James Aratoon Malcolm

James Aratoon Malcolm, born 11 November 1866 in Bushire on the Persian Gulf, was a British-Iranian Armenian financier, company promoter, arms dealer and journalist. He was granted a British Certificate of Naturalization on 7 September 1907, which cited his name as "James Aratoon Malcolm Bagration" and his address as the Hotel Russell, Russell Square, London. He died in London on 18 July 1952.

In early 1916, he was appointed by George V of Armenia as one of the five members of the Armenian National Delegation to lead negotiations during and after the war, and the effective representative in London (the other four members were all based in Paris).

He was Chairman of the Royal Thames Yacht Club, and a founder in 1894 of the British Empire League. In 1907 he was co-founder of the Veterans Club at Hand Court, High Holborn. The club`s title was later changed to the Allenby Services Club and later to the Victory Ex-Services Club. In 1952 this club (of which he was honorary treasurer) had premises at 73-79 Seymour Street, Marble Arch and had over 18,600 members. He was also a co-founder of the United Services Corps. He was awarded an OBE in 1948. In 1929 the King of the Belgians had conferred on him the Order of Leopold, for his services to the Allies during the First World War.

Sir Herbert Samuel referred to him as “The actual initiator of the Balfour Declaration”, in the British Palestine Mandate.

Early life

He was the son of Aratoon Malcolm, of Bushehr in Qajar Persia, whose family had lived in Persia "since before Elizabethan days", in shipping and commerce, having acted as treasurers to British Missions to the Shah of Persia. They had numerous contacts with significant financial families in the region such as that of David Sassoon.

He came to England at the age of 13 years old in 1881, for his education, under the guardianship of Albert Sassoon. As a boy he was friends with Albert Goldsmid. He was educated at the private Herne House School in Margate, Kent, before attending Balliol College, Oxford between 1886-9.

Journalism

After leaving university, he published a political-financial newspaper in London. This was titled "The Financial Standard and Imperial Post". An action for libel arising from what his newspaper had published regarding "the Barker case" resulted in a verdict against him, with damages set at £2000. That then led to his being adjudicated bankrupt on 29 March 1893. He later became one of the founders and editors of the Hayastan Daily during the Armenian resistance during the Armenian Genocide.

Company Promoting

His earliest activities in the field of company promoting did not go well. In May 1896, with two friends (Arthur Watling and Foster Grave) he formed the "Diggers Venture Syndicate Limited". With authorized capital of a modest £9000 the intention was that this company should provide the pathway to bigger things. It would buy options over assets (and some actual assets) to be sold at a profit into larger newly created companies, with these obtaining the payment money from the general public by publishing well-advertised and suitably persuasive prospectuses.

The first such public prospectus offer was that for the "Globe Venture Syndicate Limited" in 1897. That prospectus stated that this company had acquired from the Diggers Venture Syndicate a "treaty" by which the chiefs of a group of tribes in the Suss region of North-Western Africa (around the Noun River) granted a "Direct Trading Monopoly" over that area. In March 1899 a legal action was commenced by an aggrieved shareholder in the Globe Venture Syndicate (J.P. Foster) seeking a declaration that he had been induced to apply for the shares by fraudulent misrepresentation in the prospectus - particularly in regard to the "treaty". In April 1890 the Chancery Court found in Foster`s favour and awarded him £2000 damages plus costs. In June 1900 a winding-up order was made against the Globe Venture Syndicate, and that process led to a public examination of James Aratoon Malcolm as the company`s manager, and Arthur Watling as a director in February 1901. These various court processes revealed that the Diggers Venture Syndicate had never had paid-up capital higher than sixty-four pounds, that comprising 20 pounds each from the three founders plus one pound each from the four other initial subscribers required to make-up the legally-required minimum of seven for a registered company.

