New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-11-13
Self-Styled Spy Likely
to Go Free in Black
mail Case
HE SAYS LETTERS
INVOLVE ENVOY
Alleges Ambassador Is in
Stock Syndicate; u. S.
Holds Papers
[From Tho Tribune bureau

tFrom Tho Tribune Bureau
Washington, Nov. 1.-THE German
Embassy, after causing the arrest of
DR.. Armgaard Karl Graves here yes
terday for alleged backmail OF the
Countess Won Bernstorf, will not ap-
pear to press the charge against him
at his hearing Wednesday. As a con-
sequence, Department of Justice Off
cials do not see how he can be held, as
the only witnesses outside the embassy
are government detectives.
1--WE could waive diplomatic immunity
and appear as Witnesses an embassy
official said, "but we are interested only
in obtaining the letters, which are now
in the possession of the Department of
Justice and will, we understand. be
turned over to u.s."
The Department of Justice has made
no arrangements TO deliver the letters
to the embassy. 1t is probable that
they will be turned over to the State
Department for disposition.
Graves is understood to have threat
ened sensational revelations concerning
the embassy's alleged Irregularities II
embassy officials pressed the charge
against him.
DR.. Armgaard Karl Graves. who was
arrested in Washington on Saturday,
charged with attempting to blackmail
Countess Won Bernstorf, wife Of the
German Ambassador, yesterday said the
mysterious letters in the case related
to stock transactions in which the am
bassador and others In the United
States and in Germany are interested.
The international spy" permitted
the inference to be drawn from his
carefully guarded remarks that the
ambassador has made a practice of
utilizing confidential diplomatic infor-
nation to further the interests of a
secret syndicate which has dealt CO.
verify, but proftsbly, in. American
stocks which have been affected by the
war.
The letters, which DR.. Graves asserts
are now in the hands Of United States
agents, appear to be personal commu-
nications Of rather intimate nature
from a German noblewoman to Coun-
tess Won Bernstorff, and nothing more.
However, asserts DR.. Graves, they con-
tain a most ingenious cipher, which,
when translated, reveals the alleged
secret stock trading operations Of the
ambassador and his colleagues.
Willing to Give U. s. Key
DR.. Graves says he is willing to re-
move all doubt from his assertion by
deciding the letters for the benefit Of
the United States Department OF JUS
tice.
at am giving out this information"
he said. "because ! want every one to
know that the report there was any
thing in these letters compromising to
the character Of Countess Won Bern
storr is untrue. The letters are of an
ether nature entirely. and before this
affair is over the German Embassy will
reckon IL as luckless day when was
arrested and this became public. see
the embassy reports may not be pros
ecuted. Good shall never even be
indicted"
DR.. Graves, whose activity as mo-
tion picture scenario writer and lect-
urer may have deceived some rs to his
darker enterprises as spy, arrived in
New York early yesterday and went
directly to his apartments, at 90 West
Sixty-eighth Street, where he was seen
by a Tribune reporter.
Graves will not tell how he came in
possession of the cvuntess's mail. He
denies he stole the letters, as the
charge against HIM alleges, but will
not admit collusion with the couriers
who smuggled the mIssives pas: the
British censor. As for the blackmail
charge, DR.. Graves said he asked Prince
Hatzfeldt, councillor OF the German
Embassy, for $4,000 merely as payment
for the messengers who brought the
missives from Germany.
Says He Asked No Money
az asked for no money for myself"
said DR.. Graves, "only a written state
ment from the German Embassy 10 the
effect that |, Armgaard Karl Graves, on
such and such day had performed a
great service for the embassy. Such a
testimonial | could use to advantage"
"Why," the doctor was asked, wasn't
Prince Hatfield smart enough 20 sup
press the letters II he knew you had
knowledge Of their alleged damaging
contents?"
"Hatzfeldt thought I was bluffing
about deciphering the code. You see,
there are three letters in all. They ap-
pear to be ordinary communications
such as would pass between women.
One OF the letters contains no code
that | could discover. That is the one
took TO Prince Hatzfeldt. ! told him
what | knew of the other letters, and
he thought | was bluffing. They
thought they had a good chance OF
shutting me up once and for all, and
so I was arrested on these preposterous
charges. have been more or less OF
A thorn in the side OF the German
Embassy for quite q while"
The doctor could not be induced to
explain this last statement. He was
a.ksd what was the so-called damaging
Information concealed in the coded let
c.ntinn "A an nagn q ealsn1