WHEREIN BLACKIE DAW PLAYS A BRIEF CHARACTER
BIT
Andy Grout came into Doc Turner's office in a troubled mood, every
down-drooping line in his acid countenance absolutely vertical.
"We've made a mistake," he squeaked. "This young Wallingford is a
hustler, and he's doing some canvassing himself. In the past week he's
taken at least forty members for his loan company, and every man Jack
of them are old members of ours."
Doc Turner began rubbing his frosted hands together at a furious rate.
"Squinch has sold us out!" he charged. "He's let Wallingford copy that
list on the sly!"
"No, I don't think so," said Grout, more lugubrious than ever. "I made
some inquiries. You know, a lot of these fellows are customers of
mine, and I find that he just happened to land on some of them in the
first place. One recommends him to the others, just as we got them.
If we don't sell him that list right away he won't need it."
Together they went to Squinch and explained the matter, very much to
that gentleman's discomfiture and even agitation.
"What's his plan of operation, anyhow?" complained Squinch.
"I don't understand it," returned Andy. "I found out this much,
though: the members all expect to get rich as soon as the company
starts operating."
Mr. Squinch pounded his long finger-tips together for some time while
he pondered the matter.
"It might be worth while to have a share or two of stock in his
company, merely to find out his complete plan," he sagely concluded.
"If he's getting members that easy it's quite evident there is some
good money to be made on the inside."
This was the unanimous opinion of the entire five members of the board
of directors, and as each member was in positive pain on the subject
of "good money on the inside," they called a meeting that very
afternoon in Mr. Squinch's office, inviting Mr. Wallingford to attend,
which he did with inward alacrity but outward indifference.
"Mr. Wallingford," said Mr. Squinch, "we have about decided to accept
your offer for our list, but before doing so we will have to ask you
to explain to us the organization of your company."
"Very simple," Wallingford told them cheerfully. "It's incorporated
for a hundred thousand dollars; a thousand shares of a hundred dollars
each."
"All paid in?" Mr. Squinch wanted to know.
"All paid in," replied Mr. Wallingford calmly.
"Indeed!" commented Mr. Squinch. "Who owns the stock?"
"My four office assistants own one share each and I own the balance."
A smile pervaded the faces of all but one of the members of the board
of directors of the defunct National Building and Loan Association.
Even Tom Fester's immovable countenance presented a curiously strained
appearance. Strange as it may seem, the dummy-director idea was no
novelty in New Jersey.
"I take it, then, that the paid-in capitalization of the company is
not represented in actual cash," said Mr. Squinch.
"No," admitted Wallingford cheerfully. "As a matter of fact, at our
first meeting the directors paid me ninety-five thousand dollars for
my plan of operation."
Again broad smiles illuminated the faces of the four, and this time
Tom Fester actually accomplished a smile himself, though the graining
might be eternally warped.
"Then you started in business," sagely deduced Mr. Squinch, with the
joined finger-tip attitude of a triumphant cross-examiner, "having but
a total cash capitalization of five thousand dollars."
"Exactly," admitted Wallingford, chuckling. There was no reservation
whatever about Mr. Wallingford. He seemed to regard the matter as a
very fair joke.
"You are a very bright young man," Mr. Squinch complimented him, and
that opinion was reflected in the faces of the others. "And what is
your plan of loans, Mr. Wallingford?"
"Also very simple," replied the bright young man. "The members are in
loan groups, corresponding to the lodges of secret societies, and, in
fact, their meetings are secret meetings. Each member pays in a dollar
and a quarter a week, and the quarter goes into the expense fund."
The five individually and collectively nodded their heads.
"Expense fund," interpolated Doc Turner, his blue-tipped nose
wrinkling with the enjoyment transmitted from his whetting palms,
"meaning yourself."
"Exactly," agreed Wallingford. "The dollar per week goes into the loan
fund, but at the start there will be no loans made until there is a
thousand dollars in the fund. Ten per cent. of this will be taken out
for loan investigations and the payment of loan officers."
"Meaning, again, yourself," squeaked Andy Grout, his vertical lines
making obtuse bends.
