Twin city review. [volume] (Champaign, Ill.) 19??-1929, 1922-12-15
FAKE COOP
SOCITEIES AGAIN
BECOME ACTIVE


..m hs remembered that a fake
-. calling itself the Co,opersuse
sz..sfF OF america, swindled lNlh
- 6eople cut OF thousands OF DOL
~ sear OF 50 ago. Several sollc-
iais or the concern were arrested
l.o.z z.;.Iafiou Of the blue sky law and
4oi Ter released when they PAID
~ re money collected TO those VINO
Dan pa.assd Il. Inc company was
as..'-'5 ~ 5gsstrained from doing business
ia i,l.,'s MI people who are inclined to-
eo-apefation will DO well 10
hai4 80 with the Twin City Co
aa.,'. ...sf,ve Society, n. First street,
YF.5sgaign. which is organized unser
~. par5dale system OF cooperation,
0' which has been conducting a
aiils...sfal al business Tor over three
years. - haon issued 10 the
,abiie by me Co-operatVe League,
- national protective association Oh
s,1.nefatiyes, with headquarters IN
~ York. that various fake CO.
oagat,yss are renewing their stock
t'1,1g activities all over the country.
s.i,i,aas ot dollars have already been
- tbrouath promotion schemes call
~ fnemselves cooperative, but nav
.,.S nothing in common with genuine
cooperative societies.
Ona nf the most active promouoh
sebames now or loot Is flttspurgh
seacern calling itself The Co-opera-
IN League oil America, but having
- connection whatsoever with the
nonnine w federation in New York. The
s,,,snprpn concern is now beng M
,estIgafed BY officials Of New YORK
ets,e for alleged violation OF the
iaSs Il is reported that they are at
tempting to DO u building ana ioal
busness without conforming TO ths
law. and that they are violating the
cooperative Laws.
The Pittsburgh "Co-opefatVe
Isaeue is managed by three self
anpelnted trustees, who have absolute
cdfPt,ol over the business. Those who
eenfrbuta the funds of the concern
have no vote and no control. They
orc raonired to pay installments on
raptracts. which are claimed to en-
tite members TO loans at u $40 IN
taerst rate. However, the members
are not paid interest on the money
they nut into the concern, and they
cannot secure loans when they desire
them.
On the ground that they were not
doing business lawfully, Attorney
General Brundage of Illinois filed suit
10 preyent the Pittsburgh "Co-opera-
five League from doing business IN
this state. The promoting outnt In
March 1922 got into trouble In WIS
eoDsn, and their recent attempt 10
secure the sanction of the Provincial
legislature in Ontario, Canada, met
with failure. Provincial Secretary IL.
C. Nixon, in giving his legal opinion
to the Legislature on the Pittsburgh
League, said: In my view the Com
mon Law Corporation is a most dan
gerous form of organization to be al
loved to carry on business in the
Province, in view of the fact that 1t
is made by certain people entering
into a syndicate agreement with
rights and liabilities as defined by
such agreement, and not subject to
any restrictive legislation such as is
the case with compapies Incorporated
under a Companies Act This, OF
course, means that there is no gov
emmental supervision and that the
opportunities for abuse are to that
extent amplitied."
Other promotion concerns are also
attempting to collect millions of dol
lars 70 rsehemes which are not CO.
operative, and are highly speculative
at best. The public is warned not to
invest in so-called cooperative enter
prses unless they conform to the fol-
lowing basic principles of Co-opera-
ton: u Every member has one
vote, and only one vote, officers being
elected, and subject to recall, by the
members, ~ Limitation of inter-
est paid on capital to the legal rate.
lS) Earnings to be divided among
members not on the basis of share
holdings, but according to their pa
tronage. The genuine Cooperative
League, with offices at 167 W. 18th
st., New York City, maintains free
information department which warns
investors against fake "co-operative"
schemes