Evening star. [volume] (Washington, D.C.) 1854-1972, 1903-11-30

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he procured the money by checks on the
Seventh National Bank Of New York
cashed at the Citizens National Bank by
Ida e. Crowell. Ida E. Crowell and the
records Of the Citizens National Bank con-
firm Truesdelrs statement as to the CASH
ing of the checks.
Ida E. Crowell states that the money pro-
cured by cashing these checks was charged
on the books of the company to commits
sion account" Her statement is corrobo-
rated by William w. Long of Washington,
ID. e., bookkeeper, who was employed to
post the books OF the Doremus Machine
Company, who states that he found such
entries on the blotter and ledger, made by
Mrs. Crowell. but no name was given as to
whom the money was paid.
Mrs. Crowell and Truesdell left the en-
ploy of the company in 1901, and since then
Green attended to the business personally,
as he did In the case of the Bundy clocks.
He has left a more definite record of the
money paid to Beavers than was left by
Truesdell.
AS has been stated. an account Of the
company was kept in the Seventh National
Bank Of New York. In the same bank
Green also kept an account. On March IA,
1902. Green drew a check for $500 on the
account of the Doremus Machine Company
in the Seventh National Bank; on March
Is the personal account of Green in the
same bank was credited with the same
amount. and on March IS Beavers deposit
ed in his account in the Nassau Trust Com
pany OF Brooklyn, N. Y, check on the
Seventh National Bank of New York for
$500. and on March 10 the personal account
Of Green in the Seventh National Bank OF
New York was charged with $500.
On May 10, 1902, check for 81 900 was
charged to the account Of the Doremus Ma
chine Company In the Seventh National
Bank, and on the same day the personal
occount of Green was credited with that
sum; four days later George w. Beavers
deposited by letter from Washington. D. c.,
rx-tfh hA hrnlr G,.,o <xPA C1l,l
OF New York the personal check of George
e. Green for 81, 600
On juno "a. 1902, the account OF the
Doremus Machine Company In the Seventh
with check for $1,75O, and on the same
day the personal account Of Green in the
same bank is credited with the Identical
sum. The next day Beavers deposited with
the brokerage firm Of Moore & Schley Of
New York the personal check of George E.
Green for $1.75O
There were 100 Doremus canceling ma
chimes installed by the Post Office Depart
ment from January 1. 1902. to June 1. 1902.
The three checks referred to aggregate
$8,26O, an amount exactly equivalent to e25
each on 100 machines
When the inspectors inquired of Green as
TO these payments to Beavers he refused to
make any statement. He was supoenaed
before the grand jury and he stu refused
to answer any questions.
The inspectors also called upon Doremus
and asked permission to examine the books
Of the company to either verify or disprove
The truth OF the statements Of TrueSdell,
Ida e. Crowell and Long, but they were re-
fused permission to. see the books. Do
remus claimed that they were not In his
custody; that he had no authority over
them and could not therefore permit them
to be examined: that they were In the
charge OF L. B. Fish. the bOokkeeper. Fish
was subpoenaed to produce the books be-
FORE the grand jury He answered the SUBJ
poena. but stated that the books Of the
company had been burned last winter
On October 8, 1903, indictments were
found against Green, Doremus and Beav-
ers Tor conspiracy to defraud.
The evidence against Heath was also
submitted to the district attorney, who
decided that 1t was not sufficient to war
rant his Indictment.
The administration of Beavers was, If
possible. moro demoralizing upon the in
tegrity Of the service than that Of Machen.
Conclusion.
For the purposes OF this report the in
vestigation ordered by you on March
has been completed. In the preparation Of
cases for trial where indictments have
been found, Information may be secured
which will necessitate further investiga-
ton and possibly involve persons not now
implicated.
More than forty inspectors have been
employed upon this work. some Of them
continuously every day since the investi-
cation began. The records Of LOCO post
offices have been examined, and the files Of
many divisions of the department, cover
ing period Of from six to ten years. scru-
tiniZed.
The system Of organized corruption that
has been disclosed began In 1893 and con-
tinued until stopped by this investigation.
The amount Of money secured by the cor
rupt officials and their confederates Is
small as compared to the total loss to the
government. To illustrate: There Is no
evidence that Louis received any compen-
sation from Ault & Wiborg, yet during the
first year Of his administration the ex-
penditures for canceling ink increased over
10000.
1t does not appear that Kempner re-
ceived money from the manifold company
yet the cost Of manifold supplies increased
more than $4,000 a year.
Barrett received but $4,000 from Arnold.
yet that company defrauded the people out
Machen probably did not receive more
than $4,000 from the Croft fastener Yet
the government has paid approximately
100000 for that device, which represents
a net loss, since the department continued,
by the terms Of the contract for letter
boxes, to pay for the original fasteners.
Beavers and his associates received less
than $4,000 from the automatic cashier
Yet the department expended sf4,2io Tor
this wholly unnecessary machine.
The total amount that the perpetrators
of these frauds themselves received cannot
be definitely learned, but 1t will aggregate
between 100000 and 100000 while the
loss to the government, considering the
unnecessary supplies that have been pur-
chased and the inferior quality or those
furnished by fraudulent contractors, can
not be estimated with any degree OF ac-
Curacy. ,. A..
AS the gross abuses have been brought 10
lieht they have been promptly corrected by
the proper departmental officers. Contracts
where fraud has been discovered have peen
aELulled.
AS result of the investigation four OF
fcers and employees of the department nave
res,ered and thirteen have been removed
Fcrty-four indictments have been FOUND
IL volving thirty-one persons, ten or whom
have been connected with the postal ser
vice Attached TO this report is list or
these who have been separated from the
service by resignation and removal; also a
complete list of the indictments and the
persons involved.
1 can not speak in too high praise of the
Industry and intelligence of the inspectors
end their loyalty to the interests or the
service The success of the investigation
Is largely due to them. They have sought
the truth with eagerness and skill. No ac-
counts have been too intricate for them to
unravel, no labor too burdensome to under
take. Under the immediate charge of Chief
Inspector William E. Cochran, they have
worked in perfect accord. A list of those