The Omaha morning bee. [volume] (Omaha [Neb.]) 1922-1927, 1923-04-07
Wildcat Oil
Under Fire
Millions FiIched From Public
Through Sale of Fake Stock,
Report to Postmaster
General Says.
Government Plans Action

Washington, April 6.-0l stock
promoters operating in the state or
Texas during the last five years have
1lched more than 100000 900 from
the public. Postmaster General New
was advised by John II. Edwards. so-
licitor Of the po-toHice department,
and Chief Postal Inspector Simmons,
who are in Fort Worth cooperating
with the Department of Justice in the
prosecution Of mail fraud cases in
volving oil promoters.
In making public the report. Post
master General New also declared the
Postoffice department intended to
move in the rfost vigorous and per-
sistent mannet possible for the err
forcement Of both the criminal law
and the fraud statutes against the
fraudulent use of the mails, not only
in the sale OF fraudulent oil stocks
but all other cases involving fraud in
the maiis.
Government Appealed To.
Mr. New said the government had
stockholders to stop the oil stock
frauds after wildcat promoters.
had escaped prosecution by state au-
thorities. PostofIlee inspectors. he
added. have been working since last
summer on more than 200 cases. many
Of which have already gone to the
grand jury. now in session at Fort
Worth.
The report TO Mr.. New follows in
part:
More than 500. ooO, 900 IS the es-
innate placed by postoffice inspectors
upon the amount of money fiiched
from the public during the past five
years by oil stock promoters operating
in the state Of Texas. This statement
challenges the attention CT the coun-
{ try and demands speedy and certain
action. Postoffiee inspectors also re-
port that companies and syndicates
have been organized. run their course
and passed away by hundreds during
these FIVE years. leaving approx
mately 500 600 stockholders scattered
throughout the United States TO
mourn the fading Of roseate dreams
Of wealth with the final disappear
ance Of their hard-earned Dollars.
Stock Selling Schemes.
No doubt some Of these companies
were started By men who hoped TO
strike oil and make money from pro-
duction, hut in practically every casa
The promoters laid their plans 10 PROFIT
from the stock selling. regardless CT
the result Of field operations. Seldom
was II that n promoter invested any
money OF his own.
Almost all the pro.ncters' concerns
operate as common law trusts. Over
such organizations the Texas statutes
provide no supervision whatever. The
promoters appoint themselves the
trustees. with sole and unlimited
power 10 procure and handle the
money Of their investors as they
please without question from any
state authority.
To impose the penalty <or using
the mails 10 defraud. the postoTies
+ az ..--z -ls and the agents - q =
/ Department Of Justice must STOW slsf-
+ ficient evidence Of intent 10 defraud.
The department Representatives re-
Tort that the cases. especially those
F involvii.s : large sock selling sehemes.
F are the most complex and difficult TO
F handle Of all criminal cases arising ia
the federal jurisdiction. For this
E rcasca they require months ard scme-
f times years Of patient and persevcring
f investigation. "