New-York tribune., 1873-03-13
CUSTOM-HOUSE ACCOUNTS.
A LOOSE WAY OF DOING AN IMMENSE BUsI-
NESS.

BONDS OF DEFAUIIlNG WAkkHOUSEmEN
NOT COLLECTED.
THE TRIBUNE Washington dispatches, yester-
day contained an nmation that large discrepancies
existed the CustomhOuse returns Of the warehouse
business and as this department that the General
Order frauds were discovered year ago the dispatch
attracted great attention and comment Reporters were
detailed TO make inquiries and establish the facts IN the
ease.
tits stated by weiuformed persons that If the Con
eress Investigating Committee which met at the Fifth
Avenue Hotel had examined into the internal workings
Of the Custom house. frauds Of such magnitude wouu
have been discovered eclipse completely the reve
General order irregularities, and that want OF
capacity, negligence. and methOdical coDcealment o
deficiencies would be revealed hardly conceivable IN inc
Custom house OF the metropolis Cases OF seizure have
occurred during the past three years ana claims hauo
fer deficiencies payment Of duties In the course o
these investigations has been demonstrated that here
Is really no system attempt made 10 keep coiIec'
accounts with warehOusemen. In theory a ware
houseman is charged at the Custom-house WIN
,he tnvoice of every article which Is stored
,n bond in his building, he giving receipt
He s supposed be credited with every permit 10 IT,
move goods But in reality entries OF invoices ana per
ns involving millions IN amount are neglected Tor SIX
months at a time. In case has the prosecution OF
bopdsmen for the failure of their principals to pay
duties resulted in a judgment for the Government;
Int whenever suit has brought against the bonds
men, II has Invariably been compromised by the pay
pent of costs TO United States ana
the suit summary stopped. There has not been case
within 10 years which not thus resulted IL IL noto
rious that the Government rarely realizes from the
.sle of unclaimed goods sent TO the saesroom from
handed warehouses the full amount Of tue duties, and
the Custom-houSe authorities have seldom II ever col
Iected the deficiency from the bondsmen. This OF
course the warehouseman without any conpens
uon for the years labor and storage and the cart
age which he s compelled pay out of his own private
means.
Numerous instances. have occurred where large de-
rpands have been made by the officials in tthe Third
Division Of the Custo-house upon warehousemen VINO
have been falsely accused OF delivering goods WITHOUT
permits. The warehousemen in many cases have pre-
ferred to pay demands rather than incur the dis
pleasure OF the Custom house officials and the public
nooriety which attends such charges while IN other
cases where copies Of the permits have been Kept 10y
the warehOusemen, who consequently ignorant AZ 10
the truth or fasty charges the amounts claimed
have been paid record Of payment mas been maze
Oh the Treasnrer's books at Washington
The two following instances cited TO show the care
,essness or connvance fraud the part OF the Gus
tom-house officials Many similar cases occur eontnu
ally, but withheld irom the public;
Rodney Mason had a bonded warehouse in 1870 at Nos
IA and BIidge-st. Goods were distracted surrepti
tousv or stolen N buk with Mason's cOnnivance, aud
taken from the building openly, without the requisite
permit while in charge Of the Customhouse ofhcer
Two hundred and fifty thousand dollars worth Of goods
were In this manner disposed Of Mason, seeing that
detection must soon occur after he had for two years
successfully carried his operations under the eye OF
the Government officer in charge finally absconded
Custom house investigation took place and efforts were
sad TO have to the amount OF the de-
feiency from bondsmen, but not one dollar has to
this day been collected.
The firm OF May Hart & Co. established bonded
warehouse in West-st. Canalst. They received
goods IN bond consisting mostly Of imported liquors and
cigars. They carried business for nearly years
time and al the expiration OF that period suddenly de-
tamped. Custom officer had been in charge during
the time Examination Of the premises showed that
the barrels had been emped Of their contents and pure
sprts substituted while the cigarboxes had been red
and blocks Of wood placed in them. The Government
lost nearly 100000 this operation, as the amount has
never been recovered from the bondsmen who were de
eIared by the CustOmbOnse authorities TO be men Of
straw"
1t is stated that the of the omission TO report
the balance due the to the Secretary of the
Treasury the years 1871 and 1872 IS twofod, namely
incapacty and ignorance Of the Customhouse ohcals
as 20 the actual amount due, and the increased amount
OF deficiencies for that period. The $A96244O due on
July l. 1870 may be substantially declared lost to the
Government being the amount due from persons de-
elared 10 be insoyent or unable be found and in
case can u be collected from the bondsmen, who are
declared 10 be irresponsible. 1t is estimated that
900 has been lost TO the Government in the ware
house branch alone during the past two years ana
half making in all over SOOOOOO lOst 10 the OoNeih
ment by Customhouse officials, whose business 1t should
be TO see that the bOndsmen responsible persons
and that deficiencies the payment OF duties are
fully and promptly collected This whole amount with
trng exceptions, might have been collected under the
direction Of vigilant and competent officials
HOW THE BUSINESS is DONE.
Mr. F. NJ Bixby an old warehOuseman, stated that
returns were made daily by him 20 the Collector Of the
goods received and Withdrawn from storage. HIS books
were kept in the manner those in bank. In no
other way could NE transact business there neg
Iect was probably owing 20 failure on the part OF the
proper officer to transmit the proper returns 70 Wash
ngton He knew from personal experience that blanks
on which 70 make these returns provided bS the
Treasury Department
"LEET AND Stockings" VIEWS
ATRIbUNE reporter called upon Messrs. Leet Co, at
No $50 Greeuw1eh-st These gentlemen bonded
bousemen and are favored 10y CustOm-house officials
with General order business formerly. From
them the reporter unable TO obtain any report
favorable to the system by which warehouse business
conducted. AS between the warehouse-man and the
(ustornhouse they say there possibility of fraud
ar of loss to the Government An officer Of the Custom
house called storekeeper is stationed IN each bonded
arebouse who makes daily returns the Collector Of
all goods received and delivered. The warehouse man
has no dealings with the CustomhOuse except TO g1ve
heavy bonds for the safe keeping OF all goods nruted TO
hun and delivery in good order on the presentation
OF a permit from the Custom-hOuse The importer on
sending goods the public store gives bonds for the
payment Of the duties, so that the Government S thus
dOubly secured by double set OF bonds
The gentlemen above named knew nothing OF the
warehouse business 70 Commissioner Of Customs at
Washington but said that there must necessarily be
counts which be closed up for years. For III
STANCE 600 cases Of goods would go bond in
invoice, aud al few cases be taken out within
6ouse wonid be returned TO the Customhouse soon
made but the latter could not make return until
delay Of years In brief, they professed 10 know OF