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Q. How often does the Treasurer report to that office ?--A. That I am not so certain about, but I think daily.

By Mr. INGALLS: Q. In order to accomplish the fraudulent issue of a bond of the United States, I understand you it would be necessary to procure the corrupt collusion of four distinct departments of the Treasury I-A. To have everything appear right, yes, sir; and a number or clerks in each office must know something about it. Q. And must all corruptly conspire to the same end !-. Yes, sir.

By Mr. BECK: Q. Does your office keep an account of the expenses of the loans ?A. We have that.

Q. In the division of which you are chief ?-A. Yes, sir.

Q. In what form do you keep those expenses; in regard to each bond that is issued, or how is it kept !-A. It is a general account; ours is really a memorandum account only.

Q. For example, on the 1st of July, 1870, the United States had out. standing the bonds indicated in the monthly statement for the 1st of July, 1870, which I show you. Yow, on the 1st day of January, 1880, it has outstanding the character of bonds indicated on the January statement of this year. Does your office enable you to tell us what it cost the government to make the change from that class of bonds out in 1870 to the class of bonds now outstanding ?-A. You mean the commissions?

Q. I mean everything-commissions, double-interest, &c. ?-A. I can. not tell about double-interest.

Q. Why not?-A. We have not any account of it.
Q. Who has an account of it ?-A. I do not know.

Q. Is it not kept in the department ?--A. I do not know; that I have never had charge of.

Q. Can you not in your division, or some other divivision, tell us what we have had to pay to make the change from the class of bouds existing in 1870 to the class of bonds existing on the 1st of January, 18801A. I cannot now,

Q. Is there information in your office that will enable you to do it ? A. I do not know that there is.

Q. Is there any information in any office of the Treasury Department that will enable you to do it, and, if so, which one!-A. I am not informed.

Q. Why is not double-interest part of the expense of making the transfer, as well as commissions :-A. I am not able to answer. I do not think the account has been kept so as to ascertain that exactly.

Q. Can you give us now the cost of the refunding that has been had from July 14,1870, up to the present time, so as to tell us what it cost us to have the change made that is indicated by the two sets of tables which I have exhibited to you -A. So far as commissions and expenses are concerned, I can. I cannot furnish a statement of what is called the double-interest from any records we have in the division.

Q. You refer to the half per cent. commission that was allowed, I suppose ?-A. Yes, sir.

Q. We made a general appropriation of one-half of one per cent. You know how much of that has been paid out, and that is all you can furnish us ?-A. Yes, sir.

Q. Where would application have to be made to ascertain what it has cost us to change the bonds of 1870 to the present existing bonds ?-A


I do not understand how that can be done without taking up every item and going through it, and I do not know that there has been any account kept of it.

Q. Do you think that the people of the United States, or the Congress of the United States, have no means of knowing what it has cost them to make that change in the bonds ?-A. I think it can be done by taking up every individual transaction, of course.

Q. But there is no account kept of it I-A. I do not know of any. Perhaps I can illustrate the course of business of the office. I have here a certificate of the form issued by the Treasurer. It contains a statement of both principal and interest; we exainine it and we see that it is right before we issue the bonds. Upon this particular certificate bonds were issued, with interest from January 1, 1879, so as to pay back the depositor the amount of interest paid ; the bonds being dated Marel 1. Upon our order the Register issues the bond. We have also a complete detaile«l record of the issue.

By the CHAIRMAN : Q. I understood you to say tht athe Treasurer and you compared accounts, probably once a month ?-A. Yes, sir. We do not go through all our accounts with him.

Q. The bond account I am speaking of ?-A. Yes, sir.

Q. Have you done that with the Treasurer as often as once a month? -A. There is no regular time, but we know he has a sufficient sum deposited for the amount of bonds issued.

Q. How do you know that ?-A. By comparison with his amounts, statements from him that he has a certain amount of money deposited.

Q. From the certiticates he sends you l-A. Yes, sir.

Q. Have you anything but those certificates ?--A. Only memoranda ; nothing further.

Q. Am I to understand that when a bond was issued on the first day of the month, or the last day of the month, you would go down or send down to the Treasurer aud compare the bonds issued during that month with the amount of money in the Treasury on account of bonds !-A. The amount deposited. We find that he has a sufficient amount deposited to cover the amount issued. We do not go down there and examine every individual item of his, but the total amount, because sometimes we do not issue in the month for all the deposits of that month. They sometimes run over several days, perhaps a week; sometimes two weeks. Last spring we were so that we were two or three weeks behind.

