The Morgan County press. (Wartburg, Tenn.) 1916-1926, 1920-01-30
SEIZE $42,OOO,OO
WORTH OF WH|sKEY
WAREHOUSE OF THE r. G. WA
THEN, TOGETHER WITH $4,000
BARRELS OF WHISKY.
Oldest and Largest DistiIIery in Ken
lucky Seized BY Government Oni-
Gals, Also Head of Concern Arrested
AS Climax Of Two Weeks lnvesti-
cation.
Western Newspaper Union News Service

Western Newspaper Union NEWS SerFiSe
Louisville, Ky-Seizure by Federal
authorities of the warehouse OF the
r. e. Wathen Distillery, on Seventh
street road, one of the oldest and
largest plants in Kentucky, together
with $4,000 barrels of whisky, valued
at S42,GOO,O0O, and the arrest Of II. Il.
Wathen, head of the distillery, ana
w. r. Knebelkamp, it's general man
ager, came as climax to two weeks
investigation into alleged frauds OF
gigantic proportions by Elwood Ham,
iltOn, Collector of Internal Revenue.
The two men were released under
1000 bonds pending their examlna-
ton before Judge JOseph~A. Graft,
United States Commissioner, next
Tuesday. Other Investigations are De-
ing made by agents from the Collec-
tors office, in which the whisky in III
other warehouses throughout the state
is being regauged to determine wheth-
er any of it has been disposed or IL
legally. Should there be indications
that frauds have been committed, the
Collector said, large seizures and SEN
sational arrests will follow the inves-
| tigatiOn.
The warrants for Wathen and Kne-
belkamp charge them with attempting
TO defraud the Government OF the tax
on whisky manufactured for beverage
PURPOSES, of withdrawing whisky from
bond without hay ing proper labels and
| stamps affixed and with transferring
5000 cases of whisky from the distil'
lery of r. e. Wathen to r. e. Wathen
& Co., alleged wholesale whisky deal
] ers, to whom no license to deal in
whisky had been granted. The allega'
ton is made that Eat various times be"
tween January 1 and January Is, 1920,
the accused feloniously defrauded and
ATTEMPTED to defraud the United
States of the whisky tax by transfer
ring from the distillery to Il. e. Wath'
en- & Co. 5000 cases of whisky on
which the tax of 1920 for medicinal
use had been paid, but which was
actually sold for beverage purposes, nj
least in part" The penalties attach
ed to the various violations OF the law
charged are staggering. Evading the
payment of tax results in forfeiture OF
the property involved, in this case
amounting to $4,000, a fine of not
less than $500 nor more than $1,000
and Imprisonment Of from six months
to two years. Double taxation of the
5000 cases specifically mentioned in
the warrant would add $201,6OO.
Violation of wartime prohibition is
punishable by a maximum fine OF
$1,000 and Imprisonment for not more
than one year. Selling liquor without
license, even for medicinal purpose
incurs a penalty of not more than
$1,000 and Imprisonment for not more
than one year. M. G. Bane, division
chief of the internal revenue service
in Kentucky, took official charge OF
the distillery, the entire property Of
the Wathen Distillery passing into
Government possession. A force o.
revenue agents and gaugers is nov
taking an inventory of all the whisk!
on the premises. To complete the tasl
of appraising the property will require
at least two weeks Civil suits of large
proportions will follow in the wake O.
the proceedings, Collector Hamilton
said.