The Richmond Virginian. (Richmond, Va.) 1910-1920, 1919-03-03
PREPARING DOM Or
STOCK SWinDLERS

John BarIeycorn has been handed
his passports. 1t is possible that the
stock swindier viii get hist
There b hope.
The stock swindler--smooth ~ silk,
tdevil-in-a-bosiness- suit-h&s 20 long,
protested By = highly accomplished
retinus Of legal sharks. had HIS win in
spite Of the law. that It n difficult
tor those who have watched his pro
6res to believe that hia doom u near
But y may be imminent HIS greater
esss1ss zzsFs9 -xVE-r-y ,ykssTsllk
Iads p1szbis me sAls exsLineru Bonds
- 1e4Aea t9, ~, n g. AAzsEe5HnH4 sElsO
newer before held . piece Of invest
ment paper, and whom the stock
swindler, with itching fingers had
hailed - his prey. His greater enemy
- tho Gystsm Of federal reserve banks.
vsll-orgAnissr ana capable Of coping
with his kind.
II has recently besn estimated BY
De comml1tea on fraudulent adver-
t1g1ng Of tho Investment Bankor1 az
sociation Of America that saies of
lfrauduIent securitieA either for cash
Tor IN trade for liberty bonds, have
reached the enormous sum Of from
42so. ~, eeV to $see.oo0.o0o . year.
In comment the committee said.
while there h wide margin be-
tween the two figures. even the
smaller figure i = msnacs to the
In the middle wsse. where the close
!of the harvest season brought a
swarm Of dick stock salesman, the
country banks have undertaken the
delicate and often thankless task of
educating the farmers to Withstand
the mental browbeating Of the glib
tongued thieves. Many of the banks
have made 1t q rule net TO handle
any OF the farmers notes where they
are given in exchange for worthless
oil tractor, farn-machinery. and
such like stocks" 1t has taken
courage to do this, at the risk Of los
Ing good customer. but the banks
have relied upon the inevitable ex-
future gratitude OF the farmer More
over they know. that If they discount
the note the victim will feel sense
OF resentment against them when he
finally learns that he has been duped
In the old days, email out-of-the-way.
country banks have been known to
play into the hands Of fraudulent prn-
moters, but such a condition has
passed with the Federal Reserve Sys-
TENS advent
n warning to the banks OF his
dis riot. john H. Rich. Reserve Agent
for the Federal Reserve Bank of
Mir eapnIis. recently said:
u he business OF selling stock Is
high specialized. Promoters, who
are cl wer. customariIy avail them
seivs OF competent legal advice. and
process d with the utmost thorough
ness, method and system in the pro-
motion OF the issues in which they
are interested. Schools for statesmen
are . common Incident to these cam
paigns. and in these schools statesmen
are trained In the effective methods
of making their arguments plausible
to the investor. When they take the
field they are in charge OF an experts
manager. Thy operate frequently In
groups. dividing a given territory
among them. and rapidly and sys-
tematically clean up all the
prospects"
The New York Stock Exchange has
entered the lists against the financial
Wallingfords. and as a first step has
obtained from All Of its members an
agreement to include In all of their
advertising copy a short slogan to be
supplied by the committee. The first
ing In advertisements of member
firms. says:
According TO a statement by Presi-
dent HI. G.. s. Noble, The action
taken by the exchange win be merely
the opening wedge in a broad national
campaign to expose stock -swindling
and in this way protect the |
security buying public" $500 Forbes