COLUMBIA LIBRARIES OFFSITE 
 
 AVERY FINE ARTS RESTRICTED 
 
 ■■III 
 
 AR01 392581 
 
 fSE OF REPRESENTATIVES. 
 
 ( Report 
 } No. 30. 
 
 NEW YORK CUSTOM-HOUSE. 
 
 March *2, ISfiT. — Resolved, That two thousand copies of the report and accompanying 
 testimony of Committee on New York custom-house, be printed, and five thousand copies of 
 the report only. 
 
 Mr. Hulburd, from the Committee on Public Expenditures, made the following 
 
 REPORT. 
 
 The Committee on Public Expenditures, in accordance with the resolutions of the 
 House, specially directing an investigation into frauds alleged in connection 
 with the New York custom-house, and in the exercise of the general powers 
 and prerogatives of said committee, herewith submit this report and the 
 accompanying evidence, as follows : 
 
 The committee have taken a large amount of testimony in exposition of the 
 alleged abuses, frauds, and wrongs, which are fast becoming in New York, and 
 doubtless quite too generally elsewhere, the chronic and adhesive incidents of 
 the United Slates revenue service. Some abuses are, no doubt, inseparable 
 from the collection of customs under any system yet devised and however ad- 
 ministered ; Consequently, some, by reason of immemorial usage, seem to have 
 acquired a tolerated recognition ; while others, under the looseness and demorali- 
 zation attendant upon a condition of war, have sprung at once into a lusty 
 maturity. 
 
 The abuses of the revenue seizure system, formidable and manifold in any 
 view, have crystallized into legalized extortion. Recently extensive foreign in- 
 terests have become so enmeshed therewith that it is not improbable our govern- 
 ment, through its diplomatic ear, will be constrained to take some notice of the 
 ways and the wiles of men who, under various guises and pretences, aie en- 
 acting most discreditable parts in the various marts of western Europe. But as 
 this feature of the investigation occupied considerable time, so will the briefest 
 consideration of it demand so much, it may be w r ell to first present, and if pos- 
 sible so expose as to arrest, an abuse which only dates back to the induction of 
 Mr. Henry A. Smythe into the office of collector of the port of New York, early 
 in the summer of 1 S66. 
 
 From March, 1^09, when our revenue system began to have a defi lite form, 
 up to August, 1846, government had but one public store for the sale keeping 
 of "unclaimed goods." Previous to 1846, all duties were required to be paid in 
 cash at the time of importation, and the unclaimed goods could not be taken out 
 of the one public store except on payment of duties in cash. 
 
 The act of August 6, 1S46, inaugurated in this country what is known as the 
 warehousing system. From that period to 18o4, government furnished stores 
 for unclaimed and bonded goods. 
 
 The act of 1S46 authorized the warehousing of merchandise in government 
 stores upon a bond for double the amount of the estimated duties, which duties 
 were not required to be paid uutil the goods were withdrawn for consumption. 
 The supplying of these stores and the expenses incident thereto, together with 
 the rapid enlargement of imports, caused extortionate rents to be demanded, or 
 
2 
 
 NEW FORK CUSTOM-HOUSE. 
 
 assumed by collectors to be demanded; to be rid of all which, government, by 
 the act of March "^s, 1*">4, extended "the warehousing system to private ware- 
 houses." The proprietors of sucli warehouses were required to obtain the ap- 
 proval of the Secretary of the Treasury and to give the government bonds for 
 the safe-keeping of the goods. Thereafter government ceased to b ase or use 
 public stores for warehousing purposes. 
 
 By a regulation, all goods unclaimed by the owner or consignee at the expi- 
 ration of the period allowed by law for the discharge of the vessel in which the 
 same may have been imported, are, in virtue of a general order issued by the 
 collector, sent to a store, approved for that purpose, which store, in consequence, 
 is designated "general order store." No goods can betaken from such store or 
 bonded warehouse until all (barges due the warehouse proprietor have been 
 paid. These charges consist of the cartage of goods from ves.-els to general 
 order store, and storage of and labor upon said goods, and it is specially pre- 
 scribed that these charges "shall not exceed in any case the regular rates for 
 like merchandise at the port of importation." In the port of New Vork the 
 allowable rates of storage and labor are fixed by the Chamber of (' m merce. 
 In case any dispute arises as to the correctness of the charges, the decision of 
 the president of the Chamber of Commerce, or if there be no such officer, the 
 decinon of the collector or chief revenue officer of the port is binding upon all 
 parties" 
 
 All merchandise arriving from foreign ports is in peril of being sent under 
 general order. This arises from a variety of causes : tlx- necessity of despatch 
 in discharging the vessel, not allowing the merchant time to procure his per- 
 mits ; discrepancies between marks' and numbers on the custom-house permits 
 
 and those on the cases or packages containing the goods; sometime the non- 
 arrival of invoices and bills of lading prevent the granting of permits. It is 
 scarce possible to approximate an average proportion of the imports which, in 
 the course of a year, go under general order. Steamers now enjoy the bulk of 
 the valuable carrying trade, and it is estimated thus full a third of their cargoes 
 are subjected to general order. Sailing vessels, which are chiefly employed in 
 the transport of heavy freights, do not send thus so large a proportion. Per- 
 haps a more accurate idea of the probable exent of this business may be ar- 
 rived at by an examination of the following tables prepared for the committee's 
 use by the Bureau of Statistics : 
 
 Tabic exhibiting the value of merchandise imparted into the district of Netc York during the 
 Jiscal ijtars Im>2, l?r03, 1>04. 1.-05, and J^OO, and the duty un merchandise collected during 
 the sami periods. 
 
 Years. 
 
 Value of merchandise. 
 
 Duty on merchandise 
 collected. 
 
 1862 
 
 $142,215, 636 
 177,234,415 
 229, 506, 499 
 154, 139,409 
 302,505, 819 
 
 $34,529, 146 42 
 48, 630, 64- 68 
 72, 406, 625 75 
 55,292,513 76 
 
 131,833, 141 36 
 
 1863 
 
 1864 
 
 1865 
 
 1866 
 
 Total 
 
 1,005, 621,778 
 
 342,688,075 97 
 
 
 It is thus seen that the business of general order, storage, and cartage inci- 
 dent thereto, must necessarily be large, and conducted at the proper and legiti- 
 mate rates fixed after years of experience, should be proportionately remunera- 
 tive. The very nature of the business and the requirement that " all charges" 
 must be paid before delivery, prevents a close scrutiny into the correctness of 
 these manifold charges. No notice would be taken of a small excess; even a 
 considerable excess might be passed by the politic merchant, who, for various 
 
NEW YORK CCSTOM-HOUSE. 
 
 3 
 
 reasons of convenience, despatch, &c, desires the good will of the warehouse- 
 man. Thus, little by little, these charges, by constant unlawful accretions in 
 the period of a year, might aggregate a very considerable amount from each 
 importer. It will be seen this is by no means a contingent supposition. 
 
 The magnitude of the general order business and of its legitimate returns, 
 the facile opportunity its itemized nature admiting the constant absorption of 
 small unlawful additions thereto, conspire to render its concession or lease eagerly 
 sought after, as, in broker's phrase, capable of being made a good thing. 
 
 It is evident from the testimony that Mr. Smythe early gauged the appreci- 
 able value and commercial use he could make by the disposal of the general 
 order business, declaring as he did, the very first day of his official life, to Mr. 
 Barr, a witness, and others, " The North river general order business is the big 
 plum for the collector." It is also rendered quite probable that before his con- 
 firmation by the Senate, possibly before his nomination even, he had " agreed" 
 with and in behalf of certain persons, that they should be pecuniarily benefited 
 by the allotment or concession of the "plum" business. While Mr. Smythe de- 
 clined informing the committee who these persons were, he was less reticent as 
 to the division of the valuation or price lie had fixed upon the general order 
 business. Other witnesses were more communicative, and by the aid of their 
 testimony and of a proven memorandum, the committee were enabled to learn, 
 with tolerable precision, the names of these intended beneficiaries and the sums 
 they were respectively to receive. 
 
 From Mr. Smythe's contemporaneous declarations, his own sworn admissions 
 before the committee, and the testimony of Peter A. Van Beigen, it seems the 
 collector's first known attempt to " place" the general order was by negotiating 
 with Van Bergen & Co., immediately on taking the office. The unique part- 
 nership oi this firm may have originated in Washington before Mr. Smythe's 
 nomination ; possibly it was enlarged before that nomination was acted upon in 
 the Senate. Whatever the place or time of its origin may have been, there is 
 a tolerable certainty that Van Bergen, George F. Thomson, Senators Doolittle 
 and Patterson, and a " Mrs. Perry," had unequal interests in its effective opera- 
 tion. It is quite likely this arrangement was expected to be the fulfilment of 
 Mr. Smythe's oracular saying, that " Parties in Washington of large influence 
 and great expectations" must be taken care of. 
 
 When Mr. Smythe came into office Messrs. Humphrey & Co. were in the 
 unpurchased enjoyment of the general order business ; its management by that 
 firm caused no friction or antagonism between them and merchants, or with the 
 collector. 
 
 Possessing unexpired leases of warehouses rented expressly for that purpose, 
 they naturally desired to retain a fair share, if not all, of the business. In 
 furtherance of this desire, Mr. James Humphrey, partner of the firm of Humphrey 
 & Co., and at that time member of Congress from the Brooklyn district, early 
 called upon Collector Smythe to solicit a continuance with his house of the gen- 
 eral order business. 
 
 He was informed by Mr. Smythe that Mr. George H. Thomson, who in 
 negotiations represented Van Bergen & Co., must have the lion's part, or three 
 of the four shares; that Humphrey & Co. could, with Van Bergen & Co., have 
 one share of North river and all of East river. But that, in such an event, 
 Humphrey & Co. must "take care of two friends of the President ;" that the 
 collector must have 83,000 from the cartage business for a political fund. Mr. 
 Humphrey at once communicated with his partners. One of them wrote out on. 
 a slip of paper the form as follows : 
 
 " North river — Thomson three shares, H. & Co. one share ; East river — H. 
 & Co., who are to take care of the two friends of the President ; cartage, S3, 000 
 for political fund." 
 
 Mr. Humphrey, after consultation with his partners, returned to Mr. Smythe, 
 
4 
 
 NKW YORK CrSTOM-llOr'SE. 
 
 And , banding him the memorandum slip, asked iftli.it was tie proposition. 
 
 Mr. Sinythe, after pencilling opposite the words and figures, "Thomson three 
 
 Hh;ircs," the letters "V. W. Co," assented. On b< in_ir asked by Mr. Hum- 
 phrey if, under (he circumstances and requirements, Humphrey & Co could not 
 be allowed a larger proportion of the general order, .Mr. Sinythe replied, " No," 
 for he bad got to pay out of it 820,000. He then proceeded to pencil on the 
 
 back of tin; memorandum slip the distribution of it, in words and figures as 
 follows : 
 
 "Mrs. Perry $3,000, Brown 82,000, political $5,000 810,000 
 
 "85,000,8.0,000 10,000 
 
 20, 000 
 
 This original slip was exhibited and identified and explained to the committee 
 by one of the surviving partners of the linn of Humphrey & ( '«». The pen- 
 cilled letters, names, and figures on the lace and hack of the Blip were proven 
 
 to be the undoubted autographic characteristics of Mr. Smythe by 8. Gk Ogden, 
 auditor of the New York custom-house. The duplicate "85,000" represented the 
 respective amounts destined for the "two friends of the President. Abundant 
 testimony, other than the declarations of the now deceased Mr Humphrey, to 
 that effect, conclusively show Messrs. Doolittle and Patterson to have been the 
 "friends," 
 
 At a later and last interview of Mr. Humphrey with the collector, on the 
 same or following day with the foregoing, he informed Mr. Humphrey that he 
 had sold the whole general order business to Messrs. Miller & Conger "for the 
 round sum of 840,000 per annum." On Mr. Humphrey's remonstrance against 
 being treated and tiifled with in that manner, Mr. Smythe coolly offered him a 
 gratuity of $3,000 out of the "round $40,000." 
 
 Those who knew Mr. Humphrey when living can well believe his represent- 
 ations of these interviews and his indignant rejection of the last proffer. Had 
 all this been known at the time of his death, the announcement of it in the col- 
 lector's ante- room, in the presence of Messrs. Thomson, Embree, and others, 
 surely would not have, unrebuked, called out the unfailing remark that " there 
 was one less to divide with." 
 
 The contemplated distribution, under this 840,000 arrangement, appears from 
 Mr. Smytbe's and others' testimony to have been a little more explicit and ex- 
 
 haustive. It was as follows : 
 
 George F. Thomson, late of the Daily News 85, 000 
 
 Senators Doolittle and Patterson, 85,000 each 10, 000 
 
 Embree, deputy collector 2, 000 
 
 Humphrey, and by him at once rejected 3, 000 
 
 Brown, private secretary of collector, rejected by him 2, 000 
 
 Political fund 10, 000 
 
 "Mrs. Perry," known as "A Washington woman" 3, 000 
 
 Yan Bergen to have some unknown share, say. 5, 000 
 
 This makes up the 840,000, so as to correspond technically with Mr. Smythe's 
 oft-reiterated asseverations that " he was not to have a dollar of it." This show- 
 ing, however, left him sole almoner of the 810,000 political fund. 
 
 The Miller & Conger arrangement fell through, as was commonly supposed, 
 in consequence of their inability to bond suitable warehouses for doing general 
 order business. 
 
 Just here a new negotiator and operator intervenes. E. C. Johnson, a ware- 
 house and general order man of some experience, if to be believed, on hearing 
 of the $40,000 arrangement, went to Mr. Smythe and offered him 8o0,000 per 
 annum for the whole general order business, knowing, to use his own expressive 
 
NEW YORK CUSTOM-HOUSE. 
 
 5 
 
 phrase, "It would knock that arrangement into a cocked hat." And his ex- 
 pectation was not disappointed. 
 
 It is true, when before the committee, Mr. Johnson did not recall to mind this 
 additional decimal thousand inducement of his to break up the Miller & Conger 
 arrangement. In fact, he could not recall even "the cocked hat" illustration, 
 though it was abundantly proved to have been his favorite and frequent phrase 
 when speaking of his agency in the transaction. It was, however, made quite 
 manifest to the committee that this was not the only instance where, when before 
 them, Mr. Johnson exhibited a very irregular and defective or a very treacher- 
 ous memory. The perusal of his testimony will not only repay the time ex- g 
 pended, bur satisfy the most superficial humanitarian that, under certain surround- 
 ings, man, in the abstract of the individual and in the concrete of society, is a 
 strange, complex being. 
 
 Mr. Johnson's offer was accepted ; and assuring the collector that Thomson 
 managed the Miller & Conger affair badly, he would conduct it " with a view 
 of avoiding any unpleasant consequences from an investigating committee." 
 When reminded that such sale and purchase might be deemed a misdemeanor 
 under the act of March 3, 1S63, he replied, "Nobody would know anything 
 about it." When assured by persons of larger and later experience that the 
 general order business of the whole city of New York, fairly and decently con- 
 ducted, would not pay a profit of $50,000 a year, he developed his plan. That 
 was no less than systematized and protected extortion, to be effected in this 
 wise : raise much higher than ever before paid the rates and charges for storage, 
 labor, cartage, &c, expressing his belief that thus the business might be made 
 to yield an annual profit of $100,000. He further declared, if the importers 
 complained and appealed to the collector, he would not reduce the rates, but 
 would protect and sustain the lessees who had the general order business On 
 such a basis, and with such inducements, Johnson attempted to sell Messrs. 
 Bixbv & Co. a part of the business. They declined all negotiations on such 
 expectations, declaring they did not believe the collector, directly or indirectly, 
 could be privy to and uphold such contemplated and conditioned sale of govern- 
 ment patronage, and such an organized plan for deliberate outrageous exactions. 
 However, under all the preceding and attending and subsequent circumstances, 
 it is impossible to resist the belief that Mr. Smythe could not certainly long have 
 continued in ignorance of the use this intermediary and ambassador of extortion 
 was making of his official name and position. 
 
 In saying this the committee are well aware of the consequence that ought 
 instantly to follow. Certainly justice, outraged right, the protection of trade, 
 a decen., respect even for official propriety, ought to insure a prompt dissev- 
 erance of government connection and official complicity with such concerted 
 robberies. "Good antecedents" shrivel and wither in the pres nee of such bold 
 developments. "G-ood standing on 'change." or in "bank parlors," is of small 
 account to gloss over the wickedness of such proposed enormities. And the 
 committee feel constrained to say, in justice to themselves, to the pillaged mer- 
 chants, to honest, high-minded officials throughout our land, to allow the inau- 
 gurator of such picaroon proposals and proceedings to continue sitting at the 
 receipt of custom must inevitably degrade manhood generally, and essentially, 
 if not entirely, demoralize all the subordinate bureaus and branches of public 
 service connected therewith. 
 
 It would seem, for some reason, that the $50,000 arrangement was modified as 
 follows: Thirty-five per cent, of the gross proceeds of the storage feature of 
 general order business was to be accounted for aud paid thus: thirty per cent, 
 of it to the collector, and five per cent, to Johnson, for his manipulation of the 
 business and his assumed influence with Mr. Smythe in sustaining t ie lessees of 
 the general order against appeals from the importers. Thereupon Johnson pro- 
 ceeded to farm out the business; Edwards, Atkins & Co. receiving a part of 
 
G NEW YORK CUSTOM-HOUSE. 
 
 North river, E. C. Johnson & C<>. retaining the remainder of North river and a 
 pari of' East river. Messrs. Miller & Conner had another part of EaM river, 
 It is in proof that all the lessees paid on the thirty-five per cent, h.tsis to .John- 
 son, "the bag- bearer" of this fund, from about Aujrust 1, I — ' i * J , to l)(ceinl)er I, 
 1866, when a new and last, thus far, deal took place. 
 
 On the 4th of August, isiio. Messrs. Bizbj tV- Co., and Messrs. Squires & Co., 
 
 whose warehouses had previously stored general order go <ls, proposed, iii writ- 
 ing, if the business was continued with them, to pay into the United States 
 treasury $15,000 a year. If moral or legal objections existed te contracting the 
 
 . disposal of BUCh official patronage, they would allow an annual rebate of that 
 amount in favor of the merchants from the usual and legal charges, Upon which 
 basis only they proposed to receive and do the bttStneSS. 
 
 To this Mr. Smythe on the same day replied : "Had it reached me before 
 
 the matter was disposed of, it would have been considered. The same result, 
 
 however, so far as the merchants are interested, will, I trust, be reached under 
 the new arrangement." 
 
 Was the collector sincere in this reply? If so, why was the $15,000 propo- 
 sition lost sight of in the last fixing up of this business? If on his liles it could 
 not have well been overlooked or forgotten. 
 
 Hut the collector said the same results, *15. 000 into the treasury, or off' from 
 the merchants, "ami legal rates and charges," would be reached by the Johnson 
 arrangement. How he kept that promise will be peen by the following bills: 
 
 Landman & Kemp had twenty cases of quinine in Johnson's warehouse, the 
 legal rates and figures on which would be as follows: 
 
 20 cases, storage, 10 cents each $2 00 
 
 Do. labor, ]0 cents each 2 00 
 
 Do. cartage 1 32 
 
 5 32 
 
 The bill rendered was as follows: 
 
 20 cases, storage, 50 cents each $10 00 
 
 Do. labor, 50 cents each 10 00 
 
 Do. cartage 10 00 
 
 30 00 
 
 These cases weighed eighty pounds each — total 1.600 pounds. A legal cart- 
 load is 1,200 pounds. The legal price per distance, in this particular instance 
 was sixty-six cents per load. It was testified before the committee that bills of 
 such "make up " could be multiplied almost a<l infinitum. 
 
 Notwithstanding the rendition and paymer.t of such bills, Mr. Smythe soon 
 became dissatisfied with the small returns of the thirty-five per cent, arrange- 
 ment, and sought again to avail himself of George F. Thomson's assistance. In 
 November an offer of $20,000 per annum was suggested through him for the 
 business. He thought so small a sum was too much of a come-down from S-10,000, 
 and would not be accepted. Twenty -five thousand dollars were offered. Thom- 
 son said it would not do ; the collector must have S2.000 per month in advance, 
 and he (Thomson) must have $5,000 a year himself. This was the condition 
 of things when the congressional committee on retrenchment and reform was 
 in session in New York. On the first of December, 1866, the general order 
 business of the whole city was turned over to Myers & Smith. The conditions 
 of this transfer were not made apparent in the committee-room, except that 
 Thomson was to have $5,000 or more out of the business for some undefined 
 
NEW YORK CUSTOM-HOUSE. 
 
 7 
 
 outside services he had rendered, or was expected to render. It is to be noticed 
 that the several parties in interest swear no valuable consideration or pecuniary 
 inducement, past, present, in expectancy, or in promise, entered into the Myers 
 & Smith arrangement to beuefit the collector, or anybody in his behalf, or other 
 person whatever. But Messrs. Miller & Conger, who still retained for some 
 weeks after part of the general order, were required and did pay to Myers & 
 Smith on the thirty-five per cent, basis, as afrretime. It would also seem 
 that E. 0. Johnson & Co. did likewise. Who had that thirty-five per cent, 
 money ? Did Mr. Smythe give that levy to Myers & Smith ? Mr. Smythe 
 swears he has never, directly or indirectly, received anything from them, 
 and never expects to. Nay, under the solemnity of an oath he declares he gave 
 to them all that business for nothing — for nothing, that he might escape personal 
 annoyance, and that the merchants might have justice in the premises ; for no- 
 thing, when he had been told that it was worth 8-50,000 ; when, based upon it, he 
 had parcelled out shares or suras amounting to -840,000 per annum ; had received 
 through his accredited agent-broker more or less of the thirty per cent, drippings ; 
 had refused $25,000 as too small a sum. Notwithstanding all which, he had 
 magnanimously bestowed the working of this placer upon Myers & Smith with- 
 out fee or reward, or stipulate ra or solicitation or motive, other than personal con- 
 venience, and desire that justice should be done to the merchants of Xew York. 
 
 It is more in accordance with previous declarations and arrangements to be- 
 lieve things and oaths had been so prearranged that it was hoped, and expected, 
 as was half proved to have been boasted, " that this time no d — d congressional 
 investigating committee could get hold of the arrangement." 
 
 Certain it is, however, there were some misgivings as to whether all was 
 working satisfactorily and would " hold tight," judging from a little out-cropping. 
 On a Friday the House authorized the Committee on Public Expenditures to in- 
 vestigate custom-house matters, &c. Saturday's papers announced the com- 
 mittee would be .in New York for that purpose on the following Monday. In 
 one or two of the intervening Sunday papers appeared the following advertise- 
 ment : 
 
 General Order Goods. — The undersigned having, from the first of December, charge 
 of merchandise delivered under general order, and knowing that serious complaints have 
 heretofore been made in reference to overcharges for storage, &c, we desire to inform tbe 
 merchants of this city that, in order to meet their views and to prevent the renewal of com- 
 plaints, we shall, by the direction of the collector of the port, reduce the charges on such 
 goods to a satisfactory basis, and in case of any complaint we invite the immediate presental 
 of the same to us. 
 
 MYERS & SMITH, 
 
 Office 397 Greenwich street. 
 
 During the early sessions of the committee, there, no complaints were made of 
 over-charges. So ra after the committee returned finally to Washington, as was 
 supposed, such bills as the following began to be made up : 
 
 C. Gautier had 150 cases of wine under general order with Myers & Smith, 
 for which they rendered an account of $62 ; the legal rates and charges could 
 have been but 621 64. In another instance, storage, &c, on forty bales of 
 flocks or waste was charged by Myers & Smith at SS0 while the legal charges 
 could only be $49 60. 
 
 By recurring to a tabular statement in F. M. Bixby's testimony it will be seen 
 how such charges are made to swell sometimes to a thousand per cent, over legi- 
 timate rates. As a consequence of high rates, had safe and convenient ware- 
 houses for doing general order business been assured to shippers and merchants, 
 though affording no justification, there might have been a show of palliation; 
 but no such advantage followed. The principal warehouse employed by -Myers & 
 Smith for doing general order business is situated at the foot of Bank street, on 
 the extreme west side of the city, and is full two miles up town, and away from 
 
8 
 
 NEW YORK CUSTOM-HOUSE. 
 
 where shippers and importers "do mostly congregate.' 1 Superadded to all the 
 
 additional expense caused thereby, loss of time in carting goods to and from, 
 exposure more or less to the weather of valuable cases of merchandise, is the 
 absolute insecurity of the goods while in tin- vicinity of ihe warehouse; eafteri 
 
 testifying: that they dared not dray goods there late in tlx- day from apprehen- 
 sions of individual and concerted pillage. The numerous piles of combustible 
 Inmber that constitute lumber-yards add yet another peril and objection to this 
 out-of-the-way warehouse. 
 
 It may be asked, at whose behoof and for whose benefit, now, are all these 
 exactions and jeopardies . ; 
 
 The collector, through his subordinates, has tin- sole right of directing to 
 whose and what warehouse general order merchandise shall go. Mr. Smythe 
 early announced that he regarded the selling of that direction, a persona] per- 
 quisite of the collector. To ascertain whether Buch was usage a4 tin- port of 
 New York, the committee called before them or directly communicated with all 
 the living ex-collectors, and each declared he had no knowledge or belief that that 
 
 or any other government patronage, dependent upon tin- collectorship, had been 
 sold or offered for sale during their respeetire administrations of thatofh'ce. To 
 this effect the testimony of Messrs. Sehell and Barney, and the subjoined note 
 of Mr. liedtield, are most explicit and emphatic* 
 
 Mr. Smythe, as appears, took a different view and course. He had "agreed,'' 
 he had placed himself " under obligations," tV'C. To whom '.' If he js to be 
 held credible and responsible, judging from his own statements, "he agreed to 
 give, or was going to give, out of the general order business, to persons in Wash- 
 ington, some $5,0 10 to Robert Johnson, the President's son; $5,000 to Mr. or 
 Mrs. Patterson; .^o.OOO to a son of Senator Doolittle, &c. 
 
 It is true that Mr. Smythe does not remember that he ever mentioned to the 
 President or other parties in Washington his kind intentions. It was, however, 
 evident that his memorizing faculty was either bad, or his recollection quite 
 defective, or his agent Thomson and several other witnesses had very inventive 
 memories. Whichever that may be, Mr. Spalding, of the legal profession in 
 New York, did remember in committee-room that Senator Doolittle had in 
 Washington told him that Mr. Smythe had conversed with him about general 
 order business ; had promised his son, then in Racine, Wisconsin, a place under 
 him and an interest in the profits of the general order business, &c. The 
 senator's son did come to New York, and now holds a very good place in the 
 New York custom-house. 
 
 With these data before us we can now form a pretty conclusive opinion as 
 to several who were interested in the collector's big plum. How much the 
 divisible interest of each participant amounted to, or how much was actually 
 paid and received, of course, is not so easy of ascertainment. Mr. Smythe is 
 quite positive as to Mrs. Perry, that she never received over S500, and with 
 great naivete declares he paid that out of his own funds. 
 
 How she, a Washington woman, became interested, and to be benefited in 
 the general order business of the port of New York, is explained by the testimony 
 of Messrs. Phelps &: Barr. 
 
 Mr. Smythe has no distinct recollection of having paid anybody anything, 
 or of having himself ever received anything out of or from the general order 
 business. Perhaps the obliviousness with which he every month took and sub- 
 scribed an oath that he had not "received directly or indirectly, nor directly or 
 indirectly agreed to receive, or be paid for his own use or another's benefit, for or 
 on account of storage, labor, or cartage, &c., any money, art cle, or considera- 
 tion," may, from sheer force of habit, have continued to influence him when 
 testifying before the committee. It is very certain the recollection of Mr. 
 Thomson, and of Messrs. Thomas, Brown, Pierce, and several other unim- 
 peachable gentlemen, not practiced in custom-house oaths, differs very widely 
 
NEW YORK CUSTOM-HOUSE. 
 
 9 
 
 from Collector Smythe's, as will be seen by recurrence to their testimony. It 
 is unpleasant thus to invite attention to the statements of these witnesses, the 
 evidence of Mr. Smythe, and the form of the oaths to which he subscribed every 
 month since he became collector. Copies or forms of these oaths are given in 
 full in the testimony of the auditor of the custom-house, S. E. Ogden. 
 
 This comparison of testimony and of the forms of the monthly oaths taken 
 by the collector will be interesting while very briefly reviewing his connection 
 with the cartage business. 
 
 This business, though commonly regarded as a constituent part of general 
 order business, Mr. Smythe has, for his purposes, somewhat segregated there- 
 from, so as to invite proposals for its monopoly. A Mr. Mclntire's offer of 
 81A000 per annum was not thought large enough by Deputy Collector Embree, 
 Mr. Smythe's representative in this matter, and was consequently rejected. So 
 much of the cartage as pertained to the appraisers' stores was finally farmed 
 out to Messrs. Lindsay, Keyes & Meagher. Two monthly instalments of $250 
 each, as appears by Mr. Brown's testimony, while he was the collector's private 
 secretary, did come into his hands, and, on the request of the collector, was 
 kept by him for the collector. Why Mr. Brown was made the temporary keeper 
 of this fund until wanted, perhaps the monthly oaths explain; when it was 
 called for, and for what purpose, appears in Mr. Brown's testimony. This cart- 
 age business is yet in the same hands ; how many instalments have been paid, 
 or the disposition of the same, the committee have not at present the means of 
 knowing. 
 
 Although the importers' private cartmen give bonds and take licenses to 
 enable them to " ride" bonded goods, they are not allowed to handle them until 
 the custom- house cartmen have drayed such goods as are sent under general 
 order to general-order warehouses, and from thence, such as are required, to 
 private bonded warehouses. 
 
 This unnecessary and arbitrary requirement, solely for the benefit of the con- 
 tracting custom-house cartmen, is fixed formally and enforced by such a rescript 
 as the following : 
 
 Collector's Office, Custom-holse, 
 
 Neio York, October 17, 1866. 
 
 Sir : In conformity with your suggestion, you are hereby directed to see that all goods 
 taken from one bonded warehouse to another are transferred by the regularly appointed cus- 
 tom-house cartmen. 
 
 H. A. SMYTHE, Collector. 
 
 F. B. AsilTOX, Warehouse Superintendent. 
 
 Mr. Bugbee's testimony fully explains the operation of this order: that while 
 government gets no additional advantage or security, the importer is subjected 
 thereby to great inconvenience, sometimes delay, in hunting up his goods, and 
 made to pay from fifty to sixty per cent, more fbr'cartage than if he was allowed 
 to employ his own truckman. 
 
 Simply characterizing this wanton interference with the rights of merchants 
 as outrage No. 2 of Mr. Smythe's administration of the New York custom-house, 
 the committee pass over with but a word his numerous changes, removals, 
 appointments and reappointments, &c, whereby he has greatly disorgan- 
 ized, demoralized, and impaired the capacity and working force of the revenue 
 service of the port. Faithful, experienced, capable men have, for no known 
 cause but the collector's capriciousness, been made to give place, not infre- 
 quently, to incapacity, ignorance, vice, and, in one instance, to a convicted thief. 
 To this disreputable catalogue, but for the firmness of Deputy Collector Sted- 
 well in rejecting Mr. Smythe's nomination, might have been added, an indicted 
 murderer. 
 
 By his uncalled-for additions to the pay-roll of the custom-house, raising sala- 
 
10 
 
 NEW YORK CUSTOM-HOUSE. 
 
 ries, multiplying appointees, &C, while business decreased, he ha- increased 
 expenses at the rate, it is said, of from $250,000 to 8350,000 per year 
 
 Here the committee pause in the enumeration of Mr. Smythe'fl profligate 
 practices in connection with the New York custom-house, from no lack of mate- 
 rial, but believing the finding abundantly tnfficient to warrant and require and 
 insure his immediate removal from the ollice of collector of the port of New 
 York. 
 
 Public propriety and decency demand this rebuke and reparation. To with- 
 stand or delay, will inevitably tc"d to focalize and fix suspicion hit > allegation, 
 surmise into certainty. It is also the initial and necessary step towards reform, 
 and towards the prevention, hy example, of the recurrence of such abuse>, corrup- 
 tions, and wrongs. The committee believe there may be an essentia] modifica- 
 tion, if not comparative prevention, of these abuef upon some such ba-is as the 
 following recommendations : 
 
 First. An honest and capable collector should be appointed, who should be 
 prohibited from selling or fanning out, for a consideration, general order busi- 
 ness. lie should not in anywise allow warehousemen to be taxed or hardened 
 because they are warehousemen. He should compel the observance of such 
 regulations in regard to storage and cartage charges as are the current rates of 
 the port. 
 
 Second. Whenever an importer presents an invoice or hill of lading to the 
 collector, he should, on application, he entitled to receive a special general 
 order for the goods therein mentioned for any regularly bonded warehouse. To 
 prevent the too great multiplication of these specials, a tixed small fee might be 
 req uired. 
 
 The effect of this, it is believed, would he that the storage for general order 
 goods would he "the current rates," &c. Should it be otherwise, the merchant 
 would have in his special order permit an adequate remedy at all times in his 
 own hands. 
 
 Perhaps, as the law now is, an inflexible treasury regulation would effect most 
 of these requirements. 
 
 As for changes and removals, so damaging and so demoralizing to the service, 
 the committee believe no removals should be made except for good cause, whicb 
 should be specifically reported to the Secretary of the Treasury for his approval. 
 
 With these brief suggestions as to remedies, the committee dismiss from fur- 
 ther consideration this branch of their investigation and turn to a hasty exami- 
 nation in connection witb the New York custom-house of 
 
 THE SEIZURE BUSINESS. 
 
 The seizure bureau, as an adjunct of the collection of customs revenue in the 
 United States, in modified form and operation, is not of recent origin. The act 
 entitled " An act to prevent aird punish frauds upon the revenue, to provide for 
 the more certain collection of claims in favor of the United States, and for other 
 purposes," approved March 3, 1863, greatly enlarged tbe powers, and wonder- 
 fully stimulated the activities of this bureau. 
 
 Intended, no doubt, as its title purports, " to prevent and punisb frauds," it 
 has been, not unfrequently, perverted into a medium and instrument of oppres- 
 sion and flagrant injustice. 
 
 A section of an act of Congress, passed March 2, 1799, provided that every 
 collector, naval officer, or surveyor, who had cause to suspect a concealment, in 
 any place, of goods on which duties have not been paid, shall, upon proper ap- 
 plication on oath to any justice of the peace, be entitled to a warrant to enter 
 such place, in the daytime, and " seize and secure the goods for trial." It was 
 never contended that this law authorized a search and seizure of private books 
 and papers to obtain and use them as evidence to condemn property. It only 
 
NEW YOEK CUSTOM-HOUSE. 
 
 11 
 
 authorized the seizure of suspected property. A section of the act ot 1863 
 has been held in practice, if not on the bench — it is to be hoped without much 
 examination — to authorize the exercise of the very power and practices which 
 the act of 1799 did not bestow and has not been construed to do. That section, 
 the 7th, is as follows : 
 
 " Sec. 7. And be it further enacted, That whenever it shall be made to appear, by affidavit, 
 to the satisfaction of the district judge of any district within the United States, that any 
 fraud ou the revenue has been at any time actually committed, or attempted, by any person 
 or persons interested or in any way engaged in the importation or entry of merchandise at 
 any port within the United States, said judge shall forthwith issue his warrant, directed to 
 the collector of the port at which the merchandise in respect to which said alleged frauds 
 have been committed or attempted has been imported or entered, directing said officer, or 
 his duly authorized agents or assistants, to enter any place or premises where any invoice, 
 books, or papers relating to such merchandise or fraud are deposited, and to take and cany 
 the same away to be inspected ; and any invoices, books, or papers so received or taken shall 
 be retained by the officer receiving the same, for the use of the United States, so long as the 
 retention thereof may be necessary, subject to the control and direction of the Solicitor of 
 the Treasury." 
 
 The 39th section of the act of July, 1S66, declares " any district judge " is 
 authorized to issue a warrant directed to any collector of the customs, &c. In 
 virtue of that provision a judge in Maine or Maryland, for example, is em- 
 powered to issue a warrant valid in Boston or New York, &c. As no incon- 
 venience under this last amendment of 1S66 has been brought to the knowl- 
 edge of the committee, it is dismissed with the single suggestion that it admits 
 of very great abuse and should assuredly be somewhat restricted. The 10th 
 section of the act of 1863 reserves and makes dependent "upon the recommenda- 
 tion of the Solicitor of the Treasury any claim in favor of the United States," 
 before "the same be compromised." The effect of that section has been, and 
 practically now is, mandatory upon the Secretary of the Treasury in his revisory 
 and administrative decisions, where claims are sought to be compromised. The 
 exercise of any discretion by him is to be controlled by the recommendation of 
 one of his subordinates. Already, and probably more than once, the Secretary 
 has been made to feel this subordination. A recent letter showing the practical 
 working of this section was brought to the attention of the committee. 
 
 The Solicitor of the Treasury, Mr. Jordan, when before the committee stated 
 that he drew or prepared the several revenue sections of the March act of 1863. 
 His motives and purpose may have been of the purest and most patriotic kind, 
 but had he desired to frame an act to enable the Solicitor to make every owner 
 or agent having charge of any claim in favor of the United States, or defending 
 any such claims, or proposing to compromise any such claim, tributary and 
 contributory to that officer, human ingenuity could scarcely have devised one 
 better adapted to that purpose than the 7th and 10th sections of the act of 
 March, 1863. It may not be thought amiss to spend a moment in surveying 
 the origin, duties, powers, &c, of the Solicitor of the Treasury, who, 
 perhaps all unconsciously, by his own instrumentality has become the controlling 
 arbiter of the fortuues, and the privacies, and the rights of the commercial citi- 
 zens of the importing cities of this country. 
 
 The office of Solicitor of the Treasury was created by act of Congress, May 
 29, 1S30, (4 Statutes, page 414.) By this act the Solicitor has charge of all 
 suits or actions for the recovery of any fine, penalty or forfeiture. He also has 
 power to instruct district attorneys, marshals, and clerks of the federal courts 
 in all matters appertaining to suits, in which the United States is a party or 
 interested. He has authority to establish rules and regulations for the observ- 
 ance of collectors, district attorneys and marshals. Under the second section 
 of the act of Congress of March 3, 1863, (12 vol. Statutes, 739,) he has cogni- 
 zance of frauds, or attempted frauds, upon the revenue, and is bound to exercise 
 a general supervision of measures for their prevention and detection, and for the 
 
12 
 
 NEW YORK CUSTOM-HOUSE. 
 
 prosecution of persons charged with the commission tin roof. Under tin seventh 
 section pf the same act, he is made the recipient and has sole control of the 
 books and papers seized from merchants by order of a judge of the district court 
 of the United States. Under tin* tenth section, as already particularized, with- 
 out his approbation no claim in favor of the United States can be compromised, 
 even by the Secretary of the Treasury. 1 
 
 It will thus be seen that, under these different acts of Congress, the Solicitor 
 of the Treasury has devolved upon him duties of the most responsible nature, 
 and requiring that officer not only to be learned in the law, but to be of the most 
 perfect uprightness of moral character. 
 
 In the practical administration of the laws to prevent frauds upon the reve- 
 nue, the Solicitor becomes of even more consequence than he is upon the statute- 
 book. In respect to all such matters he is really the confidential adviser of 
 the Secretary, who, amid his multiplied duties, cannot by possibility personally 
 inquire into all the questions arising between the custom-house and importers 
 in respect to such matters. When, therefore, a collector makes a charge upon 
 an importer, that he has meditated or committed a fraud upon the revenue, and 
 thereupon seizes his books, papers and merchandise, and the importer prefers a 
 petition for redress to the Secretary, tin; document is. in tin- course <>{' business, 
 referred to the Solicitor for report and advice. By reference to a circular re- 
 cently issued by the Treasury Department under date of January 23, 18G7, it 
 will be seen that the statutes provide but three modes in which an importer 
 whose merchandise has been seized can obtain possessi m of the same. 
 
 One mode is pointed out in the first section of tin; act of March 3, 1797, 
 (1 Stats., 506.) I>y reference to General Treasury Regulations, page 473, par- 
 agraph SSG, it w 11 be seen that under the last-mentioned act the importer 
 cannot obtain relief unless he distinctly admit* that he has incurred the forfeit- 
 ure complained oj \ The Treasury Regulations expressly say that the Secretary 
 will act on no application for remission, unless the forfeiture be admitted in the 
 petition to have been incurred. This admission being under oath, it could, of 
 course, be used against the importer on the trial, provided the Secretary should 
 refuse the prayer of the petitioner. 
 
 The second mode provided by the act of March 3, 18G3, only refers to cases 
 where the value of the merchandise does not exceed one thousand dollars. 
 
 The third mode is prescribed by the tenth section of the act of March 3, 
 1SG3, and specifically requires the recommendation of the Solicitor of the Treasury 
 to any compromise, before the Secretary can accept any compromise. 
 
 It is true that the President, by virtue of his geueral power over executive 
 business, can undoubtedly, if he sees fit, direct the district attorney to disc m- 
 tiuue any proceeding or prosecution begun on behalf of the United States. 
 Bat if an importer makes an application of that character to the President it 
 would be referred to the Secretary of the Treasury, who in turn would refer 
 it to the Solicitor. 
 
 Thus it will be seen that the Solicitor holds arbitrarily in his own hands, 
 both by statute and by actual practice, the fate of every application made by 
 an importer for redress on account of seizure or prosecution begun by collectors 
 of customs. 
 
 Again, collectors of customs are not subject to the orders of any person, 
 except to orders of the President, or the Secretary of the Treasury, or the 
 Solicitor of the Treasury. If, therefore, the interference in their performances 
 of these three officers can be prevented, the importer is at the mercy of the 
 collector, and the latter can pursue and harass his business unmolested. It 
 will thus readily be seen that if there be an understanding, direct or im died, 
 between the collector or informer and the Solicitor of the Treasury, that the 
 latter is to receive pecuniary benefit to be paid on account of seizures, he is not 
 an impartial person within the meaning of the law, whenever an application, is 
 
NEW YORK CUSTOM-HOUSE. 
 
 13 
 
 preferred for a release. He is, if he has a pecuniary interest in the result, not 
 a proper person to advise the Secretary of the Treasury. If the law contem- 
 plated that the Solicitor should have any interest in seizures, direct or indirect, 
 it would have given it to him by statute, as is done in the case of the collector, 
 naval officer, surveyor, district attorney, and informers. The fact that Congress 
 has abstained from giving the Solicitor any share is presumptive evidence that it 
 did not intend he should receive any ; and if the Solicitor is interested in such 
 seizures, he therefore ofTends against the spirit of the acts of Congress, and 
 makes himself an unfit adviser of the Secretary of the Treasury, and the more 
 unfit if it be that the Secretary is unaware of the pecuniary interest he has in 
 the subject upon which he is giving advice. 
 
 Theperusal of the testimony of Mr. Chittenden, former Registerof the Treasury, 
 detailing the particulars of an interview at the Fifth Avenue hotel, New York, at 
 which Mr. Jordan was present, certainly seems, by reason of his acquiescence on 
 that occasion, to engender the suspicion of his having a common interest with cer- 
 tain custom-house officials in consultation there — officials who had by law a re- 
 cognized divisible interest in the settlement of seizure and forfeiture cases. 
 
 The committee believe the seventh section of the act of 1863 bad in principle, 
 bad in practice, and should at once be repealed or greatly modified. The abuses 
 perpetrated under it are multiplying and intensifying, and may ultimate in some 
 baleful outbreak, in vindication of the inalienable rights of the citizen and the 
 man. While a wise and good officer would not knowingly use its provisions to 
 abuse or oppress, inasmuch as the administration of such cannot always be se- 
 cured, is it well to have unnecessarily laws capable of abuse in the statute- 
 books ? Even the era of good laws has not been exempt from administrative 
 abuses. Blackstone fixes upon the reign of the festive and unprincipled Charles 
 the Second as the period in English history of the theoretical perfection of public 
 law, though the times then, and that followed, he says, " were times of great 
 practical oppression." The conjunction of bad laws and bad men to administer 
 them would be most calamitous — a contingency that ought not to be needlessly 
 incurred. 
 
 The most material of the testimony taken recently by the committee, illustra- 
 ting the bearings and tendencies of proceedings under this act, as the same have 
 transpired in New York, is herewith submitted. 
 
 In 1864, and in 1865, the Committee on Public Expenditures submitted re- 
 ports incidentally touching the seizure system. Although then comparatively 
 in its infancy, its administration gave rise to reports that the custom-house officials 
 were oppressive in enforcing the laws regarding frauds upon the revenue, and 
 that seizures were made when the facts did not warrant such harsh proceedings. 
 The testimony then taken, almost incidentally, showed cases of hardship and 
 great oppression, but scarce sufficiently numerous and general in their character 
 to authorize the asking the corrective of special legislation. 
 
 The present condition and aspect is quite different. Abuses have greatly 
 multiplied ; revenue officers have from habit become more fearless, if not less 
 scrupulous, in their proceedings, until intervention and protection by legislation 
 seem absolutely needed by the mercantile community. Certainly something, 
 somewhere and somehow, is wrong, to beget an apprehension, at home and abroad, 
 that our seizing revenue laws are worked more in the interests of informers and 
 seizing officers than to protect the honest merchant and the revenues of the 
 government. 
 
 The committee are well aware the duties properly devolving upon the seiz- 
 ing officers are not pleasant, and by no means such as to render their interposi- 
 tion generally agreeable. But they are also well aware that official fidelity 
 does not require, even in the performance of an ungracious duty, the disregard of 
 the commonest courtesies of society, or the indulgence of coarse rudeness and 
 insolence. Instances of such manifestations, not creditable to the service, ap- 
 
14 
 
 NEW YORK CUSTOM-HOUSE. 
 
 pear in the testimony. Menaces and intimidation have been freely retailed I o, 
 
 to inline speedy settlements by compromise. By these compromise tin.- col- 
 ieetOT, Surveyor, and naval officer, and in New York the he id of tin- seizure 
 bureau, Albert Hanscom, at once realize an amount cert tin, and thus avoid the 
 law's delay and proverbial uncertainty. 
 
 It may he well to dwell a moment on the manner these eo m piomitai are 
 made up, and how the interests of the government arc snl> >rdinated to the divi- 
 sible interests of tbe Beizing officers, 
 
 The committee feel they cannot too pointedly condemn the practice which has 
 grown up in the different custom-houses of failing to secure and pay into the 
 treasury the full amount <>f duties, all of which belongs to the government by 
 
 law. The facte heretofore presented by the committee in reaped to the com- 
 promise of the alleged fraud in the importation of champagne wine into the 
 port of Boston by the Messrs. Williams, afford an illustration of the evil to 
 which we refer. In that case the collector asserted that the Messrs. Williams 
 had tailed to pay the full amount of duty legally chargeable upon the importa- 
 tions, and upon that ground seizure was made. A hundred thousand dollars 
 was paid in settlement of the case, of which the treasury only received one-half, 
 the amount having all been treated as a penalty or forfeiture, subject to division 
 and distribution under the act of 1709. It is clear, however, that if the govern- 
 ment had been defrauded of duty, the first thing that should have been done 
 was to secure that duty to the treasury. After tin* revenue had been satisfied, 
 then it would remain for consideration whether an additional sum by way of 
 
 penalty or punishment should be demanded of the importer. This settlement, 
 
 however, was, Under the tenth section of the act of 1863, approved by the Soli- 
 citor of the Treasnry, and his action was sanctioned by the Secretary of the 
 
 Trea&ury. The committee, however, cannot believe that the attention of tin* 
 Secretary was by the Solicitor called to the point we are BOW considering, in that 
 or otht r similar cases where his sanction has been required and obtained. 
 
 In New York the committee found that it was a habit of tie* collector to con- 
 sent to the delivery of merchandise under seizure to the importer upon the pay* 
 ment of a certain sum, which sum included an amount I'm]- duties the attempt 
 to evade the payment of which constituted the fraud which led to the seizure. 
 It is then the practice of the collector not to deduct from the sum received in 
 settlement the amount of duty and deposit the same with the treasury, and then 
 divide the remainder, but to divide the whole gross sum. 
 
 In effect this is dividing and distributing the duties with, and as well, as the 
 penalties and forfeitures. The case and the testimony of J. S. Beecher illus- 
 trates this point. For alleged frauds in undervaluations he had $70,000 worth 
 of wines seized, together with his books and papers, and his store taken posses- 
 sion of in the month of November, 1S66. The first tangible proposition for 
 compromise and settlement, on the part of the custom-house, was tor S^o.OOO. 
 Beecher, finding the actual duty on his wines would be about 812,000 in gold, 
 and that if he compromised he got back his wines free of duty, and at once got 
 himself, store, books, &c, out of trouble, paid $3/), 000 in greenbacks. The 
 government got half, SI 7, 500, at the then price of gold — not the duties, no- 
 thing for alleged violations of law — and the seizing officers divided among them- 
 selves $17,500. If out of the compromise payment government had first re- 
 ceived the duty, and then half of the residuum for evasion or violation of revenue 
 laws, the remainder might have been divided properly according to law. 
 
 Now if the main purpose which the laws inflicting penalties and forfeitures 
 have in view is to secure the payment of the fail amount of legal duty, then all 
 such cases as that of Beecher's, and that is only a representative one of many, 
 is a deliberate wrong, if not raid, upon the revenue, perpetrated by those who 
 profess to be very zealous custodians of the same, and so acting in the very 
 midst of the perpetration. Collection of duty is presumed in law to be the 
 
NEW YORK CUSTOM-HOUSE. 
 
 15 
 
 principal object, and infliction of penalties and forfeitures but ancillary to 
 that end In practice, however, and in the compromise of seizure suits, the 
 means and the resulting divisions have been made the principal objects. 
 
 The committee, therefore, urgently recommend that provision shall be made 
 by law that in no case shall there be a settlement of any fraud upon the revenue 
 which does not contemplate, first of all, a payment into the treasury of the full 
 amount of duty which has been evaded or withheld. 
 
 The language used in the fifth section of the act of March 3, 1S63, may per- 
 haps be read as authority on the part of Congress, in cases where goods seized 
 for violation of the revenue law do not exceed in value one thousand dollars, to 
 deliver the same to the importer on payment of that sum, without exacting any 
 additional sum for duty, and then permitting the whole amount of one thousand 
 dollars to be distributed among seizing officers for forfeiture. It does not, 
 however, deceive the country that such could not have been the intent of Con- 
 gress, because it is against the whole spirit of the revenue system to permit du- 
 ties to be included and divided as forfeitures. At any rate, it is clear the fifth 
 section of the act cannot be made to apply to cases where the amount exceeds 
 one thousand dollars, and it may deserve consideration whether, upon this point, 
 the fifth section does not need amendment. 
 
 But to return to the merchant whose store, goods, and papers have been 
 seized. He knows that his credit is injured, once it is whispered in Wall street 
 that he is in difficulty with the custom-house ; he knows, too, that if the report 
 of such an imbroglio gets abroad, his foreign credit is impaired, if not destroyed ; 
 he knows, too, that without the possession of his store he cannot sell his go >ds 
 and meet his paper ; he knows, too, that without his books and papers he cannot 
 arrange his balances or make his collections. In this garroting grip, therefore, 
 often it is simply a question with him, shall I give up a part and save some- 
 thing, or stand and contend, not with the harpies of the law, not with the mere 
 minions of office, but with the myrmidons of the government itself ? Is it any 
 wonder, then, that, though conscious of no wrong, of perfect rectitude of inten- 
 tions, when brought into the dissecting room of the seizure bureau, he surceases 
 opposition, allows the flesh pounds, blood and all, to be taken, and goes out, 
 perchance, not a malcontent, but with new views of the laws and justice of his 
 country. 
 
 The returns or dividends secured by the operations of this seizure bureau have 
 been large indeed, sufficiently, it would seem, to enable the participants to dis- 
 regard the obloquy engrndered by their proceedings. 
 
 Mr. Ogden, auditor of the custom-house, on request, furnished figures that 
 give some idea of the extent of these amercements. 
 
 Mr. Denuison, naval officer a little over four years, exclusive of a large an- 
 nual salary, received, for fines, penalties, fee., 8114,704 27. It is said he has 
 a divisible interest in seizure cases and trials contingent upon their adjustment 
 and determination amounting to over 8300,000. 
 
 Mr. Abram Wakeman, surveyor from October, 1S64, to December, 1S67, has 
 already received from same source 8101,206 14. He, too, has a very large in- 
 terest in the undetermined seizure cases. 
 
 Mr. Hanscom, head of the seizing bureau, in addition to his salary as deputy 
 collector, is allowed to toll, for his individual benefit, three or five per cent, of 
 the gross divisible amount before any division takes place. 
 
 It might, perhaps, be asked if such fair expectancy aids in the right con- 
 sideration and conclusion of the cases upon which he is officially and authorita- 
 tively to pass ? 
 
 The collector receives, with the surveyor and naval officer, an equal distribu- 
 tive share of the proceeds of the seizing business. The respective amounts 
 received by General Dix as naval officer, by Mr. Smythe as collector, to January 
 1, 1867, appear in Mr. Ogden's testimony. 
 
1G 
 
 NEW YORK CUSTOM-HOUSE. 
 
 The late treasury regulation of January 23, 18G7, and Senator I Ifleswell'f 
 bill requiring payment of duties or an equivalent before seized goods are released 
 
 and before, any consideration and dispositioa of the divisible interests take places 
 If carried out, will, very properly, much reduce tttese enormous receipts. 
 
 The fnodut Qftrandi under tin- act of J.Mj.'J is simple, suininai y, and severe. 
 
 Somebody is procured to give the information required ; a custom-house inspector 
 may make affidavit of suspicion that some merchant has imported without pay- 
 ment of the duties legally chargeable thereon, and that invoices, books, and pa- 
 perl relating to such merchandise and fraud are deposited in and upon the place 
 and premises, <Scc Thereupon a district judge issues his warrant, armed with 
 which the store is taken possession of, books, papers, letters, &c, are seized and 
 carried to the custom house, with a hope and expectation thai an examination of 
 
 them will furnish sufficient evidence to <.-taUi.-h tin- fraud What sort of 
 
 papers are, or may be, and have been, taken, appears in the testimony of Henry 
 Barbere. In that case a will, letters between husband and wife, cVc, were re- 
 garded as within the .-cope of the warrant, and were in the hands oi the officers 
 executing the precept. 
 
 It is thus apparent that proceedings of a very grave character, involving the 
 sanctities of the household and the inii ingement of the most sacred human rights, 
 are by this act supposed to he placed in tin; hands of govern meat officials. 
 Js not such procedure a virtual overthrowing or overleaping of constitutional 
 harriers, t<> erect and cement which cost the thought* and the toil, and the blood 
 of centuries 1 Is it not tin- needleSH subjection of our citizens to indignities and 
 oppressions such as have not been attempted in the last two hundred years 
 elsewhere — in any age or laud where the English language has been or is the 
 birth-tongue of the people / 
 
 It has been forcibly said that if there be one legal principle the roots of which 
 are more deeply embedded than another in English and American jurisprudence, 
 it is that no man shall be compelled to accuse himself. Can a man be compe lled 
 by indirection to furnish that proof against himself? 
 
 Chief Justice Marshall, in the Burr tiial, (vol. 1, p. 244,) undoubtedly stated 
 the law on this point correctly when he said: "Many links frequently compose 
 that chain of testimony which is necessary to convict an individual of a crime. 
 
 * * * No witness is compellable to furnish any one of them against him- 
 self. * * * A witness, by disclosing a single fact, may complete the testi- 
 mony against himse lf, and, to every effectual purpose, accuse himself entirely, as 
 he would by stating every circumstance which would be required for his con- 
 viction. * * * The rule which declares that no man is compelled to accuse 
 himself w. uld most obviously be infringed by compelling a witness to disclose 
 a fact of this description." 
 
 In the judiciary act of 1789 it was declared federal courts shall have power 
 on certain conditions " to require parties to produce books or writings in their 
 possession or power which contain evidence pertinent to the issue in cases, and 
 under circumstances when they might be compelled to produce the same by the 
 ordinary rules of proceeding in chancery." In the case of the United States vs. 
 Twenty-eight Packages, (Gilpin's Reports, 306,) it was held that a suit in rem. to 
 enforce a revenue forfeiture is not within that act, and books and papers cannot 
 be forced out of the implicated party, even on trial. It is believed that no 
 court of competent jurisdiction has held, in this country, that " it was within the 
 power of the government, on the trial of an issue of forfeiture under the revenue 
 law, to compel a party to bring into court, as evidence, books and papers to 
 procure his own condemnation." 
 
 Nay more, it is a familiar doctrine, that "when books and papers are actually 
 produced on the trial, the prosecuting officer for the United States is not per- 
 mitted by the court to ransack and search them at will, but is required to call 
 for a particular paper, or letter, or account, so sensitive is the law in respect to 
 
NEW YORK CUSTOM-HOUSE. 
 
 17 
 
 the secrets of business and trade." Well and properly has it been asked, what, 
 if any, is the legal distinction in this respect "between compelling an accused 
 party, or owner of inculpated merchandise, to express verbally his own con- 
 demnation, or betray himself by being compelled to produce a paper or a book 
 in which he has written that which, if made public, would produce the same 
 result % Has Congress any more constitutional power, by ransacking private 
 drawers and forcing a banker's safe, to secure admissions from a citizen which 
 condemn his property, than it has to obtain evidence by extorting confessions 
 from an individual by the rack and thumb screw ?" 
 
 Time will not permit such elucidation and elaboration of this principle as its 
 importance demands. But it is very evident that the 7th section of the act of 
 1863, and the custom-house practice under it, is in opposition to, and in violation 
 of, the whole current of English and American law, and of the spirit and the 
 words of our own Constitution. 
 
 Let us look at a consequence that may legitimately follow. On an affidavit 
 of suspicion that somebody has made, a judge issues a warrant directing an 
 officer and his assistants to " enter any place or premise where any invoices, 
 books, &c, are deposited." From malice or mischief the (usually) irresponsible 
 affiant may depose such a number and street to be that ''any place or premise" 
 and that number happens to be a private dwelling. They enter — the law allows 
 it ; and thus what the sovereign of England unbidden dare not do to the poorest 
 man's cottage in her realm, a petty officer and his assistants from the staff of 
 the surveyor of the port may with impunity do, cross and re- cross, unbidden and 
 unpunished, the threshold of an American citizen. 
 
 In abolishing hearth-money, the first statute of William and Mary declared 
 that the " exposing of every man's house to be entered into and searched at 
 pleasure by persons unknown to him, was not only a great oppression to the 
 poorer sort, but a badge of slavery upon the whole people." 
 
 More than a century ago, the plaintiff's counsel in one of the important trials 
 of that period said, " Ransacking a man's secret drawers and boxes to discover 
 evidence against him is like racking his body to c >me at his secret thoughts." 
 Afterwards, Lord Camden, when chief justice of the common pleas, is recorded 
 as having used these words in rendering a decision fo.- the plaintiff: 
 
 " Papers are the owner's goods and chattels ; they are his dearest property, and are so far 
 from enduring a seizure, that they will hardly bear an inspection ; and though the eye cannot 
 by the laws of England be guilty of a trespass, yet where private papers are removed and 
 carried away, the secret nature of those goods will be an aggravation of the trespass, and 
 demand more considerable damages in that respect. Where is the written law that gives 
 any magistrate such a power ? I can safely answer, there is none ; and, therefore, it is too 
 much for us, without such authority, to pronounce a practice legal which would be subver- 
 sive of all the comforts of society. But though it cannot be maintained by any direct law, 
 yet it bears a resemblance, as was urged, to the known case of search and seizure for stolen 
 goods. I answer, the difference is apparent. In the one case I am permitted to seize my 
 own goods, which are placed in the hands of the public officer till the felon's conviction shall 
 entitle me to restitution. In the other, the party's own property is seized before and without 
 conviction, and he has no power to reclaim his goods, even after his innocence is cleared by an 
 acquittal. Lastly, it is urged as an argument of utility, that such a search is a means of 
 detecting offenders by discovering evidence. I wish some case had been where the law 
 forceth evidence out of the owner's custody by process. There is no process against papers 
 in civil causes. It has been often tried, but uever prevailed. It is very certain that the law 
 obligeth no man to accuse himself ; because the necessary means of compelling self-accusa- 
 tion, falling upon the innocent as well as the guilty, would be both cruel and unjust; and 
 it should seem that search for evidence is disallowed upon the same principle. There, too, 
 the innocent would be confouuded with the guilty. Observe the wisdom as well as the 
 mercy of the law. The strongest evidence before a trial being only cx, -parte, is but suspicion; 
 it is not proof. Weak evidence is a ground for suspicion, though in a lower degree ; and if 
 suspicion at large should be a ground of search, whose house would be safe ?" 
 
 Burke afterwards admirably summarized, in two sentences, the principles 
 settled by that and kindred decisions during the Wilkes epoch of English, juris- 
 prudence : 
 
 H. Rep. Com. 30 2 
 
18 
 
 NEW YORK Cl.'STOM-HOUSE. 
 
 " The personal liberty of the subject was confirmed l>y the resolution against general var 
 
 tii nts. 
 
 "The law tnl lecrete of bnsinen and friendship were rendered inriolable by the resolution 
 
 for Condemning the seizure of jtnj/e.rs." 
 
 Little more than twenty years later, wlien all these discus-ion- and decision- 
 wore fresh in the public mind, our federal Const itutinn was framed, and, says 
 a late decision of our own Supreme Court, "the founders of our government 
 were familiar with the history of that struggle, and secured, in a written con- 
 stitution, every right which the people had wiested from power during a contest 
 of ages." 
 
 Alexander Hamilton said, in the 84th number of the Federalist, that our 
 Original federal Constitution "adopts, in their full extent, the common and 
 statute law of Great Britain, by which many other rights not expressed in it are 
 equally secured." 
 
 But so careful and so determined were our fathers to guard against any pos- 
 sible misapprehension as to individual immunity from searches and seizures, \c, 
 that one of the fust series of amendment.- to the Constitution declare-, "the 
 right of the people to be secure in their persons, houses, ju/pcr.s, and effects, 
 against unn a.-onable searches and seizures, shall not be violated." 
 
 In the hasty preparation of this report, the committee have not noticed any 
 judicial deliverance as to what will be held " unreasonable ;" but they are very 
 clear that to cause .-tores, drawers, safes, &c , to be opened and rilled of books, 
 letters, papers, tVc, without other judicial inquiry and determination than is im- 
 plied in the formal production of an affidavit and formal issuance of a warrant — 
 and that is all the examination and deliberation most cases receive — ought to 
 be deemed " unreasonable, " and unjustifiable and unlawful, in any civilised 
 country professing the semblance of a constitution. And it imi.-t not be for- 
 gotten that it is specially provided in the last clause of the 7th section that 
 these invoices, books, papers, &c, "shall be retained," "so long as the retention 
 thereof may be is necessary," "subject to the control and direction of the Solicitor 
 of the Treasury." 
 
 But the committee have said enough, and much more will be found in the 
 testimony. Surely such proceedings are against the spirit of our institutions, 
 and in direct conflict with the spirit and words of our Constitution ; and the 
 committee cannot believe, when understood, a provision such as the 7th section 
 of the act of 1863 is claimed to embody will be allowed to remain without 
 essential modification. 
 
 Closely connected with the seizure business at home, and forming a very im- 
 portant auxiliary of it, is what may be designated as the government detective 
 system abroad. 
 
 Immediately following upon the passage of the act of 1863, Willard B. Far- 
 well and Montgomery Gibbs were formally designated by the Treasury Depart- 
 ment to obtain in Europe evidence of alleged frauds in the under-valuations 
 contained in invoices of merchandise destined for the United States. 
 
 The committee called before them the Solicitor of the Treasury, whose bureau 
 has had the especial working and control of this system, and he explained fully 
 his views and experience in relation thereto. For the purpose of information on 
 this and other branches of the investigation committed to them, the committee 
 asked the Secretary of the Treasury to request Mr. Far well to return to this 
 country and report for examination. Mr. Far well came and appeared before the 
 committee and gave his views at length. Mr. Montgomery Gibbs also came be- 
 fore the committee, and gave them the benefit of his experience and views. 
 
 The statements of these three gentlemen, containing, as they doubtless do, the 
 best plea for, and defence of, the detective system which it admits of, though 
 quite voluminous, are given in full in the accompanying testimony. As all the 
 advantages of the system are r from their different stand-points, therein set forth;, 
 
NEW YORK CUSTOM-HOUSE. 
 
 19 
 
 the committee content themselves with some of the objections that forcibly pre- 
 sent themselves, to the continuance of the system, and, in their judgment, would 
 justify, if not require, the recall of those detectives and the abandonment of 
 such an adjunct of our customs revenue service. 
 
 The character two of these men bore at home ought not to be lost sight of, 
 especially as they sometimes represent themselves abroad as accredited agents 
 of a department of the government. The estimate in which Mr. Gibbs is held 
 by those who were associated with him in business, and socially, when he re- 
 sided, as he did several years, in New York, would not commend him as a 
 desirable exponent, advocate, or representative of an individual enterprise re- 
 quiring responsibility, integrity, and veracity. 
 
 The testimony of Lucien Birdseye, Mr. Seeley, and several other witnesses, is 
 very direct in these respects. 
 
 It would also seem from the testimony that he has not made for himself abroad 
 an enviable reputation. Perhaps the very nature of his vocation there prevented 
 a different result. It is well nigh impossible to conceive that a gentleman and 
 a man of honor, as should be the representative of the American name abroad, 
 could resort to shifts, disguised names, constant misrepresentations, purposely 
 to mislead, deceive, and entangle. 
 
 The Bourbon dynasty had their "agents provocateurs " or provoking agents ; 
 but their operations were mostly confined to French soil and to the lower strata 
 of the French society of that age. 
 
 The question presents itself for consideration, whether a person of such ante- 
 cedents and practices should be employed abroad to collect information and 
 evidence upon which government depends in prosecuting important revenue 
 suits. 
 
 In some respects and to some extent the same remarks are suggested and the 
 same queries arise as to the employment of W. B. Far well in the revenue service 
 abroad. 
 
 He too went abroad with not the best reputation where best known. He too 
 has appeared in various places, in various guises, and as the writer of various 
 fictitious or forged letters to obtain information, samples, specimen casks of 
 wine, &c. ; in some instances, certainly one, as the witness Joseph Bensusan 
 testifies, forgetting to pay for his wine samples. 
 
 If the testimony of James Myers, jr., can be relied upon — and the committee 
 know no reason why it cannot — Messrs. Farwell and Gibbs did not scruple to 
 hunt in couples at Cologne, representing themselves as confederates desirous of 
 pricing wines, &c. Anon they are Canadians, Englishmen, &c. In further 
 illustration of the questionable proceedings of Mr. Farwell, the Swiss consul 
 general, Hon. John Hitz, produced before the committee the certified originals 
 of certain papers, wherein it seemed probable that Mr. Farwell had possessed 
 himself of four valuable gold watches as samples of a seizure he had instigated 
 in California. The sworn copy appears in the accompanying evidence of this 
 report. 
 
 How his associate, Gibbs, proposed to levy contributions on merchants con- 
 signing goods to the United States, is fully set forth in the testimony of Leuch- 
 tenroth. Witness's letter, appended thereto, gives details of transactions and 
 intentions in which Mr. Gibbs appears in still another character. Mr. Gibbs 
 gives in his testimony his own version of these matters. 
 
 The committee have neither time nor inclination to consider further the especial 
 personnel of these treasury detectives. A mass of testimony bearing on them 
 and their proceedings is herewith submitted, sufficient, it is believed, to satisfy 
 any dispassionate mind that, admitting the system is a proper one in its object 
 «iud plan, these men should not be intrusted with its working at home or abroad. 
 
 Away from home observation, inspection, and responsibility, surrounded by 
 inducements, such opportunities and temptations might easily prove sufficient 
 
20 
 
 NEW YOKK (TSTOM-IIOUSE. 
 
 to corrupt and overt!. row the strictest uprightness and Steadfastness. Information 
 legitimately obtained and easily Bold, opinion?* and representations paid for, with 
 but a chance of exposure, might embolden even the most timid and inexperienced. 
 Allowed to Bay authoritatively to collectors of ports in this country what an* 
 Correct and what are undervaluations — in other words, what is to he permitted 
 and what is to he seized — an enormous power may at any time he thus exer- 
 cised over a large shipper, however honest. The shipper paying would be 
 allowed to pass; the shipper refusing to pay would be annoyed inevitably, 
 if not made a seizure victim. 
 
 The possession of this power, and the ahility to exercise it, were more than 
 intimated in the California watch papers, already referred to. 
 
 Large seizures are made hy proof thus worked; if compromised, one-fourth of 
 the whole amount received goes to them as informers; if the suit - are tried and 
 government loses, government pays the costs. 
 
 In other words, inclining neither expense nor risk, upon their own represent- 
 ations they are permitted to initiate expensive law proceedings, damaging if 
 not disastrous to large interests ; clad themselves in the habiliments of special 
 agents of the treasury i at a distance, scathless and harmless, they beat the 
 cover, and only appear when the prey is brought down. 
 
 Already the operations of the system ahroad and at home are assuming na- 
 tional importance. Large seizures have heen made of shipments of champagne 
 wines from France, ribbons, silks, watches, &c, from Switzerland, and sherry 
 wines from Spain, after arrival and entry at our custom-houses, upon previously 
 agreed valuations, opou the pretence of fraudulent undervaluations, to the ex- 
 tent of nearly destroying some lines of our foreign trade. It is understood and 
 believed that very decided representations have already been made to the Sec- 
 retary of State as to the propriety and justice of the course pursued. The end 
 is not yet. 
 
 The champagne seizure cases, perhaps, afford a fair illustration of the magni- 
 tude of some of the interest- involved, means and instrumentalities used, and 
 results reached and not reached. 
 
 Under information sent to the New York custom-house by Mr. Montgomery 
 Gibbs, about ten thousand cases of champagne wines, amounting in value to 
 about 5140,000, consigned to the different agents at New York of the manufac- 
 turers at Reims, France, were seized t-arly in 1864, upon the allegation that 
 the invoices accompanying the same, and on which entry was made at the cus- 
 tom-house, contained false valuations. Suits were also instituted to recover the 
 value of importations which had already passed the custom-house as correct, the 
 amount of which reaches the enormous figures of $1,820,600. The agents of the 
 manufacturers have vainly endeavored to have the cases brought to trial, and thus r 
 as they claim, be allowed to make an exposition of the character and honesty of 
 the business of their principals in their dealings with the United States. It was 
 testified before the committee that the business connected with champagne wines 
 consigned to the United States is peculiar. It is confined to a few manufac- 
 turers who reside at Reims and Eperuay, in the so-called champagne districts 
 of France. All the manufactured wine is made from the " brute" or crude wine 
 grown in that district ; each manufacturer makes a different champagne, varying 
 in taste to suit the taste of the consumers who fancy his particular brand, and 
 these wines are subject to frequent variations in the demand. Sometimes the 
 Heidsick has been the prime favorite, again the Mumm, or again the Veuve 
 Cliquot. A wine is made suitable for the United States market by so mixing it 
 that it suits the American taste, and as it is made expressly to suit that taste, 
 this wine would not be merchantable, or command a remunerative price, if it was 
 sent for sale to England, Russia, Germany, &c, nor even in Reims would the 
 wine of one manufacturer be salable to other manufacturers, owing to this dif- 
 ference in taste and the reputation of the brand. Again, the reputation of the wines 
 
NEW YORK CUSTOM-HOUSE. 
 
 21 
 
 in the United States is made through the agents of the manufacturers at Xew 
 York, who control the entire consignment for the United States, and the wine is 
 sold more from the label or brand than any other cause ; each wine has its admirers 
 in this country, the variation of demand being based upon the taste of individ- 
 uals lor each wine. 
 
 When the duty on champagne was changed to an ad valorem basis under the 
 tariff of 1846, the manufacturers were at a loss how to invoice the wine, and 
 immediately after the taking effect of that tariff the matter was submitted to the 
 United States appraisers by the agents of the wine, for advice as to how the 
 wine should be invoiced, and after a full exposition of the cost of manufacture 
 to the government officers, '* the appraisers fixed the price entirely upon their 
 own information and judgment, independently of the importers, who were com- 
 pelled to accept the appraisers' decision." 
 
 After this agreement on the part of the government with the agents of cham- 
 pagne manufacturers, there was no difficulty with the entry of this merchandise 
 at the United States custom-house until these prices were brought in question 
 through the operations of Messrs. Gabbs & Farwell in obtaining retail or maxi- 
 mum prices at Paris and elsewhere, which is not the principal market for cham- 
 pagne wine, and where no wholesale price for champagne wines seut to America 
 is known. 
 
 THE SHERRY WINE CASES. 
 
 The present status of these seizure cases may, perhaps, be named in two 
 sentences. 
 
 A long correspondence has been carried on relative to the manner in which 
 Mr. Farrell, our consul at Cadiz, has transacted the business of his office. Com- 
 plaint was made by the Spanish government that he had refused to sign the in- 
 voices of wines which were presented for shipment, intended for the United 
 States, by supposing the true prices of such wines were higher than those ex- 
 pressed in the invoices. 
 
 Mr. Tassara, the Spanish minister at Washington, speaks of the arbitrari- 
 ness of the consul, and of his doing serious injury to the merchants, and inti- 
 mates that reclamations may be demanded. 
 
 THE SWISS CASES. 
 
 The history of these cases can be best known by a few extracts from the 
 communication of the consul-general of Switzerland, addressed to the Secretary 
 of the Treasury, under date of February 9, 1867, and likewise handed by the 
 consul to the committee. Several extracts of similar correspondence will ap- 
 pear in connection with the testimony of the consul-general. 
 
 Consulate General of Switzerland, 
 
 Washington, D. C, February 9, 1^67. 
 
 Sir : In submitting herewith the accompanying statements of silk manufacturers of 
 Switzerland, relative to the charge of alleged undervaluation made by Mr. W. B. Farwell 
 and others, the undersigned would briefly and most respectfully observe — 
 
 1. It is evident that Mr. Farwell, in the zealousness of his office as secret agent of the 
 United States revenue department, pursued a line of action calculated to secure maximum 
 price lists, and not to establish the minimum or actual market value. 
 
 •2. That Mr. Farwell's charges of undervaluation are not based upon facts or actual sales; 
 but, on the contrary, from a want of proper knowledge of the silk trade in Switzerland, he 
 has been led to grievously wrong Swiss manufacturers, and impugn the integrity and 
 efficiency of United States consuls. 
 
 3. It must be readily admitted that Mr. Farwell's mode of obtaining merely prices by no 
 
22 
 
 NEW YORK CUSTOM-HOUSE. 
 
 means determines actual market value, and if assumed as a basis for the levying of .lurii m 
 ■would make all consular certificates superfluous, and totally demoralize tin- export trade to 
 the I 'idled States. 
 
 With assurances of high consideration, the consul-general of .Switzerland, 
 
 JOHN 1111/. 
 
 The Hon. HUGH MCCULLOCH, 
 
 Secretary of (lie 'irt usury of the United States. 
 
 Want of time forbids farther consideration of tlx* seizure system and busim . 
 
 A few words may, however, la? allowed to tin* connection and agenev our con- 
 suls have in the foreign featnre of out revenue system; especially as much of 
 the error and inexactness which prevails in foreign countries in making up in- 
 voices of merchandise consigned to the I'liiled States hy manufacturers, lor sale 
 on their account, arises from the ignorance or misconduct of our consuls abroad. 
 Formerly, consulates were mostly sinecures in certain localities ; this is not the 
 case at the present day. Hy recent legislation and circular instructions from 
 the Slate Department, in all large manufacturing and exporting district s. United 
 States consuls are made quasi appraisers. By the act of August 18, 18.16 ; the 
 eighteenth section of tarift" act of. July 11 ls(J:2; the first section of act of March 
 3, lSn:* ; and the consular instructions from the Department of State, consuls 
 are made responsible for the correctness of invoice valuations. These statutory 
 provisions and department regulations require consuls not only to he learned in 
 revenue laws, hut to he experts in the value of the merchandise sent from their 
 consular districts to the United States. If, there tore, a consul approves the in- 
 voice value of an article for a series of importations, has not the foreign producer 
 some right to assume that to he the true value for revenue purposes, just as 
 much as he would if the appraisers here approvi d the valuation ? And yet, all 
 consuls are not intelligent. The committee had before them a letter written to a 
 foreign merchant by the consul-general of the United States at Frankfort, dated 
 December 7, 1863, informing him that under the law of March 3, 1863, wines 
 consigned by the manufacturer must be invoiced at the " cost price of manu- 
 facture," instead of "actual market value." With such official expositors of our 
 often changed tariff laws, can it be surprising that foreigners are misled ? So 
 long as our duties are assessed upon foreign valuations ought we not to see that 
 our consulates are filled abroad by intelligent, experienced, and faithful business 
 men ? Certainly it does not become us to be surprised or to complain that foreign 1 
 merchants misinterpret laws about which our own agents are ignorant. 
 
 In close connection with cur consulates is the requirement that the export- 
 ing manufacturer shall deposit, prior to or when he receives his certified invoice, 
 samples of the goods he is exporting. As an important aid to the judgment of 
 the consul, this requirement may be of great advantage, but it is also liable to 
 great abuse. 
 
 But, for the removal, comparatively, of the most flagrant abuses and frauds 
 in the working of our revenue system at home and abroad, and putting an effect- 
 ual stop to most of the present complaints of foreign manufacturers exporting 
 merchandise to the United States, there is, the committee believe, one simple 
 and practical course to be pursued, and that is to recall from abroad all treasury 
 Setectives, and, iu future revisions and adjustments of the tariff, substitute, as 
 rapidly and as entirely as practicable, specific in place of ad valorem duties. 
 
 Some irregularities in the surveyor's department of the Xew York custom- 
 house were brought to the notice of the committee : among other things, the 
 looseness with w T hich the baggage of passengers from abroad is sometimes 
 passed. It is said, on the northern frontier the reticules of females coming 
 across the line are required to be inspected, while in New York a foreign steam- 
 ship citizen passenger passes twenty-four (24) of twenty-five large trunks with- 
 out examination. A witness (Bemas) swears he saw that number of trunks so 
 passed last November, and that the surveyor, Mr. Wakeman, was at the time 
 
NEW YORK CUSTOM-HOUSE. 
 
 23 
 
 on the dock, and might, if he did not, have seen the transaction. Uniformity, 
 reform, or change would seem to be needed. 
 
 Captain Kellerman's testimony indicates a leak or defective working in the 
 seizure bureau in the imposition and collection of fines of vessels, steamers, &c, 
 for violation of revenue laws and coasting regulations. Why but five or six 
 vessels have been fined in New York out of one hundred and fifty ( 150) reported 
 is suggested, if not accounted for, in his evidence. 
 
 The same witness also swears to gross overcharges, and even bold swindling 
 of the government, in the charges for supplies furnished the several revenue 
 cutters stationed in and off the port of New York. 
 
 During its session in that city the time of the committee was too limited to 
 give this branch of the public service an adequate examination. Want of time 
 must also excuse other seeming neglects and shortcomings of the Committee on 
 Public Expenditures in not extending further investigations pressed at one time 
 and another upon their attention. 
 
 Somewhat to the same cause should be attributed some of the incongruities 
 admitted to pervade the report herewith respectfully submitted. 
 
 C. T. HULBURD, 
 J. M. BROOM ALL, 
 E. H. ROLLINS, 
 
 Sub- Committee. 
 
24 
 
 NEW YOKK Cl.'STOM-HOUSE. 
 
 New York, December 17, t866 
 Mr. FRANCIS M. BIX BY sworn and examined. 
 
 By the Chairman : 
 Q. What lias been your business 1 
 
 A. 1 have been for the last twelve yean engaged in the storage business; 
 our Btores are at 371 Washington street. 
 
 Q. Are you acquainted particularly with the manner in which that business 
 has been conducted in this city and if ho, please give the committee the benefit 
 of your experience and knowledge. 
 
 A. I would like to explain to the committee that the firm of which I was a 
 member, Humphrey & Co., prior to Mr. Smythe's going into office as collector, 
 had the general order business of* the North river. 
 
 Q. Will you please explain what the general order business is? 
 
 A. (The witness here read from the regulations of the warehouse department 
 as compiled from the revenue laws,) "AH goods unclaimed by the owner or 
 consignee, at the expiration of the period allowed bv law for the discharge of 
 the vessel in which the same may have been imported, will be sent by the col- 
 lector to the general order store of the district in which tie- vessel may be dis- 
 charging." I will now explain, that when a vessel arrives here and commences 
 to discharge her cargo, all goods thai are not permitted, or entered for bond in 
 some specified warehouse, are unclaimed goods, and are sent to a store which 
 the collector designates in the district, under a general order, which states that 
 all unclaimed goods shall be sent to a certain stoic, if, when they arrive, they 
 come under this clause of the law. (Heads again from the regulations of the 
 warehouse department :) 44 All unclaimed goods shall be received therein on 
 the order of the collector, and the proprietor thereof shall be liable for the safe- 
 keeping. And all charges for labor, storage, and other expenses on unclaimed 
 goods shall not exceed in any case the regular rates for like merchandise at the 
 port of importation." These rates are established by the Chamber of Com- 
 merce, and are recognized all through the city as meeting the provisions of the 
 law. The linn of Humphrey & Co. had a general order store prior to Mr. 
 Smythe's coming into othce. Their stores were located at 371 Washington 
 street, and 56 and 58 Greenwich street, and were built expressly for the storage 
 of general order goods as regards conveniences of store and location. (The 
 witness here produced a map of the city.) Take a line of Walker street for 
 the northern line, and south of that the importing merchants' warehouses are 
 chiefly located. Ninety-nine out of every hundred of them are within that 
 circuit. Very few importers are above Canal street. 
 
 By Mr. Rollins : 
 Q. Walker street does not run as far up as Canal street ? 
 A. At this side of it. 
 
 By the Chairman : 
 Q. Proceed. 
 
 A. The appraisers' stores are situated on the corner of Exchange Place and 
 Broadway, in the lower part of the city. It is just below Trinity church. Our 
 principal warehouse is situated in Greenwich and Washington streets, between 
 North Moore and Beach streets, about one mile from the appraisers' store. 
 (Witness again referred to the map.) I wish to show you here where the prin- 
 cipal shipping and steamers lie. This is pier 47, which is the principal pier — 
 about the uppermost pier in the city at which steamers land ; I mean the foreign 
 steamers engaged, in foreign trade, where these goods come from. Pier 36 is a 
 lower pier, and the steamers nearly all land within the circle between piers 36 
 
NEW YORK CUSTOM-HOUSE. 
 
 25 
 
 and 47. Pier 37 is right opposite 371 Washington street, the old general order 
 store. The principal general order business on the North river, the upper dis- 
 trict, is now being carried on at the corner of Bank street and Eleventh avenue. 
 When the goods are taken out of the general order store a certain number of 
 packages are ordered away to the appraiser's office for examination. The cartage 
 from 371 W ashington street to the appraisers' stores is $1 10 per cart-load, and from 
 Bank street I am unable at this moment to say. 
 
 By Mr. Rollins : 
 Q. What is the comparative distance ? 
 
 A. The cartage distances are divided off into half miles : sixty-six cents for 
 the first half mile, and twenty-two cents for each additional half mile. The other 
 warehouse for the lower district of the North river is situated in Bridge street. 
 
 Q Please answer my question. I want to get the comparative distances from 
 appraisers' stores to this new one, on or near Bank street. 
 
 A. The new general order store is about two miles further off from the ap- 
 praisers' stores than the one in Washington street. 
 
 Q. But yours was a mile distant ? 
 
 A. Yes. 
 
 Q. Then this mast be three miles 1 
 A. Yes, sir. 
 
 Direct examination continued : 
 A. Shortly after Mr, Smythe came into office, Mr. Humphrey, late member 
 of Congress, called on him to request that the general orders might still be sent 
 » to Humphrey and Company's warehouse, in Washington street and Greenwich 
 street. Smythe declined, and informed Mr. Humphrey that his friends, who had 
 been his earnest supporters and had secured his appointment and confirmation 
 as collector, were to have that business, and that they were so numerous it re- 
 quired all the general order business to satisfy them. Very soon after this con- 
 versation Mr George T. Thomson called on him, and stated that he and others 
 had the general order business of the North river, and wanted our warehouse to 
 do the business in ; that they would pay the accrued charges on goods in store, and 
 take our leases. Knowing Mr. Thomson's political status as editor of the Daily 
 News, and his having been at an early stage of the war arrested by order of the 
 Secretary of War, we had some doubt as to whether Mr. Smythe, a professed 
 Union man, had chosen Mr. Thomson as his confidential friend and champion. 
 
 By Mr. Rollins : 
 Q. Who was the proprietor of the Daily News ? 
 A. Ben. Wood was the owner of the Daily News at the time. 
 
 By the Chairman : 
 
 This doubt was dissipated by Mr. Thomson bringing a letter addressed 
 to Humphrey & Co., signed by H. E. Smythe, collector, in Smythe's own hand- 
 writing, stating that he had assigned the general order business of the North 
 river to Van Bergen & Co., and requested that we would arrange with the 
 bearer for the early transfer of the business. 
 
 By Mr. Broomall : 
 Q. Was Thomson named in that letter ? 
 
 A. Yea. Thomson reiterated his proposition, and we declined to sell out our 
 business. 1 asked Thomson who were his partners beside Van Bergen, and he 
 declined to state any further than that they were parties in Washington of large 
 influence and great expectations. Thomson then wanted to know if we would 
 give his concern three-fourths of our business, we to do all the work, furnish 
 
26 
 
 NEW YORK CUSTOM-HOUSE. 
 
 all the capital, assume all the responsibilities, and give his firm three-fourths of 
 all that wan made. This proposition we declined. We asked Thomson if the 
 business could be extended so as to leave it remunerative for us. Mr. Thom- 
 son informed us, as an incentive for accepting bis proposition, that the collector 
 would use liis own influence, and that of the department, to make the business 
 profitable< Mr. Humphrey asked Thomson, provided we relinquished three- 
 Fourths of our business on the North river, it the collector would not give us 
 
 part of the general orders on the East river. Thomson replied, that the col- 
 lector probably would do so; but he knew he would insist on retaining on that 
 river the same interest as had been proposed for the North river. At Thorn- 
 eon's suggestion Mr. Humphrey called to see the collector, with the view of as- 
 certaining if any arrangement could he made. Mr. Humphrey lefl the ollicc 
 where this conversation took place — 71 Broadway — and went directly to the 
 custom-house. In a short time he returned and informed us that he had seen 
 Collector Sinythe, and had been informed by him that only a lew minutes before 
 Mr. Humphrey called he (Sinythe) had sold the general order business for the 
 
 whole city to Miller & >ng >r for the round bq d of forty th >us m 1 dollars per 
 year. Mr. Humphry received from Sinythe, written in pencil 00 the back of a 
 letter which Mr Humphrey had, and which witness saw, the initials of the parties 
 who were to share this plunder. Sinythe was to retain ten thousand dollars for 
 an alleged political fund, Thomson five thousand dollars, Senator Patterson 
 
 five thousand dollars, Deputy Collector Embree's salary was to be increased to 
 five thousand dollars, and an offer was made to give Mr. Humphrey three thou- 
 sand dollars, which was indignantly declined. I think tie- way he was 
 treated was the im-ans of killing Mr. Humphrey ; he died of a broken heart. 
 His death, however, elicited, in a room attached to the collector's office', • 
 in which Thomson, Deputy Collector Embree and others were present, the 
 remark that there was one man less to divide with. This I have on good 
 authority. A small sum was spoken of for some woman, but cannot say if 
 she was in Washington. Another sum was mentioned to be paid to an 
 influential party in Washington, but secrecy having been imposed on Mr. 
 Humphry m this regard, no name or sum was meutioned. In this sale to 
 Miller Conger they undertook to bond the stores in which to do the general 
 order business. Their first effort in this direction was an attempt to bond what 
 is known as Getty's stores in Greenwich street. The government having been 
 in treaty for these stores for the use of the appraisers, did not bond them, nor 
 did Miller & Conger succeed in bonding any stores. Mr. Thomson also in- 
 formed me of this sale by the collector to Miller & Conger ; it was also a 
 matter of common notoriety. After the sale to Miller & Conger had exploded, 
 E. C. Johnson sent for me to call to see him at his office in Bridge street. In 
 company with my brother, Mr. B. H. Bixby, I called on him, when he informed 
 us he had the whole general order business for the whole city, and wanted to 
 know what we would give for the business of the North river. He told us he 
 knew all about the Miller & Conger arrangement, and had knocked it into a 
 cocked hat. That when he saw Miller & Conger had all the business for 
 forty thousand dollars, he weut to Smythe and offered him fifty thousand dollars 
 for it, and then went out of town ; and after a little while Smythe sent for him, 
 and he had the business. He said the other affair had been managed badly by 
 a man named Thomson, who was a secessionist, but it would be managed different 
 now, and with a view of avoiding any unpleasant consequences from an investi- 
 gating committee. We suggested to him two important reasons why we would 
 not buy the business, either of which would control us. First, the purchase and 
 sale of the business was a violation of the law, [witness here referred to the 
 statute of March 3, 18C3,] and we did not want money so badly that we would 
 run the risk of being sent to jail ; and secondly, the general order business of 
 the whole city, if fairly and decently conducted, would not begin to pay a profit 
 
NEW YORK CUSTOM-HOUSE. 
 
 27 
 
 of fifty thousand dollars a year. Johnson said nobody would know anything 
 about it, and therefore there would be no prosecution. He then responded as 
 an inducement for a large offer, that we could charge the merchants whatever 
 we pleased for storage, aud we would be protected and sustained by the collector. 
 That he (Johnson) would assume all the responsibilities for such charging, take 
 all the blame, and attend to that branch of the business himself. And though 
 he did not want to do any of the work, yet for attending to these little bills he 
 thought he should get something. We were not willing to entertain any such 
 terms, and so informed Johnson. He requested us to call on the following day, 
 and that perhaps we could arrange it satisfactorily. We did not call on this 
 man again, but sent him the following letter : 
 
 E. C. JOHNSOx\. 
 
 Sir : We cannot make you any proposition to-day in regard to the general order 
 business. We can hardly realize that the collector of the port would sanction 
 the sale of government patronage either directly or indirectly. Feeling a warm 
 interest in this business, we shall attentively watch all proceedings in connection 
 with it. And should our views change in regard to the morality and legality 
 of the transaction, we shall do ourselves the pleasure of calling on you. 
 
 B1XBY & CO. 
 
 By Mr. Rollins : 
 
 Q. What is the date of that ? 
 
 A. I have omitted that, but will supply it. 
 
 Finding Smythe determined to carry out this fraud, our firm, in connection 
 with the house of Squires & Co. and Frank Squires, sent the following pro- 
 position to Collector Smythe : 
 
 August 4, 1866. 
 
 Sir : The, undersigned, proprietors of the several warehouses which have 
 heretofore been designated to receive the storage of general order goods, propose, 
 if you will agree to continue their warehouses as the depositories for such goods, 
 that they will pay into the treasury of the United States, for the benefit of the 
 government, the sum of fifteen thousand dollars per annum ; and will pay that 
 sum monthly in advance. Should there be objections, either moral or legal, 
 against the government selling its patronage for money, the undersigned, for the 
 consideration before mentioned, will allow the same sum to go to the benefit of 
 the merchants in the form of an abatement of the usual and legal charges for 
 storage in this city. 
 
 BIXBY & CO. 
 SQUIRES & CO. 
 FRANK SQUIRES. 
 
 Harry A. Smythe, 
 
 Collector of the Port. 
 
 We received from the collector the following reply : 
 
 Collector's Office, Custom-house, 
 
 New York, Atigust 4, 1866. 
 Sirs : Your proposition of the 4th instant, in reference to the storage of gen- 
 eral order goods, was received this morning. Had it reached me before the 
 matter was disposed of it would have been considered. The same result, how- 
 ever, so far as the merchants are interested, will, I trust, be reached under the 
 new arrangement. 
 
 Respectfully, 
 
 HENRY E. SMYTHE, Collector. 
 
28 
 
 NEW YORK CUSTOM-HOUSE. 
 
 This was directed to Bixby & Company. 
 
 How the same result, so far as the merchants arc interested, is attained may 
 be inferred from the following bill, which is a sample of other*, 
 
 Landman & Kemp had twenty cases of quinine in J&tijBaon'estogp. Tin-follow- 
 ing bill will show what are the legal rated for storage and cartage for these 
 
 goods : 
 
 20 cases, storage, at 10 cents a case $2 00 
 
 labor, at 10 cents a case 2 00 
 
 cartage 1 32 
 
 Making a total of $6 32 
 
 By Mr. Rollins: 
 
 Q. That would be the legal rate.' 
 A. Yes, sir. 
 
 By the Chairman : 
 Q. But what was the charge? 
 
 A. 20 cases, storage, at .10 cents each £10 
 
 labor, at 50 cents each . 10 
 
 cartage 10 
 
 Total 30 
 
 These cases weighed eighty pounds each, and the total weight w as sixteen 
 hundred pounds. Twelve hundred pounds is a legal cart-load, and the price for 
 the distance these goods were carried is sixty-six cents per load. This is no 
 isolated case, for bills of this character can be multiplied ad infinitum. The 
 following bill* will serve as a sample of my meaning: 
 
 E. C. J( 
 
 »liuson & Co. charge. 
 
 
 Legai rates. 
 
 Difference. 
 
 
 
 10 cents. 
 
 3 
 
 cents. 
 
 333. \ per cent. 
 
 
 Labor, 
 
 10 cents. 
 
 3 
 
 cents. 
 
 33 3 1 per cent. 
 
 
 Cartage, 
 
 10 cents. 
 
 3 
 
 cents. 
 
 333$ 
 
 per cent. 
 
 Claret, casks 
 
 Storage, 
 
 50 cents. 
 
 20 
 
 cents. 
 
 150 
 
 per cent. 
 
 
 Labor, 
 
 50 cents. 
 
 20 
 
 cents. 
 
 150 
 
 per cent. 
 
 
 Cartage, 
 
 50 cents. 
 
 33 
 
 cents. 
 
 50 
 
 per cent. 
 
 Hardware, casks . 
 
 Storage, 
 
 100 cents. 
 
 50 
 
 cents. 
 
 100 
 
 per cent. 
 
 
 Labor, 
 
 100 cents. 
 
 50 
 
 cents. 
 
 100 
 
 per cent. 
 
 
 Cartage, 
 
 100 cents. 
 
 66 
 
 cents. 
 
 50 
 
 per cent. 
 
 Dry goods, cases . 
 
 
 75 cents. 
 
 30 
 
 cents. 
 
 150 
 
 per cent. 
 
 Labor, 
 
 75 cents. 
 
 30 
 
 cents. 
 
 150 
 
 per cent. 
 
 
 Cartage, 
 
 75 cents. 
 
 44 
 
 cents. 
 
 75 
 
 per cent. 
 
 Bales, Dundees — 
 
 Storage, 
 
 100 cents. 
 
 50 
 
 cents. 
 
 100 
 
 per cent. 
 
 
 Labor, 
 
 100 cents. 
 
 50 
 
 cents. 
 
 100 
 
 per cent. 
 
 
 Cartage, 
 
 100 cents. 
 
 66 
 
 cents. 
 
 50 
 
 per cent. 
 
 
 Labor, 
 
 50 cents. 
 
 10 
 
 cents. 
 
 500 
 
 per cent. 
 
 50 cents. 
 
 10 
 
 cents. 
 
 500 
 
 per cent. 
 
 
 Cartage, 
 
 50 cents. 
 
 .5 
 
 cents. 
 
 1, 000 
 
 per cent. 
 
NEW YORK CUSTOM-HOUSE. 
 
 29 
 
 Myers & Smith charge about the rates which Johnson charged. 
 The following statement will show the effect of the changes in general order 
 
 stores, so far as the cartages are concerned : 
 
 The distance from the present general order store, in Bank street, to 
 the appraisers' stores and to the vast majority of importers' ware- 
 houses 3 miles. 
 
 From the former general order store, 371 Washington street 1 mile. 
 
 Cartages paid by government : 
 
 From Bank street store to appraisers' store, per cart-load 61 76 
 
 From 371 Washington street to appraisers' store, per cart-load 1 10 
 
 Cartages paid by merchants : 
 From steamers of Dale's line, which is the principal line, to Bank 
 
 street store, per load $0 88 
 
 From Bank street store to merchants' warehouses, per load 1 76 
 
 2 64 
 
 From steamers to former general order store 66 
 
 From former general order store to merchants' warehouses 66 
 
 1 32 
 
 The increased cost in the cartage t) the merchants by the change in general 
 order stores is 100 per cent. 
 
 The increased cost in the cartage which the government pays, by the same 
 change, is 60 per cent. 
 
 In October or November last I had several interviews with Thomson about 
 the general order business. He expressed a desire that my firm should have 
 the business. With a view of ascertaining the estimate of its value, after 
 Smythe's experience of the business, I asked Thomson if $20,000 a year would 
 be accepted for the general order business of the whole city. He said he would 
 see, but did not think so small a sum would be accepted ; that was too much of 
 a come down from $40,000. 
 
 By Mr. Rollins: 
 Q. He said that ? 
 
 A. Yes. He said, however, Smythe was very much disappointed in the re- 
 turns of the business, and was disposed to make a change. I asked him if 
 Smythe would prefer a commission. He said no ; Smythe had had enough of that. 
 At a subsequent interview he said there was no use in talking about §20,000 ; 
 but if he got an offer of 825,000 he thought it might work. With the same 
 object in view, I requested him to ask Smythe if he would take $25,000. At 
 a subsequent interview Thomson said 825,000 would not do ; the collector must 
 have S2,000 per month in advance, and that he (Thomson) must have $5,000 
 per year in addition. Having learned the collector's ultimatum, our negotiation 
 ceased. I wish to state that if the general order business was in the market as 
 a matter of sale I would not give $15,000 for it per annum; and no such sum 
 as demanded can be paid without robbing the merchants. 
 
 Q, Why did you offer fifteen thousand dollars then? 
 
 A. I say I would not give it now. I offered it then because I did not wish 
 to lose the business, but having built up a business since I do not care for it 
 now. I wish also to state a rumor, of which subsequent facts will prove the 
 truth : that as soon as the congressional committees had completed their inves- 
 tigations in New York changes would be made in the general order store, and 
 
30 
 
 NEW FORK CUSTOM-HOUSE. 
 
 the reason was that the returns were not satisfactory. Since tin- eonnnittn h t ! 
 
 which was investigating the custom-house | I refer to the Oommittee on Retrench- 
 ment) Smythe has taken away the general orders from the parties who had 
 them, and given them to Myers cV Smith. When I first inqoiied at the ware* 
 
 house department why the collector removed the storage of the general order 
 goods from our warehouse and gave the business to EL G Johnson, i irai 
 informed that department had no information on the subject except what irai 
 contained in the letter from Smythe to the deputy, directing him to send general 
 order goods to such warehouses as B. 0. .Johnson might designate. 
 
 New Fork, January 11, I867i 
 
 FRANCIS M. BIXBY recalled and examined. 
 By the CHAIRMAN : 
 
 Q. Have you in your possession or control a memorandum or note made by 
 Mr. Smythe in reference to the general order business since he has been col- 
 lector? and if so, produce the same. 
 
 A. I have a communication addressed by Mr. Smythe to Humphrey tV Co., 
 and here produce it in evidence. 
 
 The following letter was here put in evidence: 
 
 Custom-house, Nbw York, 
 
 Collector's Office, May 2G, 1SG6. 
 
 Sir : You are hereby notified that I have transferred to Messrs. Van Bergen 
 & Co. the business of storage and delivery of general order goods on the North 
 river, comprised within the district heretofore allotted to you. 
 
 Please make such arrangements with the bearer of this, Mr. George F. Thom- 
 son, as will facilitate an immediate or early transfer of said goods, and oblige, 
 Yours, &c, 
 
 EL A. SMYTHE, Collector. 
 
 Messrs. Humphrey &; Co. 
 
 1 have also a memorandum made under the following circumstances : it was 
 made by the direction and request of Mr. Humphrey, purporting to be a desire 
 of Collector Smythe in regard to the general order business, which desire was 
 made manifest during the negotiation of Thomson with Humphrey & Co. The 
 memorandum put in evidence is as follows : 
 North river : 
 Thomson 3 shares. V. B. & Co., (in pencil.) 
 H. & Co. 1 share. 
 East river : 
 
 H. & Co., who are to take care of the two friends of the President. 
 
 Cartage : 
 $3,000 for political fund. 
 
 On the back of the memorandum slip are the following pencil marks : 
 
 $5,000 Mrs. Perry $3,000 
 
 10, 000 Brown 2, 000 
 
 Political 5, 000 
 
 15, 000 
 
 5,000 10,000 
 
 20,000 
 
NEW YORK CUSTOM-HOUSE. 
 
 31 
 
 This memorandum was Mr. Humphrey's idea of Smythe's desire in regard 
 to the general order business. He took the memorandum to Smythe to see 
 if it was correct, and brought it back with the amendment or addition of V. B. 
 & Co. opposite the word Thomson, by which I was informed the shares were 
 to go to Van Bergen & Co. instead of to Thomson. Mr. Humphrey informed 
 me that he remonstrated with Smythe about this division of interest, and 
 Smythe informed him that he had to use $20,000 to take care of his friends ; 
 aud he made several memorandums on the back of these documents, as Mr. 
 Humphrey informed me, in words and figures as above indicated. The words 
 and figures in pencil mark witness was informed by Mr. Humphrey were made 
 by Mr. Smythe. 
 
 Q. Are you yourself acquainted with Mr. Smythe's handwriting ? 
 
 A. I have seen a great deal of his signatures and writing, at different times 
 purporting to be his. 
 
 Q. In your opinion, from the knowledge thus derived of Mr. Smythe's usual 
 handwriting, do you believe the figures and words on the back of this memo- 
 randum to be Mr. Smythe's ] 
 
 A. I do. Mr. Humphrey also informed me that the figures of 5,000 repeated 
 represented the respective interests of Senators Patterson and Doolittle. 
 
 Q. Have you been able to find the envelope containing a memorandum on 
 the back of it, to which you referred when you first appeared before the com- 
 mittee ? 
 
 A. 1 have not. 
 
 Q. On further reflection, have you any reason to change the relation you then 
 gave the committee of the distribution of the proceeds as there figured ? 
 A. I have no reason to amend that statement. 
 
 Q. While E. C. Johnson & Co. had possession of the general order business, 
 do you know the relation that Mr. Thomson bore to him, and where Thomson's 
 office and place of business were ? 
 
 A. Thomson seemed to interest himself in J ohnson's behalf while in the general 
 order business; and his office during that time was reputed to be at 8 Bridge 
 street, which was Johnson's store and warehouse. During this time I am satis- 
 fied Thomson did not perform his work as a labor of love, because he told me 
 that Johnson was an insufferable jackass ; aud I desire to say. if ever Thomson 
 uttered a true statement during his life, that was one. During the time that 
 Miller & Conger were attempting to bond the stores under their purchase of 
 the general order business from Smythe, Thomson seemed to be very much in- 
 terested in their success. I also understand that Thomson changed his office to 
 Johnsor's store after the latter had received the general order business. 
 
 Q. Do you know the number of bonded warehouses in this city 1 
 
 A. I think there are from fifty to seventy-five. 
 
 Q. How are they located as to doing the general order business ? 
 
 A. I regard any or either of them better located for this business than the one 
 in Bank street, where the business is now located. 
 
 Q. Better for convenience and safety ? 
 
 A. Better in every respect. 
 
 Q. Did you ever have anything to do with the United States public store ? 
 
 A. I was interested in a contract from the government for performing the labor 
 of the appraiser's department and of the store-keeper's department of what are 
 known as the public stores; under which contract we were also to pay the cart- 
 age and incidental expenses of the establishment. This contract went into ope- 
 ration on the 6th of September, 1S59, and terminated on the 6th of September, 
 1S62, and the service was performed for $123,000 per annum. 
 
 Q. How many men did you employ; and how many were necessary; and 
 what was the result in a pecuniary point of view, so far as the government was 
 concerned? 
 
32 
 
 NEW YORK CU8TOM-HOUSE 
 
 A. The amount for which we contracted to do the work wm $100,000 per 
 annum less than the government had hi en paving. We employed in tlii- busi- 
 ness, on an average seventy men, and wo performed the Bervicefl satisfactorily, 
 as I believe, to the merchants and to the government. I don't see how it is 
 possible to employ over one hundred men in that department, without the men 
 getting in each other's way. 
 
 Q. Was this contract a profitable one to the contractors ? 
 
 A. The results were entirely satisfactory to them. 
 
 Nkw Yohk, Tuesday, December 16, 1S6G. 
 
 FRANCIS M. BIXBY recalled and examined. 
 
 By the CHAIRMAN : 
 Q. How long did your firm have the genera] order business in this city? 
 A. Nine years. 
 
 Q. Who were the collectors of the port during that period | 
 
 A. Schell, Barney, and Draper. We had it until Smythe cam" into office. 
 
 Q. During these different administrations of the custom-house, do y«»u believe 
 the general order business was sold hy any of these collectors I 
 
 A. It was not sold hy either Mr. Schell or Mr. Barney ; nor did we ever pay 
 anything in the shape of bonus to either of these gentlemen. 
 
 Q. Could any consideration have been paid to Schell or Harney for this husi- 
 ness without your knowledge [ 
 
 A. It could not, for I had the entire charge of the business finances I also 
 include Mr. King in this statement. We paid some political contributions to 
 Mr. Draper to a small amount. But it was for political purposes — claimed, paid, 
 and received as such. 
 
 NfiW Yoiik, December 17, 1866. 
 BUTLER II. BIXBY* examined by the chairman : 
 Q. State your name and business. 
 
 A. I am a warehouse man, and do business at 56 and 68 (treenwich street. 
 
 Q You have stated you were engaged in the storage business. I put to you 
 a general question whether you have any knowledge of the general order busi- 
 ness connected with that storage business; and if so, state what you know of it. 
 
 A. I have been connected with the general order business lor a number of 
 years at the warehouse 56 and 5S Greenwich street, and have been directly and 
 indirectly interested in the general orders under various collectors, Schell, Bar- 
 ney, and Draper. Soon after Collector Smythe came into office, or early in J one, 
 George F. Thomson, formerly editor of the New York Daily News, stated to me 
 that Collector Smythe had given to him and others the general order business of the 
 North river, and he wished to purchase Humphrey & Co.'s leases and business 
 at 371 Washington street. Soon after our first interview we declined dealing 
 with Thomson, when he presented a letter signed by Mr. Smythe, the collector, 
 stating that he had given the storage of the general orders of the North river to Van 
 Bergen & Co., and George F. Thomson would make arrangements with us as to 
 the general order goods. Thomson stated he was a member of the firm, and that 
 Van Bergen was a relative of Smythe or of Smythe's wife. Then, or soon after 
 that, he said Smythe would give Humphrey & Co. the storage of the general or- 
 ders, if Humphrey «fc Co. would give three-fourths of the profits, of which profits 
 he was to receive five thousand dollars, Van Bergen about ten thousand dollars, 
 Mr. Patterson, son-in-law of the President, five thousand dollars, and Mr. Em- 
 
NEW YORK CUSTOM-HOUSE. 
 
 33 
 
 bree's (the deputy collector) salary was to be increased from this fund two thou- 
 sand dollars, and there were others whose names he would not give. There was 
 one party in Washington. He said the collector was to use some of this money 
 to pay for political assessments or for political purposes ; that previous to this 
 appointment he promised the President to help Mr. Patterson, his son-in-law, 
 who had lost largely during the war. He estimated the profits of both rivers 
 at from thirty to forty thousand dollars. Mr. Thomson said it would help Mr. 
 Smythe and Mr. Embree, and others who would stand to us, and the increase 
 of rates and charges would be run up to one hundred thousand dollars. We 
 declined that arraugement. After this Mr. Thomson said that Mr. Smythe had 
 sold the general order storage of the city to Miller & Conger, for the sum of 
 $40,000 per annum. Again he said that Miller & Conger having failed to se- 
 cure the approval of the Secretary of the Treasury to bond Mr. Getty's store 
 in Greenwich street, that Mr. E. C. Johnson, in Bridge street, had offered Mr. 
 Smythe $50,000 per annum for the business, and would probably make an ar- 
 rangement with Mr. Smythe. The latter part of July, Mr. Johnson sent for Mr. 
 Bixby and Mr. Squires about the general order business, and we called over to 
 see him ; Mr. F. M. Bixby and myself called first. Mr. Johnson then told us 
 that he had offered Mr. Smythe $50,000 for the general order business ; 
 that he did not pay Smythe that, but that Smythe had given him the business, 
 and he wished to sell to us the North river part, alleging that it was worth 
 $50,000, and that the East river was worth $20,000. He gave as a reason why 
 we could afford to pay so large a sum that we might charge the merchants for 
 storage much higher rates than we had been charging, and that if they com- 
 plained we could come and see him, and he could go and see the collector, who 
 would not reduce them. He stated that most of the amounts which he would 
 give for the general order business would go to the collector. We left him, 
 stating that he should hear from us next day, and we wrote him a letter which 
 you already have in my brother's evidence. 
 
 New York, December 17, 1866. 
 
 FRANK SQUIER sworn and examined. 
 
 By the Chairman : 
 Q. Where is your place of business ? 
 A. 296 Water street. 
 
 Q. Were you formerly in the business of general order storage 1 
 
 A. I was for a good many years. 
 
 Q. When did your connection with it cease 1 
 
 A. I think about July, 1866. 
 
 Q. Under what circumstances did it cease 1 
 
 A. It ceased when it was taken away from me, and, I understood, given to 
 Messrs. Miller & Conger, parties on the East river. 
 Q. By whom was it taken from you ? 
 
 A. By the orders of the collector. I understood there was a large amount 
 of money paid for it. I paid no attention to the matter. Mr. Johnson sent 
 for me to call upon him at Nos. 6, 8, and 10 Bridge street, on the firm of 
 E. C. Johnson & Co. 
 
 Q. Do you know who the " company" is ? 
 
 A. Yes ; Mr. Lane, Mr. Kimball, and Mr. Johnson. We called upon him, 
 and he told me he had offered $50,000 for the whole general order business of 
 New York, to the collector, and that he now had it, but had not paid Mr. 
 Smythe for it. He told me he would be willing to make an arrangement with 
 H. Rep. Com. 30 3 
 
34 
 
 NEW YORK CUSTOM-HOUSE. 
 
 me for the East river aide, and asked me did I not think it was worth $20.000 ? 
 I told him chat it did not b6glD to be worth it ; that I did not mean to give any- 
 thing like it. He told me as regarded the charges that I might charge what I 
 
 chose, and he would see me all right if I should have any trouble with the 
 
 merchants; I told him 1 had been connected with the business so long without 
 any complaint from the merchants that 1 should hesitate before J should have 
 anything to do with it. He asked me to call again, but I did not. He met me 
 on the street and asked me why I did not call I told him because I would 
 not enter into such an arrangement ; that my reputation was too good with the 
 merchants to make t.vei charges, as I should be obliged t<» under the proposed 
 arrangement. He told me he had seen other parties, but did not care about 
 them; it J wanted to make a bargain with him for the whole I could do so, 
 -which I declined because it was too much. Ours are the oldest stores in the 
 country, and have been used forty-live ye n - in the warehouse business. 
 
 Did Mr. Johnson tell you how he expected to be aide to give that amount, 
 
 that high juice that you have indicated ; th.it he had a right to charge the mer- 
 chants as lie pleased, and that the collector would see to it 1 
 
 A. That was the way he was to do it. 
 
 Q. Did he tell you what he paid for it? 
 
 A. Not the exac t amount. 
 
 Q. Did he tell you what he was to give the collector.? 
 
 A. lie did not tell me the amount. lie told me he offered $50,000. 
 
 Q. Did he tell you what the collector proposed to do with it? 
 
 A. No, sir. 
 
 Q. Do you know | 
 
 A. I do not. I heard afterwards from a young man who told me he had 
 been down to see the parties and they were to pay to Johnson thirty-five per 
 cent, of all the receipts, thirty of which was to go to the collector. His name 
 is George W. Hart. 
 
 Nkw York, January 12, 1867. 
 FRANK SQUIER recalled and examined. 
 By the Chairman : 
 
 Q. Do you recollect a quinine transaction that attracted some notice here in 
 connection with it \ 
 A. I do. 
 
 Q. State the circumstances to the committee. 
 
 A. I cannot give the date, but I think it was in October, that a case of quinine 
 and one of morphine were sent by us to the public store. The morphine was 
 the only case we had of that drug ; the quinine was one of some dozen cases. 
 They were sent, as I said, to the public store, and were noticed by our employes 
 as being full. The quinine cask was sealed as being full, and they remained at 
 the public store a year, which is very unusual, as they should have been returned 
 within a fortnight to my store. 
 
 Q. Did the merchant suppose they were returned to your store ? 
 
 A. Yes. The merchant came in December, I think, for his cases ; and we 
 told him they were at the public store. He went there, and was told they were 
 not there. He then came back to us, and we showed him the receipts from the 
 public store, and told him to take these receipts back there. He did so ; and then 
 they sent the cases back to us. When they came back, the officer in charge and I 
 saw them ; they were empty. He went at once and got permission to examine 
 them, and to have them opened, and we found the morphine case had nothing in 
 it, and the quinine had about half in it. The owner told me he considered the 
 
NEW YORK CUSTOM-HOUSE. 
 
 35 
 
 value of one of the cases to be $1,400 in gold. I think that was the morphine 
 case. The papers in the custom-house, returned from the appraisers' office, 
 showed that the cases had been weighed at the appraisers' office, and the weights 
 returned to the custom-house for entry ; and those papers corresponded with the 
 weight in the invoices to half an ounce. This the owner told me himself. 
 
 Xew York, December 20, 1866. 
 JOHN 0. MATHER sworn and examined. 
 
 By Mr. Broomall : 
 Q. Y^ou are a partner of Mr. Bixby ? 
 A. Yes, sir. 
 
 Q. Were you present at any interview between Mr. Thomson and Mr. Bixby 
 in relation to the general order business ? It' so, state what took place. 
 
 A. Mr. George F. Thomson, formerly editor of the Daily News, brought a 
 letter there signed by Henry A. Smythe, collector, stating that the general order 
 business had been transferred or disposed of to Van Bergen & Co., and that he, 
 Mr. Thomson, was authorized to make all necessary arrangements. That was 
 the substance of the note. 
 
 Q. State what conversation took place. 
 
 A. I do not know that there was any conversation at that time. He went 
 away, and I have not seen them together since. Mr. Humphrey and Mr. 
 Thomson met at my office a day or two prior to Mr. Humphrey's death ; there 
 was very little conversation. Mr. Thomson told Mr. Humphrey that the col- 
 lector wanted to see him at the office, and he would go with him. They went 
 over together. Mr. Bixby and myself waited in the office, and Mr. Humphrey 
 came back and stated that Mr. Smythe had told him that he had sold out the 
 general order business; and he had some memorandums there, showing who were 
 to be benefited by it. Mr. Humphrey said he was cautioned by Mr. Smythe 
 not to mention it to anybody, but that he felt it his duty to mention it to Mr. 
 Bixby. Mr. Humphrey expressed great indignation and surprise, stating that 
 he was to leave that afternoon for Washington ; that he felt very unwell then, 
 but that as soon as he would reach Washington he would sit down, write to me, 
 and give me his views of the impropriety of this matter, and clear his skirts. 
 
 Q. Do you remember the names and amouuts upon the memorandum ? 
 
 A. I cannot now remember, but I think he offered Mr. Humphrey 83,000 ; 
 and there were several other parties. 
 
 Q. Any senators on the list ? 
 
 A. Don't think there was. Mr. Humphrey mentioned the fact that there was 
 an important man at Washington, whose name he declined to give. There were 
 other parties ; one was said to be a brother-in-law of the collector. 
 
 Q. Did you have any subsequent interview with Mr. Thomson or Mr. 
 Smythe ] 
 
 A. I never saw Mr. Smythe in my life to my knowledge. In fact, the inter- 
 views between Mr. Bixby, Mr. Thomson, and Mr. Humphrey were not so much 
 in my presence, although I was by them occasionally. 
 
 Q. What was the object of these interviews ? What did Mr. Thomson want 
 of Bixby & Co. ? 
 
 A. He wanted Bixby & Co. to overbid somebody else for the business. 
 
 Q. State whether he stated the amount this somebody else was to give ? 
 
 A. I think not. From Mr. Humphrey I learned the aggregate amount was 
 to be $40,000. On hearing this I made the remark that 1 supposed he would 
 be paid for his great Royalty — he having been arrested, as I heard, for disloyalty. 
 
36 
 
 NEW YORK CUSTOM-HOUSE. 
 
 This amount named surprised me, as it did Mr. Humphrey, because we knew that 
 il was impossible for aay business nan to pay that amount without obtaining 
 the collector's sanction to exorbitant charges on the merchants. I did not see 
 how it was possible. I have been in the business about nine years, and it is the 
 first instance I ever heard of any party pa\ing anything for the business to any 
 previous collector. 
 
 (J. From your knowledge of the business would .'J.O per cent, on the storage 
 amount to $4,000 in an ordinary year ? 
 
 A. I should not think it would. Upon that point Mr. Bixby, being a man of 
 details, could tell you better about it. 
 
 Q. Did Mr. Thomson succeed in getting Mr. Bixby to overbid ? 
 
 A. They declined to purchase it upon any terms whatever. They felt that 
 it was a business which had been intrusted to sale and reliable hands and to good 
 warehouses, and that the collector of the port had no business to sell the pa- 
 tronage. 
 
 Q. Did they speak in this way to Thomson in your presence? 
 A. I do not know that they did. Their interviews were generally when I 
 was not present. 
 
 By Mr. Rollins i 
 
 Q. What was the connection that existed between Mr. Thomson and the 
 collector ? 
 
 A. I judged that he was the negotiator for Mr. Smythe to dispose of this 
 business. 
 
 Q. Did you understand that he had full power to sell this business ? 
 A. 1 understood he was the agent of Mr. Smythe, and that whatever arrange- 
 ments he made would be sanctioned by the collector. 
 
 New York, December 20, 1866. 
 HAMILTON BRUCE sworn and examined. 
 
 By the Chairman : 
 Q. How long have you been connected with the custom-house in this city ? 
 A. From 1838 to 1865, with the exception of two years, and filled every posi- 
 tion up to storekeeper. 
 
 Q. Did you compile the warehouse manual ? 
 A. I did. 
 
 Q. Will you please state whether the tables are compiled according to the 
 rules and regulations of the Treasury Department ? 
 
 A. The storage rates are the same as those established by the Chamber of 
 Commerce. They are the customary rates of the port. 
 
 Q. Who had the general order business at the time this book wa3 compiled? 
 
 A. Humphrey & Co., previously. Meantime, Bixby & Co. 
 
 Q. Do you know whether the rates charged by those gentlemen were in con- 
 formity with the book or not? 
 
 A. I have every reason to believe they were. Whenever they did exceed 
 these rates the matter was referred to me, which was very seldom. 
 
 Q. In that respect there was no persistent complaint against them? 
 
 A. 0, no. Mr. Humphrey was an exceedingly conscientious man, and would 
 not consent to receive more than he was justly entitled to. 
 
 Q. With reference to this general order business, is there any contract, or can 
 there be, authorized by law, usage, or regulation with reference to its control or 
 continuation. Will you please tell the committee what you know with reference 
 to that part of the business ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 37 
 
 A. I will go a little back to do so. I never heard of there being a contract. 
 The first United States bonded establishment was at Jersey City, and Cunard 
 & Co. received the privilege. Subsequently one was established in this city, 
 and Mr. Odell received the first privilege. Mr. Odell was subsequently made 
 appraiser of the port, and Messrs. Humphrey & Co. had the general order privi- 
 lege during Mr. Barney's administration. This remained a little while under 
 the name of Mclntyre and Bixby, and was subsequently changed to Humphrey 
 & Co. I never heard of its being disposed of in any way. It was supposed to 
 be a lucrative business, although there were certain seasons of the year when it 
 might not be so. 
 
 Q. Was it optional with the collector to send the general order goods where 
 he thought proper, provided the structure could be bonded ? 
 
 A. It was generally supposed that he would designate those stores most 
 suitable and accessible to the ships, so as to make the cartage reasonable. 
 
 Q. How was that with Messrs. Humphrey & Co ? 
 
 A. I have reason to believe that theirs were the nearest stores where proper 
 accommodation could be had. 
 
 Q. How is it now under Messrs. Myers & Smith ] 
 A. I do not know where their stores are located. 
 
 Q. Is there anything in usage or rule forbidding the collector to take away 
 or give this business? 
 
 A. He generally designates the stores, and the deputy in charge of the third 
 division directs the general order to be given to such stores; although, when 
 Mr. Humphrey had the business, and I, being then deputy in charge of the third 
 division, thought it was necessary for the interests of the merchant or the gov- 
 ernment, I sent them to some other store, and Mr. Humphrey never took ex- 
 ception to it. 
 
 Q. Who has the right of that designation now at the custom-house ? 
 
 A. The privilege is the collector's, but the orders are generally given through 
 the stoorkeepers of the port, who is supposed to comply with the wishes of the 
 collector in these matters. The deputy in charge of the third division is ex 
 officio storekeeper of the port. The present deputy is Mr. Stedwell. When I 
 was deputy I found Mr. Bixby, also, always willing to do what was right in the 
 matter of storage. 
 
 New York, Tuesday, December 18, 1866. 
 JEREMIAH H. STEDWELL sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you connected with the custom-house ? 
 A. Yes, sir. 
 
 Q. How long have you been? 
 A. Since April, 1861. 
 
 Q. Do you have charge of the various bonded warehouses ? 
 A. I have charge of the warehouse division. 
 
 Q. Where are the general order goods of the upper district of the N-orth river 
 now stored? 
 
 A. In the store at Bank street. 
 
 Q. How far is that from the appraisers' store? 
 
 A. I cannot say distinctly; perhaps two miles and a half; possibly three. 
 Q. Where were they stored under Collectors Barney and Draper ? 
 A. At 371 Washington street. 
 
 Q Does the government pay the cartage on all goods sent for examination 
 to the appraisers' store ? 
 
38 
 
 NEW YORK CUSTOM-HOTS!-: 
 
 A. Yes, sir. 
 
 Q. Whal IB tin; charge of cartage at present from Hank street to I lie aporai.-er-' 
 stores ? 
 A. I cannot tell you. 
 
 ( A >. What was it from 371 Washington street? 
 
 A. It i6 not in my department t<> pay tlii- "artage. I think it was ahoiit. one 
 dollar .-ind ten cents; either eighty-eight cents, or >' 1 10. 
 Q. You don't know w hat it is to the present store { 
 A. I don't know the exact distance; it is a question of measurement. 
 Q. Were not the stores at '57 1 Washington street suitable for the business? 
 A. They were considered so. 
 Q. That is general mercantile opinion? 
 A. Yes, sir. 
 
 Q. Was the manner in which the business was conducted there by the per- 
 sons in charge acceptable? 
 
 A. I helieve so, sir; there was always a readiness on their part to conform to 
 any regulations made. 
 
 Q. Do you know the h-.-sees of that store? 
 
 A. Yes, sir, Humphrey cV Co.; Humphrey was lately a meinher of Congress. 
 
 Q. Do you know anything about complaints being made for overcharges, 
 and was there any foundation for them? 
 
 A. A great may complaints were made for overcharging at 363 West street, 
 and 8 and 10 Bridge street, when E. C. Johnson & Co. had the business. 
 
 Q. To whom were the complaints made? 
 
 A. To me generally. Sometimes to the collector, and then referred to me. 
 
 Q. When made to you, what disposition did you make of them? 
 
 A. I always adjusted the bills according to what seemed to be the proper 
 rates to charge lor the goods; taking the regulations of previous collectors for 
 that purpose. 1 wrote on the back of the bill what ought to be the charge, and 
 put my initials to it. It was alw ays customary, on the part of those having the 
 general order business before, to take heed of this, and charge accordingly. 
 
 Q. How was it in this case? 
 
 A. They would at first do it in pome cases, but after a while, when they saw 
 these corrections become numerous, they took no notice of them ; and finally 
 treated them with contempt. 
 
 Q. Did you know the conditions on which they had the business? 
 
 A. No, sir. 
 
 Q. Do you know why it was taken away from them? 
 
 A. The collector said to me, because they overcharged. 
 
 Q. Did he ever state to you what they paid or were willing to pay ? 
 
 A. No, sir. 
 
 Q. Since these late changes took place, have there been any complaints in 
 reference to overcharges? 
 
 A. There have been against 6, 8, and 10 Bridge street, which are Johnson's 
 stores ; but now continue under the superintendence of Myers & Smith ; against 
 that store there continue to be complaints made. 
 
 Q. Are these complaints brought to the knowledge of the collector? 
 
 A. I do not know since the change whether they have been or not. 
 
 Q. They were brought to your knowledge. Now, where you have suggested 
 corrections to be made, how have they been treated ? 
 
 A. I have had no bill returned, so I believe the corrections have been noticed. 
 
 Q. Have you any other opinions you can give us ? 
 
 A. T do not know that I have. 
 
 By Mr. Rollins : 
 Q. The tariff of these charges is regulated by law. 
 
 A. No, sir. In 1857 the Chamber of Commerce of this city made a schedule 
 
NEW YORK CUSTOM-HOUSE. 
 
 39 
 
 for the rate of storage of general order goods. This continued to be the basis 
 on which the charges were made down to 1862. Then labor rose and every- 
 thing else rose, and the general order men began to charge higher than they did 
 before. The merchants complained, and finally, at my instance, a conference 
 was held before Collector Barney. Gold was then $2 50, or 82 60, and Mr. Bar- 
 ney decided that the rates of 1857 should be still the basis and the general 
 order men be allowed to add the gold premium. That was getting them down 
 a good deal, for they were charging four or five times the rare. These charges 
 then prevailed until Collector Draper came in, and he cut the rates down to 
 sixty per cent, in addition to the rates of '57. In my judgment that was about 
 a fair addition ; for their expenses were then at least fifty per cent, greater 
 than they were in 1857. And it was upon that basis I adjusted all bills brought 
 to me. 
 
 (Witness was here shown Bruce's Warehouse Manual, and his attention called 
 to the article therein headed " Rates of storage and labor chargeable on unclaimed 
 goods.") 
 
 Q. Are these the rates of storage to which you allude as being adopted by 
 the Chamber of Commerce in 1S57 and on which the present charges are an ad- 
 vance ofsixty per cent. ? 
 
 A. Yes, sir ; changes have taken place in the articles imported and in the 
 character of the packages imported, but in such cases we are guided by these 
 and make the rates as nearly similar as possible. 
 
 New York, January 9, 1867. 
 JEREMIAH H. STEDWELL recalled and examined. 
 
 By the.. Chairman : 
 
 Q. Do you know what the law requires of the collector in reference to the 
 designation of warehouses for the reception of general order goods ? 
 
 A. It is not a matter of law, because the law provides that any warehouse 
 duly constituted for the storage of dutiable goods may receive unclaimed goods ; 
 neither is it a matter of general regulation. Subsequent to the regulation of 
 1857, where warehouses were specially designated for that purpose, the then 
 warehouse superintendent made a report stating that the safety of the goods of 
 the merchants, and the proper facility for the discharge of the public business, 
 required certain warehouses should be designated by the collector to receive 
 these unclaimed goods. From that time it has been the custom of the collector 
 to designate warehouses properly located and provided for the reception of 
 such goods. 
 
 Q. Under Mr. Smythe's administration has he designated these warehouses ? 
 A. He has given directions which have led to the designation of the particular 
 warehouses. 
 Q. Were these directions given to you? 
 A. Yes. 
 
 Q. Has he, in fact, directed you to send them to such places as E. C. Johnson 
 may designate] 
 
 A. He did do so, in the first instance. 
 
 Q. Is that regulation or direction still in force? 
 
 A. No; not the original in regard to E. C. Johnson. As I said before, in the 
 first instance the collector said I was to send the goods in accordance with the 
 directions Mr. Johnson should give me on that subject. I think he directed me 
 in writing, but I am not positive. But his verbal directions to me were to send 
 the goods to such stores as Johnson should designate, as he had general charge 
 
40 
 
 NEW YORK CUSTOM-HOUSE. 
 
 of the warehouse business. That direction remained in f ree until he gave thai 
 same direction in regard to Myers & Smith* 
 
 Q. Is it now in force? 
 
 A. Yes. 
 
 Q. Is E. C. Johnson now connected with the custom-house? 
 
 A. Not more than he always has been, as proprietor of a bonded warehou-' . 
 
 Q. Does he still receive the general order goods? 
 
 A. He does in his stores on Hridge street; but I understand he has no con- 
 trol over any other warehouses than his own. 
 
 Q. Does he receive what he now receives under Myers &c Smith? 
 A. Yes. 
 
 Q. Do you know the terms on which he receives them? 
 
 A. No. 
 
 Q. Do you know whether he is to pay, or whether he has agreed to pay any 
 money or percentage for the easiness I 
 A. I have no knowledge on the subject. 
 Q. What is your belief* 
 
 A. I think it was Mr. Myers that told me Mr. Johnson received these goods 
 under them, and that lie paid them a certain commission; but he did not men- 
 tion what the commission was, as I recollect. 
 
 Q. Did you ever hear Mr. .Johnson say anything about it? 
 
 A. Nothing, further than at one time I heard him say he had nothing to do 
 with general orders any more. 
 
 JEREMIAH II. STE DWELL sworn and examined. 
 
 By the CHAIRMAN : 
 Q. Are you connected with the storekeeper's department of the New York 
 custom-house? 
 A. I am. 
 
 Q. Are applicants for appointment in that department subject to examination ? 
 A. They are sent to me for an examination, though usually after their ap- 
 pointment. 
 
 Q. After »m examination by you you report on them, sometimes accepting 
 and sometimes rejecting their nomination ? 
 A. Yes, sir. 
 
 Q. Are your reports usually accepted and conclusive ? 
 
 A. I have no recollection of any case of an applicant being appointed whom 
 I have rejected. I may say, by way of explanation, that there have been one 
 or two men whose age and infirmities have rendered them doubtful ; but finding 
 that they had already been appointed upon representation of the matter to the 
 collector or the secretary, they were passed. 
 
 Q. Do you recollect examining a Chilian ? 
 
 A. Y>s, sir. 
 
 Q. What was your report in his case ? 
 
 A. I reported that lie seemed to be qualified. The position of storekeeper 
 is a very hard one upon which to examine the qualifications of a man. If a 
 man can read and write, and has the capacity of attention to duty and of ob- 
 servation, he can perform his duties intellectually. That kind of examination 
 would not take more than five minutes, and in that time the moral qualifications 
 of a man could not be discovered. 
 
 Q. In this case you knew or ascertained what the man's reputation was ? 
 
 A. Y>s, sir. 
 
 Q. What was it ? 
 
 A. I have always understood he was one of the most disreputable and dan- 
 
NEW YORK CUSTOM-HOUSE. 
 
 41 
 
 gerous men in the city. If common report is correct, he has been tried for 
 murder, and engaged in several murderous affrays. 
 
 Q. He was rejected? 
 
 A. Yes, sir. 
 
 Q. What has been the character generally of the nominations of late ? 
 
 A. From the warehouse superintendents I learn the officers are nut doing 
 their duty as well of late as they used to. There are quite a number of men 
 there who, from age or other reasons, are not able to perform their duties at all 
 efficiently. 
 
 Q. Is the number fixed by law ? 
 
 A. No, sir. 
 
 Q. Has it been increased lately ? 
 
 A. Yes, sir, a lar^e number of additional warehouses have been bonded. 
 Q. Is there a larger number of storekeepers than necessary ? 
 A. If they were all efficient and attentive men there are more than would be 
 necessary. 
 
 Q. Is it in your bureau that applications are made«or papers filed and passed 
 upon with reference to the general order business 1 
 A. No, sir. 
 
 Q. Suppose a warehouseman offers his store, where is that offer received and 
 entertained ? 
 
 A. Such applications are seldom or never made. It would go before the col- 
 lector naturally, as he has the power of giving the franchise. It might come to 
 me to report upon as to the character of the store. On one occasion a paper 
 strayed into my office, which I returned. 
 
 Q. Suppose such an one comes to your office, how do you ascertain the char- 
 acter of the warehouse ? 
 
 A. I know the warehouses generally — their capacity and character. There 
 has no such duty been before me under the present collector. 
 
 Q. Does the collector attend to those matters himself, or leave it to some sec- 
 retary 1 
 
 A. I have no information on that subject at all. 
 
 Q. Do you know whether, under the present collector, or any previous col- 
 lector since you have been connected with the office, there has been any consid- 
 eration offered, any presents, checks, money, merchandise, or valuables of any 
 kind offered, to obtain the acceptances of these warehouses ? 
 
 A. I have no personal knowledge on the subject ; no such offer has been made 
 through me, nor to my knowledge. 
 
 Q. Yo.x don't know who does that business now at the custom-house; who 
 entertains these applications, passes upon them, and accepts them ? 
 
 A. I think you overestimate the amount of these things. 
 
 Q. Well, sometimes there are over a hundred of them on hand ? 
 
 A. I judge not, because there are only seventy warehouses. First, we have 
 class 1, warehouses owned by the government. They were abolished by the 
 act of 1854. Then there is class 2, warehouses owned by the merchants for the 
 storage of their own goods. Also, there is class 3, warehouses bonded for the 
 general storage of dutiable merchandise. The collector may appoint a greater 
 number at his own will, without any legal action whatever. He simply directs 
 me to have certain goods go to certain warehouses. If any applications of that 
 sort are made they are made personally to our office. During Mr. Barney's ad- 
 ministration no change was made in the warehouses. 
 
 Q. Where overcharges are made by those warehousemen does the complaint 
 come to your desk ? 
 
 A. Yes, sir, ordinarily. 
 
 Q. How is it now j are there many complaints of the description ? 
 
42 NEW YORK (M STOM-HOL'SE. 
 
 A. There are some complaints every day, mainly directed against X--. 6, v . 
 and 10 Bridge street, I had one or two yesterday. 
 
 Q. How was it with Messrs. Humphrey \ Iiixby ? 
 A. There wen; very few, if any. 
 
 By Mr. Broom all ; 
 Q. How under E. 0. Johnson & Co.? 
 
 A. Very much worse. During the time lie had charge the hills were very ex- 
 cessive. 
 
 Nkw YoKK, January 'J, lNi7. 
 
 PETER A. VAN BERGEN sworn and examined. 
 
 By the Chairman : 
 Q. What is your husiness ? 
 
 A. I am at present iinthe custom-house ; I am chief clerk in the drawback 
 department. 
 
 Q. Have you heretofore been engaged in the bonded warehouse' husiness in 
 this city ? 
 A. No. 
 
 Q. Have you ever negotiated with reference to taking an interest in it? 
 A. Yes, I have been spoken to in regard to it ; I think it was in the early 
 part of .June, last year. 
 
 Q. 'Who w< re you to be interested with ? 
 
 A. I cannot tell precisely, because the matter was never consummated* I 
 understood George P. Thomson was to be one of the persons. 
 Q. Do you know the other parties ? 
 A. No, sir. 
 
 Q. Who approached you on the subject? 
 
 A. I think it was the collector. My name was to be used in carrying on the 
 business. 
 
 Q. In other words, you were to be a silent partner in the concern ? 
 A. No ; I was to take an active part in it. The negotiations were made by 
 Thomson, principally. 
 
 Q Which did, Thomson or Smythe, open the matter to you first? 
 A. Mr. Smythe did. 
 
