CREDULOUS INVESTORS.

Otago Witness, Issue 3804, 8 February 1927, Page 22

CREDULOUS INVESTORS.

A VERSATILE DEALER. CHARGE OF FRAUD PREFERRED. At the City Police Court on Friday George Thomson Swann was brought up on remand and charged, before Mr H. W. Bundle, S.M., with having, between March, 1924, and March, 1925, at Dunedin and Beaumont, with intent to defraud, received sums of money from four different persons, by representing that he was dealing in second-hand machinery and that he was supplying machinery to the New Zealand and South Seas Exhibition; and that by investing money with him the investors would participate in the profits from the sale of the machinery. The sums Swann was alleged to have received were as follow: —£180 from Margaret Gibson, £292 from Elma Alice Crawford, £1953 from John James, and £630 from Mary Ann Hall.

Chief Detective Cameron represented the police, and Mr A. C. Hanlon, with Mr G. T. Baylee, appeared for accused, who pleaded not guilty. Edmund Anscombe, an architect carrying on business in Dunedin, said be supplied all the machinery for the Amusement Park at the New Zealand and South Seas Exhibition, but none of it had been bought from accused.

Margaret Gibson, a married woman, residing at Macandrew Bay, said she had known accused for about 20 years. About the latter end of 1924, about which time accused was having dealings with her husband, witness sold a property at Macandrew Bay and deposited the money in the Post Office Bank. Accused asked her if she wished to invest the money, as he wished to buy machinery to supply to the Exhibition. Witness knew her husband had been receiving profits from Swann, and the latter had assured them that if they would come in on his deals they would all die rich. Accused told them he was obtaining the machinery through the National Bank, and in May, 1924, witness gave him a cheque for £2BO, and later on received a receipt for the amount. Accused had warned her to preserve strict secrecy regarding the transaction. On August 6, 1924, Swann paid witness £5O, and about a month later another £5O, intimating that these sums represented her share of the profits from his investments. This £lOO, however, was all she had ever received. Witness, in reply to a further question by Chief Detective Cameron, said that the big interest which Sw-ann was offering induced her to part with her money. The fact that he had mentioned large deals in machinery had also influenced her. “That was not all he dealt in, though,” said witness. “He used to deal in butter, eggs, strawberries, and ham and so forth.” Witness added that when she paid accused the £2BO she could not be certain that he had said anything about profits. Edward Alexander Gibson, a bootmaker residing at Macandrew Bay, said he had known the accused for a great number of years. He had dealings with him in 1924. The Exhibition buildings were then in course of erection. Accused met witness and asked him if he had any money to invest. He said he was going to supply machinery to the Exhibition and it would be a good thing. On a later occasion he said he was purchasing sawmill machinery in the South Otago district and he was paying men £lO per week to dismantle the machinery. He was selling the machinery on the West Coast. He told him it was a paying proposition. He told him this after he had returned the money which he had previously invested. He said the bank was sending him to Wellington to arrange some matters as they were so pleased with his success. He did not mention the name of the bank. He offered

