New-York tribune., 1921-06-26
Mutual Defed Law
In Stock Dealings.
Says Unternyel
Losses Not Due to Natural
Shrinkage in Securities,
Declares Lockwood Attor-
ney, Replying TO Peabody

Just before departing for Europe on
the Olympic yesterday, Samuel Unter-
nyer, chief counsel to the Lockwood
Committee, replied to the statement of
Charles A. Peabody, president of the
Mutual Life Insurance Company, con-
cerning testimony before the commit
tee on Thursday that the company had
suffered losses of $10,000,n00 through
depreciation in fifteen years of GER
tain of its securities
Mr.. Peabody had said; "The sup
posed losses of the Mutual Life are the
losses due to the natural shrinkage in
market values resulting from the late
war and other causes. On the othes
hand, the profits made by the Mutual
Life on the stocks since 1906 are many
million dollars more than the losses
measured by present market values of
the stocks remaining"
Mr.. Untermyer insisted that 'the
losses are not due to natural shrink
age, but to wilful and persistent def
ance of the policy Of the law as ex-
pressed by the Legislature.' He added
that Mr.. Peabody's explanation of the
failure of the company to sell the Sc
curities in question within fifteen years
because of the lack OF an advantageous
market "ls one on which the public will
form its own conclusion"
II would not be willing in these
times" Mr.. Untermyer continued, land
it would not be in the public interest
TO exploit the enormous temporary
shrinkages that have been suffered by
the Mutual Life or by any other cor
poration in these exceptional times.
The proof was carefully restricted to
losses as of December 81, 1920, and
only on stocks still held which should
have been sold fifteen years ago.
Il regret to have to take Issue with
Mr.. Peabody's misleading statement,
but it must not be permitted to go un-
challenged.
"Mr. Peabody's explanation that 35,-
0G0 shares of New Haven stock and
10000 of Pennsylvania stock and other
like marketable securities did not have
a sufficiently ready market to be sold
to advantage in fifteen years requires
no comment from Us.
1.-THE losses shown in the statement
referred to by Mr.. Peabody are losses
only on the stocks that were still held
at the beginning of the year, after
crediting profits on sales made during
the year. They do not include any
losses on sales made in 1919 or in
previous years"
Mr.. Untermyer is expected to re-
turn some time in September, when
the committee is to resume the in
vestigs tion.
Mr.. Untermyer boarded the Olympic
a few minutes before she sailed. He
was informed by friends who were
awaiting him that Attorney General
Daugherty had announced that the pol
icy of the Federal government in deal
ing with offenders in the building
trades conspiracy would be for crimi-
nal prosecution.
81 am delighted to hear that" said
Mr. Untermyer. "There has apparently
been misunderstanding, and I am glad
to know that it has at last been cleared
up. will do everything in my power
to help the case of the Federal govern
nent, and on the way across the At
lantic I shall lay out q program in de-
tail, which / will later submit to the
Attorney General and to Colonel Will
liam Haywood. the prosecutor for the
Southern District of New York, who
has my entire confidence and will re-
ceiye my whole-hearted help" q