Democratic messenger. [volume] (Snow Hill, Md.) 1869-1973, 1922-05-06
CONGRESS- HEARS
OF BOND FRAUDS
Johnson, Of South Dakota, Says
Hundreds OF Millions Value
Are Duplicated.
CHALLENGED BY Mr.. WINGO
Declares Secretary Ibid Not Lie."
johnson Brings Up Complaints by
Official Ousted Under Former
Administration.

ACKNOWLEDGEMENTS Royal
G. johnson of South Dakota, chairman
OF the committee engaged In investi-
eating war expenditures, asserted In
the house that hundreds OF millions
Of dollars In duplicate and uncanceled
government bonds had been put In
circulation In the last few years.
These Implications, he estimated later.
reached $4OO,OO0,OOO.
Mr.. Johnson said that these duplica-
tions were first discovered by j. w.
McCarter, assistant register Of the
treasury, in 1910. McCarter, IL was
also declared, was dismissed because
he presented the facts to members OF
Congress.
In the face of recent statements by
treasury officials that no bond duplica-
tions had been discovered, and that
this condition had nothing to do with
the wholesale dsmissals In the Blu
reau of Engraving and Printing, the
belief exists in some quarters here
that Mr.. johnson has furnished some
explanation for the unusual action OF
President Harding in suddenly remoy-
ing twenty-eight heads of divisions In
the bureau. Now that Mr.. Johnson
has told his story, the government Is
expected to move In more positive
way.
Ii was said at the office Of Secretary
Mellon, following the speech OF Mr..
johnson, that there was nothing new
to report on the statements that bonds
had been duplicated. The secretary's
statement Of April 8 that the reports
OF Implications and wholesale manipu-
lation Of bonds and securities were
false would still stand, 1t was said.
Representative Wingo, Democrat. OF
Arkansas, challenged Mr.. Johnson's
charges In the house. He said that
they might cause uneasiness on the
part of holders of government securi-
ties, and he believed that Secretary
Mellon, In making the denial. did not
lie to the people of the country"
II know definitely that the dupllca-
tons of bonds and uncanceled bonds
placed in circulation reached S4OU.OUO,-
OO0," said Mr.. Johnson. following his
speech. The government will have to
pay for these Implications and uncan-
celed bonds, as il has no way of say
ing that the holders received them
fraudulently.
in some instances, especially in the
case of Implications, there Is no way
of establishing that an individual OBJ
iained ms bond through a fraudulent
transaction. | know that interest on
these duplicated bonds has been paid
and will continue - be paid.
The GOV 'rnnenl has been !nvestl-
eating these Implications for several
years, Ii is said, but us far us | know
has not as yet determined where the
responsibility lies. IL was iirSt thought
that the duplicate bonds were being
printed IN Cuba, but | understand that
the cstigatlOn conducted in Cuba
proved that to be false and the fraud
or negligence was traced To Washing
ton"
Some others familiar with the situa.
ton existing IN gaze, nnnenl CIRCLES re-
sponslble for the printing, circulation
and cancellation OF government Uundx,
said, following Mr.. JUhnsOn's state
ment. that Implications In bonds exist
ed Il became known that secret
service men la. been investigating re-
ports of such Implications, both here
and in other parts uf the country, for
II number Ui years.
Mr.. johnson brungh, out his charges
in statement on Tue dismissal By At
torney General Dausherty OF Special
Agent Watts. lie received an allow.
ance ot ten snia",cr ~ eApi" zee the
house his connection with Mr.. Watts
and In that time he laid before that
body his story of how McCarter was
dismissed by the previous administers.
ton, us he said, for presenting EVIL
dence 10 members OF Congress about
the duplication Of bonds.