QUARTERLY DIVIDENDS CASE.

Hawera Star, Volume XLIX, 15 November 1929, Page 4

QUARTERLY DIVIDENDS CASE.

DOAIINION REPRESENTATIVE CHARGED.

ALLEGATIONS BY CROWN

(By Telegraph—Press Association.; INVERCARGILL. Nov. 14

The hearing of the six charges of obtaining money -by false pretences against David NeiLson Johnston,, New Zealand representative of Quarterly Dividends, Ltd., and National! House Purchase, Ltd., was continued before Air Justice Kennedy in the Supreme Court to-day. The Grown Prosecutor 'pointed out that bbe two companies were in reality one con«Brn operating as two companies under the control of one man. The companies were sma'il concerns with a few shareholders who were in control.

He stressed the -fact that depositors did not become but merely deposited their money for investment and Laid no- say in the control or management. Aloney -having been deposited, a series of “paper loans” was granted to depositors until the £SOOO class was reached, when, it was stated, depositors would be entitled to draw -dividends on that amount for the rest of their -lives. Dividends were also stated at 20 per cent-. The allegation against Johnston was that lie had! informed prospective depositors that by the 'payment of £2 Is and 15 monthly payments of £1 depositors would reach the £SOOO class in 7J- years. The Grown would call the best actuarial evidence to show that the waitin-or period for the second loan of £SO would, be ten times' the waiting period for the first loan, which _ the experience of New Zealand depositors indicated would be. four years. Tlie waiting period for the second -loan would, therefore, lie 40 years -and so on down, the -list, the waiting period! auto-mat-icakv increasing down tlie list-. 'The Crown Prosectuor reviewed the evidence at- some length, and said the Grown would! call evidence to show that Johnston knew the scheme was unsound. had in fact been informed that it was unsound!, yet in spite of this he had carried on the trading on the faith that ignorant people were apt to place' in a man who on occasions preached the Gospel. Johnston was not an ignorant man. Gin the contrary lie was> a. man with a university education and was no fool. Tt would not he necessary for the jury to try to unravel the scheme sincetbe evidence for tlie Crown would be g* by the Government actuary, who would! ornnnunoo. the whole scheme unsound. Evidence along the lines or that given in the lower court was heard, Mter which the court adjourned tilt tomorrow.