The citizen. (Honesdale, Pa.) 1908-1914, 1910-03-25
Paid by UnderM,ie to
Defeat Strike Bills.
6. W. SHELDON AS COLLECTOR.
Senator Grady's Reinsurance Bill
Bought" Through New York
Legislature and Bargain
Made Not to Repeal 1t.

to State Superintendent Hotchkiss IN
his Investigation Mt his office here in.
dicates that the New York board OF
fire underwriters has been for years
one of the most prolific producers to
the hungry grafterS in the state legis
lature
With the probe barely under the skin
of the scandal it has been shown that
the fire insurance companies in the
board of underwriters of this city
alone paid 100000 to influence legisla
ton in the six years beginning i'm 1901
and ending 1906.
How much more was paid by the
companies of this and other cities and
states and by the casualty companies
Mr.. Hotchkiss intends to show. He
also intends TO show if possible Whc
got the money. 1t would appear from
the revelations so far that the fire in,
surance and casualty and bonding
graft collected 10y the legislators ran
into the hundreds of thousands.
The most important testimony came
in the admission by Emanuel II. \.
Correa, vice president of the Home In.
surance company. of a letter written
by him to J. b. Branch. president of
the Providence Washington Insurance
company. The letter was dated New
York city, July 8. 1905, and in ii MIR,
Correa said:
We had quite an understanding last
year and We're very successful in killing
couple of very serious bills that pre-
sented themselves through the senate OF
this state. and we hope with due dill
gence and exercising every possible eff
fort to properly protect the interests OF
our associates
In regard to the Grady reinsurance act
1t may not be out of place for me to give
you in perfect confidence a statement
that has come to my knowledge and
which l conveyed to the committee (on
laws and legislation) a short time ago
namely, the fact that the Grady bill, hav-
ing been fought through by certain rein
surance companies and having been.
bought through the legislature (the
amount of the purchase even having been
signified TO mel, has been placed upon
the statute books with the absolute and
avowed understanding, promise and CON
tract that the parties who put the bill
through will defend it and take care that
it is not repealed until 1906
When pressed by Mr.. Hotchkiss to
state to whom the money had been
paid for the passage of the Grady bill
and the amount of it Mr.. Correa de
clared that all he meant in his letter
to Mr., Branch was that the represent
atives of the beneficiarieS of the Grady
bill had employed counsel to go to Al
bany and present arguments" for the
measure and that these lawyers were
paid only $1,000.
This Grady reinsurance act still
stands on the statute books. 1t was
put through the legislature of 1904 and
signed by Governor Odel. 1t was in
troduced by Senator Thomas f. Grady
and was backed by only three foreign
reinsurance companies, led by the
Munich and the Rossia 1t was bitter
ly fought by 240 American fire insur-
ance companies.
To defeat that bill they spent $1O,-
900 in vain through George f. Sheldon,
then president of the PheniX of Brook
lyn, and vainy used all of the vast in
fuence at their command to bring
pressure upon assemblymen and sena-
tors. This Grady act was of tremen-
dous benefit to the foreign companies
giving them an advantage reckoned
at 30 per cent over American compa-
nies.
w. y. kremer, president of the Ger
man-American Insurance company and
vice chairman of the laws and legis-
lation committee of the New York
board of fire underwriters in l9OO-1
testified that many strike bills against
insurance companies were introduced
in the Legislature in 1903 and 1904.
The introduction Of memoranda Of
payments made by Mr.. Kremers com
pany during 1904 brought the name of
the late George T. sheldon, president
Of the PheniX (freJ Insurance com
pany of Brooklyn into the proceed
mgs. Mr.. Sheldon died at Greenwich,
Conn. following an exposure Of his
company by Mr.. Hotchkiss.
The payments to Mr.. Sheldon were
listed as follows: April 2S. 1903. $1,000
for legal service; Sept. l, 1904, $500;
Dec. 80, 1904, $500,
do you know what these amounts
were paid forT' was asked
They were additional amounts paid
to Mr.. Sheldon at his request"
do you remember his telling you
for what he used the money" Kremer
was asked
mo, l do not. can only remember
that MIR. Sheldon was collecting a fund
for expenses incurred in connection
with legislation He was acting for
the board of underwriters to defeat
hostile legislation. He ran up "A bill
Of $4,000 for legal expenses"
Mr. Correa of the Home Fire Insur-
ance company, recalled to the stand,
testified that he gave Sheldon $1,000
in two amounts of 81, 800 each.
A receipted bill for $4,000 paid To
the national board of fire underwrit-
Prs on June 3, 1901, was shown TO Mr..
Jorrea. 1t was for services In the re-