 Q. Can you state to the committee precisely what Mr. Smythe said to you, 
 or how he opened the matter to you, and what the particulars were ? 
 
 A. I cannot state precisely what took place at the time. I think he said that 
 there was such a business, and that it was usually carried on b}' Bixby & Co., 
 and that we were to carry on the business the same way it had always been 
 carried on. 
 
 Q. Do you not recollect who the other persons were ? 
 
 A. I recollect the name of Doolittle was mentioned in connection with it. 
 
 Q. What Doolittle was that ? 
 
 A. I cannot tell. 
 
 Q. Do you think it was the senator, or a son of his ? 
 A. I suppose it was a son of Senator Doolittle's. 
 
 Q. Do you recollect any other name or names having been mentioned ? 
 A. No ; I do not distinctly remember any names being mentioned to carry 
 on the business. • 
 
 Q. Was the name of the company agreed upon ? 
 
 A. I understood so. I believe it was pretty generally understood it was to 
 be Van Bergen & Co. It did not go on so far as that that matter should be 
 gone into ; but my name was to be used. 
 
NEW YORK CUSTOM-HOUSE. 
 
 43 
 
 Q. Was Mr. Patterson's name mentioned ] 
 A. I do not recollect. 
 
 Q. Did Mr. Sniythe or Mr. Thomson in conversation with yon mention that 
 name ? 
 
 A. They might have done so, but I don't now recollect. 
 
 Q. Do you recollect whether anything was said about any persons being in- 
 terested in it at Washington ? 
 A. No. 
 
 Q. Was not Patterson's name mentioned in connection with Doolittle's? 
 
 A. I do not recollect. I understood, generally, there were to be several other 
 persons interested besides Doolittle and Thomson ; but who they were I cannot 
 say. ^ ' 
 
 Q. Did not Mr. Smythe himself retain an interest in the business for specific 
 purposes 1 
 
 A. That I cannot say anything about. 
 
 Q. Was the amount the business would amount to ever figured up ? 
 A. I made some inquiries about it. I supposed it would be worth to me from 
 S2,000 to $2,500. 
 
 Q. I mean the amount of the whole business ? 
 
 A. I heard it variously estimated ; but twenty thousand dollars was the sum 
 I heard more generally mentioned. 
 
 Q. Now, don't you remember how this was to have been distributed ? 
 A. I do not. 
 
 Q. Do you know whether the arrangement was to have been by shares, or 
 by the net or gross proceeds 1 Was there anything said about shares ? 
 
 A. I heard nothing said about net or gross proceeds ; it did not go as far as 
 that. I don't know how the business was to have been carried on, as it was not 
 consummated. 
 
 Q. Now, was there not an arrangement made by which Thomson, as outside 
 manager, was to retain a certain proportion, say three shares, and Humphrey 
 one share ? 
 
 A. I don't know any arrangement that was made with any other person. 
 
 Q. Did it go as far as to talk about the geopraphical distribution ] For instance, 
 the East river portion was to take care of two persons who were said to be friends 
 of the President ? 
 
 A. I do uot. The truth is, I do not see the collector or Thomson very often. 
 Q. Did Thomson talk to you about it ? 
 A. Yes. 
 
 Q. Die the collector talk to you about it 1 
 A. Yes. 
 
 Q. In these conversations were not the details of this thing gone into ? 
 A. No. 
 
 Q. If they were not, then what was the point of the conversation ? 
 
 A. The point of it was to carry the thing out. The great difficulty was to 
 get the stores, as Bixby & Co., who had it, wanted to hold on to it, and they 
 threw every obstacle in the way. There was more talk about this than any- 
 thing else. 
 
 Q. Was there anything said about the cartage % 
 
 A. I don't think that was mentioned at all in my presence. 
 
 Q. Why did this arrangement fail, and was not carried out ? 
 
 A. That is more than I can tell ; but no arrangement could be made with 
 Bixby and Co. to get their stores ; and no stores could be got in which to carry 
 on the business, and the arrangement seemed to fail more by reason of that than 
 for any other cause. 
 
 Q. Did Smythe or Thomson ever give you any other reason for the failure 
 
44 NEW YORK CUSTOM-HOUSE. 
 
 of this arrangement than their not being able to get stores ? Did they ever give 
 you any other reasons ? 
 
 A. I ean hardly recollect that there were any other reasons. I have never 
 gone, doling the whole business, to see Bixby & Co., or whoever represented 
 them. I never went to their stores, or had any negotiation with them, and, 
 therefore, I cannot say what other reasons there wen; for its failure. 
 
 Q. How long was this negotiation pending? 
 
 A. A number of weeks. 
 
 Q. Who told you first it fell through 1 
 
 A. I cannot recollect. 
 
 Q. You should recollect so important a thing as that, at least by whom the 
 information was given to you. 
 
 A. It might have been by Mr. Smythe. 
 
 Q. You say you don't know why it finally fell through ? 
 
 A. I know no arrangement could be made with Hixby & Co., and it was 
 finally taken away from them and given to somebody else. 
 Q. Given to Miller & Conger? 
 A. Yes. 
 
 Q. Do you know on what terms they received it ? 
 A. I cannot say I do. 
 
 Q. Do you know they were to pay 840.000 for it ? 
 A. Something was said about $40,000. 
 
 Q. Did you not know from Smythe or Thomson that they proposed to pay 
 $40,000? 
 
 A. Some arrangement of that kind was talked of, but they never carried it 
 out; and afterwards I understood it was given to somebody else without any 
 arrangement whatever. 
 
 Q. Who told you Miller & Conger were to have the general order business ? 
 
 A. I cannot tell you now whether it was the collector or somebody else told 
 me so ; I think it is very likely it was the collector told me so". 
 
 Q. Are you a relative of the collector ? 
 
 A. I am not, sir. My wife is a cousin of his wife, but I am no relative. 
 Q. Did you not expect to receive a certain amount from this Miller & Con- 
 ger arrangement ? 
 A. No. 
 
 Q. Were you not told that you should or would receive a certain amount of 
 the price they were to pay ? 
 A. No. 
 
 Q. Were you not told you would receive something out of the transaction ? 
 
 A. I did not know but I would receive something, but there was no distinct 
 understanding about that. 
 
 Q Why then did you think you would receive something, if there was no un- 
 derstanding about it ? 
 
 A. I expected to receive something in this way : I expected to receive an ap- 
 pointment in the custom-house. 
 
 Q. You were not in the custom-house then ? 
 
 A. No. 
 
 Q. Were you not encouraged to expect a share of the $40,000 ? 
 
 A. No, sir ; I only expected to receive an appointment in the custom-house. 
 
 Q. Was that in lieu of any pecuniary advantage ? 
 
 A. Yes ; as soon as this fell through I expected to receive some appointment 
 in the custom-house. 
 
 Q. Were you not led to expect that from the Miller & Conger arrangement 
 you would be benefited to the amount of some $10,000 ? 
 
 A. No. 
 
 Q. Or any amount ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 45 
 
 A. No. 
 
 Q. You stated that you expected to receive something. What was that 1 
 A. An office in the custom-house. 
 
 Q. Did you not expect to receive something from this Miller & Conger arrange- 
 ment in money, percentage, or otherwise 1 
 
 A. No, except in the way of an appointment. 
 
 Q. When the Miller & Conger arrangement fell through, were you to be in- 
 terested in the arrangement with E. C. Johnson? 
 A. No. 
 
 Q. Then I understand you to say that in lieu of these pecuniary advantages 
 you expected to receive, and did receive, and are now enjoying, an office in the 
 custom-house ? 
 
 A. I cannot say in lieu of, because I expected originally to receive some ap- 
 pointment in some way. 
 
 Q. Why did you expect originally to receive an appointment in the custom- 
 house ? 
 
 A. I had an assurance from Mr. Smythe, as a particular friend of mine, that 
 I would get one ; and as I have always been a loyal man, I expected some ap- 
 pointment. 
 
 Q. Do you see him frequently now ] 
 
 A. Not frequently. 
 
 Q. Do you, at his house or office, have familiar talks, such as your long in- 
 timacy would warrant ? 
 
 A. No ; I don't suppose that within the last two months I have talked with 
 him half an hour altogether. 
 
 Q. Did you ever have any conversation with him in reference to the present 
 situation of the general order business ? 
 
 A. I have not spoken to him on that subject for two months. 
 
 Q. Do you know Senator Patterson ? 
 
 A. No. 
 
 Q. Do you know Doolittle, the weigher ? 
 A. No ; I don't think I ever saw him. 
 Q. Do you know Senator Doolittle ? 
 A. I do not. 
 
 Q. Had you any conversation with Mr. Smythe in reference to the arrange- 
 ment with E. C. Johnson & Co.? 
 
 A. Mr. Smythe told me he had given them the business. 
 Q. Did he tell you the conditions ? 
 
 A. He told me he had given it to them without any conditions whatever. 
 
 Q. What was your business before you got the present position \ 
 
 A. I was a lawyer. 
 
 Q. Do you practice now % 
 
 A. I was in New Orleans last winter and the winter previous, and I did a 
 little business there. 
 
 Q. When did you receive this appointment in the custom-house ? 
 
 A. I think in October last. 
 
 Q. What are your duties there 1 
 
 A. I am chief clerk in the drawback department. 
 
 Q. What is your salary ? 
 
 A. $2,000 a year. 
 
 Q. Do you discharge the duties of your office daily ? 
 
 A. I am there daily, and have been absent, I believe, but three days since I 
 went there, and then it was by special permission. 
 
 Q. Have you any knowledge of the present arrangement of the general order 
 business with Myers & Smith ] 
 
 A. No. 
 
46 
 
 XKW YORK C( T STOM-IIOI <K 
 
 Q. Have you heard anyone say what won- the terms and condition.- ? 
 A. No. 
 
 Q Have you ever received anything from the general order business since 
 Mr. Smythe has been collector, either directly or indirectly! 
 A. No. 
 
 Q. Do you expect to receive anything from the present holders of the busi- 
 ness — Myers tV Smith — or from others I 
 
 A 1 expect to receive my salary as chief clerk, while I am in that position, 
 but nothing else. 
 
 Nk\V York. .Innuary 'K 1 *t)7. 
 GEORGE F. THOMSON sworn and examined. 
 
 By the Chairman : 
 Q. AYh.it is your business ? 
 
 A. I am employed at present by Myers c\: Smith. 
 
 Q. How long have you been in their employ and in what capacity are you 
 
 employed I 
 
 A. I have been in their employment about a month or a little more. My 
 duties are general ; I solicit orders from merchants, and aid them in their cus- 
 tom-house business, and do outside business. 
 
 (J. Thev are the present receivers of the general order goods ? 
 
 A. Yes. 
 
 Q. How long have they had this business? 
 
 A. Something more than a month. They commenced receiving the goods 
 about the first of December. 
 
 Q. Who had the business previously ) 
 
 A. I think the firm of E C. .Johnson & Co. had it. 
 
 Q. Have yon ever been in the bonded warehouse business yourself? 
 
 A. Yes; 1 was one of the earliest in that business. 1 took the stores under 
 the new system. 
 
 Q. Are you interested in any of these bonded warehouses now ? 
 A. No, sir 
 
 Q. Do you know Mr. Smythe, collector of the port of New York ; and if so, 
 how long have you known him ? 
 
 A. I know Mr. Smythe since we were boys, and were brought up together. 
 
 Q. You knew, of course, when he was appointed collector and the subse- 
 quent arrangements made with different persons in reference to the general or- 
 der business ; now, when the business was taken from Humphrey & Co., or 
 Bixby & Co., who were the first appointed their successors ? 
 
 A. Miller & Conger received the first appointment to the business. 
 
 Q. How long did they hold it ? 
 
 A. They did no business under it ; they gave it up before they did any busi- 
 ness. 
 
 Q. At the time Miller & Conger were negotiating for it who were the recipi- 
 ents of it ? 
 
 A. Bixby & Co. 
 
 Q. To whom did it go from Bixby & Co. ? 
 
 A. It was not taken from them up to that point. 
 
 Q. To whom did it finally go from Bixby & Co. ? 
 
 A. To E. C. Johnson & Co., I believe 
 
 Q. How long did E. C. Johnson & Co. hold it ? 
 
 A. I believe about between two and three months. 
 
 Q. And then to whom did it go ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 47 
 
 A. So far as my knowledge goes, to the present firm — Myers & Smith. 
 
 Q. Do you know the circumstances under which Myers & Smith received it ? 
 
 A. No. 
 
 Q. Are you at present proprietor of any bonded warehouse 1 
 A. I am not. 
 
 Q. Are you an agent or employe of any one except, as you have stated, to 
 Myers & Smith, at present owning an interest in a bonded warehouse 1 
 A. I am not. 
 
 Q. You have no interest of that kind now ? 
 A. None at all. 
 
 Q. I understand you to say you have no knowledge of the arrangements 
 that took place pertaining to giving that business to Myers & Smith ; or, in 
 other words, that you had nothing to do yourself in bringing about the arrange- 
 ments by which Myers & Smith received that business 1 
 
 A. No, sir ; none at all. 
 
 Q. Did you ever have any conversation with Mr. Smythe on the subject *? 
 A. No . It was transferred before I knew anything about it. 
 Q. Transferred to Myers and Smith ? 
 A. Yes. 
 
 Q. Were you in their employ at the time ? • 
 A. Not at the time. 
 
 Q. Did your employment by them take place since the transfer of this busi- 
 ness to them ? 
 
 A. Almost immediately after. 
 
 Q. Had you been in their employment before 1 
 
 A. No. 
 
 Q. How did you come to be interested with them or in their employment ; 
 what led to it ? 
 
 A. I knew the firm very well. I met Mr. Myers, I think, in Wall street, and 
 he told me that he had made arrangements for this general order business, and 
 that he wanted some one to aid him in various ways, and he wanted to know if 
 I was prepared to give him assistance. I told him I was. 
 
 Q. What inducements did he hold out to you to assist him in this business ? 
 
 A. I asked him what inducements he could offer me, and he then wished to 
 know what I thought my services would be worth. I said I thought from five 
 to ten thousand dollars, that I was not particular, but I thought he should give 
 me five thousand dollars. He said he could not afford that, as he was obliged 
 to reduce the charges on the general order goods. It was with Mr. Myers I 
 had this -ionversation. He said, however, that I might depend on two or three 
 thousand dollars ; and after he got to work right, and had got his Water street 
 stores into operation, he might increase it. Under these circumstances I agreed 
 with him. 
 
 Q. Has there been any change or variation of that agreement 1 
 A. Not with me. 
 
 Q. Who were the owners or lessees of the warehouses 6, 8, and 10, Bridge 
 street ? 
 
 A. Mr. Johnson. 
 
 Q. Who were the lessees of 363 West street 1 
 
 A. I could not say. 
 
 Q. Of 271 South street? 
 
 A. I do not know. 
 
 Q. Have you ever received any money, check, or obligation from any persons 
 interested in these warehouses ? 
 A. No. 
 
 Q. You received none from E. C. Johnson ? 
 A. No. 
 
48 NEW YORK CUSTOM-HOUSE. 
 
 Q. Growing out of this matter or otherwise ? 
 A. Np, sir, unfortunately I have not. 
 
 Q. Have you ever received Anything from any person on their account or 
 that you have reason to believe came from them directly or indirectly? 
 A. I have not. 
 
 Q. By this arrangement between yourself and Myers »ic Smith, have you 
 ever received any consideration, cheek or money for your services ; and if so, 
 how mucb I 
 
 A. I have received nothing yet, sir. 
 
 Q. Have you received anything from them for any other persons ? 
 A. No. 
 
 Q. Have you received anything from them to pay or give to any other per- 
 son or persons ? 
 A. I have not. 
 
 Q. You did not then do the outside business of the firm — the financiering? 
 A. I did no financiering business 
 
 Q. Do you know whether Mr. Sniythe, <>r his agent, or his. secretary, or his 
 employe, or any other representative for him, has received any money from the 
 proprietors of these warehouses, or any one of them ? 
 
 A. I do not. 
 
 Q. Have you, yourself, directly or indirectly, received any money, check, or 
 other obligation from Mr. Smythe on account of this general order business? 
 A. 1 have not received a cent, sir. 
 
 Q. Have you any interest in the storage of general order goods ? 
 A. Not a particle. 
 
 Q. Have you any arrangement or understanding with Myers & Smith that 
 you shall receive anything? 
 
 A. No, sir; except as I stated. 
 
 Q. Are you, or is Mr. Smythe, to receive any sum of money, or other consid- 
 eration, for or from the storage of general order goods, from Myers & Smith, to 
 your knowledge or belief? 
 
 A. I don't know anything about it. 
 
 Q. Are you, or is Mr. Smythe, to receive any percentage on the amount 
 charged or received for the storage of general order goods ? 
 A. Not to my knowledge. 
 
 Q. Has there ever been any conversation touching that between yourself 
 and Mr. Myers ? 
 A. No. 
 
 Q. Has there ever been any conversation between yourself and Mr. Smythe 
 on that point I 
 
 A. There might have been in the early part of this matter. 
 Q. When was that, and with whom was it ? 
 A. It might have occurred with Bixby & Co. 
 Q. Do you know what it was substantially? 
 
 A. I was endeavoring to make some arrangement w r ith Messrs. Bixby in 
 reference to this general order business, and if this conversation came up at all 
 it came up in that way. 
 
 Q. What was that conversation exactly? State it as near as you can. 
 
 A. It is pretty difficult to tell. It came up in various forms in the many 
 propositions made on one side or another. We were engaged in reference to 
 this matter for two or three weeks. 
 
 Q. Whom do you mean by "we." 
 
 A. Messrs. Bixby and myself. Mr. Humphrey was not present, and we could 
 not very well come to a decision. My conversations with the Bixbys I told to 
 Mr. Smythe. 
 
 Q. Were you acting for Smythe then ? 
 
NEW YOKK CUSTOM-HOUSE 
 
 49 
 
 A. I was the agent and friend of Smythe, and hoped to have an interest in 
 the business myself, and of course took an interest in it. The particular arrange- 
 ments proposed I could not state this moment; but there was nothing came out 
 of it. At any rate it was finally dropped, and the whole matter passed out of 
 my hands, and was given to Miller & Conger. 
 
 Q. Do you recollect the amount that was to be paid, or the consideration that 
 was to be given, by Messrs. Bixby, provided the business was continued with 
 them 1 
 
 A. I thought to buy them out. One of the propositions made was to buy 
 out the whole concern. Another was to divide the business ; they to give me a 
 portion of it. The question took various shapes. I think I proposed to buy 
 their business, take the lease off their hands, pay them for the amount of stor- 
 age on hand, and take control of their whole place or places. Another proposi- 
 tion was, they were to carry on the business and permit me in some shape to 
 divide with them. Several propositions of this kind were made. I don't re- 
 collect that they made any distinct offer to me for money, or that I proposed 
 any to them. Finally we arrived at an arrangement which I think was that I 
 should receive a portion of the business. I took the matter then to the collector 
 in order to let him know what I had done. He seemed to be somewhat dissat- 
 isfied with the delay or with something or other, and he said that he would have 
 no more to do with it, and that he thought he should make other arrangements. 
 I was somewhat disappointed myself, and left him. Since then I have had very 
 little to do with the matter. 
 
 Q. In these negotiations with Messrs. Bixby & Co. on behalf of the collector, 
 what was the sum or about the specific sum that Mr. Smythe thought should 
 be given for this business ? 
 
 A. I don't know that he had any specific sum in his mind. 
 
 Q. Did he not indicate that there must be paid such a sum for such purpose 
 or purposes, such purpose being so indicated by him I 
 
 A. I think I said to him that I thought the business would realize something 
 like 820,000. 
 
 Q. Was it not settled substantially upon $35,000 or 840,000, and was there 
 not a prospective distribution made of that amount to certain individuals 1 
 A. Not that I am aware of. 
 
 Q. Did you not have a conversation with Mr. Smythe respecting that distri- 
 bution ? Did not Mr. Smythe say to you that certain parties, certain friends, 
 had helped him and must be provided for I 
 
 A. My arrangement was to have been known as the firm of Van Bergen «5c 
 Co., and I suppose Mr. Smythe was anxious to help Van Bergen. But who 
 outside the firm was to be accommodated I do not know, except there might 
 have been one or two within the custom-house whose salaries he desire 1 to raise 
 out of this money. 
 
 Q. Was there not a certain portion of this designated as the political fund ? 
 A. Not that I know of. 
 
 Q. What relation is Van Bergen, if any, of Mr. Smythe, or what connection 
 is he or otherwise of his ? 
 
 A. 1 don't know positively. I think he is a cousin of his, or some relative 
 of that nature. 
 
 Q. Do you recollect the names of any other parties besides Van Bergen and 
 one or two in the custom-house who were to have been benefited by this ar- 
 rangement ? 
 
 A. Mr. Doolittle was to have been been benefited by it. 
 
 Q. To whom do you refer— to Senator Doolittle or his son ? 
 
 A. Senator Doolittle's son. 
 
 Q. Do you know the extent to which he was to have been benefited ?. 
 H Rep Com 30 4 
 
50 
 
 NEW YORK C08TOM-HOU8E. 
 
 A. No. 
 
 Q. Is Mr. Doolittle's son, to whom you refer, connected with the custom-house 
 now ? 
 
 A. I believe he is ; but I have never seen him. 
 
 Q. Do you recollect any other names besides Doolittle's in this regard ? 
 A. No. 
 
 Q. Do you recollect whether Senator Patterson's name was mentioned in this 
 matter ? 
 
 A. It was never mentioned to me, sir. 
 
 Q. Did you ever hear Mr. Smythe Bay that a certain woman should be bene- 
 fited or assisted in some shape ? 
 A. I never did. 
 
 Q. Have you ever heard or have you any knowledge of an agreement to pay 
 any sum for the privilege of storing general order goods by the present recip- 
 ients, Messrs. Myers & Smith 
 
 A. No. 
 
 Q. Have you any knowledge, derived from any source whatever, of any 
 arrangement by which they are to pay a percentage for this business ? 
 A. No. 
 
 Q. Do you know of any payment or payments having been made? 
 A. No. 
 
 Q. Did you ever receive any money, note, check, or obligation from B. C. 
 Johnson & Company, or any person in their employment, or interested with 
 them in connection with this matter? 
 
 A. Not a red cent. 
 
 Q. 1 ask the same question in regard to Atkins tV Edwards ? 
 A. I have received nothing from them. 
 
 Q. I also ask the same question in regard to Miller tS: Conger? 
 A. 1 have received nothing from Miller & Conger. 
 Q. 1 ask the same question as to Messrs. Lawrence 1 
 A. No, sir. 
 
 Q. Has Mr. Smythe ever received any money, or has he told you he has, or 
 have you any reason to know or believe he has received any valuable consider- 
 ation, from them or either of them, or does he expect to receive any considera- 
 tion from them \ 
 
 A. To my knowledge he has never told me, nor has any other person told 
 me so, nor have I received any knowledge in reference to it from any source. 
 Q. Have Miller <fc Conger promised to pay anything ? 
 
 A. I don't think they carried on the business at all j and, therefore, I don't 
 think they paid anything. 
 
 Q. Had not they the business at one time ? 
 
 A. No, it fell through ; before they consummated their arrangements they 
 relinquished it for some reason or another. 
 
 Q. There was an expectation if they received the business they were to pay ? 
 
 A. I suppose so ; but the arrangements made I know nothing of, as it was 
 taken out of my hands. 
 
 Q. Do you know whether Mr. Miller had promised to pay $40,000 in case 
 that business was given to him ? 
 
 A. No. 
 
 Q. Or Mr. Johnson ? 
 A. No. 
 
 Q. Or any other sum ? 
 A. No. 
 
 Q. Was any amount named to be given for this business by either one of 
 them or both, in case they received this business ? Was there a percentage or 
 gross amount named ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 51 
 
 A. Not to my knowledge. I may state at once, I know very little of this 
 arrangement except what was made originally with Mr. Bixby. My knowledge 
 of the business ceased when that fell through. 
 
 Q. What percentage or amount did Myers & Smith pay for the general order 
 business ? 
 
 A. I don't know. 
 
 Q. Do you know what they have engaged to pay ? 
 A. No. 
 
 Q. Do you know what they expect to pay 1 
 A. No. 
 
 Q. Have they ever told you they expected to pay anything ? 
 A. No. 
 
 Q. When they engaged you, and said they could not pay you a larger salary, 
 did they say that was because they had to pay something for this business ? 
 A. No. 
 
 Q. Did they at any time give you to understand they paid anything for it, 
 or that they expected to pay anything for it ? 
 A. No. 
 
 Q. Did they at any time give you to understand they were to pay a per- 
 centage for this business to some person or persons ? I understand it has been 
 said that this thing was fixed so that no congressional committee could get 
 hold of it. I now want to know on examination how much you are disposed to 
 disclose of the matter. 
 
 A. I have no hesitation in stating anything I know ; but, as I have said 
 before, this matter was not brought before me ; the whole thing was consum- 
 mated before I knew of it. The first intimation I had of it was from Myers. 
 
 Q. You said you acted for the collector as a sort of negotiator, previously ? 
 
 A. Yes. 
 
 Q. When did this agency of yours cease ? 
 
 A. It was "not in the form of an agency. It ceased as negotiator when my 
 negotiations with Mr, Bixby, in reference to this general order business, ceased, 
 and that business was given out, without my knowledge, to other parties. 
 When Miller & Conger got possession of it I don't know, and did not know 
 they had it until, thinking I would arrange with Bixby, I went and informed 
 the collector, and he told me that other parties had it; and, subsequently, I 
 learned from Miller he had it. Since then 1 know very little of the arrangement 
 
 Q. Have you ever seen any writing or figures, showing the monthly receipts 
 of the general order business of New York, or any part thereof, since July 1 1 
 
 A. I think Johnson at one time showed me figures for a month. 
 
 Q. Have you seen any such return since it has been with the present 2 
 
 A. No. 
 
 Q. Have they told you, or do you know of any such returns ? 
 A. No. 
 
 Q. Do you know why this return was made up by Johnson ? 
 A. No. 
 
 Q. In whose hands was it when you saw it ? 
 A. I saw it in Johnson's office. 
 
 Q, What reason was given for its preparation or the exhibition of it to you ? 
 
 A. I think it was at some suggestion of my own. I asked him how he was 
 getting along with his business, and he opened his books and showed me. 
 
 Q. You have stated that, at the commencement of Mr. Smythe's administration 
 of the custom-house, you did seek to make some arrangement for the general 
 order business, in which you were to have an interest. Did I understand you 
 to say that, after the arrangement with Bixby & Co. fell through, you did not 
 make any such arrangement, or seek to make any such arrangement, with any 
 person 1 
 
52 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. I sought to make a similar arrangement with Miller Conger; tliat i , f,. 
 give them my services for a certain amount ; hut there was nothing definitely 
 settled, because the business fell through without going into operation. 
 
 Q. After the Miller & Conger affair fell through, how was it with the next? 
 "Was there any other proposition made to you hy Myers tV Smith other than 
 the salary they agreed to pay you — that is, the present arrangement? 
 
 A. No. 
 
 Q. WaB there any agreement to go into operation hereafter as to a share in 
 the receipts for this general order business ? 
 A. No. 
 
 Q. Did you receive, or did Mr. Smythe receive, or did either of you expect 
 to receive, any money or other valuable consideration for or from the cartage- of 
 imported merchandise, cVc? 
 
 A. ] did not, and I have no knowledge of his having done so. 
 
 Q. Have you ever heard Mr. Smythe say anything on that subject ? 
 
 A. Yes. i endeavored to make arrangements at one time with some parties 
 for the cartage, but they were not consummated. 
 
 Q. Who has that business now? 
 
 A. I don't think I can name the firm; Lindsey was one, but he is now dead. 
 
 Q. Has the firm to which he belonged the business now? 
 
 A. I suppose they have ; but I have no knowledge. 
 
 Q. Do you know the conditions on which they received it? 
 
 A. I do not. 
 
 ( w >. Have you received, or has Mr. Smythe, as far as you know, received any 
 money or valuable consideration, directly or indirectly, on account of the gen- 
 eral order business in Brooklyn or in .Jersey City, or in either of these places I 
 
 A No. 
 
 Q. Did yon seek to exercise, or did you exercise, as you have reason to be- 
 lieve, any influence in the appointment of Mr. Smythe as collector 1 
 
 A. As a friend of his, I did what I could to secure the position for him. 
 Q, Did you go to Washington '. / 
 A. I did. 
 
 Q. Had you conversations there with members of Congress or senators ? 
 A. Not with senators. 
 
 Q. Did you see Senators Doolittle'or Patterson while you were there 1 
 A. No. 
 
 Q. Did you hold out any inducements to friends or persons, that provided 
 Mr. Smythe was appointed, certain things would be done, or certain appoint- 
 ments made, or money or office would be given ? 
 
 A. No such inducements that I recollect, further than that I conceived Mr. 
 Smythe would be the best man, and the natural consequence would flow from 
 his appointment, but nothing like money or office or anything of that kind was 
 mentioned. 
 
 Q. Did you see the President when you went to Washington ? 
 A. I did. 
 
 Q. What representations did you make to him on this particular ? 
 
 A. I said that in the first place Mr. Smythe was a republican, and a popular 
 merchant who stood well in our community, and. that I believed his appoint- 
 ment would be satisfactory to the community in general. The President re- 
 marked he was glad to hear he was a republican, as he could not, under the 
 circumstances, appoint a democrat. 
 
 Q. Was anything said either by yourself or by the President about any 
 person to be benefited or provided for, or that should be or must be provided 
 for in case Mr. Smythe was appointed ] 
 
 A. No, sir ; no reference was made whatever. 
 
 Q. Have you any reason to believe that Myers k, Smith pay anything, or 
 
NEW YORK CUSTOM-HOUSE. 
 
 53 
 
 are to pay anything to Mr. Smythe, by which certain parties whose names have 
 been mentioned here are to be benefited ? 
 
 A. No, sir; I have nothing to base any reason of that kind on. 
 
 Q. Have you heard Mr. Smythe say that any part of the money received 
 from the general order business was to go to Senator Doolittle or to Senator 
 Patterson, or to any of their families, or friends, or relatives, or words to that 
 effect ? 
 
 A. No. 
 
 Q. Did you ever hear Mr. Smythe say that any money he should receive by 
 reason of his being collector, or from seizures, or from the general order busi- 
 ness, or in any other way, was to be paid to any person ? 
 
 A. No. 
 
 Q. Did you ever hear Mr. Smythe say he was under the necessity of paying 
 or providing for a certain amount or amounts at Washington ? 
 
 A. No. The most I ever heard Mr. Smythe say about payments of money, 
 was something like this : " He did not know where he was to get money to pay 
 all the calls for money made on him for various purposes." That was all I 
 heard him say ; but he never specified any case. 
 
 Q. Were you present at the office of John B. Stevens when an arrangement 
 was made with Myers & Smith about the general order business ? 
 
 A. I was not. 
 
 Q. Do I understand you to sa} T you do not know any arrangement between 
 Myers & Smith and Mr. Smythe 1 
 A. No. 
 
 Q. Who represented Smythe on that occasion 1 
 A. I don't know. 
 
 Q. Why was the business taken from Edward Atkins & Co. and given to 
 Myers & Smith ? 
 
 A. For overcharges, I suppose. 
 
 Q. Do you know what Edward Atkins & Co. were to pay, or did you hear 
 Mr. Smythe say ? 
 A. No. 
 
 Q. Do you believe they were to pay anything ? 
 A. I don't know what my belief is. 
 Q. You have an opinion ? 
 
 A. I suppose they paid somebody something; but who, or what, I don't 
 know. I am certain I got nothing. 
 
 Q. Consider the same question put to you in reference to Myers & Smith ? 
 A. I should say not. 
 Q. You don't know ? 
 A. No. 
 
 Q. Do you know whether Edward Atkins & Co. agreed to pay Johnson 35 
 per cent., for their business ? 
 
 A. I have heard they made such an arrangement with them. 
 
 Q. Did you ever hear Myers & Smith agree to pay a sum to Johnson ? 
 
 A. No. " 
 
 Q. Did Mr. Smythe ever say to you he was not satisfied with the returns 
 Edward Atkins & Co. made of their business ? 
 
 ( A. He said numerous complaints were made of the firm for overcharges and 
 the like. 
 
 Q. I asked you if Mr. Smythe made any remark to you that he was not 
 satisfied with the amount of business that Edward Atkins & Co. rendered, or 
 the aceount they rendered him of their sales ? 
 
 A. No. 
 
 Q. Do you not know they were required to submit a statement of the gross 
 amount of their receipts to the collector ? 
 
54 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. No. 
 
 Q. Do you know whether they did do ho or not? 
 A. I do not. 
 
 ( v >. Did Mr. Smyths ever say that he was not getting from that source what 
 he expected to get, or what he ought to get ? 
 A. Not to me. 
 
 Q. Did yon ever hear of his. having said bo to any persons, or of his having 
 used words to that effect ? 
 A. No. 
 
 Q. Did Mr. Smythe have a quarrel with Johnson & Co.? 
 
 A. I don't know what the ditHculty was. I only know the complaints against 
 Johnson were frequent and numerous, and that Myers & .Smith got the business 
 from them; but whether it was owing to the complaints made against them, or 
 for other reasons, I don't know. 
 
 Q. You have no knowledge of how they got it, and had nothing to do with 
 the negotiation ? 
 
 A. No. 
 
 Q. Were you not requested by Mr. Smythe, either verbally or in writing, to 
 have something to do with it ? 
 
 A. I was not requested by him to have anything to do with it ; and, as I 
 said before, the first thing I knew of it was when 1 heard it from Myers. 
 
 Q. Do you know Senator Patterson ? 
 
 A. I have seen him here and in Philadelphia. 
 
 Q. When did you see him here last ? 
 
 A. I should say about a month ago. 
 
 Q. Where did you see him ? 
 
 A. At the St. Nicholas hotel. 
 
 Q. Did you have any conversation with him then about the general order 
 
 business ? 
 A. No. 
 
 Q. Did you have any conversation with him about Mr. Smythe's operations ? 
 A. No ; the matter did not come up. 
 
 Q. Did you have any conversation with Senator Patterson in reference to 
 this matter in any way ? 
 
 A. I did not speak a word to him about it. 
 Q. Did he speak to you about it ? 
 A. No. 
 
 Q. Do you know Ilanscomb, of Washington ? 
 A. I do. 
 
 Q. Had you ever any conversation with him in reference to this business ? 
 A. No. 
 
 Q. Had you ever any conversation with Mr. Huntington, of the firm of Jay 
 Cooke & Co.? 
 A. I had. 
 
 Q. State what that conversation was. 
 
 A. It was a general conversation. He was, like myself, a friend of Mr. 
 Smythe, and anxious for his appointment, and I was with him a great deal while 
 I was in Washington. I saw him here once, and the general order business 
 came up, but nothing particular was mentioned, or anything bearing particularly 
 on these points. 
 
 Q. Was Huntington made aware of the nature of this general order business ? 
 
 A. I don't think he understood the particulars of it. I told him I was making 
 some arrangements with Bixby & Co., and hoped to benefit myself. I spoke in 
 a general way. 
 
 Q. How long have you known Mr. Huntington ? 
 
 A. Perhaps a year or two. 
 
NEW YORK CUSTOM-HOUSE. 
 
 55 
 
 Q. What are his relations with President Johnson, as far as you know 1 
 A. I believe they are friendly. 
 
 Q. What are the social relations of Senator Patterson and Mr. Huntington ? 
 A. I don't know. 
 
 Q. Why was this matter talked over to Mr. Huntington by you ? 
 
 A. As I remarked, he was exceedingly anxious about Mr. Smythe's appoint- 
 ment, and all matters connected with it naturally came up in conversation between 
 us. 
 
 Q. Why was he exceedingly anxious ? 
 
 A. Because he was an intimate friend of Smythe's, and I believe they trans- 
 acted business together through their banks. 
 
 Q. Do you know Mr. Coyle, of the Intelligencer office, at Washington ? 
 A. I know him slightly. 
 
 Q. In this talk with Mr. Huntington, did he say to you, or did you say to 
 him, or did he give you to understand, he was interested or expected to be in- 
 terested in this general order business ? 
 
 A. No, sir. 
 
 Q. Did Mr. Coyle tell you so ? 
 A. No. 
 
 Q. Did Mr. Coyle ever tell you he had or claimed to have, or say he expected 
 to have? 
 
 A. I don't think I spoke to him about the business at all. 
 
 Q. Did you ever hear him speak of Mr. Smy the ? 
 
 A I did. 
 
 Q. In what way ? 
 
 A. In a denunciatory manner. 
 
 Q. What reasons did he give for speaking of him in that manner ? 
 
 A. It was, I believe, in consequence of Mr. Smythe's not having carried out 
 with him something which he expected he would have done. 
 
 Q. Are you cognizant of any arrangement with either Hanscomb or Hunt- 
 ington whereby they were to be paid any sums, provided Mr. Smythe was ap- 
 pointed collector ? 
 
 A. I don't know of any. 
 
 Q. Do you know of a like arrangement with any other person ? 
 A. No. 
 
 Q. Do you know whether Senator Patterson was to be benefited, or expected 
 to be, in case Mr. Smythe was appointed collector? 
 A. I do not. 
 
 Q. Do you know whether Senator Doolittle was to be benefited, or expected 
 to be, in case Mr. Smythe was appointed collector ? 
 A. I do not. 
 
 Q. Have you had any conversation with Mr. Smythe lately, touching this 
 general order business 1 
 
 A. I have not spoken to Mr. Smythe since his return from the country — I 
 should say about a fortnight ago. 
 
 Q. You have seen him and met him frequently ? 
 
 A. Two or three times a week. 
 
 Q. Were you at Myers & Smith's warehouse on the 2d of January last 1 
 A. I do not recollect ; I might have been there ; but I cannot fix the date. 
 Q. Were you there for the purpose of collecting any money for the purpose 
 of general order business ? 
 A. No. 
 
 Q. Were you there any time last week ? 
 
 A. I was ; but not in reference to this business. 
 
 Q. I understand you to say you did act for the collector in the matter of a 
 negotiation with Bixby & Co. ? 
 
56 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. I acted perhaps more for myself than I did for the collector; it was a 
 business I was very anxious about — quite as much so, and perhaps more than 
 
 the collector, and I endeavored to make an arrangement. 
 
 Q. It is not a fact that this same sort of agency or connection, or whatever 
 you call it, of yours with Smythe has continued ever since ? 
 A. No ; it has not. 
 Q. Either verbally or written ? 
 A. No ; nor implied. 
 
 Q, Do you know Mr. Smythe's handwriting? 
 
 A. Yes. (Note handed to witness.) 
 
 Q. Do you know whose handwriting that is ? 
 
 A. It is Mr. Smythe's signature; but the body of the letter is Mr. L< land - 
 writing. 
 
 Q. Are you pretty well acquainted with Mr. Smythe's handwriting in figures 
 as well as in words ? 
 
 A. I am pretty familiar with it. (A memorandum was here handed to wit- » 
 ness with figures in pencil mark on it ) 
 
 Q. Look at these figures and n il the committee if you have any idea as to 
 who made them. 
 
 A. I should say it was not Mr. Smvthe's? 
 
 Q. What reason have you to think it is nol f 
 
 A. 1 don't think the characters correspond. I should think this was not 
 Mr. Smythe's, but 1 would not like t<> swear to it cither way. 
 
 Q. At the time you supposed you had concluded an agreement with Bixby 
 & Co., you went to the collector to see if he would confirm it, and he informed 
 you at the time he had sold the general order business for S 10,000 to Miller & 
 Conger. Is that so } 
 
 A. lie would hardly listen to what I had to say, and when I had concluded 
 he remarked he had disposed of the business to Miller & Conger, and that 
 they were willing to pay for it some forty thousand dollars. That ended tin 
 matter so far as 1 was concerned with Bixby & Co. 
 
 New York, J inuary 16, 1867. 
 GEORGE F. THOMSON recalled and examined. 
 
 By the CHAIRMAN : 
 Q. Were you ever connected with the Daily News, of New York? If so, 
 state when and how long you were connected with it, and when your connection 
 ceased. 
 
 A. 1 was editor of the Daily News from the year 1S56 to the year 1S60. In 
 September, previous to the presidential election, owing to illness, I retired from 
 its control; and from that time to the present I have had no connection what- 
 ever with it in any way. I was never associated with Mr. Wood in any way 
 in that paper. 
 
 Q. Were you ever arrested by the Secretary of War ? And if so, state the 
 circumstances. 
 
 A. I was arrested, by order of the Secretary of War, by the United States 
 marshal of this city, and my papers seized. The cause I never positively knew. 
 I supposed I had been reported by some one as being one of the editors of the 
 Daily News, with which paper my connection had ceased two years previously. 
 I was taken to Washington, and I there requested to be brought before the 
 Secretary of War, Mr. Stanton, and I asked him the cause of my arrest. He 
 was, until then, ignorant of the fact. He called upon his assistant, (Mr. Wool- 
 cott, I think,) and asked him in reference to it. It appeared this gentleman had 
 
NEW YORK CUSTOM-HOUSE. 
 
 57 
 
 issued the order without instructions, and I was immediately released on my 
 parole. I was then subpoenaed before the committee then examining- Ben. Wood, 
 and on the close of my testimony I was fully discharged, my papers were given 
 me back, and I was allowed to return home. 
 
 New York, Tuesday, December 18, 1866. 
 GEORGE W. EMBREE sworn and examined. 
 By the Chairman : 
 
 Q. How long have you been in the custom-house, and what is your official 
 position there? 
 
 A. About six years. I am deputy collector at large. 
 
 Q. Under Mr. Smythe's administration of the custom-house, have you been 
 at the same desk, and in the same capacity, discharging the same duties as 
 before? 
 
 A. Yes, with the exception of about — I cannot say exactly the time — two 
 or three months. 
 
 Q. "What position did you hold there? 
 
 A. I was deputy at large; a position conferred on me by Mr. Smythe or by the 
 Secretary, at the request of Mr. Smythe. 
 
 Q. What particular branch of the business were you in before ? 
 A. I had the clearance bureau. 
 
 Q. After receiving this appointment what additional duties had you, and 
 when were these duties imposed on you ? 
 
 A. It was after the creation of a bureau that had not existed before. There 
 was no officer of the custom-house who had supervision of the whole collection 
 district. It was my intention to have embraced the whole district in my duties — 
 that is, to have gone to Albany or anywhere in the district that there was any 
 necessity for or where there was anything wrong, and where the collector's au- 
 thority was required, besides taking the general supervision of the custom-house 
 appraiser's department. 
 
 Q. Did you have any knowledge of the negotiation with Miller & Conger 
 in reference to the general order business? 
 
 A. Incidentally I had; but only incidentally. At the time the Miller & 
 Conger affair was talked of I was engaged in other matters. The collector had 
 asked me to go through the custom-house and exercise my judgment in refer- 
 ence to "he employes — if there was an unfaithful one to report him, and if a good 
 one to promote him. 
 
 Q. Give the committee what knowledge you have directly or indirectly of 
 that affair. 
 
 A. It will be very brief. My impression is — I know — §40,000 was offered 
 by Miller & Conger for this general order business. I had a number of inter- 
 views with them myself. * 
 
 Q. Do you know how that $40,000 was to be distributed ? 
 
 A. I do not. 
 
 Q. You never heard from Mr. Smythe or any other person as to that? 
 A. I was trying to think of that. There were certain parties that were to be 
 taken care of, but I cannot say that it was to be out of this fund. 
 Q. Who were the parties ? 
 
 A. It seems to me that Senator Doolittle's son was to have a position — Colo- 
 nel Doolittle. 
 
 Q. Was there any sum directly paid to any one — to Mr. or Mrs. Patterson? 
 A. There was something about some money in that direction, but I cannot 
 say whether it came from the collector or not. 
 
58 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Do you recollect the amount it was proposed Doolittle's -mi should get, 
 or was it only a situation? 
 
 A. I cannot tell what it was — whether it was to he paid in cash, or he to get 
 
 a position. 
 
 Q. Was there any other person connected with it whom you can distinctly 
 recollect '( 
 
 A. Yes, sir. I think Mr. Johnson was to have charge of the business, and 
 was to receive a consideration; hut whether in the way <>f commission or not, I 
 cannot say. 
 
 Q. What about Van Bergen & Co.? 
 
 A. Van Bergen was to have a position. My impression is Van Bergen and 
 Thomson were of the firm that were to haw control of tin- genera] order busi- 
 ness. The title was Van Bergen & Co. Mr. Smythe said to me more than 
 once that there should be no political tax levied in the New York custom-house, 
 and that it was in lieu of that tax this money was to lie raised; and I so pro- 
 mulgated it. 
 
 Q. Was there, or was there not, any political tax levied in the New York 
 custom-house? 
 
 A. There was, last fall, but it was Stopped in mid career, for the collector 
 disavowed the whole thing. The parties who came said they came from some 
 outside politicians. 
 
 Q. Do you know from whom? 
 
 A. I cannot remember the names of some of them. Mr. Smyths was anxious 
 my salary should be increased; but that had nothing to do with it. 
 
 Q. Somebody proposed you should receive two or three thousand dollars out 
 of this? 
 
 A. I don't recollect that Mr. Smythe mentioned any particular sum. He said 
 he should be glad I should receive compensation for my services. 
 
 By Mr. Rollins: 
 
 Q. To be paid out of this sum ? 
 A. No, sir. 
 
 Q. Well, how did he mention it ? 
 A. In conversation. 
 
 Q. You say you had a negotiation with Mr. Smythe in reference to an in- 
 crease of your salary ? 
 
 A. Not a negotiation ; he mentioned it in course of conversation. 
 Q. Is not your salary according to law ? 
 A. It is. 
 
 Q. Did you think at the time he had reference to legislation ? 
 
 A. Of course. 
 
 Q Did you suppose so ? 
 
 A. As a matter of course I did. 
 
 Q. How did he manage it ? 
 
 A. He intimated to the Secretary that it ought to be increased, and there was 
 an increase made of $500. 
 
 Q. Do you know why this arrangement with Miller & Conger fell through 
 and was not consummated 1 
 
 A. Yes, sir ; I am inclined to think there was another negotiation started by 
 Mr. Thomson, (but what that was I never understood,) which was thought 
 would be better. 
 
 Q. Do you know of Mr. Smythe directly or indirectly endeavoring to obtain 
 any money consideration or valuable consideration for this general order busi- 
 ness, or cartage business, from any person for the privilege of storing general 
 order goods or carting importers' merchandise ? 
 
 A. There was a variety of applications made for the general order cartage and 
 
NEW YORK CUSTOM-HOUSE. 
 
 59 
 
 lighterage. A great many of these passed through my hands in this way : Mr. 
 Smythe did not want the applicants round him, and would say, " Go to Mr. 
 Embree." I would take their applications, put them in an envelope, and hand 
 them to Mr. Smythe. I did not consider that I had any right to look into the 
 applications, as they were addressed to the collector. Some were brought open 
 and I saw them. I think there was one application for the cartage — I think 
 $15,000 was offered. 
 Q. By whom? 
 
 A. I don't remember the names? 
 
 Q. Do you know whether the arrangement was made ? 
 
 A. I presume not ; I subsequently learned it was not. I was taken sick, and 
 lay on my back for five weeks, during which time Mr. McElrath, who had taken 
 my place, had been transferred to the appraiser's office, and I requested to be 
 allowed go back to my old place. 
 
 Q. Who finally did get the general order business ? 
 
 A. I was told Mr. Johnson did. 
 
 Q. Do you know the terms ? 
 
 A. No, sir. 
 
 Q. Have you ever heard from Mr. Smythe, or any one else who knew, what 
 he was to pay ? 
 
 A. I have heard, but from whom I am now unable to say — not from the party 
 interested — that thirty-five per cent, was the price. 
 Q. Do you know what was to be done with that ? 
 A. I have no idea. 
 
 Q. Did you ever hear Mr. Smythe say he should make some money out of 
 his general order business, or words to that effect ? 
 
 A. I have heard him say so a number of times, but not in reference to per- 
 sons ; it was in reference to this tax. 
 
 Q. When he said political purposes, was he confined to the tax that was 
 levied on the'employes of the custom-house ? Was that all the purpose he was 
 to use it for ; or was it for persons higher up ? 
 
 A. I cannot say ; that was what Mr. Smythe said to me. And I was never 
 more surprised than when the list was laid on my desk for the purpose of 
 raising a political tax. He told me distinctly he would not allow it. 
 
 Q. Did you ever hear Mr. Smythe say that Senator Doolittle, or Senator 
 Patterson, or any me mber of their families, should receive, or that he contem- 
 plated they should receive, any money or consideration growing out of the 
 general order business, cartage or lighterage, or any other business connected 
 with the custom-house — themselves individually, or their families, directly or 
 indirectly ? 
 
 A. Mr. Smythe and myself frequently conversed in reference to this general 
 order business. Their names were mentioned at various times, and possibly in 
 connection with this general order business. But I do not remember at any 
 time that he said he should pay directly from this fund any of these parties. 
 
 Q. From any fund, I said. 
 
 A. I don't know of any other fund. 
 
 Q. But did he ever say they were to receive, or should receive, or must re- 
 ceive something, no matter from what fund ? 
 A. No, sir, I think not. 
 
 Q. And yet I understand you to say their names were mentioned in connection 
 with this ? 
 
 A. Yes, sir ; but the difficulty with me is to recollect the time their names 
 were introduced. 
 
 Q. If you cannot recollect the conversation, cannot you give the committee 
 the impression these different conversations and the allusions to this subject 
 made on your mind 1 
 
GO 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. There was a general impression on my mind that, as a matter of course, 
 they were to be benefited ; whether by position or whether by a part of this 
 fund, I cannot say. 
 
 By Mr. BftOOMALL : 
 Q. Who do yon mean by " them? " 
 A. The parties named in the chairman's question. 
 
 Q. Was any member of Mr. Patterson's family in a position to take an 
 appointment ? 
 
 A. I cannot say ; I am not acquainted with Mr. Patterson ; I was introduced 
 to Mr. Doolittle. 
 
 Q. Have you any knowledge or belief, and if so, state the reasons of your 
 belief, that any check or valuable consideration, or money, has gone from Mr. 
 Sinythe to any of these persons named, or from Mr. Thomson, or .Johnson, the 
 representative of the general order business, or .any one else connected with it ? 
 
 A. Never one cent. I never heard any money talked of as having passed so. 
 I never heard of or saw any check or money being paid to these parties in con- 
 nection with the general orders or anything else. 
 
 Q. Do you know when Senator Doolittle's son received his appointment? 
 
 A. I do not. I simply remember to have heard he was made a weigher. I 
 think it was about the time I was sick — perhaps three months ago. 
 
 Q. Do you know anything of him personally? 
 
 A. I have simply been introduced to him. 
 
 Q. Do you know anything of his attention to business? 
 
 A. No, sir. 
 
 Q. Has there been any complaint to your knowledge about him? 
 
 A. No, sir. Since I have been sick I have taken my regular desk and have 
 done little in connection with the business of the deputy at large. In fact, I 
 drew myself as quietly as I could into my old place, my health requiring it. 
 It was only incidentally I heard of Mr. Doolittle having his place. 
 
 By Mr. Rollins : 
 
 Q. You spoke of some list that was placed on your table for assessment meant 
 for political purposes; who placed this on your table? 
 A. One of the clerks, named Daniel Jackson. 
 Q, What is he? 
 A. One of the clerks. 
 
 Q. What instructions did you receive in reference to it? 
 
 A. No instructions. This list was brought to my desk, and he said it was 
 expected the employes of the customdiouse would give something for political 
 purposes. I asked did Mr. Smythe know this ; and he said he did not know. 
 " Well," said I, " I will know before I contribute." 
 
 Q. Was it a percentage exacted, or what? 
 
 A. It was left to the discretion of the giver. 
 
 Q. What percentage did they give ? 
 
 A. I did not make up the percentage; but there was some S150 or S160 
 contributed. 
 
 Q. Did you call upon Mr. Sinythe in reference to the matter ? 
 A. I did; and he ignored the whole thing. He said he understood outside 
 parties had done it. 
 
 Q. Still the collection was made ? 
 
 A. I think it was. 
 
 Q. Did you contribute? 
 
 A. I gave $25. 
 
 Q. For what purpose? 
 
 A. I cannot tell; I know it was a usual thing for assessments to be made, 
 
NEW YORK CUSTOM-HOUSE. 61 
 
 and I thought it better to ask no questions, but conform to the usage that seemed 
 to be adapted in all the bureaus in reference to this fund. 
 Q. Was it in support of the radical party? 
 
 A. It was not. I had the satisfaction of contributing to that subsequently. 
 
 Q. What was it for? 
 
 A. I presume for political purposes ? 
 
 Q. Did you know that the President of the United States had over his own 
 signature condemned the payment of money, by men holding office, for political 
 purposes ? 
 
 A. I did not know Mr. Johnson had done so. 
 
 Q. Did you know Mr. Johnson commended a clerk in the War Department 
 at Washington for refusing to contribute in this manner? 
 A. I recollect that case. 
 
 Q. Then it was within your personal knowledge that the President of the 
 United States condemned it? 
 A. Not sir; not at that time. 
 Q. Did you know it at the time ? 
 
 A. 2s o, sir ; I learned it subsequently. I had a subsequent conversation with 
 the collector. I regretted that I had contributed a single cent to the fund; my 
 heart did not go with it. 
 
 Q. Is it not a fact that the officers of the custom-house have deliberately al- 
 lowed a plan for the collection of money for political purposes, when they knew 
 President Johnson officially condemned the whole thing? 
 
 A. No, sir; certainly not. The plan was not laid in the custom-house. 
 
 Q. Was it not a fact that the officers of the custom-house entered into an 
 arrangement with Miller & Conger to receive 840,000 — a portion of that to be 
 reserved as a political fund ? 
 
 A. I know nothing about that 
 
 Q. Have you not already sworn that a portion of that fund was to be used 
 in lieu of a political levy ? 
 A. Yes, sir. 
 
 Q. Was it not a fact, then, that that arrangement was made and subsequently 
 broken, and that a portion of the fund was to be used for political purposes in 
 lieu of the assessments of the employes after they knew the President had dis- 
 approved of the usage? 
 
 A. The custom-house had nothing to do with it ; it was the collector of the 
 port. 
 
 Q. Who is Mr. Thomson, whose name figures here in this transaction ? 
 A. A friend of Mr. Smythe. 
 
 Q. Who is he ? What has been his history during the war ? 
 A. I don't know. 
 
 Q. Do you not know he was an editor of Ben. Wood's organ during the war, 
 and has been under arrest ? 
 
 A. No, sir ; it has been told me he was a copperhead, but I know nothing of 
 
 it. 
 
 Q. Do you wish it to be understood you don't know Mr. Thomson as being 
 one of the editors of the News ? 
 
 A. I do ; I don't know anything of him. 
 
 Q. Do you or do you not believe he was editor of the News during the war ? 
 
 A. I know nothing of it. 
 
 Q. What is your belief? 
 
 A. I have no belief. 
 
 Q. Have you heard anything of it ? 
 
 A. I have heard, incidentally, that he was an editor of some of these papers. 
 Q. Did you ever hear he was editor of the News ? 
 
62 
 
 NHW YORK CUSTOM-HOUSE. 
 
 A. I beard lie was editor of some paper; my inference is lie was editor of 
 some paper that was disloyal. 
 
 Q. What do you believe about it now ? 
 
 A. I have no belief. I have no doubt he was connected with some paper 
 disloyal to the government. 
 
 Q. Have you any doubt he was connected with Ben. Wood's paper? 
 A. I cannot say. 
 
 Q. Do you believe he was connected with the News? 
 A. 1 believe nothing of it. 
 
 Q. Do you or do you not believe he was connected with it ? 
 
 A. That is a matter I cannot answer. 
 
 Q. You can tell whether you believe it or not ? 
 
 A. I don't believe particularly the News was mentioned to me. I have no 
 disposition to conceal anything. 
 Q. Then answer the question ? 
 
 A. How can I answer the question ? I have no belief. 
 Q. You know whether you believe him to be connected with the News or 
 not? 
 
 A. I answer it in the way I have already answered it; I don't know whether 
 it was the News or not ; 1 think he was connected witli some paper. 
 Q. You either "believe it or not; now which is it ? • 
 A. There are a great many things about which I have no opinion. 
 Q. Do you believe he was arrested and taken to Fort Lafayette ? 
 A. I heard he was. 
 Q. Do you believe it? 
 
 A. I am inclined to believe it was the case. 
 
 Q. Then you really believe he was arrested and taken to Fort Lafayette ? 
 A. I believe that because I have heard it. 
 Q. Then why not believe he was connected with the News ? 
 A. Because my memory does not serve me. But I know that he was con- 
 nected with some paper disloyal during the war. 
 Q. Then was he a proper person to be rewarded 1 
 A. No, sir. 
 
 Q. Then you disapprove of the policy of rewarding men by office or by con- 
 tracts who were aiding in the conduct of disloyal papers during the war ? 
 A. Most assuredly. 
 
 Q. What negotiation did you have with him about this transaction ? 
 A. None. 
 
 Q. What was said in your conversation with Mr. Thomson ? 
 A. There was nothing said of a specific character. 
 Q. What was there of a general character ? 
 
 A. The collector's matters were almost always the subject of conversation, 
 I cannot remember the conversation. 
 Q. What was the general current? 
 
 A. The collector's matters were discussed. I don't recollect any particular 
 facts in connection with it that impressed themselves upon me at the time. Mr. 
 Thomson was a gentleman whom I never admired. 
 
 Q. How came he to come to you to negotiate about the matter ? 
 
 A. He came to get the applications that were made by these people, and, 
 knowing he was intimate with Mr. Smythe, I gave them to him. 1 would say, 
 " Here is an application for the collector ;" or, if it had been opened, I would 
 say, "Here is an application for" so and so. 
 
 Q. Did you hand these offers to Mr. Thomson ? 
 
 A. Yes, sir. 
 
 Q. Were Mr. Thomson's relations with the collector such as to have you put 
 into his hands these applications ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 63 
 
 A. They were very friendly; and I knew it was intended to place this gen- 
 eral order business in his hands. 
 
 Q. And do you think it was right to place these things in his hands ? 
 A. Yes, sir. 
 
 Q. And you yet thought he was not a proper person to bold this place ? 
 A. Yes, sir. But I covered my tracks, for I asked the collector if these 
 things had been received. 
 
 Q. What led you to place these papers in Thomson's hands t 
 A. The facts I have already stated. 
 
 By Mr. Broomall : 
 Q. Had you directions from Mr. Smythe to submit these things to Mr. Thom- 
 son? 
 
 A. He told me, from time to time, that Mr. Thomson would see about these 
 matters ; but I am not sure that he said to me I might give the applications to 
 him. On one or two occasions Mr. Thomson came from the collector to ask 
 for these applications. 
 
 Q. Did he bring you a written message or a verbal one ? 
 
 A. Merely verbal. 
 
 Q. Then you regarded his relations with the collector as confidential 1 
 A. I did. 
 
 Q. Did you know a clerk of the name of Davidson being appointed 1 
 A. There was a young man of that name in the warehouse. This man I 
 refer to was turned out of the custom-house. 
 Q. What for? 
 
 A. Some nefarious transaction or other, I think. 
 
 Q. Was he not an inspector, and did he not receive a certain amount of 
 money for passing baggage ? 
 
 A. That is it, sir. He had been made an entry clerk, and it is their habit 
 to go on board ship, and he received some money for acting in the way you say. 
 
 Q. Do you know of any transaction when he did. so receive money 1 If so, 
 state the amount and what was done with it. 
 
 A. I think it was in connection with this transaction. I don't recollect what 
 the amount was. 
 
 Q. There was a transaction of that kind 1 
 
 A. There was. 
 
 Q. And he was brought up and discharged ? 
 A. He was. 
 
 Q. Has he not since received an appointment in connection with the custom- 
 house I 
 
 A. I think I heard something last week about an appointment ; but whether 
 he was taken into the custom-house or not I cannot say. 
 Q. Do you know who recommended him 1 
 A. I don't know. 
 
 Q. Would his appointment not come from the collector direct ? 
 A. If he received it in the custom-house it would come from him. 
 Q. Is he not now on the staff of the custom-house 1 
 A. I cannot say. 
 
 Q. I think you said he was appointed % 
 
 A. I said I heard of his receiving an appointment, but whether in the custom- 
 house or not I cannot say. My impression is it was in the custom-house. 
 
 Q. What w r as done with him for this breach of faith 1 After gambling away 
 money belonging to the United States was he not tried and sent to the Tombs i 
 
 A. He was arrested, but what subsequently took place I don't know. 
 
 Q. You have stated that your understanding of the present arrangement ia 
 that those having the general order business pay 35 per cent. 1 
 
64 NEW YORK CUSTOM-HOUSE. 
 
 A. I beard that outside, bit. I never conversed \s it li th<- collector on the 
 
 subject 
 
 Q. The arrangement with the parties who were to pay 4 10,000 fell through, 
 
 and consequently Johnson and Thomson received the busine 
 
 A. Mr. Johnson was th« party whose name 1 heard mentioned. 
 
 Q. Prom your knowledge of the business, is it likely that it would have heen 
 given to these parties without consideration of any kind after a bargain which 
 was to pay $40,000 ? 
 
 A. You ask me whether I know there was a consideration given. I say I 
 don't know. 
 
 Q. I want to get your impressions. 
 
 A. I should think not. 
 
 Q. From your knowledge of the business is the report thai they pay 35 pet 
 cent, a probable fact, knowing, as you do, an arrangement was at one time made 
 for the sum of $40,000 ? 
 
 A. I was trying to think whom I received this knowledge from. 
 
 Q. Did you ever receive any information of the present arrangement from 
 
 Thomson or .Johnson ? 
 
 A. I never did. 
 
 Q You cannot tell where you got the information? 
 
 A. I cannot tell. My impression is it came from some storekeepers. 
 
 Q. From one of these men who Were to pay 35 per cent 1 
 
 A. No, sir. 
 
 Q. What are your impressions about this 3'> per cent.? 
 A My impression is, it would be paid. 
 
 Q. Now, if that is paid, to whom would it be paid, cxcepi to the collector? 
 A. I don't know, sir. 
 
 Q. Is there any one else in a position to get it except the collector? 
 A. Only him, or somebody authorized by him. 
 
 Q,. In this conversation with the collector about the persons to be provided 
 for, you spoke of Senator Patterson, Senator Doolittle, and the members of their 
 families ; can you designate, so as to get at the matter closely, what members of 
 their families you meant ? 
 
 A. No, sir ; I cannot. 
 
 Q. "When did you last converse with Smythe about its being necessary to 
 make some provision for these people? How lately? 
 
 A. I don't think I understand the question. I never addressed him as to 
 there being any such necessity. 
 
 Q. When did you last converse with Mr. Smythe about his intention to make 
 provision for these people ? 
 
 A. It was alluded to, but I cannot now fix upon any particular time that the 
 subject was mentioned. 
 
 Q. Was it before or after the failure of the negotiations with Miller & Conger? 
 
 A. I should think it was about that time. 
 
 Q. Do you recollect whether it was after the failure ? 
 
 A. I cannot remember, sir. I should think about that time ; perhaps before, 
 perhaps after. 
 
 Q. Can you recollect whether you had any such conversation with Mr. Smythe 
 after Mr. Johnson had charge of the business ? 
 A. I never had. 
 
 Q. You have said that your understanding of .the matter was, that this forty 
 thousand dollars was, in part, to be used instead of levying a tax on the officials ? 
 A. Yes, sir. 
 
 Q. You have also said that such tax was levied, but Smythe denied having 
 authorized it % 
 A. Yes, sir. 
 
NEW YORK CUSTOM-HOUSE. 
 
 65 
 
 Q. Now will you state whether any reference was made in this conversation 
 with Mr. Smythe to the money that came from the general order business being 
 placed in lieu of a collection, and that, therefore, it was wrong to make a 
 collection ? 
 
 A. It is my impression that my question to the collector did not cover as 
 much ground as that. I simply alluded to the collection then being made, and 
 all I desired was to ascertain whether he authorized it or not. 
 
 Q. Was anything said in this conversation about any other fund ? 
 
 A. Xo, sir. 
 
 Q. He said he did not authorize it ? 
 A. Yes, sir. 
 
 Q. But still you contributed to it ? 
 
 A. I have already so answered. 
 
 Q. You subsequently contributed to the other side ? 
 
 A. Yes, sir. 
 
 Q. Who called on you on the other side ] 
 A. A friend. 
 
 Q. So you contributed to the other side ? 
 A. I did, sir ; my heart was in the other side. 
 Q. Did Smythe permit this tax being levied ? 
 A. He did not authorize it. 
 
 Q. Who was this man Johnson who called on you ? 
 A. He was a clerk, and is now a clerk. 
 Q. What is his position ? 
 
 A. Chief clerk in Mr. Mason's division — the seventh division, I think. 
 Q. How long has he been in office ? 
 A. He is an old employe. 
 
 Q. Who is Simon Stevens ? Do you know him ? 
 
 A. I know to whom you allude ; I think he had formerly the general order 
 business under Mr. Barney. 
 
 Q. Did you ever have any conversation with him in reference to the sale of 
 the cartage or lighterage business ? 
 
 A. It is possible I may have had, but I never gave him any information ; 
 I did not admire his course in reference to Mr. Barney. 
 
 Q. Do you know whether Thomson has an interest in the storage business 
 under the present arrangement with Myers & Smith ? 
 
 A. I cannot say. 
 
 Q. Is Thomson still occupying his confidential relations with Mr. Smythe ? 
 
 A. I don't know, sir ; when Smythe has any special matters he calls him in. 
 Thomson does not call to see me. I don't think I have seen him in the col- 
 lector's office for the last three months. 
 
 Q. Do you know anything of the sale or letting out of the cartage business ? 
 
 A. Bids were made. 
 
 Q. Were they invited by the collector ? 
 
 A. I cannot be certain ; my impression is I suggested to them to make bids 
 in writing. 
 
 Q. Why is it that propositions to buy this business were made ? 
 A. That I cannot say. 
 
 Q. Do you know whether it was understood such propositions were enter- 
 tained ] 
 
 A. I suppose it was so understood or they would not be made. 
 Q. Do you know whether they were made ? 
 
 A. Mr. Thomson was very industrious in regard to that matter, and gave it 
 out they would be entertained. 
 
 Q. Do you know whether either the cartage or lighterage, or both, were sold ? 
 A. I do not know, except that this very morning, coming down in the cars, 
 H. Rep. Com. 30 5 
 
6f) NEW YORK CUSTOM-HOUSE. 
 
 a gentleman said to mo that the party who had the cartage busmen had died ; 
 this is all the knowledge I have of it. 
 
 Q. You don't know then who had the cartage ? 
 
 A. Except what I heard this morning, that the widow of the man that died 
 and the surviving partner would carry it on. 
 Q. Do you know what they paid ? 
 A. I do not, sir. 
 
 Q. Is it your impression they did pay for it ? 
 
 A. In reference to the cartage I have never heard a word said. 
 
 Q. Who has contracted for the lighterage ? 
 
 A. That I don't know. 
 
 Q. In this general order business, is there any contract made ? 
 A. I have no idea. 
 
 Q. Are not the prices charged in this general order business regulated by 
 law? 
 
 A. Yes. 
 
 Q. What is the law 1 
 
 A. I don't know ; it is not under my supervision. 
 
 Q. Are the rates established by the Chamber of Commerce I 
 
 A. Yes, sir, 
 
 Q. Does not the law say the charges shall not exceed the charges at the port ? 
 A. I think it does ; 1 have never looked particularly to it. 
 
 New York, Tuesday, December IS, 1866. 
 HENRY E. SMYTIIE sworn and examined. 
 
 By Mr. BBOOMALL : 
 Q. What is your official position ? 
 A. I am collector of the port of New York. 
 
 Q. Do you designate the warehouses in which are stored the unclaimed or 
 general order goods ] 
 A. No, sir. 
 Q. You do not I 
 A. No, sir. 
 
 Q. Who were the proprietors of the general order stores when your official 
 duties began ? 
 A. Bixby & Co. 
 Q. None others ? 
 
 A. There were others — Squires & Co. 
 Q. And Frank Squires ? 
 
 A. I do not know. There was a sort of " ring " there. I cannot teach you 
 anything about that business. It always belonged to a " ring," in which there 
 were different interests, and was represented by Squires & Co., Bixby & Co., 
 and others. 
 
 Q. Do you recollect a conversation you had with Mr. Humphrey, late member 
 of Congress, in relation to giving the general order business to Van Bergen 
 & Co.? 
 
 A. Yes, sir. 
 
 Q. Did you tell him you had made arrangements ? 
 
 A. I told him the arrangement was in the course of being made. 
 
 Q. Who were the members of that firm ? 
 
 A, Yan Bergen was one ; and I proposed to divide the business into three 
 or four parts. Van Bergen to have one, Thomson another, and I proposed to 
 divide the rest between some persons to whom I was under obligation. 
 
NEW YORK CCSTOM-HOUSE. 
 
 67 
 
 Q. Will you name those other persons ? 
 
 A. I would rather not, because they were not cognizant of the fact them- 
 selves, and the arrangement was never carried into effect. 
 Q. Were they residents of New York ? 
 A. No. 
 
 Q. Of Washington? 
 
 A. No, nor of Washington. They were neither residents of New York nor 
 of Washington. I do not want to be mysterious, but I will tell you I thought 
 the arrangement was a commendable one, and I thought to carry it out. 
 
 Q. Was any member of the firm of Van Bergen & Correlated to you by 
 affinity or consanguinity ? 
 
 A. No, sir. 
 
 Q. To your wife ? 
 
 A. Mr. Van Bergen married my wife's cousin ; but that had nothing to do 
 with it. 
 
 Q. Who is George F. Thomson ? 
 
 A. He was a fellow-clerk of mine, and who first extended a hand to me. He 
 has been more recently connected with the storage business. 
 Q. Is he connected with it still ? 
 A. Yes, sir. 
 
 Q. Was he formerly an editor of the Daily News ? 
 A. I heard he was. I lost sight of him in those days. 
 Q. The paper known as Ben. Wood's ? 
 
 A. I was informed Ben. Wood had nothing to do with it when he had. 
 
 Q. What was the character of the paper when he was connected with it? 
 
 A. I don't know ; I was in Europe those days, and lost sight of Thomson. 
 
 Q. Do you know whether Thomson himself was arrested at any time during 
 the war for disloyalty ? 
 
 A. He has told me so. There has been rather a renewal of my acquaintance 
 with him, as it lrad ceased for some years, and was not renewed until I got into 
 office. He told me, rather by way of an incident, that he was arrested and 
 taken to Washington, and as soon as Stanton knew the circumstances of the case 
 he was discharged, wit!) rather an apology; and to my knowledge Mr. Stanton 
 has extended civility to him ; so I overlooked all that matter. 
 
 Q. Was Thomson at any time in negotiation with Humphrey & Co.? 
 
 A. Yes, sir. 
 
 Q. At your suggestion ? 
 
 A. The probability is I might have suggested it. I must say, however, I 
 had no arrangement with Mr. Thomson whatever, to my regret. 
 
 Q. Was Humphrey <fc Co. trying to get the general order business ? 
 
 A. If they were not trying to get it from me, they were trying to prevent any 
 one else getting it. 
 
 Q. Did you afterwards make an arrangement, which subsequently failed, 
 with Miller & Conger? 
 A. I did. 
 
 Q. Will you state what led to the arrangement of the whole matter, from 
 your first interview with Miller ? 
 
 A. My first interview with Miller & Conger was : They came and said they 
 would give me a round sum for the business, and take it off my hands ; and 
 their proposition was forty thousand dollars, which I said I would accept. Be- 
 fore I consummated the arrangement with Miller & Conger, they found some 
 difficulties in regard to the procuring stores, and reported to me they did not 
 care to carry it out. I took note of it, and having no interest in it, I was glad, 
 to abandon the matter. 
 
 Q. You say you had no interest in th§ forty thousand dollars ? 
 
 A. No, sir. 
 
68 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. To whom was that to go? 
 
 A. I intended to have it result to the parties who arranged for the business — 
 Van Bergen \; Co. J did not commit myself* to any of theN parties. 
 
 Q. Will you state the names of those to whom the forty thousand dollars 
 was to come ? 
 
 A. Van Bergen & Co. were one of the parties. 
 
 Q. How much to Van Bergen & Co. ? 
 
 A. I had not made up my mind. 
 
 Q. Who were the other persons 1 
 
 A. I decline to tall now. 
 
 Q. I would rather have the names of these parties now. You have named 
 two. 
 
 A. I decline to give the other names. It was an idea of my own w hich I 
 proposed to carry out. 1 organized an arrangement with two persons whom I 
 thought competent to carry out the business under my direction, and 1 made up 
 my mind that I would give a portion of this business to two parties to whom I 
 was under obligation. They were ignorant of the fact, and inasmuch as I 
 never exchanged a word with them or realized a dollar from the business, nor 
 did they, I do not think I could consistently give the names. 
 
 Q. Was Humphrey himself one who was to receive a part of it ? 
 
 A. I told Humphrey, in the course of conversation, if the thing resulted 
 as I would have it 1 would give him something. 
 
 Q Was any sum named ? 
 
 A. No, sir. 
 
 Q. Three thousand dollars ? 
 
 A. No, sir. That might have been named, but I did not feel myself com- 
 mitted to him. 
 
 Q. Was he satisfied to receive this proportion ? 
 
 A. I understood he was. When he came to me I did not know he was a 
 partner of Bixby. He said it was rather a hard case for him. I said, " These 
 men are undertaking to defeat my plans ; I promise you when these things are 
 fixed I shall give you something, and if you are a partner of Bixby & Co. I 
 feel different to you from what 1 do towards them." I said, " How much is it 
 worth to you ?" I think he said three thousand dollars. I said, if I consummate 
 my plan I will see you. 
 
 Q. Do you recollect was Van Bergen &c Co. to receive ten thousand dollars ? 
 
 A. There was no sum fixed. 
 
 Q. Was any portion of this sum to be reserved by you for political purposes ? 
 
 A. I do not know, but it might have been. If I had been called upon as I have 
 often been I would have taken it out of that ** stealing fund ;" as it is a matter 
 of plunder. I think I should have dipped into that pile. 
 
 Q. For what political purpose ? 
 
 A. For such political purposes as I might see fit to contribute to. 
 
 Q. Had you any such demands made upon you ? 
 
 A. Several. 
 
 Q. To what amount ? 
 
 A. I have paid out from three to five thousand dollars since I have been in 
 office. 
 
 Q. To whom? 
 
 A. To different parties. 
 
 Q. Name those that received the largest amounts. 
 
 A. I contributed towards the elections in the State of New York out of my 
 own pocket, and not from any fund. 
 Q. How much did you contribute ? 
 A. From two to three thousand dollars. 
 
NEW YORK CUSTOM-HOUSE. 
 
 69 
 
 Q. Will you state whether Senator Doolittle was to receive any part of this 
 money ? 
 
 A. I did intend to give his son an interest in it. 
 Q. His son holds an appointment under you? 
 A. Yes, sir. 
 
 Q. How much was he to have 1 
 A. I don't know. 
 
 Q. Did you have any conversation with him or his father about it ? 
 
 A. No, sir ; I had a conversation with him after the matter was abandoned 
 
 Q. Was Senator Patterson to have any part of it ? 
 
 A. Not that he knows of. 
 
 Q. Was he to have any part of it ] 
 
 A. I don't know but he might. 
 
 Q. Did you intend to give him any part of it % 
 
 A. I did intend to give him some. 
 
 Q. You decline to give the names of the other parties who were to have a 
 share of it ? 
 
 A. I think you have ascertained very well. 
 Q. Do you know Simon Stevens 1 
 A. I do. 
 
 Q. Who is he, or where does he live 1 
 
 A. I do not know him in any other way than as a friend of Horace Greeley. 
 
 Q. Was he to have any part of it ? 
 
 A. Not so far as I had any direct intention. 
 
 Q. Did you ever offer him any of it ? 
 
 A. No, sir. 
 
 Q. When Miller & Conger were attempting to bond stores, was there any 
 interference with their leasing what are called Getty's stores, on the part of any 
 officers of the government 1 
 
 A. No, sir. 
 
 Q. None at all ? 
 
 A, No, sir, unless I have interfered with it. I was endeavoring to get the 
 government to take Getty's stores at the time, which the government declined 
 to do. After the government declined to take them, Mr. Miller asked me whether 
 there were any objections to their negotiating for it. They did so ; and before 
 they accomplished their negotiation, the government changed its mind and 
 directed me to take them ; which I did. 
 
 Q. While the Miller arrangement was pending did you have an interview 
 with E. 0. Johnson, and did he make you any offer for this business 1 
 
 A. Yes, sir. 
 
 Q. About when? 
 
 A. I do not know. 
 
 Q. Some time in June last ] 
 
 A. I do not remember within a month ; I have no impression on my mind. 
 Q. Did he offer you fifty thousand dollars for the business ? 
 A. He said he would give me more than Miller & Conger did; I told him 
 that was out of the question ; I would not negotiate at all. 
 Q. No'sum was named ? 
 A. Not that I remember. 
 
 Q. Has Johnson the general order business now 1 
 A. No, sir. 
 
 Q. Has he anything to do with it ] 
 
 A. Not that I know of ; not through me. 
 
 Q. Have you met him since that interview in which he offered you more than 
 Miller & Conger ? 
 A. Yes, sir. 
 
70 
 
 NEW YORK CUSTOM -HOI SK. 
 
 Q Do you recollect the conversation that took place at any interview in re- 
 lation to this business ? 
 A. Yes, sir. 
 Q. What was it ? 
 
 A. 1 told him the general order business was at loose-ends, and that I wa- 
 ready to give it to him. He said that matters had changed very much since he 
 made the proposition, and that it was not worth any such sum. I told him to 
 wait until I had asked him something for it ; I would accept nothing from any 
 man, or make it directly or indirectly a bargain. 11.- -aid that on the-.- terms he 
 would take it, and he took the business. 
 
 Q. Has he it still ? 
 
 A. No, sir. I had so many complaints in regard to his scale oi prices I 
 changed him. 
 
 Q. How long did he hold it? 
 A. A month or two. 
 
 Q. Was any arrangement made by which Johnson or anybody for him was 
 to pay a percentage of the proceeds, or in any way t'» pay lor the business? 
 
 A. 1 know I never consented to receive an y thing from him, audi never made 
 any bargain i f this sort directly or indirectly. 
 
 Q. Did you h't him have the whole general order business for nothing? 
 
 A. Yes, sir. The two condition- wen; that In- would not leave the first 
 package of the goods where they were then ; and second, that he would not 
 cause any co nplaint by tin' merchants in regard to tin; way the business was 
 done. When, after that, the merchants complained of the charges, I transferred 
 it to Myers & Smith ; and they have advertised in the papers that they would 
 reduce the charges on the goods under my direction. 
 
 By Mr. Rollins : 
 
 Q. When did Myers & Smith take the business ? 
 A. In November ; the last of November. 
 
 By Mr. Bromall : 
 Q. Who did you say had the business now ? 
 A. Myers & Smith. 
 
 Q. What is the arrangement with them ? 
 
 A. That they shall reduce the charges in every case where the merchants 
 take possession. I will also say, if you will allow me, from the commencement 
 of this business, and in all other duties of my office, I have avoided in every 
 way any bargain or sale, in any way by which I should receive the amount of 
 one dollar. 
 
 Q. Either for yourself or anybody else '< 
 
 A. Y"es, sir ; whatever my intention was in regard to the first part. 
 
 Q. Y'ou say that the government now has Getty's stores ? 
 
 A. Yes, sir. 
 
 Q. At what rent ? 
 
 A. Forty-five thousand dollars. 
 
 Q. Do yon know what rent Miller & Conger were to give ? 
 
 A. I don't know anything about it, except that when the negotiation* with the 
 government was given up they commenced theirs; and before they finished 
 theirs I took the stores for the government. 
 
 Q. Had you not these stores offered to you for a less sum than forty-five 
 thousand dollars ? 
 
 A. Xo. sir : never for any sum less. 
 
 Q. Was that the sum Mr. Getty first asked ? 
 
 A. I do not remember. I think he asked or intimated he wanted more money 
 for it, but that was the lowest sum he named ; and it was after considerable ne- 
 
NEW YORK CUSTOM-HOUSE. 
 
 71 
 
 gotiation with him, and after he named that price, that I could conscientiously 
 recommend it ; which I did by letter, in which I stated that in a business point 
 of view it was vastly for the interest of the government to take Getty's stores, 
 they offering so much more space than we had. 
 
 Q. Is E. C. Johnson alone in this general order business, or is there a com- 
 pany ? 
 
 A. I believe there is a company. 
 
 Q. Can you name the members of the firm ? 
 
 A. I know nothing about them. 
 
 Q. Is Thomson one of them ? 
 
 A. No, sir. 
 
 Q. State what connection Thomson has with the business now. 
 A. None, to my knowledge. 
 
 Q. Have you employed Thomson in any way in connection with the general 
 order business ? 
 A. No, sir. 
 Q. In no way ? 
 A. No, sir. 
 
 Q Do you know whether Miller & Conger now get any portion of this busL 
 ness ? 
 
 A. I do not. 
 
 Q. Do you not know that Johnson has sub-let a portion of it to Miller & 
 Conger, he to receive thirty-five per cent, of the proceeds ? 
 A. I do not know. 
 
 Q. You never heard it from Johnson himself? 
 
 A. No, sir; but my impression is that the business must be under-let, as it is 
 very large. I presume they let it on terms that must be profitable. 
 
 Q. What is your estimate of the gross proceeds of that business ? 
 
 A. I have no -knowledge in any way of it, except in the way offers were 
 made to me for the business. 
 
 Q. You have spoken of some complaints made by merchants ; state whether 
 they were numerous during the time Johnson had the business? 
 
 A. Not numerous ; but occasionally some one would complain of charges 
 being exorbitant. The excessive charge sometimes reached a dollar and a half. 
 I do not recollect it ever being over a few dollars. But it was sufficient for the 
 complaint, and to make me change the arrangement. 
 
 Q. Did you dispose of the business in Brooklyn for $10,000? 
 
 A. No, sir. 
 
 Q. Do you know whether it was done? 
 A. No, sir. 
 
 Q. Is H. B. Claflin in the general order business? 
 
 A. No, sir; I don't think the largest merchant in the United States would 
 meddle with that. 
 
 Q. Was there a proposition made to you at any time whereby the proposer 
 agreed to pay $15,000 to the government, or abate that sum to the merchants? 
 A. I do not recollect any such thing. 
 
 Q. Don't you recollect any such proposition being made by Humphrey & Co. ? 
 A I think they made such a proposition as that, after I had made my ar- 
 rangement. 
 
 Q. You did not accept that proposition ? 
 A. I could not. 
 
 Q. But when that arrangement failed, why did you not accept that proposition ? 
 
 A. Because I would not have anything to do with them on any terms. 
 
 Q. Have you the selecting of the general order stores ? 
 
 A. No, sir. 
 
 Q. In any way ? 
 
72 NEW YORK CUSTOM-HOUSE. 
 
 A. No, sir. I suppose I could if I choose ; if I thought the interest of the 
 government or the merchants should require it. 
 
 Q. Did you ever offer to sell any part of the cartage business or the whole of 
 it to anybody ? 
 
 A. 1 don't know. I never offered to sell it; I may have received offers for it. 
 Q. Did you ever offer to sell it to Mr Mclntyre for 815,000, or any sum ? 
 A. No, sir ; I don't remember. 
 
 Q. Was there a proposition to contract offered by Mclntyre for any sum ? 
 A. No, sir; I don't recollect. 
 
 Q. Do I understand you never made any offer to, or received any offer from 
 other parties ? 
 
 A. No, sir; perhaps I was asked the «juestion from some go-between, but the 
 thing would be dismissed from my mind and it might be construed into some- 
 thing like a negotiation. 
 
 Q. Was there any attempted negotiation about the lighterage business with 
 anybody ? 
 
 A. I should think that Mr. Depen, representing certain parties, made some 
 proposition to take it on certain terms. 1 remember having a conversation with 
 him, but what the proposition was I do not know. I merely turned around and 
 gave the parties the lighterage business. 
 
 Q. Was it for a consideration of any kind ? 
 
 A. Yes, sir ; I did it out of respect for Mr. Depen, who was a prominent can- 
 didate for the collectorship. and I thought he should have something. 
 
 Q. Did confidential relatione exist between you and Mr. Embree for a period 
 of three months after you became collector? 
 
 A. Yes, sir. Mr. Embree was designated by me as a deputy in regard to certain 
 matters. He was my deputy at large. 
 
 Q. And is so still ? 
 
 A. He would be if I had not assigned him his desk again. 
 Q. He was your agent ? 
 A. No, sir ; I had no agent. 
 Q. What did you call him ? 
 A. Deputy at large. 
 
 Q. Did you ever refer applications for the cartage and lighterage to Embree 
 for terms and conditions ? 
 
 A. Not for terms and conditions. I referred them to him to get rid of them. 
 
 Q. Do you know whether he drew his salary from. the government for the 
 four months preceding August last ? 
 
 A. He always draws his salary from the government. 
 
 Q. W^hat is his salary 1 
 
 A. Twenty-five hundred dollars a year ; raised to three thousand, with all 
 other deputies, to $3,000. 
 
 Q. Do you know whether he was engaged in any business during these four 
 months other than in the negotiation for the lighterage, &C. 1 ? 
 
 A. He was attending to the duties of his office. He was not negotiating ex- 
 cept as these people might apply for it, and he saved me the trouble of listening 
 to their propositions ; none of which were ever entertained. 
 
 Q. Did you ever direct inspectors of customs to pass baggage of persons ar- 
 riving from foreign ports ? 
 
 A. No, sir. 
 
 Q. Do you know of its having been done by any persons under you ? 
 A. No, sir. 
 
 Q. Do you remember telling Thurlow Weed you had sold the general order 
 business ? 
 A. Y^es, sir. 
 
 Q. Did you tell him what you sold it for ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 73 
 
 A. I told him of the arrangement I had made with Miller & Conger. 
 Q. Did you tell him the amount of the sum ? 
 A. I don't think I did. 
 
 Q. Had you ever any conversation with Senator Doolittle about this arrange- 
 ment with Miller & Conger, or about any other arrangement for the sale of the 
 storage and cartage or lighterage business ? 
 
 A. I don't rightly remember having had any. 
 
 Q. Do you remember a conversation in which you told him you would give 
 his son a part of it ? 
 
 A. No, sir ; I don't remember having given any particulars to Senator Doolittle 
 at all. I recollect telling him I intended doing something for his son. 
 
 Q. Did you ever have a conversation with Senator Patterson on the same 
 subject 1 
 
 A. No, sir. 
 
 Q. No conversation of any kind ? 
 A. No, sir. 
 
 Q. Nothing was mentioned to him of the arrangement made or being made 
 with Miller & Conger ? 
 
 A. Not that I am aware of. 
 
 Q. Have you ever paid, or presented, or loaned to Senator Doolittle, or his 
 son, or to Senator Patterson, or any of them, any money or other property of 
 any kind arising out of your business here ? 
 
 A. No, sir. 
 
 Q. Do you know whether any person interested in any part of the business 
 has done so ? 
 
 A. I know they have not, In connection with that question let me state, I 
 mean when I take an oath to give you the truth. Nothing has passed through 
 my hands, directly or indirectly, from the general orders. 
 
 Q. Not for political purposes ? 
 
 A. No, sir ; not one cent. I suppose that is expressive. 
 Q. Who authorized Edward Atkins & Co. to collect from, or assess the trans- 
 fer carmen twenty per cent., or any other percentage, of their receipts ? 
 A. No one that I am aware of. 
 Q. Do you know whether it has been done? 
 A. No, sir. 
 
 Q. Did you have any conversation with President Johnson about helping 
 any members of his family ? 
 
 A. No, s'r. If I had I would be certain of incurring his displeasure. 
 Q. Nor with his son? 
 A. No, sir. 
 
 Q. Nor with any member of his family ? 
 A. No, sir;, most certainly not. 
 
 Q Do you know whether anybody connected with you in this business had 
 such conversation ? 
 
 A. There is nobody connected with me in this business. 
 Q. I mean under you. 
 
 A. No, sir. I have never authorized anybody under me to talk with any- 
 body — I mean, to negotiate with them. 
 
 Q. Do you remember a certain woman calling on you with a letter from Presi- 
 dent Johnson? 
 
 A. I do. 
 
 Q. Have you got that letter? 
 
 A. It was a simple application from some parties — Barr, Phelps & Co. — for 
 the general order business. She stated she had an interest with them. 
 Q. She brought a letter from the President ? 
 
 A. She brought no letter. Barr, Phelps & Co. brought the application and 
 
74 
 
 NEW YORK CUSTOM-HOUSE. 
 
 stated their interest ffafl represented by the name of ]Yn v. On the back of 
 their application the President wrote, as he often does, which was the only 
 application I ever had from him, "If the collector can consistently comply witli 
 the application) he will oblige," &c. 
 
 Q. Do you know the name of tlii- woman? 
 
 A. Yes, sir; Perry. After Barr, Phelps & Co. came to me and I had told 
 them they could not have it, this woman, Pery, came and said she was the 
 person represented by the name of Perry. 
 
 Q. Do I understand you to say she brought no letter from the President? 
 
 A. She did not. 
 
 Q. Did she make any demand on you for money? 
 
 A. She urged me strongly to give her an interest in the general order busi- 
 ness. She pressed her application as interested with Barr tV 1'h lps. 
 Q. Do you know where she lives? 
 A. In Cincinnati. 
 Q. Do you know her business ? 
 A. No, sir. 
 
 Q. Did you pay her any money? 
 
 A. No, sir. 
 
 Q. At any time ( 
 
 A. I have loaned her some. 
 
 Q. How much ? 
 
 A. One hundred dollars first. 
 
 Q. As much as five hundred dollars altogether? 
 
 A. I should think so. 
 
 Q. How came you to loan this money to a woman you did not know much of? 
 
 A. Have I not some private arrangements that are free from investigation? 
 This woman was rather a pressing woman. She bothered me a good deal to 
 get this business for Barr & Phelps. I told her it was out of the question; She 
 said she had been in Washington under some expense, aud I gave her a hun- 
 dred dollars to get rid of her. She wrote me since, and I gave her three hun- 
 dred more. I gave it to her out of sympathy ; and if her story was true, her's 
 was a hard case. Her husband was killed in the war, and she was left without 
 means. It was one of those cases that if she came along again to-day I would 
 give her more. I have never received any consideration for the money. 
 
 Q. Now, Mr. Smythe, you have, during the time you have been in office, made 
 a considerable number of removals and appointments? 
 
 A. Y^es, sir. 
 
 Q. State whether you made these changes upon your own judgment, or 
 whether you were directed from any quarter to make them. 
 
 A. Entirely on my own judgment. I have never had a direction from Wash- 
 ington to remove a person, or to appoint one. I asked the President, when I got 
 the position, for my instructions in that way, and he said, " Remove incompe- 
 tent people, and put in competent ones." That was the only order ever given 
 me. 
 
 Q. In removing and appointing, had you regard to the politics of the parties ? 
 
 A. Very little. If a man denounced the administration, or if he was a cop- 
 perhead, I would hoist him. There are people there now of all shades of poli- 
 tics ; and I have gone further than that. I told them they need not fear in re- 
 gard to their peculiar political opinions. 
 
 Q. Have you an appointee of the name of Farnum ? 
 
 A. I don't know. 
 
 Q. Do you know whether you have any man as an appointee who was a 
 former slave-trader ? 
 
 A. I know I have not. There was something of that kind mentioned in a 
 paper, and I investigated it and found it all bosh. 
 
NEW YORK CUSTOM-HOUSE. 
 
 75 
 
 Q. There is a steamer, the Cayuga, about which they make some charge. Is 
 she under your charge ? 
 
 A. There is a steam revenue cutter of that name. 
 Q. What use are you making of her ? 
 
 A. Trying to sell her now. We tried to get rid of her by auction two or 
 three times. As she is cumbersome and expensive, the government would like 
 to dispose of her and get vessels of less expense. We did sell her the other 
 day, but the party failed to respond. 
 
 Q. Have you made any use of that steamer for your own private purposes ? 
 
 A. I am sorry to say I did go with the yachts last summer on their cruise, 
 but I got back as quick as I could. I got off her as quick as I could. 
 
 Q. That was the only instance 1 ? 
 
 A. Yes, sir; she was going to make her usual cruise up the sound, and on that 
 occasion I wanted to go up the sound also. I intended to go in her, but went 
 in one of the yachts. 
 
 Q. Have you heard complaints from the merchants since the last change was 
 made in the storage business ? 
 
 A. No, sir. 
 
 Q. None ? 
 
 A. None. 
 
 Q. That change was made the last of November ? 
 A. Yes, sir; and I have heard no complaints since. 
 Q . How are these charges regulated ? 
 
 A. I really don't know. They state to me the charges are about the same 
 they were ten years ago. They are very little more, and labor costs about 
 three times as much now. They make a very good case of their own, and say 
 the rates are not as high in proportion as the advance in labor, &c. If there 
 are any drippings or margin in the business at all, I intend it shall be all con- 
 sumed in reducing the charges. 
 
 Q. Who applied to you to give. this business to Johnson? 
 
 A. Johnson himself. 
 
 Q. Nobody else ? 
 
 A. Thomson may have mentioned his name, but I did not remember it until 
 I came in contact with Mr. Johnson. 
 
 By Mr. Rollins : 
 Q. You say Mr. Thomson recommended him ? 
 A. I don't remember. These things are not very important. 
 
 By Mr. Broomall : 
 Q. Did any one in Washington recommend Johnson? 
 
 A. Never ; I never had any word to say with officials in Washington in any of 
 my arrangements, except what I had with Humphrey, as a member of the firm 
 of Bixby & Co. 
 
 By the Chairman : 
 
 Q. How old is Mr. Doolittle's son ; do you know him personally 1 ? 
 A. Yes, sir; I know him since I have appointed him. He is not far from 
 thirty. 
 
 Q. What capacity is he employed in? 
 A. He is a weigher. 
 Q. How does he discharge his duties? 
 . A - # 1 have never heard but one complaint, and then 1 sent for him and told 
 him if I heard another I would discharge him. 
 Q. What is his salary? 
 A. $2,500 a year. 
 
76 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Are there perquisites? 
 
 A. I do not know. I have been told there are some percent i^-es. 
 
 Q. Was this, the only complaint made about him, a small one/ 
 
 A. Yes, sir. After hearing it I asked one of the weighers, irho told me he 
 had seen him under the influence of liquor. I wrote to his father and told him. 
 He wrote back to me he was very sorry, and if his son was wrong in any way 
 not to retain him an hour 
 
 Q. Have you had any conversation with Messrs. Patterson or Doolittle in 
 which it was stated that anything directly or indirec tly would inure to their 
 benefit in this arrangement 1 
 
 A. Not even in tin* slightest way. They are people who would feed insulted 
 and would resent it. I would not think of doing it. I think this report in re- 
 gard to them emanated from a mischievous old devil I removed lor inefficiency ; 
 he was a former member of Congress, and his name is Shankland. 
 
 Q. What is the amount of your salary ? 
 
 A. About SG.OOO, with the tax paid. 
 
 Q. Is that all the office is worth to you ? 
 
 A. No; since I have heen in office 1 think I have received from seizures in 
 six months from ten to twelve thousand dollars. 
 
 Q. Do you know Mr. Farwell the special agent of. the treasury? 
 A. I do. 
 
 Q. Were there any seizures made at his suggestion ? 
 A. There were. 
 
 Q. What was the character of them? 
 
 A. Some of wines, and some of dry goods. 
 
 Q. Have the wine seizures been settled by compromise? 
 
 A. Yes, sir; one case. 
 
 Q. What did it amount to? 
 
 A. I think it realized $35,000. 
 
 Q. What interest had the government in that ? 
 
 A. Half; and the informer one-quarter. 
 
 Q. Who was the informer in that case? 
 
 A. Farwell. The remaining one-fourth — after the government and informer 
 are paid — is divided between the naval officer, surveyor, and myself. 
 
 Q. Who fixed the amount that these importing wine houses should pay? 
 
 A. I did; with the advice and concurrence of the district attorney, naval 
 officer, and surveyor. 
 
 Q. Were there other seizures made in the district? 
 
 A. Yes, sir. 
 
 Q. What disposition was made of their cases? 
 A. They are in course of adjustment now. 
 Q. To be litigated or adjusted? 
 A To be litigated. 
 
 Q. What is the character of the other seizures besides wines ? 
 A. Silks, ribbons, &c. 
 Q. How many cases? 
 A. Three or four. 
 
 Q. What is the present status of these cases? 
 
 A. They will be litigated. In my opinion there are no frauds in the cases. 
 Q. Were the books and papers and stores seized? 
 A. In some cases. 
 
 Q. Are they held now or are bonds given ? 
 
 A. Bonds are given. These goods were seized in consequence of being in- 
 voiced at rather a lower rate than they were offered to Mr. Farwell for, who went 
 to buy them under a disguised name. 
 
NEW YORK CUSTOM-HOUSE. 
 
 '11 
 
 By Mr. Rollins : 
 Q. What were these wines seized for, undervaluation 1 
 A. Yes, sir. 
 
 Q. How much was the undervaluation ? 
 
 A. From twenty to thirty per cent., I suppose. 
 
 Q. What was the amount of the wines 1 What was their value % 
 
 A. Something like fifty thousand dollars. 
 
 Q. What was the penalty for the undervaluation of the whole % 
 
 A. Fifty thousand dollars. 
 
 Q. The full value of the wine 1 
 
 A. Yes, sir. 
 
 Q. If that had been settled strictly in accordance with law, what would have 
 been the share of the government, supposing there had been no compromise made ? 
 A. It Avould depend on what we could get. 
 
 Q. Suppose there was really an undervaluation, and the thing was adjusted 
 strictly in accordance with law, what would the government have received in 
 that case ? 
 
 A. If the wine had retained its qualities it would receive more ; if not, less. 
 Q. Would not the government have received upwards of $50,000 1 
 A. No, sir. 
 
 Q. What would have been the legal penalty ? 
 
 A. If the wine had remained unimpaired the government would receive the 
 : ? ull value for it. 
 
 Q. What would Mr. Farwell have received ] 
 
 A. One-quarter the amount of whatever received. 
 
 By Mr. Broom all : 
 
 Q. Does not the law require the Secretary of the Treasury to assent to this 
 ( ompromise ? 
 
 A. Xo, sir ; it requires the consent of the district attorney. 
 Q. In any of these compromises has the Secretary of the Treasury been con- 
 sulted 1 
 
 A. I could not tell you without looking at the correspondence. 
 
 Q. Was the matter submitted to him after this compromise was made ? 
 
 A. Yes, sir. 
 
 By Mr. Rollins : 
 Q. What is the duty on those wines ? 
 
 A. It is a complicated one. I can give you the tariff if you want it. 
 Q. Suppose the government had collected the actual duty on the real value 
 of the wines, what then would the government have received ? 
 A. Less than they did. 
 Q. Less than halt of what they did 1 
 A. Yes. 
 
 Q. Have you the papers in the case that was settled ? 
 A. Yes. 
 
 January 12, 1SG7. 
 
 HENRY E. SMYTHE recalled and examined : 
 By the Chairman ; 
 
 Q. Have you not removed the widow of a soldier from her place in the cus- 
 tom-house because of a quarrel with her uncle ? 
 
 A. No ; it was not in consequence of that, but because of her unfituess for 
 the place. 
 
78 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Was there, a Mr. Wheeler appointed by Mr. Wakeman and removed bv 
 you, but afterwards reappointed when charge.- against him for selling stamps 
 were not cleared up ? 
 
 A. I did remove Mr. Wheeler, but restored him, being satisfied thai the eha.-ge- 
 were entirely groundless. The charge was first made agftinsl bim in the DOSl 
 office, but he brought me sat isfactory proof from the postmaster which completely 
 exonerated him. 
 
 Ni;\\ YditK, January 15, 18G7. 
 EDWARD R. PHELPS sworn and examined. 
 
 By the Chairman : 
 
 Q. Did you have any negotiation in reference to the general order business, 
 before or after Mr. Smyth. • became collector? 
 A. Yes. 
 
 Q. State with whom. 
 
 A. Myself and Thomas .1. Parr, of Xew York, decided on applying to the 
 President, through a Mrs. Perry, of Cincinnati, for the general order business 
 from pier 59 North river to the Battery. 
 
 Q. Did you meet her at the President's house? 
 
 A. I did meet her there, ,-everal times in the months of February and March. 
 We went there at one tine- <>n an appointment made by the President. He re- 
 quested us to call there at six p. in., and that he would sec ai alone. We went 
 and had an interview with him, and he assured me that Phelps & Barr should 
 have the general order business as above stated — they bringing proper testi- 
 monials. He remarked that he gave this to Barr & Phelps as much for the 
 benefit of Mrs. Perry as for their benefit, as he wished to help her. lie said 
 "I suppose you will make it all right with Mrs Perry." I then went on to 
 state the arrangement, but In; said " never mind, you need not tell me about that." 
 
 Q. Was it not then determined what the portion was that she should receive 
 out of this business I 
 
 A. Yes ; she told Mr. Johnson the interest she was to have ; and he replied 
 that he was satisfied if she was. 
 
 Q. What was the portion she was to have? 
 
 A. She was to have one-third of the net profits, aud she had a writing to that 
 effect from us. 
 
 Q. What else occurred at the interview ? 
 
 A. I said to the President, " There will be a great deal of contention among 
 the New Y'ork politicians, who will try to get it themselves " He patted me on 
 the shoulder and said, "Never mind, my man, I will stand by you." He then 
 remarked to Mrs. Perry, " This will be all right." We left the matter in Mrs. 
 Perry's hands. She was to inform us when we should call again on the Presi- 
 dent. She sent me word to come again to Washington, shortly before Mr. 
 Smythe was appointed collector, and we went again and called upon the Presi- 
 dent and had an interview with him and Mrs. Perry. He called his private sec- 
 retary — Colonel Browning, I think his name is — and he told me to state to him 
 what I wanted, and that he would write it down. I then told him what I 
 wanted, and he wrote to the collector to give the general order business of 
 the North river from pier 59 to the Battery to Edward R. Phelps and 
 Thomas J. Barr, of New York, The President was present while he wrote this 
 letter, and was talking in a low tone to Mrs. Perry ; and when it was written the 
 President signed it. I think I can produce that letter. I came back to New 
 York with that letter, and as soon as Mr. Smythe was confirmed as collector I 
 presented the letter to him. He appeared to be very much confused, and put 
 
NEW YORK CUSTOM-HOXTSE. 
 
 79 
 
 up his Land to his head and thought for a moment, and then he remarked that 
 the general order business was all disposed of. He said, " It is very strange 
 that the President never told me to reserve this for his friends." He also re- 
 marked that he had to agree to give a portion of the general order business to 
 Senator Doolittle's son, and a portion to Senator Patterson, the President's son- 
 in-law, and a portion to another person, I cannot say whom, before he would be 
 confirmed. He then said he did not have a chance to save only a small por- 
 tion of it for himself. And he asked us if we would take one-fourth interest 
 in the business ; that perhaps he could let us have that much. We felt confi- 
 dent that we could get what we wanted through the President, and so we de- 
 clined to take his offer. He then asked us to wait until the middle of the week. 
 In the mean time Colonel Cooper, one of the President's secretaries, came on 
 from Washington and had an interview with the collector. And when we called 
 next on Mr. Smythe he told us the general order business was all disposed of. 
 We then abandoned any further idea of it. 
 
 New York, Tuesday, December 18, 1866. 
 THOMAS J. BARE, sworn and examined. 
 
 By Mr. Broomall : 
 Q. You are of the firm of Phelps & Barr ? 
 
 A. There is no such firm existing; we were associated together in regard to 
 the general order business ; that was all. 
 
 Q. Had you any interview with Mr. Smythe himself ? 
 A. Yes, sir ; I had two interviews with him. 
 
 Q. Will you state whether you made, or he entertained, any proposition for 
 the purchase of the general order business ? 
 
 A. When we went to him we had a letter from the President to him, recom- 
 mending us to have the general order business from the Battery to Fifty-ninth 
 street, North river. He said it was given out, except a portion he had reserved 
 for himself. 
 
 Q. Can you give us the date of this application ? 
 
 A. I could not now ; it was within two weeks after he was confirmed as col- 
 lector — I think, the same week he came back from Washington ; it was within 
 three days after he came back. 
 
 Q. Do you know whether it was before, or after, his negotiation with Miller 
 & Conger ] 
 
 A I do not know whether it was before, or after, but it must have been after, 
 for he said it was all given out. 
 
 Q. Were you offering money for the business ? 
 A. No, sir ? 
 
 Q. Was anything said by him about money being necessary for the purpose ? 
 
 A. He would not talk much about the North river side, but he said he had 
 been offered a certain amount of money for the East river side. He told me the 
 amount he was offered, but I cannot remember what it was now. He said he 
 might probably give us a portion of the East river side. We took it for granted 
 that if we offered a little more than what he said he had been offered we could 
 have got all the East river side. 
 
 Q. Did he tell you for what amount the North river side had been disposed of? 
 
 A. He did not ; but he said, " You know, gentlemen, the North river general 
 order business is the big plum for the collector." That was the expression used. 
 
 Q. Do you know whether that business had been sold under previous col- 
 lectors ? 
 
 A. I do not ; only from hearsay. 
 
80 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Do yon know a female by the num.- of Mrs. Perry ? 
 
 A. Yes, I know her to this extent, that Mr. Phelps introduced her to me as 
 a familiar acquaintance of the President, and one who had influence with him, 
 which she could use to induce him to give us this general order business. 
 
 Q. Did you make any arrangement with her? 
 
 A. She was to have one-third of the profits of the business if we got it. 
 Q; Was there a written agreement to that effect ? 
 A. There was. 
 
 Q. You did not know her before Mr. Phelps introduced her to you ? 
 A No; I never saw her but three times altogether, once in Washington and 
 twice here. 
 
 Q. What proof did she exhibit to you to satisfy you she had influence with 
 the President 1 
 
 A. I think she showed me a letter, but I am not sure whether it was then or 
 afterwards. 
 
 Q. Did she show you at one time a letter from the President ? 
 
 A. I would not like to say positively she did. but my impression is that sin: 
 did. I WOllld like to think this matter over before giving a positive? answer. 
 She showed me some letters and papers, and 1 think she showed me a letter 
 from the President. 
 
 Q. Do you know where she lives } 
 
 A. I think she lives in Cincinnati. 
 
 Q. You were kO give her one-third of the profits? 
 
 A. Mr. Phelps made the bargain with her in Washington. I was present 
 after they came back, when the matter was all talked over again. 
 
 Q. She was to get you the business and then to have one-third of the profits ? 
 A. Yes, sir. 
 
 Q. Do you know anything of this woman since? 
 
 A. I do not. After we had presented the recommendation which the Presi- 
 dent gave us to Mr. Smythe and had been treated so cavalierly by him, we 
 wrote to Mrs. Perry that if she did not get a more imperative letter from the 
 President than the one she sent, we could not do anything with Mr. Smythe. 
 It appears the President then said to her, when she again saw him, that he had 
 done all he could for her. She then came on here and saw Mr. Smythe, and I 
 think there was some arrangement made be^weeu them. She told us Smythe 
 said she should drop the two gentlemen who were connected with her. 
 
 Q. Then the letter she exhibited to you was not that letter? 
 
 A. No. 
 
 Q. Do you recollect the contents of that letter ? 
 
 A. The letter was written by Mr. Raymond, recommending Mr. Phelps for 
 some position, and it was also signed by several other congressmen, and the 
 President indorsed it. 
 
 Q. Was the letter she showed you such a one as to impress you with the 
 opinion that she had influence with the President? 
 
 A. I believed she had influence with the President, but I cannot say what 
 made me think so ; whether it was from her own conversation or from a letter 
 she showed me I cannot say. Mr. Phelps had all the negotiation with her in 
 this matter. Mr. Smythe told me at the first interview I had with him that he 
 had to give away part of the North river storage business to get confirmed. 
 His words were, he had to provide for parties in Washington in order to get 
 confirmed, 
 
 Q. Did he name any of the parties ? 
 
 A. He did. 
 
 Q. Tell us who he named. 
 
 A. He said a portion of it was to be given to Senator Doolittle's son. 
 
 Q. Did he mention any other persons ? 
 
 A. No ; if he did I cannot recollect them now. 
 
NEW YORK CUSTOM-HOUSE. 
 
 81 
 
 Witness put in copies of the following letters, originals of which were, he 
 thought, with Collector Smythe : 
 
 "New York, January 25, 1S66. 
 "Respected and Dear Sir : We beg leave to make application to have 
 our warehouses designated as the general order warehouses, to receive un- 
 claimed goods from vessels discharging at this port and lying at the wharves 
 on the North river side of the city, from the Battery to pier No. 59, under the 
 same rules and regulations that now exist in relation to such special warehouses. 
 
 "THOS. J. BARR. 
 "EDWARD R. PHELPS. 
 
 "His Excellency Andrew Johnson, 
 
 " President of the United States." 
 
 "Washington, D. C, January 25, 1S66. 
 " Mr. E. R. Phelps being highly recommended by the Hon. Henry J. Ray- 
 mond and other representatives from the State of New York, I shall be glad if 
 the general order warehouse business from the Battery to pier No. 59, on the 
 North river, can, consistently with the interests of the government* be given 
 to Messrs. Thomas J. Barr and Edward R. Phelps. 
 
 "ANDREW JOHNSON/' 
 
 " I have already favorably indorsed the application of Edward R. Phelps and 
 Thomas J. Barr for the general order business from the Battery to pier No. 59, 
 on the North river, New York city. I hope they may receive the appointment 
 from the collector of customs. 
 
 "ANDREW JOHNSON." 
 
 Mr. Barr being requested to give the committee his opinion of the general 
 order business, made the following statement ; 
 
 The practice has heretofore been for the collector to assign the general order 
 business to certain persons, allowing them to locate the warehouses for the re- 
 ception of the goods at such points as they might see fit to locate them at with- 
 out regard to the interests of the public. My suggestion is, that those ware- 
 houses should be loca'ed, by authority from the governmait, at points on both 
 rivers that would be most conducive to the interests of the public at large. The 
 present warehouse for the North river goods is, I am informed, at the corner of 
 Bank street and Eleventh avenue. Goods that are landed at the foot of Fulton 
 street must be trucked, I think, two miles uptown to this place, and when 
 wanted by the importers, nine-tenths of whom live down town, have to be 
 brought back the same distance ; and the four or five additional cartage rates 
 they have lo pav are not the only annoyance the merchants are subjected to by 
 this arrangement, but they also run the risk of having their goods injured by 
 the weather during their transit. This is wrong ; and if the collector fails to 
 make such changes as are required to correct it, Congress should take the matter 
 int > its own hands. It is nor the charges for warehousing alone that cause this 
 general dissatisfaction, but it, is the manner in which the business is conducted. 
 For instance, there is some difficulty in regard to the marks on some packages 
 of goods, and, instead of having the warehouse convenient to the merchant, he 
 is obliged to go miles out of his way to have them corrected, when it could be 
 done within half a mile of his store if the warehouse was situated where -it 
 ought to be. 
 
 A great many complaints are made about the rates charged under general 
 order stores, but in many instances they are less than merchants contract to 
 pay in private bonded warehouses. In 1857 the Chamber of Commerce establ- 
 ished a tariff of rates for this storage, which was accepted by the public and by 
 the Treasury Department. That was previous to the war, when labor was at* 
 a very low rate. Mr. Barney, when he was collector, added 150 per cent, to 
 
 H. Ex. Doc. 30 6. 
 
82 
 
 NKW YORK Cl.'STOM-HorsE. 
 
 those rates; ;i nd Mr. 1 )ra|>er, immediately upon assuming office, reduced the ].',(> 
 ja r cent, added by Mr. Barney to GO per cent. In 1867 the rate of labor was 
 fifteen cents per hour; the highest rate was eighteen centp, and some of the 
 
 warehouses only paid twelve and a half cent.-. We now pay forty cents an 
 
 hour. As general order goods rarely remain in Store more than a month, lahor 
 is an important item in the charge for storage. We have to i-av now nearly 
 300 per cent, increase on the rates of 1857 j hut we were only allowed by the 
 ruling of Mr. Draper to charge GO per cent. The rates of 1S.">7 were based 
 upon labor a! fifteen cents an hour; now, when lahor is forty cents an hour, 
 should we not be entitled to more than GO per cent, increase? If yon attempt 
 
 to charge tin- merchants more than the GO per cent they will not pay it, hut 
 will go down to the custom-house and have the bill corrected according to the 
 rates of 1857, with the GO per cent, added. If we Bay to them " We will not 
 warehouse your goods fur these rates," they will say "We don't care, the rate 
 for general order goods is fixed." There are eases where we could gel a dollar 
 for storage we are compelled to accept at sixty-lour cents under general orders. 
 In fact, a neighboi of tans, in a private Store, where tin- expense is less than in 
 a bonded store, is leceivinvr H 2 it for crate stoiage. Another difficulty iu the 
 general order business is this: Under general orders we are compelled to take 
 whatever may be sent to us — that is, if it is safe to take it into the -tore We 
 may receive one package of an invoice, or we may' receive ten or a hundred; 
 and we never know tin* goods are to be delivered, or when they may be wanted. 
 
 In private wan housing a warehouseman always receives a specification of the 
 
 goods, and knows how to put them up in reference to their easy and convenient 
 delivery when called for. In general orders the want of a knowledge of this 
 met entails additional expense. 
 
 The stores set apart tor the receipt of general order goods are* always ex- 
 pected to lie ready to receive all the goods that air sent to general order within 
 the district Tie- result is that a large space is kept vacant, waiting for them, 
 which often might he tilled with private bonded goods. There were many lofts 
 in our Store wliich ni ght have been filled with goods at remunerative storage 
 prices, but which we were compelled to keep empty, not knowing when the gen- 
 eral order goods would arrive. It has sometimes been proposed to make all stores 
 general order stores. The objection to that is : if all stores were made general 
 order stores, aid liable to receive general order goods, not knowing when these 
 goods would come in, they might be filled with private goods, and when the 
 general order goods came then,' would be no room for them. For that reason 
 particular stores sl.ould be designated. 
 
 The rates of insurance on a general order store is ten cents on the *100 more 
 than on a private bonded warehouse And if one load of general order goods 
 were taken into a private bonded warehouse the underwriters would increase 
 the rates at once that amount on all the goods in the store. I think you will 
 see that, for all these reasons, a general order store should receive a larger com- 
 pensation for the goods stored there than a private bonded warehouse should. 
 Sometimes it has happened that we, have taken a good deal of goods made up in 
 single packages, and have been obliged to store them all together. When at a 
 subsequent period one of these packages would be called for, it required a great 
 amount of labor t;» find and deliver it. 
 
 In regard to the rates established by the Chamber of Commerre I will say : 
 The Chamber of Commerce is composed of merchants whose interests are, of 
 course, to have their goods stored as cheaply as possible, and it is not, therefore, 
 best that they should have the fixing of the rates. I would suggest that these 
 rates should be fixed by a committee appointed by Congress, together with a 
 committee appointed by the chamber. This would be the fairest way of doing 
 it where there are such conflicting and antagonistic interests. I don't know 
 that there is one warehouseman a member of that body. 
 
NEW YORK CUSTOM-HOUSE. 
 
 83 
 
 New York, January 15, 1867. 
 THOMAS J. BARR recalled and examined. 
 
 By the Chairman : 
 Q. Did you ever have an interview with Mr. Johnson in reference to the 
 general order business ? 
 A. Yes. 
 
 Q. Who was with you ? 
 
 A. Mrs. Perry; and myself and Mr. Johnson talked about the matter. There 
 were several others in the room at the same time. The President did not know 
 what the business was, and I explained it to him. He then told his secretary 
 to write a letter to the collector of the port of New York, telling him to give the 
 general order business from pier 59 North river to the Battery to Messrs. Ban* 
 & Phelps, if it would be no injury to the government. We had a written 
 agreement with Mrs. Perry, by which she was to receive one-third of the profits 
 of the business. 
 
 Q. Was that known to the President ? 
 
 A. Not through me ; but at the interview we all talked together. 
 Q. Did the President seem to be aware of the arrangement 1 
 A. I should say he did, by the way he acted. 
 
 Q. You had previously a written agreement with her ; had she this agree- 
 ment ? 
 
 A. She had a copy of it. 
 
 Q. Did you leave her with the President ? 
 
 A. No ; we went out together. 
 
 Q. Was the letter written to Mr. Smythe 1 
 
 A. Yes. 
 
 Q. Did you bring that letter to Mr. Smythe ? 
 A. I did. 
 
 [The chairman here read a letter.] 
 Q. Was this the letter ? 
 
 A. It was ; but there was another letter I think a little stronger. 
 
 Q. Did you ever have an interview with Mr. Smythe after his confirmation ? 
 
 A. Yes. 
 
 Q. Was this letter handed then to Mr. Smythe ? 
 
 A. Yes. He said he had to make arrangements with that business to get 
 confirmed, and that he had but a very little portion of it for himself, but that 
 he might give us a part of that portion. 
 
 Q. Have you these letters ? 
 
 A, 1 think I can produce them ? 
 
 New York, December 19, 1866 
 EDWARD 0. JOHNSON, of the firm of Johnson & Co., 4, 6, 8, and 10, 
 Bridge street, sworn and examined. 
 
 By Mr. Broom all : 
 
 Q. Are you acquainted with Collector Smythe ? 
 A. I am, sir. 
 
 Q. How long have you known him ? 
 
 A. I do not know how long • can't tell exactly. 
 
 Q. Some years 1 
 
 A. Only by report, you know. 
 
 Q. How long have you known him personally ? 
 
84 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. Only since he occupied this position, though I tliink I was introduced to 
 him at some political meeting before he was appointed collector. I tliink Rich- 
 ard B. Connelly introduced me to him. 
 
 Q. Have you known him intimately since he has been in his present position ? 
 
 A. No, sir; don't know much about him. 
 
 Q. Do you know anything of an agreement between him and Messrs. Miller 
 tV Conger ? 
 
 A. No, sir; don't know anything about him. 
 
 Q. Heard him say anything about it I 
 
 A. Never a word. 
 
 Q. Not by Miller iV Conger? 
 
 A. Have heard Miller say something, but nothing in particular. 
 
 Q. Did yon, during the negotiations with Messrs. Miller & Conger, offer to 
 give to the collector more money for the general order business than they were 
 giving ? 
 
 A. Not to the collector. 
 
 Q. Did you make such an offer to anybody ? 
 A. No, sir. 
 
 Q. Why did you say " Not to the collector?" 
 
 A. Because. you put 44 the collector" in there yourself; I heard you. 
 Q. You made no such offer to anybody ? 
 
 A. No, sir; never. I may have said casually that I would give that to any- 
 body, but 1 was mad then because somebody else had got it away from me. I 
 think I said 1 would give S40,000 for it; would not swear now positively. 
 
 Q. Did you know that was what they were to give? 
 
 A. Don't know it; heard the rumor. 
 
 Q. Did you not say that you would give more? 
 
 A. Don't know whether I said it or not. 
 
 Q. Did you not say that in the presence of the collector? 
 
 A. Not that I remember of. 
 
 Q. 1 >id you and he have any conversation at any time about the general order 
 •business ? 
 
 A. Yes ; several times ; a dozen times. 
 
 Q. I call your attention then to the first time that you conversed with him 
 about this matter. What took place ; what did he say, and what did you say ? 
 A. Can't remember anything about it. 
 Q. Where was that first interview ; can you tell that ? 
 A. Don't remember. 
 
 Q. Can you remember the place of any interview you had with Mr. Smythe? 
 
 A. I have met Mr. Smythe a great many times at the custom-house. Some- 
 times I could see him there and sometimes I could not. 
 
 Q. Can you fix your attention on any particular interview with Mr. Smythe 
 in which this general order business came up in conversation ? 
 
 A. No; can't remember; don't know anything about it. There has been so 
 much said about it, so many lies told one way and another, that they have made 
 me almost crazy. I don't think you can believe anything about it. 
 
 Q. State whether you had that general order business at any time. 
 
 A. yes; I did. 
 
 Q. When begun and when ended? 
 
 A. Can't tell; think about the 1st of August it begun, and ended on the 1st 
 of December. Don't exactly know ; got a notice from Mr. Smythe that the 
 general order business had been transferred to other parties, but they kept send- 
 ing to me and are sending to me yet. 
 
 Q. State with whom the negotiation was made. 
 
 A. Don't know anything about that. 
 
 Q. By which you had the general order business? 
 
NEW YORK CUSTOM-HOUSE. 
 
 85 
 
 A. No negotiation about it. 
 
 Q. How did you get the general order business? 
 
 A. "Well, I went into the custom-house accidentally one. day. I think Mr. 
 Smythe was there alone. I had just come down from Vermont ; had been up 
 there; thought nothing about it ; didn't care anything about it ; it was worth 
 nothing to anybody ; went in there — don't know what for — and Collector 
 Smythe says to me, "Mr. Johnson, you have been in the general order business 
 longer than anybody in this town; you keep things correct and know a good 
 deal about it " — or something of the kiud; can't pretend to say the words. " I 
 wish you to take this general order business off my hands. I want somebody 
 to make it satisfactory to the merchants and reduce the prices ; they bother me 
 to death about it. You will do me a favor to do it." I can't remember a word 
 I said about it. This is the substance of the interview, and all of it. 
 
 Q. When was this interview? 
 
 A. In July. 
 
 Q. How long after the negotiations with Miller & Co. fell through ? 
 A. I do not know. 
 
 Q. Was anything said between the collector and you on that occasion about 
 what this business was worth ? 
 A. Not that I remember. 
 
 Q. Was nothing said about your giving anything to the collector or anybody 
 else for it ? 
 
 A. Not that I remember. 
 
 Q. When you had the general order business did you let particular parts of 
 it to particular individuals ? 
 A. Yes, sir. 
 
 Q. Into how many districts did you divide it ? 
 A. Four. 
 
 Q. To whom did you let out those districts ? Name the persons. 
 A. Edwards, Atkins & Co., E. N. Lawrence, Miller & Conger, E. C. John- 
 son & Co. — that is myself — and Mr. Kimberly; no more. 
 Q. State upon what terms you let out these districts. 
 
 A. Thirty-five per cent, of the storage, saying nothing about the cartage, 
 labor, or anything of that kind. 
 
 Q. To whom was that thirty-five per cent, paid? 
 A. To me. 
 
 Q. State how much you received from Messrs. Miller & Conger. 
 A. Don't know anything about it. 
 Q. Well, then, estimate it. 
 
 A. Well, it might have been from five to eight hundred dollars. 
 Q. Well, how much from the other parties, naming them ? 
 A. Well, I guess I got from Lawrence about two hundred dollars. 
 Q. Edwards, Atkins & Co.? 
 
 A. Two thousand or two thousand four hundred dollars. 
 
 Q. Was it not three thousand one hundred and forty -five dollars? 
 
 A. Can't tell ; might have been ; wouldn't swear to it. 
 
 Q. How much did you receive from E. C. Johnson & Co.? 
 
 A. About eight or nine hundred dollars. 
 
 Q. What did you do with this money? 
 
 A. Put it in the bag to meet my expenses out of it. 
 
 Q. Did you give part of it to anybody else ? 
 
 A. No, sir. 
 
 Q. Did you receive that for your own use altogether ? 
 A. Yes, sir. 
 
 Q. Is there anybody else who has received or is to receive any part of that 
 money or any consideration ? 
 
86 NEW YORK CUSTOM-HOUSE. 
 
 A. There is no agreement or understanding of that kind. Xohudy will re- 
 ceive it without they sue me for it and get it by law. 
 
 Q. Can you tell why the collector gave to you a business for nothing for 
 which he was offered $40,000 hy you? 
 
 A. Oi you don't know anything ahout that ! 
 
 Q. Do you know ? 
 
 A. No, I don't know anything about it. IIow do I know ? I can't tell. 
 That's very singular. IIow do I know anything about any such thing ? I 
 think he was cross at the time. If you want me to tell you what I think, I will 
 tell you. Ho is a nervous kind of a man; was cross as thunder, and wanted to 
 put that thing into my hands for a few months until he could regulate it some 
 other way. That's all I know about it. 
 
 Q. Have you ever given the collector any money since In- has been in this 
 office ? 
 
 A. No, sir ; not a cent. 
 
 Q. No check ? 
 
 A. No, sir. 
 
 Q. Draft? 
 
 A. No, sir. 
 
 Q. Note ? . 
 
 A. No, sir. 
 
 Q. Ever given anybody else connected with Mr Thomson money ? 
 A. Not given to anybody. 
 
 Q. I ask you again : You said that you would give more than Miller & Con- 
 ger 7 
 
 A. No, I did not say that. I said perhaps I had said so. Don't know whether 
 I did or not. 
 
 Q. Do you not know that you have said that ? 
 
 A. I do not remember, it I have. I have said a thousand things about it that 
 I do not remember anything about. 1 presume I have, but I would not swear 
 to it. 
 
 Q. How long after you presume you had said that was it that the collector gave 
 you the business ? 
 A. Don't remember. 
 Q. Month ? 
 A. Could not say. 
 Q. Week? 
 
 A. Cannot say. I went away to Vermont, and do not know what took place. 
 
 Q. Was it next day ? 
 
 A. Don't remember whether it was or not. 
 
 Q. What induced the collector to give you this business for nothing for which 
 you are willing to pay $40,000 ? 
 A. Don't know anything about it. 
 
 Q. Do you say on your oath that the collector gave you this business for 
 nothing ? 
 
 A. Don't know whether he did or not. Never paid him anything, never agreed 
 to pay him anything, and there never was an understanding to pay him anything. 
 Do you understand that ? 
 
 Q. Pay anybody else ? 
 
 A. No, sir. 
 
 Q. Do you say that he gave you this business for nothing ? 
 A. I mean to say that I don 't know anything he ever gave it to me for. 
 Q. Do you mean to say on your oath that the collector gave you this busi- 
 ness for nothing ? 
 
 A. As far as I know, he did. 
 
NEW YORK CUSTOM-HOUSE. 
 
 87 
 
 Q. During the time that you had this business under the collector did you 
 have any interviews with George F. Thomson ? 
 A. I saw him a number of times. 
 
 Q. Did you have any conversation with him in relation to the general order 
 business ? 
 
 A. I presume I did ; I don't know. 
 
 Q. Had George F. Thomson any interest whatever in the general order 
 business until you had it ? 
 A. Not that I know of. 
 
 Q. If he had had would you have known it 1 
 A. I do not know anything about that. 
 Q. Had he any interest whatever in your contract ? 
 A. I had no contract. 
 
 Q. Not in your arrangement with the collector ? 
 
 A. I had no particular arrangement with the collector. He simply gave it 
 to me. 
 
 Q. Had Mr. Thomson any interest in that business? 
 
 A. Not that I know of. 
 
 Q. Did you pay him any moneys ? 
 
 A. Never. 
 
 Q. Are you to pay him anything ? 
 
 A. Nothing; never under any obligation, either moral, political, social, or in 
 any other way. 
 
 Q. Did you ever talk with him about giving him moneys or any other property ? 
 A. Not that I remember of. 
 
 Q. Do you want the committee to believe that Collector Smythe gave you 
 this business for nothing for which you were willing to give $40,000 1 
 
 A. I don't know what you want to believe; I don't care what you want to 
 believe. 
 
 Q. You say that is true on your oath, that he gave you the business for 
 nothing, that you are willing to give $40,000 for ? 
 
 A. Do not. Don't say any such thing. I offered him no inducement. Some- 
 body else might have induced him, but I know nothing about it. 
 
 Q. Were you an applicant for the business while Messrs. Miller & Conger 
 were negotiating ? 
 
 A. Don't know ; think likely as not I was. 
 
 Q. Can you state whether you was or not 1 
 
 A. Don't know any particular shape I put the application in. Did not make 
 it direct. 
 
 Q. To whom did you make the application? 
 A. I do not know. 
 Q. You do know. 
 
 A. I say I do not know. Now you and I come in conflict ; I swear to it. 
 Q. You say you did not make any application directly to Mr. Smythe"? 
 A. I did not say that. I said I did not know whether I did or not. 
 Q. How did you make the application, if you did not make it direct 1 
 A. I don't know anything about it — I don't — certain. 
 Q. You did not make it direct to Mr. Smythe ? 
 A. What time are you speaking of? 
 
 Q. During the time you learned that Messrs. Miller & Conger were nego- 
 tiating. 
 
 A. Not that I know of. I don't remember of making any application at that 
 time. 
 
 Q. Did you ever make any application indirectly to the collector for the 
 business ? 
 
 " A. I don't recollect that I ever did. I talked to a great many people about 
 
88 
 
 NEW YOKK CUSTOM-HOI'SK 
 
 it. Sonic influential men interceded for mo. I talked with William M. Evarts 
 He Baid he would get it for me. 
 
 Q. Did von offer him any inducements? 
 
 A. No J he lias been my lawyer for twenty years. I did not think it 
 
 necessary. 
 
 Q. Do you suppose lie would have accepted it ? 
 
 A. I piesume he would, as likely as you would receive the thirty-five per 
 cent for nothing. 
 
 Q. State what service s you rendered, if any, of any kind to the custom-house 
 or the government for this thirty-five per cent, which you rec< ived ch ar. 
 A. 1 can state nothing. 
 
 Q. Did you render any serve es, or do anything I 
 
 A. I was joint partner with those men — with Miller ..V- Conger, with Ed- 
 wards, Atkins & Co., with the Bixbys, with Henry 0. Bowen. Bowen ran the 
 Independent. He got thirty per cent, of' me. lie got the contract when Barney 
 was collector. 
 
 Q. Do you know whether they rendered any services? 
 A. I do not know. 
 
 Q. What did you do for Edwards, Atkins & Co.? 
 
 A. 1 instructed them about the business. I told them what to do. Something 
 turned up every (lav or two that went wrong, and I would go and investigate 
 it. Attended to them in the custom-house It took me the whole time. 
 
 Q. You have answered that you have paid, and are to pay, nothing to Mr. 
 Thomson ? 
 
 A. Yes, sir, and to nobody else. 
 
 Q. Has Thomson an office in your stoie on Bridge street? 
 A. No, I don't think he has. He comes there once in a while. lie asked 
 mo if he could have a desk there. I told him yes. 
 Q. Is he a clerk in your employ ? 
 A. O, no. 
 
 Q. Would Mr. Lane, your partner, be likely to know it if he was? 
 A. I think so. 
 
 Q. Would Mr. Lane be likely to know it if he receives it frpm you ? 
 
 A. He would. 
 
 Q. You say he does not? 
 
 A. Never to my knowledge. 
 
 Q. Did you offer to sell to Messrs. Humphrey & Co. any portion of the 
 general order business ? 
 
 A. No ; don't know Humphrey ; never saw him. 
 
 Q. Did you the firm of which Mr. Bixby is a member ? 
 
 A. I was introduced to Mr. Bixby one day, and I says to him, " I would like 
 a little of this general order, and you have got a good deal of it, and Frank 
 Squier has some of it ; can we fix this up ?" Bixby said he would not give any- 
 thing for it, and would not have anything to do with it, and off he went. That 
 is about all the conversation I had with Mr. Bixby. 
 
 Q. What did Mr. Squier say ? 
 
 A. I don't recollect. 
 
 Q. When was that ? 
 
 A. Well, I don't know. 
 
 Q. How long before you got into business ? 
 
 A. It was before I got the business; I don't know how long. 
 
 Q. Did you in any of your interviews with these gentlemen speak about how 
 much you would give for the business ? 
 
 A. They said, " You have offered forty or fifty thousand dollars for the busi- 
 ness, and you are a fool," or something of the kind. I do not know whether I 
 said it or not. I perhaps said something of the kind. 
 
NEW YORK CUSTOM-HOUSE. 
 
 89 
 
 Q. You did not deny it ? 
 
 A. I never offered anything to the collector ; never offered anything to any- 
 body. 
 
 Q. Did you deny it when they made the assertion ? 
 A. I do not know whether I did or not. 
 
 Q. Did you inform them, or either of them, or any person connected with 
 them, or any other person, that you and the collector, or either of you, had got 
 the general order business fixed up so that no damned congressional investi- 
 gating committee could find out anything about it, or words to that effect ? 
 
 A. Not that I remember of. Xo, never. 
 
 Q. Do you remember any conversation alluding to that ? 
 
 A. Nothing of that kind, 
 
 Q. Did you inform any of them that if they bought the general order busi- 
 ness and paid the price asked, that they could charge anything they chose, and 
 that the collector would sustain them, or words to that effect ? 
 
 A. Never, that I remember of. 
 
 Q. Did you ever converse with anybody upon the subject ] 
 
 A. I have never had intercourse with those men. They are beneath contempt, 
 
 in my opinion. I never had but one interview with the Bixbys, except to pass 
 
 the time of day. 
 
 Q When they declined to negotiate it do you remember the ground they put 
 it on I 
 
 A. I do not. 
 
 Q. Was it because it would lead to a violation of the latv ? 
 
 A. I don't recollect it. If it was, they had violated the law for ten years. 
 
 Q. Do you say, on your oath, that you have had no understanding of any 
 kind with Collector Smythe, or with Mr. Thomson, by which they have been, 
 or expected to be, benefited by this business ? 
 
 A. I have sworn to that question before, and I have answered invariably that 
 I had no kind of encouragement or understanding with anybody, in any shape 
 whatever. 
 
 Q. Have you loaned moneys to the collector or counsel within six months % 
 A. No, sir. * 
 
 Q. To anybody connected with the custom-house ? 
 
 A. Not that I am aware of. There are inspectors and all sorts of things 
 come in sometimes, and borrow fifteen or twenty dollars. I consider it as a 
 gift; never expect to get it back. Thomson or the collector never have; 
 other men may have. I would let them have the money, perhaps, and then tell 
 them to go off and never come to me again, or something of that kind, and 
 would never think again about it. 
 
 Q. Have you ever loaned to Mr. Smythe or to Mr. Thomson any check or 
 anything else of value, or given or proposed to give them anything? 
 
 A. No, sir. 
 
 Q. Did you pay to any person connected with the revenue department any 
 sum because of the transfer of the goods from the appraisers' stores to your 
 warehouse on Bridge street? 
 
 A. Never, that 1 remember of. 
 
 Q. Did you loan to anybody ? 
 
 A. I have loaned, as I have told you, at different times to custom-house offi- 
 cers. They thought, because I kept a bonded warehouse, I made money. I 
 am a good-natured fellow, and would often loan the money, and every time I 
 did it, would say I never would do it again. I presume I have lost a great 
 deal of money that way. A Mr. Garish once borrowed some ; I do not remem- 
 ber how much. 
 
 Q. Did it amount to one or two hundred dollars ? 
 
 A. 0, no ; nothing like that. 
 
90 NEW YORK CUSTOM-IIOUSK. 
 
 Q. As much aH fifty dollars? 
 
 A. Yen; I think so He paid me that. 
 
 (,). To whom else, connected with the custom-house, did you loan money? 
 
 A. I do not recollect ; cannot name anybody else. 
 
 Q. Did you pay »»r loan to Daniel Jackson any money? 
 
 A. I think he owes me fifty dollars ; I don't know. 
 
 Q. Have you given it to him or loaned it to him while letting out the general 
 order business '{ 
 
 A. I cannot tell when. lie asked me for fifty dollars, and 1 loaned it to 
 him. It was in the Dame of a loan ; I never expected to get it. 
 Q. State whether in reality it was a gift. 
 