Prior to its implosion, the Globe Venture Syndicate Limited had been used as the vehicle for mounting two further company promotions: The Gutta Percha Corporation Limited (prospectus published December 1897); and The British Drying Company Limited (prospectus published March 1898). Both went into winding-up processes in 1900. And both of these processes involved Court hearings in which James Aratoon Malcolm`s name featured prominently. The chairman of The Gutta Percha Corporation Limited, Sir Edward Thornton, stated in court that he had taken on that post "at the invitation of Mr. Malcom". Thornton had earlier been recruited by J. A. Malcolm to chair the Globe Venture Syndicate, having been introduced to him in June 1896. In the case of the flotation of The British Drying Company, a company titled "The Joint Stock Finance Co. Ltd." played a significant role in the underwriting arrangements. The court processes revealed that this company had authorized capital of only £500, and paid-up capital of only seven pounds. Justice Kekewich, giving judgment in the Chancery Court case Foster v. British Drying Company, was reported as stating: "the real question was whether Mr. Malcolm, to whom so much reference had been made in the evidence, was the Joint Stock Finance Company Limited - and he assumed for the present purpose that Mr. Malcolm was the Joint Stock Finance Company".

James Aratoon Malcolm did not secure an annulment of his 1893 bankruptcy until 23 June 1901, a step that required the bankruptcy Court to be satisfied that his debts had been paid in full. That means that during the course of his company promoting activities referred to above it would have caused legal problems if he had been presented as being a director of any limited liability company. Also, it was important that he was not seen to be deploying into speculative pursuits funds which ought to have gone towards reducing his indebtedness. In a July 1899 Court hearing regarding The British Drying Company Limited, it was stated in sworn evidence that the "principal promoter" of that concern was A. E. Baines and: "Mr. Malcolm superintended the allotment, but at that time held no official position in the company, except that he entered into an agreement with Mr. Baines, the promoter, to find sufficient money to promote the company". In regard to The Diggers Venture Syndicate, Malcolm stated in Court that it was not he who had "taken up" 20 pounds of shares in that company, but his brother Leo (then residing in Iran) who had taken up the shares on his behalf.

On 11 December 1901, James Aratoon Malcolm was elected a director of The Electric Tramways Construction and Maintenance Company Limited. Registered in December 1886, but for many years dormant, this company was under the control of Harry John Lawson (1852-1925) who had put it into use as the parent entity for The City and North East Suburban Electric Railway (C&NESER) scheme (also known as The Wandsworth Tube scheme). During the 1902 session of Parliament, the Bill promoted to obtain authorization for this scheme played an important role in the major tussle between the two principal competing visions for the future of London`s underground railway system: that of Charles Tyson Yerkes and Robert William Perks on the one hand; and that of J.P. Morgan on the other. The C&NESER scheme was at first benefitting from some support from Perks, but later shifted firmly into the Morgan camp.

In December 1906 he promoted "Pay-az-u-go Billiards (Hepton`s Patents) Limited" (with authorized capital of 35,000 pounds). This company took over a going concern (Hepton`s Automatic Patents Company, of Burbage Road, Plumstead) which was manufacturing coin-in-the-slot Billiard Tables and marketing these for use in public houses and clubs. The marketing included sponsoring competitions using the tables. James Aratoon Malcolm signed as being chairman of this company during 1907. This company appears to have been a commercial success, but was dissolved in 1915.

Arms dealing

His arms dealing career began with making the first offer to provide 1,000 sharpshooters for service in Southern Africa, and he fitted out Major Albert Gybbon Spilsbury's Tourmaline yacht for its controversial 1897 expedition to Mogador, Morocco.

Financing activities

As a contractor for public works he proposed to finance the Baku aqueduct, the longest water conduit in Europe which was ultimately financed by Zeynalabdin Taghiyev, the extensions to the London Docks, and the Canadian Trent–Severn Waterway. He was chairman and managing director of the British company "The Improved Construction Company Ltd." which had the contract to supply the 110 miles of concrete pipes for the Baku aqueduct project.

In 1912 he negotiated on behalf of the Chinese government the £5 million Crisp loan led by Charles Birch Crisp to the new Republic of China.

He was the Secretary of the "Montreal Ottawa and Georgian Bay Canal (British Claims) Trust" which was registered as a British limited liability company on 21 April 1928.

Publications

• Partition of Palestine. Suggested alterations in proposed frontiers (Mar 1938), Apollo Press, London
• Origins of the Balfour Declaration: Dr. Weizmann's Contribution (1944), British Museum
• "An Armenian`s Cry for Armenia", Nineteenth Century, Volume 28, Issue 164 (October 1890), pp.640-647

Further reading

• Halabian, Martin H. (1962), The Zionism of James A. Malcolm, Armenian patriot, MSc Other Thesis, Brandeis University, Dept. of Near Eastern and Judaic Studies