The daily star-mirror. (Moscow, Idaho) 1911-1939, 1919-06-18
CROOKED BROKERS
REAP OIL PROFITS
Fraudulent Promoters Offer
SO 10 Per Gent Commits
sion as a Lure.
INNOCENT ARE THE SUFFERERS
Regular SaturnaIia of SwindIinq Is
Now in Progress-PubIicity ls
Urged as Best Remedy
for Evil.


the buccaneer oil promotion company
in the business of selling stocks in
stead of oil is neatly exposed in 8
confidential" letter received the other
day by reputable New York Stock
Exchange firm, says the New York
Sun. The writer, ali officer of "here
today and gone tomorrow" Western
taking corporation, was trying to get a
New York broker to put out its securi-
ties, and obviously thought he was ad-
dressing firm Of traders as shady as
himself.
you know" he wrote, 'the heavy
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 commission
of 33 1-3 per cent, under which agree
ment 81 of every So paid by the in
weston would stay in the hands of the
stock peddler. The generous "oil'' man
continued:
''The price Of the stock is 50 share.
1t will be advanced to 1925 within the
next 80 days, after which 1t will be
gradually raised to So. 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 it.. The price was an
arbitrary figure fixed by the company
bo
arbitrary. If buyer had tried to sell
the company would not have bought
the stuff back at any price. The COM
pany was merely intent on getting
broker to go shares with it in kidding
the public into snatching at the securi-
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 new oil stock recently in
troduced on the curb but not listed He
hustled into town and asked broker
whom he knew to buy 500 shares.
"Can't do it," said the broker.
II 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. l don't know any
thing positive about the company, but
it looks bad to me because 1 do know
of the people who are put
ting it out"
The customer departed in some
thing of a huff, for he had splendid
about the stock. He
'Mlnd another broker and purchased
he 500 shares. That afternoon it
went up" nearly point, which is a
OF for a low-priced curb security, and
he suburbanite tried to take his quick
,roft. His new broker, however, was
Unable to get bid at the new price.
n fact he couldn't get any bid at all,
the curb continued to quote
he high figure.
The buyer Of the 500 shares still had
hem recently and judging by the ex-
CllcuCSS VI OlliClS Win OlI COMPANIES
f the same stripe they eventually will
ass to his heirs as an interesting
ouvenir, unless the waste paper man
cts them first.
Situation Is Dreadful
The Sun asked a man of prominence
l the New York Stock Exchange how
felt as an organization about the
windlers' saturnalia now in progress
nd what it could do to protect the
ublic.
"Of course" he answered, 1--WE are
lore than Mortified. All the time the
lost pitiful cases are being reported (
} us-governesses, all sorts of poor
ersons, losing all their savings in oil
Investments. The situation is per-
,ctly dreadful. Outside of the suffer
g it causes individuals, what repu-
ltion it is getting for the city of New
ork. People all around the country :
,e being led to believe we are nest !;
swindlers. The government has r
one something, but why it doesn't do
ore I don't understand. !
"a few years ago the New York .
-ock Exchange put the bucketshops 6
1t of business by taking our ticker !
rotations away from them, an act Z
hich the courts sustained .
''The New York Stock Exchange is 4
ling all it can, and in cooperation h
it'll representatives of the district at E,
rney has got action in several cases, +
it we have no control except over 9,
II own members. The most effective
medy for these abuses is publicity" :,
Il