The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1910-04-05
Liquor Dealer Charged
With Defrauding Fed
eral Government.
CLAIM ED THAT
NO TAX WAS PAID
Indictment, Which Comes Unex
pectedly, Contains 119 Counts.
System by Which Alleged
Crime Was Committed
Found After Long
Search.

Bringing to light what revenue on |
GERS term the greatest system ever de-
vised In Virginia to defraud the Gov
ernment out OF the taxes on distilled
spirits, an Indictment, including 1i3
counts, was brought in yesterday aft !
ernoon at $3.50 o'clock by the grand
jury OF the United States District
Court against the Phil G. Kelly Com
pany Incorporated. OF Richmond. In
each of ia counts the allegation is
that the Richmond rectiher and retail
liquor dealer received various qtanti-
ties os whiskey, on which the tax
had not been paid. without making en-
tries as required BY the statutes
Three OF the remaining counts al
lcge that quantities OF the Illicit pro-
duct were transferred contrary TO
law to Mcclure c. sullivan, retailers.
while the last two specify that the
Phil G. Kelly Company. Incorporated,
accepted 2o.soo gallons of whiskey
from the Darhytown Distiliery. OF
Henrico county, well knowing that the
tax had not hecr paid
Mnde searching Inquiry.
These so-called sensational develop
ments are said to have followed mi
mute Investigations. made largely
since last October. by Revenue Agent
william II. Chapman, Deputy Agent c.
2, Carter and Special Employes sam
uel +. Chapman and Michael j. En-
right. OF the revenue service.
Although few details of the opera
tions of the revenue men in their cf-
forts to secure evidence enough to-
warrant the asking of the Indictment
is contained in the document pee
sented before Judge Edmund Waddill,
Jr, It is understood that the reve-
r,ifit rl1o0 has bepn ~
stantly on the ground, both al the
dist!llery, or distilleries, and al the
point of destination and 1t is claimed
that various wagon loads of unstamp-
ed whiskey have been traced directly
into the city from the distillery, and
thence to the store of the Kelly Com
pany.
BY certain of those interested in the
case for the government the action
taken yesterday is spoken of as an
entering wedge into more sensational
developments. which may include int
vestigations of distilleries and of
other retailers who are aiieged to
have perfected system Just as COM
plete as that alleged to have been
operated 10 advantage by the Kelly
Company; but of other legal action,
none OF the revenue men or govern
ment employees wiS talk. Their only
reply to queries is that enormous vio-
lations have been carried on. and that
the introduction of evidence at the
time of trial is the only way by which
all the various phases of the alleged
schemes can be explained. It is hard-
" probable, however, that any other
Indictments will be made at this term
OF the United States District Court, but
1t Is probable that a hearing on the
indictment against the Kelly Com
pany will be had before the present
term OF court concludes.
Makes Damaging Charge.
The indictment, which is said to be
the longest legal document ever pre-
sented for the consideration OF grand
Jury of the United States District
Court for the Eastern District of Vir-
ginia. was prepared by Assistant Unit
ed States District Attorney Talley,
who sat with the grand Jurors during
the three hours in which evidence was
being taken.
Mr.. Talley said later that he is not
at liberty to discuss the nature OF the
evidence presented, but he did not at
tempt to minimize the Importance OF
the impending action, nor to belittle
the activity and vigilance of the off,
GERS, who through months of diligent
service have CLEANED what seems to
be an unbreakable chain OF facts and
circumstances.
The 1lSth count against the Phil G.
Kelly Company. which is probably the
most important alleges that the Phil
G. Kelly Company, Incorporated. is a
rectlfer and that 1t received and pur.
chased 1G,500 gallons Of distilled spir-
its, from August 81, 1909, to Febru-
ary 2S 1910, and caused 1t to be re-
moved from the Darbytown Distillery
to a place other than to the distil-
lery house provided by law, and that
1t knew and had reasons to believe
that the tax had not been paid. BY
certain of those Interested In prose
cutting the alleged violator, the
charges contained in the last two
counts are openly referred to as a
conspiracy to defraud.
Tax Was Not Paid.
The final count of the voluminous
document alleges that the Phil g.
Kelly Company purchased received
and rectifed 5000 gallons of whiskes
between March 1. 1910, and March 20
1910. from the Darbytown Distillery
knowing and having reasons to believe
that the tax had not been paid. This
115th alleges that the Phil G.. Kelly
Company. Incorporated, charged to It,
self for retail certain packages bear.
ing its rectifer's stamp, when, In fact
the packages we're not charged to and
used by the Phil q. Kelly Company
hut We're sent to Mcclure & sullivan
Continued on Third Page.)
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