On October 31, a balance sheet was made and showed that the company had lost. its entire capital stock "of $100,000 and in addition the sum of "$84,465.60, from the mathematical "reserve. In conquence of decisions by Mr, Steen and his associates the fact became Known that they were desirous of selling their controlling interest the stock of company, In January 1927 Mr. A. C. Mack, who claimed to represent a group of Chinese interests, came forward to buy 840 shares leaving to Mr. Steen and his associates 41 shares. The memorandum known as Bxhibit the ease in reply to Mack's request to Mr. Steen was as follows "Tarn over C, 0. C. shares, letters of resignation from Board, Eisler, Wootten and Steen, Mex $200,000 securities pay into C. 0. C, We take R. S. Shares." "A few days thereafter, Mr. Steen was advised that the Chinese interests for whom Mack was acting were represented bya British lawyer named Kentwell, a man named Young and a Chines named Miao, "With the financial affairs of the company in such a precarious condi tion, it was of course natural, "the Judgment states," that Mr. Steen, eclates should be, anxious: way whereby they, might be able to recoup at least part of their losses of $241,000, casloned by their investments" in. this then totally insolvent corporation".—Such was the situation the latter part of January—1927, when Mr, Steen, in behalf of himself and his associates, put forward this proposal or the disposition of their stock with the privilege of withdrawing from the treasury of the company the 258 shares of Realty Syndicate stock of the acknowledged value of $114,687.
The Modus Operandi The plan was to require Kentwell and his associates to pay into the C.0.C, $200,000 first as securities. which, as finally agreed, should be money, whereupon Steen and his associates were to deliver to Kentwell 840 shares of the C.0.C, stock and Steen was to be permitted to take from the treasury of the company $114,657 of its investments im. the shape of the 358 shares of Realty Syndicate stock donated three years before.
What actually took place was. that on the morning of January 26 Kentwell and his associates appeared at Steen's office with a writing, jin Chinese which they dained was a letter from the manager of the China Savings Bank, stating that a transfer had been made of $200,000 from the account of a Chinese -by the name of Vie Kee, in the China Savings Bank, to the credit of the C.0.C. Investigation proved that this letter simply stated. that Kee would transfer or authorize the transfer of $200,000 from his account in the bank to the C.0.C. Upon being informed that the $200,000 was have to be transferred, actually, Wang the manager of the bank modified the letter to read that the sum had actually been' placed to the C.0.C. credit, It will be observed that Mr. Steen did not know why Vie Kee was at that time and neither does it appear that Vie Kee was consulted by the manager of the bank when it was elnimed shat Wang changed the Chinese letter in question. When Mr, Wang was oilled as" witness for the
Text read from the printed page and cleaned; old type leaves the occasional error.