The New York herald., 1922-02-18
Head of Firm Knew Moth
inc of Brokerage Busi-
ness. 1t Is Said.
THREE CENTS ON DOLLAR
Customers of Concern Will
Get Little of S4, 100000
They Poured In.

How the bankrupt brokerage house
Of f. D. DER G. Co, which failed re-
Gently for $4,O00,000, squandered a
fortune in one year on magnificent
Offices, wild speculation, eXtravagant
salaries and inside peculation was un-
folded yesterday at a hearing before
special United States Commissioner
Gilchrist.
Dier & Co. are expected to pay about
cents on the dollar. Their 5000 GUS
toners are virtually cleaned out.
One OF the most amazing revelations
was the manner in which three of the
firms ''insiders" were said to have
luggled the now vanished assets. Fred
Andrews known as real head" of
The firm, was examined by Arthur G..
Hays, counsel for the receiver. in re-
gard to Ben Franklin Shrimpton. an
other one of the real heads"
Shrimpton. the witness thought, had
made enough money so he would not
have to work again. He is believed
10 have gone to Canada. Mrs. Ida De-
inc, who with her husband lived in the
same house with Shrimpton and his
Wife in Mount Vernon, N Y. testified
she came home the night the Dier firm
crashed and found Mrs Shrimpton, her
sister, packing up for sudden trip
She denied knowledge of their destina
lion
Firm Robbed Blind, He Says.
L. Franklin Gaines. an employee of
Dier & Co, gave his opinion that the
firm had been robbed blind" Mr..
Hays asked him what in his judgment
was the reason for the failure.
"Dier had absolutely no knowledge Of
the brokerage business" he replied. He
was taken advantage Of, and l. might
quote a man that was interested in
way with him-Ross Robertson-that he
was robbed blind
Hays: BY whom?
Gaines: By those in charge OF the
business
HAYS; Who were they?
Gaines: Well, they were originally
in the, business. when it started. there
were four: IShrimpton, Clinch.. Raynor
and Gum. Raynor had charge of the
correspondence, Gunr had charge of the
advertising. Clinch had charge OF the
Offices and the new business. Shrimpton
had charge of the brokerage-execution
of all the orders. Andrews was
cashier. And when so New street was
first opened up told Dier that the first
and most important thing to get was
u cash position every day. To my
knowledge he never had got cash po-
siton-never had any of them. And l
know / have heard em say that, "Well.
] am going to run this business my
end of it. as / see fit, or / am going to
quit"
His own Way or He'd Quit.
Hays-Who said that?
Gaines-Mr. Clinch.
Hays-In your presence?
Gaines-In my presence. several times.
Not only that, but II will take all the
business with me-" Clnch had charge
of all the business all the production
end. as they call it-branch offices and
all the customers men and correspon-
dents.
Hays-So the best information you
have and your judgment is that the
business was robbed from the inside?
Ganes-Yes, sir. / naturally sup
posed so.
A large present" was made to Mar
tim Charles a. Stoneham's Chicago man
ager. about the time of the arrangement
between Stoneham and DER, testified
Andrews. This was in consideration of
Martins transferring his services to
DER & Co, he said.
When Col Henry ID. Hughes left the