants-is set cut in the report to-
day
The Packers coufrui,
The five great packers have used
tneir numerous stock yards to in
crease their control over the live
STOCK market and the meat packing
INDUSTRY as a whole. the Commission
oeiieVes, and It summarizes their
control as follows:
Although there ara % stockyaryis
IN the lnited States Al which livestock
re nougnf and sold. more than ~ per
SsnL Of the animals pass through - of
Inese ~ yards Chicago, Kansas CITY, 81.
LOUIS. 1fnakla, st. Juseph St Paul
Sew York City. Fort Worth. ssioux city
Okianoma City. Denver and wichita
ana the Tour largest yards altne receive
more than u per cent Of the cattle. IS
Per cent of the hogs and 81 per cent
OF the sheep. These four markets
tConfinued on Pa9e -.oI, 81