The San Francisco Call. Newspaper, August 21, 1898, Page 17

SAN FRANCISCO, SUNDAY, AUGUST 21, 1898. o @ @ LIST OF HCOLE LA R X 3 , which cest credito v > e @ few London, ittering uiation, has promoters of fI like of due to un- in chances. part of hi et career is now announces to the 1 prominent British al papers with large These two features ate company promoting. chase of “show” direc- ry and blackmail. )f expense Yand e and also ruined »aying two noble lords $125,- the use of their of a single com- ing $50,000 for a sin- al newspaper, and another, simply to prevent its 1 for s directors Think o attacking an hone enterprise! But these -are things which Hoc swears | he A4d. in the ordin course of busi- | yoley himse nobody. By all ac- at he was abie to accom- s due more to the people he 1 with, the peculiar condition of speculation in England during the ¥ than to any extraor- of his own. a genius. He made the Pacific a certainty when doubted. De Les: was an ps r of acknowledged reputation. lonel North, the nitrate king, was a imond in the rough. But ransack - life doings of Hooley from begin- 7ing -to end and his performances are pyrotechnical, smack of the.vaudeville, end ji financial distrust and financial dishonor. He' found the lust of money in Eng- land- stronger among cultured peers than .among the working poor. He heeded Walpole's dishonest sneer that stock of his to $24,000,000 at th the degener- | P PIPCPCROOROOOOCOOPQOEOY Y’'S OPERATIONS. his stock operations, s nies to hav~ depre- present time. His finan- « $100,000 20,000.000 10,000,000 5,000,000 2,500,000 2,000,000 5,000,000 2,000,000 10,000,000 1,000,000 500,600 y 200,600,000 .0 protection gold n The directors of the church have 9600069000600 00600060000606080949 9000 POOOPOOOOPOOOOSSOVDOY® every man has his price, and purchased the nobillty right and left. an hardly think other than that v and his noble and ignoble as- must be men of the same up, and regret neither the exposure 1 | enterprises m¢<aths he was a 30,000, In ue they first fell oft r cent after their flotation. To the 6,000,000. The | pr sent writing their value decrease has culators are | bt 60 per. t. Something valuable per cent ? found he wreckage, but not “the s s all done by a man who Hooley raked in a Nottingham lacemaker, teriing. with an income of How ear and tremendous ham has a population Former the workingmen labor to their homes. Then *at buildings, in which they d during working hours. rley at 21 owned one of these build- ievoted to lacework. That was n years ago. was not consnicuous in the com- mercial life of the town. He paid his debts, made a reasonabie profit on his lace, mingled little in the political or | social life of the place, but dreamed. | In ordinary conversation your Amer- ican will class the French or the Span- ish as the greatest gambling nations of | Europe. This is absolutely wrong. The greatest gambling nation of Europe, and for that matter of the wqrld, Is | Mother England. The disease in Eng- land largely takes the form of stock speculation. The greater the Iridescent | stock rainbow that can be projected In England the more certain the rich re- ward for the projector. Hooley himself knew this when in 1895 he made the first move which brought him to where he is to-day. To Julian Ralph he sald: “I have al- ways gone In for big things. If you go ha)fway up the ladder you will find it crowded with competitors. If you go to the top you practically have the field to yourself. There are plenty of men ready to deal In thousands, but they et frightened when you talk of mli- lions.” He went to the top, and from his dizzy eminence beckoned to the mad throng of peers, financlers, merchants, clerks, bookkeepers, half-crazy women | and working people beneath to follow him. They saw him perched in the sun- 1light of gold and tried to climb, throw- ing their wealth ahead of them at his feet. But the foundation was bad; the | fatal overbalance came, and then the tumble. Hocley's name was added to that of Jabez Balfour, Baron Grant, Colonel North and the late Davenport Dunn, gentleman. Fifty million dollars is the interest for one vear at 5 per cent on $1,000,000,- 000, In the three years of 1895, 1896 and 1887 Hooley, in one form or an- other and with a capital of less than $250,000 to begin with, made $50,000,000. That sober, staid England should not have appreciated that this sort of thing is a human impossibility, save that one is a born scoundrel, passes comprehen- sion. The memories of the South Sea bubble of Law, of Louisiana and the Mississippi vengures of Argentina and the nitrate beds were valueless. Hooley first tried his speculative hand at home. He had been working at his factory sixteen hours