HARDWOOD RECORD 



33 



iu this industrj'. The coffiu covered with black eloth was usually 

 made of chestnut. It has uot been especially popular of late 

 years, buyers of coffins apparently preferring the kind with the 

 wood exposed. The others are cheaper, of course, and the casket 

 manufacturers are glad enough to get away from this trade 

 and increase the sales of high-grade caskets. As the use of eloth 

 coverings becomes less and less, it may be inferred that the 

 manufacture of high-grade veneered caskets will become larger 

 and larger. Ar any rate, that is what the veneer manufacturers 

 in touch with this business appear to believe. 



"Time certainly brings changes," said a veneer e.xpert the 

 other day. '"A few vears ago I would not have thought that I'd 



be cutting veneers, for use iu the sides and tops of caskets. Nor 

 should I have ventured, even in my most hopeful moments, to 

 opine that anybody would ever consent to be buried iu a veneered 

 Circassian walnut or figured gum container. It does look a little 

 festive tor the purpose, I'll admit, but the effect is certainly beau- 

 tiful and for certain classes of trade I imagine the funeral direct- 

 ors are getting and will continue to receive a pretty steady call 

 for that cla.ss of goods. 



"At all e\('MtH, if the demand continues to grow as it has been 

 doing. I think that the casket manufacturers will soon be along- 

 siile the furniture mid piano trades as consumers of veneers." 



G. D. C. 



,'C;ros:Biaata!OT:MOTtm;>sTOi)Kro 



Editor's Note 



Iu its issue of Saturday. February 24. the North American of Philadelpliia, recites the details of the history 

 of the International Lumber & Development Company, a Mexican promotional alleged lumber and agricultural enter- 

 prise, which has been unfavorably exploited in Hardwood Kicidkd during tbe past sis years. It is a pathetic com- 

 mentary on the gullibility of human kind that the vast sum of money Involved in this crazy deal should have been 

 filched from it. Stockholders are now appealing for a receivership of the company, alleging that It is a gigantic 

 fraud. If this be demonstrated, it will be a matter of no surprise to anyone with even a modicum of knowledge 

 of the conditions involved in enterprises of this kind. The story as told by the \orth American is herewitli 

 reproduced ; 



Charging the International Lumber and Development Company with 

 being a gigantic fraud, which has cheated stockholders and the public 

 out of more than .SG. 000. 000 in the last seven years, stockholders in the 

 company yesterday petitioned Judge McPherson, iu the United States 

 district court, to appoint a receiver. 



The defendants named in the bill filed in behalf of stockholders by 

 Attorneys Owen J. Koberts and Samuel W. Cooper are : 



^^'illiam H. Armstrong, president, former United States railroad com- 

 missioner. 



.\lfred Gratz, vice-president, a member of the board of road reviews. 



Charles M. McMahon, secretar.v and treasurer, identified with several 

 other corporations similar to the defendant lumber company. 



H. A. Merrill, director, former president of the City National Bank 

 of Mason Cit.v, Iowa. 



W. W. I'usey, 2d, a director, of Wilmington. Del. 



A. G. Stewart, a director, former attorney general of Porto Rico. 



.Tohn S. Karnes, a director, justice of the Supreme Court of Nebraska. 



.lohn R. Markley and Isaiah" B. Miller. Chicago, promoters of Mexican 

 Iilantation schemes, with offices in the Fisher building. 



.\lfred L. Wanamaker. general counsel for the- defendant company. 



William II. Armstrong. Jr.. its general agent. 



Llie United Security Life Insurance and Trust Company, of 003 Chest- 

 nut street, trustee. 



The Philadelphia Real Estate and Securities Company of the Drexel 

 Building, which has sold considerable of the lumber company's stock. 



More Than $6,000,000 Involved 



I'he bill sets forth that though the money paid into the International 

 Lumber and Development Company as capital is $6,000,000, the amount 

 involved in the alleged fraud is in reality very much higher and may 

 be anywhere between $7,000,000 and $9,000,000. 



This difference between the company's capitalization and the amount 

 of the actual cash involved has been made possible because the com- 

 pany sold its stock under contracts providing for installment payments 

 of $5 a month, with a forfeiture clause for failure to make regular 

 monthly installment payments. 