 A. I know it was not. I thought he would pay me; but I shall never ask 
 him for it. I suppose I have got $25,000 out that way. 1 am a good-natured 
 fellow. If I had kept my money I would have been rich. 
 
 Q. Were you a candidate for office In this city? 
 
 A. Yes, sir; member of assembly. 
 
 Q. Were you elected I 
 
 A. No, sir. I was a candidate for school officer too, and was elected in a 
 democratic district. 
 
 Q. Did you contribute funds to the recent election in New York ? 
 
 A. I presume I spent two or three thousand dollars in the November election 
 in New Y'ork ; can't pretend to say how much; spent my money freely among 
 the boys. 
 
 Q To whom did you give the last sum named? 
 
 A. Well, I spent it around among the bar-rooms, to tell the truth. 
 
 Q. To be used for political purposes / 
 
 A. Y T es ; would give out five dollars at a time. A man would come to me 
 and say, "I can carry a certain district for you;" I would give him ten or fif- 
 teen dollars. 
 
 Q Do you mean that you contributed that for electing Fenton ? 
 A. Yes, sir. 
 
 Q. Do you know Horace B. Clafliu ? 
 
 A. Yes, some ; not much, I don't. 4 
 Q. Did you at any time say to him that you were to pay to Smythe, or to 
 anybody else, any money or value of any kind for, or connected with, the gen- 
 eral order business ? 
 
 A. Not that I remember of. 
 
 Q. Would you have told him that if it had not been true 1 
 A. No. 
 
 Q. You have said that that is not true ? 
 
 A. I did not say anything about it ; I do not know anything about it. 
 
 Q. Were you, or were you not, to pay, loan, or to give to Mr. Smythe, or to 
 any other person, any sum or value of any kind for, or counected with, the gen- 
 eral order business I 
 
 A. I do not understand the question. 
 
 Q. You have said you were not to pay, loan, or to give to Mr. Smythe, or to 
 any other person, any sum or value of any kind for, or connected with, the gen- 
 eral order business ? 
 
 A. Y'es, I said that. 
 
 Q. You say you do not know whether you told Mr. Claflin whether you had 
 or not ? 
 
 A. I do not recollect any such conversation. 
 
 Q. Did you ever have any conversation with Mr. Claflin about paying or 
 giving anything for the general order business ? 
 A. I do not recollect that I ever did. 
 
NEW YORK CUSTOM-HOOSE. 
 
 91 
 
 Q. In the interview which you have spoken of as having with Mr. Bixby, 
 who was present ? 
 
 A. His brother ; he introduced me to him. 
 
 Q. Did you propose to them that they should take the business on the North 
 river ? 
 
 A. I do not know whether I did or not. 
 
 Q. Did you propose they should take any part in the general order business 
 and pay for it ? 
 
 A. I do not know ; I did not have it then. 
 
 Q. Did you tell them you had " knocked the Miller & Conger arrangement 
 into a cocked hat:" 
 A. I do not recollect. 
 
 Q. Did you tell them that Miller & Conger had bought the business for 
 $40,000, and that you had gone to Mr. Smythe and offered him $50,000, or any 
 other sum ? 
 
 A. If I told them so it was not so, for I never did. But I do not recollect 
 telling them so. 
 
 Q. Did you not tell them that after making that offer you went out of town 
 and knew when to come back ? 
 
 A. I don't recollect any such thing. 
 
 Q. Did you say anything to them about Thomson ? 
 
 A. Not that I remember of. 
 
 Q. Did you not tell them that they could charge the merchants as they pleased, 
 and that you would take the responsibility of seeing their bills through ? 
 
 A. I don't believe I ever did. I believe it is a lie, if they said so. 
 
 Q. In all your interviews with Mr. Smythe or Mr. Thomson, was the name 
 of Senator Patterson or of Senator Doolittle introduced ? 
 
 A. Never, that I recollect of. 
 
 Q. Do you know George F. Thomson 1 
 
 A. Yes, I know him, I think. I know a man they call Thomson — George 
 Thomson ; don't know whether there is an F. in his name. 
 Q. Do you swear whether you do or not 1 
 A. I will swear I think I do. 
 Q. Do you know whether you do or not ? 
 
 A. I do not know whether there is an F. in his name or not. I know a man 
 they call George Thomson. Can't tell you anything about him. I never 
 knew him until this general order business came up. Don't know who intro- 
 duced him, or if he introduced himself. 
 
 Astor House, N. Y., January — , 1867. 
 THOMAS BROWN sworn and examined. 
 
 By the ChairmAxN : 
 Q. About how long have you been in this city ? 
 
 A. I live in Elizabeth, New Jersey ; have done business in New York for 
 two years. 
 
 Q. Have you been connected with the government during that time in any 
 shape ? 
 
 A. Since June, 1S66; first with the custom-house, and now as treasury 
 agent. 
 
 Q. When did your connection with the custom-house commence, and what 
 was it ? 
 
 A. It commenced in June, 1866, as private secretary to Collector Smythe. 
 
92 
 
 NEW TORE CUSTOM-HOUSE. 
 
 Q. Will yon state to the committee what the duties of private secretary are, 
 and what relations they bring you into with the collector? 
 
 A. Perhaps I can answer that question hetter hy saving that I was invited 
 hy Mr. Smythe to come into the office with him as private seen tary on account 
 of my general familiarity with custom-house matters, which I had acquired hy 
 several years' experience on tin* Pacific coast as special agent of tie- Treasury 
 Department. While I was with the collector I wrote few letters, and was in 
 nowise a secretary; but I saw all callers and had general supervision of matter! 
 incident to the collector's office. 
 
 Q. Your office, of necessity, made your relations with the collector quite con- 
 fidential? 
 
 A. Entirely so; confidential and fiiendly, so far as I know. 
 
 Q. I want to ask you all about any arrangements the collector made with 
 anybody as to the general order business. 
 
 A. Shortly after I went into the office — I think within a fortnight — I heard 
 much outside talk about the "general order business" Mr. Smythe did not 
 communicate with me about it until he had made his arrangements. I was told 
 after the completion of the arrangement that the parties who got it — to wit, 
 Miller & Conger — were to pay for the privilege S40.000. When I heard of 
 this I protested against it to the collector. 1 le had evidently ben persuaded 
 into the belief before he was made collector that the profits of the general order 
 business were a legitimate perquisite of the office. Of this I did my best to dis- 
 abuse him. I told him that admitting that it was legitimate, (which I did not 
 for a moment,) he would be in continual trouble about it; and I begged him to 
 let it go, hut without avail. 
 
 Q. Did the collector at that time give the reason why, as he had entered into 
 it, he must go on with it ? 
 
 A. I do not think he did. He seemed to feel obliged to go on with it ; but 
 I am not clear about that. Afterwards he stated to me what was to be done 
 with the money. 
 
 Q. Please give the names of the beneficiaries. 
 
 A. I did not see the names. I simply saw the figures, which amounted, in 
 the aggregate, to 840,000 ; and the collector said to me that he would do so and 
 so with it. I cannot remember the names. I have seen them since in the hands 
 of one of this committee. I remember that George F. Thomson was one of 
 them. 
 
 Q. Would you recollect the names if they were presented to you ? 
 
 A. I think I should. I know of two names that Mr. Smythe mentioned at 
 the bottom of the list. He said, "There is an amount which I propose to divide 
 between two friends of mine." I did not know, then, who they were; but after- 
 wards he said that Mr. Embree and myself were the friends. I think the amount 
 was 84,000. I remember very distinctly the unpleasant impression it made on 
 me. My reply was, that it was the collector's matter and not mine ; that all I 
 expected to get was what Mr. Smythe promised me as my salary. I think, in 
 justice to myself, I ought to state this to put myself right on the record. The 
 only conversation I ever had with Mr. Smythe in reference to my salary was 
 this : After he was confirmed as collector, he said to me that he wanted me as 
 his private secretary, or in the position nearest to him, on account of my knowl- 
 edge of customs matter. I asked him if he knew what salary the private sec- 
 retary was entitled to? He said he did not. I then told him it was 81,500, 
 and that I could not spend my time for any such sum. He said to me in reply, 
 "I will double that salary to commence with." I told him I wanted 55,000. 
 His reply was to leave the matter with him. That is all the conversation I 
 have had with him on that subject. What I have received from Mr. Smythe 
 has been at the rate of 83,000. Where the excess came from I do not know. 
 I suppose he paid it out of his own pocket. 
 
NEW YORK CUSTOM-HOU&E. 
 
 93 
 
 By Mr. Rollins : 
 Q Are you still his private secretary ? 
 A. No, sir. 
 
 Q. When did you leave that post ? 
 
 A. I left it about a month before the New York election — about the first of 
 October. 
 
 Q. Are you familiar with custom-house matters in California? 
 A. Intimately — all the treasury matters on the coast. 
 
 Q. To recur to the subject of the distribution of the $40,000. Do you recol- 
 lect the name of Mr. Van Bergen? 
 A. Very well. 
 
 Q. And that the amount to him was $10,000? 
 
 A. I don't remember the amount; it was either five or ten ; five, I think. 
 
 Q. And Mr. George F. Thomson, formerly of the Daily News, $10,000] 
 
 A. My recollection is, that Mr. Thomson was to get but $5,000. 
 
 Q. Senator Patterson ? 
 
 A. He was to be a sharer, I think. 
 
 Q. Deputy Collector Embree? 
 
 A. He was to get $2,000, I think. 
 
 Q. And $10,000 to be retained by the collector? 
 
 A. I think so. He said he wanted it to be retained because he did not want 
 any levies on the custom-house for political purposes. $40,000 was the aggre- 
 gate. As to the details of each share, I know nothing except what I have 
 stated. 
 
 Q. Was Senator Doolittle or his son to have any ? 
 
 A. Senator Doolittle's son was to have a benefit from the custom-house in 
 some shape. 
 
 Q. Do you recollect whether any sum or amount was named? 
 
 A. My impression is that Colonel Doolittle was to have $5,000. 
 
 Q. Do you know whether there was a woman introduced to the collector by 
 the President's letter who was to receive some benefits from the custom house 
 matters? 
 
 A. I do know that there was a woman, whose name I heard at the time, (it 
 was Mrs. Perry,) who was to receive $3,000. 
 
 Q. Did she bring a letter of credit from Washington 1 
 
 A. Mrs. Perry told me she had a letter from the President to Mr. Smythe. 
 I did not see it. 
 
 Q. Have you an impression as to its contents derived from her? 
 
 A. I know, from conversation with Mrs. Perry and the collector, that she had 
 an influence with the President that could not be resisted by the collector. 
 
 Q. Do you know the amount the collector paid Mrs. Perry ; and if so, how 
 much ? 
 
 A. I remember the collector sent her a check for $500. 
 
 Q. Did you see the letter enclosing check ; and if so, what were its contents ? 
 
 A. Yes ; in the letter enclosing the check, Mr. Smythe stated to her distinctly 
 that the arrangement in reference to the general order business had failed, 
 (referring to the Miller & Conger arrangement,) and that he did not feel that he 
 could pay her any more money beyond the enclosed check, which came out of 
 his own pocket. 
 
 Q. Did you see any acknowledgment of this money by Mrs. Perry ? 
 A. I did. 1 saw Mrs. Perry's reply to the collector. He handed it to me, 
 and asked me to read U. 
 
 Q. State the substance of it. 
 
 A. It was quite a long letter. She thanked the collector for his kindness ; 
 was quite disappointed as to the result ; and while she did not claim anything of 
 
94 
 
 NEW YORK CUSTOM-HOUSE. 
 
 the collector, she knew where to go, and would immediately go to the President 
 ii reference to the matt* r. 
 
 Q. Do you recollect the collector paying moneys to any other parties at or 
 about that time ? 
 
 A. I remember that he paid 8000 to George F. Thomson & Co. ; also another 
 check, the amount of which I have forgotten, to the "Johnson committee" in 
 Washington That was to the order of Mr. Doolittle. I think it was * 1,500" : 
 I am not positive. 
 
 Q. On this arrangement with Messrs. Miller & Conger, did the collector re- 
 ceive anything from them, directly or indirectly ? 
 
 A. No, sir; such a suspicion never crossed my mind. I have not the least 
 doubt of the integrity of Mr. Smythe ; and I think that receiving money in such 
 a way would be no better than stealing. I do not think Mr. Smythe ever made 
 a single cent, personally. That is my belief. 
 
 Q. Why did the arrangement of Messrs. Miller & Conger fall through ? 
 
 A. I always supposed it failed because they could not get the stores of (.Jetty 
 & Sons bonded, which they intended to make the general order depot. 
 
 Q. Who did get the general order business '.' 
 
 A. E. 0. Johnson, called Johnson &; Co. 
 
 Q. I>o you kuow the conditions on which they received it? 
 
 A. I do not. After the old arrangement fell through, I said to the collector, 
 " If you make any new arrangement, I beg you will let me know nothing what- 
 ever about it " 1 never did know anything about it. He assured me he got 
 nothing, either directly or indirectly, for any purpose whatever; and I believed 
 it. I do not believe it now. 
 
 Q. You say von believed it. Hav< you any reason, now, to entertain a dif- 
 ferent opinion with reference to that transaction '.' 
 
 A. I can state no particular reason, but I have an impression that, although 
 Mr. Smythe was not personally benefited by it in any way, yet some of the 
 politicians, or their friends, shared in it ; but I do not know. 
 
 Q. You have reasons for entertaining that opinion ? 
 
 A. Why, sir, I have not a doubt about it, and yet I cannot give you any 
 positive evidence of it. I am as sure of it as a man can be of anything, short 
 of a demonstration. 
 
 Q. When you say "politicians," whom do you mean by that designation? 
 
 A. 1 know that Ex-Governor Pratt, of Maryland, shared in certain remittances 
 from the custom-house. I know that a SoOO check, which I gave to the col- 
 lector one day, he said he was going to send to Governor Pratt, of Maryland. 
 
 Q. Do you know how Governor Pratt became acquainted with the collector? 
 
 A. He brought a letter fiom the private secretary of the President, Mr. Ed- 
 ward Cooper, commending him to the collector. 
 
 Q. Was it written in behalf of the President? 
 
 A. I so understood it. 
 
 Q. Did the collector ever make any remarks to you that he had helped the 
 President's family, or intended to help them, or that would lead you to believe 
 that he proposed to help them, by money or otherwise? 
 
 A. About a fortnight ago there appeared in the New York Times a very 
 offensive paragraph in reference to the general order business. I happened in 
 the collector's room one morning just after its appearance, when he referred to 
 it, and remarked that he was very sorry he had undertaken to help the Presi- 
 dent's family. 
 
 Q. Any other remark ? 
 
 A. No. He seemed to suppose that I knew about it, but I did not. 
 
 Q. Did the firm of E. C. Johnson, that received the general order business 
 after the failure of the Miller & Conger arrangement, agree to pay any consid- 
 eration for the business, to your knowledge or belief, to the collector, or to any- 
 body else that he designated or desired ? 
 
NEW YORK CUSTOM-IIOUSE. 
 
 95 
 
 A. My general reply to that is, that I do not know anything about it. I 
 always supposed there was an arrangement with somebody about the thing. 
 
 Q. Do you know how the business was conducted with reference to charges 
 by them ? 
 
 A. There were frequent complaints of exorbitant charges after the business 
 went there. Persons complaining came to my desk, and 1 referred them to Mr. 
 Smythe, and insisted on his deciding to have a rule about these matters ; or that 
 he would eventually get himself into very great trouble about them. He told 
 me to allow such charges as were indicated by the deputy collector in charge of 
 the bonded warehouse, and I wrote a letter to that effect, which the collector 
 signed. But that did not seem to remedy the evil ; but in every case after that 
 which came to my desk that order was enforced. This was one reason why I 
 supposed there was some arrangement which I knew nothing about, that parties 
 other than Johnson & Co. shared in the earnings. 
 
 Q. You have no knowledge of their giving to Collector Smythe any money, 
 check, or property otherwise 1 
 
 A. None. The condition on which they received the business, I knew noth- 
 ing about. 
 
 Q. Were you his private secretary when the business was taken from them 
 and given to another house, which at present conducts it ? 
 A. No. The change was made long after I left. 
 
 Q. Have you any knowledge why the business was taken and given to 
 another firm? 
 
 A. I have never had any conversation with any person about it. 
 Q. Have you any information to give to the committee upon the cartage 
 business ? and if so, what ? 
 
 A. The cartmen while I was there were Lindsey, Keyes, and Meagher. 
 Q. Who designates the cartmen ? 
 A. The collector. 
 
 Q. Do you know anything about the arrangement between them and the col- 
 lector, if there was any 1 
 
 A. I knew, at the time it was made, nothing about it. I did not know these 
 gentlemen even by sight. 
 
 Q. Did you learn, subsequently % 
 
 A. Subsequently Mr. Keyes and Lindsey came to my desk, after they had 
 been doing the custom-house cartage for a month, and wanted to see the col- 
 lector. I then informed him that they were outside and desired to see him. 
 He asked me if I would not see them. I did so, and learned that they were 
 there to render an account of their month's business. They showed me a tran- 
 script from their books, with the profits, which were shared equally between the 
 three gentlemen before named. They then informed me that the collector, 
 when he had given them the cartage, said that they should have three-fourths 
 of it, and one-fourth interest he wished to retain for another party. The fourth 
 interest amounted, I think, to $250. I took this statement, with a check for 
 that amount, to the collector and laid it before him. He looked at it and said : 
 " I do not want anything to do with this matter. Will you not pass the check 
 to your account % and when I have to send another check to Washington I will 
 ask you for it." I passed it to my account, as I did not want to disoblige Mr. 
 Smythe, of course. The next month came around and they returned with like 
 statement and check for Mr. John Jones. I showed neither the statement nor 
 check to the collector, but placed it to my credit. Shortly after that, having 
 left the office, the collector asked me if I had any money for him ; that he had 
 to make another remittance to Washington. I told him I had about $500. He 
 asked me to give him a check for the amount, which I did. That, I think, 
 went to ex-Governor Pratt. He stated at the time that he did not desire it to 
 appear in his account. 
 
96 
 
 NEW YORK CUSTOM-IIOl.'SK. 
 
 Washington, FvLntary 12, 1SG7. 
 JAMES F. PIERCE called and sworn. 
 
 By the Chairman : 
 
 Q. Where is your place of business ? 
 A. New York. 
 (,). What is it ? 
 A. I am a lawyer. 
 
 Q. Waiving all preliminaries and circumlocutions, I ask, 1 > i < 1 yon at any time 
 
 last fall hear Mr. Smythe, collector of New York, make any remark in reference 
 
 to a contemplated disposition of the funds arising from the general order 
 business ? 'If yes. did he, in the same conversation and connection, une the 
 names of Mr. Patterson or .Mrs. Patterson, Senator Doolittle or his son, and 
 Robert Johnson, or others ? Question is general, as I have had no communica- 
 tion with you, directly or indirectly, on this subject. 
 
 A. I dislike very much to answer; but il 1 must. I have to say: some time 
 in October last, as near as I can remember, in a desultory conversation with 
 
 Mr. Smythe, collector of New fork, in custom-house, he Stated, to t'jc best of 
 my recollection a that he had agreed to give, or was g >ing to give, out of the 
 general order business, So, 000 to Robert .Johns m ; $5,000 to .Mr. or Mrs Pat- 
 terson; So, 000 to a son of Senator Doolittle, and retain in his own hands -So, 000 
 or $10,000 for political purposes — that the President knew nothing of this. 
 
 New York, Mn f ,<li>j. December 17, 1866. 
 ALEXANDER SPAULDING sworn and examined. 
 
 By the Chairman : 
 Q. State your residence and profession. 
 
 A. I am an attorney and counsellor, doing business at 111 Broadway, New 
 York. 
 
 Q. Have you been employed as counsel for the Messrs. Bixby ? 
 A. Yes, sir. 
 
 Q. In what branch of business or pertaining to what transaction ? 
 
 A. I have been acting as general counsel and attorney for a number of years, 
 and in July last I was employed by him to go to Washington to make some 
 representations in regard to the general order busiuess. 
 
 Q. You will please state to the committee who you saw there, and the in- 
 formation you derived from the persons there, pertaining to this business. 
 
 A. I had an interview with Secretary McCulloch in regard to the general 
 order business about the 27th of July last — I think that was the day. I had 
 some correspondence with him in regard to custom house business here in this 
 city. Prior to the 30th of July, and I think on the 27th, I had a personal in- 
 terview with him. I informed him that the fact could be established in this city 
 that Collector Smythe had made the patronage incident to his control over the 
 general order business of the custom-house a matter of bargain and sale, and I 
 requested his interposition in the way of putting a stop to the consummation of 
 some negotiations which I understood at that time were pending. I correct my 
 statement in regard to it ; it was on the morning of July 30 I addressed him a 
 letter, of which the following is a copy : 
 
 Washington, July 30, 1866. 
 Sir : I have thought it proper, before leaving Washington, to reduce to 
 writing and put in form of charges against Henry A. Smythe, collector of the 
 
NEW YORK CUSTOM-HOUSE . 
 
 97 
 
 port of New York, relating to certain official irregularities and improprieties in 
 reference to which you were so kind as to accord me a personal interview this 
 morning, and for which I desire to express my acknowledgments. 
 
 In the execution of the purpose above expressed, I have to state that I am 
 advised that conclusive proof can be submitted to the department showing that 
 said collector has attempted, in his official position, to make money for his own 
 use and benefit, or for his personal or political friends — 
 
 1st. In the sale in the storage of imported goods. 
 
 2d. In the sale of the cartage of imported goods to and from the appraisers' 
 store. 
 
 3d. In the sale of the lighterage of goods from quarantine to the cities of New 
 York and Brooklyn. 
 
 4th. In the leasing of Getty's stores to the United States for the use of the 
 appraisers. 
 
 I require only a reasonable time in which to substantiate, by proof, not one, 
 but all of the above specifications of charges of said collector's official delin- 
 quencies. 
 
 I shall return to New York this evening, and at once address myself to the 
 task of collecting evidence bearing upon them. The results will be transmitted 
 to your department with all possible despatch. 
 
 I cannot see that the public interests can in any way suffer if Mr. Smythe's 
 application to have certain stores at the corner of West and Leroy streets 
 bonded should be delayed until the proofs bearing upon said charges shall have 
 reached you. 
 
 Very respectfully, your obedient servant, 
 
 A. SPAULDING. 
 
 Hon. Hugh McCulloch, Secretary, fyc. 
 
 My impression is I had an interview with Mr. McCulloch immediately after 
 this note reached him. It was secured through the intervention of a gentleman 
 in Washington whose name I cannot now recall. I do not recollect the day of 
 the week, but it was on July 30 ; I think it was on Wednesday ; and I asked from 
 the Secretary some eight or ten days for the purpose of going back to New York 
 to get the requisite proof, and he would only give me until the following Mon- 
 day. I was detained a day or two longer than I was expected to be on other 
 business, and when I got back to the city I found the time allowed me to get 
 the proof had elapsed, and it was impossible for me to get the evidence — in fact 
 I could not get the parties, as they were not in the city at the time. I subse- 
 quently addressed him another letter, of which this is a copy : 
 
 111 Broadway, New York, 
 
 August 2, 1S66. 
 
 Sir : Since the personal interview with you on Monday last touching the 
 official delinquencies of Henry A. Smythe, esq., collector, &c, I have been 
 brought in contact, in connection with the same matter, with the joint committee 
 of Congress, which is to sit in this city this month for the examination of mat- 
 ters pertaining to the custom-house of this and other ports. 
 
 It was suggested by a prominent member of said committee that the charges 
 to which your attention has been called should be brought before it for exam- 
 ination — they having full power in the premises, and it being one of the duties 
 with which it was specially charged. 
 
 It must be apparent to every one that the suggestions of the party to whom 
 I have referred are entitled to great weight, aside from the consideration that 
 said committee has the power to compel the attendance of witnesses and can 
 enforce the production of books and papers. 
 
 I have, therefore, to inquire whether you would recommend the examination 
 H. Rep. Com. 30 7. 
 
98 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Upon proof of said charges cx ]>arte, or to have it p< stpone 1 until the meeting of 
 .-aid committee. 
 
 Whichever course you may think advisable I feel as-ured will result in a 
 vindication of my action thu3 far, and astound your department with the magni- 
 tude and profligacy of the frauds attempted. 
 Your obedient servant, 
 
 A. 8PAULDING. 
 
 Hon. Hugh McCulloch, 
 
 Secrctaiy of the Treasury. 
 
 By Mr. EOLLINfi : 
 
 Q. Did you seek for delay in the matter of the lease of the Getty stores ? 
 
 A. It is my recollection that one branch of the letter was to this fact, that 
 an application had been made or was to be made for the bonding of these stores* 
 (Getty's;) that somebody else was to obtain the stores from (Jetty, and an ar- 
 rangement was then to be made to release them at very advanced rates for public 
 store purposes to the government ; and a nice little profit was to be made 
 between the price Mr. Getty was to get from this other party. I understood at 
 that time this had not been consummated. My understanding is this — that be- 
 fore this store could be used by the appraisers it had .to go through the operation 
 of being bonded. This store could be obtained from Mr. (Jetty at a certain 
 figure. 
 
 Q. Do you know the figure ? 
 
 A. I do not. It could be obtained for a certain figure, and if the store could 
 be bonded it was to be leased to the government for the use of the appraisers. 
 
 By Mr. Broomall : 
 
 Q. Have these stores been leased since ? 
 
 A I do not know, sir. There was some disturbance made about it at the 
 time, and I think that matter was checked. I think the 30th of July w »s 
 Wednesday. I requested from Secretary McCulloch some eight or ten days to go 
 back to New York and get proof of the charges contained in my letters. The 
 Secretary said to me Mr. Smythe was a reputable man and of high standing in 
 New York, and he did not think there was any foundation for the charges what- 
 ever, and he refused to let the matter remain in abeyance any longer than the 
 Monday following. Being detained until Friday and not getting back until 
 Saturday, I could not have produced the proof on Monday, and consequently 
 did not follow my charges up. I subsequently wrote him from this city, and 
 received a reply, as follows : 
 
 Treasury Department, 
 
 August 3, 1S66. 
 
 Dear Sir: Your favor of the 2d instant is received. It would be improper 
 for me to suggest the course that should be pursued in the investigations of 
 alleged improper action on the part of officers in the revenue department. In 
 the particular case to which you allude, I judge, from the high reputation of the 
 person charged, that he would prefer such an investigation into his official con- 
 duct as would be the most thorough and fair. 
 I am very truly yours. 
 
 h. Mcculloch. 
 
 A Spaulding, No. Ill Broadway, N. Y. 
 
 A. I think it was before I got this letter, or very soon after, that I was advised 
 by Mr. Bixby that the stores had been bonded for which an application had been 
 made at the time I went to Washington, and which I was desirous of preventing, 
 in order to prevent the consummation of this arrangement on the part of Mr. 
 Smythe. 
 
NEW YORK CUSTOM-HOUSE. ( J9 
 
 Q. Had you a conversation with Senator Doolittle 011 this subject? 
 A. I did have some conversation with Senator Doolittle in regard to this 
 matter. 
 
 Q. About what time ? 
 
 A. About the 27th of July. 
 
 Q. Please state what the conversation was, and your part and his part. 
 
 A. I told him the object of my visit was to prevent the consummation of cer- 
 tain custom-house improprieties which were on the point of being perpetrated 
 by Collector Smythe. I said 1 was credibly informed, and it could be proved, 
 that there was an out-and-out sale of the general order business to be made, and 
 as he was a man of position and influence with the administration, I desired his 
 co-operation with me in attempting to prevent it. Senator Doolittle told me he 
 did not like to have anything to do with it at all ; he had understood this gen- 
 eral order business was a perquisite in the hands of the collectors of the different 
 ports, and that they had always been in the habit of using it very much as they 
 saw fit for political or any other purposes. Then he asked me if the general 
 order business was a lucrative business, and I told him I understood it was. I 
 understood it was worth a net profit of from thirty to forty thousand dollars a 
 year to whoever could control it. He replied to me he supposed it was worth 
 quite that, if not something more. Then he told me that Mr. Smythe had been 
 over to Washington, and that he had rendered some service to Mr. Smythe; 
 that they were personally on very friendly terms, and that he felt very much 
 disinclined to do anything that would be displeasing to Mr. Smythe. He said 
 Mr. Smythe had very kindly taken some interest in one of his sons who had 
 been in the army, but was now temporarily residing at Racine; and he told me 
 that arrangements had been made by which his son was to go down and live in 
 the city ; that he was to have an interest in the profits of the general order busi- 
 ness, and that an arrangement had been come to by Mr. Smythe through Mr. 
 Thomson. 
 
 Q. Of the firm of Van Bergen & Co.? 
 
 A. I don't recollect. I don't think he mentioned any names. 
 
 By Mr. Rollins : 
 Q. Do you know who the Thomson is he referred to ? 
 A. No, sir. 
 
 By Mr. Broomall : 
 
 Q. Do you know whether Johnson was connected with the general order 
 business ? 
 
 A. Not to my own personal knowledge; I heard after I came back that he 
 was Mr. Smythe's right-hand outside man. 
 
 By the Chairman : 
 
 Q. Did Mr. Doolittle state the amount he expected his son was to receive 
 from his share ? 
 
 A. I do not recollect. He said it would be a very good arrangement for his 
 son. 
 
 _ (Witness here said what Mr. Doolittle said to him was confidential, and he 
 did not wish to mention it, but the chairman informed him it was not privileged 
 and must be disclosed.) 
 
 Then Mr, Doolittle said to me that Mr. Smythe chose to take an interest in 
 one of his sons to give him a good position out of this general order business, 
 and that it was not a matter he had an interest in. 
 
 Q. Have you any personal acquaintance with Senator Doolittle's son ? 
 
 A. No, sir, not that son ; I know one of his sons, but not the one that is in 
 the position 1 here. He stated to me that his son was then in Racine, but as 
 
100 
 
 NEW YORK CUSTOM-HOUSE. 
 
 soon as the hot weather was over, (we wen: threatened with cholera at the 
 time,) his son was going down to take that position. 
 
 Q. Do yon know whether he did or not ? 
 
 A. I do not know. 
 
 Q. Do yon know whether he was here or not ? 
 
 A. No. He was subsequently appointed to some position in the custom- 
 house. I saw it in the papers. 
 
 Q. Did you ever have any interview with Sinythe himself in regard to the 
 general order business ? 
 
 A. I did not. 
 
 Q. Do you know whether Senator Patterson had any connection with this 
 arrangement with respect to the general order business in New York ? 
 
 A. I remember distinctly having heard, at the time that I went on to Wash- 
 ington, the proportions all these different parties were to have out of the general 
 order business. I heard Patterson was interested in it, and I recollect a state- 
 ment was made of the extent of the interest each was to have, respectively. 
 
 Q. Do you recollect the proportions now ? 
 
 A. I do not. 
 
 Q. Do you recollect who the other parties were ? 
 
 A. Mr. Thomson was one party ; that I got from. Mr. Poolittle, and it wa- 
 the first I knew of* him. Patterson was another; and I have given my deposi- 
 tion in regard to what Mr. Doolittle said about his son. But I cannot remem- 
 ber, really, the extent of the interest jhe various paities were to have. 
 
 New York, Tuesday, December 17, 1866. 
 ABRAM B. MILLER sworn and examined. 
 
 By the Chairman : 
 Q. What is your business 1 
 
 A. I am a warehouseman ; one of the firm of Miller & Conger, doing business 
 at 271 South street. 
 
 Q. Are you acquainted with John P. Stevens ? 
 A. I am not. 
 
 Q. Who are your partners in the storage business ? 
 A. Mr. Conger was the first I was associated with. 
 Q. What interest has each partner in the business ? 
 
 A. Each has half. The real business firm is Miller & Conger. Miller was 
 my father, and Conger is the veritable Conger. 
 Q. Have you the general order business now ? 
 A. W T e have for the upper district. 
 
 Q. Do you know whether Miller & Conger had a business arrangement with 
 Mr. Smythe, whereby they were to have the general order business of the whole 
 city, and pay therefor forty thousand dollars 1 
 
 A. Yes, sir. 
 
 Q. Do you know of an arrangement being made by E. C. Johnson to pay 
 thirty-five per cent, of the profits of the business to Mr. Smythe 1 
 A. I do not. 
 Q. Or any sum 1 
 
 A. No, sir. I can make an explanation. The negotiation in regard to this 
 general order business with Mr. Smythe was conducted by myself. I called at 
 the custom-house. My first interview was with George W. Embree, deputy 
 collector. 
 
NEW YORK CUSTOM-HOUSE. 
 
 101 
 
 By Mr. Broom all : 
 Q. Can you give us the date ? 
 
 A. My impression is it was in the early part of J une 
 
 By the Chairman : 
 Q. What took place at that interview 1 
 
 A. Mr. Embree asked me what the general order business of the port of New 
 York was worth, in my judgment ; in fact, what a man could afford to pay who 
 had the whole business. (When I say the port of New York I embrace Brook- 
 lyn and Hoboken.) It was altogether conjectural with me, or would have to 
 be with any other person, because it would depend on the imports and the 
 amount of business done. After thinking the matter over and considering with 
 Mr. Conger, it was considered that forty thousand dollars might be paid. We 
 thought the risk of paying forty thousand dollars might be assumed, and the 
 offer was made and accepted by Mr. S my the. 
 
 Q. Made by you, personally 1 
 
 A. Yes, sir ; made personally by me. Well, after that the matter was con- 
 cluded, as I supposed, and we set about procuring additional warehouses for the 
 accommodation of the business, for the ones we had were on the East river and 
 too remote from the North river, and not sufficiently large to accommodate the 
 business; aud to do so it became necessary to procure warehouses, especially in 
 the lower part of the city. I conducted all these negotiations myself ; Mr. Con- 
 ger had nothing whatever to do with it, except to advise and instruct as to what 
 should be done. I looked about for such warehouses as I thought would be 
 adapted for the business. Mr. Getty had a very large store in Greenwich street, 
 used for packing pork, and which government has subsequently rented for an 
 examining store ; not that the building was to rent, but because, in point of size 
 and construction, and location, it was well adapted for the business. I walked 
 in and asked Mr. Getty would the building be rented. He was somewhat sur- 
 prised that I walked in without any notice or advertisement. I stated my busi- 
 ness ; that I wanted to rent the store. He remarked, " I might rent the build- 
 ing to a responsible party for a term of years, but I am in negotiation with 
 another party," (not mentioning who that party was,) " and if you will call in 
 a few days" (I don't know whether he stated a particular day or not) " I will 
 be able to give you an answer." I called at the time designated, or within a 
 few days. He said he was not yet prepared to give me an answer. In the 
 mean time, in an interview with the collector, I mentioned to him the premises 
 we thought of getting, (Getty's store.) I called again on Mr. Getty, and he 
 was still unprepared. Seeing the collector again, I said I was unable to get an 
 answer from Mr. Getty, as there was some other party, whose name he was not 
 willing to mention, in treaty for the property. He then remarked to me, " Per- 
 haps I am the person he alludes to ; I applied to him to know what he would 
 take for the building for governmental use, and some weeks ago I submitted the 
 matter to the Secretary of the Treasury, who has made no response, and I do 
 not know whether the government wants it or not." At my next interview 
 with Mr. Getty I told him exactly what Mr. Smythe said. He said it was true, 
 but before he would do anything he would first see Mr. Smythe again. After 
 seeing Mr. Smythe, Getty said he was prepared to rent the building if we 
 could agree on the price. He wanted satisfactory security ; aud the parties 
 met in his office to execute the lease, but, in consequence of the failure to receive 
 permission from Washington to have the store bonded, it was deferred. The 
 first of July was the time that this general order arrangement was expected to 
 come into operation, so far as we were concerned. That time arrived without 
 the permission coming from Washington. It was, therefore, thought best to de- 
 for the execution of the lease until we knew whether government would permit 
 
102 
 
 NEW YORK CUSTOM-HOUSE. 
 
 the stores to bo bonded or not. We were really bound to Mr. Getty, as far as 
 the lease was concerned — that is, if he had seen fit to enforce it. But during 
 the negotiation! Mr. Getty had repeatedly declared he would rather let the 
 property to the government than to any individual or individuals, no matter who 
 they might be — Stewart or Astor ; consequential when he discovered that gov- 
 ernment would probably take his building, he was willing they should have it. 
 and it was owing to that fortunate circumstance we were released from thelea.-e. 
 
 About the first of July, or thereabouts, the collector was not at home ; he 
 went away on Friday to Newport, and did not return until Tuesday morning. 
 Mr. Guthrie was then special agent of the treasury. Feeling very solicitor- in 
 regard to the matter, and knowing we were in peril in regard to this lease, I 
 called on Mr. Guthrie, having been introduced to him some time previous. 
 Having stated the case to him, the arrangements that had been made, and the 
 fact that permission had been sought to make it a bonded store, I asked if he 
 knew anything in regard to the delay of the papers. He told me he had beard 
 nothing directly from Washington, and turned rather acrimoniously and said, 
 "How dare you rent a building the government wants?" 1 said 1 had as good 
 a right to rent the place as the government. He again said acrimoniously ( 
 " Did not you know the government was in treaty for it?" Mr Guthrie had 
 said he had heard nothing directly from Wa.-hingt<m, and after having spoken 
 so acrimoniously, asking me if I did not know the government was in treaty for 
 it, he then said, " It will not be bonded, sir; it will not be bonded ;" and re- 
 peated that several times, but at the same time denying he had any official no- 
 tice of the matter. It was a very remarkable thing all round. In the mean 
 time I wrote to the Secretary of the Treasury, making inquiry about the matter, 
 and why the papers were not signed, but received no response. 
 
 To resume with regard to the finality. It was then concluded best to throw 
 up the whole matter, finding that government was inimical, and that we could 
 get no explan ition. But the stores were not bonded, and we wrote a letter of 
 declination, stating the reasons why we did so. 
 
 By the Chairman : 
 Q. Was the business then taken from your firm ? 
 
 A. It had never been given to us. We had made an arrangement and the 
 stores had been rented to us on parol. The papers had been drawn out, and 
 if the Secretary of the Treasury had accepted, all would have gone on, and we 
 were only released because government would take the building. 
 
 Q Now, then, in regard to the collector. 
 
 A. At the time the arrangement was entered into with the collector he re- 
 served to himself the right, at any time that he considered the public interest 
 demanded, of taking it from us. He likewise made a declaration that not one 
 cent of this $40,000 inured to him, directly or indirectly. That declaration he 
 made at the time. I will now say a word in regard to giving $40,000 for the 
 general order business. If I had secured to me the private bonded warehouse 
 business of New York to-day, with the rates that people must charge to make a 
 living out of it, and which merchants are willing to pay, I would give one hun- 
 dred thousand dollars for it, in the same way that a person would doing business 
 and taking a store and making a hundred thousand dollars a year, if a man came 
 to him and said, "What percentage will you give me to guarantee youS'100,000 
 additional, without risk to yourself?" I would give 75 per cent., and have a 
 large profit secured. We went into this thing in good faith and without an idea 
 of taking advantage of any person. And I must say, since that business was 
 talked of, the general order business has very much fallen off, and as far as our 
 experience goes in the district we have now, embracing a portion of the East 
 river, the business has been so small we would have lost by the arrangement. 
 
NEW YORK CUSTOM-HOUSE. 
 
 103 
 
 Q. Was the general order business taken from Johnson ultimately and as- 
 signed to your firm ? You have stated that you were doing it now. 
 A. The portion we now have was got by an arrangement with Mr. Johnson. 
 Q. How much are you to pay for it 1 
 
 A. When tho arrangement was made we were first asked if we would accept 
 it without any consideration whatever being mentioned. Subsequently Mr. 
 Johnson came and mentioned the matter of thirty-five per cent., and we assented 
 to it. 
 
 Q. Who did Mr. Johnson say that would be paid to ? 
 
 A. He did not say ; he gave me no information. 
 
 Q. What are your business relations with J. & R. Stevens ? 
 
 A. I had not any. 
 
 Q. What are they with Thomson'? 
 
 A. I have none with Thomson. 
 
 Q. And what with Smythe, the collector ? 
 
 A. No business relations with him whatever. 
 
 Q. Do you pay either of them anything ? 
 
 A. No, sir ; not a farthing. 
 
 Q. Commission, salary, or fixed sum ? 
 
 A. Nothing whatever. 
 
 Q. Are you to pay anything ? 
 
 A. I mentioned the thirty-five per cent. 
 
 Q. Are you to pay anything to any person for their benefit ] 
 
 A. No person directly or indirectly. 
 
 Q. Have you any other agreement or understanding with any other person 
 about the general order business ? 
 A. No, sir. 
 
 Q. Has E. 0. Johuson this business since the first of December ? 
 
 A. That I do not know ; Myers & Smith pretend to have it now. We have 
 had no explanation made to us and never asked, because by the terms we re- 
 ceived, it was tendered to us. 
 
 Q. By whom 1 By Johnson ? 
 
 A. Yes, sir. If I had asked for it I could have the whole business of the 
 city. 
 
 ' Q. Do you receive compensation from any person on account of the general 
 order business ? 
 A. No, sir. 
 
 Q. I Rftve one general question : Are there any persons with whom you have 
 agreed, sold, or bargained in reference to this general order business, other than 
 what you have named ? 
 
 A. No. 
 
 Q. Did you tell Deputy Collector Steadwell you had agreed with Johnson 
 that he should share the general order goods business and receive a commission ? 
 
 A. I have no recollection of ever having any conversation with Mr. Steadwell 
 in regard to the matter ; I do not think we ever exchanged a word. 
 
 Q. Do you assume, or do you assume to exercise the right of disposing in 
 any shape, or of selling government patronage in connection with this business 
 or any other 1 
 
 A. I do not. 
 
 t Q- -From whom did you receive Mr. Smythe's letter to the deputy collector 
 directing that officer to send general order goods to your warehouse ? Who 
 sent you the letter, who gave it to you ? 
 A. I never received a letter to that effect. 
 
 Q. Did you ever receive notice of the fact, and if so, from whom ? 
 A. No official notice. The first official intimation we had of it was the receipt 
 of the goods after conversation with Mr. Johnson. 
 
104 
 
 NEW YORK CUSTOM-HOU8E. 
 
 Q. On what terms was tliat authority given ? 
 A. I do not know. 
 
 Q. You had some conversation with Mr. Johnson ? 
 
 A. It was dimply to know whether we would accept of the geo<k without 
 any terms being mentioned. 
 
 Q. Not even the thirty-five per cent. ? 
 A. That was subsequently. 
 
 Q. How came that to come Up afterward.- J Who demanded the thirty-live 
 per cent. ? 
 
 A. Mr. Johnson did not speak of it then, but we had our own Ldeofl about it. 
 There was nothing implied at the time on the part of Mr. .Johnson. 
 
 New York, Tuesday, December 18, 1866. 
 A 13 RAM B. MILLER recalled and examined. 
 
 By the CHAIRMAN : 
 Q. What led to the thirty-live per cent, business ? 
 
 A. Mr. Johnson called on us some time after we had the business, and said he 
 presumed we were aware that money was required for political purposes, and 
 he wished me to pay over to him thirty-live per cent, of the receipts of the store. 
 
 Q. What did tha't lead to ? 
 
 A. We assented to his demand. This conversation was some time after the 
 goods had been sent to us and the business commenced. 
 Q. How much money altogether did you pay him ? 
 A. I cannot tell you now. 
 Q. State what you believe to be the amount. 
 
 A. We paid him, from the 1st of August to the 1st of December, about $r>00. 
 Q. Did you learn from him how this money was to be used 1 
 A. No ; and I have not the slightest idea how, except as a matter of conjec- 
 ture. 
 
 Q. Had you any conversation since the change with Mr. Myers about these 
 
 matters ? 
 
 A. Mr. Myers called at our place about ten days ago and told us that their 
 firm — Myers &: Smith — had the entire general order business. This was the 
 first intimation we had that there had been a change, and that Mr. Johnson was 
 displaced. He said they would continue the matter with us during the present 
 month, at all events. 
 
 Q. Did he say on the same terms ? 
 
 A. Yes ; he said he could pay over to Mr. Johnson the same as before ; and 
 he also said that, if they did not take a warehouse on the east side of the town 
 in order to transact the business themselves, he would come over to see us the 
 1st of January to make an arrangement with us. 
 
 Q. Did he say anything about money being necessary for certain business ? 
 
 A. No ; he did not allude to it at all. 
 
 Q. Have you any other knowledge of the sale or letting out for a considera- 
 tion of the storage business or the cartage and lighterage ? 
 
 A. I have not. The cartage and lighterage were suggested to me. 
 Q. By whom? 
 
 A. By the deputy collector ; and I am not sure whether the collector men- 
 tioned it or not. But the matter was suggested to me that the person having 
 the general order business could manage the cartage business better than any 
 other persons. Thinking we were to have the whole general order business, 
 and that that would be as much as we could attend to, we declined attending to 
 the suggestions we received about the cartage business. 
 
NEW YORK CUSTOM-HOUSE. 
 
 105 
 
 Q. Was anything said about a consideration for the cartage ? 
 A. Nothing definite took place, as far as I was concerned ; the conversation 
 was informal. 
 
 Q. They were inviting a bid from you 1 
 
 A. Yes ; you may so regard it ; or it might be with a view of obtaining any 
 information I might have on the subject which would guide them in making 
 arrangements with other parties. 
 
 Q. Was this in reference to the cartage alone ? Was the lighterage men- 
 tioned ? 
 
 A. The lighterage was suggested also. 
 
 Q. What were the qualifications of the storekeeper who was sent to your 
 store to take the place of the storekeeper who was discharged ? and what was 
 his name ? 
 
 A. I don't know which storekeeper you allude to. 
 Q. I allude to the one who was last employed. 
 
 A. He was only there a day or two. He was a gentleman who had formerly 
 been extensively engaged in business, but he had no experience in warehouse 
 business. At the time he came to our place we were very busy, and it required 
 an expert person to discharge the duties of our place. 
 
 Q. Was his name Moody ? 
 
 A. No ; that was the name of another man who was removed, but who was 
 a competent officer. 
 
 Q. Were his qualifications good ? 
 A. They were very good. 
 
 Q. Were there any complaints made against him 1 
 A. Not that I am aware of. 
 Q. Do you know what he was removed for ? 
 A. I do not. 
 
 Q. You say he was a good officer 1 
 
 A. Yes ; he discharged his duties to our entire satisfaction. 
 
 ALFRED H. PRATT sworn and examined. 
 
 By the Chairman : 
 Q. State your residence and place of business. 
 
 A. I live at No. 11 Park avenue, New York ; my place of business is with 
 A. T. Stewart & Co. 
 
 Q. Are you the broker of that firm 1 
 
 A. No, sir ; they employ no brokers. I have charge of all his custom-house 
 business. 
 
 Q. Do you know anything about the arrangement by which Messrs. Miller 
 & Conger were to take the entire general order storage business and pay forty 
 thousand dollars for it ? 
 
 A. I know nothing personally ; only common rumor at the time. At the 
 time, or directly after, Mr. Smythe came in, there were a great many interested 
 and expected to get it. Messrs. Humphrey & Bixby held it a good many 
 years, and the general opinion was that they made a great deal of money. 
 They were prepared, as I understood, to give $100,000 for it. 
 
 Q. From whom did you get your information about the Miller & Conger ar- 
 rangement ? 
 
 A. I never knew anything about them directly. I knew they tried very 
 hard. My understanding was that that man Thomson had the selling of it, 
 and either sold it to them or expected to sell it to them. They anticipated 
 taking the Bank street stores that Smith & Myers got. Had they obtained 
 that, I suppose the thing would have turned out entirely different. At the time, 
 
IOC 
 
 NEW YORK CUSTOM-HOUSE, 
 
 I know that our own man, whom we ,-cnt around to the bonded warehouses, -aid 
 Miller & Conger were going to have the store. 
 
 Q. Did you understand that Messrs. Miller & Conge r were to pay 840,000, 
 or any other sum, for the business ? 
 
 A. I did not understand who was to pay it; bat, at, the time, this memoran- 
 dum was handed to me: 
 
 " George F. Thomson, late of the Daily News and Fort Lafayette. . . $5, 000 
 
 Van Bergen, lawyer, and brother-in-law of the collector 10, 000 
 
 Patterson, senator from Tennessee, and son-in-law of Johnson $. 000 
 
 A woman 3, 000 
 
 Political fund 10, 000 
 
 E 2,000" 
 
 I sent it at the time to Mi. McCulloch, with certain vague information that J 
 had. Mr. Draper gave me that before he died. 1 think shortly after this w mt 
 on to Mr. McCulloch this Miller cV Conger business was broken up, and a new 
 negotiation was made. That is my impression. 
 
 Q. Did you got any reply from the Secretary ? 
 
 A. Nothing in particular. I have been in the habit of corresponding with 
 him. He is a relative, and I have known him a great many years. Among his 
 correspondence he might have spoken of it. I think he did say it was a sub- 
 ject that had engaged his attention, and said he hoped it would be satisfactorily 
 arranged, or something of that sort. 
 
 Q. What do you estimate the value of the entire general order business per 
 annum, with the privilege of charging such storage as has recently been 
 charged ? 
 
 A. O, it is almost impossible to tell; a great deal of money — $150,000 at 
 the least calculation. The charges under the general order business are twice 
 as great as the usual rates of storage in bonded warehouses. 
 
 Q. State whether you ever had any conversation with Mr. S my the about 
 any of these arrangements of the general order business. 
 
 A. No, sir; I think not. I had a conversation with Mr. Thomson, in which 
 I indulged in some pretty severe remarks, that that thing should be peddled 
 out in the business community, and accused him of being the recipient of a large 
 sum of money. He did not deny it. 
 
 Q. Did you state to him who else ? 
 
 A. My remarks were pretty general. 
 
 New York, January 16, 1S67. 
 THOMAS B. ASTEN sworn and examined. 
 
 By the Chairman: 
 Q. Are you a warehouse-man under Collector Smythe ? 
 A. I am. 
 
 Q. How long have you been employed in the custom-house'? 
 
 A. About fourteen months. I was appointed in September, 1S65. 
 
 Q. By whom were you appointed? 
 
 A. By Preston King. 
 
 Q. Do you know E. C. Johnson ? 
 
 A. Yes. 
 
 Q. Did you ever hear him say he paid, or was to pay, any sum of money for 
 the general order business 1 
 
 A. No, sir; I don't think I have. 
 
 Q. Did you ever hear him say anything like that? 
 
NEW YORK CUSTOM-HOUSE 
 
 107 
 
 A. I heard him say that others said so ; but he never said whether he did or 
 not. 
 
 Q. What is your impression, from what you have heard him say ? 
 A. My impression is that he must have paid some way. 
 Q. You do not recollect distinctly what he did say ? 
 A. No. 
 
 Q. Did you ever hear him say that he offered Mr. S my the $50,000 or some 
 such sum for it? 
 A. No. 
 
 Q. Or any other sum ? 
 A. No. 
 
 Q. For that business, or any portion of it 1 
 A. No. 
 
 Q. Or that he offered anything to any one else ? 
 
 A. No ; he talks a great deal, but I don't recollect distinctly what he said ; 
 but I think if he said anything like that, I would recollect it. 
 Q. Do you know Edwards, Atkins & Co.? 
 A. I know one of the firm. 
 
 Q. Did you ever hear him say they paid, or expected to pay, or were asked 
 to pay, any money for the general order business ? 
 A. No. 
 
 Q. Did you ever hear either of them or both of them say they paid, or expected 
 to pay, or were asked to pay, Mr. Thomson, Mr. Smythe, or any other person 
 for that business ? 
 
 A. No. 
 
 Q. Did you hear Johnson say that Mr. Smythe could make money out of 
 the general order business, or words to that effect? 
 A. No. 
 
 Q. Did your hear Johnson say he paid or agreed to pay, for or on account of 
 his receiving the general order business, any amount ? 
 A. No, I did not. 
 
 Q. Did you ever state anywhere that Mr. Johnson told you so ; or did you 
 state anything in reference to this general order business? 
 
 A. Not to my recollection. I may have stated that he was going to have the 
 business, or something of that kind. He talked that way himself, and I might 
 possibly have repeated it. 
 
 Q. Do you know a government transfer carman named Keyes ? 
 
 A. I do. 
 
 Q. Did you ever hear him say that he had agreed to pay any money or other 
 valuable consideration for the cartage of imported merchandise? 
 A. No. 
 
 Q. Did you ever hear any one say that ? 
 A. No. 
 
 Q. Did you ever hear any person or persons say they had to pay anything 
 to get the cartage ? 
 
 A. No. Mr. Keyes was an applicant for it under Mr. King; but he received 
 his appointment under Mr. Smythe. 
 
 Q. Have you received any money by loan or otherwise from Johnson ? 
 A. No. 
 
 Q. From Edwards, Atkins & Co., or from Miller, or from Keyes ? 
 
 A. No. I will state in regard to Mr. Johnson that he lives in my neighborhood, 
 and sometimes he has been invited to, and contributed at our meetings ; he is 
 a member of our executive committee. I have never received any money from 
 him, except in that way ; but I know he subscribed some money to our organi- 
 zation. 
 
108 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. It has been stated that places were sold under your control, in one in- 
 stance $100 was paid for one? 
 
 A. I will state that Mr. Livingston, who reside- in my neighborhood, came in 
 while the men were subscribing for political purposes on the 29th of October 
 last, just previous to the State election, and he subscribed $100. I had an 
 unpleasant task to perform that day, as they had given me a paper on which 
 the various employes were to be let subscribe for political purposes. When I 
 got this .$100, I thought as it came from a man whom 1 knew to be a repub- 
 lican, it should not go in the same direction as the rest of the subscriptions. So 
 I went to Mr. Smythe's house that evening and asked his permission to give 
 this money to the republican committee. His reply was, he did not care about 
 what was done with it; to do what 1 pleased with it. On the following morning, 
 the 30th October, I enclosed it to Mr. James Kelly, the treasurer of the committee, 
 and he acknowledged the receipt of it, which receipt I have. As to the man 
 being appointed, there was no c msideration of that kind had anything to do 
 with his appointment. I will here state there have been a hundred men removed 
 under me since I have been in the custom-house. 
 
 Q. Was there an order issued last fall in reference to this cartage business ? 
 
 A. Yes. 
 
 Q. At whose suggestion was that order issued I 
 A. I think it was at my suggestion. 
 Q. For what reasons ? 
 
 A. The reasons were : first, we had great confusion, from the fact that the mer- 
 chants' carmen who transferred the goods did not understand writing proper 
 receipts — in some cases boys were employed. The second reason w.ts that ap- 
 plications would be made to transfer goods from one warehouse to another. The 
 day following, or a few days after, parties would call to see our books, and our 
 books would show the goods had been transferred when they might not be for 
 a week after, as the merchants would retain the order, and transfer them when 
 they wished. 
 
 Q. Who appoints these government carmen ? 
 
 A. The collector of the port. 
 
 Q. When was Keyes appointed i 
 
 A. Not very long after Mr. Smythe came into office. 
 
 Q. Had you any conversation with him before you made this suggestion to 
 Mr. Smythe? 
 
 A. I had. He said this confusion could be avoided, and that if he had the 
 entire control of the cartage he would be entirely responsible for it. Where 
 there was a case mislaid or lost it was difficult to say whether it was lost or 
 mislaid by the government carmen, or the merchants' carmen. And Keyes said 
 if he had the entire control he would take the entire responsibility, and the 
 merchants could look to him for any of their goods that were mislaid. 
 
 JOHN A. COOKS sworn and examined. 
 By the Chairman: 
 
 Q. How long have you been connected with the custom-house ? 
 A. My appointment was dated the 3d of July. 
 Q. Do you have the supervision of the labor employed there ? 
 A. Yes, sir. 
 
 Q. In the appraiser's department? 
 
 A. I have nothing to do with the appraiser's department. 
 Q. You keep the time in the storekeeper's department 1 
 
 A. Yes; but not in the appraiser's department. That is a separate depart- 
 ment. 
 
 Q. Who has charge of the labor in the appraiser's department? 
 
NEW YORK CUSTOM-HOUSE. 
 
 109 
 
 A. Colonel Barstow. 
 
 Q. Can you state from your book or otherwise the amount of wages paid for 
 labor for the month of July? 
 
 A. I think it was about $12,000. I speak from memory. 
 Q. Do you recollect the number of men? 
 A. About one hundred and fifty. 
 
 Q. How would that average for August and September ? 
 A. There was a gradual increase of men. Our roll for the month of Novem - 
 ber was about $16,000. 
 
 Q. This pay-roll of $16,000 does not embrace the appraiser's store? 
 A. No, sir 
 
 Q. Then in the storekeeper's department proper, the amount paid for No- 
 vember is about $16,000? 
 
 A. Yes, sir; that includes laborers, watchmen, &c. 
 
 Q. What are the number of employes to whom that was paid in the month 
 of November? 
 
 A. It must have been nearly two hundred. 
 
 Q. Do you recollect, when the labor-roll was divided, about the proportion 
 that went into the appraiser's department, and does not that appear on your 
 records ? 
 
 A. I don't remember how many. It did not lessen our labor very much. 
 By this reorganization of the appraiser's department we had as much labor to 
 perform as before. We furnish the goods to the appraiser's department, and 
 they return them again to us. We have to handle those goods so that it is not 
 necessary to reduce the number on our pay-roll. 
 
 Q. Do you recollect the number of men that Mr. McElrath took from the ap- 
 praiser's department when the division was made? 
 
 A. No, sir; there are some months when the business requires a much larger 
 force than at others, and we cannot tell when it is to occur. We are now re- 
 ducing the force ; commenced last week. We have on our pay-roll more 
 than eighty soldiers; and this pay-roll could be very much reduced if it could 
 be taken away from the politicians. The pressure upon the collector and upon 
 myself is perfectly immense from members of Congress and politicians. I pre- 
 sume I have received four or five hundred letters since I have been storekeeper 
 for laborer's positions alone, and in reducing a force it is a difficult matter to 
 make the selections. If the demands of politicians and public officers must be 
 allowed there must necessarily be thirty or forty men on hand more than we 
 have any use for. That is one reaeoo why our force is larger than necessary. 
 
 Q. What is the tenure of office — for how long are they engaged? 
 
 A. No particular time. They are taken on the force and discharged at our 
 option. 
 
 Q. Is there any difficulty at any time in obtaining any amount of help you 
 wish in twenty -four hours' notice? 
 A. None whatever. 
 Q. Who appointed Colonel Barstow ? 
 
 A. Mr. McElrath, with the approval of the Secretary of the Treasury, I 
 think. 
 
 Q. He was on General Dix's staff? 
 A. Yes, sir. 
 
 WILSON BARSTOW sworn and examined. 
 By the Chairman : 
 
 Q. Are you connected with the custom-house here ? If so, in what capacity ? 
 A. Yes, sir ; 1 have been assistant appraiser since the first of September. I 
 have charge of the " openers and packers." 
 
110 
 
 NEW YORK CUSTOM-HOUSE 
 
 Q. Do you recollect the number of men or what proportion of force the ap- 
 praisers' department took from the storekeeper.- at the time of tie re i U tilization 
 in September ? 
 
 A. About the same number of nu n that were in the storekeeper's department. 
 We have now eighty-nine men. We ha 1 eighty with them. 
 Q. Have you discharged any lately \ 
 
 A. We have discharged a few for inefficiency, not for want of work. 
 
 Q. What did your pay-roll for November amount to ? 
 
 A. One thousmd dollars. 
 
 Q. In October ? 
 
 A. About the same. 
 
 Q. In September ? 
 
 A. It did not vary more than three hundred dollars. This month we have 
 eight or nine men more than last montV 
 Q. Is this your busiest season ? 
 A. No, it is not. 
 Q. Why that increase ? 
 
 A. We are not full even QOW. We have not our complement. Each examiner 
 is allowed three openers and packers. It lias not been necessary to keep up that 
 force. Some of the examiners examined the goods — outside examinations which 
 do not require men to open and b >x up goods. 
 
 Q. Are you working your full force now ? 
 
 A. Yes, sir; we cannot always tell what moment we may want more or less 
 men. Goods come in sometimes very rapidly, and other times slack up for two 
 or three weeks. These men are appointed by the Secretary of the Treasury. 
 
 Q. Have you anything to do with the damage bureau ? 
 
 A. Yes, sir, I have charge of it. 
 
 Q. What classes of goods are brought before you? 
 
 A. All classes; every kind that is imported and liable to damage. 
 
 JAMES R. ALLIBAN sworn and examined. 
 By the Chairman : 
 
 Q. Please state your business and place of business. 
 
 A. I am United States weigher in the custom-house at the present time. 
 
 Q. How long have you occupied that position ? 
 
 A. From May, 1861, until August, 1864. I was then made United States 
 public storekeeper. 
 
 Q. How long have you held that position 1 
 
 A. Since August 1, 1864, to July 1, 1866, when I was re-appointed weigher. 
 Q. How many men were employed in that department ? 
 
 A. When I took charge of the public stores after the reorganization I found 
 140 men there, but the order of things allowed only about 120, and they were 
 reduced to that number — it being fixed by the Secretary of the Treasury. 
 
 Q. Was that number sufficient to perform the duties ? 
 
 A. That number of men was sufficient to perform the labor in the appraiser's 
 and the storekeeper's departments — in both departments. The labor was then 
 all under the direction of the storekeeper. It is different now. They per- 
 formed all the labor until the spring of 1865, when the business had increased 
 considerably, and the cellar basements were brought into use, and ten additional 
 men w r ere employed. Subsequent to that ten more men were put on, in conse- 
 quence of heavy importations, making 140 men. Subsequent to that an order 
 was made to put on twenty-four additional men, if necessary, and continue them 
 as long as necessary. About sixteen or eighteen men were put on, which, 
 about the time I left, were reduced to about four or five. There w T ere about 
 
NEW YORK CUSTOM-HOUSE. Ill 
 
 140 or 150 laborers doing the work when I left the department. 1 left it about 
 the* 1st of July, before the new law went into effect. 
 
 Q. Under the new organization would as many men be needed in the store- 
 keeper's department % 
 
 A. No, sir. 
 
 Q. The services of how large a percentage could be disposed of after the 
 change ? 
 
 A. About one-half of the men. 
 
 Q. Were 150 men employed when you left 1 
 
 A. Yes. They did all the duty in both departments. 
 
 Q. Would a hundred men be sufficient to do the work in the storekeeper's 
 department 1 
 
 A. Less than that. 
 
 Q. What are the facts as to the number of men employed there ? 
 A. I know of nothing except by report. In my judgment, from seventy- 
 live to a hundred men w r ould be sufficient to do the labor there. 
 Q. W T hat do you mean by laborers in the appraiser's department ? 
 A. The openers and packers. 
 Q. Did you have charge of all these laborers 1 
 A. Y~es, sir. 
 
 Q. How many men were usually employed in the appraiser's department 
 while you were there ? 
 
 A . Fully one-half. They acted as openers and packers. 
 
 Q. Were those men who were detailed for that duty employed exclusively 
 in the appraiser's department, or also in the storekeeper's department 1 
 
 A. Some were employed exclusively in the appraiser's department, and some 
 were used in both departments. They were used as the exigencies of the ser- 
 vice required. *' 
 
 New York, Thursday, November 22, 1866. 
 JOHN T. HOGEBOOM sworn and examined. 
 
 By the Chairman : 
 Q. Are you connected with the custom-house in this city 1 
 A. Yes, sir. 
 Q. In what capacity ? 
 
 A. I was appointed in 1861, local appraiser. I have been about three years 
 general appraiser. 
 
 Q. In the discharge of your duties as general appraiser has the matter of 
 the invoices of wines, liquors, &c, received your special attention ; and if so, 
 what is the usage with reference to inland charges on exports from the interior 
 to the port of shipment ; and if there has been a charge, what was it 1 
 
 A. The old law made all inland charges dutiable, and for a while the depart- 
 ment required coastwise charges to be dutiable. The courts, however, set aside 
 that. The distinction between values and charges was never very carefully 
 drawn under the old law, for the reason that all charges being dutiable accord- 
 ing to the tariff that was attached to the specified article, it was very little 
 difference what was called charges and what was called value. The usage, of 
 course, was, in the administration of the customs, to have all those charges, as 
 nearly as they could be ascertained, added to the value either directly or in the 
 invoices noted as charges ; and where they were not so put in the invoices, 
 they were added by the clerks in the appraiser's office, and were always a mat- 
 ter of appraisement until the law was changed in the statute of 18G5, which 
 abolished all charges and they ceased to be dutiable. Then the question was, 
 
112 
 
 NEW YORK CUSTOM-HOUSE. 
 
 of course, distinctly presented as to what were charges and what were not, 
 what really entered into the value of the goods, and what was regarded If 
 charges ; and it was in that light that the question was fully discussed by my- 
 self as to what should be really regarded as a charge and what should be 
 regarded as an element of value. That has been a mooted question to a consid- 
 erable extent, so much so that Congress, approaching the subject from a differ- 
 ent stand-point to that from which the department had approached it, has 
 restored charges again at its last session and made them dutiable, besides 
 making an additional provision in the law that where charges were not added 
 in the invoices, and where by the addition of the charges the gross value 
 of the goods, together with the charges, should be advanced ten per cent., they 
 should be subject, like an increase of valuation on the article itself*, to the penalty 
 of twenty per cent. 
 
 Q. What is your impression as to the expediency of that change by Con- 
 gress ? 
 
 A. It had been a difficult and complicated question as to what was dutiable 
 and what was not. Jt was a question which encumbered commerce very much. 
 An honest m reliant might very well reason with himself whether he ought t<> 
 add such and such charges or not. Consequently it produced an uncertainty Si 
 to the entering of goods. However, after charge.-? were abolished and the sub- 
 ject was adjudicated, and we had acted under it, it is my opinion that the other 
 change which was made by the subsequent statute was more unfortunate than 
 the first. What is of the highest importance in our customs law is uniformity; 
 for many of the men engaged in commerce are men who do not want to consult 
 the statutes it they can help it, nor employ lawyers. The necessity of employing 
 lawyers to advise them as to their rights and manner of doing busine.-.- is very 
 expensive. If the law be simple and plain a good merchant can understand it, 
 and can make it his business to conform to the law, so that there would be less 
 excuse for violating the law ; and especially as a protection against the violation 
 of the law, the understanding of it is a matter of importance. It furnishes less 
 excuse for its violation. The change of the law has practically led to its viola- 
 tion to a considerable extent, much of which we had reason to suppose v. 
 intentional. The old custom, when charges were dutiable, was for the merchant, 
 in invoicing his liquor or wines, to make each statement specific — his wines cost- 
 ing so much, his casks so much, (if they were put in casks,) and so much if they 
 were recasked with outward casking, as some of the valuable liquors and wines 
 are. If the wine or liquor was cased, the expenses of casing, bottling, &c , 
 were added in separate items in the invoices. This practice was encouraged 
 rather than discouraged, because it presented the items of the invoice, and it 
 could be more easily analyzed by the officers of the customs. When the law 
 was passed abolishing charges, there was a general tendency on the part of mer- 
 chants to restrict the value expressed in their invoices to the simple article of 
 the wine or liquor, excluding all other charges or expenses connected with it. 
 That was the law of 1865. Xow the point that was at once necessarily raised 
 was, what was really a part of the value of the article as an element of value, 
 and what should be regarded as charges. The department, after a careful ex- 
 amination of it and of the opinions of the officers of the customs presented to 
 it, decided that all expenses or charges that had been heretofore called charges 
 and that were incident to the article in the general market of the country from 
 which it was exported, were to be regarded as a part of the value, such as land 
 carriage, inland transportation, outwaid casings, extra casing for dry goods, &c. 
 I could refer you to a case deciding that principle, not only in reference to the 
 casking and casing and bottling of liquor, but with reference to the boxing of 
 oranges, in which it was decided that that boxing entered into the element of 
 the value of oranges in the market. So cartoons, into which silk is put, should 
 be regarded as an element of the value of the article itself. The commerce of 
 
NEW YOEK CUSTOM-HOUSE. 
 
 113 
 
 New York has conformed to that decision of the department perhaps before the 
 decision of the department was made. My position as general appraiser was 
 very active in that matter ; and to that, I suppose, was due the belief of the 
 merchants that that should be the custom, and they conformed their entries ac- 
 cordingly. The department, however, decided that, in view t)f the uncertainty 
 of the question, they would permit all cases where an addition of value beyond 
 ten per cent, was occasioned to be relieved from liability, without penalty, on 
 twenty per ceut., which would have fallen under the statute. 
 
 Q. I want to know whether the inland charges of wine — say from Reims to 
 Havre — are dutiable. 
 
 A. Previous to the law being altered those charges were dutiable, and had to 
 be added to the invoices, and the collector was required to take duty on those 
 charges. That was previous to 1865. Since the law of 1865 went into effect 
 inland charges on the way to the port of exportation cannot be considered as an 
 element of value, and, of course, are not dutiable. 
 
 Q. Did that construction obtain to the best of your knowledge in the different 
 parts of the Unted States ? 
 
 A. 0, yes; clearly. The question which the abolishing of the statute raised 
 was how much of the charges should be transferred as an element of value. 
 Clearly the transportation cannot be regarded as an element of value. 
 
 Washington, December 11, 1866. 
 
 EDWARD JORDAN recalled. 
 
 By the Chairman : 
 
 Q. Do you desire to make any correction of the statement you made when 
 you were last under examination before the committee, in answer to the question 
 when your acquaintance with Mr. Farwell first commenced % 
 
 A. I see from a memorandum which a clerk in my office has prepared to be 
 submitted to the committee in connection with the papers relating to the agency 
 of Messrs. Farwell and Gibbs abroad, and to the action of my office in relation to 
 frauds generally, that I had met Mr. Farwell in New York in March, 1864, and 
 had communicated to him at that time the fact that the government was receiv- 
 ing from its agents abroad evidences of fraud. I wish to say, in addition to 
 that, that I have now no recollection of having met Mr. Farwell at that time, 
 but I presume I did, from finding this memorandum here, which I suppose is 
 made from papers in my office, as I do not know from what other source my 
 clerk could have derived his information. I have not had time to look over this 
 memorandum until I came into the committee-room this morning. On glancing 
 over it, I find that stated, and I suppose it is true, but I have forgotten all about 
 it. I have no recollection of it now. That is all I care to say on that subject. 
 
 Q. You were recalled principally for the purpose of asking you whether the 
 instructions given to the special agents of the treasury, Mr. Farwell and Mr. 
 Gibbs, in Europe, issued from your office ; and if so, whether, among other things, 
 they suggest or advise that collectors in this country will be instructed to make 
 seizures of importations from Europe on the suggestions of these special agents :. 
 whether that has ever occurred, whether it is general, whether there are such 
 instructions, or whether there has been any specific case of the kind % If so, 
 state the circumstances. 
 
 A. In response to that inquiry I will say that the instructions to those agents 
 do proceed from my office. 
 
 Q. When were those agents appointed, and did their appointments en:anate 
 from your office ? 
 
 H. Rep. Com. 30 8 
 
114 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. The appointment does not emanate from my office ; the appointment is 
 made by the Secretary of the Treasury. 
 Q. At the suggestion of your office '. 
 
 A. Yes ; these Jwo appointments were made at my suggestion. 
 Q. When were these appointments made ? 
 
 A. Mr. (iibbs was appointed in tin* month of March, lie being the first 
 
 agent. His instructions are dated the 18th day of that month. 1 hold in my 
 hand a draught of the instructions, and will read it to the committee. 
 
 The paper was read by the witness, and is as follows: 
 
 Treasury Department, Solicitor's Office, 
 
 March 18, 1863. 
 
 Sir: Your appointment as revenue agent, Under the act for the prevention of 
 frauds, was made with the view of employing you in making inquiries in some 
 of the principal countri s from whence dutiable merchandise is imported into the 
 United States. Those inquiries must, of course, have for their object, the dis- 
 covery of the various methods by which fraud- are committed upon the custom 
 revenues of the United States ; of the parties engaged in such frauds ; and of 
 particular instances of their commission; and in the collection of evidence by 
 by which they may be proved. 
 
 In order to fit yourself for the prosecution of these inquiries with effect, it 
 will be necessary that you become familiar with the kinds of merchandise im- 
 ported from the various countries and regions which you will visit; the prices 
 at which such merchandise has been entered at the custom-houses in this coun- 
 try; the manner in which such entries are made, and many other facts which 
 can only be learned at the custom-houses themselves. Several weeks, if not 
 months, will be required for the acquisition of this information, during which 
 you will probably be required to visit the custom-houses in several of our prin- 
 cipal ports. At present your inquiries will be confined to the port of New 
 York. 
 
 You will therefore proceed at once to that city and enter upon the investiga- 
 tions which I have indicated. I do not deem it important to give you any 
 special instructions as to the manner in which they shall be conducted. Your 
 own judgment will, doubtless, be a sufficient guide. It is proper, however, to 
 remark that the countries in which you will be employed are the British islands 
 and those countries of continental Europe from which our principal importations 
 are made. You will, of course, confer with the local revenue officers, who will, 
 I doubt not, be ready to afford you any aid in their power. I trust that your 
 examinations will be diligent and thorough, and that they will redound to the 
 advantage of the country. 
 
 Y T ou will, from time to time, advise me of the progress you make; and should 
 it be necessary, you will apply to me freely for instructions or aid. 
 Respectfully and truly, 
 
 EDWARD JORDAX, Solicitor. 
 Montgomery Gibbs. Esq., Revenue Agent. 
 
 Q. Have the powers and discretion invested in these agents by the Secretary 
 been enlarged or greatly modified ? 
 
 A. I think not. I have also here, and will read, the instructions that were 
 given to Mr. Gibbs. 
 
 The paper w T as read and is as follows : 
 
 Treasury Department, 
 
 Solicitor's Office, July 16, 1863. 
 Sir: Having completed the examination and inquiries preparatory to your 
 departure for Europe as special ageut for this department for the detection of 
 
NEW YORK CUSTOM-HOUSE. 
 
 115 
 
 frauds upon the revenue, you will, as soon as practicable, proceed to Europe 
 and enter upon the discharge of the duties required of you there. 
 
 You will visit the countries and ports with which the United States have the 
 most extensive commercial intercourse, and will there make such investigations 
 and inquiries as may be necessary and practicable to detect any frauds upon the 
 revenue of the United States which may have been committed in the past, or to 
 prevent any which may be contemplated in the future. 
 
 For this purpose you will ascertain, as far as practicable, what have been the 
 market prices of the various commodities imported from the places visited by 
 you into the United States, and compare them, so far as you may have the 
 means of doing so, with the prices at which those commodities have been actu- 
 ally entered on their arrival here, or with the prices indicated by the invoices 
 deposited with the consuls of the United States, as the case may be. 
 
 You will call upon the various consuls and commercial agents of the countries 
 and places visited by you and examine the invoices deposited with them, and 
 will use your best efforts to enlist their interest and hearty co-operation in the 
 efforts of the department for the suppression of frauds. 
 
 You will collect all the information and evidence which it may be in your 
 power to obtain and which may be useful in furthering the general object of 
 your appointment, and will transmit it to this office in such form as will render 
 it most available for the end in view. 
 
 You will be expected to make reports as often as once a month, detailing your 
 operations and progress. 
 
 The Secretary of State will be requested to furnish you with a letter request- 
 ing ail the functionaries of the government resident abroad, and who are under 
 the direction of the State Department, to afford you any assistance in the per- 
 formance of your duties which may be in their power. 
 
 I am instructed by the Secretary of the Treasury to say that the mode of 
 meeting your expenses indicated in the letter notifying you of your appoint- 
 ment will be so far modified that your actual necessary expenses will be paid, 
 of which you will therefore keep an account. 
 Respectfully and truly. 
 
 EDWARD JORDAN, 
 
 Solicitor of the Treasury. 
 Montgomery Gibbs, Esq., Agent of the Revenue. 
 
 Q. Has Mr. Gibbs since that time acted under those instructions? 
 
 A. So far as I kuow, he has. I will say in addition to that, that these were 
 the instructions to Mr. Gibbs, without any modification that I now remember. 
 If there has been any modification it will be shown by the correspondence in 
 my office, which is at the disposal of the committee, and which I will take pleas- 
 ure in submitting to its inspection. This continued so for a considerable length 
 of time, when it was ascertained that by the suggestion of Mr. Gibbs our consuls 
 in various places in Europe had adopted the rule of requiring parties who ex- 
 hibited their invoices to furnish samples of the merchandise embraced in the 
 invoices. I will explain here the reason why that measure was resorted to. 
 The law of 1S63, inaugurating the entire system with a view to the suppression 
 of frauds, provided as one of its main appliances that consignors of merchandise 
 should make their invoices in triplicate ; that they should file one part with the 
 consul of the United States nearest to the place from where the shipment was 
 made, transmit one to the collector of the port at which the merchandise was 
 intended to be entered, the other part of the invoice to be at the disposal of the 
 merchant himself. At the time the law was drawn it was supposed that that 
 would place it in the power of the government to learn definitely as to whether 
 these invoices were fairly or fraudulently made. It was supposed that by taking 
 the invoices at the various consulates and making inquiries in the markets of 
 
lie 
 
 NEW YORK CUSTOM-HOUSE. 
 
 the country it could bo ascertained whether the prices were true or false. But 
 experience showed that that expectation was unfounded; that the invoice- were 
 made so general in their terms that they described nothing, and nobody could 
 tell by them to What they related. No doubt they were made in thai general 
 way to cover frauds. Indeed 1 know that they were in a great many instance.-, 
 and the committee will have no difficulty in coming to the same conclusion it' it 
 will go to one of our custom-houses and inspect the invoices on file there. The 
 committee will see that these invoices were made so general, that in point of 
 fact no one could tell to what goods they related, and that goods worth one 
 price and goods worth four times or six times as much all came within one 
 description. Mr. Gibbs, supposing that a law which was in fact repealed by 
 implication by the act of 1 M>.'>, giving to the consuls tin; power and imposing on 
 them the duty of ascertaining for themselves whether an invoice was correctly 
 made or not, and authorizing the requirement of samples, advised the consuls 
 to require these parties, in cases where it was entirely convenient for them, to 
 furnish sample's. There are hundreds of cases where it is convenient and where 
 no prejudice can result t<» anybody from furnishing them if the importer is an 
 honest man; but if he wants to cover frauds, as a matter of course, it will preju- 
 dice him. Outcry was made at once, and the State Department was advised of 
 the complaints on that score. The subject was brought to my attention, and I 
 at once told the Secretary of the Treasury, who referred the matter to me, 
 that although in my judgment it was a veiy desirable and important thing, yet 
 there was in my judgment no law that authorized making requirements of this 
 sort, and then instructions were given to discontinue this custom. It was dis- 
 continued in consequence, but at the next session of Congress the Secretary of 
 the Treasury at in}- suggestion asked from Congress authority to enable consuls 
 to require samples to be delivered. That authority was given. Regulations 
 were made accordingly, and since that time samples have been required; and 
 now the government is in position to detect any fraudulent undervaluation of 
 merchandise which from its nature may be sampled, and which accordingly is 
 sampled with those consuls who do their duty. I am not aware that Mr. Gibbs's 
 instructions have been modified in any other particular, although it is bandy 
 possible that special instructions may have been given in regard to some other 
 matters. If so, they will be submitted to the committee. 
 
 Q. I wish to direct your attention to the general question in reference to in- 
 structions to collectors. 
 
 A. Before I go to that, it is perhaps well enough for me to speak in regard 
 to Mr. Farwell. His appointment took place much later than Mr. Gibbs's, and 
 it was in consequence of those views entertained by myself. The committee 
 will perceive when it comes to examine this pile of papers, if it ever does so, 
 why this system of measure was first entered upon. I suggested to the Secre- 
 tary of the Treasury that it was a new thing — that its results were therefore not 
 certain — that I thought it would be inexpedient to enter wholesale upon its 
 execution at once — that the department had better feel its way — that 1 thought 
 therefore that the appointment of one agent for the time being would meet all 
 that was advisable, and then the appointment of more agents might be made de- 
 pendent upon the results following from the appointment of this one. Mr. Gibbs 
 was the first agent. He was appointed because he had first made the sugges- 
 tion, and had first brought the knowledge and attention of the department to 
 this wholesale system of frauds.. He had made it a subject of study and had 
 aided in the preparation of the bill, and in my judgment was entitled, from what 
 he had done, to the appointment. 
 
 By Mr. Rolllns : 
 
 Q. What had been his position prior to his being selected to go abroad ? 
 A. He was an attorney at law. 
 
NEW YORK CUSTOM-HOUSE. 
 
 117 
 
 Q. Where was lie practising 1 
 A. In New York. 
 
 Q. Had he any connection with the department at all % 
 
 A. None at all. I have here a memorandum which will aid the committee 
 in understanding the subject, and which has been prepared, as I have already 
 stated, by a clerk of mine, since yesterday morning. Mr. Gibbs had this con- 
 nection with the Treasury Department anterior to my coming into the office. 
 A discovery had been made of very gross frauds in New York city committed 
 by Anson Herrick, a dealer in stationery. Mr. Gibbs had proposed to prose- 
 cute that suit on behalf of the government on certain terms which were agreed 
 upon between him and the Secretary of the Treasury. I found Mr. Gibbs in 
 that position in reference to that particular case. 
 
 Q. Why was he employed to prosecute it ? 
 
 A. I do not know; I have no knowledge on the subject. 
 
 Q. Had he a contract ? 
 
 A. He had a contract with the department to prosecute that suit. 
 Q. Had not the government any prosecuting officer in New York to attend to 
 that business 1 
 
 A. It had, the same as it always had had. 
 
 By the Chairman : 
 Q. When was the contract made and by whom 1 
 
 A. Before I came into the office, I do not know whether it was made by Mr. 
 Chase or by his predecessor. The evidence is at the department, and the facts 
 can be easily ascertained. 
 
 By Mr. Rollins : 
 
 Q. Is that the customary way of carrying on prosecutions in New York 1 
 A. No ; it is not the customary way. There are cases of that sort, however, 
 occurring all through the country. By the way, I may say here that that was 
 a service which the district attorney could not have performed — the prosecution 
 of that case. 
 
 Q. Inform us why not. 
 
 A. I will endeavor to do so, and it will serve as an illustration of the difficul- 
 ties thrown in the way of the government officers in the prosecution of these 
 cases. That case was discovered in 1860. It appeared that this man Herrick 
 had been systematically undervaluing his merchandise for a period of ten years. 
 He was represented to be one of the most respectable merchants in New York. 
 He was a deacon, I believe, in a religious society, and above all suspicion. I am 
 informed that one of his modes of fraud was to pack fine cutlery, which he pur- 
 chased in England, in casks containing bottles of ink, and invoicing it all as ink. 
 He had correspondents in France and in Great Britain, and all the evidence to 
 make out the case had to be obtained from England or France, or nearly all of it. 
 It was for that reason, as I understood, that a special attorney was employed to go 
 abroad. That was the service which Mr. Gibbs undertook to perform — to go 
 abroad and collect this evidence in such form as to be used in the suit instituted 
 against Herrick. 
 
 Q. Did he go abroad to collect evidence in that Herrick case 1 
 
 A. Yes. 
 
 Q. Was he originally employed by the government for that purpose ? 
 
 A. For that purpose ; that is the first I knew anything about it, at all events. 
 But, I was going to say, we have been laboring industriously, or at least I have 
 been, from that time to this, to bring that case to trial, and we cannot get it to 
 trial yet. But I have just received from Mr. Gibbs a letter giving an account 
 of the progress that is being made in the execution of the commission which has 
 been sent to England for the second or third time to take the testimony of wit- 
 
118 
 
 NEW YORK CUSTOM-HOUSE. 
 
 ncsses in the case. First, there was an effort made in Franco, to obtain evi- 
 
 dence from Henick's correspondents there, but they horned their books and 
 papers and refused utterly to appear before the commission, and defeated our 
 efforts to get evidence from tliem. The correspondents in England promised 
 over and over again to appear and testify, but have always failed to do so. We 
 sent out one commission before the present one, and I am under the impre—i<>n 
 we sent two, and they were returned unexecuted because these witnesses would 
 not appear. It was understood that there was no law in England which would 
 compel a witness to appear in a case pending in a foreign country. Mr. Gibbs 
 made that representation to me, and, by way of inducing the British govern- 
 ment to make some provision in that regard, suggested that we should pas- a 
 law authorizing the taking ot" evidence in this country in cases pending in 
 British courts, and then to ask the British minister to desire his government to 
 pass a like law. That bill was prepared and passed through Congress, and the 
 matter was called to the attention of the British minister here, and sent by him 
 to Lord RuBSell, when, for the first time, we were informed that there was a 
 statute of Great Britain already in existence undrr which witnesses could be 
 compelled to testify in sucli cases. How our agent could have been misled in 
 this matter I do not know, but that he acted in good faith I am quite assured, 
 because one of the gentlemen named in the commission was in the United State- 
 pending the abeyance of the commission abroad, and was in my office, where 
 we had a conversation in reference to this matter, and he, either expressly or 
 impliedly, confirmed what Mr. Gibbs said in reference to the absence of any law 
 in England compelling these parties to appear. He gave that as a reason why 
 the commission had not been executed. Now then, however, our commissioners 
 have succeeded in getting these gentlemen before them. 
 
 By Mr. R0LLIN8 : 
 Q. Has Mr. Gibbs ever been back here since then? 
 
 A. He has been here two or three times. Our commissions are making 
 progress. 
 
 Has Mr. Gibbs been acting all the time from his first going abroad under 
 the same commission ? 
 A. 0, no. 
 
 Q. Has he received any new appointment since then ? 
 
 A. Certainly — the one under which the instructions just read were written. 
 Now, as I say, we are getting the evidence, and it is of this character — goods 
 for which this man paid .€515 were invoiced at €272, and so on through 
 the list. I speak of this thing merely as showing, as I supposed, the reasons 
 why Mr. Gibbs was employed in prosecuting that case originally. I think it 
 was entirely proper that he should be employed, because I do not think we 
 could have secured the end in view in any other way — that is, without the em- 
 ployment of somebody. It is very usual, too, that special counsel are employed 
 in such cases by all the departments of the government. The Treasury De- 
 partment has employed a good many within the last year. Now to proceed 
 with what I was going to say. Mr. Gibbs's appointment was made on this 
 general representation which I made to the Secretary, that, in my opinion, it 
 would not be advisable to go largely into the appointment of agents abroad 
 until we ascertained whether they were going to be of any service to us. Be- 
 fore that, another person had been sent abroad, A. C. Cetti, of Philadelphia, to 
 superintend the taking of evidence in some cases pending in Philadelphia, and, 
 I think, in New York. Before he went, I called his attention to rny views in 
 reference to the existence of frauds abroad, and asked him to occupy such of 
 his time as was not devoted to his special duties, in making general inquiry in 
 reference to these subjects. Very soon after he went abroad be sent me a letter, 
 in which he gave me specific information of fifteen importations of Rhine wines, 
 
NEW YORK CCSTOM-HOUSE. 
 
 119 
 
 giving me the exact figures in reference to the prices actually paid, in reference 
 to the market value, and in reference to the invoice value, showing undervalua- 
 tions extending from about 15 per cent, to about 40 per cent. Mr. Gibbs, soon 
 after he went there, made reports confirmatory of what we had learned from 
 those various other sources, and his reports were confirmed by those of the 
 consul general at Paris, Mr. Bigelow, and by statements made by our consul at 
 Lyons, and afterwards by the vice-consul, Mr. Viollier, and from that time to 
 this they have been confirmed in the most ample manner by information which 
 we have derived from all sources ; and it is entirely overcoming, as the com- 
 mittee will perceive if it takes the trouble of inspecting the matter. While 
 these reports were coming, accident caused a flare-up between some merchants 
 at San Francisco, importers of wines and liquors, the result of which was that 
 one person, having been expelled from the firm, took up a bundle of the cor- 
 respondence of his house, walked to the custom-house and said, " Gentlemen, 
 here is the sort of business that this house has been engaged in for the last ten 
 or fifteen years." The result was that the champagne wines of that house 
 were seized. Then it was that Mr. Farwell either wrote or telegraphed to me 
 for any information in possession of my office tending in the same direction. I 
 gave him general information, and the result was that all the champagne they 
 could find in San Francisco was seized, amounting to 8200,000 worth or more. 
 At the same time I advised the revenue officers at New York to seize all that 
 they could find there, which they did. 
 
 Q. What relation did Mr. Farwell then stand in to the government? 
 
 A. He was naval officer at San Francisco. I was not aware at that time that 
 I had ever seen Mr. Farwell, but my clerk says I had, and I suppose it was so. 
 On the seizure of the books and papers of some of the firms in Xew York, 
 whose wines had been taken in that way, we accidentally came across the cor- 
 respodence of a Xew York house with that very man in San Francisco, 
 whose wines had been first seized. It was to this effect, among other things : 
 That the writer or writers desired their friends and correspondents in Xew York 
 to understand precisely the predicament in which they were placed ; it was 
 this, that this scoundrel, as they called the man who had divulged upon them, 
 had taken their papers and gone to the custom-house, and that the papers, 
 showing the actual prices paid for their wines, and containing irrefutable proof 
 of the facts, were all in the possession of the custom-house authorities. They 
 then went on to advise their correspondents in Xew York what they desired them 
 to do, which was, in substance, to get up false testimony in France to defeat the 
 government. That is the Euglish of it. They did not put it into those words, 
 it is true, but if the committee will take the trouble to look at the correspondence 
 it will see that that is what was said in substance. Libels were filed, as a matter 
 of course, to condemn these wines. Then it was that Mr. Farwell was suggested 
 by the revenue officers as a proper person to go abroad to superintend the exe- 
 cution of the commissions issued in execution of these libels, and in support of 
 the proceedings in connection with them. He came to Washington, and, as I 
 have already stated two or three times, I was under the impression that that 
 was the first time I ever saw him. He went abroad, made preparations for the 
 trial of those cases in San Francisco, and returned. 
 
 Q. Indicate the character of the instructions which he received when he went 
 abroad ? 
 
 A. He was a special agent there. I do not think I gave him any instructions 
 at all. It is possible that I did, and it is very possible that I told him to em- 
 ploy himself generally. It is quite possible that I gave him instructions in re- 
 gard to his duties, and generally in regard to the subject of frauds. At all events, 
 he did look about him, as well in regard to those particular frauds as in regard 
 to others. But the point to which I was coming especially is this : On his re- 
 turn from San Francisco these cases were tried. There were from fourteen to 
 
120 
 
 NEW YORK CTT8TOM-HOU8E. 
 
 sixteen or seventeen cases tried, one after another. The wine merchant! were 
 defended by the ablest counsel that they could procure in S;tu Francisco The 
 result of it was that verdicts were rendered for the government in every CAfle ; 
 the jury being out sometimes three minutes and sometimes more, according to 
 the reports made to me. The law and the facts were thoroughly investigated, 
 and no position assumed by the government failed to receive the* approbation and 
 supporl of the district judge. These parties appealed as to matters of law to 
 the circuit court. Tin; instructions of the district court were reviewed and ap- 
 proved. They then appealed to the United States Supreme Court, and, at my 
 suggestion, the Secretary of the Treasury asked the Attorney General to take 
 such measures as that 1 1 1 * - trial should be brought on at the (asl term, in order 
 that we might have the final judgment on the subject, and might know whether we 
 were upon good ground or upon slippery ground. 'The Supreme Court sustained 
 the circuit court in all its rulings, and the.-e parties have paid the value of their 
 Wines, they having bonded them in the mean time, and then- has been derived 
 from that source something about 8:200.000. Then it was that I thought we 
 were in a position to enlarge our operations in that direction Then it was that 
 I advised the appointment of Mr. Farwell, because I had seen enough of him to 
 be satisfied that he was a very able revenue officer, a. judgment which I have 
 since seen no occasion to change, lie was appointed a general ;igent of the de- 
 partment in the same capacity as Mr. Gibbs, and he received similar instructions. 
 They were not in any material point different from those which Mr. Gibbs re- 
 ceived. As to the instructions to the collectors of the ports, all instructions that 
 1 have ev< r given I will submit to the committee. The question has been asked 
 whether any general instructions were ever given to collectors to make seizures 
 whenever Mr. Gibbs or Mr. Farwell or both should recommend. I say 1 have 
 no recollection of any such instructions having been given, and do not believe 
 that any such have been given. As I stated to the chairman informally before 
 some of the other members of the committee came in, the nearest approach to it 
 of which I have any recollection was in the case of New Orleans. Mr. Gibbs 
 had made reports to the collector of that port directly of a large number of fraud- 
 ulent importations of red wines from Bordeaux. lie sent me a copy of the re- 
 ports which he had made to the collector. After the receipt of these reports by 
 the collector, the collector telegraphed or communicated to the Secretary of the 
 Treasury to know what he should do. The Secretary referred his request to 
 me. Knowing, as I did, all about the general subject, and having the reports 
 of Mr. Gibbs before me, which stated explicitly the undervaluation of those 
 wines, I gave it as my opinion to the Secretary that the collector should be in- 
 structed to seize and detain all the wines which by these reports of Mr. Gibbs 
 were shown to be undervalued. The Secretary gave those instructions, and the 
 collector seized the wines, and they are now in custody uuless they were bonded. 
 Q. When was that? 
 
 A. In 1866 ; probably not more than six months ago. 
 Q. Is that the only instance of the kind ] 
 
 A. I think that is the only instance. I have in conversations often said that, 
 in my judgment, a clear, explicit statement made by one of our agents abroad 
 in reference to any particular case of wines or other goods, showing an under- 
 valuation to such a degree as to imply fraud, would be a sufficient warrant on 
 which collectors could justify seizures, and I say so yet. 
 
 Q. Allow me to ask what are the powers and discretion of these special 
 agents abroad in the matter of making seizures there, if they have any such 
 powers, or of compromising or settling seizures made in those countries, or 
 whether any instances of that kind have occurred ? 
 
 A. None whatever in either respect. They have no powers of that descrip- 
 tion. 
 
NEW YORK CUSTOM-HOUSE. 
 
 121 
 
 Q. Has there been a case recently of a settlement by Mr. Gibbs which re- 
 quired the department to use the cable to correct it 1 
 
 A. I will first make a remark or two in reference to the general question, 
 and then I will state all l\now about the special one. A great deal has been 
 said about the levying of black mail by these agents abroad. 
 
 Q. Then that has come to the knowledge of the department 1 
 
 A. Yes ; but I was going to tell you how it has come. The Secretary has 
 several times spoken to me about rumors which came to us recently about these 
 agents not performing their duties faithfully. I have frequently said, " Air. 
 Secretary, what are these rumors, and from whom do they come ?" and I have 
 repeatedly said, " Mr. Secretary, I was responsible for the appointment of those 
 gentlemen ; I am responsible for retaining them in their places, I think I have 
 a right t:> know, if any officer of this department has the right to know, what 
 is alleged to their prejudice ; and I want to know what allegations are made 
 against the character, official or personal, of either of these gentlemen ; and I 
 want to know who makes such allegations." I have never yet heard. I do 
 not believe one word of the sort ; and I do not believe that those gentlemen 
 have the power to do what they are alleged to have done, for, as I said a little 
 while ago, they have no power to make seizures ; they have no power to make 
 compromises ; and the conditions under which they perform their duties do not, 
 as it seems to me, admit of their levying black mail. 
 
 By Mr. Rollins : 
 Q. What are the allegations which you speak of? 
 A. These rumors. 
 Q. What are they 1 
 A. That these agents levy black mail. 
 Q Be more particular. 
 
 A. I was coming to that. As the committee will see at once, these agents 
 have not the manipulation of these invoices. It is not they who vise them, 
 
 By Mr. Broomall : 
 Q. Can they not withhold information for money? 
 
 A. That is the point I was coming to. That is the only case where such 
 thing could possibly be done, and I think it could scarcely be done in that par- 
 ticular. These invoices are deposited with the consuls, and not with those 
 agents. 
 
 By the Chairman : 
 
 Q. Have not those agents access to them at the consulates by special direc- 
 tion 1 
 
 A. Certainly. It is necessary that tliey should have in reference to the per- 
 formance of their duties, their duties being to inquire as to the commission of 
 frauds. The very purpose of requiring invoices to be deposited with the consu- 
 lates and kept there is to enable our agents to go there aud examine them. The 
 same reason called for the deposit of samples in order that agents might ex- 
 amine them, and might then inquire in the markets of the country as to whether 
 the transaction was fair or otherwise. As the certifying of the invoice is a 
 thing to be done by the consul, and not by the agent, there must, in the first 
 place, be complicity between the agent and the consul in order that the agent 
 can by any possibility favor the merchant. Therefore I do not see how they 
 have the power to do it. This, it seems to me. is a complete answer, showing 
 the impracticability of anything of that sort. We know that these agents are 
 constantly giving information to the revenue officers and to the department. 
 They send us prices current ; they send us invoices or abstracts of invoices ; 
 they send us samples and all that ; they give us general information in reference 
 
122 
 
 NEW YORK CUSTOM-HOUSE. 
 
 to all branches of importation; and therefore they would be defeating any 
 attempt on their part to suppress information of undervaluations in any partim- 
 lar case by giving us general information in reference to the Fame matter; so I 
 do not see how there is any practicability of their d<ting anything of thai -oil. 
 The only thing that has ever come to my knowledge, in any tangible shapf, of 
 anything that looked like an allegation against them, came from Senator Fogg, 
 in a conversation which I had with him last fall as 1 was going from this city 
 to New York, in which he said that Mr. Murphy, our consul at Frankfort, said 
 that Mr. (iibbs had told him he had said to a firm there, in reference to whose 
 transactions he had found some irregularities, that for S40,000 he would abstain 
 from forwarding information to the department. -Mr. Murphy was in this city 
 only a short time prior to that, lie came and went without seeing me, without 
 making any allegation of anything of that sort, to my knowledge, and I there- 
 fore take it for granted that there must be some misunderstanding, and I think 
 there was, too. I do not think it very probable that Mr. Gibbs would 
 have made a corrupt proposal of that sort, and then gone to Mr. Murphy and 
 told him of it. I think, therefore, that Mr. Murphy misunderstood what (Jibbs 
 said, or that Mr. Fogg misunderstood what .Murphy said. I think it would be 
 very surprising, knowing what I do of the nature of men and of the fate of 
 public officers who do their duty, if these gentlemen were not maligned by 
 those whom they detected in frauds. I think, moreover, that if anybody has 
 been black-mailed by these gentlemen they would know it, and would afford 
 the evidence of it to the department. There has not been the slightest thing 
 looking like evidence presented to me, and nobody has ever made any com- 
 plaint of the kind to me; all that 1 have ever learned in that way has been by 
 casual remark made by one or another, and particularly by casual conversations, 
 such as I have indicated between the Secretary of the Treasury and myself. 
 
 By Mr. Rollins: 
 
 Q. The merchants abroad have, of course, no means of knowing what informa- 
 tion your special agents convey to the department ; and does not that fact afford 
 these agents abundant facilities for levying black mail if they should feel disposed 
 so to do ? 
 
 A. I think not ; I do not see how. 
 
 Q. The merchant has no knowledge of what information has been sent. He 
 knows nothing about the correspondence between the special agent and the de- 
 partment ; and the agent may lead him to suppose that the whole thing depends 
 on whatever suggestion he makes ? 
 
 A. The point is this : Here are two merchants engaged in the same trade. 
 They are sending the same articles. Each of them is required to furnish to the 
 consul samples of the articles, so that there can be no question as to their iden- 
 tity. In addition to that our revenue officers here take samples of all merchan- 
 dise entered at the custom-house. An agent makes a general report, in which 
 he shows to the revenue officers and to the department the prices at which these 
 commodities are being sold. Does it make any difference whether he speaks of 
 one man or another man as an exporter, when he furnishes information on which 
 the goods of any man will be seized if the revenue officers do their duty? 
 
 Q. My point is this : that the merchant there does not know what the pre- 
 cise mode of procedure is, and may be led to suppose that more can be accom- 
 plished by a suggestion of the agent to the department than really cau be, and he 
 may feel himself to be in the agent's power to a great extent. I am led to believe 
 that the agent has a pretty large power in that direction indirectly. 
 
 A. I think he divests himself of that power the moment he makes general 
 reports here as to the value of merchandise. Only a short time since I learned 
 incidentally that Mr. Morse, our consul at London, had received from the Sec- 
 retary of the Treasury some powers in reference to some claim of the government 
 
NEW YORK CUSTOM-HOUSE. 
 
 123 
 
 there, and that Mr. Gibbs and he were in some way associated in the execution 
 of those powers. The case related to property which had belonged to the 
 confederate government, and which was supposed to be recoverable in Great 
 Britain. I learn that some compromise of those claims has been made by Mr. 
 Morse ; that Mr. Gibbs has participated in the compromise, and that the Secre- 
 tary is not satisfied as to the employment of Mr. Morse or Mr. Gibbs. As to 
 what they have done, or as to the reasons why they have done it, I know noth- 
 ing whatever about it. I have had nothing to do with the transaction first or 
 last, and had no knowledge of the transaction until the Secretary mentioned it 
 to me. The Secretary informed me he had received some communication from 
 Mr. Morse and Mr. Gibbs indicating that there was property there which could 
 be recovered by proper efforts, and that authority was given to Morse and Gibbs, 
 or to one or other of them, to act in the premises, and that they had, as he sup- 
 posed, settled claims which were not contemplated as coming within the scope 
 of the authority given, but which, as a matter of fact, did come, as the Secretary 
 said, within the scope of powers actually conferred. Whether the cable has 
 been employed to countermand what has been done, and to nullify it, I do not 
 know. 
 
 Q. Has it not been countermanded by letter or telegraph ? 
 
 A. That I do not know. 
 
 Q. It was not done through your office ? 
 
 A. No ; nor by consultation with my office. 
 
 Q. Has Mr. Morse or any other consul been ordered home or suspended on 
 this account ? 
 
 A. That I know nothing of ; it may be so. 
 
 Washington, D. C, December IS, 1866. 
 
 EDWARD JORDAN recalled. 
 By the Chairman : 
 
 Q. Go on with the statement you were making at the last meeting of the 
 committee. 
 
 A. There are two or three little things of a detached character which I would 
 like to mention now, as they will throw a little light upon the subject-matter of 
 this investigation. I mean the settlement of the Williams fraud and the rela- 
 tions between the parties connected with that transaction and myself, as well as 
 other things. One circumstance which occurs to me is this, and the committee 
 will at once see the inference to be drawn from it : that is, that Mr. Farwell 
 never made any application to me for his appointment as revenue agent — that 
 is, originally. The idea was my own. I suggested it to him, I am sure, before 
 it had ever entered his mind. I made the suggestion simply because my ac- 
 quaintance with him satisfied me that he was the most efficient man I knew of; 
 and in consequence of his peculiar experience, as well as his peculiar capacity, 
 he had been sent abroad to see to the execution of these commissions. He had 
 succeeded in his mission. He had made discoveries in other directions anterior 
 to that. He had also a good deal of experience in the naval office in San Fran- 
 cisco, and had been specially instrumental in uncovering frauds in the importa- 
 tion of cigars ; and these circumstances led me to the conclusion that he was the 
 most efficient person that I could suggest for that appointment. I mentioned 
 the matter to him. He at first manifested considerable indifference in regard to 
 it, or rather intimated that it was not possible that he could take it. He was at 
 that time naval officer at San Francisco, if I am net mistaken, and he gave that 
 and other reasons wh^ he could not accept the appointment. Afterwards, and 
 
124 
 
 NEW YOHK CUSTOM-HOUSE. 
 
 aft< r bifl leaving the naval office, he was Induced to consider the natter favor- 
 ably and to accept the appointment I will say, in addition to that, that be- 
 sides my own convictions in regard to the necessity of appointing additional 
 agents to Mr. Gibbs, the department bad received applications and argent ';L r - 
 gestions from various revenue and other officers as to the necessity of appointing 
 additional agents. Mr. Thomas, of Philadelphia, had at one lime pr another 
 urged the matter upon the department; Mr. Rankin, the collector at San lYan- 
 cisco, had done so; Mr. Murphy, our consul at Frankfort, had done so, as well 
 as Governor Morgan, of New York. 
 
 By Mr. B ROOM ALL : 
 Q. What was Mr. Way's business prior to his connection with this transac- 
 tion ? 
 
 A. I do not know ; I think he was a banker or speculator. I will say in 
 this connection that I had not so much as heard of Mr. Way previous to my 
 trip to Boston The only interviews I ever had with Mr. Way there w» re at 
 the custom-house and in bis own office. At my interview with him .it the cus- 
 tom-house I think the collector was present, or his private secretary; and the 
 only other interview I had with him was at his owu office, where I went at his 
 request. His ohject in asking that interview was to call me to account for send- 
 ing those messages to his clients. I may add, however, that I have never since 
 had the least correspondence with him, directly or indirectly, except that I re- 
 ceived one official letter from him upon a matter entirely disconnected with this, 
 to which he called my attention. I will say further, that in any one of the con- 
 versations that occurred between Mr. Way and myself there was not the least 
 or remotest approach towards a suggestion of any consideration of any descrip- 
 tion whatsoever. I will say further, that I repeatedly said to him, and I have 
 said to Williams & Co., that it was perfectly indifferent to me whether there 
 was any compromise or not. I invariably said that the government had but one 
 course to pursue — to prosecute these cases in court, unless the parties themselves 
 voluntarily came forward and asked for a different settlement; and my visit to 
 Boston was to satisfy myself and th/j department whether whit th y weiv un- 
 derstood to ask in that regard was r 'asonable and proper. I will say also, in 
 that connection, that neither Mr. Goodrich, Mr. Tuck, Mr. Farwell, nor any 
 other person connected with that transaction ever asked or suggested any spe- 
 cial action on my part of any sort, either officially or otherwise, except to urge 
 upon me such considerations that occurred to them as proper to look to in the 
 determination which the government should adopt. I said before, I believe, 
 that Mr. Farwell, at the time we were in New York, requested me, if the Sec- 
 retary should finally decide to acquiesce in the adjustment in any other way 
 than through a court, to inform him. I supposed, and still suppose, that his 
 reason for wishing to be so advised was to enable him to be present at the final 
 adjustment of the matter. In regard to the delivery of this check from Mr. 
 Goodrich perhaps it is well enough for me to state some circumstances which, I 
 think, will serve to show the view which I took of the matter at the time. Mr. 
 Tuck came into my office in the Treasury Department while a young lady, a 
 clerk in my office, was sitting in the room. He remarked, on entering the room, 
 that he had a very agreeable message for me. He put his hand in his vest 
 pocket and took out the check and handed it to me. All this was in the pres- 
 ence of the young lady. While Mr. Tuck was in my office Mrs. Jordan came 
 into the room. And he said that he imagined his visit on the occasion was a 
 pleasant one to me ; that he had brought me some money that made it a pleasant 
 visit. Whereupon, I explained to Mrs. Jordan what he alluded to. I have 
 often spoken of the matter since to everybody to whom it occurred to me to 
 say anything about such matters. 
 
 Q. Did you ever communicate it to the Secretary of thg Treasury ? 
 
NEW YORK CUSTOM- HOUSE. 
 
 125 
 
 A. I never did until the matter became the subject of investigation I thought 
 of doing so repeatedly, and what deterred me was simply this : it occurred to 
 me that if I should voluntarily tell the Secretary about a matter of this sort it 
 would have the appearance that I might be a little conscious that there was 
 something wrong, and that I wanted to forestall his judgment in regard to it; 
 but I will say that after 1 had learned that there had been additional money 
 paid, that it was alleged that more money had been paid, and that Mr. Farwell 
 was suspected of having some connection with it, I told Mr. Farwell the circum- 
 stances, and advised him to go to the Secretary and tell him the simple facts in 
 regard to it; and I said in that connection that he should tell Mr. McCulloch 
 that he had paid me $4,000, and tell him just how he had paid it to me. 
 Whether Mr. Farwell did that or not I cannot tell, as I was not present at the 
 interview, and that was before Mr. Goodrich's or Mr. Tuck's evidence was given 
 here, or before any evidence was given before this committee so far as I know. 
 
 Q. Are there any prosecutions against the merchants of Boston instituted by 
 Mr. Goodrich, or while he "was collector, still pending? 
 
 A. Yes, sir. 
 
 Q. How many of them? 
 
 A. I presume there are a good many. I do not know exactly. There are 
 generally quite a number continued from time to time. How many, as a matter 
 of fact, may be pending now, I do not know. I have knowledge of several — 
 perhaps five or six. 
 
 Q. Do you know of any reason why they have #ot been prosecuted ? 
 
 A. I suppose I do. I do not know, however, but that it is a matter of infer- 
 ence after all. I do not know that I can say positively what the reason is. 
 
 Q. Do you know of any instances in which their books, &c, have been with- 
 held from merchants in any of those suits up to this time? 
 
 A. I do not know. I do not mean to soy that there is no such case; but I 
 am not aware of it. 1 know that the books and papers of some of those mer- 
 chants have been seized, and they may have been withheld up to this time for 
 all I know to the contrary. I will say this — that I would prefer not to express 
 any opinion in regard to the management of those cases, because it would only 
 be a judgment, and the facts can be ascertained from the files of the department, 
 and the committee will be just as competent to form a judgment as I would be 
 myself. And in relation to these agents, both Mr. Gibbs and Mr. Farwell, I 
 want to gay this — that there has never yet, so far as I recollect, reached my 
 office a srigle allegation against the official conduct of either of these gentlemen 
 during the time they have been employed in their present position. On the 
 contrary, repeated testimony has been given by various of our representatives 
 abroad to their ability, industry, and usefulness. That testimony has come 
 from Mr. Bigelow, and various persons abroad. In addition to that, Governor 
 Morton of Indiana came to the department on his return from Europe to testify 
 his high appreciation of the capacity and usefulness of Mr. Gibbs, and urged 
 the consideration of his suggestions, and to advise that he should have the largest 
 powers, and to urge the extension to him of the entire confidence of the depart- 
 ment. The governor did not visit me, but his remarks and suggestions were 
 communicated to me from the Secretary's office. Mr. H. D. Cooke coming from 
 Europe, came to my office and saw me personally, and spoke to the same pur- 
 port. Several of our consuls who visited the United States at one time or an- 
 other have come to me personally in like manner, and expressed the same opin- 
 ions. The only things that have ever reached me touching their conduct as 
 officers abroad, in any way derogatory, were those rumors that I mentioned the 
 other day. Among those who spoke of Mr. Gibbs was Colonel Lawrence, our 
 consul-general at Florence, who spoke in the highest terms of the general effect 
 of the measures adopted by the agents there, and in this connection I desire to 
 
12G 
 
 NEW YORK CUSTOM-HOUSE. 
 
 call the attention of the committee to the following letter from Mr. Murphy, our 
 consul general at Frankfort : 
 
 Consulate General of the United States of America, 
 
 FnniLjo/t-on-thc-Maui, August !, l^GO. 
 
 I am glad to learn that Mr. Gibbs, acting upon my suggestion, lias called 
 your attention to the demand for our government securities in this market. 
 
 I have frequently referred to it in my officio] despatches to the State De- 
 partment. I fully concur with Mr. (iibbs as to the views expressed in his let- 
 ter, as he is fully conversant with the market here, and acquainted with a lead- 
 ing banker in this city, and of course speaks advisedly. 1 have no doubt but 
 that $15,000,000 to $20,000,000 of our six per cent, coupon bonds, and perhaps 
 more, could be disposed of here and in the neighboring market, in less time than 
 would be required to arrange a foreign loan without publicity, and without cost- 
 ing the government one dollar. 
 
 I know Messrs. Naclnnan \ Dyer, the gentlemen who proposed the arrange- 
 ment referred to in Mr. (iibbs's letter. They are gentlemen of the highesl re- 
 spectability and of great wealth, and possess peculiar facilities for making large 
 transactions here, as also at Amsterdam, Hamburg, and Berlin. I doubt if any 
 brokers in Europe could so economically and efficiently carry out such a proposi- 
 tion. They are in this respect fully competent to cope with the Kothschilds, 
 who are acting as agents of and in the interests of Austria, of whom they are 
 friends, and whose bonds th% T are now forcing openly upon the market, and en- 
 deavoring in every possible way to depress the market for American govern- 
 ment securities. If, as I hope, the government avails itself of this proposition, 
 I shall be glad to render any service in my power, and will cheerfully share 
 with Mr. Gibbs any labor or responsibility in connection with the delivery of 
 the bonds and the payment which may be made therefor. 
 
 Messrs. Xaehman & Dyer are well known to some of our best bankers in 
 America, and the firm of Drexell & Co., of Philadelphia, are now sending them 
 820,000 per week of the six per cent, coupon bonds for sale, profits being di- 
 vided equally among the parties, and the proceeds drawn for at sixty days. 
 I am, &c, 
 
 WILLIAM W. MURPHY, 
 
 United States Consul General, !fc. 
 
 Hon. Edward Jordan, 
 
 Solid to?- of the Treasury, IVashingtoji, D. C. 
 
 "Washington, December 15, 1866. 
 TIMOTHY C. D WIGHT sworn and examined. 
 By the Chairman: 
 
 Q. Have you been connected with the government ? and if so, state when, in 
 what department, and how long % 
 
 A. About fifteen months, from the 20th of June, 1865, at the city of Xew 
 York, as special agent of the Treasury Department. 
 
 Q. Are you still special agent ? 
 
 A. No, sir ; I was removed on the 1st of September last. 
 Q. For what cause, and by whom % 
 
 A. I was removed by the Secretary of the Treasury. I do not exactly know 
 the cause. I was removed soon after exposing certain matters and wrongs of 
 the collector of the port, in which the name of Senator Patterson, of Tennessee, 
 as well as his wife, appears. 
 
NEW YORK CUSTOM-HOUSE. 
 
 127 
 
 Q. You say "for exposing certain matters," please indicate to the committee 
 what you mean by " exposing," and the medium or course you pursued % 
 
 A. Taking testimony and ascertaining as to the sale of the storing of general 
 order goods in the city of New York, to Miller & Conger, merchants, in the 
 city of New York, and reporting to my superior officer. 
 
 Q. You may state to the committee your knowledge of that transaction. 
 
 A. Complaints were made to me by Messrs. Bixby & Co., which firm was 
 composed of two gentlemen by the name of Bixby, who were brothers, and Mr. 
 Humphrey, late member of Congress from Kings county, third district, New 
 York. The Messrs. Bixby of that firm — the two brothers — first made the 
 complaint to me as to the selling- of the general order goods to Miller & Conger 
 for the sum of $40,000 by Collector Smythe. 
 
 Q. By whom and when ? 
 
 A. By Henry A. Smythe, now collector of the port of New York. 
 Q. When did they make the complaint to you 1 
 
 A. In the spring or summer of 1866. I proceeded to the store of Messrs. 
 Miller & Conger, of New York, and took Mr. Miller's statement in reference 
 to it, which was to the purport that he had made an arrangement with Mr. 
 Smythe, by whicli Messrs. Miller <fc Conger were to pay to the collector 840,000 
 for the privilege of storing the general order goods in a certain district in New 
 York, whicli district included, I believe, the North and East rivers, below the 
 warehouse of Miller & Conger on the East river, and below Bank street on the 
 North river. The complaint was made to me on very excellent authority, and 
 obtained by me in my official capacity from the custom-house broker of A. T. 
 Stewart, a Mr. Pratt, and from the Messrs. Bixby, who had obtained such in- 
 formation in part from a correspondence from Collector Smythe to their partner, 
 the Hon. Mr. Humphrey, and other sources, by which it seemed that the follow- 
 ing was to be the disposition to be made of the $40,000, as I was officially 
 informed by Mr. Pratt : To Mr. Van Bergen, a relative of Collector Smythe, 
 $10,000 ; to a Mr. Thomson, (George F.,) formerly of the Daily News office, and 
 of Fort Lafayette notoriety, 810,000 ; to Senator Patterson $5,000 ; the wife of 
 Senator Patterson $3,000 ; Deputy Collector Embree $2,000, and the balance, 
 $10,000, to be retained by the collector for political purposes, which last men- 
 tioned sum of 810,000 the Messrs. Bixby stated to me the collector said, or 
 had said, he should expend for that purpose, as he did not intend or expect to 
 make as much out of fines, penalties, and forfeitures as had been heretofore 
 made out of it by former collectors. 
 
 Q. Did you ever see that letter ? 
 
 A. I did not. 
 
 Q. How do you know there was such a letter ? 
 
 A. From the Messrs. Bixby, who have that letter in their possession, I be- 
 lieve. The collector of the port had received instructions from the Treasury 
 Department to confer with John B. Guthrie, the supervising special agent of 
 the Treasury Department, to whom I at that time reported progress upon all 
 occasions of malfeasance, &c, by order of the Secretary of the Treasury, on a 
 morning named, at ten o'clock, to close a contract with Robert P. Getty for the 
 hiring of a warehouse in the rear of Trinity church yard in the city of New 
 York, for ten years, at $45,000 per annum, for an appraisers' department. The 
 collector of the port did not confer with Mr. Guthrie {hut suppressed the letter 
 from him, as I am informed by Mr. G.) on that morning, as he was requested to 
 do, and at about one o'clock Miller & Conger closed with Mr. Getty for the build- 
 ing for the same sum of $45,000 per annum, the government losing the lease of 
 the premises as was then presumed. There was then a communication addressed 
 to the department by Mr. Guthrie, after a consultation with myself, requesting 
 the Secretary to Avithhold the bonding of that building to Messrs. Miller & Con- 
 ger, to prevent their storing the general order goods in it under the arrangement 
 
128 
 
 NEW YORK CUSTOM-HOUSE. 
 
 made between Miller and the collector. The consequence was that the agree- 
 ment between the collector of the port and Miller cV Conger fell through, be- 
 cause the building was not bonded. Then the government took a lease of the 
 warehouse at > 10,000. for ten years, for an apprai-ers 1 department, a- Mr. 
 Guthrie, informed me. 
 
 (J. Where is this Mr. Getty, or who is he ? 
 
 A. lie is a very wealthy and highly reputable citizen in Yonkers, West- 
 chester county, and a dealer in pork in the city of New York, and has an office 
 on Greenwich street, in the building so leased. 
 
 Q. Do you recollect his first name? 
 
 A. Robert P.; 1 have known him for years very intimately. 
 
 By Mr. ROLLINS : 
 Q. Did Mr. Getty own the block 1 
 
 A. Yes, sir ; it is a tremendous warehouse That is the one leased at 845,000, 
 and cheap at that. 
 
 Q. Miller & Conger then had the contract with the collector, with reference 
 to the general order business at that time? 
 
 A. They had made it previously, and in order to carry it out hired this 
 building, which was convenient to the appraisers' • department. Hut it was 
 given up by Miller &: Conger, because the building was not bonded. The 
 •Secretary refused to bond it. Miller cV Conger can give you statement-* of the 
 enormous expense they have been at, in order to carry out this business, such 
 as printing documents, hiring clerks, and altering the warehouse, which they 
 bad commenced to do. The matter in relation to the disposing of the general 
 order storage of these goods by Collector Smy the to Messrs. Johnson & Co., on 
 Hridge street, as the complaints were made to me officially, is ■ they were to pay 
 to the collector a certain percentage of the gross amount (35 per cent, was the 
 turn reported to me) of receipts for storage which was made subsequent to the 
 time that the contract fell through with Miller & Conger. Immediately after 
 the commencement of the receipt of such goods by Johnson & Co., frequent 
 complaints were made to me of the enormous charges for storage that they 
 made for the storage of certain goods. The amount was generally from 100 to 
 200 per cent, more than their allowance. I invariably told the persons making 
 the complaints that I could do nothing in the premises whatever; that it was a 
 matter entirely between them and Johnson & Co.; and that I presumed John- 
 son & Co. stored them as cheap as they could afford to under their contract with 
 the collector of the port. For some time past the general order goods store has 
 been opposite pier 37, North river. Within a short time, and under a new ar- 
 rangement, the general order store has been opposite pier 56, North river, at 
 Banks street. The cartage of goods to the public store to be appraised, from 
 the old general order store, is by regular allowance 81 10 per load. From the 
 new general order store to the public store the cartage is $1 98 per load, thus 
 costing the government or importers 88 cents more for cartage by the exchange 
 of stores. 
 
 Q. Have you any means of informing the committee what the amount of 
 cartage averages per week, month, day, or year, in the aggregate? 
 A. It would be only guess-work, sir. 
 
 Q. This store is very far removed from the custom-house and from the he 
 business of the city? 
 
 A. About twenty piers — more than a mile — I should think. Among the com- 
 plaints made to me for overcharges by Johnson & Co., in Bridge street, upon 
 general order goods, I will instance one : Two bales of burlaps, for one night 
 in store, $6 50 each, making $13. The charge should have been $2 75 each. 
 And five cases of wine, on each 40 cents storage, and 50 cents labor on each, 
 
NEW YORK CUSTOM-HOUSE. 
 
 129 
 
 was charged. It should have been five cents labor and five cents storage on 
 each. 
 
 Q. Do you mean to say that $2 75 each would have been the proper charge 
 per bale for burlaps. 
 
 A. Yes, sir; that is very liberal, though they are very large and troublesome 
 to handle. There, you see, is an instance where 800 per cent, on the storage 
 is charged on the time more than there should be, and 1,000 per cent, more 
 than there should be charged on labor. In the charges on the time, I have here 
 a memorandum of a complaint made to me against Johnson & Co., in cases of 
 goods as follows, being charges for storage : 
 
 W. & B. 4377|9 f5 85 
 
 G. K.2211 » . 
 
 6290 f 6 lb 
 
 L. S. S. 97S0|1 3 75 
 
 R. 316 ) 
 G. 317 / • 
 
 17 25 
 
 Amounting, as added up, to 817 25, each being $1 92. The highest price ever 
 charged for these cases before was $1 50 each. This bill should be 30 and 30 
 and 60 per cent, advance, and the 33 cents cartage, making $1 29 each case. 
 The legal cartage from No. 371 Washington street to Mr. Roggs's store would 
 be 66 cents per cart-load ; from Le Roy street store SI 10. Roggs's store is at 
 No. 44 Park Place. He has the above bill. By the other statement of the 
 cartage between the stores where they have removed the business to from where 
 it formerly was, which shows that $1 29 each case would have been charged if 
 the general order business had been left at No. H71 Washington street, where it 
 was ; but now it is charged $1 92, making 63 cents per case more for the cartage. 
 
 By the Chairman : 
 
 Q. Is there any difference in the conveniences, accommodation, or security 
 between what you call the Le Roy street store and that at 371 Washington 
 street ? 
 
 A. If the goods were taken to the Washington street store they would be 
 nearer to the public store. Going to the Le Roy street store, they pay extra 
 cartage to get the goods there, and extra cartage to get them away. 
 
 Q. WhaL difference would it make to A. T. Stewart which store his goods 
 went to % 
 
 A. It would make the difference in the price of cartage, as above stated. 
 Q. Would not he save that when he comes to cart 1 
 
 A. No, sir '; because his store is at Chambers street, near the store of Mr. 
 Roggs, in Park Place ; and the public store, where part of the goods — one 
 package in ten — must go, is below Wall street, in Broadway; and the Le Roy 
 street store is a long way above Canal street, and the Washington street store 
 is a long way below Canal street. To the Washington street store the cartmen 
 are entitled to one mile cartage ; to the Le Roy street store they are entitled to 
 two miles cartage. The order from the Secretary of the Treasury requires 
 that when the public store is full the goods shall be sent to the nearest general 
 order store. In the early part of the season of 1866 the public store was full 
 of goods, and goods were transferred to Johnson's store, 8 and 10 Bridge street, 
 and stores 102 and 104 Grand street, by Daniel Jackson, chief clerk. Har- 
 vard & Lowell called on the auditor for bills of storage on those goods as early 
 as November last, and he sent them as before, fifteen or twenty times, to Bridge 
 street, when they should have been sent to Greenwich street. Messrs. Bixby & 
 Co. complained to me that the reason was that they had stopped paying Daniel 
 H. Rep. Com. 30 9 
 
130 NEW YORK CUSTOM-HOUSE. 
 
 Jackson, chief clerk, moneys upon hifl orders for hii services in doing what the 
 
 rules and law required him to do without pay from Bixby & Co., and what the 
 
 government paid him for. The amounts of money paid to Jackson are, as I 
 am Informed by the oldest Mr. Bixby, from two to three hundred dollars. He 
 requir- d Messrs. Bixby cV Co. to pay him moneys for doing his duty as an 
 Officer of the government, in sending those goods to the Dearest general order 
 store from the public store ; and, as evidence to prove their assertions to me, 
 they looked for the checks. &C., drawn on them hy Chief Clerk .Jackson, and 
 found two. There was a secret understanding between them that this money 
 was not to he paid hack at all — so the Messrs. Bixby informed me — and that no 
 part of the moneys so paid to .Jackson ever was paid hack by Jackson. 
 The following are copies of the papers : 
 
 New Yohk, November 11, 1SG2. 
 
 Received of F. M. Bixby fifty dollars, which I promise to pay to his order 
 on the 150th of November instant ; and 1 hereby assign my salary, due on the 
 30th of November, as security for the payment of said fifty dollar-. 
 
 DANIEL JACKSON. 
 
 Please send me check by bearer. 
 
 1). J. 
 
 New Ymkk, January 11, 1863. 
 
 On the loth instant please pay to order of J. M. Holder, for value received, 
 fifty dollars and charge to me. 
 Respectfully yours, 
 
 D. JACKSON. 
 
 F. M. BlXBY, Esq., 371 Washington street, New York. 
 ' Endorsed on back, "J. M. Holder." 
 
 There was a larger number of such documents, but they said that they usually 
 destroyed them. Messrs. Bixby stopped paying Jackson and told him he might 
 go to the devil; they would not pay any more of his drafts. (The probability 
 is if he did not go, he will.) When they stopped paying, no more transfer 
 goods were sent to them, but were sent to Johnson & Co. He has since been 
 appointed to a position in the appraisers' department, and has the general super- 
 vision of the "transfer goods" of the custom-house in that department, and 
 sends the "transfer goods " to Johnson & Co. 
 
 By Mr. A R.\ ELL : 
 
 Q. You speak of certain persons Laving received pecuniary consideration in 
 connection with the matter under consideration. "What services were Senator 
 Patterson and wife to perform for that consideration ? 
 
 A. I do not know anything about that, sir; but, would respectfully refer you 
 to Collector Smythe for the information. That contract had fallen through in 
 consequence of these warehouses not having been bonded by the Secretary of 
 the Treasury. They could not, therefore, have received anything from the Mi.ler 
 & Conger contract. 
 
 By Mr. Rollins : 
 
 Q. You stated some time ago that some portion of the percentage of this was 
 to be paid to the collector ? 
 
 A. I know nothing of that personally — only on information, as before stated. 
 
 By Mr. Arnell : 
 Q. This whole matter fell through 1 
 
 A. It fell through in consequence of the Secretary of the Treasury refusing 
 
NEW YORK CUSTOM-HOUSE. 
 
 131 
 
 to bond the warehouse. Miller & Conger had nowhere to put the goods. The 
 further particulars of this can be had of the parties who made these complaints 
 to me officially, as before named. 
 
 By the Chairman : 
 
 Q. Are you cognizant of any frauds or abuses in the "sugar sampling" busi- 
 ness, &c, in New York? 
 
 A. Having heard several complaints in that way, I took the matter in hand 
 as soon as I could do so, but had not finished it when removed from office. I 
 called upon the storekeeper for cartmen's receipts for sugars that were taken 
 from the building by cartmen, and procured them — a very large number of 
 them. I then employed a person to watch for barrels of samples of sugar as 
 they came from the sugar department to be carted away and to follow the carts, 
 and inform me where those sugar samples went to. He did so, and reported to 
 me that they were delivered, on the day that I employed him, to Edmund J. 
 Wade, sugar broker, corner of Wall and Water streets. 
 
 By Mr. Rollins : 
 Q. What amount df samples were sent ? 
 
 A. Four barrels, on the day I required the man to follow the cart from the 
 public store. 
 
 Q. What should be done with these samples 1 
 
 A. Each importer's should be kept separately, and returned to him. 
 
 By the Chairman : 
 Q. About when was this % 
 
 A. In the month of July, last. I can give you a little more of the particu- 
 lars in the following paper : 
 
 " August S, 1866. 
 
 "Frank Wanzer, cartman, No. 1,111, took four barrels sugar samples in his 
 cart to 91 Water street, corner of Wall ; taken to Edmund J. Wade from public 
 store, on Mr. Phillips's order to pass them out of the building." 
 
 Q. Were you before the Committee on Retrenchment ? 
 
 A. They had me there a few minutes, but, as I had no memorandums, requested 
 me to postpone it and they would send for me to come to Washington. But to 
 continue in relation to the cartage : Mr. William Albert-son, of the city of New 
 York, who is a reliable man, proposed to Collector Smythe, on or about the 10th 
 day of June, 1866, to do the carting for the " transfer goods " for thirty-two per 
 cent, less than the regular charges, which percentage was to be for the benefit 
 of the merchants. He proposed to do it at fifty cents per load in cases where 
 he would by. usage be entitled to sixty-six cents; and for one dollar where he 
 would be entitled to one dollar and thirty-two cents, and would give ample se- 
 curity for his faithful performance. He called frequently to see Collector Smythe, 
 but no attention was paid to his application. This reduction was to be for the 
 benefit of the merchants exclusively. The cartage was given to Mr. John Lind- 
 say at the regular rates. Now for that sugar-sampling again : Messrs. Burdett 
 & Everett, importers of sugar, at 174 Water street, have received none of their 
 sugar samples during the year 1866. In one instance they had from forty to 
 fifty pounds of sugar taken from one hogshead of the best Porto Rico by the 
 sampler. 
 
 Q. Do you know who the sampler was ? 
 
 A. Well, sir, there are but two samplers, I believe. I did not ask them which 
 one, because they did uot see it taken. The names of the samplers are Hartshorne 
 and Harris. 
 
132 
 
 NEW YORK CUSTOM-HOUSE, 
 
 By Mr. Rollins \ 
 Q. How much sugar should be taken as a sample? 
 
 A. Three quarters of a pound, I believe. Messrs. Ihirdett & Kverett in- 
 formed me, November 21, ]8GG, that forty or fifty pounds of sugar had been 
 taken from one hogshead. There baa been a man appointed to look after the 
 sugar samplers, and follow them about. By whom lie if appointed, or upon 
 wbat authority, I do not know. He has been following them pretty closely 
 until a complaint was made by Mr. I lart.-diome to Mr. Phillips that be did not 
 like to be watched ; that it was humiliating to him. The person who was to 
 follow him bas been requested to follow bim some distance behind — to follow 
 
 around after him, but so far behind that bis service- are of no benefit to the 
 government whatever. 
 
 By the Chairman : 
 
 Q. In the matter of sampling sugar : when is the sugar taken out of the casks 
 for sampling ? 
 
 A. Before it is weighed, as I am informed. 
 
 Q. The result is that the government loses the duty on the samples 1 
 A. Yes, sir, generally speaking. 
 
 The witness submitted the following statement, accompanied with the remark 
 that although the steamers had increased, and the passengers and emigrants have 
 increased, t here is a great falling off through that channel, of receipts to i he govern- 
 ment of money received for dul es on goods imported in trunks of passengers, from 
 
 what there should he, owing, in his opinion, to the displacing of old and good offi- 
 cers, and the appointment of new ones, who do not understand their business, or do 
 not attend to their duties as inspectors. 
 
 Amount of duties collected at steamers, from January, 1SG2. 
 
 Months. 
 
 1862. 
 
 1863. 
 
 1864. 
 
 1865. 
 
 1>66. 
 
 January 
 
 S41 80 
 
 $183 19 
 
 si 78 30 
 
 $562 90 
 
 si ,336 61 
 
 
 lt;:» 50 
 
 472 15 
 
 21 05 
 
 24 50 
 
 713 58 
 
 March 
 
 778 47 
 
 221 45 
 
 228 10 
 
 4ii- 77 
 
 1, 132 05 
 
 April 
 
 710 15 
 
 1,068 15 
 
 305 60 
 
 418 94 
 
 1, 105 U7 
 
 May 
 
 737 51 
 
 704 85 
 
 928 52 
 
 657 00 
 
 2,737 68 
 
 
 239 30 
 
 856 65 
 
 598 93 
 
 1,035 (il 
 
 1,901 14 
 
 July 
 
 814 75 
 
 796 75 
 
 769 00 
 
 3,061 40 
 
 2,732 59 
 
 
 1, 519 64 
 
 590 55 
 
 740 62 
 
 3, 203 75 
 
 3,562 94 
 
 September 
 
 812 48 
 
 1,120 85 
 
 1,638 02 
 
 5,-71 (i< 
 
 6, 362 63 
 
 October 
 
 648 75 
 
 1,251 76 
 
 1,395 61 
 
 7,479 47 
 
 4, 136 86 
 
 
 IM >:> 
 
 1,036 08 
 
 1, 122 78 
 
 4,091 86 
 
 4,440 90 
 
 
 569 20 
 
 1,482 93 
 
 915 59 
 
 1,440 28 
 
 
 Total 
 
 
 8,019 40 
 
 9,785 36 
 
 8,782 12 
 
 28,256 16 
 
 30, 1(52 05 
 
 The expenditures at the quarantine boarding station, Staten island, prior 
 to August, 1S66, were for three boarding officers — for one boarding officer and 
 two assistants, whose business it was to board all steamers, night and day, 
 and to board and get the papers of all sailing vessels at quarantine or at anchor, 
 with two night watchmen for night duty, to take papers and then send them to 
 the surveyor. Since August, 1866, a change has been made by the surveyor. 
 No duty is now performed by the boarding officers and night watchmen, as it is 
 done at the barge office, and the night watchmen are in New York aud on Staten 
 island without anything to do. They are presumed to watch for smugglers, but 
 they have no boat nor barge. Since I have been removed from office it is very 
 frequently the case that I am stopped in the street, or called upon at my private 
 
NEW YORK CUSTOM-HOUSE. 
 
 133 
 
 office, by parties who give me information which they suppose would be benefi- 
 cial to the Treasury Department to be in possession of. I hear their stories 
 through, and then inform them that I have no longer anything to do with it. In 
 one case I was called upon by a gentleman, who informed me that a Mr. David- 
 son (I think the name is) had been detailed by the collector to attend upon the 
 wharf with the other officers, forming a board to appraise goods and collect duties 
 from goods imported in passengers' trunks, when about $800 in gold was received 
 by Mr. Davidson, and retained by him over night, as the board did not get through 
 their business until about five o'clock in the afternoon. He lost the money in a 
 gambling saloon, and was removed from office by the collector. His friends re- 
 funded the money, and Mr. Davidson has since been reappointed in the custom- 
 house. 
 
 Q. State whether you have any information given to you as to the proceedings 
 of master gangers and markers 
 
 A. I was informed by Charles Marx, a sampler of liquors, that they have not 
 attended to their business. Their assistants do it. The masters are seldom seen 
 on duty ; and that the liquor is taken from the casks after gauging and carried 
 away in men's pockets. 
 
 Q. Do you know anything further of the abuses in the liquor department of 
 the customs at New York ? 
 
 A. I have been informed that goods were shipped away or placed beyond the 
 reach of the samplers as soon as the penal bond is given, and hence nothing 
 further could be done by the examiners in appraisement of it; as, for instance, 
 in brandy. He must know the proof before he can classify. We must know 
 what the proof is the very moment liquors are entered, for as the proof goes up 
 the duties increase. Permits have been given at the custom-house before the 
 liquors, wines, &c, were gauged or sampled to take them away. Invoices were 
 put in my possession in which permits were given to take liquors to Newark, 
 New Jersey, and they were so taken without sampling. 
 
 Q. Who gave these permits ? 
 
 A. The proper officer in the custom-house. 
 
 Q. By whose authorization are they issued? 
 
 A. From the custom-house. 
 
 [Memorandum. — July 5, 18G6, duty was paid on invoice No, 112 in red 
 chalk. Two days after, the invoice came to Examiner Robinson, and the goods 
 had been shipped to Newark. 
 
