FAKE TURFMEN INDICTED.

Gambling and Bookmaking Charged Against the "Get-Rich-Quick" Syndicates, Including Bennett's.

True bills were voted against proprietors of "get-rich-quick" turf concerns by the grand jury. Indictments were returned in court, and capiases for the arrest of the accused persons placed in the hands of the sheriff. Those against whom bills were voted are:

Frank E. Stone, alias Eddie Dunne, Security Savings Society, for bookmaking. W. R. Bennett, Security Savings Society, for bookmaking. W. I Bennett, Security Savings Society, for bookmaking. D. W. Moody, Security Savings Society, for bookmaking. Louis Morrison, alias L. M. Morrison, Co-Operative Trust Company, for bookmaking. Edwin E. Farley, for keeping a common gaming house and poolroom. Charles Carroll, for keeping a common gaming house and poolroom. J. W. Turner, alias J. W. Taylor, for keeping a common gaming house and poolroom. Miss S. Beck, stenographer for W. R. Bennett, for bookmaking.

One puzzling feature of the prosecution of the turf people is that although the bills accuse them of keeping common gaming houses and operating poolrooms, officers and lawyers interested in the cases say the promoters of the concerns never really attempted to win their advertised profits by betting on the races. It has been alleged that not one of them speculated with deposits, but simply sent dividends back to investors out of their own money. It is now suggested that the accused persons will either have to admit they were gambling or confess that their alluring statements about winnings on the race tracks were glittering frauds.

The turf swindle was prosperous until February, 1903, when the crash among the St. Louis contingent precipitated a "run" on all of the concerns then in operation. As it was not the policy of the swindlers to pay, they either closed their doors and fled or the police conveniently interfered with their business.

Prior to the crash at St. Louis there were several notable failures and disappearances. On July 9, 1902, the Al Fetzer Co., of Hammond, Ind., "failed," and about a week prior Turf Commissioner W. W. O'Hara, of Cincinnati, absconded. Both of these events shattered many dreams of riches. In the Fetzer case heavy rains were said to have broken the sure-thing combination by which the company was to win fortunes from bookmakers on the race tracks.

The amounts lost by the credulous investors in Fetzer's scheme, which, it was declared, "could not lose," reached into the hundreds of thousands. The towns that suffered the most were Hammond, Ind., and Appleton, Wis. It was reported that the people of the latter town had suffered to the extent of $50,000, and dozens of small cities are believed to have fared almost as badly.

The clients of the concern in Appleton included a number of well-known business men and people of all classes. They lost from $25 to $200 each. A poor widow who had put in all her savings was left penniless and was obliged to seek aid from the city authorities.

Fetzer conducted a large part of his business through the mails. He advertised extensively in the newspapers and found many who were willing to "play the game." Dividends of $5 a week for $100 invested were promised and were paid punctually up to about July 1, 1902. He said he had a system of playing the races that could not be beaten, and the success of the early investors convinced the doubting ones that his system was all right. The information of the "snap" spread rapidly and Fetzer's business increased accordingly. No one thought that dividends of 260 per cent were improbable when they read of the "long shots" that won races on the Chicago tracks.

Fetzer attributed the downfall of his business to the rainy weather and said that he had been unsuccessful in picking "mudders." His system of betting, which was to make everyone rich by the end of the summer, went to pieces with each succeeding thunder shower, and the investors received the doleful information that the company had lost its own capital, as well as the money entrusted to it.

An investigation into the affairs of O'Hara at Cincinnati revealed a state of affairs almost beyond belief. More than 4,000 letters which were received within a week after O'Hara's disappearance were opened. They were from every state in the country, and many were from Canada. Amounts from $5 to $500 in checks and mail and express orders were enclosed. The total amount of the money in the letters opened was $5,518, and Inspector Holmes stated that O'Hara got away with $7,500 which came in the mail the same week, making a total of over $12,000 for one week's business. O'Hara's books showed that from July, 1900, when he commenced operations, until he skipped out in June, 1902, he had received from credulous "investors" the enormous sum of $465,000.

The inevitable crash came early in February, 1903, and the police and grand juries at Chicago, St. Louis, New York and other cities got busy, but the money had been transferred to the pockets of the swindlers, who had the choice of paying lawyers and possible fines or traveling in foreign climes until the excitement blew over.

February, 1903, Detective Clifton R. Wooldridge raided and closed the following named turf investment companies in Chicago:

Prey on Chicago Teachers.

From papers found in the Mid-Continent offices it appears this company had been doing a loan as well as an investment business. A letter addressed to Chicago school teachers invited deposits for investment on which 2-1/2 per cent monthly interest was guaranteed.

If the teachers needed money it was offered them at 3 per cent a month. The company's methods and those of the banks were compared in the letter, to the disadvantage of the banks.

Medical students, stenographers, maids in hotels, women of various classes, farmers in many sections of the country and hundreds of men in different employments in the city were disclosed as the dupes.

The following telegram from St. Louis to a Chicago paper briefly outlines the situation on the second day of the raiding there:

St. Louis, Mo., Feb. 11, 1903.—Runs were made on the E. J. Arnold Turf Investment Company, the International Investment Company, The Christie Investment Company and John J. Ryan & Co. yesterday by hundreds of men and women who during the last six months have invested their savings with these co-operative bookmaking concerns in the hope of enormous profits. The International and Christie companies paid all the stockholders who appeared, at first. Then they decamped.

