Evening star. [volume] (Washington, D.C.) 1854-1972, 1898-01-08
DEFECT IN THE FORM
How the Frauds in the Money Orders
Were Possible.
Result of the New System of Audit
A Test Case Against
Postmaster.


by The Star Of the frauds discovered in
the money order system created quite a
sensation H. post office circles, and the off,
Gals were perplexed this morning to find
out how the information leaked
Every>line printed in The Star yesterday
has been verified. The auditor of the Post
once Department was averse to discussing
the matter this morning, but acknowledged
that The Star had the story correct in all
details
Developments are crowding each other
thick and fast. and some of them are so
startling that 1t has been decided to have
al investigation of all postmasters' &C.
counts from the first of last July with the
pfeseht force This, it Is expected, will
bring out many glaring frauds. and event
suaIly result in an official investigation go
ing back over period of three years, since
the present system was inaugurated.
Defect In the Form. ....a 3aS4
Auditor Castles determination to change
the system of audit, as stated in The Star
brought to light the frauds, which, under
the money order system adopted by Con-
gress upon the recommendation of the
Dockery commission, were believed to be
impossible. 1t is now conceded that the
form of money order is defective in several
respects, the principal one being the i'm
perfect register of the coupons by the
printer, which are almost bound to occur.
L his imperfect registration complexities the
checking by the accounting officers and
mistakes are of frequent occurrence.
But there is another reason why the
money order system should be changed,
more potent than the one which makes
mistakes liable. 1t is that during this
month the post Office officials expect an
adverse decision in the case of Berry
against Wynkoop-Hallenbeck Co. The
former claims the ownership of the pat
ent which provides a margin coupon and
has brought suit against the government
contractors for an infringement. The case
IS pending in the appellate court of New
York, and ii is expected it will be decided
about the 18th instant. To provide against
embarrassments the post Office officials
have had introduced in Congress a bill
which will repeal the law under which it is
only possible to use the present money or
DER form. and ask for authority to prescribe
form simpler and better
Nesv Form of Money Order.
Yesterday Representative Dockery called
upon First Assistant Postmaster General
Heath and urged the department to take
no action looking to the passage of this
bill until after he had been given an op-
portunity Of investigating the present sys-
tenn of audit. While 1t is possible the post
Office officials will not press the bill, they
are, nevertheless quite anxious for its pas
sage for with an adverse decision from
New York the department would have to
Immediately cease the use Of the present
money order Anticipating the passage of
the bill. the department has prepared sew
eral forms Of money order to take the
place of the one now in use. While no par
ticular form has been decided upon, it is
believed the new money order will do away
entirely with the coupon, and consist
simply of two parts, the order proper and
the advice. This would make it practically
impossible for postmasters to defraud the
government, and the form would not in
fringe any patent.
The only fault that is found with the
present form Is the continual liability to
mistake. The system upon which 1t was
based appears to be perfectly secure, the
officials s"y, although its force Is destroyed
by the mistakes which occur through the
printing. The register on the coupon
eide, which denotes the amount for which
the order is issued is very often imperfect,
creating confusion in the checking up of
the account.
Test Case to BE Made.
A test case is shortly to be made. and
upon it's final outcome viii rest future
and further investigations. From the rec
ords 1t appears the department has made
out a clear case against postmaster from
the west whose accounts were closed a
short time ago. 1t was presidential Of
fee. and quite large one. When Auditor
Castles new system of auditing went into
effect two cases were Immediately brought
to light against this postmaster. The rec
ords showed q deficit Of 500, and forth
with the papers were sent to the Postmas-
ter General for action. 1t Is understood
Chief Post Office Inspector Hamlet has
taken charge Of the case. and his inspect
ors are now Mt work. II this case proves
to be one requiring criminal action, 1t is
believed the accounts Of all postmasters
who have held office during the past four
years will be reopened and investigated.