But it is set out in the bill that the enormous sums forfeited by 

 people in all parrs of the world under this forfeiture clause, amounting 

 to $1,000,000 and upward, has, as a matter of fact, not been forfeited 

 to the company's treasury, but to the pockets of officers, directors and 

 agents of the company, who appropriated this forfeited money for their 

 own use. 



It is also charged that of the 20.000 shares of stock in the company, 

 only eighty-five shares were issued in the seven years in which people, 

 scattered in all parts of the world, poured their stock subscriptions 

 into the company. Of the eighty-five controlled shares, it is further set 

 forth that Markley and Miller, the two defendant promoters, controlled 

 a "majority, or forty-four shares, and that Markley and Miller by their 

 majority control entered into a contract with themselves for the Inter- 

 national Lumber and Development Company by which they were to be 

 paid $5,000,000 of the company's $6,000,000 capital. 



More Secret Contracts 



The remaining $1.000.0oO of the company's capital was paid over to 

 William H. Armstrong, Jr.. as general agent, under another secret con- 

 tract and distributed in accordance with a third secret contract between 

 Armstrong, Jr., and C. M. McMahon, seci'etary and treasurer of the com- 

 pany. 



It is further charged that, despite the enormous sums which have 

 been paid Into the company by innocent investors, it has now no more 

 assets than it had in 1900, when John R. Markley sold the property 



of the company, for $180,000. and that its dividends of $1,500,000 have 

 been paid out of money received for capital stock. 



In charging the officers and directors of the company with having 

 entered into a conspiracy to cheat and defraud their stockholders and 

 the people in general, the bill in equity says : 



"That John R. Markley and Isaiah B. Miller, individually and as 

 copartners trading as Markley & Miller, are and have been, since the 

 organization of the corporation, contractors under a certain contract, 

 hereinafter more fully set forth, as well as for seven years in control 

 of a majority of the voting shares of the said corporation. 



"The said Alfred L. Wanamaker was, for some time, president of the 

 said International Lumber and Development Company, and is now and has 

 been, since his resignation as president, the general counsel for the 

 .said corporation, and interested in and connected with Its management 

 and development and the sale of its stock. 



Organized to Defraud Public 



"That the International Lumber and Development Company was and 

 is a corporation organized for the purpose of defrauding tbe public by 

 obtaining subscriptions to its capital stock by means of fal.se repre- 

 sentation, and that the said corporation is insolvent, and is, at the 

 present time, totally mismanaged and that any further transaction of its 

 business will result in disaster and loss to the stockholders and creditors 

 "f the said corporation. 



"That the officers and directors of the defendant corporation have 

 appropriated to themselves large sums of money, aggregating $500,000 

 and upward, in the payment of alleged salaries to the officers and for 

 commissions on sales of the corporation capital stock, while adver- 

 tising to the public and to their stockholders that no salaries were paid 

 to any officers of the company. 



"That John R. Markley and Isaiah B. Miller, by means of their con- 

 trol of a majority of the voting shares of the defendant corporation, 

 made with themselves a contract by which they were to be paid $5,000,- 

 000. whicli sum was to be used in the development of the lands of the 

 defendant corporation in Mexico, and under which contract they further 

 agreed to pay. for seven years, eight per cent annually in dividends upon 

 the amount paid in upon the capital stock of the defendant corporation, 

 and have failed to use a large proportion of the said moneys in the 

 development of the property, as agreed." 



History of Operations 



In telling the origin and history of the International Lumber and 

 Development Company's operations, the bill continues: 



"In the year lOiio John R. Markley, one of the defendants herein, 

 and his then partner, Walter II. Bell, sold to a corporation known as 

 the San Pablo Company, organized under the laws of the state of New 

 Jersey, 288,000 acre's of land, situated in the department of Champoton, 

 state of Campeche. Mexico, for the sum of about $180,000. or in Mexi- 

 can dollars, the sum of about $350,000. That John R. Markley, on 

 July "0. 1004, as president of the San Pablo Company, addressed a 

 letter to the stockholders of the company, setting forth that land could 

 not be worked profitably and that he would endeavor to get a pur- 

 chaser for the same, so that he could relieve the corporation of the 

 burden, and urged them to sell it. and asked them for authority to 

 dispose of the said property for the sum of $450,000. p.ayable in two 

 equal Installments, the first Installment to be due in three years after 

 the date of the contract and the second installment to be due in five 



