The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1878-08-07
A FINANCIAL MYSTERY.
An 0vsrissue of 100000 on a
Pennsylvania State Loan.
WHICH ARE THE SPURIOUS BONDS ?
Disappearance of State Records and Difficulty
in Tracing the Fraud.
[BY TELEGRAPH TO THE HERALD. ]


HARRISBURG, Pa, August Q, 1873
Fer some time the Com m ,ssionors Of the Sinking
Fund aud the officers OF the Farmers and Mech anics
Bank in Philadelphia tho fiscal agency Of tho
Treasury, have been mysti1ol about ovorssue
OF bonds OF the loan OF 1853. Since the first
oil February last coupons Of that issue have been
dropping into the Treasury tor payment, concerning
the existence OF which the Sinking Fund Commits
sonsrs had no knowledge or suspicion The act Of
May 4, ls42, authorized a Ave per cent loan OF
1000, 900, with interest payable semi-aunualy
in February and August The bon0s wcre
rcdeemaolc In fifteen and twenty ave years All the
issues Of this loan were In bonds OF the denomina-
ton OF $1,000, aud were numbered from No. to No.
5000 inclusive BY tho act OF April TO- 1853,
additional loan authorized OF such
amount might be necessary to take
MP the overdue loans Of tho Commonwealth. Tho
1ro .surv books show that the whole amount Of tho
S5.0000O0 loan OF 1852 was issued and has been
redeemed, with the exception OF 500, 900 In coupon
aud $4,000 In registered bonds Tho loan
OF April 49, 1858, began at No. 5,OO1,
whore that OF 1852 left or The minutes
OF the Sinking Fund Comm ssh oners show that only
100000 OF ths loan was issued and the money paid
totne Commonwealth Nothing appears in the OIL
cfaI this loan until i've years alter
I'M 1855 when tho following Is found In the report Of
State Treasurer Magraw:-
Received from the tirard Bank account of coupon
a 81 the Gs srn nssn sss
Treasurer, aud but rocensy accounted for. s2s 600
The loan book shows no decrease OF tho old debt
and no increase OF the now to that amount The
minutes OF the Sinking Fund Commas
ssmS.r. 1883 the Comm,ssoners eanee, E a Us"
destroyed bonds numbering iron 5,5ol to $500
under the act OF April 10, 1853, which found IN
the vaults Of tho Treasury, numbered but signed
Had not the bonds IRON 540l TO 500 Inclusive been
issued they would have been found and would have
out gone. The Treasury books show that
bonds numbered from 5,0O1 to $500 issued anu
$500 900, in tho year 1853 There is no account or
minute record OF the sale OF any other amount un.
dor tho act creating this loan.
now TuK ACCOUNT STANDS
On the LIST OF February, 1875 tho amount Of coupon
bonds Of the loan OF April 10, 1853 outstanding
according 70 the Treasury books s226, 700. and
to meet the interest duo that date $3.50,
being the amount OF 226 coupons OF SIS
agency OF tho State IN PhndeIphia; but il was not
enough W to February 1873, nothing In excess
Of s5,42so 600 of the two loans had appeared for
nineteen years tho interest being regularly remitod
10 the financial agency IN Philadelphia by the Treas
ury IN Harrisburg. There was never the slightest
LIST Of Apr., 1877, it became apparen. that
tbcro was some ''irreguiarity' ia tho Issue
1878, were presented in excess Of the amount
regularly RENTED by the treasury until
sa Of sss each
had been presented 10 excess OF what tho Treasury
officials had any knowledge. Previous to July /,
1878, l42 bonds of the loan Of 1858, commencing with
No. SOL and ending with No. $500, scattered
through the series, were redeemed. Thirty-four OF
these bonds are ABOVE the 5.l28
AN OVER ISSUE or ONE HUNDRED THOUSAND DOLLARS
This goes TO prove that 500 bonds $500 ooo) OF THIS
loan we're issued though only 100000 were pa. 10
posed Of she remaining 500, DOOR The fact
$500 0OO except tho $2s 900 that turned up IN 1868
have been presented for payment Indicates thai
| the hands OF the person or persons who
fraudulentiy converted them to thor
bonds were In their hands ut least as August
1877, when the call for the loan OF 1852 was made
rms was ample notice 10 persons convorsant with
OF 1858. rhey must get tho bonus into innocent
hands lose them from tho refusal OF The Treasury
TO pay on discovery OF the fraud As the Interest
would they would longer serve as cola torals
for tho loan OF money, aud must be taken up and DIS
a cLEw FROM NEW YORK
On tho 10th OF May last the banking house OF J. &
W. Sesman, OF Now York, sent TO the Farmers
bonds (sjs,0o0), with the August coupons asIached
In the latter accompanying the bonds the scligmans
merely to examine them carefully and report
Tomorrow by wire ut our expense
Whistler they are genuine . and s regular 10 every
ask lhis Information, inasmuch as they como from
strange party In Europe" This caution was sect,
with the bonos, to the sinking Fund mm,ssoncrs.
and gave TO those officials the first alarm In 70.
gard to the loan which they wero about to redeem.
Tho bonds were returned TO the Seligmans ut their
request
NOT TO FOUND.
What Increases the difficulty IN ereaching the
solution OF Tins Treasury mystery Is the
fact that tho old Sinking Fund books, con.
tanning tho accounts prior TO 1858, inciuding
the time OF tho transaction. are missing
When those loans were Issued william Bigicr was
Governor aud Ephraiin Banks was Auditor General,
but their connection ending with signing the
bonds which were then Issued by the State.
oil course ihcrc DO suspicion OF
wrong In regard to them. John N. Bickel
Tho state Treasurer VINO negotiated tn loans OF 1852
and 1858 lives III Tine mansion on Broad greet,
Philadephia, and Is believed to DO In good circum
stances. lie has recently suffered from illness
aud whom called upor by the SINKING Fund Commis-
s,oDsr Tor nn explanation he was not In physical
con uition that would permit an interview.
TIE EXCESS NOT TO PAID.
The Sinking Fund Commissioners have decided TO
redeem the loan OF 1858 it comes In until the
amount OF 100000 IL reached Payment OF tho
excess will be Withheld until authorized by
Z an act OF tho Legislature As tho loan
Issued was Tor only $1,000 thoy DO not consider
themselves empowered 10 redeem n greater amo unit,
though the gep uneness OF all the bonds OF this
is unquestioned. There is no means VI disinguish
ing them or OF tracing them By their numbers.
Tho amount already presented In excess OF tho
Sf0U, COO Is SAP 600 Interest on this loan has
ceased, and the bonds outstanding will b. rapidly pre-
scntsd for redemption. As they ore prosecuted tho
officials Of the Treasury Will Keep close lookout for