FANTASTIC FINANCE.

New Zealand Herald, Volume LXV, Issue 20074, 11 October 1928, Page 12

FANTASTIC FINANCE.

dividends out of capital. MISCHIEVOUS ENGLISH SCHEME. Efforts are being made to introduce into New Zealand a scheme by which depositors in a concern called Quarterly Dividends, Limited, are promised extraordinary returns for their money in the form of quarterly dividends which it is claimed arc never as low as Is for every pound, and have averaged Is lid a quarter. The principal agent in the promotion of this scheme is Mr. William Taverner, who claims to have founded it in England 25 years ago, the headquarters being in Bristol. lie is at present in New Zealand, and lias already been in Auckland.

According to pamphlets issued by the English office and its agent in Dunedin, operations aro conducted jointly through Quarterly Dividends, Limited, and National House Purchase. Limited. Tlio latter professes to make loans at per cent, interest on tlio security of dividends from the former, and the statement is made that tlio loan will be repaid, both principal and interest, by those dividends.

The character of this enterprise is evident from an examination of the accounts of Quarterly Dividends for 1927, published in the "official gazette" of tlio twin companies. Deposits amounted to £61,958; tlio only oilier income was interest- on reserve fund investments, £2683 32s 9d, and "gift from National House Purchase," £72 9s lOd. According to the rules, half the deposits, £30,979, were allotted to a reservo fund; office expenses absorbed £3953 lis 4d; and except for a balance of £4 9s 7d, the remaining portion of the other half of the deposits, £29,777 is Bd, was distributed in dividends. Tlio New Zealand pamphlet says there are fivo sources of income, and with probably unconscious frankness it places bona-fido new members first. The essential fcaturo of the scheme appears to bo to secure deposits from deluded people, and pay out half their monoy (less expenses) as "dividends." It is 'not clear how long tlio reserve fund remains, but it is curious that after 25 years' operations the total assets of the concern aro only £104,459, of which £30,979 accrued in tho last year. To maintain tho "dividends" it is obviously necessary that tho volumo of deposits should be constantly augmented by the enrolment of "bona-fido new members "

Anyone to whom this "magnificent and unique" scheme is presented would be well advised to reject it positively and finally. It is to bo hoped that steps will bo promptly taken by tho authorities to suppress tho activities of Mr. Taverncr and agents.