Q. Do I understand that you and the Treasurer, every six months, or at any time intervening between six months, compare the amount of bonds that has been issued with the cash in the Treasury on account of bonds!A. His account of it; his reports of it.

Q. Where do you get his reports I–A. His reports come to the Public Moneys Division of the Secretary's office, and from that to our office, and we check them.

Q. You get it there, and not from the Treasurer ?-A. Yes, sir; but we do ascertain from him that he has a sufficient amount in bulk.

Q. How do you ascertain that !--A. By sending down and finding the condition of his accounts; how much has been deposited.

Q. Have you any person that has been down within the last six months and made that examination, or have you done it yourself!-A. I used to do it myself, and I think I can furnish you a man who has been down within the last six months.

Q. Have you a written statement of the comparison at any time?-A. I do not know that we have preserved anything of the kind, but it may have been done..

Q. You spoke of the Public Moneys Division being a cheek. How is the Public Moneys Division a check on the issue of bonds ?-A. That division of the Secretary's office receives a report from the Treasurer of the certificates sent to our office.

Q. Each one!-A. Yes, sir,

Q. How does that office know that it compares with the certificates in your office 1-A. We check them.

Q. Who checks them ?-A. Our office.

Q. Then it comes back to your office after all as being the only office that makes the checks.-A. Yes; but after that has been checked then it is compared with the Treassirer's account by the Secretary's office, though not our division of it.

Q. Whose division is that?-A. That is by the Warrant Division.

Q. I understood you to say that when a certificate came from the Treasurer to your office, you issued an order direct upon the Register and the Register issued a bond for the amount that you ordered him to do, and then it came back to your office for check, and then it was ready for delivery ?-A. Yes, sir.

Q. That being so, where would four persons have to make collusion to get a fraudulent bond out !-A. That was, I said, to have everything appear all right in all the offices.

Q. I am speaking now especially of a bond. Your clerk or yourself issues an order for a $2,000 bond when $1,000 was deposited, or you originate an order; it matters not which. The order goes directly to the Register and the bond comes to your office, and then it is ready for delivery. That is the case, is it not !-A. It goes to the register for delivery.

Q. The order goes to the Register, le registers it, no matter what it is; it comes directly back to your office as a bond, and then it is ready for delivery to the purchaser !-A. It is delivered by the Register to the purchaser.

Q. Do you still say it would take four officers ?--A. I did not state four officers.

Q. Well, four persons !-A. The way the thing goes, to give you a distinct account of it

Q. I would rather have an answer to the question directly. A certificate comes from the Treasurer to you to issue a bond for $1,000; you isstie an order upon the Register to issue a bond for $2,000 if you choose to do so. Of course I do not say you would do so; but I am supposing a case. That order goes to the Register; the $2,000 bond is issued and comes to your office; it there receives the initials or the stamp that you may put on; it goes back to the Register, the office whence it came, ready for delivery. That is the plain statement, is it not?-A. Yes, sir. It would require collusion of a number of clerks in my division to do that. I do not do that. I sign it after it has been compared. The order has been made ont from the certificate of deposit and compared by two others, and then I sign it on their check.

Q. It depends on the integrity of your office whether the bond is given according to the correct amount or otherwise ?-A. I did not suppose there was so much responsibility on us; but perhaps it looks that way.

. Are you familiar with the warrants !-A. No, sir.

By Mr. WHYTE: Q. The name of what officers appears upon the bond ?--A. The name of the Register.

Q. Is there no name of any other officer as a check upon the Register, put upon the bond 1-A. No, sir; there are initials of two clerks who are required to make a critical examination of the order and the bond to see that they correspond.

By Mr. BECK: Q. Do you send the Treasurer's certificate to the Register along with the order for the bond ?-A. No, sir; we retain that as our voucher.

Q. Has the Register any means of ascertaining that he has issued a bond in accordance with the certificate of deposit sent you by the Treasurer?-A. By referring to the Treasurer's accounts.

Q. No other way?-A. Not that I am aware of.
Q. Nothing in his ottice to indicate it!-A. No, sir.

Q. And the bond never goes back to the Treasurer for him to see that it has been issued in accordance with the certificate he sent out !-A. No, sir.

