New-York tribune., 1874-03-26
WASHINGTON.

OBTAINED INFORMATION REGARDING Lh1AOh
AND SUCCESSION TAXEs-soLcroR bANfihLo
MAKES A BAD RECORD FOR HIMSELF AND ihh
TREASURY DEPARTMENT - IMPORTANT PAPERs
srIIL WITHHELD by SECRETARY RICHARDSON
sANBORN REFUSES TO MAKE HIS PROMISED
STATEMENT.
IBY TELEGRAPH TO THE TRIBuSE.l
WASHINGTON March % This was bad day Tor
che Treasury officers and not particularly agreeable
.oNr John d. Sanborn and his eminent counsel. 1t
has been thought that the investigation by the
Wavs and Means Committee into the Sanborn con-
tract business was near its end, but the develop
,oents tOday were Of such q character that the
promise is fair for long inquiry To-day has been
also rather unfavorable for volunteer witnesses Mr.
BonGed Solicitor of the Treasury. did not himself
onuteer but his chief did, and the result 10 both is
most disastrous Mr. Sanborn was also a volunteer
No membe, Of the Committee had asked to have him
called but he felt like setting himself right, and SO
asked 10 be permitted to tell all about it. No sooner
is be here, however, than be changes his mind aud
thinks that by making his statement he may crlml-
nate himself and he presents lawyer and says ne
Is acting under the instruction Of his counsel
District Attorney Bliss was the first to be heard
He spoke with his usual alertness, but hls state
ment did not help the case of SanDorn' IL was
plain from the start that Bliss had not lOst any op
portunty to turn an honest penny. lie had peeh VI
GREAT service to Sanborn and had been paid for It,
Instead of Mr.. Sanborn assisting the proper OF
fcers. as directed by the law, this proper officer"
Mr. Eliss. assisted Sanborn and received 5 per cent
for IT, Bliss said there was no law authorizing it,
nor no law preventing it. His attention was di-
rooted to that portion of the law where the assist
anceis spoken Of and he finally acknowledged that IN
come cases he had been subordinate to Sanborn This
WAS REGARDED by the Committee as exceedingly
strange as Mr. Sanborn was simply acontractor OF the
Government and not an officer, and the law OF May
g. 1872 by analogy, prevented the DistI1ct-Attorney
from assisting Sanborn. Bliss took part in cases
which related exclusively to legacy and succession
taxes. He received per cent while Sanborn re-
ceived 50 but Bliss said he would take money
whenever he could it, differing in that respect
only he said, from members of Congress. He col
eced S640 through bis office. 1t was brought out
that he received through Jayne $1,000; that he re-
ceiyes $4,000 as a regular salary from the Govern
ment, and now, in the Sanborn business
he has made $500, which, together, make
an income of S2l,9OO. Mr.. Beck said lie was
evidently getting along pretty well 1t was shown
what has been before charged-that the cases
collected through the District-Attorney at an ex-
pense to the Government of 30 per cent were matters
of record in the public Offices, and might have been
inst as well collected by the internal revenue
officers without any expense whatever Bliss
acknowledged that he did not bring suit In a
single case but that the cases were privately set
tied and the money sent TO The Secretary OF the
Treasury who sent the half back to Sanborn. 1t
was also shown that if Sanborn or his accomplces
had name of a man their lists, and had informed
the "proper officers" of the fact, the money derived
from him must be credited TO Sanborns collections,
even though no step was taken by Sanborn or
II. Iii, r1trVf farnlxy and
paid the amount of taxes due. Fifty per cent of this
went to SanbOIn, even though he did not lift a
finger.
Bliss, before he left the stand, acknowledged
that 80 per cent on legacy and succession taxes was
rather large; least he said, If he were Secretary
of the Treasury he should not feel authorized In
paying that amount The course of Sanborn was
illustrated by Bliss. The former obtained from a
man named Waddell a very large list of names from
the Surrogate's Office. He is alleged to have paid
good price for it. This list was compared with the
records ia the revenue Office and corrected, and
those whose taxes had not been paid were turned
over to Bliss and his associates All Sanborn cid TO
earn his 50 per cent less Blsss fee and that, per-
haps, of COughlin, to furnish the list, and the
money continued to roll into his pockets from the
Treasury. Bliss, during his statement, made some
reference to Judge Noah Davis, and said he was
willing to stand by the judgment Of the country on
their relative positions.
Solicitor Banfeld made very bad showing for
himself for the Treasury Department. and also for
Mr.. Richardson. Such clear and repeated viola
tiOns OF the laws had not been developed before the
Committee as he laid bare under the adroit CROSS
examination of Mr. Beck Mr.. Banfeld said that
the policy of the Treasury Department for years
has been against contracts, and he cited several
made by former Secretaries. in cases rate of
50 per cent being paid for collection. He said
the Department always refused to make contracts
unless we meaning probably the Secretary and him
self were closely and frequently pressed by nfuen-
tal persons; in a word. that it very difficult to
obtain contracts from the Department. and that all
applications were "pigeon-holed," and no attention
paid to them. This was probably what was done in
the case of the Union Pacific Railroad and Judge
Pendry, and the application of Coughlin to collect
for 5 ocr cent the same taxes the Government pays
Sanborn so per cent for collecting. All declare that
Coughliu is an expert, aud he really has done the
work for Sanborn at l2l per cent. When asked sub
,eouently what influence Sanborn brought to bear
10 obtain his contract he answered that he did not
bring any; yet the Secretary gave Sanborn con-
tract for so per cent and refused Coughin at IL
per cent This manner of letting contracts will be
still further inquired into, and the Committee
will endeavor 10 find out the reason for such
discrimination. Banfeld said the Department had
many to to make contracts of the
nature Of those with Sanborn long before the law was
passed in 1872 In 1870 the law first authorizing con-
tracts was passed. This law referred only to dere-
property in States lately in rebellion, but un-
der this law contracts sought of the nature OF
Sanborn's The day after the sct of May 8, 1872,
passed Mr. Banfeld said that Judge Kelsey of New
York who had Just gone out of Congress, appeared
at the Treasury Department and asked fol-