The Press. WEDNESDAY, OCTOBER 2, 1901 SOME FEATURE OF THE DREDGING BOOM.

Press, Volume LVIII, Issue 11085, 2 October 1901, Page 6

The Press. WEDNESDAY, OCTOBER 2, 1901 SOME FEATURE OF THE DREDGING BOOM.

While the naive confessions of Mr..Twomey, MJ-.C. as'to his experiences in "dredging ventures may cause a smile, the subject baa, of course, its serious side. - The uniscrupii.a_s methods which have brought the .whole dredging industry into disrepute' call -for searching investigation, and if fraud can be proved .against"any who enriched themselves at the expense of the innocent and unwary, the Government ought to see to it that the offenders are prosecuted. The present position of the industry has manydiscreditable features. It is stated that a very large number of companies whioh were floated during the boom, and are still in existence, -have actually done nothing

'whatever towards carrying out the objects ifor which they were formed. The Hon; A. Lee-Smith, when dealing with the Com--ipanies Bill in the.Legislative-Council the other day, threw light on the peculiar methods of company promoting, and management in connection with some of tbe Otago dredging claims. ' Speaking froan .personal knowledge, Mr. Lee-Smith asserted that "out of eight companies inquired into " as to their position, going before the nub"lie and .asking- for eubscriptions, seven "of. those companies have got no dredg"ing properties at all—-not a dbilling's "worth." -Comment on sUch a state of affairs seems superfluous, and Mr. LeeSmith's statement tbat "the promotion of *" thosa companies has. been carried out in ** an improper—be waa abnost going to say " fraudulent—manner," wffll jp-obabjly, in : the light of recent revelations, surprise nobody. Ono instance given by tbe-honour-able gentleman will suffice to show the peculiar manner in which, some alleged claims were floated. The promoter issued a prospectus, and soon had a large overapplication for shares in a company to work a claim on which; he had only paid 10s and some paid-up shares for an option. But as the owner of the property signed no transfer deed, ite can hold the ground as long as he pleases, and the company has in reality no assets. Meanwhile, a considerable amount of money has been called up on the shares, not to work tbe claim, but to pay the fees of the directors, one of whom is the vendor _f the property, and the salary of the secretary, who is name other than the option-holdor and promoter. Thus the unfortunate shareholders have paid hundreds of pounds into a comnany which has not acquired a shilling's worth of property, and their money has been frittered a.way in so-called "expenses of management" It is an unsavoury business altogether, and we are assured % 3lr. LeeSmith that it is only one of many similar transactions. It is to be htoped that the Parliamentary Committee now dealing with the matter will-be able, in the interests of the whole colony, to effect a full disclosure of the scandals connected with, the dredging boom. If tha evidence adduced is con-

aldered strong enough to .warrant prosecution, Parliament should not hesitate to have the offenders dealt with by the law, and punished according to their deserts. ; Meanwhile, the proposal to' amend/ tihe Companies Bill, with a view to rendering illegal some of the abuses which have occurred, is a step in the right direction. So long as there is a. gullible public, the bogus company-promoter will always exist; but it is possible, nevertheless, to make the law more of a safeguard than it is at present against the alluring schemes, of unscrupulous adventurers.