New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1907-09-06

tiers about which you ask fully As auditor Of
the marlborough Rapid Transit Company
accept the responsibility of seeing that the
books are properly kept, and believe they
have been II is the fact that at no time did
ever receive any instructions from you IN re-
gard to the character or caption OF the accounts
OF the company, or with regard 70 charging the
items under discussion in any such accounts
REASONS FOR SALARY ENTRIES,
ny. Gaynor then gave long account Of the
reasons why ne entered MI Bryans and Nj
Beiront's sniaries on the subway equipment
account. he next explained each entry that
caused discussion and criticism, including that
Of the contribution 10 the National Civic Fed
GRAFTON.
Atr Beinont's letter to Chairman WILCOX OF
tbs commission in part:
Al the hearing of the commission heiG on the
2ls1 Of August last certain testimony was given
relative 20 the subway equipment account Of the
snterborougn Rapid Transit Company. when
mas created q general Misrepresentation as TO the
purposes and effects OF certain entries IN that
account
The ACCOMMODATING correspondence MAKES
clear the following considerations with respect
this account
First-rhst under no circumstances co1 tI,e
these entries affect either the price which me
city should ultimately pay as the reaSohanle
value OF The equipment OF the lnterboroush
Rapid Transit Company upon the termination
q tie lease CT Ife amount Of bonds which the
t5=y would be called upon TO issue for corstruc-
So. &c re subway or Improperly diminish
-z,,-,- which, eurin, the FIST ten years of the
lease t.le contractor might make as a contrlpu-
tiol toward the sinking fund upon the bonos-
1t also appears from this correspondence that
portions IF the salaries Ct certain officers enc
rhe amounts pad to August Seimon- d 20
have been properly charged -,
Il also appears that great lhJuStice hdS - 80
done by the creation Of the impression ina
August Belmont & Co. received St. h. d
commission upon the issue Of Sl5ete'o neF
cent ffree-y-ear gold notes Of tire nterborough
Rapid Transit Company This amount repre-
SCENTS a discount of : Der cent which the com
rsnv was Obliged to allow in 7isposing Of tn
s15nnaoao Of notes az %, end was nov an
amount charged, or in any sense p9o prop =,
such sums were either charged against or Pc.
70 August Belmont & &C; II also appears 1 ti1-
a commission Of $1,000 in connection with the
sale Of SIona0naa Of these notes that upon ms
SFoNaaaeN Of notes and the 100000 Of notes
3 commission OF three-quarters OF pc!
only vas paid. and that sum was distributes
RANKING houses of which August Belmont &
Co were one, connected with the pubic ISSUE
of the notes. with the result thar AugIst 90
mont & Co received in all o1t OF such COT 81
resion the two sums If $4,000 on the o sly n5.o
10000 Of notes and So: zoo 90. on the S9"'''7''
O. notes making in all S3EfFt =
crIffrier+ req sons are also given for the
charge IF the cast Of the souvenir prh-lcatlon
and Of the contribution by thu company 70 the
National civic Federation the subway equip
1,ent account
an convinced that you will he satisfied
else that the $4,000 paid in connection with
the acquisition of the Manhattan lease was a
proper charge 20 that account
After the correspondence had been read Mr.
wins said that he woulG put MI Gaynor on
the stand later.
The question resolves Itself" he added, int
one as to where these companies should charge
up their discounts. There has been no uniform
system of bookkeeping among them. and 1t is
the duty Of this commission TO decide on one
and see that IL is established
Mr.. WINS then had read the three agreements
The first was entered into by the Metropolitan
Securities Company with the Interborough-Met-
ropolitan Company; the second by the New
York City Railway Company with the Metro
potan Securities Company; the third by the
Metropolitan Street Railway Company with the
New York City Railway Company
The three provide for perfect maze Of fnan-
cIal operations that, to summarize, materially
affect the se9-year lease of the Metropolitan
Street Railway Company TO the New York City
Railway Company
After they had been entered on the record
Mr.. WINS regaled his auditors with the reading
= Of sections Of the Penal Code that he thought
might apply 10 the evidence he had brought out
He seemed TO be strongly impressed with the
belief that officials of the merger had thrown
themselves open to criminal prosecution an
eventually said that he would call the attention
Of Mr. Jerome 10 the evidence, and intinatec
strongly that he would find cause for bringing
~ actions.
ID Mr.. Root was then called to the stand Aftel
answering the usual preliminary questions h
SAID he did not own stock in the metropolitan
Street Railway Company when he was appoint
ed a director Of It. He said he voted for the
eseyear lease and thought he had read il owe
before voting for its adoption He also said h,