The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1866-12-29
The wbi.key Distillery Fraud..l

The Whisky DistiIlery Frauds,
The latest discovery of an extensive frand
in the distillaton Of whiskey, by which
the government has been cheated, came
to light by the seizure Of distillery
near the North river on Thirty-ninth street,
with capacity for the manufacture of Eve
thousand gallons day, which, at the rate
of duty imposed, wonld amount to just ten
thousand dollars per diem stolen from the gov
eminent This is but q drop in the bucket of
dstillery frauds which have been for some time
brought before the courts and the public. The
earliest startling Developments were made in
Brooklyn, partly through the vigilance of the
Assessor Of the Second Internal Revenue dis
lrict and his deputies. Thess casos ara sill in
process OF Investigation, but evidence enough
has been elected to show that Illicit dsiileries
were at work in all quarters, and under all
forms of manufacture Burning huid, so-called,.
which was simply whiskey with a slight addi-
ton Of turpentine, was made to an immense
extent and sold without paying duty, the
ostensible article being exempt from tax.
Then il has been proved chat this Illegal dist
lation, so extensively carried on, was connived
at by the inspectors OF distilories, who, though
employed by the government, are paid by the
distillers; and how many other officials mus /.
have been in completely with them may be sug
gested by the facility with whichthe whiskey
was transferred from tho secret places of it,
manufacture TO innHmarabe depots where i
was readily sold by contract at dollar and \
twenty-five cents gallon, the duiy alonr
being two dollars gallon. The law imposing
CHS duty has now been i'm force for more than
eighteen months, and as these immense frauds
have only been discovered within few week,
we can imagine what colossal fortunes hare
been made at tin expense Of The Internal Rev
enne, since July, 1865. 1t has been estimated
that in some establishments forty thousand dol
lars month profit was realized; but this was
in the more ambitious concerns, running five
or six thousand gallons day. No one knows
what has been accomplished in the thousands
Of less pretentious manufactures which
are scattered all over the city and its vicinity
tilleries, with more or less capacity to run of
spirils are said to be attached to various places
of basiness not at all liable to suspicion, such
as livery stables and other apparently inno-
cent establishments. That these things cannot
be done without the connivance of a 'ring" we
think is manifest The examinations now in
progress in Brooklyn will probably reveal the
extent to which the subordinate oficials OF the
Internal Revenue Department are implicated in
these transactions, as some of them are being
tried under serious charges.
But there can be very little difficulty in trac-
ing these stupcndous frauds to their proper
source. They are the natural result Of the
onerous and unnecessary taxation imposed
upon everything II is notorious that exor-
bitant duties always effor an inducement 10
smuggling. The facts now being developed in
our midst form no exception. Our community
h not free from the weakness which belongs 10
human nature everywhere, nor does II possess
any talisman against temptation. No vigilance
on the part of the government, therefore, can
stem the tide of fraud and perjury which ex-
cessive taxation has let loose upon society.
The people are pretty we'll convinced that
with an abundantly supplied Treasury, showing
in the financial returns of the Secretary an cx-
cess Of two hundred millions per annum above
the wants of the government, with no necessity
existing for the payment of the entire national
debt in this generation, the present rates Of tax
alton are most oppressive. This Is the substan-
tial reason why public morals have been so
seriously affected OF late, as we see by the fire.
quent conflicts between the collectors Of inter-
nal revenue and the taxpayers, leading to liti-
CATION which will probably in the end amount
to nothing, so interviewer are the cases before
the courts with intrigues and conspiracies
extensively ramifed and as yet shrouded in the
deepest mystery. The only way TO get rid of
this Generalization Ia for Congress to modify
the laws so as TO reduce taxation within pro-
per limit and abolish the income tax In toto.
They will thus remove both the temptation
and, We might almost say, the necessity which
appears to exist In tho minds Of many to COM
NIT frauds upon the government through the
agency Of the Internal Revenue laws.
INDIAN MAssAcREs IN THE TERRITORIES. The