The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1878-02-19


neglected to stamp the bonds when first
funded, or their stamps were afterwards
erased. Summing up the improper fund
ing, the committee find the bonds brought
in and funded after they had been ex-
changed were as follows
By E. o. Noting & Co., Richmond.........S 1000
| By r. II. Maury & Co.. RichmOnd....-.. $500
BY j. c. Williams. cashier. 1000
BY J.. NJ. Price, cashier. 1000
BY Joseph Hurst, cashier. ............ 500
| BY Charles E. Applehy, cashier. ........... 500
! Commissioners sinking fund..... 500
$11,5O0
or the bonds funded twice the second fund
by Joseph Mayo, Jr;, Treasurer. 1900
BY j. NJ. Price, Richmond. 1000
BY +. H. Maury & Co........... 1000 =, . ooo
s3o,5oo
In this sum is included the one third con-
sidered as West yirginia's part. The num-
bers OF the old bonds thus double funded,
which were on the leaves cut out, were sup
piled by the persons for whom they were
| funded. It appears that bonds amounting
to the sum of $4,000, in addition to the
I.abore, were entered on leaf cut out, but
the person for whom they were funde4 had
not kept the numbers, and therefore it
could not be ascertained whether they had
been brought back and funded second
| time.
The committee
CANNOT SAY THE STATE HAS BEEN DEFRAUDED
as regards these. 1t also appears that the
numbers OF five bonds for $1,000 each,
funded November 4, 1871, were changed by
some person ON the day-book kept by one
| OF the clerks in the Second Auditors Office
after he left the office. The bonds CORE
spending to the numbers as they now ap-
pear are not found in the Treasury, and are
probably stolen. The numbers are 1921,
9,O13, 9,SO6. 1,796, and 1850. The commit
tee have earnestly endeavored to ascertain
whether this is the extent Of the loss to the
Commonwealth by reason Of the thefts thus
brought to our attention, and have con-
cluded that there is no satisfactory evidence
that these thefts of bonds have exceeded the
amount stated. 1t is true that Mr.. W. n.
Newman, the bond clerk in the Treas
urer's Office, said that he suspected
frauds to an unlimited amount had
been practiced on the State, and he
gave as his reason the disappearance OF the
coupon register from that Office and the
confused condition of the coupon bonds
stored away Ill that Office after being fund
ed. But upon cross-eXamination he testi-
| fies CT have no evidence Of these unlim-
| tied frauds, hut merely suspicious upon the
| grounds I have indicated. The notes OF
| suspicion or supposition that have alluded
| to (as having been made on the Treasurers
| book) I have in almost every instance traced
| to clerical errors"
| 1t is possible, and indeed probable, that
COUPONS HAVE BEEN STOLEN
and used improperly; but as much more
than two thirds of the public debt has been
| nf iOtprpSt
| have been made on the unfunded debt since
the war, ample opportunity has been afford
ed for detecting any further loss in the
bonds themselves. We were particular, N
our examination, to ask for evidence Of the
fact that greater loss had accrued to the
State than reported by the Second Auditor,
and we found none in which reliance could
be placed. Mr.. Morrison, the clerk in the Sec
ond Auditors office whose duty it was to test
| the accuracy Of the books used in funding,
testified that he was satisfied that there are
no other instances Of funding besides those
referred to by the Second Auditor and his
| first clerk, Mr.. Shackelford: and this was
his conclusion after having carefully eX-
| amined the books. It is but proper to add
that upon the occupation OF Richmond by
the United States troops in April, 1865, the
| coupon bonds in the Treasury were burned,
wards the offices Of both Second Auditor
and Treasurer were occupied by troops.
None OF the bonds exchangeable under the
act OF 1856 seem to have been brought IN
for exchange after that date; and it is prob
able that the abstraction of the bonds eX-
changed under that act was made at or be-
fore the date OF the said occupation. (See
deposition OF W. n. Newman, page 32.)
II coupons have been
STOLEN FROM THE TREAsURER's OFFICE,
they were doubtless used at once. and have
found their way again into the Treasury.
The testimony OF Mr.. Newman (pp. 26, "a,
35) and Of General Rogers (p. 65), render
it quite certain that thefts OF coupons have
been and may still be perpetrated, but we
have no means Of estimating what they
may have been.
The improper funding under investiga-
tion has been rendered possible by the fail
ure to examine the registers in the offices OF
the Second Auditor and Treasurer when
bonds are brought in to be funded. 1t
never seems to have been the habit to do
this in these Offices. In the office OF Second
Auditor the cancellation required where
bond was exchanged or funded was relied
on to protect them from imposition, and if
bond was presented clean on Its face 1t
was funded without examining to see Whe-
ther it had been once exchanged or funded
before.
During the year 1871 they were under
great pressure, executing the funding bill,
and were more liable to mistakes.
In the Office Of the Treasurer it was not
the habit to look beyond the warrant OF the
Second Auditor, which has been deemed
sufficient authority for issuing new bonds,
without even testing the accuracy OF the
Second Auditor or Of comparing the war
rant with the old bonds attached to it. (See
testimony OF Mr. Newman, p. 27, and OF
Mr.. Hunter, p. 22.) Not only was there
often neglect to test the accuracy of the
Second Auditors calculations by counting
the bonds at the time, but the cancellation
required in the Treasury Office was often
postponed for considerable time. (See depo-
sition Of J. 81. Eustace, PIP. 39-40.) 4..
IT is due to the present incumbents to say
that since the defalcation Of W. D. Cole
man, discovered in 1874, they have punched
in both offices the bonds which have been
brought in-a precaution not required by
law; and since .
TIE DISCOVERY OF THE DOUBLE FUNDING
in the Second Auditors Office the registers
are examined when bonds are brought in:
to be funded or exchanged.
Mr.. Joseph Mayo was notified OF our in
yestigation and OF the importance of his
presence. e "a zs55 :5 s ~
). He ereplied that it was physically impossi-.