The New York herald., 1877-10-28
PHILADELPHIA's DEFALCATION.
Ex-PREsIDENr MoRroNs srATEMENr-How
FUNDS OF THE RAILROAD COMPANY WE'RE
STOLEN.

FUNDS OF THE RAILROAD COMPANY WERE
STOLEN.
PHILADELPHIA. Oct 81, 1871
In the hearing before the Register In Bankruptcy
to-day In the case Of John r. Magic Il Co. John s.
Morton was examined His testimony showed how
Huhn, the secretary under his presidency Of the Mar
ket Street Railroad Company, took advantage OF nta
knowledge of Morton's forged overssue of stock to
do q lttlo emoezzlcment his own account Mr..
Morton's testimony was as foows:-
was President OF the West Philadelphia Ia Passenger
Railway Company from August, 1868. 10 September.
1877 my presidency ceased on the 22d Of September
by resignation; resgnas,on was presented 10 Mr.
Baugh, OF the directors, and advised that II
was accepted on y Monday the 2a.h; performed Ii:
OF Directors usually took Il for granted that what
did tor the company was correct; cannot say that II
correct 10 say that II almost always was; Mr.. HuhT
was the treasurer OF the company; ! think he wa
elected In 1885, and he continued until Monday, th(
oath Of September; believe he offered to resign but
the Board would not accept his resignatior, so am
informed; while he was treasurer Of the company
ne also q member OF tho hrm Of John r. Nage
Il Co.; the lrst time discovered indebtedpess
OF that arm 10 tho company was in 1871; said at
escaped my mind az the tme; found the balances OF
tho company very low, and the examination which
taken for the Hrn about 0OO he stated to me at
the time that II was for the nrm; II resulted in the
Arm Arm executing Judgment mote ,1s for she COMPANY 70
it the time, he acknowledged that he received
the money; that judgment was tho nrst recognition
that had OF the money thus taken by Mr.. Helm;
this money taken In different sums, but Il
amounted TO $50 600 when arst made discovery;
be the amount stated after the moss careful cxsmi
nation could make ana by the acknowledgment OF
the parties; think obtained the judgment noto
from them the day made the discovery, aud not
aware that the money had been taken before that;
had suspicion that it had been taken; Mr. Ssrkos
the only other one, think, wno had any knowl-
edge OF 1t at that time, besides Mr. Nage, HUM aud
myself there was no entry made OF this Judgment on
sruc,eS the secretary 70 take box IN one OF ,hs n
pancs think the Fidelity, and kept It there can.
not say whether ne took The box IN his name or
secretary Of the company he took the box
he told me, and The rental paid every year;
did communicate 10 the directors OF the company
any OF the facts in regard to this judgment note; as
far as l know, the note the $4,000 never ap-
peared In the accounts OF the company; both Mr.
Magic and Mr. Hubn promised me faithfully thai il
did report the fact 10 the $40 900 to tho
Board they would never take another dollar without
my knowledge, and they further assured oi their
1873 Mr.. Naglo and Mr.. HUM called on for imam
cia asssanoe they said that unless they got they
taken sos 500 in addition 10 The $50 900; during this
interval had frequent interviews both with Mr.
HUM and Mr.. Naale on ihe subject of collecting the
$50 600 but on eacn occasion they put mo OF and
couraged me by saying that they would soon bo able
to pay IL; | took no steps to enforce payment by
process OF law; in regard to the $55,50O they ex-
planned that they had used the money to enlarge
their business, and after pretty angry interview, It
judgment note Tor the additional amount
Mr.. Junkn-How did you ascertain the amount oi
this second sumY
Mr.Morton-Mostly by their own admissions, as Mr..
Huh haa matters covered up so could not get at II
accurately so had do best could; they made
no explanation other than acknowledge that they
had taken that of money! 1 can't remember
whether was taken out in checks or the cash Of the
company.
Mr.. Junkn--How could that sum be taken from tho
funds OF the company without your KNOWLEDGE
MT Mor.on-I cannot inteiligently answer that
question: only know the fact that was done; not
dollar OF the money was taken with my consent;
Mr. Stokes the secretary, and myself were the only
beside NagIe aud HUM who knew ~ the time Of
the second judgment note being given; trusted the
noic TO custody OF tho secretary for deposit the
the hrst and supposed he did, and yet after.
ward the nolo somehow got into my possesslon; did
not this second taking OF The money and
the receipt the directors or any Of them
Mr.. Junkin-Why notY
Mr. Morton--Because II would have resulted in an
examination OF the accounts OF the company; still
had hope they would pay the entire debt, that
could pay OF my own obi lgations which was fearful
an exam nation might prevent
Mr. Junkin--At this time were you yourself in any
way indebted 10 the company? II so, how, In what
So n, aud did the debt arlscy
Mr. Morton--I do not thin that was indebted at
that tlmc my only Tor not reporting this mat
ter 10 company not the foar Of the exposure
but IN reference to tho overissuo Of stock, which
Nsgle and HUM wero familiar with, and which was
their reason for taking the money knowing my hands
were tod; Mr.. Nage first told mo Of HIS kn1wcdge OF
my overissue OF stock In 1S7L