The Washington herald., 1907-06-10
RECALLSBIGSWINDLE.
Suit Resulting from Pension
Fraud Appealed.
PAYMENTS DRAWN ILLEGALLY
Sent to widows who Had
Remarked Are CRshed by AttOr-
ney-Treasury Department Inter
ested in Decision Which May Set
tie Question often BOthersome.

The most extensive and successful
scheme for swindling the Pension Bureau
that has yet come to light is recalled by
an appeal recently filed in the Supreme
Court by the government from a decision
Of the lower court against its efforts 70
recover the loss it sustained.
The pensions Of widows who remarTy
are supposed to stop as soon as the cere-
mony has been performed, but William
A. Munson, a pension attorney OF PrOvi-
dence, r. l., who handled the pension
checks Of numerous clients, failed to
notify the Pension Bureau Of the remar-
riage of one Of them i'm 1884. and for thir
teen years drew her pension himself by
forging her Endorsement on the checks.
As others Of his clients married or died
he added them to his private list by forg-
ing their signatures. until I'm 1897, when his
crime was discovered, they numbered
nineteen, ard he had drawn something
Ike $2OOO0 from the Federal Treasury
by the forgeries
His scheme might have continued much
longer but for an anonymous letter re-
ceived at the Pension Bureau notifying
the officials that one OF the Providence
widows then drawing a pension was not
entitled TO it, because she had remar-
ried. An Inspector sent 20 Providence
found that the information was correct
as far as the second matrimonial venture
was concerned. but that while the checks
had been cashed, the eX-pensiOner had
not received q cent Of them since her
marriage. Finally, the forgery was
traced to Munson. whose operations were
shown TO be so extensive that a general
investigation was made OF the entire dis
trict Of which Boston Is the center.
Many Gases Uncovered.
Fourteen inspectors were engaged for
weeks IN verifying each name on the
invalid-pension roll in the district. and in
addition TO uncovering Munson's opera
tions. they discovered that ll5 widows
who had remarked were still drawing
their pensions, apparently unconscious
that their actions were Illegal. uotwith-
standing they each received a printed no.
tice to that effect on the document which
accompanied the checks each month
When the Investigation Of Muuson' s
peculauons was completed it was found
that in thirteen years OF his Wrongdoiug
he had forged the signatures to several
hundred checks. ranging from 81 10 N5
each. the total amounting 20 nearly Sl1-
CO. He was arrested, convicted. and
sentenced 10 FIVE years Imprisonment In
the Rhode Island Peniteutary. but died
there before serving out his term.
The government then set about recov-
ering the money il had lost through Nun
sons operations. Two OF the Providence
banks that had cashed a portion of the
forged checks, upon demand being made
paid over the amounts claimed. but the
National Exchange Bank OF that city re-
fused on the ground that the government
by falling for six months after the
forgeries were discovered 90 notify 1t Of
the fact had lost the right TO recover
according 20 the rules Of banking.
Suit was then instituted agains, the
bank for $4,000, the total amount OF the
checks il had cashed for Muuson and
the trial court, after holding that the
banks plea of non-lability through the
negligence IN notice was not available as
a defense where no resulting damage was
shown, ordered judgment for 1851. to-
gether with S26S2 interest. rejecting part
OF the claim on techuicallues. The bank
carried an appeal 20 the court of appeals.
which reversed the judgment Of the lower
court and held that the forged instru-
ments were Treasury warrants, which
had exactly the same standing at law as
commercial paper
viii settle Old Question.
While the government appealed from
this decision in an effort to recover the
amount lost in this particular case. the
afiirmance Of the doctrine announced
viii not be entirely unwelcome 20 the
officials Of the Treasury who have charge
Of the enforcement Of the law on checks
issued, for the reason that it will make
clear the liability Of the banks who han
die them, Notwithstanding the new rule
as 10 prompt notice Of forgeries and
other Irregularities.
Considerable sums have already been
lost TO the government through the red
tape methods that formerly prevailed in
such matters. but under rules promulgat-
ed recently this pitfall will probably be
avoided 4 decision by the Supreme