Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1909-04-17
Corporation Accused of Evading Tax
Upon 0leOmargarine.
LARGE AMOUNT IS Involved
Samples Taken by Agents in All
Parts of United States.
GENERAL DENIAL BY ACCUSED
OmciaIs of Cudahy Plants AT Kansas
city and Omaha Deny All
knowledge of Any
WronEdoIng.

TOPEKA, Kan, April 16.-Charged With
deftauding the government by violations OF
the internal revenue laws, an indictment
was formally returned against the Cudahy
Packing company of Kansas City, kan.'
in the United States district court here
today.
The company is indicted on sos counts.
The officers of the company will be sum-
moned to appear in court and defend the
charges outlined in the indictment
The grand jury was dismissed following
the return of the indictment.
The Cudahy Packing company of Kansas
CITY was indicted on the charge of whole
sale violations of the United states inter-
nal revenue laws. The charge is that the
company has defrauded the government out
of over $4,000 in revenues on oleomargarine.
The revenue law provides that each pound
of uncolored olemargarine must bear
revenue stamp of a quarter of cent, but
that each pound of which coloring matter
has been added to give it the appearance
of butter. 1O-cent revenue stamp must
be attached.
1t is charged in the indictments that the
Cudahy company has sold the colored
product under the quarter of cent tax
and consequently has defrauded the gov
eminent out OF large sums.
Inspectors have been working on the
case several months and have secured
samples sold in towns and cities from New
York to Seattle and from Duluth to jack
sonvilIe These were forwarded to the
government chemist. who reported that
every sample contained coloring matter.
and this evidence was turned over to Dis
trict Attorney H. ]. Bone Of Topeka. who
o,th ha ~
Every sample now in the hands of tho
government experts bears the Identification
mark OF the inspector who purchased IT,
as we'll as the analysis, which shows that
1t contains coloring matter.
II Is claimed by the government officials
that The Cudahy company has succeeded
In monopolizing the oieomargsrine market
by selling the colored product and paying
the tax on the basis of uncolored, there
being difference of 9A cents per pound.
By this means, II is claimed, they were
enabled to undersell other manufacturers
and control the market.
District Attorney Bone declared today
that in addition to the criminal action, he
would bring a civil action against the
company to have the plant and machinery
used in the manufacture of oleomargarine
confiscated.
Large Amount Involved.
WASHINGTON, April 16.-Internal rev.
enue officials expressed no surprise at
the announcement that the Cudahy Pack
| ing company had been indicted at Topeka.
Kan. for frauds against the internal
| revenue laws.
| II was admitted that the oleomargarine
business of the company had been un-
der observation and investigation by
| treasury agents for three months or
longer
! 1t was stated that government agents
have examined large number of sam
pies of oleomargarine in many parts of
the country sold by the Cudahy company
and that while II would not be expedient
to estimate the amount of taxes involved
In the alleged frauds. ii is known that
the officials believe IL will be in excess
of $125.000 and possibly a much larger
sum. The penalty provided for violation
of the law is fine of from $500 TO
| $4,000 and imprisonment from six months
to three years for each offense.
Cudhhy OmcIaIs Deny Charges.
| KANSAS CITY. Mo. April 16.-"I know
nothing whatever of any indictments
that may have been returned against the
company" j. II. Hale, general superin-
| tendent OF the Cudahy plant in this city,
said when told of the action of the fed
eral grand jury at Topeka today. II
don't know that the company has violated
any federal law with regard to the la
beling of goods sent out from this plant. +"
j. e. Wagner, another official. said:
| IF we have violated an internal reve-
nue. law we are not aware OF 1t. There
is evidently mistake somewhere"