The labor standard., 1919-08-15
CROOKED BROKERS
 REAP OIL PROFITS
Fraudulent Promoters Offer 33 7-3 Per Cent Commis-
 sion as a Lure.
INNOCENT ARE THE SUFFERERS

Regular saturnalla of swindllno ls
 Now in Progress-PubIieity Is
 Urged as Best Remedy
 for Evil.
 New Y0rk.-The inner philosophy of the buccaneer oil promotion company in the business of selling stocks i'm stead of oil is neatly exposed in confidential" letter received the other day by a reputable New York Stock Exchange firm, says the New York Sun. The writer, an officer of a There today and gone tomorrow Western faking corporation, was trying to get New York broker to put out it's securi- ties, and obviously thought he was ad- dressing firm of traders as shady as himself
 cost is in finding new clients. Your profit is made in selling them repeated ly the same stock as the dividend and price advance"
 He then offered to pay a commission of S8 1-3 per cent, under which agree ment $1 of every $3 paid by the in- vestor would stay in the hands of the stock peddler. The generous "oil' man continued:
 'eThe price of the stock is $2 share. It will be advanced to $2.25 within the next 30 days, after which it will be gradually raised to $3. These addi- tional raises are the best methods known to sell stock to clients"
 Shares Are VaIueIess.
 The stock had no value; there was nothing behind 1t. The price was an arbitrary figure fixed by the company. The proposed raises would have been arbitrary. If buyer had tried to sell the company would not have bought the stuff back at any price. The con- pany was merely intent on getting broker to go shares with it in kidding the public into snatching at the securi- ties by 44the best methods known to sell stock to clients" Reputable brokers do not even answer such let ters. Nor will they allow their GUS toners to buy stocks which have the faintest odor of trickery if they can prevent it. The other day man who lives in a suburb of New York got a hot tip on a new oil stock recently in- trOduced on the curb but not listed. He hustled into town and asked broker whom he knew to buy 300 shares.
 Cant do it." said the broker.
 "I thought you could buy anything" said the commuter..
 Certainly can buy anything, but shall have to decline to take your or der for this stock. don't know any thing positive about the company, but it looks bad to me because do know something of the people who are put ting 1t out"
 The customer departed in some thing of huff, for he had splendid information" about the stock. He found another broker and purchased the 500 shares. That afternoon it ''went up" nearly point, which is lot for low-priced curb security, and the suburbanite tried to take his quick profit. His new broker, however, was unable to get a bid at the new price. In fact he couldn't get any bid at all, although the curb continued to quote the high figure,
 The buyer of the 800 shares still had
 
 periences of others with oil companies of the same stripe they eventually will pass to his heirs as an interesting souvenir, unless the waste paper man gets them first.
 Situation Is Dreadful
 The Sun asked a man of prominence in the New York Stock Exchange how it felt as an organization about, the gwindlers' saturnalia now in progress and what 1t could do to protect the public
 .'Of course," he answered, "we are more than mortified. All the time the most pitiful cases are being reported to us-governesses, all sorts of poor persons, losing all their savings in oil Investments The situation is per fectly dreadful. Outside of the suffer ing 1t causes individuals, what repu- tation 1t is getting for the city of New York. People all around the country are being led to believe we are a nest of swindlers. The government has done something, but why it doesn't do more don't understand. "A few years ago the New York Stock Exchange put the bucketshOps out of business by taking our ticker quotations away from them, an act which the courts sustained.
 @The New York Stock Exchange is doing all 1t can, and in cooperation with representatives of the district at- torney has got action in several cases, but we have no control except over our own members. The most effective remedy for these abuses Is publicity"