New-York tribune., 1872-09-19
THE TREASURY DEFALCATIORS.

ALLEGED DEFAULT OF OVER $lOO,O0O-RETI-
CENcE AND PREvARICATIoN OF THE GOV
ERNMENT OFFICIALS.
For several days past rumors of a large de-
facaton in the subTreasury OF this city have been rife
in official circles. Yesterday morning the rumor became
generally known through the medium OF dispa'ch from
Washington to the following effect:
Information has been received here that In examining
the books and counting the money In the SUP leasury
ment funds has discovered This search which IL
conducted by officials sent from the treasury
spafi"GVS aSdSt two weeks, and nd it is said to be
the first thorough examination and count tt mas peen
NewYork It appears from the accounts received IL that
the defaleaOn discovered some ten days ago OF So
hope that by snppressng the information from the public
the frauds could be more completely found out AS yet
that the subTreasurer cognzan Of the fact that de-
facaton In his department has occurred that ne Is pc
but is Of course responsible for the acts aud pecuatOns
of his subordinates; that during the past rev
days he has repeatedly called his bondsnen 70 ms pres
ence and the matter has been discussed privately by
them Just how great the defacation Is has not YET
the positions occupied by the alleged guilty parties
have yet definitely been ascertaned although so'eIa
names are mentioned
Early yesterday morning TRIBUNE reporter called at
the sub-Treasury in Walls for the purpose of seeing
Gen. Hhouse, the Assistant Treasurer and ascertain
ing the exact facts. The first person encountered was
Mr. LEOPOLD, the chief Of the Examining Commission from
Washington, who investigating the accounts, and
balances of money, securities &c To him the reporter
applied for information, and told that as far as
the commission had gone they had discovered a
deficit of sl1, which insignificant sum was
probably due TO clerical errors. They had
examined SIS OOOOOO ont OF SCI 3s3759 9s gold with the
above result This however criterion that every
thing was right it not until the accounts OF the
subTreasury were compared with those Of the Depart
Inent at Washington that they could certify to
the actual correctness Of everything Mr.. LEOPOLD was
then asked whether he had any information OF mures
sion definite or indefinite regarding the alleged defaca
tion but he replied that he had no knowledge or sus
picion Of any such defalcation
stin unsatisfed the reporter sought Gen. HihOuse,
who was coseted with Henry Clews Another attempt
was later the day, hut Gen. Hilhouse was en-
gagged with exPolice Commissioner Thomas C. Acton,
Detective Sampson, and a third person. but by
dint Of patient waiting, the reporter was
at last admitted. Uuon stating his business
ess he was at once referred to Mr. scohed but decr
ing trouble that gentleman again. was Informed that
Gen Hillhouse had information TO impart, and was
very much pressed with business. The reporter
asked whether it was the intention OF
Gen. Hhouso to publish formal denial OF the charge,
and was informed by him that ne would not do
so until after the examination had been com
pleted. After considerable parrying the reporter
finally asked Gen. Hlhouse n he did not
have information concerning the defaoatlon, TO
which he evasively replied: cannot say" Upon
being asked to furnish list OF his bOndsmen, Gen. Hill
house declined alleging that he did not care 10 have
their come from MN for publication at present
All through the building the reticence prevailed,
OF the employees apparently being that there
anything wrong. and al asserting their ignorance
Later in the afternoon, second dispatch arrived from
Washington to the following effect:
WASHINGTON, Sept. ia rumOr cnrrent here last
night that deialcatOn had been discovered in the Sub
Treasurers office at NewYork, amounting to sl5O6OO or
$2O0OO0.
Upon inquiry at the Treasury Department, to-day, 1t
is aseertaned that the run0r TO certain extent Is true,
Some time during the month Of August, James John
son. who has had charge Of the stamp division
Of the suD-Treasury office since 1906, and who
was appointed under JohnsOns Administra-
tion applied for and obtained weeks leave OF alb
sence Failing to return at the expiration OF his vaca
zion, suspicion aroused that his accounts were not
in proper shape, aud the Treasury Department at once
ordered an investigation. An examination in part OF
his books revealed the fact that there apparent
deficiency OF between SlG0O00 and Sl7OOOO but whether
cannot DE ascertained until the examination Of his
books, in progress, is completed. Tie Treas
ury Department here are Informed that John
sons books are In confused condition, and tbat
some time will necessarily eapse before truth be
fully known. The department regarded johnson as a
very efficient officer, and the officers here cannot under
stand how he cOnd nave become defauter for such
Johnson has not been heard from since he left the
leave OF absence.
With copy OF this dispatch in his hand the reporter
returned to the ubTreasury aud again sought Gen.
Hillhouse, who again suggested interview with Mr.
Leopold. declining to impart any information, admit
or deny that there any defalcaton. Mr.. LEOPOLD
had left the building and one could give
any information 10 his whereabouts.
Mr.. White the cashier. would not give
any information referring the reporter to Cen Hill
house. And effort made find the stamp depart
ment wherein Johnson said have been employed
but no one could be found there
Thus at every step the efforts Of the repO rter
thwarted in his search for the facts At late hour last
evening 1t was finally discovered that James johnson,
in charge of the Internal Revenue Stamp Department
he person mentioned ia the Washin On dispatch had.
in accordance with the usual custom OF the Office Oh
tanned leave of absence for two weeks. be-
ginning ON Saturday Aug. IT, On Monday he
was seen in New-York, and Tuesday was
ported TO have left the city for Maine to enjoy
mis- vacation in fishing and shooting. From time
nothing has been heard from him. His continued alb
Rence excited suspicion, and dispatches
forwarded TO Washington requesting the De-
partment 20 send copies OF his accounts 70
SubIreasury in order that they might compared
with his books and the balance of the stamps. The
stamps on hand compared with his books and Il is
euardedly ntimated that there is deficiency amount
ing TO 100000 The actual facts relating to the
defacatOn IL stated, cannot be ascerained until
accounts have been received from Washington
johnson Is represented man very much respected
by all who know him. IL s alleged that is guilty
OF the crime, the money viii probably he
found 10 have been frittered away i'm margins
property was abstTacted in the shape OF stamps
money II In stamps, he must have had a confederate,
as no could dispose OF the stamps without exciting
suspicion.
THE HBA7HBR.
WAR DEPARTMENT