The citizen-Republican. (Scotland, Bon Homme County, S.D.) 1???-19??, 1908-02-20
PROSECUTE SOUTHERN
PACIFIC FOR REBATING

Washington, Feb. 1S.-Prasecutions are
10 be instituted by the government against
che Southern Pacific company and against
certain officials OF that railway organiza-
ton on allegations that they paid rebates
60 shippers.
Information which is the basis Of the
prosecutions was obtained by K.
Lane, of the Interstate Commerce COM
mission, last autumn in the course of an
extensive inquiry made by him into the
affairs of the Southern Pecific ompan
BY direction of the Interstate Commerce.
commission, Commissioner Lane visited
the Pacific coast. and for several weeks
conducted his inquiries into the alleged
charges OF rebating which had reached
the commission.
In the course of his report Commissioner
Lane says that his inquiry was conducted
IN San Francisco, on the I'd, Sd and 4th
days of October, 1907. and that from the
evidence adduced he finds:
The existence of an extensive system OF
preferential rates granted certain ship
pers on Interstate business by the South
ern Pacific company.
The record discloses a list of los firms,
corportions and individuals who enjoyed
what are known as special inside rates.
less than the rates published to the gem
erai public-on the movement OF certain
designated traffic between points within
the state OF California.
That shippers paid the full published
rate IN the first Instance and were allowed
the refund on claims which went through
the auditing department under instruc-
tons fror: the traffic department, that
such special rates should apply upon in
terstate shipments without tariff auth
GRITTY.
That such refunds amount in various
months of the years 1906 and 1907 to from
$oO,VO to $50. COO per month.
mat such refunds given to one arm
period from April. 1896 (the date Of the San
Francisco fire, when all previous records
were destroyed. to September "a, 1907. and
AMOUNT from $1s. ESQ to H,2
That such refunds or discounts from the
regular rates have been continued for a
hearing in October, 1907.
That many Of such state shippers to
large interstate shippers.
Many Of the shippers admitted at the
nearing that the granting of such inside
rate on the state movement influenced the
routing of subsequent interstate shipment
OF such traffic over the rails of the South
ern Pacific
In one instance the general freight agent
OF the Southern Pacific company provided
by voucher, dated July 81, 1906, for the
payment to an interstate shipper Of one
half on the local rate. which such shipper
mad paid to another railroad from the
point OF origin to a Southern Pacific ter
Inlnal, where the traffic began its inter-
state journey over the Southern Pacific
lines.
That there existed for years an under
standing between the Southern Pacific
company and the Santa Fe company and
certain shippers OF dried fruit that traffic
which moved into points of concentration
for transcontinental shipments should be
entitled to a refund st the end of a ship
ping season of one-half of the local state
rate charged at the time of the original
movement.
That the voucher hocks containing the
so called refunds On state shipments also
contained records Of refunds given upon
Interstate shipments.
That some of such refunds upon inter
state were paid by special d.
rection of freight officials after the claims
had been denied by the auditing depart
ment.
The justification offered by the officials
and representatives of the Southern Pa
cifie company for the practices revealed
was that in general they were made neces-
sary to secure traffic which shippers
would move otherwise were such rebates
not granted.
In view Of the foregoing it is directed
that a copy of the transcript of the tes-
ttmony in this matter be forwarded to the
districts attorneys of the United States for
the several judicial districts wherein Of
lenses against the act to regulate COM
merce was committed as shown by this
record, and that such officials be request
ed to institute such prosecutions under
tEe law as may be warranted.