Richmond daily register. (Richmond, Madison County, Ky.) 1917-1978, 1920-01-28
GREAT QUANTITY OF
BOOZE WAS SOLD
By Wathen and Knebelkamp, Ev-
idence Shows, and They Are
Held To Grand Jury

De1kd1np, manager 1Or the Wath-
en- company, were held to the fed
eral grand jury yesterday after
hearing before United States
Commissioner Joseph A. Craft
They are held on charges of vio-
lating the prohibition laws and
prohibition enforcement laws,
failure to place revenue stamps on
the whisky sold and defrauding
the government of revenue tax
Sixteen witnesses were introduc-
ed by the government in the ex-
amining trial of Wathen, at the
conclusion of which Judge Craft
overruled the motion of the de-
Tense asking for dismissal.
According to the testimony in
troduced by the government,
which was uncontroverted by the
defense, who placed no witnesses
on the stand and asked few ques-
tions in cross-examination, $3.50
cases of whisky were transfer
red on January 2 from the r. E.
Wathen distillery, owned by r. E.
Wathen & Company, former
whisky dealers. 1t was shown
that r. E. Wathen & Company
were not licensed to deal in whis-
ky at the time the transfer was
made and that Wathen is the
president and Knebelkamp the
manager of the company.
Various sales of whisky from
the transferred stock, on which
taxes had been paid for "medicin-
al purposes" to the amount OF
$53,742.4S, were proven by former
saloon keepers who purchased
and sold it for beverage purposes.
No revenue stamps were on the
bottles and cases sold; according
to the evidence.
Stories were told by witnesses
of how the whisky was loaded on
trucks at night by the aid of
flashlight carried by a mysterious
man at the Wathen warehouse
whose f7:e could be seen clearly );
of payments to truckmen made in
the dark; of orders to follow
truck with an Ohio license which
led the way to Covington; over
turned trucks, broken bottles and
OF the location of places to which
the whisky found its way in LOU
isville, Covington and Cincinnati.
One contention Of the govern
ment, represented by w. V. Greg
ory, United States district attor-
ney, his assistant, S. NJ. Russell,
and Elwood Hamilton, internal
revenue collector for Kentucky,
was that the collectors office was
defrauded of $1O2, ,5992S revenue
tax, by failure of the defendants
to pay $6.4O on each gallon as tax
for beverage purposes, instead of
$2,20 gallon for medicinal pur-
poses," which they did pay. Ac-
cording to the governments fig
ures, when it took charge OF the
Wathen warehouse, 4,752 cases of
whisky had been sold from the
8,159 alleged to have been trans
ferred by Wathen and Knebel-
kamp leaving 3,40S cases on hand.
The whisky sold at $l20 a case, it
was claimed.
In moving the court for a dis
missal in the case of Wathcn,
counsel for the defense was not in
harmony on one of the statements
made to support the motion
Judge Fulton, of Bardstown, as
sociated with ]. P. Edwards, for
the defense, asked dismissal on
the ground ''that no evidence had
been introduced connecting
Wathen with any of the sales"
There is evidence that the R
E. Wathen Company made sales,
Fulton told the court, but was in.
terrupted by Mr. Edwards with
mo, there isn't" ''Well the
Wathen Company sold it, or Kne-
belkamp, but not Wathen." con
tinued Judge Fulton.
The defense of the accused to
the charge of defrauding the gov:
ernment of tax was revealed by
the contention of Judge Fultor
that since the establishment o
war time prohibition it has beer
illegal for whisky owners to pa,
any tax for withdrawing whisk.
except that for medicinal purpos
es..
"This tax was paid" he said
and it was all we were allowe'
to pay. Mr.. Hamilton has doubt
less had the beverage shaken il
his face, but could not receive
legally. We maintain that ther
was no intent to defraud the gov
ernment of a penny
'sDo you hold that war tim
prohibition repealed the right c
the collector to collect govern
1nent taxes?" asked Mr.. Hamil