witness a partnership in the business and said he would see him (witness), rich before he died. He left £5 for witness which he said was part of a deal he had made. After that he met witness on the street on yarious occasions and he handed him various sums. He received in all £lB3 from accused, who had received £3OO from witness. Accused said he had dealt in potatoes and eggs in addition to machinery for the Exhibition. About the beginning of June, 1924, witness paid accused £l3O. He said he had any number of deals going on. He then paid accused another £l7O in different sums, making £3OO in all. He said he was doing well and would shortly be going on a holiday and everything would be squared before he went. Witness had still £ll7 owing to him. He had received £lB3 in all from accused. He said these were profits from deals. On one occasion he met accused near John Chambers and Co.’s premises. He took him into the premises and pointed out a machine which he said he purposed buying. On one occasion he took witness and his wife home in a car. He told witness at that time that lie would shortly , be going on holiday and would be squaring up. Witness’s solicitors subsequently informed he and his wife that something was wrong and that Swann was ill. He, at various times, received from Swann, a bag of potatoes, several dozen of eggs, a ham and about a dozen pottles of strawberries. The approximate value of these would be about £3. Io Mr Baylee: No receipts were given for moneys received. Defendant classed witness as one cf hie partners. Mary Ann Hall, of Beaumont, said that from July until December, 1924, she and her husband were the licensees of the Beaumont Hotel, where they first made accused’s acquaintance. In December, accused heard they were selling out, and told them that he had a deal on near 'lnvercargill and asked them to invest £4OO with him. Accused said he also was going to invest £4OO in the deal, which required £BOO. The profits, which would be large, were to be divided equally. Witness did not have £4OO at the time, but paid accused £2OO by cheque. He requested witness to observe secrecy in regard to the transaction, and shortly afterwards he returned her £2OO with another £lOO be- ’ sides. Later, after witness and her hus- ‘ band had sold the hotel, accused visited them at the camp, where they were living, and told them he had another deal pend- • ing in machinery at Ashburton, the , profits of which would come to £5OO. He ’ told them he was a bank official, but this 1 was to” be kept secret also. The same ! day as accused told • them about the deal at Ashburton he took ' witness and her husband to Dunedin, where they completed hncmosa in n inn xvifL f-ba

of the hotel, after which accused drove them back to Beaumont. This was on December 14. On arrival, witness paid to him £6OO on account of the deal at Ashburton, receiving promissory notes for the amouht payable a month from date. At this time, witness’s husband was in bad health. Accused had promised that the £5OO profit from the Ashburton transaction would be divided equally between him and witness and her husband, but about the time the promissory notes became due accused rang them up and. told them he was unable to meet his obligations as his men had had too good a time at Christmas. On March 7, 1925, witness paid accused another £l5O in respect of a bankrupt sawmill at Tawanui, which he proposed purchasing. She had been assured by him that the profits from her investments would surprise her, but she had never received any portion of the last two amounts she had paid accused. Witness had been induced to part with the £6OO on Swann’s assurance that she would receive £250 profit, and that he was a bank officer.

To Mr Baylee: She went out of the hotel on December 2, 1924, but did not go to Dunedin to complete the sale until December 14. A month after this, witness’s husband was committed to Seacliff, and she wrote and told Swann about it. He immediately went to Otekura to see her at her’ mother’s home. James Robert Blues said he was treasurer and accountant of the New Zealand and South Seas Exhibition Company in Dunedin. He had made a careful search of the company’s account books and could find no trace of any dealings between the company and Swann. There was no record of any machinery having been bought from Swann. James Yoeman Love said he was managing director of the Love Construction Co., and he was manager Of the firm of Fletcher and Love, who had the contract for the erection of the Exhibition Company. He had searched his books and found that the firm had had one transaction, with the accused. It was the purchase of a swing saw for which he was paid £2B. That was the only dealing that had been made with Swann.

James Long said he was an accountant for the electrical department of the Dunedin City Corporation, and he had examined the accounts of the electrical, water, eas, and tramways departments, also the Drainage Board, as to moneys paid out from the year 1922 to the end of 1925. The Corporation had had two dealings with accused. One was the nurohnse of a milling machine on August 18. 1924, and a lathe motor on February 23, 1925: £25 was paid to Swann for the former and £l6O for the latter. These transactions were aoart from small transactions with G. and T. Swann. Elma Alice Crawford,, resident at St. Andrew street. Dunedin, gave evidence that she had known accused all her life. On the morning after th« death of witness’s father, accused had come to her and said he owed her father £5O in cash. He paid witness this amount and said he was going to make it his business to help her and her mother, and advised them if they ever •had any cash to spare, he would bo glad to invest it for them. He also mentioned the Masonic order. In May. 1924. witness handed accused £125. which a few days later he repaid, together with £26, which he said was profit. On May 29 witness handed accused another £2O. which was returned shortly afterwards with another £6 profit. In June, she sold a motor car and gave Swann the £2OO she received for it. Again, when Swann knew that witness had insurance and funeral benefits to draw, he asked her what she was going to do with the money. On witness’s replying that she was going to pay off her property, Swann advised her to let him have the money to invest for her, and she paid to him the full amount, which she had mari up to £2OO. This amount accused said he was going to use to buy wire rope for the Kawarau. Tn July, witness handed accused sums of £l4O and £120.' and in ' August he returned to her £l4O and another

