Evening star., 1923-06-17
BROKER CRASH DUE !
TO OIL AND MARKS
Knauth, Nachod & Kuhne
Have Ample Slow Assets,
: Eleven Million Debts.
BY the Associated Press.

BY the Associated Press.
NEW YORK, June 16.-Wall street,
in the midst of a many-sided cleanup
campaign. directed primarily at
bucketshops, was hit today by
another failure-that of Knauth,
Nachod & Kuhne, a member of the
New York Stock Exchange, and of
the New York curb market.
Boosting a record of seventy years
In the street twenty-eight of them
as members of the stock exchange,
the supposedly powerful house, with
strong German connections, was
forced into receivership with $11,000,-
600 liabilities.
A statement of the firm. however.
declared it's assets We're ample to meet
it's obligations. provided they were
administered wisely. although 1t was
admitted that large portion or them
were assets.
The failure was the first involving
stock exchange house in more than
six months. although there have been
a string of curb and consolidated eX-
change failures.
No Suspicion of Bucketing.
Unlike most of the recent failures.
there appears no suspicion on the
part of the authorities that knauth.
Nachod & Kuhne had engaged in the
popular business of bucketing orders.
Their failure. it was indicated was
due primarily to unsuccessful oil pro
motions, and in a lesser degree to the
falling market for German marks, in
which they were the most extensive
dealers in America.
Besides stock broking and dealing
in foreign exchange, the firm did a
large international banking business
and it was this angle of the fallure
that appeared to give members great
concern. 1t was admitted that mum
her of travellers abroad had put their
funds into letters of credit issued by
the company and it was feared these
travellers would find themselves en-
barrassed for funds and European
banks no longer would honor the let
tcrS. Just how many such cases there
were could not be ascertained
District Attorney Banton rushed
three of his staff to the firm as soon
as news of the filing of a bankruptcy
petition reached him and they oo-
tained assurances from VI. >. Eorland,
the receiver, that he would make no
stipulations with the firm that would
prevent disclosure of their books for
his scrutiny. The firm issued state
ment declaring they would welcome
such scrutiny, as they had nothing to
conceal.
Wants Teeth I'm Rules.
Another development in the tangled
brokerage situation today was a
statement by Mr.. Bantam charging
that the stock exchange and the curb
market had put no teeth in their
recently adopted resolutions provid-
ing expulsion or suspension for any
member who refused to disclose his
records for examination in civil or
criminal action.
The teeth" that were omitted, he
said, was a provision for discipline of
members who refused to waive i'm
munity in SO disclosing their records.
He indicate hope that the two eX
changes would rectify the omission.
The bucketing situation is ex-
pected to come to d head Monday
bucketer, appears at a referees hear
ing ready, the authorities hope, to
tell ALL he knows about irregular
operations in the street. There have
been reports that Fuller. hoping to
gain leniency when he comes up for
sentence Tuesday, would make a
clean breast" involving a ring of
higher-ups, who are reputed to con-
troll most of the city's bucket shops.
Fuller was silent in his cell today as
to how far he would go in his testi-
mony.
His partner. William F. McGee. who
also pleaded guilty of bucketing. has
maintained throughout a determined
silence, declaring he pleaded guilty
only to save innocent friends from
further difficulty because of the case
Another development scheduled for
Monday in which the street evinced
great interest, a meeting of the
Consolidated Stock Exchange, at
which action was expected on a reso-
the stock exchange and the curb, re-
Quiring members to make their rec
ords accessible to the authorities
rnc ANcErrc pDnurD rarrc