Evening star., 1933-05-26
MORGAN'S CONTROL
OF UTILITIES SHOWN
Said to Have Been Acquired
Through BeIoW-Market-
Sale of Stock.
Continued From First Page.)

client lists IN an executive session lew
DAYS ago.
The Morgan party arrived in the
hearing room shortly after the commit
tee went into executive session. The
financier was dressed in different suit
for the fourth consecutive day. this
one being gray of much lighter hue
than the previous ones.
Members of Pecora's staff dragged
in a trunkful of papers.
Junius 8. Morgan. son of Morgan,
took a seat by his father, both appar-
emily In good hnmor. The elder COM
mented to those nearby on the op-
pressive heat of the day and the place
Extraordinary precautions once more
were taken to handle the spectators in
the expansive marble room and to bar
suspicious characters. Even the usual
police guard for Senate inquiries was
augmented.
One plainclothes man Of the Metro
politan police was assigned directly to
the task of following and guarding
Morgan, and another was assigned to
Pecora.
The committee had difficulty in
reaching quick agreement on whether
to make public the disputed data, and
an hour had elapsed before members
of the senatorial group entered the
ton.
Upon the committees decision to 60
over until next Wednesday at the end
Of today's session, the Morgan party
said it would return to New York dur
ing that period Pecora Indicated the
inquiry probably would be concluded
next week
The committee will meet later to de-
eide whether to publish the partner
ship agreement Testimony of Morgan
witnesses has shown several members
OF the firm are indebted to it.
Shortly after II am. the inquiry was
resumed, with Howard on the stand
Answers Eagerly.
Sitting to the right front Of the elder
Morgan, Howard said he became presi-
dent of the United Corporation on Feb
ruary 26, 1929. A middle-aged man.
with gray, thin hair, he testified in
sharp, clear voice.
Nearly all members of the committee
were seated around the table, leaning
forward toward the witness. Senators
wiped their browS, as perSpiration rolled.
Morgan rose to take a seat near
Chairman Fletcher at the head OF the
table on the other side from Pecora.
The loud speaker system made 1t
much easier for the big throng that
crowded the other end of the room to
hear the testimony.
Howard said that "about January ii,
1929" his corporation acquired from
Morgan & Co. 350,957 shares of COM
mon stock in Mohawk. Hudson Power,
62,360 of preference stock and ia, ,440
in option warrants.
In addition. United Corporation got
130565 shares of common stock from
Morgan in United Gas Improvement
Co., about $4,000 shares in Public
Service Of New Jersey and also $780,
600 in cash.
feved stock, 800, 900 of its common and
7l4.200 in option warrants.
What did you get this stock from
Morgan at?". Pecora asked.
Howard replied that it was acquired
at about "S12, 600, 900 less than its mar
ket value"
The witness answered Pecoras ques-
tions eagerly, as though he were anxious
to explain the whole transaction, but
questions.
What was the market value OF the
stock you received?"
1T wasn't worth the paper 1t was
printed on in 1929" interjected Glass.
Howard gave the aggregate market
value at s55.566, ,644.
rs the United Corporation holding
company?" asked Pecora-
Yes"
These securities received by the
United Corporation were those OF pub
lie utility corporations"
YES"
Morgan Had Control.
What stock was the United Cor
81 fCctt
"A total capital stock Of $4,000, 900
shares consisting of l000. 900 first pre-
ferred, 100000 preference shares and
10000 900 common"
Howard said no first preferred had
been issued He said 100000 Of the SO
preference stock had been issued, and
also 100000 shares of common, all be-
ing taken by Morgan & Co.
The firm also received $4,000 option
warrants emitting it to buy that num-
ber of common stock shares at $2750
a share.
Each share had one vote" Howard
said
WHO had control?" Pecora asked.
-. P. Morgan g. Co." Howard said
Where are the books Of your f1rm
kept?" Pecora asked. 3.
In the office Of the Morgan Co"
said Howard.
Have they been kept there since
United Corporations organizations"
YES"
"Who signs the checks?"
Since the last annual meeting-ln
February of this year-they have been
signed by myself and Mr.. Ferguson as
treasurer" Howard said.
He commented that the books were
under the supervision of Leonard
Keyes, Office manager for Morgan g.
Co., and said that prior to the February
meeting Keyes signed the checks Tor
the United Corporation.
In answer to the earlier question, he
said that the executive officers OF the
corporation at the time OF its formation
were George Roberts, president; MT.
Ewing, vice president, and Keyes, treas
urer
Office in Wilmington.
"Where is your ofice?"
In Wilmington, DEL" Howard re-
piled adding there also was an offlce at
80 Park place, Newark, N. j.
In whose Office is the business Of the
corporation done?" asked Pecora.
"All the meetings are held at 80 Park
place Newark"
How much staff do you have there?"
Senator CouZenS asked.
AN assistant secretary"
He does all the business?"
"Of course, We have discussions in
New York but the business is done at
the directors meetings in Newark, u
said Howard.
In whose Office would these discus
sions be held" Pecora wanted to know
In my Office, perhaps in Mr.
Whitneys."
You mean in Mr.. George Whitney's
Office in ]. P. Morgan g. Coz"
Yes"
where is your Officer"
7 AT IS Broad street"
1T adjoins j. P. Morgan & Coz"
| "Yes"
Howard testified Keyes kept the
United Corporation books and that he
did not know who made entries In