"Exactly," again agreed Wallingford. "Twenty-five per cent. goes to
the grand annual loan, and the balance will be distributed in loans as
follows: One loan of two hundred and fifty dollars, one loan of one
hundred, one of fifty, four of twenty-five and fifteen of ten dollars
each. These loans will be granted without other security than an
unindorsed note of hand, payable in four years, without interest, and
the loans will be made at the discretion of the loan committee,
meeting in secret session."
Mr. Squinch drew a long breath.
"A lottery!" he exclaimed.
"Hush!" said J. Rufus, chuckling. "Impossible. Every man gets his
money back. Each member takes out a bond which matures in about four
years, if he keeps up his steady payments of a dollar and a quarter a
week without lapsation beyond four weeks, which four weeks may be made
up on additional payment of a fine of twenty-five cents for each
delinquent week, all fines, of course, going into the expense fund."
Doc Turner's palms were by this time quite red from the friction.
"And how, may I ask, are these bonds to be redeemed?" asked Mr.
Squinch severely.
"In their numbered order," announced Mr. Wallingford calmly, "from
returned loans. When bond number one, for instance, is fully
paid up, its face value will be two hundred and fifty dollars. If
there is two hundred and fifty dollars in the redemption fund at that
time--which the company, upon the face of the bonds, definitely
refuses to guarantee, not being responsible for the honesty of its
bond-holders--bond number one gets paid; if not, bond number one waits
until sufficient money has been returned to the fund, and number
two--or number five, say, if two, three and four have lapsed--waits
its redemption until number one has been paid."
A long and simultaneous sigh from five breasts attested the
appreciation of his auditors for Mr. Wallingford's beautiful plan of
operation.
"No," announced Mr. Squinch, placing his finger-tips ecstatically
together, "your plan is not a lottery."
"Not by any means," agreed Doc Turner, rubbing his palms.
Jim Christmas, who never committed himself orally if he could help it,
now chuckled thickly in his throat, and the scarlet network upon his
face turned crimson.
"I think, Mr. Wallingford," said Mr. Squinch, "I think that we will
accept your offer of two shares of stock each for our list."
Mr. Wallingford, having succeeded in giving these gentlemen a grasping
personal interest in his profits, diplomatically withheld his smile
for a private moment, and, turning over to each of the five gentlemen
two shares of his own stock in the company, accepted the list.
Afterward, in entering the item in his books, he purchased for the
company, from himself, ten shares of stock for one thousand dollars,
paying himself the cash, and charged the issue of stock to the expense
fund. Then he sat back and waited for the next move.
It could not but strike such closely calculating gentlemen as the new
members that here was a concern in which they ought to have more than
a paltry two shares each of stock. Each gentleman, exercising his
rights as a stock-holder, had insisted on poring carefully over the
constitution and by-laws, the charter, the "bonds," and all the other
forms and papers. Each, again in his capacity of stock-holder, had
kept careful track of the progress of the business, of the agents that
were presently put out, and of the long list of names rapidly piling
up in the card-index; and each made hints to J. Rufus about the
purchase of additional stock, becoming regretful, however, when they
found that the shares were held strictly at par.
In this triumphant period Wallingford was aggravatingly jovial, even
exasperating, in the crowing tone he took.
"How are we getting along? Fine!" he declared to each stock-holder in
turn. "Inside of six months we'll have a membership of ten thousand!"
And they were forced to believe him.
Probably none of the ex-members of the defunct loan association was so
annoyed over the condition of affairs as Ebenezer Squinch, nor so
nervously interested.
"I thought you intended to begin collecting your weekly payments when
you had two hundred and fifty members," he protested to Wallingford,
"but you have close to five hundred now."
"That's just the point," explained Wallingford. "I'm doing so much
better than I thought that I don't intend to start the collections
until I have a full thousand, which will let me have four thousand in
the very first loan fund, making two hundred and fifty a week to the
expense fund and a hundred a week for the loan committee, besides one
thousand dollars toward the grand annual distribution. That will give
me twenty-six hundred to be divided in one loan of a thousand, one of
five hundred, one of two hundred and fifty, two of a hundred, four of
fifty, ten of twenty-five, and twenty of ten dollars each; a grand
distribution of thirty-nine loans in all. That keeps it from being
a piker bet; and think what the first distribution and every
distribution will do toward getting future membership! And they'll
grow larger every month. I don't think it'll take me all that six
months to get my ten thousand members."
