New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1911-11-17
RAILROAD MEN INDICTED.
B. & O. and Lehigh Officials
Charged with Giving Rebates.
TWO PLEAD NOT GUILTY
"Forwarders," Who Accepted
Rebate, Also Indicted-13
Named in As Counts.

Indictments against thirteen individuals
were returned yesterday by a federal grand
jury, charging rebating by the Baltimore &
Ohio Railroad Company and the Lehlgh
Valley Railroad Company on freight con-
signed from foreign countries to merchants
In the West
Robert b. Ways, foreign freight agent OF
the Baltimore & Ohio Railroad Company,
was mentioned I'm six of the indictments,
and among those indicted for receiving re-
bates from the Baltimore & Ohio were
Jules Il. Bernard, of Bernard, Judae & Co.,
OF Chicago: Maurice Ascher, Of Gallagher
& Ascher. of Chicago; Oscar +. Kosche.
trading as Charles ID. Stone & Co, of Chi
cago Albert +. eraser, president of the
American Shipping Company. of Chicago.
and August Bontoux, president Of the In
ternational Forwarding Company, Of Chi
cago.
Thomas n. Jarvis. vice-president of the
Lehigh Valley Railroad Company, and
Clarence A. Blood. its freight traffic man
ager were indicted for allowing rebates on
freight transported over the lines of the
company. and George w. Sheldon. presi-
dent. and Henry w. Ackhof. vice-presi-
dent. OF George w. Sheldon & Co, of Chi
cago. were charged with receiving those
rebates.
The investigation which led 10 the indict-
ments was made by John w. II. Grim,
Assistant United States Attorney, on In
formation turned over to the prosecutors
office early in July by the Interstate Com
merce Commission.
The indictments, which contained in all
forty-five counts, were similar in wording
except in the details Of the transactions
complained of. They covered the period
from July /, 1910, until October ], 1911. The
charges were based on the assertion that,
although the consignees paid the full
freight rate for the goods shipped TO them
the railroads RENTED to them amounts rep
resenting 10 per cent of the rates charged.
Mr.. Grim, in explaining the matter to
Judge Martin said that. while the amounts
mentioned in the indictments were small
because only single shipments were con-
cerned. the violation of the law could be
proven in those instances, and that the
investigation had shown that the practice
of Relating on foreign goods shipped west
over the Baltimore Ohio and the Lehigh
Valley had reached great proportions.
Thomas n. Jarvis and Clarence "A. Blooo'
of the Lehigh Valley Railroad Company
entered tentative pleas of not guilty before
Judge Martin, with leave TO Withdraw thelr
Meas before December 4. Judge Martin
fixed bail at $500. which was furnished by
the defendants.
The indictments were based on an IN
vestigation made by the Interstate COM
merce Commission through its division OF
inquiry.
The indictments, according TO the Inter-
state Commerce Commission, rested on the
doctrine that refunds from rates paid 10
nersons controlling routing of shipments
were unlawful rebates, even though the
persons receiving the rebate funds were not
the owners Of the shipments.
"As a matter Of fact" 1t was said yester-
day by a member of the commission IN reI-
erence to the indictments, "all of the re-
cipients Of these payments. instead OF Deins
agents for the carrier for tie solicitation
of traffic. are in reality forwarders. with
their principal Office in the United states
or else employ forwarding agents or
,rokers IN New York City, who act as
agents OF the consignee at Chicago or other
interior points"
II is the contention of the government
that the payments to Sheldon & Co. are 10
a shipper, and such are unlawful, because
3, tho discharge of the obligations OF It's
contract with the real consignee, II Is an
agent of the latter, and therefore cannot
be, under the law, an agent OF the raiiroau
company
It further developed through the inquiry
of the Interstate Commerce Commission
that the tonnage owned by Sheldon q CO.
was very large In order to OBTAIN the
commission on shipments actually owned
by the concern. such shipments were billed
from New York, 1t was said, showing smell
don &, Co. as the consignor, with Henry ID.
Ackhoff. vice-president Of Sheldon Co..
as consignee.