New-York tribune., 1921-03-26
Taft Is Asked
10 Investigate
Amer. Smelling
Board of Directors Deems
Impartial Inquiry Advis-
able to Refutc Charges:
Guggenheims' Suggestion
Broader Control Planned
Large Stockholders to Get
Representation; Eiler s
Accusations Bring Action

&ASSAo0sAVAAS LII Ing ACtlOAl
William Howard Taft has been in
vitcd by the board of directors Of the
American Smelling and Refining Com.
pany to Investigate charges and accu.
sations made against the present man.
agement, it was announced yesterday
The board said it deemed an impartial
investigation advisable to set at res,
rumors which had tended to deprcss
the value Of the stock.
| The announcement was made in a
letter to stockholders signed by Simon
Guggenheim, E. L. Newhouse, F. H
Brownell and William Loeb ir. A let
ter from the five Guggenhcim brothers
Isaac, Daniel, Murry, S. r. and Simon
in which Mr.. Taft's name was suggest
cd for an inquiry, was inclosed with
the letter.
The Guggenheim letter summarized
the charges and attempted to answer
them in some detail. and then con-
tinued:
Though your board is aware OF the
charges and the answers and though
we ourselves know the charges to be
unfounded, nevertheless these charges
have had or may have the following
results:
"They have tended to depress unduly
the market price of the securities OF
|'thc company.
Raised Doubts
"They have raised doubts and fears
in the minds Of some stockholders who
arc not acquainted with any Of the
limited knowledge of the company's af-
fairs.
"The undersigned believe therefore
that the interests of the stockholders
as we'll as of the persons charged with
wrongdoing demand careful, impartial
investigation of all charges which
have been made or which may be made.
This investigation should be under the
direction Of man Of national reputa-
tion, of high character, experience and
ability, whose findings upon the sub
ject can be accepted by all fair-minded
persons.
1--WE venture to recommend there
fore that the board invite a man of
the high character and standing Of ex-
President William H. Taft to conduct
such an investigation. We should be
glad personally to defray the expenses
of such an inquiry if that should be
regarded as consistent with the COM
pany's interest.
Thorough Inquiry
"Mr. Taft, or whomever the board
may select, should have power to en-
ploy expert assistants, such as account
ants, engineers, counsel, metallurgists
and other specialists. He should have
access to all records and documents,
and his findings should cover specifi-
cally tho question as to whether the
Messrs. Guggenheim have or have not
at all times in their relations with the
company consulted primarily the in
terests of the stockholders, and whether
anything has been done by them which
was not in accord with high standards
of trusteeship and honorable conduct.
"We feel confident of the results of
such an inquiry and earnestly recon-
mend that it be undertaken imm ediate-
~"
That tho action was precipitated by
charges made by Karl Eilcrs, former di-
rector and vice president Of the COM
pany, was indicated by the letter from
the holders Of proxies, which said, in
part:
en- view Of the serious charges made
by certain stockholders during the cam
paign for proxies preceding the an
rectors of the company, upon the rec
ommendation of the Messrs. Guggen-
helm, have deemed it desirable to have
an impartial investigation made by a
man Of the highest standing. Ex-Presi-
dent William Howard Taft has been
formally invited to conduct such an in
vestigation, with power Of employing
such assistants in the nature of coun-
sci, engineers, accountants or other
specialists as he may deem desirable on
any specific matter. The report Of ex-
President Taft, should he undertake
this task, will in due course of time
Bio sent to all stockholders.
Aid from New Board
ceived by the board of directors from
the Messrs. Guggenhcim, suggesting
this action, and we expect the board of
directors which we will nominate at the
coming election to lend every assist
ance in their power to the end that the
actual facts may be fully disclosed and
understood.
"In view Of the foregoing we do not
deem it necessary to take the time of
stockholders in reading an answer to
any of the many vague, inconsistent and
baseless charges of former vice -presi-
dent of the company further than to
call attention to the fact that this Of
ficer was a director of this company
from 1905 to 1919. All Of the charges
now made by him refer to alleged trans
actions taking place prior to 1919. with
the single exception of the termina-
tion Of the copper sales agency, which
is fully explained in the annual report
to stockholders"
This letter also said, after describ-
ing the progressive growth Of the COM
pany and the tendency toward inside
management, that steps would be taken
to broaden control. The plan was thus
discussed:
eve expect, however, to nominate
and place upon the board a substantial
number of new directors, representa-
tives of important financial institutions
which are large stockholders, including
trust companies, bankers and insurance
companies. There will thus be rep
resentation of the largest stockholders
and some Of the most important finan-
cial institutions of New York City"
2 Northwest Roads Ask
IT, EI ~ ID o ~ III