The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-06-21
POSTAL THIEVES ORGANIZED.
EVIDENCES OF A SYNDICATE TO
LEVY BLACkMAIL.
The Rako-On on All Contracts for supplies
Fixed at 40 Per OBSERVATION-DISCLOSURES
After Gang That Operated for Years
-Go.Betweens Distribut ed the Cash.

t1Ne0 ~ ~ Fer Ncnt.-uuNcStIBHtOTS
After Gang That Operated for Years
-Go-Betweens Distribute ed the Cash.
WASHINGTON June 2O.-The most startling
feature OF the postal service scandals which
are now engaging the attention Of high
officers Of the Post Office Department
is the growing belief that the irregularity
and criminality which have been disclosed
are not simply the result Of tendency
toward personal gain, but are due to tho
operations OF an organized scheme Of graft.
This is the first time that an intimation OF
this character has been made, but, accord
ing to excellent authority the reasons for
such belief are sound and the actual proof
that such a syndicate or system existed
Is piling up day by day as the inquiry
progresses.
The attention OF the investigating au
thorities was first attracted by the fact
that the prevailing rake-of on depart
mental contracts was 40 per cent. Former
Superintendent Of the Free Delivery Di-
vision Machen IL charged with having re-
ceived 40 per cent of all sales to the Govern
rnent Of the patent fastener used on street
letter boxes. Charles McGregor and c. Ellis
worth Upton. two Of Machen s subordnates.
are charged with having received 40 per
cent. on sales Of rural free delivery mail
pouches to the Government. Other officers
Of the Post Office Department, who will soon
he indicted by the Federal Grand Jury,
are alleged to have received 40 per cent. on
sales of various supplies used in the postal
service. These contracts were made
through the salary and allowance division.
Forty per cent. is said to have been the
rake-ofr given to postal officers in the sale
81 the cash registers to the Government.
In other cases the investigating authorities
are morally certain that the rake-off was
this same 40 per cent.
When the existence OF such a system OF
blackmail collection was first limited at
some time ago-and it was not through the
newspapers that the matter was first
brought into notice--the high officers Of the
Department scoffed at the suggestion. 1t
was preposterous, they asserted absolutely
ridiculous TO believe that the postal service
harhored criminal organization. But
recent developments have made it abso-
h"lv necessary that the graft syndicate
he taken seriously. and the principal matter
urnn which post Office inspectors are now
", king concerns the existence Of this 40
pc" cent. system of collection on Govern
rI"1t contracts.
The reveat ions up to date point to the
IA that this LEGGED syndicate was an
a. iual organization, with directing head
ard officers designated to perform tn g
q, 'alls of the work. That the machinery
al this concern worked smoothly Is shown
by the fact that for year after year it's
- operations were continued without the
slightest suspicion being aroused. and that
,tw az not until the investigation OF postal
service scandals had been in progress
over three months that the matter was
seriously taken up by the officers in charge
Of the inquiry. Now that the matter has
been cons idered it will be pushed to as
speedy q conclusion as possible. and new
w be biousht o the aten
ton OF the Federal Grand Jury here and
in New York.
Postmaster General Payne will not cay
whether the head of the graft, syndicate
officers whose names have been men
toned In connection with the present in
auiry. or some person higher up. In
fact, he will not discuss the matter at all.
tow is equally reticent, contenting m
self with the statement that the public
will be acquainted with the facts in due
course of events.
But it is known that the investigating
authorities will at once begin an investi-
cation to unearth not only the head of the
syndicate, but the agent in New York who
had charge Of the business and the officers
of levy and collection: One reason. why
conviction will be difficult, it is said, is
hat the local officers or agents OF the graft
syndicate also had go-bet weens. and that
the rake-off was distributed by them In
cash and not in checks or drafts. There
may have been cases, however. where this
rule was not adhered to, and upon this pre-
sumption, and upon their ability to per-
betweens to turn States evidence. the In
vestigating authorities depend for getting
conclusive proof.
First Assistant Postmaster-General Wynne
to-day made a formal request of Postmaster
General Payne that an investigation of the
money order service and other branches
of the First Assistants bureau be immedi-
ately ordered. Supt Metcalf of the money
the Postmaster General for endcavoring
10 divert q contract for manufacturing
money order blanks from the lowest bidder
but It is not known that there was anything
Irther than grave on Mr.
ton will he to determine this fact. as we'll !
rs to give thorough cleaning out to the |
rest OF the bureau This division. like the
salary and allowance division, which has
was under Mr.. Machen's free delivery di- |
vision The free delivery division which |
Las formerly been under the control of the |
First Assistant Post master-jeneraI, was !
recently placed under Fourth Assistant |
Postmaster General Bristow, to lend greater
facility to the progress of the inquiry.
A special attorney from the Department |
of Justice will be detailed to the Post Office
Department to assist Attorney Charles |
4. Robb in the greatly increased labors |
uf the Office. When Mr.. Robb entered the
Department, the affairs of the Assistant
Attorney Generals office were in a de-
plorable state as a result of the scandalous
conditions that had prevailed, and tire
ing,ilar work of the office was months
l,ehindhand. Mr.. Robb has succeeded in |
bringing the routine work up TO date, and
in addition has acted as legal officer of the
Department and adviser of tho Postmaster
General In the many matters connected |
with the postal scandals. His services
have been greatly appreciated by the
President. the Attorney General and the
Postmaster General.