Evening star., 1932-04-26

(COnLlnQeQ from cISt FdSc.I
bill offered by the House Ways and
Means Committee.
The circular read by the witness esti-
mated the market drop following the
tax approval at between S2,OOO,0OO, 600
and $4,000, ,000, 900.
Virtually the full committee was on
hand after La Guardia had begun his
testimony, but william A. Gray, the
counsel, was not present. Committee
members questioned La Guardia closely.
La Guardia said Whitney had testi-
fed before the House Committee that
regulation of the exchange by statute
Is not necessary, contending that they
maintain complete control over their
men,
ct say that statement is not true"
said La Guardia, "and Mr.. whitney
knew 1t was not true when he made 1t. I"
Held Court Was Wrong.
He cited a case In which a court
Judgment was rendered against Wall
Street firm for fraud and said Whitney,
when reminded of this, said the court
was wrong and the exchange was right"
Not only do brokers rig the market"
La Guardia said, "but they speculate in
stocks in which their members are di-
rectors"
ct shall deliver proof that when the
stocks are selected to be rigged, high
pressure publicity men are hired to
write the stuff"
La Guardia then named several
financial writer's who, he said, were
given checks for writing stories por-
traying Savage Arms stock in q ia
vorable light. This La Guardia de-
scribed as part of the ballyhoo."
Shows Series Of Checks.
He held UP before the committee q
series of checks bearing 1924 dates and
signed, he said, by Plummer.
Two for $50 each, he said, were
asserted, was then on the New York
Herald Tribune"
Another for s14o.o2, he said, was
made out to w. j. Gomber. then on the
Financial American.
Numerous other checks, he said, were
"given to the pay of man, who stated
he paid them to other financial writers
who were ticklish about taking checks" !"
He told the committee he did not
wish to disclose the name of the pay
of man at this time"
Describing what he referred to as
ballyhoo, La Guardia said 605 stories
calculated to induce the public to buy
stocks were circulated in 208 newspa-
pers, with II 100000 circulation in 157
cities with population of 32,00o,000.
duplicates Other Writers.
La Guardia also presented a check
for $3.50 which he said was indorsed
by Richard Edmonston, then with the
Wall Street Journal, as part Of a second
ballyhoo on Savage Arms.
He offered a check Of S184 made out
December 5, 1924, and described as in
dorsed by Charles T. Murphy of the
New York Evening Mail
The Evening Mail was consolidated
with the New York Telegram on jan
uary "a, 1924. An immediate check
of the identity of the person to whom
the check was made out was not avail
able.
check of 5000 to Gomber and a
5000 check Endorsed by w. F. Wamsley,
then of the New York Times, then were
described by La Guardia.
II am sure he deceived his own
editors" La Guardia said.
The Representative then told Of
ballyhoo in Pure OIL" stock, the name
of which drew laugh from the COM
mittee
He told of three checks for $40o, $500
and $500 drawn in January, 1925, for
this stock and given to the pay-off man.
Other checks presented were $468
ndorsed by Edmonston, checks of $l00
and $184 to j. w. Walker, of the Herald
Tribune, $275 to William White of the
Evening Post and s284 to Gomber.
La Guardia read a letter to Plummer
from Oscar L. Gubelman of 81 Broad
way, in 1925. offering him a 30-day
option on 500 shares of Pure Oil at IS.
IF the price went up he collected?"
asked Senator Barkley
He couldn't lose. I understand all
these deals were profitable" said La
Guardia.
La Guardia then presented a $1,000
check made out to George F. Breen,
publicity man for Sinms Petroleum.
Names Brokerage House.
The brokerage house that employed
Plummer IN the Savage arms case was
jackson brothers, La Guardia said.
The Chase Securities Corporation
employed him for the Pure Oil stock
the witness said.
La Guardia said Maxwell Motors
Corporation paid $500 each to nine
writer's.
while the publicity was going out
boosting up the stock" he explained,
talxin of his glasses to address the
committee, the corporation was send
ing out letters to its stockholders ad-
vising them to hold the stock. So there
was no dumping Of stock on the mar
ket as the boom went on"
He said the Chase Securities Corpora.
Jon handled the stock. and the Maxwell