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THE ATLANTIC CAPER wren Finance Company Story Revealed In Earnings By GORDON GRANT TORONTO (CP)--Used cows .., vace horses... adventure in the Bahamas. . . restatirants . . . discount stores. . . loans without collateral. . » wwe w Paris . . « fat profits. These ingredients in one pot apparently are a recipe for dis- aster. The mixture was concocted by Atlantic Acceptance Corp, an whipped up by the royal com- mission investigating the fi- mance company's downfall in June, 1965. The commission, under Mr. casi some light on details which so far are clouded. One of the most unusual operations of Atlantic was its deglings in new and used cows. The camoany financed Valley Farms and Enterprises which sold cows to farmers, some- times having to repossess for non-payment, After two unprofitable years, the cow caper went kaput. NAGS LET FIRM DOWN But Valley Farms, run on the instruction of Mr, Morgan, wasn't through, It went into the race horse business, The nags didn't treat the company well, or no collateral. A Buffalo plas- tics firm, Nevil Enterprises Inc., borrowed more than $2,000,000 from the group on security of jonly $157,000. Nevil Enterprises, unlike most of the other companies | Atlantic, still is operating. } /STORE GOES UNDER Not so fortunate was Fred- various other operations asso-| ciated with the hotel. _ Albert Shepherd, commission counsel, said Atlantic might be alive today had it not been for its "adventure in The Ba-| hamas." FUNDS TIED UP sidiaries, and Aurora Leasing Atlantic's money was tied up|controlied by Mr. Morgan. in the unprofitable venture with] The store was in Treasure Is London, Ont., owing $1,680,000. Its eetem ee et fesse le BGUFCES BG VURGS no quick way out, Mr. Shepherd|land shopping centre in which said that had the investment) Atlantic also had a stake, been more liquid, the $5,000,000) pe paid, The commission spent several|deeply involved with Atlantic, days on the Bahamian opera-| centre was built with debt could probably have been| money by 'British. Mortgage land Trust Co., which was itself money and added, 'I kept the| money myself." | panies with substantial {profits to Mr. Kaftel and on each occas- accruing in the process. It was|sion was accompanied by stock Reid, who denied he told Pike|estimated that Morgan compan-|broker R .A. Goodfellow, who the money was available andlies may have made more than|was tossed out of the Toronto who said he knew nothing about) it, has been charged with brib- ery. proved te be just that for Lon- don housewife Mrs. Julia Faust. On April 30, 1963, Mrs. Faust paid $6,000 for slightly more rick's Department Stores offnan two acres of land adjoin- which never turned a profit and went under three sre Adelaide Accemtance and Commodore| {Sales Acceptance, Atlantic sub- ing the Treasure Island shop- ping centre and sold it the same day for $100,000 to Treasure Is- jand Properties, Thie camnany then rented it to Treasure Island Gardens for $40,000 a year on a 99-year lease. The area now houses a hockey arena. |VENTURZS IN PARIS | From London, Ont., to Paris, France, went Mr. Morgan to see Frank Kaftel, a stock promoter, who, according to evidence, con-} ducted a vigorous campaign in $1,000,000 from trading Ana-|Stock Exchange three weeks logue. When control of the com-|ago because it was found he had pany passed from the Morgan|*'been a party to, or assisted in, \which became entangled with| Treasure Island, ho wever,|group, the company went bank-|creating an abnormal market rupt. condition in respect to the Mr. Morgan made four visitsishares of Analogue," © folded, THE OSHAWA TIMES, Mondey, September 12, 1966 17° Mr. Morgan made a fat profit|fied that Walton, Wagman within 15 months of buying con-|Morgan made $97,272 after bi trol of Aurora Leasing, a com-jing Aurora with funds from its poor which owed Atlantic $12,-|own 000 when both companies treasury Leonard Eades, a chartered accountant, also made a fa: TESTIFY TO PROFITS profit from selling a finan A chartered accountant testi-icompany. | | | | As a result of the British! turone to sell shares of Ana- @ NOW SHOWING! 6 tion which included money be-)/yortgage funds going in' Trea- ing loaned to numerous inter-re!