New Britain herald., 1914-07-08
TWO INDICTED FOR
 DIAMOND SMUGGLING
Big Shipments Of kugg;Is are
 Traced to Montreal.

tIlS 1eucIdi SIdHu Jury yeSIeIudy oli charge of smuggling diamonds into the United States between February 15. 1911, and April l, 1912. The indictment contained eleven counts. The indictments were handed down late yesterday, and it is believed they are the first steps in efforts to bare diamond smuggling plot which in round figures involves $7OO,OOO.
 Suspicious that diamonds were be- ing smuggled into the country was aroused when Joseph Samuels & Son, braid and trimming house, failed several years ago, and 1t became known that firm of pawnbrokers of Montreal, Canada, were indorsers on notes held by the creditors of the Samuels firm. At the time of the failure the total liabilities of the firm were more than s1,O0O,000. Gen. eral A. s. Webb. of the Lincoln Trust company, trustee in bank ruptcy, learned that the only tangible assets of the company were goods and cash totalling about s12,o0O.
 Facts Caused Investigation.
 This fact. coupled with the faii- ure of Herman J. Dietz, whose notes were 1ndorsed by the Samuels firm for a large amount, caused the cus- tom officials to begin an investiga- tion. It developed that when Dietz could not get diamonds in any other way the Samuels firm bought them for him and took his notes in pay ment. The trustees investigation of the Dietz failure made other disclo- sures, and the result of the inquiry was made known to the United States district attorneys office. Tn February, 1913, the grand jury in- dicted members of the Samuels firm and Mrs. Ray Abrahams, who was the sister of two of the members of the firm and a daughter of an other, and, also indicted Isaac Ander- son and Charles Hepner, employees of the firm, and Herman H.. Oppen- heimer, a lawyer.
 Roger B. Wood, assistant United States attorney and Dudley F. Ma lone, collector of the port conferred yesterday on the indictments found by the grand jury and for the first time decided to give statement to the public regarding the governments investigation of the matter. The statement said:
 Tn the month of March, 1914, as the outgrowth of certain bankruptcy cases, it was brought to the atten- tion of Dudley Field Malone, collec- tor of the port, that there were large customs frauds over the Canadian border.
 ''The collector conferred with Rog- CT B. Wood, assistant United States attorney, and made a special trip to Washington to consult with Chief Flynn, of the United States secret ser- Ny3no fnH cd .ly Burke, secret service operative, to the collector for the purpose of this investigation. Since that time the collector and Burke have been busy Investigating the case, both here and in Canada. and 1t is believed that the indictments against Herman J. Dietz and Charles Dietz, which have been handed down today, are merely the first steps in the disclosure of tre- mendous smuggling plot Already the amount of diamonds smuggled and traced reaches approximately $7OO,OO0 and will involve many firms doing business here.
 Trace Big Monthly Shipments.
 During an investigation of the in- voices of the custom house at Mon- treal, Canada, by the secret service OpCIdIlVC, dCl1HS uuuSI INSTRUCTIONS from Collector Malone, it developed that on an average two shipments of diamonds, of a value of about $25,- 900, were monthly smuggled into the United States.
 ''The scheme was that New York diamond firm would order diamonds from Grunezweig & Trimmer. of Ant werp, consigned to pawnbrokers of Montreal. An agent of the snug glers would come on from New York, receive the diamonds in Montreal and take a night train for New York, conceaIing the diamonds on his per- son. On at least a dozen occasions the diamonds were brought into the United States by resident of Canada, who was paid the sum of $50 to $10O for each trip. The diamonds were delivered in New York.
 Indorsed Many Notes.
 When samuels & Co. failed it de- veloped that the pawn brokerage firm was indorser on number of notes held by the creditors of the Samuels firm. It also developed that the Samuels firm held number of notes made by differ ent firms in Montreal and delivered to Samuels by the pawnbrokers. These pawnbrokers and number of the Canadian firms whose notes were held by the creditors of Samuels & Co.,, failed immediately following the Samuels failure.
 Tn March, 1913, Herman J. Dietz went into bankruptcy, with liabilities of over $300,000, and assets of ap- proximately $5,000. After the Dietz 1 failure an investigation was com menced by the United States attorneys office to ascertain whether Dietz had concealed his assets. This nvestiga- ton has not yet been completed.
 New Indictments Threatened.