Evening star., 1935-12-05

pl0yeS and Richard E. C1Idghdn,
McElhiLls partner, whose indtct-
Dlent tUds nolIe pressed, tUere taken
into custody after internal reUenue
investigators listened in on trap
conversation betWeen McCdrter
and McEIhAl.
IT see the boys in Washington,
take them to lunch or night clubs
and discuss the cases then-rather
than on the merits"
Such was the method for settling
income tax cases allegedly cited by
Frank B. McElhill, New York tax
consultant. according to testimony to-
day at the tax conspiracy trial of
McElhill and two former Internal
Revenue employees by John A. Conlin,
star witness for the Government.
Before a crowded court room In
Criminal Court, No. 2, of the Dis
trict Supreme Court, Conlin, a tax
consultant for Thomas N. McCarter,
Newark public utilities magnate,
described to jury highlights of con-
versations he had with McElhill over
the latter's alleged proposal to settle
McCarters 1882 income tax liability
for $4,000.
On trial with McEIhil for conspir-
acy to defraud the Government are
John w. Hardgrove, former chief
conferee of the Internal Revenue Bu-
reau, and Henning R. Nelson, a for
mer auditor of the bureau.
COnlin Tells of Meeting.
Referring frequently to a diary,
Conlin told Of meetings and telephone
conversations he had with McElhill
about the middle of 1894. when Nc
Elhill allegedly was trying to induce
McCarter to employ him in a pending
income tax controversy with the
Treasury. McCarter was resisting,
through Conlin, an additional assess
ment of $4,000 on the utility mans
1882 income.
Conlin said that during his inter-
view with McElhill he told the latter
he was not convinced Of McElhills
ability to be of aid to McCarter in the
tax matter.
Il asked McEhill,' Conlin testified,
of had overlooked any decisions or
rulings in connection with Mr.. Nc
Carter's tax matter"
Explained Information Source.
The witness then quoted McElhill as
saving he would be perfectly frank"
whereupon. Conlin asserted, McElhil
told about seeing "the boys in Wash
ington" and entertaining them while
cases were discussed, rather than con-
sidering the cases on their merits.
VIXEN Conlin expressed curiosity
over McElhill's knowledge regarding
the Sl49,000 assessment against
McCarter, McElhill, according to the
witness, explained he got the nfor-
nation from some head in the bu-
reau from whom the conferee or the
auditor would take orders"
Under croSS-eXamination Conlin
said he was not acquainted with Mel
son, but had known Hardgrove for
several years and had always regarded
him highly.
Was Suspicious" of McEIhiII.
Conlin said he first reported his
suspicious" of McElhill to Revenue
Agent Miles at Newark on June 29,
1884. From that time on, he said, all
his dealings with McElhill were done
under direction of revenue agents.
The first meeting between McCarter
and McElhill, he said, took place at
the formers Office in Newark on July
II Of that year and was reported by
dictaphone.
A week later, Conlin said. he called
| on McElhill, at McCarter's instruc-
tions, Ito see what he had to say"
Two days after this, the witness said,
he talked with McElhill over the tele-
phone and was surprised when McEl-
hill told him that he (Conlin) had
lost a certain case, not the McCsrter
case, at the Internal Revenue Bureau.
Had knowledge in Advance.
The witness said McElhill evidenced
knowledge of details of this other case.
The next day the Internal Revenue
(See TAX TRIAL, Page 80