The San Francisco call., 1905-04-29
John Smith Tells of Former
Defalcation, How 1t Was
Made Good, and Refutes
RIlmors of Fabrications
BROTHER COMES TWICE
TO TAXMAN'S RESCUE
Money Paid After Discovery
i'm the Records That Ac-
counts With the Treasurer
Were in a Bad State

John r. Smith. the brother Of ex-
Tax Collector Smith, Indignantly de-
MED yesterday the intimations given
out that the story Of the big shortage
Of $165,00 which was made UP last
year by James B. Smith, another
brother, is a myth. Acting Tax Col
lector James w. McCabe lends some
color to the theory. however, that
there was no shortage and that the
Tax Collector merely bilked his
brother, for the former deputy's rec
ords show that all taxes were acl
counted for by the payment Of coin.
with the exception of those delin-
quent.
John. Smith declares that McCabe
was not in a position to know that
there was a shortage. Smith says that
the money was paid by his brother
James, who raised it among friends.
and that all McCabe had to do in the
matter was to credit the moneys
turned into the city treasury for the
taxes. When the time came for the
settlement to be made with the Treas
urer the money was produced.
Another reason advanced why there
age is that the records of the Treas
urer's Office show only one receipt or
deposit tag for the $4,000 alleged to
have been paid to satisfy the balance
due on the shortage, while there is
no receipt for the balance of the
money. The entire transaction is ex-
planned by John Smith as follows:
My brother Edwards idea in April. 1904.
was that he was S91 600 short He had de-
posted checks in various banks to his own
ar,A 6roxr- col fbG
checks to suit his convenience When the
time came for settlement to be made with
the City Treasurer he figured up that he had
but $1,000 in cash. leaving sS1. 900 to be made
good. James gave him $4,000 at once toward
the shortage, which left the amount $4,000.
BROTHER TO THE RESCUE.
When he went to James and confessed the
latter agreed to help him out and drew $4,000
made check for the amount payable to Ed
ward ]. Smith Then James went to friends
made out another check for the last amount
Edward took the two checks to his bank where
check for $4,000 on the bank and the cash
delivered to the City Treasurer In my
presence.
everything was settled when George Varcoe,
accountant In the tax Office came to us and
said that he had made a clerical error in
Ssh 900 by making a duplicate entry in the
cash ledger. The amount had been entered on
again entered the next day. We were
dumfounded. as 1t meant that there was still
SS4, 600 70 account for
my God, /" said Edward II have no such
amount of money. What shall do?''
Then James came to the rescue again. say
ing; 4 will see you through this"
James secured additional SS4 600 from
friends and made out certified check pay
able to E. J. Smith The check deposited
check for the amount, payable to John E. Nc
Dougaid City Trea surer. the check being there
fact that check was deposited with the
Treasurer was made the reason for an indi-
vidSa deposit tag but the - s7s 600 paid in
deposits Of that day. That Is why there ap-
pears to be no record Of the payment Of the
$40, 900 in the Treasurers office, nor of the
$1,000 first advanced by James.
BIG SUM IN BANK.
On the other hand, it is claimed
that when the time for settlement
came on May f8, 1904, there was an
actual shortage of but $4,000 or $4,000.
On that day 1t Is alleged between
$500, 900 and 5000, 900 was delivered to
the Treasurer's Office that had been
on deposit in the American National
Bank for two or three months. The
money had been allowed to accumu-
late by Edward Smith as the result
of cashing checks paid for taxes dur
ing that period. A significant circum-.
stance in connection with the matter
Is that James B. Smith is a director in
the bank named. The money properly
belonged in the city treasury, as under
the law all moneys paid for taxes
shall be deposited in the treasury
within twenty-four hours after col
lection.
An impression has gone forth that
the clerks and deputies In the tax Of
flee are mixed UP in the misdoings of
Tax Collector Smith. Such Is far from
being the case. Had they not been
faithful 1t would have been possible
for them to join in the irregularities
in the office without any fear of per-
sonal detection. The clerks have rea-
son to think harshly of Smith, as he
so manipulated the expenditures for
extra clerk hire that they lost their
salaries for one month last year and
had to sue the city to obtain their