Omaha daily bee., 1899-04-04
CONDEMNS STATE AUDITOR
Complete Report Filed by the Legislative
Investigating Committee,
FIND MANY THINGS DECIDEDLY QUEER
Insurance Examiner Not h only
ones to Take Money Not RightfuIly
Due Them - Entire
ment of the once Lax.

the legislature to investigate the charges OF
crookedness in the conduct Of the auditors
office. The report was a unanimous one
and bears the signature OF every member
OF the committee, which was composed OF
Senators Currie Of Custer, Prout OF Gage,
republicans; Hale Of Madison, democrat;
representatives Evans OF Adams, Fisher OF
Dawes, republicans, and Weaver of Rich
ardson, fusionist.
Your joint committee appointed to In
vestigate the management and affairs OF the
Office OF the state auditor Of public &C
counts during the incumbency OF the Hon.
John i. Cornell beg leave to submit the
following:
I'm pursuance of the appointment OF this
committee by the legislature Of the state
OF Nebraska and the authority granted by
said body to employ stenographlc assist
ance, issue subpoenas and other process and
carry out the purpose for which said com
mittee was appointed, John w. Dixon was
chosen as clerk and stenographer, and he
has had during said investigation the as
sistance OF three other stenographers, for
all Of which services this issued
vouchers for the sum of 81 900 against the
appropriation for legislative expenses OF
the Twenty-sixth session of the Legislature
OF the state of Nebraska.
This committee also employed ]. A.
Abbott, an expert accountant, to make an
examination of the accounts Of the auditor
and Issued a voucher in payment therefor
for the sum of $3.50 against the same APP
preparation.
THE committee has also Issued vouchers
for incidental expenses to the amount OF
above $50. making the total Of 81, $50. This
includes the entire expense incurred by said
committee.
Objects of the Committee.
at has been the purpose of said commit
tee TO eliminate all politics from this in
vestigation, as we'll as any matters Of per-
sonal controversy between the auditor of
public accounts and his discharged insur-
ance deputy, Samuel Llchty. Mr.. Lichty
has appeared before this committee the same
as any other witness for what information
he could give the committee. The purpose
of this investigation has not been to pass
upon the question of Mr.. Cornell's loyalty
to the tenets and teachings of the pc,
litical party to which he gives his allegiance.
Mr.. Cornell's party loyalty or his party
treason is a question for the tribunal OF
his own party associates, and the committee
has therefore disregarded any popular
clamor either for or against him on the
grounds of party expediency. The sole OBJ
1ect in creating this committee, the sole
purpose Oh the committees dlleI II WdS
created, is and has been to fairly and i'm,
partially, without political prejudice or a
consideration of personal differences Of any
persons whomsoever, inquire into the con-
duct and administration of the office of the
auditor OF public accounts during the in
cumbepcy of the present occupant of that
Office. With this purpose in view the com
mittee has held in all thirty sessions,
which, with the exception of ten executive
sessions. have been open to the general pub
lie. A great mass Of testimony has been
taken covering 1,247 pages, exclusive Of re-
ports, of typewriter matter, which we
herewith submit as part of our report
From this testimony we respectfully re-
port the following findings of fact:
summary of Findings.
q. That John F. Cornell has been audi
tor of public accounts OF the state OF Ne
braska since January, 1897. That during
his incumhency in said Office there has beer
a great deal of friction between the va
rious departments of the office, owing tc
the unwise selection of his subordinates
This condition OF affairs is responsible tt
some degree at least for the irregularities
occurring therein and hereinafter pointed
out.
"2. That John f. Cornell. by virtue of his
office as auditor of public accounts, received
various fees from Insurance companies doint
business in this state from the date OF hi
inauguration as auditor in 1897 until Feb
ruary II. 1898, and instead of paying then
directly to the state treasurer, we 1nd tina
he deposited same partly to his private ac
count in various banks, and partly to hi
account as auditor in another bank III thl
state. That these funds in most case
we're deposited and mingled with his owl
-G...- g,.a, ma that hn had IN 1ann1itpI
various sums throughout said period. A
one time the amount of such funds in thes
private banks aggregated the sum of $4,000
which the committee finds he had In hi
possession, and so deposited for a period o
three months. This practice OF the stat
auditor has been the custom of the ottic
for years past. The fact that the stat
treasurer objected to receiving small check
is a partial explanation for the auditor con
tinuing this unbusinesslike and dangerou
method in vogue under former regimes, MI
Cornell ~testifes that he regarded these fee
as state money. We further find tina
the auditor did not speculate with no
loan any of this money to private indiyid
uals, and received no interest or anythini
of profit from these funds, and that tn
hanks in which such money was deposite
have always been institutions of high stand
ing and solvent in every respect. Mr.. Cor
nell testifes, and We have no evidence I
the contrary, that he was able to pay owe
to the state at any time all moneys OF tn
state so held by him. That since Februar
II, 1898, which is about the time that tn
supreme court rendered its decision in TN
Eugene Moore case, the auditor has not re
ceived any such fees, and that all none
retained by him temporarily previous to thi
date has been paid in full into the stat
treasury. We arrive at the above facts froT
The testimony of Samuel Lichty, as well a
from the evidence of the state auditor him
Ielt.
Your committee further finds that Samu'
Lichty, as insurance deputy, also kept fo
A short period at various times, insucanc
tees coming into his hands, IL having bee
me rulo of the office that he should wa
lntil "A page OF entries was completed befor
turning the said moneys over to the stat
auditor.
mir. Lichty was also In the habit {
using cash out Of the cash drawer OF the in
surance department and depositing thereto
his due bills, and settling for such item
by check with the state auditor at the var
Ous dates of settlement. Mr.. Lichty test
hes that he had the equivalent OF sue
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