 Invoice No. ; J. Morton Stewart, Baltimore; goods were shipped in bond 
 
 to Baltimore before sampler could sample, in which were 300 casks of brandy. 
 The importer (very gracefully) permitted samples to be sent back in bottles, 
 under Baltimore custom-house seal, to New York appraisers.] 
 
 Q. Do you know anything of the abuses in the storekeeper's department? 
 If so, state what you know. 
 
 A. I sent for Mr. J. F. Smith, ex-chief clerk and ex-storekeeper, and required 
 of him to state all facts in relation to the payment of moneys by him to Store- 
 keeper Allaben on the 16th of August, 1865 or 1866. Mr. Smith informed me 
 that at the time he left the office of storekeeper Mr. Allaben, his successor, de- 
 manded of him all moneys in his hands which he had received for old iron, steel, 
 waste-paper, refuse wool, and old bagging, that had accumulated in the public 
 store, which were the savings of about one year. Mr. Smith replied that there 
 were in his hands from $320 to $330, and he paid it over to Mr. Allaben and 
 took his receipt therefor. I communicated this knowledge to Supervising 
 Special Agent Guthrie in the following note : 
 
 Custom-House, New York, July 16, 1S66. 
 Dear Sir : I have authority for saying that Ex-Storekeeper Allaben received 
 from his "predecessor" in office when he, Allaben, took possession at the public 
 
134 
 
 NEW YOKK CUSTOM-HOUSE. 
 
 store as storekeeper, the sum of about $300 for off-hauling*, sold by him, Smith, 
 thai amount being then in his (Smith's) hands. 
 Very respectfully', 
 
 TIMOTHY Q. DWIOHT; 
 
 Special Agent. 
 
 .1. I*, (ii rmni;, I'srj 
 
 Supet biting Special Agent. 
 
 It will be seen by Mr. Allah n's letter that this is not acknowledged. His 
 letter is as follows. Mr. Allaben has been, since bis removal from the office of 
 Storekeeper, appointed to that of weigher in the custom-house: 
 
 New Yohk, July 14, 1866. 
 
 Sik: I had charge of the appraisers' stores near twenty-time months. 
 
 In November, 1865, there was sold to II. II. (Yagie, plumber, then doing work 
 in the stores, old b ad pipe amounting to SI 0~>, and in .January. ls(i(i, old iron, 
 old iron pipe, and old lead, amounting to •><;!> He had bills against the 
 
 United States for work done in the stores, and the amounts named were credited 
 and allowed in said bills in pari liquidation of tin- same. 
 
 An accumulation of old Btove-pipe, old broken stoves, old gas-pipe, and old 
 iron, amounting to 00. in December. 1M).">, was sold to one Bu.-hnell, who 
 
 represented himself as doing business al 1"»1 West street, and presented his 
 card. He was permitted to remove said material without paying for it, it being 
 confidently expected that he would call in a day or two and hand over the 
 amount; but not hearing from him in a reasonable Length of time, I sent to his 
 pretended place of business, and found that he had told me a falsehood; that he 
 had no place of business there. I then employed a detective, and, after some 
 trouble ami expense, found tint he waa a cheat; had by false pretences procured 
 iron from others, and was then iu'ja 1. No part of that bill baa been collected. 
 I believe this includes substantially all the refuse stuff sold at s ii 1 stores while 
 I was there, except that arising from merchants' packages, and which could not 
 well be returned, in opening and closing the packages and repacking the goods. 
 This was made up in*value of about one-half waste-paper, one-quarter bits of old 
 rope and cans ass, and about one- quarter pieces of old hoop-iron, and some other 
 small matters. It was argued that the stuff belonged to the merchants and not 
 to the government. I learned that it had been customary to deal liberally with 
 the laborers touching this refuse from packages, many of whom are quite poor, 
 by giving to them in small quantities such portions as might seem to be of use 
 to them, and that the balance had been sold and the proceeds used in liquida- 
 tion of divers expenses to which the storekeeper might be subject; such as re- 
 placing boxes broken in the store, payment of small allege^ abstractions of 
 goods in store, extra detective service, donations to wounded soldiers, and such 
 other objects of charity as the storekeeper, from his position, could not well 
 refuse, &c. Said refuse not giveu away was sold, and the proceeds expended 
 in the manner indicated herein. I did not find that any accurate account 
 had been kept of the receipts and disbursements on account of said fund, and 
 i kept none. I should judge that while I was there the sales amounted to seve- 
 ral bundled dollars, and I am satisfied that I disbursed as much and more than 
 I received. 
 
 Believing that in this matter I have not materially departed from the foot- 
 steps of my predecessors, that no wrong has been done, and tiusting that all 
 storekeepers will be treated alike, 
 
 I am, very respectfully, your obedient servant, 
 
 J. B. ALLABEX. 
 
 Mr. Guthrie, 
 
 Supervising Special Agent, Sfc. 
 
NEW YORK CUSTOM-HOUSE. " 135 
 
 #. 
 
 The refuse of the public stores amounts to a very large sum of money, and 
 that money properly belongs to the United States. 
 Q. Where does this money go to? 
 
 A. The storekeeper, Allaben, has appropriated it to his own use, I suppose. 
 Q. How do you know that? 
 
 A. From the tenor of his letter just read. In relation to the public stores, as 
 now conducted under Mr. Cook, I have to state that it has been considered that 
 four men, and not to exceed six men, were necessary at the hatchways for 
 hoisting and lowering goods ; in the busiest season of the year not to exceed 
 six. During the mouths of November and December, 1866, seventeen men 
 have been known to be at one hatchway, but all could not work. During that 
 time four were appointed one day at the request of the Hon. John Morrissey. 
 
 Q. What do you know with relation to the appointment of men to office under 
 the new appraisers' bill — of men guilty of offences under the old regime? 
 
 A. Charges were made to me, during my administration as special agent, 
 against Mr. Hart, an " examiner," for having received pay, both directly and 
 indirectly, from importer?, which amounted to 8100 or more, which was paid by 
 said importers in a check for $50, in one instance, and which was indorsed by 
 Hart ; and in another instance money was paid by theee same importers to the 
 amount of S50 upon an order from Hart, upon which he says : " If you will let 
 me have this money, anything which I can do for you here will be done with a 
 great deal of pleasure." The money was paid by the importers, Messrs. Hart- 
 ung tic Co., 51S Broadway, and the complaints were transmitted to the Treasury 
 Department, and referred back to the board of appraisers, who examined into 
 the matter and reported the affair to the Secretary of the Treasury. Complaints 
 were likewise made to me by same importers against Mr. Carter, another " ex- 
 aminer," in the appraisers' department ; and affidavits likewise made, (as in the 
 case of Hart,) and by the Messrs Hartung, of his dissipation and drunkenness, 
 and calling in such a state at their store with invoices of other importers, which 
 he exhibited to the Messrs. Hartung, which is strictly contrary to the regula- 
 tions of the Treasury Department. Those complaints were likewise sent to the 
 Treasury Department, and referred back to the board of appraisers. Charges 
 were likewise repeatedly made to me against Mr. Graham for wrongs done in 
 examining and appraising goods, and errors committed in office during the 
 months of May, June, and July, for and against the government, amounting to 
 over fifty invoices, and which were returned from the custom house for correc- 
 tion. Jn one instance a large number of bales of rags for the manufacture of 
 paper was returned as " unstemmed tobacco." I transmitted to Supervising 
 Special Agent Guthrie, at Washington, a large number of invoices on which he 
 had made errors, believing that the invoices themselves were the best evidences 
 of his want of knowledge to conduct his business. On the 29th day of August, 
 the day prior to the day on which the appointments were to be made under the 
 new bill reorganizing the appraisers' department, Mr. Guthrie wrote me a letter, 
 marked "unofficial." The following is a copy of the letter: 
 
 Treasury Department, August 29, 1866. 
 Sir : I herewith enclose the invoices referred to in your communication of 
 the 20th instant. These invoices certainly show a very bad record for Exam- 
 iner Graham, and must damage his prospects for promotion very much. Please 
 have the invoices restored to their proper place in the custom-house. 
 Very respectfully, your obedient servant, 
 
 J. B. GUTHRTE, 
 Supervis'nig Special Agent. 
 
 T. C. D wight, Esq , 
 
 Special Agent, fa., Kew York. 
 Unofficial. 
 
13G - NEW YORK CUSTOM-HOUSE. 
 
 Messrs. Hart, Carter, and Graham Mere reappointed as examiners under the, 
 new appraisers' bill; and Robert Church, an assistant appraiser, and .Mr John 
 C. Hopper, ail examiner, two good and hono-t men, were left out by Mr. McEl- 
 ratli, perhaps for exposing wrongs done there, to me. 
 
 With regard to the funds in the hands of storekeeper* accruing from the Bale 
 of "refuse," I have to say, thai knowledge came to the government l»y a note 
 of which the following is a copy: 
 
 Nkw Fork, August 16, 18C6. 
 DEAR SlR : I have the honor to inform you thai I tliink it would be well if 
 the honorable Secretary would cause some disposition to he made of the funds 
 received by the storekeeper at the public stores, from the sale of the refiuf 
 paper, rope, bagging, old iron, and oil' haulings generally, different from what is 
 now made of it. 
 
 The amount which will he received this year will probably be more than any 
 previous year, and will be something of an item. 
 Very respectfully, 
 
 TIMOTHY 0. DWIGHT, 
 
 Special Agent. 
 
 J. B. Guthrie, Esq., 
 
 S//j>crrisi//g Special Aiivut. 
 
 Inspector (Jodine was removed upon charges made to the surveyor, for having 
 received a bribe of five dollars for passing goods on the wharf which were sub- 
 ject to dn'y, without the payment of duty. A few days afterwards I heard 
 that he had been reappointed as storekeeper. 1 called on the collector to as- 
 certain whether it was so or not. The collector being absent, I applied to his 
 private secretary, Mr. Brown, who informed me that he h:id been appointed 
 storekeeper at the special request of a large number of Methodists of the church to 
 which Mr. (iodine belonged ; that they came down upon the collector like a 
 perfect avalanche for his reappointment. 
 
 Examiner Hendricks obtained $100 on a loan from Louis Jegel, corner of Ex- 
 change Place and New street, upon his check on one of the banks of the city. 
 Mr. Jegel, upon application to the bank for the money, was told by the paying 
 teller that he did not know Mr. Hendricks, and that he did not keep an account 
 at the bank. Mr. Hendricks was called upon by Mr. Jegel, and informed of 
 the result of the application for the money at the bank, and he replied that he 
 had made an error In the drawing of the check and had drawn upon the wrong 
 bank. He then gave him another check upon another bank for the same amount, 
 and upon Mr. JegePs applying for the money, was told the same thing as told 
 at the other bank. I reported the matter to Supervising Special Agent Guthrie, 
 for his action, who proceeded in the matter. Mr. Hendricks has since been re- 
 appointed under the new appraisers' bill, upon a more important position and b 
 larger salary, I am told, by Mr. McElrath, the appraiser general. 
 
 T. C. DWIGHT recalled. 
 By the Chairman : 
 
 A. In relation to the sampling of sugar, I have been officially informed from 
 various sources that are of a reputable character that the samples procured by 
 the samplers from the sugar are not of such standards as the invoices call for — 
 that is, for instance, the highest standard or best quality of sugar is mentioned 
 in the invoices ; a lower standard of samples is carried to the appraiser's de- 
 partment ; and, for instance, that the second quality of sugar being called for on 
 the invoices, a still lower standard is carried to the appraiser's department. 
 
 Q. Who takes the samples and carries them to the appraisers ? 
 
NEW YOEK CUSTOM-HOUSE. 137 
 
 A. The samplers ; and if they have more than they can carry, they have an 
 assistant with them. 
 
 Q. What do you mean by more than they can carry ? 
 
 A. They are done up in several packages of paper. If the weight is greater 
 than they can carry they have assistance. 
 
 Q. What motive or inducement can there be to carry a less standard than 
 what the invoice calls for ? 
 
 A. Such a course would favor the importer. The duty would be less. 
 
 Q. What do you mean by saying, " if the quantity is very great, it is neces- 
 sary for them to have an assistant to help them carry it ?" 
 
 A. Sometimes the invoices may call for a number of hundreds of hogsheads. 
 The rules require that one hogshead in ten should be sampled. In a large 
 number of hogsheads there would be more samples than one man could carry. 
 
 By Mr. B room all : 
 
 Q. Do you mean to convey the idea that the samplers are deceived, or that 
 they are dishonest ? 
 
 A. Well, sir, the information to me is that they are dishonest. 
 
 New York, December 18, 1866. 
 WILLIAM McIXTYRE sworn and examined. 
 
 By Mr. Rollins : 
 Q. State your residence and occupation. 
 
 A. I reside at 224 West Twenty-fourth street, and am now a broker. 
 Q. Do you know Henry A. Sm \ the, the collector 1 
 A. I have been introduced to him. 
 Q. How long have you known him 1 
 A. About eight months. 
 
 Q. Were you ever engaged in any warehouse where general order goods were 
 stored 1 
 A. I was. 
 Q. When? 
 
 A. From 1857 to 1861, at 371 Washington street, and 56 and 58 Greenwich 
 street. 
 
 Q. Who was collector at the time ? 
 A. Augustus Schell. 
 
 Q. Did you or your firm pay to the collector or to any official any sum for 
 this privilege 1 
 A. No. 
 
 Q. Had you any conversation with Mr. Smythe in reference to the cartage 
 of imported merchandise ? 
 
 A I put a proposition in before the collector for the cartage to and from the 
 bonded warehouse to the appraisers' stores. 
 
 Q. What was that proposition ? 
 
 A. Fifteen thousand dollars a year. 
 
 Q. Which you were to pay for the privilege ? 
 
 A. Y^es, sir. 
 
 Q. To the collector ? 
 
 A. I presume it was to the collector. 
 
 Q. Had you any conversation with him in reference to it 1 
 
 A. My papers were handed to Mr. Smythe, and referred to Mr. Embree. 
 
 Q. Did you have any conversation with any of them ? 
 
 A. I had with Mr. Embree. 
 
138 NEW YORK CUSTOM-HOUSE. 
 
 Q, What conversation took place with Mr. Embree f 
 
 A. When my proposition was handed to him he Raid he would take it into 
 consideration. After I called three or four times to see him his reply was to 
 ask me a question; first, whether I could not offer to give more than that, or 
 make it on a sliding scale — a percentage. 
 
 Q. Your offer was -$15,000 per annum? 
 
 A. Yes, sir. 
 
 Q. This was for the cartage? 
 
 A. Yes; to and from the bonded warehouse to the appraiser's store, where 
 they are sent for examination. 
 
 Q. Did you endeavor to procure this cartage from Mr. Smyths I 
 A. I did. 
 
 Q. Had you any conversation with him ? 
 A. But once. 
 
 Q. What took place then I 
 
 A. He told me to call on Mr. Emhree and lie would give me information. 
 Q. What cartage was this you desired to obtain I 
 
 A. The cartage of the goods thai are put in tie- warehouse, and from there 
 sent to the appraiser's office for examination, and then returned again to the 
 bonded stores ; and also the cartage from the steamers to the appraiser's store ; 
 that was included. 
 
 Q. Y'ou made this offer, then, of SI 5, 000 to the collector? 
 
 A. Y'es, sir. 
 
 ( v ). Did you ever receive any other reply than what you have stated ? 
 A. I received a reply from another party outside. lie told me I had not 
 offered enough. 
 
 Q. Who was that party? 
 
 A. I decline to answer. lie is not connected with the custom-house, and I 
 presume he will be before your committee. 
 Q. He told you you had not offered enough ? 
 
 A. Y'es; and asked me. if I would not raise it. He is not connected with the 
 government in any way. • 
 
 By Mr. BftOOMALL : 
 Q. What led you to make an offer of money for the cartage business? Was 
 it in any way invited ? and if so, by whom ? 
 A. It was ; by the same party. 
 
 Q. Have you reason to suppose that the invitation came from the custom- 
 house ? 
 
 A. That I cannot answer ; I cannot tell. 
 Q. You mean you don't know ? 
 A. I don't know. 
 
 Q. Who was the party that made that suggestion; and who subsequently in- 
 formed you you had not offered enough ? 
 
 A. I don't think I have a right to answer that question. 
 Q. Y r ou decline to answer? 
 A. I decline to answer. 
 
 By Mr. Rolllvs : 
 Q. You say you had no answer directly from Smythe ? 
 
 A. It was referred to Mr. Embree. It appeared he had everything to do with 
 it. All my conversation on that subject was with him entirely. 
 
 Q. Was the cartage of imported merchandise, or any part of it, offered to you 
 for money 1 
 
 A. No further than that they asked me how much I would pay for it. 
 Q. Mr. Embree asked you ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 139 
 
 A. Mr. Embree asked me. He wanted me to make a distinct proposition, 
 which I addressed to the collector of the port of New York, which went before 
 him, and was referred back again to Mr. Embree. 
 
 Q. Then Mr. Embree made a suggestion to you to make the proposition 1 
 
 A. No ; but this friend of mine did. 
 
 Q. Mr. Embree wanted you to make a distinct proposition 1 
 A. He asked me if I could not increase it. 
 Q. If you could not give more ? 
 A. Yes, sir. 
 
 Q. What was your reply ? 
 
 A. I said, " No man can give more and make a living out of it." 
 Q. What did he then say % 
 
 A. He said, " Well, Mr. Mclntyre, you call in again and see if you cannot 
 modify that, and make it a sliding scale." 
 
 Q. What reason did he assign for a change of proposition ? 
 A. No reason at all. 
 
 Q. You were not offered a part of the business ? No other proposition was 
 made to you except this ? 
 
 A. This party asked if I would take a portion of it. 
 
 Q. Did he make any suggestion £ to the amount you should pay ? 
 
 A. Well, that brings in this party again. He asked me if I would increase 
 that to twenty thousand. My reply was, " I cannot do it. If any one else 
 . wants it they can have it." 
 
 Q. Did he abk you what you would give for half of it 1 
 
 A. I said I would not take half of it. 
 
 Q. Do you know if any other parties have offered a consideration for the 
 cartage ? 
 
 A. No one that I could swear to. 
 Q. Who has it now 1 
 
 A. I heard the name, but I cannot tell. One party belonged to my ward, 
 but he is dead now — John Lindsley. 
 
 Q. You offered S15,000 for this business; now, how did you«expect to get 
 that $15,000 back again ? 
 
 A. By fair legitimate business. 
 
 Q. Did not you expect to raise the rates of cartage 1 
 
 A. Not a bit. 
 
 Q. Would the rates allowable by law be sufficient to enable you to pay 
 $15,000, in your judgment 1 
 
 A. Yes, sir I had the figures of an experienced man for it. 
 
 Q. If a man paid more than that, could he afford to do it. without increasing; 
 the rates ? 
 
 A. I suppose I expected to make ten thousand dollars over and above the 
 fifteen thousand, and that would be divided between the boss cartman and my- 
 self. I would have to lay out $7,000 or SS,000 for horses. 
 
 Q. Do you know George F. Thomson ? 
 
 A. I do. 
 
 Q. Had you ever any conversation with him in reference to general order 
 goods'? 
 A. I had. 
 
 Q. Did he say he expected to make money out of the general ^>rder business 1 
 
 A. He did. 
 
 Q. What did he say % 
 
 A. He expected to make at least $10,000 a year out of it. 
 Q. Did he say how 1 
 
 A. Yes ; by getting the general order business and disposing of it. 
 
 Q. What facility did he say he had for getting the general order business ? 
 
140 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. Ho said it was promised him. 
 Q. By the collector ? 
 A. Yes. 
 
 Q Did he lay be was to have the farming out of the matter ? 
 A. He said he had it in his hands. 
 
 Q. Did he say anything ah >ut Collector Smyt lie's intentions to make money 
 out of the general order business 
 
 A. Well, you can construe what he said to mean one way or the other. He 
 said that to other parties. I offered him, if he would gel it, to furnish all the 
 money, to hire the stores, and to go in with hi n, and he need not do anything 
 in the business at all : J would take the whole charge and give him half the 
 profits. 
 
 Q. What did he say to that ? 
 
 A. The propositi on was entertained, and then afterwards he told me other 
 parties had to be taken care of. lie did not say directly that .Mr. Smythe was 
 to have it or not, but he led me to think so. 
 
 Q. That Smyt lie was to have what F 
 
 A. A certain share of the profits. 
 
 Q. Who were the other parties 1 
 
 A. He did not name them; he Bimpljfeaid other parties had to be taken 
 care of. 
 
 Q. Did he say they made propositions ? 
 
 A. He said there were three parties to have an interest. He did not name 
 them, nor did he say how much they were to have. 
 Q. He did not say how much they proposed to give ? 
 
 A. Not an til afterwards. He asked me if $40,000 was too much to pay for 
 the general order business. 
 
 Q. What reply did you make ? 
 
 A. I said whoever agreed to pay it would never pay it. 
 Q. Could they not increase their charges ? 
 
 A. If the collector thought fit to allow them to do it, they could do it. 
 
 Q. Suppose a man should pay forty thousand dollars for the general order 
 business, what course do you think he would take ? 
 
 A. I suppose he would increase the rates of storage and cartage and every- 
 thing else. 
 
 Astor House, New York, December 19, 13G6. 
 BARRET H. LANE, of the firm of E. C. Johnson & Co., bonded ware- 
 housemen, Nos. 4, G, 7, 8, and 10 Bridge street, New York, sworn and examined. 
 
 By Mr. Broom all : 
 Q. Will you state whether your firm has any of the storage of the general 
 order business ? 
 
 A. We have one district, not the whole of it — all of the lower part of the 
 city below Fulton street, on either side. 
 
 Q. Will you state, as near as you can, what proportion of the entire busim.-.-: 
 that constitutes? 
 
 A. About one-fifth. 
 
 Q. When did your firm take charge of the district mentioned 1 
 
 A. About December 1. 
 
 Q. Before that time who did it ? 
 
 A. We did it for some months before. 
 
 Q. Had you not the entire business ? 
 
 A. We had not. Mr. Johnson alone had. So I understood. 
 
NEW YORK CUSTOM-HOUSE. 
 
 141 
 
 Q. Do you know anything about an agreement between Mr. Smythe and 
 Messrs. Miller & Conger respecting the general order business ? 
 A. Nothing but hearsay. 
 
 Q. From whom did you get your information ? 
 A. It was the general talk among storage men. 
 Q. Did Mr. Johnson tell you anything about it ? 
 A. No, sir. 
 
 Q. Did you or your firm, pending the negotiations with Miller & Conger, offer 
 more for the entire district ? 
 A. JiYe did not as a firm. 
 Q. uo you know whether any one had ? 
 A. I do not, sir. 
 Q. Did Mr. Johnson? 
 
 A. Never heard him say anything about it. 
 
 Q. From whom do you hold your present district ? 
 
 A. From Myers & Smith. 
 
 Q. What business are Myers & Smith in ? 
 
 A. In the same business. 
 
 Q. Where is their place of business ? 
 
 A. 397 Greenwich street, and up town on Bank street, and, I believe, they 
 have stores on the other side of the town. 
 
 Q. State under what terms you hold your district from Messrs. Myers & Smith ? 
 
 A. We pay them §5,000 for it. 
 
 Q. When was that agreement made ? 
 
 A. On the 1st of December. 
 
 Q. With whom was it made ? 
 
 A. I do not know. Mr Johnson made the agreement with Myers & Smith. 
 Q. Was the agreement in writing ? 
 
 A. Yes ; although I have not seen it. At least, I think it is. 
 Q. Were you not present at the time the agreement was made ? 
 A. No, sir. 
 
 Q. You had no conversation with Messrs. Myers & Smith relating to the 
 agreement ? 
 
 A. No, sir. Mr. Johnson perfected the whole arrangement. 
 Q. From your knowledge of the business of your district, what percentage is 
 $5,000 of the entire district ? 
 A. I corld not say. 
 
 Q. Give some guess. Would it amount to thirty-five per cent.? 
 A. Yes, sir. 
 
 Q. Would it amount to more? 
 A. I think not. 
 
 Q. Do you know to whom this money was paid ? 
 A. To Messrs. Myers & Smith. 
 
 Q. Do you know whether they have used it for themselves ? 
 
 A. I do not know ; never heard them say anything about it. Never spoke 
 to either of them except to pass the time of day. 
 
 Q. What induced you to offer so large a proportion of the profits? 
 
 A. We would have given any party a percentage in our business — thirty-five 
 percentage on the storage. 
 
 Q. Do you know whether Edwards, Atkins & Go. have any part of the busi- 
 ness of general order storage? 
 
 A. They have not now. They had prior to December 1. 
 
 Q. Do you know what they paid ? 
 
 A. Thirty per cent, of the" storage. I do not 'know that only by hearsay. 
 That is what we paid prior to December 1. 
 
 Q. Have Miller & Conger any part of it now ? 
 
142 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. I do not know, sir. 
 
 Q. Did Ooe & Lawrence have any part of it? 
 A. 1 do not know, sir. 
 
 Q. Do you, or does anybody wit Inn your knowledge, collect money from 
 transfer cart men for their privilege, or for any purpose ( 
 A. No, sir. 
 
 Q. How much altogether have you paid Johnson originally, and how much 
 have you paid Myers & Smith? 
 
 A. We have not paid Myers cV Smith anything. J cannot say positively 
 about Johnson, but it is in the neighborhood of -SoOO. ^ 
 
 Q. Do you, or does Mr. Johnson, pay anything to G. F. Thomson ? 
 
 A. I do not know, sir. 
 
 Q. Nothing to Collector Smythe? 
 
 A. No, sir. 
 
 Q. Do you know whether Mr. Thomson has an office «in the stores in Bridge 
 Street 
 
 A. He has no office there, but he has his letters sent there — perhaps one or 
 two letters per week. He has not been there for a month. 
 Q. Where is his place of business I 
 A. I do not know. 
 Q. Has he any place of business ? 
 A. I do not know. 
 
 Q. Is he any way interested with you or with Mr. Johnson ? 
 A. I do not know. I never heard Mr. Johnson say anything about it. 
 Q. Have you ever had an interview with Mr. Smythe with relation to the 
 general order business ? 
 A. Never. 
 
 Q. Did you, or any member of your firm, agree to pay to any person connected 
 with the revenue department any sum whatever for the transfer of goods from 
 the appraisers' store to your warehouse ? 
 
 A. Mr. Johnson may have done so. 
 
 Q. Do you know from him whether he did or not? 
 
 A. I never heard him say anything about it. 
 
 Q. What is your knowledge upon that subject? 
 
 A. I know that we received goods down there, and I gave Mr. Johnson a 
 check for so much per case. 
 
 Q. How much altogether did you pay Mr. Johnson? 
 
 A. Fifteen ceuts per package. I do not know how much altogether. 
 
 Q. Do you remember that your firm paid or agreed to p ly, loaned or gave, to 
 Daniel Jackson, of the custom-house, a thousand dollars or any other sum ? 
 
 A . We loaned him money at various times — small amounts — twenty-five dol- 
 lars or so. 
 
 Q. Has he paid any part of it ? . 
 
 A. He has not to me. 
 
 Q. Has he to anybody? 
 
 A. I do not know. 
 
 Q. How much altogether have you loaned him ? 
 A. Not more than a hundred dollars, 
 Q. Did you expect to be repaid ? 
 
 A. I did not expect to be repaid, hardly ; still, it was a bona Jide loan. 
 Q. It was, then, in your opinion, a gift? 
 A. Well, it amounted to that, sir. 
 
 Q. State what induced you to give Jackson this money ? 
 
 A. It was to gain his good* opiuion or favor, or something of that kind. 
 
 Q. With whom did you suppose he had influence ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 143 
 
 A. Well, he could have made us a great deal of trouble. He could have 
 thrown obstacles in our way. 
 
 Q. Did he make any attempt of that kind? 
 A. He did not, to my knowledge. 
 
 Q. Did the idea of a loan originate with you or with him ? 
 A. He asked for the loan of twenty-five dollars at a time. 
 Q. No part of which has been paid or is expected to be paid ? 
 A. Hardly. 
 
 Q. What position does he hold in the custom-house ? 
 
 A. Chief clerk at the public stores. 
 
 Q. "At what time was this money paid him ? 
 
 A. In the early part of last spring. 
 
 Q. State how he could give you a great deal of trouble, and whether that 
 was the reason for complying with his demand. 
 
 A. No, sir j that was not the reason exactly. We considered him a friend ; 
 but probably we would not have loaned it to him if he had not been in the cus- 
 tom-house. 
 
 Q. In what way could he give you trouble ? 
 A. He had the assignment of all those goods. 
 
 Q. Had he the power to send them elsewhere, and thus deprive you of your 
 business ? 
 A. No, sir. 
 
 Q. Then in what way could he give you trouble ? 
 
 A. He has the issuing of all the orders of those goods that were in the store. 
 He might have given us trouble in various little ways. 
 
 Q. Was it under his management that the goods were removed from the pub- 
 lic stores to your hands ? 
 
 A. I do not know, sir. 
 
 Q. State whether beside the moneys you have now spoken of you paid any 
 other moneys to anybody else in the custom-house. 
 A. I do not know, sir. 
 
 Q. State whether you had any demands made upon you for political purposes. 
 
 A. None upon me. 
 
 Q. Any upon Mr. Johnson? 
 
 A. Don't know positively. I heard him say there had been. 
 Q. Did he state by whom ? 
 A. He did not. 
 
 Q. Did he state the purposes ? 
 A. He did ; political purposes. 
 
 Q. Connected with the recent elections in New York ? 
 A. I do not know, sir. 
 
 Q. Do you know when the demand was mtde upon Mr. Johnson ? 
 A. I think within the last three or four months. 
 
 Q. Did you have any general order business prior to Mr. Srnythe's ad- 
 ministration of the custom-house ? 
 
 A. Not since I have been in the firm 
 
 Q. Were you in the firm when Mr. Barney was in there ? 
 
 A. I was, from September, I860. I was clerk in the firm at that time — a 
 book-keeper. 
 
 Q. Do you know whether, during the time of any previous collector, your 
 firm paid a percentage or any money for the business ? 
 
 A. Yes, sir ; they did to Henry C. Bowen and to Mr. Lambert. Mr. Bowen 
 was editor of the Independent. 
 
 Q. Do you know the amounts paid to those gentlemen ? 
 
 A. Thirty per cent. 
 
 Q. What was the aggregate amount ? 
 
144 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. I do not know, sir. 
 
 Q. Can you give us an estimate ? 
 
 A. I cannot. 
 
 Q. How long did that continue? 
 A. For tli ce or four years. 
 
 Q. What portion of the general order business had your firm, then ? 
 A. We did not have any portion of* the North river side. It wan all on the 
 East river Bide. 
 
 Q. Who is this Mr. Lambert? What is his business ! 
 A. He was at that time a dry-goods merchant up town. 
 
 (J. Do you know anything about who directed your firm to pay these moneys ? 
 
 A. I do not know. 
 
 Q. What were the moneys paid for? 
 
 A. For the general order business. 
 
 Q. Do you know whether Mr. Johnson gets any portion of the money paid 
 from other districts ? 
 
 A. I do not know, sir; never heard him say. 
 
 Q. While he had the general order business he received thirty -five per cent, 
 from all the districts ? 
 A. So I understood. 
 
 Q. What was the inducement to pay him ? 
 
 A. Because he influenced the business in some way or another. 
 Q. Do you know the manner in which he influenced tie- business. I 
 A. No, sir. 
 
 Q. You never heard anything from him as to whether it cost him anything 
 to influence the business? 
 
 A. No, sir; I never heard him say it cost him a cent. 
 
 Q. Do you believe he received these moneys for the benefit of anybody 
 else? 
 
 A. I do not know that anybody else shared any part with him. 
 
 New York, Monday, December 17, 1866. 
 
 GEORGE W. HART sworn and examined. 
 
 By the Chair. max : 
 Q. What is your business ? 
 
 A. I am a warehouseman, doing business at 2S6 Water street, New York. 
 
 Q. Have you ever had anything to do with general order business ? 
 
 A. Yes, sir. I have been in that business about nine years ; first in the 
 capacity of clerk with P. Livingston ; since then with the firm of Merle, Son & 
 Co., and now with Frank Squires. General order business ceased coming to 
 our stores, I think, about the first of August, 1866 About that time I thought 
 to go into business for myself with a gentleman named Duck, who came to see 
 me in reference to going into this general order business. He stated that Mr. 
 E. C. Johnson got the general order business from the collector, Mr. Smythe, 
 and was to give him a certain portion of it. I immediately called on Mr. Johnson. 
 By Mr. Rollins : 
 
 Q. Who is Mr. Johnson ? 
 
 A. He is a warehouseman at 8 and 10 Bridge street. 
 Q. What has been his business heretofore ? 
 
 A. He has been a warehouseman for a number of years. The firm used to 
 be Squires & Johnson. I went down on purpose to see Mr, Duck, and met 
 him at the office of Mr. Johnson. Mr. Lane, one of the firm, was there, but Mr. 
 
NEW YORK CUSTOM-HOUSE 
 
 145 
 
 Jolmson was not in at the time I got there. I inquired what the terms were to 
 receive these general orders, and Mr. Duck said there was something to be paid, 
 but did not say what. He said we were to receive a certain portion of the 
 general orders, I think from Pier 23, East river, up to Corlear's Hook ; and on 
 all general orders sent to our store we should pay thirty-five per cent, on the 
 storage. I then inquired who received this money, and he said thirty per cent, 
 went to Mr. Smythe, the collector of the port, and five per cent, to Mr. E. C. 
 Johnson for his trouble, as any disputes in reference to overcharges Mr. John- 
 son should have to take upon himself to settle. Mr. Duck offered an amount to 
 Mr. Johnson. We did not come to terms ; T did not feel disposed to pay quite 
 that amount of money and run a certain risk. Aud after negotiating for about 
 a week or ten days I gave them my terms what I would do, and they did not 
 meet tliem and the matter fell through. 
 
 Q. This was under a contract that existed up to a recent period 1 
 
 A. Up to the first of this month. 
 
 Q. Who were the parties to this contract ? 
 
 A. The contract was not carried out between us. 
 
 Q. You were not negotiating directly with the custom-house officers, but Mr. 
 Johnson ; whom did he represent ? 
 
 A. The collector of the port, as I understood it. I understood this from Mr. 
 Duck, and also from Mr. Lane. My object in going to Johnson's office was to 
 know all the particulars of this business. 
 
 Q. Did you know the distribution that was to be made ? 
 
 A. Thirty per cent, to the collector and five per cent, to Mr. Johnson. The 
 whole general order business of the East and North rivers was given to him for 
 thirty-five per cent., and he, not being able to take it all in his stores, farmed it 
 out among his friends and charged them five per cent, for his trouble. 
 
 Q. How long did he have control of this general order business ? 
 
 A. I understand he had control of it to the first of January. 
 
 Q. What did you offer — what was your proposition? 
 
 A. I told Duck 1 would go in with him at the business, and, after the 35 
 per cent, was paid out, I would take half the profits. I should put in no capital, 
 nor hold myself any further responsible than to conduct part of the business. 
 I had a very remunerative situation at the time, and did not wish to throw it up. 
 
 Q. Did he decline your proposition ? 
 
 A. No, sir; not then. He continued for a week or better negotiating with me, 
 until (I think this must have been in the latter part of the week) the following 
 Saturday, when he promised to meet me on the next Monday and settle the 
 matter. Then I heard from another gentleman that lie had received the same 
 offer from Mr. Duck, who told him the same thing he told me ; and that ended it. 
 
 Q. You made no contract ? • 
 
 A. No, sir. 
 
 Q. With whom did Johnson then make a contract, or farm this matter out ? 
 
 A. It was then farmed out, as I understand, to the firm of Miller & Conger, 
 who received the general orders, but what they paid I cannot say. They 
 are receiving it to this day. In reference to their first contract, that fell through ; 
 but they took up a smaller portion by paying thirty-five per cent, to Mr. John- 
 son, as I understand. We have had many cases of general order goods trans- 
 ferred from their stores to ours under a warehouse transfer. 
 
 Q. Have you any means of knowing what they pay ? 
 
 A. It is generally stated that they pay 35 per cent, for a certain portion run- 
 ning fi om pier 37, East river, to pier 50, East river. 
 
 Q. Do you know anything of the disposition that was to be made of this 30 
 per cent, that went to the collector ? 
 
 A. Nothing further than what Mr. Lane, a partner of Mr Johnson's, told me 
 H. Rep, Com. 30 10 
 
14G 
 
 NEW YORK Cr.STOM-IIOrsE. 
 
 when I went to the office of Johnson & Co. to see liim, but did not do 10, u 
 lie was in another portion of the building. Mr. Lane made no secret of the 
 matter as to who received the money. 
 
 New York, Tuesday, December 18, 18GG 
 
 ROBERT EDWARDS sworn and examined. 
 
 By the Chairman : 
 Q. State your place of residence and profession ? 
 
 A. I am a warehouseman at No. 2S6 West Houston street, New York, 
 and a member of the firm of Kdwards, Atkins \ Co. 
 Q. Have yon any part of the general order business ? 
 A. I had part of it up to the first of this month. 
 Q, When did you gel this business \ 
 A. 1 think on the I Oth of August last. 
 
 Q. W.ll you state how you obtained the business? 
 
 A. Mr. E. C. Johnson had the general order business of the city, and made 
 arrangements for us to tak" a certain district. 
 
 Q, You took it under .Johnson / 
 A. Yes. 
 
 Q. Will you state how much you gave him for it? 
 
 A. Thirty-five per cent, of the gross receipts of the storage. 
 
 CE Do you pay this to Mr. Johnson himself! 
 
 A. Yes, to his order. 
 
 Q. How much have you paid him altogether? 
 A. 1 cannot say. 
 
 Q. A V i 1 1 you give us an estimate? 
 A. I cannot. 
 
 Q. Was your agreement in writing? 
 
 A. We never had any agreement in writing. 
 
 Q. Had you ever an interview with any other person except Johnson in ref- 
 erence to this business ? 
 
 A. 1 cannot think of any direct interview. Of course I talked with other 
 parties. I talked with the superintendent of warehouses about details. 
 
 Q. Had vou any interview with Thomson in reference to this business ? 
 
 A. No. 
 
 Q. Did Mr. Johnson say what was to be done with this money? 
 A. He did not. 
 
 Q. Did he say it was to be pocketed by him exclusively, or was it to go to 
 any one else ? 
 
 A. I cannot say he ever said anything- about it. 
 
 Q. From your knowledge of the business, what do you think 35 per cent, of 
 tbe general order business would be worth a yeai ? 
 
 A. It would be impossible for me to give you an opinion worth noticing, as 
 I had it only for a dull part of the year. 
 
 Q. Would it be worth more than $30,000 ? 
 
 A. It would. 
 
 Q. Do you think it would be worth $50,000 ? 
 A. Do you mean 35 per cent, of the proceeds ? 
 Q. Y^es. 
 
 A. I don't think 35 per cent, of the proceeds would be worth 850,000 a year. 
 Q. Was anything said by Johnson about your means of making money, 
 through the influence of .the custom-house, in allowing you to charge high rates ? 
 A. JS'o ; I always understood that we were never to allow our charges to ex- 
 
NEW YORK CUSTOM-HOUSE 147 
 
 ceed what had been previously the general order charges. Those were his in- 
 structions, and I considered myself subordinate to him. He told me to have 
 the charges as low as they ever had been. 
 Q. Who has the section now that you had ? 
 
 A. Myers & Smith ; they are said to have the whole of the business. I have 
 offered them to do a district for them. 
 
 By Mr. Rollixs : 
 Q. You had some conversation with Mr. Thomson ? 
 
 A. I have talked a great deal with him, as I understood he was a very influ- 
 ential man. 
 
 Q. Who do you suppose him to have influence with ? 
 
 A. With the collector of the port ; and I suppose also with the Secretary of 
 the Treasury. From what I have heard of Thomson, I think he has influence 
 with many public men. 
 
 Q. What has been his position that entitled him to such consideration ? 
 
 A. I cannot say. 
 
 Q. What was his position 1 
 
 A. I cannot tell. I tried to find out his place of business, and could not do 
 so ; nor could I find out his addiess. I understood he had been a reporter once 
 for some of the newspapers. 
 
 Q. What conversation had you with him ; did you speak of the general or- 
 der business to him ? 
 
 A. Yes ; we talked about it. 
 
 Q. Did he say he had an interest in the matter? 
 
 A. He said he had not. 
 
 Q. Then why did you speak about it to him 1 
 
 A, Because I believed he had an interest in the matter. I did not believe 
 him when he said he had not. 
 
 By Mr. Broomall : 
 Q. Did he tell you he had an interest in the business ? 
 
 A. No, he did not. I was very anxious to find out who had an interest in 
 it, and I never could find out who had. 
 
 New York, January 9, lS67w 
 HAMILTON FULTON sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you connected with the custom-house ? and if so, in what capacity ? 
 
 A. I am, as general order clerk. 
 
 Q. How long have you been general order clerk7 
 
 A. Since January, 1864. 
 
 Q. Are the general orders made out at your desk 1 
 
 A. They are not made out by me, but by another gentleman, and then sent 
 to me, and I direct what stores they are to go to. 
 Q. Who directs you what stores they are to goto 1 
 
 ■ A. I receive the orders from my superior officer, Mr. Steadwell, which I here 
 give you, appended to a letter from Mr. Johnson requesting the goods to be so 
 distributed : 
 
 New York, Avgust 6, 1866. 
 Dear Sir : Please send general order goods for the district above Chambers 
 street, on the North river, to the stores numbered 363 and 364 West street, and 
 numbers 157, 159, 161, 163, 165, and 167 Leroy street- 
 
148 NEW YORK CUSTOM-nOUSE. 
 
 Also, please -cud general order goods for the district below Chambers 
 street to the Battery, on the North river, to -stores numbered 4, 6, 8, and 10, 
 Bridge street, and oblige, very truly, 
 
 E. C. JOHNSON. 
 
 J. H. 8'1'KA DWELL, Esq., D. C. 
 
 Mr. Fulton will nlea.se observe this above request in all future general orders. 
 
 j. ii. b, d. a 
 
 New York, August 7, 186G. 
 Dkar Sir : Please send general order goods for the district, on the East 
 river, above pier 50, to bonded warehou.-es numbered 7 15, "< I s , 750, and 7.75 
 \Y;it( r street. 
 
 Please send general order goods on the East river, from pier 25 to pier 50, to 
 bonded wan houses numbered 271, 272, 273, and 274 South street. 
 
 Also, please send general order goods on East river, from below pier 25 to 
 the Battel v, to bonded warehouses numbered 4, G, 8, and 10 Bridge street, and 
 oblige, yours, very truly, 
 
 E. C. JOHNSON. 
 
 J. II. Stba dwell, Esq., D. C. 
 
 Please observe this request until further directions. 
 
 J. II. S., D 
 
 Q. Were the goods sent in accordance with these letters ? 
 A. Yes. 
 
 Q. lias there been any alteration in the distribution of the general order 
 goods since you received those letters 1 
 A. Yes. 
 
 Q. Who gave the directions for that alteration? 
 A. It came direct from Mr. Smythe himself. 
 Q. Was it by letter? 
 A. Yes. 
 
 Q. Can you produce that letter ? 
 
 A. Yes ; but I have not it with me now. 
 
 Witness subsequently appeared, and handed in the following letter : 
 
 Custom-house, X. Y., Collector's Office, 
 
 December 1, 1866. 
 
 Sir : The bonded stores 393, 395, and 397 Greenwich street, and the 
 bonded store at the foot of Bank street, North river, are hereby designated as 
 general order warehouses, in lieu of Nos. 363 and 364 West street, and 157 
 to 167 Leroy street, in this city. You will please act accordingly. 
 Yours, &c, 
 
 H. A. SMYTHE, Collector. 
 
 J. H. Steadwell, 
 
 Collector of Third Division. 
 
 All above Canal street to go to Bank street store ; all from Chambers street 
 to Canal to go to 393 Greenwich street. 
 
 J. H. S., D. C. 
 
 JOHN T. WAY sworn and examined. 
 
 By the Chairman : 
 Q. What is your business ? 
 A. I am in the storage business. 
 
NEW YORK CUSTOM-HOCSE. 
 
 149 
 
 Q. Look at the following receipt : 
 
 United States Bonded Warehouse, 
 
 Nos. 4, 6, 8, and 10 Bridge street 
 
 Marks. 
 
 Description. ! Months. 
 
 Storage. 
 
 Labor. ' 
 
 Cartage. 
 
 Total. 
 
 R. & B. 
 
 j 4 
 
 1 
 
 $16 00 
 
 $4 00 
 
 $4 00 
 
 $24 00 
 
 Freight, gold, 813 20. 
 
 Received payment for E. Johnson & Co. 
 
 New YORK, December 20. 
 
 State whether the charges correspond with the rates fixed in the custom- 
 house manual. 
 
 A. They do not. They charge fifty cents per cask. The lawful charges 
 are twenty cents ; the same for labor. The charge fifty cents per cask for cart- 
 age should be thirty-three cents. This is a receipt for storage, labor, and cartage 
 to-day. 
 
 Q. Do you speak of the rates as found in Mr. Bruce's book, and are they the 
 usage ? 
 
 A. Yes, sir. 
 
 Q. It is stated that an allowance of sixty per cent, is made and accepted 
 here. 
 
 A. There is no foundation for that, except in individual cases. There is no 
 such usage among warehousemen. 
 
 Q. After allowing the sixty per cent, to the usual rates, how would it then 
 conform to this receipt? 
 
 A. Thirty-two cents storage and thirty-two cents labor; they have it here 
 more than one hundred per cent. 
 
 New York, Monday, December 17, 18G6. 
 DAVID M. STOXE sworn and examined. 
 
 By Mr. Broomall : 
 Q. W.iat is yoiir position? 
 
 A. I am president of the Journal of Commerce corporation, and one of the 
 editors of that journal. 
 
 Q. Do you know anything as to overcharges for warehousing and cartage 
 under the present collector of this port 1 
 
 A. I have had frequent cases of overcharge brought to me for decision, and 
 in all cases, having either publicly or privately stated what the proper charge 
 should be, I know that the deduction so made to the proper charge has been 
 the one accepted; and this has frequently amounted to a very large difference. 
 
 Q. Why were these overcharges brought to you'? 
 
 A. Because I had first called public attention to the fact (as editor of the Journal 
 of Commerce) that such overcharges would be the result of the corrupt sale and 
 bargain going on. Having given attention for many years to this subject, I 
 was familiar with the charges proper to be made. 
 
 Q. Will you state how the charges are fixed, and by whom ? 
 
 A. The law prescribes that the goods may be stored, and that the charges 
 may be fixed by the Secretary of the Treasury, not to exceed the customary 
 charges at the port. And the Secretary has instructed the officers that whenever 
 there is a dispute about what the customary charges of the port are, the rates 
 established by the Chamber of Commerce shall govern. So I had something 
 
150 
 
 NEW YORK CUSTOM-HOUSE. 
 
 to go upon in all capes. The rates that should be charged arc considerably un- 
 der the rates of the Chamber of ( .'ommerec. These latter arc the outside limit, 
 and the proper charge should be from one-hall' or two-thirds to three-fourths of 
 these rates; but the charges made in some cases were three time- t h< rates. 
 Q. By whom were*these bills made out ? 
 
 A. By the different warehouses. In one case Mr. Johnson himse lf made out 
 the bill in his name for the district. In other cases they were made out by the 
 persons to whom it had been given by the collector. 
 
 NEW FoBKi December IS, 1SG6. 
 
 R. P. GETTY sworn and examined. 
 
 By Mr. Broomall : 
 Q. Where do you do business ? 
 A. No. 115 Greenwich street. 
 
 Q. You are the proprietor of the buildings known as "Getty's stores ?" 
 A. Yes, sir. 
 
 Q. Were you, in March last, in negotiation to lease them to the government ? 
 A. Yes, sir. 
 
 Q. State at what sum you originally ottered them per annum? 
 A. At $40,000 and tax. s. 
 
 Q. When the officer refused to pay you taxes state whether you changed it 
 to any other sum. 
 
 A. I changed it to S45,000, I paying the taxes. 
 
 Q. No arrangement was made prior to Mr. Smythe going into office? 
 A. No, sir. 
 
 Q. Please state your first interview with Mr. Smythe, when and where it 
 took place, and what was said [ 
 
 A. After Mr. Smythe had been confirmed and been in his office a day or two, 
 I met him in Downing's saloon, under the custom-house, and he made some al- 
 lusion to his having papers in his office in relation to my Storehouse, and having 
 written to the owners of the other stoie that is occupied in Broadway. The 
 matter then lay in abeyance for about a month, while waiting to hear from 
 Washington, without anything being said. Meantime I did not see Mr. Smythe 
 about it. 1 had an application from Messrs Miller & Conger to lease to them 
 the warehouse, and announced to them the day when they could call, but told 
 them I could not say anything about the leasing, nor lease it; that I was then 
 under embarrassment, but did no.t let them know what it was. I told them, 
 however, that if they would come next morning at eleven o'clock I probably 
 could have information by that time upon which I could talk to them. In the 
 morning at about ten o'clock I called on Mr. Smythe and told him there were 
 very responsible parties desiring to lease the store, offering to furnish any kind 
 of security. I said to him, " It may be that this has got out, and that some per- 
 son is trying to get between us and the government, and it would be a shame 
 for anybody to lease the stores of us and then lease them to the government at 
 a higher rent." He said, no, there was nothing of that kind ; that the gentle- 
 men were friends of his, to whom he should give a part of the general order 
 business ; but, said he, " If you will just write what you have stated to me and 
 hand it to my private secretary he will send it to Washington." I went and 
 wrote, as near as I can remember — " I have had a proposition for some time be- 
 fore you and have not heard from you whether you want them or not. Now re- 
 sponsible parties have made application, and are desirous of leasing. I wish 
 you would give me an answer at the earliest day." Two days then elapsed, 
 when Mr. Miller came in and told me he could relieve me from the embarrass- 
 
NEW YORK CUSTOM-HOUSE. 
 
 151 
 
 merit ; that be had been talking with his friend Mr. Smythe and Mr. S my the 
 had told him the whole story, and had said that the government did not want 
 them and I was free to engage them. I told him that, while I did not doubt his 
 statement, I ought to have official notification or see Mr. Smythe personally. 
 He then offered to go over and get this statement in writing. It was so late, 
 however, 1 told him I could not wait, but that the next morning I would go 
 over early and see Mr. Smythe, and then would talk to him. I did so, and Mr. 
 Smythe told me Mr. Miller's statement was true, and remarked, " At that time 
 I had no authorization, but since then I have got a despatch saying they don't 
 want it." 
 
 Q. Did he show you the despatch 1 
 
 A. No, sir. He turned around then and says, " Getty, I will give you 
 $35,000 per year for the stores." I told him I should do nothing of the kind ; 
 that the stores were worth more money, and more than what I asked the gov- 
 ernment. I passed out and immediately reported to Messrs. Miller & Conger. 
 Mr. Miller then made a proposition to me increasing the rent, as near as I can 
 remember, to $40,000. I took his proposition and looked at it. There were a 
 number of details in it which I cannot remember now. I told him I would 
 lease the stores on the precise terms offered by me to the government. They 
 concluded to take them, and to furnish such security as was perfectly satisfactory. 
 A day or two after that, while passing up Wall street, I saw Mr. Guthrie going into 
 the sub-treasury and I spoke to him. He inquired whether I had heard anything 
 from Washington. I told him I had, and that Mr. Smythe had told me the govern- 
 ment did not want the warehouses, and that I had leased them to Miller & Conger. 
 Says he, " Is that fixed ?" Says I, " It is so far as I am concerned, and is only 
 waiting such security as will be satisfactory." He then said, " If anything turns 
 up that this thing don't go through, will you be kind enough to keep me posted ?" 
 I told him I would. Messrs. Miller & Conger proceeded, had the lease drawn 
 up, and had some mason work commenced with a view to the insurance, ail of 
 which they did at their own risk. I then represented to him (Mr. Guthrie) 
 that they had some difficulty in getting the stores bonded at Washington, and 
 got out of him that he did not think they would get them bonded, as it was a 
 violation of the revenue laws ; that he did not think the collector had the power 
 or anybody else. About that time, when we had perfected the matter with 
 Messrs. Miller & Conger, the collector sent for me and said, " I simply sent for 
 you to know whether your stores were leised." I toll him they were, except — 
 he stopped me at once and said, " I merely wanted to hear from you yourself 
 that they are leased." Miller & Conger came there, and I saw they were very 
 anxious to get off, but told them if they would pay the expenses that they had 
 incurred there themselves I would let them off. In a day or two Mr. Smythe 
 sent for me and said the government would take the stores. 
 
 Q. Do you recollect the date of the letter as compared with the time he showed 
 it to you ? 
 
 A. I think I could find all. the dates. 
 
 Q. You have now leased them to the government? 
 
 A. Yes, sir. The lease commences payment the first of February. 
 
 Q. Had you been acquainted with Mr. Guthrie previous to the time you met 
 him in the sub-treasury ? 
 
 A. Yes, sir. He was the party who was said to have the matter in charge. 
 
 Q. Did Messrs. M Her & Conger tell you what they wanted the stores for ? 
 
 A. I understood from them that they had the general order business for the 
 north side of the town. 
 
 Q. Did you understand Mr. Smythe the same thing ? 
 
 A. lu the way I have stated, that he had given certain portions of the govern- 
 ment business to some friends, for which he supposed they wanted to rent the 
 stores. 
 
152 
 
 NEW YORK CUSTOM-JIOr.SE. 
 
 OBADIAB W. F. RANDOLPH sworn and examined. 
 By tin* Chairman : 
 
 Q. What is your business in this city 
 
 A. I have several branches of business. One is warehouseman, and likewise 
 produce merchant. 
 
 Q. Have yon any tiling to do with the general order business ? 
 
 A Only once, and that was temporarily, in lMi:;, when they were obliged to 
 use every bonded warehouse that could be obtained for general order goods. 
 Modt of* my store-room at that time — the Getty building — was used two or three 
 months. 
 
 (J. Have you had any negotiations with any person since that time with 
 reference to that business ? 
 
 A. No, sir. The business was not desirable to me. 
 
 By Mr. Broom all : 
 
 Q. Do you know anything about the attempt on the part of the Secretary of 
 the Treasury to base the Btorefl to Mr. Getty? 
 
 A. 1 know the stoics have been leased to Mr. Getty, because I was the party 
 to be consulted about it. 
 
 Q. Did you have an interview with Mr. Smvthe ? 
 
 A. No, sir. 1 had no interview with any official. The only interview I had 
 was with Mr. Getty himself, who was the owner of the stores, and I was a tenant 
 under billl. 
 
 Q. Have you any information about the negotiations, except what you received 
 from him ? 
 
 A. I may have got some information from parties who got their information 
 from him. My own foreman and my brother-in-law incidentally got their in- 
 formation from Mr. Getty, or from his son. 
 
 By Mr. Rollins : 
 Q. You were a tenant ? 
 
 A. I occupied all the front of Trinity Place. 
 Q. Did you have a lease ? 
 
 A. No. I have occupied it on sufferance, with the understanding that sufficient 
 notice should be given. It might have been perpetual so long as Mr. Getty 
 was satisfied. When he could do better he had a right to do so. 
 
 Q. He gave you proper notice? 
 
 A. Yes. The time fixed was the first of February. Somebody was allowed 
 to come in on the part of the government to make preliminary preparation. 
 Q. Is that the extent of your negotiation with him in the matter? 
 A. That is all. 
 
 By Mr. Broomall : 
 Q. State when he gave you this notice. 
 
 A. A little before the 1st of November. He says : " You may have to begin 
 to vacate on the 1st of November; but," says he, " you can go on and put in 
 goods, and I will let you know." Then the 1st of December was named, and 
 then the 1st of January. I have learned within a week or ten days that thej 
 would not take formal possession until the 1st of February. 
 
 Q. Do you know when the negotiations began ? 
 
 A. All I know about it is this : If you know r when the general order was 
 to be farmed out to Miller & Conger, they did negotiate and undertake to hold 
 these premises for general order business. They said they bad purchased it, 
 and that they had agreed to give Mr. Getty $45,000. They got permission 
 from me to brick up the rear windows, and make the building more fire-proof; 
 
NEW YORK CUSTOM-HOUSE. 
 
 153 
 
 and they Lad almost completed the bricking up when the general order business 
 was given to Mr. Johnson. 
 
 Q. Did you have any conversation with Mr. Johnson about it? 
 
 A. No, sir. 
 
 Q. Do you know whether the negotiations of the custom-house were sus- 
 pended while Miller & Conger were endeavoring to lease 1 
 
 A. I don't think any negotiations had been commenced. Mr. Getty told me 
 two or three years ago that it was intimated to him that they would be very 
 desirable stores for the government ; and his remark was : " I do not want any- 
 thing to do with the government officials. I had much rather negotiate with 
 you or any private person for letting those warehouses." 
 
 JOHN B. STEVENS sworn and examined. 
 
 By Mr. Rollins : 
 Q. What is your business, and where is your place of business 1 
 A. I am a lawyer ; my place of business is at No. 67 Wall street. 
 Q. Did you have anything to do with the general order business that is now 
 being done by Messrs. Myers & Smith ] 
 A. I did. 
 
 Q. With any other persons ? 
 
 A. No, sir. I was employed professionally by Messrs. Myers & Smith. 
 My relation to them is that of counsel to client. Although I know of nothing 
 in this matter to their discredit, yet I do not feel like saying anything until I 
 have seen them. 
 
 By Mr. Broomall : 
 
 Q. It is not -what took place between you and them, but what took place 
 between them and other parties. 
 
 A. I had nothing to do with other parties. 
 
 Q. You were acting to them as counsel in negotiations ? 
 
 A. They applied to me originally to draw up a petition six months ago, stat- 
 ing what they wanted, and I gave them the best of my advice how to get it 
 through, and, to facilitate them in that respect, referred them to persons who I 
 supposed would have influence. They applied once unsuccessfully ; they ap- 
 plied the second time, and, I believe, got the order. 
 
 Q. Did you see Collector Smythe during these negotiations ? 
 
 A. I saw him, but had no conversation with him. 
 
 Q. Did you have any conversation with Mr. Thomson about this matter % 
 A. No, sir. 
 
 Q. Did you hear any conversation between your clients and Mr. Thomson 
 and Messrs. Myers & Smith ? 
 
 A. There has been no particular conversation to my knowledge. I heard 
 some conversation about the districts, and whether the business had been prop- 
 erly done. 
 
 Q. Was any part of the conversation relating to what Messrs. Myers & 
 Smith were to give for the business, and to whom ? 
 A. Not a word. 
 
 By Mr. Rollins : 
 Q. Who is this Mr. Thomson 1 
 
 A. He is in the storage business. He was and is supposed to be very well 
 posted with all the routine of the custom-house and of the general order 
 business. Myers & Smith also are old and large storage men. 
 
 Q. Has that been Mr. Thompson's business for several years ? 
 
 A. Yes, sir. It was his business. I think he has been an editor ; I did not 
 hear of what paper. I think it was of some country paper up the river. 
 
154 
 
 NEW YORK CUSTOM-HOUSE. 
 
 By Mr. B room all : 
 Q. Was lie not connected with the News ? 
 
 A. Not that I know of. I am not sure whether it was lie or Judge Hoge- 
 boom from whom I heard this. 
 
 (,>. Do you know whether Messrs. Myers c\: Smith paid anything for this 
 business 1 
 
 A. I think they did not. 
 
 Q Who are the firm? 
 
 A. It consists of Henry J. Myers and Henry Smith. They have been in 
 the storage business sometime. 
 
 Q. Was Mr. Thomson c ncerned in any way in the business with them? 
 
 A I cannot say. Mr. Myers said he would employ him, provided be would 
 be of any use to them. 
 
 Q. Is Mr. E. 0. Johnson in any way connected with Messrs. Myers & Smith ? 
 
 A. No, sir. 
 
 Q. Do you know whether Mr. Johnson received money of any kind in the 
 course of his business I 
 
 A. No, sir. Lf he did, I would have known it. My impression is that the 
 arrangement with Messrs Myers cV Smith was a bona tide arrangement, without 
 any compensation. I think it was a general arrangement, that might continue 
 or not at the will of the collector. 
 
 Q. When was the arrangement entered into? 
 
 A. About the 1st of December. 
 
 Q. Do you know anything of the arrangement between Mr. Johnson and the 
 custom house, or any other parties ? 
 
 A. No, sir. In connection with the general order business Mr. Myers wanted 
 me to write an article or notice that the goods should be reduced to the original 
 storage prices, and to publish it when written; and I did so last Saturday, put- 
 ting it in preity nearly all the papers. 
 
 Q. Why was that done ? 
 
 A. Because there had been such constant complaints; and Messrs. Myers & 
 Smith thought this would be a profitable business. 
 
 Q Did that proceeding have any reference to this investigation, or to any 
 action taken by Congress ? 
 
 A. No, sir; I am pretty sure it did not. It originated in this wise: There 
 was some trouble about vessels. Complaints had been made^ to the collector, 
 and he made his positive directions, so that there should be no more question 
 about it. 
 
 By Mr. Rollins : 
 
 Q. When did the collector give this order ? 
 
 A. Some time during last week or since the 1st of December. 
 
 Q. Was Mr. Thomson employed by Messrs. Myers & Smith while they were 
 endeavoring to secure this general order business ? 
 
 A. No, sir ; I do not think he was. He met them at my office frequently. 
 He has met them there several times a week since they have been in active 
 operations. 
 
 Q. What is his connection now between them and this general order business ? 
 A. He has no connection with the general order business. My impression is 
 that they employ him as an ordinary clerk. 
 
 By Mr. Broom all : 
 Q. Do you know at what salary ? 
 A. No, sir. 
 
 Q. Did he perform the duties of an ordinary clerk ? 
 A. I do not know. 
 
NEW YORK CUSTOM-HOUSE. 
 
 155 
 
 Q. During the negotiations was anything said about their giving any consid- 
 eration or any present to Mr. Thomson ? 
 A. Not that I know of. 
 
 HENRY J. MYERS sworn and examined. 
 
 By Mr. Bkoomall : 
 Q. State your residence, business, and place of business. 
 A. My residence is upon the Hudson. I am in the business of storage at 
 Nos. 393, 395, and 397 Greenwich street, where my office is. 
 Q. What is the name of your firm? 
 A. Myers & Smith. 
 Q. What is Smith's entire name? 
 A. Alpheas A. Smith. 
 
 Q. Are you engaged in the general order business ? 
 A. Yes, sir. 
 
 Q. Do you know John B. Stevens ? 
 A. I do. 
 
 Q. Has he any interest at present in your business ? 
 A. No, sir. 
 
 Q. Have you the general order business now? 
 
 A. Yes, sir ; I have had it since the 3d of December. 
 
 Q. Do you know that Miller & Conger had at one time purchased that busi- 
 ness of the collector ? 
 A. I understood so. 
 Q. From whom did you understand it ? 
 A. From Mr. Bixby or some of the neighbors down there. 
 Q. Did you ever understand from Mr. Smythe anything about that bargain ? 
 A. No, sir. 
 
 Q. Who preceded you in the general storage business ? 
 
 A. Mr. Johnson, I think, told me that he had it afterwards. I also heard 
 Edwards & Atkins had. I did not make any particular inquiries. 
 Q. Did Mr. Johnson tell you upon what terms he had it? 
 A. No, sir. 
 
 Q. Do you know in any other way upon what terms Mr. Johnson had it? 
 A. I believe Mr. Johnson told me what terms he had with somebody. I 
 think Messrs. Miller & Conger paid him thirty-five per cent. 
 
 Q. Did he state whether he paid anything- for it to anybody else ? 
 A. No, sir. 
 
 Q. Do you know whether he did or not ? 
 A. I do not know. 
 
 Q. What led to your getting it ? Did you apply for it? 
 
 A. I applied a couple of times for it by petition to the collector. 
 
 Q. Did you see the collector about it yourself? 
 
 A. I saw him after I got it. 
 
 Q. Were yuu offering anything to anybody for it ? 
 A. No, sir. 
 
 Q. How came you to apply for nothing and get a business for nothing that 
 had been sold to Miller & Conger for $40,000 ? 
 
 A. I did not know it had been sold. I applied to get it, because there was 
 so much talk about it, and that it would enlarge our business, and that we could 
 do more justice to the merchants and satisfy them without any more complaints 
 of overcharges. 
 
 Q. Is there any arrangement between you and anybody else by which you 
 pay for this business ? 
 A. No, sir. 
 
156 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Have you paid anything to Mr. Smythe, Mr. Johnson, and Mr. Thorn 
 
 eon? 
 
 A. No, sir ; I engaged Mr. Thomson in our business. 
 Q. Where; is he employed? 
 
 A. He docs a gieat deal of outside business at the custorn-house, &c. 
 
 Q. At what rate do you employ him ? 
 
 A. At $2,500 a year. He wanted $5,000 a year. 
 
 Q. Did he give you any reason why he wanted 85,000 a year? 
 
 A. No ; he thought he was wortli that. 
 
 Q. Since you have had the general order business, have you paid anybody 
 but Thomson ? 
 
 A. No, sir; I believe I have not paid him yet. 
 
 Q,. What was your inducement to employ Thomson? 
 
 A. Well, In- was an old storage man and well posted up in storage affairs. 
 I had known him a long time, and he wanted employment; and I told him I 
 would give him a chance to do the outside business. 
 
 Q. Were you not obliged to employ him to get the business ? 
 
 A. No, sir. 
 
 Q. Did you negotiate with Mr. Smythe directly for the business, or through 
 Mr. Thomson? 
 
 A. I petitioned through all our customers to the collector. 
 
 By the Chairman : 
 
 Q. Who suggested to you to make an application by petition ? 
 
 A. Mr. William Moller. We negotiated with Mr. Smythe through John B. 
 Stevens. We sent down to Mr. Smythe through him. Our first petition we 
 did not hear anything of. When we found out our customers were dissatisfied 
 with the charges and they all wanted us to take the general order business, we 
 went to Mr. Stevens and asked him again to present the petition of our custom- 
 ers to the collector, and we assured him that we would give satisfaction to the 
 business, and Mr. Smythe gave us the order. 
 
 Q. I ask you again whether you negotiated with Mr. Thomson for the gen- 
 eral order business in any way ? 
 
 A. No, sir ; through Mr. Stevens alone. 
 
 Q. Do you state that you have no business with Mr. Thomson except em- 
 ploying him at a salary of S2,500 a year ? 
 A. None at all. 
 
 Q. Have you any business relations with Mr. Smythe connected with the 
 general order business ? 
 A. No, sir. 
 
 Q. Do I understand you that you employed Mr. Thomson solely as a business 
 transaction and not with a view to getting the general order business ? Did you 
 look upon him as having influence with the collector ? 
 
 A. Not at all. I did not expect to get any business through Mr. Thomson. 
 
 Q. Do you underlet this business to anybody or conduct it all yourselves? 
 
 A. Our stores are not ready yet, and 1 give it to some parties monthly — to 
 Mr. Johnson, in Bridge street. 
 
 Q. State upon what terms. 
 
 A. He was willing to pay me $400 monthly, because it is a very large district. 
 It runs from Fulton, North river, to pier 22, East river, all the way around. 
 Q. State whether this 8400 per month inures to your benefit alone? 
 A. Yes, sir. 
 
 Q. Is there any understanding by which any part of it is to be paid to any 
 body else ? 
 A. No, sir. 
 
 Q. Do you let any other part of the city ? 
 
NEW YORK CUSTOM-HOUSE. 157 * 
 
 A. No, sir — except there is another district above there. I told Mr. Johnson 
 to collect that, because my stores were not ready. 
 Q. Was he to give you anything for that ? 
 A. No, sir. 
 
 Q. How is it that the collector suffers you to have for nothing a business, the 
 part of which brings you from those who do the work $400 per month] 
 
 A. I suppose that $400 won't stand long — until my stores are ready. The 
 collector told me he was annoyed by overcharges, and wanted somebody to take 
 hold of that business who would satisfy the merchants. 
 
 Q. What proportion of the general order business has Mr. Johnson ? 
 
 A. He told me he did not make anymore than the money he had paid to me; 
 that it wouldn't pay the rent. 
 
 Q. At the rate Johnson has his section, what would the whole of it bring per 
 month, $2,000? 
 
 A. I don't think it would bring $1,000 per month without they would charge 
 double what they are charging now. 
 
 Q. Do you know whether the collector is aware of this arrangement you made 
 with Johnson 1 
 
 A. I do not know. 
 
 Q. Who gave you the information of your appointment ? 
 A. Mr. Stevens. 
 
 Q. In what way did he give it to you, by Mr. Smythe or verbally ? 
 A. Verbally. 
 
 Q. Who has charge of general order store in W T est street ? 
 A. We have. 
 
 Q. Will yoa state whether the charges at that store are less or more than 
 when Johnson did the business % 
 
 A. The charges in that district were exorbitant under Edwards, Atkins & Co. 
 They charged seventy-five cents for storage and seventy-five cents for labor. 
 We charge forty and forty. 
 
 Q. State whether this bill and advertisement [referring to bill in Stephen E. 
 Gorden's testimony and also advertisement] is yours. 
 
 A. Yes, sir. 
 
 Q. At whose instance did you make that advertisement ? 
 
 A. I told Mr. Stevens to do it. 
 
 Q. Did anybody suggest to you to do this ? 
 
 A. No, air; I intended to do it from the beginning. 
 
 Q. Will you look at that bill and state whether those charges are proper % 
 A. I could not tell exactly. We have had some very heavy bales at those 
 stores. 
 
 Q. Are those charges correct according to the manual 1 
 A. They are, for extra heavy bales. % 
 
 Q. Does not the manual, for the largest and smallest bales, prescribe the 
 rates, and can you exceed them on any pretext 1 
 
 A. Bales may sometimes differ altogether from those this speaks of. 
 
 Q. You spoke of a sale of this business at one time to Messrs. Miller & Con- 
 ger for 840,000. You have the same business for which they gave that sum 
 per annum ? 
 
 A. I have the business which I understand they gave that sum for. 
 
 Q. Do you wish the committee to understand that you have that business 
 exclusively for your own benefit, paying no consideration whatever to anybody 
 else ? 
 
 A. Only to benefit the importers of New York and satisfy the custom-house 
 with the prices. 
 
 Q. Do you say that there is no understanding of any kind between you and 
 any other person, other than this arrangement you speak of with Mr. Thom- 
 
• 158 
 
 NEW YORK CUSTOM-HOUSE. 
 
 eon, by which you arc expected to give any money or property of any kind to 
 anybody else in consequence of getting the general order business ? 
 A. No, sir. 
 
 Q There is no such arrangement ? 
 A. No, sir. 
 
 Q. Did you or your partner tell anybody or make the remark at any time 
 that Collector Smythe and you, or some of you, had got this business now so 
 fixed up that no investigating committee of Congress could make anything out 
 of it? 
 
 A. I never talked with anybody about such things ; I never heard my part- 
 ner make any of such import. 
 By Mr. Rollins : 
 Q. Was this business carried on by you or by your partner ? 
 A. By me exclusively. 
 
 Q. Did you have occasion to go to Mr. .Stevens's office frequently during these 
 negotiations ? 
 A. Yes, Bir. 
 
 Q. Who did you meet there? 
 
 A. Well, I saw different people there ; gome I knew and some I did not 
 know. 
 
 Q. Did you ever have any talk at Mr. Stevens's office with any other parties 
 besides Mr. Stevens about this business 
 A. No, sir. 
 
 Q. Did you ever meet George F. Thomson ? 
 A. Yes, some three or four times during this negotiation. 
 Q. Now inform the committee what conversation took place between you and 
 Mr. Thomson. 
 
 A. None about this business. 
 
 Q. Do you want the committee to understand you to swear that you did not 
 meet Mr. Thomson at Mr. Stevens's office before this contract was completed ? 
 A. Not before. 
 Q. When was it completed ? 
 
 A. It was completed on the third of December. I had not seen him before 
 that time anywhere. 
 Q. Did your partner 1 
 A. I believe not. I have not asked him. 
 
 Q. When did you make the arrangement with Mr. Thomson to become 
 clerk ? 
 
 A. At the time I had completed this business, the third of December. 
 Q. Are you sure you saw him on that day ? 
 
 A. I think that was the day on which I engaged him about this business. 
 Q. Had you ever seen him elsewhere prior to the completion of this business ? 
 A. I saw him last spring at my store. 
 Q. During the month of November ? 
 A. Not that I remember. 
 
 By Mr. Broomall : 
 
 Q. What was his business at your store last spring ? 
 
 A. Well, he was an old storage man, and stopped in once in a while to know 
 what was going on. 
 
 Q. Did he want you to undertake the general order business ? 
 A. No ; he wanted to know about hiring the stores. 
 Q. Did he tell you the general order business was to be given out? 
 A. No, sir. 
 
 
 
NEW YORK CUSTOM-HOUSE. 
 
 159 
 
 By Mr. Rollins: 
 
 Q. You say that Mr. Thomson is clerk for your firm at $2,500 per annum - 
 What does he do? 
 
 A. He goes around to the custom-house, to the ships, and one place and 
 another, doing the outside business. We have to be at our business in the 
 office. 
 
 Q. Is he still in your employ ? 
 A. Yes, sir. 
 
 Q. Discharge his duties every day ? Where is he to-day ? . 
 A. I have not seen him to-day. 
 Q. Where was he yesterday ? 
 A. I do not know. 
 
 Q. Engaged in the discharge of his duties yesterday? 
 
 A. I suppose he was. He is not obliged to come to the store every day if 
 he finds nothing to report. 
 
 Q. Does he have a desk at your office ? 
 
 A. He uses my desk. He comes there once, twice, or three times a week. 
 I told him he need not be there so often, because I want him more for the East 
 river side. • 
 
 Q. What does he do there now 1 ? 
 
 A. There is nothing there now for him to do. The regular time has not 
 started yet. I want him for the East river side. 
 Q. Has he done anything for you ? 
 
 A. Yes, sir; go to vessels, put in advertisements, &c ; but we have not much 
 for him to do until we get our stores ready on the East river side. 
 Q. Have you any other clerk that you employ in that way? 
 A. No, sir; they all have their steady work. 
 
 Q< Is there any other man in your employ of whose whereabouts at present 
 you do not know? 
 
 A. I know where they all are except Mr. Thomson, because his regular 
 station is not stated yet. • 
 
 By Mr. Broomall: 
 Q. I think you say you employed Thomson on the same day you completed 
 the contract. Did you need him then? 
 A. Not so much then. 
 
 Q. How came you to employ him before you needed him? 
 
 A. I thought I could hire stores all ready, but could not get them, and had to 
 wait for the new buildings. 
 
 Q. Did you have any negotiations with him before you had completed the 
 contract? 
 
 A. No, sir. Nothing was said about it before he came to me, the same day 
 after the contract was completed, to know if I would employ him. 
 
 Q. You say you had had no conversation with him about employing him 
 before the contract was completed ? 
 
 A. No, sir. 
 
 STEPHEN E. GARDNER, sworn and examined. 
 By Mr. Rollins : 
 
 Q. State your residence, business, and place of business. 
 
 A. My residence is 199 West Forty-third street. I am bookkeeper and 
 cashier at the bonded warehouse No. 363 West street. 
 
 Q. Do you know anything with reference to the rate of charges there for the 
 storage of general order goods ? If so, state what you know about it, whether 
 reasonable or otherwise. 
 
160 NEW YORK CUSTOM-HOUSE. 
 
 A. I have always endeavored to make them so, according to the rates fixed 
 in the manual. 
 
 Q. Are these charges in the manual, established in 1857 by the Chamber of 
 Commerce, the regular charges ? 
 
 A. Sixty per cent, is added to them. 
 
 Q. What was charged in December, 18G6, for storage of two bales of 
 linens ? 
 
 A. I know only of seeing the bill, of which the following is a copy, which, 
 with the advertisement annexed, I thought was a good joke, although then I 
 never expected they would be seen out of the store : 
 
 [ Advertisement. ] 
 
 GENERAL ORDER hoods. — The undersigned having from the first of December 
 charge of merchandise delivered under general order, and knowing that serious 
 complaints have heretofore been made in reference to overcharges for storage 
 &c, we desire to inform the merchants of this city that, in order to meet their 
 views and to prevent the renewal of complaints, we -lull, by the direction of the 
 collector of the port, reduce the charges on such goods to a satisfactory basis ; 
 and in case of any complaint, we invite the immediate prosental of the same to us. 
 
 MYERS &' SMITH, 
 
 Office 397 Greenwich Street. 
 
 [Hill.] 
 
 Dec. 17, '66. 
 
 H. & C. M. Hurlburt, to Myers & Smith : 
 Dec. 12. 1 y [H] y 464-468.— Two bales. 
 To storage, labor, and cartage, $6. 
 
 Received payment, 
 
 MYERS & SMITH, 
 
 p. C. S. S. 
 
 The way I # came to get this bill a cartman came there for some other goods, 
 and I had the curiosity to know what they charged up there, and he showed 
 me this bill. I should have made the bill $4, and then considered it as high as 
 law or custom would have allowed me to do. 
 
 Q. Have any other instances of overcharges come to your knowledge? 
 
 A. Yes. I have seen other bills under this new arrangement. I saw one 
 bill of theirs that was $6 75. Mine was $6. 
 
 By Mr. Broom all : 
 Q. How do the charges under the present arrangement with Messrs. Myers 
 & Smith compare with the charges under Johnson & Co.? 
 A. They are a great deal larger. 
 Q. What per cent. ? 
 A. Say from ten to fifty per cent. 
 
 By Mr. Rollins : 
 
 Q. Were there not complaints by the merchants of the charges of Johnson 
 & Co.? 
 
 A. In some instances there had been complaints made. Cartmen coming to 
 pay bills invariably said the charges at 363 West street were always within 
 bounds. Sometimes we got a bill a little higher than a merchant thought it 
 ought to be. 
 
 Q. In whose store are you employed ? 
 
 A. Edwards, Atkins & Co., 363 West street. 
 
 Q. Who has that section of the general order business now ? 
 
 A. Messrs. Myers & Smith. One thing I might say about that is, that they 
 are so far from the landing places of ships that it makes the cartage a good 
 deal heavier. They are half a mile further than Edwards, Atkins & # Co. 
 
NEW YORK CUSTOM-HOUSE. 
 
 161 
 
 A. L. BREWER sworn and examined. 
 By the Chairman : 
 
 Q. "What is your business and where is it? 
 
 A. I am cartman for the inland line of steamers. 
 
 Q. Do you know where the public stores are — the general order stores ? 
 A. Yes, sir. 
 
 Q. Do you know where they were ? 
 A. I do. 
 
 Q. I want you to state to the committee what the distance of the routes was, 
 and what you know of the security of the place ; where it is ; if accessible in 
 the night time ; and all about it. 
 
 A. The rate of cartage was sixty-six cents for the first half mile, for the general 
 order goods, and twenty-two cents for each additional half mile. When the 
 goods were taken to the old general order stores they were being taken nearer 
 to their destination. When they were taken to the other stores they were being 
 taken away from their destination, and it is two or three additional half miles. 
 The further down town the goods are the nearer they are to their destination. 
 
 By Mr. Broomall : 
 
 Q. I would ask you what is the price of cartage from the old general order 
 stores to the appraisers' stores ? 
 A. One dollar and ten cents. 
 
 Q. What is the price from the present general order stores to the appraisers' ? 
 
 A. There are four additional half miles, which would make it one dollar and 
 ninety-eight cents. City cartage is higher than that ; and when Mr. Draper 
 was appointed collector he reduced our cartage down to sixty-six cents, where 
 we were entitled-to seventy-five cents. 
 
 By the Chairman : 
 Q. What are the new stores 1 
 
 A. They are very strong built stores, but I do not know much of their con- 
 dition. I would not be willing to leave a load of goods there after dark, because 
 I think they would not be safe after being out of my possession. The store is 
 built very far back off the avenue. If the streets were built up where it is it 
 would be Thirteenth avenue. It is surrounded by lumber yards and timber 
 stores and is away from any other building. I would be afraid to have any of 
 my teams go there at night without an extra hand to watch it. 
 
 Q. Do you know whether such an occurrence has taken place there — goods 
 being lost? 
 
 A. I have not heard of any. I have only commenced to do the business. 
 Q. When would you be afraid to carry goods there ? 
 A. After dark. 
 
 Q. Are the surroundings bad ? 
 
 A. Very bad, sir. The committee ought to look at it themselves. 
 Q. What is the character of the surroundings 1 
 A. I cannot say. 
 
 New York, January 9, 1S67. 
 
 JOHN a. DALE sworn and examined. 
 
 By the Chairman : 
 Q. What is your business 1 
 
 A. I am agent for the Liverpool, New York and Philadelphia Steamship 
 Company. 
 
 H. Rep. Com. 30 11 
 
1G2 
 
 NEW YORK CUSTOM-HOUSE. 
 
 (). As such agent, docs not tli <* disposition of the goods brought on those 
 
 ships come before vou ? 
 A. Yes. 
 
 Q. How long have you been in this business ? 
 A. Fourteen years. 
 
 Q. Do not the goods that are unclaimed for twenty-four hours be sent to 
 general order stores ? 
 
 A. When goods for which no permits arc presented are landed they go to 
 general order stores. The ship has a right to demand a general order discharge 
 as soon as she enters at the custom-house; but it is customary to allow mer- 
 chants forty-eight hours to pass their entries. If we send goods before that 
 time to general orders, we pay the cost for forty-eight hours; after that time 
 the importers pay it themselves. 
 
 Q. Who transfers the goods from the steamships to the general order stores? 
 
 A. The carmen authorized by the collector. 
 
 Q. Then the company has nothing to do with the transfer of them ? 
 
 A. AYc deposit them on the dock, and the carmen then receive them, with 
 the ticket, and transfer them to the general order stores. 
 
 Q. To what stores are the goods sent now from your vessels? 
 
 A. I believe they are sent to stores in Bank street; it is a recent change, 
 and I have not been there. It is, as I have been told, a most inconvenient 
 place; very insecure, as far as transportation of goods after dark is concerned, 
 because it is in a district swarming with river thieves, and is surrounded with 
 great piles of lumber, which afford convenient hiding-places for these persons, 
 and is a place where, after dark, it is very easy to steal goods from. The con- 
 veniences for receiving and delivering goods are also very imperfect, and the 
 carman employed has protested against taking goods there at night. 
 
 Q. Where do your steamships dock ? 
 
 A. At pier 45, North river. 
 
 Q. What is the distance from that place to the Bank street stores ? 
 
 A. I don't know ; but I am told there is an increase in the cartage rates, and 
 of course the distance must be greater. 
 
 Q. Then it compares unfavorably with the stores formerly occupied as general 
 order stores 1 
 
 A. Decidedly so. 
 
 Q. Had you ever any trouble with the inspectors detailed to discharge your 
 
 vessels ? 
 A. No. 
 
 Q. Have you ever found it necessary, in order to secure their services, to 
 pay them extra ? 
 
 A. Y'es ; in order to make them work at night. 
 Q. What do you pay them then ? 
 
 A. It depends on the amount of labor they do. The regulation price is 
 $12 50 a night per man. If they work two nights there, and never go away, 
 they probably get a few dollars more. The last regulation I made was S12 50 
 per man per night. It is entirely optional with them whether they work at 
 night or not. 
 
 Q. In addition to this, does not each steamer pay each officer an extra 
 amount, whether he works at night or not ? 
 
 A. I believe they do have compensation for board, and not going away. 
 
 Q. What does that amount to ? 
 
 A. To $15 a vessel, no matter what time she is in. 
 
 Q. Previous to the goods going to the foot of Bank street, did they not go to 
 the stores of Squires & Co. I ' 
 
 A. Not immediately previous. Some time ago I went to Washington and saw 
 the Secretary of the Treasury about getting these stores bonded, after seeing 
 
NEW YORK CUSTOM-HOUSE. 
 
 163 
 
 Mr. Draper, who was collector at the time. The Secretary refused to bond the 
 stores; but, after considerable trouble and delay, they were bonded, and made 
 general order stores for goods coming from our steamers. The rates were then 
 lower than ever we paid before, being, on an average, $1 15 per package. This 
 store, from its central position, was very convenient both to the merchants and 
 to us ; as our docks were within a stone-throw of it, it gave us great facilities 
 in receiving and delivering goods, and gave satisfaction to everybody. To my 
 surprise, some time after, the stores of Edward Atkins & Co., in Leroy street, 
 were taken. The rates were higher there — I think $1 50 a package, and I 
 made a protest against paying them. The storekeeper told me they were the 
 same rates charged by Mr. Squires. I then made inquiries, and learned that 
 when Mr. Squires found he was going to lose the general order business, he had, 
 for a short time, advanced his charges to the rates that Squires was then charg- 
 ing. The rates at the present store are from $L 50 to $2 a package ; and $2 
 is charged for what we know more than $1 50 ought not. If you complain to 
 the storekeeper he will tell you it is a large or a heavy package, although we 
 know well it is not. By a special arrangement made with the storekeeper by 
 some large houses, packages are taken at a dollar. We find goods coming to us 
 for some of these houses are charged $1 25, while smaller houses pay $2 for 
 the same size packages, which is an enormous charge. And, also, the goods 
 are brought a great distance from the importers' stores, and they have to pay 
 the increased rate of cartage to bring them back there. 
 Q. Who owns these new stores'? 
 
 A. Myers & Smith lease them; but I am told the owner is a Mr. Moller. 
 
 Q. In your opinion, what is the difference in what you pay on every ship- 
 load between the former rates and the present rates ? 
 
 A. I could tell- you if I was in the office, because we had a vessel that dis- 
 charged all her cargo under general orders. I know the difference is very great, 
 but how much larger it is at present than at Squires's rate I cannot say. 
 
 Q. You pay the rates for the first forty-eight hours, and after that time the, 
 merchants pav it; is that so? 
 
 A. Yes. 
 
 Q. Is the excess of this charge for the cartage? 
 A. The rates together included cartage and storage 
 
 Q. But, do the present holders of the business charge more for storage than 
 Squires & Co. ? 
 A. They do. 
 
 Q. How many tons of merchandise does one of your vessels discharge at each 
 trip? 
 
 A. Probably one thousand tons. 
 
 Q. Are not these cargoes made up of an almost infinitesimal number of pack- 
 ages ? 
 A. Yes. 
 
 Q. What are the lowest rates they charge for storage on packages ? 
 
 A. The minimum rate, I believe, is a dollar; and that is where they have 
 made some previous arrangement with the merchants to take their goods under 
 general order rates. 
 
 Q. There are no parcels taken less than that? 
 
 A. No ; and whether a parcel remains there six hours or not it has to pay 
 that. The majority of the goods do not remain there very long. 
 
 Q. What steamer was it that came in that you sent the entire cargo to the 
 general order stores in Bank street? 
 
 A. The vessel 1 alluded to, the City of New York. 
 
 Q. Why and when was the cargo sent there? 
 
 A. The City of New York arrived here about three weeks ago and had to be 
 discharged at night ; and under custom regulations it had to be sent immediately 
 
164 
 
 NEW YORK CUSTOM-HOUSE. 
 
 to general order stores. The carmen, who were authorized by the collector to 
 cart these goods, protested against taking the goods to these stores at Hank street 
 after night fall, and would not be responsible for them, as it was such an unfre- 
 quented place, and was surrounded, as I before stated, by lumber piles which 
 afforded places for thieves to conceal themselves behind. We went to Mr. 
 Ly decker, chief clerk in the custom-house, and represented the matter to him, 
 and he changed the general order to another store down town owned by the 
 same parties. It was a great deal nearer to our dock than the new one, and 
 they stored the goods there until the store was full, and the balance of the cargo 
 they sent up to the Hank street store. In consequence of this we had numer- 
 ous complaints from the importers, who did not know into which store their 
 goods had been put, or whether they had been covered by insurance or not; 
 while all this time there a store within a stone-throw ready to receive them. 
 
 Q. Was Squires's as perfectly secure as the other? 
 
 A. Yes ; and they are still bonded stores. 
 
 Q. Is this condition of things, as you stated above, going on at the present 
 time ? 
 
 A. Y'S. 
 
 Q. What is the rtitli-rence in the distance between Squires's store and the Bank 
 street store from your dock ? 
 
 A. The distance from Squires's store to our dock is about a block and a half; 
 the other store is a mile and a half from it. 
 
 NBW York, January 10, 1867. 
 CHARLES W. VAX SAUX sworn and examined. 
 Hy the Chairman : 
 
 Q. Are you in business in this city ? 
 A. I am a clerk. 
 
 Q. Are you acquainted with the firm of Myers be Smith, personally or by 
 reputation I 
 
 A. I am acquainted with them. 
 
 Q. How long has that firm been in existence ? 
 
 A. About a year and a half. 
 
 Q. Did you know any of the partners before they went into the present busi- 
 ness arrangement 1 
 
 A. I knew Mr. Smith ? 
 
 Q. What was his previous occupation ? 
 
 A. He was an inspector in the custom-house. 
 
 Q. Do you know when his connection with the custom-house ceased 1 
 A. I think about two years ago. 
 
 Q. Did he then go into his present business arrangement ? 
 
 A. He went into his present arrangement about a year and a half ago. 
 
 Q. Do you know Myers, and what his occupation was before he engaged in 
 the present business ? 
 
 A. I do not know him personally ; but I heard he kept a liquor store in the 
 first ward from several persons who were acquainted with him. 
 
 Q. How long was he engaged in that business ? 
 
 A. I do not kuow. 
 
 Q. Do you know whether he went from that to the present business ? 
 A. He went from that to the free storage business, and from that to the bonded 
 business. 
 
 Q. How long was he in the free storage business ? 
 A. About a year and a half. 
 
NEW YOKK CUSTOM-HOUSE. 
 
 165 
 
 Q. And lias lie been long in the bonded business 1 
 A. About a year and a half. 
 
 Q. What is the general reputation of Myers & Smith as bonded warehouse- 
 men ? 
 
 A. Their conduct of the business is a matter of complaint continually from 
 the clerks and the carmen who are engaged in this business. They complain 
 of the delay in making out bills, and in turning the goods out of their stores. 
 They appear not to know how to take care of the goods so as to turn them out 
 quickly. 
 
 Q. Had J^iey any other experience, other than that you spoke of, of the 
 method of transacting this kind of business 1 
 A. None whatever. 
 
 Q. Did they ever apply to you for information of any kind ? 
 A. Their clerk applied to me for information as to how I kept the books, as 
 they did not understand how they were kept. 
 
 New York, January 9, 1867. 
 FRANCIS WOODRUFF sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you engaged in business 1 
 
 A. I am, both in this city and in Brooklyn. » 
 
 Q. Have you ever had any of this general order business ? 
 
 A. I had in Brooklyn. 
 
 Q. Have you it now ? 
 
 A. No. 
 
 Q. When did your connection with it cease ? 
 
 A. It was taken away from us by Mr. Smythe last October. We could not 
 find out what the reason was. We went to ask Mr. Smythe why it was taken 
 from us. He said he thought of making a change, and that we did not support 
 the administration. We ceased from that time to get any of it. 
 
 Q. Who has it now 1 
 
 A. I think Roberts & Co. 
 
 Q. Do they support the administration? 
 
 A. I do not know what the term " administration," as used by him, means. 
 I suppose it is the President. 
 
 Q. Do you know Mr. Thomas B. Asten, superintendent of warehouses 1 
 A. Yes. 
 
 Q. Did you ever pay him any money for the general order business ? 
 A. No. 
 
 Q. Were you ever called on by him to pay any ? 
 
 A. No ; I think not. We gave some money for political purposes in New 
 York. 
 
 Q. Who did you give that money to 1 
 
 A. Some gentleman who called upon us. I do not recollect his name. 
 Q. Were you ever called upon to pay any money, at Mr. Smythe's suggestion 
 or request, to Asten ? 
 A. I think not. 
 
 Q. For his benefit, or to him in any way ? 
 A. No. 
 
 Q. You say you never paid anything to Asten or Smythe ; did you to Thom- 
 son ? 
 
 A. I do not know him. 
 
1GG 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Iliive you ever paid to any person any money on account of the general 
 order business ? 
 
 A. No; except a small contribution for political purposes. 
 
 (,). Through whom did you receive this general order business? 
 
 A. Mr. Draper. 
 
 Q. Do you know the terms on which the present holders of the business ob- 
 tained it? 
 A. I do not. 
 
 Q. Have you heard the terms, or that they paid any amount for it? 
 A. No. - 
 Q. Had you any conversation with them about it ? 
 A. No. 
 
 Q. Have you any reason to believe or to suppose that Roberts & Co. pay 
 anything for it ? 
 
 A. I should infer that they must. I should think it likely, but I have DO 
 special reason for believing so. Mr. Smythe said whoever had these favors 
 should contribute something lor political purposes if called upon. We said if 
 that was so, we would be as liberal as any one else. He said he would not 
 make the change without seeing us ; but he did not do so. 
 
 Q. You were* not called upon to pay him, or any person for him ? 
 
 A. No. We called upon him, and had a talk with him. He said these 
 things should contribute for political purposes, and that those that hud those 
 favors should be called upon. But he never called upon us. 
 
 Q. You do not know the reason for taking the business from you, except 
 what he told you ? 
 
 A. No ; except that he told us we did not support the administration. 
 
 Q. Had you any conversation with Mr. Smythe or 'with Mr. Asten since in 
 reference to it I 
 
 A. No. 
 
 New York, December 20, 1S66. 
 
 CALVIN ANGER sworn and examined. 
 
 By the Chairman : 
 
 Q. How long have you been storekeeper ? 
 A. About four years. 
 
 Q. Have you been removed during that period ? 
 
 A. I was removed on the 9th of October. 
 
 Q. What was you removed for ? 
 
 A. For political purposes — so the collector told me. 
 
 Q. Where you reinstated ? 
 
 A. I was. 
 
 Q. How long after your removal % 
 
 A. I was sw r orn into office sixteen days after my removal. 
 Q. What influences induced a reinstatement ? 
 A. All of his bondsmen and other friends. 
 Q. Did you have Senator Morgan's name ? 
 A. I did. 
 
 Q. What was said about the use of his name when you made use of it once ? 
 
 A. It was said it would avail me nothing. 
 
 Q. Were you told what would avail you ? 
 
 A. Y r es, sir. 
 
 Q. By whom ? 
 
 A. By Mr. Asten. 
 
NEW YORK CUSTOM-HOUSE. 
 
 167 
 
 Q. Who is Mr. Asten? 
 
 A. He is superintendent of the warehouses in connection with the custom- 
 house. 
 
 Q. Does he have the supervision of the storehouses ? 
 A. He assigns the storekeepers their places. 
 
 Q. What influences did he say would avail you, or what course did he suggest 
 you to undertake to procure your reappointment ? 
 
 A. He did say that he could do more for me than anybody else, knowing the 
 circumstances of my misfortune. I told him he was a stranger to me ; that I had 
 my friends, and did not need his assistance. I believe I did tell him that Mr. 
 Morgan was a friend of mine, and it is that, with my papers at the custom-house, 
 I relied upon. 
 
 Q. Was it then he made the remark that Senator Morgan's name would not 
 avail you anything ? 
 
 A. Yes, sir. I then called on the collector and wanted to know what the 
 difhculty was ; and he told me plainly what he wanted my place for. He said 
 he wanted it for political purposes. That was the reply he made to me. 
 
 Q. How did you eventually succeed in obtaining your appointment ? 
 
 A. I, in the first place, called upon a personal friend of mine, Mr. Thorne, 
 president of the Equitable Insurance Company. Says he, " I am on your paper, 
 Mr. Anger, and am your friend now. I shall go and get a gentleman who is in 
 confidence with the collector." That was Mr. Embree, deputy collector. Says 
 I, " Mr. Thorne, I want to know why I am removed ?" Says he, " I think I 
 will find out;" and that very day he called on Mr. Embree and told him this 
 circumstance ; that he was very sorry for my removal, and that there could be 
 no cause for it. Mr. Embree told him that was the doings of Mr. Asten, and 
 why it was, and left the subject. 
 
 Q. Were you induced to use any money about this matter ? 
 
 A. No, sir, I was not; and I directly refused to use money. It was proposed 
 that I should. 
 
 Q. Was any money used 1 
 
 A. Yes, sir ; used in one sense. I can explain that. Mr. Livingston, the 
 principal of this bonded warehouse, says : " 1 am very sorry to lose you, Mr. 
 Anger, and I have offered $200 to have you replaced and come back to my 
 store." Says I, "Not a cent of that will come out of me ; I have my friends, 
 and want no assistance from Mr. Asten whatever." He was continually trying 
 to get mon^y out of me. I told him, months previously, when Mr. King was 
 appointed collector — says I, " If you bring Mr. King's receipt to me for the $25 
 that you want of me, I will give you the $25 that you now wish ; but I shall 
 pay you no money. He was always prejudiced against me. But it seems that, 
 at about the 20th of October, Mr. Smythe sent for me, and said, " There is a 
 press on me from all my friends." I met Mr. Lawrence, one of the bondsmen 
 of Mr. Smythe, who told me he had just left the collector, and that I would be 
 reinstated, and that the collector wanted to see me. I went into the custom- 
 house and saw Mr. Smythe. He said he had received a letter from Newport 
 from my friends to immediately reinstate me to office; that he was bound to do 
 it, and that as soon as my name could be returned from Washington I should 
 be sworn it. It was returned on the 26th of October, and I was sworn in on 
 that day, and went to my place. Mr. Livingston had previously made this two 
 hundred dollar offer to Mr. Phillips, Mr. Asten's clerk. Phillips was con- 
 stantly down on me for $200. Mr. Asten told me to appear there from day to 
 day and he would assign me a place. Finally, Mr. Asten told him he would 
 compromise with him for one hundred dollars. He paid Mr. Asten, so he told 
 me himself, one hundred dollars to have me placed back in his store. Says I, 
 " You have taken that responsibility yourself ; I shall assume nothing of it, and 
 shall not pay a cent of it ; I don't care what store I go to, and shall ask no 
 
168 
 
 NEW YORK CUSTOM-nOUSE. 
 
 favors of that office." lie stated he had done this to have me replaced at hi* 
 
 bonded warehouse. 
 
 By Mr. Rollins : 
 
 Q. Did Ms, Phillips or Mr. Asten ever say anything to you ahout the money I 
 A. Not a word ; neither of them, nor Mr. Smyth.-. 
 
 V. 13. LIVINGSTON, jr., sworn and examined. 
 
 By the Chairman i 
 Q. Are you connected with the custom-house? 
 
 A. Well, indirectly I may say. I am proprietor of the bonded warehouse. 
 Q. Is Mr. Anger in your warehouse ? 
 A. Yes, sir. 
 
 Q. He was removed and reinstated again. , Do you know anything of the 
 appliance and influences used in reinstating him ? 
 A. Nothing more than what lie has told me. 
 Q. Don't you know of $100 being paid for his being reinstated ? 
 A. No, sir. 
 
 Q. Do you know of no money being paid for his reinstatement ? 
 A. No, sir. 
 
 Q. Do you know of any friends of his advancing any amount for his benefit ? 
 A. No, sir. 
 
 Q. For the benefit then of the person who has charge in the custom-house of 
 the storekeeper's business ? 
 
 A. There was some money paid to tin; superintendent of the warehouse — 
 paid by myself, but that was not to have Mr. Auger reinstated. 
 
 By Mr. Broom all : 
 
 Q. What led to the payment of that money ? 
 
 A. I don't know exactly what led to it, but Mr. Asten has everything to do 
 with the warehouses, and from time to time has been very kind to me, and when 
 Mr. Anger was reinstated he sent him back again to my store. I made Mr. 
 Asten a present of a hundred dollars, never having mentioned it before. I gave 
 him a hundred dollars towards his club with which he was connected and of 
 which he was president. 
 
 By the Chairman : 
 
 Q. Has he ever called on you for the other hundred ? 
 A. No, sir. 
 
 Q. Any one in his behalf? 
 
 A. A sort of deputy came down once and asked me. The whole matter orig- 
 inally came from this : When Mr. Anger was removed I felt very sorry for him, 
 he being a very gentlemanly man and with limited means. I happened to be 
 one day with the assistant superintendent of warehouses and incidentally men- 
 tioned my interest in Mr. Anger's case, and said, " Why, I would give $200 to 
 have him reinstated." Nothing more was said. When he was reinstated this 
 deputy informed me that Mr. Asten had had him reinstated. I knew that was not 
 the case. He then reminded me of my promise. I did not exactly like to do it, 
 but did not wish them to think I had gone back on them. He spoke to me sev- 
 eral times about it ; I positively refused to give anything, and told him if Mr. 
 Asten could show in any way how he was instrumental in Mr. Anger's rein- 
 statement I would fulfil my promise, but did not think I was bound to unless 
 he could. I was very well satisfied how he became reinstated and that Asten 
 had nothing to do with it. I told him that I would see Mr. Asten, and if I did 
 give him anything I did not wish him to understand it was done for reinstating 
 Anger, but rather for his kindness and civility to me in little ways, such as 
 
NEW YORK CUSTOM-HOUSE. 
 
 169 
 
 keeping store open a little later, &c, or anything of that kind. I told him I 
 was very glad that Anger had come back, and that I would give him something 
 for his political organization, and that was the end of it. If I had given it for 
 the purpose of having Mr. Anger reinstated I should have given him $200. 
 
 Q. Have you asked Mr. Anger to replace that one hundred dollars 1 
 
 A. no, sir ; not in any shape. 
 
 By Mr. Broomall : 
 
 Q. Did you not tell Mr. Anger of this 1 
 
 A. O, yes ; I related to him the whole circumstance. 
 
 Q. Was he willing the money should be repaid for his being reinstated 1 
 
 A. He objected to it. In the first place he did not believe there was any 
 chance for Mr. Asten's favoring him in any way. He had some feeling against 
 him because he thought he was instrumental in having him removed. No, An- 
 ger rather objected to my giving it, because, I think, he had rather had it him- 
 self. He thought it was money wasted to no purpose. He rather tried to dis- 
 suade me from it. 
 
 Q. What led you to suppose the two hundred dollars would be the means of 
 reinstating him ? 
 
 A. I never had any supposition of this thing. I merely happened to state it 
 in an off-hand way without thinking. 
 
 Q. You say Mr. Asten refused to receive the money at first. Did he refuse 
 to receive the money or the particular way in which you were going to give it 
 to him ? 
 
 A. I never offered it in any other way to him. He said, " 0, no ; I could 
 not take it from you," or something of that kind. Nothing has been said by 
 Mr. Asten or Mr. Phillips, or anybody else. 
 
 By Mr. Rollins : 
 
 Q. Was nothing said about Mr. Anger being sent to your store ? 
 
 A. Yes ; I told him I was glad he was reinstated and sent back to my store. 
 
 Q. He had been sent to your store before you gave the $1001 
 
 A. I had been out of town, and when I came back, to my surprise, I found 
 Mr. Anger back to my store at his old place. Perhaps a week after that I saw 
 Mr. Asten. 
 
 THURLOW WEED sworn and examined. 
 
 By the Chairman: 
 
 Q. Are you acquainted with Henry A. Smythe, the collector of the port of 
 New York? 
 A. Yes, sir. 
 
 Q. Did he ever inform you or state in your hearing that he had sold or ex- 
 pected to sell the business of the general order storage, or words to that effect ? 
 
 A. Not long after Mr. Smythe was appointed collector, Mr. Humphrey, late 
 member of Congress, called to see me on that subject, and told me he had had 
 that business under former collectors and that he had now been removed ; and 
 that as he was committed for store rents and things of that kind it was a seri- 
 ous injury to him. He asked me to speak with the collector on the subject. I 
 did so, and the collector said it was too late to talk about it ; some arrangement 
 had been made and precluded the matter of Mr. Humphrey's. Subsequently 
 Mr. Humphrey saw me again, having himself seen Mr. Smythe, and at his re- 
 quest I spoke again to the collector, who said that perhaps some arrangement 
 could be made with the other parties; they might rent his stores or in some way 
 arrange the interest to the satisfaction of Mr. Humphrey. 
 
 Q. Did Mr. Smythe say he had disposed of it 1 
 
170 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. lie said other arrangements had been made. He did not say anything 
 about the consideration or amount. 
 
 Q. Did you get any information, either directly or indirectly, of Mr. Smythe 
 as to the amount paid ? 
 
 A. I did not. 
 
 Q. Or from any other quarter ? 
 
 A. I do not know what would be considered information. I have rumors 
 with reference to the sale of the business to Messrs. Miller & Conger, but Mr. 
 Smythe did not inform me anything about that. It is proper for me to say here 
 that on a subsequent occasion Mr. Humphrey told in*' the lirst or original ar- 
 rangement had been broken up and that new parties had got the business. He 
 said nothing about the arrangement with the new parties, and I know nothing 
 of it. 
 
 Q. Do you know anything with reference* to the selling of the cartage 
 business ? 
 
 A. Nothing, except that a person by the name of Lindsey, who had some in- 
 terest in it, died; and I was anxious that his family should be benefited in a 
 certain way, and I think I went to see the collector on that subject. 
 
 NBW York, January 11, 18G7. 
 
 J. F. BUG-BEE recalled and examined. 
 
 By the Chairman : 
 Q. You have been storekeeper here ? 
 A. Yes. 
 
 Q. Has there been any change affecting the transfer from the general order 
 store to the warehouses lately ? 
 A. Yes. 
 
 Q. When was that change made ? 
 
 A. It was made in accordance with the following letter: 
 
 Collector's Office, Custom-House, 
 
 New York, October 17, 1866. 
 Sir: In conformity with your suggestion, you are hereby directed to see that 
 all goods taken from one bonded store to another are transferred by the regu- 
 larly appointed custom-house carmen. 
 
 H. A. SMYTHE, Collector. 
 
 F. B. Astex, Warehouse Superintendent. 
 
 Q. Who designates these carmen ? 
 A. The collector. 
 
 Q. What was the operation previous to the issuing of this order ? 
 
 A. Each merchant's goods were transferred by his own private carmen. 
 
 Q. What was the security given to the government for the safety of the goods 
 carried by these private carmen 1 
 
 A. Bonds were given by the carmen, and usually indorsed by the merchants. 
 
 Q. Under that system was there any danger that the interests of the govern- 
 ment would be injured 1 
 
 A. I do not think there was. 
 
 Q. Why was that change instituted, then ? 
 
 A. I know no reason for it, except to place the profits of the transfer cartage 
 in the hands of the custom-house carmen. 
 
 Q. Does this arrangement give satisfaction to the merchants ? 
 A. I understand it does not. 
 
NEW YORK CUSTOM-HOUSE. 
 
 171 
 
 Q. Do you know whether these private carmen work by the day or load ? 
 A. They generally work by the case. 
 
 Q. Do you know the rates, and whether there is any variation in the rates 
 charged by the custom house carmen and those charged by the private carmen 1 ? 
 A. There is. 
 
 Q. What is the difference? 
 
 A. I understand A. T. Stewart's carmen, for instance, had forty cents a case, 
 and these custom-house carmen get sixty-six cents a load ; which, in the way 
 they usually manage it, is a case. For instance, if they have half a dozen cases 
 for half a dozen different houses, they will have a load for each case. 
 
 Q. That is now the system % 
 
 A. Yes. 
 
 Q. Is it usual for the merchants to transfer a very considerable portion of 
 their merchandise from general order stores to these private bonded ware- 
 houses 1 
 
 A. It is the custom to do so. 
 
 Q. Why is it the custom to do so ? 
 
 A. I suppose the main reason is the want of accommodation at the general 
 order stores. 
 
 Q. Is there any obligation on merchants to take their goods out of general 
 orders within a certain fixed period of time ? 
 A. I don't know there is any obligation. 
 Q. What do you mean by private bouded warehouses % 
 
 A. A private bonded warehouse is one which does not take general order 
 goods, except in cases of emergency. It is a bonded warehouse where they 
 take goods on special contract with the importers. 
 
 Q. What do you mean by bonded? 
 
 A. The proprietors of these stores, which receive goods on which the duty i3 
 not paid, give bonds that these goods shall not be removed until these duties 
 are paid. 
 
 Q. Then why do not Mr. A. T. Stewart and other merchants, instead of hav- 
 ing their goods sent to general orders, have them sent at first to private bonded 
 warehouses, without subjecting them to general order storage, cartage, &c? 
 
 A. I suppose there are various reasons. One is, emergency. Sometimes an 
 importing vessel is obliged to discharge rapidly — so rapidly that the owners of 
 the vessels prefer to pay general order storage and cartage rather than have their 
 vessel delayed, and they work day and night to get the goods out. Another 
 reason is that a standing regulation of the department requires the inspectors 
 who are discharging vessels to send the goods which are unclaimed for a cer- 
 tain specified time to general order stores. And another reason is, that through 
 collusion between the keepers of general order stores and the inspectors who 
 discharge the vessels, goods are often sent under general orders when they ought 
 not to be. 
 
 JOHN F. BUGBEE sworn and examined. 
 
 By the Chairman : 
 Q. Were you formerly connected with the custom-house ? 
 A. Yes, in the capacity of storekeeper at the bonded warehouse 71 Greenwich 
 street. 
 
 Q. When did your connection cease ? 
 
 A. On the 27th October last. 
 
 Q. Do you know the person who succeeded you ] 
 
 A. I do. 
 
 Q. State what is his name. 
 
 A, His name is Mr. Schewalder. 
 
172 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. What place or .State is lie from ? 
 A. He is from the State of Tennessee. 
 Q. What is his age ? 
 
 A. He ^ays that he is in his twentieth year. 
 
 Q. What is his competency to discharge the duties of his office ? 
 
 A. I consider him incompetent. 
 
 Q. Is that one of the large storehouses ? 
 
 A. Yes, sir; it is one of the largest in the city. 
 
 Ni:\v FORK, January 9, 18G7. 
 
 HIRAM BARNEY sworn and examined. 
 
 By the CHAIRMAN : 
 Q. Were you collector of the port of New York ? 
 A. I was. 
 
 Q. In what year or years did you hold that position? 
 A. In 18G1, 1862, 1863, and 1864. 
 
 Q. As such collector, did you ever sell what is known as the general order 
 business ? 
 
 A. I never did. 
 
 Q. Or any other patronage of the government, or attempt any such sale ? 
 A. I never did. 
 
 Q. In selecting warehouses for the storage of the general order goods, were 
 you governed by a desire of selecting stores located convenient to the shipping 
 and merchants, and controlled by experienced and reliable business men? 
 
 A. Yes, I was governed by this desire, and also the wish to select safe and 
 commodious warehouses. 
 
 Q. "Was there ever any arrangement, directly or indirectly, by which you as 
 collector should privately receive any advantage, pecuniarily or otherwise, for 
 this general order business ? 
 
 A. None, whatever. I have not been cognizant of any such arrangement, nor 
 have I authorized it, directly or indirectly. 
 
 New York, January 10, 1S67. 
 
 AUGUSTUS SCHELL sworn and examined. 
 
 By the Chairman : 
 
 Q. You were collector of the port of New York ? 
 A. Yes. 
 
 Q. How long have you been collector ? 
 
 A. I was collector from the 1st of July, 1S57, to the 8th of April, 1861. 
 Q. What was termed the general order business was then in existence ? 
 A. Yes. 
 
 Q. Did you ever sell the general order business or any patronage of the gov- 
 ernment, or attempt any such sale ? 
 
 A. I never received any money or any other consideration, directly or indi- 
 rectly, for any patronage given by me as collector to any person or persons 
 during my term of office ; neither have I attempted to make any such sale. 
 
 Q. In selecting warehouses for the storage of general order goods what gov- 
 erned your selection ? 
 
 A. When stores were proposed to me to be designated as general order stores 
 I transmitted the application to the department at Washington, and if the stores 
 were approved of, the necessary papers were executed. 
 
NEW YORK CUSTOM-HOUSE. 
 
 173 
 
 Q. What governed you then in recommending the stores ? 
 A. The character of the applicants, the location of the stores, their conveni- 
 ence to the merchants, and their capacity. 
 
 Q. The safety of the goods and the accommodation of the merchants ? 
 A. Yes. 
 
 Q. These selections of bonded warehouses for general order goods were never 
 controlled or influenced by any money or other valuable consideration given 
 you or to any one connected with the custom-honse ? 
 
 A. No. 
 
 January 15, 1867. 
 
 Answer of Hon. HEMAN J. REDFIELB to interrogations propounded to 
 him by Mr. Hulburd, chairman : 
 
 Q. In what year or years were you collector of the port of New York ? 
 
 A. From 1st November, 1853, to 1st July, 1857; in all, three years and 
 seven months. 
 
 Q. As such collector did you ever sell what is known as the general order 
 business, or any other patronage of the government, or attempt such sale ? 
 A. No, never. 
 
 Q. In selecting warehouses for the storage of general order goods, were you 
 governed by a desire to select stores located convenient to the shipping and 
 merchants and controlled by experienced and reliable business men % 
 
 A. Such was continually my effort. 
 
 Q. Was there ever any arrangement, directly or indirectly, by which you as 
 collector should -privately receive an advantage, pecuniarily or otherwise, for 
 this general order business ? 
 
 A. Never was any such arrangement made or thought of. The change from 
 public to private stores was effected mainly during my term of office. My prin- 
 cipal deputy, the late M. F. Odell, and late member of Congress and naval offi- 
 cer, resigned his place as deputy for the purpose of keeping a model, bonded 
 warehouse and superintending the storage of goods generally, including such as 
 were sent under general order. I labored to perfect the whole system as a 
 great reform over the old order of things. The disposition of general order 
 goods occasioned the most difficulty. But the convenience of merchants and 
 consignees was always consulted, and in no instance did I ever derive any in- 
 terest or advantage personally in the disposition of such goods, nor have I reason 
 to believe that any deputy or other officer of the customs, under me, was 
 interested or received any advantage, pecuniary or otherwise, in the disposition 
 of the same. 
 
 New York, January 9, 1867. 
 ABRAM WAKEMAN sworn and examined. 
 
 Q. What is your position 1 
 
 A. I am surveyor of the port of New York. 
 
 Q. How long have you been surveyor ? 
 
 A. I think it was in September, 1864, I was appointed. 
 
 Q. Have you ever had any conversation with the present collector, Mr. Smythe, 
 as to the general order business 1 
 A. I think not. 
 
 Q. Has he ever said to you, at any time, that he had disposed of it, or sold it; 
 and if so, to whom ? 
 
174 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. I think I never had any conversation with the collector upon the subject 
 of the general order business. 
 
 Q. Did you ever hear Mr. Smytho say he had sold the general order business, 
 or the Cartage business, or words of like import ? 
 
 A. I had a conversation with Mr. Smytho, some time, I think, last summer, and 
 this cartage business came up. I will state that conversation as near as I can, 
 not undertaking to give the exact language of either himself or myself. I calh-d 
 at his office and had a conversation with him on som" official matters, after which, 
 as near as I can remember now, he said, " I am about selling out this transfer 
 cartage business; what do you think of it?" I hesitated before I made any 
 reply, and then said, do you say "selling" it, Mr. Collector? He replied, "Ye-."' 
 I remarked, or made the inquiry, M Is there any law that authorizes a sale of 
 this interest?" lie replied that he understood that was the usage and practice. 
 I replied, 1 knew of no such law, and, continuing, saM, " L*-t mo confidentially 
 say to you, Mr. Collector, that 1 think the disposition of any such interest as 
 that, if not in direct contravention to law, seems to me to be imprudent and un- 
 wise." He then asked me, M How are we to pay these political requisitions that 
 are made upon us from time to time '(" I said I knew no other way except to 
 pay them out of our own pockets. He then said he understood that had been 
 the source from which such fund - had been received. I replied that it was not so, 
 to my knowledge. I then remarked to him in general terms, " Mr. Collector, 
 let me say to you in confidence, and as a friend, that such a sale, in my judg- 
 ment, would be unwise; and allow me to say to yon, if you receive one dollar 
 from that source, or allow it to be received, I am afraid it will end in trouble." 
 I remember 1 used these words, " It will bring around your head a hornet V nest." 
 I also pressed upon him its inexpediency, on the ground that it would practically 
 place that branch of the service out of his control. I said it needed reform ; but 
 that that was not the way to reform it. I then alluded to the general order 
 business, and said that much good could be done there, and that it properly in- 
 vestigated, I thought thirty per cent, could be saved on the rates of storage; 
 that when the late Mr. King was collector, I had examined the subject, and 
 found the rates could be largely reduced. I remarked that the overhauling of 
 this department, and the lowering of these rates, would be one of the most pop- 
 ular measures which he could inaugurate. He said that he would look into the 
 whole matter; and that, I think, terminated the conversation. I have no re- 
 collection of having spoken to him upon this subject from that time to this. 
 
 Q. Had you ever a conversation with Mr. Embree on the subject ? 
 
 A. Never. 
 
 Q. Or with Mr. Brown, the collector's private secretary ? 
 A. Not to my recollection. 
 
 Q. Did Mr. Smythe, in the course of this conversation, try to put it on the 
 ground that he was acting as trustee for a sort of fund — a political trustee, so to 
 speak — and as such that he had a right to do so ? 
 
 A. I think that idea was introduced in the course of conversation ; but I 
 cannot now recollect the language used. Now it occurs to me that he said a 
 fund could be thus raised for political purposes, and that he could receive it and 
 pay it out so long as none of it remained in his hands. I said no matter how 
 innocent it might appear to him, yet it was a proceeding I should recommend 
 him not to adopt. 
 
 Q. You don't know the course he did take? 
 
 A. No ; he never spoke to me on the subject from that time to this, to my 
 knowledge. 
 
 Q. Has it come to your knowledge that the collector has given orders re- 
 questing that the inspectors of customs should pass the baggage of passengers 
 from foreign ports without the examination required by law ? and if so, state 
 what you know of the matter. 
 
NEW TORE CUSTOM-HOUSE. 
 
 175 
 
 A. Collectors are very often solicited by their friends to facilitate the land- 
 ing of passengers' baggage ; and it has been a common practice for persons 
 acquainted with the collector to request these orders to be given to the inspectors 
 or my deputy. Shortly after Mr. Smythe came into office, one or two notes 
 were sent to me. One of them was a direction to pass some persons' baggage. 
 I instantly went to the collector, and said to him that the form of the note was 
 such that it would contravene the regulations of the department as well as the 
 law ; and I said, I suppose you did not intend making an order in opposition 
 to the regulations ? He said certainly not ; he only wanted me to extend such 
 facilities as the law allowed. I remarked it would be well to put it in some 
 such form as this, to extend such facilities to the passengers as the law and the 
 regulations would warrant. Subsequently to that he sent notes frequently to 
 my deputy or some of my subordinates; but what the contents were I cannot 
 say, but I presume they were in accordance with my suggestions. On several 
 occasions, when 1 visited the piers in the discharge of my duties, I found bag- 
 gage passed in a manner that did not meet my approbation. On inquiry, I 
 would be informed that it was done under an order or request from the collector; 
 but I directed in these cases that the examination should be made as the law 
 required. On one occasion, on the arrival of the French steamer, I remember 
 going on the dock and saw a large quantity of baggage being passed. On 
 making inquiry, I was told the baggage belonged to a gentleman who had an 
 order from the collector to pass it without delay. I then asked Mr. Van Bus- 
 kirk, and he said it was done by the direction of the collector. 
 
 Q. This direction, then, would mean without examination ? 
 
 A. In that case that was the construction put upon it. These were the only 
 two cases brought directly to my knowledge. I positively prohibited my offi- 
 cers passing baggage without proper examination ; and I insisted that every 
 man's baggage should be treated alike — that is, opened and examined, and that 
 the provisions of the law should be carried out. It is a matter which has given 
 me much annoyance and trouble. 
 
 Q. Is the force of your department limited by law 1 
 
 A. The number of inspectors I have understood to be limited ; but under a 
 recent order those that were called special aids have been sworn in as inspectors ; 
 but I don't know under what law it is done. 
 
 Q. Are any of these supernumeraries 1 
 
 A. None of them. 
 
 Q. Are there any persons on the pay-roll who are rendering merely nomiual 
 services 1 
 
 A. Not to my knowledge. There is a difference in the extent of the labor 
 devolving upon some of the positions. For instance, we assign persons to dis- 
 tricts where, at some times, they are very busy, and at others they have not so 
 much to do. I am opposed to sinecures, and there are none in my department. 
 
 Q. Was there not a man named Bevins appointed, and was it not understood 
 he was to do no duty or anything else but to draw his pay ? 
 
 A. No, sir. Mr. Bevins was an inspector, aud Mr. Draper turned him out. 
 He was out for a long time, and his friends urged me to appoint him in the de- 
 benture room. I said I would appoint him on the express understanding that 
 he would do his duty. I believe he was appointed, and remained in some few 
 months, and did his duty, to a certain extent, hut not to my satisfaction. So I 
 told him he must leave, and I have not seen him since. 
 
 Q. How long ago is that? 
 
 A . About a year and a half ago. 
 
176 
 
 NEW YORK CUSTOM-HOUSE. 
 
 N«W York, January 17, 1SG7. 
 ABBAM WAKE MAX recalled and examined. 
 
 By the Chairman : 
 Q. Have there been a good many changes or removals among tlie attaches 
 or employes of your department of the custom house? 
 
 A. In my department we have had very few removals, and only for cause. 
 
 Q. Why was Timothy C. Dwight removed? 
 
 A. I do not know. 
 
 Q. Who was he removed by? 
 
 A. By the Secretary of the Treasury, I suppose. In regard to changes among 
 the inspectors : The fact that in the list, numbering two hundred, a large number 
 of changes have been made must necessarily affect the system, as experience is 
 a very great requisite, and to change experienced and put in their places Inex- 
 perienced men must necessarily derange the service- more or lees. 
 
 Q. Have you any additional suggestions to give the committee in regard to 
 Mr. Bevins ? 
 
 A. I find that Mr. Bevins was appointed an inspector under Mr. Barney, 
 October 1, 1S62, and was removed on December 26, 1SG4, by Mr. Draper. 
 During the time I was in oflice, he was assigned to a district in connection with 
 another officer ; and his duties were not a- thoroughly performed as I should 
 desire. The duties of district officers are more or less occasional, and he was 
 removed, as I remarked, by Mr. Draper, but was appointed in my department 
 April 6, 1S65, after a long application. The reason he was not earlier appointed 
 was that I feared he would not be able to give the attention to the duties that I 
 required. Upon the express terms that he would perform his duties according 
 to the regulations of the department I appointed him, with the consent of the 
 Secretary of the Treasury. He continued after that to do more or less duty, 
 until finally, his duties not being performed to my satisfaction, on the ISth of 
 August I sent for him to come to my oflice, and I said to him that the duties of 
 the position were not properly fulfilled, and that he should either resign or per- 
 form his duties according to the regulations. The Hon. Win. A. Darling 
 was present at that interview. Bevins turned to Mr. Darling and said that it 
 ■was rather hard ; that he was ready to do duty, but could not do it in the man- 
 ner I required. Mr. Darling said to him, the surveyor is bound to have the 
 duties of his office properly performed, and if you cannot do your duty properly 
 you should resign, lie said, " Boss, if you say so, I will resign." Mr. Dar- 
 ling said, " You had better." I said, " Y^ou must choose which you will do;" 
 and he said, " I will resign." That was in August, 1865, and since then he 
 has had no connection with my department. 
 
 New Y/ork, January 11, 1S67. 
 SAMUEL G. OGDEN sworn and examined. 
 
 By the Chairman : 
 Q. Are you auditor at the custom-house ? 
 A. I am. 
 
 Q. Are all the accounts made up in your office ? 
 A. Yes. 
 
 Q. Are you quite familiar with the contents of each account ? 
 A. Yes. 
 
 Q, In any account rendered in behalf of the collector has any return ever 
 been made of $2o0 per month as received by him as part of the proceeds of the 
 public store cartage business ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 177 
 
 A. No. 
 
 Q. Or any amount ? 
 
 A. No ; nor from any such source. 
 
 Q. Have you a form of the oaths the collector is required to take each 
 month? 
 A. Yes. 
 
 Q. Can you give them to the committee ? 
 A. I can. 
 
 (The witness then put the following copies of the oaths in evidence :) 
 
 I, Henry A. Smythe, collector for the district of New York, do solemnly swear 
 that the above account contains, as I verily believe, a full and true statement of 
 all the fees and emoluments of my office, and of the expenses incident thereto, 
 from the first day to the thirtieth day of November, 1866. 
 
 Sworn and subscribed before me this day of , 1866. 
 
 Oath attached to abstract of storage, labor, and cartage of goods afloat. 
 
 I, Henry A. Smythe, collector of the customs, &c, for the district of New 
 York, do sole:nnly swear that the above account is in all respects, as I verily 
 believe, just and true; that I have neither received, directly nor indirectly, nor 
 directly or indirectly agreed to receive, or be paid for my own use or another's 
 benefit, any other money, article or consideration than therein stated, for or on 
 account of storage, labor or cartage, &e., from the first day of November to the 
 thirtieth day of November, 1866, 
 
 Sworn and subscribed before me this day of , 1S6 . 
 
 I, Henry A. Smythe, collector for the district of New York, do solemnly swear 
 that the above is .a just and true account of the proportion received or retained 
 by me to my own use, of all the sums of money received or collected by me 
 during the month of November, 1866, for fines, penalties or forfeitures, or for 
 seizure of goods, wares and merchandise, or upon compromises made upon such 
 seizure, or on account of suits instituted for frauds against the revenue laws. 
 
 Sworn and subscribed before me this day of , 1S66. 
 
 Q. Are vou acquainted with Mr. Suiytke's handwriting ? 
 A. Yes." 
 
 (The memorandum put in evidence by Francis M. Bixby at this date was 
 here handed to witness.) 
 
 Q. Look at that memorandum and at the initials Y. B. & Co., opposite the 
 name of " Thomson, and three shares," and also at the figures on the back of 
 the memorandum, and say if they resemble Mr. Smythe's handwriting. 
 
 A. I think the initials on the front and the figures and writing on the back 
 of the memorandum are Mr. Smythe's. 
 
 WASHINGTON, January 12, 1S67. 
 MONTGOMERY GIBBS sworn and examined. 
 
 By Mr. Broomall : 
 Q. Give the committee your place of residence and business. 
 A. I am an agent for the Treasury Department in Europe. My headquar- 
 ters are at Paris. 
 
 Q. State, in detail, what your business is as agent for the Treasury Depart- 
 ment. 
 
 A. My business generally is to aid in the apprehension and punishment of 
 frauds upon the customs revenue. My first knowledge of, or connection 
 H. Rep. Com. 30 12 
 
178 
 
 NEW YOKK Cr.STOM-IIOU.-E. 
 
 with, tlic prevention and detection of frauds on the revenue, which, in the be- 
 ginning, was unofficial, was in 1859, when I was counsel for the government in 
 a case in New York city, in which certain investigations wen- found to he ne- 
 cessary at the custom-house. I discovered a very important uid extensive fraud 
 upon the revenue committed by a merchant in New York. I indicated the re- 
 sult of my investigation to the collector of the port, and it was communicated to 
 the then Secretary of the Treasury. Thi< led to my employim nt as counsel for 
 the United States in that case, and to a vi.-it by me to various parts of Europe. 
 The case was the United Slates r.s. Ilerrick. Ilerrick was an American mer- 
 chant in New York city. In my investigations in connection with that case, I 
 discovered tl.at the commission of frauds upon the revenue, by exporters, was 
 very grave ; that the government had, in fact, no checks, except in its custom- 
 houses at home, upon the commission of frauds by undervaluation; no record of 
 the transactions of importers was left in Kurope. Only one invoice of merchan- 
 dise Mas necessary, and that invoice might as well have been made by the im- 
 porter himself as by the consular agents abroad. No arrangement had been 
 made for the prevention of frauds at the place where they were all or nearly all 
 
 conceived and carried on. My connection with that case, and my investigations 
 abroad, led me to make a report on the subject to Secretary Cha-e, on the loth 
 of January, 1862, which report was printed. I have a copy of that report be- 
 fore me and will make it a pari of tin; testimony, if the committee desire it. 
 
 By Mr. Rollins : 
 
 Q. How long were you abroad on your first vi.-it in connection with the Her- 
 rick case, and in what year was it ? 
 
 A. It waa in ISO 1. 1 was absent about one hundred days. 
 Q. When was this case of Ilerrick .-ettled ' 
 
 A. It has not been settled. It never came to trial. It is nearly ready for 
 trial. 
 
 Q. How many years since the fraud was committed in this Ilerrick case, and 
 you commenced proceedings ? 
 
 A. The frauds were, 1 think, invoices running from 1S45 to 1851. It is nearly 
 eight years since proceedings were commenced. In 1S61 our arrangements 
 were perfected for taking the testimony of the principal witness in France, a 
 man by whom one-half the whole case could have been proven. When the wit- 
 ness was produced before the court, in the Department of the Seine, in France, 
 he stated that since his interview with me he had burned all his commercial 
 books, and could not, therefore, give the testimony he had indicated. As to the 
 English testimony, it was in the hands of a solicitor as commissioner. The de- 
 endants had also a commissioner, who refused to attend, and it became neces- 
 sary, in order to take that testimony, to procure the issuing of a new commission ; 
 that commission is now in the hands of the United States consul in London, and 
 I think probably it has nearly concluded the testimony. The report made by 
 me to Secretary Chase, in 1862, led to the preparation of two or three bills, most 
 of which I drew up in accordance with the recommendations of my own report, 
 and which were passed by Congress. The principal one of these acts for the 
 prevention and punishment of frauds on the revenue received the approval of 
 the President, ou the 3d of March, 1S63, and I refer to that as a part of my tes- 
 timony, also. 
 
 Q. Did you prepare that bill'? 
 
 A. Most ly. Mr. Barnard, collector at Xew York, the Solicitor of the Treasury, 
 and Secretary of the Treasury, had several cousultations, and after that it was 
 changed somewhat, but it was substantially a reproduction of my recommenda- 
 tions in this report. On the 18th of March, 1S63, I was appointed a revenue 
 agent by Secretary Chase, and soon after was instructed to make investigations 
 n the New York custom-house, with reference to going abroad, and carrying out 
 
NEW YORK CUSTOM-HOUSE. 
 
 179 
 
 the suggestions I had made for the prevention of frauds upon the revenue. I 
 remained in New York for some time after that, and left finally about the middle 
 of July, 1S63. Since my arrival in Europe, very late in July, 1863, 1 have up 
 to this time been constantly engaged in researches under my instructions, with a 
 view to the prevention and punishment of frauds upon the revenue. 
 
 By Mr. Bromall : 
 
 Q. State what your plans were, and how you went about this. 
 
 A. The bill to which I refer, in accordance with my recommendations, pro- 
 vided that instead of allowing importers to furnish but a single copy of the in- 
 voice, which, after the goods were passed, went into the records of the custom- 
 house, and could not be seen by anybody, required that a duplicate should be 
 filed with the consul at the consulate nearest the place where the goods started 
 upon their journey from Europe to the United States, for the inspection of such 
 agents as the Treasury Department would appoint for that purpose. The agent 
 is thus enabled to ascertain, by an examination of the invoice on file, what were 
 the transactions of the shippers, and the price of their merchandise enables him, 
 if he is vigilant and active, to furnish information if the invoice was false in sea- 
 son to prevent the entry of the merchant'. I was required by my instructions, 
 and I have continually proceeded in fulfilment of them, to make extensive and 
 careful inquiries in relation to the true market value of merchandise, from every 
 source to be relied upon, comparing the information so obtained with the facts 
 and figures put down in the invoice. 
 
 Q. State whether you resorted to any other means than merely collecting in- 
 formation in the neighborhood where the manufacturers were, and comparing the 
 prices as ascertained by you with the invoices. 
 
 A. Nothing except simply inquiring into and investigating the market price 
 or value. 
 
 By Mr. Warner : 
 
 Q. That was personal, as I understand ; you did not employ any detectives? 
 
 A. No, sir, there has never been anything of the nature of a detective in our 
 operations. For instance, I have never directed my inquiries into the business 
 affairs of any person absolutely engaged in the shipment of merchandise when 
 I was seeking to ascertain the market value of the article shipped. I have in- 
 quired of other people shipping the same merchandi se, and of other people deal- 
 ing in it, and have so ascertained the market price. 
 
 By Mr. Broo.mall : 
 
 Q. If you have employed other persons to assist you, please mention their 
 names. 
 
 A. By permission of the State Department, Louis W. Violier was assigned 
 for duty under me when I deemed it necessary to employ him. 
 Q. What were his functions ? 
 
 A. His functions were to ascertain for me the market value of merchandise 
 in the different markets. I employed him chiefly on account of his great facility 
 in the French language as well as for his general intelligence. He was born in 
 Switzerland. I have, from time to time, for brief periods, employed other peo- 
 ple, but always with the understanding that their connection with our efforts 
 should not be disclosed, because it would have injured them seriously in their 
 business relations. 
 
 By Mr. Rollins : 
 
 Q. What relation had this gentleman with the State Department ? 
 
 A. He was consul at Lyons for a time, and is still consular clerk under the 
 consular clerks bill ; now assigned permanently for six months for duty in our 
 department. 
 
180 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. What other facilities (.lid lie have besides his familiarity with the French 
 language 1 
 
 A. lie had been twelve years, or about that time, employed in New York in 
 a silk importing house; and his knowledge of the market price, value, and 
 quality of .silk goods was very great. 
 
 Q. Now, please give us the modus operandi of arriving at the value of goods 
 abroad ? 
 
 A. Before the enactment of what was known as 1 1 1 « * sample act or measure, 
 the method of ascertaining the value; of all merchandise was by inquiring of 
 dealers in that kind of merchandise and the inspection of invoices. As to many 
 kinds of merchandise, as in the case of wine, thai was very easy without a 
 sample. A description of it w as a suliicient bans of inquiry. For instance, as 
 to the Bordeaux wines, it w as suliicient to say, We w ant to know the market 
 price of the chateaux Lafitte of a given year. As to textile fabrics, it was 
 more difficult, because it was next to impossible to ascertain of anybody, by a 
 verbal description, w hat was the price of merchandise, the character, texture 
 &c, of which they had not seen. 
 
 Q. Were your inquiries verbal or by correspondence 1 
 
 A. Verbal, generally. There were some instances in which there was corre- 
 spondence ; and, as to textile fabrics, almost universally, so far as I made in- 
 vestigations. 
 
 Q. When your agent went to inquire the ju ice of an article, what representa- 
 tions did he make ? 
 
 A. Mr. Violier never made any researches into the market value of any tex- 
 tile fabrics except as consul ; and that was done in his own office, upon his own 
 responsibility as consul. The only inquiries he has made under my directions, 
 when assigned for duty to me, have been with respect to wines, I think, entirely; 
 and these inquiries were made through the medium of persons with whom he 
 was personally acquainted at BorTleaux; and he, so far as I know anything 
 about it, never represented himself in any other light or capacity than that he 
 held. 
 
 Q. Suppose you take a particular brand of champagne, manufactured by a 
 certain house, how would you ascertain the market value of that except by in- 
 quiring of the proprietors? 
 
 A. It could be very easily ascertained by inquiry at their agencies, where 
 printed prices current are presented to people inquiring. 
 
