BOWRON BROS., LTD.

Otago Daily Times, Issue 16348, 3 April 1915, Page 7

BOWRON BROS., LTD.

EXTENSIVE SCRIP FORGERIES. HERMANN TO BE PROSECUTED. ~R.Fi ADJUSTMENT SCHEME PROBABLE. JTfcW ZEALAND PROPOSALS ACCEPTED. Pies* Association —By Telegraph—Copyright. SYDNEY, April 1. At the annual meeting of Bowron Bros.' Export Trading Company (Ltd.) Mr Alexander Jobson, director (presiding), explained that he was now the only local director of the company. Hermann's place had not been filled and F. W. Bacon had resigned.

Mr Jobson -was re-elected director. He stated that he desired to obtain an expression of opinion on the question of instituting criminal proceedings against J. Erie Hermann respecting alleged fraudulent dealings with the company's shares. He outlined the steps taken to secure Hermann's resignation of the chairmansHip of the board! Hermann virtually admitted that there had been irregularities affecting only abont 20,000 shares. Hermann subsequently produced fraudulent scrip and transfers representing 35,000 shares, which were destroyed. He admitted that there were still about 20,000 shares outstanding. All scrip -was then called in, and as a result the total of bogus shares rose to l>ver 133,000, making, with 35,000 redeemed by Hermann, a total of over 168,000, which Hermann admitted issuing, but pleaded that he was not in a proper state of mind. They were, however, issued at various periods dating from May, 1912, to March, 1914. In one case the certificates "were simply torn put of the book, tho. butts were not filed, and the scrip ■were signed, not at a board meeting, but at any odd time. In some cases the scrip ■were not sealed with the seal of the com.pany. In others, one or more signatures' forged; but many appeared to be legal certificates. He had obtained distinguished counsel's opinion on this side. They held that perhaps half the fraudulent' scrip certificates, representing 60,000 shares, could be held good as against the company, and it was likely that many holders of the other half would fight. It looked as if a new company would emerge out of the old one. The business was undoubtedly good, and the trading figures •were big. It was a -very great pity if it had to be sacrificed. ' > After considerable discussion the meeting decided. that the directors be asked to prosecute Hermann if his appeal from the recent sentence proved successful. They •also favoured the .general suggestions of the New Zealand board as regards cleaning up the irregular shares, and promised support to any reasonable scheme of readjustment. (Received April 3, at 0.25 a.m.) Mr Tilley (representing 20,000 shares) said there was no doubt that a great deal of trouble occurred through want of care on the part of the directors. It might be advisable in the event of reconstruction to alter the name of the company altogether. If they were not prepared to subscribe more capital, liquidation would follow, and the New Zealand people, knowing the value of the business, would buy in. ,