"Very plausible, but where are these guarantee companies?"
"Why, there are The National, The States, and The Industrial. We hear
The States is doing a booming business. Go and see them. They are at
such a number."
The victim went to the richly furnished suite of offices occupied by
the guarantee company and met its dignified "president," to whom he
explained the purpose of his visit.
"Very good," said that official. "We will accept your risk. We will
issue you an option agreeing within one year to issue you bonds
against your stock as sold, you to pay us an advance fee of $1,000."
The "sucker" demurred. He had only $500 spare cash. The president
suggested that as the broker would make a liberal commission out of
the deal he might put up the other $500. The manufacturer 'phoned the
broker, who promptly agreed to pay one-half of the fee. The broker
gave the victim a worthless check for $500, which he gave, together
with $500 of his own good money, into the hands of the "guarantee"
company. The company thereupon issued a certificate, or option, for
bonds that were never called for because the broker never sold any of
the stock.
The victim went home loaded down with promises. The broker "strung"
him along for a month or two, but sold no stock. Finally the
manufacturer realized he was buncoed. The broker and the "guarantee"
company divided the $500, and proceeded to find other suckers.
March 17, 1906, E. C. Talmage, who conducted the National Underwriting
& Bond Co., of San Francisco, Cal.; the Pacific Underwriting & Trust
Co., of San Francisco, Cal.; the Imperial Bond & Trust Co., of New
Jersey City, New Jersey; the International Trust Co., of Philadelphia;
the Chicago National Bonding Co., of Chicago, at 52 Dearborn street;
E. C. Talmage; E. S. Barnum, 103 Randolph street; and M. J. Carpenter,
of the First National bank, were arrested.
George D. Talmage, another member of the firm located at Kansas City,
Mo., was afterwards arrested and brought to Chicago, charged with
obtaining money under the confidence game. The warrants on which they
were arrested were taken out by E. J. Denison and Rev. Peter A. Baart,
a Methodist minister of Marshall, Mich., who were officers of the La
Vaca mines and mills, of Joplin, Mo.
Rev. Mr. Baart first went to E. C. Talmage.
Talmage sent him to E. S. Barnum to have the stock guaranteed. Barnum
charged him a fee of $500 and agreed to sell the bonds, which he
failed to do. They just simply divided this fee between them and made
no effort to float the bonds.
Among the persons alleged to have suffered losses are the following:
Victoria A. Toole, 396 55th street $500
Dr. C. J. Grey, 103 State street 250
Miss Frances Mason, sister of Hon. W. E. Mason 1,000
A. C. Nelson, 1057 Addison avenue 150
J. W. Wilson, Opera House block 100
G. G. Eustis, Melrose, Ia. 100
Lalorena Gold and Copper Mining Company 100
Wortham Bros. Company 150
Golden Ranch Sugar and Cattle Company 9,000
Frank McCuddy, Clinton, Ia. 7,500
Dr. E. Hall and J. Brown 125
E. C. Talmage, S. D. Talmage and E. S. Barnum were indicted by the
Cook county grand jury.
George D. Talmage fled to Kansas City, Mo., where he conducted a
branch office in the same business. He was arrested at Kansas City,
Mo., on request of the chief of police of Chicago, for operating
the confidence game. Extradition papers were secured and Detective
Wooldridge brought him back. When his father's office was raided, at
52 Dearborn street, a number of letters was seized, among them were
several written from George D. Talmage, at Kansas City, Mo.
The following extracts are taken from George D. Talmage's letter to
his father:
"Saw old Blank today. He was easy. Inclosed find his check
for $1,000"; and, "When I mentioned bonds to old Tightwad
he fell over backwards and swallowed a set of false teeth."
One from a town in Kansas is said to have read: "Nothing
doing in this joint. The people here wouldn't buy gold
dollars for 90 cents."
One letter which reflected particularly upon the cupidity of our K.
C., U. S. A. citizens, runs: "I am giving it to these little Kansas
City suckers strong. I expect to be able to send you $1,000 the last
of the week."
E. C. Talmage, George D. Talmage and E. S. Barnum were placed on trial
before Judge Brentano for swindling the Rev. Peter A. Baart, Marshall,
Mo., out of $500.
E. S. Barnum was discharged and the Talmages found guilty.
A new trial was secured for George D. Talmage. His father, E. C.
Talmage, on May 10, 1907, was sentenced to an indefinite term in the
Joliet penitentiary.