St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1894-01-28


KANSAS CITY, Mo-, Jan. 27.-The
grand jury now i'll session here has for
seueral days been Investigating de-
liberate scheme to defraud the National
is known that two indictments have
been returned. and that capiases for the
arrest of the offenders are in the hands
or Marshal Stewart.
The fraud, which has caught the
banks iii several commercial centers in
the United States, was brought to light
by its Kansas City ramifications. Its
extent, rs far as traced, is between
S150,000 an ds200, 900, with all the details
not yet ascertained.
The persons against whom indict-
ments were found are j. H. Bemis and
one of his sons. both of the lumber firm
of j. ii. BemiS IL Co., of Jefferson, Tex.
Banks in Connecticut, Missouri, Ten
nessee, Kansas, Nebraska and Illinois
are known to have been defrauded, and
the full extent of the fraud is not yet
fully known. In Kansas City the Ma
tional Bank of Commerce was caught
for 100000.
The manner in which the swindle was
/ perpetrated was not complicated one.
he Jefferson City firm would draw
drafts on other business concerns
which Bemis controlled, but which it
was not known he controlled. In other
words, Bemis and his son would draw
drafts OIL themselves.
THE DRAFT WAS DRAWN
up so as to make the amount in odd
dollars and cents for the purpose of
giving it the appearance Of draft
drawn fol the sale or purchase of lum-
Der in the ordinary course of business,
and not for an accomm odatiOn draft,
which is made simply when one person
with good credit desires to indorse for
another for accommodation, and which
is almost certain to be for an amount in
round numbers. These drafts were is
sued several months ago, when the firms
had good credit, but were really in fall
ing circumstances. The next step was
to go to the banks, and, under false rep
resentationS, get the drafts caShed.
About the time the drafts came due the
firms failed. ---,s-< ss..--@-a
The fact that the drafts were time
drafts and not sight drafts prevented
attaching the bills of lading to the
drafts, as is usual i'll sight drafts, and
covered up the fraud in regard to the
Misrepresentation that the paper was
for accommodation and not for the act
ual sale of lumber.
Among the banks which got some of
;,,I INoI
Galveston and Houston. Tex. /; Memphis,
Tenn; Chicago. Atchison. Kan; St.
Louis, Omaha, and some in Connecticut
by rediScounting Western banks paper.
1t is also stated some found its way to
Boston.
George W. Howell moved here from
Atchison. He was involved as defendant
ina
CRIMINAL PROSECUTION
1 for violation of the interstate commerce
law, and was sentenced to the peni-
| tentiary. HowelPs offense consisted in
| bribing Edward Tibbits, a railway en-
1 ploye at Winthrop, Mo-. opposite At
Gibson, to make false weight entries on
freight consigned by Howell for ship
ment. Howell was found guilty, and
sentenced to the penitentiary Dec. 81.
1892. Tibbits was also convicted. Both
were pardoned by President Harrison
Just before he left Office.
When Bemls became involved two
| years ago, Howell came to Kansas City
from Atchison on the morning that re-
ports that Bemis was involved came
out, took a special train at the union
| depot, which ne had chartered by tele-
graph. and made flying trip to Tex
| arkana to lend his name to the aid of
Bemis.
I c. j. White, cashier of the National
Bank of Commerce, was reluctant to
give any information regarding the
matter to reporter.
1.-The marshal has requested me not
| to talk of this matter until the men are
arrested" he said. He consented, how
ever, to answer one or two questions.
WAS the National Bank of Com
| merce defrauded of 60.000?' was asked.
Eyes, that was the original amount,
but some has been paid back. They