a day. He was s0 close a business man that he would not drink nor smoke during working hours, which, after all, is a big loss of decent pleasure. He always went to bed at 10 o’clock and rose early in the morning, “‘just to be in front of every- body else,” as he puts it. His income cas large enough to make his life a comfortable one for all his days. It would not do. He tried the Not- tingham stock market for a few months and clrared $100,000. Then he said au revoir to his laces and went to London, unknown, but surcharged with nerve. He came Into Capel court, the Wall street of England, one morning and engaged offices. He was ready then to paralyze every financier in the king- | dom, and he did it. The pneumatic tire craze is much try. of the countr. has been Pneumatic Tire Compa ing of the instit.tion was fair and its business good. Hooley called upon its officers and said that he was ared to purchase the entire com- what was the price? The answer was—=$10,000,000. HRooley The finan- stronger in England than in this coun- | One of the great tire companies | the Dunlop | all the world with any quantity of tubes. He called the concern the Swe- dish Tube Company and located its works at Coventry. He placed the capital stock at $3,000,000, and in a week's time had subscriptions for three times that amount. The company be- gan operations and paid fair profits for a time. Had Hooley stopped here, already worth $30,000,000, it is possible that his enterprises (Dunlop, Bovril and the Swedish works) would have gone on decently well and that he would have | kept for himself an honored name. But he either completely lost his head, as did Barney Barnato, or he could not control the yellow streak of cheap dis- play in his nature. He had English stock buyers by the throat, but seemed unable, now that he was on top, to keep the grip tight. Public curlosity could not satisfy it- self as to where he gained his power. In business he was associated with the | Earl of Delawarr, with Winchelsea, Lord Deerhurst, Warwick and other famops men of the nobility. They in- troduced him right and left and their simple recognition of him gave him a tremendous prestige with the common people of the land. With all the growth of radicalism in England your Johnny Bull still thinks the seat of all virtue is to be found in that decaying bulwark known as the House of Lords. Englishmen still revere nobility even if there {s nothing in it but shell. Hoo- ley’s adroit companionship with men of blood and name helped him tremen- dously. But how did he do it? He continued to float new business schemes, and the simple attachment of his name to thelr kites made investors asked for a week's option at that price and it was given to him. In the mean- { time he had secured the friendship of | Nottingham, vears of age. Derb; If ire, yS he He a Hon to suppert his stock compinies. certain newspapers and journalists and | also the acquaintance of various capi- talists. He called on them to aid him in the purchase of the company, guar- anteeing handsome profits in return. Two days after the option had been given him he had $10,000,000 subscribed and purchased the company; on the | third day he sold it to his associates | for $20,000,000, and pocketed $10,000,000 | as his profit. | In the transaction, it is stated, Hoo- | ley was not called upon to put his | hand in his pocket for a single shilling. London was staggered at the ease with which Hooley manipulated the Dunlop deal. Everybody wanted tire stock. The most sober-minded Eng- lishman saw all the world on bicycles equipped with Dunlop tires. Hooley said it must be so, and Hocley was the new Midas come to turn all things com- monplace into gold. The next move of the magician was to convince investing Englishmen that every man, woman and child in crea- tion was hungry for Bovril. The stuff is a beef extract which had been enor- mously advertised abroad for years, and for which there was a healthy de- mand. Hooley obtained a three-day option on the company at $2,500,000. The next morning he sold the company out- right to his friends and the gulls for $5,000,000. Aladdin never did more won- derful things than this. Dunlop and Bovril stock went gky high on the stock exchange. Clerks, small tradesmen, little fellows that never had a penny, but wise enough to follow Hooley, speculated In these stocks and became rich in a night. O!d financiers who shook their heads and would not follow him were ruined in a day. He was financial master of Cape! court and England. Reporters dogged his heels to note every doing. Dukes and lords hobnobbed with him. Apparently he played with them as if they were pup- ets. pBlcycle manufacturers in England just about this time (1886) were at a standstill in their work because of lack of tubes. The manufacturers of tubes could not keep up with the de- mand. Hooley announced that he was prepared to float the stock of a com- far and wide believe in their securit; He was traveling the path of Barney Barnato and the Kaffir shares, but no ERNEST TERAH HOOLEY, WHO MADE $50,000,000 AND IS NOW BANKRUPT. Speculator Hooley made $50,000,000 in London in less than three years. traction. He was worth when he came to London less than a quarter of a million dollars. slender, dark of complexio: in specch and mote quick In decision. He with which he clo His been only moderate; hi: fellow.” He ure B fond of the breeding o else that he knows of. He has no favorite author or musician. He smokes erts that he bribed English noblemen and London newspapers to the POOPPOPOOCPOOOOOOS® BRIBES THAT HOOLEY CLAIMS HE P@ID. To the Earl of Delawarr. Earl of Winchflsea. Earl of Aibemarle. Earl Earl Lord Deerhurst Lord Ashburton Further fees he alleges to havepald: Lord March for joining the Schweppes' board % To same a further sum per ot 5,000 year of -+ 5,000 Adolphus Drucker, M. P., ex- cess price of shares. 12,500 Sir Blundell Maple, for similar service .. cee 9,000 Lord Walter Lennox, for an introduction to Lord March 5,00 Lord Templeton, for services. 3,500 To one financial editor Pall Mall Gazette ... 15,000 To Harry Marks, Financilal News b To other newspapers for pro- tection 315,000 Grand total of “hush” money - alleged to have been paid..$717,500 How much more Hooley disbursed only he himself can tell. PPPPPPPPPVPOPPCVOOPVROIPPIOICGOOPD @90 ® P 9009009000 P0OPOPPO009PPPOPPVIPP0006P® 0D & Now he is bankrupt. became a lace manufacturer at 21 and a promoter of stock companies at 36. He is now 39 s married, London journals have failed to reveal it, or whether he is of English or other ex- { you have to sell it | his financial troubles had not come upon him at this time. Hooley has always said that he be- lieved he would yet be one of the Cab- inet Ministers of England. To help that belief along he sought the Parlia- mentary seat. First he gave up his offices in Capel Court, discharged his clerks, and took rooms at the Midland Hotel, which cost him $1500 per week. | There three secretaries were in attend- | ance on him from 8 in the morning till 10 at night. He transacted almost as much business in bed as out of it. He sent for the London reporters and | gave them this interview, announcing | his candidacy: | “You see, my position is a little bet- | ter than it was in my early days. and naturally I want to do everything I can for the poor of my old home. (Not- tingham is in Derbyshire.) I should like to represent my old friends in Par- | llament, and being a resident of Ilkes- ton, and not of Birmingham as Sir | Walter is, I have some advantage over |him. He has said that in a contest he could beat me by 2000 votes.” Hooley's financial crash cut short his political career before the election. The court's examination into the af- | fairs of Mr. Hooley commenced. His assets were shown to be §$1,848,815, and his Habilitles $7,745,355. He was 1nade | a witness in court, and his testimony has thrown a bombshell into London newspaper an. nobility circles such as was never hurled there before. Cleve- d House scandals pale before the testimony of this man, which if true makes him none the less ignoble; If false, brands him as the most gigantic fraud of the age. On July 27, on the stand in his own behalf, Hooley said: ‘“The chief reason | for my faflure is that my partner (Rueker) drew $2,500,000 out of my en- He was raised in He is of medium heirht, made Londoners stare at the ra manners are those of a ttle and sheep than of a ionally and drinks with moderation. tent of nearly three-quarters of a mil- terprises within two months.” The story in court of how the Dunlop Tire Company yas formed and floated is perhaps the most interesting. Hoo- ley bought the business on April 13, 1896, for $10,000,000, and sold it just one month later for $20,000,000. His gross profits by the transaction were ‘about $10,000,000. The public clamored for the shares and subsciibed the capital many millions over. The efforts of the Regis- trar in Bankruptcy to ascertain how he accomplished this wonderful coup brought out some interesting replies from Mr. Hooley. Q.—Were {.ou the promoter of the com- es. —As a company promoter, would you say what your duties were? A.—Well, I can hardly answer that. The Official Receiver—I hope vou will, Mr. Hooley. It i~ a point upon which I have often tried to obtain information. [Laughter.] The Debtor—Well, the first thin oy a business and then have to do is to buy again, and then, I think, the matter ends. The Official Receiver—You prepared the prospectus? A.