The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1905-11-02
The Surety Bond Given by State
Treasurer Kelly.
Paid For by the Beneficiary of
the State Funds.
HE BORROWED s5OO,OOO
How the Money Was Used and
by Whom.
Receivers Want Money Paid by
Devlin for Kelly's Bond.

Charles J. Devlin paid for the
surety bond given by T. T. Kelly, as
state treasurer
The amount paid was $1,000 and the
receivers find that this is an asset Of
the Mt. Carmel Coal company. of which
Devlin was president, and the receivers
propose to collect this amount from
State Treasurer Kelly.
Kelly paid an excessive amount for
his surety bond, because a number of
the companies had refused to issue a
bond for him. They regarded him as
too great a risk.
These facts have been discovered by
the accountants who have been ex-
amining and investigating Devlin's af-
fairs.
| The evidence is clear that Devlin
paid the premium for Mr.. Kelly on
the state treasurer's bond Nothing
| appears to show that Kelly ever re-
! imbursed Mr.. Devlin.
Devlin was also personally on
Kelly's bond. Devlin was handling a.
/ large amount of the states money. A
half million dollars Of it was in the
First National bank. of which Devlin
was the controlling stockr0lder. Dew
lin was the beneficiary who got the
benefit of the states money on deposit
in the First National bank now de-
funct.
A day or so ago. as published in the
State Journal last night, Kelly quietly
put into the state treasury. $1,000.
which is alleged to have been the $1,000
which he. Kelly. spent for his surety
bond and which the legislature appro-
priated for a certain purpose. It was
shown that Kelly had taken this mon
/ ey and taken it wrongfully. even if he
had used it to pay for his bond. After
long delay and much emphasis upon
the part of Governor Hoch, Kelly fine
ally put this money, last Saturday,
back into the treasury.
Here is the history of the way Kelly
got the money to pay for his bond,
given by the Title Guaranty & ust
company, Of Scranton, Pa for $780,
w. E. Thomas, Of Leavenworth, and
lately of the Southwestern Fuel com
pany, was very badly involved in the
Devlin failure. 1t is said that he suf-
fered through Mr.. Devlin several hum
dred thousand dollars loss. He is now
very sick at his home In LeavenwOrth.
He claims, it is understood that he
never got the beneht OF this money,
but that the money borrowed on the
i credit of the Southwestern Fuel com
pany and of Mr.. Thomas went to Dew
Inns business interests other than the
Southwestern Fuel company.
W. E. Thomas acted as the inter-
mediary between Kelly and DeYlin in
securing the 100000 bond required in
addition to the personal bond of $780,
600 signed by Mr.. Devlin himself.
Thomas went to J. H. Rush OF Kan
sas City, No, broker and agent for
sureties companies. Thomas arranged
with Rush to try to secure a surety
bond for Kelly Rush got the bond.
but he had to pay a good price for it,
because other surety companies had
turned the proposition down. The
Scranton company issued the bond, but
the charge made was more than the
| usual one.
Rush was paid for the bond $4,000,
in ten drafts, of $500 each, drawn on
the Pioneer Trust company, of Kansas
City, Mo-; on the American National
bank, of Kansas City, Mo, and on the
City National bank, of Kansas City.
Mo. These drafts were all issued be-
tween January "a and February 2
last and were all signed by c. p. a
IClough.
Part of them were signed by him
personally and part of them as treas
urer of the Kansas City Coal & Coke
company. This latter company was
one of the W. z. Thomas companies.
i Clough was instructed by Thomas to
Issue the drafts and appears to have
had no other connection in the matter.
excepting to do as he was directed in
regard to the issuance of the drafts
OF these drafts 1900 of the amount
was charged to Mr.. Devlin's personal
account; $4,000 was charged to the Mt.
Carmel Coal company's special account.
Mr.. Devlin was president Of this COM
panY.
The Kansas City Coal and Coke com
pany was reimbursed for the $1,000.
paid for the bond by five different
drafts on the Southwestern Fuel com-
pany of $500 each, issued between jan
uary "A and February 3. Mr.. Devlin's
personal account was credited with 81
500 of this amount and 8, 200 was credi-
ted to the Mt. Carmel Coal company's
account.
The Southwestern Fuel company af-
terWards reimb bursed itself by drawing
on the Mt. Carmel Coal company for
s.. Co.,
The receivers now propose to require
7. 7. Kelly to pay the Mt. Carmel Coal
company the amount the coal company
paid for Kelly's bond.