 Q. You would have to then substantially inquire of the parties themselves? 
 
 A. Yes, it was the same thing, though we made it a rule never to inquire of 
 principals if the information could possibly be obtained in any other way. Ship- 
 pers were first required to furnish samples of merchandise by order of the con- 
 suls under a general direction that they should ascertain the market value of 
 the merchandise before certifying to invoices, leaving it discretionary for them 
 to ascertain by any methods they pleased. Mr. Bigelow insisted that he had 
 a right to require a man to prove that he had invoiced his merchandise at the 
 full market value. Afterwards Congress passed an act defining the rights and 
 duties of consuls in this regard ; then having samples of merchandise, it was very 
 easy to ascertain its market value. My course was to divide these samples and 
 make inquiry of persons in the trade as to the value at a given time of mer- 
 chandise — as to the kind and quality exhibited. If the valuation was found to 
 be incorrect a report was made of the variations between the invoiced price and 
 the true market price, which report was forwarded by me to the Treasury De- 
 partment. 
 
 Q. What would be the result of these reports; would they stop the landing of 
 the goods 1 
 
 A. That ought to be done if the report could be received in time, and then 
 
NEW YORK CCSTOM-HOUSE. 
 
 181 
 
 under the law a seizure ought to be had. Or if the merchandise had gone into 
 consumption, then action should be commenced for its value. 
 
 By Mr. Broom all : 
 Q. Was there any employe of yours besides Mr. Yiolier ] 
 A. For a time there was another. His name was Edward Leuchtenrath. 
 Q. How long was he in your employ 1 
 A. Several months ; I should think six. 
 Q. What were his duties ? 
 
 A. I employed him as assistant for the purpose of aiding me in ascertaining 
 the value of merchandise, particularly wines, he having been engaged as agent 
 or salesman for one of the champagne houses, formerly, and claiming to have 
 and really having considerable knowledge on the subject of the valuation, par- 
 ticularly of champagne wines. 
 
 Q. Did you give him any written orders, or did you have no written agree- 
 ment ? 
 
 A. I do not know that I ever had any written agreement with him that I can 
 state to-day, but I think I must have given him written orders. 
 Q. Will you state what they were ? 
 
 A. I have no papers with me that relate at all to the employment of Leuchten- 
 rath, not anticipating that anything would be said about him here, so that I 
 must depend upon my recollection. I employed him at first at a salary per 
 month, to aid me in ascertaining the value of merchandise; with special refer- 
 ence, however, to champagne wines. I paid him, I think, one hundred dollars 
 a month, and. there was an additional understanding that, inasmuch as he was 
 a citizen of Germany and a citizen of France, and his connection with our 
 efforts to punish frauds upon the revenue would necessarily work him an injury, 
 I undertook to recommend to the department that in case the information fur- 
 nished by him to me was of considerable importance or value, some additional 
 provision should be made for him. 
 
 Q. In what way was that additional provision to be made for him ? 
 
 A. I do not think I ever said anything about that. What I recommended 
 was that in the future, if his services proved valuable, something in the nature 
 of a contingent interest should be provided. 
 
 Q. Contingent interest in what ? 
 
 A. In the seizures and forfeitures. He procured a good deal of information 
 which afterwards turned out to be valuable in champagne cases. He made one 
 visit with me to the champagne country, and a good deal that transpired there 
 was valuable in relation to the champagne controversy. 
 
 Q. Did he ever receive anything from that recommendation of yours % 
 
 A. Nothing, I think ; I am quite sure he never did. 
 
 Q. Had he a place of business in Paris ? 
 
 A. Yes. 
 
 Q. What was his ostensible business ? 
 
 A. Commission merchant. I will now go on with my statement, if the 
 committee please, in regard to my transactions with Leuchtenrath. When 
 this information that he obtained was all collected, I took it, he acting as 
 my clerk. I deemed that the government had a right to the results of his 
 labors. I took it under my charge and reported it to the Treasury Depart- 
 ment. I had on one or two occasions made other recommendations to the 
 Solicitor of the Treasury. I recollect one or two letters, in which I urged that 
 his disclosures were valuable, and that, if used in our behalf, they might work 
 injury to him, and recommended that some proper arrangement might be made 
 by which he might be compensated. I am quite sure I did that on two occa- 
 sions. I received no reply, and did not learn that any seizures were made on 
 the recommendation which I had made, based on what I had done, and on a 
 
182 
 
 NEW YORK CUSTOM-HOUSE. 
 
 very considerable amount of evidence which I had procured outside. Xot only 
 was no action taken on my recommendation in respect to additional compensa- 
 tion for this man, but no seizures were made for a long time; nor did I receive 
 what I had applied for twice — authority to continue him in my employment. 
 He was employed at twelve hundred dollars a year. I was employed at two 
 thousand dollars. I did not wish to risk the employment of a clerk WDO06 
 salary was almost as much as mine, without distinct authority from the depart- 
 ment. This was in ls<;:j, I think. Xot hearing -from my application to continue 
 him in my employment, I stated to him that it would !"• necessary for DM to 
 part with him. J also stated to him that it was my intention to recommend 
 that, if seizures were made, and his testimony was of value, he should ree< iv<- 
 adequate compensation for it. He expressed a good deal of indignation ami 
 disappointment at my announcement that I had no authority to continue him 
 in my employment, and could not. He said many offensive things, and, 1 think, 
 wrote me a good many rather offensive letters, to which I paid no attention, 
 because I had been very careful to explain how my powers were limited ; that 
 seizures had not been made up to that time, and that I was powerless to do 
 anything further, although I had faithfully complied with my contract with 
 him to pay him his one hundred dollars a month, which was an adequate salary. 
 These seizures were recommended by me in a communication to the Treasury 
 Department, dated, I am quite sure, the 16th of November, 1863. In that 
 letter I recommended sweeping seizures of champagne wines That recom- 
 mendation I followed up with a further recommendation, furnishing in my sub- 
 sequent letter a tabular statement, giving the names of the manufacturers of 
 champagne wines who were engaged in defrauding the government, the extent 
 ot their operations, the real value of their products, and the figure at which 
 they invoiced them, and at which they were entered at the custom-house, the 
 amount of their entire valuation, and the amount of loss which the government 
 sustained by reason of their fraudulent undervaluation. These recommenda- 
 tions I understood were transmitted to the proper officers of the customs, but 
 no action Avas taken on them that I could ever learn. No action, I believe, was 
 taken on these reports of mine till some time in 1SG4, Mr. Farwell, the naval 
 officer in San Francisco, now revenue agent, came to Europe and met me at 
 Frankfort- on-the-Main, in the mil of 1S64. He stated that he had seen my 
 reports filed away in the appraiser's office in New York ; that no action had 
 been taken on them, as he understood it, because the general appraiser did not 
 believe it was possible such frauds had been committed. 
 
 By Mr. Warner : 
 
 Q. Your reports reflected on the general administration of the general ap- 
 praiser, did they not 1 
 
 A. Yes, sir. He depended on the high character of the merchants. He did 
 not know anything about the value or character of wines. I went with him 
 into the wine room because he was ex officio the man who did the appraisement, 
 and he literally knew nothing about it. He never tasted wines or liquors. Mr. 
 Farwell said he had taken up the report, that seizures had been made, and he 
 was there to aid me in further strengthening and arranging the testimony. I 
 went over with him the whole history of my plans and arrangements with refer- 
 ence to this case, and stated what I had done in the matter of Mr. Leuchtenrath ; 
 that I had been obliged, for want of authority to retain him, to discharge him, 
 but that it was not too late to procure his services, and urged him, if he felt 
 authorized to do so, to allow me to see Leuchtenrath and re-enlist him. He 
 thought it important that Leuchtenrath should be employed. I had an in- 
 terview with him. He was willing to enter the service. We had an amicable 
 understanding as to our former matters. He made some little claim for some 
 balance or other, which, however, he waived at my suggestion and gave me a full 
 
NEW YORK CUSTOM-HOUSE. 
 
 183 
 
 acquittal of all claims. I, intending to protect myself and the government from 
 any alleged claims he might make growing out of the promises I had made to 
 ask that something might be done for him, took his full receipt, which I have 
 seen within a day or two at the Treasury Department. He was willing to 
 accept employment as an expert and go to California or wherever these cases 
 were to be tried, and to state all the facts he knew hearing upon the value of 
 these wines. Mr. Farwell made a written contract with him, which was very 
 carefully drawn. He did go in pursuance of that contract to California, proceed- 
 ing, I think, in advance of Mr. Farwell and myself, for I had been instructed to 
 go to California to aid in the trial of the cases. When I reached California I 
 found Mr. Leuchtenrath there engaged in the custom-house. I conversed with 
 him with respect to the cases and his evidence for them. In due time he was 
 put upon the stand to prove the market value of one of the wines in controversy, 
 and stated on the stand, in substance, that he knew nothing about the value of 
 champagne wines ; that he did not know the different kinds and brands of wines ; 
 in fact, in substance ignored any knowledge of the subject whatever. He was 
 dismissed from the stand as a matter of course, and during the recess the attor- 
 ney of some of the defendants stated to me that Leuchtenrath had offered him- 
 self to the defendants as a witness for them for a considerable consideration; that 
 he had, as he stated, indignantly refused to treat with a person who he knew was 
 in the employment of the government; that he did not know to what frauds it 
 might lead, aud he thought it proper to give the information. This gentleman 
 was, as I stated, counsel for some of the defendants, a Mr. Sidney Smith, a 
 gentleman of very high character. We tried the rest of the cases without him, 
 and won all of them, the juries remaining out sometimes two minutes and some- 
 times live. 
 
 Q. What was the value of the seizures ? 
 
 A. I don't know that I ever knew. My impression is the value was from 
 three hundred and eighty to four hundred thousand dollars. 
 Q. Was anybody paid as informer ? 
 
 A. No, sir; not at all, within my kuowledge. It was done by the regular 
 officers of the government. Afterwards, a German, representing himself to be 
 an old townsman of Leuchtenrath, came to me and stated that Leuchtenrath had 
 committed a grave offence, but that he regretted what he had done ; that he 
 failed of his object ; he procured nothing, and that he was lefc consequently 
 penniless, and at the mercy of the United States and its officers, but begged me 
 to restore Mm to his position long enough to enable him to get back to France. 
 I declined to have anything to do with him, even to see him, but stated that if 
 Mr. Farwell was willing to entertain the proposition for the purpose of aiding 
 him to get back, he might do it. He did see Mr. Farwell, and Mr. Farwell, I 
 think, ordered him out of his store. Since then I have not seen Leuchtenrath 
 nor known anything about him. 
 
 By Mr. R014JNS : 
 Q. How happened you to employ him originally ? 
 
 A. He was very strongly recommended to me by, I think, three mercantile 
 houses in Xew York and by his especial friend, a man in whom I had very great 
 faith, Mr. Weichman, of the house of Reed, Taylor & Co., large importers of 
 precious stones. He first called my attention to Leuchtenrath. He wrote and 
 spoke tolerably well five languages, and promised at one time to be very valu- 
 able to me. 
 
 Q. Was he recommended by men who knew him up tothe timeof his employ- 
 ment ? 
 A. That I know nothing about. 
 
 Q. What business had he actually been engaged in in Paris before you em- 
 ployed him 1 
 
184 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. lie had been a partner with his brother in a commission house. 
 Q. What was the business ? 
 
 A. He himself, I think, had sold wines for one of the leading houses in Pari.-. 
 Q. "What kind of goods did the house sell on commission I 
 A. That I don't know, because the bouse had failed and gone out of business 
 before I saw him. Sly belief* is, that they were shipping goods of a miscella- 
 neous character to China. J knew from Leuchtenratn that he sold champagne 
 
 wine for one of the houses there. I tliink there was a wine marked "Lenchtcn- 
 rath & Brothers," but the house had failed and i can't State anything of my ow n 
 knowledge. 
 
 By Mr. Bboomall: 
 
 Q. State in how many instances seizures were made in consequence of the 
 information furnished to the government by you from abroad. 
 
 A. It would be impossible for me to state exactly. The seizures have been 
 very numerous, but not so numerous by any means as they ought to have been. 
 
 Q. What is the present condition of the cases in which seizures were made? 
 Have any of them been tried except those you spoke of in California 1 
 
 A. Some of the cases have been settled, and they called that a trial. Of all 
 the case reported by me in which seizures had been made, the only trials before 
 juries of which I know anything up to to-day are the trials of the champagne 
 cases in San Francisco. 
 
 Q. State the cases in which pro forma trials were gone through in consequence 
 of compromise. 
 
 A. There was one case pnt through the form of a trial, and the report was 
 shown me at the Treasury Department, and I complained with reference to it. 
 
 Q. Will you state the amount at which that case was compromised? 
 
 A. I saw the record in the Treasury Department. The amount was stated 
 at fifty-one thousand and some hundred dollars. I have understood that the 
 aggregate amount was properly fifty-three thousand, the marshal's fee or some- 
 thing of that kind having been taken out. 
 
 C|. What portion of this money went to the United States ? 
 
 A. I saw the apportionment on the records of the Treasury Department. 
 The division was after deducting the usual payment of expenses ; one-half to 
 the United States and the other half in equal portions to the three revenue offi- 
 cers of the port, giving them nearly nine thousand a piece, the collector of the 
 port, naval officer, and surveyor. 
 
 Q. Will you state whether there was any informer in the case on the records? 
 
 A. There was an informer who got on the record after the case was settled. 
 
 Q. AY ho was he? 
 
 A. Gerrard, a French gentleman, who made application and went on the 
 record subsequently as informer. 
 
 Q. What was the full amount of the goods seized ? 
 
 A. My impression is they made pro forma seizures of a* few cases. I have 
 stated to the Treasury Department that the cases were settled for ten per cent, 
 of the amount due the government. 
 
 Q. Who was the prosecuting officer in New York; who was the solicitor for 
 the United States ? 
 
 A. Of course I don't know of my own knowledge ; I was in Europe at the 
 time ; the name of the district attorney, Mr. Dickenson, appears on the record. 
 Mr. Waterman once wrote me that it was settled at the request of Mr. Dicken- 
 son, but that the case was arranged in*the custom-house. 
 
 Q. Do you know whether there was any other evidence submitted in the 
 cases except that furnished by you ? 
 
 A. I never heard of any. 
 
NEW YORK CUSTOM-HOUSE. 
 
 185 
 
 Q. Was there any arrangement by which you were entitled to any portion of 
 this money 1 
 
 A. There was an understanding between Gerrard and myself, a mere informal 
 understanding, that if his information was effectual I should receive something 
 out of it — what, I can't recollect. 
 
 Q. Probably one-half? 
 
 A. No, I think not. My impression is twenty per cent, of what he recovered 
 as informer. Before that time it had been left to me to inform myself or not, as 
 I pleased ; but the revenue officers in New York objected to leaving me liberty 
 to do it or not as I liked it, because if I did I could then force a division with 
 them of their perquisites. It had therefore never been my intention to do it, 
 and I did not until recently ever claim anything, directly or indirectly, as an 
 informer. The first case was this understanding with Gerrard, which was an in- 
 adequate one. I never contemplated having any interest in any seizure till 
 May, 1865, when in Washington I called the attention of the present Secretary 
 of the Treasury to the valuable results of my mission, to the entire success of 
 my mission, to the meagreness of my compensation. He stated that the com- 
 pensation was in his opinion inadequate, and asked in substance if there was no 
 provision of law by which it might be increased. I think I stated there was no 
 provision except as to informers, of which I hesitated to avail myself. His 
 exact reply I cannot recollect in language, but it was in substance that I might 
 avail myself of it or not, as I pleased. I then determined that if nothing was 
 done by the department to increase my emoluments, (for they were considerably 
 below the very first cost of the necessities of life,) I would, in some cases, at 
 least, avail myself of my right and divide with the revenue officers their portion. 
 I acted on that determination in some of the New Orleans cases, and I think in 
 some glove case in Boston. I believe I have never done so in any other case 
 up to this time. 
 
 By Mr. Rollins : 
 
 Q. Did you receive anything in what is known as the Williams case in Bos- 
 ton? 
 
 A. Nothing. The Williams case was distinctly referred to. The informa- 
 tion on which that seizure might have been based, on which I think it was 
 based, was contained in my original reports and despatches of November and 
 December, 1863, and January, 1864. The first knowledge that any steps had 
 been taken in the Williams case came to me in California, when Mr. Farwell 
 told me that a seizure had been made in that case, that a considerable sum 
 would be realized, but I had no interest in it and never have received any por- 
 tion of it. 
 
 Q. Did you ever have any conversation with Farwell with reference to re- 
 ceiving any portion of that money ? 
 
 A. Mr. Farwell said to me at the time he stated that the Williams seizure 
 had been made, that it would result in something, and that he would treat me 
 liberally in it. Nothing further was said. Afterwards, when I saw a state- 
 ment made of the controversy in Mr. Goodrich's pamphlet, I think, while in Eu- 
 rope, I reminded Mr. Farwell of what he had volunteered to say to me in Cali- 
 fornia about the matter. He seemed to be piqued and offended at my mention 
 of it, and then stated that it was not on my information that the seizure had 
 been made, but on the basis of a price current which he had procured of some- 
 body in Paris. 
 
 Q. Was he the informer in that case 1 
 
 A. Yes, sir. He informed in that case. Seeing that the subject was not 
 pleasant and that a continuation of the conversation about it would not be agree- 
 able I ceased mentioning it, and he never referred to it since. 
 
18G 
 
 NEW FORK CUSTOM-HOUSE. 
 
 Washington, January 14, 1SC7. 
 
 MONTGOMERY GIBBS appeared, and hit examination was continued, an 
 follows : 
 
 By Mr. BftOOMAL : 
 
 Q. Have you anything* to add to what you have already stated? You were 
 answering generally a question in reference to the number of seizures made and 
 the part you had taken in them; and you had finished hy saying that only in 
 one single instance had an arrangement been made by which yon were to receive 
 any part of the forfeiture, and that had not hem carried out as yet. 
 
 A. I do not think you recollect it quite right; in all the win.- cases at New 
 
 Orleans I had. 
 
 Q. If you have nothing further to add to that, I ask the same question in 
 respect to other seizures. What other seizures had hcen made, and what inter- 
 est bad you in them, directly or indirectly \ 
 
 A. Other than what ? 
 
 Q. Other than the wine cases of which you speak. 
 
 A. The only case in which I have any interest, other than the wine cases, 
 in which seizures' have heen made, growing out of my. informations, of course, 
 is the small case of gloves at Boston. I have made recommendations of seiz- 
 ures in other glove cases at New York, hut no seizures have heen made. My 
 action in this is yet to he determined, if any seizure is to he made. 
 
 Q. What is the name of the defendant in the glove case iu Boston ? 
 
 A. Goodsell & Co. 
 
 Q. What is the amount of the seizure ? 
 
 A. My impression is it is 15,000 francs, or in the neighborhood of $3,000 — 
 less than that. 
 
 Q. Can you give the committee an idea of the numherof cases in which you 
 have recommended seizures ? 
 
 A. Without reference to my books and papers I could only give an indefinite 
 idea, because my recommendations for seizures have been constant for four 
 years. 
 
 Q. Give us some idea of the number of distinct invoices in which you have 
 recommended seizures. 
 
 A. It is very difficult ; it would be a good many invoices. 
 
 Q. Ts the committee to understand that in all cases, if seizures are made, it 
 is at your option whether you are interested 1 
 
 A. There never was any understanding on the subject ; but my understand- 
 ing and intention, up to the wine cases, was not to do so, not to nave any inter- 
 est, not to file any claim. 
 
 Q. Ton speak of the conversation you had with the Secretary of the Treas- 
 ury, in which he intimated it would not be improper for you to be interested. 
 State when that conversation took place. 
 
 A. In May, lS6o, on my way from Europe to San Francisco, where I was 
 going to try the champague and other cases. I had some conversation with 
 the Secretary of the Treasury in respect to the enormous undervaluation of 
 merchandise, and the success which had followed the efforts made to disclose 
 the nature and character of those undervaluations, and spoke incidentally of 
 the meagreness of my salary, which, without the government tax, would be 
 $1,930 a year, and asked him then if he deemed it just or proper that an officer 
 rendering such services should receive such compensation. He replied by ask- 
 ing if the law did not provide some compensation. The Solicitor of the Treas- 
 ury was present when that question was asked, and the question was rather 
 addressed to him. The Solicitor replied that there was, and the Secretary in- 
 timated — though I cannot state his language — that it would not be improper 
 for me to do it if I pleased. 
 
NEW YORK CUSTOM-HOIjSE. 
 
 187 
 
 Q. Tbe Solicitor decided .you were entitled to pay as an informer? 
 
 A. No, sir, lie did not decide ; but he said the law would allow it if I pleased 
 to avail myself of it. 
 
 Q. Do I understand you to say that in no instance have you received money 
 in any way out of the cases since the conversation with the Secretary ? You 
 spoke of cases which had not been determined. Have any been determined so 
 far as to allow you to leceive money ? 
 
 A. I have never received, up to this time, any money, directly or indirectly, 
 out of any seizure made at my recommendation. Whether I do or not depends 
 on the successful trials of some contested cases, to wit : the wine cases and the 
 little glove case. 
 
 Q. Those are the only two cases in which you are interested ? 
 
 A. A great many of the wine cases. The wine cases and the little glove 
 case were all the seizures which had been made. I have alluded to seizures in 
 other cases where the revenue officers betrayed a great weakness. 
 
 Q. In those cases what proportion of the forfeiture are you to receive? 
 
 A. My action with respect to them is yet undetermined, because it has been 
 my determination not to exact the legal amount. The law would give me one- 
 half of the amount which now goes to the revenue officers. 
 
 By Mr. Eolllxs : 
 Q. One-fourth of the whole amount? 
 
 A. Yes, sir ; leaving the government in the same position, but affecting that 
 of the revenue officers. 
 
 Q. Give the committee an idea of what the aggregate would be, supposing 
 all the cases to he successful to the extent that you expect? 
 
 A. I have never received a list of the cases with the proposed amount, so it 
 would be only a" matter of guess-work ; but my impression is that in francs the 
 amount at San Francisco would be 200,000 francs. My impression is that at 
 New Orleans it is about 400,000 francs, and at New York something more than 
 either of the other sums ; I cannot state the amount. I could if I could refresh 
 my recollection from the papers. 
 
 Q. Cannot you do that here ? 
 
 A, My impression is I have heard it stated that the appraisements at New 
 York in the wine cases amounted to about $400,000 currency. That I get from 
 Mr. Farwell. 
 
 Q. One-Fourth of which is to be yours ? 
 
 A. No, sir ; Farwell claims the informer's share in those cases. In respect 
 to them he has only stated to me that I should be interested with them. 
 
 Q. He occupies the same position in respect to the government that you do ? 
 
 A. Yes, sir ; he claims to have given information in these cases when he was 
 naval officer. I think our claims in those cases would conflict. 
 
 Q. Has any arrangement been made between ycu and Mr. Farwell in respect 
 to those cases ? 
 
 A. There was an arrangement in respect to them while he was naval officer. 
 Q. AYhile you were in your present position ? 
 
 A. Yes, sir; I think while I was in San Francisco, by which our claims were 
 not to conflict, and we were to have an equal interest ; something to that effect. 
 
 Q. You have already stated your clear salary as $1,930 in gold? 
 
 A. Yes, sir; payable in gold when I am in a foreign country, and in currency 
 when I am in my own country ; it is fixed by Congress. 
 
 Q. Throwing aside for the present this opportunity to be compensated by 
 seizures, are there any other perquisites ? 
 
 A. No, sir. 
 
 Q. Any other means of making money out of it ? 
 
188 
 
 NE\V YORK CUSTOM-HOUSE. 
 
 A. Not the least. It would be not only improper but illegal to make money 
 out of the office in any way. 
 
 Q. How long have you been employed by the government in this capacity ? 
 A. My appointment dates 18th March, 1SG3. 
 
 Q. And during that time you have received no compensation except $1,930, 
 directly or indirectly ? 
 
 A. No compensation as an officer of the government. I was paid what 
 amounted, I think, to about $1,300, as counsel in the triall in San Francisco. 
 
 Q. By the government ? 
 
 A. It was taxed in the case. 
 
 Q. And came out of the forfeitures ? 
 
 A. Yes, sir ; the amount was about SI, 300. 
 
 Q. This was while you occupied your present position ? 
 
 A. Yes, sir; during the time I held it. 
 
 By Mr. WARNER : 
 
 Q. Taxed, not as costs, but taxed in the case as disbursement ? 
 
 A. I think it was taxed as costs. The district attorney said he had taxed it; 
 what amount I do not know. 
 
 Q. Is there any way to tax the United States, except he returns you as as- 
 sociate counsel ? 
 
 A. He might have done so, as that was my capacity. It was done under 
 special authority. 
 
 By Mr. Rollins : 
 Q. From whom ? 
 
 A. I think the Treasury Department, Mr. Fessenden. 
 
 By Mr. Broom all : 
 Q. Being taxed in the case, it would come out of the whole fund ? 
 A. I so understood it. I acted as counsel in all those cases except two. 
 
 By Mr. Warner : 
 Q. How long did the trial of those cases take ? 
 
 A. Pretty nearly all the time for forty-three days. I reached San Francisco 
 the 1st of July, and constantly acted until the first day of September, sixty days. 
 
 Q. It took that time to prepare them. That was not the time they occupied 
 the court ? 
 
 A. I think we tried seventeen ; some of them occupied a week. We may 
 not have tried so many, but we were pretty nearly all the time for forty-three 
 days occupied in trying those cases. / 
 
 By Mr. Rollins : 
 
 Q. You state your salary at $1,930. Does not the government pay all your 
 expenses, travelling and otherwise? 
 
 A. My personal travelling expenses are paid. 
 
 Q. Your expenses to and from California were paid by the government 1 
 A. Yes, sir. 
 
 Q. You received, while there, at the rate of 81,930, as agent of the govern- 
 ment ? 
 
 A. Yes, sir. 
 
 Q. And $1,300 as counsel ? 
 A. About that. 
 
 Q. Can you furnish the committee with a detailed statement of your expenses 
 since you held the office of agent ? 
 
 A. I could not without my books, which are not here. The Treasury De- 
 partment could do it. 
 
NEW YORK CUSTOM-HOUSE. 189 
 Q. Will you furnish the committee with them 1 
 
 A. The committee can get it from the proper officers of the treasury, and I 
 would have to ask the same officers for it. 
 
 Q. This $1,930 and your expenditures during this period are all the money 
 you have received from any source whatever % 
 
 A. I have had some rents and collected some debts. 
 
 Q. I do not mean in reference to your private affairs. I do not mean to in- 
 clude any rents. 
 
 A. If you will say received when, and how, and in what capacity, I will an- 
 swer. 
 
 Q. I mean aside from any income from your individual property. 
 A. My only receipts, direct or indirect, except from my individual property, 
 were my salary and my counsel fee in those cases. I recollect of nothing else. 
 Q. You say you received nothing else 1 
 
 A. I say I recollect nothing else, but I believe I have received nothing else 
 except my personal travelling expenses. 
 
 By Mr. Broom all: 
 
 Q. You say you have recommended seizures in a great many cases where 
 they have not been made. Give the committee an idea of the proportion of 
 seizures which have been made of those recommended. Were they one-half, 
 one-fourth, one-tenth, or what other proportion 1 
 
 A. In cases where the information has been sufficient for seizures, I do not 
 think more than one-fourth. 
 
 Q. Can you give the reason why seizures have not been made 1 
 
 A. I have not ascertained. # 
 
 By Mr. Rollins : 
 
 Q. Have you furnished the government with evidence upon which to make 
 these seizures ? 
 
 A. Generally with what I deemed sufficient evidence ; at least that has been 
 my rule. 
 
 Q. Have you furnished the government with all the evidence in these cases 1 
 
 A. Always a statement of what the evidence would be. 
 
 Q. Have you furnished them all the evidence you have accumulated ? 
 
 A. Always. 
 
 Q. Ir every instance 1 
 
 A. In every instance. It is not strictly proper to say, with the evidence, for 
 that only appears on the trial. 
 
 Q. You furnished them with the evidence you would collect. Have you 
 always furnished them with it ? 
 
 A. Yes, sir. 
 
 By Mr. Warner: 
 
 Q. In these cases where seizures have not been made, and you have furnished 
 the government with information, has the government stated that the evidence 
 was unsatisfactory? 
 
 A. The only instance in which a direct application was made to me for further 
 evidence was in a glove case. 
 
 Q. Before they would suffer or order seizure 1 
 
 A. Yes, sir. 
 
 Q. The seizure was subsequently made ? 
 A. The seizure has not yet been made. 
 
 Q. You received from the department no information of the reasons why they 
 refused to act ? 
 
 A. Those reasons come from the custom-house, and I have had no conference 
 
190 
 
 NEW YORK CU8TOM-HOU8E. 
 
 with the custom-house on the subject, and only in the case referred to have I 
 had intimation that they required farther evidence. 
 
 By Mr. Bboomall : 
 Q. It lias b.'cn alleged that Mr. Leuehtenrath pretended to be following the 
 business of a commission merchant while negotiating with you, and in that ca- 
 pacity wrote to different wine and oilier merchants and manufacturers, to know 
 at what rate they Would furnish him, for exportation, certain articles. Do you 
 know anything about that, and whether it resulted in anything I 
 
 A. I know Mr. Leuehtenrath was and had been for a long time a commission 
 merchant. We did write such letters to different dealers in wines to state their 
 wholesale prices for wine. 
 
 Q. Was that done pursuant to arrangement with you ? 
 
 A. Yes, sir. 
 
 Q. Did that lead to any action relative to seizures \ 
 
 A. It led to the receipt of prices current from several champagne houses. 
 
 Q. Did you look upon that as reliable information of the prices at w hich these 
 men would furnish the article to customers ? 
 
 A. I think these letters generally stated the fact ; that was the price at which 
 they furnished to regular dealers. The letters are in proof and will show that. 
 
 Q. You said you resorted to no means in the nature or way of a detective; to 
 ascertain the price of these commodities. Will you state if, at any time while 
 you were in the employ of the government, you passed under the name of Hill, 
 and under that name wrote letters I 
 
 A. I never passed under the name of Hill. The explanation of that matter 
 is : the Hill letters presented in the champagne cases were, in each instance, I 
 think, written by me with the permission of Mr. Hill, from whom I requested 
 permission. That was after my discharge of Leuehtenrath. 
 
 Q. Did information obtained under that name lead to seizures ? 
 
 A. It furnished corroborative evidence, and if received before seizures, was part 
 of the evidence on which they were based. As to the commodities, I cannot 
 state. 
 
 By Mr. Rollins : 
 
 Q. What was the date of the discharge of Leuehtenrath ? 
 
 A. I cannot say now. My impression is that 1 employed him in October or 
 late in September, 1SG3. I do not recollect whether it was four months or six 
 months when he ceased to do anything for inc. I have not the books or papers 
 from which I could state the exact time. All the Hill and Leuehtenrath letters 
 were produced upon these trials as part of the plaintiff's case. 
 
 By Mr. Warner : 
 Q. You mean copies ? 
 
 A. Yes, sir, copies of the letters, but the originals of the letters received in re- 
 ply. The originals of the letters were never produced by the claimants. In 
 fact, little was said about them on the trial. There was nothing in the nature 
 of detective service ; so my instructions are, and I have confined myself to the 
 ascertainment of proof of the market value, in the open market, of foreign com- 
 modities. But I have always pursued the policy of ascertaining that from other 
 people than those interested, if possible, and to demand nothing more of the peo- 
 ple suspected than the true market price in the nature of price current, or what 
 not. 
 
 Q. I suppose the man who manufactures wine has his regular customers, and 
 a man who may inquire would not get as favorable terms as one who took a large 
 quantity and had an established business. 
 
 A. Not quite ; but the percentage would not be great. The difference would 
 
NEW YORK CUSTOM-HOUSE. 
 
 191 
 
 be between three and five per cent. In the wine cases the proportion was from 
 twenty to one hundred and twenty. In some of the wine cases the underval- 
 uation runs to three hiRlred per cent. 
 
 By Mr. Rollins : 
 
 Q. Do not some of the champague houses have agents in this country with 
 whom they have contracts that will not allow them to sell wines for shipment to 
 other parties in this country ? 
 
 A. That is pretty generally so. Champagne wine, in ninety-nine cases out 
 of a hundred, is shipped to this country on account of manufacture in France. 
 
 By Mr. Broomall : 
 
 Q. Your estimate of the amount of seizures, pursuant to your information, 
 would be in the neighborhood of $650,000, according to my figures. From 
 your knowledge of the business and of those cases, what proportion of that 
 would be equal to the actual fraud on the government ? 
 
 A. The rates of duty upon merchandise differ materially, and the rate of 
 fraudulent undervaluation was different, so that the estimate, in reply, would 
 necessarily be a vague one. The actual loss to the government would be a loss 
 in duties. The duty on* wines ? s about one hundred per cent, on the average. 
 It would be difficult to do it; it would involve a long calculation. The duty, 
 probably, on that amount would be, say, $650,000. I do not believe, if entries 
 had been made, the government would have got one-half of the money. I have 
 always considered, and I believe it is the policy of the government, that the 
 amount of money collected on the article by seizure bears a small proportion to 
 the amount saved indirectly by the effect of the vigilance exercised over these 
 people ; and the effect of punishment, which I know and could demonstrate, to 
 an enormous figure from the facts. 
 
 Q. Do you know what cases have been compromised which arose out of 
 information you gave to the government? 
 
 A. I have evidence in one instance that the case was compromised. 
 
 Q. What was the amount of seizure? 
 
 A. I think there was only a nominal seizure and a nominal trial. 
 Q. What was the amount ? 
 
 A. I have only seen it in the hands of Mr. Edwards in the Treasury Depart- 
 ment. 
 
 By Mr. Warner : 
 Q. You say only a nominal seizure ? 
 
 A. My information related to a considerable number of invoices upon which 
 I estimate the duty due to the government would be something about half a 
 million of dollars. The real seizure was six cases of merchandise. 
 
 By Mr. Broomall : 
 
 Q. Can you name the other cases which have been settled ? 
 
 A. I have not obtained knowledge of any other settlements. Those things 
 are not stated to me. It is considered beyond the purview of my powers — 
 what they do here. 
 
 Q. There are two modes, I understand, by which these settlements are 
 made ? 
 
 A. I think there is only one way in which a case can be settled. The Sec- 
 retary of the Treasury only has power to settle it. 
 
 Q. I understand one way is by actual compromise, without suit, by direction 
 of the Secretary of the Treasury, and the other is by amicable entry of suit, 
 and judgment entered in favor of the United States by the counsel as if upon 
 the trial. In this latter class of cases, is the Secretary always consulted, as 
 far as you know ? 
 
192 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. lie seems in the particular ca.se referred to not to have been; and he has 
 arrested the proceeding, It is the subject of inquiry a # t the department, his 
 attention having been called to it by me. m 
 
 Q. Is there any way in which it can be ascertained, from the record in the 
 latter class of cases, whether judgment was in consequence of an actual trial 
 in court or an entry by agreement on the part of counsel as if upon trial I 
 
 A. The office 01 the district attorney should show that. I think the record 
 of the COOrt would show whether there was an amicable trial or a real settle- 
 ment. That was plain upon the record which I saw. 
 
 Q. Are there not cases of settlement in which the jury is called and instructed 
 to find a verdict for a certain amount, by consent of counsel ? 
 
 A. I have never heard of such a case. 
 
 Q. Is not that the usual way ? 
 
 A. If that is the case, then there would be no way of ascertaining from the 
 record of the court. Jt could then only be ascertained from the district attor- ' 
 ney. 
 
 Q. According to the practice of the department, has the Secretary of the 
 Treasury any check over the officer of the government in this last class of 
 
 cases whatever? 
 
 A. I should think not. If the custom officers, meaning the collector, naval 
 officer, and surveyor, were disposed to consummate a so-called settlement of that 
 kind, and the district attorney was willing, I do not see but it would be taken 
 out of the reach of the Secretary of tlx; Treasury. But J think it would be 
 their duty to make a record ; though whether that record would enlighten him 
 or not I do not know. 
 
 Q. Until when ? 
 
 A. Until I called the attention of the department to it. 
 By Mr. Rollins : 
 
 Q. Did you have correspondence with the champagne house of G. H. Munn 
 & Co. ? 
 
 A. I think so. 
 
 Q. What was the nature of that correspondence ? 
 
 A. I cannot recoliect, but it must have been with respect to the value of 
 their wines. 
 
 Q. What information did you obtain from them 1 
 A. My impression is, their letter in reply contained no information. 
 Q. What reason did they give for not imparting information ? 
 A. That I have forgotten. It was several years ago, and I cannot remem- 
 ber. 
 
 Q. Does not that house send large quantities to this country ? 
 
 A. It is a house which has been seized, and against which there is legal, 
 positive evidence of fraud. My impression is, the evidence against them is con- 
 clusive as against any other. 
 
 Q. How did you obtain it ? 
 
 A. My impression is that part of Leuchtenrath's evidence is in that case. There 
 was a price current procured, I think, by Mr. Far well, which would be admis- 
 sible under the ruling of the court in California. 
 
 Q. What did you represent yourself to be in the correspondence with them 1 
 
 A. I do not think I made any representation as to who I was. 
 
 Q. What excuse did you render for desiring to purchase any wine % 
 
 A. I do not recollect that I said I wished to purchase any. My impression 
 is that I addressed them to ascertain their price. 
 
 Q. In order to ascertain their price, would it not be necessary to make some 
 proposal to purchase % 
 
 A. I do not know ; it may have been. I brought several letter-books with 
 
NEW \OHK CUSTOM-HOUSE. 
 
 193 
 
 rue. The whole number of my letter-books is so great that I confine myself to 
 but a few, and I have no letter-book so far back, or I could tell you precisely. 
 
 Q. Of whom did Leuchtenrath inquire in Paris as to the price of wine 1 
 
 A. Of the agents there. Nearly all the houses have public agents there, who 
 give the price generally in a printed list. 
 
 Q. Is wine shipped to a considerable extent from Paris ? 
 
 A. Xo, sir; generally the houses make their arrangements to ship from Reims. 
 
 Q. Are there any agencies in Paris for the shipment of wine to this country 
 at all ? 
 
 A. Under the French law they could not, because when the wine entered the 
 city it would have to pay the octroi duty, which is very heavy. The agents of 
 the houses always give you the price of the wine to be shipped at Reims. 
 
 Q. Would not any house in Reims furnish to an agent in New York, with 
 whom they had a contract of so large a character as to embrace the whole 
 country, wine at a much reduced price from that which they would furnish to an 
 isolated party 1 
 
 A. It is likely they would, but the difference would hardly come up to ten 
 per cent. My impression is that the difference would be from five to ten per 
 cent. We have tested that; but the undervaluation in these cases is from 100 
 to 120. In the case of Mnnn &: Co., my impression is in the neighborhood 
 of 100. 
 
 Q. What further statement have you to make ? 
 
 A. Some matters Mr. Rollins suggested called my attention to them, about 
 which I ought to have said more. One suggestion fell from him, why the trials 
 did not proceed. In the cases where I have had anything to do, the delay has 
 arisen from the fact that in taking the defendant's testimony it has always 
 been enormously prolonged, and we have never been able to force them to trial. 
 But we never failed to hear complaints when they got through, if we were be- 
 hind-hand. We are ready to try any of the cases; but from the fact that the 
 witnesses are the same in all of them, and we have cases to try in three cities, 
 viz., New York, New Orleans, and San Francisco, the order of the department 
 is that there shall be no cessation until the cases shall have been tried. 
 
 Washington, D. C, January 1G, 1S67. 
 Mr. MONTGOMERY GIBBS appeared, and his examination was continued 
 as follows : 
 
 It did not occur to me when Mr. Rollin's questions as to my cash receipts 
 were put that he might have asked them for the purpose of eliciting the fact 
 Avhether I had, or had not, received, at any time, any money or thing illegiti- 
 mately, outside my regular and legal salary and emoluments. I desire to state 
 that, beyond my salary and expenses, and the fees in the wine cases to which I 
 testified, I have received no money or thing of value, directly or indirectly, since 
 my appointment. There was never any arrangement, agreement, or under- 
 standing expressed or implied between myself or any other person by which I 
 was or am to receive any money or thing for doing or abstaining from any 
 official or other act, or by which I was or am to be in any way benefited, ex- 
 cept such agreement^ as related or relates to my salary and the counsel fees 
 above testified to. I have constantly abstained from any conversation with 
 importers or other persons interested in or connected with shipments as to their 
 shipments. Except in two cases, in both 'of which I desired Mr. Farwell to be 
 present, and he was present, I have never conversed with any person or per- 
 sons suspected of undervaluing goods or otherwise defrauding the revenue. In 
 the two cases he was present, at my request, during the interviews. I never 
 II. Rep. Com. 30 13 
 
194 
 
 NEW YOKK CUSTOMtJIOUSK. 
 
 Baw any of the parties before or after the interviews. The interviews resulted 
 in substantial admissions that both parties undervalued their gloves. I have 
 been, on many occasions, invited to dine with and to meet Socially importers 
 whose invoices 1 suspected were undervalued, but I have in no instance done 
 so, and have always abstained from any intercourse with them. I have never, 
 in any case, refrained from reporting an undervaluation as soon as I discovered 
 it, and I refer to my correspondence with the Treasury Department as a proof 
 that I have shown neither fear nor favor in my recommendations of advances or 
 of seizures. As to my plans for the prevention and punishment of frauds upon 
 the revenue I desire to state, that in the wine eases I w;is Bure that the frauds 
 were, what they were afterwards shown to be, very great. The government had 
 lost millions by the wine importers, and I thought any remedy which should 
 prove speedy and effective could hardly be too severe. In the champagne cases 
 parties under my direction did write to the manufacturers, asking for their true 
 market piices for large quantities. 1 have no donbt the manufacturers expected 
 to sell wines to these correspondents. They told the truth about their prices, 
 and the statements in their letters, compared with their .-worn statements, on the 
 strength of which their wines Were admitted to entry, convicted nearly the 
 whole trade of gross frauds upon the revenue. If my agents had Btated in ad- 
 vance what was the object of their inquiries, of course, the truth would not have 
 been told to them, and the United States would have continued to lose the half 
 million of duties each year which it had lost for years before my arrival in Eu- 
 rope, in 1863. Since the wine cases have been tried, the parties punished, and 
 the evil effectually cured, I have never Bought information as to the market value 
 of merchandise from shippers themselves. 1 have directed my inquiries, and my 
 agents have been required to direct theirs, to the open market, and i have avoided 
 placing any actual shipper to the United States under inquiry. It is easy to 
 ascertain the market value of any man's goods by inquiry of persons other than 
 himself, and such is my course. I have for two years carefully avoided placing 
 the service in a position to be censured in this regard. I have, as far as possible, 
 deprived the service of any detective character. It is easy to effect the object 
 for which the agencies were established without giving just cause for complaint. 
 My colleague, Mr. Farwell, has not acted. I believe, in accordance with these 
 views, but he has acted quite independently of me, and has not even consulted 
 me as to any of his plans or arrangements. It is so well understood by im- 
 porters contemplating frauds that their transactions are subject to the scrutiny 
 of experienced officials at the places where their goods are produced that it daily 
 becomes less necessary to push inquiries as they were pushed at the beginning. 
 The chances of the successful commission of frauds by undervaluation are greatly 
 less than they were three years ago, aud I have it in my power to show that 
 the percentage of increase in the invoiced value of most products paying ad 
 valorem duties is very great since 1S63. The aggregate saving of duties, as 
 the direct result of the measures taken under the act of March 3, 1S63, in rela- 
 tion to frauds upon the revenue, has been estimated at ten millions of dollars 
 per annum. I think the estimate correct. 
 
 As to the appraisers' department at our custom-houses, I desire to state this : 
 The duties upon all foreign merchandise are levied upon the actual market 
 value at the time and place of shipment. To correctly assess the duty, the 
 appraisers must of course possess reliable information as to what that market 
 value is. I never knew any of these gentlemen who had visited for this pur- 
 pose any of the markets abroad. I never knew that they had any means of 
 ascertaining the real market price in the foreign market, except by comparison 
 of the invoices of different importers of the same goods. If six importers, ship- 
 ping goods from the same place, invoice at the same prices, all the invoices 
 would, I believe, be passed as correct. It is only necessary for the six to col- 
 lude, to undervalue successfully. The evidence of such collusion is in many 
 
NEW YORK CUSTOM-HOUSE. 
 
 195 
 
 cases very conclusive. I recall one case, in which a shipper of gloves, who in 
 effect admitted that his gloves were systematically undervalued, boasted that 
 he had frequently been called upon to appraise gloves at the New York custom- 
 house. He stated to me correctly, from recollection, the invoice prices of all 
 the leading shippers of gloves. 1 have legal evidence to show that other par- 
 ties, who have been called as merchant appraisers of gloves, have been and are 
 guilty of frauds. As the appraisers' offices are now organized, I hardly see 
 how they get so near to the real market values as they do. 
 
 When the revenue agency abroad was established, it was the intention of the 
 Secretary of the Treasury that the agent, being present in the foreign market, 
 having the inspection of the invoices, and being in a position to ascertain the 
 true values, should be, in effect, an appraiser abroad. It was to have been one 
 of his duties to furnish such information as the home appraisers should lack and 
 send to him for. I have forwarded a great mass of information, but none of it 
 was ever applied for by the appraisers, that I recollect. There was never that 
 exchange between the appraisers and the agent which was contemplated, and 
 which would have enabled the government to effectually check the enormous 
 frauds known to exist. Instead of co-operating with the revenue agent, the 
 appraisers at New York once addressed a letter to Secretary Chase, in which, 
 referring to my agency, they protested against " the transfer of the appraisers' 
 department to Europe." 
 
 The effect of intelligent co-operation between the appraisers and the agent 
 abroad would be the almost entire suppression of frauds by undervaluation. 
 If forced to act without this co-operation, the effect of the labors of an intelli- 
 gent and faithful agent would be to show that the appraisers were either incom- 
 petent or corrupt ; for his reports would go to the department, and, if relied 
 upon, would lead,-'as they have done in many cases, to the seizure and subse- 
 quent condemnation of goods which the appraisers had passed as correctly 
 valued. 
 
 What I stated in my printed letter of January, 1S62, (which is made part of 
 my evidence,) of the value of the services of agents in foreign countries, I desire 
 to repeat. I think the value of the services already rendered cannot be over- 
 estimated. The moral effect of the presence in the principal markets of an 
 agent cognizant of sales and shipments, and prepared to report frauds, would be 
 worth to the revenue a hundred times the cost of the agency, even if no seizures 
 were actuallv made. If he was active, and had the co-operation of the appraisers, 
 the whole system of fraudulent undervaluation would be speedily broken up. 
 
 There should be at least three agents in Europe, men of intelligence, familiar 
 with the various European languages. They should be paid salaries adequate 
 at least to their decent support. The present salary is entirely inadequate. 
 They should be employed with the understanding that they are to have, as 
 matter of right, no interest in any seizure growing out of information given by 
 them. For my own part, if I were to continue in the service, I would greatly 
 prefer a proper salary, under such a proviso, to the present arrangement, which 
 leaves the agent to inform or not as he pleases. I have so stated to the Secre- 
 tary of the Treasury. In regard to the existing method of distributing the 
 proceeds of forfeitures as inequitable, the collector, naval officer, and surveyor, 
 who may render little or no service, receive the one-half of the proceeds of 
 seizure. I have little doubt that if one-fourth the amount, instead of one-half, 
 was fairly distributed to the persons who render meritorious services in the de- 
 tection and punishment of the fraud by the judges who try the cases, or in some 
 other proper manner, frauds would be even more promptly punished than now. 
 I think it would be very easy to demonstrate that in 1859, when I first com- 
 menced to give my attention to the subject of frauds upon the customs revenue, 
 the government was not collecting, and for years had not collected, more than 
 two-thirds of its legal revenue. In this opinion customs officers of experience 
 
t 
 
 19G HEW TORE CUSTOM-] Mrs k. 
 
 and intelligence concurred. Xo legitimate; commerce was more safe from inter' 
 ruption in those days than the fraudulent entry of ad valorem goods. In the 
 Hen irk case more than four hundred false invoices were passed by one house. 
 Half of them wen- mere forgeries, and the fraud was patent almost on the face 
 of the invoices. Vet there w as no trouble between Herrick and the government 
 officials until the frauds were detected by me nearly ten years alter their commis- 
 sion. The evidence of combination among importers to prevent disclosures of 
 fraud was very conclusive in that case. Such combinations exist in gn aier 
 force to-day. I believe thai the percentage of undervaluation is greatly dimin- 
 ished since 1SG3 ; but J am certain that if the matter could be reduced to 
 absolute proof it would be found that the tax-payers of the United States arc 
 yearly called upon to supply twenty millions of dollar- fraudulently taken from 
 the customs revenue. This enormous sum goes into the pockets of foreigners, 
 in most instance- into the pockets of men who do not reside in the United States. 
 It must be obvious to any one who will reflect for one moment on the subject 
 that the person or persons who seek to restore this sum to its lawful owner 
 must necessarily array against himself powerful interests. Such interests are 
 now at work. 
 
 13y Mr. Bboomall : 
 
 Q. Vou have spoken of the duties of appraisers ; are they limited to the par- 
 ticular package selected by the officer of the government out of the entire 
 invoice ? 
 
 A. They have an officer who sometimes, I do not know to what extent, visits 
 the place of business of merchants, but I think the appraisement is made upon 
 the package sent to the office. 
 
 Q. What officer in New York makes the selection of packages to be ap- 
 praised ? 
 
 A. One of the deputy collectors. 
 
 Q. Give us his name. 
 
 A. I believe that for four years Mr. M-udgctt has been the principal deputy in 
 that department. 
 
 Q. State what proportion of the packages of the invoice is selected. 
 A. I believe the rule is one in ten. 
 
 Q. Is there any particular mode, or is it done entirely at the option aud dis- 
 cretion of the officer ? 
 
 A. I understand it is done entirely at the discretion of the officer. 
 
 Q. Is there any check that you know of upon that officer to prevent collusion 
 between him and the importer as to the selections for appraisement ? 
 
 A. I know of none. 
 
 By Mr. Rollins : 
 
 Q. Did I understand you to say you came from Europe in response to a 
 telegram ? 
 A. Yes, sir. 
 
 Q. Who sent the telegram? 
 
 A. The Secretary of the Treasury. 
 
 Q. Was any reason assigned for your recall at that time ? 
 A. None. The despatch contained six words only, " Come to Washington 
 by next steamer." 
 Q . Where were you ? 
 A. At Paris. 
 
 Q. Had you been to England just prior to the reception of that telegram ? 
 
 A. I think I left on the 12th of November. 
 
 Q. What business had you been engaged in in England ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 197 
 
 A. Among other things I had been with Mr. Morse to Liverpool in the matter 
 of the settlement of the confederate claims. 
 Q. What claims? 
 
 A. The claims of the United States for confederate property. 
 Q. Give ns the names of the parties holding it. 
 
 A. There were several. The principal party was Eraser, Trenholm & Co. 
 Q. Did you come from Paris to Liverpool for the purpose of adjusting that 
 claim ? 
 
 A. I went from Paris to London in consequence of a despatch or despatches 
 from Mr. Morse, onr consul at London. On arriving at Liverpool I understood he 
 wanted my assistance in that matter, and then I went with him from London to 
 Liverpool. 
 
 Q. What authority did you have from the Treasury Department to act in that 
 case ? 
 
 A. None, whatever; nor did I propose to take any action beyond aiding Mr. 
 Morse by my advice. 
 
 Q. When did you receive any information from Mr. Morse that your assistance 
 was needed in that case ? 
 
 A. On my arrival at London I first ascertained what he wanted. 
 
 Q. Had you any correspondence with him prior to that ? 
 
 A. I had conversations frequently with him when I was at the consulate at 
 London, which consulate I frequently visited. 
 
 Q. What was the nature of these conversations ? 
 
 A. They generally related to the efforts Mr. Morse was making to discover 
 confederate property, a large amount of which he believed was concealed and 
 held by various rebel confederate agents in various parts of Europe. 
 
 Q. What was the amount of these claims of the government against Eraser, 
 Trenholm & Co. ? 
 
 A. I do not believe any one knew what was the amount of the claim. Era- 
 ser, Trenholm & Co. were suspected of having in their hands a large amount 
 of property which, at the close of the war, would become the property of the 
 United States. What that amount is, is still unknown. 
 
 Q. What steps did you take to ascertain what the amount was? 
 
 A. I never took any steps ; but I understood Mr. Morse had taken steps b y 
 inquiry, to ascertain the amount. 
 
 Q. How much did he say the claim amounted to ? 
 
 A. I do not think he stated. 
 
 Q. Did you ever hear any statement of the sum ? 
 
 A. Never, until after the settlement. 
 
 Q. Who made the settlement? 
 
 A. Mr. Morse, under express authority from the Treasury Department. 
 Q. You had nothing to do with it? 
 
 A. I was present when the settlement was made, and Mr. Hull, who repre- 
 sented Eraser, Trenholm & Co., desired very much that I would sign the memo- 
 randum of the agreement of settlement. It was explained, as it had been before. 
 I had no authority relating to that matter, and I preferred not to sign; but Mr. 
 Morse urged me to do so, with the understanding that I did not si-n by virtue 
 of any authority to make the settlement. 
 
 Q. Have we a consul at Liverpool ? 
 
 A. Yes, sir. 
 
 Q. Who? 
 
 A. Mr. James H. Dudley. 
 
 Q. Was he present at Liverpool ? 
 
 A. He was at Paris. 
 
 Q, At what point is Mr. Morse consul? 
 
198 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. London. Mr. Dudley went to Paris, and was absent during the settle- 
 ment. 
 
 Q. Were you aware Mr. Dudley was absent from Liverpool when you and 
 Mr. Morse went there to adjust this matter of Fraser, Trenholm cV Co. ? 
 A. I was. 
 
 Q. Did you and Mr. Morse consult Mr. Dudley in reference t<> the adjustment 
 of this matter? 
 A. No, sir. 
 
 Q. How much was to be paid, and on what terms was the adjustment made' 
 A. It was a written adjustment, and I can furnish the committee with a copy 
 of it. I think I can state the terms. They were these: Fraser, Trenholm & 
 Co. were to give up to the United States all the property which they had under 
 their control of the 1 ite ( 'onfederate States, so called. A lien upon the property, 
 or liens, for moneys furnished in building ships and other things, legal liens, 
 which it was stated amounted to 1201,000, were to be reduced to £150,000; 
 aud on transfer of the whole property to the United States these liens, to the 
 extent of the .€150,000, were to be deducted from the proceed-. 
 
 Q. In other words, they wen.' to deliver the pi' -pertv, and \ou were to pay 
 £150,000? • 
 
 A. The property was to be sold by the parties jointly for the benefit of the 
 United States, and out of the proceeds of the property the legal lien, to the 
 extent of ,£150,000, was to be allowed, and the books and papers of Fraser, 
 Trenholm & Co. were to be subjected to the inspection of the agents of the 
 United States; and, by supplemental arrangement made at the sain? time, a 
 statement of the property, its whereabouts, condition, and all other particulars, 
 was to be made under oath, subject to verification by examination of the papers, 
 books, &e. That sworn inventory was afterwards made, and I inspected the 
 books of Fraser, Trenholm & Co., and took copies of some of the accounts. 
 That is all which relates to the agreement. 
 
 "Q. Have you any idea of the value of this property now in their hands 
 which was to be delivered up? 
 
 A. I made an estimate the other day for Caleb Gushing, to whom the adjust- 
 ment of the matter has been left by the Treasury and State Uepartments. I 
 made an estimate from my recollection, having none of the papers in the case, 
 giving the items as I then recalled them. I stated that I believed the property 
 at its cost price was about .£400,000, though I do uot recollect distinctly the 
 figures. If I saw the memorandum I could tell. It was about c£400,000. I 
 recollect, in discussing the matter with General Cushiug, we agreed that the 
 amount due to the United States, after the cancellation of their lien, would be 
 more than ^£100,000, according to their values; that is, the property of Fraser, 
 Trenholm & Co. only. 
 
 Q. AVas no consultation had with Mr. Adams in reference to the adjustment 
 of this case? 
 
 A. Mr. Adams was at that time on the continent, and for some time after- 
 wards. 
 
 Q. Was any consultation had with him? 
 
 A. I do not think his whereabouts was known ; at least not to me. Mr. 
 Morse stated to me, and, I have no doubt, believed that his power was full 
 enough, and intended to be full enough, to give him the right of settlement 
 without, regard to any person but the minister. There was, at the foot of the 
 letter which he cites as his power, a suggestion that he should consult the min- 
 ister. 
 
 Q. Which he did not do 1 
 
 A. Which he did not do, owing to his absence from the country. 
 
 Q. Had he any special instructions in reference to this case? 
 
 A. I never saw any but his letter from the Secretary of the Treasury. 
 
NEW YORK CUSTOM-HOUSE 
 
 199 
 
 Q. Did you have any ? 
 A. None whatever. 
 Q. Still you signed? 
 
 A. Yes, sir; under the circumstances which I related. It has been made the 
 matter of full and careful explanation at the two departments — between myself 
 and the representatives of the State and Treasury Departments. 
 
 Q. The settlement was disavowed ? 
 
 A. It was at first ; but my understanding is, it is to be carried out. 
 Q. Has not counsel been sent abroad ? 
 
 A. It is more proper to say that Judge Redfield has been left to take charge 
 of the whole matter of confederate property with power to adjust the whole sub- 
 ject, and, I understand, at the request and suggestion of both consuls, Mr. Morse 
 and Mr. Dudley. There was a large amount of confederate property outside of 
 Fraser, Trenholm &: Co. when the settlement was arrested. It is in respect to 
 that, as well as to Fraser, Trenholm & Co., that Judge Redfield has gone, I 
 understand. 
 
 Q. Was not a telegram sent to oar minister to stop the adjustment? 
 A. I understand a telegram was. 
 
 Q. And disavowed the action which had been had by yourself and Mr. 
 Morse ? 
 
 A. I have heard something to that effect. At any rate, some telegram was 
 sent which stopped all proceedings of every kind. 
 
 Q. Did you go there in response to a letter or telegram of Mr. Morse ? 
 
 A. I first went to London without knowing why he desired my presence 
 there. He did not indicate any in his telegram. 
 
 Q. Had not there been some conversation or correspondence between the 
 consul at London and yourself that led you to suspect at least what your 
 business was' to be ? 
 
 A. We had for months frequently conversed in reference to the question of 
 the recovery of confederate property abroad. 1 had frequently, while doing 
 business in the consulate, heard confedeiates claiming to have knowledge of 
 confederate property, and other people, conversing with Mr. Morse about it. It 
 attracted a good deal of attention, but I had no conversation with Mr. Morse 
 about it. I think, however, that on one or two occasions he had alluded to the 
 subject in letters to me, and in one or two asked my advice about the propriety 
 of the steps taken to recover the property. On the receipt of this telegram 
 nothing was said about the business which called me there. 
 
 Q. Had not the correspondence and conversation you had with him prior to 
 that led you to suspect, when the telegram was received, the object for which 
 he desired your presence? 
 
 A. It was one of the things I thought of. 
 
 Q. He intimated to you or told you he should at some time want your aid 
 in the adjustment of this matter, prior to the receipt of this telegram ? 
 A. He did not say he would at some future time want my aid. 
 Q, What did he say about having your service ? 
 
 A. He said, on a good many occasions, not being himself a lawyer, and 
 knowing I was not only a lawyer, but an agent of the government, that he 
 would be glad to avail himself of my advice in respect to the expediency, pro- 
 priety, and legality of measures which he was instructed to take, under his au- 
 thority, for the recovery of this property; to which I always replied, 1 would 
 render any aid in my power. 
 
 Q. Was not Mr. Adams a lawyer ? 
 
 A. I do not know whether Mr. Adams is a lawyer or not. I believe he has 
 been a lawyer. It never occurred to me before to inquire. I had understood 
 from Mr. Morse that Mr. Adams preferred not to have anything to do with the 
 pursuit of confederate property ; and on my return from Liverpool I stated to 
 
200 
 
 NKW YORK CUSTOM-IIOU8K. 
 
 the charge d'affaires, Mr. Moran, then in charge of the legation, what bad I eer 
 done, and suggested that he inform the State Department of tlx- settlement. He- 
 replied that Mr. Adams had always declined to have anything to do with this 
 matter of confederate property, and he would make; no report on the lubjecd : 
 he presumed Mr. Adams wonld decline to have anything to do with i:. I never 
 
 had any conversation with Mr. Adams about it. My understanding that .Air. 
 Adams preferred t<> have nothing to do with it was from Mr. Horse. 
 
 Q. Had Mr. Dudley declined having anything to do with it? 
 
 A. Not that I know of. 1 suppose not. 
 n. From what State is Mr. Dudley I 
 
 A. From Camden, New Jersey. I think it to be due to Mr. Morse tn say< 
 inasmuch as the subject has come u j> in this committee, that these powers of his 
 should be put upon record. I have copies which 1 know to be true copied 
 which I would, as a matter of explanation, leave with the committee. I should 
 like to statu further, in his interest, inasmuch as he is absent and cannot speak 
 for himself, that his motive for hastening the settlement with Fraser, Trenholm 
 & Co. I knew to be, the fact that on the 0th or 7th day of November be was 
 required, under order of Mr. .Justice Lu&hiagton, to tile security in certain case- 
 which he had commenced, to recover property from Fraser, Trenholm & Co., 
 in the sum of l'7.'J,000 sterling, which security he was not prepared to famish. 
 I advised him, in respect to those cases, that the legal proof to recover the prop- 
 erty was defective; that by all means the cases should be discontinued. They 
 were commenced on legal grounds, but the testimony on which he relied had 
 failed, in a measure. Another motive for haste in the matter was tin- appear- 
 ance, a few days before, in London, of a man named Brashear, who presented a 
 contract made between himself and the Treasury Department, by which Mr. 
 Brashear was to receive compensation not exceeding fifty per cent, out of any 
 property which he might secure the recovery of. Mr. Morse said these gentle- 
 men had made certain propositions to him which seemed improper, and tearing 
 he might get hold of the property which was then in process of being reduced 
 to possession, he desired to put himself, by means of a settlement with Fraser, 
 Trenholm & Co., in a position to reduce to possession the confederate property 
 in Europe, which he believed he could do, and which I believed he could do, if 
 Fraser, Trenholm & Co. were once settled with. The facts sustained this po- 
 sition, and at the time the settlement was arrested nine-tenths of the confederate- 
 property in Europe was in shape to be speedily reduced to the possession of 
 the United States, and very much of the confederate property in Europe which 
 was disclosed under the statement indicated, was property the existence of 
 which had never been suspected by any agent or officer of the government. I 
 have stated to the Secretary of the Treasury, and I desire to state, to the com- 
 mittee, that the settlement with Fraser, Trenholm & Co., and all settlements 
 made in consequence of it with the parties who refused to appear and disclose 
 until after that settlement should be completed, were very advantageous to the 
 government in a pecuniary point of view. And I believe that, had not the settle- 
 ment made interfered with certain diplomatic questions which Mr. Seward has 
 raised with the British government, the settlement would have been considered 
 by all parties most advantageous to the government. 
 
 Another motive for hastening the settlement was that the. property consisted 
 of ships, several of which I saw were rapidly decaying, of guns and batteries, 
 which are depreciating rapidly, confederate uniforms, boots and shoes, ma- 
 chinery, and other things, the value of which, at the close of the chancellor's 
 suit, would be very little, if anything. The consideration which moved Mr. 
 Morse to the settlement was that he could reach by settlement more valuable 
 results than could be reached by a successful issue of all the lawsuits. I have 
 stated to the Secretary of the Treasury that I agreed in opinion with Mr. Morse 
 in that respect. 
 
NEW YORK CUSTOM-HOUSE. 201 
 
 Q. "When the adjustment of this case was of such vast consequence to the 
 government pecuniarily — so important as you would seem to indicate — why was 
 it, Mr. Dudley being consul at Liverpool, that Mr. Adams, our minister resi- 
 dent there, was not consulted ? 
 
 A. When the negotiation was about to open at Liverpool, Mr. Morse and I 
 both stated, as to any matter in which Mr. Dudley had commenced suits, that 
 it was proper Mr. Dudley should be consulted. Mr. Prioleau, the attorney , 
 Hall, who acted for him, Mr. La Force, all stated that they would not negotiate 
 directly with Mr. Dudley. They gave many reasons, which I do not deem it 
 proper or just to repeat, why Mr. Dudley should not be consulted ; but that, 
 afterwards, he should have the fullest opportunity to examine the books, and to 
 criticise the settlement, was insisted upon by both Mr. Morse and myself. I 
 understand none of these parties have any social relations with Mr. Dudley, or 
 lie with them. They stated repeatedly their unwillingness to meet him person- 
 ally. As to Mr. Adams, he was upon the continent ; I do not think Mr. Morse 
 knew at what place, or when he would return. But the fact of his indisposi- 
 tion and disinclination to interfere with the pursuit of confederate property was 
 mentioned to me by Mr. Morse on several occasions, and I understood that it 
 was his wish that he should not be consulted. 
 
 CONCERNING THE PREVIOUS CHARACTER AND STANDING OF MONT- 
 GOMERY GIBBS, UNITED STATES REVENUE AGENT IN EUROPE. 
 
 pi- •* -t '■' - '^n ■ ' 
 
 New York, January 17, 1867. 
 
 C. J. ROONEY sworn and examined. 
 
 By the Chairma.v : 
 Q. Where do you reside 1 
 A. In Hudson city, New Jersey. 
 Q. Are you acquainted with Montgomery Gibbs ? 
 A. I know him some ten or twelve years. 
 Q. Where did you first know him ? 
 
 A. In Trinity building, when I was with P. Douglas <fc Co. 
 Q. Do you know Mr. Montgomery Gibbs's handwriting ? 
 A. Yes. 
 
 Q. Here are two letters to the house of G. H. Merrum & Co., of Reims, 
 dajed ' l London, May 9, 1864," and the other, " London, May IS, 1864/' 
 signed M. Gibbs, care of F. R. Morse, 67 Grace Church street, London. 
 
 (Letters handed to witness.) 
 
 Do you know these letters % 
 
 A. Yes; these are Mr. Gibbs's handwriting; I know it perfectly well. 
 
 Q. Here are three letters to the house of Charles Heidsick & Co., Reims ; 
 one dated at Liverpool, April 26, 1S64, signed Amos Hill, care of Edwards'j 
 Hotel, George street, Hanover square, London ; one at London, May 8, 1864. 
 and signed Amos Hill, care of Freeman R. Morse, Esq., 67 Grace Church street, 
 London; and one dated Antwerp, December 7, 1867, signed Amos Hill, of 
 Aspinwall and Panama. 
 
 (Letters handed to witness. 
 
 Will you look at these and state to the committee whose handwriting they 
 are in 1 
 
 A. I am positive as to this being Mr. Gibbs's handwriting— that is the one 
 signed Amos Hill, Liverpool. The second one is also in his handwriting ; 
 that is the London one, to be answered, directed to the care of the consul. I 
 would also say that this one, dated at Antwerp, is also his, but I am not so 
 I certain of it as I am of the others. 
 
NEW YORK CUSTOM-HOUSE 
 
 Q. How do you know this ? 
 
 A. I know there are certain characteristics of hifl letters ; their format ion it 
 very peculiar. 
 
 ( v >. From your knowledge of .Air. (Jibbs, w hat is your impression of liitu ? 
 
 A. From my acquaintance with him I should say I would not trust him with 
 a sixpence. I would not have the slightest confidence in him. 
 
 Q. That is the result of your twelve years' ac<|U uutance ( 
 
 A. Yes. The firm with which he was connected tailed on the 1-t of Febru- 
 ary, 1SG3. 
 
 < v >. They wen- doing business in this eit? then I 
 A. Yes. 
 
 Ni.w Y(u:k, January 17, 1SG7. 
 
 JAMES HERON sworn and examined. 
 
 By the Chairman : 
 Q. Are you' connected with the custom-house \ 
 A. I am an inspector. 
 
 Q. How long have you been an inspector ? 
 A. Since 1861. 
 
 Q. Was it your duty to examine the l>aggago of passengers coming from for- 
 eign countries ? 
 
 A. Yes ; in company with others. 
 
 Q. Is it a fact that baggage is frequently passed without being examined ac- 
 cording to the strict letter of the law \ 
 A. Never by me. 
 
 Q. Do you know if such is a fact \ 
 
 A. I have seen baggage checked that never was opened, but not by an in- 
 spector, but by a superior officer. 
 
 Q. By whom, or by whose authority, has baggage been passed ? 
 A. I can hardly say, as I have not to do it myself. 
 
 Q. Is it not a fact that written orders are sometimes given by th\> surveyor 
 and collector or naval officer to do so ? 
 
 A. I have never had anything of the kind. 
 
 Q. Have you any personal knowledge that such is the fact ? 
 
 A. No. 
 
 Q. You have never passed baggage yourself? 
 
 A. Xo ; nor had I a written order from the surveyor or naval officer to do so. 
 Q. Have you ever been directed verbally by your superior officers to pass 
 baggage 1 
 
 A. Never, without being examined. 
 
 Q. Have you passed baggage without making a very close examination ? 
 
 A. Yes ; 1 was told not to be very particular when the person was a friend 
 of the collector's, or of some other person. 
 
 Q. Do you know any abuses generally, which ought to be corrected, in your 
 department ? 
 
 A. There are a great many which I suppose might be corrected. For in- 
 stance, when new men are appointed now, they get a ship to discharge right 
 off. I was nearly two years before I got a steamer. Now a new man comes 
 in and gets a steamer the next day, although he knows no more about the duty 
 than a boy does. 
 
 Q. Then you regard being assigned to a steamer a better position thau ordi- 
 nary ? 
 
 A. I do not; I would rather have a sailing ship. 
 
NEW YORK CUSTOM-HOUSE. 
 
 203 
 
 Q. Then what do you mean by saying a new man is assigned to a steamer? 
 A. We take the steamers in rotation, and a new man is assigned to a steamer 
 if she comes up in his turn. 
 
 New York, January 18, 1S67. 
 
 HENRY LEVY sworn and examined. 
 
 By the Chairman : 
 Q. Are you in business here ? 
 A. I am, in the fancy business. 
 Q. Do you know Montgomery Gibbs I , 
 A. I do. 
 
 Q. How long have you known him ? 
 
 A. I suppose seven or eight years. 
 
 Q. Did you know him when he was in this city 1 
 
 A. Yes ; when he kept a sort of banking-house at the corner of Fulton street 
 and Broadway, and finally at 202 Broadway. 
 
 Q. What was his reputation as a business man, or as a man of his word ? 
 
 A. As a business man, I always considered him a shrewd sort of fellow, a 
 pretty fast talker. As for his word, I can only say we suffered by him. We 
 gave him some collections to make, and have not got the proceeds yet. Whether 
 it was his fault or not I cannot say. His brothers were connected with him in 
 business, but they failed. He gave reasons for their failure. 
 
 Q. What reasons did he give ? 
 
 A. He said his clerks were dishonest, and got him into difficulties before he 
 was aware of it. 
 
 Q. What was the amount of the collections that he had of yours ? 
 A. I think some $600 or $700. 
 Q. What is his situation now 1 
 
 A. I have not seen him for some time. The last time I saw him was on a train 
 coming from AYashington to ibis city, about eighteen months ago. 
 Q What is his reputation generally ? 
 A. As far as my knowledge goes, it is weak. 
 
 Q. From your knowledge of him, would you employ him to transact business 
 for you, or to make a negotiation ? 
 A. I would not. 
 
 Q. From your experienej and knowledge of him ? 
 A. Yes. 
 
 Q. Do you know anything else of him ? 
 
 A. I have asked him about our business, and he has given me very fair 
 promises. And when T met him on the train coming from Washington, he said 
 he would call on me the next day. But I have not heard from him since. I 
 heard lately he was in France on a government mission. 
 
 New York, January 18, 1SG7. 
 FREDERICK HOOSE sworn and examined. 
 
 By the Chairman : 
 Q. Are you in business in this city ? 
 A. I am. I am an importer of hosiery. 
 Q. Do you know Montgomery Gibbs? 
 A. I do. 
 
204 
 
 NEW YORK (TST')M -HOUSE. 
 
 Q. How long) have you known him? 
 
 A. Perhaps six or eight year*. I bad no transactions with him, except that 
 I gave him some notes for collection. The first I gave him, when he collected 
 them, he paid me promptly : until a man named Thomas Nicholls failed, who 
 owed me 82,700. I gave Mr. Gibbs the papers to settle with him. 1 waited, 
 after giving them to him, for eight or nine months, and there was nothing done, 
 Ik cause he said he could not find him ; hut after some delay he did meet him. 
 After that I heard from some friends of mine, importers, that thev had received 
 twenty-live per cent, on account from Nicholls. I then went to sec Mr. (iibbs 
 again, and he said to me : "We cannot get that fellow vet, as the lawyer in 
 Newark, whom 1 have engaged, cannot £K him.' 1 I then waited four or five 
 months longer; and when I then went to his otHce, his chrk told me he had 
 gone to France. That is all I 'know of him since. But the twenty -five per 
 cent, on account Gibbs received from Nicholls for me, as his bonks showed, has 
 not been received by mi' from him. 
 
 Q. What is his reputation? 
 
 A. I know nothing else about him. 
 
 Nk\V YnllK, January IS, 1S67. 
 LUCIEN 13IRDSEYE sworn and examined. 
 
 By the Chairman : 
 Q. What is your occupation, and where do you reside I 
 
 A. I reside at OS West W r arren street, Brooklyn, and am engaged as a law- 
 yer, and I do business at 17 Broadway, in the city of New fork. I have been 
 a lawyer for twenty years, and have practiced here for about seven. 
 
 Q. Are you acquainted with Montgomery Gibbs, who has been abroad in the 
 government service ? 
 
 A. I have been acquainted with him. 
 
 Q. What is his standing ? 
 
 A. He is, pecuniarily, entirely irresponsible, unless he has made money since 
 he left the United States. I was associated with him in business, in a kind of 
 partnership, for some time, and became thoroughly acquainted with his character 
 at the time. 
 
 Q. What was his character then as a business man I Were his representations 
 reliable 1 
 
 A. I would like to know whether I am to answer that question upon my own 
 knowledge, or upon general reputation, or upon both \ 
 
 Q. State from your own knowledge, and also from general reputation. 
 
 A. Since I am desired by the committee to do so, I will. Since my connec- 
 tion with him, many people spoke to me in terms strongly condemning his 
 character. My own dealings with him were cxtren%ly unsatisfactory. He 
 asked me to go into business with him, and take charge of the litigatory 
 business, saying he never desired to go into court. I took charge of the litiga- 
 tory business of this firm, and conducted it for nearly two years, and in tbifl 
 way saw a good deal of him, and became very much dissatisfied with his con- 
 duct to myself. I also defended numerous suits in which he was concerned, 
 some of which were on account of moneys collected by him, and for which he was 
 alleged to be responsible. ( hie case, I think, related where he, as commissioner 
 for some State, had certified a deed as having been acknowledged before him. 
 and had dated back the certificate, so as to give it an appearance of being a 
 consideration for a promissory note of the same date. It was defended on the 
 ground that the latter had no title. I defended this and some other suits for 
 him, but before they Were tried he had left the country. His partner, Mr. Gr. 
 
NEW YORK CUSTOM-HOUSE. 
 
 205 
 
 C. Gibbs, was subsequently sued for money which had been collected by the 
 house and had not been paid over. E have been of the opinion that Mr. J. 0. 
 Gibbs was ar^lionest and upright man. I ought to say in regard to these mat- 
 ters, Mr. Gibbs claimed to have a defence, and that the facts, when investigated, 
 would exonerate him from the charge. 
 
 Q. From your knowledge of Montgomery Gibbs would you, in any sense, re- 
 gard him as a proper person to be in the employ of the United States govern- 
 ment abroad ? 
 
 A. I shall answer that question in this way : I would not suffer him to do 
 any business for me of any kind, with my personal knowledge of his dealings, 
 reputation, and his pecuniary standing. 
 
 Q. Were you retained in the Stursburger and Xuhn suit ? 
 
 A. I was. 
 
 Q. State the circumstances ? 
 
 A. I had known both the partners of that firm since my first residence in or 
 near the city of New York. I became acquainted with them in the year 1S50, 
 and had business dealings with them, doing more or less business for them since. 
 One of the partners generally resided in Europe and attended to their business 
 there, and the other resided here. Some time during the last year Mr. Sturs- 
 burger came to me and told me that he had received information from a custom- 
 house broker that his store was to be seized by the officers of the custom-house, 
 on the ground that he had been defrauding the government by untrue returns of 
 goods and undervaluation. He told me very honestly and frankly that there 
 was no ground for the charge. That he had been seized once before, and his 
 books kept from him for some time, putting him to a great deal of inconvenience ; 
 and that they had found nothing to implicate him. And he assured me the 
 facts were the same now. I advised him to submit everything about his store to 
 the custom-liouse officers, and assist them to make an investigation, if they 
 should come to his place. The day after he received the information his place 
 was seized by the deputy surveyor of the port, and his books were taken away 
 to be examined. His store, however, was not closed up. After an examina- 
 tion, which lasted two or three days, his books were returned to him, and no 
 charge, that I could learn, made against him ; on the contrary, I learned from 
 Mr. Franklin, and I am not sure but from Mr. Wakeman, that the books were 
 entirely correct. I claimed at once from the officers the name of the party who 
 had made the complaint, and I took proceedings to get it. I saw the officers of 
 the custom-bouse, and, ad nauseam, I pursued them with great diligence to find 
 out who it was, because it was an outrageous attack on a perfectly honorable 
 house, and I wanted to bring an action against whoever gave the information. 
 But I have never been able to obtain any information in regard to it. I was in- 
 structed by my client to spare no expense in order to find out the informer, and 
 I did everything, as a professional man, to get the information, but could not 
 get it. I learned only the name of the attorney who furnished the papers to 
 the custom-house. When the papers were in Mr. Oline's possession they 
 were laid on a table between him and me, and he was not aware that I saw the 
 attorney's name indorsed upon them. I told Mr. Cline I had seen it, and he 
 said I was correct. I never was at liberty to call on the attorney, and I have 
 not done so. 
 
 Q. Were you referred to Mr. Hanscome? 
 
 A. I was, I think. Subsequently to my having seen that name I had a con- 
 versation with him in reference to the fact that that attorney had made the com- 
 plaint, oi» had been the medium of presenting the complaint. I learned the 
 fact in reference to the complaint to be substantially this : That the evening 
 before the seizure was made, Mr. Stursburger was coming from the custom- 
 house ; and, at the corner of Pine street, a custom-house broker named Isaacs 
 accosted him, and said, " I have some information which will be of value to 
 
20G 
 
 NKW YORK CUSTOM-HOUSE. 
 
 you, and if I give it to you, you mast remember me and my friends. It will 
 be worth a great deal to you, and you can afford to pay us for it." So far aa I 
 recollect, these were the words. Mr Stursbnrger replied that he 4lf 1 not know 
 any information that would do him any good, and he was not disposed to pay 
 anything. Finally, Mr. Isaacs said he would tell him what the information was ; 
 and he told him his store would he seized next day, and he could he prepared 
 for it ; and if he had anything that he wanted to conceal he could remove it. 
 and conceal his hooks, and make ready for the investigation. Mr. Stursburger 
 said he had nothing to conceal, and the government could make the investiga- 
 tion when they wished. Next morning, from ten to eleven o'clock, Mr. Stars- 
 burger saw me on the subject ; and about noon Ins store waB seized by the CUS- 
 tom-honse officers. 
 
 Astor IIorsR, New York, February T, 1S67. 
 AUGUST SEELY, being duly .-worn, testifies as follows : 
 
 I reside in this city; I have been in the millinery business; am now in the 
 manufacturing business. 1 was in the hat and cap business. 
 
 By the Chairman : 
 
 C v ). Have vou any acquaintance with, or knowledge of, Montgomery Gibbl ? 
 
 A. Yes, sir; 1). 0. and M Gibbs. 
 
 Q. What do you know of their business? 
 
 A. I know more than 1 wished I did. 
 
 Q. What is his standing as a business man I 
 
 A. I always looked upon the firm as reliable. "We placed our notes with 
 them for collection ; the result was that they collected the money and did not 
 pay it over. I supposed.it was perfectly sate. I knew his brother George; it 
 was about 1863. 1 went over to their office on Broadway, and found that Mont- 
 gomery Gibbs was nan est. His brother George told me that he had gone to 
 Paris for the government. One of their head men was there also. They told 
 me they could not pay then ; that they had collected the money, but could not 
 pay the notes we had there for collection. I told him (George) that I would 
 like a settlement of the notes, and he gave it to me, and then they amounted 
 at that time to about 81,200. 
 
 Q. Did you get any portion of it ? 
 
 A. No, sir, never 
 
 Q. Did you come in contact with Montgomery Gibbs direct ? 
 A. I did the early part of the time, when I left the notes there. 
 Q. Have you ever, by letter or personally, made application to Montgomery 
 Gibbs for the return of any portion of this amount ? 
 A. Yes, sir, about ten days ago, in Washington. 
 Q. What did he say ? 
 
 A. He said it was all right, and he would pay, and wanted to see me further. 
 I met him first just after breakfast ; I did not have any time to talk with him 
 then. The next day I saw him at Willards' hotel, and I told him I wanted to 
 have some conversation regarding our old matters. I said " You are owing us 
 some money, and we want it." Gibbs said it was all right. Says he, " That 
 thing is working well ; I am in hopes of being able to pay you everything, and 
 think I shall." He said that he was sent abroad by the government, a^nd that 
 he sent home $1,300 ; that he had been doing all he could. He had no idea of 
 the condition of the concern ; that when he went away he left it well off, and he 
 supposed it was perfectly good ; that he had sent home the $1,300 to pay off 
 
SEW YORK CUSTOM-HOUSE. 
 
 207 
 
 these debts, <is far as it would go, and it bad been applied to small debts, to 
 people that needed it more than I did. 
 
 Q. Did you regard him as a reliable and trusty man for business transactions ? 
 
 A. I did regard him so up to that time ; I could not now. 
 
 Q. What is his general reputation in that respect ? 
 
 A. I think his reputation up to that time was good ; now I think it rather bad. 
 
 No. 10— B. 
 
 CONTINUATION OF W. B. FAR WELL'S TESTIMONY. 
 
 To the chairman and members of the Committee on Public Expenditures of the 
 House of Representatives of the United States : 
 
 Gentlemen : In response to the request of your chairman, I respectfnlly 
 submit the following report : 
 
 On the 27th day of December, 1S65, I was appointed by the Secretary of 
 the Treasury as revenue agent, and directed to report to, and receive my orders 
 from, the Solicitor of the Treasury. Under the instructions of that officer I 
 proceeded to San Francisco to assist in preparing for obtaining the necessary 
 evidence in suits pending there against a large number of invoices of red wines, 
 seized for violation of the revenue laws, to secure the condemnation and for- 
 feiture of the wines in question. I then proceeded to Europe, via Panama and 
 New York, landing at Queenstown, in Ireland, at the close of the month of 
 April last. My held of investigation of frauds upon the revenue from that time 
 up to the close of September embraced the manufacturing and producing dis- 
 tricts of northern Ireland, Scotland, Lancashire, and Birmingham, in England ; 
 the wine districts of France and Spain; the silk and ribbon districts of Swit- 
 zerland, as also the watch manufacturing section of the same country ; the 
 leather, cloth, wine, silk and woollen, porcelain, cVc, &c, districts of Saxony, 
 Prussia, and Belgium. 
 
 The salary which I have received has been at the rate of two thousand 
 dollars per annum, and my actual expenses for living and travel. The total 
 expense of my mission up to the first of November, 1S66, was as follows, viz: 
 
 Salary SI, 673 IS 
 
 Actual expenses 3, 849 79 
 
 Samples of merchandise for government use 142 00 
 
 Assistance 251 97 
 
 Total expenses for ten months and four days 5, 916 94 
 
 The results accomplished have been as follows, viz : 
 Whole number of fraudulent invoices reported, 14S. 
 
 Estimated value of the merchandise upon the same, subject to seizure, con- 
 demnation, and forfeiture, $923,396 34, gold. 
 
 Total value of merchandise actually seized upon my reports and now being 
 prosecuted for condemnation and forfeiture, about 8400,000. 
 
 Amount of forfeitures claimed for fraudulent entry of goods, as shown by 
 my reports, for which suits are being instituted under the 66th section of the 
 act of March 2, 1799, about $200,000. 
 
 Note— The exact value of the " goods seized " cannot be given, as they have not all 
 yet been appraised ; nor can the exact amount of "forfeitures claimed " be given, #s it has 
 not yet been fully determined to what amount prosecutions are to be instituted for. The 
 figures given here will, however, doubtless be exceeded, both in the "value of tlic goods 
 actually seized,'' and in the "amounts of forfeitures claimed, sued for, or to be sued fur." 
 
208 
 
 NEW YORK CUSTOM-HOUSE 
 
 In addition to the foregoing, farther investigations, which are now being 
 made by the customs authorities of* New York, will result in other important 
 seizures and projiecutiong. The evidence obtained, and upon which these frauds 
 have been reported, is voluminous, and cannot well be embodied in a report of 
 this nature. For obvious reasons it would probably be regarded as unadvisable 
 to present it here if it were practicable. It has been submitted to the Secretary 
 of the Treasury, the Solicitor, the collector, naval officer, surveyor, and other 
 revenue otlicers at New York, and to the United States district attorney of that 
 district, all of whom unite in pron muring it conclusive. 
 
 The following letters will show how this evidence is received by these officer! i 
 
 ( i STOM-HOI BE, NEW \ ORE, 
 
 Collector's (tffic October I860. 
 SIR : Mr. W. ]>. Farwell, who Las been in Europe as agent of the Treasury to investigate 
 alleged frauds upon the revenue, ifl about to exhibit to von the result of his inquiries. 
 
 The evidences of fraud have been shown to us. and we consider them a- conclusive : and 
 a large, amount of merchandise has Wen seized upon the proofs presented. 
 
 We believe that the services rendered to the government by Mr. Farwell are of tin- highest 
 importance, and that immense frauds upon tin* revenue will he prevented thereby. 
 Very respectfully, vour obedient servants, 
 
 HENRY A. SMYTHE, Collector. 
 JOHN A. MX. Sural officer. 
 ABRAHAM WAKJEMAN, Smrvegor. 
 
 Hon. Hi (.11 McCullocii, 
 
 Secretary of the Treasury. 
 
 Office op the District Attorney or the (Jotted States 
 
 FOB THE Sot THERM DISTRICT or Nhw Voi:k. 
 
 Xeir York. .Xore win r [). f-CV.. 
 
 Sut: I have the honor to inform yon that, in accordance with instructions given by you 
 to me at Washington, I have made a thorough examination into the documentary evidence 
 furnished by Mr. Farwell in the seizure of ''silks and ribbons'' lately made by the officers 
 of the revenue of this port 't he ev idence furnished me has been prepared with a great 
 ileal of care and skill, and presents to my mind clearly and conclusively that frauds in this 
 class of importations have been very great, and have been carried on for some time prior to 
 the seizures in controversy. Under this documentary evidence alone I think verdicts of con- 
 demnation must follow. 
 
 It is unnecessary for me to go into detail as to the extent and nature of the evidence, as I 
 am informed that you have examined it. and of course are aw are of its purport and bearing. 
 In addition to the documentary evidence, Mr. Farw ell informs me that he has a witness who 
 w ill be here at the trial, who is a thorough expert, and who can prove the allegations of the 
 libels in this class of cases, and show in all the actions, clearly and distinctly, gross under- 
 valuation of the articles imported. He also informs me that since these seizures were made, 
 one of the houses in Europe (whose property has been seized) has altered their valuations in 
 its invoices, and made them correspond with the values which he and his evidence have 
 fixed. This, you will perceive, will be a significant fact on the trial, and will have great 
 weight in securing to the government a condemnation of the property. 
 
 In respect to the sherry wine cases, I think the evidence he has submitted to me wdl 
 secure verdicts of condemnation. In this class of suits the evidence is not so strong as it (s 
 in the "silk and ribbon" cases. 
 
 I have the honor to be, sir. vour obedient servant, 
 
 SAMUEL G. COURTNEY, 
 
 United States Attorney. 
 
 Hon. Hugh McCullocii, 
 
 Secretary of the Treasury. 
 
 There seems to be no room for doubt, that every seizure that has been made 
 and every suit that has been instituted, as growing out of this evidence, will 
 result in favor of the government. I shall take pleasure in submitting this 
 evidence to the personal examination and consideration of the committee. 
 
 For your further information, I respectfully submit the following, being a 
 copy otfny official report to the Solicitor of the Treasury, embodying the 
 general result of my observations and investigations in Europe. 
 
NEW YORK CUSTOM-HOUSE. 
 
 209 
 
 THE FOREIGN IMPORTING TRADE. 
 
 In general terms it may be stated that the importations from the great manu- 
 facturing and producing districts of Europe are mainly carried on by the for- 
 eign manufacturer or producer abroad, through the medium of agents resident 
 in the United States, and most of these latter made up of foreigners established 
 here for the purpose of acting as such agents. 
 
 It is also true, that under this system the foreign manufacturer or producer, 
 as a rule, introduces his manufactures or products — paying an ad valorem 
 duty — at an undervaluation of the real " foreign market value," varying from 
 ten to forty and sometimes fifty per cent. 
 
 The statement is true in reference to the wine-producing districts of France, 
 Spain and Central Europe, the silk and ribbon districts of France, Switzer- 
 land and Prussia, the cloth districts of Rhenish Prussia, Saxony and Austria, 
 and the other large manufacturing sections of continental Europe. In illus- 
 tration of this, I respectfully invite your attention to the following facts : 
 
 Prior to the discovery and exposure of the frauds in the importation of 
 champagne, and up to 1864, when the duties became practically specific, there 
 was but one house in the United States receiving this wine in regular consign- 
 ment from France that was not a foreign resident agency of the manufacturers 
 of wines in Champagne and elsewhere. And the whole of these wines, with 
 the exception of small quantities now and then imported on private order, 
 were regularly imported for about eighteen years, at invoice prices varying 
 from fifteen to forty per cent, below the real foreign market price, or value, at 
 the place of manufacture or production. 
 
 In the silk and ribbon trade of Lyons, Zurich, Basle, Crefeldt, &c, the 
 sherry wine districts of Spain, the cloth trade, &c, &c, a similar state of facts 
 is still presented. I cite a few examples to show this fact. 
 
 ZURICH. 
 
 At Zurich, for the quarter ending June 30, 1S66, the invoice value of silk 
 goods, as shown by invoices certified at the Zurich consulate for that period, 
 was 2,807,260 francs. Of this amount there was shipped by the manufacturers 
 direct to their agents in the United States, to be sold for their (the manufac- 
 turers') account, the sum of 2,382,102 francs ; the balance, 425,058 francs, be- 
 ing sold to regular purchasers. 
 
 It will thus be seen that about eighty-five per cent, of the Zurich silks are 
 sent here on consignment, to be sold for account of the manufacturer, the re- 
 maining fifteen per cent, being sold to purchasers. The proof is conclusive 
 that the portion so introduced into the United States, on consignment for ac- 
 count of the manufacturer, is sent here at invoice prices, from ten to twenty- 
 five per cent, less than those who purchase their goods at Zurich have to pay 
 for the same, or than they can be or are bought for in the largest quantities for 
 cash, for the markets of England or elsewhere. 
 
 BASLE. 
 
 At Basle, for the quarter ending June 30, 1866, there were shipped to the 
 United States silk ribbons as follows : 
 
 Whole amount as per invoice value, 2,434,198 francs. Of this amount there 
 were shipped in regular consignment by the manufacturers to their foreign resi- 
 dent agents here, to be sold for their account, 2,300,604 francs ; the balance, 
 133,593 francs, being sold to regular purchasers. 
 
 It will thus be seen that the proportion of the Basle ribbons thus shipped 
 forsale on account of the manufacturers is about ninety-four per cent., the re- 
 maining six per cent, being imported by regular purchasers. 
 H. Rep. Com. 30 14 
 
210 
 
 NEW YORK CUSTOM-HOUSE. 
 
 In these goods the proof is positive that those so shipped hy the manufactur- 
 ers on consignment, to be sold for their account, are invoiced at prices from 
 fifteen to twenty-five per cent, lower than the same goods are sold for to regu- 
 lar purchasers for any known market. 
 
 The following tabular statement, showing the course of trade in sUks and 
 ribbons from Lyons, Zurich, and Basle, for the first six months ending June 
 30, 1SG6, will furnish a more comprehensive view of the effects, in losses, to the 
 revenue, of this system of fraud : 
 
 Statement of silks and ribhons shipped from Lyons, Zurich, and Basle for the 
 first six months of 1SG6. 
 
 Lyons. 
 Zurich 
 liaise . 
 
 Francs. 
 
 25, < -35 
 
 751,005 
 
 10, 
 
 '. :;•.*:;. 582 
 
 2 = .~ 
 
 
 
 it 
 
 
 
 lb! 
 
 o 
 
 o - 
 
 u 5 
 £•£ 
 
 - ci 
 < 
 
 Francs. 
 
 19,271,876 
 it, 13-, 354 
 6, 884, 372 
 
 Francs. 
 2, ~oi i f 7~l 
 1,369,753 
 1 , 032, 055 
 
 ■ _ — 
 
 V - '- 
 
 >3 
 
 Francs. 
 
 1,734,408 
 r-21, -51 
 GJ9,59^ 
 
 Loss in duties for six months 
 Loss in duties per annum 
 
 1 it 
 
 £322,011 04 
 152, -04 -J- 
 115,244 89 
 
 590,719 01 
 181,439 01 
 
 The foregoing statement is based upon official returns from the consulates at 
 Lyons, Zurich, and Basle, except in so far as the amount of goods sent on con- 
 signment by the manufacturers from Lyons is concerned. The estimated 
 amount of the latter is placed at seventy-five per cent., and certainly cannot mil 
 short of that amount, but will probably exceed it. 
 
 The proportions from Zurich and Basle, eighty-five per cent, and ninety-four 
 per cent, respectively, are from the official reports to me of the consuls at those 
 places. 
 
 The estimated average undervaluation is placed at fifteen per cent. The 
 burden of the evidence shows it to be considerably in excess of this amount, 
 and therefore this can but be regarded as a reasonable estimate. 
 
 A careful comparison of the invoice prices of those houses of Basle and 
 Zurich whose goods are actually under seizure in New York, on my reports, 
 shows the average undervaluation of the invoices shipped on consignment to be 
 sold for their account by these houses to be eighteen and one-eighth per cent. 
 
 THE SHERRY WINE TRADE. 
 
 The sherry wine trade of Spain has been conducted for many years upon a 
 similar basis, except that in this trade the average undervaluation of wines 
 shipped by the manufacturer to agents in the United States, to be sold for his 
 account, is far greater. 
 
 The house of Pemartin & Co., of Jerez de la Frontero, in Spain, is one of 
 the largest manufacturers and shippers of sherry wine to the United States. 
 In the spring of 1865, on my return from a mission to Europe as "special 
 agent of the Treasury Department," in the course of my investigations at the 
 Boston custom-house, I found that the invoices of this house to J. D. & M. 
 Williams were fraudulent, and so reported the fact. The fraud was not denied, 
 and, as is known, the sum of 825,224 was paid as a penalty and forfeiture 
 therefor. 
 
HEW YORK. CUSTOM-HOUSE. 
 
 211 
 
 The same house, Pemartin & Co., shipped the same wine, also in large quan- 
 tities, to New York, as they also do at present. Up to the time of the discov- 
 ery and exposure of their fraudulent mode of doing business, Pemartin & Co. 
 invoiced their wines at a uniform undervaluation for New York and Boston. 
 As soon as the fraud was exposed they changed their mode of invoicing, and 
 have since invoiced at correct prices, as will be seen from the following state- 
 ment : 
 
 Statement showing former and present rate of invoicing sherry wine by Pemar 
 tin 4* Co., with difference in duties per quarter cask at false and true rates. 
 
 Brands. 
 
 Invoice prices per quar- 
 ter cask prior to dis- 
 covery of fraud. 
 
 Invoico prices per quar- 
 ter cask after discov- 
 ery of fraud. 
 
 "Duty paid per quarter 
 cask at former rate 
 of invoicing, at 50 
 per cent, ad valo- 
 rem. 
 
 | 
 
 ~ — = "5 
 
 C 83 'o ®T3 
 £»0 8 * 
 
 ° "£ o 
 
 - 2 ~ - 
 
 Q 
 
 Pemartin. 
 
 
 
 
 
 + v 
 
 852 94 
 
 $73 57 
 
 826 47 
 
 836 78 
 
 m 
 
 58 23 
 
 88 51 
 
 29 11 
 
 44 25 
 
 m 
 
 87 87 
 
 126 44 
 
 43 94 
 
 63 22 
 
 [V] 
 
 40 00 
 
 65 52 
 
 20 00 
 
 57 76 
 
 [V] 
 
 50 00 
 
 83 94 
 
 25 00 
 
 41 97 
 
 A 
 
 60 00 
 
 88 51 
 
 30 00 
 
 . 44 25 
 
 
 
 42 50 
 
 65 52 
 
 21 25 
 
 32 76 
 
 From the date of the exposure of the frauds of this house until my recent 
 reports of false invoices of sherry wines, I am not aware that any further 
 frauds in the importation of sherries were discovered. The proofs are now in 
 hand, however, going to establish the fact that these frauds run through the 
 greater part of the sherry wine trade. The seizures that have been made upon 
 these proofs, and the other steps that have been or will be taken by the revenue 
 authorities will, in almost every instance, in forcing a change in the rate of 
 invoicing these wines, such as that which has been made by Pemartin & Co., 
 produce results, in the augmentation of the revenue in the future, of vast im- 
 portance. 
 
 A few instances, showing the real value of the leading brands of sherry 
 wines as compared to the invoice values at which these wines have heretofore 
 been introduced into the United States in making entry of the same at the 
 custom-houses, will exemplify the correctness of this assertion and illustrate 
 the importance of putting an end to these frauds in foreign importations. 
 
212 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Statement showing undervaluation of sundry brands of sherry wine as regularly 
 imported into the I'm hit States. 
 
 
 |L 
 
 
 
 
 y 
 
 <tf«5 
 
 - o 
 
 8 
 
 P< . 
 
 A 
 
 as 
 1 
 
 
 
 9 
 
 Q ^ 
 
 ■a 1 2 
 .5 a 
 
 s i 
 
 o 5. 
 t- 
 
 g* . 
 
 c — 
 
 p . M 
 
 |J 
 >r | 
 
 'S 
 
 .5 
 
 c g 
 
 Cm •_. 
 
 &■ . 
 
 a 9 
 .s >— 
 
 H 
 
 9 
 
 
 s 
 
 H 
 
 
 M 
 
 
 
 CP] 
 
 $36 00 
 
 $01 00 
 
 [V] 
 
 §70 00 
 52 00 
 
 $84 70 
 
 CP] 
 
 31 00 
 
 72 15 
 
 [V] 
 
 67 76 
 
 OOP 
 
 27 0Q 
 
 40 70 
 
 ooov 
 
 36 oo 
 
 52 03 
 
 
 22 00 
 
 34 25 
 
 ov 
 
 28 00 
 
 38 72 
 
 [P] 
 
 17 00 
 
 30 00 
 
 No. 1 
 
 27 00 
 
 31 46 
 
 
 
 Im 
 
 H 
 
 H 
 
 i o 
 
 ■ 
 
 b 
 
 .. a 
 
 
 B 
 
 & 
 
 
 Z. r. 
 
 & 
 
 ll 
 
 |i 
 
 ~ s 
 
 
 o es 
 •r; O 
 
 r Jd 
 
 cL 2 
 
 d of w 
 letta's 
 
 si 
 
 c : - 
 
 s i 
 
 - - - 
 
 ;- ^ 
 
 c, - 
 
 £ •- 
 
 b a 
 
 
 
 'cS 
 
 
 
 
 
 a 
 
 a 
 
 M 
 
 
 
 (S 
 
 [1] 
 
 $20 90 
 
 £24 75 
 
 Sherry 
 
 §16 00 
 
 $26 00 
 
 C2] # 
 
 26 56 
 
 35 80 
 
 Malmsey 
 
 16 00 
 
 26 00 
 
 [S] 
 
 34 J ") 
 
 46 00 
 
 Madeira 
 
 16 00 
 
 26 00 
 
 
 00 
 
 46 00 
 
 1 
 
 22 00 
 
 56 00 
 
 [1825] 
 
 44 50 
 
 56 25 
 
 2 
 
 30 00 
 
 64 00 
 
 M 
 
 00 
 
 65 44 
 
 
 
 
 These examples are given simply by way of illustration of the extent of the 
 undervaluation of sherry wines alone. They are susceptible of being given in 
 relation to nearly all the brands of sherry wines imported into the United 
 States, but I do not deem it necessary in a report of this nature to follow it 
 further. The importance of the subject may be briefly summed up by citing 
 the case of the wines of Lacave & Echecopan. 
 
 The shipments of this house alone to the United States amount to about 
 350,000 gallons annually. The loss in duty under their system of undervalu- 
 ation is, approximately, thirty-five cents per gallon — making a total loss in 
 duties per annum of 8122,500 from the wines of this one house alone. 
 
 If the statements which I have made in reference to the frauds perpetrated in 
 the importation of silks and ribbons from Zurich and Basle, and of sherry wines 
 from Spain, be correct, and if the proofs of these frauds be sufficient to establish 
 the facts which I have alleged, the system, so far as these places are concerned, 
 will be at once broken up ; and, assuming that the same amount of goods will 
 continue to be imported, and duties paid on correct values hereafter, instead of 
 on false ones, as heretofore, there will be an increase in the revenue from these 
 sources alone of hundreds of thousands of dollars per annum. What is true of 
 these classes of importations is equally true as applied to the other large manu- 
 facturing and producing districts of Europe. What has been given will serve 
 as an illustration of the whole system, whether as applied to one or more lead- 
 ing branches of importations of goods paying an ad valorem duty. 
 
 All these frauds are at present under investigation, with a certainty that all 
 can and will be broken up ; thus not only largely increasing the public revenue, 
 
NEW YORK CUSTOM-HOUSE. 
 
 213 
 
 but opening the way for legitimate competition in the foreign importing trade 
 on the part of the American merchant. 
 
 In connection with this latter remark I would say that out of thirty different 
 importing houses in the United States, reported by me as receiving goods from 
 abroad falsely invoiced, twenty-seven are foreign commission houses and three 
 are American. While it is gratifying to know that so small a percentage of 
 Americans enter into this illegitimate trade, it can scarcely be regarded as a 
 source of gratification to find that the foreign importing trade is, through this 
 system of fraud, so completely monopolized by citizens coming from other 
 countries. 
 
 EXAMINATION AND APPRAISEMENT OF MERCHANDISE. 
 
 The system of examination and appraisement of foreign merchandise at the 
 several custom-houses of the United States has thus far utterly failed to detect 
 and expose these vast frauds upon the revenue. It may well be doubted, per- 
 haps, whether it is possible for any system of appraisement and examination to 
 be devised that would remedy the evil. Something should be done, however, 
 to counteract the influences which fraudulent importers too frequently exercise 
 in the examining and appraising departments of the customs, and to secure more 
 care in passing upon invoices than now seems to prevail. 
 
 Instances can be pointed out where invoices of goods from the same manufac- 
 turer, of the same quality aud description precisely, have been passed within a 
 few days of each other — the one an invoice of goods actually sold, the other an 
 invoiee of goods consigned by the manufacturer to his agents to be sold for his 
 account; the first being made up at the regular wholesale market prices, the 
 second at prices largely under those given in the first, and consequently paying 
 much less duties. 
 
 Such instances as these, carefully examined into in this department, would 
 necessarily result in the detection and exposure of systematic frauds. Left to 
 pass unnoticed, as they seem to have been heretofore, argues strongly that the 
 examining and appraising system, as at present practiced, is inefficient, to say 
 the least. 
 
 " Merchant appraisements," upon invoices raised by the appraisers, are often 
 more than farcical. The " merchant appraiser " is too frequently the friend of 
 the importer whose invoice is in question, or is himself, with the witnesses called 
 as experts in the values of foreign merchandise, practicing constant frauds upon 
 the revenue of precisely a similar character to that submitted to his arbitration. 
 The result is generally in favor of the fraudulent importer. 
 
 It is not my purpose to cast the blame in such cases upon the appraisers. 
 The fault rather lies in the great fact of the system of frauds, by which all that 
 is known of certain classes of merchandise — in regard to their foreign market 
 value — is confined to a circle of persons interested in the importation thereof. 
 These being the only ones that can be called in as experts to decide mooted 
 questions concerning values, find no difficulty in protecting each other by sus- 
 taining the original invoice values. 
 
 MEASURES ADOPTED BY THE TREASURY DEPARTMENT TO EXPOSE AND DEFEAT 
 THESE FRAUDS, AND DIFFICULTIES THAT HAVE BEEN ENCOUNTERED IN CAR- 
 RYING OUT THESE MEASURES. 
 
 Under the directions of the Solicitor of the Treasury the provisions of the act 
 of March 3, 1863, relative to the verification of invoices in triplicate at the con- 
 sulates, as also the provisions of the act of March 3, I860, relative to furnishing 
 samples of merchandise with their invoices at the consulates, by shippers and 
 manufacturers, have been energetically enforced. Two agents have been em- 
 ployed in Europe to visit the various manufacturing districts, and to examine 
 
214 
 
 NEW YORK CUSTOM-HOUSE. 
 
 into and report upon the system of invoicing, iVc. These measures in them- 
 selves have had a moral effect upon shippers of gre:it importance, in many in- 
 stances securing a correct mode of invoicing through the simple fear of discovery 
 if former fraudulent practices were adhered to. That they will continue to bay* 
 a salutary effect cannot be doubted. 
 
 But at every step every effort that lias been made to detect and expose fraud 
 has been met by potent counter influences thai have seriously interfered with 
 and at times threatened to render all such efforts useless* 
 
 Fraudulent importers — in many instances houses which through a long series 
 of years have sustained a position of respectability in business and social circles 
 that placed them far above and beyond suspicion, until the inevitable logic and 
 proof of facts disclosed their corruptibility — in their transactions with the gov- 
 ernment have not found it difficult to deceive and mislead men high in public- 
 station, and so in a measure to shield themselves, by the powerful influences 
 thus successfully invoked, from public condemnation. Tliey have found friends 
 in public stations and elsewhere, who have vied with each other in denouncing 
 and villifying all those who in the interests of the government have Bought to 
 enforce the laws and expose fraud wherever it may have been perpetrated. 
 The cry of "persecution" has been raised, facts distorted and misstated, and 
 public sympathy manufactured for those who have for so long a period defrauded 
 the government, that sometimes seem to martyrize the latter and condemn with 
 an unsparing edict those who, in the plain line of official duty, are seeking to 
 bring offenders to justice and to enforce the law. 
 
 It can scarcely be regarded as irrelevant to the spirit and scope of this report 
 to say that the time seems to have been reached when it is the duty of the gov- 
 ernment to stand by its officers who are engaged in this work, no matter what 
 may be the influences that surround " the respectable merchant " detected in de- 
 frauding the revenue, so long as the acts of such officers are justified by verdicts 
 rendered upon the law and the facts, as the courts expound the former, and as 
 these officers succeed in developing the latter. 
 
 THE CONSULAR SYSTE.M OF THE UNITED STATES IK EL'ROPE. 
 
 Consuls of the United States residing in the principal commercial and manu- 
 facturing districts, under our revenue laws as they exist at present, are practically 
 commercial agents of the government, and as such occupy a much nearer rela- 
 tion to the Treasury than to the State Department. I am impressed with this 
 fact as one of the results of my investigations, and I am moreover very thor- 
 oughly convinced that the whole consular system needs revision and reorgani- 
 zation. 
 
 Under the act of March 3d, 1S63, and the act of March 3d, 1865, already 
 referred to in this report, very responsible and onerous duties were made to de- 
 volve upon consuls in addition to those which they were required by law to per- 
 form before. Although this additional official duty was imposed upon them, 
 and so much was looked for from them in protection to the revenue, I am not 
 aware that any material change was made in the general rate of a compensation 
 and clerical assistance. 
 
 The revenue derived from the fees collected by consuls, in the certification of 
 invoices under the act first referred to, is, I believe, very largely in excess of the 
 expense of salaries, &c. Nevertheless there are consulships in various parts of 
 Europe that are paid from SI, 500 to 82,500 per annum, where the invoices 
 which have to be certified in triplicate amount to hundreds of thousands of dol- 
 lars per annum, and where the certification of a single one made up at an un- 
 dervaluation may often cause a loss to the government in revenue of more than 
 enough to pay the entire expense of the consulate for one, two, or three years. 
 The consul is expected and required by law to inform himself fully as to the 
 
NEW YORK CUSTOM-HOUSE. 
 
 215 
 
 credibility of the person presenting an invoice foV verification, and to avail him- 
 self of every possible means to ascertain the correctness of the prices given in 
 the invoice. 
 
 Often he is allowed no clerk, and the mere daily routine of office business 
 generally requires his entire time during office hours. If he had the time and 
 the inclination to go into the market to price goods, his inquiries would avail 
 nothing, smce his very presence, well known to shippers, would at once adver- 
 tise and thwart his object. 
 
 His salary — barely sufficient, and sometimes not enough, to enable him to 
 meet his actual expenses — will not permit him to call in outside aid to enable 
 him to ascertain real prices, &c, and however zealous he may be in his desire 
 to serve the government faithfully and well, he is too often powerless to do more 
 than the actual office duty, generally entirely clerical in its nature. 
 
 The system is open to another vital objection also. The interests of shippers 
 are generally so important, in connection with their shipments to the United 
 States, that to conciliate and secure the friendship of the consul, they would 
 neither hesitate nor scruple to make him the recipient of money or other valu- 
 able objects, to cause him to be more warmly in their interests than in the inter- 
 ests of the government whose agent he is. I do not mean to say that there is 
 a single instance of this kind in Europe ; but I do mean to say that while the 
 interests of the government are so largely against the interests of shippers 
 abroad, it is bad policy to send men abroad as consuls, with a bare pittance to 
 live upon, where they are liable to be tempted by such influences, and where by 
 a single stroke of the pen they can, as I have said, cause the government to 
 lose more in revenue than the cost of supporting the consulate for one, two, or 
 three years. 
 
 There have been consuls in Europe during past years, who have — through 
 some motive which I do not pretend to fathom — been the warmest partisans, 
 and most earnest advocates of the cause of shippers known to be in the constant 
 practice of defrauding the revenue. There are and have been men abroad in 
 the capacity of consuls who are physically incapable, and in business ability 
 improper men to perform the official duties of their consulates. 
 
 Another evil of the system is that of consular agencies. Consuls with small 
 salaries, permitted by law to receive the fees from agencies attached to their consu- 
 lates, are too often found establishing such agencies within their district, when the 
 business of the consulate could quite as well be performed at the consulate itself 
 without muecessary inconvenience to the shipper. It is generally the case that 
 these agents are men either engaged in business with America themselves, or 
 neighbors of such as are — retired merchauts, or young men of the country seek- 
 ing employment, but all, by their birth and social and business relations, gener- 
 ally the intimate friends of the shippers of the district, and with no other devo- 
 tion to the interests of the government of the United States than that inspired 
 by the dignity of their official title, which, to be sure, is a prize always eagerly 
 coveted. 
 
 How far the interests of the government are likely to be protected in the hands 
 of such men may be easily judged. As an agent of the department, visiting con- 
 sulates with my official character, I desired to be kept unknown to any other 
 than the consul. I cannot call upon such agents for the purpose of obtaining 
 information in revenue matters, except in the fear aud expectation of my pres- 
 ence being advertised at once in circles where it is most desirable that it should 
 be unknown 
 
 I am not unaware that this will provoke opposition from consuls whose offi- 
 cial emoluments are affected by such agencies. Nor do I say that there are not 
 agents who are true to the interests of the government ; but it must be patent 
 to every observing mind that, for the reasons I have named, the system is radi- 
 cally wrong. 
 
216 
 
 NEW YORK CUSTOM-HOUSE. 
 
 In my judgment, wherever there is business enough for a consular agency, 
 generally Speaking there should be a full consulate. And wherever a consul iB 
 required the position should, both for the dignity and financial welfare of the 
 government, Be filled by the appointment of the best men that can be selected, 
 who, in all respects, are fully qualified for the duties of the office, and then 
 should be sufficiently well paid to secure faithful service to the government and 
 to none other. When such men are placed in such positions, and ku>t there so 
 long as they are true to the very important interests confided to them, the pub- 
 lic revenue, as at present derived by law, will be greatly benefited, and the 
 dignity of the government abroad be properly sustained. 
 
 1 have the honor to be, with great respect, your obedient servant, 
 
 W. E FAB WELL, 
 
 Revenue Agent. 
 
 SEIZURES OF CIIAMPAGNE WINES, CONSIGNED FROM THE MANUFAC- 
 TURERS AT REIMS, FRANCE, TO THEIR ACENTS IN NEW YORK. 
 
 1. Frederick de Barry, agent of G. H. Mumm if Co., Reims. 
 
 1. Original testimony, and was re-called once or twice. 
 
 2. Correspondence Montgomery Gibbs, with G. II. Mumm &; Co., Reims. 
 
 3. Letter of February 2, from De Bary to Mr. Hulburd, enclosing de- 
 
 position of John Bigelow, minister to France. 
 
 4. Testimony of W. B. Fanvell, taken in United States district court 
 
 at New York. 
 
 2. Thomas W. Bavaud, agent of Charles Heidsick, Reims. 
 
 1. Original testimony, and was re-called once or twice. 
 
 2. Correspondence Montgomery Gibbs, under the alias Amos Hill, with 
 
 Charles Heidsick, Reims. 
 
 3. Affidavit Richard II. Teller, late assistant appraiser. 
 
 3. Cornelius J. Rooney, formerly hook-keeper of M. Gibhs. — Proving 
 handwriting of M. Gibbs, in the correspondence with Mumm & Co., (signed 
 M. G:bbs,) and Charles Heidsick, (signed Amos Hill.) 
 
 4. AVilliam B. Coughtry. — Proving true copies of the Gibbs's letters. 
 
 5. L. E. Chitte.\ de.\, late Rtgister of the Treasury. — As to interview with 
 the custom-house officials about case of Charles Heidsick and Thomas W. 
 Bayaud (above.) 
 
 6. Renauld, Fraxcoise & Co. — Testimony given by Mr. Bartels and Mr. 
 Renauld, agents of Piper Heidsick wine. 
 
 7. Richard H. Teller, late assistant United States appraiser. — How the 
 market value of champagne was ascertained under tariff of 1846, and agree- 
 ment on the part of the custom-house with Renauld, Francoise & Co., and F. 
 De Bary, as to the prices they should invoice their wine at. 
 
 S. Ed. Leuchtenrath. 
 
 1. Agent used by Gibbs and Far well to obtain retail prices of champagne 
 
 in Paris. Original testimony, and was re-called once. 
 
 2. FarwelPs deceiving him ; that he was employed by the government 
 
 at the San Francisco custom-house, and taking receipts for his 
 monthly salary upon the official blanks of the San Francisco custom- 
 house. 
 
 9. A. Oechs, agent of Moet & Chandon. 
 
 10. Jaues Meyer, Jr., agent of Jules Mumm. 
 
 11. H. Batjer, agent of San Marcaux. 
 
NEW YORK CUSTOM-HOUSE. 
 
 217 
 
 12. John G. Welsh, agent of Charles Fair. 
 
 13. H. G. Schmidt & Co., agent of Veuve Cliquot. 
 
 14. Clement Heerdt. 
 
 15. Lalance & Grosjean, by P. A. Perrin. 
 
 New York, January 11, 1867. 
 FREDERICK DE BARRY sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business ? 
 A. Yes. 
 
 Q. What kind of merchandise do you import ? 
 A. Wines, brandies, and cigars. 
 Q. How long have you been in the business % 
 A. Since 1852 % 
 
 Q. Have you had difficulties with the custom-house here ? 
 A. Yes ; several times. 
 
 Q. State the circumstances attending the different seizures. 
 
 A. In May, 1864, the champagne seizures in California took place ; and 
 having been a witness in that case, on my return, I went to the general ap- 
 praiser to ask him whether I was right in entering my wines according to the 
 appraisement of 1862. Judge Hogeboom was then general appraiser. After 
 I had given him the prices, he told me I was perfectly entitled to do so, and I 
 entered my invoices, but they raised it about twenty per cent, above the value 
 I formerly entered my invoices at. Having spoken with the judge again, he 
 told me he could not tell me anything, but to call for a reappraisement. 1 did so, 
 but could get no redress. Mr. Barney was then collector, and I went with my 
 lawyers, and insisted on a reappraisement, and he said I should have one. In 
 the mean time Hogeboom went to Canada, and Dorrance, of Boston, was then 
 appraiser. When the reappraisement took place I was not allowed any wit- 
 nesses. There were lawyers of the custom-house there ; and a gentleman named 
 Dale, a manufacturer of buttons and fringes, acted as merchant appraiser, but 
 this reappraisement has not been concluded yet, although my goods were seized, 
 and are still seized. I gave bonds for them ; but they still retain ten per cent, 
 of them, and I have had no reappraisement yet. The ten per cent, amounts to 
 about 80 cases. 
 
 Q. Whose fault is that ? 
 
 A. I think it is the fault of the Solicitor of the Treasury, who is at the 
 bottom of the whole thing. 
 Q. Why does he delay it ? 
 
 A. I do not know. The law says that within twenty-four hours after an 
 application is made for a reappraisement it shall take place. 
 
 Q. Why do you think the Solicitor of the Treasury is the cause of the 
 delay ? 
 
 A. Because, in my opinion, he gets part of the amount seized. This thing 
 stands as it is about the champagne case ; and in January last year, on going 
 to my office, I found the custom-house officers employed in seizing my books. 
 I saw they had a warrant from a city judge here, on the oath of a man who is 
 in the employ of the custom-house, but whose name I do not know. They 
 took the books and papers away, and left officers there in charge. I went to 
 the collector, and the matter was hurried up, and three days afterwards I got 
 the books, &c, back, with an excuse that they found everything correct. On 
 looking through my papers I missed one document, which was my contract with 
 the house of J. H. Muinm, of Reim3. I missed it at once, because it was a 
 
218 
 
 NEW YORK OUSTOM-HOU8E 
 
 most important document for me. T inquired for it, and they could not find it. 
 Finally, some one told me to ask Mr. Hanscom for it, and 1 did so, but he said 
 he did not know where if was. I asked him if* it was not in his <l«-.»k. and he 
 opened his desk and there it was, and I got it back. This makes me beli< ve 
 that the whole seizure was intended not for cigars, as they pretended it was, 
 but to find out about the champagne cases. In respect to that champagne I 
 wish to say one thing — that, in my estimation, it degrades the United State- ID 
 employ such men as they have done'. Some time since the house of J. H. Murnm, 
 which I represent, received a let! r from a Mr. Montgomery Gibbs, requesting 
 them to give him the lowest pries of champagne, and that these wines were 
 for Aspinwall. My house answered him that they were not permitted to sell 
 to any person but to me, and they directed him to me. Mr. Gibbs wrote back 
 again, requesting them to send him 200 cases of wine, which he would pay for 
 at the price they charged ; but at the same time he requested them to give him 
 a second invoice at a lower price, which was intended, as he said, to enter the 
 wines in the United States custom-house in ease the wines were not shipped to 
 Aspinwall. Our house; refused to have any transaction with him, telling him 
 they would not permit any person to defraud any country. I have that cor- 
 respondence, the original letter of Mr. Qibbs, and a certified copy by the United 
 States consul of the reply of my house to the letters, and I will produce them 
 before the commit tic at a future time. 
 
 I have another case I wish to mention to you. Mr. Farwell employed a man 
 named Leuchtenrath, who is now in this city, to get, if possible, the highest prices 
 of champagne from the merchants in Reims. I understand Mr. Farwell paid 
 him a salary ; and he was requested not to go to the wholesale houses in Paris, 
 but to go to the restaurants and small dealers, who knew nothing about the whole- 
 sale prices of champagne. I must say they are a regular set of thieves there in 
 that custom-house. There were also about 1,000 cigars stolen from me in the 
 bonded warehouse; but there they said they had been stolen in the lighter. I 
 myself believe they were smoked in the custom-house. All the cigars imported 
 have to be sent to the public store to be examined, and we are completely at 
 the mercy of these men, for they take out of our packages any amount they 
 want, and they are not responsible for so doing. They also seized a lot of cigars 
 in the bonded warehouse, and had them inspected, and they finally found that 
 out of 40,000 cigars 2,000 . An appraiser of the name of 
 
 Lothrop appraised higher, as he said, then, at the request of Mr. llauscom. I 
 called for a reappraisenient, and the invoice was found perfectly correct. 
 
 New York, January 12, 1867. 
 FREDERICK DE BARRY recalled and examined. 
 
 By the Chairman : 
 
 Q. Have you been abroad frequently? 
 A. Yes. 
 
 Q. When were you last in Paris 1 
 A. From July to October last. 
 
 Q. Did you know Montgomery Gibbs, said to be United States revenue agent 
 there ? 
 
 A. I heard a great deal about him. 
 Q. Did you hear his place described ? 
 
 A. He had rooms engaged in which he received callers in grand style, with a 
 nigger standing by. 
 
 Q. What is the general estimation in which he is held there ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 219 
 
 A. Everybody there despises him, I was asked several times how it was 
 possible that the United States should be represented by such a man. I wish 
 to make a few more remarks here. The custom-house officers kept me for three 
 months in suspense, all the time seizing my goods and troubling me in order, I 
 suppose, to make money out of me, because they knew very well that I had 
 not done anything wrong. The whole system of the custom-house here — the 
 whole machine — is run more for the benefit of the officers than for the interests 
 of the United States. 
 
 New York, January 18, 1867. 
 FREDERICK DE BARRY recalled and examined. 
 By the Chairman : 
 
 Q. Can you produce the correspondence between Mr. Montgomery Gibbs and 
 the house of G-. H. Mumm, of Reims, which you represent in the United Statesf? 
 
 A. I here produce the original letters of Mr. Montgomery Gibbs, and the 
 answers of the house to him, which are in the handwriting of my brother, Mr. 
 William De Barry, a partner in the house, and which are certified by the Amer- 
 ican consul at Reims. 
 
 (The letters were put in evidence here and copies directed to be made of 
 them.) 
 
 Q. Are you acquainted with the French language % 
 A. Yes. 
 
 Q. I wish to ask a question in reference to the Boston Williams case ; is. the 
 word " simule" which is used in the French language, a word of commercial im- 
 port ? 
 
 A. It is. 
 
 Q. What is the usual signification of that word in commercial understanding % 
 A. It is about the same meaning as " fictitious but it is very often used, as, 
 for example, in an invoice to mean " seemingly." It means, in an invoice, to 
 represent goods which are not yet sold — that is, the profits not yet ascertained. 
 It has something like the same meaning as the word " conte jinto" used in Ger- 
 many has. It is an unknown quantity, to be determined by the solution; a 
 profit assumed, but which will depend on results ; an amount assumed to cover 
 sales noi yet ascertained. 
 
 Astor House, New York, February 1, 1867. 
 
 F. DE BARRY recalled. 
 By the Chairman : 
 
 Q. Mr. Teller has been here and affirmed as to how the market value of 
 champagne was ascertained, and he said that his impression was that the wine 
 of Mr. De Barry was invoiced at those prices agreed upon between you and 
 the government, when the champagne was seized ? 
 
 A. Yes, sir. 
 
 Q. There was no variation after that 1 
 
 A. Never after that ; a kind of agreement had been made between the custom- 
 house and myself. They told me " this is the market value." 
 
 Q. How came they to seize your goods without notifying you ? 
 
 A. Because they wanted to black-mail me. I submit, as part of my testi- 
 mony, a paper marked IS, 404, 407, a certified copy, of the district court of the 
 southern district of New York : 
 
220 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Uxitkd Statks of Amkkha, 
 
 Southern District of New York, City, County, and State of New York, ss : 
 Be it remembered, that on this fourth day of January, in the year of our Lord one thousand 
 eiplit hundred and sixty-six, I, George F. Betts, a commissioner duly appointed by the 
 circuit court of tin; United States for the southern district of New York, in the second circuit, 
 Under and by virtue of the act of Congress entitled " An act for the more convenient taking 
 of Affidavits and bail in civil causes, depending in the courts of the United States," passed 
 February 20, 1812, and the act of CongreM entitled "An act in addition to an act entitled 
 'An act for the more convenient takinjr of atlida\ its and bail in civil causes depending in the 
 courts of the United States,'" passed March 1, 1H7, and the actentitled " An act to establish 
 the judicial courts of the United States," passed September 24, 17-'.», did call and cause to be 
 and personally appear before me, at my othce at II Chambers street, in the city of New York, 
 in the said southern district of New York, in t he State aforesaid, WillardB. Farwcll, to testify 
 and the truth to say, on the part and behalf of the libellant in a certain suit or matter of con- 
 troversy now depending and undetermined in the district court of the United States for the 
 southern district of New York, at New York, wherein the United States are libellants against 
 
 000 cases of champagne wine, marked (EXC;) and the said Willard B. Farwell, being 
 about the age of thirty-six years, and having been by me first cautioned and sworn to testify 
 the truth, the whole truth, and nothing but the truth, in the matter of controversy aforesaid, 
 
 1 did carefully examine the said Willard B. Farwell, and he did thereupon depose, testily, 
 and say as follows, viz : 
 
 I reside in San Francisco. California; expect to go there on the 11th of this month. Tlio 
 time of my return, to me, is uncertain. 
 
 Q. How long have you resided in San Francisco, and w hat has been your occupation there 
 during the three years last past ? 
 
 A. I have been there sixteen years, and over; I have been naval officer of the port during 
 the last three years, up to last August. 
 
 Q. Have you, during that time, spent any time away from this country ? and if so, where? 
 
 A. I have. I went abroad last winter, under the directions of the Treasury Department, 
 and spent some months in France and other parts of Europe, most of the time in l'aris ; be- 
 sides that, a single day in Epernay, a town in the champagne district. 
 
 Q. Are you at present employed by the Treasury Department to aid in the prosecution of 
 this case, among other champagne cases? 
 
 A. I am not. 
 
 Q. When did your employment as special agent of the Treasury Department in respect to 
 the champagne cases cease ? 
 
 A. It has ceased as special agent, some weeks ago. I am employed as general revenue 
 agent of the department. 
 
 Q. Are you not expecting soon to return to Europe, to procure, among other things, ad- 
 ditional testimony in the champagne cases, in behalf of the prosecution? 
 
 A. I shall decline to answer that question, as I am not at liberty to make known my in- 
 structions from the department. I should have no objection, personally, to answer the ques- 
 tion. 
 
 Q. Are you expecting soon to return to Europe ? 
 
 A. I shall decline to answer that question for the same reason. 
 
 Q Have you given any intimation to any of the officers of the Treasury Department at 
 Washington that you intend to claim as an informer in this case ? and if so, to whom? 
 
 A. I may have spoken of the matter, but I have never given any formal notice to that 
 effect to any person. 
 
 Q. To whom have you spoken ? 
 
 A. I shall decline to answer that question. 
 
 Q. Have you alluded to the subject to Mr. Jordan, Solicitor of the Treasury, either di- 
 rectly or indirectly ? 
 
 A. I may have done so ; I think I have spoken to him about it. 
 
 Q. Is your compensation as revenue agent to be influenced in any way by the result of 
 these champagne prosecutions ? 
 
 A. No, sir ; not to the extent of one farthing. 
 
 Q. Have you any understanding or expectation, express or implied, that if you succeed 
 as informer, you are to pay any portion of the sum received to any officer of the Treasury 
 Department in Washington ? 
 
 A. I have no such understanding or expectation. 
 
 Q. Do you know of the circumstances of the prosecution of J. D. & M. Williams, in Bos- 
 ton, on account of importations of champagne? 
 (Objected to as irrelevant and immaterial.) 
 A. I do not. 
 
 Q. Do you know of the payment by Williams's firm of money to any officers of the treas- 
 ury, on account of champagne importations ? 
 (Objected to as irrelevant and immaterial.) 
 
NEW YORK CUSTOM-HOUSE. 
 
 221 
 
 A. I know of the payment by Williams & Co., to the collector of the port of Boston, on 
 account of fraudulent champagne importations, 
 Q. How much ? 
 
 A. One hundred thousand dollars for champagne, besides twenty-five thousand dollars in 
 respect to sherry importations ; this latter I only know by hearsay. 
 Q. Did you claim as informer in that case ? 
 A. In the champagne case I did. 
 Q. How much did you receive ? 
 A. Twenty-five thousand dollars. 
 
 Q. Did you pay any portion of that to any other person? 
 (Objected to as'irrelevant and immaterial.) 
 A. I shall decline to answer the question. 
 
 Q. Did you pay any portion of it to any officer of the Treasury Department at Washing- 
 ton, or, after receiving it. did you make a payment to any officer of the Treasury Depart- 
 ment ? 
 
 (Objected to on same grounds.) 
 A. I did not. 
 
 Q. To your knowledge, did the Solicitor of the Treasury receive any portion of the money 
 paid by Williams's firm on account of the aforesaid champagne seizures or prosecution ? 
 A. Not to my knowledge. 
 
 Direct examination resumed: 
 
 Q. Have you examined to see whether you have in your possession the original papers 
 which in your first examination you spoke of as having been seized in the hands of the agents 
 of Eugene Clicquot, at San Francisco ? 
 
 A. I have examined. I find I have not got them with me, or in my possession. 
 
 Q. Where, and in whose possession, did you last know them to be? 
 
 A. In the hands of N * * , district attorney at San Francisco, some of them ; and some 
 in the custom-house there. 
 
 Q. Who were agents of Eugene Clicquot at San Francisco ? 
 
 A. James Behrins, and also Alfred Borel. 
 
 Q. In what way does each of these act as agent there ? 
 
 A. Behrins receives the wine and enters it at the custom-house, and sells it. Borel acts 
 as a kind of financial agent of Clicquot, but I hardly know to what extent his agency goes. 
 
 United States of America, 
 
 Southern District of New York, City, County, and State of Xeic York, ss : 
 Be it remembered, that on this 5th day of January, A. D. 1S66, I, George F. Betts, a 
 commissioner duly appointed by the circuit court of the United States for the southern dis- 
 trict of New York, in the second circuit, under and by virtue of the act of Congress entitled 
 "An act for the more convenient taking of affidavits and bail in civil causes depending in 
 the courts of the United States," passed February 20, 1812, and the act of Congress entitled 
 " An act in addition to an act entitled 'An act for the more convenient taking of affidavits 
 and bail m civil causes depending in the courts of the United States,'" passed March 1, 
 1817, and the act entitled "An act to establish the judicial courts of the United States," 
 passed September 24, 1789, did call and cause to be and personally appear before me, at my 
 office at 41 Chambers street, in the city of Xew York, in the said southern district of New 
 York, in the State aforesaid, Willard B. Farwell, to testify and the truth to say, on the part 
 and behalf of the libellants, in a certain suit or matter of controversy, now depending and 
 undetermined, in the district court of the United States for the southern district of New York, 
 at New York, wherein the United States is libellant against eight hundred cases of cham- 
 pagne wine, marked "M. & C." And the said Wiilard B. Farwell being about the age of 
 thirty-six years, and having been by me first cautioned and sworn to testify the truth, the 
 whole truth, and nothing but the truth, in the matter of controversy aforesaid, I did care- 
 fully examine the said Willard B. Farwell, and he did thereupon depose, testify, and say as 
 follows, viz: 
 
 I reside in San Francisco, California; expect to go there on the 11th of this month; the 
 time of my return here is uncertain. 
 
 Q. How long have you resided in San Francisco ; and what has been your occupation 
 there during the three years last past ? 
 
 A. I have been there sixteen years and over. I have been naval officer during the last 
 three years up to last August. 
 
 Q. Have you, during that time, spent any time away from this country ; and if so 
 where ( 
 
 A. I have. I went abroad last winter under the directions of the Treasury Department, 
 and spent some months in France and other parts of Europe, most of the time in Paris. 
 Q. Are you at present employed by the Treasury Department to obtain testimony to be 
 
222 
 
 NEW YORK CUSTOM-HOUSE. 
 
 used in the prosecution of tlris case ; and are you expecting 1 soon to go to Europe on tha 
 business part ? 
 
 A. 1 am employed as revenue agent, and shall go to Europe soon upon general bnoiPOM 
 lor tin; department in relation to frauds upon the revenue. I shall give attention to the 
 champagne cases among the husiness which includes this case. 
 
 Q. Wore you the informer against J. D. & M. Williams, of Boston, on account of import- 
 ations of champagne ? 
 
 A. I shall decline to answer. 
 
 (,>. Did you not say yesterday, under oath, in the case of Eugene Clicquot, that you were 
 the informer, and that you received therefrom $25,000 I 
 A. I did. 
 
 Q, Was that the truth ? 
 
 A. It was the truth. Yesterday I was asked questions in relation to the J. D. M. Wil- 
 liams matter while under cross-examination in the Eugene Clicquot suit, none of them hav- 
 ing any possible relevance to the suit then under consideration, hut only tending to scandal- 
 ize faithful puhlic officers of the Treasury Department, under the instructions of one of whom 
 I am acting as revenue agent, and apparently asked for no other purpose than that. 1 an- 
 swered all of those questions fully. Now, for the reasons that I have named, and because 
 questions in relation to the same matter have no possihle relation to this case, and can only 
 be asked for a similar motive, I shall decline to answer any other questions upon the J. D. 
 & M. Williams matter, or in relation thereto. 
 
 United States district court, southern district of New York. 
 
 The United States \ 
 rs. I 
 
 Eight Hundred Cases Champagne Wove, f 
 
 marked "M. & C." J 
 
 The United States ^ 
 vs. 
 
 Six Hundred Cases Champagne Wine, > 
 marked "E. C," Stehn & Wuffing, claim- 
 ants. 
 
 United States of America, ss r 
 
 I, George P. Betts, clerk of the district court of the United States for the southern district 
 of New York, do hereby certify that the preceding is a true extract from the testimony of 
 Willard B. Farwell, taken before me on motion of the counsel for the prosecution, now on 
 file in this court, and that said extract contains all the testimony relating to the subject 
 referred to therein. 
 
 In witness whereof, I have hereunto subscribed my name and caused the seal of said dis- 
 trict court to be hereto affixed, this 23d day of January, A. D. 1867, and of our independ- 
 ence the ninety -first. 
 
 [seal.] GEORGE F. BETTS, Clerk. 
 
 London, May 9, 1364. 
 
 Gentlemen : Will you kindly inform me what is the lowest price at Reims for your 
 champagne wines, such as would be suitable to the hotel trade of the Isthmus of Panama, 
 and the steamers between Panama and Peru and California ? I desire the lowest price for 
 wines with your brands or etiquettes ; such wine as American travellers are accustomed to in 
 the States would be preferable. Please give the price per bottle at Reims for orders of 100 
 to 500 baskets comptant. 
 
 I desire wines as near three francs per bottle as possible. The duty on such of my wines as 
 would have to be sent to California is fifty per cent. ; and wines costing four to five francs per 
 bottle at Reims would cost so much either at Colon or San Francisco as to deprive the pur- 
 chaser of his profit. I have been informed that the American customers allow wines to be 
 estimated or invoiced at the cost of manufacture, and not at the cost of purchasers in cham- 
 pagne ; if this is so, it would leave a better margin. 
 
 Would the price for such wines as you send to America be less for orders of 500 cases ? 
 
 Will you kiudly advise me in reply at your earliest convenience ? I ask in behalf of a 
 large hotel proprietor at Colon, with a view tp an extensive hotel and steamer trade. 
 Respectfully, 
 
 M. GIBBS, 
 
 Care of F. R. Morse, 67 Grace Church street, London. 
 
NEW YORK CUSTOM-HOUSE. 
 
 223 
 
 Reims, May 12, 1864. 
 
