Investigation shows Morgan, 17 firms control $25.3 billion

Investigation shows Morgan, 17 firms control $25.3 billion
Members of the Pujo Committee, a United States congressional subcommittee which was formed to investigate the so-called "money trust", a community of Wall Street bankers and financiers that exerted powerful control over the nation's finances. File Photo by Library of Congress/UPI

WASHINGTON, Dec. 18, 1912 (UP) - Domination of $25,325,000,000 of the nation's wealth by 18 leading financial firms was the stupendous evidence, purporting to show actual existence of a money trust, presented to the Pujo investigating committee today.

Five firms, the J. P. Morgan, the Guaranty and the Bankers trusts companies, the First National and the National City bank, are said to have 341 directors in 112 corporations, with aggregate resources of $22,245,000,000.


The firm of J. P. Morgan & Co. was held up as the "heart" of the alleged combination.

With a staggering broadside of statistics, the Pujo committee dramatically presented its figures to the country at today's session. The data represented the efforts of 30 expert accountants of the committee.

An immense table or chart, six feet long, was exhibited to show the financial ramifications of the leading money kings of New York, Chicago and Boston. It was stated they represented only the giants' share of the actual money control of the country.

How these 18 firms have only 180 members, who hold 746 directorships in 134 of the wealthiest corporations of the nation, controlling total resources or capitalization of $25,325,000,000, was the evidence offered.


The statistics showed these 180 men have 385 directorships in 41 great banks and trust companies, with aggregate resources of $3,832,000,000; 155 directorships in 31 great railroad systems, capitalized at $12,193,000,000; six directorships in two express companies and four directorships in one steamship company, with a combined capital of $245,000,000 and a gross income of $97,000,000; 98 directorships in 28 industrial corporations, capitalized at $3,583,000,000 and earning over $1,145,000,000 annually; and 48 directorships in 19 public utility corporations, capitalized at $2,826,000,000 and earning over $428,000,000 annually.

While the arraignment of financial concentration by the "interlocking directorate" system was being shown, J. Pierpont Morgan himself was awaiting examination on the witness stand.

Interest of the Morgan firm in finance was shown as follows by the committee's statistics.

Control of 23 directors in 123 banks and trust companies, with resources of $1,406,000,000 and deposits of $989,000,000, four directors in four insurance companies, with assets of $1,249,000,000, 30 directors in 12 railroads capitalized $4,379,000,000 with mileage of 48,000 miles and a gross income of $72,000,000 annually; 12 directors in seven industrial corporations, capitalized at $1,989,000,000 and earning annually $899,000,000; four directors in three public utility companies, earning $10,036,000 annually; in all 63 directors in 39 corporations having resources of $10,036,000,000.


It was shown the Morgan firm has three directors each in the Astor Trust Co., Bankers Trust Co., Chemical national bank, First national bank and Guaranty Trust Co., and other directors in the Liberty national bank, National Bank of Commerce, National City bank, New York Trust Co., Fourth-st national bank of Philadelphia, Franklin and Girard trust companies, Philadelphia, and the Philadelphia national bank.

Representation by Morgan in the following insurance companies was also alleged: The Fidelity & Casualty Co., German-American Insurance co., the Mutual Life and Penn Mutual, and a controlling stock interest in the Equitable Life of New York.

Transportation companies in whose boards of directors Morgan representatives sit were said to be:

International Mercantile Marine Co.; Adams Express Co.; Atchison, Topeka & Santa Fe; Chicago Great Western; Erie; Lehigh Valley; New York, New Haven & Hartford, Northern Pacific, Pere Marquette, Reading and Southern.

"Morgan" directors are also ascribed to the Baldwin locomotive works, General Electric Co., International agricultural corporation, International Harvester Co., United States steel corporation (four), Westinghouse Electric Co., American Telegraph & Telephone Co., Philadelphia Rapid Transit Co., and the Public Service corporation of New Jersey.

It was also declared the Morgan company has two or three voting trustees controlling the Guaranty Trust Co. of New York, one of the three trustees of the Bankers Trust Co., one of three trustees of the Chicago Great Western railway, two of five in the Mercantile Marine trustees, one of three voting trustees of the Southern railway, and one trustee of the voting "trust" of the International agricultural corporation.


It was also shown J. Pierpont Morgan & Co. and the Guaranty Trust Co. have three common firm members and directors-Henry P. Davidson, William P. Porter and Thomas W. Lamont. The first two and George F. Baker were also declared to be voting trustees of the company. Like control of the Bankers Trust Co. was also set forth. Three Morgan members, it was stated, are also directors of the First National Bank.

How the First National, the Guaranty and Bankers Trust, the Chase National and National Bank of Commerce companies also have from three to nine "interlocking" directors was shown.

The statistical tables showed the Morgan firm, the First National, National City, Guaranty and Bankers trust companies together have 118 directors in 34 banks and trust companies, with resources of $2,679,000,000 and deposits of $1,983,000,000, and 30 directors in 10 insurance companies, with assets of $2,293,000,000; 105 directors in 32 transportation lines, capitalized at $11,784,000,000, with mileage of 105,200 miles; 63 directors in 24 industrial corporations, with a total capitalization of $3,339,000,000; 26 directors in 12 public utility corporations, capitalized at $2,150,000,000; total financial control of these five companies was stated to be 341 directors in 122 corporations, with aggregate resources of $22,245,000,000.


Details of the concentration of money interest of all of the other 17 "giants" were also shown.

When the committee met, it was not certain but that Morgan's examination might be deferred until tomorrow.

Fortified behind a small army of renowned lawyers, secretaries, clerks, accountants and flunkeys, and armed with piles of "defense ammunition" in the shape of documents and records, it was plain Morgan was on the defensive today.

To draw from Morgan's own lips, under oath, the history of many of the great financial coups of late years, was planned by the committee. While Morgan, it was reported, would not be asked literally to open his private bank book to the committee, the Morgan interests, private and corporate, were threatened by the searchlight of publicity.

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