New-York tribune., 1911-09-26
FLAGG AND FRIENDS OUT
Ex-TreaSurer Morgan Still Has
Faith. but "WiIl Talk to Wife"
MISS Russo DISAPPEARS
Jared Flagg, Released on His
Brother Ernest's Security,
Talks of Conspiracy"

Daniel y. Morgan, former United states
Treasurer. who was arrested by postofhce
inspectors for conspiracy In the raid on
Jared F1aess 80 per cent brokerage house
was released from the Tombs yesterday
afternoon. The Illinois Surety Company
furnished bond for $1,000. AS Mr.. Morgan
was hurryins TO catch a train for Bridge
port he denied that he had ever been
Flages treasurer
I'm going home 10 talk matters over
with nv wife" he said. The eX-Treasurer
talked with the postofice inspectors after
leaving the Tomhs He told them that as
coon as he could be convinced that Flags
dealings with his customers were fraudu-
lent he would tell all he knew about them
However. his faith in Flsgg was mistaken
when he left the city.
Ernest Flagg. designer Of the Singer
Building, went on the bond of his brother
Jared ~lagg. for 5000 early yesterday
morning. offering as security building at
Nos. 1o9 and i'll East 8oth street in which
he had an equity OF $4,000. lie also fur
nished 5000 bond for Edward Schiller q
Capper.'
The Illinois Surety Company furnished
$1,000 FOR Alvin NJ Higgins. Flaggs law
Schock tho Reformed Church minister
Henry 4. Jackson and Joshua Brown were
admitted to bail.
Scwall Joins Nicely in Ton1os.
r. Tcnryson Nicely the twice bankrupt
Ilfih avenue book publisher. who was one
or Flargs right hand men, remained in the
Tombs i'm default of $1,000. Neely was
joinod hy Elbrdge e. ScwalL of Quogue.
l.ouc Island. Yesterday afternoon. Sewall'
who was cashier for Flag was arrested
about . o'clock as he was boarding a
train i'm the Pennsylvania Station, by Hugh
NcQuIlan. postofcc inspector. He was
taken before Commissioner Gilchrist, in the
federal building. and was held in $4,000.
ScUaU was once connected with Pond
Extract Company. and is wealthy.
Marshal HankeI sent his deputies to
White Plains yesterday with a subpoena
for Miss Madeline Russo secretary TO
Jared Flagcg. but they were unable to find
ler.
She lived with her father, a shoe dealer
of White Plains. at no Cottage avenue.
NV daughter left her home on Friday
last. and I have not seen her since" said
Nlr. Russo II don't know where she is.
be ready 70 testify My daughter IS nine
teen years old. and has been in the employ
Of Mr. FIagg eight months. At first she
received $40 o week. and then she was in
creased 10 Sl2 a week. don't believe
there is any truth I'm the statement OF
FIarr that he is engaged 10 marry my
daughter. ] never heard anything about
It. ! never saw any engagement ring on
1YRI llfp ga
ANYTHING about being engaged 10 Flagg.
Miss Russo. who Is q pretty little blonde,
is believed to have gone to Baltimore TO
visit relatives there.
At the cafe Beaux Arts. sixth avenue
and 4oth street Flagg declared last even
ing that he would start n conspiracy suit
against eight men, and that he had copies
OF seven afldavits which would show that
impropcr influence was brought TO bear
upon Miss Russo. his secretary. by post
Office inspectors.
Broker Will Resign" He Says.
The moment these become public"
Flags shouted, "a prominent member OF
the Consolidated Exchange will resign"
He added he would give $4,000 TO charity
81 any one would prove that his transac-
tons with his customers were not honest.
Bowie & Wilson, lawyers. OF No. 3 Broad
street, were retained yesterday TO petition
for the appointment OF receiver in
Flasg's business. The petition was not
filed in the District Court yesterday. Bowie
& Wilson expressed it that they were
beaten to it" by Flagg. who emerged from
tho Tombs early enough 10 take care of
his bank deposits before his creditors could
organize.
And. besides" the lawyers said, 1T is
mighty hard TO find enough of Flagg's in
yestors who believe they have been duped.
One New York business man who went
I'm for $4,000 couldn't be convinced that his
money was in danger.
Postmaster General Hitchcock took the
FIasg case under personal supervision yes
terday.
The case is one OF the most important
that the Postofice Department has handled
for years" he said. II want 10 express
my qualification 10 the inspection officers
here on the manner in which they have
handled II. II has been done most admira-
bly,. all the postoflce men concerned hsY-
Ing done excellent work"