W.F. Rau, the new head of the Diamond Hotel in this city, emphatically denies the story published in the Medford Mail Tribune that told that paper by creditors of the defunct Rogue River Commission Company that he is implicated in fraudulent transactions concerning the company. Rau and Charles H. Schneckloth are accused of fraud and conspiracy to defraud, and the Mail Tribune published a lengthy story telling what the creditors of the concern said.
Rau recently arrived in Chico from Medford, and at first he told the Enterprise that he acquired control of the Diamon Hotel, having organized a stock company for the conduct of the hotel. When interviewed by an Enterprise reporter today regarding the Medford story, Rau said: "The story is false. I shall sue the Medford Mail Tribune for libel. An attempt is being made to blackmail me. It is all spite work. I was idle in Medford and worked for that company and was to have received a weekly wage. This has not been paid. I will go to the courts for relief and vindication."
Attorney Richard White of this city this afternoon showed the Enterprise a number of telegrams from prominent business men and officers in Medford recommending Rau in the highest terms and declaring him to be straightforward and honest in all of his dealings. These telegrams were from Sheriff August D. Singler, District Attorney E.E. Kelly, Chief of Police S.F. Hittson, James S. Campbell, real estate delaer; H.A. Hussey, merchant, M.G. Mordorf, formerly of Chico, merchant.
Rau clarifies that a business fiend is behind this whole matter, arising from the transaction wherein he disposed of the Hotel Moore. He declares it is a cold-blooded conspiracy to blacken him and to damage his credit and ruin him.
He states that he worked for a salary for the commission company in which Charles Schneckloth is president and during the few weeks he was employed he received no pay. He says if there were any fraudulent transactions they were transacted after he left the company and that he left the company when he knew is was about to become insolvent.