New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-03-03
THE FRAUD At CARNEG1ES.
SECRETARY HERBERT ADMITS THE FACTS
PRINTED IN TIE TRIBUNE. BIT DENIES
THAT THE DISCOVERY HAD ANYTHING
,rC, no ,,rrtr Mp CARVEGIE'S

THAT THE DISCOVERY HAD ANYTHING
TO DO WITH Mr.. cARXEG1E's
TARIFF LETTER.
WASHINGTON. March 2-The Secretary Of the Navy
tonight made public some interesting facts hereto
fore carefully kept secret in regard 20 the arTnor
plate contracts OF the Carnegie Company Tor me
new war vessels The publication was calei ont
by Washington dispatches to The New-York TTh-
me asserting that defective or inferior armor
plates to the value Of some millions Of dollars had
been imposed upon the Government at the carnegie
works. notwithstanding the presence in the WORKS
Of an officer OF the Ordnance Bureau VINO IN
snected the plates and that the matter being dis
covered. Mr. Carnegie and his manager Mt. FLICK
were sent for 10 come to Washington last Dece1-
Der and had an interview with the President which
resulted In the imposition 81 heavy fine upon them
II was not charged that Mr. Carnegie or MI
Frick or any one in high authority al the works
was cognlzant OF the substitution OF plates IL
feror to the test plates. but It was suggested that
the substitution was made 10y some foreman or
other person having an interest in showing a
greater percentage Of excellence in his work than
the facts warranted The penalty imposed on the
Carnegie Company was % per cent on the amount
Of the contract price OF the Plates delivered
Secretary Herberts statement in regard 70 the
matter Is subjolnel The Secretary adds that The
Tribunes suggestion that the imposition Of this
fine had anything do with Mr.. Carncgie's cole
brated letter OF January 3. just previous - his
sailing for Europe. IN which H. gave qualified ap-
proval Of the Wilson blll IL entirely gratuitous
The matter. he says was entirely business trans
action between Mr. Carnegie and the Department.
and such has been closed.
Secretary Herbert's official statement Is az fol-
lows:
Early I'm September last. the Department ascer-
tanned that illegal practices we're being resorted 10
Company. Limited. at Ltts5nrg Tenn IN , ,hT
. hose ire, tIlnrif had
Some time. \ thorough Investigation was SCI on
foot at II was ascerained that while all The
armor manufactured for the Government was good
all exceng the lowest limit OF tolcranc" IN the
the highest possible mark OF excellence, which by
their contract. the company was bound TO attain
After some time spent In negotiations. the Car
negie Steel Company appealed from the Secretary OF
the Navy TO the President VINO on January w.
assessed the DANA ges against the COMPANY at $40
4S4 81 and the company January u. 1884. settled
with the Department. ~,
There was evidence showing or even tending
10 show that any Of the officers above those i'm
medately experimenting the tempering and hea l.
! ing at all cOgnizant OF these iTIeguiaritlcs,
but the company was responsible for the acts
OF its employees, damages 10 that eAornt we're ar
sessed against the company, ana the contracts con-
! tinued. .,. .....,.. ..
+his and all other points where contract work *
being done for the Government that it Is believed
to be impossible for irregularities TO occur IN
the future without immediate detection.
Secretary Hcrbert's statement Is. TO use his own
expression, "grauous' insult to the intelligence
Of tho reading public. He says that "all the arnor
manufactured for the Government was good eX-
ceiling the lowest limit OF tolerance In the specih-
/ cations" If this be the case the Carnegie Steel
Company did clearly all that Its contracts called
for How then could the President venture 10 fine
the company $liO4S; 81 and secure the payment OF
( that sum?
There IL not a word in either OF the two con-
! tracts which the Carnegie Steel Company has with
the Navy Department tina; the armor plates must
he ''up 10 the highest possible mark % excellence "
The trouble is that Secretary Herbert Is still
Withholding from the public the real nature OF the
attemptel frauds. He does this presumably 10
shield the company and carry Oui the agreement
Of secrecy which formed part of the bargain
( entered into between Mr. Carnegie and the Presl-
dent il is quite significant that he has not a word
TO say on this point Indeed it would be- Impossible
for him 10 deny IL.
OF course Secretary Herbert denies any cOnnec-
ton between the discovery OF the frauds and the
publication Of Mr.. Cernege's celebrated letter That
was TO have been expected. But he does II IN cx-
ceediuclv clumsy manner. He seems To think that
because the President assessed the damages against
the company June TO- therefore the letter Of
Mr. Carnegie. which bears date or January 3. could
have no possible connection with what b" calls a
business transaction
IA IS only necessary TO remind him that the agree
,nent was made the day that Mr. carnegie left
Washington December q. and that the time be
tween that date and January 10 was occupied b.
the Judge Advocate Generals Office IN drawing uT
the necessary papers for the signature OF the par