Eleven days after a pistol shot in Paris put an end to Ivar Kreuger's fantastic dreams of a match empire, Price, Waterhouse & Co. sat down to audit the Kreuger books. Within a month they pronounced Ivar Kreuger a crook. But until last week when Price, Waterhouse issued the final report on their world-wide investigation, no one knew precisely how good a crook or how great a swindler Ivar Kreuger really was.
Threading their way through the ledgers of a dozen holding companies, 140 operating subsidiaries and trading concerns, Price, Waterhouse traced his manipulations back to 1917. Even before that Ivar Kreuger had been at it. "The fraudulent practices assumed large proportions in 1923 and 1924," the report stated, and had reached a climax in the forgery of $100,000,000 of Italian Government bonds. During those 14 years Ivar Kreuger reported profits of more than $300,000,000, but Price, Waterhouse unearthed operating profits of only $40,000,000 including "a number of items the genuineness of which is doubtful." Thus in the booming 20's Ivar Kreuger could earn but 1½% on his capital. "Neither these earnings nor any other facts . . . lend any support to the view that Kreuger possessed ability so extraordinary as to warrant the grant to him of the freedom from control or disclosure of his actions which he enjoyed."
During this "freedom from control'' Ivar Kreuger mulcted the public of $560,000,000, gulled banks & bankers for another $164,000,000. Out of the $724,000,000 capital at his disposal he paid back to the public, in interest and "dividends," $180,000,000. In securities, monopolies and associated companies he invested $458,000,000, worth last March at market prices $207,700,000—all that remains of Kreuger's $750,000,000 dream.
Two items in the Price, Waterhouse report give the measure of Ivar Kreuger as a crook and a swindler: "Withdrawn by Ivar Kreuger on current accounts," and "Securities and other assets appropriated" —432,046,000 Swedish kroner net, at par about $115,000,000.
Kreuger was able to make off with $115,000,000, Price, Waterhouse, explained, not only because of the confidence he inspired and his autocratic powers but also because of "the loyalty or unquestioning obedience of officials who evidently were selected with great care (some for their ability, others for their weaknesses). . . ." Moralized Price, Waterhouse: "The history of this Group of Companies emphasizes anew the truth that enterprises in which complete secrecy on the part of the chief executive as to the way in which important parts of the capital are employed is, or is alleged to be, essential . . . are fundamentally unsuited for public investment."*
In Washington last week Senator Peter Norbeck, onetime South Dakota well-digger, set his Banking & Currency Committee once again to probing buying & selling practices on U. S. stock exchanges (TIME, July 4). They began by poking in the ashes of Kreuger's matchdom. Witnesses brought the Committee up to date on Kreuger history but were unable to shake Senator Reynolds's firm belief in the No. 1 Kreuger legend: that Ivar Kreuger's death was as false as his life. Lesser legends added recently to the great book of Kreuger lore: