Evening star., 1933-11-11
QUIZ OF BROKERS
BARES PRACTICES
QUESTIONABLE Gives Senators
Comprehensive Picture of
Pool ManipuIationS.

BY the Associated Press
The most comprehensive picture ever
drawn Of pool operations and manipu-
lations on the Stock Exchange was be-
ing pieced together today by Senate
Investigators on the basis of evidence
furnished by brokers.
When completed, the Senator be-
lieve it will give a better insight into
the operations of the stock market
than even exchange officials themselves
have had, and may result in revolu-
tionary corrective legislation.
The picture was being drawn from
hundreds of brokers' answers to ques-
tionnaires sent out by the committee
few days ago.
Extending their previous plan, the
investigators sent the missionaries
not only to members of the New York
Stock Exchange, but to members of
all exchanges in the country.
Practices Disclosed.
The replies will not only provide COM
plete information on the operation of
pools and syndicates involving more
than 10000 shares of stock, but win
give the committee mass Of other in
formation on Stock Exchange practices
never before collected.
1t will show the trading activities of
specialists" who have inside informa-
ton on orders; the percentage of mar
glnal transactions; the extent to which
brokers obtain options on stock issues:
now much trading is done by brokers in
issues they have sold to the public:
growth Of the investment trust idea and
profits of the brokers.
Covers Five Years.
The qhestionnaire covers the years
1929 to 1888, inclusive.
While his assistants were working on
this data, Ferdinand Pecora. commit-
tee counsel, was studying evidence.
which he will present when hearings
are resumed Tuesday, on how the
paper empire" built up by bankers un-
der the name Of General Theaters
Equipment, Inc, collapsed with losses
OF mlll1ons to the investing public.
a HO,VVV,OOO Wrlte-up In stock of the
International Protector Co. was uncoy-
fT1itr cred by the committee Yesterday in the
Ineaters Equipment Co., now in re-
ceivership.
Operations through which 1000. 900
shares of International Protector stock
with 1922 book value were acquired in
1923 by General Theaters Eouipment
Co. for $3.50 a share were explained
by Harley Clarke, president of the hold
ing company.
Cuban Bonds Questioned.
Albert H. Wiggin, retired Chase Ma
tlonai Bank chairman, was brought
INTO the picture through his Sherman
corporation, which participated In the
G. T. e. financing after Chase Securi-
ties Corporation declined to come in.
Members of the Stock Market Com
mlttee today said the State Depart
ment records relative to Cuban loans
Dy the Chase National Bank, which
tney decided not to make public, con-
tanned frequent reference to the uues-
ton OF their legality under the Platt
amendment.
Evidence submitted to the committee
In open session disclosed Chase loans
OF $4,000, 900 were made to the Ma
cnado regime after the late Enoch
Crowder, then Ambassador to Cuba.
mad questioned the legality of a $780,
O0O, 900 loan under a provision of the
Platt amendment forbidding loans that
could not be serviced from ordinary
revenues.
Objection Waived.
The State Department files, commit
tee members said, showed Crowder
waived this objection for the first So
000, 900 loaned by the bank because of
the comparatively small size.
Committeeman added, however, that
there was little in the State Department
records that had not come out in pub
lie hearings, except material of the
same kind that was excluded from the
public hearings because it might cause
trouble in Cuba.
The correspondence told of threats to
Americans in Cuba, and contained per-
sonal views and ideas that the Senators
said they considered of little conse-
quence today.