The New York herald., 1921-08-06
MAIL THEFT TRUSTS
SYSTEM REVEALED
Stolen Securities Distributed
Through Small Banks in
Illinois and Wisconsin.

Special Despatch to TIE NEW York HERALD.
CHICAGO. Aug. 5.-Disposal of hun
Greds of thousands Of dollars of stolen
securities by the alleged mail robbery
trust" through small towns in Illinois
and Wisconsin was revealed to-day. ac-
cording TO Fedeis,, authorities, with the
arrest Of Charles w. French, said to be
the principal aid Of John w. Worthing-
+on. Worthngton, according to the
story being checked up by Federal Off
Gals. maintained gigantic system for
the disposal OF the loot of the trust
4 system brsinesslike and efficient
French was arraigned before Judge
Lands to-day At the suggestion of
Iohn V. Clinncn, Assistant District At
torney, he was permitted to furnish his
cwn bail of $1,000. 1t is believed the
bonds We're set so low because French
gave information to the Federal author
tiles concerning the activities OF Worth
ngton. and tina. he will be Govern
ment witness.
French. with his mead in bandage
and both eyes blackened from an auto
mobile accident, was arrested early to-
tel. 1t Is believed the authorities traced
him by following Alva Harschmann
another alleged Worthington aid, who
was released on bonds yesterday after
4.
man named Hawkins, who refused to
give his first name, wera playing cards
in a room adjoining Frenchs when the
arrest was made. Hawkins, who is said
to be bond salesman from Cleveland
is held for questioning. f-satt
According to Col. Clinnen, French
toured Illinois and Wisconsin, establish
ing credits for Worthkarton's Central
Securities Company witt: small banks
He would show evidence OF the firms
extensive dealings with foreign banks
and would obtain loans, leaving alleged
stolen Liberty bonds or other stolen
securities. Later the firm would fail to
meet their obligations or the loans and
the banks would confiscate the securities.
These banks will now lind themselves
with thousands Of dollars worth OF
stolen bonds on their nands, Federal
officials fear.
Arthur NJ Goldsmith private school
principal was questioned for more than
three hours yesterday by Maxwell S.
Mattuck, Assistant United States Attor-
ney, relative to his operations as bond
broker over period OF three years.
Goldsmith admitted having purchased
bonds from John w. Worthlngton, sup
posed head of the mail bond thieves In
Chicago. but denied knowledge that they
were stolen.
Goldsmith, who is out on $4,000 bail
pending extradition to Chicago, went to
the office of Mr.. Mattuck. accompanied
by his attorney, Charles III. Grifflths. of
120 Broadway. He told Mr.. Mattuck
that he had purchased In all about
$4,000 worth of bonds from Worthing
ton, but denied that he had cashed at
Station Y of the New York Post ONCE
a number Of coupons that are said to
have been clipped from the bonds stolen
from the Dearborn Street Station
Goldsmith said Il was his practice
always to change the bonds that came
into his possession. These changes We're
made at the Federal Reserve Bank, he
said. The exchanged bonds then were
turned into cash at the market value
at the brokerage houses. Goldsmith
said.
Goldsmith told Mr.. Mattuck that he
would fight extradition. He promised
Mr.. Mattuck that he would bring his
books to the Federal Building to-day for
examination by Government account
ants.
worthington visited Goldsmith three
times In this city since the Chicago Post
Office robbery on April 6 last. according
to Goldsmith. but at no time during
their conversations was the Chicago rob-
berry mentioned Goldsmith admitted he
had written letters to Worthington,
many of which are In the hands OF the
Chicago police, but he denied that he
ever had correspondcd with Worthing-
ton in code.