Mr. Squinch, over his tightly pressed finger-tips, did a little rapid
figuring. A membership of ten thousand would make a total income for
the office, counting expense fund and loan committee fund, of three
thousand five hundred per week, steadily, week in and week out, with
endless possibilities of increase.
"And what did you say you would take for a half interest?" he asked.
"I didn't say," returned Wallingford, chuckling, "because I wouldn't
sell a half interest under any consideration. I don't mind confessing
to you, though, that I do need some money at once, so much so that I
would part with four hundred and ninety-nine shares, right now, and
for spot cash, for a lump sum of twenty-five thousand dollars."
"Bound to keep control himself," Mr. Squinch reported to his
_confreres_, after having reluctantly confessed to himself that he
could not take care of the proposition alone. "I don't blame him so
much, either, for he's got a vast money-maker."
"Money without end," complained Andy Grout, his mouth stretching
sourly down to the shape of a narrow croquet wicket; "and the longer
we stay out of this thing the more money we're losing. It's better
than any building-loan."
There was a curious hesitation in Andy Grout's voice as he spoke of
the building-loan, for he had been heartbroken that they had been
compelled to give up this lucrative business, and he was not over it
yet.
Doc Turner rubbed his perpetually lifeless hands together quite
slowly.
"I don't know whether we're losing money or not," he interjected.
"There is no question but that Wallingford will make it, but I suppose
you know why he won't sell a half interest."
"So he won't lose control," said Squinch, impatient that of so obvious
a fact any explanation should be required.
"But why does he want to keep control?" persisted Doc Turner. "Why, so
he can vote himself a big salary as manager. No matter how much he
made we'd get practically no dividends."
It was shrewd Andy Grout whose high squeak broke the long silence
following this palpable fact.
"It seems to me we're a lot of plumb idiots, anyhow," he shrilled. "He
wants twenty-five thousand for less than fifty per cent. of the
stock. That's five thousand apiece for us. I move we put in the five
thousand dollars apiece, but start a company of our own."
Mr. Grout's suggestion was a revelation which saved Jim Christmas from
bursting one of his red veins in baffled cupidity. Negotiations with
Mr. Wallingford for any part of his stock suddenly ceased. Instead,
within a very short time there appeared upon the door of the only
vacant office left in the Turner block, the sign: "The People's
Cooperative Bond and Loan Company."
Mr. Wallingford did not seem to be in the slightest degree put out by
the competition. In fact, he was most friendly with the new concern,
and offered Doc Turner, who had been nominated manager of the new
company, his assistance in arranging his card-index system, or upon
any other point upon which he might need help.
"There's room enough for all of us," he said cheerfully. "Of course, I
think you fellows ought to pay me a royalty for using my plan, but
there's no way for me to compel you to do it. There's one thing we
ought to do, however, and that is to take steps to prevent a lot of
other companies from jumping in and spoiling our field. I think I'll
get right after that myself. I have a pretty strong pull in the state
department."
They were holding this conversation three days after the sign went
up, and Mr. Squinch, entering the office briskly to report a new
agent that he had secured, frowned at finding Mr. Wallingford
there. Business was business with Mr. Squinch, and social calls
should be discouraged. Before he could frame his objection in words,
however, another man entered the office, a stranger, a black-haired,
black-eyed, black-mustached young man, of quite ministerial appearance
indeed, as to mere clothing, who introduced himself to Doc Turner as
one Mr. Clifford, and laid down before that gentleman a neatly folded
parchment, at the same time displaying a beautiful little gold-plated
badge.
"I am the state inspector of corporations," said Mr. Clifford, "and
this paper contains my credentials. I have come to inspect your plan
of operation, and to examine all printed forms, books and minutes."
Mr. Wallingford rose to go, but a very natural curiosity apparently
led him to remain standing, while Doc Turner, with a troubled glance
at Ebenezer Squinch, rose to collect samples of all the company's
printed forms for the representative of the law.
Mr. Wallingford sat down again.
"I might just as well stay," he observed to Doc Turner, "because my
interests are the same as yours."
Mr. Clifford looked up at him with a very sharp glance, as both Mr.
Turner and Mr. Squinch took note. At once, however, Mr. Clifford went
to work. In a remarkably short space of time, seeming, indeed, to have
known just where to look for the flaw, he pointed out a phrase in the
"bond," the phrase pertaining to the plan of redemption.