—Yes. Q.—Are you, as the promoter, responsi- ble for the prospectus? A.—I hope not. [Laughter.] Q.—Are you responsible for the state- ments made in it? A.—No, I think not. My solicitor can answer that question better than I can. The Reglstrar—You cannot’' put the re- sponsibility on your solicitors. They only act on instructions. The Official Receiver—Perhaps I am asking too much. The Registrar—I do not think so. I POPOPPIVPOPO90000 S or;e appeared ready to institute a paral- lel. He announced that he would become a candidate for Parliament, seeking the seat of Ilkeston Division of Derby- shire. This seat i8 now occupied by Sir Walter Foster. The latter is a -radical, and the district is supposed to be safe for that party by 900 votes. Sir Walter and his friends laughed with scorn when they learned that the par- venu would fight them, but their rafl- lery changed to fear when they felt his mode of attack. Hooley would should like you to proceed. We might get some useful information. [Laughter.] The Debtor—I always think that the most important part of the prospectus is the front page. [More laughter. And then Mr. Hooley explained that the names on the front page of the Dunlop prospectus alone cost him be- tween $450,000 and $500,000. Probably there never before has been so strik- ing testimony to the value of big names as bait in winning money from British investors. Lord Delawarr, chairman of the board, received $125,000 cash for the use of his name, according to Mr. Hooley's testimony, and Lord Albemarle $125,000 more. Mr. Hooley then took up the interest- pany which would furnish England andJvaa been chosen for Foster's seat if | ing item of expense, best described as bribing the press. This expenditure in connection with bringing out the Dun- lop Company amounted to no less than $317,000! Not one penny of this was for legitimate advertising, ths Jatter e: Hooley's laconic description of the us- uval method of press bribery is very much to the point. This is it: Q.—In addition to .those shares you gave what are called in_the books “‘Press calls on shares?”’ A.—Yes. Q.—What are press calls on shares? AZT had a man called Broadley, who arranged all the advertisements and ev- penditure forming a separate item. Mr. | right | call?” | than par? | shares went at a premium? and whatever erything said in the pre: do not know calls he wanted he had. the names of the papers. Q.—What do you mean by a ‘‘press A.—It would be for somebody con~ nected with the press. .—Do you mean they were to have the to call upon shares at par? A.—Yes, and get an allotment. The “‘press calls” amounted in this case to £76,000. Q.—Would any call be delivered at less A.—1 do not know. You have the books there. These calls would be given for about a month, or until the special settlement. Q.—Did you purchase these calls back yvourself? A.—I don’t know. I bought in the market. I never bought them back from the parties direct. I was at that time purchasing all the shares I could in the market. Q.—What did you pay? A.—27s. 6d., 28s., and %0s. a share. On the ‘press calls’ alone I lost some £62,500. Q.—*‘Press calls,” I understand, were op- ticns, or calls, given to the press at 10s. in the pound, the result being that the company was fully sul:scnbe\d. g!vnd the A —Yes. Q.—Can you give the names of the pa- pers to whom these calls were given? A.-—Mr. Broadley arranged that. They were given to all the papers as far as [ know. But I can obtain the names of the papers. Q.—The result of that was that these papers made a profit of 17s. 6d. a share? A.—TI don’t say the papers, but the ad- vertising agent. Q.—Then the persons who had the calls were not the proprietors? A.—Oh, no. The Official Recelver—So each paper s would not run down the Dunlop Company? Mr. Hooley—It was to Keep the papers friendly. Q.—There were in addition to these large payments promotion expenses. What ent of £1250 to T. Harrison don’t know. 1 don’t know ughter). he when pa A.—He contracted to settle all the little evening papers and pay them to keep quiet. Q.—How did you become acquainted with him? A.—Finch Hatton introduced me. Q.—Who is Finch Hatton? A.—Brother of Lord Winchelsea. He was introduced to. arrange witn the evening papers not to )pull the company to pieces. (haugh- ter). Q.—On the counterfoil of the check you have written, “For quieting papers gen- erally on pneumatics.” (Laughter.) Can vou name any of the papers? A.—He used to bring a list with the amounts required against them. The amounts varied from £25 to £100. One of these lists will be among my papers. Q.—What was the second £2000 to T. H. Davis? A.—] purpose. Q.