Huge Swindle by Americans.

Taranaki Herald, Volume XLIX, Issue 11664, 25 January 1901, Page 3

Huge Swindle by Americans.

» At the London Sheriffs Court lately, before Mr Under-Sheriff Burchell and a jury, the case of the London and Westminster Contract Corporation (Limited) v. Brotherton came on for the assessment of damaged, having been remitted from the High Court. Mr A. H. Spokes, who appeared for the Official Receiver, said that the claim was for the sum of £57,500, the defendant in the action oeing aMr Joseph Hamilton Brotherton, an American. He was formerly a Methodist minister in America, until he came over to England to reap a rich harvest with his partner and co conspirator, a Mr J. C. Kemp ran Ec, from the people he had duped. Van Ec could hardly read or write, but he appeared to have been very clever at company promoting. He could not, however, now be found. Brotherton had been discovered in America, and the action was brought to see if any portion of the enormous sum he bad swindled the unfortunate shareholders out of could be recovered from him. The modus operandi of these two men was first to form a company called the Debenture and Share Trust Syndicate (Limited), under which name they carried on their business at Bishopsgate street, City. This company consisted of Brotherton and Van Ec and five clerks in their employment. The two jjrincipala^tben net to work to acquire 200,000 shares in the Miners' Dream Gold Mines (Limited ) ? Consuello GoH Mines (Limited), British Exploration Company (Limited), British Pioneers (Limited), Renmark Gold Mines (Limited), Filbarra United Gold Mines (Limited), Nigel Main Reef f Limited), and Mt. Renmark Gold Mines (Limited). The whole of the above were vendors' shares, and were acquired by Brotherton and Van Ec, or the syndicate, as promoters' shares, and without payment of any cash o. valuable consideration. In fact, the whole of the eight companies were promoted by the two swindlers, and the shares were practically worthless. The shares were registered as the property of the Debenture and Share Trust Syndicate (Limited). As the Stock Exchange would not look at such affairs, the market was '' rigged " by means of financial newspapers. The London and Westminister t3ontradt Corporation (Limited) was then formed, and four gentlemen of honour, though apparently not of business, including Sir James Lin ton, were induced to act as directors, Brotherton managed to get himself appointed as manager and secreiary of the company, and it was under the terms of his agree ment, which stipulated that he should " well and ' faithfully serve the aiid company, and use his utmost endeavour to promote the interest thereof," for the. term of one year, from June 8, 1896, that he was now sued The 200,000 worthless shares were then sold to the company by a clerk in the defendant's employ, named Lanigan, for the. sum of £55,000, the whole of which went into the pockets of these two Americans. A previous transaction in connection with the sale of 5000 Consuello gold mine shares was effected for the sum of 1 2500, which also went to Brotherton and Van Ee. Having made £37,500 the pair decamped to America with the spoil. That amount w.is now claimed, with interest at the rate of 4 per cint for four years. Mr Edson, from the Official Receiver's office, produced the various cheques which were paid in connection with the transactions, and which were cashed at different bjmks where the partners had accounts and ' aliases. The only shares which realised 1 anything were the Consuellos, which '" produced the sum of £223. The jury ■ found for the plaintiffs for £66,441. t J Judgment was entered accordingly, with i costs.