The New York herald., 1922-06-14
Case Pushed BY Banton.

All the officers of the Curb Associa-
ton and several bankers were supposed
TO have been named in the subpoenas
which were issued by the Attorney
Generals office and distributed by pro-
cess servers from District Attorney
Banton's office.
Mr.. Banton said, just before the sur
render OF the Curb Exchange. and after
his conference with Mr.. Untermyer,
that as complaint had been made, he
had decided TO present the facts to the
Grand Jury without waiting for re-
port from his appeals bureau on wheth-
er that bureau believed there was a
violation of existing laws.
Mr.. Untermyer apparently regarded
the Curb as having violated both Sec
ton $50 of the Penal law, which de-
fines conspiracy, and section 953, which
refers to the manipulation of prices OF
securities. At the District Attorneys
Office there was also cited section 951,
which has to do with reporting or pub
fishing fictitious transactions in secur-
tiles. The conspiracy alleged, 1t was
said. would come under this clause OF
section ESQ.,:
IF two or more persons conspire
to commit an act injurious to the
public health, to public morals or to
trade or commerce, or for the perversion
oi obstruction of justice, or of the due
administration of the laws, each or them
is guilty Of inisdemeanor."
The maximum penalty on conviction
is one years imprisonment or a fine OF
$500 or both Violation of the two other
sections cited Is felony, punishable by
two years Imprisonment or fine of
$4,000 or both. There is no precedent
for criminal proceedings against any
stock exchange on the score of dealing
i'm tuhon igsttadp securities
Follows Lockwood Hearings.
It was about two weeks ago that Mr..
Untermyer and the Lockwood Commit
tee began inquiring into the merger OF
tie Republic, Midvale and Inland Steel
companies under the name Of the North
American steel Company. Among the
Witnesses were John A. Topping, chair
man OF the Republic Iron and Steel Com
pany A. c. Dinke. president OF the Mid
vale Steel and Ordnance Company :;
Thomas l.. Chadbourne, lawyer. who ar
ranged the merger, and Mortimer L..
Schifr Of Kuhn, Loeb Co., banker for
the combination.
Mr.. Untermyer tried to prove that n
profitable market-for the insders-was
being made for the stock by simultaneous
buying and selling. amounting to the
washing OF sales, but everybody ques-
toned about 1t denied It, Mr.. Schiff
testified that he did not know how his
firm purposed marketing the 505.000
shares of the stock taken by the syndi-
cate handling the merger. The next
day Mortimer Altmayer. curb broker,
testified that he had orders from Kuhn,
Loeb & Co. to buy 10000 shares at SO
soon after trading began. Emil Mos
bacher. curb broker, told of going
more than 5000 shares short.
Mr.. Schiff testified that no company
had been organized, that the amount of
authorized share capital had not been
determined. that there was no agree
ment in existence for the furnishing OF
capital and that Kuhn, Loeb & Co. was
not obligated to finance the merger. He
said he did not know how the stock was
being marketed.
Mr.. Untermyer's conclusion was that
the capitalization OF the North Amer
lean Steel Company appeared to be con-
servatives but that the curb was per
hitting" gambling in a non-existent
stock and that the public had received
no reliable information about the size.
color or conversion value of the "chips"
Il was asked to buy.