BANKING SHARKS OF THE ARID ZONE.

Ashburton Guardian, Volume VII, Issue 1951, 22 September 1888, Page 4

BANKING SHARKS OF THE ARID ZONE.

An Atnferlflsn journal which haa been handed to us by a correppsndent contains an natoundlng article exposing »hs : an principled nnnoer fn which financial blood-BuckeTß are vlctimbing the eetilere who attracted by unprincipled railroad c joipanleb and other dealers In land are pouring m constant . streams iato the 11 A rid Z me," wh'ch comprises Eastern Colorado »nd Western Kinaas and Nebrtaka. It la stated that the land is " absolutely erid,'" bat "the railroad oorporatlona that have built parallel and competing lines through the arid zme resolved to attempt to induce »grloultural aettlera to enter the com^ry. They advertised the wondeifal agricultural resources of thp plains of. .high altitude throughout V. >• Mississippi Valley, wh r oi Is the great breeding ground of men possessing migratory inatlno's. They have succeeded m luring tens of thousands of Ignorant emigrants into the grany deaert. It is evident that almost every one of these settlers fetohed some money or seme personal property, suoh as horses or oattle, with them. And m addition to the property which they brought with them, they took up Government land, which they oan mortgage." Then It is that the deluded emigrants fall into the hands of so -called " bankers," who might more fitly be described as "banking sharks' one 'of whom !s described an having boasted of his nefarious operations m the following terms:— "lt is the agricultural settler on whom I fatten. Ha never raises a sufficient number of consecutive crops to enable him to live for a term of years, atd he never will if he remains In the arid zone, fie borrows small Bums of money from me, for the ase of which be has to pay from 3 to 5 per cent per month, and to seoure the payment of the note he gives me a ohattel mortgage which oovers all his personal property. Occasionally, if the Reason happens to be rainy, he pays tbe note. Bat the rule is that when the note falls doe he is unable to pay. Now, •11 the notes contain a clause In whioh the borrower agrees to pay attorney fees if the note is collected by law. I hire an attorney, who divides these fees with me Wben a note is not paid on maturity I threaten, through my attorney, to fore* olose the ohattel mortgages: This threat frightens the farmer, and he promptly applies to one of the loan agents, who loan Eastern capital on worthless lands lying m the arid West, for a loan on his farm. He gets the desired amount of mocoy, lees 10 per oent commission, and agrees to p»y from 7 to 10 per cent, interest on the amount applied for— generally a few hundred dollars, H« takes np tbe cote which I held, pays his merchant, and if he has any money left he deposits it In my bank, and I lend it to his neighbours and pocket the interest it earns. This money, which he raised by laying a mortgage on his farm, Is soon exhausted. Again he enters my bank to

obtain discount. The man Is doomed to bankrupt cf, and I but has'en the arrival of the catastrophe. I know preoisely how much or how little his personal property is wottb. I have frequently seen his teams and waggons. I kuow the number of cattle and hogs he owns. Say he has $600 worth of personal property, I loan to him on this deal, whloh I consider final, $300, and I demand and obtain a ohattel mortgage on all his personal property to seoute *he payment of his note. When tho note falls due I press for payment. He cannot pay. I foreclose the mortgage, and as there Is no money m the country I buy m the property at the face of the note, and that man is as naked of property as a newborn baby. I send the Btock to my ranoh tb hold for sale to new comers, or, if it gathers too* fast, as it is apt to do In busy seasons, I ship It to market But, whatever I do with It I make my money double itself. Last Fall I bought fn teams and harness and waggons, full outfits, for less than $40, and sold the same outfits for $150. Well, the tiller of the boII having been bankrupted we have no farther use for him, and he disappears. No one knows and no one oares Where he has

gone. And, as he is typiosl of his clasu, hundreds of men disappear with him, and hundreds of farms are thrown upon the hands of the farm mortgage negotiating companies.

"The first grist of men has been ground into bankrupts, and while we are grinding this grist the railroads steadily advertised the lacd adjsoent to their respective lines, and the mortgage negotiating companies advertised the fact that they had cheap and produotive farms for sale on long time, and together they bring new men into the coontry. These emigrants are generally farm laborers who have saved a few hundred dollars, or the sons of farmers who have been orowded out of the family homesteads and who have had a few hundred dollars given to them on whloh to start m life. These men bay farms from the mortgage negotiating companies at low rates and long time. They are solemnly assured that their predecassors were lazy and that they did not know how to farm. They buy teams, generally of me, or of men engaged In banking, and go to work hopeful of the futnra. They soon run ahort of money, j and apply to me for a loan te tide them over temporary financial embarrassments. Of course I accommodate them, but I never forget to take the ohattel mortgage which secures the payment of the note that beard from 3 to 5 per cent, interest per month- Then thesa emigrants stalk down the financial trail which leads to bankrnptoy, and they, too, disappear, and aem customers appear In my banking office; Every man who has had anything to do with the emigrants has made money out of thorn. Shopkeepers, lumber dealers, butchers, loan agents, and bankers have steadily grown rich, and the agrlor' i turlst alone has steadily grown poo»" " l ' A poorer as the harvest years *ol>' A v vri did the work. We profits U 4. by ; v "It takes about tb- v fcjr hla labor * oat one of thW - - ea I™ B t0 olean only ™nmr«s' mtm wh ° labor fn fche Bnt ..A. dd ln <*ustry m the country. nnllml> ™T BUpply of eml B rantß «<*m to be 5« - 8d ' the banking business Is con"p uonaly proßperona."