The Sauk Centre herald. (Sauk Centre, Stearns County, Minn.) 1886-current, 1923-01-18
EQUITY Exc. Is. in
BAD FINANCIAL WAY
DIRECTORS SEEKING PERSONAL
LOANS FROM 10000 FARM
Err STOCKHOLDERS
DEFICIT OF $72S, 100000
LOSS FROM JULY 1, 1921 TO JULY
l, 1922, PLACED AT
$15S,00O

Cooperative Exchange is in serious
financial predicament. The EQUITY
purchased the Erwin Elevator in Sank
Centre two years ago and the follow
ing story from the Minneapolis Journ-
al Of Tuesday will be of interest, as
there are a large number OF stock
holders in this vicinity:
Personal loans from the 10000
farmer stockholders of the Equity CO.
operative exchange will be sought by
the board Of directors to make up
$728,000 deficit disclosed today in an
annual report, according to an an
nouncement by the president of the
board at Fargo, where it is meetig.
There was an actual loss of $685.
600 In operation between July 81,
1921, and July 81, 1922, the report
showed, and the balance of the deficit
was said to consit of old liabilities, in
correctly accounted for in the book
keeping.
Employees of the SOC ETY. at it's
head offices in st. Paul today said
the losses occurred before last July,
When new manager, C. B. Swanson,
took charge. Since then 100000 in
operating profits have been made.
THE Equity Cooperative exchange
was started in 1911. Officials claim
it is handling 1O,OO0,0OO bushels of the
1922 crop. 20 S.
Loans by stockholders will obviate
reorganization of the society which.
would reduce the par value of the
shares substantially, the report stat
ed. .a
THE directors in their report signed
by all but one member of the board,
charged that money derived from the
sale OF grain that was pooled by farm
ers in the famous equity pool' of
1921, was diverted to conduct the
business, and that this business, be-
cause of various side enterprises and
uneconomical conduct, was run at a
loss.
"The report stated that, of the
$503 ,295.47 in grain of the last crop
that went into the pool, $1O1,916.98
due to contributing farmers has not
been paid them.
THE board recommended the sale
of Is elevators in the livestock area"
of Minnesota, which have lost money
because of too small volume of
business.
Publication by the society of the
Co-operators' Herald in Fargo is re-
sponsible for $27,555.41 Of the deficit
through operation and $40 $40 in addi-
ton because, when the paper was
abandoned, the stock of the publish
ing company was purchased by the
Equity society.
"Of the authorized bond issue Of
$500, 900 voted by the stockholders a
year ago, the report stated that only
$17,500 of the bonds had been sold,
although a portion of the balance of
/ the authorized bonds had been used
as collateral on loans to the exchange.
Although ]. M. Anderson, presi-
dent, in the autumn Of 1921, obtained
qualified promise of a $4,000, 900
loan from the War Finance Corpora
ton, not dollar was borrowed be-;
cause requirements could not be met,
officials said today.
"For several months the Equity Co
operative exchange operated live.
stock agency at South st. Paul, which
the board report said, had been
managed extravagantly, and had re-
suited in loss. The experience Of
this sideline organization led to linn
itation of the authority by the board,
of the president, Mr.. Anderson, mem
bers said today.
Proposed construction of huge
terminal at Chicago was postponed
indefinitely by the board. The report
stated that profit made by the organ
ization in the last few months indicat-
ed the exchange viii succeed in wiping
out the deficit in few years, If loans
can be obtained to tide It over the
emergency"