HOOLEY DRAMA.

Taranaki Daily News, 1 July 1922, Page 12

HOOLEY DRAMA.

A REMARKABLE CASE ] V:. ' STORi OF GREAT SWINDLER. Ernest. Terah Hooley’s appeal against his sentence of three years' imprisonment for fraud in connection with the flotation of the Jubilee Cotton Mills,, Ltd., of Oldham, tfas recently dismissed. The history of the Hooloy case was interestingly summarised at the conclusion of the trial by the London Daily Telegraph, in the following editorial article:

An end has been put—at least for a time —to the financial activities of Mr. Hooley, who was sentenced to three years’ penal servitude at the Old Bailey on Saturday. The trial lasted twentysix days, and everyone must have sympathised with tho confession of weariness wrung from tho Common Serjeant when he began his eleven hours’ summing up. Yet the case was only heard at almost interminable length in order to give absolutely fair play to the persons who stood in the dock, for the record of the principal actor in the drama was such that there cannot have been the slightest doubt- in anyone’s mind from the very outset as to his being guilty of conspiracy to defraud the public. That ‘has been his constant occupation for many years past, and it has long been one of the most glaring and incomprehensible scandals of our time that this professional swindler has been j able to continue living’ in luxury and I engaging in the promotion of shady companies on a considerable scale, though modest, indeed, compared with his soaring ventures when he was in the heyday of his fame. He was made a bankrupt in 1898, in 1911, and again in 1921, and as he has never discharged or been discharged from his liabilities, they amount to about £700,000. But liabilities never weighed on Hooley’s spirits. Always, in his own phrase, “game as a linnet,” he never allowed any consideration for his old creditors to interfere with his plans for creating a fresh list of new ones, and this “boss of bosses”— as he was described by one of the witnesses in the trial just ended—has proceeded on his nefarious course, always on the look-out for new victims to pluck, and always ready to listen to any promising plan for taking advantage of the credulity of the public and the general desire to get rich quick by some lucky financial coup.

‘'WITHIN THE LAW.” It says much for Hooley’s astuteness and complete acquaintance with the laws dealing with company promoting that only once befoe during his thirty years’ career as a financier has he come under the ban of the law. He was found guilty in 1912 of obtaining cheques by false pretences from a rich and foolish young man who fell into his clutches and whom he stripped of his fortune in less than three months. Then he was sentenced to twelve months’ imprisonment in the second division; his present sentence will doubtless mark the ignoble end of an almost fabulous career.

The outlines of the story of the Jubilee Cotton Mill swindle can. be told very briefly. The plant of this Lancashire mill, which had previously passed through chequered fortunes, was bought in 1910 by an ex-Mayor of Derby, named Fletcher, for a low ‘figure, and worked by him during the following years. In 1919 Fletcher entered into an agreement with the landlords to purchase their interest in the building, and his total outlay on the concern would seem to have been about £15,000. In that year, as will be remembered, the cotton trade was booming and large profits were being made. Even the Jubilee Mill, though not an up-to-date property, earned a good profit, but Fletcher was in serious financial difficulties owing to hig large losses on certain Russian properties, and he therefore arranged with Hooley to sell the mill for £20,000 cash and 35,000 shares in the new company which was to be formed. Many other cotton mills were changing hands about that time on terms of gross over-capita-lisation, and Hooley and his associates were eager to be in the swim and get their share of what was going.

A MYTHICAL CONCERN, The syndicate set about the promotion of a company, and looked about for persons to take up the shares. They sold them first by promises of large dividends, and next by the pretence that large dividends had been earned and paid. The Jubilee Cotton Mill, which was to earn, such good returns on a. share capital of £150,000 and £30,000 debentures, had not a farthing of working capital, but that did not prevent the board of directors, with no accounts before them, from declaring an interim dividend of 33 1-3 per cent. The mill was valued by X practical expert, at the request of the Official Receiver, at not more than £20,000 or £30,000, in January, 1920, when the boom was still rising, and at less than £lO,OOO in June, 1921, when the slump was at its worst; and the shares, quoted as high as 32s in 1920, can now hardly be given away at 3d. AN AMAZING CAREER. Hooley has had an amazing career. Of recent years, of course, his character has been fly-blown, and reputable people have fought shy of contact with him, though he has never been short of clients. His great days came to an end as far back as 1898, and the younger generation never knew , Hooley in his prime, when he was the blazing comet of the financial world, and drew after him a motley crowd of high and low. all eager for a nod from the genius who thought in millions. Hooley was the son of a humble twist hand in a Nottingham lace factory, but he was born with great ideas. He had none of that respect for millions which overawed the careful, plodding Vic- ■ torians. He came to the conclusion that the way to fortune was to aim high and grasp at what other thought unattainable. “Go always for the biggest thing,” he once said: “Midway up the ladder is ‘clustered’ with thousands who have not the courage to grasp at the biggest deals. At the top of the ladder you have a clear, untroubled ' field.” The problem, perhaps, is not quite so simple as that, z but beyond question Hooley right! j r judged that the times were ripe, in the ‘nineties of last century, for the purchase of certain well-established and prosperous undertakings and for their flotation on a grandiose scale. The public, as he saw, were “on the feed,” and he fed them with both hands. He carried through some enormous deals. FROM BOOM TO CRASH. He started the “cycle boom,” with disjMtrojw results to the finance of most of |

the companies, though highly profitable to himself. He bought the Dunlop tyre for three millions, floated it for five millions, and in a few months saw it valued at seven millions. The public lost their heads. Hooley’s name was in every mouth. The man with the foxy face, who played the role of city super-magnate in loud country tweeds, who dressed like a racing, sporting squire, and professed to “hate town life and town sharks with their tricks and wiles,” added estate to estate, and bought houses and parks in a dozen counties. He was High Sheriff of Cambridgeshire, he nursed a constituency, and, according to his own account, he was ready to pay £50,000 for a baronetcy; while with sublime effrontery he presented St. Paul’s Cathedral with a magnificent set of gold communion plate. It could not last. Like many another before him, Hooley found money easier to get than to keep. His lucky vein ran out. He made bad mistakes. He lost all he had—

though he never was flush with hard cash —and the comet expired in the darkness in 1898. After the first bankruptcy,. the genius who in 20 months had floated 26 companies with a capital of £18,000,000 was reduced to thinking in thousands, and had to hunt his dupes, instead of keeping them waiting in the ante-room of his hotel. And now the last stage of all is penal servitude! It is a fine thpme for the moralist. But we are rather concerned to regret the bad influence which Hooley and men of his stamp have upon the financial and commercial world as a whole, in encouraging the belief that he and they are typical of modern capitalism—which they certainly are not—and in making people discontented with the slow returns of laborious work and patient application, when they see thees vulgar gamblers tossed up so suddenlyy to wealth and power. Hooley’s career points the moral that some measure of honesty is still a necessary ingredient to permanent success.