South Bend news-times. (South Bend, Ind.) 1913-1938, 1921-06-30
PROBE GRAFT IN
REVENUE OFFICES
Reports Reach Secretary Mel
lon That Several Officers
Have Accepted Brides.

WASHINGTON, d. c., June Is
Charges that former officials of the
United States internal revenue bu-
reau are collecting huge sums in
graft through use Of confidential in
formation they secured in the gov
eminent service, are being investi-
gated by Secretary OF Treasury Mel
lon.
Special attention is being given to
accusations that while these persons
were i'm the government service they
secured lists containing the names
of taxpayers against whom the gov
eminent had claims for large sums
Of unpaid or underpaid taxes asd
then offered their services on rep
resentation that they could save
these taxpayers thousands of dol
lars
The systematic and nationwide
method by which these persons have
operated I'm effect is a conspiracy 1t
Is charged, whereby taxpayers have
been buIldozed and blackmailed into
paying enormous amounts and the
government has been deprived Of
millions Of dollars in taxes.
Taxpayers Affected.
Taxpayers are alleged to have
been approached by so-called tax
experts" who formerly held respOn-
sible positions in the revenue bu-
reau. Claiming to have influence
with the United States treasury Of
fcials they represent themselves as
able to secure great reductions in
taxes. 1t is said that some OF the
taxpayers thus approached have
paid from 50 to so per cent OF the
amount Of the reduction to these
self-styled experts. The fees in some
cases run as high as $4,000.
Solicitors who have approached
taxpayers in several cases have fore
casted exactly what the special as
sessments or penalties would be.
This showed there had been a leak
in the revenue collection depart
ment.
A typical instance cited is that of
the head of an oil company in Kan
sas. which paid $21.O to one Of
these experts from an unexpected
assessment of $4,000. The com
pany's holdings were sold IN 1917
and the proceeds disbursed among
the stockholders except $4,000.
which was deposited to pay the In
come tax. The assessment was $780,
600. This caused dismay and con-
sternation.
Make Proposal.
A man approached the head of
the company and suggested that a
certain attorney in washington had
influence and could help him on a
basis Of so per cent commission on
whatever reduction he might secure.
The oil man proposed that the at
torney take all he could save of the
S26.000 If he could get the tax re-
duced from $76.0O to less than
$4,000. A contract was entered
into on the basis suggested by the
oil man. The tax was reduced 20
$4,000 and the balance OF $4,000
went 70 the attorney.
shortly after the turnover in the
national administration last March
number Of experts and officials OF
the revenue bureau set themselves
up in Washington as tax experts. %
Ii was rumOred then that some Of
them had confidential lists which
they intended 10 use in lining I'D
business and pulling down huge fees
from delinquent or penalized tax
payers.
Secretary Mellon has secret serv-
fee men gathering information in
connection with the charges. In the
meantime many members Of the
enate and the house are demanding
n congressional investigation.