The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1932-04-26
Paid BallyhOO of
Stocks by Financial
Writers Is ReUeaIed
La Guardia Tells Probers
How Publicity Fools
Public Into Buying.


payment Of newspaper financial
writer's to promote public sale of
stocks was described to the senate
banking and currency committee
by Representative F. H. La Guardia
rep, N. " today.
He f1ourished patches of Cancelled
checks before the senate committee,
and named specific stocks.
He said he could produce wit
ness who would testify concerning
alleged expenditure of 1924, 900 to
obtain favorable publicity for
stocks being rugged for heavy pub
lie buying.
Appearing as surprise witness
in the stock market inquiry,
La Guardia, assisted by two men,
carried into the committee room q
large trunk containing scrapbooks
OF newspaper articles, cancelled
checks and other data.
Describes Publicity
He described alleged paid pub
licity operations in Savage Arms,
Indian Motorcycles, Pure Oil, Max
well Motors and other stocks.
He named financial writer's now
or formerly connected with the
Wall Street Journal, New York
Times, New York Herald Tribune.
New York Evening Post and other
papers as having received money
from one promoter of stocks.
Representative La Guardia said
his evidence was gathered during
the house market investigation.
1T has been stated that members
of the exchange had nothing to do
with promoting or ballyhooing
stock" La Guardia said.
Il am prepared to say that any
such statement is false"
La Guardia said that misstate-
ments may be profitable in forcing
stocks up or down.
How Market Is Rugged
He read from communication,
allegedly by Hornblower g. Weeks
to their customers March 3, 1882.
predicting bull market or a period
of accumulation incident to a bull
market"
La Guardia said ANY such OPP
tinistic prophecy was not justified. "
He added that the same firm
through the same medium on April
6, 1882. issued an "alibi, saying the
house passage of a stock sales tax
had been followed by shrinkage
of $4,000, 100000, and that the A. T.
& T. stock had been Debated by
$1S0,0OO,OOO.
Not only do bankers rig the
market, but when stock is to be
rugged high pressure publicity
man is obtained and retained and
the financial writer's contact him,
La Guardia said.
Tells of Bought News"
La Guardia said one publicity
man had handled sixty-one stocks
and that he was willing to appear
as witness. His name was given
as A. Newton Plummer. La Guar
ola said he had paid an aggregate
of S286,000 in Dallyhooing stocks.
Plummer was in the business about
fifteen years.
He said some of the publicity
stories reached as many as 100000
readers in 295 cities.
La Guardia outlined the Indian
motor boom in detail. He said on
Nov 30, 1929, 500 shares were traded
in at IS and it soon went to $3.50 |
After which there were publicity, |
kilograms and circulars that the |
company was under new manage
ment"
Then they started to operate
through the Boston News bureau,
he said and there was publicity in
the Wall Street journal about the I
motorcycle market being improved.
There was no real market for
at that time" La
Guardia continued, and they went
to London and purchased an air
motor that was not even in the
blueprint stage, but it had a Diesel
motor patent"
LaSheS at Pools
He told of a London Daily Mail |
story of Feb. 9, 1890. that the air
motor would make flying safer and
cheaper, and said photostatic copies
were circulated in the United /
States.
And them he said. 40 900
shares were dumped on the Amer
lean public. The motor never was
developed"
He said on Jan. II 1890. there
were $4,000 shares of Indian Motors
traded in at 512 and that on Feb.
% the range was 10 and y to 87s
on $4,000 shares.
The Big day was March 8 when
I'll ,000 shares were traded from !
II to 9 share. Then on Jan. %. /
1881, about year after the boost" |
began trading aggregated at $500
at 5is.
They were just where they had
started from La Guardia said.
and the r5yhlirffy man c,,if - ,,,n~