New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1883-10-10
CARROLL,S COUPON FRAUDS.
THE LOSS TO THE CITY $164,eoo.
EXPORT OF THE COMMISSIONERS OF ACCOUNTS
srBsIIruTEp COUPONS USED.

and documents, including 60,950 vouchers; oS n
ing expenditure OF upwsra OF SonSs can.
celled and exchanged for registered cerl.ncaTys'
The Commissioners say that previous 10 uhueF'atA-
lug the investigation secret exanlnatOn OF tno
canrons had heen made i'm the Controllers Office by
David L. Johnson a clerk. whose uutdes aiT N ona
nected with the payment OF coupo5ns, S or mn
the opportunity, If any were needed, 10 cover up
or destroy any evidence which might show COM
plicity on the part OF any empoye; tuc
fact that $19.S30 of coupons, found IN Carr3ii 3
oil affrr The laters DEATH was ordered cancelled
by DEPUTY Controller StorrS. they say was wrong
because had they been kept separate they mlgaC
have materially aided the investigation. In the
course of their examination the Commissioners had
occasion to refer to certain schedules Delonsng 10
the files OF the Chamberlalns Office, aud tound lhat
siXtv-sIx schedules We're missing; IN iutauot a
ouiry at the Chamberlain'S ONCE the CommlSSoheis
were informed that the schedules conIq ho III 20
found and that ii was believed tnaJ they hau peeA
taken from the files at some tune during lho
progress OF the secret Investigation. dheso
schedules it is asserted, were important, as ai0rd-
ing information of the names OF persons WHO hau
presented duplicate coupons Tor PAYMENT. go,
The Commissioners find No over-iSsues OF pohdS,
but the disposition OF large numbers o. Dlanh OOIS
and negotiable coupons printed anu Veiiso tif ~
tho Finance Department IS nOt satislac-
torly accounted for No improper payments a.S
been made Fraudulent or ex,payments OF
coupon interest have been found, begin
Ming in 1874 and ending IN 1852, amounting TO
SI64 600 and ii TO this is added loss of interest.
etc. by OveT-remtianceS 70 LOna0h OF % 22'VVV'
there is a total loss TO the city OF S3O9 699' NO in-
count during 1883. The Commissioners say tlat
persons not connected With them were employer ny
The Controller for ascertaining who committed the
robbery aud VINO shared IN the proceeds. II u
their opinion that the fraudulent payments were
accomplished through the use OF substituted cou-
pons That tAese were used is indicated Dy the
fact that some of the schedules OF pad coupons
contain the numbers aud descriptions OF coupons
which are attached 10 bonds that were cancelled
long previous the date OF such coupon payments,
and from which bonds the coupons nave not
been detached. Genuine coupons, ana noi counter
delts were used, the Commissioners DoclcVe, ana
stated. ordered and received from the American
Bank Note Company during 1871 ana lo|z, over
and above tDe amount accounted lol Dy me OOt-
froiler 2,t05 u, 900 bonds ana o.l-J +oOJ Dond5
10 cachol which was attached 2 coup9n sAcot con,
tanning sixty coupons. some with numbers printed
thereon and others without IL IS claimed by the
Deputy Controller That these surplus bonus ana
commons gere burned IN 1872 and 1873, bus The
records and les of the Controllers office present no
evidence OF this. loose pencil memOf4nI 4m has
been shown to the Commissioner NY the Deputy
Controllers evidences OF such destIuci lo Dul III con-
fans no cert tcate statement OF the destructon
and IL differs 40 detail and IN tnoaggeg3te IRON the
result obtained Dy comparison OF tle statement OF
tie American bank Nett company "a uoius P1''lv,
and delivered. They believe that these bonds and
coupons we're nct destroyed
There are four ways. il Is stated, by which the
COUPON frauds could have been perpetrated: lu
BY lhc use of coupon schedules without the PEE
scifation OF any coupons; (2l BY the repeated
audit and payment OF tue same couponsi ~ by the
improper use O. coupons cut from DolCS I"IulAcd
to tho Department b. Their owners for conversion
into registered stock; 4 oy the use Oh substituted
commons The FIRST plan implies the caToiessncss or
complicliy OF the lOuneg clerks concerned ID INC
audit and payment OK coIp9ls' "n.qA IS heeiu.u
Improbable. Under the second mfthod lne DIJAeIs
who collect the money foi the coupons must
also have been implicated tumclent
answer 10 the third method is 10 say thdt no cOu-
pons are found to be deficient ON the bonds that
have been surrendered 10Y registration. By tie
fourth method 10 possible for Carroll and john
son together perhaps for one OF them, TO accom-
pish the repeated payments. ibis IN the opinion
OF the Commissioner, was the method thaJ was
Tie remttanoos made to the London agency
from time 10 time SINCE 1877, on lUnd,, 10 meet
Coupons presented there for payment, have been
larrely m excess of the amount required for
that purpose. Inc loss Oh interest, premium on
gold, exchange, COMMISSIONS etc', 10 we Guy ~
$4,000. Only two accou MS current nave been
received from tire London s'ncy since Iof@. 1ne
first was ln 1879. and Che 0ecoid e..cc 'he De&ii-
ming OF The present IAvcs,iglu ilo system o.