| sire Island, the company's lated companies. One witness! mortgage manager, William: A. said there still is a chance for|pixe went to jail for taking a Atlantic to get its money back.) pine Atlantic also went into the res-| Pike said that when he was taurant business in Toronto by| approached about the mortgage loaning, interest-free and with+|he was told by London lawyer Justice Samuel Hughes of the Ontario Supreme Court, in six months of public and sometimes bizarre, hearings has taken evi- dence from 113 witnesses and heard millions of words of testi- mony. logue Controls Inc. | Shares of Analogie soared to| more than $5 from $1 in a mat-| ter of weeks following one of M! Morgan's trips. | One witness. said control of! Analogue circulated between va-; "It's FUN! It's FIGHTIN! [t's FIREWORKS! IT'S ELVIS AT HIS BEST @ SHOW TIMES @ either, and in three years $10,- 700 went down the drain, of which $7,000 was on racing operations and the remainder on buying and selling opera- tions. Another unusual facet of Val- PLAYING SHOW TIMES --~ 2:10 -- 4:35 -- 7:00 -- 9:25. LOS 9:15 The hearings reopen today fo!- owing a summer recess ard of- ficials say they expect to be tak- evidence until early 1967. tlantic collapsed when | couldn't pay a $5,000,000 debt-- at the time its assets were listed at more than $145,000,000. ley Farms was that it gave $177,571 to Morgan, Walton and Wagman as repayment of loans which they didn't make and it didn't receive, a chartered ac- countant testified. In line with its odd operating The commission wants to find out. among other things, why such a large and appare well-based company went methods, the company also |bought $125,000 of debentures in ntly|a company which was in re-|by Morgan which in turn got its) un-|ceivership and wrote off the|money from Atlantic der because of a paltry $5,000,-;amount as an operating @X-) TWO FACTS EMERGE The facts are clear: 1. Losses could be as much at $64,000,000; 2. C. P, Morgan, founder and t of Atlantic until its , and accountants William Walton and Harry Wagman have been ment more fre- quently in evidence than any other persons. Mr. Morgan, according to test- imony, was the central figure in Atlantic's operations and Mr. Justice Hughes has commented: "T realize a man's judgment is never uniformly right, but it seems impossible to believe his judgment could be so uniformly wrong in all these enterprises." Mr. Morgan's evidence has not been made public--he gave it from his bed prior to entering a Toronto hospital with a blood disorder--but when it is it may TH pense. When the farm went bankrupt it owed Atlantic $1,300,000. From the farm in eastern On- |tario, the commission traced At- HJantic's dealings to The Ba- hamas where the company had an $11,000,000 stake in the luxu- rious Lucayan Beach Hotel and Do You Have Your '66-'67 MEMBERSHIP TICKETS ? | | See Poge 14 LITTLE BLUE HORSE LOUNGE Presents This Week Chef Adams Bringing Back More of Your Favorites in Country and Western. -- at the -- HOTEL LANCASTER "The Friendly Spot" THEURY FONDA: ROBERT ANGEL: WERLE ceonce MONTGOMERY:1Y HARON: CHARLES BROKSON HANS CHRISTIAN BLECH WERNER PETERS: JAMES MacARTHUR and TELY SAVALAS Prntuand ay WELTON GPERLINA. PonLiP YORDAN © Wrenen by PreciP YORDLN Me TON PLUS 42 MINUTES CARTOONS -- Children Under 12 FREE WIN! WIN! WINI PREE PIZZA Courtesy -- Robbie's Drive-in PREE WET WASH -~ Boyd's Esso Hwy. No. 2 DRAW ON TICKET OSHAWA uit! DRIVE-IN Terrific Twin- ADULT is SHAW ROBERT RYAN DANA ANDREWS IER Bill Tonight !! OLOR* SPERLING, gO MESO TECHNIC! OF BUGS BUNNY STUBS TONIGHT Bor Oftice Opens 7:30 Show Starts Dusk. THE WILDEST ¥ POKER GAME IN THE WEST! ' HENRY FONDA LANE JASON ROBARDS FELEER COOKS ABIG HAND) Twe "HARPER" et 8:00 P.M. "LITTLE LADY" ot 10:00 TE PEE DRIVE-IN LITTLE LADY4, ae Me te ee Se Re ee a ae a ee 8 THEATRE | Return Engagement P20. ig onive-ns | DIRECT FROM ITS } | RESERVED SEAT ENGAGEMENTS! { i] out security, taurant and tavern where spag-|ranged. hetti and song are popular Eventually, Mr. Morgan) $22,500 to J&hn| Donald Reid that there was $10,- Shemilt to buy Old Angelo's res-|000 available if the deal was ar- Pike said he accepted the rious Morgan ~ controlled com- gained 80 per cent control and sold it back to Shemilt who fi, nanced the purchase through a loan from a company controlled pIZZA Phone 723-0241 or 728-0192 Atlantic and its many subsi- ' diaries and related companies | EPI s frequently lent money with little! OH YEAH! LE GRANDE CHARLES LICENSED 1S BACK I Versatile CHARLES ECKSTEIN @ Comedian, Vocelist and M.C. oe 6 BOROTHY P @ FIERY ELAINE'S EXOTIC DANCING... 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