Evening star., 1938-11-30
Warnings Take
In '35Puta al
$1,335,000
Sudur Testifies He
Saw Outgo Of
$780, 900.

WQTT1Hg VI JOLHcTS utu tfLCT ~.
come tar aduiser, Gordon L. r.
Sadur, are charged Dith detrdud-
ing Government OF about S28, 900
in profit tareS from their num-
berS business. Tar claims are
based on Government estimates
that Warnings and their "1Urit-
erS' did gross business OF dround
$4,000, 1000 a year during 1885 and
1886.
While the numbers game books OF
the three Warning brothers showed
they took in Sl,355 900 in 1885, such
figure is no evidence that they
cleared a large profit. their income
tax adviser Gordon L. R. Sadur,
on trial with them for alleged tax
fraud, testified in District Court to-
day.
I've seen concerns take in $l0,-
600 1000 and show loss at the end OF
the year the tax expert said.
WAS it an illegal business?" de-
manded United States Attorney
David A. Pine. interrupting ques-
tioning of the witness by his attor-
ney. Leo A. Rover.
All the defense counsel jumped to
their feet, objecting to Mr.. Pines
query as highly prejudicial. Justice
Bolitha j. Laws told the attorneys
to proceed with their examination.
Testifies on Intake.
Sadur said that SO far as he was
concerned the intake of the War
rings that year was ST. 1876 900. Mr..
Pine interrupted to suggest that this
was 70 per cent of the total play"
and if all the money the writer's
took away from the public was con-
sidered, the Warnings crossed busl-
ness of S2,000,000 that year.
But the Warnings didn't get that
80 per cent Sadur replied.
He referred to the fact in evil
dence that writers" keep their 30
per cent commission and give the
hacker the difference.
Then it wasn't S2,000000, as the
Government contends" Mr.. Rover
pointed out.
The witness said. No. the War
rings got only the figure he cited
He added:
Il also saw an outgo of 81 200 900
and some odd dollars.
He referred to hits" which lucky
Warning customers had made dur
ing the year.
The Government has set up as
part of an alleged conspiracy to de-
fraud an asserted effort by the War
rings and Sadur to withhold from
taxation SIS, 900 which Emmitt War
ring was reported to have said he
paid for protection in 1885.
Under cross examination earlier
today, Sadur testified he asked En-
mitt Warning for supporting data
of money reputedly paid the police
for protection in 1886, but Emmltt
said he had none and so the item
was not claimed as deduction IN
the returns on the numbers business
that year.
Assistant United States Attorney
John j. Wilson asked: Did you ask
Emmitt Warning if he had any evi-
dence of protection paid in 1882"
yes" the witness said, Il asked
him if he had any evidence or sup
porting data and he said no, he had
not. He said he didn't know how
much he had paid that year. l told
him then I couldn't deduct It.
In reply to further questions, Mr..
Sadur said he didn't recall telling
the grand jury last spring: They
Ithe government couldn't get Mr..
Warning or any of his associates to
come down and they called me-"
He might have said that, the de-
fendent conceded, but what he
meant was not that Emmitt had
failed to cooperate with the income
tax people. but that they S~s have
had trouble getting in touch with
him and he had made the contact.
Mr.. Sadur said Emmitt had never
refused to go to the Internal Reve-
nue. Bureau when requested or to
send his employees in when they
we're wanted.
Names Not Revealed.
The protection angle entered into
the discrimination yesterday aft
ernoon. Mr.. Sadur said he asked
Emmitt about the $3.50 week Fed
eral agents had said he told them
protection cost him in 1885, and
Emmitt said it was truc--he had
paid it.
Did you ask him the names of
the police officers he was paying
OFF," demanded Mr.. Wilson.
IT asked him if he had any rec
ords to support this item the de-
fendant replied. "He said he had
not"
But you didn't ask hi mthe
names of the officers?"
mo, I didn't"
did you ask him how he took
care of the protection on his books?"
mo, 1 did not, but it was not
shown on the books
The prosecutor then asked: do
you remember testifying before the
grand jury that Emmitt did deduct
it from his net income because he
felt it was an allowable business ex-
pense?"
Reads From Transcript.
Mr.. Wilson read statement to
, this effect from a transcript, and
Mr.. Sadur said: II don't remember
saying that, but if the record says
so, suppose did. I couldn't have
meant net income, however. You
cant deduct anything from net in
come. That's what remains when
you make all your deductions
You are still of the opinion that
protection is a proper deduction
from income taX?" Mr.. Wilson asked
"I am"
The Government charges that
$4,000 protection money for 1885
was concealed in the hit" columns
of the numbers business by the
Sadur accounting firm.
Mr.. Sadur, completing his direct
testimony late yesterday, told of two
visits he made to the Department
of Justice after the Internal Reye-