—On the counterfoll you have, “To square papers.” Can you name any of those papers? A.—The Pall Mall was one, the Financial Post :nother, I cannot recollect any others. Q.—What was the total amount you paid to Davis. A.—&£4250 to settle with all papers. The bribery of the financial editor of the Pall Mall Gazette on Mr. Hooley's behalf has been the source of great chagrin to Mr. Astor, the owner of that paper.. The Pall Mall Gazette won an enviable reputation two or three years ago as a fearless and incorruptible enemy of financial shams and swindles. The fact that its financial editor (now dead) had been got at by Mr. Hooley's agents only recently came to Mr. As- tor's knowledge, and he has not hesi- tated to express his views of the matter and his opinmion of Mr. Hooley and his associates’ in- very plain language in the columns of the Pall Mall Gazette. It was quite superfluous for the offi- cial receiver to ask Mr. Hooley finally why he paid these large sume to peers of the realm whom he made directors of his companies, for the reply was ob- vious: “I couldn’t get them on without.” Hooley has left aristocratic and financial London in a state bordering on a panic. Small investors in all parts of the kingdom are clamoring for their money in the stock concerns, while titled men whose sales of their names have been revealed are scurry- ing away to the Continent for seclu- sion and rest for their shattered nerves. LONDON, Aug. 18.—In the Queen's Bench Division of the High Court of Justice to-day Justice Wright resumed the hearing of the motion to commit Earl Delawarr, Messrs. Broadley, Brad- shaw and Rucker for contempt of court in attempting to induce Ernest Terah Hooley to falsify the evidence he had given against them. Hocley explained the discrepancy be- veen his own statement that he had syaid Earl Delawarr $250,000 and the #larl's statement that he had only re- —eived $125,000 by saying that he paid the latter $125,000 directly and subse- ‘uently gave him an equal amount “hrough Bradshaw, Hooley's agent, for givision between Earl Delawarr and !‘ord Albemarle. Hooley said he had ¥ince discovered that Bradshaw kept the $125,000. } Bradshaw went on the stand and as- ferted that Earl Delawarr, in the iourse of a conversation with him (Bradshaw) as to Hooley's position, of- /ored to pay Hooley’s hotel bill for a yhonth. and said he was prepared also 5 help Mrs. Hooley to the extent of £30,000. Earl Delawarr, Bradshaw de- lared, asked him not to let Mr. Hall lnow of the matter, which might be ¢snstrued as'an attempt at bribery. It was understood at the same interview that Hooley would be asked to correct lis original evidence. ~While on the stand Bradshaw fainted. Earl Delawarr acknowledged receiv- ing $40,000 as a gift. He said that he subsequently receivéd 37500 and at a latter date borrowed $50,000, but this money was not paid him for joining the directorate. Later, the Earl saild, he was released from this debt by Hooley. He admitted that he knew that Lord Albemarie received $45,000 and Broad- ley $40,000. u made this ayments of or the same 000000000000 00000000000026000000000008 on promotion_ $400,000. gross profit on promotion $564.310 on promotion $500,000. $4,500,000. tion $1,195,000. to tabulate to date. POPP0909009909900000600000020900000 0@ SOME OF THE COMPANIES HOOLEY FORMED. The Trent Cycie Company, Limited, nominal capital $500,000, gross profit Cycle Manufacturers’ Tube Company, Limited, nominal capital $1,250,000, The Dunlop Pneumatic Tire Company, Limited, nominal capital $25,000,- 000, gross profit on promotion $7,500.000. The Swift Cycle Company, Limited, nominal capital §1,775,000, gross profit The Singer Cycle Company, Limited, nominal capital $1,00,000. Dunlop Pneumatic Tire Company, (France), Limited, $3,250,000, gross profit on promotion $1,430,000. Clement Gladiateur and Humber (France), Schweppes, Limited, nominal capital $7,750,000, gross profit on promo- Bovril (British, Foreign and Colonial), Limited, nominal capita) $12,500,- 000, gross pro.t on promotion $2,340,000. Blaisdell Pencils, Limited, nominal capital §500,000. Dee Estates, Limited, no particulars. Trafford Park Estates, Limited, no particulars. A Ruleigh Cycle Company, Limited, nominal capital $1,000,004, Humber & Co., Limited (America), nominal capital $375,000. Humber & Co., Limtted (Russia), nominal capital $375,000. Humber & Co., Limited (Portugal), nominal capital $500,000. The above is only a partial list which the official receiver has been able Hooley kept no book accounts, not even a cash account. He has credit- ors fully secured to the amount of $3,000,000. 0000000009000 000002900000900000000 - nominal capital Limited, nominal capital $9006060000000006000000000000600090 0 soQ