The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1932-04-26
La GUARDIA Shows
HOW STOCK PRICES
ARE MADE TO RISE
Says Brokers interested in Plots
Hire Financial Writers to
Aid Them
EXHIBITS CHECKS AS PROOF
Tells OF Amounts Paid and
Gives Names Of Men Who
Received Money

washington, April 26.-(FeRepre.
sentative La Guardia Of New York
charged Tuesday before the senate
banking committee that on occasion
brokers wanting to boost the price of
certain stocks had paid writer's on
financial topics to ballyhoo those Sc
curities.
Appearing as surprise witness. the
Dynamic New York Republican,
brought along two trunks filled with
papers, some Of which were circulars
sent out by financial houses advising
their clients to buy In anticipation Of
bull market.
He said A. Newton Plummer. q
publicity counsel, had paid out $685.
200 to financial writer's for publicity
ana that he had checks to show where
$11l,OOO OF the amount was paid.
RUNNER was employed in one case.
LaGuardia said. by the Chase Secur-
tiles corporation, which, he added. il
AFFILIATED with the Chase National
bank.
Speaking with emphasis La Guardia
told the committee it had been stat
ed by a responsible official Of the
New York stock exchange" before q
committee that the exchange and its
membership ARE such that they have
absolutely nothing to do with the
promotion OF stocks. the ballyhooing
Of stocks"
Challenges Statement
His voice rising. the witness assert.
ed that ANY such statement is deli
berately false"
He added that "misstatements are
profitable"
"Misstatements" he said, may send
the market up or down."
The circular read by the witness es-
timated the market drop following the
approval Of a tax on stock transfers
at between $4,000, 900 900 and $3,o0o,-
DOC, 1000.
La Guardia said President Richard
Whitney of the New York stock ex-
change had testified before the house
committee that regulation of the ex-
change by statute is not necessary,
contending that they maintain COM
plete control over their men,"
Il say that statement is not true"
said La Guardia, land Mr.. Whitney
knew 1t was not true when he made
it,"
He cited a case in which q court
judgment was rendered against q Wall
Street firm for fraud and said Whit
ney, when reminded Of this, said the
court was wrong and the exchange
was right"
The New York representative said
A. Newton Plummer. a publicity
counsel, had paid out $3.50, 900 to fl
nancial writer's for publicity.
La Guardia said he had checks to
show where $l71 900 was paid but that
Plummer would not reveal the others
because some are dead and others are
out Of job.
Will Deliver Proof
Il shall deliver proof that when
the stocks are selected to be rugged,
publicity men are
hired to write the stuff"
The representative then named
several financial writer's who he said
were given checks for writing stories
portraying Savage Arms stock In q
favorable light.
This LaGuardia described as part
VI CIAc Udl1yI1OO.
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
made out to j. F. Lawther, who, he
asserted, was then on the New York
Herald Tribune"
Another for $4,000, he said, was
made out to w. J. Jomper, then on
the Financial America.
Numerous other checks. he said.
were given to pay off men who
stated he paid them to other finan-
cial writer's who were ticklish about
taking checks"
He told the committee he did not
wish to disclose the name Of the pay
Oft man at this time"
Describing what he referred to as
ballyhoo, LaGuardia said COS stories
calculated to induce the public to
buy stocks were circulated in 200
newspapers, with 100000 circula.
ton in 157 cities with population Of
81, DOC, 900.
while the publicity was going out
boosting up Pure OIL Stock" he said.
taking Oft his glasses to address the
committee. "the corporation was send
ing out letters to its stockholders adj
vising them to hold the stock. So
there was no dumping Of stock on the
market as the boom went on"