New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-04-26
FIND RAILROADS LOSE
HEAVILY BY EGG FRAUDS
Experts Report to Federal
Prosecutor That Damage
Claims Exceed Breakage.
GRAND JURY TO GET BOOKS
Dealers Connive with Inspectors
10 Mulct Railroads of Large
Sums, Investigation
Thus Far Shows.

., The books of about seventy wholesale
egg dealers in this city have been sub
p0naed by the federal grand jury in an
investigation of claims made against the
railroads for damage done to eggs in
shipment The investigation is based on
reports Of organized fraud in the collec-
ton Of damages.
Experts have been examining the books
OF various firms since last November. with
particular reference TO records Of claims
FOR loss filed with the railroads and
memoranda OF actual damages. The I'M
easiness which this caused on the floor OF
the Produce Exchange reached a climax
yesterday when it was learned that
Henry :. Cutler, Assistant United States
District Attorney. had begun to lay the
evidence before the grand jury
Dishonest egg merchants have been
able 10 collect large sums from the rail
roads through the connivance Of the rail-
road inspectors. il Is understood. The
inspectors are said to have allowed claims
as high as 50 per cent in excess of actual
damage to shipments. one railroad is
reported to have lost $4,000 over and
ebOye its freight receipts for egg ship
mcnts during the last year I'm payment
of damage claims.
Among the firms which have been sum
moned to lay their records open to the
grand jury are Scarborough. Adams q
Co. No 10 Harrison street; the Winfield
H. Mapes Company. No. Il Harrison
street: r. b. Sinner d Co, No. S26 Wash
inton street. and the J. W. Meloney Com
pany. Harrison and Greenwich streets.
four of the largest dealers in the city.
4 representative of one OF them said
Yesterday afternoon that the railroads
had been kicking for some time over
the size Of the damage claims. maintain
ing that they generally lost I'm the long
run on the transportation Of eggs. lie
asserted. however. that the roads handled
eggs with the utmost nonchalance, and
that hardly shipment came in which
had not suffered severely on the way.
Most of the eggs came from the West
and South, ne said, over the Pennsyl-
vania. New York Central. Baltimore 4
Ohio and other trunk lines 1t was said
at the New York Central Offices yester-
day that the road had long been aware
Of the practice Of overvaluing the dam
age done to shipments. but had found
difficulty in getting at the source Of the
trouble None of the railroads would ad-
nit that it had been instrumental in
bringing the matter to the attention of
the United States District Attorney.
4 member of a commission firm in the
city said Yesterday afternoon that he had
personal knowledge Of cases in which
other dealers had padded their claims
against the railroads excessively. The
system in vogue enables the dealer re-
ceiving a shipment TO have the cases
opened and examined in the presence of
railroad inspector. 1t had been found
comparatively simple matter, he said, to
persuade number Of inspectors to certify
that far more damage had been done TO
the eggs than appeared on the surface,
provided they were assured of a certain
percentage Of the gains thus obtained.
Honest dealers. who had long felt the
unfair competition of this process. we're
ready TO give every assistance in their
power to stamp it out. according to the
dealer quoted. Besides being a plain case
Of bribery, if proved. the act is I'm direct
violation of the United States statute of
February 4. 1851 Great hope is expressed
that the federal investigation means the
end of a graft which has been demoraliz-
ing the egg trade for number of years