The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-04-09
GUFFY IS LISTED
IN MAGNETIC
DEALS
Held $4o6, oo1 of U. S. Funds
Senators Are ToId-Palmer
and Others Named.
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IT should think 60"
WAS Guffy indicted on the
charge of embezZlement?"
Yes, in December. 1922"
WAS Guffy arrested?"
Eyes; he was arraigned and re,
leased on bond"
HAS he ever been tried?"
Guffy Never Tried.
mo, sir; nothing has ever been
done with his case"
Storck declared an effort was
made last January to get Attorney
General Daugherty Ito nolle PROSE-
the case"
How do you know"
THE Attorney General sent a
memorandum to a Mr.. Ridgely, an
attorney in the department, asking
him to write an opinion upon an
attached memorandum. The second
memorandum was unsigned, but
urged the Attorney General to nolle
PROSE- the case" said Storck.
"Ridgely prepared the opinion for
Daugherty."
Guffy. Storck added, procured
personal loans from banks with
which he deposited the alien trusts
In his care, He offered stock in
two companies with which he was
associated as collateral, Storck said.
After selling alien property, he
added, Guffy often kept the pro-
ceeds for months.
There Is no question but that
Guffy was amiss in returning funds
to the Treasury and both Palmer
and Francis p. Garvin were aware
of it," the witness added
Fund Juggling Alleged.
Storck charged Guffy had fire.
quently "juggled" the funds en-.
trusted to his care.
"Guffy was paid the proceeds Of
the Bosch Magnetic Company on
January 7, 1919. amounting 20
81, 14O, $685." said Storck. HE de.
posted it in the Chase National
Bank in New York and fifty-two
days later, he paid it into the
treasury by drawing a like sum
out Of the Guarantee Trust Com
pany where he kept other alien
"Guffy had the use of this
$4,14O, 65S for flfty-two days and
he never paid back the money
given him by Martin E. Kern, but
used other Government funds"
How much interest was paid
Guffy?"
"Guffy got between IN and per
cent on his money from the Chase
Bank as well as the Guarantee
Trust"
Bank Made Money.
"The Chase Bank then paid Guffy
from 2 to per cent, but would
lend this money out to business men
at call rates as high as 10 or IL
per cent?"
Eyes and then the bank would
lend Guffy money on his personal
note at a low rate of interest"
"Guffy negotiated personal loans, I"
Storck said, ''in banks where he
deposited government money to the
extent Of $2.147,774.80. Some of 1t
has been paid back"
Storck said he submitted a report
on Guffy's actions to the Depart
ment of Justice on August "a, 1922.
Your report" Wheeler said when
Storck finished reading his memo.
randa to the Attorney General,
clearly showed embezzlement and
the commission Of other crimes?"
Denies Action Was Taken.
"And as far as you know, no &C.
ton was taken by Attorney General
Daugherty except the effort to have
the matter nolle prossed?"
That's right"
Storck was next questioned about
the Bosch Magnetic Company sale,
which he had investigated.
Storck said the company was
sold by A. Mitchell Palmer to Mar
tin e. Kern, "a convicted felon, of
Allentown, Pa. and a German citi-
Zen."
Kern was a felon?"
Eyes he was convicted of several
felonies, and he was born in Frank
burg, Germany"