New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1869-11-13
TIE CUSTOMHOUSE.

800, 000-PROMINENT OFFICIALS IMPLICATED
ISSUE OF WARRANT FOR DEPUTY coll
LECTOR SAMUEL 7. BLATCHFORD-ENPLANA
TION AND HISTORY OF THE FRAUD5-sEIz.
URRS-CHANGES.
The interchangeable exertions of District
ATTORNEY have brought light during the last
week series OF bold drawback frauds committed three
years ago and amounting to nearly hreequarters OF
million dollars yet covered up with such skill as to re-
main yered and unsupported, until within
very few weeks The investigations have also dis
closed the startling fact that scarcely doubt remains OF
the completely in this villainy OF Deputy Collector
Samuel BatchfOrd for whose arrest warrant has been
issued Mr. BatchOrd has borne an excellent character
and stood especially high in the esteem OF Collector
Grinnell but the evidence against INN Is so strong
that his best friends are compelled TO ADMIT
that he must at best have been crimnally careless
while the District Attorney il thoroughly satisfied OF his
guilt and expects that an indictment VIII DO speedily
found against HIM probably Monday next prominent
official in the Treasury Department at Washington whose
name must be withheld for present, Is also believed
excellent evidence 10 have been fully cognzant OF
the frauds and to have shared the proceeds to ex
PLANTATION OF the OF drawback claims may enable
the general reader the better to understand the charao
ter OF these frauds and appreciate the force OF the
evidence against Blatchford InAugust 1884, law was
passed providing that when goods were exported on
which an Internal Revenue had been PAID the amount
OF that tax should be refunded to the exporter ema
goods When exported again in the original packages or
on raw materials manufactured for foreign markets.
have been in operation for 10 years. but the frauds now
under investigation have not been committed IN TINS
Tariff Drawback Bureau which has always been honestly
administered butin the Drawback Bureau oihe Internal
Revenue Department which Bureau ceased to exist IN
June 1868 To Obtain the payment Of drawback claims
through this happily extinct Bureau II was neces-
sary to obtain three documents tax certificate from
an Internal Revenue Collector showing that the tax
had been paid on the goods to be exported an aidaYit
from the exporter himself and export certificate from
the Custom House. These documents went TO the Audi
tors office at Washington, and thence TO the Unlteu
States Treasury, where the claim was paid When VIII
liam H. whimser. an advenurer from the oil regions OF
Pennsylvania conceived in the Fall OF 1866 the idea OF
syipdlng the Government by means Of fraudulent draw
backs he and his confedeates found no trouble In OBJ
tanning a many certificates they needed from the va
Internal Revenue officers In that state nor qua tne
giving OF these imply the least , ta he ami
tho collectors, who had no reason 70 ueu9' li" @ ~
cant for the certificate really intended TO export tue
goods in question. Nor did the ahiayits require any
thing save little safe and judclous perjury DeIore
convenient notary who frequently drew them up anu
then affixed fictitious signature himself OuI te eA'
mort certificates presented difficulty, for IT was
absolutely necessary 10 commit two very dangerous OI
geres every certificate, or else 10 secure h an aGco
pce no less an official than the Chief Clerk OF the Inter
nal Revenue Department Of the custom house VINO
certificate preparatory 10 It's being signed tor
the Collector by one OF ms uePutles,
"
Reisenberger ana tie obtained the aid OF three
Caldwell brothers-R. b.. John s., aud James-who had
the pOduS Operadi Of obtaining drawback claims sew
era others Of secondary Importance and VINO nave since
turned States evidence also admitted 70 the ring
but the great end was secured aud he I1uu pIaccay
contaminated when Samuel T. Biatchiord, al lAal tme
Chief Clerk OF the Internal Revenue Department con
seutcd for onetenh OF the spos % anN his initials to
the false certificates Contdng IN bhtGhIotd lnIekly,
the deputy whose duty 10 was Affixed the Collectors
ant piled their neflrious business brisky
"A
by the extraordinary Hood Of drAWbIch claims sent 10
Washington during the closing months or $780, made an
INVESTIGATION and discovered tine fraud. Instead Of
posing IT, however. DistrCtAtOrneY IerrcpOnt Is Iuy
assured that no not only pOckoted per cenage OF The
nroceeds NJ the prce OF his silence but shrewdly pre-
tended 10 think something wrong, ana sent on yhs'
oaiB FOR investigation skllfuy alayiug by this public
movement alI outside suspicion When Blatchiord be-
Deputy COlcctor. and was succeeded n the Ihei
Cershp by Charles j. Therott, the latter was assured
that 10 all right, and was actually Induced n ne
FOR the trivial sum OF i40 To- do IN 1901 an mat
Whmster and the CaldWells desired Inc AOolllon OF
the whole Internal Revenue drawback system put stop
to the frauds AID me eonspraigs d9aoIs ,
through the rcachery OF some Of the subordinate 80
mucH vas uscoNulou o. tny .' ,, t,o,f
Therlott, who now under touo Dbl tAdl lhu,t'nt
were found last July against him. Nhlnster ana some
Others
And now comes the history Of the late developments
preparing try these which had been turned
ney Perrepont made the starting discovery 'hAth W.
large number OF drawback frauds had been committed
just previous 70 those ne was lhNessiga,ns anu "9o
came % the conclusion tAt ~ least oho II hot po
iueut officials In the CustOmHOuse must be implicated
careful examination OF the signatures ntdccd 70 Tue eA
port certificates all OF which deposited vouchers
In the Treasury Department at Washington where the
claims were paid. Aprvate etter was HccordlIEy son'
20 Washington about two weeks ago by special nessen
ger ana after considerable delay more than 100 papers
relating the frauds found and brought TO tins
city Tuesday by George A. Mercer Of the Treasury
Department The DlstrlCtAttOTuey, aided by the Col
lectOr aud his assistants carefully compared the ceiuu
Gates signed by Mr. Atchford with the manests on file
In the CustOmHOusc and asceraned beyond any reason
able doubt such goods set forn ia Hose oe
hdcdtos shipped from ms pot| Much OF the
fraud related 10 refined petroleum, land many
OF the tax certificates were obtained
from Pennsylvania. Sui further investigation showed
that many OF these had been changed IN amount by
erasure aud rcwrugSu one case, having been raised
IN this $500 10 also discovered that the OK
The names OF the ships dates OF sailing, and ports OF
destination concerned. but that 10 such goods rs
represented had been exported In the vessels IN question
These false certificates than leo IN number aud
red ink, and signed trih ms tHais under 1e stamp IN
addition all this load OF evidence the TACT mat MT
found even by the officers IN pursuit OF hnls MOI cAacy
calculated reassurc those who entertain lingering
hope that after all he may not be guilty.
Mulligau and Campbell, who are among those charged
amined yesterday, before Commissioner Osborn but
owing 20 the absence OF the DsictAtt0rneY the case
was adjourned until II o'clock to-day. It's only just 10
say that Mr. PerrepOut inclnes 10 the belief that Null
gan was merely tool IN the hands OF tho other con
spirators, aud had no share IN their il!gotten gains
james Caldwell Is also under arrest but MS two DOtLtt
have succeeded IN keeping themselves out oi sishI
The following changes are reported ln'the custom
House:
erlck. Temporary lnspectOr-E. &. Dixon. Night In
spectors-J H. Alien vice John walker removed; Sam
ue Mnnes John De Cordy Charles Ihayer, vice j.
Mcnieo Of Rondout has resigned the oce OF Inspector
Of Customs.