Evening star., 1933-11-28
W|CC|N CITES LOSS
IN FOX STOCK DEAL
Banker Concludes Testimony
as Senators Turn to De.
tr0it Tunnel Probe.
By the Associated Press.


By the Associated Press
Evidence was presented to Senate in
vestigators today that Albert H. Wig
gins Sherman Corporation lost more
than s2,OOO,OOo in pool transactions in
stock of General Theaters Equipment,
Inc, and Fox Film Corporation.
This was received after Wiggin. for
mer chairman of Chase National Bank,
had entered formal denial to the Sen
ate Banking Committee of previous
testi. ony that he sent word to Presi-
dent Hoover to mind his own bUsi-
ness.
The committee then began its in
ouiry into the financing Oh the Detroit
Canada tunnel in l929-30 by the Chase
National Bank and others. which re-
suited il big losses to investors.
The Sherman Corporation loss In
Guided $1,000 900 paid by Sherman to
the Chase Securities Corporation, when
Wiggin retired as chairman of the
Chase Bank, in settlement of claims
involving several million dollars.
Verifes PecOra Figures.
Wiggin verified figures introduced by
Ferdinand Pecora, committee counsel,
that showed his Sherman pool opera
tions in Fox film stock made $685., ,4lO
and in General TheaterS Equipment
stock lost S1.572 752-
Sherman participated in l3 pools IN
the two stocks with the Chase Securi-
ties Corporation.
It was developed that several Of the
ether participants went into bankruptcy
and the question of liability OF the
Chase Securities Corporation and Sher-
mar, for the defaults of the other
members. arose. 1t was settled by a
payment of ST 000 900 in Chase Bank
stock when Wiggin retired, it was teSti-
fed
The banker described the payment to
the committee as a gift" saying his
company had no legal liability,
The evidence showed bank attorneys
held there were two conflicting views as
TO Shermar'S liability, but pronounced
the settlement fair.
Held Responsible by Bank.
Later. however. the bank held the
Securities Corporation respG:.s.JIc Ior
the entire liabilities, running into sew
eral millions of dollars.
Pecora also introduced figures show
ing that Sherman had profits of S16l oil
frCm pool operations in other subsid
iaries of General Theaters Equipment,
the International Protector Corpora
tion and National Theater Supply Co.
tt committee concluded its EXAM
inat'o1 of Wiggin with this evidence.
Leslie w Snow, second vice president
of the Chase Bank and former officer
of Chase Securities Corporation, was
examined regarding the floating of
S8.500.000 Of debentureS and a like
amount of first mortgage bonds by the
Detroit and Canada Tunnel Co.
The Chase Securities Corporation
financed both issues
The Stock Market Committee had cyl
desea deSpite '"1 unfavorabie hs % %recommendations
ny fDGl0TrTO 0O 70 lIN earning power, |
that the bank gained control of the tun-
Vanced most of the money. and that
promoters of the enterprise made big
profits in the sale of real estate.
The Detroit Tunnel was built in 1928
to connect Detroit and Windsor. Canada
The company now is in receivership and
the Chase Bank lost money, as we'll as
the public.
Committee members said they had
evidence that engineers pointed out be-
fore the project was undertaken that it
would have to compete with an existing
bridge and ferry service and predicted
the enterprise would fail if the ferry
continued operation.
Says He Asked Help.
Fox testified last week that Claudius
Huston, former chairman of the Re-
hi No
Wiggin in 1929, on behalf of President
Hoover, to aid Fox in his financial
difficulties
Fox said Huston told him W:ggin had
sent word to Mr.. Hoover to mind his
own business and expressed resentment
at what he called the interference
Wiggin said he remembered meeting
Huston only once and that was at
large dinner at the University Club in
New York. but that Huston had never
been to his home
The banker said the dinner at which !
he met Huston was attended by Secre-
tary Lamont, former Senator Watson of
Indiana and about half a dozen noted |
WashingtonianS.
Noted for WHAT" Senator Couzens,
Republican of Michigan, asked sharply.
In the public eye" Wiggin replied.
SUiu oiuCh
Before being excused Wiggin asked
If he had any further statement, denied
his family ever had sold more Chase
stock than it had owned.
Il want to correct the impression that
has gone out that my family sold more
Chase bank stock than it owned he
said. The family, since 1927, never
owned less than 10000 shares, and
when 1 left the bank this had increased !
to 100000"
Fecora said this referred to previous
testimony that when Sherman made !
sales of the stock it covered by subse-
quent purchases, and described this /
as selling against the box
Wlggin SAID that was correct He
also explained the Chase Bank sold |
the Dahl shares of Brooklyn Manhat- |
tan Transit in 1881, just before it
passed a dividend, to liquidate a loan
to Gerhard M. Dahl. chairman of the |
Board of Brooklyn Manhattan Tran
sit.
Dahl protested the sale, he said. His |
stock had been given as loan collateral |
to the Chase Bank.
Wlggin said the reasons for the sale |
were that there had been a gradual |
sinking" in price of the stock and |
$l3,000,000 of its notes held by the !
public were coming due.
The bank, for its own protection |
thought the sale was the right thing |
to CO." Wiggin added.
A. B. c. BLOCKS PLAN