New-York tribune., 1922-02-10
Federal. State and County
Officials Stirred by Re-
ports Millions Have
Been Lost by Victims
American Cotton
Exchange Accused
Charged With Masking
Suspicious Deals; Many
Other Firms Under Fire

An Intensive drive against bucket
shop operations in the financial district
has been launched by the combined
forces Of Federal, state and county
prosecutors.
The law officers also have started the
machinery moving in a wide invcstga
tiou into the causes Of recent failures
end into alleged frauds in the trading
riarts. Several cases arc already in
the hands Of : grand jury.
Assistant District Attorney jerome
Simmons said yesterday that the com
plants Of victims fecccd in "buckot-
ing manipulations had increased to
such IN eztcnt that he was preparing
t. present further evidence and ask for
indictments.
Hundreds of complaints. involving
losses said to run into millions of dol
lsrs. have heeu made to the United
States District Attorney, the Attorney
General Of he state and the District
Attorney &c affairs Of more than
twenty-five l-.ms viii be inquired into
by the grand jury, according to Mir.
Simmons
Believes Many Defraudcd
Assistant Attorney General Freder-
lex r. Rich, named by Attorney Cen
eral Newton TO conduct the states in
vestigstlon, said he Nas prepared TO
turn over complaints and evidence to
the Fedora and county prosecutors.
His preliminary investie cations. he said
led him . believe that there had been
gross violations Of Tho law and that
c'ary unsophisticated investors had
h5en muicted Of vast suins in mythical
transactions
The New York Stock Exchange and
the Consolidated Exchange are co-ou-
Grating With tho authorities in the
new ard concentrated effort to vine
out the loug-eXisting evil which, *
Sid 10 have brought poverty and mis-
ery TO hundreds.
der invest CATION by Mn Simmons is
enc against The American Cotton ~.
change, Of 81 'Broas. Street. .Ths books
o. the exchange have been subposnaed
oy the prosecutor, who said that #
their condition bore out the allegations
II the complaint and supporting atii-
davlts the case would be laid before
the grand jury.
Has zoe Members
TIE Americ.n Cotton Exchange has
about 700 members, principally in the
Soutnern cotton district It was or.
eanlz in 1918 and It's present officers
are A ". Graham. presidents Randolph
Rose vice president, and George "
Pratt. secretary. This exchange has nc
Connection with the New York Cotton
rScnangc Certificates OF mombe rshir I
In the pioneer exchange sell at about
No,00o each and 100 bales is the mini
mum trading unit, whereas seats in the
exchange against which complaint has
neen made have q par value of 81 ,oOO
escn and ten bales is the minimum
trading unit
Mr. Graham denies the charges OF
rresuaritv and declares that the at
tacs upon tho exchange is due to rival
Interests euVious Of its success
The complaint, which has been on
ME N the District Attorneys office
since las Friday, IS sworn to by Solo
mon v Quinn. former mem ber OF the
Hrn OF y. l.. Carpenter & Co. which
vas absorbed some timc ago by A. A
NouSman & Co.. of 20 Broad Street
1t IS supported by an affidavit sworn to
~ tofmcr instructor "of one of the
mehoers or the American CO ctton Ex-
s,Nange III trading and conducting their
'osineSs until learned of irregulari-
Declares 1t Is Cloak
Vn intt9rmation and belief Mr.. Quinn
ssys III Ils affidavit that "the American
Oo',on Exchange apparently is being
sssd as cloah for operating bucket
o."ona Of ny informants," states Mr..
Xuinn's affidavit. "a former member of
we INSTITUTION named, who had annie
ssppor'unity Tor observing the trans
s.."ons' q. t,' stated that 4 great majority
y, 'he transactions made across the
''"S apparently in good faith were
Continued on page four)