The New York herald., 1922-01-25
TWOARRESTEDHERE
INU.S.FUR TAXPLOT
NETTING 100000
Indictment of Fifty Com
panies to Follow, Say Gov
elnment Agents.
FAKE RECEIPT IS USED
Confessed Briber, Ex-Fed-
eral Employee Awaiting
Sentence, Is Held.
BAIL is SET AT $4,000
Five Concerns Accused of Evad-
ing Payment Of $138,0OO
by Fraud.
BAIL IS SET AT $4,000

A conspiracy by which It is charged
the Government has been robbed Of al
least 100000 in taxes on furs in the
last year was disclosed tere yesterday
by United States officers. Morris
Rosenblum. a former internal revenue
inspector. and Herman Schuss were
arrested and fifty New York fur deal
ers are accused in the plot.
Rosenblum was dismissed from the
Federal service in June, 1919. when he
pleaded guilty Of accepting a bribe OF
$4,000 for taking part in an income
tax fraud. He was released on bail
and since has been awaiting sentence.
In 1919 his address was Rockwaay
Beach. where he lived modestly with
his family.
He and Schuss were arrested yes
terday in an uptown hotel. where
they occupied large separate suites
Each kept an expensive automobile
and a chauffeur.
For about year William B. Robin
son, special agent OF the Internal Reve-
rue Department, has conducted an in.
vestigation of the fur trade. About 1000
manufacturing furricrs are In this city
and all are obliged by law to make
monthly returns and pay a 10 per cent
tax on sales. In some cases the tax
runs as high as $4,000 a month for one
furrier.
ForSins Of Receipts Charged.
The investigators charge that Rosen.
blum and Schvss had a duplicate rubber
stamp, with which, 1t Is alleged, they
forged receipted tax returns. The dis
honest furriers are charged with evad.
ing tax collectors by showing fake re-
ceipts. The stamp reads Received
rayment Internal Revenue. Second Dis
trict. New York. Cashier No. q" and
date.
The indictment OF about fifty fur man
ufacturers for conspiracy to defraud is
expected. Elmer l.. Trey. chief OF the
special intelligence unit Of the Depart
ment OF Justice. and Hugh McQuillan
of the intelligence unit are collecting evil
dence.
David v. Cahill, assistant United
States Attorney. said In the specific case
OF five furriers the Government had been
defrauded OF S13s.000, and for that rca-
son he asked heavy bail when Rosen-
blum and Schuss were arraigned before
United States Commissioner Hitchcock.
Commissioners Hitchcock fixed bail at
$4,000 In each case. Hearing was set
for February.
The complaint, made by Robinson,
charges defendants with organizing the
conspiracy on January /. 1921. and con-
tinuing 1t until their arrest yesterday.
Large Sums Involved.
1T was part OF the conspiracy" Rob-
inson said. FOR the defendants to collect
large sums from various fur manufac-
turers In exchange for receipts purport-
Ing to be receipts from the collector OF
internal revenue for this district"
Rosenblum and Schuss are charged
specifically with delivering on Novem-
ber 80. 1921, to Weiss 4 Cooperman.
furriers. 147 West Twenty-hfth street,
a fraudulent receipt for sales taxes
amounting 10 si,420.90.
Records In the United States Attor-
ney's office show that Rosenblum was
indicted In 1919 with Morris s. Rachmil
and Abraham Lincoln Samuelson, pub
lie accountants. for attempting to de-
fraud the Government of income taxes
due from the Coastwise Warehouse Com
pany and about dozen other corpora
tons
Rachmil was found guilty and sem
fenced to six months in prison. Samuel
son was acquitted. Roscnblum, al
though he pleaded guilty. was released
on $500 ball and because the Govern
ment used him as witness against the
others his sentence has been postponcd.