New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1873-11-21
STATE TREASURY MISMANAGEMENT.

DEPALCATION - THE AMOUNT OF THE DEFICIT
OVER S3OOOO0-ABusEs IN THE TREASURY DE-
PARTMENT EXPOSED AND CONDEMNED - no"
PHELPS ACCOMPLISHED HIS THEPrs
lBY TELEGRAPH TO TrB TRIBUNEl
ALBANY, Nov. 20--The report of the accountant,
| william T. Warren to Gov Dix, regarding the
State Treasury defacatiOn, has not yet been made
public II is very yolumiuous and has not received
the special attention Of the Governor, who is now
preparing his annual message. In few days, how
ever an abstract Of the document will be given to
the public. The report in full will not be published
at present but will first be submitted to the Legis-
lature. The abstract, however, will embrace the
essential points Of the document, and Will show
that the extent of the defalcatOn has not been ex
aggerated, but is fully up to the largest estimate
Even if Phelps did not steal the whole OF the
money, the fact remains that the State Treasury is
"short" TO the amount of about $SOl, 100.
Il is thought here that the report of Mr.. Warren
contains statements which will excite general atten-
ton and create a decided sensation throughout the
State There is little doubt that the facts he pre-
sents concerning the administration of the State
finances Of great Importance. lie has done
thorough work, and made full exposure OF the de-
fcienees in the Treasury. II is understood from
trustworthy informant that this report lays severe
structures upon the system by which the Treasurer
signs blank checks, leaving his clerk to fill
them ont as they may be needed, although
this is an old custom, in vogue long before
Treasurer Raines's administration began.
The clerk does this, too, upon warrant
from the Controllers Office, signed simply by the
initials of the Controllers deputy, which Mr. Warren
claims to be no warrant at all. The report also lays
bare the custom of appropriating money from the
various trust funds for the general expenses Of the
Government, depending upon the incoming taxes TO
make up the amount The counties, 1t claims,
should be Obliged to pay their taxes in season to
meet the demands of the Government, or else the
Treasury should borrow TO meet its necessities.
There are twelve trust funds IN the bank and all
but three Of these are merged in one account This
is said to be very severely criticised in the report
Then again. in the Treasurers relation TO the banks,
the receipts of day the deposits OF the next
The report urges the utter folly of such course.
The deposits of the day should be the receipts of that
day and there should be nothing left from day
to day
The most objectionable habit which Mr.. Warren
is said TO bring to light is that of the Treasurers
lOanng money TO the clerks of the department.
Sometimes $4,000 or $4,000 is employed III this
way during the MONTH and the only account OF the
transactions is kept on slips of paper in the drawer
Of the receiving clerk cashier. This afforded
PHELPS, whose word was taken from week to week
for the amount which the slips in his drawer repre-
! sented an opportunity 10 deceive, by giving the
wropg amounts so that the cash repeatedly
! balanced by the amount which his wonderful
drawer was supposed to contain, and which proved
! 10 be purely imaginary. Here was a temptation
which Phelps not proof against, and which re-
suited in his ruin. The report is said to declare
that no such blind confidence should ever be in
| dulged in by Treasury officials.
| SUN another essentially bad custom which the
report exposes is that the Treasurer and his deputy
sign blank receipts and allow the receiving clerk
to Gil them out at his pleasure. BY this plan the
Treasurer and his deputy may be utterly deceived
REGARDING the amount of money received each day,
and by sillful work the part of the clerk, the
Treasurer may be practically at his mercy. The
report reflects very severely upon the Treasury
Department that can for day endure such gross
violations of all business principles. That II
will arouse the State and the Legislature
to some early action is quito certain,
for party can, knowingly, suffer
such abuses Certain persons in official positions,
who are cognzant Of the substance of this remark
able document regard it as full of very valuable
suggestions. and say that the weak points in the
manner of doing business in the Treasurer's and
Controllers offices are exposed with great yigor
aud accuracy. but yet that Mr.. Warren exaggerates
the looseuess of the Departments system as whole.
They think that, with the correction Of one OF two
abuses the general system is complete check
upon theying operations Mr. Warren they say Is
very rigid in This views of how business should be
conducted and in the main is right but should his
views be adopted in the Treasury Department
very material change i'll the statutes would be neces
sary. He has attacked every vulnerable point, and
many of them he has shown To DO without any sup
port The trial of Phelps is to take place carly IN
December.