1903-11-12-New York Times-How Dresser Raised Cash

New York Times

12 November 1903, page 2

HOW DRESSER RAISED CASH

Sold $1,000,000 of Shipyard Stock for $200,000 to Aid Firm. C.A. Reiss Testifies that He Was Underwriter to Extent of $126,000 on Trust Company Funds.

Daniel Leroy Dresser's testimony was continued again yesterday at the hearing of the Dresser Co. creditors, in which J. Aspinwall Hodge, as counsel for the trustee, E.V. Whitney, is trying to ascertain what are the assets of the failed firm. Mr. Hodge largely confined his questioning to the disposition of the shipbuilding stock in the possession of the Dresser firm at various times.

Charles A. Reiss, Mr. Dresser's associate in business, was put on the stand to be examined as to some Shipbuilding stock and bonds that at one time stood in his name as an underwriter.

"How did you get into possession of 141 bonds and 375 shares of the common and preferred stock, each?" Mr. Hodge inquired.

"I was put down as an underwriter of the Shipbuilding Company when I was down in Maine on a fishing trip," the witness replied, "and Mr. Dresser explained when I returned that they had needed one more underwriter, and so took me. The Trust Company of the Republic was to carry the loan for me, and I never saw either the stock or bonds. Subsequently I understood that the loan was closed out."

"Then you borrowed $126,000 from the Trust Company of the Republic?" was the question.

"Yes, I believe so. I was an underwriter for 141 bonds at 94 and I received 375 shares of common and 375 shares of preferred stock. I heard that it was closed out for $27,000."

The earlier part of the hearing had gone at length into the modes of raising money for the Dreser firm. After Mr. Dresser had said that in addition to the $1,000,000 Shipbuilding stock which he had sold for $100,000, he had received $200,000 more as an accommodation from John W. Young, to be used as collateral or by sale for the benefit of Dresser & Co., Mr. Hodge asked about 700 shares that had been sent to an official of the American Tubing and Webbing Company, Caldwell by name, for selling purposes.

"Do you still claim these as an asset?" he demanded.

"I don't know," replied Mr. Dresser, while the attorneys smiled. "That is a matter to be determined in the courts."

"I find only 200 shares of the Shipbuilding stock on your books," said Mr. Hodge. "What became of the other 5,300 shares?"

"They were sold for the benefit of the firm and myself."

"Would the transaction appear on the books?"

"I think not, except as the money was turned over to the firm and myself."

Mr. Hodge took up a se3ries of loans obtained by Mr. Dresser from several lending agents and sought to trace them out on the books of the company. There was considerable argument between counsel, and at one point Mr. Maas, who represented Mr. Dresser's counsel, Morris J. Hirsch, insisted that it should be distinctly understood that Mr. Hirsch was not a Mr. Hirsh, a money lender from whom Mr. Dresser had obtained certain loans. The hearing was adjourned until Nov. 19 at 10:30 o'clock.