Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1922-06-21
WHAT DOES LAW AMOUNT TO
AMONG POLITICAL FRIENDS?
Former Treasurer kephart Nonehaiantiy
Admits That He Did as He Pleased,
Regardless Of the Statutes

Regardless OF the Statutes
FTNl1E admissions made on the stand by
Harmon Kephart, former State Treas
urer. and some of his clerks substantiate
ali the charges made about the irregular
handling of State funds in the articles by
Colonel Mccain in this newspaper last
winter.
The transactions with John A. Bell, of
Pittsburgh, in which Mr.. Bell gave to Mr..
Kcphart checks signed in blank, after the
Allegheny County Tax Collector had paid
installments on the taxes due the State
were nonchalanty admitted. The war fund
explanation made last spring was repeated.
and it was admitted that the existence of
the fund was concealed from every one in
the Treasurer's Office save the Treasurer
himself In order to prevent any one from
drawing on the money without his knowl-
edge. But nothing was said which threw
any clear light on the use made Of this
money. There was total of about 81 go
600 involved.
1t is important that the truth be discov-
cred. who, if anybody, had the use of this
money while it was carried in Mr.. Kephart's
secret fund? Why did not the State get
interest on it?
Mr.. Kephart exhibited an amazing COM
p!accncy when he admitted that he disre-
garded the express provisions Of the law
limiting the amount of deposits to be made
in individual banks. The law provides that
no bank may receive a total deposit in excess
of % per cent of its capital and surplus in
an inactive account, and that in no event
hp
vides also that the total of deposits in all
active accounts may not exceed Sc 900 900.
Yet Mr.. Kephnrt said that he had S1O,-
100000 deposited in active accounts and
that he made these deposits on the verbal
advice of Mr.. Schaffer. who was then At
torney General.
He says also that when the deposits in
inactive accounts exceeded the legal limit
Of 100000 he had the sums reduced on the
day before he made his MONTH. report in
order that the report might show that the
law had been obeyed, and the next day he
returned to the banks the original amount
of the deposit. But it was shown by other
witnesses that the money was not withdrawn
from the banks at all, but that a transfer
was made on the books In the Treasurers
for Auditor General Lewis expert account
ants had shown that the report of deposits
made by the Treasurer did not agree with
the reported deposits IN the statements Of
the banks on the corresponding dates
There was deliberate juggling of the ac-
counts in Harrisburg to conceal the fact that
the law was not being obeyed
f,rtk has t. ~. .lo.
were two secret funds. apparently not car
ried on the books, which were used in CASH
ing checks Of various persons in need of
money. 1t was explained that the members
of the Legislature who wished advances on
their salary We're in the habit of drawing
on this fund, but this does not explain one
check Of $4,000 which was cashed, as no
legislator gets a salary of this amount.
The inquiry ought to throw more light on
this fund, and the clerks, who say that they
simply obeyed orders without inQuiring
whether what they were told TO do was legal
or not, ought to be impressed with a realiza-
ton of their personal responsibility for what
they did.
Mr.. Kephart processes to be Indifferent 10
the fact that he disregarded the law limit
ing the amount of deposits TO be made in
banks. His attorney has insisted that he
acted on the theory that be assumed per-
sonal responsibility for his course and that,
provided the State suffered no loss, he was
immune to punishment.
This IS novel contention. 1t has been
assumed that the laws were passed TO make
n repetition of the scandals Of tho QUAY
regime impossible. They were supplement.
tary to the law OF 1860 which made it n
misdemearor for a State officer charged with
the disbursement of public money to profit
in any way whatsoever by th. use Of that
money. Definite and specific limits were
fixed beyond which the State Treasurer
was forbidden TO 90 in dealing with banks,
but Mr.. Kephart intimat"s that so long rs
he WAS willing to assume personal respon.
sibility for disregardng those limits It was
nobody's business.
1t may be that there Is no law under
which this sort Of disregard of the express
directions Of the Legislature can be num-
ishcd. II there Is such n law. Attorney
General Alter doubtless can lind It. But
ii there Is no such law, 4 is the duty of the
Legislature to be elected this fall to bass
one as soon as II assemblies in Harrisburg
in January.