Yalemen Convicted

"Boys, you've got the world by the tail," chuckled Yale's old Professor Irving Fisher some ten years ago when a couple of bright young graduates outlined their plans for exploiting a patented automatic stop & go traffic signal. By last week these two bright young Yalemen had discovered that if they did have the world by the tail, that was a very poor place to catch it. In Federal District Court in Manhattan Wallace Graydon Garland, class of 1925, and Arnold Caverly Mason, class of 1928, were convicted of conspiracy and mail fraud on 43 counts in a flamboyant security swindle.

Yaleman Mason appeared to have been merely the tool of Yaleman Garland, who was known among his unsavory associates as "The Wizard." The first Garland wizardry was promotion of Automatic Signal Corp. to make his patented traffic light. Among the original investors were two du Fonts, Charles Michael Schwab, who served for a time as a director, and old Economist Fisher, who sank no less than $750,000 in the enterprise. Automatic Signal is still a going concern with Mr. Fisher trying to get his money back as board chairman.

Yaleman Garland went to Pittsburgh's Shady Side Academy, but his financial progress ran roughly parallel to valuation placed on his patent, which he acquired for $500 in stock. By easy stages this pat ent was written up to $7,500, then to $1,000,000, again to $3,250,000 and finally to a good round $32,500,000. At that point Yaleman Garland left Automatic Signal to Professor Fisher, taking off for a land of pure corporate romance. This he populated with no less than 30 companies, the functions of which were even vaguer than their assets. More than $3,000,000 worth of quite worthless stock in one called Public Service Holding Corp.

and its subsidiaries was sold to the public, an activity which eventually led to the Federal indictments (TIME, Nov. 18, Still loyal to the boys who had the world by the tail, Professor Fisher ap peared as a witness in their behalf, drawing from energetic Assistant U. S. Attorney William Power Maloney a challenge as to his economic competency. Mr. Fisher, he told the jury, was a "dusty old academic," "a slightly befuddled expert." Shown news stories of Roger Ward Babson's prediction of the 1929 crash, which were publicly pooh-poohed by Mr. Fisher at the time, the white-goateed old Professor declared:

"Babson is a nice gentle man. He receives great publicity and has a large following but he has no academic standing." Convicted with Yalemen Mason & Garland was as pretty a crew of stock-jobbers and boiler-shop operators as ever hooked a widow, including Dave ("The Duke") Durbin, whose sales aids were white spats, a Japanese chauffeur and a Cadillac V16. One of the ablest was a handsome fellow named Walter M. Barr whose specialty was rich old ladies.

Paul Moscou, who pleaded guilty before the trial was so thoroughly disreputable that even Mason's attorney declared: "When Moscou walked across the threshold ... it might just as well have been the devil himself. He spread his own personal corruption upon everyone who had the misfortune to have been in his presence."

William C. Toomey, a stout, whiter haired crook with pince-nez and a benevolent expression soothed the "squawks.'' Asked for a definition of "squawk" one Gerald S. Owens, an immaculately-dressed Oxford graduate who was a front man for the boiler-shop operators, replied: "In the literal sense it is an onomatopoeic word denoting the raucous noise emitted by a large bird when stripped of its feathers."

Silence descended on the courtroom. "But," continued the onetime Oxonian, "using the word in its stockmarket sense. I would say that it means a customer who complains that he has been swindled, and who is rather noisy about it." What was a "mooch"? A mooch, said Oxonian Owens, was a "person whose greed has temporarily overwhelmed his judgment."

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