The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1932-03-21
F0SHAY AND AIDE
ARE CONVICTED IN
MAIL FRAUD CASE
Minneapolis Promoter Is Sen.
fenced to 15.Year Term
at LeavenWorth
FOUND GUILTY BY JURY
TaIesmen, All Men, Find Four
OF ~ Indictments Were
Justified
FOUND GUILTY BY JURY

minneapolis, March 2l.-(P)-Wil-
bur B. Foshay and H. H. Henley,
founders Of the Foshay enterprises,
were convicted on four OF II counts Of
using the mails to defraud by q feder-
al court jury Monday.
Judge Joseph w. Molyneaux imme-
diately sentenced each to serve an
aggregate Of Is years In the federal
penitentiary at Leavenworth, Kansas,
and to pay fine of $1,000 each, with
q stay of AZ days in which to move
for appeal.
The jury. the second to hear the
case, returned the verdict in its sixth
day of consideration. The first Jury
last fall disagreed.
F'oshay and Henley showed no sign
Of emotion. AS Henley heard the SEN
tence he chewed gum. Foshay, gray
haired, smiled when he was permitted
to leave the courtroom after the
court released them by continuing
appearance bonds in force.
Began Business In 1917
The verdict wrote another chapter
In the dramatic life of Foshay who in
1917 after career as an art studen:
at Columbia university, as a clerk and
minor executive with utilities compa-
mics, established his own business
here In one-room office.
Buying small utilities properties in
rural sections on the part payment
plan, he began marketing securities
on small scale but with steady Sue
cess. Then he branched out, added
Henley as his chief assistant, and ex-
pa1fded speedily In 1928. and In 1927
and 1928 marketed his own securities
at the rate of more than $780, 900
monthly.
In 1929. his sales dropped. and he
was forced to make loans at high in
terest rates. Finally after the defla-
ton of securities values in October
1929, his holding company with num-
erouS subsidiaries were unable to
make further loans and a receivership
was ordered on Nov. /, 1929. Foshay
properties were credited with a value
Of more than $50,000.000 at one time
but the government In the trial
claimed the promoters consistently
exaggerated values to stockholders
and prospective investors.
Josiah Brill, defense attorney, said
he would appeal Before doing this
he said he would require q rest after
the trial, which began its 18th week
Monday. The first trial lasted eight
weeks, ending in disagreement Of the
jury when the only woman member OF
the panel made solitary stand for
acquittal.
Guilty Of Contempt
Later this woman. Mrs. Genevieve
A. Clark. Minneapolis housewife. was
found In contempt Of court on
grounds she had failed to reveal when
examined as juror that she was
former Foshay employee.
She has appealed this finding.
which resulted In a sentence Of six
months in jail and a fine of $1,000.
The five defendants In the Foshay
mail fraud case who ended their fight
before the second trial started by en-
tering pleas Of guilty or nolo conten-
dere early In January will hear the
sentence Of Judge Molyneaux April 2.
H. E. McGinty. former secretary
and treasurer Of the Foshay enter
prises. and Clarence Salisbury. former
vice president and sales manager.
went before Judge Molyneaux Jan.
6 and pleaded guilty to the first count
Of the 17-count indictments. It was
the same indictment on which Fostay
and Henley were found guilty.
Palmer v. Marby and Herbert F.
WEIGH. former assistant secretaries.
and r. ]. Andr,ls, former president OF
public utilities consolidated cor.
poration, entered pleas OF nolo con-
tendere to the same indictment Jan.
9. A plea Of nolo contendere Is
treated by the court as plea Of
guilty.