New-York tribune., 1920-10-06
Shrewd Trader
Used by Travis
To Buy Bonds
Tribute Paid at Inquiry to
Ac,snen of Agent Who
Obtained Securities for
Sinking Fund of State
Profits Saved i'm Deals
Metropolitan Trust Added
S290,315 to Personal Ac-
court Of the Purchaser

ia cgcS against state Comptroller
Eugene NJ. Travis. in connection with
the methods employed by his Office in
purchasing bonds for the various state
sinking funds, were the object Of an
inquiry begun yesterday in John Doe
proceedings before Chief Justice Fred
eric kcrnochan, of Special Sessions.
The evidence on which the charges
are supposed to be based has been
gathered by Assistant District Attor-
ney Ferdinand Pecora during an inves-
legation which has extended over the
.ast three months.
When the inquiry was opened yester-
Gay in Part VI, Special Sessions. Mr..
Pccora said that Mr.. Travis had ar
ranged through his attorney, lsidor
Wasservogel, to appear in court FIJI
day morning for examination.
The testimony of three witnesses yes
ierday Indicated hat millions of dol
lars worth of bonds that found their
way into the sinking fund of the New
York State treasury were purchased by
the Comptroller's Office through Albert
l.. Judson, trader in securities, who
las an office at 80 East Forty second
Street, and who is said to 1.-Two at the
Hotel Plaza.
Two of the witnesses, Gilbert E.
Jones. manager Of the bond departme ent
of the Guaranty Trust Company, and
II. c. Sylvester, vice president of the
National City Company, described Jud
son as one of the shrewdest bond buy
ers in the city They declared, however,
that in the various bond purchases
made by Judson through their re-
spective companies for the State Comp
trollers Office he had always acted in
good faith and had lived up to his con-
tracts.
The testimony Of the third witness,
Bertram Cruger, treasurer of the Met
ropolitan Trust Company, so Wall
Street, which firm cleared all of the
purchases made by Judson through the
Guaranty Trust Company and some of
those made through the National City
Company, showed that as a result of
the various transactions the sum Of
$3.50, 81 5.65 was added to Juds ons per-
sonal account with. the Metropolitan
Trust.
The bond purchases made by Judson
through both houses for the State
Comptroller amounted to approximately
S15,O00,0 600. Figures read into the rec
ord of the investigation showed that
through the Guaranty Trust Company
Mr.. Travis 5 agent bought municipal
for which he paid $9,905,172.
Through the National City Company
he bought bonds to the par value of
S4,679,OOO, for which he paid $3,937,1
Judson's dealings with the Guaranty
trust Company began in January, 1918,
and were carried on until December,
1919. while the purchases made through
the National City Company, which were
five IN number, were transacted between
November, 1919, and May, 1920.
Mr.. Cruger testified that son January
IL, 1919. the Metropolitan Trust Com
pany paid to the Guaranty Trust Com
pany Tor the account of Albert L. Jud-
son Sl,994,5l3, and received the State
Comptroller's warrant for s2,o71.975
TOR purchase of New York City bonds
through the Guaranty Trust of $780,
OO0. The difference the witness testi-
ned, amounting to $77,462, was cred
lted to Judsons personal account with
the Metropolitan Trust Company.
In June, 1918, Mr.. Cruger said. the
metropolitan Trust Company paid to
the Guaranty Trust Company for the
account of Albert L. Judson and
number OF other brokers, among whom
were William A. Reid & Co., the sum
OF Sl,600,476 for the purchase of ST..
oua, ,OOO wortn of par value bonds. for
which they received check from the
comptroller for Sl,65S SOP, which netted
the Judson account a gain of S5S.426.
In January, 1919, the witness testi-
led, the Metropolitan Trust Company
paid to the Guaranty Trust Company
Tor the account of Judson S3.2l2.421
Ior municipal bonds valued at S2,250.-
wv. These securities were resold to
ihe state by Judson for $3,2S9,6O9.
netting him profit of $77,lSS on the
deal.
On the sale of bonds valued at s3-
100000 to the state, in December. 1919
the figures testified to by Mr.. Cruger
lndlcated that Judson had profited to
the extent of S7S,239. For this block
OF oondS Judson paid $3,435 ,637 and
received from the Comptroller's office
$3,5l3,S77.
Just what had become of the profits
--o4n these transactions after they had
seen credited to Mr.. Judson's account
80 witness was unable to say but he
TERED TO produce the complete rec
"a OF the bond traders dealings with
ne Metropolitan Trust Company when
me hearing is resumed at ten O'Clock
this morning.
II: [. Sylvester, vice president of the
National City Company, told of the
sale to Judson by his concern of bonds
amounting to $4.679, 900. In some cases.
ne SAID, the bonds were ordered de-
hVered to the Mercantile Trust Com
pahy ana IN other instances to the
Mechanlcs and Metals National Bank.
While Gilbert +. Jones, of the Guar
AMY Trust Company, had testified that
ne was aware that Judson, in making
'ne pond purchases, was acting for the
State Comptroller, Mr. Sylvester said
nat ne had no such knowledge, al
thougn he suspected that the securities
"e,e nought tor the sinking fund. He
ADDED that Judson made has purchases
through the Fifth Avenue office If 10
Nsticnal city Company, and due to this
Tact nc had never come in contact WIZ
Nin. MI Sylvester also paid a tribute
10 Judson's shrewdness as a hond hnvsr
and seller. "a
Both Jones and Sylvester declared
that their firms carried Judgon,s so
curities for him without margin or col
lateral because they believed him Co be
reliable and because they were safe
guarded from any financial loss hv LET
iers received from Judson's bank, which
Actsd as contracts covering the various
sales.
Both witnesses said that Judson was
shown no favoritism whateyer bv
either the Guaranty Trust Company or
the National City Company. and that ,
the blocks he bought through +Aese
houses would have been sold hy them
at the some figure 20 any other reput- (
anle purcneser. In some cases, the wit
lesscs said, their concerns owned the
bonds desired by Judson, and in others
::cys .e~t !:co the market and pur
- bAx&, l. L{x..