# The New York Times/1921/08/25/Doctored Records In Graft Case Bare Mysterious $3,500

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Edwin Joseph O'Malley (1881-1953) in the New York Times on December 2, 1919.
Doctored Records In Graft Case Bare Mysterious $3,500.
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Chemicals Restore Erased Entries in Books of Butcher Who Got Market Permit.
$500 For The McManus.
Permit Issued by O'Malley When Adolph Kahn Visited Him After Drawing $3,000.
Swann To Aid Committee
Promises Prosecutions and Protection of Witnesses Whose Permits Are Revoked.
Adolf Kahn, a wholesale butcher in West Washington Market, admitted before the Meyer committee yesterday that he had cashed a check for $3,000 on the morning of April 11, 1921, had visited Edwin J. O'Malley, Commissioner of Public Markets, at the Municipal Building immediately thereafter, and had walked out of his office with a valuable permit for trading in West Washington Market. Mr. Kahn on the same day made out a check for $500 in favor of Thomas J. (The) McManus, the Tammany politician and leader of the Fifth Assembly District. Mr. Kahn said, however, that he "thought better" of this and did not issue the check with the name of McManus on it. Instead, he made out a check for $500 payable to bearer and it was duly cashed by the bearer. Just what the $3,000 cash and the $500 check were used for was the subject of a good deal of contradiction. Facts tending to explain the transaction were drawn from reluctant witnesses, from erased and rewritten checks and from pages of Mr. Kahn's books the writing on which had been obliterated with chemicals.
Drew Check to "Surprise" McManus.
Mr. Kahn issued a statement to the press explaining that he had originally drawn the check for McManus in order to "surprise" him. Then he changed his mind and gave Mr. McManus not a single cent. He said he cashed the check himself on the same day, April 11, and bet the money even that Jack Dempsey would defeat Georges Carpentier. He testified that the $3,000 in cash which he drew a few minutes before calling on Commissioner O'Malley had been turned over at the bank as a loan to his brother-in-law. An erased entry in Mr. Kahn's books, later restored with chemicals by the Meyer committee, showed that he had originally credited the $3,500 to his investment in the West Washington Market property, which he acquired by permit from Commissioner O'Malley. The whole page recording his expenses in connection with this transaction had been washed with ink-bleaching chemicals. A new investment account had been written up on another page. This account did not contain any reference to the $3,000 in cash or the $500 bearer check. But on another page the $3,500 was succinctly recorded as withdrawn from capital." Nearly the whole day was consumed with an intensely interesting development of the mysterious Kahn-O'Malley-McManus transaction; of the manner in which Kahn originally heard that an applicant for a market permit should see McManus; of his quick migration from the bank to Commissioner O'Malley's office; of the number of telephone calls sent out by Kahn on the Saturday he received his subpoena to appear before a Meyer subcommittee; of his consultations and attempted consultations with legal and political advisers, relatives, friends, employees and an expert accountant; of his orders and countermanded orders to his employees; of a gathering on Sunday at his office where his books were kept, and of his appearance on Monday before the Meyer committee with books erased, chemically treated and revised."
To Trail That $3,000 Today.
Today's session will be devoted to an Investigation of the real destination of the $3,000. The facts already developed are regarded by counsel for the committee as pretty conclusive as to the recipient of the $500 check to bearer. "Who got the $3,000 in cash?" To this question the committee will attempt to find an answer today. More definite evidence than is usually obtainable in bribery transaction is said to be forthcoming tomorrow, involving a member of Mayor Hylan's official family. The committee took prompt action to protect the witnesses - Christian Haslob and Stephen Woolsey - whose permits to do business in Washington Market were revoked by Commissioner O'Malley after they had testified to the payment of bribes demanded of them as the price of permission to do business under Commissioner O'Malley. The committee engaged Cyrus R. Miller, a lawyer of 261 Broadway, to fight any overt steps taken by Commissioner O'Malley against these men. O'Malley caused them to be notified that their permits would be revoked, but he took no steps to dispossess them. An application for an injunction will be made, according to Leonard A. Wallstein of counsel for the committee, as the first step to prevent dispossession. Swann to Support Committee. District Attorney Edward Swann assured the committee that he would give Dom full support, both in prosecuting crime brought to light by the committee and in crushing attempts to interfere with the committee's work. "I deem it to be of greater importance," said Mr. Swan, in a letter to the committee to drive from the public service any public official who has been guilty of exacting tribute from a citizen, or receiving compensation for the performance of an official duty imposed upon him by law, than to prosecute the victims of his greed." Elon R. Brown, chief counsel for the committee, announced that District Attorney Swann had agreed that certificates of immunity signed by himself and by the committee should be issued to witnesses who to the truth about attempts of public officials to blackmail them. Mr. Kahn's testimony cast a curious sidelight on the general policy of Commissioner O'Malley. In his testimony on Tuesday, Mr. O'Malley had explained that one of his cardinal principles was to discriminate in issuing permits in favor of merchants who dealt directly with the farmers, and against middlemen who dealt with packers. He justified the large discretionary powers held by the Commissioner on the ground that a wise administration of the office would help to reduce the cost of living. Mayor Hylan in his testimony called particular attention to this matter. He praised Mr. O'Malley's department on the ground that it was bringing foodstuffs closer to the people."
Testify Kahn Is a Middleman.
The testimony yesterday showed, however, that Kahn was a middleman. He said that he bought all his meat from the packers. Despite that fact, after Kahn had reduced his bank account by $3,500. he obtained the Washington Market concession. In fact, he got the concession away from Frederick E. Menke, an earlier applicant for it. Menke buys directly from farmers and cattle raisers. Menke was not only the earlier applicant for the permit and a direct dealer with the farmers, but he had already closed the bargain with the holder of the permit for the purchase of his business. when he was suddenly sidetracked and the permit issued to Kahn. The permit had belonged to the estate of Albert Kloblein. Menke agreed with the heirs to pay $8,000 for it. But the heirs, by some process not yet developed, were induced to cancel this bargain and agree to sell to Kahn for $8,000. Their agreement with Kahn was only verbal. When their permit had been canceled and reissued to Kahn he became the master of the situation. Kahn related with considerable humor how he had taken advantage of the absence of a written agreement to reduce the agreed on price from $8,000 1ɔ $6,250 to the Kloblein heirs. This was a reduction of $1,750, which is exactly one-half of the mysterious $3,500, which Kahn first listed in his books as an investment expense and later as a capital withdrawal. In other words. Kahn made the seller, much against his will, absorb one-half of the expense." …