The sun. [volume] (New York [N.Y.]) 1833-1916, 1878-07-09
ONE or JoHY sHEnMAN,s TRICKS.
How Tie Csed His Onfcini Position TO Make
Money, hut would not Pay Any.


Money, hut would not Pay Any,
WASHINGTON, July THE most notable
feature in John Shcrmnn's connection with the
investigation into the Louisiana election has
been his anxiety to deny compacts and iransac-
lions by which he pro1ted. This is not the first
time he has done this. He has done It now in
large transaction. lie had done II before in
small transaction.
The sudden failure OF the house OF jay
Cooke X Co. found John Sherman involved in
its affairs. Many public mon were so involved.
The enterprises OF tho firm constantly needed
Legislation, to gain which tho good Offices OF
public men were valuable Tho expenditures
OF public mon constantly made them need
money to gain which the good Offices OF the
firm were valuable The transaction was inno-
cent-upon tho books Of the company. The
consideration WINS mutual. but II was not upon
the books Of the company. There were many
such arrangements. some of which have seen
the light. and some OF which have not. Ono
which has not yet seen the light concerned John
sherman.
The fall OF jay Cooke 4 Co. meant the fall OF the
First National Bank OF Washington. This bank
was simply name under which Jay Cooke Il
Co. did business with itself. AT the failure 1t
went into the hands Of n receiver. Edwin l..
Stanton. In the summer Of 1876 he mnde final
settlement. An offer in gross WIS made for NIL
the assets. real ana personal OF the bank about
sufclcnt To meet the principal OF us lapilltles'
without reckoning interest He deemed the
offer advantageous and in deposition, now on
n'o IN ,',o Dis'ri'' .our' "uro III ouSc ~" 1o''
rccited MS reasons Tor considering TINS oner IN
| the interest Of all parties concerned. 1t Is in
this deposition that John Sherman appears as n
man Sinking obligations by which he had prof
| tod An Ind bppn l,viaI thp
| stoctholdcrs of ,he bnnL undcr q, fnr,ilinr an
sa,a,, - a. Ns,t..'at pa,t. ,. t,,,., -
actmcnt ot tho National Bank law. IL ma re-
allied little-so little that Receiver Stanton
mmned this nssct among tho had d.h,s NJ Tho
u'"pou ."'' "'''' ''''''s wv '"u u'''o ~ '''O
| bankrupt corporation. lie tells why. Some
| thing wns paid in ON 500 shares representing
$50 OOO but the remaining A. 500 shares were
$1,000 ,,,, ~ ~, , 80, 49, 80 " I,
nearly all In the hands oil bankrupt members OF
II bankrupt frm-Jay Cooke & Co. The re-
| cciver saw no nrosncc, Of recovsri,o anvthiny
from them. The firm itself held 400 shares.
Half these shares. however. were not the prop
crty OF the firm. The receiver believed they
we're the property OF John Sherman. Whatever
else hns been charged against John Sherman.
he has never. during the las, twenty years OF
his public life. been charged with insolvency
but the receiver considered the recovery OF the
| assessment made ngainst these shares as hone
| less rs the rest of the assessments Sherman
owned the shares Shcrmnn In effect admitted
| he had received dividends upon these shrrcs.
| hut when tho transaction became unavoidable
Sherman refused 10 pay the assessment md
disclaimcd responsibility. This Is what Re-
ceivcr Stanton says;
"o,,bo 400 sboros ,bo,o sroo,ood 40 s,,rdin,
in tho name Of Jay Cooke & Co. there nrc 200
shares which stan'i on the books IN the name OF
SHrn occoriir ~; mn 1rnn, t' ,n
rightfn owner and II the stockholders liability
were enforced would cndeaVor To enforce Il
against him ns such equitable owner. But he
denies his liability claiming TINT he cnnunt be
considered 10 be n stock holder within the mean.
ing of the act Of Congress relating TO thrr as
scssment, that the stock meyer stood in his
name and wns not assigned TO him that n,
meyer voted upon H. that he was never paid
directly the dividends upon II. and exercised nc
control over the management of the bank. II
but on the other hand counsel whom he con