Evening star., 1901-11-14
Its Status Clearly Explained by Mr..
Erwin.
The PROCEEDINGS IN CHICAGO
No Agreement for a New Trial
With Defendant.
MON Ely r ECON E r E d


yerted to his own use by o. NJ. Carter while
in charge of river and harbor improvements
in Georgia, is just back from Chicago.
where he brought about last week some
new developments in the proceedings there.
Mr. Erwin is in Washington for the pur-
pose of assisting in the presentation of the
governments side of the habeas corpus ap-
peal in the Greene-Gaynor removal case,
successfully managed by him for the gov
ernment in New York, and which will come
up for argument before the Supreme Court
in day or two.
No Promise of a New Trial.
Mr.. Erwin stated to a Star reporter In
reference to the published statement sent
out from Chicago three or four days ago
to the effect that Oberlin NJ. Carter had
voluntarily agreed to surrender to the re-
ceiyer in the governments suits the SId0,Oo0
of investments into which the government
claims the funds intrusted to him had been
fraudulently diverted, and that in consider
alton Mr.. Erwin the governments coun-
sci had entered into agreement to give
him new trial and chance of vindica-
ton In the civil courts. that the statement
sent out from Chicago is absurd. 1T ought
not to require a lawyer. continued Mr..
Erwin. even to understand that under our
system of government no agreement of
council in a civil case could set aside the
solemn verdict of a court-martial after re-
view and approval by the President of the
United States, even if counsel had no better
judgment than to attempt to make such an
agreement.
The Facts IN the Case.
The facts in the case, briefly stated are
these: We had already traced and tied up
in the hands of receivers. bills filed in
New York. New Jersey. Georgia and West
Virginia. some S3To.O00 of the investments,
mainly unregistered railroad securities,
into which Carter had diverted the funds
dlSDurSlng
None of this had been surrendered vol
unfairly, and the means taken by Garter
and those associated with him to secrete
them. and the manner in which we traced
and caught these assets, would make a
Sherlock Holmes story, which some time in
the future expert bank examiner, Mr..
Edward l. Johnson. will have to tell
There were other of the assets, how
ever, still concealed, and some six weeks
ago We had traced the sale by Carter's
uncle and brother, through brokers in Chi
cGgO. of the other S4O.Gtp of the unregis-
tered bonds identified by serial number,
constituting a part of the diverted funds.
Demand for the Funds.
"A bill was filed in the United States cir
cult court at Chicago against o. NJ. Carter,
his uncle. l.. d. Carter. and his brother. l.
Stanton Carter, and a receiver was appoint
ed by Judge kohlsaat to make demand for
and take possession of the trust fund. In
response to the demands of the receiver, l.
Stanton Carter and l.. d. Carter denied
having possession of any of the fund.
Il then obtained rule from the court re-
Quiring them to turn over the assets
charged to be in their hands or show cause,
at a day fixed a month ahead. why they
. should not be punished for contempt OF
court.
Securities Secured.
II then came east and filed an amend
ment making new parties defendant to the
bill pending in New York An order was
obtained from Judge I.acombe extending
the receivership under this amendment
As result of this proceeding l obtained
possession about three weeks ago from a
man who had secretly acted as Carter's
agent in New York of a receipt given a
year ago to him by L. Stanton Carter for
over 100000 worth of the missing identified
securities Ne found. however, that We
had already captured in West Virginia the
proceeds of 500. 600 of the securities this
receipt. and also about $4,000 had already
been tied up by our proceedings in Georgia.
This left about s15a,Uo0 on that receipt still
to be accounted for by the Carriers in Chi
cago- Armed with that receipt and other
pertinent evidence l returned to Chicago to
press the rule for contempt
In the meantime l.. d. Carter and L.
Stanton Carter had filed answers to the
rule. setting up that they were not bound
to disclose any assets to the receiver,
II might incriminate them, even If they
had any, which they denied We had
preliminary skirmish in court on the pro-
duction of certain bank accounts in which
ceipt and original checks with the defend
ants Endorsements upon them.
Surrender Made.
This was followed by a conference of
counsel. which resulted in the surrender
by L. d. and l. s. Carter of $4,000 worth
of the identified securities and an agree
ment under which they are to account
forthwith for the balance of the assets
traced into their hands on the receipt and
g,,1I
of any interest in themselves in any of the
properties claimed by the government In
bills. o. N. Carter is to dismiss hts
demurrers and exceptions and file his an
swer 10 the bills promptly, and the is
10 be put at issue on the merits.
The government has not agreed to dis
miss the rule for contempt, but merely
given l. ID. Carter and /. Stanton Carter
the opportunity to account out Of court to
the receiver If they can; and if they do so
account that part of the proceeding will
not be pressed
so far l.. D. Carter and /. S. Carter have
not turned over or satisfactorily accounted
for at least $4,000. In addition to that
turned over Saturday. and unless they do
SO the contempt proceedings will be vigor-
ously pressed as soon as i get back to Chi
cago- am assured. however, that they
will make clear showing in few days.
THE $4,000 secured on Saturday brings
up the amount OF the diverted funds traced
and corraled to about $4,000. every dollar
of which was traced only by the exercise
OF great ingenuity and labor. and secured
only through the application Of the
mary processes Of the courts.
No Agreement With Carter.
There Is absolutely no agreement to
bring Carter out of the penitentiary or to
give him a new trial any other chance
Of vindication than what he already pos
sessed. OF course he has a matter Of
law the right to claim the property in con-
troversy as his own and to defend the claim.
and incidentally to try to disprove the
charge that the property was obtained by
defrauding the government but the proof
OF the fraud is burden which the gov
ernment cheerfully assumed in this case
when IL filed these suits and the results so
far have not been dispiriting-
1t has borne that burden successfully
twice aiready-once in toe court martial
and once In the removal proceedings against
the contractors in New York
The recent recovery of the diverted
funds in the actual possession of his rela-
uyes, holding the same for his account
does not appear. at least to one on the op-
posing side of the controversy, to present
M ed INN