The New York Times stated that B. H. Scheftels & Company sold Ely Central stock to the amount of five or six millions in cash and made a profit of $3,000,000 on the transactions. The books of the Scheftels company show that the company not only made no money on the sale of Ely Central but actually lost vast sums.
The New York Times said that it had been advertised that a carload of ore had been shipped from the Ely Central mine as a sample, but that the Government had not been able to find out to whom this carload of ore was consigned. The truth was that the consignment had been made to the best-known smelter company in the United States, that the ore averaged seven per cent. copper, and that it could not have been shipped out of camp except over a single railroad which has the monopoly—an easy transaction to trace.
B. H. Scheftels & Company were accused by the New York Times of clearing up nearly $600,000 in three months on the promotion of the South Quincy Copper Company. The facts were that, after receiving $30,000 in subscriptions and returning every subscription on demand because of the slump in metallic copper, the Scheftels company abandoned the promotion and never even applied for listing of the stock in any market. A large sum was lost by the Scheftels company here.
Even in stating the penalty for misuse of the mails, which was the crime charged by the Government agent who afterwards resigned as a consequence of conduct objectionable to the Government, the New York Times stated that the punishment was five years in prison, which was more hop-skip-and-go-merry mistaking. The crime is a misdemeanor and the maximum penalty for an offense is eighteen months.
I have counted not less than five hundred unfounded and misleading statements of this kind regarding myself and associates that have been made in the past year by newspapers and press associations. The shadow has been taken for the substance.
Now, the Scheftels raid, I shall prove in due time, was the culmination of as bitterly waged a campaign of misrepresentation and financial brigandage as has ever been recorded. Chronologically an introduction of the subject is out of place here. The effect, however, of the press-agenting which formed a part of the campaign of destruction is pertinent to the topic under consideration.
The immediate result was that thousands of stockholders in the various mining companies that had been sponsored by the Scheftels company were robbed of an aggregate sum amounting into millions, which represented the ensuing decline in market value of the stocks.
The newspaper campaign of misrepresentation and villification was essential to the plans and purposes of the men who sicked the Government on to me. The final destruction of public confidence in the securities with which I was identified became necessary to justify the whole proceeding in the public mind.
On the surface of the play it was made to appear that the Government of the United States had reached out righteously for the suppression of a dangerous band of criminals. The story in the New York Times and other newspapers on the day after the raid was justification made to this end.
The fact that tens of thousands of innocent stockholders might lose their all, as a result of the foul use of powerful maladroit publicity-machinery, did not stop the conspirators for a moment. I had a youthful past and, therefore, the newspapers took little chance in publishing anything without investigation and proof that might be offered. And they went the limit, particularly those newspapers that are in the habit of permitting the use of their news columns from time to time to help along the publicity measures of powerful interests.