New-York tribune., 1880-10-30

.,,,, ,rroS FROM DANIEL DRAKE SMITH,
Mo Hrb; has been thrown on the various
1tt,ods Inv which the house OF W. H. grace
,,ocev ont of the insurance companies
-. +,o time he was agent for the Ohuer-
.7. a. Callao. Peru. a partial list OIL the
:, which fraud was charged Is gwen
o1so another interesting letter from 'he
p-t.;sb Consul. Daniel Drake Smith, the iae
nroside,t of the Board of Underwriters, con-
En-. fine statements published in lHr lRIB-
1>rr in regard to the Democratic candidate 1or
Mayor.
HOW CAIJ.AO GAINED ITS REPUTAIION'
SOME oy THE VESSELS THAT swELLED llF PhoF-
IT'S OF BRYCE, GRACE L Goa DishhT iADi''
BUSINESS ASSOCIATE
William r. Grace, now the Democratic cahuiua'o
Cor Navor. was the agent at Cal!ao Peru. lor the
poard of Marine Underwriters of this city from
,se5 70 1871 when he was removed on grave
cbarUes These charges, the grounds for Which
have been published in part IN lHR tribune
covered almost the entire career OF Mr.. Oraee aS
agent. The proofs, however, which have oeoh So
tar c,ven in TUE TRIBUNE relate almost Wholly 10
cases that occurred the last two or three wears III
which Mr. Grace held his commission lhS Is no'
becauSe there no " GROUNDS LOT soi'o"' VIC
s,t;fac,io,v at an earlier period in the history OF
HI
the insurance companies were moved 10 an III
.-a.,,ro,io, hecause of the rapid increase IN the
or,,+ NJ their ANNA! losses al the Calao agency
eouv rAachinc half million dollars III one year
+bev turned their attention principally TO matters
+bot were recent at the time. These were such no
+or,o,s cases of fraud az the Washington Lboey ana
tbe Mary and other cases, Ike the Onloh' lhe LII
eol, rho Great Pacific the Alaska, the Nereus' the
Granite State the Mary Ogden the klt carson the
Ellen Foster the Burns, the keeer the LHeno' the
BeIle Thaver and others Charges OF iraud were
made In all these In each one investigated IL
was alleged that the insurance companies had been
defraudcG and furthermore that the firm OF bryce.
Grace & Co. always turned up as an interested
Marty Their interest was generally III the form OF
n bottomrv or respOndentia bond issued at an ex-
tortionate rate of interest to member OF the hrn
or TO It's cashier and secured by Insurance pocles'
When a vessel returned TO port in " distress" and
had 70 be repaired at the expense OF the insurance
companes Bryce Grace 81 Co. generally FURNISHED
the supplies at prices satisfactory 10 themselves; as
"loaners of money the firm supplied the captain
with the means to pay for the supplies. ana TOOK a
b,nd at rate Of interest satisfactory 10 themselves
as Sc urity as insurance agents they insured the
vessel to secure their bond; as owners of store
shin they stored the cargo of the vessel while re-
palrs we're made, always getting satisfactory rates
for storage: and the head of the hrm, w. K. Grace
~ agent for the Underwriters took good care Of the
interests of the firm, however much the insurance
companies might suffer.
With this delightful business arrangement the
more vessels that returned to port IN distress the
more fish came TO the net of Bryce, Grace ~ Co.
OF corrse. IN many instances captains had 10 be
uald = commission and this was one OF the charges
investigated Somebody made a great deal Of
,ro,ev bnt II WAS not the Board of Underwriters
raNro of.ab
his commission. as is well known. II was not the
corerument Of Peru. either which owned the car
goss. because after much suffering 1t passed law
n rrotact itself It's claimed by the friends OF the
Democratic candidate for Mayor Of this city. who IS
repnted 70 be very rich. that he can satisfactorily
exDaln the operations of his house at Callao, and
a.so explain how 1t was that the Insurance compa-
MOS lost 40 much money at CallaO during his term
as agent and how lie came 70 be removed but no
sucl explanation has yet been made
Mr.. Grace received his appointment as
agent in 1865. 1t IS charged that
in the following year an effort was made
10 defraud the PhUuix FIRE and Marine Insurance
COMPANY ID the case of the ship Rose StandlSh,
owned ova Mr. Simpson, a wealthy nercbant, of
Boston. The Rose Standish was commanded by
Cauta.n Hutchings and had been repaired and fur
nlAned with supplies IN CailaO the money being ad-
vgDced by Bryce, Grace & Co.. who were secured
bva bottomry bond The vessel was loaded with
gusno aud sailed from Callao for Germany Oh Feb
raary TO- When only three days out
and during calm weather she sprang
a leak and returned to port. II
WIS found that the vessel was leaking five inches
hour after being brought 10 anchor IN the harhor
The cargo was taken out and there was no apparent
decrease IN the leak survey held. the vessel
condemned and sold at a nominal price and was then
,,.a.l A. a store hulk in the harbOr Of CallaO by
Prrce Grace & 60. To that vessel the provisions
and sails were transferred from the ship Mary, be-
fore the latter sailed w:h the cargo Of the Washing
ton Libbey and was lost. Efforts were
maize 10 recover from the Ph9nix Insurance
Company the difference between The price for which
the vessel was sold and the amount for which She
was insured. but he company protested against the
pa;ment until the matter could be fully lnvestl-
ga.ed by the adjuster. The report of the
ad uster was TO the effect that the yes
Sci was not made unseawOrthy by
any stress Of weather, and therefore, the claim
could not he sustained. 1t is alleged that Bryce,
Grace a. Co. then recovered the difference between
tbe prce for which the vessel sold and the face
of the bottomry bond with the interest added from
the owners of the vessel, whom the captain bound
for IA pavmeut when giving the bond. Mr.. Simpson
made single effort to collect his claim from the in
surance company. and being unsuccessful aban-
doped the attempt. Captain HutchIngs. who
rapded the Rose Standsh, was severely criticised
for as action. aud was discharged. lie afterward
vent to Peru and through the influence Of Mr.
Grace, firm secured employment
FIR. Coudert IN writing To The TRIBUNE yester-
day Ill regard TO the ship Mary, SAID that the case
,ys +r;sd m this city before jury ami decided for
the nla,ntiff for whom ". r. Grace was the agent
here In was stated yesterday that the alleged stp
ulaton on that trial. which did not involve the
rogrge al fraud was denied by the insurance com
nauies The following circular issued by the cOun-
.e of rhe COMPANIES at the time, VIII explain thus
NEW YORK, sept 30 1873.
On, ~, s,,ention has been called TO "A ad-
dressed 10 you by 3essrs COudert Brothers, relative 10