The New York herald., 1875-12-22
CANAL FRAUDS.
HIS BANK ACCOUNT AND WHY HE BORROWED
SIXTY THOUSAND DOLLARS.


SIXTY THOUSAND DOLLARS.
ALBANY, Dec. q, 1875
The Canal Investigating Commission reasscmbled at
twelve O'clock when part or Mr. Thayer's testimony
taken yesterday read to him by the stenogra
pher. The examination was then resumed.
have not been able to learn the exact amount paid
for the French certificates; ! paid in Troy City Bank
checks by reference to the OF that bank in
March could learn; have not examined as to how
much paid for the Osborne certificates the 18th OF
April, 1875, l purchased Of him $25, 296; can't tell
whether they were for old work; the warrant
is dated May 20; I became possessed OF those
certificates April H. G. A. Stone became
payee OF the checks because they belonged TO the bank
took them TO the bank April IL don't know what
got for them; have account. Of them; suppose
there In the bank but with me frst
procured the certificates 18th OF April. 1878
The assignment from N L Osborne 70 @. A. Stone
and power of attorney without naming any was
read by Mr.. Magone.
Mr. Magone-Was not the name orc. A. Stone in
serted after IL was acknowledged and in your wrting'
A. Yes sir. have OF telling in dollars and
cents what paid Osborne for those certificates paid
Mr. Spinner partner of Osborne; can't tell whether
it in checks currency; think part at least.
In drafts; Mr.. Spinner the man had the
ton with whatever paid him paid him about the 18th
of April; ! am unable to say whether paid him any
than ! borrowed from the Troy City National
Bank on the face OF those certificates can't saw be-
can't tell what borrowed nor what paid for
them II was less than the face OF them; about
forty to ortyve days. interest less than the face OF
them at seven per cent; am able TO swear 1t not
sixty days; won't swear II nothfty days. cal
cuated the interest up about the LIST OF June and
was liberal in his allowance; have no memorandum
that know Of showing my profit never credited 1t to
McKie any other person. oil the profit these
tcaes kept to myself my Sad. understanding that
except as TO their being in proper form; this
class Of claims call only for my seeing that they
are In proper form knew that they subject TO
my audit in the way state took the profit these
certificates TO myself did not before the Commission
ers of the Canal Fund deny purchasing certificates,
either IN my own name in the names Of Others sub
ject 10 my audit can't say how much money the Troy
City Bank had belonging to the State on the 18th OF
April put there by and subject to my withdrawal
Mr.. Magone-We find that in March there was
$14l so7 and in April $12so ooo The balance sheet Of
the bank was shown TO witness and he read ad:-"Aprl
bank"
Recess till three p NJ
APTRR REcEss
The commission reassembed at $3.50 P. NJ, and Mr..
j. B. Pierson presented the power Of attorney given
him by Stephen @. Dermot on the 10th Of February to
prosecute his claim against the State for taking his
water power he also produced the inventory taken
when he sold his interest In the mill property his
partner Dermott
Mr.. John b Gale counsel for Dcrmott asked to pre-
sent protest against the commission investigating the
Dermott case that claim in course OF Judi
cia determination and 70 pursue 1t here would injure
the interests Of his client
the commission from pursuing its work If II was
adopted He was sure the commission would not hurt
the claim, but the commission must be allowed TO de-
tcrmine what course to pursue in its investigation
Mr.. Magone remarked that this claim was most GER
tanly wrongful one. m
Mr.. Gale-such declaration by this commission win
have the effect to damage the claim.
Mr.. Bigclow-We have testimony TO sustain what
have said and do say; STILL do not think we ought to
argue this question
After some further conversation Mr. Bigelow said
they would examine the paper and II found to be
pertinent IT would be used II the investigation affects
the interest OF Dermott II certainly was his fault and
not that OF the commission.
The matter here dropped and Mr.. Thayer took the
witness chair again.
Bank besides that which you have statedf A. The
canal tolls money; don't know how much; think i.
was one-ffth Of the receipts at West Troy my next
purchase from Osborne of his certificates through
Skinner after the 18th of May the 10th of May;
that purchase amounted 10 81, 900; negotiated the
trade skinper gave him the face Of those GER
tihcates at least he went TO the bank and got the
money; the certificates were assigned to me on the
day received from the Treasurer the $500, 600;
brought down from Troy certificates amounting TO
s79,55S 81 these were the Donnison, Osborne, Case
and French certificates, also Gales certificates
and J. b Gates tengneer draft; the reason
l took the assignment from Osborne that
had not yet money enough pay him, as
thought he had to pay borrowed money from the
amount he had received; l then sent him to Troy
get the money and he got IL afterward examined the
law and found that were not obliged TO pay bor-
rowed money; got nothing for accom-
%odating him; ,, swear that; don.
assignment on what discounted for any length Of
time got compensation; know Jerome Smith; he
Is q clerk In my Office; he took one assignment,
Burche took another and Terrl took another at the
time took that certificate really had money could
use to pay but did not know III have looked at the
law and find there was warrant for borrowing the
5000 000 did not draw up the resolution TO borrow
that sum at tho instance Of Thaddeus Davis with the
intention Of paying il over TO George Lord the
luton produced and no said IL not his hand
writing; II was directed TO be drawn by me; don't
know as ! presented II to any OF tho Commits
RiO 0f
and passed unanimously by the Commissioners OF the
Canal Fund; had adopted TO pay outstanding GER
ti1cates; 1t was to pay George Lord, with others
Mr.. Magone-Did you not have this resolution
adopted with the purpose 70 pay LordS
Mr.. Thayer-Lord spoke TO me about the matter,
and told him would do it; he did not pay me cent for
doing that; paid the money Lords certificate to
Davis; he had authority to collect Il; at the time
/ supposed there was law for it; had no
conversation with Davis until after the passage
Of the resolution; II had been the practice
TO borrow money from the sinking fund; no such
transaction has occurred since the Comptroller called
attention to its illegaty don't recoect who tho
paid from this money; Pratt or Buffalo, had
q claim; don't know how he is related to Comptroller
Hopkins.
The record was read, showing to whom the money
was paid.
Mr.. Magone-so you see you selected Lord, Denni.
son, Pratt and 0srander as the only benenciares OF
this county and did not communicate the fact 70 tho
others; you had money for them and you borrowed
money at five per cent to pay certain ones and as to
the others you purchased their claims at a discount
Is that sof A. Some paid and others did not, as
had not the money 70 pay them; the Hamil-
ton certificates did not pay because did
not have money to pay Is with; We had
money hand, current receipts from tho
business the canals but II not available for this
case the supernendcnts we're to be paid out Of the
same funds took Hamiton's certificate to the Troy
City Bank and the full amount $3S, 900, was paid I
dispensed with the engineers certificate because con-
sidered II did not require one; for the
refused 70 pay Benson's certificate.
Mr.. Magone-Did you not have then over $500 900
70 pay these drafts? A. No. sir; had to meet cur
rent expenses; OF money before the lst OF
October took Benson's certificate and secured tho
money for him, taking the interest only; had to
borrow money at that tmo 70 get along He read the
resolution adopted the nth OF August authorizing
loan OF $50, 900 to meet ordinary expenses.
BY Mr.. Magone-How much money had you on hand
at that timer A. Applicable to ordinary repairs9
Mr.. hagone-Yes, as we understand it A. cannot
say now but will learn.
Mr.. Magone-We have information that you had
$224 900 hand which could be used when the
luton TO borrow 500 600 adopted
Adjourned till tomorrow morning