The New York herald., 1922-03-27
der FAILURE UNDER
FIRE BY BAN7ONNOW
Begins Criminal Inquiry to
Find What Became Of
S4,OOO,0OO Lost.
TO FIX RESPONSIBILITY
Editorial in New York Herald
and Bucket Shop Revela-
tions Praised.

Investigation OF the s4,0Oo,0oe fail
ure Of e. d. DER & Co. is under way
in the Office OF the District Attorney,
according to statement made yes
terday by Mr.. Banton. The statement
was made after the District Attorney
had read an editorial published in THE
NEW YORK HERALD on Saturday, which
suggested that criminal investiga-
tion Of the case should be made. The
statement issued by Mr.. Banton said:
"One OF the papers In its editorial
columns on Saturday suggested that
the District Attorney should start a
criminal investigation of the Dier and
similar cases. and go ahead with 1t
regardless Of where it hits. The Dis
trict Attorney of New York county
has not only started but is prosecuting
suck an investigation vigorously. This
investigation is based upon claims
filed in this office against members of
the firm Of Dier & Co.
"One OF the first steps In making this
investigation was to issue subpoena for
the books Of DER & Co. This move was
countered by motion made by DER
In the United States District Court for
the Southern District OF New York TO
restrain the District Attorney from taxi
ing and to restrain the receiver OF Dier
& Co. from delivering to the District At
torney. the books of der & Co. Judge
Learned Hand denied this motion and ]
expect the order to be entered early
this coming week.
To Seek Restraining Order.
"The attorneys for Dior & Co have
notified me that their next move would
be to obtain a restraining order from
the Circuit Court of Appeals, pending the
appeal or Dier from the decision of
Judge Learned Hand. 1t is next to i'm
possible to prove that crime has been
committed by any members of the Arm
OF DER & Co. or any others connected
with them without these books.
This only goes to show the absolute
necessity of having laws in this State
which win put brokers under the con-
troll Of the Banking Department or some
like department, and place their records
at the disposal of public officers at all
times. 1t is reported that Dier & Co. IS
liabilities are $5.o0o.000 and that their
assets are about 100000. or per cent.
OF their liabilities. Can any one imagine
bank or insurance company falling
with such a difference between its assets
and liabilities as this?"
Mr.. Banton then went on TO say that
his Office also had been temporarily re-
strained from examining the books of
5. s. Rpskay Co.. and that Judge
Learned Hand had referred the matter
to Special Master Parlun to report
whether the members OF the firm of s. 8
Ruskay G. Co. had waived their consti.
tutional privileges when tho books az
that firm were delivered to the receiver
in bankruptcy.
VIII Seize Books II Needed.
Nothing but constitutional barrie,
will keep the District Attorney or New
York county from taking the books ot
brokers and prosecuting those sgains
whom he finds evidence OF violation ot
the laws OF this State" Mr.. Banton said
"Of course. II Is necessary. to provs
larceny and that a person who receive,
stolen goods or money knew that thu
goods were stolen in order to conyic,
such person of receiving stolen goods
The suggestion contained in the cdi
torial mentioned Is a good one, and thu
District Attorney will act upon 1t ii
each case"
While the District Attorneys omc,
searches for evidence that a crime wa,
committed in the DER case and the at
torney for the receiver. Manfred W
Enrich endeavors to increase their $500.
600 creditors fund by bringing pressur,
to bear on certain members of the bank
ruptsy brokerage house, the creditor,
and their attorneys are planning on TAX.
ing steps to supplement the work of tn,
two other agencies investigating tn,
failure. The mass meeting of creditors
OF three committees now consolidated
will be held at Bryant Hall on wednes
day evening. and II Is expected thai
more than 1000 Dier creditors will at
tend. At that time the offers OF Charlie,
A. Stoneham. Elmore d. DER. Fred An
drews and others connected with tn.
case will be discussed and a defnit,
policy will be determined by the cred
itors.
Creditors Want No Charity.
new httituue on tne part OF SCmt
creditors became known yesterday wher
o. y. Carpenter OF 154 Nassau street
representing several persons to whom
money Is due, said that the offer o.
100000 from Charles A. Stonchan
ehould not be accepted. and that II 4
was as has been stated by the Stone
ham counsel, merely contribution 81
a matter OF feeling of moral obliga.
ton to Mr.. Stoneham's former custom.
ers, the offer should be rejected. as the
creditors do not want to become char
ity takers" IL. on the other hand, Mr.
Carpenter said, there was any evidenc,
or knowledge on the part OF Mr.. Stone
ham that he was turning over his &C
counts to an insolvent concern he shoult
be prosecuted and no settlement 10,
5000. 600 should be considered.
I'm short" Mr.. Carpenter said
either Mr.. stoneham is deeply con.
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