The Seattle star. [volume] (Seattle, Wash.) 1899-1947, 1909-03-08
u SENATE VOTES
AGAINST AN
INQUIRY.
Paulhamus Makes Charger
of BlackmaiI Against
Officials.
BY 7. J. DILLON.

luton demanding an tuNehuE1tlun
Of state officers, with particular
reference 10 the insurance depart
ment. az conducted by Sam ".
4 Nichols, present secretary 81 state.
and John n schively
The resolution was offered by
Paulhamus, Of Pierce county, who
said that within four years prior
10 1903 Nichols and schiveIy had
taken over $4,000 from Insurance
companies for which they hays
made no accounting 70 the state.
That THIS WIS barefaced black
mail was openly charged on tho
floor schiyely was classed an a
highwayman. who went into the in
Burauce offices and told the officers
of the companies 10 stand and de-
liver.
The resolution would have carried
had u not been that II Included all
state offices Booth and Nichols q
King would have voted to inyeafi-
gate the insurance department. but
would not vote 70 probe into otherR
Booth. - chairman u the senate
COMMITTEES on insurance. declared
with much heat that this insurance
scandal was the %rottenest In tho
history % the state. and he charac-
torized the Sehlvcly extortions as
pure and simple plackmaiL
PauIhamns, -four times on the
floor. referred 10 Schively az a
blackmailer.
Ruth Of Thursfon came down
from the presidents chair and Plead
"a for schiveiy. asserting thAf tho
newspapers were alone responsible
for the charges THE senators favor
ing the investigation originally had
a promise o. . votes 10 support II.
They lost two under cover and gain
"a two votes. but Nichols and Booth
deserted and the resolution Was
lost. Pauihamua changed mia vote
20 that the resolution win be re-
considered tomorrow.
The Specific Charges.
Following are the specific charges
made IN Pauihsmus resolutions.
That on April is, 1897. Sam H.
Nichols received from the Walia
Walla Fire Insurance company $500
Tor an examination. and that Ga
July - 81 the anne year. they again
received $500 from this company on
which no accounting haa been made
TO the state. The actual expenses
FOR this examination could not have
exceeded $50.
That on July 81, 1897. Schively
demanded that the Washington
Hardware and Implement Dealers
Mutual Fire Insurance association OF
Spokane and the Western Live
stock association of the same city
pay $500 each for an examination
made IN q day. and finally com-
promised on ti00 each The neces-
sary expense for these combinations
could not have exceeded $50.
$50 for SIS Job.
That in 1905. 1905 and 1907
Schively reported 10 examgne the
Guardian Life Insurance company %
Seattle. charging a Tee Of $50. where
as the actual expense could not have
exceeded SIS.
That since 1905. Schiveiy has made
three examinations Of the Seattle
Fire and Marine Association Insur-
hnce company. charging 5000 for the
first and $50 for subsequent exam
nations. whereas the actual expense
In each cas- could not have exceeded
Si5.
That on December 90. 1909.
Schively examined the Columbia
Life and Trust company. af Port
land, Ore, receiving s1so. whereas
the necessary expenses could not
have exceeded $50.
Draws Two Salaries.
That between July and October,
1906. schively. as deputy Insurance
commissioner. drew his regular sal-
airy from the state: hat on July 10.
1905. he was elected trustee ana
president Of the Pacific Live stock
association. and from that time until
October 3, he gave practically all
hts time ana services 20 mat COM
pany receiving a salary OF S2,6s7.ab.
That during an this time the COM
nany vas insolvent and Schively
knew II.
That for four years sam III.
Nichols. az insurance commissioner,
and John IL. sohively, as deputy,
collected from a large number Of in
surance companies at least, money
20 expenses for examin-
ations 10 be made IN tho future,
which examinations have never been
made
That since his election as insur-
ance commissioner. John VI. Nichols
has collected money TO cover exam
nations 90 be hereafter made, such
sum being arbitrary and not for the
purpose Of applying upon any ex-
pense account IN connection with ex-
animation, but purely as arbitrary
charges.
That there are more than $50 In
surancc companies doing business In
the state. and thar an arbitrary fee
has been charged each OF them each
year since their entry into the state.
that there were entered during The
past two years. in addition 10 these
companies, 81 other companies. who
were charged $500 each for exani-
nations, That there were also entered
rs %fraternal Insurance societies
~rauihnmns' Charges.
senator raufnamus MAKES tie fai-
lowing specific charge In the final
paragraph 81 bis resolution;
Upon Information and belief,
charge that the said sam H. Nichols
ana the said John a. SchfNcly have
collected and received, during the
four years preceding January rs.
1909. IN arbitrary demand for the
alleged purpose on paying xpens
In mHklng examinations of Insurance
coWpanips "a sum exceeding sYa 600
Ia excess ot the actual require
"ants"