COMMISSION IN N.S.W.

Evening Post, Volume CXVIII, Issue 35, 10 August 1934, Page 10

COMMISSION IN N.S.W.

INQUIRY OPENS

COMPLAINT OF POLICE ACTION

United press, Association—By Electric Tele- ' .' ' graph—Copyright. ./,."•' SYDNEY, August 9. • When the Royal Commission into the operations of. 17 companies opened its sittings today, Mr. R. Windoyer, K.C., appearing for the Investment Executive, Trust of New Zealand, Limited, and- tho Southern British National Trust, Limited, protested against the action of the police in taking formal possession of tho office of the company he represented, thereby obstructing business and creating an embarrassing situation' for which there was no legal warrant. • Dr. IV Louat, appearing for tho

British National Trust, Limited, the British National Investment Trust, Limited, and tho Sterling Investments Company of New Zealand, described the police action as high-handed and one preventing tho directors having access to their own books and records in order to prepare their defence Tho Commissioner (Mr. Justice Halse Rogers) replied that ho had not authorised police intervention. Tho Judge said tha* the companies affected had a remedy at law. He announced the appointment of two accountants from the Auditor-General's Department to take possession of books and papers and allow officers of the companies access to them. DIRECTOR'S EVIDENCE. William C. Hewitt, a Now Zealand solicitor now residing in Sydney, was tho first witness. He said that he was a director of tho British National Trust, Limited, registered at Canberra. He was also agent here for'the British National Investment Trust, Ltd. These companies carried on business in the former "Daily Telegraph" building in Sydney. His daughter was assisting him. Hewitt said that ho was the sole director of tho British National Trust, the capital of which was £1,000,000. Farms .and Farinlets, Ltd., which was registered in New Zealand, held shares. He believed the original shares were taken up by J. W. S. McArthur, C. T. Alcorn, and T. E.. McArthur. Cheques were passed for payment of shares. No books were kept for the British National Trust beyond a minute book. This was entirely due to his own remissness, but the records necessary to complete the books were in his room. Hewitt said that he was also attorney in Sydney for the Southern British National Trust. This company had been housed in the Trust Building, Sydney, for more than, two months, but had not yet paid any rent, the lease being uncompleted. While acting as attorney ho had received many thousands of pounds from applicants for debentures and had also received some' shares and other securities. Harold Charles Glasson, secretary of the Investment Executive Trust of New 'Zealand. Ltd., tho Southern British National. Trust Ltd., ami Wynwood Investments Ltd., said that the share capital of tho first-named company, which was registered at. Auckland amounted to ; £100,000, most of which was e'alled up. Cheques were passed for shares and the cheques wont back to persons paying into the company. Mr. W. Monahan, K.C.,. who is assisting the Royal Commissioner, ■ asked the 'witness: how many shares were issued and paid for- otherwise than by cash. Witness said the number would run into thousands. He added that the capital invested in this company had been reinvested in abous 200 different companies. ' Replying to further questions by.Mr. Moriahan, Glasson said that tho Southern BritisTi National Trust was registered at Sydney and carried on tho same business'as the Investment Executive Trust of New Zealand, with the same directorate and 'the same secretary. Not many shares in this company wcro paid for in' actual cash. There was. merely [an exchange of cheques. '■ '. .EXCHANGE OF. CHEQUES. His Honour: What was the basis of this exchange of cheques? Witness: These peoplo were selling their services to the company—it was for services rendered. His Honour: Is there any record of these services? Witness: Only in the formation of th« 'company and the gathering of statistics. . . Mr. Monahan: Statistics of what? : Witness: Of various companies throughout the world. Mr; Monahan: Who got these shares? Witness: J. W: S. McArthur, Alcorn, and'several others. Mr. Monahan: What did you get for your services? Witness: Five, hundred five-shilling [ shares; Among the others the witness had mentioned was R. Glover-Clark (Auckland): Charles Graham Alcorn was examined regarding the affairs of the Sterling [Investments Company (N.Z.) Ltd., and I Alcorn, Trower and Company, Ltd. ! John William ' Shaw McArthur, ! managing director of the Investment Executive Trust of; New Zealand, Ltd., also the Southern British National Trust, Ltd., said that part of the deben turo money of tho Investment Executive Trust wus invested in debentures of:the British National Trust.

His Honour: Why invest debenture money, from company A in company B? Witness: To make money out of it for the original ■ debenture- holders. The.> get tlie income from the investment.

His Honour: When did those series of companies start operations?, ■ ■ Witness: About three years ago. The hearing was adjourned.