The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-07-03
-FOUR INDICTED IN
INCOME TAX PROBE
Business Men Accused Of Con-
spiracy to Defraud U. s.
Government.
$4,000 TOTAL INVOLVED
Action of Grand Jury Results
From Inquiry Into Sterling
Company's Activities.

-Four business men were indicted yes
terday by United States Grand jury
on the charge of conspirlng to detraud
the United States out Of income taxes
The Indictments were an outsrowth oil
an investigation that began with the
arrest two weeks ago OF Morris 8. Rach-
mil and A. Lincoln Samuelson OF the
Sterling Accounting Company. and Nor
ris Rosenblum. an Internal revenue IN
spector. More arrests are expected as
the examination OF the books OF many
firms which we're seized in raid on
the office OF the Sterling Company al
366 Fifth avenue. goes on.
Three new indictments were presented
to Judge w. l. Grub. They accused
Isaac Weinstein and Samuel Samuels.
partners dealing in furs at III West
Twenty-seventh street; A. -. Leven-
thai, president and treasurer OF A N
Leventhal q Co.. Inc, furrters at y
West Thirtieth street. and Nathan
Bloom, dealer In woolen goods at "a
West T'wenty-seventh street.
Rachniil, Samuelson and Rosenblum
were each named In the three indict-
ments as parties to the alleged conspir-
acy Bench warrants for all tho defend
ants were issued and sent out Tor SER
vice.
According to Benjamin P. De witt
Assistant United States Attorney. VINO
presented the cases to the Grand Jury,
the Government would have lost $4,000
in income taxes II the alleged conspira-
cies had been successful.
Rachmil and Samualson, public &C
countants. are alleged to have gone to
many firms and proposed scheme to
defraud the Government through the
manipulation OF books 80 as to show
profits greatly reduced. They are alleged
to have explained that the progress OF
fraudulent returns prepared by them
would be facilitated through the internal
revenue offices through their arrange
ment with Rosenblum. whom they rep
resented and who was in position &c
approve their returns
In the case OF Weinstein and Samuels
, Il Is alleged that taxable income of $685.:
ISL for 1918 was reduced to Sl4,634, @
reduction which meant a difference o.
nearly 5000 In the Income tax OF the
Arm.
In the case OF Leventhal II Is alleged
| that a correct return would have made
him liable to a tax OF $33,1S3. The
| fraudulent return made him liable for 9
tax of only $2.l62, II is asserted, the
difference involving loss Of more thar
| $4,000 to the Government.
| Mr.. De Witt gave as an example Of
the alleged manipulation of Leventhal'i
books a fictitious item Of $4,000 cred
| tied to one expense account. He said
| that the firm had $4,000 in Libert,
| bonds, but that this asset was reduced
| to 311, 900 in bonds.
The correct return of Bloom SHOULD
have made him liable to q tax of 3l2500
| according to Mr.. De Witt. The return
he filed made him liable for $50.
Mr.. De Witt said It was the custom o.
the Sterling Company to take the book
of the firms which entered into a con
splracy with them and hold them New
sets of books were substituted in tn,
offices and the figures OF these supported
the false returns filed with the interna
! revenue collectors.