AMAZING DRAMA

Poverty Bay Herald, Volume LV, Issue 17174, 3 February 1930, Page 7

AMAZING DRAMA

FINANCIAL.CRASH FEARED ALLEGED DISHONEST BROKERS STATE COMES TO AID (Eke. Tel. Copyright—United Press Assn.) (Received February 3, 12 noon.) , VANCOUVER, Feb. 1. Canada this week watched the amazing financial drama in which the threatened wreck loomed so widespread that the highest law officers of the Dominion were obliged to come to the rescue of highly placed people they had just attacked. In'one afternoon five leading brokerage houses were raided, and 11 .principals arrested. Colonel William Price, AttorneyGeneral for Ontario,, *directed the battlo against the alleged* dishonest "bucketing" brokers,*, who - have scores of branches throughout the country. He closed them up, and asked the Stock Exchange to expel mining operators who last year alone handled mors, than £40,000,000 of public moneys. For one day the stock exchanges operated without these brokers. Overnight, however, the Ontario Government feared a financial crash that would rock the Dominion and early on Saturday it was announced that the accused brokers would be readmitted to the exchange. The At-torney-General was forced to capitulate to a definite threat that with the accused trader's prohibited from trading there would, be a panic,.and the unprotected stocks of . thousands ' of smalt holders-would be wiped out',' and in tlio case of criminal court charges against the brokers finally not being proven these speculators, large and small, would have good causo for legal redress against the Government o) Ontario.

Curiously enough, the Government of Manitoba also found itself in a desperate position and protested violently against Ontario's notion in seizing the offices and bank accounts of the accused brokers. Manitoba's prosperity is entirely dependent upon stabilised" wheat prices. Two leading brokers were carrying millions of bushels of- wheat on margin in the Winnipeg market. Their bank account soizuros occurred on the day when wheat reached the lowcßt point of the season. Noon on Friday saw the situation, where 10,000,000 bushels of wheat would have -been dumped on the market within an hour. The Premier of Manitoba then an-, nounccd that the resources of the entire Government would step into the market to stabilise the situation for he feared a panic that would have carried the price away under 3s on Saturday morning. The Ontario police released enough of the brokers' money to bolster up the wheat market and the crisis ' passed with Liverpool cables announcing two cents advance overnight. The week finished with the Government leaders having come to the realisation that some business is sometimes too big to be disciplined without far-reaching' and unexpected results. TRADING BY BROKERS CANADA-WIDE DRIVE (Received Feb. 3, 10 a.m.) VANCOUVER, Jan. 31. More firms feature in the nationwide drive against the alleged wholesale brokers' conspiracy to defraud the, public. At Victoria, Hugh Allan, thn oldest firm, and at Winnipeg, the St. Obie, Furlong, Matthews firm have been» assigned. The latter company has closed all its offices, leaving Saskatoon and other centres without trading. There is no trading in Ottawa, becauso all the brokers were suspended by the Stock Exchange. There was a sensation at Calgary, when the suspended millionaires, 1. W. Solloway and D. F. Patterson, appeared at the Stock Exchange, trading'in defiance of the exchange's order that trading should ' cease. Both were ejected and their previous trading was cancelled.

The drivo is likely to compel legislation banning all except cash trading in stocks.

At Ottawa the provincial investigator compelled one firm to buy Dack all tne stock it had sold in a dubious mine.