Arnold & Co., in accordance with their announcement which caused the panic among the "turf speculators" yesterday, refused to pay back any stock certificates, although still claiming to be perfectly solvent, and determined to pay the usual weekly dividends until affairs of the company are wound up.

At the offices of John J. Ryan, owner of the Newport (Ky.) Race Track, a riot was averted by the presence of the police; and the excited investors, who were reminded that their stock certificates are payable only on thirty days' notice, went off in a state of rage and anxiety at once amusing and pitiful.

How Arnold Inspired Confidence.

Arnold was a wise one. He knew how to work the game. First he sent to New York and bought the famous race horse Gold Heels. This horse had won many of the great Eastern classics. He broke a tendon and was useless, but Arnold's investors did not know that. They would swear by Gold Heels. Then he caused his "bank" to issue a letter along the following lines:

American Central Trust Company.

Capital—$1,000,000. Surplus—$500,000.

S. Schnurmacher, President.
Wm. S. Simpson, First Vice-President.
Joseph Wachtel. Second Vice-President.
Franklin P. Hunkins, Third Vice-President.
Edward Bauder, Secretary and Treasurer.

Directors.

Shepard Barclay,
Edward Bauder,
G. A. Bauder,
John N. Drummond, Jr.,
Henry W. Gehner,
Morris Glaser,
Frank Griesedieck,
G. A. Gurner,
Franklin P. Hunkins,
John D. Manley,
H. I. Mills,
John A. Nies,
H. F. Powitzhy,
Leo S. Rassieur,
B. Schnurmacher,
Wm. S. Simpson,
Joseph Wachtel.

St. Louis, Mo., May 15, 1902.

To Whom It May Concern:

The firm of E. J. Arnold & Company, of this city, is one of our largest depositors, and we consider them amply responsible for every obligation they may assume.

American Central Trust Company,
By Edward Bauder,
Sec'y & Treas.

The disaster was brought about by the appointment of a committee by the Missouri legislature to investigate the "get-rich-quick" situation. St. Louis had become the haven of every conceivable class of swindlers, who swarmed there in such numbers that the legislature deemed it wise to look into the matter. What motive inspired it to take this action was a mystery. Sufficient, however, to observe that when it came to following out its own recommendation to pass laws that would drive the "get-rich-quick" companies of all kinds out of the state something stopped the legislation.

The investigation of the "get-rich-quick" concerns in Missouri by the State Senate Committee resulted in an elaborate report, which was presented March 3, 1903. This report had the following to say of the turf investment companies:

"These institutions are of modern origin. The pioneer in this field, especially in this state, seems to have been E. J. Arnold & Co. Then followed Ryan & Co., the International, The Christian Syndicate, Brolaski, Thomas Walsh, Maxim-Gay and others.

"These concerns were presumably prosperous until the examination which was begun by the grand jury, instigated by the circuit attorney of St. Louis, Hon. Joseph W. Folk, and your present committee. When the crash came, company after company closed its doors or refused to pay back to depositors on demand, and upon examination of these companies, we found them to be mere shells, with little or no money or available assets on hand, and the millions of dollars handled by them either paid out in dividends, squandered and gambled away on race tracks, or absorbed by the officers and managers of the said companies.

"The evidence discloses the fact that E. J. Arnold is supposed to be in Mexico, the books of said company being in the hands of the grand jury. So far as the search under legal process has developed, no assets of Arnold & Co., except a stock farm and stock thereon, office furniture and fixtures, and a few hundred dollars in cash, were found.

"Ryan & Company claim that they have on hand $200,000, which has been attached and garnisheed, in the hands of the depositories, and the same process has been used to take possession of the real estate holdings and other personal property.

"George A. Dice, inspector of the postoffice, in charge of the St. Louis department, testified that he had made an examination of E. J. Arnold & Co. and John J. Ryan & Co., and that on their showing Arnold & Co. had on hand $160,000 more assets than their liabilities; that two different examinations of these concerns were made by him and his deputies, and that in the last report of November and December, 1902, his report to the department recommended that they be cited to appear before the department and answer as to their liability for criminal use of the mails, and that so far as his report went they were notified that there was a case pending against them; that the ruling of the department was not in accordance with his recommendation; that from the evidence it appears that the department at Washington, by some process or other unknown to your committee, overruled the recommendations of the inspector, dismissed the cases pending against these companies, and they were allowed to proceed with their process of absorbing the people's money. Had the department at Washington acted promptly and properly upon the recommendation of the inspector, millions of dollars would have been saved to the people of the State of Missouri and other states.

"In order to protect the people who are attracted by the fair promises and the payment of extraordinary profits or dividends, and to prohibit the improper and vicious misapplication and absorption of the money of the people who confide in the representation of investment companies, your committee recommends that a law be passed which will prohibit the doing of business by said turf investment companies or other like institutions in this state."

If one should moralize on the turf swindles it would only be to repeat the old story—avarice. Nothing else explains why they are permitted to flourish and rob, and then a newspaper story and no more.

Justice, blind and decrepit, is unable to scale the insurmountable barrier of the swindlers' "bank roll." But there is still hope, for from Washington we hear from day to day that another boodler has been landed in the grand jury net—thanks to President Roosevelt, who, if he knew all, would do more.

When the last paragraph was written the finale had not been reached. But the strong arm of the federal government has at last been felt and the turf investment companies are no more. It is impossible for even the veriest sucker to be taken in by them any more, and their literature would be barred from the mails in an instant. It is all over with the turf investment companies. "Requiescat in pace." May they rest in peace.

[FAKE DRUG VENDORS.]