KREUGER CRASH

Manawatu Standard, Volume LII, Issue 120, 21 April 1932, Page 7

KREUGER CRASH

MORE REVELATIONS. ARREST OF AVELL-KNOAVN ACCOUNTANT. EMPLOYEES AVHO SAAV MISTAKES (United Press Association—By Electrio Telegraph.—Copyright.) Received April 21, 10.55 a.m. STOCKHOLM, April 20. A fourth detention in connection with the Kreuger crash is Anton AVendler, head of a well-known accountancy firm and one of the thx-ee Kreuger and Toll Company auditors. It is stated that AVendler, without the board’s knowledge, acted as director of one of Kreuger’s foreign secret companies. Tho latest revelations include a statement that employees occasionally drew attention to book-keeping mistakes in various Kreuger conct ms. Kreuger thanked them, but it was noticed that these employees were transferred to another department, and sometimes dismissed. PETITION IN BANKRUPTCY. NEW YORK, April 19. The International Match Corporation, one of the Kreuger and Toll enterprises, has filed a voluntary, petition in bankruptcy in the Federal District Court, admitting that it owes debts it is unable to pay. The corporation’s assets and liabilities are not listed in New York. KREUGER’S CAREER. ' Ivor Kreuger was born in 1880, in a small Swedish countrytown, his father being the manager of a match factory—a family concern. In 19CO, having passed his final examinations at the Royal Technical University in Stockholm, he went abroad, without any capital whatever, to try his fortune. In New Yoti-k he was employed by a real estate firm; in Illinois no worked for a railway contractor; in Mexico he engaged in bridge-building. Then he moved to Johannesburg, where he took over the construction of an hotel at a crisis, secured the necessary backing, and made a profit of several thousand pounds. This was Kreuger’s first outstanding success and he spent the fruits of it on travelling in many conutries and acquiring invaluable first-hand knowledge of markets and languages. AVhile still in the early twenties he was able to speak and write three or four foreign tongues. “The money was useful to gain experience, while I had the time,” he told a friend in later life. “I never doubted the possibility of getting more money, But time and opportunity come only once.”

Then, as' afterwards, Kreuger was helped by this remarkable memory. Often he proved his capacity to recall tho exact terms of a letter hastily read several years previously, and he possessed an extraordinary power of remembering the text of long past conversations. In 1907, at the ago 0f.27, he returned to Sweden, well primed with the essentials of material success, and in that year he combined with his friend, Paul Toll, to start a contracting firm at Stockholm. In 1913 Kreuger and Toll, assisted by Kreuger’s family interest in match production, acquired its first holding in a match-manufactur-ing company. Four years later came the great amalgamation of Swedish match manufacturers—the Swedish Match Company. As more than 90 per cent, of the production of Swedish matches was for exportation Kreuger immediately found himself faced with the intricate problems of selling on the world markets.

AVith the aid of a staff of highly qualified colleagues the Swedish match industry was soon transformed into a world industry, with subsidiary companies and allied enterprises in all the most important countries, and tho foundations were laid for all the subsequent dominating enterprises in world-finance.

England came into Kreuger’s scheme of operations through liis association with the British Match Corporation. In addition, through the Swedish Match Company and the International Match Corporation of America, he was able to claim in 1928 that his group controlled the match trade in America, Germany, France, Sweden, Norway, Poland, Peru, Greece, Australia, New Zealand, South Africa, Japan and other countries, and employed 60,000 workpeople. During the past 14 years foreign borrowers turned to the Kreuger group for financial assistance, and, provided the borrowers were prepared to give in return “match monopolies,” large loans were arranged. Loans of this nature were granted among others to Poland, Greece, Estonia, Hungary, Latvia, Yugo-Slavia, Roumania, Peru and Germany. The combine controlled match factories in 45 different countries in Europe, North and South America and the Far East. The consolidated bal-ance-sheet of the Swedish Match Company and its subsidiaries for 1930 showed assets valued at £45,000,000, while tho Kreuger and Toll assets were valued at a considerably higher figure. The issued share capital of the Kreuger and Toll Company amounts to about £4,250,000. There aro also issued about £7,500,000 of participating debentures and about £10,000,000 of 5 per cent, sinking fund debentures.