Page:Dictionary of National Biography, Second Supplement, volume 3.djvu/722

 Early in 1897 he acquired the assets of the two companies, the London and Globe and the West Australian, and floated a new combination as the London and Globe Finance Corporation, of which he became the managing director. The new company had a capital of 2,000,000l. in 1l. shares, of which Wright received 605,000l. The names of the Marquis of Dufferin as chairman and of Lord Loch as a director were substantial assets; the shares went up to 2l., and the promotion work of the new company was very profitable. It acquired the Ivanhoe mine at Kalgoorlie from a small colonial company with a capital of 50,000l. and refloated it in London with a capital of 1,000,000l. in 5l. shares, the issue being a great success. Meanwhile (in October 1897) Wright started the British America Corporation with a capital of 1,500,000l. to acquire mining interests in British Columbia and the Yukon region. This company and the Globe became jointly interested in floating the East and West Le Roy companies, the Rossland Great Western, Kootenay, Caledonia Copper, Nickel Corporation, Loddon Valley, and other companies, the shares of each reaching substantial premiums. Wright's personal gain from these operations was 50,000l., apart from the profit obtained by his companies. In Feb. 1898 he started the Standard Exploration Company to take over the Paddington Consols, Wealth of Nations, and several other companies floated by the original undertakings, which had become unsuccessful.

Nearly all these undertakings were worked by one office (43 Lothbury), with a single staff of clerks, and were under Wright's direct control. The shares of the new London and Globe proved a popular instrument of speculation. The company constantly engaged in large market operations in shares of the companies under Wright's control, particularly the Lake View Consols. Alarming reports were occasionally spread as to the company's financial position; the Baker Street and Waterloo Railway Company, which was one of its promotions, was known to be a severe drag upon its resources. In spite, however, of evil reports, the Globe continued to pay small dividends at intervals until October 1899. During that year Lake View shares rose from 9l. to 28l. through the discovery of a rich patch of ore, the Globe making large profits in the shares. A sharp reaction soon set in, based on the knowledge that the rich find was exhausted. Wright, apparently misled as to the condition of the mine, made strenuous efforts to support the market. The results were disastrous to himself and to the company, which lost three-quarters of a million in Lake View shares in 1899. The crisis was reached on 28 Dec. 1900, when the Globe company announced its insolvency, and the Standard Exploration Company which was involved in the commitments of the Globe went also into liquidation. The disaster involved the failure of many members of the Stock Exchange, the liquidation of many subsidiary companies, including the British America Corporation, and the ruin of numerous small investors. The reports of the official receiver showed that the companies had long been on a false financial basis, the accounts having been manipulated in such a way as to conceal deficits, and the dividends paid by the Globe not having been earned but provided by means of loans from Wright and the other companies. The resources of practically all the undertakings under his control had been employed in his recent Stock Exchange operations.

In 1902 his fellow directors of the London and Globe Finance Corporation brought an action against the promoters of the Lake View syndicate for the recovery of 1,000,000l., of which they had been deprived by misrepresentation. The case was heard before Lord Alverstone, lord chief justice, in June 1902. Wright was a chief witness for the plaintiffs. After a nine days' trial, a verdict was given for the defendants.

Meanwhile Wright had been examined before the official receiver in the London and Globe liquidation, but the public prosecutor refused to institute criminal proceedings. Public indignation was aroused, and on 19 Feb. 1902 an amendment to the address was moved in the House of Commons by Mr. George Lambert expressing regret that no prosecution had been instituted against the directors. The law officers stated that in the present state of the law a prosecution could not be confidently undertaken, but Sir Edward Carson, the solicitor-general, expressed his belief that a false balance-sheet had been issued. Mr. Balfour, the leader of the House of Commons, admitted the existence of ‘deep and profound indignation’ among the public, and promised that the law should be amended. Finally, Mr. John Flower, a creditor, obtained from Mr. Justice Buckley on 11 March 1903 an order for the official receiver to prosecute, and a warrant for the arrest of Wright was issued. Wright had sailed four days before from Havre to New York, where he was arrested by warrant on