Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1875-05-12
Smashing the Western Whisky
Ring.
How Half the Liquor Made in
the Last Five Hears Es-
capped Taxation.
Dist cries Seized Simultaneously
in {. Louis, Evansville, Chi
cagO and Milwaukee.
Immense Numbers of Revenue
Officials Implicated.


Immense Numbers of Revenue
Officials Implicated.
'Lightnfng is About to Strike"
CHICAGO, Nav 1.-THE distilleries of
this city are in possession of the Govern
ment officials, who are making inventories.
No more seizures have been made, and
there probably will be more.
A Detailed Account Of the Develop.
ments.
Special to the Cincinnati Commercial.
WASHINGTON, May 10.-The removal
of Commissioner of Internal Revenue
Douglass is no longer a mystery. He was
a victim TO his own system. The follow
ing statement, derived from the most
authoritative source, explains the recent
change in the chief of the Internal Reeve
nue. Bureau, and furnishes the reason for
the simultaneous seizures by the Govern
meEt, to-day, of some of the largest distil-
leries in the principal cities of the country.
1t is very evident that Douglass knew moth
ing of to-day's operations. The attention
Of Secretary BristOW was called early in
NLC mlulIA " lit AalA ALdl NDAkAalaAAA pr
its were put upon the market in such
quantities &C to interfere with legitimate
trade. These complaints were made by
respectable firms engaged in the liquor
trade, who found themselves unable to
compete with rival houses, on account of
the abundance of illicit whisky. This
fact explains the reason why the
Secretary of the Treasury, du-
ring the last session of Con-
gress, was opposed to any increase of the
tax on whisky. He then argued that if
the sale of illicit whisky in any consider
able quantities was possible under the old
tax, frauds upon the revenue would be in
creased if the inducement to illicit dis
tillation were made greater by an increase
Of the tax. Secretary BrissOw gave the
subject careful attention, and conferred
with Commissioner Douglass. The latter
had the fullest confidence in his system,
and maintained that under it only very
small lots Of distilled spirits could escape
the payment Of the tax. Commissioner
Douglass further maintained that illicit
whisky could only be manufactured in out
of the way places, and then smuggled into
the trade in an unusual manner. He re-
lied upon the perfection of the system Of
collection which he had originated, and
upon the integrity Of the officers in the
service. He claimed that extended
evasions Of the law could not succeed
without collision and corruption alnOnl
internal revenue officers, and especially
among gaugers and stOrekeepers.
The sequel shows that Douglass theory
was right, and his confidence in the integ-
rity of his officers has been
Misplaced.
He did not believe that his officers were
corrupted to such an extent as the COM
plants would imply. Secretary BTistOW
did not dismiss the subject from his mind.
Facts continued to reach him which con-
firmed his belief that the whisky tax was
by no means thoroughly collected. He had
reached this conclusion as long ago as the
latter part of February.
Meanwhile Commissioner Douglass, in
pursuance of the policy which be had con-
stantly advocated, issued his order direct
ing the transfer of the Supervisors Of ev-
cry district in the country. The Super
visor Of Illinois was to be sent to New
YoIk; the Supervisor Of St. Louis was or
dered to California. This order excited
the intense and successful opposition Of the
DOlAlCLduSs i EC hDANCLh45OL6 VI AlAAAADAc
and Missouri came here in person 10 work
for the revocation Of the order. As soon
as Douglass definitely stated that his be-
lief II the perfection of his system was
such that no frauds could be carried on,
and soon after the revocation Of the order
changing the Supervisors, Secretary Bris-
tow discovered that information as to the
movements of special agents Of the Inter
nal Revenue Bureau, and Of the business
transactions of that office were promptly
communicated to members Of the supposed
whisky Ring.
The members Of the Ring were
Kept Constantly Informed
of everything that could be Of any possible
interest to them. The condition Of affairs
seemed to the Secretary TO demand action
on his part. He Immediately determined
TO employ new and unsupported agencies,
to operate independently Of the Internal
Bureau, especially as it had become demon
strated that agents Of that bureau could
make no movements whatever without the
knowledge Of the parties in the Ring. Maj.
Wilson, Solicitor Of the Treasury, was di-
rected to use his secret service force for this
work.
General Bristow early called the atten-
tiOn of the President to his efforts to break
up the fraudulent practices of the Whisky
Ring, and has received throughout the
Presidents active cooperation in every
step that has been taken. 1t seems prOba-
bic that some of the special personal friends
of the President may be implicated in
these transactions. The President knew
of this and directed the investigations to
proceed, no matter where the blow might
fall. Supervisor Mcdonald, Of S.. Louis,
is an intimate personal friend Of the Pres
ident. The frauds that have been COM
mltted in st. Louis may in some way i'm
plicate him, but it is certain that the Presi-
dent has directed that the proceedings shall
proceed there as thoroughly as elsewhere,
even if some of his most trusted friends
shall fall. One astounding excuse has
Teen made for the corruption among the
revenue officials in Missouri. 1t is that a
large amount of this corruption money was
used to
Prevent the Election Of Carl Sehurz
TO the Senate. This fact is certain. The
first information that the secret service
agents obtained related to St. Louis whisky
frauds. Mr.. MyrOn Colony, Secretary Of
the Cotton Exchange of that city, and CON-
mercial editor Of the Democrat, informed
the chief editor Mr.. Fishback, of what he
knew, and through his influence, was en-
powered with q secret commission to ferret
out the frauds as special Agent Of the Trea-
sury. The development Of the whole fraud
is due TO the remarkable good judgment
and discreet energy Of Mr.. Colony. On
the 10Th of April, he sent to the Treasury
Department telegram to the effect that
| suspicious shipments had been made by
BeVis & Fraser from ST. LOuis to Savannah,
| Charleston and Wilmington. The Chief
| Clerk Of the Solicitors office was immedi
ately sent to these cities with letters &C
| crediting him to the internal revenue Off
GERS there, and was directed to make care
full examination of the shipments in ques-
ton. and, particularly, to take transcript
/ of all serial numbers of the warehouse and
tax-paid stamps. This examination re-
suited in the discovery in Charleston and
1 Savannah Of packages bearing the same
numbers, and conclusiyely showed that
! BeYis * Fraser were duplicating goods. In
the present system Of collecting internal