£26, and later, the £l2O with £3O added. Witness then paid him another £l2'o. Swan when asked about the first £2OO, told her that he could not get a cheque from tho .ryxhibition Company until November, but afterwards extended the time until February, when he assured witness he would return to her £9OO. Swann did not materialise in February, and she pressed him for a return of her money, whereupon, he. paid her £lOO on account. Shortly after this Swann had lunch at witness’s house,and told , her he could not do anything for her. Witness did not see him after that. In all, she had paid Swann £925, and had received back £633.

To Mr Baylee: The majority of the amounts were paid by cheque, drawn on her mother’s account, but some were paid by cash. All the money was her mother’s. At this point Chief Detective Cameron made formal application to have the name of the complainant in this particular ebarge amended to that of Alice Jane Crawford, which was granted. James Renton said he was assistant accountant for the Otago Harbour Board. He had examined the books of the board from the beginning of 1922 to March, 1925. There w’as no record of any transactions between the board and Swann with the single exception of an order of a second-hand circular saw given on October 23. The price of the saw was £2 16s. The account for that was rendered by the firm of G. and J. Swann as part of their monthly account. Henry Sinton Hammond, manager of the Dunedin branch of the National Bank, said he knew the accused. His bank had done no business with the accused either in machinery or any other goods. Jessie Christina Elizabeth Crawford said she resided with her sister and mother at 112 St. Andrew street. She knew that accused had done business with her father. He came to her after her father’s death, and he said he would be a friend to them. She told Swann that she had money belonging to another party. Some time later —in June, 1924 —he came to the house and said that he could do better with the money than allowing it to lie in the Savings Bank. Witness knew accused was dealing in machinery. On June 23, 1924, she gave him £lOO, and about July 2, 1924, she received £2O. which he said her investment had earned. She later gave him £2OO. She accompanied him to the Exhibition, and she understood that he was inspecting machinery there. She had heard him say he was buying wire rope for Kawarau. He had also said he was buying machinery for the Exhibition.

John James, a slater, residing at Canongate, said he had known Swann for a number of years. In March, 1924, witness wa« in Swann’s shop, and the latter told hin: he had £450, and that if witness would lend him some more he could make a lot of money dealing in machinery, and with no risk whatever. Swann had assured him that the National Bank was financing him in the deal. Witness then related how accused had borrowed various sums from him, and brought back what he said were the profits. “He kept bringing back a little and taking away more,” said witness. In all, Swann received from him £4005. and returned! £2052, and in all transactions insisted on strict secrecy. Alfred Melville James, son of the previous witness, corroborated his father’s evidence. Harry Louis Patrick Bateman, a confectioner residing at Oamaru, gave evidence that Swann bad, in 1924, borrowed £lO from him, but had returned it. Early in 1925 he had asked witness for £3OO with which to speculate in machinery which he was going to supply to the Harbour and Dunedin Drainage Boards. Witness could not give him £3OO. but alter making inquiries regarding Swann’s fianaucial position he lent him £l5O. Two hours afterwards Swann returned him £lO. and told him this was his share of the profits. A week later he received another £5, but this was all he bad ever received back from accused. Constable Cooper gave evidence of having arrested accused on January 10 at Adelaide on a warrant issued from Dunedin. On being arrested accused stated he did not wish to say anythin— regarding the charge. Witness subsequently escorted Swann back to Dunediir. Accused pleaded not guilty, and was committed for trial at the Supreme Court. Bail was allowed on accused’s own recognisance of £5OO and two sureties of £250 each, conditional on his reportin- daily to the police.