The News-Herald. [volume] (Hillsboro, Highland Co., Ohio) 1886-1973, 1893-01-26
THE PANAMA SCANDAL.
How tho Great Lottery Loan Was
Manipulated
The Primary Cause Of the Great Tumult
which Il Now Convalsing France
Prominent Omcials Engaged
in Sharp Practices.

-frOmLn0nt
in Sharp Practices.
For two years prior to the lottery
loan, writes the Paris correspondent OF
the London Economist, the public had
begun to manifest reluctance to in
vest more money in the scheme. In
1885 an issue of 500, 600 bonds was made,
but only 45s,802 were subscribed. In
1887 a fresh subscription Of the same
number was opened, and only 25s,ss7
were taken. The source had almost
dried up, and when money was required
again in 1883 some additional attraction
to investors was necessary.
M. de Lesseps then proposed to raise
q final great loan of 6OO,Oo0,00O francs
with lottery prizes, that sum being suf-
ficient to terminate the canal. But lot
terry loans require the authorization OF
parliament. and bill was presented to
the chamber March 1. M. de Lesseps
being, however, in immediate want of
money could not wait for the bill to
pass through the necessary stages be-
fore becoming law, and March IA
offered for public subscription 350,000
bonds of 1000 francs, without lottery
prizes, but which subscribers could ex-
change for new bonds when the lottery
loan was authorized.
OF the $50, 900 bonds offered only 49,
4s3 were taken up. The situation had
become desperate, and the undertaking
could only be saved by the passing OF
the lottery loan bill. The bill was
passed successfully by the chamber and
the senate, and became law On June 8.
The events that are to become the sub
ject of the parliamentary inquiry oc-
Cured between those dates of March 1
and June 8, 1888. Parliament had in
creased the amount of the loan from
coo, 900, 900 francs to 100, ,O00, 900, in order
that the additional 120, 1000, 900 should be
invested in rentes in trust to insure pay
ment of the lottery prizes and the re-
demption of the bonds in ninSty-nine
years, the company being only liable
for the interest.
The loan was issued in 1900, 900 bonds
at 800 francs, but only s49,24 were sub
scribed, including those taken in ex-
change, producing 305, 200, 900 francs, OF
which 254, ,O0O,0 900 were for the company
and 81 ,OOO, 900 for the trust. The costs
of the issue were enormous, and are set
down in the report drawn up by NJ.
Monchicourt, official iquidator of the
company in 1890, at 81, $50, ,7sO francs, or
over 10 per cent. Of the amount sub
scribed. OF that sum 100000 francs
is entered under the head of ''syndi-
Gates" 7,301,131 francs for the press
and 10000, ,8S2 francs for commission on
the sale of the bonds. The remaining
two millions went for the printing of
the bonds and clerical work.
The charges brought by M. Delahaye
and some opposition journals against
the deputies may be and probably are
exaggerated, but they are SO precise
and in some cases are accompanied
with details SO circumstantial as to
leave the impression that they are not
absolutely unfounded Take the story
told of the vote on the loan bill in the
chamber. The committee consisted Of
eleven members, of whom five were in
favor of the bill and five hostile. The
eleventh, it is said, pretended to be un-
decided, but went to the company and
offered his vote for 200, 900 francs. The
proposal was declined, and the deputy
then joined bank for bear operation
in Panama shares, with the intention Of
giving his casting vote against the bill.
The company, however, reflected on
learning of the bear operation in Pan
anna shares, and sent to the chamber its
emissary, who called the deputy out Of
the committee-room and offered him
100, 900 francs, which was declined.
The deputy was sent for a second
time and obtained his terms, and the
majority for the bill was obtained. But
the deputy neglected to inform his con-
federate, who continued to sell Panama
shares, and as they made sharp re-
becoming known the banker was nearly
ruined. AS he has since been quite
ruined and has absconded his name has
been given, but that Of the deputy is
not yet revealed. The sudden death of
Baron de Reinach, who was the inter-
mediary employed by the company, is
said to have occurred from a fit brought
on by the discovery that the book con-
tanning copies of his letters had been
stolen after he had destroyed all other
documents of nature to incriminate
him, as he was to have been made one
of the defendants in the prosecution.
He, however, employed well-known
financial agent, who disappeared few
months after committing large forgeries
to the prejudice of the dynamite COM
pany, and who now boasts from his
hiding place that he has in his posses
sion the check-book from which the
deputies were paid.
Case OF Usury In London.
A London Shylock recently attached