Q. Then, suppose the Treasurer sends you a certificate for a thousand dollars and you issue a bond for two thousand dollars, has the Register any means of knowing that your issue is incorrect, at the time of the issue at least?-A. No means except by examination.

Q. Therefore, until your books are examined there is no officer but yourself, that I observe, who could tell that you had issued a bond for two thousand dollars instead of for one thousand dollars; or if so, who could ?--A. There are clerks in my office.

Q. But you can do all this yourself. I am not saying you would, but whatever is done in your office you have a right to do yourself, have you not ?-A. Yes, sir.

Q. And you need not consult any clerk at all, so that one officer in your bureau could issue a two thousand dollar bond when the certificate only came for one thousand dollars, and until your own books were examined no other officer would necessarily know that you had made an over-issue? If it is otherwise, which officer would know it?-A. I do not know that any one would know it.

Q. So that it may depend on the action of one man in your office until an examination is made of your books 1-A. Yes, sir.

Q. And that examination of your books is made about how often :A. I can hardly tell that. We compare with the Register quite frequently; we compare with the Treasurer, that is, we ascertain before the debt statement is made up every month; but we do not make a critical examination of every item then.

Q. Is there any law requiring any examination of your books at any stated period by any other officer of the government 1-A. No, sir.

Q. Then what would prevent a dishonest man, occupying the position that you now occupy, from issuing a bond for double the amount of the certificate sent him by the Treasurer, and how could he be detected until his books came to be examined !-A. I do not know that there would be any way of detecting it before the examination was made.

Q. And that examination is not made at any fixed time in accordance with any law that you are aware of ?-A. Not that I am aware of.

0. So that a dishonest officer could hold back his books for a very long time, could he not ?-A. We are open to inspection all the time. I do not know that we could hold them back at all.

Q. There is no law requiring that examination to be made as a check over that officer at any given time that you are aware of 1-A. No, sir.

Q. When these examinations are made, are they made carefully to see that each one of the offices compares exactly with the other -A. Yes, sir.

Q. What is the object of making the examination ?-A. To see that there has been no mistake.

By the CHAIRMAN: Q. Is not the examination somewhat in this form that you give the Register, and he gives you the total amounts instead of going over and checking every bond that has passed between you !-A. At the end of the month they examine the amounts issued, and then we compare, and if our totals agree it is supposed to be correct.

Q. It is the total amounts you look to, and not each separate transaction ?-A. Unless there is a variation.

By Mr. WHYTE: Q. You look at the aggregate amount and if the aggregate amount agrees you do not then go back to see whether each one of the items making up the aggregate is correct !--A. No, sir.

By Mr. INGALLS: Q. Take the case of the issue of bonds to Emily Stearns, you have bronght the certificate of for our inspection. It appears that on the 1st of March, 1879, she deposited the sum of $15,083.84 on account of subscriptions to the consols of 1907. Let me ask you if in the office of the Treasurer of the United States there was when that money was deposited a book account opened with Emily Stearns ?-A. That I am not familiar with.

Q. You do not know whether that was made the subject of a book entry in that office or not !-A. No, sir. I of course suppose it was, but I do not know anything about it.

Q. You do know that upon that money being deposited duplicate certificates issue, one of which is sent forward and one of which is retained in the office as a memorandum of the transaction ?-A. I suppose they keep an account of it.

Q. You have brought both here!-A. Yes, sir. One was intended to be given to the depositor and the other to be filed in our office.

Q. As evidence to the depositor that the deposit has been received ?A. Yes, sir.

Q. When this account came to you of Emily Stearns, was there a book entry of the transaction made in your office -A. Yes, sir.

Q. A regular ledger account, debtor and creditor 1-A. A regular account, not a credit account, but it is a regular entry on account of the loan, showing the name of the depositor, the amount of money deposited, the account for which the deposit was made, principal and interest.

Q. And then, as I understand, upon this certificate being received the bond is issued ?-A. I issue an order on the Register for the bond.

Q. Is there a book account in your office of this order?-A. Yes, sir.
Q. That appears as a permanent record in the office?-A. Yes, sir.
Q. That is transmitted to the Register?-A. Yes, sir.
Q. And upon it a bond is issued?--A. Yes, sir.

Q. Is there a book account kept in the Register's office of the bonds issued ?-A. Yes, sir.

Q. Stating the name of the person to whom they are issued, and the amount, and the date!-A. Yes, sir.

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