The times. [volume] (Washington [D.C.]) 1897-1901, 1901-03-25
AN ARMY COAT SWINDLE
Philadelphians Accused of Stealing
From the Government.
Two Contractors Placed Under Ar
rest by IN Secret Service Operative
-PecuIatiOns said to Have Aggre-
gated SIOO,OOO-A Unique Scheme.

| -Pecuint1Ons Said 10 HaNe aSSFe-
gated SIOO,OOO-A Unique Scheme.
| PHILADELPHIA. March 24.-After an
| investigation lasting over several months,
| the Secret Service officials yesterday
| placed in custody two men, whom they
| charge with being the principals in one
| of the most extensive swindling schemes
| that has ever been unearthed. 1t was
| only after every other agency failed that
| the services of the Secret Service opera
| tives were invoked The men were placed
| in custody late yesterday afternoon by
Secret Service Operative Matthew f.
Griffin. The prisoners are Louis Gold
stein and Zudick Levy, of 1894 Washing
ton Avenue The building is a sweat
| shop, and is conducted by the prisoners.
who are employed by the Government as
contractors.
At a preliminary hearing before United
States Commissioner Craig, in the post
office building, the defendants were held
in $3.50 bail for a further hearing on
| Tuesday afternoon next. A. S. l.. Shields.
who represented the prisoners, succeeded
in having them released on bail The
warrant for the contractors arrest was
issued by United States Commissioner
Bell charging them with entering into a
conspiracy to rob the United States Gov
eminent. Commissioner Bell will conduct
the final hearing in the case.
Assistant United States District Attor-
ney Thompson. who represented the Gov
eminent at the hearing, yesterday inti-
mated that other arrests would probably
follow Goldstein and Levy, he said, were
furnished with work from the Schuylkill
Arsenal and that institution will suffer
the loss their alleged peculation is said to
have caused. The men have been en-
ployed by the Government for a long
time, and their alleged swindling opera
tions are said to cover period of two
years During the Spanish-American war
they were furnished with considerable
work, from which, it is said, they made d
phenomenal profit.
Secret Service Operative Griffin, who
made a thorough investigation of the mat
ter, says that the method utilized by the
accused men was decidedly novel, fact
which shielded them for so long time,
Upon receiving the army coats which
were already cut out, the contractors are
alleged to have substituted inferior Innings
and facings, appropriating the goods fur-
nished by the Government for their own
use The material withheld consisted of
Innings and silk facings and large GUAM
tity of canvas used in finishing the coats.
The material thus retained is said to
have been placed in a large rag bag, filled
with discarded clippings of cloth. Every
Monday morning a rag peddler is said
to have called at the establishment and
carried off the bags to a warehouse,
where the sweatshop proprietors are al
legged to have called and obtained posses
sion of the Government property which
they are accused of purloinlng. The goods,
it is averred, were sold to various pur-
chasers, who, it was subsequently as
certained, were innocently constituted as
middlemen in the transaction.
The case heard yesterday is but an echo
of a similar one which was first called to
the attention of the Government several
months ago. At that time a contractor
named Samuel WeinsIein was arrested
and subsequently indicted, charged with
appropriating Government property TO his
own use. His case will be tried at the
present term of the United States Court.
The full magnitude of the case was not
discerned until the Secret Service officials
took the matter in hand. Three rag deal
ers who were arrested with Weinstein
were discharged as the evidence did not
connect them with the thefts.
The accused contractors are said to have
received on an average of $4,000 unfinish-
ed coats on a single assignment The price
paid for finishing each garment was 50
cents. Operative Griffin, who made an ex-
haustive enquiry into the alleged thefts,
estimates that the loss sustained by the
Government will amount to nearly 100000.