Omaha daily bee., 1897-03-20
Mystery in Connection with the Missing
Money Clearing Up.
EMBsZZLES SINKING FUND WARRANT
Two Hundred Thousand Dollars Stolen at a
Single Swoop,
DETAILED ACCOUNT OF THE TRANSACTION
Deliberate Haste of the Ex-Treasurer to
Lay His Hands on the Cash,
DEFRAUDs STATEN COMPUTING INTEREST
Ignores Plain LAW and Increases
the Sum Total of His Theft by
Two Per Cent on the
Principal.

LINCOLN, March 19.-(Specal)- Since
Governor Holcomb sent his special message
to the legislature on the treasury shortage,
people in and out of the statehouse have
been puzzling their heads over the where
abouts of the S537, 900 for which ex-Treas-
urer BARLEY has failed to account. The
disappearance of the S336OOO of permanent
school money is easily explained, because
BARLEY had undisputed possession of the
school funds and always insisted that It
was his prerogative to do with them as he
pleased. The $201.0O0 represented by the
hole in the sinking fund, however, has thus
far been practically a mystery. The pay
ment of this money from the general fund
into the sinking fund should have been
merely formal transfer on the books, and
If a warrant was drawn it should have been
drawn to the state and at once turned into
the sinking fund. Under no possible theory
could the treasurer assume the right to
take such warrant in his individual capacity,
much less to dispose of it to other parties
and convert the proceeds tt his own USE
So far as the books in the treasurer's
office are concerned they show simply that
the money for this appropriation was drawn
out of the general fund.- but was never
CItuIiSu W lut SlUkIuS lunQ nor turneU
back to the treasury. 1t now transpires that
the warrant in question was Illegally
drawn, as well that the interest paid
upon 1t was computed in direct violation Of
the law.
ACCOUNT OF THE TRANSACTION.
The act under which the sinking fund was
to be reimbursed was one of the general
appropriation acts passed by the legislature
of 1895 and called for the payment out OF
the general fund of $3.50 10175 to rsim-
burse the sinking fund for that amount of
money which had been lost through the
collapse of the failed Capital National bank.
The warrant was drawn by Mr. Barley
upon the 10th day of April 1895, and regis
tered by him on the same. day. The stub
in the auditors office reads as follows:
No 9524l. s1SO1017k
Lincoln, Neb. April TO- 1895.
State Treasurer pay to
j. S. Barley
or order - tt,l
For To reimburse state
sinking fu;ld.
The warrant which was attached to this
stub is in the hands of State Treasurer Me-
serve, who has declined to show it to The
Bee representative except upon order of the
attorney general, The warrant was held
from April 10 until January Q, when it was
paid, together with interest at per cent,
amounting to $21 1920, or total of $2O1,-
SS4.05. The call under which this warrant
paid was issued by Treasurer Barley
about week before the expiration of his
term and provided that interest on the war
rants in question should cease January 8.
AS a matter of fact therefore, the warrant
was paid seven days before it was legally
due under the call.
WHEN THE WARRANT WAS SOLD.
The books show further that on the day
the $201 ,0OO warrant was paid, the state de-
posit in the Omaha National bank was de-
creased by that sum. According to in
formation that comes from j. II. Millard.
president of the Omaha n. s:ial bank, Bart
ley notified that institution in April, 1895,
shortly after the appropriation had been
made by the legislature that he had a reg
istered state warrant for $3.50 .75 which
he wanted to dispose of and the Omaha
National negotiated the sale OF it to the
Chemical National bank of New York City.
The warrant was held by the Chemical Ma
tional until shortly before the election last
November when it was forwarded to the
Omaha National for collection. When pressed
for payment, Barley, notwithstanding the
fact that he had over 81 500 900 of cash on
hand in the general fund, pleaded lack OF
means and kept putting it off on one pretext
or another. In the interval the deposit OF
state money which he kept with the
Omaha National was, according to President
Millard, gradually increased, till finally on
January 2, 1897, Treasurer BARLEY remitted
check upon the Omaha National to take
up the warrant, and the warrant was re-
turned to the state treasury The $201, 900
paid out in January, 1897, therefore went tn
make good with interest to the Chemical
National bank of New York what it had
advanced in April 1895, or the $lSO,OO0 state
warrant. What Mr.. BARLEY did with the
money realized from the sale of the warrant
in April is not clear. He must have used II
for his own purposes, because he has left no
record of its disposition in the treasurer's
Office How his appropriation of this warrant
and its proceeds can be viewed as anything
but bold theft Is not comprehended by those
who have knowledge of the facts.
STOLE TWO PER CENT INTEREST.
This is not all, however, In computing
the interest on this warrant at per cent for
the twenty months that 1t was outstanding
Treasurer BARLEY committed another fag?ane
violation of the law. State warrants had
been drawing per cent interest up to 1895,
when the legislature passed two acts reduce
Ing the rate OF interest to 5 per cent. The
first act, which became law April 4, 1895,
was without the emergency clause and was
followed by another act, with the emergency
clause. which became law on the 10th day
OF April, 1895, The appropriation under
which the s2O1 900 warrant was drawn was by
virtue of an act which also became law
on the 10th day of April. The records In
the governors Office, however. show plainly
that the law reducing the rate OF interest to
5 per cent went into effect before the law
authorizing the reimbursement of the sink
ing fund,
The record shows that house roll No. 81
reducing the rate of interest from per cent