 SIR : We are in receipt of your favor of the 9th instant, by which you ask us our prices at 
 Reims for our wines suitable for the hotel trade of the Isthmus of Panama and the steamers 
 between Panama and Peru and California, and tell us that you act on behalf of a large hotel 
 proprietor at Colon. 
 
 As according to a contract made with our agent, Mr. Frederick De Barry, 52 Broad street, 
 New York, all transactions with the United States (California included) concerning our 
 champagne wines must be done by our agent himself, we have no right to do business 
 directly with your friend if he resides in the circumscription of the United States ; but our 
 agent at New York will certainly, with pleasure, give him all information concerning his 
 actual prices for our champagne wines either in bond or duty-paid. 
 
 As we can't find a town of the name of Colon, we would thank you for stating if this town 
 is situated in the United States territory, or where else ; for we have equally contracts with 
 houses in the southern America, and must therefore know, before all, if your friend is residing 
 in a State in which we have the right to do business from here. You are no doubt aware 
 that the Congress of the United States has of late augmented the duty on champagne wines 
 with fifty per cent, for sixty days — augmentation which no doubt will still be increased after 
 this time, and is therefore difficult to tell now which prices will be made by our New York 
 agent for the future. 
 
 In reply to your other questions concerning the declaration of wines, we beg to state that 
 all wines sold to customers in the United States before they leave Europe must be declared 
 in the invoices at the real price at which they are sold ; but that on consignments, the cur- 
 rent price at the manufacturer's home is allowed by the United States custom-house. 
 
 Our agent gives an allowance for orders of 500 dozen at once, and another for discount for 
 cash payments. 
 
 If your friend is residing out of the United. States, we would thank you for giving us the 
 exact address and residence, in order that we may be able to give him direct information or 
 communicate to our New York agent his inquiry, in order that he can do the necessary in 
 that respect, if he dwells in the United States. Your friend can be assured that he will be 
 served to his entire satisfaction by our New York agent, for our champagne wines are now the 
 favorite ones in the United States ; and notwithstanding the war, our transactions have 
 always been increasing. If you are authorized by your friend to do the intended business 
 for his aecount, we would thank you for giving us references at London or elsewhere. 
 
 Awaiting your. further views, we are, sir, yours, &c, 
 
 G. H. MUMM & Co. 
 
 M. Gibbs, Esq., care of F. R. Morse, Sfc, London. 
 
 London, May 18, 1864, 67 Grace Church street. 
 
 Gentlemen: Colon, sometimes called Aspinwall, is a city of considerable importance in 
 Central America. It is the Atlantic terminus of the only railway from the Atlantic to the 
 Pacific oceans ; is the depot of the great mail line of steamships, from New York to Califor- 
 nia, of the Royal Mail Steamship Company of England, and other lines. It is much crowded 
 with travelers, as you may suppose. 
 
 Some large houses of champagne have agents there, but none sell your wines. Colon or 
 Aspinwall is a free port and goods pay no duty there, but if they pass on to California, which 
 is one of the United States, they pay heavy duty. 
 
 Colon being neither in North or South America your agent in New York would perhaps 
 not object to a sale. 
 
 If you were to consign to the house of F. De Barry the wine intended for Mr. Hill, of 
 Colon, to be paid for at New Y'ork, so that the duty on such as would go to California could 
 be paid at New York, could the wine be invoiced at consignment rate, as mentioned in your 
 letter ? 
 
 All the purchases made will be for cash only ; but it is important to get the lowest price 
 and the lowest duty. 
 
 Please give your prices at Reims, with your sales and the consignment rates. 
 Y'our early reply will oblige, 
 Respectfully, 
 
 M. GIBBS. 
 
 G. H. Mumm & Co. 
 
 Reims, May 23, 1864. 
 
 Sm: Your favor of the 18th instant reached us only Saturday evening, 21st, too late for 
 this post ; we therefore can reply to it only to-day, Monday. 
 
 We have taken due notice of your explanations concerning Colon, which is perfectly 
 known to us under the name of Aspinwall, and beg to offer our best thanks for the commu- 
 nication of the address of your friend, Mr. Hill, of the said town, which will be transmitted 
 by next post to our New York agent, Mr. F. De Barry, who will, no doubt, (if he has no con- 
 
224 
 
 NEW YORK CUSTOM-HOUSE. 
 
 tracts concerning the said town with other houses,) give to Mr. TT ill all the communications 
 concerning prices and duty which this gentleman may require, in order to begin transactions 
 with him in <>ur wines. 
 
 Mr. F. De Barry is the brother of our partner, Mr. Win. De Barry, the writer of these 
 lines, and has the direction of all our transactions with the United States of America, and of 
 those which BIS going to the United .St;itcs ports, and we have no right to do business there 
 without his medium. 
 
 We cannot, of course, make another declaration of our wines than the real one, and will 
 never declare sold wines as consignments, tor we cannot act in contradiction with our dec- 
 laration made under oath, nor would we do anything against the custom-house laws of any 
 country. We can, therefore, by no means promise to your friend a lower duty than the real 
 one, which all the customers of Mr. F. De Hurry have to pay, if he (your liiend) desires to 
 receive the wines duty-paid, for Mr. 1 >e Harry act- on the same principles as we do, and all 
 declarations made by him or by us are quite faithful and according to the United States 
 laws, and will never be otherwise. 
 Respectfully, 
 
 G. II. MUMM & CO. 
 
 M. Cuius, Esq., London. 
 
 Ni.w York, January 12,1SG7. 
 THEODORE W. BAYAUD sworn aDd examined. 
 By the Chairman : 
 
 Q. What is your occupation and business in this city ? 
 A. I am an importer of wines. 
 
 Q. You have had some difficulty with the custom-house — what was that 
 about ? 
 
 A. It was about these champagne seizures. 
 
 Q. Do you buy these wines abroad, or are they sent to you on consignment ? 
 A. They are sent to me on consignment. 
 Q. On what terms are they sent ? 
 
 A. They are sent on commission, we making the advances. 
 Q. Had you any consignments seized 1 
 A. Yes. 
 Q. When? 
 
 A. At the time of the general seizure in 1S64. 
 Q. To what amount ? 
 
 A. To the amount of three hundred baskets, which we purposely had seized 
 to test this question. 
 
 Q. Are they still under seizure 1 
 
 A. We have given bonds, and taken them out. 
 
 Q. Were they seized for undervaluation ? 
 
 A. That was the ground of their seizure. 
 
 Q. Did you make any effort to settle this case ? 
 
 A. I called for a reappraisement, but the reappraisement raised our invoices 
 four and one-half per cent. 
 Q. Who were the appraisers ? 
 
 A. Mr. D. B. Sherman was the merchant appraiser, and the custom-house 
 appraiser was Mr. Dorrance. We had also some 3,300 baskets of champagne 
 of the same brand seized in San Francisco. They released these goods because 
 they were purchased by innocent men ; but there is some claim brought against 
 me of 8450,000. 
 
 Q. Who made that claim against you ? 
 
 A. The only manner in which the claim was presented was in the form of 
 being served with a notice, in which the marshal was requested to hold in hi3 
 custody the body of T. W. Bayaud for a claim of $450,000. I gave this to my 
 lawyer, and he went up there, and I have not heard of it since. 
 
 Q. Who was your lawyer 1 
 
 A. J. W. Griswold. 
 
NEW YORK CUSTOM-HOUSE 
 
 225 
 
 Q. Has there been any suggestion made to you how this $450,000 claim 
 could be adjusted ? 
 
 A. I was told within a few days that by paying this bond in gold, although 
 the bond is in currency, they might settle this thing. 
 Q. How much was the amount of the bond ? 
 
 A. Three thousand dollars. Bat where that suggestion originated I have 
 no idea. 
 
 Q. Have you any other information touching this matter to give us ? 
 
 A. The invoices on which the wines were entered were made at the request 
 of the appraisers. We had an understanding with the appraisers, and at their 
 suggestion entered the goods at the amount of valuation they placed on them ; 
 and they based the valuation upon the prices the goods brought here. 
 
 Q. Did that arrangement continue ? 
 
 A. It did, all the way through ; satisfactory to everybody, as far as we 
 knew. But, notwithstanding that the seizure was made, the question eame up 
 once or twice in reference to the valuation of the goods, and the appraisers 
 always said they were correctly invoiced. In J 860, or thereabouts, at San 
 Francisco, though the goods had been entered here and appraised as correct, 
 when they arrived there the appraisers there found they were undervalued. 
 The matter was submitted to the Secretary of the Treasury, and the excessive 
 duty paid at the time was refunded. They again fixed the valuation of the 
 goods, and the government came back to their previous tax, showing the goods 
 were correctly invoiced then. The best way to fix these rates is to take the 
 price the goods brinf, and deduct the expenses and a fair profit. Our wines 
 have not averaged a profit of ten per cent, from 1850 to the present day, even 
 if we had been paid all our accounts, and had not lost money by bad debts. 
 
 Q. Do you know anything of Mr. Montgomery Gibbs ? 
 
 A. The house on the other side had a correspondence with him under the 
 name of Hill. Knowing his reputation in former times when I knew him as a 
 sort of private banker and collector, and thinking I recognized his handwriting 
 under the signature of Amas Hill, I took the letter to his old office and com- 
 pared it with his letter-book, and found it was his handwriting. He wrote 
 from London, I think, to this house of Charles Heidsick, under this assumed 
 name, saying he was in business in Panama, and wanted to get the agency 
 there. 
 
 Q. Have you that letter signed Amos Hill ? 
 
 A. 1 h ive, and will produce it. He also assumed another name, the name of 
 somebody in Hamburg, and wrote from that city. 
 Q. What was the purport of that letter ? 
 
 A. It was of a similar character with the one from London. He represented 
 that he wanted Charles Heidsick's champagne, such as came to New York, and 
 was much appreciated there. I understand he succeeded in buying twenty-five 
 cases of the wine which came to New York, and though it cost more thau what 
 we can get it for, he offered it here for a lower price than what we sell it for. 
 The returns of that wine must have given them a loss of twenty-five per cent. 
 
 Q. You spoke of his reputation; did you know him here? 
 
 A. Yes. 
 
 Q. What sort of man was he ? 
 
 A. His general reputation is about as low as you can find a man of respectable 
 standing in. 
 
 Q. What was his character and reputation for integrity ? 
 A. He was a perfectly unreliable man, not to say worse. 
 Q. You say he was a private banker ? 
 
 A. Yes, a private banker and collector of accounts. He undertook to collect 
 accounts for me, for which I never got any return. Whether he collected them 
 or not, I cannot say. 
 
 H. Rep. Com. 30 15 
 
226 
 
 NEW YOKK CUSTOM- HOUSE. 
 
 New York, January 18, 1867. 
 THEODORE VV. BATAUD recalled and examiner]. 
 
 By the Chairman : 
 Q. Are you acquainted with the handwriting of these letters \ 
 (Three letters, dated respectively, Liverpool, April 20, 1864, London, May 8, 
 1864, and Antwerp, December 7, 1864, and signed, the first, Amos Hill, care 
 of Edwards's Hotel, George street, Hanover square, London; the second, signed 
 Amos Hill, care of Freeman Et. Morse, esq., 67 Grace Church street, London, 
 and the third, signed Ames Hill, of Aspinwall and Panama, wen- here handed 
 to the witness.) 
 
 A. I am acquainted with one of them, particularly — the one dated Liverpool, 
 April 26, 1S64, and signed Aim s Hill. 
 Q. Whose writing is that ? 
 
 A. Montgomev Gibbs's, to the best of my belief. 
 Q. You are acquainted with his handwriting? 
 
 A. Yes; I have seen it frequently. I have compared this letter with the. 
 letter in his letter-book and find the handwriting to be precisely the same. I 
 am well acquainted with tin handwriting of this letter 1 have spoken of; the 
 others 1 cannot .-ay. But they all emanated from the same man, because it is a 
 continuation of the same correspondence. 
 
 Q. These letters were Bent to Charles Hcidsick, at Reims ? 
 
 A. Yes 
 
 Q. How did you get them ? 
 
 A. They were sent to us; we are their agents here. 
 
 Q. The paper which you hold in your hand you know and believe to be a 
 copy of the original affidavit made by Richard YV. Teller, formerly assistant 
 United States appraiser? 
 
 A. Yes. 1 have had the original in my possession, and I think I have it now, 
 but I am not positive. It might be among my records. 
 
 New York, January 18, 1867. 
 WM. P. GOUGHTItEY sworn and examined. 
 
 By the Chairman : 
 
 Q. Did you make copies of the correspondence between Montgomery Gibbs 
 and G. H. Murnm, of Reims, and between Amos Hill (Montgomery Gibbs) and 
 Charles Heidsick, of Reims 1 
 
 A. I did. 
 
 Q. Did you also copy the affidavit of Richard H. Teller, formerly assistant 
 United States appraiser in the New York custom-house 1 
 A. I did. 
 
 Q. Are they true copies ? 
 A. They are. 
 
 Witness produced copies of the correspondence, which are annexed, hereto as 
 follows : 
 
 Liverpool, April 26, 1864. 
 
 Sir : Will you favor me with a list of your wines suitable for the hotel trade of the isthmus 
 of Panama, and the steamship trade on the Pacific, and your lowest cash price for orders of 
 not less than 500 packages. 
 
 The bulk of my trade is American, and I prefer the same wines which are known and 
 esteemed in the States, provided they will bear the warm climate of Panama. 
 
NEW YORK CUSTOM-HOUSE. 
 
 227 
 
 Please give me a list of the qualities, brands, and cash prices of wines suitable for the 
 trade indicated, so that it may reach me at London. It is my purpose to visit Champagne, 
 if I can arrange there more advantageously than in London. 
 Respectfully, 
 
 AMOS HILL, 
 
 Care Edwards's Hotel, George Street, Hanover Square, London. 
 Charles Heidsick, Esq., Reims. 
 
 Reims, April 28, 1834. 
 
 Sir : We are. in receipt of your esteemed favor from the 26th instant. The wines we sell 
 in the United States are of only one quality, and this quality we will sell to you for $42 per 
 basket or box of 12 quarts ; for $47 per basket or box of 24 pints, free of charges whatever, 
 on board of ship in any French port. Discount for cash 3 per cent. 
 
 The cheapest way is via Dunkirk for London. We are sure the expenses between Havre 
 and Liverpool are rather high. 
 
 Enclosed you will find our label, so well known to any American, and we think you shall 
 do good to let us suppress on the label the name of our American agents ; then we will put 
 instead the following mention : " Direct importation by Mr. Amos Hill, Panama." 
 
 In case you should agree with us, we shall print the labels. 
 
 On account of our very large trade with Australia, and as our Mr. Heidsick remained some 
 years in Louisiana and Alabama, he has got a perfect experience about corking, packing, 
 and treating the champagne wines for warm climates. Our wines will stand the Panama 
 climate better than any on this account. 
 
 We think you had better not make large purchases at once, but secure a regular way of 
 shipping, either in London or Liverpool, or even New York, if any regular line of ships exists. 
 And suppose you will agree to our prices, we should direct you monthly 50,100, 150 packages. 
 You will have your market supplied with fresh importations, and no chance for the wine of 
 being stored long time before consumption. It is better to use boxes instead of baskets on 
 account of the climate. It makes no difference in the price, if you order at once 50 packages 
 or 500 packages, as the quotations are those for our regular customers, some of them ordering 
 500 packages monthly. 
 
 In regard to-payment, you could open us a credit in France or England, authorizing us to 
 draw at short sight, by remittance to your banker of the documents like bill of lading and 
 invoice, short discount. 
 
 If you should visit Champagne, we shall be pleased to make your acquaintance, and to 
 put ourselves entirely to your disposal. 
 
 Awaiting your favorable answer, we remain, dear sir, yours, very truly, 
 
 CHARLES HEIDSICK & CO. 
 
 Amos Hill, Esq., 
 
 Care Edwards's Hotel, George Street, Hanover Square, London. 
 
 London, May 8, 1864. 
 
 Sir : I have received your letter of April 28th, for which I am much obliged. 
 
 I have so many offers here of wines that I hardly know what final arrangements I shall 
 make, but think I shall, late in the month, visit Reims, when I shall do myself the honor to 
 call upon you. 
 
 I have wished a wine at 2$ francs to 3 francs per bottle at the cellars, and had supposed I 
 could buy a good wine for that price. It being necessary to send some of my wines to 
 California, I have to pay 50 per cent, on the amount of the invoice as customs duties. In 
 this case your wines would cost 3^ francs and If francs for customs, which would make the 
 cost, exclusive of freight and charges, 5J francs per bottle, which would not give me the 
 profit I desire. 
 
 Could you furnish any wine with your brand for say 2| francs per bottle at the cellar ? 
 I am told that the government of the United States allows wines to be passed in the custom- 
 house at the cost price to manufacture, and not at the price of the market at Champagne. I 
 shall inquire of this of the minister. Perhaps you can inform me ? 
 
 Thanking you again for your courtesy, and expecting to see you, respectfully, 
 
 AMOS HILL, 
 
 Care Freeman R. Morse, Esq., No. 67 Grace Church Street, London. 
 
 C. Heidsick, Esq. 
 
 Antwerp, December 7, 1864. 
 Gentlemen : Referring again to your esteemed favor of April 28, in reply to my letter of 
 April 26, from Liverpool, in relation to my proposed purchases of wine for the Isthmus of 
 Panama, I beg to say that absence and a partial change of plans have prevented an earlier 
 reply. 
 
228 
 
 NEW YORK CUSTOM- HOUSE. 
 
 I left London hoping to be able, to go to Champagne, but frar I shall not be able to do so, 
 having important shipim mis to attend to at Bordeaux. 
 
 I conclude to do as you kindly advised — order small shipments monthly. You may, 
 therefore, prepare at once the first shipment of '27> baskets, (I", quarts, 10 pints,) using your 
 usual label, without agents' names, prices to be as per your favor of April 28, 1864. 
 
 Please notify me at the Hotel Bellevue, Ilruxellcs, where 1 shall stop for a day or two 
 on my return from Bordeaux, of the amount I shall remit, and 1 will remit you a Loudon 
 banker's bill on Paris for the amount. I will, with the remittance, give full shipping direc- 
 tions. I desire packages marked A. [H,j Aspinwall, and the first two shipments will be 
 sent by the, Royal Mail Steamship Company's steamers from Southampton, riu II.i . m . 
 
 May I not hope that, if my orders continue, you will increase the discount for cash ? One 
 manufacturer offers me ten per cent, dhcmnt from his wholesale trade prices. Will juices 
 be likely to be lower this year ? 
 
 I deem it just to you to say that I have ordered twenty-live cases per month from one of 
 your neighbors desiring the Dame. I may conclude to drop these orders and increase yours, 
 if you make it for my interest. 
 
 I repeat, address me at Hotel Bellevue, Rruxelles, stating amount due lor first shipment. 
 Before shipment I will remit from London, and will arrange for a future credit at 1'aris. to 
 cover future orders. 
 Respectfully, 
 
 AMOS HILL, 
 Of Atpinirall and Panama. 
 
 Charles Heidsick & Co. 
 
 London, May 9, 1864. 
 
 Gentlemen s Will you kindly inform me what is the lowest price at Reims for your 
 champagne wines, such as would be suitable to the hotel trade of the Isthmus of Panama, 
 and the steamers between Panama and Peru and California? I desire the lowest prices for 
 wines with your brands or etiquettes, such wines as Americau travellers are accustomed to 
 in the States would be preferable. Please give me the price per bottle at Reims for orders of 
 one hundred to five hundred baskets comptunt. 
 
 I desire wines as near three francs per bottle as possible. The duty on such of my wines 
 as would have to be sent to California is fifty per cent., and wines costing four to five franco 
 per bottle at Reims would cost so much, either at Colon or at San Francisco, as to deprive the 
 purchaser of a fair profit. I have been informed that the American customs allow wines to 
 be estimated or invoiced at the cost of manufacture, and not at the cost to purchasers, in 
 Champagne. If this is so, it would leave a better margin. 
 
 Would the price for such wines as you send to America be less for orders of five hundred 
 cases ? Will you kindly advise me in reply at your earliest convenience ? I act in behalf of 
 a largo hotel proprietor at Colon, with a view to an extensive hotel and steamer trade. 
 Respectfully, 
 
 M. GIBBS, 
 
 Care of F. R. Morse. No. 67 Grace Church Street, London. 
 
 G. H. Mumm & Co., Reims. 
 
 Reims, May 12, 1864. 
 
 Sir : We are in receipt of your favor of 9th instant, by which you ask us our prices at 
 Reims for our wines, suitable to the hotel trade of the Isthmus of Panama and the steamers 
 between Panama and Peru and California, and tell us that you act on behalf of a large hotel 
 proprietor at Colon. 
 
 As according to a contract made with our agent, Mr. Frederick De Barry, No. 52 Broad 
 street, New York, all transactions with the United States, California included, concerning 
 our champagne wines, must be done by our agent himself. We have no right to do business 
 directly with your friend if he resides in the circumscription of tte United States, but our 
 agent at New York will certainly, with pleasure, give him all information concerning the 
 actual prices for our champagne wines, either in bond or duty paid. 
 
 As we can't find a town of the name of Colon, we would thank you for stating if this town 
 is situated in the United States territory, or where else, for we have equally contracts with 
 houses in the southern America, and must therefore know, before all, if your friend is re- 
 siding in a State in which we have the right to do business from here. 
 
 You are, no doubt, aware that the Congress of the United States has of late augmented 
 the duty on champagne wines with fifty per cent, for sixty days — augmentation which, no 
 doubt, will still be increased after this time, and it is therefore difficult to tell now which prices 
 will be made by our New York agent for the future. 
 
 In reply to your other questions concerning the declaration of wines, we beg to state that 
 all wines sold to customers in the United States before they leave Europe must be declared 
 in the invoices at the real price at which they are sold, but that on consignments the current 
 price at the manufacturer's home is allowed by the United States custom-house. 
 
NEW YORK CUSTOM-nOUSE. 
 
 229 
 
 Our agent gives an allowance for orders of 500 dozen at once, and another for discount for 
 cash payments. 
 
 If your friend is residing out of the United States, we would thank you for giving us his 
 exact address and residence, in order that we may be able to give him direct information, or 
 communicate to our New York agent his inquiry, in order that he can do the necessary in 
 that respect if he dwells in the United States. Your friend can be assured that he will be 
 served to his entire satisfaction by our New York agent, for our champagne wines are now 
 the favorite ones in the United States ; and notwithstanding the war, our transactions have 
 always been increasing. 
 
 If you are authorized by your friend to do the intended business for his account, we would 
 thank you for giving us references at London or elsewhere. 
 Awaiting your further news, we are, sir, yours, &c, 
 
 G. H. MUMM & CO. 
 
 M. GIBBS, Esq.. Care of F. R. Morse. &?c, London. 
 
 67 Grace Church Street, 
 
 London, May 18, 1664. 
 
 Gentlemen : Colon, sometimes called Aspinwall, is a city of considerable importance in 
 Central America. It is the Atlantic terminus of the only railway from the Atlantic to the 
 Pacific ocean ; is the depot of the great mail line of steamships from Now York to California, 
 of the Royal Mail Steamship Company of England, and other lines. 
 
 It is much crowded with travellers, as you may suppose. Some large houses of champagne 
 have their agents there, but none sell your wines. Colon, or Aspinwall, is a free port, and 
 goods pay no duty there ; but if they pass on to California, which is one of the United States, 
 they pay heavy duties. 
 
 Colon being neither in North nor South America, your agent in New York would not, per- 
 haps, object to a sale. If you were to consign to the house of F. De Bary the wine intended 
 for Mr. Hill, of Colon, to be paid for at New York, so that the duty on such as would go to 
 California could be paid at New York, could the wine be invoiced at the consignment rate, as 
 mentioned in your letter ? 
 
 All the purchases made will be for cash only, but it is important to get the lowest price 
 and the lowest' duty. 
 
 Please give your prices at Reims, with your sales rates and the consignment rates. 
 Your earlv reply will oblige, respectfully, 
 
 M. GIBBS. 
 
 Care F. R. Morse. 67 Grace Church street. London. 
 
 G. H. MUMBfl & Co. 
 
 Reims, May 23, 1864. 
 
 Sir : Your favor of 16th instant reached us only Saturday evening. (21st,) too late for the 
 post; we therefore can reply to it only to-day, (Monday.) 
 
 We have taken due notice of your explanation concerning Colon, which is perfectly known 
 to us under the name of Aspinwall, and beg to agree our best thanks for the communication 
 of the address of your friend, Mr. Hill, of the said town, which will be transmitted by next 
 post to our New r York agent, Mr. F. De Barry, who will, no doubt, if he has no contracts con- 
 cerning the said town with other houses, give to Mr. Hill all the communications concerning 
 prices and duty which this gentleman may require, in order to begin transactions with him 
 in our wines. 
 
 Mr. F. De Barry, at New York, is the brother of our partner, Mr. Wm. De Barry, the writer 
 of these lines, and has the direction of all our transactions with the United States of America, 
 and of all those which are going through United States ports, and we have no right to do 
 business there without his medium. 
 
 We can't, of course, make another declaration of our w r ines as the real one, and will never 
 declare sold wines as consignments, for we can't act in contradiction with our declarations 
 made under oath, nor Avould we do anything against the custom-house laws of any country. 
 We can therefore by no means promise to your friend a lower duty as the real one, which 
 all the customers of Mr. F. De Barry have to pay, if he (your friend) desires to receive the 
 wines duty paid; for Mr. De Barry acts on the same principle as we do, and all declarations 
 made by him or by us are quite faithful and according to the United States laws, and will 
 never be otherwise. 
 
 We remain, sir, yours, respectfully, 
 
 G. H. MUMM & CO. 
 
 M. GIBBS, Esq., London. 
 
 Care F. R. Morse, 67 Grace Church Street. 
 
230 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Mr. RlCHARP H. Teller, formerly assistant I 'nil* .] States appraiser in New York cus- 
 tom-house, now of firm of I>. .Jackson A Co., corner Thirty-third street and Eleventh avenue, 
 New York. 
 
 About tlie beginning of year I r- 17, as nearly as I cm now remember, Messrs. hYnauld tV 
 Francois railed upon the appraisers in the New York custom-house to fix a value at which 
 they might enter their champagne, the Piper Heidsick, under the then new tariff of 1846. 
 Tinder the former tariff the duty w as specific, and little attention had been paid to the valua- 
 tion of champagne wine. Mr. George W. l'omeroy, who was then head appraiser, at once 
 entered into an investigation of the matter. It was at the time well known to the appraisers 
 that the various brands of champagne shipped to the United States had no actual market 
 prices in Reims, because (hey were manufactured entirely tot shipment to the United States, 
 and were not regular articles of sale in Reims; and it was for this reason that Messrs. 
 Renauld cV: Francois were obliged to consult the custom-house appraisers. Mr. l'omeroy 
 obtained the best information available, and also examined the amounts and account sales of 
 Renauld &. Francois, and he consulted with the other appraisers. A price was finally fixed 
 by them, mainly by taking the net proceeds of tie- wine as sold in New York, from which 
 they allowed what was considered a moderate shippers' profit, >1 or si <'."> a basket, as nearly 
 as 1 recollect. I was then appraiser's clerk, and knew of all the proceedings in the matter. 
 I assisted Mr. l'omeroy in going over the calculations by which the price was finally deter- 
 mined, and subsequently was ordered to pass all invoices of that wine at the price fixed. 
 The price then fixed has, 1 believe, been continued in all the invoices of the I'iper Heidsick 
 wine down to the present time Alter the price was fixed the I'iper Heidsick champagne 
 became, to a gn at degree, the standard by which Ave determined the value of other kinds of 
 champagne. 
 
 A few years after the above appraisement was made J was appointed assistant United 
 States appraiser, and had given me the whole charge of passing the various champagne in- 
 voices. I was assisted in this duty by Henry Tolei and A. 15. danin. w ho were w hat we 
 termed tasters. I continued in charge of this dot v till 1 left the custom-house, on November 
 11, 1863. 
 
 I think it w as aboni six years after the above appraisement that the importation of the Charles 
 Heidsick wine commenced at New York. It was a new brand of wine, and we carefully 
 examined it in order to correctly appraise its value In so doing we compared it with the 
 Piper Heidsick. At first we allowed the w ine to be entered at and "J'J francs, bottles and 
 packages additional ; but a year or so later w e again took up the consideration of its value, 
 and satisfied ourselves that the quality of the w ine was a little better, and we. therefore, de- 
 termined to advance its price. We settled on 2.50 francs per bottle, at which price it has 
 ever since been regularly entered; the charges for bottles, &C, (which are subject to occa- 
 sional charges,) being added to the price named, which is for the wine alone. I remember 
 that Mr. T. YV. Bayaud, w hose firm were agents for the Charles Heidsick wine, complained 
 that the price of 2.50 francs per bottle was really above w hat the wiue was worth in Reims. 
 
 The appraisers in both the foregoing cases fixed the price entirely upon their own informa- 
 tion and judgment, independently of the importers, who were compelled to accept the 
 appraiser's decision. 
 
 July 7, 1865, 
 
 Mr. Bexj. B. SlIERMAN, formerly a merchant, w as selected by the government (as a mer- 
 chant appraiser and expert) one of the appraisers to try appeals from decisions of the ap- 
 praisers of the New York custom-house. 
 
 The evidence of Mr. Sherman, before a committee of Congress, upon the affairs of the 
 New York custom-house, was published in the New York World of March 29, 1865. Among 
 other things, he says, in reply to the question "Have you any means of knowing the actual 
 cost of this wine (champagne) where it is produced ?" " The first quality costs at the place of 
 manufacture 2j$, francs per bottle ; the second quality francs per bottle : and the third 
 quality francs per bottle. This is the cost per bottle before it is labelled and put into 
 baskets, the expense of w hich is 2^ francs per basket. Much of this wine in its raw state 
 is bought for 30 francs per 40 gallons." 
 
 Q. " What does this wine sell for after it has been imported into this country and paid a 
 duty of 50 per cent, ad valorem ?" 
 
 A. " The first quality sells at $16 in gold per basket; the second quality at $13, and the 
 third at $11 ; ' 
 
 Note. — The Charles Heidsick wine, under the 50 per cent, ad valorem duty, sold at just 
 about $13, gold. It is a second quality wine, referred to above as costing 1 f£ francs per 
 bottle. 
 
NEW YORK CUSTOM-HOUSE. 
 
 231 
 
 Astor House, New York, January 31, 1867. 
 L. E. CHITTENDEN, being duly sworn, testifies as follows. 
 
 By the Chairman : 
 Q. Were yon connected with the public service ? 
 A. Yes, sir. 
 Q. Tn what capacity ? 
 A. Register of the Treasury. 
 
 Q. Will you state to the committee any particulars of interviews between 
 Messrs. Jordan, Barney, and Han scorn in this city, wherein the subject-matter 
 of compromising the claims of Thomas W. Bayaud and others was under dis- 
 cussion. State what you recollect of the particulars of that interview, or any 
 matters pertaining to that subject. 
 
 A. Shortly after I resigned my office in the treasury, which was about Sep- 
 tember, 1864, I came to this city to reside, at the Hoffman House ; I was there 
 applied to by Charles Heidsick, and a member of the firm in question ; I cannot 
 now recollect his name, and asked if I would accept a retainer as their counsel 
 in the matter of the seizure of some champagne. I told them that would de- 
 pend materially upon what was wanted of me ; if the services required were 
 legal services, that I had no objection to being retained, but if they related to 
 the outside management of their case, I thought that I could not be of any ser- 
 vice to them, and did not wish to engage in it, and told them I would look into 
 the matter far enough to see, and give them an answer. I accordingly exam- 
 ined the case and familiarized myself with the facts upon which the seizure was 
 predicated as well as I could, and consulted with some gentlemen of the bar 
 here who had their case in charge, and finally upon it being made pretty clear 
 to me that sueh action as they had taken was induced by officers of the custom- 
 house, and apparently taken in good faith, I consented to undertake for them 
 some things about the management of their case. Very early in the examina- 
 tion, the subject of a compromise with the government was suggested. It was 
 stated that preliminary attempts had been made to compromise it. I was very 
 strongly impressed with the opinion that no power of compromise existed with the 
 government officers, and took this view of it, that if a fraud had been committed 
 upon the revenue ipso facto, forfeiting their goods, and that, in short, the offi- 
 cers of the government had no power to settle an offence against the laws than 
 ordinarv officers charged with criminal transactions had to settle theirs. But I 
 was informed that I was all wrong about that, that such cases had been com- 
 promised, and that it was quite practicable to compromise this. I arranged to 
 have an interview with the parties who were supposed to have this power to 
 arrange these matters. I went to see Mr. Draper, who was then collector. He 
 apparently knew nothing about it, but he informed me that all these legal ques- 
 tions and the management of those cases was committed to an officer by the 
 name of Hanscom, and that Mr. Jordan, the Solicitor of the Treasiuy, also had 
 something to do with the cases. Mr. Jordan had been long an acquaintance of 
 mine, and not very long after this, upon learning that he was in the city and at 
 the Fifth Avenue Hotel, I went there to him to talk up this case with him, 
 and to see what could be done about it. The first object I had was to ascertain 
 from whence the legal power to compromise those cases was derived. I there 
 found Mr. Barney and Mr. Hanscom — the meeting beiug entirely accidental on 
 my part with Hanscom or Barney ; a good deal of conversation ensued in regard 
 to these particular claims. This was late in the year 1864, or early in the year 
 1865, and it is utterly impossible for me to detail that conversation accurately, 
 or the part that each one took. 
 
 Q. Are you able to give the impression 1 
 
 A. I will say that Mr. Jordan was not prominent in the conversation at all . 
 
232 
 
 NEW YORK CUSTOM-HOUSE. 
 
 I do not know that I can say that be assented to the view that was taken of 
 this case by Mr. Barney and Mr. Ilanscom. The fact was the statement was 
 prominently put forward, specially by Mr. Hanscom, and, I think, by Mr. Bar- 
 ney, that the interests of the officers in this matter moat be protected. This 
 was as much a legitimate subject of protection for them as the pro!, ction of their 
 salaries. I made a good many efforts to get down to the discussion of the legal 
 merits of the case, and of the actual questions of fact which it presented, but 1 
 was unable to procure any special attention to those considerations. The im- 
 pression created on my mind was thai the case could be compromised if the in- 
 terests of the officers could be taken care Oft- — otherwise it could not; but the 
 impression was so strong, and it was so utterly opposed to my ideas of what 
 should be done with such a case, that I dropped it entirely, and did not go any 
 further with it, and would ii<»| pretend to make a legal compromise with the 
 government in that way. I told them that if that was the case I could only 
 say to my clients I could not be of any sort of service to them, and I did say so 
 to them the next time I saw them, and left the case. 
 
 Q. Who seemed to have the interests involved there — you say the officers? 
 
 A. That was not discussed at all. The fact was directly put forth that in 
 some way the officers had such a large pecuniary interest in this in common 
 with other cases, and that that interest must be protected. 
 
 Q. I refer particularly now whether tie- solicitor, as present and advising, 
 was one who was counted in the interests? 
 
 A. I should not think I was warranted in affirmatively drawing that conclu- 
 sion from anything he said. 
 
 Q. 1 want to know the impression made upon your mind as to the attitude 
 that Mr. Jordan stood in that matter, whether he accepted or acquiesced in 
 these results, and the directions that were put forth why certain conclusions 
 should be reached ? 
 
 A. Mr. Jordan said but very little about it. 
 
 Q. Did he interpose any objection to the view taken, that the interests of the 
 officers, if they could be carried forth a compromise could be effected ? 
 A. No, sir, not that I am aware of. 
 
 Q. Then, did he not acquiesce in the view that was put forth there by silence, 
 if not in words ? 
 
 A. This idea of the interests of the officers and their protection was openly 
 spoken of and put forward. Mr. Jordan was present and said nothing in con- 
 travention. I cannot say further than that. In fact, my object had been to see 
 Mr. Jordan, and Mr. Hanscom rather took charge of the business of the con- 
 versation instead of Mr. Jordan ; that was the fact about it. 
 
 Q. If Mr. Jordan had been a recognized participant in the officers' distribution 
 would he naturally have taken a different position to what he did ? 
 
 A. No, sir, I do not know that he would. 
 
 Q. Was the amount at all indicated of the seizures or the interest to be ef- 
 fected 1 I do not mean interest individually ; I mean the gross amount of the 
 seizure that would be effected by this compromise, or the conclusions then 
 reached. 
 
 A. No, sir ; the seizure in these particular cases was well known on both 
 sides, as well as the value of the property seized. 
 
 Q. What was the amount, as you now understand it, involved in the case or 
 cases ? 
 
 A. I cannot now recall it; it was a very large amount — it was all the cham- 
 pagne which the parties had, that had not been withdrawn from the custom- 
 house — I mean on the Atlantic coast and California. It was stated in that con- 
 versation that one of these cases had been settled. " Settled" was the term 
 used, and that one of the importing agents had paid a large sum of money to 
 settle the case. I have in my mind a sum of something like $30,000. I know 
 
NEW YORK CUSTOM-HOUSE. 
 
 233 
 
 that I afterwards instituted some inquiry with a view of ascertaining whether 
 that money had ever gone into the treasury, but could find no account of it. 
 
 Q. Did you ever have, at Washington, any interviews or consultations with 
 Mr. Jordan on this subject 1 
 
 A. No, sir ; not after this interview. It strikes me I did see Mr. Jordan in 
 Washington previous to this, and it was arranged that we were to have an in- 
 terview in this city in relation to it, which was the interview I have spoken of. 
 This terminated my connection with the matter. 
 
 Q. You say after that interview you withdrew from the case, feeling that you 
 could not benefit your clients. Will you state with more particularity to the 
 committee why you came to that conclusion, and did withdraw from any further 
 assistance to your clients ? 
 
 A. I supposed if the case could be adjusted by an examination of its merits, 
 and by giving proper weight to the consideration that whatever these parties 
 had been induced to do, contrary to the law, they had been induced to do by 
 the action of the officers of the government, that I could be of service to my 
 clients in that adjustment, but if the case was to be disposed of by buying off or 
 getting rid of private interests, that was a business I did not understand, and 
 was not disposed to engage in. 
 
 Q. And hence you withdrew 1 
 
 A. Certainly. 
 
 Q. What is your opinion or view of the business of the seizure bureau as 
 facts in particular have come before you, so far as the government is affected, 
 and so far as the commerce and individual rights are affected by it ? I mean 
 whether it is a fair method of conducting it. 
 
 A. I wish to except from my answer the district attorney's office, past 
 and present, and all parties connected with it, and to say that a great many 
 facts have come to my knowledge which have created the impression that I am 
 about to state, that does not amount to legal evidence. I have been often ap- 
 plied to to attempt the adjustment of cases at that bureau and the custom-house, 
 and have uniformly, with the exception above stated, declined to have anything 
 to do with them. I have done so because of the impression which these facts 
 have produced, that in order to succeed in such adjustments it was necessary to 
 employ parties or certain lawyers having intimate relations of some character 
 with the officers of that bureau, and that it would be of little use for a stranger to 
 it, having nothing but his case and its strength to use, to attempt an arrange- 
 ment of ciich matters. In short, I felt that I could be of no use to the parties 
 who had an interest there. 
 
 Q. What is the impression of the merchants as far as you know ? 
 
 A. Such is the impression of such merchants as I know. 
 
 New York, January 12, 1867. 
 PETER H. REYNAULD sworn and examined. 
 
 By the Chairman : 
 Q. What is your business 1 
 
 A. I am a member of the firm of Reynauld, Francois & Co. 
 Q. Are you in the importing business 1 
 A. Yes. 
 
 Q. What kind of goods do you import 1 
 
 A. Champagne wines and cigars. 
 
 Q. Where do you import your champagne from ? 
 
 A. From the house of Piper & Co., of Reims. 
 
 Q. Have you had any difficulties in entering ycur goods here ? 
 
234 
 
 NEW YORK CUSTOM -HOUSE. 
 
 A. Not until about two years ago. 
 Q. What was that difficulty ? 
 
 A. I had an invoice of a thousand baskets of champagne wi* d at the cus- 
 tom-house, although it was made out in the usual form. 
 Q. What was the valuation in the invoice ? 
 A. About thirty-six francs the basket. 
 
 Q. How had you been accustomed to enter the same wines before ? 
 A. At the same rate as before, except that the transportation charges were 
 taken oft" by law. 
 
 Q. The entry was the same with this exception ? 
 
 A. Yes; that change had taken place in the fall of 1863; but this was the 
 same as the previous invoices. The valuation had been put up by agreement 
 with the custom-house appraisers, and to avoid any difficulty whatever we said 
 put a higher valuation if necessary, rather than have any obstacle or difficulty 
 about it; and we entered our invoices in conformity with the valuation they 
 made under these suggestions. I considered they were Letter able to say what 
 the valuation should be than ourselves, because we did not know much about it, 
 and they had constant information about it. 
 
 Q. Were these goods purchased by you or sent to you on consignment | 
 
 A. They were sent on consignment. 
 
 Q. You sell for their account, subject to deduction of charges, freight, ex- 
 change, duties, and commission, &c. ? 
 A. Yes. 
 
 Q. Was the consignment to be subject to your approval — that is, suppose 
 you had a consignment that did not suit you, what were you to do ? 
 
 A. There was no agreement made about that. We had to sell it for them, 
 and the result of the sal*' was for the owners. 
 
 Q. In case there was breakage ? 
 
 A. In that case of course it produced less ; but that was their loss. In case of 
 breakage there was a smaller quantity, and of course it produced less. 
 Q. What was the amount seized ? 
 
 A. One thousand baskets, valued at about thirty-six thousand or thirty-seven 
 thousand francs. 
 
 New York, January 12, 1867 
 
 GEORGE BARTELS sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you a member of the same firm that last witness is I 
 A. Yes. 
 
 Q. Can you give the committee any data of the amount of your transactions 
 per annum 1 
 
 A. They varied a great deal ; on account of the war the sales fell off consid- 
 erably, but now they are on the increase again. We sold before the war as 
 much as fifty thousand baskets a year. During the war it fell as low as seven- 
 teen or eighteen thousand baskets, but it is now getting up again. 
 
 Q. Do you purchase or receive on consignment ? 
 
 A. We receive it on consignment. 
 
 Q. What is the wine you sell called ? 
 
 A. Piper Heidsick. 
 
 Q. You receive invariably on commission ? 
 
 A. Y x es. We have no interest in the consignment except our commission. 
 Q. It was on the invoices sent you by Piper & Co. you made the entries in 
 the custom-house ? 
 
NEW YOKK CUSTOM-HOUSE. 
 
 235 
 
 A. Just precisely the same as they came to us. 
 Q. The house fixed the valuation 1 
 
 A. They sent the invoices, and we entered them in conformity with a previous 
 agreement with the custom-house. 
 
 Q. You heard the testimony of the previous witness. What followed after the 
 seizure ? 
 
 A. We employed counsel and called for a reappraisement. 
 
 Q. Who did you employ as counsel 1 
 
 A. Webster and Craig. 
 
 Q. Who told you to go to them 1 
 
 A. Francis B. Cutting recommended me to go to them. 
 Q. What was the next step 1 
 
 A. The appraisement was called for. And although the seizure was made in 
 May, 1864, yet it was only by the end of August the reappraisement was com- 
 pleted. The person whose goods are seized has no control over the reappraise- 
 ment at all, but must allow them their own way. They first selected as appraiser 
 a gentleman who was a button merchant, but we objected to it, and said if they 
 would appoint such a man as that we would pa} r no attention to it. 
 
 Q. Who selected this gentleman ? 
 
 A. Mr. Barney, the collector. They afterwards asked Moses Taylor to act, 
 but he declined ; and then they got Mr. Sherman for merchant appraiser, and 
 the custom-house appraiser was Mr Dorrance. We had a conference, and I 
 handed in to them a statement I had received from my friends on the other side. 
 Mr. Sherman was unable to find what he understood to be the market value on 
 the other side, and they finally concluded to make an appraisement as well as 
 they could according to the selling price of the goods here, and they advanced 
 the prices of ours, I believe, six per cent, or six per cent, and a fraction. We 
 then thought the' thing would be ended and the wines released, but they held on 
 to the seizure. Of course we could not help ourselves, and as the wines would 
 be injured if kept longer in the custom-house, we had to give bonds for them, 
 and take them out. We then found some of it had become leaky, and we had 
 to sell it at a reduction. The valuation was then reduced, for I insisted upon it. 
 
 Q. How did it finally terminate ? 
 
 A. It is in the same condition yet. We have been taking testimony on the 
 other side, and we were in hopes of having the matter tried in December, but the 
 custom-house put us off. 
 
 Q. On what ground ? 
 
 A. On the ground that other cases of a similar nature were to be tried else- 
 where — in San Francisco, I believe, and that consequently their most important 
 witnesses were wanting there. The case was argued in court, and Judge Bene- 
 dict decided in favor of postponing the trial, and it has been put off until March. 
 
 Q. Do you know anything of Montgomery Gibbs in connection with this matter ? 
 
 A. I don't know him personally, but I heard a great deal about him. It seems 
 he found out that by going into this thing a good deal of money could be made 
 out of it, either here or in Europe. And if the papers I have seen be correct, he 
 made a report to Congress, on which that body made the present law, giving the 
 government authority to send agents travelling to where the goods came from, 
 and claiming from the consignees goods that had been received by them, and had 
 been undervalued, and going back five years to search for such cases. Gibbs 
 then went to Europe, and found out a man who was broken down in business, and 
 knew a little about wine matters generally, and he sent him to work. But it 
 seems this plan did not work well, and Gibbs, for some reason or another, got 
 separated from him, and then Mr. Farwel stepped up. 
 
 Q. How did it go on under him ? 
 
 A. Farwell then employed this man, and there can be no doubt in the mind 
 
23fi 
 
 NEW YORK CUSTOM-HOUSE. 
 
 of any fair man that be did so not for the purpose of getting the truth for the 
 United States, but in order to make trouble in this branch of the boflineM. 
 Q. What do you mean by making trouble ? 
 
 A. I mean, that if he went there really to get information that would be of 
 use to the government, he would aet in another manner than as Ik; did ; that is, he 
 would endeavor to get at the real market value. Be Bet man to work 
 
 writing letters to these houses. Now, if they are written to by outside men, 
 who are not known to them, and who ask them for their selling prices, they 
 will give them merely nominal juices. This man was also sent r amd to all 
 kinds of small places, such as grocers, small liquor dealers, restaurants, and such 
 places, where there is very little business of that kind done. 
 
 Q Is Paris a large market for these kinds of wines? 
 
 A. No ; in the strut EH use of the word it is not a market at all. Paris is a 
 retail place. The weight of the business done there is simply this : Most of 
 the bouses have an agent there who will take small orders for fifty, or even ■ 
 twenty baskets, and supply the restaurants. What we understand by the term 
 market is where there are wholesale dealers who deal with the agent of the 
 house in large quantities. Now the crude material of champagne wines is sold 
 in Paris. Before champagne is put up for the market it is called brute wine or 
 crude wine, and is sold by the manufacturer to the wholesale dealer; audit 
 can be proved that where a house fails in Franc, and for some reason is com- 
 pelled to sell its stock of prepared wine, it actually sells for less than the unpre- 
 pared wine out of their cellars. The reason of this is that each manufacturer 
 has a particular way of preparing his own wine. 
 
 Q. What is the amount involved in your seizure? 
 
 A. The claim is about $10,000 in one case, and in another $350,000. 
 
 Q. Has it been figured up and a claim made on you for that amount 1 
 
 A. No, sir ; but I have received a summons from the United States district 
 court that Mr. Draper was suing us for 8350,000. 
 
 Q. How have you entered these goods since ? 
 
 A. The invoices have been made out just as they were before, but we have 
 raised the prices to a higher figure without coming under a higher duty than 
 $6 ; but of course accompanying every shipment we send in a protest against 
 it to the collector. I do not believe the appraisers themselves had any idea of 
 doing so ; but they wore ordered to make up the invoices then under examina- 
 tion, and they put up the wines to forty-five francs. The first appraisement 
 was put to forty-five francs, but the reappraisement was put down to about 
 thirty- nine francs. We consider ourselves very much aggrieved, as we consider 
 this a most unwarrantable attack on us, and we think these seizures were under- 
 taken, not to benefit the treasury, but for the benefit of these people. 
 
 Q. Have you desired, at any time, that this matter should have been brought 
 to a speedy trial 1 
 
 A. Yes, lately, since we have had our testimony ready. 
 
 Q. How long have you been ready ? 
 
 A. Since the end of September or the middle of October. 
 
 Astor House, New York, February 1, 1867. 
 RICHARD H. TELLER, being duly sworn, testifies as follows : 
 
 By the Chairman : 
 Q. Have you been connected with the custom-house ? 
 
 A. Yes, sir, for about twenty years ; I was in the capacity of examiner for a 
 few years, and then afterwards as assistant appraiser in the liquor department, 
 fancy goods, &c. 
 
NEW YORK CUSTOM-HOUSE. 
 
 237 
 
 Q. Are you connected with it now ? 
 
 A. No, sir; I was removed November 11, 1863, I believe. 
 Q. What for? 
 
 A. Political reasons ; I was a democrat. 
 
 Q. State generally what you know of the working of the appraisers' depart- 
 ment ? 
 
 A. In 1846 the new tariff went into operation, that was Walker's tariff, and 
 Mr. George W. Pomeroy appointed me as examining clerk for all the wines and 
 liquors. Mr. Walker was then Secretary of the Treasury. Mr. Pomeroy and 
 Mr. Willis were appointed appraisers. This article of champagne, the first that 
 came in, Mr. Thomas W. Bayaud called on me and wanted me to give him prices. 
 Champagne, under the old tariff, before that paid a specific duty, so much 
 a gallon, under the tariff of 1842. Under the tariff of 1846 the valuation on the 
 wines was ad valorem. Mr. Bayaud received under this new tariff a quantity 
 of wine for the house of Renauld and Francois; he was a clerk there, and he said 
 that he wanted to enter these wines at the market value, and that he did not 
 know how to get at it. I told him that I could not give him any information, 
 as I was liable to be removed for it. He then went up to Mi'. Pomeroy, who 
 took the matter in hand, and tried to find out what would be the fair market 
 value of this wine at Havre. Pomeroy told him then what the prices were, and 
 then those wines were entered at those prices from that lime, and from that we 
 based our valuation on all these wines. The fact of it is, the wines sell more by 
 the label than by the contents of the bottle. I have sworn to an affidavit for 
 Thomas W. Bayaud of which that is a copy, I believe. (Affidavit referred to 
 by witness is already in evidence, marked B, accompanying the testimony of 
 Thomas W. Bayaud.) There is another case, that of Mr. Frederick De Barry, 
 who wanted me to pass his wines at the commencement of the war. 1 told him, 
 " I can do but one thing. If your wines come at lower prices I must ad- 
 vance on them." I did so, and he called a reappraisement. That reappraise- 
 ment took place before Mr. McElrath and Mr. Dorrance, of Boston, and they put 
 my appraisement down, and allowed Mr. De Barry to enter the wines with a 
 slight advance of about six or seven per cent, on his valuation. That reap- 
 praisement is on file in the appraisers' department. They could not sell the 
 wine and they desired it to be entered here at lower rates, at what they would 
 be willing to sell at in Reims. 
 
 Q. Do you know whether he was entering his wines at those prices when they 
 were seizet'., and his books, papers and everything appertaining thereto ? 
 
 A. Yes, sir ; that is, up to the time I left he was entering them at the rates the 
 reappraisers made. He came with the documents to me, and I told him I 
 did not want to see them ; my duty was plain and that his was plain also. If 
 you are not satisfied with my appraisement call a reappraisement, and bring 
 it before Mr. McElrath, and he will take the evidence in the case. Mr. De 
 Barry says, I will enter my wines at those prices. 
 
 Perhaps I had better put in as part of my evidence the following connected 
 statement as summary. 
 
 About beginning of year 1847, as nearly as I can now remember, Messrs. Renauld and 
 Francois called upon the appraisers in the New York custom-house to fix a price at which 
 they might enter their champagne, the Piper Heidsieck, under the then new tariff of 1846. 
 Under the former tariff the duty was specific, and little attention had been paid to the valu- 
 ation of champagne wine. Mr. George W. Pomeroy, who was then head appraiser, at once 
 entered into an investigation of the matter. It was at the time well known to the appraisers 
 that the various brands of champagne shipped to the United States had no actual market 
 prices in Rheims, because they were manufactured entirely for shipment to the United States, 
 and were not regular articles of sale in Rheims; and it was lor this reason that Messrs. 
 Renauld and Francois were obliged to consult the custom-house appraisers. Mr. Pomeroy 
 obtained the best information available, and also examined the amounts and account sales of 
 Renauld and Francois, and he consulted with the other appraisers. A price was finally fixed 
 
238 
 
 NEW YORK CUSTOM-HOUSE. 
 
 by Iheoi, mainly by taking the not proceeds of the wine as .sold in New York, from which they 
 allowed what was considered ■ moderate shipper's profit — .$ 1 or $1 05 a basket, as nearly as 
 I recollect. I was then appraiser's clerk, and knew of all the proceedings in the matter, I 
 assisted Mr. Pomeroy in going over the calculations by which the price was linally deter- 
 mined, and subsequently was ordered to pass all invoices of that wine at the price fixed. The 
 price then fixed has, I believe, been continued in all the invoices of the Piper Heidsieck wine 
 down to the present time. After that price was fixed, the Piper Heidsieck champagne be- 
 came, to a great degree, the standard by which we determined the value of other kinds of 
 champagne. 
 
 A few years after the above appraisement was made, I was appointed assistant United 
 States appraiser, and had given me the whole charge of passing the various champagne in- 
 voices. 1 was assisted in this duty by Henry Twer and A. P. Janin, who wen; what we 
 termed tasters. I continued in charge of this duty till I left the custom-house, on November 
 II, 1H>:!. I think it was about mx years alter the above appraisement that the importation 
 of the Charles Heidsieck wine commenced at New York. It was a new brand of wine, and 
 we carefully examined it in order to correctly appraise its value. In so doing we compared 
 it with the Piper Heidsieck. At first we allowed the wine to be entered at 2rt and *2'J francs — 
 bottles and packages additional : but a year or so later we again took up the consideration of 
 its value, and satisfied ourselves that the quality of the wine was a little better, and we 
 therefore determined to advance its price. We settled on 2.60 francs per bottle, at which 
 price it has ever since been regularly entered — the charges for bottles, &.c, (which are sub- 
 ject to occasional changes,) being added to the price named, which is for the wine alone. I 
 remember that Mr. T. W. Payaud, whose firm were agents /or the Charles Heidsieck w ine, 
 complained that the price of ^.;~»U francs per bottle was really above what the wine was worth 
 in Kheims. 
 
 The appraisers in both the foregoing cases fixed the price entirely upon their own informa 
 tion and judgment, independently of the importers, who were compelled to accept the ap- 
 praisers' decision. 
 
 Jvlj 7, 1865. 
 
 New York, December 19, I860. 
 EDWARD LEUCHTENRATH sworn and examined. 
 
 By Mr. Rollins: 
 Q. Where do you reside? 
 
 A. I reside now in the cifcy of New York. I am on my way home if I do 
 not find occupation. I was formerly in San Francisco. 
 
 Q. Where and when did you first see Montgomery Gibbs? 
 
 A. I saw him first in 1862, when he was first presented to me. But 1 had 
 nothing to do with him then. But I saw him in the month of August, 1863, in 
 relation to custom-house matters. 
 
 Q. Who introduced him to you then? 
 
 A. Mr. Wickham. 
 
 Q. Did Mr. Gibbs give you employment? 
 A. Yes, sir. 
 
 Q. What was that employment ? 
 
 A. He told me the reason he was in Europe, and told me that if I would 
 enter into an association with him to find out people who were defrauding the 
 Treasury Department of the United States I should have one-quarter of 
 the amount recovered, according to the law, which he showed me. 1 told him 
 I was wiiling to enter such a business with him. 
 
 Q. What compensation were you to receive — the share of an informer? 
 
 A. I was to receive one-quarter of the seizures, and to divide it with Mr. 
 Gibbs. 
 
 Q. What duties did you perform ? 
 
 A. I wrote letters to several people asking the prices of their goods. 
 Q. Had you written to Reims, and where were you at this time? 
 A. I was at Paris. I wrote to Reims about twenty-four letters. 
 Q. What instructions did ynu receive from Mr. Gibbs in reference to this 
 matter? Did you wish to get the highest or the lowest prices? 
 
NEW YORK CUSTOM-HOUSE. 
 
 239 
 
 A. My instructions were to get their prices. I wrote them for their lowest 
 prices. But neither of us at that time had money enough to pay for more than 
 one bottle if we had ordered more. 
 
 Q. How did Gibbs propose you would get your pay by being an informer? 
 Was anything said about compelling the importers to pay you "hush money" 
 or anything of that sort? 
 
 A. Yes, sir. Once he said confidentially that when I found the people doing 
 anything wrong to make them pay direct to us, and let the business go on to 
 America, and that we need not make any report to the government at home. 
 He was very miserable to me, and I informed Mr. Blake, who forced him to 
 pay me. 
 
 Q. When did this interview with Mr. Gibbs take place? 
 A. About March or April, 1S64. 
 
 Q. Have you had any correspondence with him in reference to that inter- 
 view ? 
 
 A. Ye^, sir. On the 15th of September, in 1864, I wrote him a letter, of 
 which the following is an extract: "I shall at once place the matter before the 
 government of the United States, sending copies of this letter, and also docu- 
 ments and vouchers in my possession; nor shall I omit, in that case, to inform 
 Mr. Fessenden and the Secretary of State of the honorable suggestion made by 
 you to me, confidentially, to betray and sell the interest of the United States 
 government, and to levy black-mail upon friends and other merchants in return 
 for our shutting our eyes in the future to their nefarious and fraudulent practices; 
 or, to use your own words, ' to make people pay here for impunity over there ' — 
 a suggestion which, as you know, I treated with the contempt it deserved." 
 This letter was written from Paris to Frankfort. 
 
 Q. What did you understand to be Mr. Gibbs's desire ? Did he want the high- 
 est or lowest prices of wine ? 
 
 A. He never told me to write otherwise than for the lowest prices. 
 
 Q. Did the merchants know you as a business man? 
 
 A. No, sir. My impression is they cared not to answer me their lowest prices 
 on such a letter. I am sure that with money in my hands I could have got 
 cheaper than what they wrote me. 
 
 Q. Did they know you as a merchant ? 
 
 A. No, sir. 
 
 Q. What did you represent yourself to be to them ? 
 
 A. I d ; d not say. I ordered like a merchant. I made no explanation. 
 Q. Do you know William B. Farwell ? 
 
 A. Yes, sir. I was first introduced tohim in Paris in December, 1864, by 
 Mr. Gibbs. 
 
 Q. Did you make any contract with Mr. Farwell ? 
 
 A. Yes, sir ; I made an agreement with him. He made it for and on behalf 
 of the Treasury Department. 
 
 Q. State what you did by Mr. Farwell's direction and where you went. 
 
 A. He sent me all over Paris where a bottle was on exhibition in a window 
 to get the wholesale prices. But I got no impressions that could give any evi- 
 dence to the custom-house, because I operated in such a small way. Near my 
 office were all the larger houses, but Gibbs never sent me there. 
 
 Q. What was the character of the houses you did visit I 
 
 A. Only the small houses where they could sell only one or two bottles, per- 
 haps a basket. 
 
 Q. Did you visit any of the larger houses at all ? 
 
 A. There are no large houses in Paris. 
 
 Q. How much money did you receive from Mr, Farwell ? 
 
 A. He paid me until the next first of August, but since I have not hai a .single 
 cent except 8100. 
 
240 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Dock Gibbs live in Paris \ 
 
 A. I do not know where, lie lives now. He did at that time. 
 
 Q. Do you know any propositions to have been made to the merchants by 
 Mr. Gibbs in reference to an adjustment of the seizures that have been made? 
 
 A. I know of but one proposition made to Mr. EtotWIOt, of San Francisco. 
 He told him that law was a very dear business, and that he was at tin* Occiden- 
 tal Hotel and hoped to see him. Mr. Ilousset told me he made him these propo- 
 sitions, and that out of that speaking he thought he could settle the matter 
 with him better than to contest it. That is all 1 know about it. 
 
 Q. What had been your business prior to your negotiation frith the agent of 
 the Treasury Department? 
 
 A. I was in the (lour or meal business with my brother in Paris. I also had 
 the agency of Mr. Piper in champagne wine. 
 
 Q. How long were you in business there prior to this \ 
 
 A. Three years. 
 
 Q. Were you successful in business ? 
 
 A. No ; 1 was not. People would buy of me and would not pay. I lost all 
 my money and then made the acquaintance of .Mr. Gibbs. 
 
 Q. Had you ever done any business with the parties to whom you wrote letters? 
 
 A. Only one house for whom I had sold champagne as agent. 
 
 Q. In addressing these houses did you give them any references as to your 
 pecuniary responsibility 1 
 
 A. No, sir. I wrote a few lines only. 
 
 Q. Did you make any proposition as to the mode of payment ? 
 A. I was to pay cash. 
 
 The following affidavit and copies of correspondence of the above witness were 
 inserted by order of the committee : 
 
 United States District Court, Southern District of New York. 
 The United States vs. 3,109 eases of champagne wine marked S. M. & Co., and other .suits. 
 
 Southern District of Ntw York, ss : 
 
 Edward Leuchtenrath, being duly sworn, deposes and says : That he is a citizen of Prussia, 
 residing in Aix-la-Chapelle ; that he arrived in the city of New York on the eighteenth day 
 of November, 1366 ; that in the year 1863 he was requested in Paris, by Montgomery Gibbs, 
 who represented himself to be a revenue agent of the United States, to assist him in obtain- 
 ing evidence that certain merchandise, including champagne wine, was shipped to the United 
 States upon invoices representing a less sum than the true market value ; that he visited 
 Rheims, in the champagne country, in company with said Gibbs and Mr. Bigelow, then consul 
 of the United States at Paris ; that Gibbs requested this deponent to write letters to certain 
 manufacturers of champagne in Rheims and Epernay, asking prices for which they would sell 
 their wines for exportation ; that this deponent wrote letters and received replies ; and that 
 such replies so addressed to him have been, by the custom authorities of New York, appended 
 to cross-interrogations addressed to said shippers in France, and are made part of the evi- 
 dence in behalf of the prosecution. 
 
 And this deponent further saith that subsequently, in the year 1864, this deponent had an 
 interview with Willard B. Farwell, who also represented himself to be a special agent of the 
 Treasury Department; that said Farwell devoted himself to obtaining certain information 
 in respect to importations of champagne, and communicated freely with this deponent; that 
 said Farwell requested this deponent to visit small shops and grocery dealers in Paris to ob- 
 tain the prices at which they sold champagne wine; which prices this deponeut obtained 
 and gave to said Farwell, together with such wine cards as he could obtain ; that subsequently 
 this deponent went to San Francisco, and was present there at the trial for forfeiture of cer- 
 tain champagne wines, and saw said Farwell take part in the management of said causes for 
 the prosecution and also appear as a witness against the importers. 
 
 And this deponent further saith that said Farwell is fully possessed of all matters in respect 
 to said champagne wines upon which the custom-house relies to procure a forfeiture of the 
 same ; that he saw said Farwell in the city of New York at the St. James hotel on the even- 
 ing of the twenty-seventh day of November last, and, as he is informed and believes, the said 
 Farwell on the next day sailed for Europe in the steamer Persia. 
 
 And this deponent fuither saith that he is detained here as a witness on the part of the 
 claimants, and desires to proceed to Europe forthwith. 
 
NEW YORK CUSTOM-HOUSE. 
 
 241 
 
 And this deponent further saith that when he received the replies to the letter addressed by 
 him to shippers of champagne wines as aforesaid, and read the prices given therein, he did 
 not believe and does not now believe that said prices represented the lowest price for which 
 said wines could be bought at wholesale, but, on the contrary, the maximum prices of the 
 shippers, and that for cash the wines could have been bought at that time much cheaper. 
 
 And this deponent further saith that the wine cards or price lists which he obtained for the 
 said Farwell in Paris and elsewhere do not represent the wholesale selling prices of said 
 wines, but all the prices for the wines by the single bottle, or by lots of not more than 
 twenty-five bottles. 
 
 And this deponent further saith that, to his knowledge, there are no wholesale selling 
 places of champagne wine in Paris but one, and to that he was not directed to go, but to small 
 retailers. 
 
 And this deponent further saith that the said Gibbs did inform him that, as United States 
 revenue agent, it was not permitted to him to be an informer in seizure suits, but that, if this 
 deponent would be the informer, and give the said Gibbs one-half of what this deponent re- 
 ceived, lie would carry out such an arrangement. 
 
 And this deponent further saith that the said Gibbs confidentially gave this deponent to 
 understand that when this deponent received information which seemed to inculpate shippers 
 of merchandise to the United States, that this deponent was authorized to threaten the said 
 shippers with such information, and say to them that if they would pay this deponent liber- 
 ally therefor, their merchandise would be permitted to pass the custom-house, or, to use the 
 words of the said Gibbs to this deponent, "Make them pay here for impunity there," with 
 the understanding that whatever sums this deponent obtained from said shippers should be 
 divided with said Gibbs. 
 
 And this deponent further saith that said Gibbs did make advances to this deponent, with 
 the understanding that if any money accrued as informer, the sum so advanced should be 
 returned to the said Gibbs in the divisions of informer's share. 
 
 E. LE UCHTENR ATH. 
 
 Sworn to before me this 4th December, 1866. 
 
 rsE \l 1 • JOSEPH GUTMAN, Jr., 
 
 * United States Commissioner, Southern District of New York. 
 
 New York, January 15, 1867. 
 EDWARD LEUCHTENRATH sworn and examined. 
 
 By the Chairman : 
 Q. Where do you reside % 
 A. At Aix-la Chapelle. 
 
 Q. Do yon know a gentleman named Montgomery Gibbs 1 or a gentleman 
 named Farwell ? 
 A. Yes. 
 
 Q. They are assuming to be, or are, government agents in Europe % 
 A. Yes. 
 
 Q. Have you been employed by either of them in Europe to obtain the prices 
 of champagne and other merchandise ? 
 A. 1 was employed by both of them. 
 Q. About what time were you so employed ? 
 
 A. About the 1st of August, 1863, by Mr. Gibbs, and I remained with him 
 until the middle of 1864. He then left, and after some time I was engaged by 
 Mr. Farwell, and made a contract with him on the 1st of January, I860. 
 
 Q. Where did you go, while in the employ of Mr. Farwell, to obtain the 
 prices of these goods ? 
 
 A. Mr. Farwell directed me where I had to go. He directed me to go to all 
 the small places in Paris where there was a bottle of wine exposed for sale — 
 even into the groceries ; and in the Rue Lafayette he sent me to a house where 
 he had seen some wine to get the prices there. I was laughing at the idea of, 
 going to these places to get the wholesale prices of wines. 
 
 Q. Is Paris a fair place to obtain the wholesale prices of wines % 
 
 A. In my opinion, it is not. 
 H. Rep. Com. 30 16 
 
242 
 
 NEW YORK CUSTOM-HOUSE 
 
 Q. Were you instructed by cither Mr. Farwell or Mr. CJibbs, while in their 
 employ, to obtain the highest or the lowest prices, or the wholesale prices ? or 
 whai prices were yon directed to get? 
 
 A. They told me to ask for the wholesale prices ; but I knew they could not 
 give any wholesale prices in these little houses. 
 
 (,). You went around in Paris to carry out their instructions ? 
 A. Yes. 
 
 Q. Did you go anywhere else ? 
 
 A. I went to the champagne district 
 
 (.). What was your compensation 1 What were you paid for these services ? 
 
 A. I wafl promised by -Mr. (iibbs that he would divide his share of the seiz- 
 ures with me. He said, in the beginning, that if J wajB the informer he would 
 divide with me ; but when In; got hold of all I knew he would not. 
 
 (J. Did he nol pay you \ 
 
 A. At that lime I had lost all my money, and I made an arrangement with 
 him that he would nay me live hundred francs a month in advance, and that 
 when we found out some frauds he would deduct it out of my share And then 
 he left me without paying me the last month, and 1 had to settle a great many 
 other things for him. 
 
 Q. Were you employed in the San Francisco custom house ? 
 
 A. I was. 1 came to the San Francisco custom-house, hut had nothing to 
 do there hut to wait for these trials. I had a desk there, hut when Mr. Far- 
 well was removed it was taken from me, and I lost my letters and books and 
 several things. 
 
 Were you paid for your services at the desk there ] • 
 A. I was paid up to the 1st of August by .Mr. Farwell, but the government 
 did not pay me. He gave me a check on Ids private banker, and 1 had to give 
 him a receipt for it on a form of which the following is a copy, and the writing 
 is Mr. Farwell's handwriting: 
 
 The Unitfd States to Edicurd Lfttchtenrath, Dr. 
 
 For my services as special clerk in the. customs, from the 1st of April to the 31st of July. 
 1865, inclusive, at|2,w0 per annum, $666 66. 
 
 Received" of Willard 1>. Farwell, naval officer for the port and district of San Francisco, 
 the sum of six hundred ami sixty-six dollars and sixty-six cents, in United States gold coin, 
 being in full of my compensation for the period above stated, this first day of August, 1665. 
 
 Approved : 
 
 Naval Officer. 
 
 I, Edward Leuchtenrath, special clerk in the customs, for the port and distnet of San 
 Francisco, do certify on oath that I have performed the services stated in the above account ; 
 that I have received the full sum therein charged to my own use and benefit, and that I have 
 not paid, deposited or assigned, nor contracted to pay, deposit or assign, any part of such 
 compensation to the use ot any other person, nor in any way, directly or indirectly, paid or 
 given, nor contracted to pay or give, any reward or compensation for my office or employ- 
 ment, or the emoluments thereof. 
 
 Sworn to and subscribed before me, this 1st day of August, 1865, 
 
 Deputy Collector, 
 
 Q. You supposed you were in the employment of the United States? 
 
 A. Of course I did, or I never would have left my place in Paris. I was so 
 much cheated by Mr. Gibbs, I would never again have gone with an individual 
 if I did not think I was employed by the government. 
 
 Q. Flow long did you retain your desk in the San Francisco custom-house ? 
 
 A. From the first of April until the begiuning of August, I860. 
 
 Q. How much were you paid ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 243 
 
 A. I was paid at the rate of $2,000 a year. 
 
 Q. Have you made any claim on the custom-house authorities at San Fran- 
 cisco ? 
 
 A. I went there, and they promised to send my agreement to Washington. 
 I was endeavoring to get my payment for the whole year, and my expenses 
 back to France. 
 
 Q. You made a representation to the custom-house authorities there, asking to 
 have pay and transportation ? 
 
 A. I did, and I received the following reply: 
 
 Port of San Francisco, 
 
 Naval Office, June 15, 1866. 
 I have this day received from Ed. Leuchtenrath a notice that he claims salary due on a 
 certain contract executed at Paris, June 2, 1865, between himself and W. B. Farwell, late 
 naval officer, then claiming to be special agent of the United States; also that he claims 
 passage from San Francisco, California, to Southampton or Liverpool, England. 
 
 I decline to make any payment on the above claim, for the reason that there is no warrant 
 or authority existing by which said Ed. Leuchtenrath can be recognized as being an employe 
 of this office. 
 
 NOAH BROOKES, Naval Officer. 
 
 I wish herewith to submit, as part of my evidence, copies of a correspondence 
 had by and with me on this whole subject : 
 
 American Consulate General, 
 Frankfort-on-the- Main November 27, 1864. 
 
 Sir: I have now for the first time heard from America in relation to the champagne cases 
 in which yo'u assisted me. A government officer is expected here on the 29th to confer with 
 me in relation to them. I have no information as to the steps taken, or of those the officer 
 proposes, but I feel confident that you can be of service, and I desire that you shall, if you 
 so wish, have an- opportunity to assist. I shall recommend your employment, and hope you 
 may secure it, If you are employed I suppose you would go to California, but as to this I 
 cannot state before seeing the person named. I have little doubt but that an arrangement 
 can be made which will be very profitable and agreeable to you. 
 
 Write to me here at once, if you are inclined to engage. If necessary for you to come 
 here your expenses will be sent ; if you should conclude to come send your address, so that 
 letters will reach you. 
 
 If you do not come here I shall see you at Paris soon, and shall wish to arrange the matter 
 of the office furniture, &c 
 
 In looking over my papers I can find no receipt for the first 1,000 francs which I paid 
 you for salary; I mean the 1,000 paid before November 18 ; I have receipts for the subse- 
 quent payments. 
 
 Please Sign the enclosed duplicate receipt and send me with your reply. 
 I have no doubt but that all your reasonable expectations may be realized in the wine 
 cases, if you are inclhi. d to make an arrangement, 
 Yours, &c, 
 
 MONTGOMERY GIBBS. 
 
 E. Leuchtenrath, Esq, 
 
 I received from Montgomery Gibbs, revenue agent, prior to November 18, 1864, my salary 
 as his assistant from September 15, 1863, to November 15, 1863, two hundred dollars, for 
 which sums and subsequent payments I gave receipts at the times of payment. 
 
 Paris, November, 1864. 
 
 Paris, December 15, 1864. 
 
 Sir : I should have replied ere this to your letter of the 27th ultimo, but that I expected to 
 hear again from you previously, as I thought of course you would be eager to let me know 
 the result of your interview with the officer sent over from the States by the government to 
 regulate the champagne affair. As that interview was fixed, according to your statement, 
 for the 29th ultimo, and as I still remain without further news from you, I think I ought to 
 delay no longer my answer to your letter. 
 
 I am greatly obliged to you for your kind intention to procure me some profitable employ- 
 ment in California, or elsewhere, which I shall be happy to accept, if it is made worth my while ; 
 this you know, however, is simply a secondary matter between us, the primary and princi- 
 pal question being, my share in the proceeds of the sale of the champagne confiscated in con- 
 
244 
 
 NEW YORK CUSTOM-HOUSE. 
 
 nequence of information supplied to the government of the United States by me, and me 
 alone. 
 
 As I sec more and more clearly that you an persistently hent upon misrepresenting the 
 true nature of our relations, and substituting u fiction of your own coinage for the real facts 
 of the casi?, I think it is high time to recall to \ our mind the history of our connection, firon 
 the beginning. 
 
 About the hitter half of last year yon called 11)11111 me with my friend Wickham's introduc- 
 tion and recommendation, and showed me your authorization, signed hy Mr. Seward, to aet 
 as revenue agent of the United States, and to watch in Kurope over the due exec ution of the 
 
 law of March :5, \*iY.\. 
 
 You told me that the principal part of your mission Vraf to detect the frauds perpetrated to 
 an enormous extent by the mercantile community of Kurope upon the United States revenue 
 by the very simple expedient <»f fictitious invoices, misstating the quantity or quality of the 
 goods, and made out at much lower figures than the current market price of the day ; and \ Ml 
 consulted me as to the best mode of proceeding in the matter. I pointed out to you at once 
 the immense difficulties in your way, and soon succeeded in convincing you that without 
 
 the aid of a coi icial man of some standing, and well known in business circles, all your 
 
 efforts to detect and prevent such frauds must prove unavailing. You speedily found that I 
 was the indispensable man whom you wanted to successfully fulfil your mission. You in- 
 formed me that the law of March I or another law, decreed the confiscation of all poods 
 imported into the United States with false declaration of value, one-half of t he proceeds of the 
 sale of the poods so confiscated to go to the treasury, the other half to be equally divided be- 
 tween the custom-house officers making the seizure and the party giving kite requisite infor- 
 mations for the officers to proceed upon. 
 
 You told me that in your capacity as revenue apent you were precluded from claiming per- 
 sonally any share in the proceeds of such sales of poods, confiscated in consequence of infor- 
 mation supplied throuph your means, but that if I was williiiL r to enter into an arrangement 
 with you tO gO share and shaie alike, the information might be supplied by me. which would 
 of course entitle me to one-fourth of the. proceeds. I told you in reply that I was quite 
 willing to enter into an arrangement of the kind, but that, having unfortunately Buffered lately 
 some grievous losses in business, I was not in a position then to make any co-operation with 
 you a matter only of speculation on my part, and that, though I should of course look to 
 the contingent bene tit promised for the real reward of my labors, I yet must stipulate for the 
 receipt meanwhile of a certain fixed sum per month to enable me to live; such sum to be 
 paid me by you by way of advance, and to be repaid subsequently out of such share on the 
 proceeds of the sale of goods that should be confiscated upon information supplied by me. 
 You, consented to these terms. I suggested as the only possible way of operating with a 
 chance of success that I should establish a commission business in Paris, and take an office 
 for that purpose. You were altogether ignorant of commercial business in Europe, and were, 
 moreover, precluded by the very nature of your position from assisting in any way effectively 
 in the pursuit of the object in view. I, well known in business circles, not in France and Paris 
 alone, but also in Italy. Spain, England, Holland, Belgium, and Germany, speaking and 
 writing five languages, and with a proper amount of commercial experience to guide me iu 
 my operations, was, as you yourself readily admitted at the time, the man to conduct our 
 joint venture to a profitable and successful issue. 
 
 I accordingly established my commission business, and took the office in the CiteTrevise, 
 No. 10. I set at once to work sending out letters in every direction, and to men in every 
 branch of business, desirinp price-lists, samples, &c, to be forwarded to me. You will 
 please to remember that the entire business was conducted by me alone, every letter being 
 written and signed by me, and every reply being addressed to me personally. You had 
 nothing to do with the business, and were altogether about ten hours at the office during the 
 four months the affair lasted. You know I would not have permitted you to open a single 
 letter had you felt inclined to commit an act of the kind, which I admit, however, you never 
 attempted. You asked me occasionally to let you show some of my letters to the United 
 States consul here, which I always readily consented to do, and you duly returned such letters 
 afterwards to me. 
 
 From the delicate nature of the transaction I had abstained from entering into a written 
 agreement and contract with you, which I moreover deemed superfluous, seeing that all the 
 letters, that is, the means which alone could enable us to detect attempted frauds upon the 
 United States revenue, were my sole and exclusive property. 
 
 In the course of our connection you asked me, among other things, to examine and classify 
 some fifty thousand invoices sent to my office from the United States consulate. You wrote 
 me that you wanted me to help Mr. Bigelow, which would do you a great deal of good. The 
 immense labor thus thrust upon me would brook no delay. As my time then was more than 
 fully occupied you proffered me your aid in inspecting my correspondence, and under this 
 pretext you asked me to let you take home with you a certain set of letters. Looking upon 
 you as a gentleman and a man of honor, and fully determined on my own part to keep faith 
 with you, and let you have your fair share in the proceeds of my operation, I, alas ! unsuspi- 
 ciously consented to your request, and handed you those important letters, which subse- 
 quently enabled the United States revenue department to effecUhe seizure of champagne cases 
 
NEW YORK CUSTOM-HOUSE. 
 
 245 
 
 to a very, very large amount. But when I asked you afterwards to give them back to me 
 you suddenly turned round upon me and told me with the most unblushing effrontery that you 
 looked upon these letters as your property, and that I should never see them again. I have 
 some reason to believe that you informed your government that you could purchase these 
 letters, thus most dishonestly purloined from me, for a considerable sum of money, and you 
 have since persistently attempted to swindle (I am sorry I can find no more polite term con- 
 sistent with the facts of the case) me out of my fair share, payable to the informing party. 
 You would wish to degrade me to the position of a mere salaried clerk. You will not suc- 
 ceed in this, let me tell you, however so great an adept you have shown yourself to be in the 
 noble act of stating the things which are not. 
 
 On the occasion of your first visit to me you gave me to understand, among other matters, 
 that you were authorized and supplied with the mesns to purchase the Grand hotel, if you 
 should deem it advisable or expedient to do so. I but too speedily had occasion to discover 
 the lamentable deficiency of your pecuniary resources. The paltry sum of five hundred francs 
 per month, stipulated by me, was, as you are aware, and as my cash book, cheeked by you 
 throughout in every item, shows, doled out, occasionally in trifles so small as five or twenty 
 francs at a time. You could not even pay for the samples of goods ordered by me, and I had 
 repeatedly to cancel my orders, which of course greatly interfered with the success of my 
 operations. When I had occasion to ask you for some money you were not ashamed to tell 
 me that you were run so completely dry as to be unable to pay the patissier who supplied 
 you with your dinners, and I was actually called upon to advance often money for the dis- 
 charge of liabilities incurred by you; nay, you even neglected to pay in proper time the 
 bills which you had incurred with the tradesman here, to whom I had introduced and recom- 
 mended you, to the grievous injury of my own credit and fair fame. When I found how ex- 
 tremely difficult it was to get money from you, even for the most pressing and legitimate 
 demands, I made up my mind to sever the connection between us. When I informed you 
 of this resolution of mine, however, you entreated me so warmly to continue, and plied me 
 with such brilliant offers, that I consented to your request. Do you remember how you told 
 me that I was to accompany you to New York, thence to travel with you to San Francisco 
 in a government steamer, at the expense of the treasury ; how I was to be supplied with a 
 splendid team of horses, &c, &c. ? I was repeatedly advised at the time to make a bundle 
 of my champagne letters, which were lying for Aveeks at my office before you diddled me out 
 of them, and to return them to the writers, who would assuredly have rewarded me most 
 liberally; but I am too houest a man to play tricks of the kind, and I value the opinion of 
 my many American friends much too highly to commit any act so prejudicial to the interests 
 of the government. And after all your brilliant promises you suddenly left me, even with- 
 out paying the stipulated advance, then due for the last month, and you left me to settle also 
 the taxes of our premises, and to have pelted at me a number of bills owing to your tailor, 
 shoemaker, photographer, &c. 
 
 You first pretended that you would refer the question of the five hundred francs due to me 
 to Mr. Wickham's arbitration, and that you would be bound by his decision. Well, that 
 upright and honorable gentleman of course pronounced against you, and where is your 
 promise now ''to be bound by his decision ?" I am sorry I should be compelled to speak to 
 you in this manner, but your conduct to me leaves me no choice. You want to pocket my 
 share in the champagne affair. You may look upon the diddling me out of my letters and 
 vouchers as an act of smartness, but I and every honorable man can only look upon it as 
 an act of downright aud most disgraceful dishonesty. You know you have repeatedly 
 warned me from mentioning to anybody the nature of our operations, and of my claims 
 against the government of the United States. I have abstained hitherto from doing so, in 
 the hope that you would in the end be wise enough to offer me some acceptable terms of 
 compromise, but I am now at last so reluctantly compelled to open my eyes to the fact that 
 all you want is to gain time to consummate your nefarious purpose of depriving me of the 
 fair reward of my labor, and to secure the whole for yourself, throwing me half contemptu- 
 ously the bone of some imaginary employment in California, with a hollow promise of ob- 
 taining for me also a pecuniary consideration from the United States government. I now 
 tell you in the plainest terms, sir, that this little speculation of yours will not succeed quite 
 to your heart's content ; at least not without a determined struggle on my part, in which I 
 have the happiness to know I shall not stand alone, but shall be aided by the disinterested 
 support of every honest American gentleman here, and of divers rather influential parties in 
 the States. In brief, then, I call upon you now in the most peremptory and categorical 
 manner to propose some equitable arrangement between us, and to give me proper and suffi- 
 cient guarantees that such arrangement, should I see fit to agree to it, shall be duly carried 
 out. Vague and idle promises will not do for me; I must have something positive and 
 tangible. If j^ou should fail to propose an acceptable arrangement within eight clays from 
 this I shall at once place the matter before the government of the United States, sendiug in 
 copy of this letter and also the documents and^vouchers in my possession, nor shall I omit 
 in that case to inform Mr. Fesseuden and the Secretary of State of the honorable suggestion 
 made by you to me confidentially to betray and sell the interests of the United States gov- 
 ernment, and to levy black-mail upon the French and other merchants, in return for our 
 shutting our eyes in future to their nefarious and fraudulent practices, or, to use your own 
 
246 
 
 NEW YORK CUSTOM-HOUSE. 
 
 words, "to make people pay here for impunity over then ■:" 1 Suggestion which, as yon 
 know, I treated with the contempt it deserved As to your cool request to sign the precious 
 receipt drawn out by you, you must really give me credit tor a larger share of childlike 
 fanocence than even the credulous heliet' hitherto shown hy me in the fancied uprightness of 
 your character and disposition could possibly warrant, that you should for a moment have 
 thought it likely I would fall into so shallow u trap. No, sir, I gave you hut U>0 nianv re- 
 ceipts for larger sums than I ever got from you. Von know well enough how you used to 
 take advantage of my straitened circunist a m i s to put the screw upon me. Fortunately 
 tor me. however, my cash-hook remains in my possession, with every item checked by voii, 
 which affords the OUI7 reliable control in the matter of your payments to DM and my dis- 
 bursements for you, and the only evidence which can propeilv he admitted in the case. 
 Awaiting your answer within eight days from this, I remain 
 Yours, &c, 
 
 EDUAKI) LEIX'HTENRATH, 
 
 lit Cite Tririse. 
 
 Moxnio.MKiiv Omits, 
 
 American Consul General, l'ranlifnrt-un-tlu -Main. 
 
 Cons (I. \ 1 1; w. OF TBI I'm 1 id 8 1 kTES, 
 
 I'nml.jnrt. Dsssatftsr 20, 1864. 
 
 Sir: I have this moment your letter. I will not attempt to ( shoiBOtBfise that remarkalde 
 performance. If there is cue spark of gentlemanly feeling left in you, you are already 
 ashamed of having M ritteii it. As the gi eate>t act ot kindness to you, J shad keep the letter 
 to he handed to you again. 
 
 You seem to think that seizures of wine have Keen made in consequence of information 
 furnished by us. Until the "J«Mh or :?<»th of November, I supposed myself the information 
 furnished in November, \*iY.\, had been used, but this is not the case. No information of any 
 kind with which you have had anything to do has been used in these or any other cases. 
 No information in relation to any matter, derived in any way from you, ha> ever been of the 
 slightest use. 
 
 I have no objection to stating how the wine cases originated, as told me by the agent of the 
 United States, now here. In the summer of IH>4, nearly a year after my reports, the partner 
 in a wine house at San Francisco betrayed his partner, and carried true and false invoices to 
 the custom-house. He implicated several other concerns, and gave positive proofs of ex- 
 tensive Grands by numerous houses. The books and papers of several houses were seized 
 under the law of March '.\, ISM, and evidence obtained sufficient to confiscate all the goods 
 seized. They would have been at once confiscated, but the w ine men obtained time to send 
 to Fiance for proof; they got it, and very soon a great number of witnesses are to be exam- 
 ined before the mayor of Reims. A government officer has come to overlook the matter 
 with me, not to take or procure evidence, but to watch them. The government wishes no 
 evidence, except such as it seized. 
 
 After the disclosures at San Francisco, an agent went to New York and induced the customs 
 officers there to seize ou the information obtained at San Francisco. They very reluctantly 
 did so. but found in the books and papers seized ample testimony to confiscate the wine. 
 Only a little w as seized, about 6,000 baskets, I am told. These seizures were made nearly 
 a year after my report, and were made before the officer I allude to ever knew of any such 
 report, and he onlj saw it by accident. It was sent to Congress, and on it the duty was 
 changed to specific, but no case was ever commenced upon it or upon any information I have 
 furnished. So far as the money I have expended in our arrangements is concerned, it might 
 as well have been thrown into the Seine. In April and May last. I procured more valuable 
 correspondence with wine men, and more information from a party in England, than all you 
 ever obtained, and it cost me nothing. The chief case is the Charles Heidsick case. In 
 that, though I often asked it, you never got any information. I have perfect letters in that 
 and several others, from parties you never heard of. I never reported to the government that I 
 had the letters procured by 3-ou ; never told them what proofs I had. The letters are still 
 lying idle, and are worthless. I have no earthly objection to giving them to anybody, w ere 
 it not for the principle involved ; they are the property of the government, and it may, and 
 probably will, either make you a present of them or burn them in your presence. I leave 
 that question to Mr. Bigelowaud the charge, for it relates solely to the government ; no one 
 but Mr. Bigelow knows of their existence, and I don't esteem them worth a penny to the 
 government or anybody else. We have infinitely better letters of our more recent procuring, 
 if we needed to use any. 
 
 I regret that no action was ever taken on any reports of ours. I hoped to make some con- 
 tingent fees to help out my small pay, as I was promised by the government I might do. 
 They have got along without me or you, and my hopes in that respect are null. I hoped to 
 have seizures made a year ago on information supplied in my reports, but government did not 
 act, and I cannot help it. 
 
NEW YORK CUSTOM-HOUSE. 
 
 247 
 
 Now I have this to say : I have on two occasions urged the government to seize, and to allow 
 me to arrange with you. I will show you these letters if you like. No answer ever came, 
 Not one word was ever said to me in reply. In consideration of your peculiar treatment of 
 me I would have dropped the matter, but I had promised Wickham to do all I could for you, 
 and I shall. Seeing that none of our information or papers were ever used or would be, and 
 that my hopes for you and myself were groundless, I asked the officer who is here, after 
 explaining your position and my disappointment, if he could not offer you some position. I 
 asked this as a favor. He seemed to be inclined to believe that you could be of no use to 
 him; but when I explained your knowledge of languages and of business, he said he would 
 be glad to have such a person in the customs at San Francisco. 1 therefore, by his permis- 
 sion, propose, if you desire it, that you take a position, aiding him in any way you can for 
 the few months he is in France, and afterwards that you go, "at the government expense," 
 to California. He will offer you a liberal arrangement. In California, the most beautiful 
 and .prosperous country in the world, you would open up a new career, and I hope a pros- 
 perous one. 
 
 Now, if you see fit to consider such a proposition, very well ; if not, say so at once, and we 
 will drop this business. 
 
 If you do make an arrangement it will be necessary to aid him and me if we desire it, and 
 it would be necessary for you to conduct yourself as you used to do — as a gentleman should. 
 There can be no contingent arrangement ; for no one having any contingent interest in any 
 case can give or produce any testimony. I will try for a liberal arrangement — one that 
 would leave you free to go to San Francisco, and which would almost surely lead to some- 
 thing very comfortable there. 
 
 Please write me here whether you would like the arrangement, and I will at once make a 
 specific, written proposition. If you do not wish it, say so in few words, and not abusive 
 ones. You injure yourself more than me by stooping so low as you have done in your letter, 
 but I forget that. 
 
 If you do not say you will join us I shall look out for some suitable person here, and you 
 will not hear again from me. The letters will be placed in the consulate, and you and the 
 government may settle the matter. As for me, I would as soon hand them to the chiffonier 
 as to keep them. 
 
 I will show you the copies of the papers showing how these seizures were made. I have 
 them. You can easily satisfy yourself that neither you nor I have had the slightest part in 
 them. I don't think this, however, either your fault or mine. 
 
 Please reply briefly by first mail. After the holidays I shall go to Paris, and will see you 
 at once in any case. 
 Yours, &c, 
 
 M. GIBBS. 
 
 E. Leuchtenrath, Esq. 
 
 Paris, December 22, 1864. 
 Sir: I acknowledge receipt of your letter of 20th instant. If you will be kind enough 
 to send me the specific written proposition mentioned therein, I will give it due considera- 
 tion. With regard to the other matters in dispute between us, I deem it the wiser course to 
 defer entering into them till the time of your promised visit here. Of course I expect that 
 visit will not be delayed beyond the first week in January, as I am determined to bring the 
 affair to a settlement without further loss of time. 
 Yours. &c, 
 
 E. LEUCHTENRATH. 
 
 Montgomery Gibbs, Esq. 
 
 Consulate, 79 Rue Richelieu, 
 
 December 31, 1864. 
 
 Edward : I am here to confer with the government official before he leaves. He will 
 allow me to make you a proposition which will be very desirable for you. I hope you will 
 drop all side-issues and accept it at once. Before making it in writing it is necessary we 
 talk it over a few minutes, so we may fully understand it. Send me word here at once, and 
 by 12 o'clock, if you will meet us at the reading-room of the Grand Hotel at 2 this p. m 
 I hope to have your salary commence on Monday. I await your reply here. Our proposi- 
 tion will cover all matters, and will give you au honorable position in America, and I hope 
 a permanent one. 
 Yours, 
 
 M. GIBBS. 
 
248 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Pius, Drttmber 31, 1861 
 
 SIR: I am sorry: I receive your note of to-day at tins very minute, 'A o'clock, and of 
 coarse cannol come to the rendezvous at the Grand Hotel. Please let me know, iu time, 
 when- I can sec you. 
 Yours, 
 
 EDWARD LEUCHTENRATH. 
 
 M. Gmns, Esq. 
 
 MiiMiw Bfoumra 
 
 Edward: I thought that my note might fail to reach you. I did not regret it. as I was. 
 and am Btill, very unwell with my neuralgia. The gentleman who proposes to close the ar- 
 rangement has concluded not to leave for a few days, and then- is, therefore, no haste. I 
 am too unwell to do business to-day. Come up to tie- Grand Hotel Tuesday, to-morrow, at 
 precisely I o'clock, and I will meet you in the reading-room. I have a complete arrange- 
 ment to propose to you, which will give you an honorable and lucrative position in the 
 United States I am perfectly sure you will he satisfied, and will see that I have done all 
 for you that either you or your best friends could expect. 
 
 To-morrow, at I p. m., Grand Hotel. 
 Yours truly, 
 
 M. GIBBS. 
 
 This agreement, made this second day of .January. A I). l*fi."V, at Paris, in France, between 
 AY. IV Harwell, special ;i'_r«-nt of the United States Treasury Department, and Edward Eeuch- 
 tenrath witnessetn: That the said W, 1;. Farwell, acting for and in behalf of tin -aid Treas- 
 ory Department, aforesaid, agrees to hire and employ the -aid Edward Eeuchtenrath as 
 a special clerk in the United States customs, and as a clerk and assistant to him. the said \V. 
 B. Farwell, either at I'arisor elsewhere in Europe, for such time as may be required by him. 
 the said Farwell, 01 as examiner of foreign invoices anfl merchandise, or in any other clerical 
 position iu the United States Customs, at New York or San Francisco, a- the Bald Lem htenrath 
 may be directed by the said Farwell or by the Secretary of the United States Tieasury De- 
 partment, through any d Illy authorised officer of the United St ttes customs at San Francisco 
 or New York, ami to pay him. the said Edward Eeuchtenrath, the .sum of ten thousand francs 
 per annum, for such clerical or other services, in United States gold coin, payable monthly 
 or oftener if the said Farwell or other duly authorized egeut of the United States shall de- 
 sire to do so. 
 
 The term of service for which said Farwell agrees to employ said Leuchtenrath to be one 
 year from the date of this instrument and no longer. And the said Farwell further agrees, 
 on behalf of the government of the United States, to pay the passage of the said Leuchten- 
 rath from Southampton, iu England, to San Francisco, first-class fare: and if the said Leuch- 
 tenrath shall give due notice of a desire to return to Europe within fifteen days from the time 
 of the expiration of this agreement to pay also, his, the* said Edward Leuchtenrath*s fare — 
 letter A, first-class — from San Francisco or New York, at whichever point he, the said Leuch- 
 tenrath, may then be, to Liverpool or Southampton, in England. 
 
 And the said Leuchtenrath ou his part agrees to each and all of the foregoing stipulations, 
 and binds himself faithfully to perform all services that he may be directed to do of a clerical 
 nature, either in Europe or the United States, or as an expert in the matter of ascertaining 
 the market value of foreigu merchandise to the best of his ability and judgment, and to be 
 ready to leave Southampton, in England, for San Francisco, in California, in the British 
 mail steamer which leaves that port on the seventeenth day of February next, 1865, for St. 
 Thomas, connecting there with the steamer for Aspinwall, and on being furnished with 
 passage tickets by said Farwell or by his duly authorized agent — letter A, first-class fare — 
 and to depart in said steamer for San Francisco on that day. 
 
 It is understood that this written agreement embodies all agreements, understandings, and 
 arrangements of every kind expressed or implied between the parties hereto. 
 
 Witness our hands at the city of Paris the dav and vear aforesaid. 
 
 W. B. FARYYELL, 
 Special Agent of the U. S. Treasury Department. 
 
 ED. LEUCHTENRATH. 
 
 Executed in presence of— 
 
 Montgomery Gibbs. 
 
 to whom it may concern. 
 
 That there may be no misapprehension of the penalties attached to the illegal introduction 
 of dutiable merchandise into the United States, either without the payment of duties or by 
 passing or attempting to pass through the custom-house, any false, forged, or fraudulent in- 
 voice, the following section of the act of Congress, approved August 30, 1$A2, is published 
 for the information of all : 
 
NEW YORK CUSTOM-HOUSE. 
 
 249 
 
 "That if any person shall knowingly and wilfully, with intent to defraud the revenue of 
 the United States, smuggle or clandestinely introduce into the United States any goods, 
 wares, or merchandise subject to duty by law, and which shall have been invoiced, without 
 paying or accounting for the duty, or shall make out, or pass, or attempt to pass through the 
 custom-house, any false, forged, or fraudulent invoice, every such person, his, her, or their 
 aiders and abettors shall be deemed guilty of a misdemeanor, and on conviction thereof shall 
 be fined in any sum not exceeding five thousand dollars, or imprisoned for any te*m of time 
 not exceeding two years, or both, at the discretion of the court." 
 
 The foregoing penalties, in addition to the forfeiture of the merchandise so attempted to be 
 introduced without payment of legal duties, will be rigidly enforced in this district. 
 
 Domestic manufactures, upon which drawback of duties or internal revenue tax has been 
 allowed on exportation, or upon which such tax has not been paid, are liable to duty on re- 
 importation, as though of foreign growth or production ; and, like foreign merchandise, is 
 subject to seizure when attempted to be introduced without payment of duties. 
 
 Any person who shall give information of smuggling, or of the illegal introduction of for- 
 eign or domestic dutiable merchandise, that shall lead to seizure and forfeiture of the same, 
 will be entitled to one-quarter of the value of the goods seized. 
 
 CHARLES JAMES, Collector. 
 
 Synopsis of the champagne case. — It has gone to the jury. 
 
 The case of the United States vs. 400 Baskets Champagne, claimed by Heidsick & Co., 
 the trial of which terminated in the United States district court this morning, was in all 
 respects similar to the case of Eugene Clicquot, reported at length in our issue of the 3d 
 instant. Beside the formal proof of the entry at the price of 2$ francs per bottle as the 
 market value in France, on board ship, the government read three letters signed by Heid- 
 sick & Co. — one to a French wine dealer and two to a London gentleman — stating that 
 they (Heidsick & Co.) had only one kind of champagne wine for export, and that the price 
 at their cellars in France was 4 francs per bottle. 
 
 Defendants read depositions similar to those read in the Clicquot case, to show that none 
 of this wine was ever sold in France, and that hence there could be no market value for it 
 there, and that the only way of fixing a market price and value would be to invoice it at its 
 prime cost to manufacture. They proved also by Mr. Maury, the defendant's agent at San 
 Francisco, that In fourteen years he had sold here 31,005 baskets of this wine, and that the 
 net product to the owners in France had been, on the whole, at the rate of over 4 francs per 
 bottle, ail losses by breakage and other causes being first deducted. 
 
 The government introduced, in answer to the letters of Eugene Clicquot, used in the other 
 suit, to show that his house offered to sell wine in France, and several prices current of Paris 
 wine dealers offering to sell champagne wines at wholesale. They also called Edward 
 Leuchtenrath, who testified that he had been a wine merchant at Paris, and the agent of one 
 of the largest champagne manufacturing houses of France ; that for two years he had been 
 in the emplojmient of the United States especially for the purpose of prosecuting inquiries 
 as to the champagne trade, and the prices in France, and that he was now employed at a 
 salary, and had come here to testify in these cases for the government. On being handed 
 letters purporting to be signed by Mumm & Co., De St. Mareeau & Co., Chas. Farre, and 
 others, addressed to witness, and offering to sell him champagne at certain fixed prices, wit- 
 ness stated that he knew no such firms; that he only knew he had written letters to such 
 houses at the request of the agent of the treasury, and received these replies, but that he 
 did not know their haudwriting ; that he had been three times at Reims; knew the house 
 of H. Piper & Co., personally, and Widow Clicquot, Charles Heidseiek, and Moet &- Chan- 
 don by reputation only. The entire ignorance of this witness in relation to all the matters 
 which the government attempted to prove by him seemed to take the counsel for the United 
 States much by surprise, and produced much merriment in court. 
 
 After lengthy and able arguments by Judge Lake for the United States, and Hall Mc- 
 Allister for the defence, the judge charged the jury as in the former case — that if they be- 
 lieved Heidsick & Co. had knowingly invoiced this w r ine at less than its market value in 
 France, at less than his usual selling price there, then they would find for the government. 
 The jury retired at 12 o'clock m., and had not agreed up to the time of our going to press. 
 
 United States District Attorney Lake, M. Gibbs, and C. Halsey appeared for the United 
 States, and Hall McAUister and S. V. Smith for the claimants. 
 
 Nkw York, January 12, 1867. 
 ANTHONY OECHS sworn and examined. 
 
 By the Chairman : 
 Q. Are you connected with an importing house here ? 
 A. I am with the house of Moet & Chandon. 
 
250 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Do tliey do business here or abroad ? 
 
 A. Abroad — at Epernay, in France. 
 
 Q. What goods do you negotiate or Hell ? 
 
 A. Winefl and brandies. 
 
 Q. Do you make entries at the custom-house ? 
 
 A. Yom 
 
 Q. Had you any difficulties there? 
 
 A. Yes. 
 
 Q. When? 
 
 A. 'Three years ago, when they seized 2,700 cases of champagne. 
 
 Q. What were they Beized for? 
 
 A. For underyaluation. 
 
 Q. How did you enter them, as owners or consignees 1 
 
 A. As Consignees. 
 
 Q. You entered them on the invoices furnished you ? 
 A. Yes. 
 
 Q. On the same as had been always sent you f 
 A. Yes. 
 
 Q. Where did they seize them I 
 
 A. In the custom-house. We went to know the reason <>t their seizure. 
 They kept them four or live months before we could get a rcappraisement ; but 
 iinally they gave a decision. 
 
 Q. Who did you see at the custom-house ? 
 
 A. We left the matter in the hands of our lawyers. 
 
 Q. Who were your lawyers ? 
 
 A. Webster cV Craig. 
 
 Q. Who suggested to you to employ them ? 
 A. No person; 1 knew them byname myself. 
 
 Q. After the seizure of your goods you went to the custom-house to see about 
 them ; did you see Harney or Hanscom at all ? 
 
 A. I did not see either of them ; 1 only saw Mr. Dorrance ; and I went to 
 hhn at least a dozen times to request him to make a reappraisement. They 
 kept me a long time waiting; and finally they appointed Mr. Sherman, and he 
 kept the matter in hand a couple of months before he gave a decision, the wine3 
 remaining locked up the whole time. I showed him an account of the sales, 
 and that the house on the other side did not receive more than 4 per cent, over 
 the price at which they were entered on the invoice. 
 
 Q. What then followed ? 
 
 A. He said he would wait for some information from Europe before he could 
 conclude my reappraisement. I told him I did not care how high he put up 
 the wine, but that I wanted to know what he was going to do with them, as I 
 wanted to sell them, and they had been locked up then nearly four months. 
 He said, " If you want to finish this thing I am going to finish it this afternoon ;" 
 and he did so, and raised it above 10 per cent.; and he then seized it, and we 
 gave bonds. 
 
 Q. How long ago is it since the goods were seized ? 
 A. Since May, 18(54. 
 
 Q. And the case has not been tried since ? 
 
 A. No. We wanted to bring it on the other day, and they put it off. There 
 is no secret about the thing; I believe they want to make money, that is all. 
 Q. Who wants to make money ? 
 A. I don't know. 
 
 Q. Have you been offered the goods if you paid a certain amount of money ? 
 A. I believe we could get them. 
 
 Q. Was there any proposition or suggestion of that kind made to you by 
 anybody ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 251 
 
 A. The intimations thrown out to me were such that I believe it could be 
 done. 
 
 Q. Did any person ever tell you that it could be settled ? 
 
 A. Not positively. 
 
 Q. Was it intimated to you ? 
 
 A. It was. 9 
 Q. Do you remember who intimated it to you ? 
 
 A. Yes; but it was told me in a private conversation. It was told me that if 
 I did not say anything, that my informant could settle it for me. He told me 
 he thought it could be settled by paying 37,000. 
 
 Q. Who told you this? 
 
 A. I gave him my word and honor not to tell, and I cannot do so in conse- 
 quence. 
 
 Q. Did he tell you how it could be done, or what facilities he had for doing it ? 
 A. No. He said if you want to settle this thing he could do it, and to get it 
 out of the hands of the lawyers, and that he believed he could settle it for me. 
 Q. Who had this conversation with you? 
 A. I decline to answer. 
 
 Q. Had you any correspondence with Mr. Montgomery Gibbs ? 
 A. He wrote to our house in Europe. 
 Q. Do you know anything about it? 
 
 A. No." * 
 
 New York, January 14, 1S67. 
 
 JAMES MEYER, jr., sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you in business here 1 ? 
 A. I am. 
 
 Q. What kind of business are you engaged in? 
 
 A. I receive wines on consignment from Jules Mumm & Co. and from 
 Eschenauer, Benecke & Co. 
 
 Q. What kind of wines do they send you ? * 
 A. Champagnes, clarets and brandies. 
 
 Q. Hive you had difficulties in entering these in the custom-house? 
 A. Yes. 
 
 Q. When had you these difficulties, and what caused them? 
 
 A. I am in business fifteen years here, and never had any difficulties until the 
 time that the wines of all the other houses were seized. There were four or 
 five houses seized before mine was. I was receiving my wines regularly as 
 usual, and just a couple of days previous to the seizure I was warned not to 
 enter my wines, as I had a shipment just then. But I said I would enter them, 
 and I did do so ; because I had done nothing wrong I was not afraid. I entered 
 100 cases, and I was told I was putting them into the lion's mouth. I said if 
 the United States wants to take them let them take them. Well, one of my in- 
 voices was passed a few days before without any trouble at the same price 
 at which I had always received the wine, to the great disgust of Hanscom. A 
 short time after some custom-house officers came after that wine, one hundred 
 eases, which had been passed regularly and on which I had paid duty, and re- 
 ceived my liquidation from the custom-house. They had an order directing 
 them to seize these 100 cases which had been fraudulently entered by James 
 Meyer, jr , and was concealed in his store. I expressed my indignation at such 
 an order, as I had entered'nothing fraudulently, but as I had always done, and 
 I produced my receipt and liquidation from the custom house. I told them a 
 
252 
 
 NEW YORK CU8TOM-HOU.SK. 
 
 portion of the wine was in my cellar and they could follow in*- down and do 
 what they pleased with it. They then seized the wine and took it away. 
 About two months afterwards I rendered an account of my sales witji my ac- 
 count charges to Jules Milium & Co. 1 return my sales to them every month, 
 and it takes two months before I receive returns back from them. About eight 
 or ten <J^s before, as I have stated, I had received a shipment of LOO cases. 
 And when my monthly account sale was to be made out, my bead clerk, whose 
 business it is to make it out, was sick, and my younger clerk made if onl in his 
 stead. I took it for granted he made it out correct, and 1 signed it and sent it away, 
 knowing when they got it they would examine it to see if everything was correct. 
 They did examine it, and found the custo n-house had made an error in making 
 out the invoices, in charging no duty on the one hundred cases. In making out 
 the custom-house entries, the clerk there made this mistake ; and my head clerk 
 being sick at the time, my younger clerk, who had the verifying of these 
 figures, did not detect the mistake, and it was not noticed until detected abroad. 
 The house then wrote to me that I made an error in charging so much duty on 
 the shipment, and they credited me with it. They did not see that it was the 
 custom-house made the mistake. When I received that letter I went to Mr. 
 Draper and said here is a letter I have received, by which I see they have de- 
 tected an error in the custom-house, and I gave him the amount which was over- 
 looked. He thanked me very much for the manner in which 1 h id acted, and 
 directed me, in order to have the matter rectified, to pay it to tin; entry clerk. 
 I gave my broker an order to pay the amount and have the error rectified. In 
 the mean time Mr. Hanscom got wind of the matter, and when my broker went 
 to pay it, there was an order not to receive it from Mr. Hanscom. I then went 
 to the naval othc r, Mr. I )enuison, and he refused to allow it. I then went back 
 to Mr. Draper, and there was a very unpleasant time, as they opposed him. 
 Mr. Hanscom wanted to fall back and seize another one hundred cases instead 
 of those which had escaped him. I told Mr. Draper that if that was the way 
 the United States rewarded honesty, I assured him that if at any future time [ 
 detected any errors on their part I would not be in such a hurry to correct 
 them. Mr. Draper felt very indignant about the matter, and the case went on 
 for a fortnight before it was settled. I told Mr. Hanscom one day in his office 
 what I thought of the matter, and he afterwards expressed the determination to 
 fix that Jas. Myers, jr. This was the only wine seized on me here; but in 
 California they seized three hundred cases. 
 
 Q. Are these one hundred cases detained yet ? 
 
 A. Yes. 
 
 Q Have you learned anything about government agents visiting your Euro- 
 pean house ? 
 
 A. I learned by a letter from Peter Arnold Mumm, of Cologne, of some gen- 
 tlemen coming to buy wines from them, and representing themselves as confed- 
 erate agents. Mr. Mumm answered them that he had an agent in the United 
 States, Mr. Myers, and that he could do no business there unless through him 
 They went away, and about half an hour afterwards the landlord of the hotel 
 sent to Mr. Mumm, saying it was a mistake for the gentlemen to say they were 
 confederates, as they were English, and wished to buy the wines for the English 
 market. Mr. Mumm then referred them to his house in England, as the houses 
 in Reims and England are two different houses ; for though under the sam« 
 name the house in London buys the wines from the house in Reims and sells 
 them for whatever they please Therefore he had no right to do any business 
 in England except through the house in London. Mr. Schubert, one of the 
 partners in the Reims house, was in the office when the gentlemen came there 
 and represented themselves as confederates ; and in the evening he went to the 
 hotel, and in the strangers' book he found the names of Montgomery Gibbs and 
 Mr. Farwell ; one of the gentlemen was there at the time and the other had left 
 
NEW YORK CUSTOM-HOUSE. 
 
 253 
 
 for Pari?, There has been one letter presented in the court at l^n Francisco, 
 alleged to be an answer from Mr. Mumm. I wrote to Mr. Mumm to know if it 
 was from him, and he wrote me back that the Reims house never wrote such 
 a letter. I have sent to San Francisco for a certified copy of that letter. 
 
 New York, January 12, 1867. 
 HERMAN BATJER sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business ? 
 A. I am. 
 
 Q. What merchandise do you import ? 
 
 A. Wines and brandies. I have been in the business twelve years. 
 
 Q. What kind of wines ? 
 
 A. French wines particularly. 
 
 Q. Have you had any difficulties in entering your goods at the custom-house ? 
 A. Yes ; with our champagne wines, which were seized at the same time all 
 the rest were. 
 
 Q. Do you buy these wines or are they sent to you on consignment ? 
 A. They are sent on consignment. I am agent to the house. 
 Q. And you return the net proceeds after deducting your commission and 
 other charges ? 
 A. Yes. 
 
 Q. Have you ever purchased directly these wines? 
 A. No. - 
 
 Q. When you made your entries at the custom-house did you do so on the 
 invoice sent you by the shippers ? 
 A. Yes ; the very same. 
 Q. The same for a series of years ? 
 
 A. The same. I raised it once, some time since. I render an account of the 
 sales to the house, and the net proceeds for the last five years have averaged 
 fi\>m eleven to twelve per cent, less than what the invoice price is. 
 
 Q. Whether did they seize your wines or stop them ? 
 
 A. They seized them. 
 
 Q. What amount did they seize ? 
 
 A. I am the smallest importer here, and for a number of years only bought a 
 small stock. Lately the house said they would send me all the wines I wanted, 
 and I had 3,300 cases sent me and that was all seized. 
 
 Q. Have they been released ? 
 
 A. No. 
 
 Q. Do the custom-house hold them yet ? 
 
 A. We gave bonds for them and took them out. 
 
 Q. Has the case been settled yet? 
 
 A. No. 
 
 Q' Who are the lawyers you have employed ? 
 A. Webster and Craig. 
 
 Q. At whose suggestion did you employ them ? 
 
 A. I followed the example of the rest. They seem to be the only lawyers 
 here who can fight out the matter with the custom-house. In my opinion I 
 think they are the best lawyers in this case. 
 
 Q. Best for who ; for you, for themselves, or for the custom-house 1 
 
 A. 1 cannot answer that question. 
 
254 
 
 NEW YORK CUSTOM-HOUSE. 
 
 # NfiW York, January 14, 1867. 
 
 JOHN a! WALSHE sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you in the importing business? 
 
 A. I am ; I import wines on commission. 
 
 Q. Do you import different kinds of wines ? 
 
 A. I receive them on commission or on consignment. 
 
 Q. Have you had difficulties with the custom-house? 
 
 A. Yes, about champagne wines. 
 
 Q. When was thai I 
 
 A. In 18G4 — the same time that all the others had. 
 Q. Was your stock seized or detained at the custom-house { 
 A. I had 450 cases of wine seized and detaiued there. I afterwards bonded 
 them, and they are under bonds now. 
 
 Q. Why is not the c;i«* tried and brought to an issue ] 
 
 A. Since I was notified of the seizure I wrote to the owners, and employed 
 counsel. 
 
 Q. Who did von employ? 
 A. WebBter and Craig. 
 
 Q. What is the present condition of these seizures? 
 
 A. As I understand it, my house was ready to try the case, a< they have got 
 all their testimony from France. But the government was ool ready. I was 
 notified, about three weeks ago, to go to court, but the case was not tried. 
 
 Q. On whoee motion was the case put off"? 
 
 A. I believe it was made by the district attorney; he asked the judge to 
 postpone it to the next term. 
 
 Q. Who are the parties from whom you receive the champagne t 
 
 A. From the widow of Charles Farre. The leading member of the firm is 
 now dead, and the firm has been changed. 
 
 Q. W'ere these goods sent to you on consignment and accompanied by in- 
 voices ? 
 
 A. Yes. 
 
 Q. Was it upon those invoices you made your entries ? 
 A. Yes. 
 
 Q. Was there any question made about the valuation of the wines at the 
 custom-house up to that time ? 
 A. Never up to that time. 
 
 Q. Who first gave you intimation that the seizure was to take place ? 
 
 A. I was notified by Collector Barney. 
 
 Q. Were you not notified by a written or printed notice ? 
 
 A. If I remember right I was notified by a printed notice, stating, "your im- 
 portation by such vessel has been seized and detained." 
 
 Q. What steps did you then take ; did you go to the custom-house ? 
 
 A. I first employed counsel, and then I called for a reappraisement ; and 
 that reappraisement, if I remember right, put the wines at the same figure, if 
 not a little lower than they were invoiced at. 
 
 Q. What is the value of these 450 cases ? 
 
 A. The value appraised afterwards was $2,800, less the duty. The wines 
 were here some time, and part of them got damaged. 
 
 Q. Was there any offers made to you by your counsel or through them to 
 settle this 1 
 
 A. No. . 
 
 Q. Were there any suggestions made to you 1 
 A. No. 
 
NEW YORK CUSTOM-HOUSE. 255 
 
 New York, January 14, 1867. 
 
 EMIL KUNTZ sworn and examined. 
 
 By the Chairman : 
 Q. What is your business ] 
 
 A. I am a member of the firm of Henry G. Schmidt & Co., importers of wines, 
 brandies, &c. 
 
 Q. Do you import them on consignment or on purchase % 
 A. On consignment. 
 
 Q. How long have you been in the business % 
 A. Nine years. 
 
 Q. What kind of wines do you import 1 
 
 A. Champagne — Clicquot brand. 
 
 Q. Have you had any seizures by the custom-house ? 
 
 A. No. We received a telegraph from San Francisco stating that our invoices 
 had been seized. When we received that despatch we did not know what to 
 think of it, and we went around to the other Champagne agents, and they knew 
 nothing about it. We shortly after got another despatch giving us full particu- 
 lars of the seizure. We had then a consignment " underway," and considering 
 the number of seizures made, we concluded not to expose our wines to seizure 
 and we sent them to general orders as unclaimed goods. Knowing, the tariff 
 bill already passed would go into operation on the first of J uly, and that under 
 that we would have to pay less duty, we thought we would forego the pleasure 
 of selling during one month, until that should come into operation and have no 
 difficulties with our wine. Knowing some of our friends had their wines seized 
 at this time was an extra inducement for us to adopt this course. We did wait, 
 and on the 3d of July entered the wines under a specific duty. And since then 
 we had no difficulty. 
 
 Q. Since then you have had no difficulty; why so? 
 
 A. Because we raised our invoices to sixty francs. 
 
 Q. What was the valuation before ? 
 
 A. Forty-two francs. 
 
 On the 8th of October, I think, one fine afternoon, ten men came into our 
 office and showed us a warrant sworn to by a man named Money, who swore 
 we had smuggled goods. On this warrant they seized our books, papers and. 
 letters, and carried them off to the custom-house. They kept them there four 
 weeks, and left men in charge of the store : but the men they withdrew after a 
 fortnight. We employed as our lawyers Messrs. Tracy and Noyes — that is the 
 firm to which Curtis Noyes belonged. They went to the custom-house but 
 could get. no information or satisfaction. At last, Mr. Tracy told me he could 
 not get the books because they were not ready ; he said he could get them by 
 replevin, but there was no use in employing force, because they could do the 
 Same, and take them again. He said the warrant was not a legal warrant, but 
 that if we said anything against it, they could make it right, so there was no 
 use in disputing the case with them, but to try and get the case tried as quickly 
 as possible. 1 went soon after that myself to the custom-house, and said to 
 them it was a great inconvenience to us to have the books kept so long, and 
 that they might make an abstract of whatever they wanted and let us have the 
 books back. I remarked I would just as soon pay for copying what they 
 wanted. I thought nothing further of it, and some time after the books were 
 returned, and a bill sent us for $1S7 50 for copying. I showed the bill to 
 my lawyer, and he told me as I said I would pay for copying, I should 
 pay for it. Whether they did copy any or not I do not know. We could 
 get no satisfaction whatever from Mr. Dennison when we asked the cause of 
 complaint or anything else ; in fact he actually insulted us. Since then we have 
 
256 
 
 * 
 
 NEW YORK CUSTOM-HOUSE. 
 
 heard nothing fWni them, except that they sent us a capias claim — I think that 
 is what they call it — going back live yearn, for the amount of $80,000. 
 
 Q. When was tins ? 
 
 A. I think in October, 1865. 
 
 Q. Who did they send it through ? 
 
 A. Through the United States district attorney. 
 
 Q. Have they ever made you any proposal to settle ? 
 
 A. No. 
 
 Q. Directly or indirectly ? 
 
 A. No. In fact, if they did we would not listen to it. It has remained in 
 that condition since. 
 
 Astor House, \k\v York, February 1, 1S67. 
 
 CLEMENT HEERDT, being duly sworn, testifies as follows : 
 
 By the CHAIRMAN : 
 
 Q. Arc you in the wine business ? 
 A. Yes, sir. 
 
 Q. Do yon receive on consignment, or do vou purchase ? 
 A. Both. 
 
 Q. Have you had difficulties with the custom-house in your entries ? 
 A. Yes, sir. 
 
 Q. When was it, and state the circumstances? 
 
 A. I believe it was in the summer of 186-1 they raised our invoice ten per 
 cent, in champagne wine. We called for a reappraisement. The reappraise- 
 ment was granted, and I think the reappraisement was more than ten per cent. 
 
 Q. What amount did they seize in value ? 
 
 A. They seized two invoices, amounting to 160 or 170 baskets, and they 
 seized one invoice amounting to 330 or 340 baskets. 
 Q. What kind of wines I 
 A. Champagne wines. 
 Q. Whose manufacture ? 
 
 A. They were the wines of Deuty & Geldermann. 
 
 Q. What followed after the seizure ? 
 
 A. After the seizure we had them appraised. 
 
 Q. The appraisement was still above the ten per cent. ? 
 
 A. Yes, sir. 
 
 Q. Did you get the wines ? 
 A. Yes, sir ; by giving a bond. 
 Q. Is that yet in suit ? 
 A. Yes, sir. 
 
 Q. Has there been any attempt to settle or compromise it % 
 A. No, sir. 
 
 Q. Have you made any propositions to settle ? 
 A. No, sir. 
 
 Q. Have they to you ? 
 A. No, sir. 
 
 Q. Who conducts the suit professionally for you % 
 A. Martin & Smith, and Webster & Craig. 
 Q. Did they seize your books and papers 't 
 A. No, sir. 
 
 Q. Simply your wines ? 
 A. Simply my wines. 
 
 Q. Did you first employ Martin & Smith as your attorneys ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 257 
 
 A. Martin & Smith are my regular lawyer?. I gave it to them. I always 
 go to them. They found out that Webster & Craig had to defend a number 
 of other parties who had their champagne seized, and they proposed that I had 
 better give it to them — conjointly with them. I consider that I employ both. 
 
 Q. Were these invoices that were seized — were the valuations the same that 
 they had been on previous entries ? 
 
 A. Yes, sir ; for a long time. 
 
 Q. Did you receive any intimations before from the custom-house that the 
 valuations were too low ? 
 
 A. Several months previous to that we had imported some wine, and the 
 liquidation was delayed for a very long time. At first I did not notice, but I 
 happened to look and found that invoice was not liquidated, so I went to Mr. 
 Robinson, I think it was, and asked him how it was about this invoice. He 
 said that it had been liquidated yesterday. I then asked him what was the 
 reason they were so long about it. He then told me that there had been some 
 trouble in California, and they had been on the point of making trouble about it 
 here. I had a long talk with him about it, and he said we were satisfied that 
 the invoice went all right, and there would be no further trouble about it. That 
 conversation occurred somewhere in the month of May, and in the middle of 
 July or August, 1864, the other one came up. 
 
 Q. You gave a bond and got the wines released 1 
 
 A. Yes, sir. 
 
 Q. Why has it not been brought to trial 1 
 
 A. Our lawyer wanted to have it tried a month ago, and, I believe, the dis- 
 trict attorney refused to try it on the plea that some of the important witnesses 
 were absent in California. 
 
 Q. Has there been any correspondence, do you know, with your house abroad 
 and Mr. Farwell or Gibbs 1 
 
 A. I think not ; at least they never wrote to me about it. 
 
 Astor House, N. Y., January 31, 1867. 
 P. A. PERRIX, of the firm of Lalance & Grosseau, being duly sworn, testi- 
 fies as follows : 
 
 By the Chairman : 
 Q. Are you in the wine trade in this city 1 
 
 A. No, sir, principally in the importation of hardware. We are the agents 
 for some champagne in France for the United States aud Canada. 
 
 Q. Have you had any difficulties with the custom-house in getting those 
 goods through ? 
 
 A. Not recently ; we had formerly when the new duty came into operation. 
 It was just after the duty of six dollars a case was put on champagne. 
 Q. What was the nature of that difficulty? 
 
 A. They detained our goods on account of what they called undervaluation. 
 Q. How did you release them ? 
 
 A. I think it was by bond ; we had some seized here, and some in California. 
 
 Q. Have you paid any money to procure the release, or have there been any 
 propositions made to you to that effect ? 
 
 A. No, sir. Is there any chance of getting justice done us in regard to them ? 
 There are one hundred persons ready to prove that the wines are not under- 
 valued. I have offered that proof to the parties. We are ready to take any 
 amount of orders for the wines delivered at the price we have invoiced them. 
 That I could not do if they were undervalued. We are willing to take the val- 
 uation put upon these wines in France at public auction, provided the wines are 
 H. Rep. Com. 30 17 
 
258 
 
 NEW YORK CUSTOM-HOUSE. 
 
 offered in such quantities as we are in the habit of shipping. It is not by send- 
 in- an agent to France and buying one bottle or two bottles that you can as- 
 certain the value of it. 
 
 Q. lias that been done? 
 
 A. Yes, sir; by Mr. Farwell. 
 
 Q. Was it upon his information that your goods were detained? 
 
 A. It was in San Francisco. We have done business since 18-52 in New 
 York, and I think our record in the cu-tom-house is good. We felt that we 
 were aggrieved in this matter. We never entered undervalue and never inten I 
 to do so. Now, we have a bond of $5,000 in California in a case that is to come 
 to trial yet, about this wine. 
 
 The CHAIRMAN : You asked a moment ago if there was any chance of getting* 
 justice done. 1 can hardly tell you. I desire to have this thing come to an 
 end, and hope it will. 
 
 Astok IIoi sr, N. Y., January 31, 1867. 
 
 THEODORE STEHN, of the firm of Stehn cV Woolping, being duly sworn, 
 testifies as follows : 
 
 By the Chairman : 
 Q. Are you in the importing trade here ? 
 
 A. Yes, sir ; wines and liquors. I receive them on consignment, and purchase 
 them too; I had some difficulty with the custom-house about one year and a 
 half ago. 
 
 Q. What did that difficulty arise out of? 
 
 A. They confiscated some champagne that we had on consignment from 
 Eugene Clicquot. 
 
 Q. What were they confiscated for, as you term it ? 
 A. They told us it was for alleged undervaluation. 
 Q. Were they valued as they had been all along ? 
 
 A. Yes, sir ; all of the same quality and of the same value as the custom- 
 house had received them for a number of years. The invoice on which we en- 
 tered them was the same as the one we sold on; we had but one invoice. They 
 seized about 800 baskets ; I got the goods released on a bond ; I employed 
 Webster & Craig as counsel ; I cannot tell when the case will come to trial ; I 
 understand it will be tried next March. 
 
 Q. Who are the consignors of the main bulk of these wines ? 
 
 A. The consignor was Eugene Clicquot in Reims. It was his article which 
 he had consigned regularly to me for many years at the same price. 
 
 SEIZURES OF SHERRY WINES OF SPAIN. 
 
 New Y/ork, January 10, 1S67. 
 
 J. S. BEECHER sworn and examined. 
 
 By the Chairman : 
 Q. What is the name and business of the firm of which you are a member ? 
 A. Ives, Beecher & Co., importers of wines and teas. 
 Q. How long have you been engaged in that business ? 
 A. In this city about twelve years. 
 
 Q. Were your goods, books, papers, or stores seized at anytime by the reve- 
 nue officers ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 259 
 
 A. "We had our books taken about the middle of last November. I am not 
 certain about the time exactly. 
 
 Q. Do you know at whose instigation 1 
 
 A. I only know that Colonel Van Brunt came into our place accompanied by 
 four men and quietly took their seats and distributed themselves about in different 
 parts of our office. He showed us a paper which was on the information of some 
 man living in Brooklyn. I do not now remember the man's name, but we found 
 he was a man of no account. The affidavit of this man was that he believed we 
 were making or entering goods under the valuation. Mr. Van Brunt said he 
 wanted to take our books and papers. We were not aware there was such a 
 law as that ; but he told us there was ; and we said if that is the law here is 
 our safe, &c. They then took everything they wanted — the majority of our 
 books, letters, letter-book, and in fact whatever they wanted. They also searched 
 the whole place. After they had the books about a week or ten days, we were 
 advised to employ Webster & Craig ; we did so and stated our case to them. 
 They asked us if we wanted to settle it. I will say here they did not seize any 
 goods of ours ; at least, we never had a notice sent us. But if we wanted our 
 goods and offered to pay duty it would not be received, because, as was said, 
 there is some trouble in the invoices. Where the goods were duty paid, the 
 officers would say they had instructions from the collector or other official not 
 to deliver any of these goods for the present. But whether they seized the goods 
 or not, I do not know. We had $70,000 worth of one style of wine in bond — 
 a low sherry. After they had kept our books for ten days we supposed they 
 would give them back, but they did not. I then went myself to see Mr. Smythe. 
 He said it was a matter over which he had no control at all. He said when a 
 man informed on a merchant the orders came from the Secretary of the Trea- 
 sury, and he himself was only doing his duty when he was putting this law 
 into effect ; that some of his best friends also had goods seized, and he had to 
 treat them the same way. When I saw Webster & Craig, I was asked what 
 we wanted to do. I said we wanted to get possession of our books, and also to 
 continue our business and try and dispose of our goods. They said, " This thing 
 can be settled ; if you want to settle it we can settle it in twenty-four hours; we 
 never had a case we could not settle." We consulted among ourselves, and 
 considered we bought these goods at a high rate of gold — gold averaged fifty 
 at the time we bought them — and as the gold market then was on a decline, 
 if they kept our goods locked up until gold fell to thirty before we sold them, 
 it would oe a serious loss to us ; besides the loss of our business for the time, 
 as we were not doing any business worth speaking of. We finally asked Mr. 
 Craig to see on what terms it could be settled for, and what the trouble 
 was. In regard to these wines, I want to say, we bought them in this mar- 
 ket. We enter the goods in the custom-house, taking the owner's oath, in 
 order to put the goods into our own warehouses. When the goods arrive 
 here we take the invoices from Messrs. Galway & Cassado, the agents of the 
 foreign house. We then take the owners' oath, and say we are the bona fide 
 owners of the goods — this is a mere matter of form ; and when the wines are 
 gauged and the bill made out, we settle with them, deducting the duty. 
 Mr. Craig said, " The trouble is, you have sworn to the cost of an article as 
 being the real cost, (that is, the invoice,) and then you turn round and, after 
 the goods are gauged and delivered to you, you pay more than that to Galway 
 & Cassado ; you are paying them more than you said the wine was actually 
 worth." " Weil," said I, " we do." " Well," said he, " why do yon do that? " 
 I replied, " Because Ave could not obtain the wine in any other way except 
 through them." Said he, " You see, the situation of the case is this : you have 
 taken an oath which, on your own showing, is not correct ; you pay more for 
 an article than you say you do." The house of Lacaoe & Ecbecopar pay a 
 commission on the Side to their agents, Messrs. Galway & Cassado. ISow, if we 
 
2G0 
 
 NEW YORK CUSTOM-IIOUSE. 
 
 were to write to Cadiz, and order 500 casks of wine — crown sherry — they 
 would refer us to their Rgentf in New York, saying they transacted anything 
 tliey did here. I was myself in their office in Cadiz twice, and found we could 
 not order any wines from them unless we agreed to sell the wines here at a cer- 
 tain price! in order not to break the market down. The juice of the wine is 
 SI 10 pel gallon, duty paid. We said to these men, that is, to the agents here, 
 " Suppose we take, in the course of the year, a large amount of wine, would 
 you not make a discount to us lower than to other parties ? " They answered, 
 "Yes; we will give you a discount of live per cent, if you take 2,500 quarter 
 casks a year." We said we would do so. Now, when we want to order wines, 
 we write a letter to Caluay & Cassado saying, "Please order, on our 
 account, by the first vessel, 500 casks," or whatever quantity it might be. 
 When the goods arrived, and were landed and gauged, then we would settle 
 their bill at our convenience. That is how we got the wines from them. Mr. 
 Craig said, " You stand in a different light from Calway <5c Cassado, because 
 they are commission merchants ; and when they take an oath, they take the 
 consignee's oath : and if the goods are w orth double, they are not supposed to 
 know it. Now>" said he, 44 this thing can be settled. And then," he said, 
 44 there is the invoice of the claret wine." This was a wine which some man 
 consigned to us, and Bent the invoice; and, at the same time, he said, "These 
 wines I expect to get more than they are invoiced for; they are worth more, 
 but I will invoice them at so much, and you must hold it until you get so 
 much." I have it yet. I only sold ten cases, because I could not sell it at the 
 price he wanted. Mr. Craig said, 44 These little things look bad, and I would 
 advise you to settle it, if it can be done satisfactorily." Said I, "How can it 
 be settled I " Said he, 44 It can be settled for $60,000." 44 Well," said I, 44 we 
 will not do it at that; the wines are worth only §70,000." He said they could 
 give us a great deal of trouble, and he advised us to settle it. After two or 
 three days he wanted us up again, and I went up to his office and saw him. 
 He said he talked to Mr. Smythe, and it could be settled for 645,000. I said I 
 would like to settle it, but not at that price. The next day he called upon us, 
 and said that he had seen Messrs. Hanscom, Smythe & Wakeman again, and 
 the $45,000 would settle it; and he did not know but 840,000 would. I said I 
 Would not pay any such thing as that, lie said, 44 Do you not know if you settle 
 this you get all these things duty free. You will get a free permit, and have no duty 
 to pay on them." I thought that was an object to look into, and I considered 
 it, and found the duty was $11,900 or $12,000. «We had at this time 1,600 
 casks taken for the year, and wanted to take 900 more to get the percent- 
 age. So we went to the agents, and asked them if they would give us the 
 live per cent, on what we had. They thought of it for a day or two, 
 and agreed to do so. That percentage, with the duty free on the wines, 
 would come to about 823,000. Mr. Craig then wanted us to make an offer, but 
 he said there was no use in offering much less than $45,000. After we 
 figured the thing up, and found we would have 823,000 to our credit, 
 we offered them $30,000. He reported; and said again, when he 
 came back, that Mr. Smythe and Mr. Wakeman said they would meet 
 us half way and come down to $40,000. After awhile they came 
 down to $35,000. We considered for a few days, and found if gold went 
 down to thirty, it would be better for us to have our goods sold before then. 
 We also knew that all the wines in the city were locked up, and as they said 
 they would at once give us our wines, and we could get it in the market, we 
 could get fifteen cents a gallon increase, as we would have the market to our- 
 selves. And we thought the whole thing together would be a good trade for us, 
 although we thought it would be a hard case, too. We gave them a check for 
 $35,000. They had made out. all the permits, and when we handed them the 
 money they gave us the permits, and Ave got possession of our goods the same 
 day, and they gave us our books within an hour. 
 
NEW YORK CUSTOM-HOUSE 
 
 261 
 
 Q. "Was that $35,000 in gold or in greenbacks ? 
 
 A. In greenbacks. Of course the government lost the duty. We would have 
 paid the government, if we paid the duty, about $12,000 in gold. 
 
 New York, January 11, 1S67. 
 
 GEORGE MILX sworn and examined. 
 
 By the Chairman : 
 Q. You are engaged in the importation of wines % 
 A. Yes. 
 
 Q. State your experience in that respect. 
 
 A. I have been since 1822 in the business, and never had any difference with 
 the custom-house until lately. 
 
 Q. State what that difficulty was. 
 
 A. Of late there has been much trouble caused by a suspicion that the wines 
 have been invoiced too low. My last shipment of wines was raised from $16 to 
 S20 by the appraisers. I was surprised, and immediately called on the collector 
 for a reappraisement. He appointed his own appraiser, without giving me an 
 opportunity of appointing one on my part. However, I was satisfied to leave 
 it in the hands of -the gentleman appointed. After three weeks I found my in- 
 voice was pronounced to be correct. 
 
 Q. What time was this ? 
 
 A. About two months ago. I have always understood that when a reappraise- 
 ment is called the matter was final. To my surprise these goods have since been 
 seized, and also all my wines in different stores. 
 
 Q. What is the amount of your importations per annum ? 
 
 A. I import about 10,000 casks. Part of the goods seized I had paid the du- 
 ties on, and the entries had been liquidated, and they were sold to third parties, 
 who now find their wines seized. Shortly after the reappraisement of the wines, 
 to my surprise a party of officers came to the store and took possession of all 
 my books and papers, and carried them to the custom-house, where they were 
 detained for more than a month. I went to the custom-house and found the 
 books under examination by Mr. Hanscom and by Mr. Far well, (who, I understood, 
 was United States foreign revenue agent.) And I find by my letters from Spain 
 that this same Mr. Farwell has caused a great deal of trouble in the matter of 
 the importation of wines. In all my importations the invoices have beeu regu- 
 larly certified by the consul, and they had always been considered correct by 
 the custom-house until recently. 
 
