The Red Cloud chief., 1903-12-04

indicted by the Federal grand jury In the
city Of Brooklyn. N. Y"
h report continues:
I'm 1890. while John wanamaker was
Postmaster-General. an effort was made
to Introduce the Bundy time recorder for
use In the postal service. but II failed.
Later. during the administrator OF Post
master-Gcneral Wilson. upon the recon-
mendation OF a. w. Machen. II was adopt
ed. Machen estimated that the entire
frec-dclivcry service couiu he supplied for
sG.5 5000
In 1901 IN effort was made by First
Assistant Postmaster-Gcncral W. NJ.
Johnson aud his chief clerk. John NJ. Mas
ten. to reduce the price of these time re-
corders, but the effort was afterwards
abandoned.
I'll. J. Truesdell, who was agent OF the
company Mt the time these clocks were.
first adopted. states that he paid Macheu
$1,000 for his services In securing their
introduction into the service. Criminal
action on such payment In barred by the
statute OF limitations.
By the purchasing OF Cancellng ma
chimes for use In the postal service II In
shown that the government has Lost over
$4,000 which sun was divided among the
conspirators Interested. Here again Grim
inal action is barred by the statute OF lin.
Itatlons.
Says Mr.. Bristow:
'The most important contract for can
ceiling machines was that for the Dorc-
mus. Its original promoters were w. ID.
Dorcmus, the inventor: l.. 7. Kitchener.
member OF the law frm OF Dudley Il
| Kitchener. OF Washington. and II. J.
Truesdell. OF Binghamton. M Y. The
company was organized August 3. 1899.
ana capitalized for 100000 divided into
1000 shares OF 800 each. Truesdcll was on
Intimate personal relations with Beavers.
and In 1899 an order was given for 100
| mnrllnna AZ KIM nnnh Inn0 hnfnr, nI
OF the 100 machines had been delivered
tho department received numerous COM
| piaints from postmasters stating that
they were worthless. ana on account of
tho great dissatisfaction with this first
100 known as Model No. I the Dorcmus
company established a factory of It's own
In Washington and created Model No. 2,
and Beavers. without testing It's eficien-
~. on June 20. 1900. contracted for 100 OF
the new machines at s225 each. Model No.
2 also proved n failure, and Model No. 3
was made, aud Beavers promptly gave an
order FOR 100 machines OF that model at
Sa25 each.
"Of the 700 machines purcha sed OF mod
els Nos. ] and 9 but 80 are now In use,
the remaining l6l being practically q net
loss.
six hundred and sovcnty-one OF these
machines have been ordered by the de-
partment, ut IA net cost OF slis. as. This II
"A repetition OF the story OF automatic
cashiers and Elliott & Hatch typewriters.
except that II In oil "a larger scale.
In 1901 Truesdell and Green became e.
trangcd and Truesdell left the employ of
tho Bunday company, ana also sold his
interest In the Doremus canceling ma
chine. When interviewed by the inspec-
tors Truesdell stated that before the Sec
ond order on Tune 30, 1900, was given for
100 machines Green told him he had
transferred to Perry 4. Heath. First As
sIstant POstmaster-G General. SO, 900 worth
OF his stock, In consideration OF receiv-
Ing an order for not less than 200 ma
chimes.
Heath refused to make a written state
ment. but said verbally to Inspector Sim
mons that he never received any stock
from the Doremus Canceling Machine
Company or any remuneration OF any
kind. directly or indirctlye.
"On October 3, 1909. indictments were
found against Green. Doremus and Beav-
ers for conspiracy to defraud.
The evidence against Heath was also
submitted to the district attorney. wh0
decided that II was not sufficient to war
rant his Indictment.
The administration OF Beavers was, II
possible. more demoralizing upon the in
tegrity OF the service than that Of Ma
chen"
In conclusion the report says:
For the purposes Of this report, the
investigation ordered by you on March
7 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.
THE system of organized corruption
that has been disclosed began In 1893 and
continued until stopped. by this investiga-
ton. The amount OF money secured by
tho corrupt officials and their confeder-
ates Is small as compared to tho total
loss to the Government. TO illustrate:
Barrett received but So, 900 from Ar
mold, yet that company defrauded the
people out of over 81. 00O.0 900. Machen
probably did not receive more than $26,-
900 from the Groff fastener. Yet the gov
eminent has paid approximately $3.50. 900
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 $50. 900 from tho automatic cashier.
Yet the Department expended s74,275 for
this wholly unnecessary machine. The
total amount that the perpetrators OF
these frauds themselves received can not
be definitely learned, but It will aggre-
gate between $500. 900 and $500. 900. while
the loss to the government. considering
the unnecessary supplies that have been
purchased and the inferior quality OF
those furnished by fraudulent contract
ors. can not be estimated with any de-
gree of accuracy.
"As the gross abuses nave been
brought TO light they have been prompt
~ corrected by the proper departmental
officers. Contracts where fraud has been
discovered have been annulled.
THE results of the Investigation dem
onstrate that all travelling agents OF the
Department-such as assistant superin-
tendents OF salaries and allowances, OF
the free-delivery service. the Railway
Mail Service. and the registry system.
and inspectors-should be placed under
one orgHniza tion.
"A number OF changes should be made
in the organization OF the Department in
order to provide a more perfect check
on the operations OF various divisions. and
some restrictive legislation affecting the
divisions OF salaries and allowance, OF
rural free delivery. and possibly others
may be necessary. What the service
most needs. however. In honest. intelli-
gent, and vigorous administration. The
corruption disclosed Is not due to lax
laws. but TO the dishonesty OF those who