Evening star., 1939-02-10
BY JOHN C. HENRY.

Dy voAAAN W 4AG4N"4s
Inquiry by the Monopoly Commit
tee into election falsif1cations by
agents of the Metropolitan Life In
surance Co. ended abruptly today
as counsel for the firm announced
1t was undertaking a thorough in
vestigation of its own and would
take appropriate action Ito make
sure no such practice will ever OBJ
tain in any election of this COM
pany"
The company announcement which
Immediately preceded termination of
hearings on this particular issue ex-
pressed doubt that the ballot forg-
cries has been a general practice, as
had been indicated through testi-
mony Of more than a dozen agents
from a half dozen Offices. However,
Chairman Douglas of the Securities
and Exchange Commission later de-
clared the commission could put on
another 100 witnesses to attest SINH
larlv. He said sufficient evidence
had been accumulated Ito demon
strate clearly that as far as this
company is concerned, mutually is
a sheer myth"
This rather spectacular conclusion
Of this phase of the committees in
quiry into Metropolitan came as
Gerhard Gesell, S. E. c. examiner,
started to put on another agent to
testify in similar vein about ballot
forgeries An executive session and
several informal conferences with
Metropolitan officials had preceded
opening Of the meeting.
Gesell Ready to Testify.
As the first witness walked for
ward, however, Acting Chairman
Summers inquired if his testimony
was to deal with the same subject
as that of yesterday. On being
answered in the affirmative by Mr..
Gesell. the chairman said 1t was the
feeling of the committee that fur
ther testimony of that nature would
be merely cumulative" and unneces-
sary.
John Lord O'Brian, counsel for
Metropolitan, then arose to disclose
the companys intention to clean its
own house in this regard. His pro-
nouncement follows:
Testimony given yesterday indi-
Gates that certain of the witnesses
have signed without authority the
names of policyholders to ballots
cast in the biennial elections of the
company.
The elections are held in strict
conformance with the laws of the
State of New York That statute
requires the management to nomi-
nate ticket and gives the privilege
to policyholders to nominate an op-
posing ticket. Under this statute, II
no opposing ticket is placed In nomi-
nation, there can be no contest in
the election.
I'm the last 30 years there has
never been any contested election,
nor has there been any criticism of
the management of the company
1t is. therefore, apparent that the
witnesses who say that they signed
these names of these policyholders
did not by so doing in any way effect
the outcome Of the election.
Called Reprehensible.
Nevertheless, the signing of these
names without the authority OF
policyholders was, as the president
Of the company, Mr. Leroy A. Lin
coin, has said, utterly reprehensible
No responsible officer of this COM
pany has ever heard Of this prac-
tice and we are satisfied that the
great body Of our agents have not
engaged in it.
From the outset of this inquiry
we have co-operated to the fullest
extent in the work of this commit
tee. We shall continue that policy
AS to this particular matter, we shall
make a thorough investigation and
see to 1t that appropriate action is
taken to make sure that no such
practice will ever obtain in any elec-
ton of this company"
questioned later by reporters Mr.
Douglas insisted the S. E. c. is pre-
pared If necessary to dispel any
doubt about the forgeries being part
OF widespread practice but added
the opinion that "the evidence pre-.
sented to date is, in my opinion
sufficient to establish the existence
OF a widespread custom of tamper.
ing with ballots.
That fact, together with the evi.
dence earlier presented on the self.
perpetuation of the management
and the practical impossibility Of
putting up rival non-manageria
slate. clearly demonstrates that a!
far as the election of directors ir
this company is concerned mutual.
ity is a sheer myth.
Custom of Saving Time.
Since in terms of actual prac.
tlce there can be no rival slate the
truth is that this ballot gathering
occurs after the election has beer
held. The whole purpose of collect.
ing these ballots is window dress.
ing for the management's self-elec-
ton.
Inevitably. the agents who knew
how useless these ballots were. de-
veloped custom of saving time by
signing them for one another. As
one of them said, no one was hurt
because it would have done nc
policy holder any good to cast q
ballot.
"The evidence, therefore, shows
that the whole election machinery
Is a mockery of true mutually. II
knocks into cooked hat any argu-
ment that it is anything more than
that"
With particular emphasis, how
ever, the S. E. C. chairman pointed
out that the disclosures in this par
ticular direction constitute mo re-
f1ection on the financial condition
Of the company, nor upon the in
tegrity of the legal reserves nor that