BUSINESS CRASH.

Sun (Christchurch), Volume I, Issue 155, 6 August 1914, Page 10

BUSINESS CRASH.

VAST SUMS INVOLVED, The financial world here was -surprised to-day by the-failure of Messrs H. B. Claflin and Company, a great drygoods firm (wrote the New York correspondent of the "Daily Mail" on June 24).. • Eeceivers for this concern wore applied for by Mr John G. Eames, its vicepresident, before the Federal Court, Judge Hand, here early this morningt—a friendly proceeding for the benefit 'of its creditors. The judge appointed Sir Joseph B. Martindale and Mr Frederic A. Juilliard receivers under bonds of £IOO,OOO each. Mr John B: Claflin, Bhead of the company, had been looked upon., for:many years as one of the "biggest dry-goods men" in the country, and was regarded rather generally as one of the "leading captains" in that line of industry. The company was one of'the oldest and largest of its kind in the eouritVy, and was incorporated many vears ago, with a capital of £1,800,000. It formed the nucleus of the United Dry Goods Companies when that so-called Trust concern was incorporated under the laws of Delaware in May, 1909, with a total capital of £10,200,000. ' Exactly what are the total liabilities of the Claflin Company failure will not be learned for some time owing to the extensive ramifications of the company, numerous other companies being involved here and in the south and west. Some people claim that the total liabilities, through commercial paper endorsed for the firm's account and distributed among New England and local and various State banks, may amount to £5,000,000 alone. The inability of some of; the interior houses connected, with the 1 company also the inability 6f ; the company -itself, to pay off the / matured part of these notes owing tor 1 the generally depressed state, of biasi-j* ness i and the greatly decreased precipitated the trouble. ! - A very important influence, however,, was the heavy losses sustained by the imposition of the greatly reduced. new tariff duties. It is reported that the company practically lost over £200,009 overnight on the reduced values of its stock of goods when those duties eame into force. LIABILITIES, £6,800,000. The Claflin Company had been doing business for over fifty years. No man stood higher in the dry goods trade and in financial circles than Mr John Claflin, and as he is well on in years he is heartbroken over the present difficulties. The concern directly controlled twenty-seven retail stores, and it is expected that most of these, scattered throughout the country, may be, .tern- - porarily at least, forced.into the hands of receivers pending reorganisation! Meanwhile it is declared '' that theic total combined liabilities are £s,Boo/}GQ f , with nominal assets approximately-,, listed at £8,800,000. The lawyers fend bankers declare that neither tber United Dry Goods Companies nor the Associated Merchants' Company, the holding and operating companies of the trust in which the Claflin Company was one of the principal subsidiaries, ,is seriously involved. A powerful banking committee, representing the largest banks in the city, are now examiningthe books of all the large dry goods stores and department houses here that may be in any way affected with a view to rendering assistance to any that need it. It is officially stated that Lord and Taylor, the*.largest New York department store, is iii. no way involved.