The San Francisco call., 1905-04-28
GRAND JURY
INDICTS ON
TWO COUNTS
Formally Charges
Defaulter With
Felonies.
inquiries Into the Al
legged Shortage
of Sl65,000.

The Grand Jury yesterday found two
separate indictments for felony en-
bezzlement against the defaulting Tax
Collector, Edward J. Smith. One theft
is of $24,378 As, the other of $14,735 03.
This is the tax money of the Southern
Pacific Company, which Smith has mis-
appropriated. A bench warrant was
issued for his arrest.
The Grand Jury assumed complete
charge of the investigation of Tax Col
lector Smiths defalcations. Though
Foreman Andrews started to examine
witnesses at in the morning and the
work of investigation continued till
midnight, no accurate estimate of
Smiths peculations was arrived at At
least $4,000 has been taken, as far as
Expert Young can determine.
The systems of bookkeeping in the
Tax Collectors Office and the Treas
urer's office. according to Andrews
loopholes for bigger stealings than
those of Smith in either office
James McCabe. who has been ap-
pointed to succeed the defaulting Tax
Collector temporarily, informed the
jury that it would be impossible to
find out exactly how much of the
city's money has been taken until all
the delinquent taxes have been heard
from. To do this will take several
weeks. Postal cards will have to be
sent to the owners of property on
which taxes are delinquent. There is
outstanding $4,000.
THE 1880 SHORTAGE.
John Smith, who reported his broth
er's defalcations to the Mayor, was
closely questioned as to the previous
shortage of $165,000 made good by
James B. Smith. Foreman Andrews
and Expert Young were skeptical as
to this story. They maintain that
there is nothing to show that such a
shortage ever existed.
well, it didn't exist said John
Smith. 1T was made good when it
was due Nobody knew about it, but
myself and my two brothers .n7
How was it paid?'p asked Foreman
Andrews.
my brother, James B. Smith, turned
1t oyer in three checks. l don't know
bow my brother, the Tax Collectors
turned it into the treasury, but it was
there when it was needed. It's hazy to
me now. l was just as excited then as
/ am to-day"
Can you get some sort of proof that
a shortage existed and that 1t was
paid?'
Il think so," Smith replied
He was requested to bring the proofs
to the full meeting of the Grand Jury
In Judge Lawlor's court in the evening,
but failed to produce them. Finally he
admitted that he had nothing but the
statements of himself and his brother
to substantiate the story of the first
shortage.
E. Black Ryan, tax attorney for the
Southern Pacific Company, produced
receipts and vouchers for $39, ,113 81,
which he had received from Edward J.
Smith for the company's installments
of taxes The receipts were signed by
Smith and the vouchers were marked
with the receipt stamp of the Tax Col
lector's office and o. KID with the ini
tial S.
F. Knerr, a clerk in the office, pre-
pared the vouchers at Smiths order
and placed the stamp upon them.
Smith attended to the collections him
self. Knerr was called as witness,
but could throw little light on the
transaction. He produced the books on
which the companys taxes still ap-
peared as delinquent.
J. Miller of the License Office told
how Smith had been accustomed to
draw sums of from 5000 to $500 on that
office. A balance sheet countersigned
by Auditor Baehr was introduced on
which 1920 was entered as paid to Ed
ward J. Smith on a tag. This was en-
tered under the head of cash on hand.
Cashier Jackson was closely queS-
toned in regard to the $165,000 trans
action, but declared that he knew
nothing about it. From his answers
Foreman Andrews is inclined to doubt
that the shortage could have reached
that amount. Jackson said that at one
time he thought that there seemed a
possibility of a shortage of $4,000 or
$12, 900, but that it was made up imme-
diately. In fact" he declared. Il can