"IMPLICIT BELIEF"

Evening Post, Volume CVIII, Issue 120, 16 November 1929, Page 18

"IMPLICIT BELIEF"

HNANGIAL'SCHEME

FAIsE: PRETENCES CHARGE

f | VM DISAGREE (By■ ijelegraph.-^Presa Association.; i^iINyEECAKGILL, 15th Nov. Charges of Ifalse pretences against David; JKTeilson Johnston were resumed in tlleiSu.prenie Court to-day. . . . ' The'titii^ed,- ■who pleaded not guilty, and wh67;-s?u:a represented by Mr. G. J. L. Whitei'-'ofL'Dunedin, is representative in NewXZealand' for Quarterly Divi-dends,-Ltd^.;-and ]Sf a tional House Purchase, Ltd.,- aild-it was in. connection with, money accented on behalf of these organisations that the charges were laid. : • • The accused gayp evidence that he was a married man with two children living at Dunedin. Ho had served in both the Boer and Great -Wars, and as a result of ill-health had had trf give up his work as a trained masseur and take up the occupation ,of selling ■Bibles. Ho said that the scheme had been brought to his notice by a member, but he had waited until the visit of the promoter, William Tavorner, to New Zealand. Ho had attended a meeting addressed by Taverner, over ■which a preyious witness (Moir) had presided. Moir, as' chairman, had said that the scheme had great possibilites, and after hearing Taverner's address witness had joined the organisation. He had become secretary for New Zealand after twenty other men had been suggested for the post, but had refused it. He himself had had implicit faith in the scheme until the hearing in the lower Court, when he had heard the evidence of tho Government actuary. He still believed in the scheme, but •would like to hear the evidence of an actuary of equal calibre as the Government actuary, as he had been assured that the scheme had been submitted to actuaries of the highest standing. In fact, he had been assured that the company would send out an actuary to testify. OBJECTION UPHELD. The Crown Prosecutor (Mr. Macalister) objected to that evidence as being subsequent to the charges laid against accused, and the objection was upheld. Proceeding, witness said that his wife and his two daughters were subscribers to the scheme, one of his daughters paying her contribution out of her salary. Thoy were still paying and still believed in the scheme. When addressing meetings he had said that 2i years was a fair average computation" for waiting periods for loans. The scheme had been in operation since September of 1920, and until 1925 a reward was offered to anyone who could show that the scheme was fraudulent- The companies had been, registered in New Zealand in 1928. _He himself received no salary for Ms services, but was mi the same footing as any .other member of the organisation, who received £1 for every four members, enrolled. ' Cross-examined, by the Crown Prose-; cutor, the accused .said lie had told people whom he had: canvassed that they would reach the £5000 class in about 1\ .years, but he certainly had Mot told them that thoy would draw dividends on the £.5000. The highest man.in New Zealand was .in the £-3000 class1, but he was drawing dividends on £400. He did not know that Taverner was the controlling force of the organisation.- JIo repeated that lie simply and implicitly believed in the scheme. Although this was so, he would not continue to enrol members until he had roeeivea actuarial support of his belief. Ho had read a loading article in the "Evening..Star" ..of l>uiicdin. in which ■was quoted an extract from the London "Truth", severely criticising Taverner. Still he" 'had" 'believed in the scheme. He had also read in New Zealand "Truth" strictures passed on Taverner bjr English Judges, but had still retained his belief. He had been with Taverner in Wellington when he had pciui questioned by a' detective in the police station there, and on: the eonclu-: sio.n of the interview the detective; had shaken hands with Taveriier and had •wished him well. Under these circumstances he felt that he could be excused: lor ignoring the newspaper articles. It ■was a fact that he had received a loan ot £300 from Taverner'-s companies to' pay for a shipment of Bibles which had gpno astray, and for' which witness had accepted responsibility.-.': Witness had; carolled 1000 members in the wganisalums; he had received a'commission a member. Apart from his communications with Taverner, witness had: not taken any steps in New Zealand to make inquiries concerning' the: soundness of the scheme. After' the proceedings in the lower Court he had showiv the Government's actuary's report ■to an : accountant in Dunedin, who had stated that lie could iiot- set ■ himself up; as an authority against a man possessing such high qualifications- as the Government actuary.; Sinco the prose-' ciition had been commenced he had accepted money posted to him, but had not solicited any deposits. 'At a meetmglie had held at Waimate it had been condemned by the: Mayor, and the president of the Retailers' Association. He considered that lie knew as much about tho financial' aspects of tho scheme as did these men, whom he did: Bot consider as experts. :■ ■ ■■■.'! ptBST CRIMINAL^ PROCEEDINGS. JAfter further evidence had'been called- for the. defence, Mr. White, in, addressing the Court, said he would em-' pbasise to them the fact that this scheme had been in operation .since 1920, under the very noses.of the flu-: aieial experts of the worJd, .and ,yet' this was the first criminal proceeding in, .connection with it. [Proceeding, Mr. White said that the question before the jury was not as to tHe soundness or otherwise of the companies, but whether defendant was a criminal. One would have thought the Crown wouia have stamped out the companies if false to prevent their continuing to delude the public, but he would g«:further: Not only had the Crown not thought lit to act in this way, but it 'had actually encouraged ' the continuation of the scheme by allowing the companies to register in New Zealand. Then, again, tho Police Department, although it had had the xwomoter of the scheme (Taverner) in New Zealand, and, in fact, had interviewed him, it allowed him to return to England without prosecution. As to the soundness of the company, it had been shown that the company was prepared to send out one of the world's financial experts to assist counsel for the defence. This wu- denied accused, said Mr. White, on account of the manner in which the case had been precipitated by the Crown. Counsel referred to the fact that accused was a depositor, and that his wife and daughter were depositors also and that they were all paying into the scheme. ; In addressing the jury, Mr. Macalister said that Mr. White had stated that in order to establish an offence tho statement made must relate to tho past or present, not to the future. That was so but with certain qualifications. A promise might be made which of itself implied that the man making it had power to- carry it out. Accused had made a very complicated explanation of the workings of the companies. His promike was such that it was clearly a representation which involved the power of>"the company to carry out what he said it could do. Mr. Macalister emphasised that the root and branch of the defence rested upon the assertion that accused was not aware his representations were/false.: ...:_.'■-'■.•. .I.'"'"..':--..' His.Honour's summing up occupied an.

hour and a half. He exhorted tho jury to banish from their minds anything they might have heard prior to the he:i°iug. The accused was entitled to a verdict upon the evidence heard in that Court, and they should arrive ;i(; that verdict upon such evidence. Before a verdict upon such evidence. Before a verdict of "guilty" could bo brought it was requisite that the following three essential ingredients of crime must be proved beyond all reasonable doubt: .Firstly, that there was an intention to defraud; secondly, that .there was in fact false pretence, and, thirdly, that money was obtained "by means of such false pretence. That was the law; the jury were tho judges of fact. The jury retired at 4.55 and returned at 9.10, when the foreman announced that they were unable to agree on any of the six counts. A new trial was ordered for Monday.