Customers on Tack

A peculiar appeal to people with an itch for quick money has the stock of Atlas Tack Corp., a little Fairhaven, Mass, concern whose volatile shares are listed on the New York Stock Exchange. Four years ago, by high-powered manipulation which attracted the attention of New York's Attorney General and later drew Federal mail fraud indictments. Atlas Tack was crow-barred from about $2 to $28 per share in less than a twelvemonth. That rousing performance was almost duplicated in 1935, the stock rising in less than four months from around $9 to above $30 per share. And this time the Securities & Exchange Commission undertook a study of Tack's odd behavior, with particular reference to the big brokerage house of W. E. Hutton & Co. which it suspects of manipulating the stock through the purchases and sales its clients were advised to make.

By last week, SEC had got to the point in its Washington hearing of parading priests, housewives, and the manager of Harvard's Fly Club, all Hutton customers, to tell how they had made and lost money in Tack. Fly Clubber James Corcoran dealt from Boston with W. E. Hutton II, wiring him on one occasion: "I am sitting on 700 tacks. Where do I get off?" Partner Hutton got him off 600 Tacks at a profit of $2,400. The other customers questioned were those of Jerry McCarthy, a customers' man in Hutton's Detroit office.

Young Bill Hutton was also in the Detroit office but the powerhouse there was Jerry McCarthy, whose clientele included a good representation in the Detroit Tigers. Last month SEC summoned Manager Mickey Cochrane to describe how he bought 1,000 shares of Tack, but the famed catcher had evidently found the game too fast to follow. Asked where he had been in November 1935, he said he thought he had been in Wyoming but that might have been in October. "I travel around so much I don't know where I am half the time," he apologized. "I am here but I don't know what it's all about and I'd rather be back of the plate. You know what to look for back there. This is something new to me."

Disillusioned also was Del Baker, the Tigers' coach, who last week testified that Jerry McCarthy had bought 400 shares of Tack for a discretionary Baker account at $25 per share. But while the customers' man sold his sisters' Tack holdings at a profit, he failed to do as much for Del Baker. Through friends of Mickey Cochrane, Jerry McCarthy got another Tack customer in the person of a Mrs. Kathryn Smith, who bought 100 shares at $17.75 per share, saw it go up, finally got rid of it at $16.50 because she "didn't want to have it around." A sprightly witness was Mrs. Smith last week.

Q. You are a housewife?

A. Well, I certainly don't like that word for it.

Q. What did McCarthy tell you about the stock that made you buy it?

A. He said if it didn't go to $50 I could kick his head around for a football.

Q. What did McCarthy advise you to do when you wanted to sell it at around $22?

A. He told me to sit on it.

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