MASTER SWINDLER.

Auckland Star, Volume LXIV, Issue 285, 2 December 1933, Page 7 (Supplement)

MASTER SWINDLER.

KREUGER'S CAREER

DECEIVING THE WORLD.

HOW SWEDEN LEARNT THE TRUTH.

(By JAMES MURRAY.)

Few persons are in so Rood a position to tell the story of liow tlie scandal of Ivar Kreuger's linancial crookedness broke upon the world than Captain .Tames Murray, at the time correspondent of "The Times" in Stockholm. Captain Murray is now visiting New Zealand, and he has put ou record in two articles i'or (lie "Auckland Star" his recollection of those fateful days. Xo. I. Already move than eighteen months have elapsed since the suicide of Mr. Kreuger literally shook the world of investors. I use the word "investors" because the majority of shareholders in the Ivreugcr concerns were not mere speculators. How could it be otherwise when firms of century-long standing, such as Iligginsons, were the issuing houses for shares in this gigantic undertaking? If the death of this man can be said to have astonished the people of five continents, think of its effect upon poor little Sweden whose idol and envy Mr. Kreuger had been for more than a decade, during which time he had ranked with the most eminent financiers of the age. It was staggering.

Before we go further please remember that a whole fortnight was to elapse before the swindler was to be exposed and that, at the time of his death, Kreuger was regarded as a martyr and even as a hero to his friends and 'business associates. Kreuger shot himself with a heavy calibre revolver, which ho bought the day previously at a shop close to his home in Paris. It was Easter Saturday, March 12, 1932. This self-same, Saturday was the day that France had chosen to bury M. Briand, an idol of another and greater people, but an idol of what another kind! This fact was destined to play an important part in matters regarding the Kreuger suicide, as I will show you later. The fact that Kreuger was in Paris at the time he found it necessary to end his career for ever was 'not liy any means a fortuitous one. Kreuger had been recalled from America by the Prime Minister of Sweden, to give an explanation, for the ever more frequently recurring demands made to the Government by the Kreuger board of directors for financial assistance. Mr. Ekman, Sweden's then Premier, sent a party of leading bankers down to Paris to meet Kreuger, who was arriving on the Atlantic steamer which would bring him to a French port. Kreuger, as. we know, arrived, but his nerve failed him at the last minute and he saw the game was up. He did not attend the fateful meeting which was timed for noon on that black Saturday.

Fateful News. It is unlikely that I will ever, forget the day of Ivreuger's death. Having known the dead man personally and worked with him congenially for the best part of four' years, I was admittedly one of his admirers and had fallen quite under liis strange spell. The British Consul in Stockholm, Mr. William Oxley, was the host at a dinner party that evening to the members of the Corps Consulaire in Stockholm, and I attended. We had hardly sat down at table when I was summoned to the telephone. When I came back my face must have been haggard, because the Chilian Consul-General at once demanded, "What is the matter?" I replied, "Kreuger is dead." Now so great was the faith in Kreuger that nobody would believe me, and I really doubted it myself. This was greatly due to the fact that over a week earlier the rumour had come to Stockholm that Kreuger had poisoned or shot himself in Boston, which rumour turned out to be false. The result -was that I was so undecided I laughed off the matter with the other guests and even refused a bet! "However," I said', "I will find out if I can whether the Stockholm Press knows anything." Accordingly I went back to the telephone and after impatiently trying to get connected with the leading dailies, which seemed to have the engaged signal attached to their ends, I got through to the "Dagens Nyheter." There was no need to speak to the editor's room for the telephone operator replied without my putting the question, "Mr. Kreuger is dead!" We had to believe her. It is not difficult to imagine the topic of conversation for the rest of that evening. The first thing to do was to telephone London. I got through quickly and found "The Times" had already received the news from Paris. I received my instructions tc telegraph as much of the reaction before the next evening as was possible. "The Times" does not appear on Sundays so I had a good' twenty-four hours ahead of me fortunately, incidentally I was advised by the foreign news editor "not to get excited."

Prime Minister's Position. The news of Kreuger's suicide spread like wildfire, and I venture to say there were innumerable people who failed to sleep that Saturday night. Mr. Ekman, the Prime Minister, sent for me and asked me to' get my paper to do its best to minimise the risk of any disaster to Sweden. In any case this -would have been done, but at that time I did not know that the late Prime Minister of Sweden, now living in retirement as a farmer, had received two sums of 50,000 kronor from Mr. Kreuger for his party funds, a circumstance which was most distressing for Mr. Ekman, as events showed. There was nothing to be done but make the best of a bad job, and since there was no reason for undue worry, as was popularly supposed, we gave Mr. Kreuger the finest leader ever possibly accorded a foreign financier, whilst his obituary notice on another page filled more than a column. Why not? Kreuger issues had been falling steadily for months past, with the exception of a slight rally in December/January just a few months earlier. This had fizzled out, and Kreuger had simply broken down under the strain, and, his nerve having gone, he shot himself. Other important men had done likewise, and did not Kreuger have the most able staff to carry on his work? Of course he did, and "business as usual" signboards would go up as soon as the funeral was over. Little did .we know what this staff was to amount to when the investigators had performed their grim task.

A Moratorium. In the meantime, Mr. Eknian, as the head of the Radical Government then in power, realised how vitally important it was to take whatever steps might suggest themselves to prevent anything in the nature of a panic. Clearly a moratorium was the only way, and Kreuger's own affairs as well as those of the Match Trust,, the Kreuger and Toll, Garanta, and of several of his closest associates must be put under administration as from the Saturday. To do this in a hurry was not so easy as the Constitution of Sweden does not permit a bill to be introduced and made law in the same day. Members of the "Riksdag," the Swedish Parliament, were brought to Stockholm post haste from their homes, and the preliminary stages of the requisite measure rushed through on the Sunday afternoon. Members were summoned to be in their places by midnight, and the moment the strokes of' twelve had finished resounding through the building the Premier again explained to the House that if Sweden was to be in a position to face the world should a crisis arise as the result of Kreuger's death, such an amnesty for the Kreuger affairs as the one proposed was the only way out of their difficulties. The Socialists showed some opposition, their party leader, now the present Prime Minister, and some others, referring to class distinction and to Mr. Kreuger as a "financial shark." But the bill was passed, and by ten past twelve oil Monday morning it could be entered in the Statute Book. It was with a feeling of uncertainty as to what might be in store as the result of their night's work that members dispersed the moment they could get away; heavy snow falling outside heightened the illusion caused by the eerieness of this unusual midnight session. Politicians are seldom asked to attend a sitting of Parliament under such circumstances as these. Since the previous day rumour had not been idle, and the wildest stories were in circulation ascribing the actual reason for the suicide to every possible one except the right one! The next step was, of course, the appointment of an administrator, and this was duly done 011 the 14tli. An advisory committee of six leading legal and business ijien was set up to act as investigators. The task was literally an enormous one in view of the wide ramifications of the concern.