 Q. Has the custom-house known all along what these invoices were ? Had 
 they been always produced to them and remained with them ? 
 
 A. They were always produced to them and remained with them. 
 
 Q. Which did you enter these wines, as owner or agent % 
 
 A. As agent. 
 
 Q. Who has fixed the valuation of the wines as you entered them ? 
 A. The appraisers. 
 
 Q. But you enter them upon an invoice valuation properly attested by the 
 consul % 
 A. Yes. 
 
 Q. Do you know anything else of the valuation of these wines ? 
 
 A. Well, I have seen wines differ in the market value — that is, have consid- 
 erable deflections from time to time. And I have seen the wines that come into 
 competition with mine, but they were invoiced at the same price. 
 
 Q. Then these wines deflect in value and price ? 
 
 A. Very much. 
 
 Q. As you do this business as agent or commission merchant, give the com- 
 
2:2 
 
 NEW FORK CUSTOM-HOUSE. 
 
 mittee the details of your connection with this hous< — tli.it is, the returns yon 
 make and the charges you deduct from tin* invoice price of the wines, and how 
 you arrive at the net proceeds of the returns you make. 
 
 A. These wines are shipped to us on consignment, and after I sell them here 
 I deduct the duties, freights, insurance-:, and storage, and all other charges, such 
 as exchange and commission, and deducting all these shows the net proceeds 
 here. And I remit these net proceeds. 
 
 Q. I- there a certain fixed amount you are invariably to remit ? 
 
 A. No. 
 
 Q. Do these gentlemen give you carte-blanche to get what you can for them 
 and return them the proceeds ? 
 
 A. Yes ; tin y have full confidence in my doing them justice, and they leave 
 me full power to dispose of them. They have sometimes lost, hut of late we 
 have made very fair profits for them in consequence of the great rise in the duty 
 on wines. 
 
 Q. What kind are those wines ? 
 
 A. The low est grade of what we call sherry wine. 
 
 Q. Who do you receive them from ? 
 
 A. From Lacave cV Echecopar. 
 
 Q. After you found your books under examination by Farwell what took 
 place ? 
 
 A. I called frequently to get back my books, and found they were not done 
 With them. In the meantime some wii.es which I was selling, and for which I 
 had a private permit, were stopped. After this they stopped the wines alto- 
 gether, and they were stopped for six weeks. 
 
 Q. What is the present situation of the case? 
 
 A. It is now in the hands of the court. We had to make our appearance in 
 court. 
 
 Q. Have you been approached to settle this matter ? 
 A. No. 
 
 Q. Have you been advised to employ anv person to settle it ? 
 A. No. 
 
 Q. Who is your counsel ? 
 A. Webster & Craig. 
 
 Q. Who suggested to you to employ them ? 
 
 A. They are generally reputed the best lawyers to fight a battle with the 
 custom-house. 
 
 Q. Did they suggest to you that the matter had better be settled ? 
 A. No. 
 
 Q. What is the amount under seizure now ? 
 A. Two thousand four hundred cases. 
 Q. What do they claim on them ? 
 
 A. They have not given me any intimation what they want. 
 
 Q. Did you get your books and papers back, or do they hold them ? 
 
 A. I got my books back ; but they hold part of my papers still. I may as 
 well state that the wine trade is entirely suspended, the house in Spain having 
 stopped all shipments. 
 
 New York, January 14, 1S67. 
 
 L. E. AMSINCK sworn and examined. 
 By the Chairman : 
 
 Q. Have you been in the wine business in this city ? 
 A. Yes. 
 
NEW YORK CUSTOM-HOUSE. 
 
 263 
 
 Q. "What is your experience of the business ] 
 
 A. It is such that if Congress does not pass another law I will go out of it. 
 Q. What is the trouble ? 
 
 A. I really don't know. On the 11th of November some parties from the cus- 
 tom-house came to my office and took the books away. I sent for my lawyer, 
 and he brought us to Webster & Craig, as he himself was not acquainted with 
 the custom-house business. 
 
 Q. What did they seize your books for 1 
 
 A. I am not aware. We got our books back in about a week. But since 
 that time they have not allowed us to deliver any wines out of our stock, except 
 one quarter cask that Mr. Seward wanted, and they allowed us to send that. They 
 have not seized the stock. 
 
 Q. What claim did they make ? 
 
 A. No claim whatever. 
 
 Q. Did they serve you with any notice ? 
 
 A. No. 
 
 Q. Have the wines been examined ? 
 
 A. They were examined on their arrival by the appraisers, and found correct ; 
 but notwithstanding that, I am not able to get them. 
 
 Q. How do you know they were examined and found correct ? 
 
 A. Because we got the liquidation of the entries as correct. 
 
 Q. Why did you not on your liquidation certificate demand the wines, and 
 ask to receive them ? 
 
 A. I could force them into some action, but not wishing to have trouble, I 
 expected they would release them without taking any other steps, as there is no 
 ground for their seizure. 
 
 Q. What sort of wines are they % 
 
 A. Sherry wines. I have two large lots which, under these circumstances, I 
 could not enter, and, therefore, they are in general order stores. 
 Q. Did your lawyer get any information for you ? 
 A. None. 
 
 New York, January 14, 1S67. 
 PHIJXIPE CASSADO sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you in the importing business ? 
 A. Yes. 
 
 Q. Do you receive consignments of wines ? 
 A. Yes. 
 
 Q. Where do you get them from? 
 A. From Cadiz and Malaga. 
 
 Q. Had you any difficulties in entering these wines ] 
 A. Yes. 
 
 Q. What are the circumstances 1 
 
 A. On the 25th of October, eight or ten men came into our office with an 
 order to take our books. We delivered the books to these agents of the custom- 
 house, and my partner went down and saw Mr. Smythe and told him we had 
 been in this country twenty-five years and he was surprised he should be treated 
 in such a way. Mr. Smythe said he could not help it, that intimate friends of 
 his own were similarly situated, and that he should follow the instructions of 
 the government. He said if we had clone nothing wrong our books would be 
 returned to us after examination. We expected that after they were examined 
 
2C4 
 
 NEW YORK CUSTOM-HOUSE* 
 
 th<'y would be returned with an apology, because there was nothing wrong. 
 They kept them over a month before we got ihem. We are suing the collector 
 
 for havitlg taken our books and papers. They look our private papers and all 
 the books and papers they could find. We told the men then; were BOme pri- 
 vate papers there, and tin y said if tin re were any they would be returned. 
 thought it' this was the law of* the country we would give up business and go 
 live somewhere else. Judge Bates has not yet given a decision whether the 
 seizure of our books and private papers was unconstitutional or not. The col- 
 lector has commenced a suit Ibr -SloO.OOO or £^00, 000, on the ground that wines 
 imported by us for some time past had been undervalued ; that the agents of 
 the government had been in Spain and knew we had been invoicing our wines 
 for less than they were worth. We are going to defend it, and have sent sev- 
 eral times to the Secretary of the Treasury that we want to have the case tried 
 as soon as possible, and he has promised it will be so. 
 
 Q. Did they take all the books and papers in your office? 
 
 A. They took every book, paper, and letter they could get. 
 
 Q. And examined them for the last ten years? 
 
 A. 1 suppose they did ; they could if they wished. They could see the 
 amount we received and the amount of money we returned. And they could 
 also see that no two invoices returned the same amount. Mr. Iwourra, agent 
 of the house, who is here, will give you more information on the subject. 
 
 New York, January 14, 1S67. 
 
 P. P. ESCOURRA sworn and examined. 
 
 By the Chairman : 
 Q. What is your business ? 
 
 A. I am a clerk in the house of Lacave & Echecopar. 
 Q. How long have you been here ? 
 A. About thirty days. 
 
 Q. Had your house any difficulty with the United States customs here ] 
 A. Yes. 
 
 Q. State what the circumstances are. 
 
 A. In the last vessel in which we sent wine to this country we sent some 
 wine which the consul at Cadiz refused to certify the invoices of. 
 Q. On what ground % 
 
 A. On the ground that they were undervalued, although he had previously 
 stated that he had orders from his government to certify any document pre- 
 sented by Lacave & Echecopar. 
 
 Q. Do you know anything about Mr. Farwell or Mr. Montgomery Gibbs? 
 
 A. In June a geDtleman came to our office in Spain without any kind of an 
 introduction, and inquired about good sherry wine. Mr. Lacave told me, if I 
 was not busy, to attend to him and show him the cellars, and in the mean time 
 he would have some samples prepared to show him. I took him around the 
 cellars, and when we came to the largest one, in which there were a number of 
 quarter-casks quite new, he asked me if they were not intended for the United 
 States. I told him I was not employed in the cellars and did not know; but 
 that I presumed from the marks on them they were intended for that market. 
 He asked me the price of a quarter-cask, and I told him SI6. I then took him 
 back to Mr. Lacave, who had the samples prepared to show him. He said, we 
 ship large quantities of that wine to the United States, but only for large trans- 
 actions; and he also asked him for what purpose he wanted the wine. The 
 gentleman answered, he wanted two samples — one for a friend in New York, 
 
NEW YORK CUSTOM-HOUSE. 
 
 265 
 
 and another for a friend in San Francisco. Mr. Lacave then asked him whether 
 he wanted the wine for business transactions, or for private use — his own use. 
 He did not answer that question, hut said he wanted the wines tried by his 
 friends. Mr. Lacave then said, there is no use in your receiving that very low 
 sherry. And he then said he wanted to see a good sherry ; and Mr. Lacave 
 showed him samples running from $1 25 to $5 a gallon. After trying them he 
 said he really did not understand anything about the difference in the wines ; 
 and Mr. Lacave told him that it would be difficult even for a man who had been, 
 like himself, thirty-five years in the business, to do so. Mr. Lacave himself 
 then fixed on a wine worth about $3 a gallon for him ; but at the same time 
 told him it was better for him to wait some time before taking that wine, as the 
 present duty was an ad valorem one, and we were expecting an alteration in 
 the tariff, according to advices received from our agents. Said the gentleman, 
 then, suppose I take these wines notwithstanding the high duty, can you not 
 invoice it less than it is worth here, so that I may gain a little on the duty 1 
 Mr. Lacave in my presence answered: "Your custom-house is very strict upon 
 these matters ; and besides, it is not the character of Lacave & Echecopar to 
 act in that way." Mr. Farwell then did not say anything ; and Mr. Lacave 
 observed, I had better fix some samples for you and send them through 
 our agents in New York, Galway &; Cassado. He agreed to that, and left an 
 address in New York — Mr. Wells, Merchants' Hotel. The samples were sent 
 to our agents here at the prices stated to Mr. Farwell. The two cases of sam- 
 ples amounted to about $12, and we wrote to our agents to receive the money 
 from Mr. Wells, and charge him with the duties and other charges. Mr. Wells 
 came himself to the office of our agents, when they told him that Lacave had 
 sent the samples ordered by his friend from the house while he was travelling 
 in Europe. Mr. Wells said, "I don't know who the samples could come from 
 except from Mr. Farwell." And that was how the agents discovered the name 
 of the detective that had been sent out by the United States. About five days 
 after we received the visit from Mr. Farwell, we received a letter from a gentle- 
 man in Bordeaux, named Samuel D. Jones, asking us about the prices of the 
 sherry we usually sent to the United States; but he was answered the house 
 did not sell these wines in Cadiz, but consigned them to their agent in the 
 United States ; but as the wines were for Canada they would enter into the 
 transaction with him. They then gave him a list of their prices, stating that 
 for one thousand quarter-casks it would be $16 50 per quarter-cask, and for 
 five hundred it would be $17. He replied to that letter by ordering eight 
 quarter-casks to be sent to London — one quarter-cask of each sort of the eight 
 different kinds they usually sent to the United States. We sent the eight 
 quarter-casks by the first steamer to London; and, as we did not know any- 
 thing about him except that he wrote to us last from the house of John Mon- 
 roe & Co., from Paris, we sent the bill of lading with our indorsement to that 
 house, and wrote to Mr. Jones that he should not think it strange that we sent 
 the bill of lading to them instead of to him, as it was in a business way. We 
 inquired from Monroe & Co. further information about the gentleman, as he did 
 not give us his residence. They answered us that they knew nothing of the 
 gentleman ; but that the amount of the eight quarter-casks would be paid to our 
 agent in Paris. On presentation of the invoice it was paid. 
 
 Q. How long have you been in the employ of this house in Spain 1 
 
 A. About six years. 
 
 Q. Do you have anything to do with their books 1 
 A. I correspond for them. 
 
 Q. Do you know the nature of the trade with this country now ? 
 
 A. This trade first was a matter of experiment, and required a series of ex- 
 periments to find a low grade wine that would stand this climate and suit 
 the American trade. It was actually a loss to the house for a series of years. 
 
266 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Bat at last, they succeeded in manufacturing an article that would suit the cli- 
 mate and please the tastes of the people ; and now the reputation of the house 
 is established, and the trade makes fair returns for the investments. 
 
 Q. What is the valuation fixed upon these wines; is it variable or invariable? 
 
 A. It is always the same. 
 
 Q. How is that; does not the price of the must, or raw juice, vary ? 
 
 A. Yes, it does, but we buy the juice in different parts of the country. When 
 the price of must in one part gets too high for our business with the United 
 States, we go for it to such a part as we can get it lower. In this way our 
 crown sherry always costs us about the same figure. 
 
 Nkw York, January 14, 18G7. 
 JOSEPH BEXSUSAX, Jr., sworn and examined. 
 
 By the Chairman : 
 Q. Are you a citizen of this country? 
 A. No. 
 
 Q. Are you interested in business in this city? 
 
 A. Yes. I ship wines here from Cadiz. 
 
 Q. What kind of wines ? 
 
 A. The lowest grade of sherry wine. 
 
 Q. What house or houses do you ship to here ? 
 
 A. We consign them to Wallace Co., and Phelps & McMillan. 
 
 Q. You send or consign the wine to these houses for sale ? 
 
 A. For sale on our own account. 
 
 Q. You make out au invoice and have it certified by the American consul at 
 Cadiz ? 
 
 A. He used to certify them ; but of late he has refused to do so, and has 
 given no reasons for his refusal. 
 
 Q. Did he ever say he acted under instructions from Gibbs or Farwell ? 
 A. No ; rather from private instructions. 
 Q. Who is that agent ? 
 A. R. P. Farrell. 
 
 Q. Is he engaged in business there ? 
 A. Xo. 
 
 Q. Are these wines manufactured ? 
 A. Yes. 
 
 Q. How do you get at the prices put upon them in the invoices ? 
 
 A. We prepare wines in our cellars for all countries, as each market has its 
 wine prepared in different style. For this country we have a vat of wine of a 
 year or two's growth, and we add to that other liquors. To the cost of the 
 wine we add the expense of preparing it, the labor and carriage to place of 
 shipment, and to that we add 10 or 15 per cent., and in this way we arrive at 
 the cost of the wine. We take our crude wine or the pure juice of the grape, 
 and we add to it a certain portion of sweet wine and brandy, and submit ih6 
 whole to a clarifying process to make it brilliant, and when prepared in that 
 way we pass it from our vats to the quarter-casks, in which it is sent to this 
 country. We take a certain amount of crude wine and value it at so much. 
 Then we charge the quantity of sweet wine and brandy added, and add the 
 labor, and that is the cost of the wine; and we add 10 to 15 per cent, for profit. 
 We invoice it at $16 a quarter-cask, which is 12 or 14 per cent, over the actual 
 cost, labor and shipping and other expenses there, and is a fair return for our 
 capital. 
 
 Q. What is the trouble with the custom-house ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 267 
 
 A. We had about 1,000 quarter-casks stopped, some here and some at Bos- 
 ton. I went to Boston and called on our agents there, and learned that they 
 had employed as counsel Mr. Lothrop. I conferred with him on the subject, 
 and he said he was confident of success ; but there is no certainty of the time 
 the case will be tried. We had wines in tbe last two ships, and we have sent 
 them to the general order stores. 
 
 Q. What is the point made against you at the custom-house ] 
 A. Undervaluation. They say the wines were invoiced with intent to de- 
 fraud the revenue of the United States. We are ready and willing to submit 
 to them any proof they want. The wines seized are already in a cloudy state, be- 
 cause wines of this grade cannot stand great change of temperature, and have 
 already lost their brilliancy. Other invoices of ours were also seized — one of 
 one hundred and sixty quarter-casks, value between two and three thousand 
 dollars. 
 
 Q. Are they still under seizure ? 
 
 A. They are all under seizure. 
 
 Q. What is the prospect of their being released ? 
 
 A. I cannot ascertain any. I called on Mr. John McKeon, and on Messrs. 
 Webster & Craig, and none of them can give me [any information. These gen- 
 tlemen are my lawyers. It seems there are wines detained two or three years 
 in the custom-house, and no decision has been given on them yet. 
 
 Q. When were your goods seized 1 
 
 A. In May or June, 1866. 
 
 Q. You never had any seizures before ? 
 
 A. No. 
 
 Q. Have there been any propositions made to you to settle ? 
 A. No. 
 
 Q. Have you or your house known Mr. Montgomery Gibbs, or Mr. Farwell, 
 so-called treasury agents ? 
 
 A. I thought at the time I came here we had no calls at our office or cellars 
 by any government commissioners. But conversing with Webster & Craig 
 they told me agents had bean visiting the wine cellars in our district and cor- 
 responding from Paris. This brought to my mind a correspondence that a man 
 named Samuel D. Jones, who represented himself as from Montreal, Canada, 
 had with our house. He wrote to us under the auspices of John Monroe & Co , 
 of Parie bankers. He inquired for the prices of our wines, as he intended them 
 for Montreal, and he wished to know the prices of our wines, such as we shipped 
 to New York — our crown sherry brand. We informed him, but gave the prices 
 a little higher. We said we shipped quarters at $16 and octaves at $17 ; but 
 this was with the understanding that it was for the Canada market. He wrote 
 again to us, and we gave him $17 as the prices for quarters or octaves at his 
 option. He received our letter and wrote again requesting us to send him sam- 
 ples of our wines — one quarter-cask and one octave, and to send them by 
 steamer, which we did. For three or four months we did not hear from Sam- 
 uel D. Jones, and we wrote to Messrs. Monroe to inquire about his character. 
 They wrote back that they knew no such person, giving reference to them. I 
 thought this thing had no reference to the matter until talking with Webster 
 & Craig. 
 
 Q. Did Samuel D. Jones pay you for the wine you sent ? 
 A. No; I never heard any more of the individual. 
 
 Q. How do you connect Samuel D. Jones with either of the United States 
 treasury agents, Gibbs or Farwell? 
 
 A. When Webster & Craig told us the United States agents were visiting 
 our cellars and corresponding from Paris, our correspondence with Mr. Jones, in 
 Paris, came to my memory at once. I am not positive now, but I think either 
 of these lawyers, or some one else, told me Mr. Jones was connected with Mr. 
 
2G8 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Jordan, ill Washington, The letter we received from Pari* WBM written L0 
 Monroe's office, and had tin: stamp of their office on it, and it directed us to ad- 
 dress him in their care. Tt was not a direct reference to them. 
 Q. What was the value of the wine ? 
 
 A. $25. When our correspondent wrote to us first about these seizures, we 
 were sure the thing would be easily explained, and for that reason we did not 
 interrupt our business ; and since then we have sent $50,000 worth of wine out 
 here, because we feared nothing, as we knew there was nothing wrong, and, as 
 I said, we did not for a moment stop our business, and now, instead of that, we 
 find there is going to be trouble about the matter. The consul in Cadiz does 
 not assist us. We can get no satisfaction from him, as he is a man of disagree- 
 able maimer and character. 
 
 NBW York, January 15, 1SG7. 
 DANIEL V. ARQUIMBAU sworn and examined. 
 
 By the Chairman' : 
 Q. Are you in business in this city? 
 A. Yes. 
 
 Q. Are you in the importing business? 
 A. Yes ; we import wines from Spain. 
 Q. Were any of your wines seized \ 
 A. Yes. 
 Q. When? 
 
 A. In 1865; when they began to stop the rest. 
 
 Q,. Have there been offers to compromise made to you ? 
 
 A. No ; but it was said to me that I could settle it some way or the other. 
 
 Q. Who said it to you ? 
 
 A. I could not say. 
 
 Q. Were they seized for undervaluation ? 
 
 A. Yes. The first thing I heard was that 170 quarters and 178 octaves had 
 been raised ten per cent. I called for a reappraisement, and two months after I 
 called for it a notice was sent me that on the 11th of September, at 2 o'clock, 
 the reappraisement would take place. I took Thomas McMullen with me as a 
 witness, and at the appraisers' office I met Judge Hogeboom. He told me he 
 had a headache, and that the other appraiser had a sore-throat, and that the 
 reappraisement should be postponed. The wines are already beginning to get sour. 
 I have also two invoices, lately received, which the consul at Cadiz refused 
 to certify. He said he wanted to see the wines, and they brought him a sample 
 of them. He said they were worth more than the valuation they put on them. 
 They offered to bring him proof, but he would not have it. They, however, got 
 them certified by two other consuls — the consul of England and another. I 
 brought the invoices to Webster & Craig when I received them, but they told 
 me I could not enter them without the certificate of the American consul, so I 
 sent the wines to general order stores. Three or four days ago I went to Wetfc 
 ster & Craig with Mr. Bensusan, and I was told Mr. Craig was going to write 
 to the Secretary of the Treasury to allow these wines to be entered at the custom- 
 house valuation. I said I would not do so, because the value on the invoices 
 was the true one, and that it was not our fault if the American consul refused to 
 certify them. He said that he would write to the Secretary. I said he could 
 do what he pleased, but that my friends on the other side would not accept that val- 
 ation. I had another lot of wines imported in 1864, and which were liquidated, and 
 we paid on part of them ten per cent, fine for not having paid the duty within a 
 year. These wines were also seized, but as they were sold a long time before 
 
NEW YORK CUSTOM-HOUSE. 
 
 269 
 
 to Thomas McMullen, and he wanted the wines, I requested Webster & Craig 
 to give bonds for these fifty-two quarter- casks. The other wines went to general 
 orders, as I had not been able to make my entries. 
 
 Q. What is the condition of these wines now ? 
 
 A. They are getting into a cloudy or muddy condition. 
 
 Q. Suppose they are in this condition, how does it affect their value ? 
 
 A. Suppose their market value to be Si 10, when they begin to get cloudy 
 we cannot get a dollar for them; and when they are muddy we cannot get 
 eighty cents for them, and when they are sour 1 don't know what I could get. 
 
 Q. When they get sour is there no way of bringing them back to their original 
 condition ? 
 
 A. No. The reason we refuse to give bonds is, because they are consign- 
 ments. If they should get sour in our hands, of course we should be responsible 
 for them. For that reason we don't want to give bonds, but prefer to leave 
 them in the hands of the government. 
 
 New York, January 16, 1867. ] 
 
 THOMAS McMULLEN sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you in business here ? 
 
 A. I am, as a wine importer and wine dealer. 
 
 Q. How long have you been engaged in this business? 
 
 A. I have. been engaged in this business in this country for twenty years. 
 
 Q. Do you receive wines on consignment ? 
 
 A. I receive some wines on consignment, but I am not a very extensive 
 dealer. My business includes wholesale and retail. 
 Q. Had you any difficulties with the custom-house ? 
 A. I had not directly, myself, but I had indirectly. 
 Q. State the circumstances. 
 
 A. I purchased a lot of wines from a house in this city — a lot of wines at 
 certain prices, subject to an ad valorem duty. I did not think the wines were 
 at all a bargain at such a price. I said, as I did not want all the wines, I would 
 pay duty on some of them, and leave the balance remaining in bond. I then 
 withdrew a portion of them, and shortly after I withdrew a little more. I with- 
 drew all except a balance of fifty quarters. When next I wanted to draw some 
 of these I went to the house to tell them of it, and they then told me they were 
 seized by the custom-house. I said that was very extraordinary, as on the last 
 lot 1 drew I had to pay ten per cent, beside the duty. I was told I would 
 have to make an affidavit that I had purchased the wines from this house and 
 had paid duty on some of them. I did so, but cannot get my wines. I said to 
 the gentleman from whom I bought the wines, " they are not your property, 
 they are mine." He said the wines were taken for undervaluation. I said if 
 that was so the house was responsible. He said the house was not respon- 
 sible, as I could have taken all the wines out when I took a portion of them. 
 I answered that the house made the original entry, and if there waa anything 
 wrong then they were responsible. I could buy the wines cheaper now if I 
 wanted to buy them. The wines have been there now eighteen months, and 
 though, as I stated before, I have withdrawn a portion of them, yet the balance 
 is still detained. I could buy the wines cheaper now if I wanted to buy 
 them. And although they say they were undervalued, if I could have made 
 ten per cent, profit on them any time since I bought them I would have sold 
 them. If I could make five per cent, profit now I would take it at once. I 
 
270 
 
 NEW YORK CUSTOM-HOUSE. 
 
 could buy now better wine for less than what I paid for them. I will here 
 state that more than once I heard official men say that their salaries, were not 
 enough to live upon. 
 
 Q. The salaries of whom ? 
 
 A. The Balariei paid the officers. 
 
 Q. What officers do you mean? 
 
 A. 1 mean in the internal revenue. 
 
 ( v ). I supposed you had reference to custom-house officials? 
 
 A. What J had in my mind just now referred more directly to internal rev- 
 enue. A broker in the custom-house, speaking a night or two ago of the 
 champagne seizures, said he had a case some time before, where goods were 
 seized for undervaluation. He called at the custom-house to know the cause 
 of the seizure, and he was told it was for undervaluation. lie went back to 
 the house, and told them so, and they showed him the prices of the goods. He 
 then said, I can get my lawyer to get them for you, but it will cost $25 or $30 
 to do so. They were satisfied. The broker then went to the officer, and offered 
 him $25, which he said he may as well give to him U to the- lawyer. The 
 officer then said, " take away your wines, it is a small thing." 
 
 I myself think they don't much care about making seizures of these small 
 things, and that it is only the large cases they go on. 
 
 SEIZURES OF SWISS RIBBONS, SILKS, ETC. 
 
 New York, January 16, 1867. 
 GUST AYE KUTTER sworn and examined. 
 
 By the CHAIRMAN : 
 Q. Are you in the importing business ? 
 A. I am. 
 
 Q. How long have you been in business 1 
 
 A. I have been in business eighteen years, but I am a partner of this firm 
 only since 1854. 
 
 Q. What kind of goods do you import 1 
 A. Silks, ribbons, and dress goods. 
 
 Q. Do you purchase abroad, or do you receive on consignment ? 
 
 A. The majority of our goods we receive on consignment; but we purchase 
 where we cannot get them on consignment. 
 
 Q. Whether was it your purchased or consigned goods that were seized by 
 the custom-house ? 
 
 A. The difficulties we had were about the last lot of consigned goods we re- 
 ceived. 
 
 Q. Were the goods seized ? 
 
 A. Yes ; our books, papers, and letters were seized. 
 
 Q. State when this was, and the circumstances attending it. 
 
 A. I cannot swear to the date, but it was the end of August. I was down 
 town, when a clerk of mine sent me word that the custom-house officers had 
 taken possession of our store. Before going back to the store I went to our 
 lawyers, Martin & Smith, to ask them what I should do. Mr. Martin told me 
 I could do nothing then. I went back then to the store and found that our 
 desks had been opened, and our private papers aud letters had been taken out, 
 the books taken away, and an officer left in charge of our store. This was done 
 on the affidavit of a man named Bostwick. I went down to see Mr. Smythe, to 
 
NEW YORK CUSTOM-HOCSE. 
 
 271 
 
 know the reason, but could get no satisfactory answer from him. We were not 
 allowed to deliver any goods without the consent of the custom-house. When 
 our books had been away from us for about a week I went again to ask Mr. 
 Smythe why they were seized, and he said they were seized by an order from 
 Washington; there were informations against most of the importers, and our firm 
 was among the number. I told him that it was very hard. He said that all had 
 to go to the captain's office to settle. I claimed from him our books, as they were 
 necessary for us to carry on our business. He said I would get them with the 
 least possible delay. I then called on Mr. Franklin. When I called he had 
 the books and letters before him, examining them. He found a trifling difference 
 in some invoices, which I explained to him. The books were returned to us a 
 few days after, because they found everything correct. I then went to Wash- 
 ington and saw Secretary McCulloch. I told him it was a serious matter for 
 us, as we were a young house and our business was mainly a matter of confi- 
 dence in us, and I asked him to appoint a commission to inquire into the mat- 
 ter. I said that if the commission found that the information received from Eu- 
 rope was correct we would submit to the seizure of our goods ; but that if they 
 found the information came from a person who did not stand very high we 
 would respectfully ask that the question be submitted to an extended committee 
 and the matter judged on its own merit. But I said that this seizure of goods, 
 on information submitted by Mr. Far well, was wrong. 
 
 Q. How did you know that Farwell had anything to do with it 1 
 A. Mr. Smythe told me the information came from Washington, direct from 
 Mr. Farwell ; and, also, at Washington, in the department, they mentioned that 
 Mr. Farwell was their agent in Europe, and that the Solicitor to the Treasury 
 had very great confidence in him. The Secretary of the Treasury told me it 
 was a case that did not come under his control. I was then sent to Mr. Ed- 
 wards, and I stated my case to him, but he could give me no satisfactory an- 
 swer ; but it was fully admitted that Mr. Farwell and Mr. Gibbs were their 
 accredited agents. The Secretary also told me if we were right the law would 
 show it, but if we were wrong we should suffer. I then came back and told 
 Mr. Smythe I had been unsuccessful, and I telegraphed to Europe to stop the 
 shipments, because Smythe told me they would proceed against all goods 
 against which there was information. I telegraphed the following message : 
 " Upon information from Europe, difficulty with custom-house. Stop sending 
 goods at present." They wrote us back that they would not stop as there was 
 nothing wrong. They said they presumed the difficulty came from a letter 
 they had written, of which they sent us a copy. They stated a gentle- 
 man called on them, giving a reference to a house in London, and asking the 
 prices of their goods. They, believing that he wanted to smuggle the goods 
 into the United States through Canada, thought they would have nothing to do 
 with him, and to keep him away from them they thought it would be very 
 clever to ask him 25 per cent, higher prices than were usual ; and they did keep 
 him away, as he never came back. They then wrote to the house in London 
 to whom he referred, and the house answered that the gentleman had no right 
 to refer to them. I have copies of the correspondence, which are at your dis- 
 posal. They also had a letter from Mr. Jones, written from Lyons. When I 
 had the last conversation with Mr. Smythe he told me that Mr. Farwell had 
 written him a letter, stating that he would claim his share of all moneys which 
 were recovered on all seizures of goods on which he had informed. We have 
 given bonds to get possession of our goods, and we are now preparing testimony 
 to show that the goods were invoiced at the market value. 
 
272 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Xi.w York, January 10, lSo'/. 
 GUSTAVUS KUTTER recalled and examined. 
 
 By the Chairman : 
 
 Q. AY hat do you know about the change that was made in the cartage 
 business ! 
 
 A. We were notified by our customs clerk that he would not be held respon- 
 sible to us for any damaged goods which would be stored in bond. 
 Q. What do you mean by damaged goods ? 
 
 A. Well, when a vessel arrives with goods which go into a bonded warehouse 
 they have to be examined to see whether any of them are damaged by sea- 
 water; and if so, the insurance companies must be notified within ten days. 
 Our carman generally made this examination, and it any goods were damaged I 
 would go down myself when he reported the matter to us. I also held our cus- 
 toms clerk responsible for them. \Ve instructed him to look at the goods and 
 report to us when they left the ship, and what bonded warehouse they went to. 
 Then he; gave me this notice that he no more should be held responsible on ac- 
 count of this change which took all control away frOm him and from the car- 
 man. I then went to see the collector, and called on him three times without 
 being able to see him. The fourth time I went to see him he told me to speak 
 to his private secretary, Mr. Molton, and tell him what I had to say. I told 
 Mr. Molton, and he said to me that Mr. Smythe was so busy he could not attend 
 to the verbal complaints of the merchants, and he requested me to put my com- 
 plaint on paper and bring it down to him. I then wrote the following letter, 
 and although he said I would get a prompt reply to it, I have never received an 
 answer : 
 
 Gl AID 03 Worth Street, 
 
 October 16, 1866. 
 
 Sir : We respectfully beg to draw your attention to the following, in regard to an order 
 prohibiting importers from riding their goods from general order stores to the respective 
 bonded warehouses, thinking, as no doubt do all the other importers, that it will not be for 
 our interest if the order is carried out. 
 
 The steamer City of New York, October 11 arr. October 12. We sent our warehouse 
 permit to the steamer, but found our goods had already gone under general order. In such 
 instances — the steamer having discharged immediately after arrival — we are allowed by the 
 steamship company to deduct the amount of storage from the freight bill, giving them 
 as a voucher the storage bill receipted by the storekeeper, which we cannot do if a strange 
 carman is employed to ride our goods to the warehouse. And we have also always relied on 
 our carman to inform us in such of our cases as are warehoused have been damaged on 
 the voyage of importation : and it is not probable that a carman interested only so far as his 
 cartage is concerned would trouble himself to find out whether the cases were wet or not. 
 
 And we also rely entirely upon our carman to bring our goods immediately from the 
 general order store, as should a fire occur we might sustain a serious loss, and it is not to be 
 doubted that at times our goods, if left to a strange carman, will remain under general order 
 a week or probably weeks uninsured, while we naturally suppose they are in the warehouse 
 to which we have ordered them to be sent. 
 
 Trusting you will consider what we have written and grant us the privilege of riding our 
 own 2,-oods, we remain, awaiting your kind reply, respectfully yours, 
 
 K.. L. & Co. 
 
 H. A. Smythe, Esq., 
 
 Collector of the port — Present. 
 
 P. S.— Our carman is qualified under the law, and has a shield and gave bond of $5,000. 
 
 It was very much to our interest to have our own carman employed, for we 
 could always depend on him to examine our goods carefully, which we could 
 not depend on a strange carman to do. And also if we were not advised 
 promptly where our goods were stored we would be apt to lose the time for our 
 insurance. For these reasons this change in the cartage business did not meet 
 our approval. 
 
NEW YORK CUSTOM-HOUSE. 
 
 273 
 
 Astor. House, N. ¥., January 31, 1867. 
 HENRY J. BARBEY", being duly sworn, testifies as follows : 
 
 By the Chairman : 
 Q. Are you in business in this city ? 
 A. Y/cs, sir ; in the importing business. 
 Q. What kind of merchandise ? 
 A. French, Swiss, German, and Italian goods. 
 Q. Have you had any difficulties with the custom-house 1 
 A. I had in August last. 
 Q. State briefly what they were. 
 
 A. The first news that I had of it was, six, seven, or eight gentlemen walked 
 into my store and told me, I think, that they had a warrant to seize all my 
 stock. They read me two warrants — one for the seizure of my books, and the 
 other for the seizure of my stock. They took charge of the whole building. 
 
 Q. They were from the custom-house ? 
 
 A. Yes, sir ; they were custom-house officials. They took my books down 
 to the custom-house, and left two officers in charge of the building. The officers 
 remained, I think, six or eight days — about a week. 
 
 Q. Did they entirely stop your trade % 
 
 A. I cannot say that it was stopped altogether ; but my trade was very 
 much stopped by this fact, that they required me to have the invoice of whatever 
 goods I sold checked at the custom-house by some officer there. It was cur 
 busiest season. 
 
 Q. What excuse did they give for taking this course with you ? 
 
 A. They did not give me any pretext at the time, if I remember right, but 
 I understood it to be from information that they had received from the other 
 side with regard to the goods shipped. 
 
 Q. Was it the allegation or charge for undervaluation of your goods when 
 you entered them in the custom-house ? 
 
 A. Yes, sir. They had goods sent from the other side on consignment; 
 those goods were alleged to be undervalued, and on some information from 
 Europe the goods were seized and my store occupied. 
 
 Q. How was it finally arranged? 
 
 A. It is not arranged yet. I am getting proofs about it. The goods that 
 have been seized by the custom-house officers, I have given bonds for the mar- 
 ketable value cf them, and now I am goin^ to defend a suit iu the United States 
 district court, and I am getting information from Europe in regard to the value 
 of the goods at the time they were shipped. 
 
 Q. What is your knowledge and belief as to the correctness of the invoice ? 
 
 A. I have proofs in my hands now that I submitted informally to the authori- 
 ties in Washington. I took steps in Washington to prevent further seizure of 
 our goods, and I have got a sworn statement in my hand, before the lord mayor 
 in London, and before the United States consul, that the goods were sold at 
 the time they were shipped to me at the same price, or even a little under. 
 
 Q. How long did they keep your books and papers ? 
 
 A. I think a week. 
 
 Q. Did they seize your private papers 1 
 
 A. Yes, sir, everything ; even my will, and my wife's letters to me. 
 Q. Did they take those? 
 
 A. I don't think they took those. They took a lot of private papers and 
 memorandums of mine ; they had hold of my will and marriage contract and 
 my letters to my wife. 
 
 Q. Those, you say, on your informing them, they left ? 
 
 A. Yes, sir, I think they had some private papers ; I could not watch all 
 R. Rep. Com. 30 18 
 
274 
 
 NEW TORE CUSTOM-HOUSE. 
 
 these men at one time; I watched the one who was at the safe, and I think I 
 stopped him from taking any of those valuable paper-, to me; while I was 
 working at the sale, they wore working at my desk — they had my wife's letters. 
 
 Q. Do yon know anything ahout the correspondence of your consignor! 
 abroad concerning the government agents there I 
 
 A. Yes, sir ; J got copies of most all of them, and I sent my partner immedi- 
 ately to Europe; he lias come hack, and of course he confirms what they told 
 
 us. Some of them had conversations with the revenue officers ; others gave 
 written statements of their prices. 
 
 Q. Did you have any of your goods, books, papers, &c, seized previously ? 
 
 A. Yes, sir; I had some g Is seized in lt>G'.; : I think that is the only in- 
 stance. They were goods consigned by the manufacturer from Switzerland. 
 Allow me to remark, it was on differ* nt information this seizure of last fall Was 
 made; it .was made on information received from Km ope, and llii.- case 1 am 
 talking ahout, of lSG.'i, was seized on information from the public store here. 
 
 Q. How was that Bettled I 
 
 A. We paid a certain amount and the goods were released. 
 Q. "Who did you employ as counsel there ? 
 A. Wehstor & Craig. 
 
 Q. Did you employ them the firs! tim ■ ? 
 
 A. In this particular case, no, sir; if I remember right, in that case we had 
 D. C. Waldon, on the recommendation of the custom-house broker. lie told 
 me to go to this man. 
 
 Q. Then you substituted Webster Craig? 
 
 A. Yes, sir, my partner did. 
 
 Q. Why did he do it ? 
 
 A. I think 1 went down to the custom-house and complained of the action 
 that was taken in this matter, and one of the officers there suggested that Mr. 
 Craig would be more the man to attend to that; that he was more familiar with 
 the custom-house business). 
 
 Q. Do you recollect who it was ? 
 
 A. If it was any one it was Mr. Hanscom, who is in the seizure department. 
 Q. How much did you pay in that instance ? 
 A. On the 3d of February, 1S65, I paid 815,000. 
 
 Q. That was on information obtained at the appraiser's store, you say ? 
 A. 1 think the goods came in the store ; they were thought to be under invoice. 
 Q. What were these goods ? 
 A. Ribbons. 
 
 Q. What is your belief about it now ? were they undervalued ? 
 
 A. I think they were. There is another case, I think, where there was a 
 seizure made. It was an invoice of goods from Europe — samples sent to know 
 if they suited the market. They were unmarketable goods on the other side, 
 and they sent them to us to know what would be the marketable value of them 
 here. I went down to the custom-house and I submitted the samples to the 
 custom-house appraisers, and asked them what they thought those goods were 
 worth here. They told me a certain price, and I wrote back to the other side 
 the conversation that I had with the custom-house officers, and told him to in- 
 voice his goods about eight per cent, higher than the price named by the custom- 
 house. The goods were shipped here, and when they arrived they were seized. 
 
 Q. Do you remember who told you what they would be valued at here ? 
 
 A. I think it was one of the custom-house appraisers, either Mr. Savage or 
 Mr. Holmes. The goods were seized, and by paying tw r enty per cent., I think, 
 the owner of the goods got them back. 
 
 Q. Is there any other case ? 
 
 A. That is all I remember. 
 
NEW YORK CUSTOM-HOUSE. 
 
 275 
 
 Astor House, N. Y., January 31, 1867. 
 JOHN J. THOMAS, being duly sworn, testifies as follows: 
 
 By the Chairman : 
 Q. Are you in the importing business ? 
 A. Yes, sir. 
 
 Q. What goods do you import 1 
 
 A. Mostly millinery goods — raw silks, ribbons, &c. 
 
 Q. Have jou had any difficulty with the custom-house in such importations 1 
 
 A. Yes, sir ; several times. 
 
 Q. Did you purchase or receive consignments 1 
 
 A. Only consignments. 
 
 Q, Do you make your entries at the custom-house from their invoice ? 
 A. Yes, sir. 
 
 Q. Do your consignors send you a different invoice, or have they done so ? 
 A. No, sir. 
 
 Q. When did any of these difficulties occur ? State the date and circum- 
 stances. 
 
 A. In September, 1S6G, I received several cases of silk ribbons, which I en- 
 tered upon the original invoice. They said they were undervalued from seven- 
 teen to twenty per cent. 
 
 Q. Did they seize your books and papers 1 
 
 A. No, sir; they only detained the goods. 
 
 Q. How was it finally settled ? 
 
 A. It is not settled yet. The goods are there yet. The amount of goods 
 seized is about 85,000 francs. 
 
 Q. Have they made any proposition to you to settle % 
 
 A. Not directly; indirectly they said a couple of thousand dollars would 
 fetch them. 
 
 Q. Who said that ? 
 
 A. One of my salesmen told me that ; I did not think much about it. 
 Q. Have there been any propositions made to your counsel to settle ? 
 A. Not that I know of. 
 
 Q. You have spoken of having previous difficulties with them — did you settle 
 any of them ? 
 
 A. Yes, sir ; I settled some of them. 
 Q. How were they settled % 
 
 A. Made a compromise with them. They fixed the amount that I was to 
 pay at about $7 or $S,000, which they took in order to release the goods. 
 
 Q. Why were these previous seizures made — for undervaluation ? 
 
 A. Yes, sir ; the same thing. There is nobody in the United States who can 
 appraise raw silk. It ta^es a man from his childhood who can give an idea of 
 the value of silk — I mean the raw silk twisted in thread. I made a compro- 
 mise, but I ought not to have made it. They also took my books and papers. 
 
 Q. How long did they keep them ? 
 
 A. Three or four days. 
 
 Q. Your private papers 1 
 
 A. Everything that was there. 
 
 Q. Who was it made the proposition, then, upon which you settled ? 
 
 A. I think it was Mr. Hanscom. 
 
 Q. What did he propose to settle for ? 
 
 A. Between $7,000 and $8,000. 
 
 Q. Was that the first offer ? 
 
 A. Yes, sir. 
 
 Q. You finally paid it ? 
 
276 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. JTefli sir; because I wanted by books back. My business was stopped. 
 I could not receive any money. It entirely stopped my hu.-iness. 1 would 
 have paid $20,000 to get my books and papers. I sent them the money asked, 
 and then I g< t my books and goods, but I considered it a real swindle. 
 
 Q, Then you have had several seizures made? 
 
 A. Only those two. 
 
 Q. One is settled, and the other is still in suit ? 
 A. Yes, sir. 
 
 Q. You are not going to settle that I 
 A. No; because I am right. 
 
 Q. There has been no other suggestion except the one you have spoken of 
 through the salesman ? 
 
 A. No Other. The trouble is this, that I have got another lot of goods 
 worth 60,000 francs under general order, and I have got to wait for them until 
 this suit for the sixteen cases, amounting to 85,000 francs, is settled? 
 
 Q. When is that Bait going to be tried .' 
 
 A. 1 cannot say. They are taking affidavits in Europe. 
 
 Q. Are you ready to try I 
 
 A. Not ready yet. 
 
 Q. How came these seizures to be made — from information given in Europe ! 
 
 A. There was a person by the name of Farwell who went to Europe to the 
 manufacturers of the goods, and passed himself as a Canadian, from Montreal. 
 They knew a good many goods were Bmuggled from Canada to the United 
 States. These goods are never sold to the United States. They are sent by 
 consignment, and they gave him very high prices of the goods. 
 
 New YTork, January 14, 1S67. 
 
 E. BURCHARDT sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business ? 
 A. I am salesman in the house of Christ, Jay & Co. 
 Q. What kind of goods do they import ? 
 A. Ribbons and goods of that class. 
 Q. Do they import them on consignment or sale? 
 A. On consignment. 
 
 Q. Has there been any seizures of these kind of goods ? 
 A. Y'es ; in September last. 
 Q. For what w r ere they seized ? 
 A. For undervaluation. 
 
 Q. You went to the custom-house to see about it ? * 
 A. Yes. 
 
 Q. AYhat are the circumstances of this case 1 
 
 A. The goods seized were parts of different invoices. There were three 
 cases seized from one invoice, and two cases from another. The two cases were 
 in the public store and remained there some time. I asked our broker why they 
 were kept there so long, and he said they were put in there for re-examination. 
 I was much surprised, as these two cases had already been passed in the cus- 
 tom-house, and the appraisers must have been satisfied with the price. The 
 other three cases I had already sold in good faith, and therefore could not send 
 them to the public store for examination as they required. In the mean time I 
 got eleven cases by different ships, which I sent to the bonded warehouse, not 
 knowing what to do with them. I got a hint I could enter them, and I did so 
 
NEW YORK CUSTOM-HOUSE. 
 
 277 
 
 about four weeks ago. But for these five cases I gave bonds, and tliey are the 
 only ones now in litigation. 
 
 Q. Why are these five cases detained ? 
 
 A. On account of the difference in price between the invoices and the prices 
 these two government detectives got abroad. 
 
 Q. What did you do when you went to the custom-house ? 
 
 A. The first step I took, was, I went to the collector with a memorandum 
 showing that part of these goods were invoiced at the samp, price as Mr. Cow- 
 den's were; and that at the same time they took a large order from Mr. Claflin, 
 in which there was only a difference of four per cent, between his and mine. 
 They sent these goods with a certificate from the consul that they were correct ; 
 and with a copy of this I went to the collector to show him the goods were not 
 undervalued. The difference between the prices they gave, and the prices 
 given by these two detectives, was about twelve per cent. Now the manufacturers 
 say that if these detectives came there for goods and claimed a reduction of eight 
 per ceut. on them, they would allow it to them, and then the difference between 
 the prices they returned, and the prices we returned, would only be four per 
 cent. After this I had to wait about ten days, when I got a hint that I might 
 enter the eleven cases. But, as I remarked, the five cases are still in litigation. 
 
 Q. Did you ever see Gibbs or Farwell % 
 
 A. No. 
 
 Q. The five cases are detained on the representation of these detectives ? 
 A. Yes. I only got one kind of goods ; and the five cases which are de- 
 tained are of the very same kind as the eleven that they passed. ' 
 
 New York, January 14, 1S67. 
 
 JAMES DORLER sworn and examined. 
 
 By the Chatr.Max: 
 Q. What is your position ? 
 
 A. I am a member of the "firm of Escher & Co. 
 Q. What business do you do. 
 
 A. We are importers of silks, ribbons, and Paris goods — dress goods, de- 
 laines &c. 
 
 Q. How long have you been in that business 1 
 A. Since 1831. 
 
 Q. Have you had difficulties with the custom-house ? 
 A. Yes. 
 
 Q. When was that ? 
 
 A. In October, 1S65, I got notice from the custom-house that the goods that 
 were in the custom-house were seized. I went down to see the collector, and I 
 could not see him. I went then to Mr. Clinch, deputy collector, but he said 
 that he had nothing to do with it, and that I should see Mr. Han?com. I 
 asked him to introduce me to him, and he did so. I said, "Mr. Hanscom, 
 I am here thirty-five years and never had one cent wrong before. From the 
 notice I received I see the goods were seized for undervaluation, and I w r ould 
 like to know what is the matter." When the goods were imported we entered 
 them, and they were taken to the public store and were examined, and sent 
 back to the warehouse as "all right," and the invoice passed by the appraiser. 
 And I thought it strange that they should seize them months after they had 
 been examined and found correct. I asked Mr. Hanscom to tell me how 
 they had found that they had been undervalued. He said that some person 
 had been sent to call on the manufacturer from whom our goods came, and that 
 he asked more for these goods than we had in the invoice. I asked him then 
 
278 
 
 NEW YORK CUSTOM-HOUSE. 
 
 whether lie had Beet) the goods, as there were two qualities of goods. He said 
 
 lie had not seen my goods; but that tin* seizure had been made on the strength 
 
 of representations made to him. I said I i bought it hard that goods found to 
 be correct should be seized lie said, " by the by, we have something else 
 against you; we are going to seize some ribbons that came to you from a house 
 in Basle." Said I, "if you find fault with them, 1 doubt your information." Bo 
 he smiled, and the clerks around smiled; and I asked "what do you laugh at?" 
 "Well," said he, "the man that gave that information stands before you." 
 •'Well," said I, "I am anxious to know how you got that information; you 
 say the manufacturer asked you much higher prices than we pay." 
 Q. What did he say the informer's name was? 
 
 A. Farwell. He said he gave his name to the manufacturer and gave an 
 address to a London hanker, and also to a Paris banker, and so found out the 
 prices. He did give his name to the manufacturer as coming from Montreal, 
 and the manufacturer thought to himself, 1 will fix this fellow, as he is one of 
 these fellows thai are smuggling goods through Canada to the United Stales, 
 and I will name prices so high that he will not take them. So be named enor- 
 mous prices to him, and it was on the strength of thes.e prices so asked by the 
 manufacturer thai he seized our goods. My goods were invoiced ten per cut. 
 higher than those of any other imp titer, and I asked Mr. H inscorn to examine 
 the invoices of any other importers in New Fork and if mine were not higher 
 than them, then they could take my goods. 1 asked him two days afterwards 
 if he had looked at the oile r invoices, and he said he had, and that ours were 
 higher. But he said that did not alter the ease, as Mr. Farwell had set down 
 the proper price at 25 per cent, higher. 
 
 Q. Were these goods sent to you on consignment or purchase ? 
 
 A. That house sends all its goods on consignment. Goods have been passed 
 since at a lower valuation. 
 
 Q. Since October ? 
 
 A. Yes. 
 
 Q. Why did they seize yours then ? 
 
 A. On the strength of Mr. Farwell's information. 
 
 Q. But why don't they act on that in these cases ? 
 
 A. That I cannot undei*3tand. 
 
 Q. What became of these goods? 
 
 A. We gave a bond and got them out, but it took me two months to get them. 
 Q. On what valuation did you pay 1 
 
 A. On their own valuation. Mr. Holmes was their appraiser and I had 
 another, and the two agreed in the market price, and on that amount I paid the 
 duty, because I entered them for consumption. They made me give a bond for 
 the whole amount, not deducting the duty. So if I lose the case before the court 
 I will have to pay the duty twice. • 
 
 THE STURSBERG CASE. 
 
 New York, January 11, 1866. 
 H. STURSBERG, of the firm of H. N. A. Stursberg & Co., importers of 
 woollens, sworn and examined. 
 
 By the Chairman : 
 Q. How long have you been in business here ? 
 A. Since 1847. 
 
 Q. Have you been always in the woollen business ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 279 
 
 A. No ; I changed the business from importing to domestic goods. I am 
 now substantially in the domestic business, and have been some time, more or 
 less. 
 
 Q. Have you had an}?- difficulty in the custom-house in entering goods ? 
 A. No. 
 
 Q. Had you not recently ? 
 
 A. Well, I had this single case. I had no others. 
 Q. When did that occur? 
 
 A. In October, 1865. One afternoon in the month of October, a warrant 
 was brought into my store and the officers seized my books, papers, and all that 
 was there. At the same time I found a letter written to me from the lawyers 
 Webster and Craige, offering their services in case I had trouble with the custom- 
 house. I accepted them, having employed them in several matters some years 
 ago, and as I thought they would be the best to arrange this business. After 
 the books were seized, I was called down before the naval officer, Mr. Franklin, 
 to the custom-house, who wanted an explanation in regard to the charge. He 
 asked me about some memorandums, having a good many of the papers that 
 were seized before him, as a certain discrepancy existed between those memor- 
 andums and the original invoices. The memorandum was dated August 30, 
 1865. Having our business mark in their possession, they f umd a difference of 
 between four and five per cent, between the invoices and this memorandum, 
 which was for our salesmen alone, and as a help to influence them in getting as 
 high a price for the goods as possible. Now, the difference between our memor- 
 andum and our invoices I can explain to you. They were our Austrian goods, 
 which were brought to Berlin and there included in one general invoice for ex- 
 portation, in doing which we converted the Austrian currency, which is a paper 
 currency, into Prussian money, which was on a ^old basis, and in converting 
 the Austrian paper money into this Prussian currency it represented exactly 
 what was stated in the invoices. The only interview 1 had was with Mr. 
 Franklin, who had, as I remarked before, all the papers and memorandums 
 before him, and I believe that in not one single instance was I in the wrong. 
 The same evening the warrant was sent I went Mr. Odell, the naval officer. 
 He was an old friend and acquaintance of mine ; I considered him so much a 
 friend that when he was proposed as a candidate for the position of the sub- 
 treasurer, I offered to be one of his sureties. I stated the case to him, and he 
 told me he had hesitated for weeks in giving out that warrant, because he was 
 convinced there could not be anything wrong; that they had taken at the cus- 
 tom-house during his time there my invoices as a standard of value. He prom- 
 ised that if nothing wrong was found against me I should have no further 
 trouble and should receive my books as quick as possible, and he advised me to 
 see him soon again ; however, I did not go down to him again. Some persons 
 came to me and said there was a case settled, and that they thought this could 
 also be easily settled. Being at that time in business where my credit was all 
 and everything to me, I wanted it settled as privately as possible to prevent it 
 going before the public. After a few days' negotiation my lawyers told me a 
 large amount would have to be paid, and they asked me if they should settle 
 it ; I was in such a state of excitement at the time that I said, " Settle it as 
 well as you can, so that I shall hear no more about it." I was advised by my 
 lawyers, during the progress of this matter, not to see Collector King, or any 
 other person. The first intimation I had of the adjustment of the matter was 
 a notice which I received from the clerk of the United States district court, 
 notifying me that Messrs. Webster & Craige had appeared and confessed judg- 
 ment against me for the sum of $64,412 50, and the same day I paid that amount in 
 greenbacks. My lawyers told me that the custom-house had a right to go back 
 for five years, and charge a penalty of $5,000 on each invoice which was under- 
 valued, and which would have amounted to millions ; but on account of my 
 
280 
 
 NEW YORK CUSTOM-HOUSE. 
 
 business I was glad to acquiesce in the settlement they made. When they took 
 the books, letters, &C., from me they were letters from the manufacturer to the 
 commission merchants or consignee where they often expressed a wish to get 
 such and such prices. If you compare such a letter as that with the real in- 
 voices there is a difference. Such a letter as that they might have seen when 
 they took my papers. But this is very easily explained, because the apprais- 
 ers al the custom-house knew that it was not possible lor these classes of goods 
 to be brought here at such a rate. "Webster »\ Craige told me that all the dif- 
 ference they found was between four and live pec cent. ; that is the difference 
 between the invoices and the memorandum. 
 
 New Yon*, January 11, 1SG7. 
 
 J. A. BARBKU sworn and examined. 
 
 By the CHAIRMAN : 
 Q. "What is your business ? 
 
 A. I am a member of the firm of Barber, Wilflon & Co., wine importers, of 
 this city. 
 
 Q. What do you know about custom-house matters here 1 
 A. On the l^!th day of .J urn- last, I landed from the steamer Etna from Liv- 
 erpool and I was en route for California. Two gold watches were taken from 
 me by an inspector of customs, Mr. Van Brunt, who told me I had better see 
 Mr. Hanscom about them. One of the watches was in my vest pocket ; and 
 the other was in my pantaloons pocket with the invoice and certificate of the 
 maker. I did not deny having them when spoken to : and I told him also that 
 my old watch, bought fourteen years ago in California, was in my trunk. I 
 applied frequently for them; and finally released them by paying *27G, which 
 was an extreme valuation. I also signed a paper to the effect that I would never 
 bring a suit for the recovery of the money, or to some such purport. 
 
 New York, January 11, 1S67. 
 THOMAS H. OAKLEY sworn and examined. 
 By the Chairman : 
 
 Q. "Where is your place of business ? 
 A. No. 257 Canal street. 
 Q. What is your business ] 
 A. I am a hat manufacturer. 
 
 Q. Were you the informer in the case of Stursberg & Co. 1 
 A. Yes. 
 
 Q. How did you get that knowledge or from whom did you get the knowledge 
 on which your information was laid against that firm ? 
 
 A. I cannot anwer that ; I don't think I ought to answer it. 
 Q. Why not ? 
 
 A. It is something I don't think it would be to the interest of the government 
 to answer. 
 
 Q. Do you represent the government or this committee ? 
 A. I suppose this committee does. 
 
 On the question being pressed, witness answered : I got it from a clerk. 
 That is as far as I can say. 
 
 Q. What was he clerk to ; or to whom was he clerk ? 
 A. I will not answer that. 
 
NEW YORK CUSTOM-HOUSE. 
 
 281 
 
 Question pressed by the chairman 
 
 A. I decline to answer that question, where I got the information or whom I 
 got it from. 
 
 New York, January 16, 1867. 
 THOMAS H. OAKLEY recalled and examined. 
 
 By the Chairman : 
 Q. Who was the clerk who gave you the information in the case of Stursberg 
 & Co.? 
 
 A. He was a clerk in a mercantile house. 
 
 Q. Did you receive the informer's share of that seizure ? 
 
 A. I did. 
 
 Q. From whom ? 
 
 A. From Mr. Ogden, the auditor of the custom-house. 
 Q. Do you recollect the amount he paid you ? 
 A. A little short of $16,000. 
 
 Q. Did you then, or at any time since then, directly or indirectly, give or 
 pay or cause to be paid any portion of that to any person in the custom-house 
 or connected with the custom-house I 
 
 A. No. , 
 
 Q. Have you any reason to believe any one else did ? 
 A. No. 
 
 Q. Did you not divide your portion with the clerk that gave you the informa- 
 tion? 
 
 A. I gave him some of it. 
 
 Q. Did he give any portion of what he got to any person connected with or 
 in the custom-house. 
 
 A. Not to my knowledge. He and I divided ; but I have no knowledge 
 that he divided a cent with any other person in the world. 
 
 Q. Do you know how or where he got the information he communicated to 
 you, or whether he derived it from the custom-house ? 
 
 A. I do not know. 
 
 Q. How did he come to give you the information ? 
 A. I was acquainted with him before. 
 
 Q. In conversation with you on the subject did he say he got any informa- 
 tion, or a hint of it, from the custom-house, from the surveyor, naval officer, or 
 from any person there? 
 
 A. No. When I first got this information I saw Mr. King and told him of 
 it. He said to me, " Mr. Oakley, this might turn out a pretty large case." 
 " Well," said I, "here are the necessary papers." He then called Mr. Odell, 
 the naval officer. Mr. Odell came ; and then they tried to make me tell them 
 where or how or from whom I got my information. I said, " Here is the in- 
 formation ; I give it to you as I got it. If it is correct you can take it and act 
 upon it. If you don't think it is, I can give you the names of persons who 
 will testify to my character." He then asked me to give him a few names so 
 that he could inquire and find if I was responsible. He sent for me in a few 
 days, and said he, "We have come to the conclusion to act upon this informa- 
 tion. I told him rather than be coming down there and getting trouble I would 
 withdraw the information. He also tried again to know whom I got the in- 
 formation from. I told him I had pledged my word and honor as a gentleman 
 not to give the name, and that under no circumstances would I do so. I said I 
 
282 
 
 NEW YORK CUSTOM-HOUSE. 
 
 would sooner withdraw the paper than to give the name or to have any further 
 trouble with it. He then said he would act on this information. Thai wai the 
 last time I went down there again until I went down and got my money. Some 
 three weeks after thirf conversation with him I went down again to Mr King to 
 know whether anything had been done in the case, and lie told me then- had 
 been. He then sent a colored man to Mr. Hanscom's office to know if I was 
 the informer in the case. Mr. Hanscom gave the man a note saying I was. 
 I then went to Mr. Ogden and got the money. 
 
 SAMUEL G. OGDEN recalled. 
 
 Q. What amount was paid in the seizure case of Stursberg & Co.? 
 WITNESS, after referring to a ledger which he had, stated: The amount 
 received in that case was $62,439 53. 
 Q. How was that amount distributed ? 
 
 A. Half to the United States, one-fourth to the informer, and one-fourth is 
 divided between the collector, naval officer, and surveyor. 
 Q. How was that paid ? 
 
 A. By a check of the clerk of the court on a State bank. 
 Q. Are you iu possession of the views of the late Collector Preston King 
 relative to that case, and the disposition made of his share as collector? 
 A. I am not in possession of his views. 
 
 Q. Do you know whether he received or demurred to receive his share ? 
 A. He demurred against receiving it when I offered it to him. He said, 
 " Keep it for a few days." 
 
 Q. What reason did he give you for not taking it then ? 
 A. He gave me no reason. 
 
 Q. Have you any knowledge of what the reason was ? 
 
 A. There seemed to be some hesitation on his part to receive it ; and I ac- 
 tually kept the money for him until after his death, and then paid it to his 
 administrators. 
 
 Q. How far back do the books you hold in your hand go ? 
 A. To September 22, 1SG4. 
 Q. What is that book ? 
 
 A. A memorandum of the seizures received and distributed. 
 Q. Have you a memorandum in it of the amount paid by Loeschick, Wesen- 
 douck cSc Co J 
 
 A. Yes. The amount paid in that case was $16,452 55. 
 Q. That was the full amount paid ? 
 A. Yes. 
 
 Q. Who paid it ? 
 A. The clerk of the court. 
 Q. Did he pay it by a check ? 
 A. Yes. 
 
 Q. Was there any paid previous or after that by that house ? 
 A. I cannot say. 
 
 Q. If there was such payment made, or such settlement by compromise, 
 would it appear in that book 1 
 A. Yes. 
 
 Q. Does that book enable you to state the amount so paid to the naval officer, 
 collector, and surveyor each year ? 
 A. Yes. 
 
 Q. State to the committee the amount so received by the collector, naval 
 officer, and surveyor during the time they have held office. 
 Witness here submitted the following statement : 
 
NEW YORK CTSTOM-HOUSE. 
 
 283 
 
 Moneys paid Ah ram Wakcman, surveyor, for his proportion of fines, penalties, and forfeitures. 
 1S64. 
 
 October $4,086 92 
 
 November 3,204 69 
 
 December 725 42 
 
 1865. 
 
 January 6. 364 58 
 
 February 1,541 84 
 
 March 5,885 
 
 April 3, 867 
 
 May 2, 687 
 
 June 10,491 
 
 July 
 
 August- 
 September 
 October .. 
 November. 
 December . 
 
 2, 633 
 1,838 77 
 3,893 08 
 6,621 49 
 4,485 34 
 1,013 32 
 
 1866. 
 
 January $1 , 
 
 February I, 
 
 March'. II, 
 
 April 4, 
 
 May 6, 
 
 June 
 
 July 
 
 August 
 
 September 
 
 October 
 
 November 
 
 December 
 
 938 82 
 730 60 
 218 76 
 999 32 
 -J- 12 
 392 31 
 903 82 
 038 39 
 292 89 
 489 09 
 416 68 
 615 66 
 
 Total 101,206 14 
 
 Henry A. Smythe, collector. — Share of forfeitures received from May 16, to December 31, 1866. 
 
 May 29 
 
 June 29 
 
 July 16 
 
 July 31 
 
 Julv 31 
 
 July 31 
 
 August 20 
 
 August 20 
 
 August 20 
 
 August 20 
 
 August 20 
 
 August 31 
 
 August 31 
 
 August 31 
 
 September 13. 
 September 13. 
 September 13. 
 September 24. 
 September 27 . 
 
 October 1 
 
 October 1 
 
 October 9 
 
 October 9 
 
 October 9 
 
 83, 
 
 815 
 255 
 207 
 388 
 12 
 25 
 197 
 461 
 231 
 192 
 568 
 357 
 8 
 5 
 331 
 183 
 185 
 2 
 376 
 360 
 19 
 12 
 89 
 97 
 
 October 9.... 
 October 19. .. 
 October 31... 
 October 31... 
 October 31 . . . 
 October 31... 
 October 31... 
 November 7. . 
 November 20. 
 November 28. 
 November 28. 
 December 10. 
 December 10. 
 December 17. 
 December 26. 
 December 29. 
 December 29. 
 December 29. 
 December 29. 
 December 29. 
 
 881 00 
 358 88 
 332 98 
 46 12 
 9 88 
 9 83 
 3 34 
 310 09 
 2,810 77 
 3 60 
 260 83 
 42 07 
 245 36 
 214 28 
 2,580 30 
 9 50 
 245 12 
 86 12 
 50 09 
 2 50 
 
 16,080 89 
 
 John A. Dix, natal officer- 
 
 Share of forfeitures paid to him from October 1, to December 31, 
 1866. 
 
 October 31 46 12 
 
 October 31 9 87 
 
 November 20 2, 810 77 
 
 November 28 3 60 
 
 November 28 99 57 
 
 December 10 213 28 
 
 December 26 2, 580 30 
 
 December 29. 
 December 29 . 
 December 29. 
 December 29. 
 
 245 13 
 
 86 00 
 50 09 
 2 50 
 
 6, 148 24 
 
 Custom-House, New York, 
 
 Collector's Office, January 30, 1867. 
 Sir : In obedience to your request, dated 29th instant, I have the honor to report that the 
 aggregate sum paid to George Denison, late naval officer, as his share of fines, penalties, and 
 forfeitures during his term of office, commenciug June 1, 1861, and ending August 31, 1865, 
 was cl 14,704 27. 
 
 I am, very respectfully, 
 
 S. G. OGDEN, Auditor. 
 
 Hon. C. T. Hulburd, Chairman, 8fc. 
 
284 
 
 NEW YORK CUSTOM-HOUSE. 
 
 NEW York, January 12, 1867. 
 
 PHILIP HERZOG sworn and examined. 
 
 By the Chairman : 
 Q. Are you employed in the oustom-house ? 
 A. I am, as one of the assistant appraisers. 
 
 Q. Are yon familiar with the invoices of Hennecuin & Co. and of Stursburer 
 & Co. ? 
 
 A. Yes. 
 
 Q. What is your opinion of the correctness of their invoices? 
 
 A. Since I have been appraiser I have found them as correct as the invoices 
 of any other house, and they all are correct now. 
 
 Q. Is it not a fact that these invoices have been regarded so correct as to be 
 treated as a sort of standard to judge other persons' goods by? 
 
 A. Since I have been appraiser I have taken no person's goods as a standard, 
 as I am a very good judge myself, hut there were some eases where I did 
 take Mr. Stursburg's invoices a< a standard, because I regarded his invoices cor- 
 rect and knowing his ability to buy cheap. 
 
 THE LULING CASE. 
 
 New York, January 16, 1S6 7. 
 
 WILLIAM JOEL sworn and examined. 
 
 By the Chairman : 
 Q. Are you in business ? 
 
 A. I am a member of the firm of Luling & Co. 
 
 Q. Have you had difficulties with the custom-house ? 
 
 A. Yes. In 1S64 some friends of ours sent a number of boxes of sugar from 
 Havre in expectation of having them reach here before the increase of duty 
 would take place. In this they failed, as the vessel was delayed and arrived too 
 late. Consequently we entered the sugar in bond. The invoices stated very 
 emphatically at the top, on the basis of so many francs, so many boxes of sugar 
 at such and such a price. We sent these invoices to the custom-house. But we 
 knew the goods would have to be re-exported, because the object for which they 
 were sent had failed, and a better sale could be effected where they came from. 
 One Saturday afternoon a gentleman came to the office and asked to see me. I 
 said that I was the person he inquired for. He said, " This is a private business; 
 you imported some sugars ?" I said, " Yes." "Well," said he, "there is some 
 trouble about these sugars." As I did not think there could be any trouble 
 ( about them I said nothiug, but that I was exceedingly obliged to him, and that 
 I would go and see about them on Monday morning. On that morning I went 
 to see Mr. Luling, who was interested in the sugars, and told him what had been 
 said to me. He said it was one of those black-mailing arrangements. We then 
 went down to see Mr. Barney. He was going out and he said, " Gentlemen, take 
 a seat," and we did so, and waited from twelve o'clock until half past three, 
 and he did not come back. I then went to Mr. Van Hauffman and asked 
 him what counsel he employed, and I told him my case. He said Webster & 
 Craig were generally employed in that kind of business. We employed them 
 and they went to Mr. Barney, but could not find out for some days what was 
 the matter. Finally they found out that they were seized on the ground of the 
 invoice having been abused. We then asked to see the invoice, but could not 
 see it, but at last we saw it, and found there was a big ink-spot on the invoice, 
 so that it obliterated part of it. The case then went into court, and Mr. Daniel 
 
NEW YORK CUSTOM-HOUSE. 
 
 285 
 
 E. Dickinson made a very fine speech and some severe remarks as to our faults* 
 He took up his books to leave, as he said if the jury did not give a verdict for 
 the government it would not be decided until next morning ; but before he left 
 the court the jury came back and gave a verdict on all points in our favor. 
 Then the government, through the district attorney, applied for a certificate of 
 probable cause, but the judge refused, after argument, and said there was not 
 the slightest cause for seizing these goods. We then brought a suit against Mr. 
 Barney for damages, and the thing went on for quite a length of time, and finally 
 Mr. Barney sent his attorney to our attorneys — Webster & Craig — to find out 
 what we would be satisfied with. We wrote to Mr. Luling, and he named 
 $10,000 ; and the first thing we heard after that was that we got a check for 
 that amount, and also with the lawyers. Where this money came from is more 
 than I can say, but we got it. 
 
 MISCELLANEOUS SEIZURES. 
 
 New York, January 10, 1867. 
 DUNCAN McDOUGAL sworn and examined. 
 
 By the Chairman : 
 Q. What is your business? 
 
 A. I am a member of the firm of Hennecuin & Co. 
 Q. What goods do you deal in ? 
 
 A. We are "importers here of worsted goods, shawls, muslin-de-laines, and 
 fancy dress goods, made of silk and worsted. 
 
 Q. Were any of your goods seized by the custom-house % 
 
 A. Yes ; our stock, books, and papers were seized last May, during my ab- 
 sence in Europe. I think it occurred about the 10th or 12th of May ; and I 
 knew nothing except by correspondence until I returned in July. 
 
 Q. State briefly, as you understand it, what led to the seizures, and the cir- 
 cumstances attending the seizures themselves. 
 
 A. I don't know what the circumstances were that led to the seizures, but 
 the matter as reported was this : about the date I have given you a number of 
 custom-house officers came into our office and took possession of our books, pa- 
 pers, and stock generally. My junior partner, who was here at the time, imme- 
 diately consulted a lawyer, who went to see the necessary authorities on the 
 subject. " The matter was discussed for a couple of weeks, when we settled by 
 compromise. The charge made by them was that our goods had been system- 
 atically undervalued for a certain length of time. The matter was finally dis- 
 posed of by a revaluation of the goods from a certain time, since which they 
 said they had been undervalued, and a certain amount was paid into court. 
 
 Q. What was the amount paid into court % 
 
 A. Independent of our counsel's fees I think the amount paid for the benefit 
 of the custom-house was either $47,000 or $47,500. 
 
 Q. How far back did these transactions reach on which they claimed there 
 had been undervaluation ? 
 
 A. I think they claimed there had been undervaluation for an indefinite 
 period of time. But I think the revaluation took place from the 1st of Janu- 
 ary, 1865, to May, 1866. 
 
 Q. This sum you say was paid into court % 
 
 A. Yes ; it was paid into the United States court. 
 
 Q. How was the sum paid arrived at as being the proper sum to pay % 
 
 A. From conversations 1 had with my lawyer after my return it was arrived 
 
286 
 
 m:\v YOiiK crsTOM-iioi'si:. 
 
 at by taking their valuation as compared with our invoices, and making up the 
 differences: And I also learned from him that, in order to make up tbU -um 
 which they claimed, certain invoices were declared confiscated. Of course they 
 were not confiscated except in form, hecause they had not posse.' i m of them, 
 as they had been sold and disposed <»t*. J do not even know w hat invoices they 
 were. But I learned that was the way this amount was arrived at. Certain 
 invoices were declared confiscated, and the value of them accepted instead of 
 the goods. 
 
 Q. Then the goods proper were never seized '. 
 
 A. No, except the general st<»ck, no special goods were ever seized. In 
 March or April, before 1 h t't for Europe, we had some little ditliculty or discus- 
 sion with the appraisers. It was in respect t > one invoice of goods. There 
 were several cases in bond at the same time that had not been examined, and 
 being goods of the same class they were all stopped, and we were required to 
 send them for examination; certain goods, however, having been received by us 
 though they had not been examined, we had disposed of them in full faith of 
 their being all right But they had in the other cases goods of the same class 
 Bufficienl to represent almost every pattern and quality ; and having invoices 
 also they could settle then on the same basis. They raised our invoices some 
 15 or 20 per cent. I called for a rcappraisement, and certain merchants were 
 called in as appraisers, and the matter was discussed among them, and they 
 finally arrived at certain prices. They made various differences, from, I think, 
 9 or 10 per cent, up to 14 or 15 per cent., on the whole of them. 
 
 Q. "Was that the last of the difficulties you had with the custom-house ? 
 
 A. Yes. 
 
 Q. How did this discrepancy in the valuation arise ? 
 
 A. It arose from the fact that our house abroad is a manufacturing house, 
 and at the time we did not sell any goods in Europe. The goods were manu- 
 factured for this market, and we sold no goods except through our house in 
 New York. Our house there consequently always invoiced their goods with a 
 simple advance, sufficient, as they supposed, to constitute what was considered 
 market value. These gentlemen, however, did not consider that enough. In 
 the case of shawls, they were cashmere shawls — there was a considerable por- 
 tion of them both in the first and last seizures. These goods are very difficult 
 to manufacture, and the expense of the designs is very great. The consequence 
 is that any party who is able to make four or five times as many as auother on 
 the same designs so reduces the cost price to him as to make a very miterial 
 difference, sufficient in itself to constitute a good profit. We were making these 
 goods to a larger extent than almost any other house in France. We were the 
 only manufacturing house sending them direct here, and the gentlemen who 
 were called in to examine them were parties who went into the market at the 
 other side to buy them, and of course they paid a profit to the seller of them 
 there. They did not even buy them in a wholesale manner. Even Mr. A. T. 
 Stewart don't do so. These goods are bought tliree or four of one pattern and 
 three or four of another, which make up in the end a large invoice. But we 
 make these goods by the hundred, and of course they cost us less than even a 
 manufacturer who only makes half the quantity, and the difference must be 
 even greater between us and a man who only buys half a dozen. 
 
 Q. Do the committee understand you to say that the variations in the invoice 
 really do cover the cost of manufacture and a percentage added to cover every- 
 thing ? 
 
 A. Distinctly^, sir. 
 
 Q. And that although your goods were seized and you paid money, it was 
 still a bona fide transaction within the meaning of the law ? 
 
 A. Within the meaning of the law is very difficult for us to say what that is. 
 The gentlemen acting as appraisers claimed that the prices at which other peo- 
 
NEW YORK CUSTOM-HOUSE. 
 
 287 
 
 pie bought the goods in the market was the market price, and on that they 
 ruled. I explained the matter to several gentlemen, who understood it per- 
 fectly well ; but still they did not think that was a reason why we should be 
 permitted to enter them lower than the market prices. 
 Q. How do you enter such goods now? 
 
 A. On the basis on which these gentlemen appraised them, at an advance 
 sufficiently large on our cost prices to cover the so-called market price. As an 
 illustration, I will state one case. Among these goods were some we bought in 
 the market; and those same goods, in different cases, were appraised at from 
 fifteen to twenty-five per cent, difference, showing a considerable discrepancy in 
 their valuation of the very same goods. These goods cost, I think, thirty-two 
 francs, and they were valued by these gentlemen at thirty-seven and a half, and 
 in some cases at forty francs. We submitted to this without any discussion 
 because they were only a small portion of the whole. During my visit abroad, 
 last July, I bought the same goods fifteen per cent, below the original price of 
 thirty-two francs, although they raised them to thirty-seven and a half and to 
 forty francs. I did not dare to send these goods out here at the prices we 
 bought them at, but invoiced them at thirty- five francs, or thereabouts. Think- 
 ing that a sufficient advance on them, we sent them out here and paid duty on 
 fifteen to twenty per cent, advance more than what they cost us, and still they 
 were fifteen to twenty per cent, lower than the prices these gentlemen put on 
 them. Xow, it is difficult to say what is the market price. We are not suffi- 
 ciently in the market to know what the market price is, because we are manu- 
 facturers, and manufacture exclusively for this market; but yet, as we are only 
 occasionally in the market, we cannot say what the market value is. I wish to 
 mention another matter against which I protested at the time, verbally. It was, 
 that in the reappraisement of our goods they called on parties who were our 
 customers, or the salesmen of our customers who, although they knew how much 
 they could get them for, had but a very slight knowledge of their value abroad. 
 When they are sent abroad they are sent to select certain styles and classes of 
 goods, but under the supervision of people who know the value of them. Mr. 
 ■Stewart was subpoenaed, but having no personal knowledge himself, he sent his 
 shawlman — his retail shawlman — who knew nothing of the value of these goods 
 in Paris. I think it is proper that instead of persons like that, when a re- 
 appraisement is called for, that people who have a knowledge of the value of the 
 goods in the market where they are bought should be the people to examine 
 them. 
 
 Xew York, January 11, 1S67. 
 HEXRY J. ARMSTRONG sworn and examined. 
 
 By the Chaikmax : 
 Q. What is your business % 
 A. I fill a situation in the post office. 
 
 Q. How long have you been connected with the post office 1 
 
 A. Nearly four years. 
 
 Q. What was your business before 1 
 
 A. I was a builder. 
 
 Q. You have given some information to the custom-house in reference to the 
 house of Hennecuin & Co. ? 
 A. Yes. 
 
 Q. How did you get the information you gave against that house ? 
 A. I got it through a dispute that occurred between two men who were sell- 
 ing diamonds ; I got an inkling of the matter first in that way, and I then went 
 
288 
 
 new york Custom-house. 
 
 to work to follow the case out; I also got information from parties Who Wi n 
 cognizant of the transaction, and I was certain there was something in tin* case, 
 and it turned OUt that there was. 
 
 Q. Who did you obtain the information from ? I understood you to say 
 from parties to the transaction. 
 
 A. I got. it from parties who were usually in and out of their place of busi- 
 ness, and who knew what was going on. 
 
 Q. To whom did you give that information ? 
 
 A. To Mr. Smythe, the collector. 
 
 Q. It was lately, then ? 
 
 A. Yes ; not more than three months ago. 
 
 Q. To whom did Mr. Smythe direct you? 
 
 A. He took the papers himself; 
 
 Q. When did yon hear from him again I 
 
 A. I went several times to a>k him what he was doing ahout it. At last I 
 saw some one of the ollicials — I cannot think who it was; it might have heen 
 Mr. Franklin or .Mr. Wakeman, hut I cannot really tell who it was — and I 
 asked what the result of the case was, and I think Twas told it produced or 
 was settled for £:J0,000. 
 
 Q. Did you get one-fourth of that ? 
 
 A. I did. 1 was very much disappointed, hecause I calculated the whole 
 thing would produce $80,000. I paid liberally myself for the information I got. 
 I have also some other cases that are in abeyance for some time ; as they do not 
 seem at the custom-house to be in a hurry ahout them, I think the collector 
 and the others there believe I receive too much money. 
 
 Q. Who were you finally paid by? 
 
 A. 1 was paid in Mr. ( )gden's room, in greenbacks. 
 
 Q. If you wgre paid there, you must undoubtedly have been paid the amount 
 due you according to the distribution of the proceeds \ 
 
 A. I was paid $7,700 and some odd dollars ; I think it was $7,740 I got. 
 
 Nkw York, January 14, 1867. 
 HY. J. ARMSTRONG recalled and examined. 
 
 By the Chairman : 
 Q. Where did you write the letter which you sent to the collector giving the 
 information in the case of Heunecuin & Co. ? 
 A. I wrote it at my house. 
 Q. At whose suggestion ? 
 
 A. From the information I derived from those parties I mentioned in my 
 former evidence. 
 
 Q. Did any person prepare that letter for you ? 
 A. No. 
 
 Q. Was the information in the case given to you by any officer of the custom- 
 house ? 
 A. No. 
 
 Q. Did you pay any portion of your share as informer to any officer of the 
 custom-house 1 
 A. No. 
 
 Q. Were you acquainted with Mr. Hanscom, deputy collector, before this 
 case occurred ? 
 
 A. I was acquainted with him, by taking him two or three cases before that 
 time. I had a few similar cases, which I took to him ; but he did no't use them. 
 
NEW YORK CUSTOM-HOUSE. 
 
 289 
 
 One of them missed, and I spoke about it. I thought he acted very reserved 
 about the matter. 
 
 Q. Was there any person — clerk, or any other official — connected with the 
 custom-house, with whom you divided your share of the seizure ? 
 
 A. No. These other cases, Hanscom thought there could be nothing done 
 about them, while I thought there could be — he is a very strict officer. There- 
 fore, when this case came out I determined to take it to the collector. 
 
 New York, January 10, 1867. 
 R. OSCAR STRESBURGER sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business in this city % 
 A. I am. 
 
 Q. What is the name of your firm ? 
 
 A. Stresburger, Nuhn & Co. 
 
 Q. How long have you been in this business ? 
 
 A. Since 1S63. 
 
 Q. What do you import ? 
 
 A. We import fancy goods. 
 
 Q- Had you any trouble with the custom-house officers in the matter of seiz- 
 ures ? 
 A. Yes. 
 
 Q. State the particulars. 
 
 A. One day in March, I860, one of the custom-house brokers, named Isaacs, 
 met me, and told me he had something to tell me — a great secret. I did not 
 stop right away, and he said " You had better stop, as what I have to tell you is 
 very important for you." He then told me there would be a visit from the 
 custom-house officers at our store the next day; and he said if we had anything 
 wrong to put out of the way that we might do so, and that we had better settle 
 the matter. I told him we had nothing to settle, and that there was nothing 
 wrong. The next day the custom house officers came and took possession of 
 our store and books and private papers. They searched the desk and took 
 whatev°r they wanted, and brought them to the custom-house, and left an officer 
 in possession of our premises. One of the deputies told me we had better get a 
 lawyer and settle the matter, and I answered him I had no need of a lawyer, 
 because I could settle my own affairs better than any lawyer. I went to the 
 custom-house and asked to see the naval officer, Mr. Odell, as I knew him per- 
 sonally for a long time. I told him all about this matter, and that we wished 
 to get the matter investigated as quickly as possible ; that there was a great 
 deal of harm done to our business, as our books had been taken away and pos- 
 session kept of our premises. He promised me the matter should be speedily 
 investigated, and he said there was information from parties, but he could not 
 give the names. 
 
 Q. How long did they keep possession 1 
 
 A. Twenty-four hours. 
 
 Q. Did they give any reason then for giving them up ? 
 
 A. They said they found them all correct, and that in some instances we 
 paid more than we ought to have paid. 
 
 Q. Did they offer to pay you back anything 1 
 A. No. 
 
 Q. Who was the officer in charge of the party who made the seizure ? t 
 A. Colonel Van Brunt. They excused themselves, and said it was on in- 
 formation of an inspector of customs, named Bostwick. 
 H. Rep. Com. 30 19 
 
290 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Have you been acquainted with Isaacs any length of time '. 
 A. I have a great deal of business in tin- custom-house, and lie is a broker 
 there, and he has wanted my custom, but I would not give it to him. 
 Q. Did he tell you how he knew the store was to be seized ? 
 A. lie did not. 
 Q. ( 'ontinuc your statement . 
 
 A. About seven or eight weeks ago a man came to me, in our store, and said 
 he, Wanted to see me on private business. He said we would have a visit from 
 the customhouse officers next day; but that, if I would pay $500, the visit could 
 be prevented. I said we had nothing to fear from a vi>it, and that they might 
 come at any time, and thai he might (dear out of the store. He went away, 
 and the next day we had a visit, but they found all correct, and they investi- 
 gated our books and excused themselves. 
 
 Q. Who was the man that came to you in this way? 
 
 A. I don't know him personally; but from inquiries that I made, I learned 
 he was connected with tie- custom-house. I think his name- eras Newstetter. I 
 made this matter known to some of my friends and it appeared in the newspa- 
 pers. One day I was sent tor from the custom-house in the name of Deputy 
 Collector Clinch. J went there and found the naval officer and surveyor also 
 there. They received me with great reproaches because 1 had made the matter 
 public. Mr. Wakeman, .Mr. Hanscom, and Mr. Franklin were there. I took 
 Judge Birdsey, a friend of mine, along with me and introduced him to them; 
 and though at first they thought toMVignten me, they saw it was no use, and I 
 told them if they had given me the names of these fictitious and malicious in- 
 formers I would not have made the matter public. 
 
 Q. What did they say to that? 
 
 A. That there was a law made by Congress that these informers should not 
 be made public. I said that where the information was false and malicious 
 there was no protection for the honest merchant; and that I knew Congress did 
 not mean that, They then said the information was received at the seizure 
 bureau by Mr. Bostwick ; and that if they were rightly informed, one of our 
 former clerks, named Samwald, or Garlichs, had given some important informa- 
 tion, and that it was indorsed by a very respectable party, a Mr. Runkel, 
 who was formerly a deputy collector in the custom-house. And, of course, 
 they had to follow out this information and take proceedings against us. Mr. 
 Wakeman proposed to allow Mr. Isaacs to do no more business as a custom- 
 house broker. They sent for Mr. Isaacs, and he denied having told me any- 
 thing, but they sent for some persons who saw him speaking to me, and finally 
 he acknowledged that he told me so. He said that he saw some papers in the 
 seizure bureau with our name on them, and that he thought he could be of 
 service to us. 
 
 New York, January 10, 1S67. 
 THOMAS N. DALE sworn and examined. 
 
 By the Chairman : 
 Q. Are you in business ? 
 A. I am. 
 
 Q. What is your business ? 
 
 A. The firm of Thomas N. Dale & Co., to which I belong. 
 
 Q. Were you brought in contact with the custom-house officers in the matter 
 of duties, fines, penalties, or seizures ? 
 
 A. Yes. On my return from Europe, in July, 1864, I came into contact 
 with a young man who was formerly an appraiser in the house of Loscheck, 
 
NEW YORK CUSTOM-HOUSE. 
 
 291 
 
 Westendon & Co., who applied to me for a situation in our house In making 
 known his qualities he showed me that he had been formerly an appraiser and 
 selector of goods for that house, and acquainted with the manufacturers of the 
 same class of goods that we imported. I asked him to show me the prices he 
 paid for the goods for that house, and he showed me his memorandum-book, in 
 which were the prices of the articles he bought, and which corresponded with the 
 articles we had. On my arrival in New York I called on Mr. Dennisson and 
 laid this memorandum before him. We looked up the invoice and examined 
 it, and found it, to correspond in quantities, description, &c, and in everything 
 except the price, and the price was from twenty to thirty per cent less. Mr. Den- 
 nisson was anxious to have the matter investigated, and wanted the young man to 
 make an affidavit of the purchases. I sent for the young man, and wanted him to 
 understand I had taken hold of it, and wanted the matter prosecuted in a per- 
 fectly legal manner. He called me aside and said he did not want to sign the affi- 
 davit, as he said the custom-house officials would avail themselves of his informa- 
 tion and compromise the case, and give him nothing but the odium of being an 
 informer. 1 tried to induce him to sign it, but he said he would not trust them 
 without a guarantee of my word. I then asked Mr Dennisson to look in the 
 custom-house and try and find some cases there. He did so, and in the course 
 of a few days an invoice was found and seized for undervaluation The value 
 of that case was 90,000 francs. Shortly after this, Mr. Draper succeeded to 
 the collectorsliip, and I called on him in regard to the matter, and urged him to 
 take some notice of it. He said he would if I would bring the young man 
 down. I did bring him down, and he made the same objections he did before, 
 that he had no confidence in the custom-house officers, for they would cheat 
 him out of the inf >rmer's rights, and therefore he would not sign the document 
 without security that he would have his rights. I then proposed to Mr. Draper 
 that as the informer's portion of the case that was seized belonged to me, it, should 
 be given to him. Mr. Draper said that could not be done, but that 1 could make 
 some arrangement with him. I then asked Marsh (that was the young man's 
 name) what he wanted, and he said if I secured him 85,000 he would sign the 
 information. I gave him a check then for $5,000, and the case was taken up, 
 but was afterwards compromised for S 16,000 in currency, gold being then at 240. 
 Q. What was the amount claimed ? 
 
 A. 90,000 francs, which would be worth in federal currency something 
 between $30,000 and $40,000, but of that I got about $4,400. I afterwards 
 learned they were going to compromise the whole thing instead of proceeding 
 against the house, and not go on with the other cases. I complained to Mr. 
 Draper, but he said he had nothing to do with it. Mr. Dennisson and Mr. Hans- 
 com were very much infuriated with me for interfering with their compromise. 
 I will here read a letter which I wrote in consequence of seeing a paragraph in 
 the "Evening Post," complimentary to Mr. Draper for his diligence. This 
 letter I wrote to Mr. Sargent, Commissioner of Customs, Washington : 
 
 March 8, 1S65. 
 
 Dear Sir : Without the desire to detract from that respect due to the officers of the cus- 
 tom-house, it seems to me the mountain must have had a severe labor when it brought to 
 the notice of the public the great frauds committed by the ladies on our customs revenue, as 
 indicated by your letter to our collector, under date of the 27th ultimo; and your urgent 
 request that the subordinates should thrust their official hands deeper into those large trunks 
 that no extra apparel may escape paying the national tax, would seem to indicate a great 
 source of fraud on the public revenue, which had at last attracted the official eye. Indeed, sir, if 
 you were seriously in earnest and anxious to protect the public revenue, you can, with credit 
 to yourself aud advantage to the government, direct your attention to higher subordinates 
 than those who examine ladies' trunks. So long as perjured and smuggling merchants can 
 compromise their frauds in a quiet corner of the naval office for half or quarter the amount 
 of their frauds, when the sums are thousands, there is little use for this extra diligence over 
 travellers' trunks to detect a few dollars. 
 
202 
 
 NEW YORK CUSTOM-HOUSE. 
 
 To my own knowledge a seized invoice of poods, amounting to over s:W,(»(»0, was surren- 
 dered to the owner lor some S|(),IK)I». And when evidence was placed in the hands ©f the 
 
 naval officer by the writer of a transaction of a much Larger amount, t.. recover which 
 hooks should have heen seized and other legal steps taken, not only to recover the amount 
 Of the hand hot to punish I lie delinquent, instead of taking these steps, hfl wai mb( lor to 
 compromise, in this centre ot'motal degradation and official corruption. Kighl monthf have 
 elapsed and the case is not adjusted, and this importer still maintains his social and mercan- 
 tile position among the honest merchant! of New York, to expose which would kill the 
 goose that lays the golden eggs for our high suboi dinates in the custom-house. 
 
 So long as the government and the powers that he feel it to their interest to keep such men 
 in office as now represent the head of the naval ofhee, it can atford, and without much far- 
 ther sacrifice, to allow the very large trunks of the ladies pass with the oidinarv examina- 
 tion. 
 
 The case of fraud ahovo referred to is only one of hundreds annually compromised. 
 The writer is known to Charles O'Connor and ex-Governor Morgan. 
 N. 8aU<;f.NT, Ks<p, Commission! r of Customs, W ashington. 
 
 At, the same time that these frauds were reported, I was appointed govern- 
 ment appraiser on 800 baskets of champagne. Being insulted in the custom- 
 house, and finding no redress from the department, 1 concluded to resign, ami 
 wrote to Mr. Draper my resignation as appraiser, which he stated he could not 
 accept. 1 then appealed to the Secretary of the Treasury to he released from 
 serving as a public appraiser, and stated that I considered it no part of an hon- 
 est man's dmy to sit in judgment on the frauds of merchants when the penalties 
 
 of these frauds were paiticipated in by the greater delinquents — the custom- 
 house officers. The Secretary wished rne to go on and finish the appraisal I 
 declined to do so; maintaining that if he could not correct a fraud committed 
 on me by the retention of money which I had advanced in good faith, I could 
 not perform the duties 1 had to perform towards the government : and after I 
 had seen by the books that these invoices, which had been sworn to hv these 
 informer?, amounting to 817,000 or $18,000, had been compromised for *17,000 
 in currency, 1 then wrote to Mr. Draper soliciting the return of the balance 
 •due me out of this money, lie declined, and said there was nothing due to me. 
 I called again at the custom-house, when Mr. King was collector, and said I 
 would like to examine the custom-house books in order to answer a letter I had 
 received from the Solicitor of the Treasury, who had received complaints from 
 some merchants in regard to an informer's rights, and I could not answer that 
 letter without having access to the books. .Mr. King called Mr. llanscom ; 
 but as they were busy at the time, Mr. King requested me to call next day. 
 I called the next day, and Mr. King took me into Mr. Hanscom's office and told 
 him to show me the books, and answer such questions as I should ask. It was 
 then 1 learned by the books that these cases before mentioned had been com- 
 promised for the sum of $17,000. I forgot to say that in the early part of 
 August I called on Mr. Draper and explained to him that there w as a balance 
 due me of Sf>43 43, and since he and his colleagues had realized something from 
 this information, I thought they should pay me that balance. He said he 
 would do so himself if the rest would pay their shares, and eaid he would send it 
 up to me. Hearing from him that the others refused to pay, I wrote him ou 
 August 23, 1865 : 
 
 Dear Sill : Since you informed me this morning that Mr. Dennison and Wake man refused 
 to pay their proportion of the $543 remaining due me of the loan of $5,000 made to Mr. 
 Marsh, I have no objection to accept your portion, 81/7 47: and if these gentlemen can 
 afford to persist in this course, I certainly can afford to adopt the lesson they have taught 
 me. 
 
 This transaction growing out of a want of confidence Mr. Marsh had in the officers of the 
 custom-house, he declined to sign the documents as informer before his rights were secured 
 to him, as he said he had been cheated before and would not trust them. I am glad to say 
 your frank proposition to pay your portion makes you an exception to the charge. I regret 
 that Mr. Dennisson or Mr. Wakeman should in any way confirm Mr. Marsh's suspicions. 
 In regard to these, further comments are unnecessary. 
 
 Mr. Simeon Draper, Collector. 
 
NEW YORK CUSTOM-HOUSE. 
 
 293 
 
 Notwithstanding Mr. Draper's promise, I never received the money. Mr. 
 Edwards called on me some time since and sai l that the champagne cases were 
 very important cases, and he offered to give me his word that the money would 
 be paid to me. I told him I would accept nothing until I had first received the 
 money due me ; and that if the government could not manage its own officers, 
 it had no right to call on me to assist them in detecting frauds on others. They 
 have never been able to make anything of this champagne case, in consequence 
 of the public appraisement not having been carried out. 
 
 New York, January 14, 1867, 
 GEORGE SAVORY sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business 1 
 A. Yes. 
 
 Q. What do you import ? 
 A. Hides. 
 
 Q. You had some difficulties with the custom-house ? 
 A. Yes. 
 
 Q. You had your books, papers, &c, seized by the custom-house ? 
 A. Yes. 
 
 Q. State the circumstances and when and why they were seized. 
 
 A. It is some three years ago, and was because, they alleged, we put a wrong 
 valuation on -them. That occurred out of converting the paper currency of 
 Buenos Ayres into Spanish coin. 
 
 Q. Were there not several seizures made 1 
 
 A. Yes. 
 
 Q. How did you get back your books after they were seized ? 
 
 A. By Mr. Jordan making an arrangement with Mr. Evarts, our counsel, 
 that Ave should withdraw the suit we had entered against the government ; and 
 since then we have entered ihem without any trouble. 
 
 Q As you did before ? 
 
 A. No. Now they value the paper dollar at so many to the doubloon in- 
 stead oi to the Spanish dollar. 
 
 Q. What was the object of making those seizures ? 
 
 A. My opinion is, the object in seizing our books was in the expectation of 
 extorting money from Buenos Ayrien merchants, thinking they would sooner 
 pay some than go to law. But we would not hear of such a thing. I was ap- 
 proached to know what I would do, and I said I would not hear it. 
 
 Q. Was it from the custom-house you were approached in that manner 1 
 A. It might have been by a clerk in the custom-house, but I don't knoAV 
 with certainty whether he was a clerk in the custom-house or not. He said we 
 could get our books, &c, by proceeding in a proper way. I refused to listen 
 to him. 
 
 Q. Had you any recent difficulties with the custom-house ? 
 
 A. Yes ; we had some hides coming to us, and my partner sent one case of 
 brandy and one of wine for my own use, as a present, but invoiced at the cost 
 of it at Buenos Ayres. My broker took the invoice and bill of lading to enter 
 it, when they seized it and said we could not import brandy in less quantities 
 than fifteen gallons. I was not aware of any such law, because it was passed 
 last July and went into operation in October. I immediately went to the 
 custom-house and sent in my card to Mr. Smythe, as I knew him personally. 
 He received me very cordially before he knew my business ; but the instant I 
 
294 
 
 NKW VOKK CUSTOM-HOUSE. 
 
 stated my business, and that I did not know such a law, ho coolly pat down 
 and said to his messenger, M Show Mr. Savory to Mr. Embrcc ;" and he waved 
 
 me out. My broker wrote to the Secretary, stating tin- facta and asking Leave 
 
 to pay the duty, and the matter dropped. Now, wo paid $10,000 duty in gold 
 this year, and yet this is how we art- treated when we ask for redress. 1 stated 
 
 at the last meeting of the committee that I bad given orders to Mr. Washington 
 
 to put in y goods above the market price, so that they could not be seized. 
 Since then I have often received little slips of paper Stating that * s or S10 
 were due because the entries had been too high. 
 
 Nkw York, January 16, 1867. 
 GEORGE E. SPARROW sworn and examined. 
 
 By the Chairman ; 
 Q. Are you in the importing business \ 
 A. res. 
 
 Q. What kind of goods do you import I 
 A. Listing, bindings, \c\ 
 
 (,). Do you purchase abroad or receive on consignment? 
 
 A. "What 1 receive from abroad 1 receive on consignment. 
 
 Q. On your consignments had you any difficulties with the custom-house? 
 
 A. One invoice was seized for being invoiced too low. 
 
 ( v >. State the circumstances briefly. 
 
 A. A vessel arrived with these goods early in February, but the goods were 
 detained until April 25. I called several times to have theui examined. 
 Q- Did you offer to enter them I 
 A. In fact they were entered. 
 Q. Did you offer to pay duties ? 
 
 A. I did; but the public-store goods had not been examined. I sent down 
 my broker to know the reason why they had not been examined. He said he 
 did not know the reason ; but he told me to send down $25 or S30 to the ex- 
 aminer; that he might have been waiting for that. I said I would not. Finally 
 I was notified the goods had been appraised. I called for a reappraisement, 
 and then they were raised still higher, and seized, and I had to pay 81,556 88 
 to get them out. 
 
 Q. What was the amount of the goods seized ? 
 
 A. I have not got the amouut with me. 
 
 Q. What was the reason given for their seizure ? 
 
 A. It was claimed they were invoiced too low. I told them they were not, 
 and that I would bring a letter from the party that sent the goods, and one 
 from the manufacturer; and I also explained that they were a low quality of 
 goods, to the examiner, and that I would call on parties in the city who bought 
 these goods, and that they could tell him they were worth within five cents a 
 yard of what he was putting on them. 
 
 Q. What was the full amount they claimed from you? 
 
 A. $1,556 88 was the full amount they claimed, and which I paid. 
 
 New York, January 14, 1867. 
 
 A. HEIDSICK sworn and examined. 
 
 By the Chairman : 
 Q. What is your position ? 
 
 A. I am a buyer for the firm of Shack & Hotop — a button and trimming house. 
 
NEW YORK CUSTOM-HOUSE. 
 
 295 
 
 Q. Do you go abroad to buy for this firm 1 
 A. I do. 
 
 Q. Do you kuow anything of any difficulties your firm had with the custom- 
 house here ? 
 
 A. I don't know anything about custom-house matters except in one particu- 
 lar case, when they seized our books in July, 1865. I had just returned from 
 Europe at the time, and the two partners were still absent there, when the cus- 
 tom-house officers came and seized our books. They allowed us to deliver goods, 
 but left an officer in the store. I went down to Mr. Draper, who was then col- 
 lector, to inquire what the matter was, and he would not tell me anything. I 
 then supposed some of our competitors intended to do us some damage. I then 
 requested the collector to examine the books as quickly as possible, and that he 
 promised to do ; and in about eight days after we got them back, although the 
 examining officers tried very hard to find something against us. They did, how- 
 ever, find something, but it was done by mistake, and we had to pay $160. 
 
 Q. What was it they found the mistake in ? 
 
 A, It was in invoices made out in Austrian paper currency. We make out the 
 invoice in paper money, and at the bottom of it the premium is deducted, thus 
 making out the invoice in specie. It was in the invoices made out in that way 
 that they found the mistakes in five years to amount to $160. 
 
 Q. When you paid that, your books and papers were released ? 
 
 A. Yes ; but I think it was because I applied directly to the collector. They 
 thought we bought them too cheap, but I explained that it was just before the 
 Danish war, and the market was unsettled, and for that reason we bought them 
 cheap. 
 
 New I^ork, January 14, 1867. 
 
 F. MEXSINGr sworn and examined. 
 
 By the Chairman : 
 Q. What is your business 1 
 
 A. I am a member of the firm of Passavant & Co. 
 
 Q. Are you importers ; and if so, state what kind of merchandise do you 
 import ? 
 
 A. We import silks and ribbons 
 
 Q. Do you purchase them, or are they consigned to you ? 
 A. They are consigned to us. 
 
 Q. Had you any difficulties with the custom-house ? 
 
 A. We had our books taken away. One morning in July or August last five 
 or six men came to our place and took them away, and what letters and papers 
 were in the office. 
 
 Q. Did you know they were going to be taken away 1 
 
 A. Xo. We sent for our lawyers — Martin & Smith — and Mr. Martin came. 
 We told him the case, and he said they had a right to take the books, but not 
 the private papers or the letters. He went to try and get them back, and he 
 did get us our letters and papers. On the Saturday following he again went to 
 see about the books, and he returned and told us that we would get them back 
 on the following Monday, as they had found everything perfectly correct ; and 
 on Monday morning we did get the books back, and that was the end of it. 
 They did not seize any goods. 
 
 Q. Had you to pay anything 1 
 
 A. Xo. We did not know on what grounds our papers were seized. Mr. 
 Martin could not find it out. 
 
29G 
 
 NEW YORK CUSTOM-HOUSE 
 
 New York, Friday, October 12, 18GG. 
 ALEXANDER ROUX sworn and examined. 
 
 By the Chairman : 
 Q. What is your residence and occupation? 
 
 A. I reside in New York, and carry on the cabinet-making business. 
 Q. Do you import goods extensively? 
 
 A. I have not been much in the importing business, except in regard to 
 furnishing goods. 
 
 Q. Have you had any difficulties with the New York custom-house? 
 A. I have had difficulties with it while Mr. Barney was collector. 
 Q. What was the difficulty f 
 
 A. I had an invoice of veneers and inlaid woods, invoiced in Paris at 2,200 
 francs for the custom-house, and invoiced to me at 2,800 francs. My book- 
 keeper went to the custom-house, and became an informer. For three or four 
 years I have not imported more than $2,000 or S3, 000 a year. My goods 
 and books were seized by the custom-house officers. Mr. Logan, my lawyer, 
 told me that he was not "in the ring," and that I had better see Messrs. Web- 
 ster & Craig. I did so, and g'ue them a check for >"Jo0 as a retaining fee. In 
 a few days afterwards they told me that the matter could be settled for $12,000. 
 in the course of a couple of days I paid them $1 1.000. which covered their 
 fees. Mr. Craig gave me a receipt for $7,500, and said that the balance between 
 that and 812,000 was for officers in the custom-house, or something to that 
 effect. This settlement was made in April, 186.0. The checks were made to 
 the order of Webster & Craig. I did not, myself, see any persons connected 
 with the custom-house. 1 have the receipt in my possession, and will produce 
 it to the committee. 
 
 New York, January 16, 1867. 
 SAMUEL BRUNNER sworn and examined. 
 
 By the Chairman : 
 Q. Are you connected wi h a mercantile house here ? 
 A. I am. 
 
 Q. What goods do you deal in 1 
 A. Tn dry goods. 
 
 Q. Do you purchase, or receive on consignment? 
 A. We do both. 
 
 Q. Had you any difficulties with your entries ? 
 A. Only once. 
 
 Q. State when that was, and what it was. 
 
 A. In May, 1S65. The custom-house officers came and took my books and 
 papers, left an officer in the store, and altogether stopped my business. 
 
 Q. Did they then make a claim on you for any amount ? 
 
 A I believe they did for 5100,000. I went first to Webster & Craig; but 
 I did not feel altogether confident in them; so I went to Charles O'Conor. 
 Mr. O'Conor, after I had explained the matter to him, told me I had not done the 
 least wrong; that he was willing to fight my case, but that he could not prevent 
 them from keeping my books. I then went to Webster & Craig, and they told 
 me it would be a matter of time and money; that is, if my business did not 
 suffer from the delay. So through them I settled, in order to go to my business. 
 
 Q. How much did you pay ? 
 
 A. Forty thousand dollars. 
 
 Q. Which did you employ, Webster & Craig first, or Mr. Dittenhoeffer ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 297 
 
 A. I saw Mr. Dittenhoeffer, and asked him if they had a right to take my 
 books. He said they had. I then went to Webster & Craig ; but Mr. Dit- 
 tenhoeffer saw another gentleman without my knowledge. The matter was 
 settled through Webster & Craig. 
 
 Q. How came you to go to Webster & Craig 1 
 
 A. I did not know anything of them ; but a man who attends to custom- 
 house business told me they were .the men who knew most about these mat- 
 ters. The time the seizure occurred was the busiest time of the year with me, 
 when every day lost was 81,000 lost. If it occurred now I would not pay 
 them so much money as I did. 
 
 Q. What did they seize your goods for 1 
 
 A. They said it was for undervaluation ; but they did not tell me what time 
 it occurred, or what it was. 
 
 Q. Were you told that Hauscome and Dennison said they discovered frauds 
 to a very large amount 1 
 
 A. They might have said so. 
 
 Q. Was that word sent to you ? 
 
 A. No. 
 
 Q. What amount did Webster & Craig tell you they claimed ? 
 
 A. They said they claimed first S 100,000. then $70,000, and finally they 
 came down to 840,000. I afterwards saw Mr. O'Conor, and he told me that 
 I was very foolish ; that he knew my case and that I should not have paid the 
 money. But I was alone at the time — my brother being in Europe — and I 
 wanted to get on with my business. 
 
 Q. When did you pay this money ? 
 
 A. In the latter part of May, I860, my busiest time in the year. 
 
 New York, January 12, 1S67. 
 OSCAR MUSSINEN sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business here ? 
 A. Yes. 
 
 Q. Y T hat is the name of the house ? 
 A. Henry Maillard & Co. 
 Q. Are they importers ? 
 
 A. They are wholesale confectioners and import a great deal of their raw ma- 
 terial. 
 
 Q. Where do you import from 1 
 
 A. From Marseilles and from Paris. 
 
 Q. How long have you been in the business ? 
 
 A. For thirty years. 
 
 Q. Have you had difficulties in entering your goods in the custom-house ? 
 A. Only small troubles. 
 
 Q. Were your goods detained in the custom-house 1 
 
 A. No ; except in 1856, there were some trunks detained from Mr. Maillard, 
 but he got them by paying a certain sum of money. 
 Q. To whom did he pay it ? 
 A. To the collector of the port. 
 Q. Were any of your goods seized since 1 
 
 A. No ; but we had an investigation in the house in the beginning of this 
 year. Some custom-house officers — Kirk, Col. Van Brunt, and others — came up 
 and examined the books and seized them. I was absent at the time ; and they 
 had the safe opened, and searched around the place, and took the books to the 
 custom-house, and left an officer in charge of the place. 
 
298 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Did they keep your books all that tim< | 
 
 A. Yes. About fourteen days afterwards they came and searched again and 
 wanted more books The first tine they only searched (lie office and t he s;i l'c- ; 
 but the second time they searched the cellar and basement. 
 
 Q. Did they find them ? 
 
 A. No j because there was none. 
 
 Q. I>id you go to the custom house? during these fourteen days? 
 
 A. Yes; I went to see my broker on account of the matter, 
 
 Q. Did you make any other inquiry why it was done? 
 
 A. Noj I had a consultation with my lawyers. 
 
 Q. Who were your lawyers 1 
 
 A. Webster & Craig. 
 
 Q. How came you to employ them? 
 
 A. Because we had business with them eight or nine years before. 
 Q. Who advised you to employ them at thai time | 
 A. I believe they were recommended to me by my broker. 
 Q. Well, when you went to see them about this business, what did they tell 
 you ? 
 
 A. That they would see about it, and get it all right. 
 Q. Did they Bay to yon they were going to get it all right ? 
 A. No; they asked me if the books were wrong, and [said, no; and after twelve 
 or fourteen days we got our b )oks back. 
 
 Q. Did they make a claim on you for any amount ? 
 A. No. 
 
 Q. Were you to pay anything ? 
 A. No. 
 
 Q. Did you pay anything? 
 
 A. No ; except to our lawyers. 
 
 Q. How much did you pay them? 
 
 A. Three hundred dollars. 
 
 Q. What did they do for you ? 
 
 A. I don't know; I cannot tell you. The great thing with us was to get our 
 books back as quickly as possible, for it occurred just at the time we were going 
 to make our balances, and we could not pay up or collect the balances due to us. 
 
 Q. Did you ever have any suspicion who gave them the information on 
 which they came to your stores ? 
 
 A. No, sir. 
 
 Q. Did you ever learn how they came to come to your store? 
 A. I heard afterwards the information was given against us by a Jew who 
 was doing business in Broadway in this city, but I never heard his name. 
 Q. Who did he make the complaint to? 
 
 A. Probably to the custom-house ; but that I cannot tell. So far as I could 
 find out, the Jew who made the complaint against us makes it a business to 
 make denunciations of that kind. Whether the complaints are good or not, he 
 makes money by the business. 
 
 Q. That was the only unpleasant transaction you had with the custom-house 
 latelv ? 
 
 A. Yes. 
 
 New York, January 16, 1S67. 
 IGNATZ E. KELLER sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business ; and if so, in what kind of merchan- 
 dise do you deal ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 299 
 
 A. We import fancy goods. 
 
 Q. Were any of your goods seized or detained at the custom-house % 
 A. Yes, sir. 
 
 Q. What is the name of your firm ] 
 A Keller & Ling. 
 
 Q. State to the committee the circumstances attending the seizures. 
 
 A. We never had any trouble previously with the custom-house, and we have 
 been in business since 1850. But in January last, on my return to the store 
 after being down town, I found six or eight men there ; two of them were at the 
 door, and some of them at the drawers taking out the books and papers! One of 
 the men took me aside and showed me an affidavit, as he called it, of a man 
 whose name I never heard, saying that we had made fraudulent entries. He 
 said, I suppose you want this kept as privately as possible, and I answered that 
 I supposed they would find nothing wrong. He then asked me if I had alaw- 
 yer. I said I had not, and he then remarked that he could get me one. I 
 thought it strange that he should get me a lawyer. Some of my friends after- 
 wards directed me to a lawyer in Nassau street, named Kauffman. I went to 
 Mr. Kauffman, and he wanted to know what the charge was, and I told him I did 
 not know. He then went to the custom-house to inquire what it was, and he 
 found they had a list of the charges against me, all of which I could prove were 
 errors, except one. This one was the case of a man named Woolff, from Berlin, 
 who sent me a consignment of glass buttons, accompanied by two invoices, to 
 one of which he wanted to get the prices as near as possible, and the other rep- 
 resented the market or manufacturer's value. We had these buttons still in the 
 store, as the business had fallen away very much, and some goods of a similar 
 character had, been sold some time before and did not bring within fifty per cent, 
 of the value. I told my lawyer we had the goods, but he said it would be better 
 to make a settlement with the custom-house. I thought it would be better to 
 take his advice, but yet I wanted to deal with them directly. So I weut down 
 myself to the custom-house, and was told there that they would confer with my 
 lawyer. As my books were still detained, and my business at a stand, I con- 
 sented to settle the matter, and pay $126 for doing so. This I charged to the 
 manufacturer in Europe. I did not know that it was wrong to have two invoices 
 till then. 
 
 Q. Who advised you to pay $126 % 
 
 A. Mr. KaufTman, my lawyer. He was very intimate with the custom-house, 
 as I found out after; he had a great many such cases to settle. 
 
 Q. Did your lawyer give you any reason why you should pay this $126 1 
 A. He said, "The law is very plain on this matter ; you had no right to have 
 two invoices. You may have intended no wrong, but still it was an infraction 
 of the law." I told him I did not regard the second one as an invoice at all, but 
 as a memorandum of the manufacturer stating the prices he wanted to get for 
 his goods. 
 
 Astor House, N. Y., January 31, 1867. 
 AUGUST SOLELIAO, being duly sworn, testifies as follows: 
 
 By the Chairman : 
 Q. Are you in the importing business in this city ? 
 A. Yes, sir ; and have been for over twenty years. 
 Q. What kind of goods do you import? 
 A. Ribbons. 
 
 Q. Have you had your books, papers, or goods at any time seized by the cus- 
 tom-house 1 
 
300 
 
 NEW YORK CUSTOM-HOI SK. 
 
 A. Yes, sir; books and papers. 
 Q. When did this take place? 
 A. November, 1865. 
 
 Q. What was the alleged cause of the seizure ? 
 
 A. They did not allege any cause in particular. In the paper that they brought 
 uh the .alleged cause was that it was on information that we had books and papers 
 showing that the government had been defrauded. 
 
 Q. Did they take your books and papers and seize your stoic ? 
 
 A. Yes, sir. 
 
 Q. How long did they keep your books and papers ? 
 A. About four or live days. 
 
 Q. How long did they keep possession of your store? 
 
 A. About the same time. 
 
 Q. How did you get them released ? 
 
 A. After an examination I got released by paying $31,000. 
 Q. Why did you pay that ? 
 
 A. They found that all our importing business was right, but they found that 
 some consigned goods, according to the correspondence of the manufacturers 
 consigning them, seemed to be undervalued; that they were worth ten per cent, 
 more than the price the goods were invoiced at. Thev made out a case on those 
 consigned goods, on which they claimed $31,000, and in order to get rid of 
 these gentlemen we paid the .$3*1.000. 
 
 Q. Who ad\ ised you to pay this amount ? 
 
 A. Nobody advised me. 
 
 Q. You had some counsel, I supp >se ? 
 
 A. Yes, sir ; we had Messrs. Webster & Craig as counsel. Mr. Webster told 
 me that they made a case on the consignment, and that he did not think the case 
 could be made good by the custom-house against us by the courts, but he told 
 me I could see what I had to work. The stoppage of our business for a week 
 might have cost us $50,000, so to get rid of the matter 1 paid the $31,000. 
 
 Q. Did you pay it to him or to the court? 
 
 A. It was paid into court. 
 
 Astor HOUSS, N. Y., January 31, 1867. 
 WILLI AM SHAUS, being duly sworn, testifies as follows : 
 
 By the Chairman : 
 Q. Are you in the importing business in this city? 
 
 A. Yes, sir; and have been since 1S51 on my own account, and since 1S4-5 
 for another house that I was agent for. 
 Q. What kind of goods ? 
 A. Engravers' and artists' materials. 
 
 Q. Do you import on your own account or receive consignments ? 
 A. Both ways. 
 
 Q. With either kind' of importations have you had delays or difficulties with 
 the custom-house ? 
 
 A. No delay in getting the goods. 
 
 Q. Had your books, papers or goods at any time been seized ? 
 
 A. Yes, sir, in 1865. 
 
 Q. State the circumstances very briefly. 
 
 A. I was in Europe at the time. During my absence, one of my clerks — at 
 least the one whom I suspected of having lodged information against me — 
 was arrested for robbing me, and shortly after my arrival here the custom-house 
 got hold of my books and papers, and on some of them they found some dis- 
 
NEW YORK CUSTOM-HOUSE. 
 
 301 
 
 crepancy in some bill of goods consigned from Paris. The difference, however, 
 was very small, yet they wanted to carry the affair to the courts. Under the 
 advice of some friends, I employed Webster <fc Craig to look into the matter, 
 and see how the thing could be managed. Finally we made a compromise 
 with the custom-house, by paying to the court $10,500. 
 Q. Who suggested that you should pay that amount ? 
 
 A. That I do not know, because I left this entire matter with Webster & 
 Craig. 
 
 Q. Was there a larger amount demanded of you ? 
 
 A. I think there was. 
 
 Q. Do you know how much ? 
 
 A. I do not remember. I was handed afterwards a paper of this charge. 
 Q. Was this on goods you had purchased ? 
 A. Goods partly consigned. 
 
 Q. Were the goods really invoiced less than their valuation abroad — the 
 wholesale valuation 1 
 
 A. I think they were. I think there was a little discrepancy in regard to 
 this matter, and knowing that a litigation would be very long and annoying, I 
 paid the §10,500 ; notwithstanding that I could prove by my letters and books 
 that he had the strictest order to invoice the goods at the real market value. 
 
 Q. Did they take anything other than your business papers and books ? 
 
 A. No, sir. 
 
 New York, January 31, 1867. 
 ANDREW LAUSEN being sworn, testified as follows : 
 Am a member of the firm of Lausen Brothers, importers of laces. 
 
 By the Chairman : 
 Q. How long have you been in that business ? 
 A. Since 185S. 
 
 Q. Have you had any difficulty in getting goods through the custom-house, 
 or have you had any after you got them through ? 
 A. Sometimes. 
 
 Q. Will you state when, and the circumstances ? 
 
 A. In March, 1865, I think it was, we had a difficulty with the custom-house. 
 They claimed that we had taken off an extra discount from what we should 
 have done fioai the invoices; that we undervalued them; and they made us 
 pay §6,000. 
 
 Q. Did they seize your papers and goods ? 
 
 A. They seized papers, goods we had in public store, and goods on the way, 
 and for three weeks we could not do any business. 
 
 Q. What was the amount of the claim they made against you ? 
 
 A. I believe it was $2,400, although the actual amount, according to our 
 books, was seven or eight hundred dollars. 
 
 Q. What amount did they propose you should pay to settle it ? 
 
 A. $6,000 ; which we paid. 
 
 Q. Was this actually an undervaluation % 
 
 A. No, sir. 
 
 Q. What were the circumstances connected with it ? 
 
 A. The circumstances were, that our house in Nottingham, England, invoiced 
 their goods to us m account current as cash, taking off the 2h per cent,, which 
 is usual in England for cash purchases, although they buy certain goods with 
 2\ per cent, and sometimes 5, off for cash ; and other goods they buy on four 
 
302 
 
 NEW YORK CUSTOM-IIOrSK. 
 
 months. Upon all these goods they took the discount of 2h per cent, as be- 
 tween them and us ; and upon these goods they said at tin- custom-house that 
 we had undervalued them more than that, hut that is all that they pretended 
 to prove. They called in appraisers, but the goods were no higher than other 
 people's were. 
 
 Q. Did the commission of 2 .J per cent, foot up to 86,000 ? 
 
 A. No, sir. They claimed 82,400 as the difference between the duties, and 
 the highest price of gold as well ; but the actual difference, according to even 
 that, was 8700. In order to get our goods and go on witli the business, we 
 had to pay them 86,000. 
 
 Q. Did you make an exhibit to them of all your books and letters ? 
 
 A. They had them all. 
 
 Q. Did it appear from this exhibit of papers that there was a systematic 
 intended undervaluation \ 
 
 A. Nothing except this :lh per cent. There was a difference of charges 
 sometimes, but that was with the Knglish house. We did not have to pay any 
 
 duties upon them at all. Our English house Bent ns a charge sheet once a 
 
 month, with different items of charges ; for instance, insurance and all such 
 things, but we did not have to pay upon them. They found those, were not 
 Upon the invoices, and they claimed we ought to pay duty upon them. 
 
 Q. What is the usage of the trade in that lopect? 
 
 A. They do not pay duty on insurance charges and such things. 
 
 Q. Who advised you to settle by paying 86,000? 
 
 A. Our lawyer, .Mr. Kaufman. 
 
 Q. Did he think that your defence was not good ? 
 
 A. lie did not say. \Ye would have to indemnify somebody or other in the 
 full amount of the goods we had in stock, and perhaps the government would 
 put us to an expense of 80, 000 or 86,000, and it would take two or three years 
 to dispose of the case, and we thought, therefore, that it would be for our inter- 
 est to pay the money. 
 
 Q. Was there a suit about it ? 
 
 A. No, sir. 
 
 Q. Who paid the money over? 
 A. Mr. Kaufman, I believe. 
 Q. Did he pay it into court ? 
 
 A. lie paid some person at the custom-house. He never had any receipt or 
 anything to show for it. 
 
 Q. You do not know, then, that the amount was paid over ? 
 A. I do not know. We know that we paid it. 
 
 Astor House, N. Y., January 30, 1S67. 
 ALEXANDER KNOX, being duly sworn and examined by Mr. Hurlburd, 
 testifies as follows : 
 
 Q. Do you reside in this city ? 
 
 A. Yes, sir, and have resided here for fifty years. 
 
 Q. What is your business % 
 
 A. General agent for the United States for the house of On* & McNaught, 
 Glasgow, manufacturers of spool cotton — called thread manufacturers. 
 
 Q. The committee understand that you have had some difficulty with the 
 custom-house ; will you state very briefly what it was, when it was, and the 
 result of it ? 
 
 A. I think it was in the year 1863 I went to Boston for one day, and when 
 I returned I was surprised to find the custom-house officers had been at my 
 store. The old gentleman who had charge of my business they compelled to 
 
NEW YORK CUSTOM-HOUSE. 
 
 303 
 
 open my safe, and they took all of my books, papers, and correspondence, and 
 placed an officer in charge. I was astonished to find that this occurred, as I 
 have been here for fifty years, and never have been charged with any crime of 
 any description. I did not know what to make of it ; so I went to the officers 
 and the surveyor, and then I went to Mr. Daniel Lord, my counsel. As soon 
 as I heard from the custom-house officers the cause of the seizure — that it was 
 for alleged undervaluation — I addressed a* letter to him, reviewing the whole 
 case. They proposed to settle the matter for $13,500. We paid the $13,500, 
 and got our goods. 
 
 Q. Who fixed the amount that you were to pay ? 
 
 A. I never knew exactly. 
 
 Q. Who did you have your interviews with ? 
 
 A. Sometimes with Mr. Hanscom, sometimes with Mr. Franklin, and with 
 the general appraiser, Mr. Dorrence. I had several interviews with him, and 
 several letters passed between us; and I believe with Mr. A. T. Stewart twice. 
 He was selected by Mr. Barney as the merchant appraiser. I wrote Mr. 
 Stewart a letter, and I sent a copy of the letter to each, so they nrght satisfy 
 themselves from the statements made. They attached a great deal of weight to 
 one of the letters received from Mr. McNaught. 
 
 Q. So you paid $13,500 for the alleged undervaluation of spool cotton which 
 cost less to manufacture than cotton to be used for hand ? 
 
 A. Yes, sir. 
 
 Q. Who was that paid to, to the court ? 
 
 A. For form sake it went into court. Mr. Lord and I went up to court and 
 settled it. These things were done very secretly. I spoke to the clerk of the 
 court, and said to him, I understand my friend Mr. Clark has been settling with 
 you. What did he pay 1 He turned over to the folio, and I saw it was about 
 $20,000, and duties in bond. The manufacturers wrote to me that they were 
 willing to sell all the stock they had on hand at the price at which it was en- 
 tered. 
 
 Q. You had no trouble since then ? 
 A. No, sir. 
 
 Astor House, N. Y., January 31, 1867. 
 
 CHARLES HARRIMAN, of the firm of Person & Harriman, being duly 
 sworn, testifies. 
 
 By the Chairman : 
 
 Q. Have you had any difficulties with the custom-house ? 
 
 A. I had goods stopped for a few days. I received the goods on consign- 
 ment, and I wrote to the other side saying that they were seized. I received a 
 telegram in reply to enter the goods at four per cent, higher, but not in any case 
 to exceed that; I did so, and it was some time before we could hear anything of 
 them. I went down and saw Mr. Holmes, the appraiser. He said for some 
 reason or other he was told not to pass the goods for the present, but to hold 
 on to them. The next steamer that arrived from Europe brought me some 
 letters from the house in Europe, among which was one they had received from 
 a man by the name of Farwell, who signs himself Mr. Jones. I took the letter 
 and compared it with my invoice, and I found my invoice was two per cent, 
 higher than the prices given to Mr. Jones. At the time I got this letter I went 
 down and spoke to the collector, handed him the letter and he said : " You had 
 better go and see Mr. Franklin." I went, but did not see him. I said, I pre- 
 sume I have to see Mr. Hanscom. I saw Mr. Hanscom ; he said : " Your goods 
 are invoiced too low." I said : How do you make it too low ? I then drew 
 
304 
 
 NEW YOKE CUSTOM-HOUSE 
 
 out of my pocket this letter of Farwell, and said : My dear sir, here is a letter; 
 there is fraud on the face of it ; it i- r-igned Samuel 1). Junes. He s;iid : " He 
 is a very respectable man; he is Mr. Farvvcll's father-in-law." I called his atten- 
 tion to the fact that our invoice was two per cent, higher khan the prices given 
 in the letter I had received. I called again the next day, and he told me the 
 invoice had taken iis regular course, which caused a delay of three we« -ks in 
 our sales, and pecuniarily damaged us very considerably, and lost the sale of the 
 ribbons. 
 
 Astmr Hot SH. X. Y.. January 31,^1867. 
 BARTHOLOMEW BROWN, being duly sworn, testifies as follows. 
 
 By the Cm ai km an \ 
 Q. Are you in the importing trade ? 
 
 A. Yes, sir; silk goods. My business is don* through a house here. I buy 
 the goods myself in gold, and know the value of them. I have very little 
 knowledge of the custom-house, except the transaction I had last season. 
 
 Q. AVill you give me the particulars of that ? 
 
 A. I was in Paris last summer and purchased a lot of goods for early fall, in 
 the shape of fancy bonnets, which were very fashionable and very desirable. 
 1 found no difficulty in regard to them until about two hours before they were 
 to be appraised and the forfeit put on. The moment I found that, I called an 
 appraiser. I got two per cent, extra discount ; twelve per cent, they allowed, 
 and I got fourteen per cent. The unfortunate part of the matter was, the clerk 
 of the house on the other side put an invoice in the case without a discount, and 
 the goods were entered with a discount oft', which made a discrepancy of four- 
 teen per cent. The goods were paid for at the rate I bought them, with the dis- 
 count. The ordinary discount 1 admit was twelve per cent. There was, per- 
 haps, fifteen or twenty dozen of the goods. They laid in the custom-house for 
 three weeks, and I went to Mr. Smythe and asked him if he would put me on 
 the track to find out what the difficulty was ; that I lost on the goods on ac- 
 count of the delay ; they were articles unfit for the sec son. I called for a re- 
 appraisment, and they had four appraisers, who sustained my point through in 
 the whole matter, by parties who bought goods of that house. It is a very- 
 fashionable house in Paris. That is the history of the case. They sustained 
 me, and I got my goods three weeks after the season for them was over, and I 
 am out of pocket considerably on account of getting them too late. The party 
 who shipped the goods knew nothing of the transaction. Mr. Smythe simply 
 put me on the track of getting the goods through. 
 
 Q. At his suggestion whom did you apply to ? 
 
 A. He sent me to Mr. Franklin and the bull-do j of the concern, Mr. Hanscom, 
 who treated me very roughly and as a pickpocket. I am not usually called a 
 dishonest man, and it went very hard with me at the time. I had just returned 
 from Paris. When there, I went to one of these extreme modistes ; for instance, 
 in one article, I paid six and a quarter francs a metre for an article of bonnet 
 trimming. I bought one piece, and I took a sample of it to my agent, and I 
 said, I want this produced for me; what can it be done for? He gave it out to 
 a fabricant, and produced it for thirteen francs — five metres and a half. I 
 could not see any difference ; made of the same material in every way for thir- 
 teen francs — five metres and a half — which I paid six and a quarter francs for 
 a metre. The difference is this : In Paris there are a large number of small 
 fabricants who instead of creating the picture they copy it. The custom-house 
 officers say to me, why, Mr. Brown, you have got goods that you pay six and 
 
NEW YORK CUSTOM-HOUSE. 
 
 305 
 
 a quarter francs a metre for, and here you are fetching goods out at thirteen 
 francs for five and a half metres under another invoice — there is a fraud on the 
 face of it. There was an article for trimming hats which I bought at twenty- 
 two francs a dozen, and I took it to my agent, and he produced me the identi- 
 cal thing, as far as my judgment goes, and I got that for sixteen francs. Now, 
 I have got that dozen for twenty-two francs coming out, and I have got the 
 identical thing coming out in another invoice at sixteen francs. What can the 
 custom-house do ? These are the facts. 
 Q. What do you do at the custom-house ? 
 
 A. I do only one thing. Whatever I pay for goods I enter them at at the 
 custom-house, if I was to forfeit them. 
 Q. Do you enter them on the average ? 
 
 A. No, sir; what I pay for them. I enter the lot that I paid sixteen francs 
 for at sixteen francs ; and the lot that I paid twenty-two francs for I enter at 
 twenty-two francs. 
 
 New York, January 15, 1867. 
 
 HARRY J. BANG sworn and examined. 
 
 By the Chairman : 
 Q. Are you in the importing business ? 
 A. Yes ; we import wines. 
 
 Q. Have you had any detentions or seizures by the custom-house ] 
 
 A. Yes ; my books and papers were seized. 
 
 Q. When was that ? 
 
 A. Two years ago. 
 
 Q. State the circumstances. 
 
 A. I kept a restaurant at the time ; and one day Mr. Hanscom, Mr. Brown, 
 and eight or ten others came to my place of business and asked for my books, 
 as they wanted to investigate an invoice of some wines I imported in bottles. 
 They said it was entered too low. The reason of the price being a little low 
 was, that my father, when in Germany two or three years before, bought the 
 bottles and our agent filled these same bottles with the wine, and of course it 
 reduced ihe price, and that was the only difference in the invoices. They seized 
 the books and took them away, and found a few letters, in some of which they 
 said they found the goods were entered too low ; but we supposed the difference 
 would not be more than five or six hundred dollars. They took my books 
 away, and closed my place of business for four or five weeks. I went to my 
 lawyer, Mr. Steinbrunner, and engnged him to settle the matter with the cus- 
 tom-house. Mr. Steinbrunner had a conversation with Mr. Hanscom and Mr. 
 Dennisson, and tl ey asked from him $25,000 to settle the case. Then they 
 came down to $12,000, and I settled the matter. I went to the United States 
 court, and some old gentleman there took the money. 
 
 Q. Did he give you a receipt ? 
 
 A. No. 
 
 Q. How long ago is it since you settled it ? 
 
 A. Two years last fall. 
 
 Q. Had you any difficulties since ? 
 
 A. No. 
 
 Q. Why did you pay $12,000 if there was only $500 or SG00 difference ? 
 A. I wanted to continue my business which was broken up by my place be 
 ing shut up ; and I also wanted to get back my books and papers. 
 H. Rep. Com. 30 20 
 
306 
 
 NEW YORK CUSTOM-HOUSE 
 
 New York. January 10, 1867. 
 
 FRANCIS MANN swora and examined. 
 Q. Are you engaged in mercantile business 1 
 A. Yes. 
 
 Q. Have you had seizures by the custom-house ? 
 
 A. I had. of wines. In September, 1S64, some custom-house officers came 
 to my place and pretended to have proofs that I had defrauded the government, 
 and they seized my books and papers and took them away and kept possession 
 of them for about three weeks, until I made an arrangement to pay 510,000. 
 They found a difference in the prices of Rhine wines, but it would not amount 
 to half the amount I had to pay. It would not amount to four or five thousand 
 dollars, and they Bearched back three or four years. I employed Mr. Hauflfman 
 as my lawyer. 
 
 Q. Did the custom-h use people endeavor to get more money from you? 
 A. They tried to get all they could. They first asked S^0,000, and then 
 they came down to $15,000, and finally, as a favor, they took $10,000. 
 
 Q. Who did you see at the custom-house when you made this arrangement? 
 A. It was my lawyer made the arrangement. 
 
 New York, January 1G, 1867. 
 LAZARUS SOMBORN sworn and examined. 
 
 By the CHAIRMAN : 
 Q. Are you iu the importing business ? 
 A. I am an importer of German and Rhine wines. 
 Q. Had you any difficulties with the custom-house? 
 
 A. I had ; the custom-house officer came to my place in September, 1S64, 
 and read me an affidavit some persons made that I defrauded the custom house. 
 They took possession of my books and papers and took them away, and left 
 an officer in charge of the store, and also shut up my other places of business. 
 
 Q. How long was the officer in charge of your store ? 
 
 A. About twenty-four hours. The officer was taken away, and yet they did 
 not send my books back. So I went down to the custom-house and saw Mr. 
 Franklin and asked him why they did not send my books back. He said I 
 would get them in a short time, as they were pleased not to find anything 
 against me. I then got my books back. 
 
 New York, January 18, 18G7. 
 VALENTINE BENNER sworn and examined. 
 
 By the Chairman : 
 Q. Do you receive whines on consignment? 
 A. Yes, sir. 
 
 Q. How long have you been in business as a merchant ? 
 
 A. Twenty-five years. 
 
 Q. What ldnd of wines do you receive ? 
 
 A. Hock; generally called Rhine wine. 
 
 Q. Had you any difficulties with the custom-house ? 
 
 A. Not on account of w r ine. I import Seltzer water, and it was on account 
 of that. About two years ago last October I had some trouble, when eight or 
 ten officers came to my place of business and took possession of my books and 
 
NEW YORK CUSTOM-HOUSE. 
 
 307 
 
 papers, and I did not know their reason for doing so. I went to see Mr. Hans- 
 com, to know why it was done, and he told me I should see Mr. Franklin; so 
 I then went to see him. He told me I had defrauded the government. I asked 
 him in what manner, and he then said, " Here is a letter I received from Europe, 
 and by it I can see you do not enter your mineral water as you should do, at 
 the right amount." He said, "Here is a letter I got out of your safe." In that 
 letter were the prices of plum trees, apple trees, and other sorts which I had re- 
 ceived from Europe. He said the prices at which I had entered the goods at 
 the custom-house were not as much as what was mentioned in this letter. He 
 then sent me to a lawyer, but I did not go to him, but I took my own lawyer 
 along the next morning to him; but he would not recognize him, as he said he 
 knew nothing about it. He told me I had defrauded the government, and that 
 I should pay $15,000 or go to Sing Sing for two years. I told him I would 
 not pay anything. He sent all my books and papers to the United States 
 court. About two weeks after I was at the custom-house I got a notice to go 
 for my books and papers, and I went there and got them. That was the last 
 of it. I think it was tried in the United States court, but I never heard any- 
 thing of it. 
 