"Gentlemen," said he gravely, "I am very sorry to say that the state
department can not permit you to do business with this bond, and that
any attempt to do so will result in the revoking of your charter. I
note that this is bond number one, and assume from this fact that you
have not yet sold any of them. You are very lucky indeed not to have
done so."
A total paralysis settled upon Messrs. Turner and Squinch, a paralysis
which was only relieved by the counter-irritant of Wallingford's
presence. To him Mr. Squinch made his first observation, and it was
almost with a snarl.
"Seems to me this rather puts a spoke in your wheel, too,
Wallingford," he observed.
"Is this Mr. Wallingford?" asked Mr. Clifford, suddenly rising with a
cordial smile. "I am very glad indeed to meet you, Mr. Wallingford,"
he said as he shook hands with that gentleman. "They told me about you
at the state department. As soon as I've finished here I'll drop in to
look at your papers, just as a matter of form, you know."
"If you refuse to let us operate," interposed Mr. Squinch in his most
severely legal tone, "you will be compelled to refuse Mr. Wallingford
permission to operate also!"
"I am not so sure about that," replied Mr. Clifford suavely. "The
slightest variation in forms of this sort can sometimes make a very
great difference, and I have no doubt that I shall find such a
divergence; no doubt whatever! By the way, Wallingford," he said,
turning again to that highly pleased gentleman, "Jerrold sent his
respects to you. He was telling me a good story about you that I'll
have to go over with you by and by. I want you to take dinner with me
to-night, anyhow."
[Illustration: "I shall be very much pleased," said Wallingford]
Jerrold was the state auditor.
"I shall be very much pleased," said Wallingford. "I'll just drop into
the office and get my papers laid out for you."
"All right," agreed Mr. Clifford carelessly. "I don't want to spend
much time over them."
Other fatal flaws Mr. Clifford found in the Turner and Company plan of
operation, and when he left the office of The People's Cooperative
Bond and Loan Company, the gentlemen present representing that concern
felt dismally sure that their doom was sealed.
"We're up against a pull again," said Doc Turner despondently. "It's
the building-loan company experience all over again. You can't do
anything any more in this country without a pull."
"And it won't do any good for us to go up to Trenton and try to get
one," concluded Mr. Squinch with equal despondency. "We tried that
with the building-loan company and failed."
In the office of The People's Mutual Bond and Loan Company there was
no despondency whatever, for Mr. Wallingford and the dark-haired
gentleman who had given his name as Mr. Clifford were shaking hands
with much glee.
"They fell for it like kids for a hoky-poky cart, Blackie," exulted
Wallingford. "They're in there right this minute talking about the
cash value of a pull. That was the real ready-money tip of all the
information I got from old Colonel Fox."
They had lit cigars and were still gleeful when a serious thought came
to Mr. Clifford, erstwhile Mr. Daw.
"This is a dangerous proposition, though, J. Rufus," he objected.
"Suppose they actually take this matter up with the state department?
Suppose they even go there?"
"Well, they can't prove any connection between you and me, and you
will be out of the road," said Wallingford. "I don't mind confessing
that it's nearer an infraction of the law than I like, though, and
hereafter I don't intend to come so close. It isn't necessary. But in
this case there's nothing to fear. These lead-pipe artists are scared
so stiff by their fall-down on the building-loan game that they'll
take their medicine right here and now. They'll come to me before
to-morrow night, now that I've got them, to collect their money in a
wad in the new company. They might even start work to-night."
He rose from the table in his private office and went to the door.
"Oh, Billy!" he called.
A sharp-looking young fellow with a pen behind his ear came from the
other room.
"Billy, here's a hundred dollars for you," said Wallingford.
"Thank you," said Billy. "Who's to be thugged?"
"Nobody," replied Wallingford, laughing. "It's just a good-will gift.
By the way, if Doc Turner or any of that crowd back there makes any
advances to you to buy your share of stock, sell it to them, and
you're a rank sucker if you take less than two hundred for it. Also
tell them that you can get three other shares from the office force at
the same price."
Billy, with great deliberation, took a pin from the lapel of his coat
and pinned his hundred-dollar bill inside his inside vest pocket, then
he winked prodigiously, and without another word withdrew.
"He's a smart kid," said Blackie.