Savannah morning news. [volume] (Savannah) 1868-1887, 1886-11-24
GIGANTIC CR0OKEDNESS.
TRUSTED DTREAsURER SCOOPS
IN 100000.

m. of Boston's Street Railway Com
nanies the LOser-An over Issue OF
stock Aggregsting 034,5S Given for
part of the Money Obtained-The Cash
Lost in the MselstrOm of Speculation.
RosroS, Nov. 23.--Wm. Reed, Treas
,,ror ot the South Boston Horse Railroad
company, was arrested this morning at
his home in South Boston, by Inspectors
panscom and Houghton, upon warrant
oberOing him with the embezzlement of
s35 900 of the railroads. funds. Reed con-
sessed his guilt and acknowledged the en-
hazzlement Of $3.50, 500 in cash, and an over
,ssue of 3a5 shares OF stock OF the road,
having a cash value of $34,500, making
1ba total defalcation $104,000. Reed be-
came treasurer OF the company about
eight wears ago. He had been very active
and efficient In looking after the affairs OF
the company, and had the fullest conf
dance of the Board of Directors.
THE FIRST CRooKEDNEss.
His unauthorized use OF the company's
mnds hegau. tits stated, in 1881. He In
vested heavily in Mexican Central securi-
ties at high prices, and succeeded until
faw days ago IN conpealing his Illegal
oneratiors from the other officers Of the
company. The discovery of the lrregu-
lsrities was caused by the election Of
Charles Hersey to the Presidency of the
company. That gentleman and Hon.
BENJAMIN Dean, one of the directors, be-
qan an investigation about ten days ago,
which resulted in an application for a
warrant for Reeds arrest. Reed had
heen i'll at home three or
four days, but he accompanied the Off
GERS to police headquarters. Soon after
his arrest he turned over to the directors
all his property, worth about $4,000 and
securities worth about $4,000. He also
made over his stock contracts, which he
and the directors believe will nearly if not
quite make good the full amount of his
embeZzlement.
ARRAIGNED IN COURT.
Reed was arraigned in the Municipal
Court this afternoon. He waived exami.
nation and was held in $4,000 bonds for
the grand jury, in default of which he
was committed to jail. A gentleman fa-
mjliar with the inside facts connected
with Reeds embezZlement, and who has
known him for years, said this afternoon
that it would be Impossible for some time
yet to state positively how much the loss
will be. An expert has been at work on
the company's books for week, and from
man, it would seem as if the company
has been practically ruined by Reeds de-
falcaUions. Undoubtedly its capital
stock and surplus will be wiped out en-
trely. Reed had been engaged some six
or seven years in delrauding the com
pany, and it is a matter of surprise that
his crOokedness was not discovered long
before.
HOW THE DISCOVERY CAME ABOUT.
The discovery came about in this way:
Reed had been speculating in stocks for
years and losing constantly. After losing
all the money stolen from the company
Reed put up Over-issues OF the company's
stock as collateral for margins on stocks
being carried for him. So much of the
company's paper being offered without
apparently any reason for it, as 1t was
supposed the company had money on
hand TO pay bills, aroused suspicion, and
the directors were notified. An exami-
nation was begun, and while 1t was pend
ing Reed was kept under constant sur
veillance at his residence by men hired by
the company. Reed broke down COM
pletely. He fairly cursed himself into O
severe sickness, and was unsparing in
his denunciations of his folly and crime.
BOsTON's FIRST OVER ISSUE.
1t is stated that this is the first defalca-
~ tnC ONol leSu6 VI SLOCh kUOWn In
this city. 1t is probable that when the
certificates Of stock are offered for verifi-
cation at the company's office, in about a
months time, 1t will be known just how
much stock has been over issued, and not
before. Treasurer Reed lost all his money
III STOCK speculatiOns. He was OF quiet.
Tetlrln2 disposition, moderate in his ex-
pendltures, and with no bad habits as
lar as known. Domestic troubles are
believed to bave fastened him in
MS downward career. Reed did not
own share of stock in the road. He is
sad to be largely interested in mines in
Utah' as we'll as In mining, railroad and
9ther speculative schemes in Mexico.
he Is also Treasurer of the Mexico Tele-
pnone Company, the funds of which be
asserts are in good condition. Owing to
uOuDt as to the genuineness OF the stock
Ceftlncates OF the South Boston Railroad
Uonpany, sales OF its shares were en-