The New York herald., 1922-06-14
New York Stock Exchange
ASsailed by Lawyer as
Needing Correction.
PAST TRADES MADE VOID
Restriction Is First Imposed
Though when Issued Stock
Is Traditional Paper.

Under threat or indictment on
charges Of conspiracy and price ma
nipuation, the governors of the New
York Curb Market Association decided
last evening to stop trading in the
when issued" stock of the new North
American Steel Company.
This decision followed an announce
ment that the Grand Jury of New
York county, with Samuel Untermyer
as its legal adviser. would meet to-
day to receive evidence against the
governors. members of the listing COM
mittee and other officers Of the curb
exchange.
About fifty subp9nas had been Is
sued. 1t had been believed that Mr..
Untermyer would try to have indict-
ments returned before o'clock on
Saturday afternoon. when he will leave
for Europe.
Mr.. Untermyer. who in hearings OF the
Lockwood Committee had assailed the
methods employed in creating market
for the phantom securities OF the big
steel merger notified the Curb Associa-
facts befcre the Grand Jury IL trading
in North American Steel on a when. IL
or as issued" basis without full details OF
the merger having been made public was
not ended.
On Monday Alfred 3. Sturges. secre-
tary OF the Curb exchange, notified Mr..
Untermyer In effect that the trading
would go on.
Grand Jury Not to Act.
Yesterday Mr.. Untermyer talked with
District Attorney Banton. and the Begin
ming of Grand Jury proceedings was set
for IL o'clock this morning The capitu-
lation Of the exchange means that the
Grand Jury will not act.
In statement on hearing of the de-
cision of the Curb brokers Mr. Inter
myer said the New York Stock Ex-
change has "ali it's life been doing" the
things of which the Curb exchange Is
accused He went on
"Soon4r or later the exchange New
York Stock Exchanged will have TO SUR
render and give the public peep In:
1t might better do so now than to nnd
itself in this same kind of a jam and be
forced to capitulate to the demands tor
publicity ard fair dealing"
IL took some time to get the board or
governors Of the Curb together after
market hours with their counsel. W. A.
Lockwood of Rumsey & Morgan, but a
quorum was rounded up late in the
afternoon. The result OF the meeting
was made known by this statement:
AT a special meeting OF the board of
governors held June 13. 1922, the follow
ing resolution was unanimously adopted:
"Resolved That the privilege TO deal
I'm the securities of the North American
Steel Company that was granted by the
listing committee on June is hereby
withdrawn. No further dealing In the
stock when issued or otherwise will be
permitted until after the corporation has
been duly organized. nor until the
amount and terms Of its capitalization
and All other details have been settled
and a complete statement thereof has
been filed with and approved by the list
ing committee.
IAN past dealings In the stock VIII be
Cancelled and annuled. except where
after the due organization OF the corpo-
ration and its issuance OF stock the
ransactions heretofore made are con-
firrned and approved in writing by the
parties thereto.
"A. B. SruRGEs, Secretary"
"TroubIe Caused to Untermyer."
Mr.. Untermyer on learning or the
adoption OF this resolution said;
what a pity these Stock Exchange
men will never take disinterested. well
meant advice except under pressure or
until It is too late. Just see what lot
Of unnecessary trouble they have caused
me in bringing them to time. The in
stlncts OF common honesty should have
prompted them to realize that any law
student by reading the Penal Code could
have told them that In authorizing gam
bling on their exchange In blind pool
in this phantom stock they were doing
an unethical and unlawful act.
THE curb must get rid OF the ooscs-
sion that because It's big brother has all
its life been doing these things the
miniature exchange can with Impunity
follow that pernicious example.
'It should know by this time that
much ls tolerated from the big toad in
a puddle which the little toad Is made
to suffer for initiating
Now. with the permission of Judge
Gieperich and the Grand Jury and with
the assent of the District Attorney,
shall refrain from further pressing It
charge II all past dealings are Cancelled
and annulled, the stock stricken from
the list and future dealings pro-
hiblted. unless when my back is turned
an attempt Is made TO revive the game.
In that event there will be some ons
here to act. and 1t will not be so easy
the next time.
"pity 90 send Them to jail"
at would be a pity TO send these men
to prison for practices. OF which this Ia
but one of the many. that have beeu
taught them by their big brother, and
that the big exchange has all these
years been following with impunity.
That reminds me again to inquire
when the Stock Exchange proposes 10
request the big bankers to dissolve the
money pool and syndicate for which
stock operations are at this moment
being conducted by the syndicate ny
ayers on big scale.
The public is entitled q
whether they are buying In fraY