The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-09-12
Fat Contracts Secured and stock of
Companies Distributed Among
officials.
RING OF POSTAL EMPLOYEES
WHO WERE GIVEN a BIG ORDER
FOR LETTER-BOx DEVICES.
Names of Perry :. Heath and Mayor
hSShury, of Detroit, Mentioned
In Indictments.

WASHINGTON, Sept. I1.--Unted States
District Attorney Beach to-day announced
that the six persons named in the seven
Indictments returned by the grand jury last
Tuesday are:
GEORGE w BEAVERS, former chief of
the division of salaries and allowances,
PoStoffice Department.
AUGUST w. MACHEN, former general
superintendent of the free delivery system,
Postoffice Department.
JAMES w. ERWIN, former postoffice in
spector. with Headquarters in San Fran
cisco.
GEORGE III. HUNTINGTON and ISAAC
s. MGIEHAN, both of New York city.
owners of the Columbia Supply Company. of
that city.
EUGENE d. sCHEBLE. of Toledo o., a
dentist. and interested in the firm of May
bury & Ellis. OF Detroit. Mich, letter-box
manufacturers.
Beavers. Machen and Erwin are named
jointly In one indictment for conspiracy to
defraud the United States. Another indict-
ment is against Mcclellan. Huntington and
Machen for conspiracy TO defraud the
United States. and still another is against
the same three for conspiracy to commit
bribery both under Section $40 r. s. Sche-
ble and Machen are indicted jointly for con-
spiracy against the United States and again
for conspiracy to commit bribery Another
Indictment is against Mcclellan and Hunt
ington for bribery and the last is against
Machen singly for accepting bribes under
Section SOL Revised Statutes.
BASIS OF THE INDICTMENTS.
All the Indictments are based on transac-
tions' relating 70 the supply Of letter boxes
end package boxes and devices. Some SEN
sational charges are made The indictment
against Beavers, Machen and Erwin alleges
that the Postal Device and Improvement
Company of San Francisco. formerly the
Montague Indicator and Letter Box Com
pany. was composed almost entirely of
Western postal employees: that in 1889 ii set
aside LOCO shares of stock for forwarding
its interests and that. armed with this au-
thority, its president. Daniel s. Richard
son, and Inspector Erwin came to Washing
Ton, saw Beavers, Machcn, Heath and 9TH
ers and got order for equipping 2Os9 let
ter boxes with their device.
The indictment says the company was
systematically relieved of it's obligations in
the way OF paying freight. Grating, painting
and printing cards for the devices IL was
InTnishing- The indictment charges that
Peavers and Machen owned stock under as
sumed names. Most of the LOCO shares of
stock sft aside. tine indictment says, went
to different postoffice officials and again
President Richardson came 10 washington
and. following an increase i'm the contrac ct
price he got for the company, dividends
were paid on the stock.
McGiehan. principal owner of the Column
bia Supply Company of New York, is
charged with agreeing to pay Machen so
cents Tor each 81 70 paid on the package box
contract by the government. Specific pay
ments TO Machen are cited in consideration
OF increased compensation. and under the
package box contract Ostensibiy for attach
Ing different support TO the boxes
Schsble became interested in the firm of
which MayOr Maybury of Detroit. Mich
Is a member. and which furnished letter
boxes to the EOVprnmppf and Sohahlo nd
Machen. in "a joint Indictment are alleged
Go have scherned TO have defrauded the gov
crument by the supply of excessive quanti-
ties of boxes. The indictments saw that
Mayor Maybury and Ellis paid Scheble to
the extent or the latter's interest in the
company. and that he in return paid large
sums Nfachen. In seven counts the in
dictment cites specific payments to Machen
by Scheble. The other indictments involve
practically similar TRANSACTIONS Montague
whose name figures in the Montague fndict-
n,eat. II postmaster at San Francisco.
OFFICIAL STATEMENT.
A number of other postal cases are now
pending before the grand jury, which will
resume its sessions here next Monday.
The official statement regarding the in
dictment follows: THE indictment against
Beavers. Machen and Erwin alleges in sub
stance that the Postal Device and Improve
ment Company, OF San Francisco formerly
the Montague Indicator and Letter Box
Company. by resolution of Oct 8. 1899. set
aside 1.e00 shares OF its stock, to be used in
any legitimate way. its president might
think proper. In forwarding the interests of
the company. Armed with this authority
the president. Daniel s. Richardson, accom-
panied 10y Erwin. came to Washington. Err
win WAS then a postoffice Inspector and the
company was composed almost entirely of
postoffice employees in the West Erwin in
troduced Richardson to all the postoffice
ofic,sls az WASHINGTON. and Beavers, Ma
chen. Heath and others examined the de-
vice. As a result an order for equipping 2.0S9
letter boxes with the device was secured.
About the time at the suggestion from
Beavers. concurred in by Machen. the name
OF the company was changed. and IL was
arranged that all postoffice officials should
disappear from its management Beavers
and Machen became the owners of blocks of
the stock, both under assumed names. The
company was then systema tically relieved
OF its obligations in the way OF paying
freight Grating. painting and printing cards
for the devices il was furnishing Out OF
the 1,occ shares OF stock set aside above
mentioned. most all OF IL went to different
postoffice officials. The president of the
company afterward came 10 Washington
again with a request that an increase be
receiving sor its devices. This request was
granted. Dividends were afterward paid on
the stock
s'The ir.dictment against Mcclellan. Hunt
ington and Machen alleges that Mcclellan
was the person interested In the profits
from certain contracts from the United
States for furnishing package boxes from
July /, 1898. TO June l, 1897: that In pur-
suance OF scheme TO defraud the United
states Aachen recommended TO his superb
ors that the compensation OF the contractor
be increased. In payment for attaching a
different support TO the boxes. which raised
them higher from the ground. This scheme
was put through. and afterward when
Huntington became interested I'm the con-
tracts with Mcclellan. they continued TO
receive the extra compensation. The in
dictment Is I'm fen counts. the first two
counts charging the payment OF 500 TO Ma
chen on Sept. II. 1900; the third and fourth