New-York tribune., 1919-09-30
Said to Have Suggested to In
jured Man That He Apply,
Examined Him. Then Got
Part of Money Received
System Told at Hearing
Workers Advised to Sav
They Wanted Lump Sums
So They Could Buy Farms

New disclosures Of graft in the man.
agement of the s5,500,o0o state insur-
ance fund by the State Industrial Com
mission were made yesterday before
Jeremiah F. Connor's special investi-
eating committee. Witnesses called tx
the stand at the hearing in the rooms
Of the Board of Estimate told how they
had divided with employees Of the state
sums of money awarded them for in.
juries.
Some of the things testified to BY
various witnesses we're:
Clerks, claim adJusters and medi-
ca! examiners IN the commissions
Office were in the habit of getting
"rake-off" of about one-third Of the
awards. One clerk alone partci-
peted in sixty nine such "rake-offs
and knew Of ninety four other cases
where the beneficiary had to divide
with the officials.
Injured workmen entitled to COM
pensation were urged to ask for
"lump sums" in the adjustment Of
their claims, instead Of weekly al
lowances, so that the commissions
employees could get their "rake-off
promptly.
Claimants were coached aa to how
to act when appearing before the
medical examiners, so that their al
lowances would be boosted. They
were also urged to say they wanted
to buy farms 80 the lump sums"
would be Forthcoming.
One medical examiner, whose name
was withheld because he has since
died, suggested to an injured work
man that he could get insurance.
afterward examined the man and
later shared in his allowance.
Herman on the Stand
How the money was divided was ex-
planned by William A. Herman, a claim
adjuster for the commission. who con
fessed some time ago to District At
torney Swami. Herman appeared on
the stand after a number of witnesses
had testified how out Of money paid
them for awards for injuries they had
given sums to the commissions en-
ployes. Herman enumerated 1868 cases
in which graft money had been paid
He said he had received money from
eixty-nine cases. The total graft in
which he shared with Frank j. Ell
wood, Harry Jacobs and Barney Way
neck, employees of the commission, he
testified, was S13.390. The "rake-off'
in each case varied from $50 to $1,000
but usually was above 5000 and under
$500.
How was the money divided?" asked d
Miles NJ. Dawson. examining counsel
for the committee.
at was divided equally among those
who were in on it," replied Herman
of the amount We got was 81 900
somebody went with the claimant until
h. = ;r ~
from him. Then we divided 1t equally
In the case OF the medical examiner
who induced an injured workman to
make claim, the man collected $500
He gave us $3.50. | got $100, Jacobson
got 500 and the examiner got the rest
Afterward the case was reopened and
the claimant got $500 more. He paid
me S75 more and a like amount tc
Jacobson"
Should Have Had s2,321 More
BY accepting lump sum" at the
suggestion Of the commissions en-
ployes instead Of weekly allowances
Leonitas Springstein, 40 Elmhurst Ave.
nue., Elmhurst, l.. L., who had the
fingers OF both hands cut off in an
accident in September, 1918, received
S2.32I less than he would have been
entitled to. He was awarded SIS, 500, he
testified. He gave 81 900 to Ellwood
who was to divide it with Herman
and jacobson, he said. He de-
clared he had been urged to testify
that because OF his helpless condition
he wanted ito buy farm up in Maine
SO lump sum" would be awarded
him.
Corroborating the witness, Herman
testified: "Ellwood was assigned to see
the claimant, urge him to demand a
lump sum and get what money he could
De came back with $3.50, saying he
had to pay 500 to get the mans check
cashed."
Mrs. Elizabeth Watjin, who was with
Springstcin when he obtained his
award. said she complained of Ell
woods charging 81 900 for his work.
III told him Springstein would have
TO work q long time for that much,
she said. "fie explained he had tt
divide 1t up with others"
Hugh Douglas West, sos East Seven
ty-eighth Street, conductor on Tho
Second Avenue surface line. who suf
tered broken hand and internal in
lurles IN July, 1918. received 81 "lum.
sum- OF Sl,665. When he denied h,
mad paid. any graft, Herman took tn,
stand and said he aud jacobson each
got one third of the money.
Denies He Was Coached
west was again called to the stand
no coached you TO say YOU received
All the money awarded YOU without
any or 1T being deducted ~ Mr.. Dawson
asked. West persisted in his dcnial
but admitted he had told the commits
sion he wanted to become a farmer.
kalph Fash. manager of garage
'oid now medical examiner from the
commission had urged him to make =
CLAIM tor an injured eye, and how he
had divided his award with the ex.
amlner.
Following the admission made some
time ago by f. Spencer Baldwin. man.
ager OF the State Insurance Fund. tha,
hc had accepted s3.lOO automobile
from q. +. Wynkoop. head of the Wvn.
koop Service, ll70 Broadway, which is
interested in tho adjustment Of in.
surance claims, Alfred j. Tallev and
Theodore l.. Waugh. assistant distric,
attorneys. announced yesterday tina.
evidence was being presented to the
grand jury. Il was stated that several
officials Of the insurance fund whose
names have not been mentioned NAV
later he involved in the grand Jury
Investigation.
The hearing viii be continued this