The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1898-03-23
Nictimized ny Employees Of the Gov
eminent Engaged in Upper Mis-
sissippi improvements.
FRAUDULENT TIME CHECKS
CAsHED BY THE BANKS, WHICH NOW
WANT REIMBURSEMENT.
Little Business of Importance Trans
acted by Congress Yesterday-Two
Bills Discussed by Senator's.

WASHINGTON, March 22.-Information
has reached the government through num-
Der of banks at ST. Paul, Mimi, that during
the past year and more these and other
nearby banks have been made the victims
of colossal frauds through the suspected
collision of government clerks connected
with the commission having in charge. the
improvements on the upper Mississippi
river Full details of the affair have net
reached the government. but the statements
submitted by the banks indicate that $780,,
600 or more has been procured from them
through fraudulent time checks for services
never performed. Copies of some of these
time checks are said to be signed by j. s.
Southali chief clerk of the United States
engineers office at ST Paul, and are dated
a. different times during the year 1897. 9th
ers, it is understood, are dated in 1886. How
the banks came to be imposed on TO the ex-
tent indicated and why the checks have been
withheld until this time cannot be even
coniectured 1t is understood that the banks
win make a claim for reimbursement but
the law is said here to be clearly against
this contention. The government will begin
q searching investigation at once into the
whole matter.
Full Extent of Fraud Not Vet Known.
ST PAUL. Mimi, March 22-Just how
great the loss through the government time
check fraud may prove to be cannot be
known until an examination of the books
of the engineering department has shown
which checks are good and which false.
About three weeks ago the local banks,
which first became interested through some
Hartford, Conn.,, holders of the paper be-
gan an investigation and became satisfied
-
excess of the money appropriated by the
government to carry on the work of the up
per Mississippi river After several inter-
views with Southall in which it is claimed
that he tried to prove that there was moth
ing in the claims. it is said that ne finally
admitted that fully % per cent of the
checks that are now outstanding are worth
less. TO protect themselves the banks at
once took the stand that the government,
having adopted d scheme for the payment
of the workmen employed by it that en-
abled All employee to defraud the banks and
other innocent purchasers of the paper. 1T
should be compelled to stand the loss The
filing of the claims of the banks for the
payment of the entire amount of the checks
was made in Washington, with the result
that the matter became public.
j. H. Southal, has been employed by the
government for a period of more than fif-
teen years, up TO six months ago. At that
time he resigned the position of chief clerk
of the engineering department in this city,
being succeeded by J. D. Dushane. 1t was
given out at the time that Southall retired
from the position of clerk that he had made
considerable money in a speculation in corn
and that he intended in the future to devote
his entire time to the stock market. His du-
ties, while he was acting as clerk, were to
keep the time, as turned in by the foremen.
OF the pay that was due the workmen and
in time to pay them off in these time
checks.
The time checks were often bought up in
large numbers by spectators. were cashed
by banks and were held until the govern
ment was prepared to meet the bills, when
Seuthall would receive a remittance direct
from Washington and would then deposit
the money in his own name and take up the
checks with his individual checks. BY do
ing this for period of fifteen years his
signature became perfectly we'll known to
all the banks in this vicinity, and his credit,
with the government back of the paper that
he issued, was considered as good as gov
Of the 100000 or 100000 worth of time
checks known to be outstanding probably
less than one-fourth was held by banks and
some of this was held by them for indi-
Viduals. Two local banks, which failed III
teen months ago. held over 900, and near
ly as much more was held by Hartford,
Conn., bank. One man in Wisconsin, whose
name could not be learned to-day, had
bought $64 COO worth of these checks and
$40 900 more had been taken as good per-
sonal investment by st. Paul capitalist.
In smaller amounts the time checks are I'M
derstocd to be held all over the country,
and ii win be some time before the full
amount can be learned.
r III Southall is tonight at mis- home in
ST. Anthony Park under charge of de-
tective, although it is stated that he has