PAYING coupons b.eun IN 1870 remains in practice,
excepting tuat tue coupons are no" seni TO the
Au,iltor ana Dy INN cancelled ana pasted IA books
prepared Tor tae pc pose. line Au0ltor now auult5
Inc coupons themselves and not SIMPLY the certli-
cate 81 tie as ts.aut STOCK dui pond clerk,
As heretofore. Blt even uudeg this system 1t
is possible for frauds 10 occur The
improper coupon ymel.is inc commissioners say,
winch are tue subj o5 " this iepor, were primarily
due to non performance OF duty on the part OF the
assistant stock and bona clerk, David +. Johnson.
lie failed 10 examine the schruuies properly ana 10
punch he coupons at tine time be certified their
correctness TO the Auditor aud he failed to sec thal
CARROTS books were properly KEPT, IL was
the duty OF the general bOokkeepeI, Mr.
Barrett, TO exercise sureTNs l0n and wattAInluess
over an The subordinate h0l keepers Of the de-
u9rtinerf and all its branches and bureaus This
was not DONE II was Inc duty of the Deputy Con-
troller 10 see that all subordinate Officers were
ygilant and attentive to tlclr duties; taat ali
orders were prOmOty eXecu,ed; mat the Con
trOller was daily advised of all important matters
occurring within the Deputys jurisdiction, etc.
Had duties been fully performed tne ciiy might
have been saved the plundering OF ITS treasury.
The Commissioners have no doubt OF CARROTS
guilt They say: That CaiIOli was implicated
dence consisting of his Endorsement IN
bis own name and the application 10 his own use
OF certain cheeks drawn by Hagen * Billings TO the
order OF Bennett watch checks were gwen IN
payment OF duplicate coupons Whether Bennett
and Carroll were one and the same person may be
doubted. II Carroll and Bennett we're identical the
employees Of Hagen & Billing could hardly eialled
TO discover that fact II they dld discover 1T and
did not disclose It, then The presumption is tnat
they were in completely with Carroll IN concln-
SION the Commissioners say; " The results OF tnis
investigation such as to leave no doubt that 4
radical change in the organization and methods OF
the Department Is necessary to the proper admins
tratiOn OF It's affairs"
COMMENTS ON THE REPORT
Mayor Edison was asked by reporter OF The
TRIBUNE what he proposed to do relative to the
report. lie replied: u have moi yet re2r II.
When have looked over II carefully shall be
better prepared to say what mag do'
Controller Grant sand. in reply to the various
queries: think that there is no doubt thai there
has been great deal OF Ooseness IN the methods OF
the Department. All OF these uausac liohs occurred
before came INTO Office, 50 thai Oh my personal
knowledge l can say niue. Nheh came I1to
Office intended 10 have an examination made.
but fOund that the papers necessary ior such eA-
animation were IN tn@ hands OF the Commissioners
s ot Accounts and in constant use Therefore
this could not be done. AS 10 the London interest,
il may DC that more money WAS sent ihelo tndh
was actually necessary The COUPONS OF tue @lo,-
600 600 loan are payable either here or IN London.
The amount transmitted was what was deemed
likely TO lie called f0r. The exact amount OF
course could not be determined Ii would not DO
to have coupons presented Tor payment III London
and no cash 50 meet them. The sands matter is an
Old one something that occurred during Control
Ter CounOliV's term. Ibavc not changed my opinion
aince came into the Finance Department that
soms things we're necessary 10 be done 10 Improve
its working"
"WiIl YOU make any changes in the attaches OF
the Office 2