It appeared that while in Europe, Margery learned some of the tricks of fraudulent mediumship and upon her return to America, she resolved to develop materialization. Psychic lights signalled the first phase; ghostly fingers lit up the darkness and produced contacts; curious forms, which Walter called his psychic pet animals, were observed; and independent writing developed on a phosphorescent background. Materialized hands performed pickpocketing stunts and—as a further evolution in vocal phenomena—tunes were produced by whistling and raps.
On April 12, 1924, the widely discussed investigation of the Scientific American committee began. Scientific instruments were introduced and recorded brand new phenomena.
Despite many striking demonstrations, however, the committee came to a deadlock and the only thing approaching a verdict was a series of individual statements published in the November 1924 issue of the magazine. Hereward Carrington pronounced the mediumship genuine; Harry Houdini fraudulent; Walter Franklin Prince, William McDougall, and another fraudulent member were noncommittal.
J. Malcolm Bird, the secretary of the committee, was satisfied after 10-12 sittings that the phenomena were genuine. McDougall and Prince, however, even after further sittings, were unwilling to make a public commitment, though Prince had become convinced privately that Margery was a fraud, an opinion he would soon publish.
Another Harvard Committee also refused a final decision, and precise conclusions were absent from the report of E. J. Dingwall published in the Proceedings of the Society Psychical Research. From his sittings in January and February 1925, in Boston, Dingwall observed that "phenomena occurred hitherto unrecorded in mediumistic history … the mediumship remains one of the most remarkable in the history of psychical research," but troubled by the possibility of undetected hoaxing, he concluded that the mediumship "may be classed with those of Home, Moses and Palladino as showing the extreme difficulty of reaching finality in conclusions, notwithstanding the time and attention directed to the investigation of them."
On 30 June 1925, one of the Harvard investigators saw Crandon draw three objects from her lap. One object was an embryonic hand than the earlier one, spongy and feeling like blancmange, one resembled a baby’s hand, and the third was not described. This hand was photographed under red light. When the photographs were examined, experts from Harvard reported that the so-called ectoplasm was composed of the lung tissue of some animal.
The Society for Psychical Research wanted further investigation. A committee of three Professors, Knight Dunlap, Henry C. McComas and Robert Williams Wood were sent to Boston. Crandon had a luminous star attached to her forehead, identifying the location of her face in the dark. After a few minutes a narrow dark rod appeared over a luminous checkerboard which had been placed on the table opposite Crandon. It moved from side to side and picked up an object. As it passed in front of Wood he lightly touched it with the tip of his finger and followed it back to a point very near Crandon’s mouth.
Wood thought it probable she was holding the rod by her teeth. He took hold of the tip and very quietly pinched it. It felt like a knitting needle covered with one or two layers of soft leather. Though the committee had been warned that touching the ectoplasm could result in the illness or death of the medium, neither Crandon nor the "ectoplasm" rod gave any evidence of Wood’s actions. At the end of the sitting Wood dictated his actions to the stenographer. Upon hearing this Crandon gave a shriek and fainted. She was carried out of the room and the committee was asked to depart. Wood was never invited again.
Crandon’s "teleplasmic hand" that allegedly appeared in photographs was said to resemble sewn tracheae. Allegations were made by some conjuring historians of Houdini and medium-ship that her surgeon husband had altered her genitalia and this was where she concealed her teleplasmic hand. The "hand" did not move after its appearance on the table before her. It lay still as if it were dead and then supposedly vanished.
She refused to wear tights, and refused to be internally searched. However, proof that Crandon had been surgically altered has never been found. The ‘hand’ only appeared when Dr. Crandon sat next to his wife, Mina, and held or controlled, her right hand. There are photos of the alleged teleplasmic hand and its position on page 237. It appears to be coming from Crandon’s groin.
Finally, J. B. Rhine, Prince, and others published an attack on Margery’s mediumship. Dr. Rhine was able to observe some of her trickery in the dark when she used luminous objects. He refused to test her further, and postulated that she may have been subject to a personality disorder. Dr. Crandon defended his wife in a pamphlet Margery, Harvard, Veritas published in 1925. The controversy over Margery had become so intense within the American Society for Psychical Research that the society was split. Those who had become her detractors, including Murphy and Prince, withdrew and founded the Boston Society for Psychic Research.
Sittings and experiments continued through the late 1920s, however, and two important experimental apparatus were introduced. One, a voice-cut-out machine offered evidence that Walter’s voice was independent of the medium and sitters. The second, a glass cabinet, resembled a telephone booth and had small holes on the sides for the hands, which, together with Margery’s ankles and neck, were wired to screw eyes.
Crandon’s reputation was damaged when a fingerprint left on wax ostensibly by her channelled spirit, her deceased brother, Walter, was discovered to belong to her dentist by a member of the Boston Society for Psychical Research. Her dentist divulged that he had taught her how to make these prints. As the chances of the fingerprints of two persons being identical are said to be nil, Dudley inferred that Kerwin was "Walter." As the promised investigation by the American Society for Psychical Research continued without a definite conclusion, Prince, in Bulletin 19 (January 1933), alleged fraud, asserting, "For six years Walter has been claiming that the scores of issuing thumbprints, with a few exceptions, were his own, explaining the processes employed. In the light of the proved facts that claim is fraudulent."