 Q. When you went for your books and papers was anything said to you 1 
 A. Nothing at all; but I signed a paper there that at any time I should be 
 called on I was willing to appear. 
 
 Q. Who was present in the naval office besides Mr. Franklin ? 
 
 A. No one except my lawyer and me. He locked the door when we were in. 
 
 Q. Who was present the first time ? 
 
 A. No one except Mr. Franklin and me. 
 
 Q. When did he tell you you had to pay $15,000 ? 
 
 A. In the presence of my lawyer he said thaL 
 
 New York, January 16, 1867. 
 
 HENRY C. BOWEN sworn and examined. 
 
 By the Chairman : 
 
 Q. You reside in this city and publish a paper ? 
 A. Yes ; I publish the Independent. 
 
 Q. There was a charge made against A. T. Stewart & Co., for omitting in 
 their hosiery invoice to charge for bands and cartoons. Do you know anything 
 of it? 
 
 A. I know this much about it : that a young man who was in my employ, 
 and in whom I had a great deal of confidence, stated to me that he knew of 
 immense frauds in that way, and desired to know what to do. He came to me 
 because he said his conscience troubled him, and he wanted me to advise him. 
 I told him if he knew of any fraud being committed it was his duty to inform 
 the government of it. He said, " I don't know any of them at the custom-house, 
 and yet I cannot rest without getting this matter off my mind." I said, "I will 
 go with you and introduce you at the custom-house," and I went with him to Mr. 
 Barney, who referred us to Mr. Dennisson. We went to him and laid the whole 
 matter before him, and I introduced the young man to him as a person of in- 
 tegrity, and that his statement may be relied on. Mr. Dennisson heard his 
 whole story through, and then said he thought it did not amount to much, and 
 that such a man as A. T. Stewart would not engage in it, and he did not think 
 anything would come of it. The young man said, " Sir, I can prove every- 
 thing I say, and if you commence an examination I can go and point out the 
 books that will convict him. I know that frauds were committed to the amount 
 of several hundred thousand dollars." I went then to Mr. Barney and told 
 
NEW YORK CUSTOM-HOUSE. 
 
 him that if t?uch frauds existed and could be proved by Stewart's books, it was 
 a shame for the government if they did not take up the case and investigate it. 
 When Mr. .Jordan was here lie sent for me to see him, and I asked the young 
 man to go down with me. lie did so, and told him there was no (juestion of 
 the existence of the frauds, and that they amounted to hundreds of thousands 
 ol dollars. He knew the case, as he was principal in the very department, and 
 had verbal instructions from Mr. Stewart about it. 
 Q. What finally came of it ? 
 
 A. Nothing ever came of it. The young man wrote to Mr. Jordan at Wash- 
 ington, and even went so far as to threaten to make some exposure. 
 
 Q. It is stated in a memorandum given to the commit tee that the sum 
 amounted to three millions, on which the duty would be $105,000 ? 
 
 A. I heard it was an immense sum, but no amount was stated. I was satis- 
 fied from what I saw that there was ;i want of disposition on the part of the 
 custom-house authorities to take hold of the matter. 
 
 Q. Did this young man see either of these gentlemen when you were not 
 with him ? 
 
 A. He did. I told him to go aud see about the matter. 
 
 ALBERT HANSCOM. DEPUTY COLLECTOR, IN C HARGE OF THE SEIZURE 
 BUREAU, AND MESSRS. WEBSTER A ( h'AIG. 
 
 New York, January 12, 18G7. 
 DANIEL T. WALDEN sworn and examined. 
 
 By the Chairman : 
 Q. What is your business ? 
 A. I am a lawyer. 
 
 Q. Had you anything to do with the United States ? 
 A. I have had. 
 Q. In what case ? 
 
 A. In the cases of Geraud, Barbay & Co. 
 Q. Were you employed by them ? 
 A. I was, on the 4th of January, 1865. 
 Q. Did you prosecute the suit ? 
 
 A. I appeared in the district court of the United States where information 
 had been filed against their goods and a decree had been passed against them. 
 The district attorney opened the cases, by consent, and permitted me to put in 
 an answer ; and I filed my answer on the 7th January, in both cases. My 
 clients then desired to have the goods bonded, and. Mr. Barbay sent me the fol- 
 lowing note on the third of January: 
 
 January 3, 1865. 
 
 Dear Sir: The number of cases of 2d lot of ribbons seized are: G. B. 546-9, bj Scotia, 
 27th July; 584, by Persia, 22d September. 
 
 I left word with Mr. Hanscom that you would be there about one o'clock. 
 Yours truly, 
 
 HENRY J. BARBAY. 
 
 Mr. "Walden. 
 
 I went to see Mr. Hanscom and introduced myself to him as the attorney of 
 the parties. I talked to him, and wanted him to fix the amount of this bond on 
 the valuation of the goods, and I had one or two interviews with him on the 
 subject. The next thing I heard was, my clients came to me, in a hesitating 
 way, and said, "Mr. Walden, we have no want of confidence in you, but we 
 have been advised that we had better have Webster <fc Craig as our lawyers." 
 
NEW YORK CUSTOM-HOUSE. 
 
 309 
 
 I said very well, if you want any other lawyers besides me you can have them, 
 and I gave them a letter agreeing to the substitution of Messrs. Webster & Craig 
 in my place as their lawyers in the case. 
 
 Q. Do you recollect if your clients told you who advised them to employ 
 Webster & Craig ? 
 
 A. They said Mr. Hanscom advised them to employ Webster & Craig. 
 
 On the 12th of January I gave consent to substitute Webster & Craig as 
 attorneys in the case. In response to the following letter I sent the substitu- 
 tion to them that ended my connection with the case : 
 
 Office of Webster & Craig, No. 29 Nassau Street, 
 
 New York, June 12, 1865. 
 Dear Sir : We have the copies of three informations filed in importations by Geraud, Bar- 
 bay & Co. ; copies of your answer in two cases, (four cases GB, 546 to 549, one case marked 
 G c B 584, ) and other memoranda. You have not sent us copy of your answer in the other 
 case, (G B No. 536 to 541, ) nor copies of your claim in any of the cases. We should be glad 
 to receive those if you have them. 
 
 We also send a substitution for your signature. 
 Yours truly, 
 
 WEBSTER & CRAIG. 
 
 Sterling & Walden, Esquires. 
 
 New York, January 14, 186T. 
 SAMUEL J. GLASSY sworn and examined. 
 
 By the Chairman • 
 Q. What is your occupation ? 
 A. I am a lawyer, practising in New York. 
 Q. What do you kuow of these revenue seizure cases ? 
 
 A. Late in the month of May, Mr. A. J. Dittenhoeffer, a lawyer of this city, 
 requested me to act as counsel in a case of seizure for violation of the revenue 
 laws, alleged to have been committed by Brunner & Co. He informed me that 
 goods imported by them to the value of $30,000 had been seized for undervalu- 
 ation ; and that their books had been taken by Deputy Collector Hanscom, and 
 two officers left in charge of their store. He requested me to act with him in 
 defending the suit, and to exert myself to have the officers removed from the 
 store. I called to see Mr. Draper the same day, and he said he could do noth- 
 ing until he could consult Mr. Hanscom. I urged on him to have the officers 
 removed from the store, but he said Mr. Hanscom had charge of the matter, 
 and he could not interfere with him. That afternoon I went to see Mr. Hans- 
 com, and told him I appeared for Brunner & Co., and I wanted to know the charge. 
 He was then engaged in examining the books, which were spread out on the table 
 before him. He said, " If you are going to defend this man, you have a tough 
 case before you. We have got goods to the amount of $30,000, which will cer- 
 tainly be condemned, and I have found in their books conclusive evidence of 
 fraud on which penalties to the amount of $200,000 will be recovered. I have 
 proof of it, and if they want to make a settlement they had better make up their 
 minds pretty quick about it." I told him the only matter I cared to talk to him 
 about then, was the removal of the officers from the store. He said he would 
 confer with Mr. Draper next morning, and that that matter would be adjusted. 
 I then reported to Mr. Draper, who said probably the man would be removed 
 next day. The next day, at 10 a. m., I went to Mr. Draper's private office, and 
 while I was there Mr. Hanscom came in. He called Mr. Draper aside, and 
 conferred with him for a few moments. Draper came to me then, and .said, " I 
 thought you were counsel for Brunner & Co., in this seizure case." I said, "I 
 am." Hanscom looked at me and smiled, and said, " You are not quite quick 
 
310 
 
 NEW VOKK CU8TOM-HOU8E. 
 
 enough, Mr. Glassy ; Webster cV Craig have made an offer to settle that case, 
 and I have recommended the collector to accept it." " What do you Hay to 
 that?" said Mr. Draper. I said, " I will not say anything; yon represent the 
 interests of the government, while I represent, if anything, the interests of Brun- 
 ner & Co., and I don't think I can do anybody good by saying anything. It 
 is a dirty piece of business." I then walked out of the office. That settlement 
 was for $20,000, or 825,000. I was informed subsequently that Webster 
 < 'raig sent word to Brunner & Co. that they could settle this claim for 820,000 
 or 52.'3,000. Brunner & Co. authorized that amount to be offered, and it was 
 offered and accepted by Mr. llanscom. At three o'clock on Monday, the claim 
 was for $200,000 ; and at 10 a. m. the next morning it was settled for $20,000 
 or $25,000. Mr. Dittenhoeffer brought me into the matter because he supposed 
 my personal relations to Mr. Draper would induce him to act more favorably 
 to us. 
 
 Q. Did you hear from any source that Webster & Craig sent to them to 
 tell them their goods were going to be seized ? 
 
 A. I was informed by Mr. Dittenhoeffer that before the. seizure was in;»de 
 they said their goods were to be seized, and that they could effect a settlement. 
 
 New York, January 14, 18G7. 
 A. J. DITTENHOEFFER sworn and examined. 
 
 By the Chairman : 
 
 Q. W T hat is your profession ? 
 A. I am an attorney-at-law. 
 
 Q. As such have you defended, or been called upon to defend, suits growing- 
 out of the revenue seizures ? 
 
 A. I don't think I have defended a suit relating to customs duties. 
 
 Q. Were you not employed by the house of Brunner & Co. ? 
 
 A. I was consulted by them in reference to their custom-house difficulties. 
 
 Q. I understood you were retained by them ? 
 
 A. I was not retained as counsel ; I think the case was compromised. I know 
 I never appeared in the case. 
 
 Q. What do you know about the settlement or disposition of the case ? 
 
 A. I was called upon by Samuel Brunner, who stated to me that his books 
 and papers had been seized, and keepers placed in his store by custom-house 
 officers. 
 
 Q. What time was that ? 
 
 A. Nearly a year ago. I asked him what the charge was, and after consid- 
 erable inquiry he said he understood the charge to be for having duplicate in- 
 voices. He asked me to do what I could about it. I w r ent to see Mr. Hans- 
 com and Mr. Dennisson, and could get but very little satisfaction from them, or 
 make but little progress. The first thing I knew after that w T as that Webster 
 &: Craig were retained by Brunner, and that they settled the case — I think by 
 compromise, but I don't know. I simply know they settled it very speedily. 
 
 Q. While you were connected w r ith the case were there any propositions 
 made to you to settle, or was there any amount claimed ? 
 
 A. There was no proposition, but there was a suggestion made that it would 
 take a very large amount to settle it ; and intimations were given to me that it 
 was a very big fraud, by Messrs. Dennisson and Hanscom. 
 
 Q. Do you recollect whether any sums were named to you — any round 
 sums ? 
 
 A. I will not be positive, but to the best of my recollection, I think a sum in 
 the neighborhood of SS0,000 w r as named. 
 
NEW YORK CUSTOM-HOUSE. 
 
 311 
 
 Q. Do you recollect how long after this it was settled ? 
 
 A. I understand within a very few days after they were retained to settle it. 
 I went one day to see Mr. Dennisson about it, and he told me the books were in 
 the room being examined, but that the extent of the deficiencies had not been 
 ascertained, but they would be very large. Some time after I met Mr. Brun- 
 ner, and he told me that they had done nothing wrong and were not liable, but 
 that they had settled it for the sake of obtaining peace. 
 
 Q. Were you engaged in any other revenue cases ? 
 
 A. I had with internal revenue, but nothing with external revenue. 
 
 New York, January 17, 1867. 
 ALEXANDER ISAACS sworn and examined. 
 
 By the Chairman : 
 Q. Are you in business here now ? 
 A. I am, at 59 Pine street and at G Wall street. 
 Q. What is your business ? 
 A. I am a custom-house broker. 
 
 Q. Were you formerly connected with the eustom-house as special aid ? 
 A. I was. 
 
 Q. How long have you been acting as broker ? 
 A. Two years the 13th of September last. 
 
 Q. In your transactions with the custom-house, have you had more or less 
 to do with the seizure business ? 
 
 A. Not myself, personally ; but some of my customers have had. At A. 
 Maillard's, in Broadway, there was a seizure made, but everything was found 
 to be correct. 
 
 Q. Do you know the circumstances that led to it 1 
 
 A. The only thing I know of it is, that the same evening that it took place 
 they sent for me, as I was their broker, to tell me of it. They said the officers 
 had taken charge of their premises and taken possession of their books and 
 papers, and that they did not know the reason. When I went there I asked 
 where the officers were, and I was told they were down stairs searching for 
 books and papers. I went down stairs and found Colonel Van Brunt, Mr. 
 Chalker, and other officers there. I talked with them for some time, but could 
 get no clue to the reason for seizing the books and papers. Several days after, 
 Mr. Maillard went with his lawyer to the custom-house and got them back, as 
 they were found to be correct. 
 
 Q. Do you know the alleged cause of that seizure I 
 
 A. I do not. There was another case I know of, a gentleman had his stores 
 seized in Maiden Lane. I did not do his business, but he sent for me to get 
 him out of this difficulty. He paid some twelve thousand dollars I believe, 
 probably more, to settle it. 
 
 Q. Do you know what the alleged cause for the seizure was there ? 
 
 A. For fraudulently entering his goods. 
 
 Q. Do you know anything of Mr. Stursberg's case ? 
 
 A. I happened by accident to hear the revenue officers say that they were 
 going to make a siezure — I think about a year since — on the store of Stursberg. 
 That evening coming from my office I met Mr. Stursberg. The devil at that 
 moment tempted me, and I said to him, " Mr. Stursberg, I understand that the 
 revenue officers are going to make an examination of your place to-morrow." 
 " Well," said he, " I am very well satisfied ; they can come to-morrow or to- 
 night, or at any other time they like." Said I, " I will feel very much obliged 
 to you if you do not mention that you got that intelligence from me ; " and he 
 
312 
 
 NEW YORK CUSTOM-HOUSE. 
 
 told me that he would hot The next morning, as I am informed, the custom - 
 bouse officers went to the Store and seized the books and papers, and brought 
 them to the custom-house, but after a short investigation they were returned to 
 him. Some few days after that ft piece appeared in one of 'the paprr.-, .-peaking 
 of the outrage that had been committed on an Ann rican citizen, and stating that 
 he had received information o!" the visit from an officii] twenty-four hours ahead 
 of the officers coming to his place. The surveyor at once sent for Mr, Sturs- 
 berg to know from whom he had received the information, and be told them 
 from me. They sent for me, and I went there, and Mr. Stursberg and his law- 
 yer were there. He asked me if ] knew thai gentleman — pointing to Mr. B tars- 
 berg — and I said, I did not know him " Well,'' said he, "do you know Mr. 
 Stursberg? " I said, "I have heard of that gentlem m." Said be, "Now did you not 
 tell him the revenue officers wen* going to his place to seize his books aud papers ? " 
 I meditated for a moment, and 1 answered "I did tell him so." He then asked if I 
 did not consider I had broken faith. J told him 1 did not ; that I was not a sworn 
 officer nor bound to keep the secrets of the government. 1 than said I regretted 
 having done such a thing; that I had been intrusted with important things in 
 my office, and that it was the only thing I ever mentfoned, and that it was done 
 on the spur of the moment when 1 met the devil and he tempted me to do so. 
 Mr. Wakeman then .-aid Ik- would .-top me from doing any business in the cus- 
 tom-house. 1 told him I had done nothing wrong; I had not cheated the gov- 
 ernment, or any one else. He said I had communicated this information. I 
 said if I was a sworn officer I would not have done so; that I regretted having 
 done so, and would not get into the Bame trap again ; that I would not see any- 
 thing for the future. 
 
 Q. How did you get this information ? 
 
 A. I was going through the place to the surveyor's office, and, passing out 
 through a private door, I heard Mr. Kirk Van Boskeick and another gentleman 
 talking together. I heard them say something about a warrant, and I then 
 heard Stursbreg's name mentioned : so, coupling both together, I suspected 
 what it was. But it was as much guess-work as anything else. 
 
 New York, January 17, 1S67. 
 
 JOHN KANSKI sworn and examined. 
 
 By the Chairman : 
 
 Q. Are you a clerk in the naval office ? 
 A. I am. 
 
 Q. What bureau are you attached to 1 
 
 A. I act as amendment clerk and as general clerk. 
 
 Q. Do you have anything to do with the seizure business 1 
 
 A. I do". 
 
 Q. Who is the head of the seizure bureau in the custom-house ? 
 A. I think Mr. Hanscom is. 
 
 Q. From whom do instructions issue to make the seizures of stores, books, 
 papers, &c? 
 
 A. I should judge from Mr. Hanscom or from the collector; but Mr. Hans- 
 com is always consulted in the matter. 
 
 Q. Are you directed usually to accompany the persons making the seizures ? 
 
 A. They send for me. 
 
 Q. What instructions do you receive? 
 
 A. To take all the foreign correspondence, invoices, books, letters, &c. 
 Q. Where are the books and papers carried to ? 
 A. To Mr. Hanscom's room. 
 
NEW YORK CUSTOM-HOUSE. 
 
 313 
 
 Q. Does your agency end with the carrying of them? 
 A. No ; I help to examine them. 
 
 Q. Are yon consulted in reference to the differences found in the invoices or 
 papers, or as to the lines and penalties ? 
 
 A. Not always. I take the custom-house invoices and compare them with 
 the invoices the party has. I then take the ledger and I turn to the account 
 where the invoice is, and if there is anything wrong I note it on the invoice, or 
 on the page of the journal or invoice-book. Mr. Wagner, the translator, looks 
 over the papers, and if he finds duplicate invoices he hands them to Mr. 
 Franklin to compare with the government invoices. And after the whole ex- 
 amination is gone through there is a list made out, and the amount paid entered 
 on one side, and the amount that should be paid on the other. 
 
 Q. Are these differences always the basis on which the fines are imposed? 
 
 A. That is more than I can tell. 
 
 Q. Were you ever consulted in reference to how much the fine or penalty 
 should be on parties in such an exhibit ? 
 
 A. No ; I was never consulted except on one occasion. 
 
 Q. Do you know who gives the information to the seizure bureau ? 
 
 A. No. 
 
 Q. Do you know how they obtain it i 
 A. No ; I never was informed. 
 
 Q. Did you ever hear Hanscom or any of the others say anything about it? 
 
 A. At one time Mr. Hanscom showed me some information, and asked me 
 if I knew the party, or if I had been there before, because I kept a memoran- 
 dum of all the places visited. 
 
 New York, February 1, 1S67. 
 B. G-. KELLAM, being sworn, testified as follows : 
 By the Chairman : 
 
 Q. Are you connected with the revenue service ? 
 
 A. Yes, sir ; I am captain of the revenue cutter Crawford. 
 
 Q. How long have you been in the service 1 
 
 A. Above twenty -three years. 
 
 Q. How long have you been captaiu ? 
 
 A. About two and a half years. 
 
 Q. Do your duties enable you to know anything of the coasting trade, so 
 called ; of any delinquencies on the part of such vessels in complying with the 
 revenue laws ? 
 
 A. Yes, sir ; I have to board these vessels, examine them, and make my re- 
 ports, if any are delinquent. 
 
 Q. You have discharged that duty since you have been captain of the Craw- 
 ford ? 
 
 A. Yes, sir. 
 
 Q. What number do you think you have reported? 
 
 A. I think, upon a rough guess, I have reported 150, and 1 have received no 
 notice, after I have informed of such delinquencies, in regard to t lie matter ; I 
 think I have been treated badly in that respect. I made my reports to the col- 
 lector of the custom-house — at one time to Mr. Clinch, at one time to Mr. Dra- 
 per, at one time to Mr. King. I have made none to Mr. Smythe. I came in 
 contact with Mr. Hanscom, as I was always referred to him. In the last six 
 months I have boarded and reported no vessels whatever, because I came to the 
 conclusion that it was useless to do so, and I informed Mr. Hanscom to that 
 effect. An instance occurred, that I now recollect, in reporting these vessels 
 
314 
 
 NEW YORK CUSTOM-HOUSE. 
 
 which 1 will give you. I had seized a vessel bound to Virginia, the Ann Pick- 
 erel, with a rebel cargo on board, and I reported her to the collector of customs, 
 and the matter was by him referred to Mr. Hanscom. The .district attorney, 
 upon my report alone, brought the case to the attention of the court, and by 
 the court the vessel was condemned by default. When the distribution of tin- 
 prize was to take place, there was another claimant, an outside claimant, fished 
 up for the occasion. I suppose so, because the parties who owned the vessel 
 never came forward when she was condemned by process of law. 1 was told 
 by my clerk that Mr. Ilanscom wanted to sec mo on I nsiness connected with 
 this vessel. I accordingly called upon him, and was told by him that the whole 
 thing was referred to him by Mr. King, and it depended entirely upon me 
 whether I should receive the informer's share or whether the other claimant 
 should have it. This he repeated three or four times, and he waited for my an- 
 swer. It was an intimation to me — "pay mi and I will decide in your favor." 
 I said, "No, sir; I will go to the courts first." The matter is still before the 
 court. 
 
 Q. What was the amount involved I 
 
 A. $11,000; the share for my retsd wmild liave been one-half. The assist- 
 ant district attorney, Ethan Allen, is perfectly acquainted with the whole affair. 
 I have since that made perhaps 100 reports of vessels. I have reported all the 
 steamers at the harbor of New York for violations of law. 
 
 Q. To whom did you make such reports ? 
 
 A. To the collector, and the collector referred them to Mr. Ilanscom. Once 
 in a while I go up to the district attorney's office and inquire if they have re- 
 ceived my reports, and the reply is, that Mr. Ilanscom has written them to dis- 
 continue the suits. These are for violations of the law in regard to the inspec- 
 tion of boilers. There was one noticeable instance, which I remember well, that 
 occurred before I decided not to report any more vessels. I reported to the 
 collector the case of a vessel from Boston, American bound, without a manifest, 
 evidently intended for smuggling. While I was in Mr. Hanscom's office the 
 following day the captain of this vessel came in, and, not knowing me, says to 
 Mr. Hanscom : " I understand I have been reported by the captai n of the rev- 
 enue cutter for violation of law." Mr. Hanscom had his hat on at the time, 
 and he took him right out of the room. The next day the district attorney re- 
 ceived instructions to discontinue this suit. 
 
 Q. What are the penalties or fees imposed for such violations ? 
 
 A. Five hundred dollars for steamers running without their inspection papers ; 
 for other violations twenty-five or thirty dollars each. If the case is taken into 
 the United States district court it will cost perhaps fifty dollars ; so it will cost, 
 where the simple penalty is twenty-five or thirty dollars, seventy or eighty dol- 
 lars to get out of court. 
 
 Q. Do you know wdiether in any of these cases that have been reported, the 
 captains of the vessels have appeared and paid I 
 
 A. I do not know, because Mr. Hanscom generally receives these gentlemen 
 himself. All we know is that we learn at the district attorney's office that Mr. 
 Hanscom has told them to discontinue the suits. 
 
 Q. Could they be discontinued on the payment of the money ? 
 
 A. Mr. Hanscom having it in his power, merely says discontinue, and he can 
 make whatever arrangement he pleases with the captains. I seized the General 
 Scott, evidently intended, by her character, for the rebels. Mr. Shirley, deputy 
 surveyor, came down with the steamer Bronx, and told me that he would like 
 to take the vessel and protect her as government property. So he took the 
 vessel up to the city, and when I came to inquire about her I found Mr. Shir- 
 ley's name on Mr. Hanscom's books as the informer instead of my own. 
 
 Q. Did you make any representations to Mr. Hanscom or any one else with 
 reference to your rights ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 315 
 
 A. I made my usual report to the collector, but it was uot noticed. 
 Q. When did you commence making reports ? 
 
 A. About March 11, 1865 ; for the last six months I have not made any. 
 
 Q. In reporting vessels for violation of the revenue laws, do you include the 
 outgoing and the incoming vessels 1 
 
 A. All. I reported probably from 100 to 150 vessels, at least, in six months — 
 for every species of violation of the revenue laws. 
 
 Q. Have you any idea what proportion of these were steamers ? 
 
 A. Fifty or sixty — at least two-thirds of them. 
 
 Q. Have you any knowledge, from captains or otherwise, that the owners of 
 vessels have paid their fines or forfeitures ? 
 
 A. I do not think they have paid their fines ; I think they have bought him 
 (Hanscom) off, because it is no interest to him to receive the fines. The assist- 
 ant district attorney (Mr. Simons) cannot imagine why these suits should be dis- 
 continued. The Staten Island and the Brooklyn ferry-boats were reported not 
 only for not having their boilers inspected, but for not having their names at 
 their wheel-houses- 
 
 Q. What is the date of the Ann Pickerel case ? 
 
 A. The 11th of March, 1865. There were a number of vessels reported for 
 not having their manifests made out, but I never heard anything from them. 
 Q. What is the penalty in these cases ? 
 
 A. Fif f y dollars for foreign vessels and twenty dollars for coasters. 
 Q. Have you received any money as your informer's share from any of these 
 reports ? 
 
 A. I have only received twenty dollars in the last two years as my inform- 
 er's share. 
 
 Q. Will you give the committee a statement of the reports you have made to 
 the custom-house, with dates, names of the vessels, captains, consignees, &c, 
 while you had command of the Crawford ? 
 
 United States Revenue Cutter Crawford, 
 
 New York, February 2, 1867. 
 
 Sir: In obedience to your orders, dated February 1, 1867, I have the honor to make the 
 following report relative to vessels seized or reported to the collector of the customs for the 
 port of New York, since August, 1864, the date of my command : 
 
 Reported the following vessels to Simeon Draper, esq., viz : February 9, 1865, schooner 
 General Scott, of Baltimore, from New York, bound to Baltimore ; seized articles on board 
 not on the manifest, evidently intended for the rebels. Vessel delivered, by request of Mr. 
 Shirley, deputy surveyor, for the purpose of placing her in the hands of the collector. 
 
 (Note. — Vessel subsequently condemned and sold, no returns made.) 
 
 March 11, 1865, schooner Ann Pickrell, of New York, from New York for Washington, 
 D. C, W. A. Leaman, master. Seized articles on board not on the manifest evidently in- 
 tended for the rebels ; delivered to R. Murry, esq, United States marshal, and subsequently 
 condemned by due process of law and no returns made. 
 
 The following vessels have been reported for violation of the act of June 8, 1864, section 4 : 
 
 April 7, 1865: steamer Westfield, Staten Island ferryboat; steamer Middletown, Staten 
 Island ferryboat. April 8, 1865: tug S. E. Babcock, E. Barrett, master; tug U. S. Grant, 
 A. R. Berry, master; tug Wm. A. Brown, B. P. Hasset, master; tug Wyoming; tug 
 Peter Crary. April 12, 1865 : tug H. Lapharn, Williams, master, Rich, agent. April 13, 
 1865 : tug Niagara, Stellwagen, Sutton, and others, owners, belonging to Albany. April 
 16, 1865: tug Champion, of Connecticut, Betts, master, W. Marshal, ageut, 72 South street. 
 April 27, 1865: tug Washington, W. D. Farnald, master and agent, 43 South street, New 
 York. May 20, 1865: reported the following ferryboats belonging to the Union Ferry Com- 
 pany, viz: Pacific, Montague, Baltic, Nassau. May 22, i860: Exchange, Metropolis, 
 Republic. Union, Hamilton/ America, May 23, 1865: New York, Warren, Canada, Su- 
 perior. June 6, 1865: Arizona, Cayuga, Idaho, Suffolk, Nebraska. 
 
 The following steam ferryboats belonging to same company reported for violation of act 
 of May 5, 1864, section 1 : Roslyn, Superior, Arizona, Pacific, Idaho, Warren, Republic, 
 Baltic, Union, Hamilton, Canada, Exchange, America, Montague. New York, Metropolis. 
 April 17, 1865, schooner Margaret Maber, of New York, P. Calkin, master and owner, no 
 papers on board : schooner Genius, of Staten Island, A. Kohnsen, master, no papers on 
 board. April 25, 1865: tug A. R. Gray, of New Jersey, George Deming, captain and 
 
316 
 
 NEW YORK CU8TOM-HOU8E. 
 
 agent, 59 Houston street, Jersey City, no license, in violation of the acta of February In, 
 179:5, section JO, ami July 8, 1864, section 4. April 27, 1805: tug Washington, W. I). 
 Farnakl, 43 South street, New York, master and agent, in violation of the act of June 8, 
 1864, section 4. April 28, 1865: tug (J. W. Geer, S. J. .Snider, master, for violation of tin- actl 
 of February 18, 179:5, section 10, and June 8, 1864, lection 4. May II, 1866: tog .! K. 
 Gailo, J. K. Gaile, master and agent, 22 South sln-et, N'- w York, for violation of th ac o! 
 February 18, 179.!, .section 10, and June 8, 1864, section 1. S.-pt.-mb. r 22, MJ5: to Preston 
 King, esij., brig Dawn of Day, fi inn ( 'icnfuegos Cuba, tor New York, Edward Vere, master, 
 in violation of the act of March 2, 1799, section 20, having but one manifest and 1,200 cigars 
 not on that. The following vessels hav • been reported to C. 1'. Clinch, esq., February^!, 
 1800: Italian bark I5agio. from Palermo, cargo, fruits, consigned to Lawrence (Jib >* A ( o., 
 New York, no manifest. February 2-. b-00: ship Midnight, of Uoston, bom Wampoa, 
 China, J. E. Crosby, master, cargo, tea, no manifest, in violation of the act of Ma: ch 2, 
 1799, section 2G. February 2-\ 1-66: British brig Anticello. from Antwerp, McClelen, 
 master, consigned to II. .). Dewolfe A Co., New York, no manifest, in violation of the 
 act of March 2, 1799, section 20. February 27, 1866: Mritish bark Mystery, from Mar- 
 seilles, for New York, Caughai, ma-ter, cargo, madder ami wine, <-msigncd to 'l5ate> A Du 
 Vester, No. 80 Heaver street, no manifest, in violation of the act ol March 2, )?:'.». section 
 20; Norwegian bark Esmarella, from Amoy, China. Beck, master, cargo, tea, consigned to 
 Messrs. Morewood & Co., NVu York, no manifest. March 12. 1866: Dutch schooner 
 Jacoba, Kheinders. master, from Buenos Ayres, cargo, wool, no manifest. March 19, 1866: 
 Danish bark Danehray, from Kio do Janeiro, 11. ('. Hansen, master, cargo, coffee, consigned 
 to Simeon De Virrer, Ueueon street, no manifest. March 19. 1866: English ship BothweU 
 Castle, from Hongkong. J. Paine, master, consigned to Cary & Co., 91 Pine street, no 
 manifest. March 23, 1860: British brig Julia, from Rio do Janeiro, Blitz, master, cargo, 
 logwood, consigned to Messrs. Kandle, Jones A. Rudge, Front street, New York, no mani- 
 fest. March 23, 1866: brig Fidelia, from Bnenoe Ayres, Leland, master, general cargo, 
 consigned to Edward F. Davidson, 128 Pearl street, do manifest March 27. I866i English 
 ship William, from Cardiff, Charles Hawes, master, consigned to Edwards & Co., BowliDg 
 Green, no manifest. All of which no returns have been made. 
 
 I have the honor to be, verv respectfully, vour obedient servant, 
 
 B. J. KEEL AM, 
 Captain V, 8. Ihrcnue Service, Commanding Cutler Crawford. 
 Hon. C. T. HULBUBD, M. C, 
 
 Chairman of Committee on Public Expenditures, Washington. D. C. 
 
 Custom-house, New York, February a, 1807. 
 Sir: In obedience to your request, I transmit herewith a statement of moneys paid into 
 the custom-house during the last three years for fines, forfeitures, or penalties imposed upon 
 steamers, ferry-boats, and sailing vessels for violation of the navigation and revenue laws. 
 I am, very respectfully, your obedient servant, 
 
 S. G. OGDEN. Auditor. 
 
 Hou. C. T. HULBURD. 
 
 Statement of moneys paid into the custom-house at New York, (from January 1, 1864, to De- 
 cember 31, 1866,) for fines, forfeitures, or penalties imposed upon steamers, ferry-boats, and 
 sailing vessels for violation of revenue laics. 
 
 1864. Sept. 7. Sloop R. Udall and schooner R. Knapp $60 00 
 
 J866. Feb. 27. Sloop Chatham 20 00 
 
 March 20. Steamboat Atlas 500 00 
 
 May 15. Brig Anticello 25 00 
 
 May 15. Schooner Ann Pickerel 14,560 94 
 
 Oct. 31. Schooner George Greene lGijjfj 
 
 Oct. 31. Sloop S. A. Cunningham and schooner Cataract 40 00 
 
 Dec. 29. Sloop Clinton 30 00 
 
 Total 15.245 04 
 
 United States Revenue Steamer Bronx, 
 
 New York, February 4, 1867. 
 Sir : I am in receipt of j'our letter of the 1st instant, requesting me to send you a detailed 
 statement of all cases of violations of the revenue laws reported by this vessel during the past 
 three years., with the amount of fines to be imposed, &c. 
 
NEW YORK CUSTOM-HOUSE. 
 
 317 
 
 I would respectfully state that, this vessel has been engaged upon this duty but seventeen 
 months, and that most of the cases reported have been reported to the collectors of customs 
 at New Haven and Bridgeport, in all of which cases the fines have been imposed and paid. 
 
 Some five or six cases have been reported to the collector of New York which have not 
 been settled, which are the only ones in which the fines are still to be imposed. 
 
 I am unable to give you the names of owners or consignees ; but if you require it, I can 
 give you all the other details in regard to the cases reported, which are nearly all under the 
 act of February 18, 1793, for want of manifests of cargoes, <fcc. 
 I am, sir, verv respectfully, 
 
 D. C. CONSTABLE, Captain. 
 
 Hon. C. T. Hllburd, 
 
 Chairman of Committee on Public Expenditures, 'Vashington, D. C. 
 
 Q. Row do you get your supplies for repairs, &c? 
 
 A. I make a requisition upon the Secretary of the Treasury ; that goes to Mr. 
 Smythe, the collector, and he sends over to R. G. White, a clerk in the revenue 
 department at 23 Pine street. 
 
 Q. From whom do you get the supplies ? 
 
 A. From Harrison & Bros.. 261 West street; they are the contractors for the 
 revenue cutters. 
 
 Q. Do you know anything about the amount of requisition that would come 
 to your vessel for a year ? 
 
 A. I should suppose it varied from 8150 to $200 a month — say about 82,000 
 a year for each vessel. 
 
 Q. Have you one of the requisitions with you ? 
 
 A. I have the last one made, (witness producing it,) for the month of Feb- 
 ruary, 1S67 ; it has been approved of by Mr. Smythe, and by R. G. White, the 
 examiner. It is a remarkably small requisition. 
 
 Q. What is the amount of it 1 
 
 A. $45 39. 
 
 Q. Look over it and tell me the prices charged for the articles, and what in 
 your opinion you can get them for elsewhere ? 
 
 A. I find charged here one set of augur bits, $7 S7 ; I can get them for $1 50 ; 
 one glue-pot is charged $2 60 ; I can get it for $1 00 ; one door latch and catch 
 is charged $2 25, which I can get for 37 .V cents ; one nautical almanac is charged 
 $1 50 ; I don't know exactly what the price of that would be, bat I should sup- 
 pose 50 cents would be the margin ; one pair of dividers, $2. which I can get 
 for 50 cents ; one Gunter's scale is charged $-1 CO, which I can get for 50 
 cents; one door-lock for pantries is charged $2 50; I should judge that would 
 be about 75 cents ; one small lamp, $4 75 ; I should suppose at the most 
 that would cost 50 cents — a small lead lamp ; soapstone griddle is charged 
 $3 75; worth about $1. One third of the articles upon this schedule are not 
 required, and things that we do require are not upon it at all. 
 
 Q. Who fixes what articles shall go into the contract ? 
 
 A. Mr. White. The collector authorizes him to make the schedule out to 
 suit himself. 
 
 Q. The nine articles in this bill which you have named, and which are en- 
 tered at $31 02, I find can be obtained according to your statement at about 
 $7 12, making a difference of over-charge in this bill of $23 90 ? 
 
 A. Yes, sir. 
 
 Q. Are such charges as that customary 1 
 
 A. Yes, sir. I made out a requisition for a tell-tale lamp, which they charged 
 $1 for. I run my pen through it and taid I would not receive the article. 
 I paid 25 cents for one out of my own funds, and made a present of it to the gov- 
 ernment. 
 
 Q. How many revenue cutters are there in New York ? 
 
 A. There are the Bronx, Crawford, Uno, Jasmine, Kankakee, and Cuyahoga ; 
 theee are in commission now. As to the two new ones that are building, the 
 
318 
 
 NEW YORK CUSTOM" HOUSE, 
 
 contractor of the revenue cutters, under the direction of Mr. White is making 
 hammocks, bags, and awnings that rightly belong to tin- sail-inakri . 
 (}. Did you not supply your own ves.-.-l I 
 
 A. I did, with rigging, sails, &c. In lifting the rigging, I found that it WMt 
 all rotten, and I was afraid it would fall to pieces. I made a verbal order on 
 Mr. White, and he told me that he thought the letter he had received from the 
 collector, or rather that the collector had received from the Secretary of the 
 Treasury, covered the whole amount required, and to go on and make the re- 
 pairs, and go to Harrison & Bros, for the supplies. I told him he would charge 
 too much. I went to a regular rigger, a man who was in the business — reduced 
 his bill as much as I could, and he agreed to make an allowance for old rope, 
 and also deducted five per cent, off his bill. After getting it reduced as much 
 as I could, the bill was sent <>n t«» the Treasury Department, and it was al- 
 lowed. 
 
 Q. How much did you save the government in that transaction? 
 A. At least $2,000. 
 
 ASSAM WAKKMAN. si:RYKY< >h\— SUTL1KS OF STEAM KRS 
 
 Astor Hot >K. X. V.. January 30, 1867. 
 CHARLES F. SCHIRMER, being duly sworn and examined by Mr. Hurl- 
 burd, testifies as follow- : 
 
 Q. Are you the agent of a steamship line here ? 
 
 A. I am the manager of the Bremen steamship line, of the house of Oeli ichs 
 & Co., since it was established, in 1S58. 
 
 Q. Is it a part of your duty, or does it come under your supervision, the pur- 
 chasing of supplies for that line of steamers ? 
 
 A. Yes, sir. 
 
 Q. Have you at any time been approached by any of the custom-house officers 
 with the intimation that such and such persons had better be patronized ? 
 
 A. Yes, sir, it has been asked of us to patronize certain persons. 
 
 Q. Will you state when it was, who it was, and the nature of the request ? 
 
 A. I think it is about six months ago, as near as I can recollect, that the 
 deputy surveyor, Mr. Van Brunt, came to my office with a Mr. Schalker and 
 Mr. Kirk. Van Brunt told me that Kirk, being a butcher by trade, had a good 
 chance to get into a well established business here ; that his friends, among 
 whom was the surveyor, were trying to get capital 10 buy him an interest in the 
 business, and that it was necessary that he should have a certain custom and 
 bring it into the business. Mr. Van Brunt was entirely the spokesman. He 
 told me that he thought it would serve the interest of our company by employing 
 Kirk, because, he being befriended by Mr. \Yakeman, it would save us a great 
 deal of trouble now and then as matters were. At that time I refused to en- 
 tertain any propositions of the kind. I told him we were perfectly satisfied 
 with the man we had ; that we had him for eight years, and saw no reason to 
 change. I was then again importuned by him on another occasion, perhaps a 
 fortnight later, and I told him I would not listen to any proposition of the kind, 
 because it would be the beginning of a bad system. I told him that the next 
 surveyor might have some ship-chandler, or ship carpenter, or blacksmith that 
 he would want to introduce to us, and ultimately we would have in our employ 
 men that we w r ould be at the mercy of. As a further inducement they told me 
 that my private meat and private poultry would always be at my service with- 
 out any charge to me. "When they said that that settled the matter. 
 
 Q. Had your line been subjected to any annoyance in consequence of your re- 
 fusal ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 319 
 
 A. No, sir ; I did not feel any bad effects from it. I made up my mind the 
 moment we did I would write to headquarters. The way I spoke to him at once 
 settled the question. They were very kind then. I must say 1 never found 
 them so kind as I did since. 
 
 New York, January 31, 1S67. 
 JOHN G. DALE recalled and examined. 
 
 By the Chairman: 
 Am the agent of the Ininan Steamship Line. 
 
 Q. Have you been approached by any person connected with the custom- 
 house upon the subject of purchases of stores for your steamers, and have you 
 had any inducements held out by any such person ? 
 
 A. No inducements have been held out. I have been asked as a personal 
 favor, by parties in the custom-house, to buy my stores of certain parties, but 
 nothing more was said than that. 
 
 Q. Who asked you ? 
 
 A. The surveyor. 
 
 Q. When? 
 
 A. It must have been several months ago; six months, probably ; it was 
 during the last year. 
 
 Q. From whom did he ask you to buy ? 
 
 A. The firm of Lowrie & Co., butchers. 
 
 Q. Did he give any reason why he wished you to buy ? 
 
 A. No, sir; simply except one of his aids was, he said, connected with these 
 stores, and he would take it as a personal favor if I could consistently give him 
 any part of the business ; there was nothing more than that. There was no 
 promise of anything. Mr. Wakeman I have known a long time in connection 
 with the post office, and he used to be friendly with us, as a post office official, 
 in our mail matters. I was disposed to oblige him, because he was disposed to 
 be very kind to us. 
 
 Q. Did you comply, in any instance, with his request ? 
 
 A. I did ; I promised to do it, provided the parties supplied me as well and 
 as cheap as others. I gave them a part of the business, and I was well satisfied 
 with it. In fact, I would rather have the present arrangement than the old 
 arrangement, giving the supplies to one, because I have the benefit of competi- 
 tion. 
 
 New York, January 14, 1SG7. 
 THOMAS HAGAN sworn and examined. 
 
 By the Chairman : 
 
 Q. Have you been connected with the custom-house ? 
 A. Y~es. 
 
 Q. In what capacity? 
 A. Night inspector. 
 
 Q. How long did you hold that position ? 
 
 A. About seven months. 
 
 Q. Were you dismissed % 
 
 A. I was. 
 
 Q. For what ? 
 
 A. I could not tell, exactly; but I suppo33, for being a re^ubl can. 
 Q. Did you make any seizures while you were in office ? 
 
320 
 
 NEW YORK CUSTOM-HOUSE. 
 
 A. I did ; one keg of .Jamaica rum, containing about ten gallons; another 
 keg of the same size, but I cannot tell what sort of liquor it contained ; two 
 smaller kegs, holding about five gallons each ; and a row-boat, and a pair of 
 sculls. 
 
 Q. What did you do with them \ 
 
 A. I made out my seizure returns, and left copies of them with the collector, 
 naval officer, and surveyor, and turned over the things to the seizure depart- 
 ment. 
 
 (j) Were you not entitled to the informer*! .-hare? 
 
 A. 1 understood from the surveyor that I wan. He told me, after I made 
 these seizures, I was entitled to a portion. 
 Q. Did you ever get it ? 
 A. No. 
 
 Q. Did you ask for it ? 
 
 A. I did ; from Mr. Wakeman. 
 
 Q. What did he say to you I 
 
 A. He told me to go into the seizure department, and see if the goods were 
 sold. I saw by the books that the seizure was made", but eaw no disposition 
 made of the case, i went back and told him I was discharged, and if anything 
 was made of it I would like to have it. He told me he had not time to attend 
 to it then. 
 
 Q. How long after the seizure was made did you arjply for your share ? 
 A. Between four and five months. 
 Q. Did you call on him since then ? 
 A. No. 
 
 Q. Did you know whether the go ids had been sold or not ? 
 A. I did not. 
 
 Q. Do you know now if they were sold ? 
 
 A. I know they were appraised and measured ready for sale, and that there 
 was a lot sold since. 
 
 Q. You have never been able to get any account ? 
 A. No. 
 
 Q. Did vou make any other seizures ? 
 A. No. 
 
 New York, January 14, 1SG7. 
 
 JOHN GAUTIER sworn and examined. 
 
 Q. Have you been connected with the custom-house ? 
 
 A. Yes ; under three different administrations. 
 
 Q. How Jong ? 
 
 A. Eight years, in all. 
 
 Q. Are you connected with it now ? 
 
 A. No. 
 
 Q. When did your connection with it cease ? 
 A. On the 8th of July last. 
 Q. Why did it cease then 1 
 
 A. Mr. Wakeman, the surveyor, recommended my removal. Mr. Wakeman 
 told me I would be removed ; and then I went and asked Mr. Smythe, and he 
 told me he did not know anything about it. I said that Mr. Wakeman told me 
 I would be removed, and he said : " I suppose what Mr. Wakeman said is all 
 right." Before that there was a petition came to me to sign. This petition 
 was to get up a ratification meeting for Mr. Johnson, and came from one of 
 Wakeman's clerks. When he called on me to sign it, I said : " I will not sign 
 
NEW YORK CUSTOM-HOUSE 
 
 321 
 
 it to save his neck." He said the rest would sign it; but I said I did not care, 
 that I would not sign it.' That passed off, and three or four days afterwards 
 Mr. Wakeman told me I was going to be removed. 
 Q. What were you doing in the custom-house ? 
 
 A. I was a night inspector. Last August the surveyor made a speech, and 
 said that any persons that made seizures should receive their shares of the 
 seizures. In consequence of that some of the men did make some seizures, but 
 none of them ever received anything. The men who made these seizures lost 
 a great deal of time going to the custom-house, and they never received one 
 cent for it. Mr. Thos. Hagan seized a boat with four casks of liquor in it, at 
 Hoboken, and lost a day bringing the boat to the barge office. Mr. Wakeman 
 promised to give him his share of the proceeds, but I understand he never got 
 anything; but the remark was made to him, if he did not support the President 
 he would be turned out ; and he was turned out. A man named Simon Came- 
 ron seized fourteen yards of cloth, and a man named Wilcox made some seiz- 
 ures, but they never got anything out of them. I could name a dozen others 
 who also made seizures and gained nothing by doing so. I only knew one 
 man — and he was a policeman — to get anything. He made Mr. Wakeman 
 come down. 
 
 Q. Why were you turned out, was there any fault found with you ? 
 
 A. No ; but 1 was sick for three months and could not attend ; I showed them 
 the doctor'? bill for $60. Mr. Wakem m asked me why I was absent when I 
 went back, and I told him I had been sick, and then he asked me for the doc- 
 tor's certificate, I had not one then, but I said I could get one. He said you 
 are to be removed, but I was not for six weeks after. 
 
 Q. Do you know why you were removed 1 
 
 A. I don't. Smythe told me he did not know anything about it. 
 
 Q. Did you not receive a notice of your discharge 1 
 
 A. I always received a paper notifying me of it, but not this time. 
 
 Astor House, New York, January 10, 1867. 
 JOHN S. BE MAS sworn and examined. 
 
 By the Chairman : 
 Q. What is your business 1 
 
 A. I was formerly connected with the New York custom-house as inspector. 
 
 Q. While so connected did you see baggage passed without being opened ? 
 
 A. I saw twenty-five large trunks pass, one only being opened. Trunks be- 
 longed to Cornelius Grinnell, a city shipping merchant. The surveyor of the 
 port was on the dock at the time and saw or could have seen the whole trans- 
 action. 
 
 Q. Do you know of any other cases % 
 
 A. I have known baggage come off the steamers checked or chalked and 
 passed without being examined on the wharf. 
 
 Committee Room on Public Expenditures, 
 
 House of Representatives, Washington, D. C, 
 
 February 25, 1867. 
 
 JOHN HITZ being duly sworn and examined, testified as follows : 
 
 By the Chairman : 
 Q. Are you the consul general of Switzerland? 
 A. I am. 
 
 H. Rep. Com. 30 21 
 
322 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Is thin paper wh>ch I now show to you an original ? 
 A. It M so. 
 
 Q. Is it at the service of the committee ? 
 
 A. It is. And likewise the following extracts from a pamphlet just issued 
 by me. 
 
 State or California, 
 
 City and County of San Francisco, ss : 
 
 On this twentj-ninth day of January. A. 1>. one thousand eight hundred and sixty-seven, 
 before me, Einile V. Sutter, a notary public in and for Bald city and county, duly commis- 
 sioned and sworn, personally appeared A. de Stoutz, who, In ing by me duly sworn, does 
 depose and say that he is one of the firm of Ed. de Eutte, and a resident ol said city and 
 county; that it is known that a few official of the San Francisco custom-housi have, in the 
 last few years, hy a system of the most outrageous and high-handed proceedings, enriched 
 themselves at the expense of the foreign merchants of this port Their conduct was such as 
 finally to attract the attention of the authorities at Washington, and they were removed. 
 
 Among- the last acts of their official duties was to i nter the store of the Swiss firm of 
 Ed. de Kuttc and seize an invoice of watches, under pretence that they had heeu under- 
 valued. 
 
 Said watches had been imported and duties paid for on the following' dates: 
 1 watcli on the 19th of March. Mi2. 
 
 4 watches on the 80th of November, J -»>::. 
 
 5 watches on the 21st of December, 1663. 
 25 watches on the 17th of .Inly. MM. 
 
 10 watches on the Mth of December, 1864. 
 
 45 watches entered for the sum of 10,424 francs. 
 
 Aforesaid seizure was made by the United States marshal, Ch. W. Rand, at the instiga- 
 tion of W. B. Earwell, J. T. MacLean, and others. The marshal took possession, subject 
 to the decision of the court, which decided that the property should be restored on the filing 
 of .sufficient security. The owner of the w atches, having subsequently occasion to sell them, 
 tendered the security ordered by the court and demanded the watches. After much delay 
 and prevarication, the United States marshal, Rand, produced all but five of the most valuable. 
 He alleged that one of them had been lost at the time of the fire at the court-house. The 
 four others he said had been, on the requisition of MacLean, sent and delivered to W. B. 
 Earwell, on pretence that the latter would verify their value in Europe. 
 
 These watches were, it will be borne in mind, placed in the custody of the marshal to be 
 delivered to the owner on his giving security. This marshal lost five of them, and on the 
 demand of the owner, refused to pay for them their market value, .$565 70 in gold coin, or 
 give any satisfaction in the matter. He admits, virtually, that his accomplices took four of 
 them ; and these persons, being still in the employment of the federal government, retain 
 possession of them in contempt of the order of the court directed to Marshal Ch. 13. Rand to 
 deliver them up. 
 
 Certainly a broader case of spoliation never before presented itself in any country. But 
 this was not all. The marshal, Ch. W. Rand, intimated that if any measures were taken to 
 enforce payment of these watches, or to bring the matter before the public, the interest of the 
 owner would suffer in the future seizure trials, as well as in his capacity of an importing 
 merchant, thereby holding out the threat that he would, perhaps, be further despoiled by 
 illegal means, under the pretence of enforcing the custom-house laws. 
 
 These laws, under the present tariff, are so loose, so voluminous, and so contradictory, 
 that most merchants are in the power of vindictive, rapacious, and unscrupulous officers, 
 such as these persons complained of have shown themselves to be. It is therefore in the 
 highest degree necessary that the particular attention of the highest authorities should be 
 directed to the frauds here noted. 
 
 In presence of — 
 
 [l s.J A. DE STOUT, 
 
 Of firm E. DE RUTTE\ 
 
 Subscribed and sworn to the 29th day of January, A. D. 1867, before me 
 
 [seal.] E. V. SUTTER, Notary Public. 
 
 State of California, 
 
 City and County of San Francisco, ss : 
 I, William Loewy, county clerk of the city and county of San Francisco, and ex officio 
 clerk of the county court and of the fourth, twelfth, and fifteenth district courts of said 
 county, (which are courts of record,) do hereby certify that E. V. Sutter, whose name is 
 subscribed to the annexed affidavit, was at the date of the same, and is now, a notary public 
 
XEW YORK CUSTOM-HOUSE. 
 
 323 
 
 in and for said city and county, duly commissioned and qualified, and authorized by law to 
 administer oaths, and full faith and credit are due to all his official acts as such. And I do 
 further certify that the signature attached to the annexed instrument is genuine. 
 
 In witness' whereof, I have hereunto set my hand and affixed the seal of the said twelfth 
 district court, at my office, in the city and county of San Francisco, this 29th day of January, 
 A. D. 1-67. 
 
 [seal.] WILLIAM LOEWY, 
 
 County clerk of the city and county of Sari Francisco. 
 
 CONSULAT DE LA CONFEDERATION SUISSE A SAN FRANCISCO. 
 
 Vu par nous soussigne, vice consul de la Confederation Suisse a San Francisco, Etat de 
 Californie. Etats Unis d' Amerique, pour legalisation des signature et sceau ci dessus de 
 William Loewy, clerc de comte et ville de San Francisco. 
 
 En foi de quoi, notre signature et sceau consulaire. 
 
 San Francisco, '29 Janvier, 1867. 
 
 [seal.] A DE STOUT, Vice-consul. 
 
 Extracts from Consul General Hitz's pamphlet presented to the Committee. 
 STATEMENT of SARASIN & CO. 
 
 Sir : In accordance with your permission we take the liberty of submitting herewith a 
 statement relative to the seizure of goods at New York which has so seriously affected our 
 firm. These seizures were made upon information from Mr. Farwell, to whom, as shown by 
 annexed tables, we furnished on the fourteenth August for goods deliverable about first 
 October, prices 7-£ to 8 per cent, above those of our consignment invoices to New York. 
 
 As an explanation concerning that difference of rates between our consignment invoices 
 and the prices given to Mr. F., we have to say that this gentleman wished to place an order 
 with us deliverable in two months, and that after due consideration of the improvement of 
 political affairs in Europe and the advance of the raw material, we came to the conclusion 
 that this increase of about eight per cent, was necessary to protect ourselves. 
 
 We have further to add that we are ready to show our books and prove to any commission 
 named, that we were selling to our European trade the same goods at the time or date of our 
 consignment shipments to New York, at the same rates, and even to some parties at a fraction 
 lower. 
 
 These facts of plain truth, once proved, are conclusive, and we deem it entirely unneces- 
 sary to enter into any further explanation other than to refer to the appended tables and let- 
 ter from Leaf Sons & Co. 
 
 SARASIN & CO. 
 
 Basle, December 16 s , 1866, 
 
 London, Old Change, November 26, 1866. 
 
 Gentlemen: Willingly complying with your inquiries as to our experience of the rela- 
 tive prices of ribbons during the months of July and August of this year, we answer them 
 by stating that between the 17th and 31st of July an average augmentation of 7^ per cent, 
 was demanded upon the prices of the different widths of two current descriptions of ribbons 
 which we constantly order, and upon one of which that advance was paid. 
 
 The above dates are given as being the period at which we were contemplating placing 
 some of our usual orders for the autumn : aud the two special articles referred to are such as 
 we believe will serve as a fair criterion for the advanced prices asked by the several manu- 
 facturers at Basle for the articles of their production. 
 
 We may add that during the following month of August an increased price was asked 
 upon those quoted in July. 
 We are, &c, 
 
 LEAF SONS & CO. 
 
 Messrs. Sarasin & Co., Basle. 
 
 [The signature is certified by the American consul in London.] 
 
 statement of von der muhll brothers. 
 
 Basle, December 15, 1866. 
 SIR : The undersigned, established in Basle since 1843 as manufacturers of silk goods, 
 are successors to their father, Von der Muhll-Hoffoiann, who, as we do now, made consider- 
 able consignments to the United States. 
 
 Before the United States consul legalizes our invoices, we have to make our declarations 
 in his presence by tilling a blank form, (see page 325,) declaring that the invoice prices are 
 the actual market value. 
 
324 
 
 NEW YORK CUSTOM-HOUSE. 
 
 There exists no difficulty in establishing the market value of many articles, even \vov< n 
 fabrics, while in the case of others it is impossible. In general, we would observe that 
 the fabrics of each manufactory have peculiar properties, such as brilliancy, touch, dura- 
 bility, &C M which peculiarities are highly valued by souk — by others not esteemed at all. 
 The same goods, then-fore, are not worth the same money to all buyers. In the estimation 
 of the manufacturer, purchasers are also very unlike. The one may be considered a good Cus- 
 tomer, the other not so good. There exists often, also, at one and the same time, for quite 
 similar articles, considerable difference in the prices of the various manufacturers, as some 
 may have large stocks which they desire to reduce, Of anticipate for the future this or that. 
 
 In regard to our fabiics, a question can only br raised as to the article vros di Xa/jlts 
 sou/tie, (of which samples and prices were requested from us by a certain Mr. Jones, upon 
 who.se representations, we are informed, our goods have been seized,) and I'unlt dr. .fair, 
 frame smtpU. We sell these t wo articles almost exclusively to the United States ; scarcely 
 1 per cent, of our production finds a market mi the continent. What is now the market 
 price of this article here .' Its sale here could only be effected at a very low price. In fact, 
 the market value here is no other than that of New fork. We bold that the cash price of 
 our manufactured articles, taken in connection with the amount they will probably bring at 
 sale, in our case establishes their market value; and thereby have we always been guided. 
 It is also possible that the market value is sometimes even lower than the cost price. Cer- 
 tain it is that when raw silk is very high, cost can seldom be attained. In regard to our 
 seized goods, wo can prove that the prices of silks were lower last summer than those we 
 adopted as our basis. <>ur stock across the Atlantic was large, and the prospect poor, which 
 was verified by the fact that the goods remained unsold, or sold at very low prices. As 
 proof thereof, we state that said invoices were :'>:» percent, higher than the appraised value 
 of the goods seized. 
 
 By the foregoing statement we believe to have conclusively shown that it is utterly impos- 
 sible for us to determine the dr facto market price' for our fabrics as it can be done for other 
 articles ; and we therefore solemnly protest against being charged with fraud. In special 
 reference to the prices we gave to Mr. .lone-, we would state that he was a perfect stranger 
 to us, without the least recommendation, and we therefore did not care much to do business 
 with him. If he accepted our prices we would have done a very good business. Besides, 
 the prices we asked of him were by no means the market prices, for purchasers thereat must 
 first be found. We would like to see what bona tide New York importer would have pur- 
 chased from us at the prices we asked of Mr. Jones. 
 
 VON DEK MLTILL BROTHERS. 
 
 STATEMENT OF LUC PREISWEKK. 
 
 Sm: The custom-house in New York seized in September, 1866, a number of boxes con- 
 taining silk ribbons belonging to the house of Luc Preiswerk, asserting the goods were in- 
 voiced too low, as there existed a difference between these prices and those asked of two 
 unknown persons during the early part of August, 1866, who, w ithout giving any references, 
 pretended to be purchasers for the Cauada market. It seems that one of said persons, who 
 first introduced himself by the name of W. B. Farwell, of Montreal, and to whom I stated 
 my prices as they were marked on the samples, desired only to obtain a price list from me. 
 I afterwards received a letter from Samuel D. Jones, of which a copy is annexed, as also 
 other documents referring to this matter, showing that said party gave false references, for 
 the purpose of inducing me to believe he deserved credit. Among the confiscated boxes 
 were some marked H 5— P, the others J. P. The boxes marked H B — P contained plain 
 taffetas ; the boxes J P contain plain taffetas a lisiere rondes and basselisses. It is proved by 
 enclosed tables that the goods in the two specified boxes have not been invoiced at lower 
 prices than I obtain for regular orders. 
 
 H B— P taffetas nnis is an article I manufacture largely in current qualities, on looms to 
 a great exteut scattered about the country, where, according to the greater or lesser ability 
 of the weavers, (who but seldom can be watched,) fabrics are sometimes produced of great 
 inequality. I have therefore to make two distinct classes of this same fabric, of which the 
 first is of a superior character, and intended to fill custom orders, whilst the other comprises 
 all foods of an inferior grade or worse finish. These latter goods are reserved for my con- 
 signments to Messrs. Barbey & Co. in New York. Though the difference between these 
 two classes is often 8 to 10 per cent,, I generally, on an average, set it down at 5 per cent., 
 and I am accustomed to adopt this rate in my invoices of consignments. The accompanying 
 table shows that my consignments to the United States have been invoiced at higher prices 
 than noted in my account sales to customers during the same period up to August, 1866. 
 
 STATEMENT OF FREY, THURNEYSEN & CHRIST. 
 
 Basle, December 14, 1866. 
 SIR * \ppended vou wiH find a blank of the declaration furnished by the United States 
 consulate and in conformity to which we are required to make out our invoice for consign- 
 ment. L Vou will see that we have three main points to certify : 
 
NEW YORK CUSTOM HOUSE. 
 
 325 
 
 1. That the prices are actually the market value. 
 
 2. That the discounts mentioned are really allowed to the purchaser. 
 
 3. That no other than the duly legalized invoice is given to consignees. 
 As to Nos. 2 and 3, no questions have ever been raised. 
 
 In regard to No. 1, we have only to say there exists no established market price for silk 
 goods, and it is impossible there should. We have, therefore, for some time invoiced prices 
 at the rates we would sell for to a good purchaser the amount of our invoice. We cannot give 
 direct proof thereof, because we have nowhere sold for a long time similar fabrics to those we 
 sent to New York on consignment, our manufacturing facilities enabling us only to keep our 
 regular consignees supplied. We may add. that the consulate well knows similar qualities 
 are invoiced even lower than ours, and yet are not incorrect. 
 
 On the 7th of August last a certain Mr. W. B. Farwell introduced himself to us, falsely 
 representing he was a merchant from Canada. He was accompanied by an unknown person, 
 whose name, as we learned afterwards, was Violier, an ex-consul of the United States. Mr. 
 Farwell inquired the prices of our ribbons ; but as he was wholly unknown to us, and gave 
 no references, and as we at the time were fully occupied in supplying our consignees, there 
 existed no disposition on our part to make direct sales. Knowing, too, that Zurich silks 
 going via England were being smuggled from Canada into the United States, it occurred to 
 us that by selling to this ostensible Canadian smuggler we might actually create in New 
 York dangerous competition to our consignees in the identical fabrics made by us and con- 
 signed to them. We gave Mr. Farwell, therefore, prices about 15 to 20 per cent, higher than 
 those invoiced to our consignees. Whether we, in doing so, did anything punishable, or even 
 unusual, we leave any tradesman to judge of. Nevertheless, this circumstance is considered 
 proof sufficient in New York to justify prosecution for alleged fraud. We have to remark 
 yet, that Mr. Samuel D. Jones asked us in writing, under date of August 29, for our prices, pre- 
 tending to be purchasing for California; and as his correspondence pleased us better, we 
 stated to him prices 10 per cent, lower than we did to Mr. Farwell. This difference is a proof 
 that in stating our rates to unknown persons we act arbitrarily, or, in other words, that hun- 
 dreds of circumstances influence prices thus given where it is questionable whether business 
 transactions will really take place. Therefore they can surely not be considered as estab- 
 lishing market value. We have since been informed that Samuel D. Jones is a fictitious 
 name, and that the letters so signed were written by Mr. Farwell's mother-in-law. Mr. Far- 
 well sent the price-list we gave to him to New York, and afterwards went there himself to 
 instigate the custom-house authorities against us. 
 
 They confiscated all our consignments to the three houses of H. Barbey & Co., William 
 Kieter <&. Co., and Escher & Co. ; whereof 16 cases were to Barbey & Co , 16 cases to 
 Kiefer & Co., and 6 cases to Escher & Co. 
 
 Barbey <fc Co. gave bond, and after unsuccessful attempts to have justice accorded to 
 them by the Secretary of the Treasury, at once declared their intention to institute legal pro- 
 ceedings. We would remark that among the seized cases there are some containing different 
 qualities of silk ribbons, w T hilst we had only been giving samples of one article (taffetas noir) 
 to Mr. Farwell. As to our other qualities, (taffetas a lisiere ronde pure sole, taffetas tuousse- 
 line, couleurs trammes Chappce, ) the custom-house cannot have the remotest reason for its 
 proceedings, and furnishes, therefore, an additional evidence of its arbitrary dealing. 
 
 The custom-house should perceive our loyalty, from the fact that we raised our declarations, 
 towards the end of August, 5 per cent., and at the end of September 5 per cent, more, thus 
 following the upward tendency of the prices of raw silk. 
 With great respect, 
 
 FREY, THURXEYSEN & CHRIST. 
 Consignment. 
 
 I, , of , do solemnly and truly declare that I am of the goods, 
 
 wares, and merchandise in the within invoice mentioned and described ; that the said invoice 
 is in all respects true ; that it contains a full and true statement of the actual market value of 
 said goods, wares, and merchandise at the time and place when and where the same were 
 manufactured or procured, of the actual quantity of said goods, wares, and merchandise, and 
 of all charges thereon; that no discounts, bounties, or drawbacks are contained in said in- 
 Toice, except such as have been actually allowed thereon; and that no invoice different from 
 the one now produced has been or will be furnished to any one. I further declare that it is 
 
 intended to make entry of said goods, wares, and merchandise at the port of , in the 
 
 United States of America. 
 
 this day of , 186—. 
 
 COMMUNICATION FROM J. DOBLER, ESQ., OF THE FIRM OF ESCHER & CO. 
 
 NEW YORK, January 3, 1867. 
 Escher & Co. imported, per steamer New York, on the 5th of October, 1866, B. J. 539 to 
 541, and per Teutouia, 10th October, B. J. 542 to 544, six cases plain taffetas ribbon*, which 
 were seized by the custom-house on the 17th October, 1866, without being examined, merely 
 
326 
 
 NEW YORK CUSTOM-HOUSE. 
 
 because tin- owners, Messrs. Frey, Thurneysen & Christ, in Basle, asked higher juices to u 
 Mr. Fuiwell. Said ribbons are invoiced from live to ten per cent, highet than any ribbons 
 of like quality which came at the same time, and were passed at the public stoic without the 
 least trouble by other houses ; and even since, the custom-house has passi d ribbons from the 
 same manufacturers at lower prices. 
 
 We entered said six cases for consumption, paid the duties, and pave a bond, for the full 
 amount of the appraised value a month ago, and yet we have not got the goods up to thi> 
 day. 
 
 STATEMENT OF J. J. H.\< KOIT.N v SONS. 
 
 BA8LE, December 18, 1-06. 
 
 Silt: Enclosed we have the pleasure to hand to you the juices we pave to Mr. Jones, and 
 those we invoiced to our house, Messrs. Christ, Jay & Co., in New York, at which the poods 
 have been seized by the custom-house. 
 
 You will clearly see that there is no reason for the seizure, and that it would be unjust if 
 the goods are not delivered to us at once without further trouble. 
 
 We also add the ju ices invoiced to several American buyers for poods delivered to them for 
 their own account. These juices prove clearly that we invoiced the real market juices, viz: 
 the very same at which we sold our poods to our best and m«>t important customers. 
 
 You will remark, however, that to Mr. Jones we pave somewhat higher juices for one article, 
 as this buyer was yet unknow n to us, and as unhappily all American buyers always ask a 
 reduction of three and even five j»er cent, on the juices before handing their order, which 
 makes it imjiossible to the manufacturer to give them at once the ven lowest prices : (for 
 Boyaux we pave him the very same, being in need of orders.) We add that if even the cus- 
 tom-house would not admit this fact, which I declare to be true, there is vet no reason lor 
 seizing our goods, as the taffetas-Boyaux ribbons have been invoiced at exactly the very same 
 juices we allowed to Mr. Jones, and the plain taffetas ribbons only about one per cent, 
 lower, which gives no right to the custom-house to seize the goods. 
 
 We beg leave to state that on high colors cut by teu yards, (instead of twelve yards for 
 ordinary colors,) there is a bonification of eight per cent. This allowauce is always under- 
 stood, and all American buyers are aware of it, so that if they ask our prices they never 
 mention it, as it is understood beforehand. 
 
 Three-fourths of all the ribbons sold for America are high colors; therefore the bonification 
 on the total amount of the invoice is about six per cent., (sometimes five and a half per 
 cent., sometimes six and a half per cent.,) according to the assortment wanted; I therefore 
 deduct on Mr. Jones's prices six per cent, as the general average. 
 
 I also add list of prices invoiced this week to two of our good customers in New York, 
 Elliot C. Cowden and T. K. Jaffray& Co., for orders handed to us in October last, when 
 silks were at least twenty per cent, higher than at the time we invoiced the goods seized by the 
 custom-house, (August and September, 1866.) 
 
 A rise in silks of twenty per cent, is equal to eight per cent, on the manufactured goods. 
 You will see by it that these prices, at which we sold to our American customers after the 
 great rise in silks, are entirely in conformity with our invoice prices previous thereto. We 
 are happy to believe that such facts and statements should satisfy the United States govern- 
 ment and the custom-house of New Y'ork, and finish atonce'all trouble as to our seized goods, 
 and avoid a recurrence of the same for spring importations. 
 Your most obedient servants, 
 
 J. J. BACKOFEN & SONS. 
 
 LIST OF SUITS PENDING IN THE UNITED STATES DISTRICT COURT TO RECOVER DUTIES 
 UPON ALLEGED UNDERVALUATION OF CHAMPAGNE WINE DURING THE PRECEDING FIVE 
 YEARS. 
 
 Suits vs. champagne tcinc, reported to the United States district attorney, August 31, 186* 
 For violation of section G6, act March 2, 1799, and section 1, act March 1, 1863 : 
 
 Frederick De Barry, 25,725 packages, Mumm & Co $165, 000 
 
 A. Oechs, 12,780 packages, Moet & Chandon 125, 000 
 
 Clement Hurdt, 2,420 packages, Duz & Geldemann 36,300 
 
 Marc De Venoge, 7,542 packages, de Venoge 113, 130 
 
 Lalance & Grosjean, 3,935 packages 59,025 
 
 Eenauld Francois & Co., 3,300 packages, Heidsick 495,000 
 
 Bouche Fils & Co., 3,141 packages 47, 115 
 
 Theodore Stehn, 3,205 packages, Eugene Cliquot 48, 075 
 
 Stehn & Wulfing, 6,035 packages, Eugene Cliquot 9,525 
 
 John G. Welsh, 3,455 packages, Charles Fair 51,825 
 
NEW YORK CUSTOM-HOUSE. 
 
 327 
 
 C. F. & H. G. Schmidt, 2,220 packages, Veuve Cliquot $33, 300 
 
 H. G. Schmidt & Co., 2,605 packages, Veuve Cliquot 39, 075 
 
 Herman Batjer, 9,946 packages, San Marcaux 149, 190 
 
 L E. Amsinck & Co., 16,629 packages, Heidsick & Co 100, 000 
 
 T. W. Bayaud & Berard, 7,559 packages, Charles Heidsick 113, 385 
 
 C. F. & H. G. Schmidt, 4,190 packages 62,940 
 
 C. Meletta & Co., 1,162 packages, Euinard Pere et Fils 17,430 
 
 H. Monlun, 742 packages 6, 500 
 
 E. V. Haughwout & Co., 5,904 packages, Prince Imperial 88,560 
 
 Lawrence, Myers & Co., 4,015 packages - 60,225 
 
 1,820,000 
 
 Washington, February 27, 1867. 
 THOMAS McELRATH sworn and examined. 
 
 By Mr. Rollins : 
 Q. Where do you live ? 
 A. In the city of New York. 
 Q. What is your business ? 
 
 A. I am now the appraiser of merchandise under the act of 1866, for the 
 port of New York. 
 
 Q. How long have you been in that department 1 
 
 A. Since the first of September last, when the law went into effect. 
 
 Q. Have there been any seizures of champagne wines since you have been 
 in office 1 
 
 A. Not that I am aware of. 
 
 Q. The seizures were made before you went into office ? 
 A. So I understand. 
 
 Q. Do you know anything about De Barry's champagne case, so called ? 
 
 A. I was general appraiser from 1861 to 1864, and, while I was acting in 
 that capacity, there was an appraisment of Mumm's wines ; De Barry was the 
 consignee. 
 
 Q. How long have you been appraiser for the port of New York ? 
 
 A. I was general appraiser (a different office from what I now hold) from 
 April, 1861, until January, 1864, when I resigned; my resignation was not 
 accepted until they found a successor, which was in April, 1864. 
 
 Q. Please state what you know about these wines consigned to De Barry. 
 
 A. I think in 1861 there was an invoice of wines consigned to De Barry at a 
 less price than they had formerly been invoiced at, and the assistant appraiser 
 advanced them in value. De Barry appealed from the appraisement, and that 
 appeal came before me. On that appeal I subpoenaed the best wine merchants 
 1 knew, and they testified as to the value of these wines The merchant ap- 
 praiser associated with me in my report was Mr. Michael Lienau, a man reputed 
 to be of the highest character, and well acquainted with the foreign values of 
 the different kind of wines. 
 
 Q. What is his business ? 
 
 A. I don't know. I only know him by reputation as a man of high char- 
 acter. 
 
 Q. Do you know whether he is in active business ? 
 
 A. I think he was at that time, and I presume he is now. Mr. De Barry 
 was permitted to make a statement before the merchant appraiser and myself, 
 which he did at the time, and perhaps the appraisement was influenced to some 
 extent by his statement. He said that Mumm & Co., for whom he acted as 
 agent, had, I think, he said, 60,000 dozen baskets of champagne prepared for 
 the American market ; that from the depression in the prices, and from the 
 
328 
 
 XKYV YORK CUSTOM-HOl'SE 
 
 prospects at that time, they wore not likely to dispose of their wines, and they 
 therefore Pelt it a matter of policy on their part to reduce the prices. At th.it 
 time everything was depressed. 
 
 Q. And they consequently had invoiced the wines at a less price? 
 
 A. Yes, sir. 
 
 Q. Do you know the prices at which they had invoiced the wines? 
 A. I do not know. 
 
 Q. Do you remember the prices they were finally invoiced at ? 
 A. No, sir. 
 
 Q. Do you remember the prices at which these wines are now invoiced? 
 A. No, sir, I do not. If I had been at all advised of the information that 
 was desired from me, I could have given the figures. 
 Q. Are wines still consigned to De Barry ? 
 A. Yes, sir, I think so. 
 
 Q. Are you not aware at what prices they are invoiced now? 
 
 A. No, sir; they would never come before me, unless there w;i> a dispute, and 
 it was brought specially before me. 
 
 Q. Do you know at what prices any of these wines are fixed at the custom- 
 house ? 
 
 A. I do not. 
 
 Q. Can you tell at what prices any champagne wine has been entered at the 
 port of New York since you have been c >nnocted with it? 
 
 A. I cannot. I think it varies from fifty francs to thirty-six francs. I do 
 not know what brands, however, pay the highest. I understand that the Cliquot 
 is the best, and the Heidsick stands next, rating higher than Mumm's. It is 
 not a matter with which I would charge my memory, unless it came before me 
 as disputed. 
 
 Q. Have you given us all the information you can in relation to the wines 
 consigned to De Barry ? 
 
 A. That is all I know of it. I knew at the time this matter came before me 
 that it was very difficult to arrive at the foreign value of an article that was only 
 consigned to this market. There are other commercial articles in which we find 
 the same difficulty. 
 
 Q. These wines are consigned to no other house in this country ? 
 
 A. No, sir. 
 
 Q. Was there any seizure made ? 
 A. Not at that time. 
 Q. Has there been any since ? 
 A. I understand so. 
 
 Q. Some of these wines consigned to this same house have been seized ? 
 A. Yes, sir 
 
 Q. To what amount ? 
 
 A. I cannot tell. 
 
 Q. When was this seizure ? 
 
 A. In 1864 or 1865. 
 
 Q. Has the case been adjusted. 
 
 A. I could not tell. I would not know if it had. 
 
 By Mr. Warner : 
 
 Q. In what capacity did you hear and determine this case ? 
 A. I sat as a judicial officer. 
 
 Q. Did you hear testimony on one side and on the other ? 
 A. Yes, sir. 
 
 Q. Did you direct the order of testimony ? 
 
 A. Yes, sir; I examined and cross-examined parties. 
 
 Q. Y"ou say that these particular wines have no foreign valuation ; are these 
 wines not used in Europe ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 329 
 
 A. No, sir. 
 
 Q. Then they make a specific article for this country, and this country only ? 
 A. Yes, sir; and consign it all to one house. 
 
 Q. Then you can only get at the valuation by the cost of manufacture 1 
 A. Yes, sir ; and by comparison with the prices of other wines. 
 Q Did you make any examination to ascertain the condition of the foreign 
 market 1 
 A. Yes, sir. 
 
 Q. How long did that investigation take place ? 
 A. I cannot remember. I thiuk it was about two days. 
 Q. How could you get the foreign valuation in that time 1 
 A. From wine merchants who were acquainted with the market. 
 Q. But were not these parties interested in having the prices fixed as low as 
 possible ? 
 
 A. I do not know as they were. 
 
 Q. Was Mr. Lemo acquainted with foreign valuations ] 
 A. Yes, sir. 
 
 Q. You say that the market was very much depressed at the time you made 
 this reappraisement, and very soon after that it recovered, and the wines in- 
 creased in price ? 
 
 A. Yes, sir 
 
 Q. Did you inquire as to the extent of the product of Mumm & Co., as to 
 whether they produced any more that year or not 1 
 A. I did not. 
 
 Q. Did you examine him or his agents 1 
 
 A. De Barry made a statement. He has a right to make a statement under 
 the law. I think De Barry stated that he had 60,000 baskets of champagne, 
 not the product of that year, but the amount he had on hand. 
 
 Q. You mean to say, then, that there was an actual depression in the market ? 
 
 A. Yes, sir 
 
 By Mr. Broomall : 
 
 Q,. When the market recovered, why were not the wines marked up again ? 
 
 A. I do not know ; I was not in office then. Mr. De Barry showed me a 
 statement, when he was before me giving an account of the cost of the wines, 
 the freight, insurance, commissions, and other expenses, and if his statement 
 was correct — and it appeared to be fair — he made only one dollar a basket on the 
 60,000 baskets. 
 
 Washington, D. C, February — , 1867. 
 ISAAC PHELPS sworn and examined. 
 
 By Mr. Rollins : 
 Q. Where do you live ? 
 A. In New York city. 
 Q. What is your business ? 
 
 A. I am connected with the appraisers' department of the port of New York. 
 Q. What branch of the appraisers' office are you connected with ? 
 A. At this time I have charge of what is known as the second division, which 
 embraces the appraisement of sugar, molasses, and such articles. 
 
 Q. How long have you been connected with the appraisers' department ? 
 A. About twenty-five years. 
 
 Q. Have you had anything to do with the appraisement of champagne wines? 
 
 A. I did have something to do with the appraisement of champagne wines 
 on one special occasion, although it was not connected with my branch of busi- 
 ness. It was some two or three years ago. 
 
330 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. Please give us all the information in your possession in reference to that 
 matter, and under what circumstances you were connected witli it. 
 
 A. My best recollection is that some two yean 100 — I do not recollect the 
 precise time, but it was during the administration of Collector Barney — allega- 
 tions were made against the appraisers in reference to the undervaluation of 
 champagne wines. The charges, I believe, came from the Treasury Depart- 
 ment. There were a number of importations, tie' appraisal of which was pend- 
 ing and undetermined. The appraiser who had charge of that particular branch 
 of goods was also at that time, and is now, the general appraiser, as it is termed, 
 of the port of New York, before whom cases arising under an appeal from local 
 appraisers would, in the usual course of law, be brought before; but he was 
 acting then as the local appraiser, and as it was probable that an appeal would 
 be taken by the importer on the valuation tixed, I took the place 01 the local 
 appraiser. While thus acting 1 received information from the collector's office, 
 in the shape of documents, tending to show that undt aval nations of champagne 
 wines had been made. This information, if I remember aright, was in the shape 
 of price-lists of champagne in the foreign market, and also invoices of wines of 
 direct importation which had been entered in the custom-house, and of which 
 these invoices were duplicates, except as to prices. They had been taken sum- 
 marily from the possession of the importer. These papen were placed in my 
 hands for the purpose of enabling me to form an opinion as to the value of this 
 merchandise. I examined these papers and found either on these invoice-, or 
 on the price-list, or on both, that the prices were at variance with those that 
 these wines had hitherto been placed at. I assumed that these prices were cor- 
 rect, and upon that basis I went to work and appraised a number of invoices 
 for different parties for champagne wines, taking the information that came to 
 me in that way as a starting point, and fixing the prices of other brands by 
 comparison with that. 
 
 Q. Did you advance the valuation ? 
 
 A. Yes, sir, in a good many instances. 
 
 Q. What brands ? 
 
 A. I do not remember now ; I know Heidsick was one ; I think there were 
 two different brands of Heidsick. 
 
 Q. Do you know how much you advanced them ? 
 
 A. I do not ; but it was materially above the prices at which they were en- 
 tered. 
 
 Q. You relied exclusively, in marking the value of these wines, upon the 
 invoices bef >re you ? 
 
 A. Not entirely. We took them as far as they went, but we also used our 
 judgment in testing them and comparing them with other wines. 
 
 Q. Were these papers that were shown you bona fide purchases in Europe, 
 or were they consignments to parties in this country, in which case allowance 
 would have to be made for freight, &c. % 
 
 A. 1 think they were consignments to parties in this country. 
 
 Q. If they were consignments to parties to this country, and freight, insu- 
 rance, commissions, &c, would have to be paid in addition, how could you tell 
 the actual price of the wines ? 
 
 A. We take the value of the wines in the foreign market, and not what they 
 will bring here. 
 
 Q. Under whose direction did you act in this matter ? 
 
 A. We are under the direction of the collector. The collector directs the 
 appraiser to make the appraisement. 
 
 Q. But did you not act under the direction of some particular branch of the 
 collector's office who instigated the proceedings ? 
 
 A. I cannot speak of that of my own knowledge. The impression upon my 
 
NEW YORK CUSTOM-HOUSE. 331 
 
 mind is that these proceedings were instigated by information which came from 
 another quarter. 
 
 Q. From what quarter ? 
 
 A. From the Treasury Department, I think. 
 
 Q. It was information derived from a seizure, was it not ? 
 
 A. I think there was something of the kind connected with it. I think 
 there was a seizure at San Francisco that started the matter at first. 
 
 Q. Did you not receive your orders in this case from the seizure bureau ? 
 
 A. Well, the collector is at the head of the seizure bureau. 
 
 A. Who is in immediate charge of the bureau ? 
 
 Q. Mr. Hanscom. 
 
 Washington, D. C, February 2S, 1867. 
 ROBERT TOMES sworn and examined. 
 
 By the Chairman : 
 Q. State your name and residence. 
 A. Robert Tomes ; I reside in New York city. 
 Q Are you a consular agent of the United States ? 
 A. I was United States consular agent at Reims. 
 Q. How long since ? 
 
 A. I held that position from July, 1865, until November, 1866. 
 
 Q. Were you called upon to certify invoices of champagne while you were 
 there as to the correctness of their valuation ? 
 
 A. Yes, sir, constantly. My chief duty was to legalize invoices— invoices of 
 champagne. 
 
 Q. Please state the principle that controlled your judgment in the performance 
 of this duty. 
 
 A. 1 could rely but very little on my own judgment in the matter. I do 
 not think the best judges of wines in Reims could tell, by the mere taste, their 
 market valuation. It depends entirely upon the demand and the fancies of the 
 consumers. 
 
 Q. How did you arrive at the valuation ? 
 
 A. I had to take it on trust. I could not go out and say, " Here is wine of 
 such and such brand; what will it sell for?" because there was no market value 
 for it. For instance, you cannot go to Reims and buy a dozen bottles or fifty 
 dozen bottles of Clicquot wines. It is not sold there ; I could not even get it 
 at the hotels there. 
 
 Q. Why is it not sold there? 
 
 A. I cannot tell. It was probably to create an artificial mysticism about its 
 manufacture. All the champagne trade is carried on through agencies. A 
 wine has a reputation in one country and no reputation in another. The Clic- 
 quot is almost exclusively used in Russia, and they are indifferent to any other 
 trade. I am told that it is not sold in France except at Grande Hotel and 
 Hotel de Rue. 
 
 Q. What is the data upon which you finally certified to the valuation ? 
 
 A. I took it mostly on trust — on the statement of the manufacturer. I was 
 not in the habit of testing the wines or demanding samples. I had no right to de- 
 mand samples. 
 
 Q. In the declaration of the manufacturer, then, he gave you data to show the 
 correctness of his declaration ? 
 
 A. No; he generally made a round statement, giving in the office the prices 
 he declared it at. 
 
 Q. How does the manufacturer get at the value ? 
 
332 XKYV YORK CUBTOM-HOUSfl. 
 
 A. Whenever I asked thorn how they made out their valuation, they told me 
 that they added to the cost of the article a certain sum for probable profit; 1 hat 
 is over and above the actual cost of the article. While consul, I wis Appointed 
 commissioner to take testimony relative to the rating of these champagne wines. 
 
 Q. I>v whom were you appointed? 
 
 A. By the di.-trict court in New York. In the course of that testimony — in 
 the case of De St. Marcoaux & Co. — they declared that they never received 
 from the United States or the continent of Europe for his wines a Sam beyond 
 the net amount of his declaration. He showed me his books and I found it 
 was a fact. 
 
 By Mr. BfiOOMALL : 
 Q. Did he find that he had actually sold the wine ? 
 A. Yes, sir. 
 
 By the Chairman : 
 Q. Was this another kind of wine? 
 
 A. The wine they sell varies. For instance: in England they prefer a dry 
 wine, and to make a dry wine it is necessary to be old and of the very beef 
 quality. Jn making champagne they use a certain liqueur, and it' the wine is 
 not very good they can disguise the taste of it by this liqueur. In Fiance and 
 America the taste is for a sweet wine. I have the testimony of brokers to the 
 effect that the wine sent to the United States, although a wholesome one, is of 
 an inferior and cheaper quality. 
 
 Q. Who gave you your instructions in reference to the valuation of these 
 wines ? 
 
 A. I received a copy of the instructions issued to consular officers. I received 
 no special instructions. 
 
 Q. Were you at any time visited while you were there by Mr. Bigelow, or 
 any officers of the United States ? 
 
 A. I was not visited by Mr. Bigelow, but Mr. Nicolay and Mr. Hay visited 
 me as personal friends, and not in reference to this case. 
 
 By Mr. Rollins : 
 
 Q. Did you have any correspondence with him ? 
 
 A. Y/es, sir ; I had correspondence with him on the subject, which he trans- 
 mitted to the State Department, or at least he so informed me. 
 
 By the Chairman : 
 
 Q. Were you engaged in any other business while you were there ? 
 A. No, sir. 
 
 Q. What country are you a native of ? 
 A. I was born in the city of New Y/ork. 
 
 Q. Did you go from New Y/ork to Reims on receiving your appointment ? 
 
 A. I went abroad to spend a year or so, and Mr. Bigelow said I should go to 
 Reims as consul. He said I could make myself useful there, and I would 
 find it a very agreeable place to live in. 
 
 Q. Were you in commercial business in New York before you left ? 
 
 A. No, sir. 
 
 Q. Who is consul at Reims now ? 
 A. Mr. Morrissy. 
 
 Q. Are you connected with any commercial house ? 
 
 A. No, sir. The only thing I ever did that ever approached to a commercial 
 transaction was to purchase a small lot of champagne for some friends in New 
 York connected with the Union Club. They wrote me when I was there, and I 
 purchased it for them as a personal favor. 
 
NEW YORK CUSTOM-HOUSE. 
 
 333 
 
 Q. You knew when you entered upon your duties that there had been seiz- 
 ures of wines on account of undervaluation ? 
 A. Yes, sir. 
 
 Q. Have the wines been invoiced higher since then 1 
 
 A. I think not, but very little, and in those cases under protest. They put 
 it on to avoid seizure, protesting at the same time that their profits were not 
 greater. 
 
 Q. Knowing that these seizures were made, and holding the official position 
 you did, what particular steps did you take to ascertain the value of the wines ? 
 
 A. I always asked them upon what basis they made their valuation. I re- 
 ceived universally the answer that it was the cost of manufacture, upon which a 
 percentage had been added for probable profit. 
 
 Q. Then you continued invoicing at the same price after the seizure ? 
 
 A. Yes, sir ; when they came to ask me to approve their invoices I asked 
 them how they arrived at their figures. They invariably answered me as I 
 have already said. They said that was the price they would be willing to sell 
 it at. 
 
 By Mr. Broomall : 
 Q. Did you ever test their willingness to sell it ? 
 
 A. No, sir; they will only sell it through their agents, who have a monopoly 
 of it ; these agents receive large commissions and have a complete monopoly for 
 the sale of the particular brand. 
 
 Q. Do you recollect the prices at which these wines were invoiced ? 
 
 A. I can recall some of them ; I think that Piper & Co.'s Heidsick, who ex- 
 port the largest to the United States, is invoiced generally at thirty-six francs, I 
 think. 
 
 Q. That was when you were there? 
 
 A. Yes, sir ; but I don't think they have changed it since. 
 Q. Do you know the prices of Roederer & Co. ? 
 
 A. He* invoiced his most expensive wine at sixty-three francs, and his cheaper 
 wine at, thirty-eight francs. The Schreider wine is the cheap wine. 
 
 Q. What were the character of the principal houses engaged in shipping to 
 the United States ? 
 
 A. The principal exporters of wines' to the United States are H. Piper & 
 Co., known here as Heidsick; Heidsick & Co., which is a different house ; G-. 
 H. Mumm & Co., Jules Mumm & Co., De St. Marceaux & Co., Veuve Clicquot, 
 Von Moet & Chandon, and Roederer. These are the principal exporters to the 
 United States. There are two or three other houses, but they do a very small 
 business. These firms are composed of men of the highest character for integ- 
 rity ; several of them are in public position ; De St. Marceaux is judge of the 
 tribunal of commerce, and no other man in Reims is more highly esteemed. 
 The principal of the house of Clicquot is mayor of Reims and a member 
 of the corps de legislatif. 
 
 Washington, March 1, 1867. 
 
 JOHN BIGELOW sworn and examined. 
 
 By Mr. Rollins : 
 Q. Where do you reside ? 
 
 A. Highland Falls, Orange county, New York. 
 
 Q. What position did you occupy prior to your appointment as minister to 
 France 1 
 
 A. Consul at Paris, from 1861 until 1865. 
 
334 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. PleaW State whether, under the laws of the United States and instruc- 
 tions WBUed from the State Department, you wen- required to satisfy yourself as to 
 the correctness of invoices of merchandise intended to be shipped to the United 
 States presented to you for your certificate ? 
 
 A. Yes; I understood the law to require that, when these invoices were pre- 
 sented for certificate. 
 
 Q. Did you, in fact, make investigations to ascertain whether the valuation 
 was correct or not ? 
 
 A. I did not, in fact, make any personal investigation. My clerks were 
 authorized, whenever they saw anything suspicious, to make such inquiries as 
 seemed to be necessary. 
 
 Q. Did you not make any inquiry in regard to the price of commodities ? 
 
 A. Not generally, unless I had special grounds for suspicion. 
 
 Q. You took the representations of the merchants? 
 
 A. l T es, usually. 
 
 Q. Did you, at any time while you were in office, certify to the valuation of 
 merchandise as correct, which you had reason to believe was incorrect? 
 
 A. I never knew this positively in reference to any invoices I ascertained 
 that there was a practice of declaring goods there at a lower valuation than I 
 supposed them to be worth, but I never, in any instance, passed anything that 
 I knew at the time was fraudulent, for the reason that I never examined it at 
 the time of passing it. 
 
 Q. In passing these invoices you supposed the price named in the invoice to 
 be lower than the real value ? 
 
 A. In reference to champagne, I supposed them to have been invoiced too 
 low. Without possessing legal proof of the fact, that was my impression dur- 
 ing the latter part of my consulate. 
 
 Q. Was the consular agent of the United States at Reims within your su- 
 pervision and control ? 
 
 A. l'es, sir. 
 
 Q. Was he subject to direction from you ? 
 A. Yes. 
 
 Q. How was it about invoices certified to at Reims ? 
 
 A. The champagne invoices were all certified at Reims, or substantially all. 
 There were only occasionally small shipments from Paris. 
 Q. Then your remark applies to Reims and Paris also ? 
 A. Yes, to the whole champagne district. 
 
 Q. If you believed those invoices were really too low, ought you not to have 
 taken some steps to have ascertained the real value ? 
 A. l>s, I did. 
 
 Q. At what time did you take these steps ? 
 
 A. As soon as my suspicions were awakened upon the subject, I took some 
 measures to ascertain the value. 
 
 Q. Did you ever visit Reims for the purpose of ascertaining facts in refer- 
 ence to this custom of undervaluation ] 
 
 A. No, not exactly. I went there once and spent a night. I went out with 
 Mr. Gibbs, the revenue agent of Europe, and a man who was in his employ. 
 
 Q. Do you recollect the name of the man 1 
 
 A. His name was Edward Leuchtenrath. I went out to see the consular 
 agent, and just take a look at Reims. I had no particular purpose. Mr. Gibbs 
 was engaged in collecting testimony, and I went out by his request. 
 
 Q. Was this visit in your official capacity] 
 
 A. No; scarcely. I was an officer, and went out and called upon the con- 
 sular agent, but there was nothing official about it. It was to see how things 
 looked, and see a little about the wine there; for I foresaw that it might be 
 necessary that I should examine the ground, and I wanted to look at my agent. 
 
NEW YORK CUSTOM-HOOSE. 
 
 335 
 
 1 had never seen him. He was there when I came in, and I left him there. I 
 was informed by Mr. Gibbs of some things which led me to suppose there 
 was fraudulent undervaluation of wine. I had no proofs myself. He pro- 
 fessed to have some, and being specially charged by the government with the 
 investigation of this question, and being perfectly a competent man profession- 
 ally and otherwise for such an investigation, and having, as I supposed, special 
 interest in making it, I left the matter entirely in his hands. 1 went out with 
 him, however, simply because he wanted me to go out. 
 
 Q. Did you take any steps to ascertain whether the importers were making 
 correct representations in regard to the valuation of their wines 1 
 
 A. I did not myself take any steps, because there was a man expressly em- 
 ployed for that purpose, and I knew that it required a man to devote his whole 
 time to the matter. 
 
 Q. Did you, during this trip, visit any other places besides Reims ? 
 
 A. None. 
 
 Q. Did you visit any of the champagne houses at Reims ? 
 
 A. I did ; one house. 
 
 Q. Did you make any inquiries there? 
 
 A. No ; I do not think they knew I was consul ever. 
 
 Q. Did you receive any information in reference to the matter 1 
 
 A. I did what we all did, simply go there and see how the wine was stored, 
 and how it was bottled, just as any traveller would. 
 
 Q. Did you receive any information as to the bases on which the invoices were 
 made up ? 
 
 A. No ; I did not see the head of the house at all, I think. My impression 
 is I only saw some of his subordinates. 
 
 Q. Did you have an interview with the consular agent Belin, at Reims ? 
 
 A. I did. I went and called upon him, and spent a few minutes with him. 
 I asked him a question about the mode of doing business, and whether he thought 
 the wines were not undervalued. He replied no ; that they were estimated 
 according to a principle which had been always recognized there as a correct 
 one by all previous administrations; that it seemed to be a universal principle. 
 
 Q. Did he satisfy you that the valuation was correct ? 
 
 A. No, he did not. He satisfied me that he was honest about it — that he 
 thought it was the way it ought to be done. I did not attach any particular 
 importance to what he said about it, because I took a different view of it my- 
 self. 
 
 Q. Did you communicate to him your views in reference to the invoices, or 
 instruct him that the old valuation was too low ? 
 
 A. No, except in the manner I asked the question I have mentioned. He 
 might probably have inferred my opinion from the form of my question. 
 
 Q. Did you give him any instructions as to his conduct with reference to 
 future invoices ? 
 
 A. No. 
 
 Q. Did you instruct him in future not to certify to invoices unless the valua- 
 tion was higher ? 
 
 A. I gave him no instructions whatever. My reason for not doing so was 
 that il was too early in the preparation of the testimony to alarm these parties. 
 I thought it had better be delayed ; that I had better not give him any instruc- 
 tions about it, for if they knew I had been out there looking into the matter, it 
 would break up the measures that had been taken for obtaining testimony that 
 would lead to the conviction of parties which Mr. Gibbs thought was important. 
 These are the reasons why I did not suggest to him a refusal to certify invoices 
 at the old valuation. I had no evidence myself ; I could not have convicted 
 them of anything. I could not have contested their valuation even. That was 
 simply what Mr. Gibbs said he was engaged upon, and what he expected to 
 accomplish. 
 
336 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. You believed the invoices were too low ? 
 
 A. 1 believed it on bis representat ion. He told me be bad proof. My opin- 
 ion was, of course, based upon bis testimony. 
 
 Q. Did subsequent events convince you tbat be was correct? 
 
 A. I have never seen bis proofs. I understand tbe proofs bave been sus- 
 tained by tbe courts. 
 
 Q. "What is the character of these houses in Reims, shipping wines to America ? 
 
 A. The position of the beads of the houses are very respectable. One of them 
 is or was mayor of Reims, and is also a member of tbe corps legislatif, and an 
 eminently respectable man ; the other houses are recognized in France as of the 
 highest character. 
 
 Q. Who is Montgomery Gibbs? 
 
 A. Tbat is a question which ought more properly to be addressed to the 
 Treasury I )epartment. 
 
 Q. "What do you know of him? 
 
 A. Mr. (iilibs came to Paris in 1*03, I think. He brought to me a letter 
 from the Secretary of State stating that he was an agent of the Treasury, and 
 requesting me to co-operate with him in tin.' discharge of his duties — .just a 
 formal letter; and he brought me also a letter from the Secretary of the Trea- 
 sury. I am not sure that he delivered it to me or whether it was not a cir- 
 cular letter which he merely showed. At any rate he came accredited to me 
 as a revenue agent for Europe under an act of Congress which he claimed to 
 bave drawn. That was the first I ever saw or heard of him, although he told 
 me he had been practicing law in the city of New York, and had been occupied 
 a great deal in revenue cases, in the course of which he had become familiar 
 with the necessities of the government alaoad. He said he had also drawn up 
 a bill providing for a triplicate invoice system, by which facilities for the detec- 
 tion and conviction of fraudulent valuations were increased. It became my duty 
 to put that law into operation, and of course I consulted him about the objects 
 of it, and the uses to which he intended it to be put. I saw tbat the intention 
 of Congress was to suppress frauds of that description, and I could see that in 
 having an invoice at Paris and another in New York, tbe means of detection 
 and conviction might be increased; and, as there was an agent there to take 
 these invoices when they were brought to tbe consul, and go out into the mar- 
 ket among experts and find whether the valuation was correct, might be the 
 means, in any cases where there was suspici m of fraud, of detecting it. I en- 
 tirely approved of the object, and I was very glad to bave Mr. Gibbs there to 
 carry it out, because it was quite impossible for tbe consul to do it. It would 
 be entirely impossible for a consul to carry on these investigations. In the 
 first place, his official character makes him a suspected person the moment he 
 goes anywhere in pursuit of such information, and if he were to go out of his 
 office to make them be would accomplish nothing; besides that, he has not the 
 time to do it. 
 
 Q. Is Mr. Gibbs located in Paris? 
 
 A. He spent a long time in Paris. 
 
 Q. Was that the best port from which to make this investigation ? 
 A. Yes, for a certain large class of frauds. 
 
 Q. You stated, did you not, that the bulk of these champagne wines were 
 shipped from Reims ? 
 
 A. Yes ; but the invoices are sent down to the consul at Paris every quarter, 
 or oftener if required. With regard to that the rate of valuation was uniform, 
 I believe, with pretty much all the houses. 
 
 Q. Is there any price or what is called home valuation of these wines in 
 France 1 Are they sold there ? 
 
 A. They tell me not. I never made specific inquiries. I thought of trying 
 to buy some wines on the spot; but having other things to attend to, and Mr. 
 
NEW YORK CUSTOM-HOUSE. 
 
 337 
 
 Gibbs being occupied with this subject, I neglected to do it. That was his 
 business, and he had better testimony relative to it than I could possibly get. 
 Q. Did you go to Reims at his suggestion? 
 
 A. Yes. He said I had never been there, and that I ought to go and look 
 about. I went merely for a trip and to see the place. I do not know what he 
 may have done on that occasion, for he remained behind after I returned. 
 
 Q. Did you know Edward Leuchtenrath ? 
 
 A. No ; I knew nothing about him before this. 
 
 Q. Had he any official character ? 
 
 A. No ; he was used by Mr. Gibbs as a sort of stool pigeon. He opened a 
 little office and professed to do the business of a commission merchant. As 
 such he would order wines and get the bills by which the difference in the 
 prices charged there and the prices in their invoices became apparent. 
 
 Q. Had he any position in Paris as a merchant 1 
 
 A. I think not. He had been a man in business ; so Mr. Gibbs told me. 
 Q. Do you know in what kind of business 1 
 
 A. No, I do not. When he was employed by Mr. Gibbs he was broken 
 down. He had not succeeded in his business, and was ready to take almost 
 anything. I never knew, much of him. Mr. Gibbs brought him there and in- 
 troduced him to me once, but I never saw much of him. 
 
 Q. After you returned to Paris, on this occasion, did you continue to certify 
 to these invoices at the same low valuation 1 
 
 A. Yes; I never gave any directions interfering with the discretion of the 
 consular agent during my consulate, except as I told you, by the question I 
 addressed to him, which might perhaps have led him to suppose that I doubted 
 whether they, were not valuing them too low. 
 
 Q. A large amount of wines were seized in the port of New York in Septem- 
 ber, 1864, on the invoices which were dated April or May previous. State what 
 you know about these seizures. 
 
 A. Nothing. I read in the newspapers that there were seizures. Mr. Gibbs 
 told me there were seizures. I never knew anything about it at all. 
 
 Q. Were these invoices certified to by you ? 
 
 A. I know nothing about it. I take it for granted they must have been. I 
 will explain to you in a word about that certifying of invoices. We used some 
 times to have from 100 to 150 invoices brought in there in the course of a day. 
 I had one clerk whose business it was to sit at the desk from the time he came 
 in the morning until the office closed at night, and on the day before the steamer 
 sailed he did nothing but receive and enter these invocices. Just as fast as they 
 came in they were passed. I never saw a customer; I never passed an invoice 
 or entered one in my life. I should not know how to do it if you were to ask 
 me. This clerk does the whole thing. 
 
 Q. All you did was to sign them 1 
 
 A. I signed a batch of 400 or 500 of these invoices at a time, as they were 
 given to me by my first clerk, who was vice-consul, and he issued them. 
 
 Q. I understood you in your former testimony to state that the first informa- 
 tion you had that these wines were invoiced too low came from Mr. Gibbs. At 
 about what time was that 1 
 
 A. I could not fix the date. It was a few months after he came out to Paris. 
 
 Q. Was it before or near the time of your visit to Reims ? 
 
 A. It was about that time. 
 
 Q. If you thought these wines were invoiced too low, why did you yourself 
 certify to the invoices or allow the vice-consul to certify to them ? 
 
 A. I will tell you. In the first place, as I stated, I had no legal proof of the 
 fraud. In the second place, there was a person there representing the govern- 
 ment for the purpose of procuring proof in these matters, and having the interest 
 of the treasury specially in charge. He said that if I interfered, that if I were 
 H. Rep. Com. 30 22 
 
338 
 
 NEW YORK CU8TOM-HOU8E. 
 
 to undertake to determine what should he regarded as proper valuation, it would 
 prevent the collection of the testimony which was nol yet com] h-t ed ; that lie 
 was in the way of gettil g testimony enough to insure conviction; that if the 
 
 thing was done too soon it would alarm these parties and prevent the securing 
 of the pro f he desired. Then, in tlie third place, I reported to the Secretary 
 of State all these facts — my grounds of suspicion, my conviction in regard to 
 what the facts were — and 1 reported that on the strength of my faith in the evi- 
 dence which Mr. (iihbs said he had or would get* 
 Q. Was that evidence submitted to you at all t 
 
 A. I do not think it was ever submitted to me ; hut 1 never hesitated a mo- 
 ment to believe what he said. 1 never knew him before lie came there with 
 credentials from the State and Treasury Departments, and of course I was 
 hound to believe what he said, and expected him to believe what 1 said. I 
 stated to the State Department that Mr. (iihbs was collecting testimony ; that 
 he intimated that it would be to the prejudice of the interests of the government 
 if I were to undertake to regulate the rate of valuation at present; that I felt 
 embarrassed at continuing to certify invoices with this suspicion resting -OB my 
 mind, as it did on the mind of Mr. (iihbs, that they were fraudulently estimated. 
 
 (,). Was this communication to the State Department, of w hich you speak, 
 dated January 22, 1SG4 t 
 
 A. I presume so. 1 never sent hut one communication on the subject. 
 
 Q. Did it contain this paragraph : '-lam unwilling, without the formal ap- 
 ] nival of the department) to continue to sign invoices of merchandise i hich 1 
 am satisiied are undervalued. Nor would it b< come a government! like ours, hy 
 
 lob.rating, to encourage a system of fraud, from which some of its officers may 
 derive large pecuniary advantage, a moment longer than is necessary to provide 
 for their detection by adequate safeguard against the repetition ?'•' 
 A. Yes, that is my language. 
 
 Q. During this time, while you were certifying to these invoices, did you 
 know that it was proposed to make these seizures in this country, of champagne 
 wines, and that Mr. Gibbs was obtaining evidence for that purpose f 
 
 A. I supposed, of course, he was obtaining evidence for the purpose of stop- 
 ping the fraud in whatever way the department should direct. Of course there 
 was no object in getting this information, unless they were going to stop it. 
 
 Q. Did you in this communication, or in any other communication to the 
 department, report the information you had obtained in respect to the theory on 
 which champagne wines were invoiced, and upon which they made up their 
 invoices ? 
 
 A. I never wrote on that subject, except in the communication referred to. 
 I do not remember whether I explained it ; 1 think it probable I did ; I have 
 no recollection about it. I did communicate to the State Department a sort of 
 memoir, which was given to me by Mr. Werte, the mayor of Reims, to whom 
 I have referred. He was very much worried at being placed in the condition 
 of a swindler and a smuggler, and, as 1 very frequently met him in official 
 circles* 1 advised him to put the case of the wine exporters in the form of a 
 memoir and send it to me, and I would see that it was communicated to our 
 government. I said I could not undertake to present their case myself, for 
 that was not my province ; but it should be read, if he would put it in that 
 form. He gave me the communication, and I sent it to Mr. Seward. 
 
 Q. Do you recollect the date ? 
 
 A. 1 think it was sent shortly after Mr. Lincoln's death. I remember that 
 I was- overwhelmed with business, and that it was neglected for a little time. 
 I should say it was forwarded some time between May and August, 1865; it 
 was alter these wines were seized, and when these people were smarting under 
 the seizure. 
 
 Q. When you made the communication to which you have alluded, did you 
 
NEW YORK CUSTOM-HOUSE. 
 
 339 
 
 then believe that the theory of the merchants was a mistaken one, or did you 
 believe they were correct ? 
 
 A. I believed they were incorrect. 
 
 Q. You then thought they were invoicing these wines too low % 
 A. Yes, sir. 
 
 By Mr. Broom all : 
 Q. Did you receive any instructions from Washington in consequence of the 
 letter alluded to 1 
 A. Never. 
 
 Q. Then you never changed your plan 1 
 
 A. I said in that communication that I should await instructions upon that 
 point. 
 
 By Mr. Rollins : 
 
 Q. Did not the course you adopted in continuing to certify these invoices 
 have the tendency to mislead the merchants and make them believe they were 
 right in continuing the practice ? 
 
 A. I did not adopt that course. If I had adopted it, I would have said it 
 would. I simply did not change anything. It was a practice that had been 
 adopted from the commencement of the tariff law under which I was acting. 
 You will find in the correspondence of the State Department complaints made 
 by the previous consul upon that subject; that he said they were undervalued ;; 
 but the government never took any notice of it, and nothing was done practi- 
 cally to remedy it. The practice had grown up to be a sort Af common, law 
 justification of these merchants. That was the reason that I did not feel that I 
 ought to take any other course without some evidence that the government 
 took the same view of the matter that I did. 
 
 Q. When you came to the conclusion that these invoices were too low, would 
 you have refused to have certified them if a government agent had not prepared 
 and taken charge of the matter ] 
 
 A. If 1 had evidence of it — if I had anything which would justify me in 
 going to the department with it, I should. 
 
 Q. If you had evidence in your possession that would convict that the wines 
 were invoiced too low, then you would have considered the good of the public, 
 and have insisted upon a higher valuation '\ 
 
 A. I should have considered it my duty but for this fact: that it was a sort 
 of usage that several administrations had approved of ; and it would be folly 
 for me to have undertaken to have exacted a higher standard than the depart- 
 ment at home would sustain, for it would only make discontent, and ultimately 
 amount to nothing. I did try some things of this sort, but they were not sus- 
 tained by the Treasury. 
 
 Q. Do you know the late consular agent at Reims, Mr. Tomes ? 
 
 A. I know him. 
 
 Q. Was he appointed on your recommendation ? 
 
 A. He was. I did not appoint him. Mr. Tuck was at that time vice-consul 
 and acting consul. I had then become charge or minister. Mr. Tuck was iu 
 great trouble. The consular agent there had died, and he did not know of any 
 one he could appoint, who was a proper person, at that time. Dr. Tomes was 
 in Paris. He had a restricted income, and wanted to live somewhere and per- 
 fect his French. He had been an old class-mate of mine in college, and I told 
 Mr. Tuck he could not do better than to take him. 
 
 Q. Did you have any correspondence in reference to his business ? 
 
 A. He wrote to me two or three times. I wrote him once. I do not know 
 whether I ever did more than once, and what I wrote I cannot now say. 
 
 Q. Do you recollect what he said, in his communication to you in reference to 
 invoices of wines sent from Reims 1 
 
340 
 
 NEW YOB K CUSTOM-HOUSE. 
 
 A. No, I do not remember accurately, except that lie thought the merchant! 
 
 were very badly Used there. I did not attach a great deal of* importance to 
 what he said. I felt that I knew the subject better than he did. had never 
 had occasion to investigate the matter, and living among them, it was very nat- 
 ural that lie should lake different views. They all thought they had been 
 dreadfully misused by the government of the United States, and I think he wafl 
 of tin; impression that our government agents had been unreasonably severe on 
 the champagne exporters. 
 
 Q. Did he represent that their invoices were all right ? 
 
 A. I do not think he did. He merely spoke of these seizures, and what they 
 represented to him in reference to them. 
 
 Q. Did he represent that there was no ground for seizure? 
 
 A. He rather reflected their representation that there was no ground, and he 
 appeared to believe it. He rather made himself an intermediary of their com- 
 munications than an organ for the expression of his own opinions 
 
 Q. Did you forward his communication to the Secretary of State? 
 
 A. I do not remember; I do not much think I did. If he requested it, I 
 may have done so. 
 
 By the CHAIRMAN : 
 
 Q. State whether it had come to your knowledge, and, if so, when and 
 where, that Mr. Far Well and Mr. (i.bbs had been allowed or had claimed the 
 informer's share in the seizures made in this country. 
 
 A. 1 never knew it nor heard of it until I saw it in the testimony contained 
 in a document which I picked up in the office of the Sergeaut-at-arms a few 
 minutes since. 
 
 In House, March 2, 1867. 
 
 Hon. Senator Fogg, 
 
 Sir : You ken and knew of Montgomery Gibbs, in Europe, during the years 
 1861 to 1865, inclusive; what was his reputation there during that period? 
 
 Answer. 
 
 From what I knew of him, saw of h : m, and heard of him and of his opera- 
 tions in Europe, I formed the deliberate opinion that he was a dishonest man, 
 and utterly unworthy to hold any position of honor, profit, or trust under the 
 United States government. 
 
 GEO. G. FOGG. 
 
 Hon. Calvin T. Hulburd. 
 
 Astor House, N. Y., January 30, 1867. 
 
 CHARLES P. CLINCH, deputy collector, being duly sworn, testified as 
 follows : 
 
 Examined by Mr. Hurlburd : 
 
 Q. How long have you held the office of assistant collector ? 
 A. Since the 17th March, 1S63. 
 
 Q. What was your previous position in the custom-house ? 
 
 A. Deputy collector. 
 
 Q. How long have you held that office ? 
 
 A. Since 1839. 
 
 Q. Were you connected with the office before ? 
 A. Y"es, sir ; I was appointed an inspector in 1838. 
 Q. What bureau were you the head of after 1839 ? 
 
NEW YORK CUSTOM-HOUSE. 
 
 341 
 
 A. We did not divide the business of the office until 1S55. We were all co- 
 ordinate in fact ; every one of the deputies attended to the same business. It 
 was Mr. Guthrie's plan — after the plan of the Treasury Department ; he di- 
 vided it into bureaus. 
 
 Q. As assistant collector, briefly indicate your duties. 
 
 A. I think I have furnished you a printed statement which begins by saying, 
 "The assistant collector shall exercise the same powers as the collector." Then 
 it goes on to define certain duties, such as the correspondence of three several 
 divisions. 
 
 Q. Have you been called upon to act in the place of or as collector'? and if 
 so, when 1 
 
 A. I acted constantly. My duties were necessarily the duties of the collector. 
 If I was not there he would do what I did. From the 13th of November, 1865, 
 to the 13th of May, 1866, I think it was. 
 
 Q. You acted as collector ? 
 
 A. Yes, sir ; under the twenty-second section of the act of 1839, as special 
 deputy. 
 
 Q. During that time the business of the seizure bureau necessarily was 
 brought to your attention? 
 
 A. The results uf their examination was brought to my attention to the ex- 
 tent of showing me their views ; when they advised a seizure was proper, my 
 judgment would concur in it if carried out. 
 
 Q. Have you had your attention directed to that subject specially or gener- 
 ally, any length of time previous thereto ? 
 
 A. Not at all ; not at any time. 
 
 Q. From your knowledge of its working, what is your opinion of it, or of 
 that system as a prevention of frauds on the revenue — I will say, smuggling 
 and frauds on the revenue? . 
 
 A. As I am of opinion that the heart is deceitful above all things, and des- 
 perately wicked, I do not. believe it is any preventive at all. 
 
 Q. I ask you as a person long connected with the custom-house, where is the 
 statutory warrant under which the seizure bureau make compromises ? 
 
 A. I presume that they get authorization from the statutory provision re- 
 quiring the collector to report to the department all his receipts, including com- 
 promises. 
 
 Q. Do you recollect the date of that % 
 
 A. I do not ; I will send it up. Probably they have also a large margin in 
 their own discretion, in the discharge of their duty as protecting the revenue. 
 
 [Custom-House, New York, Collector's Office, 
 
 January 30, 1367. 
 
 Dear Sir : The statutes to which I referred, in which the word compromise is used, are 
 chapter 346, act of 3d of March, 1841, section 5 ; aud section 10 of the act to preveut frauds 
 on the revenue, approved March 3, 1863. 
 I am, yours, very respectfully, 
 
 C. P. CLINCH, Asst Coll. 
 
 Hon. C. T. Hclbfrd, Astor House.'] 
 
 Q. What would be in your judgment a better remedy for these frauds on the 
 government, if you know of any that could be adopted ] 
 
 A. The utter and total abolition of ad valorem duties, and specilic duties in 
 place. 
 
 Q. What is the effect of allowing the collector, the surveyor, and the naval 
 officer, to receive a share of the forfeiture, fine, or penalty, arising from the de- 
 'tection of frauds on the revenue 1 
 
 A. Supposing all their proceedings in the way of seizures to be legitimate 
 and properly founded, it is of the greatest possible service to the safety of the 
 revenue. 
 
342 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. What would be the effect, then, in giving the amount distributed to these 
 three officer! now enumerated, to their subordinates or tin- inspectors who actu- 
 ally watch imd give the information ? 
 
 A. There ia do Bitch ease except in the smuggling business Prom oa board of 
 ships in baggage, &c. 
 
 Q. To your knowledge, can tlx- report of seizure cape* he delayed by the 
 seizure bureau from being reported to the collector 1 Can the bead of the 
 seizure bureau hold onto his reports ; and is it optional with him when he shall 
 report to the collector J 
 
 A. It must necessarily be ; because he is the only possessor of the existing 
 Btate of tacts. The collector know s nothing about its progress — I suppose so — 
 unless he goes and looks at it every day in person. We never con.-idored that 
 the business of the office. 
 
 ( w >. Dave there been any cases of alleged or otherwise withholding reports of 
 seizure cases upon the eve of the new collector coming in I 
 
 A. No; 1 know nothing to m\ knowledge of any such thing. I have heard 
 a rumor that Mr. Barney was specially anxious to have everything g »t up pre- 
 vious to his going out. 
 
 I )o you consider the manner in which the seizure bureau is conducted a 
 fair and proper one for the government F 
 
 A. As far as I know it is, and as far as my judgment and conviction go of 
 the ability tin re possessed, I do not heir ve it could be better conducted. 
 
 Q. Can you make any BUggestion with reference to correcting abuses in the 
 collection of the revenue ? 
 
 A. To keep clear of the system of collecting it with the aid of a microscope, 
 in the way of enumeration of threads and fractions of inches. 
 
 Q. Anything else that occurs to you ? 
 
 A. No. 1 was going to say that I am an entire sceptic as regards the charges 
 of delinquency or malfeasance on the part of any of the custom-house officers; ; 
 I uever saw it, and could not put my finger on an instance. 
 
 Washington, D, C, February, 1867. 
 HENRY A. SMYTH E recalled and examined. 
 By the Chairmax : 
 
 Q. You are recalled before the committee for the purpose of stating the par- 
 ticulars of your having received or obtained copies of testimony taken before 
 tliis committee here or in New York. Please state the circumstances, iu detail ? 
 
 A. A woman called upon me very soon after I appeared before you the first 
 time, at the custom-house, whom I declined to see until she said she had business 
 of importance with me. She then said that she could furnish me with a copy 
 of the evidence, entire, taken before this committee for the sum of two hundred 
 dollars, which I declined. I stated the met to Mr. Hulburd, and I think Mr. 
 Hulburd expressed a doubt as to my being able to obtain it. 
 
 Q. Did she say who she was ? 
 
 A. She said she was from Brooklyn. She did not give me her name. 
 Q. What followed after that % 
 
 A. She left. Some time afterwards, I heard incidentally from others that the 
 testimony had been seen, and that 1 could see it if I wished to. Then I was 
 told that there was some of the evidence that bore so directly upon me that J 
 was foolish not to investigate it and contradict it. I then told this woman, w r ho 
 called again, that if there was any of that evidence that interested me specially, 
 which was very blackening to my character, I should like to see it, and that I 
 
NEW YORK CUSTOM-HOUSE. 
 
 343 
 
 would pay for that part of it; that I did not wish the whole of it. If there 
 was anything beating upon me very badly, I knew it was placed there in 
 malice, and I should Lke to see it for the purpose of refuting it. 
 Q. Did you ask her to call again ? 
 
 A. Xo, sir. The first time she offered me an entire copy for $200, and the 
 second time she offered a part of it. 
 
 Q. How long after the first interview was the second ? 
 
 A. I should think three weeks. I think she declined to give me her name; 
 but said she was authorized to come there. 
 Q. Who did she say authorized her? 
 
 A. She did not say. I do not remember whether I asked her or not. 
 
 Q. What means did she say she had of obtaining the testimony? 
 
 A. She said she was sent there. I rather avoided the matter in the first 
 place, but others told me that if there was any of the evidence reflecting upon 
 me personally I ought to get hold of it. 
 
 By Mr. Broomall: 
 Q. This was the second interview with the womau. What then followed i 
 A. A man then called in the same mysterious way. and would not. see any- 
 body but myself. I went out. He stood there, handed me a parcel and said 
 there was the evidence. I paid him the money and took it. 
 
 By Mr. Rollixs : 
 Q. Who was that man? 
 
 A. I do not know. I have never seen him before or since. 
 Q. Was this at the custom-house? 
 A. Yes, sir. 
 
 Q. What price did you pay for it ? 
 A. Fifteen dollars. 
 
 Q. How much testimony was there — how many pages ? 
 A. I should suppose some twenty or twenty-five pages. 
 
 By Mr. Broomall : 
 Q. Whose testimony was it ? 
 
 A. It was the testimony of Steadwell, one of my deputies, of Thurlow Weed, 
 and of Brown. There was nothing in Stead well's testimony that amounted to 
 anything; nothing that affecteJ me at all. As to Mr. Weed's testimony, I am 
 sure I do not know why it was put in. It did not refer to me especially at all, 
 
 Q. Was the testim my of Mr. D wight included I 
 
 A. Some of D wight's testimony, but only a portion of it. There was nothing 
 in it amounting to anything. I do not remember a word it contained. 
 Q. Was there anything in Brown's testimony ? 
 
 A. There was a good deal in Brown's testimony. It was more important and 
 more objectionable to me than any of the rest, for the reason that portions of it 
 contradicted my own, squarely, and I think a man has a right to be a little 
 sensitive in regard to that description of testimony. I testified before you, and 
 repeated, that I never gave, or caused to be given, to any member of the Presi- 
 dent's family, or any one else, one dollar for my appointment. 
 
 Q. Did you receive, directly or indirectly, any. money from the sale of the 
 cartage business ? 
 
 A. Never one dollar. 
 
 Q. Then is the whole statement of Brown, as he gives it, untrue ? 
 
 A. I did not say that. What I have stated is true, and Mr. Brown could not 
 swear truthfully that it is not. 
 
 Q. He did swear that on some two different occasions the sum of $250 passed 
 through his hands from sales of the cartage business. 
 
 A. I testified as to how the cartage business was disposed of. 
 
344 
 
 NEW YORK CUSTOM-HOUSE. 
 
 Q. You did not state Low you had found out 1 1 j * - cartage business? 
 
 A. No; but if you will examine my testimony you will lind that I stated a 
 portion of the proceeds from cartage business went to some parties in Wash- 
 ington) th oogfa Mr. Brown's hands 
 
 Q. Wh were these parties in Washington? 
 
 A. Ne ip-spaper men. 
 
 Q. ^^' 7i at papers ? 
 
 A. I do not know. 
 
 Q. W ho were the parties in Washington ? 
 
 A. I know (Jovernor PraM was one of the parties applying. 
 
 Q. Did the money go to him? 
 
 A. I am not certain ; I cannot tell you. 
 
 Who else besides (Jovernor Pratt was interested? 
 A. I did not know that he was He represented, as I supposed, the National 
 Intelligencer. I never saw any of these parties. 
 Q. What other parties ? 
 
 A. Keys Meagher was another; and another was a gentleman who lias since 
 died. I do not remember his name. 
 
 By the CHAIRMAN : 
 
 Q. Do you mean that the committee shall understand that you did not receive 
 about $250 a month from the cartage bnsineas, but that you did not want any- 
 thing to do with it, and turned the matter over to Brown ? 
 
 A. The cartage business was divided into four branches. Three of the par- 
 ties represented their own divisions, and the fourth went through Brown, and 
 after charging the salary of the person who attended to the interests of the 
 fourth partner, the proceeds were remitted to Governor Pratt. 
 
 By Mr. BROOMALL : 
 
 Q. So that, if I understand it now, there was a bargain made by you, or 
 with your concurrence, with the men who did the cat ting, that one-fourth of the 
 clear proceeds were to go to Governor Pratt, or somebody else, to support the 
 Intelligencer in Washington 1 
 
 A. I did not know that. 
 
 Q. Were to go, then, to Pratt, or somebody else ? 
 A. Yes, sir. 
 
 Q. Who rendered no service, and did no part of the carting business ? 
 
 A. As I said, the carting business was divided into four interests, and that 
 one-fourth interest was represented in this way. 
 
 Q. Is there any other branch of your business (such as the storing of un- 
 claimed goods, for instance) that is let out in a similar manner? 
 
 A. No, sir; that is not true. I deny that there is any let out in any manner 
 
 Q. I mean in reference to which you made a similar bargain. 
 
 A. No, sir ; none whatever. The cartage business was divided into a fourth 
 interest, as I have stated ; but there is no arrangement, or condition, or partner- 
 ship in reference to any other branch of the business, that I am aware of, dis- 
 posed of in that way. The general order business and the lighterage business 
 are represented by the parties doing business ; and there is no arrangement with 
 them of a similar nature at all. There is no interest under me in any way that 
 is not represented in fact by the parties, except as I have stated. 
 
 Q. There is nobody in Washington who has any interest, directly or indirectly, 
 in the cartage or lighterage business? 
 
 A. Not the slightest in any form or shape. 
 
 By the QhaiAman : 
 Q. Did the person who met you, and brought that testimony, state his name ? 
 A. He did not. I did not know his name. 
 
NEW YORK CUSTOM-HOUSE. 
 
 345 
 
 Q. Was he the reporter himself? 
 
 A. Not the reporter who took my testimony. 
 
 Q. Did he represent himself as controlling, or having, the original notes ? 
 
 A. He did not represent himself in any way. I stated to him that I was 
 very busy. He said : " I am aware of that," and then added, " but I want to 
 put that into your hands personally." It was marked on the outside $15. I 
 paid him the money, put the bundle on my desk, and did not look at it for 
 some time. 
 
 Q. Did he go into your private rooms. 
 
 A No ; he stood by the desk of the appointment clerk when I came out. 
 Q. Can you give a description of the man. 
 
 A. He was a man of rather small stature, much smaller than the man who 
 took my evidence. 
 
 Q. Do you recollect the complexion of his hair or whiskers ? 
 
 A. He M as of a sandy complexion. I did not think it worth while to ask 
 the man any questions. 
 
 Q. I understand that he in no way conveyed to you the idea that he was a 
 reporter, or as having in possession the original notes of the testimony ? 
 
 A. Not at all. The woman who came to me gave me an idea that she had 
 opportunities to obtain copies of the testimony. 
 
 Q. You state in your testimony that you had agreed to give the general order 
 business, or the results of it, so and so ; in one instance, specifically referred to 
 parties who had helped you in Washington. I want to ask if you can state to 
 the committee who the parties were with whom that agreement was made, and 
 if you recollect what was the consideration ? 
 
 A. I never testified that I had agreed to give it to anybody. 
 
 Q. You used that word in your testimony 1 
 
 A. I contemplated giving it to certain parties. I never made any agreement. 
 Q Did not you use that specific word ? 
 
 A. If I did it was erroneous. I can state most positively that from the begin- 
 ning I did not agree to give any part of the business to anybody. Whatever 
 errors I committed, I avoided embarrassing myself with promises. 
 
 Q. It is stated by one of the wituesses, who gave you a letter from the 
 President, that you replied to him that you regretted you had not known it be- 
 fore ; that you put your hand to your head, as if a little confused, and said, " I 
 have agreed with parties," &c. 
 
 A. If that term was used at all, it was at a time when I considered myself 
 committed to Miller & Conger. I had agreed to give — or rather I had not agreed, 
 for I had never made any agreement as to what I would do in the business, 
 but it was my intention to have given — the business to these parties. I may 
 have expressed regret to Barr, Phelps & Co., who came there with an in- 
 dorsement on the back of their application from the President, stating that if 
 it was consistent with the public interest, he would be pleased to see their ap- 
 plication granted, or something of that sort. I replied, " Gentlemen, you are 
 too late. I have agreed to give it to other parties." At that time I had agreed 
 to give it to Miller & Conger, but their arrangement for stores, I believe, failed, 
 so that they gave it up, and relieved me from any embarrassments in regard to 
 it. There was a Mrs. Perry, also, who was interested in the application of 
 Barr, Phelps & Co. She told me that she was interested in getting the con- 
 tiact they desired ; that she was here on expense ; that she was SI00 in debt, 
 &c: and that it was a great hardship on her part. At that time Johnson in- 
 timated to me that he would be willing to give $40,000 for the business ; or 
 that he would give a larger sum. I recollect saying to him that if he would 
 give me a million dollars 1 would not give it to him, as long as I had commit- 
 ted myself to other parties. I never laid a straw in the way of Miller & Con- 
 ger carrying out their contract. They came to me voluntarily and stated they 
 
34G 
 
 NEW YORK CUSTOM-HOUSE. 
 
 would be obliged to give it op. I then made up my mind to M change the ar- 
 rangements of 1 1 1 < - general order business and the cartage business as to be 
 more favorable to the merchants. Thai was the first idea I bad when I went 
 into the business; and that I would be more favorable to the merchants, and 
 thereby take away the plum which was being contended for. Subsequently, 
 Johnson came to me and said that matters had changed so thai lie could not 
 give me as much as he had stated; that he did D >t know that the bnsinetl W&i 
 worth anything. I told him to excuse me until I had asked him; tli.it I would 
 not accept anything for it; that 1 intended to make it more .-at is factory to the 
 merchants. 
 
 By Mr. BROOMALL : 
 
 Q. State whether the arrangement you bad in reference to the cartage busi- 
 ness was made before or during the pendency of matters with .Miller tV Conger, 
 under your proposed bargain with them. 
 
 A. About the same time. 
 
 Q. Not afterwards > 
 
 A. No; about the same time. 
 
 Q. You said thai the statement of Brown, that about $25" for two .-uccessive 
 months in the cartage business came to these parties in Washington, was true. 
 Will you state now how many other remittances came here, other than these two 
 testified to by Brown. 
 
 A. My impression is that about that has been remitted every month since I 
 Lave been in the office. Whether they ever got the money or not 1 do not 
 know ; I never had anything to do with it. 
 
 ( v >. Who kept the account after Brown left ? 
 
 A. I do not know. I heard that parties here declined to receive it. Whether 
 that was true or not I do not know. 
 
 Q. You say your understanding was that the money was to go for the sup- 
 port of the Intelligencer. Will you state what induced you to contribute money 
 to support the Intelligencer? 
 
 A. 1 dc not know, unless it was some enormous obligation I was under, as I 
 seemed to be to almost everybody at that time. 
 
 Q. What was it that induced you to contribute it ? 
 
 A. The representations of Governor Pratt and his friend, who was with him. 
 Q. Who was his friend ? 
 A. Ex-Mayor Berrett. 
 
 Q. Had you any other inducement than to comply with the requests of these 
 men ? 
 
 A. I think it was their representations that led me to do it. 
 Q. What were those representations ? 
 
 A. I think they represented that parties in the National Intelligencer had 
 been very friendly to me, and that I ought to do something for them. I found 
 about that time that almost everybody had been very friendly to me. I hap- 
 pened to know some of the editors of that paper, and I believe it was repre- 
 sented to me that they assisted in getting my nomination confirmed. 
 
 Q. Did they represent to you that anybody connected with the. administration 
 wished to have this contribution made ? 
 
 A. I am not certain whether they did or not. I presume they may have 
 conveyed some such impression to me. I did not do it, however, in connection 
 with the wish of anybody connected with the administration. My impression 
 is, they told me the paper was in need. I was called upon to contribute for al- 
 most everything — probably from the impression then that the office was much 
 more lucrative than it proved to be. I made contributions myself out of my 
 own pocket for various purposes. 
 
NEW YORK CUSTOM-HOUSE. 
 
 347 
 
 Q. State whether you made these contributions before you were appointed 
 or afterwards. 
 
 A. Afterwards ; not a cent before. 
 
 Q. State to whom you made them 1 
 
 A. I cannot state that ; they were private matters. 
 
 Q. Then you decline to give the names of the parties of whom you were 
 speaking ? 
 
 A. I gave $500 to a Johnson club. I do not remember the name of the 
 other parties. 
 
 Q. Did you give any to a member of the President's family ? 
 A. Never; directly or indirectly. 
 
 Q. It is stated in the evidence that you said you were sorry you had ever 
 undertaken to provide for the President's family. 
 
 A. The gentleman who gave that evidence is not aware of my having said 
 so. There is some mistake about that. 
 
 Q. Then you say that is not true ] 
 
 A. It is not, any more than if he or any other man had sworn that I regretted 
 committing murder. I never expressed any such regret, for I never had any- 
 thing to do with the President's family. 
 
 New York, December 24, 1866. 
 
 SIR: In conformity with your request we have the honor to hand you herewith copies of 
 the letters which were addressed by us to the Secretary of State on the 17th day of Septem- 
 ber last, and by him transferred to the Secretary of the Treasury, and where they remain as 
 yet without reply. 
 
 Letter A is that of our firm. 
 
 Letter B, that of Messrs. Auguste Seydoux, Sieber &. Co., of Paris. 
 
 In submitting these documents, permit us to say that our motive is to insure the abandon- 
 ment, by congressional action, if possible, of the obnoxious measures. Positive informa- 
 tion has come to our knowledge that the invoices and the samples of the goods shipped to 
 this country by our above-mentioned friends have been exhibited to, among others, a com- 
 mission house engaged in the American trade, and who alluded to and acknowledged it. 
 We think proof sufficient can be given of the abuse of the power concentrated in the con- 
 sul's hands, and while we should not do more than remonstrate against the injury to our 
 business which would result from exposing its character and extent to competing manufac- 
 turers, we do earnestly and solemnly protest against its exposure to any and all persons en- 
 gaged in the American trade. 
 
 We have the honor to be, with great respect, yours, 
 
 BENKARD & HUTTON. 
 
 Hon. Calvin T. Hulburd, 
 
 Chairman Investigating Committee. 
 
 A. 
 
 New YORK, September 7, 1866. 
 
 Sir: We have the honor to enclose a copy of a letter addressed to us by our friends Messrs. 
 Seydoux, Sieber & Co., of Paris, with the translation thereof, and an original circular, with 
 translation of same, reference to which is made therein, and which we respectfully request 
 may receive your consideration. 
 
 We have determined to communicate the contents of these documents to the department, 
 for we confess to a sense of humiliation as Americans and merchants that such regulations 
 and exactions should be established under and, as is declared, by authority from Washington. 
 
 In submitting this letter, however, permit us to remark that we have, on a previous occa- 
 sion, alluded to the eminent respectability of its authors, and to add that they are esteemed 
 alike at home and abroad, and by none more than by their own government, for the honorable 
 position they have attained in their long career as the largest manufacturers in France. 
 
 We make these observations in order that no misconception of the purpose and object of 
 their remonstrance, and in which we entirely concur, should be entertained — the removal of 
 a measure fraught with annoyance, mischief, and injury to individual interests, and of no 
 real utility in itself. 
 
348 
 
 NEW YORK nr.STOM-HOr.SE. 
 
 Our friends Feel that they have a right to give utterance to their sentiments on such a subject, 
 inasmuch m they bave paid into the treasury of the United states for duties, since thirty-six 
 
 years, cm goods of their own manufacture, an amount varying from .s|0(l,(iiiil per annum at the 
 beginning, to t.\ cr .s7i!(l,(lOI» per annum, the last year/ 1 HC,."i ; ami we can ourselves unhesi- 
 tatingly declare, as a proof of the loyalty of their transactions, that during this long period 
 no question has heen raised to our knowledge regarding the fairness of the value of their 
 various products, other than that they have uniformly been considered by the expci ts as rather 
 above than below those of similar character emanating from other sources. 
 
 Indeed, we know by comparisons instituted hy ourselves from time to time that sued, has 
 generally heen the case, and often very greatly to their disadvantage. 
 
 The attempts previously made by some of our consuls to exact the delivery of samples ot 
 the goods intended to be shipped to this country before granting their certificate, having been 
 abandoned for want, as we were informed, of legal authority, we are constrained to believe 
 that the revival of the measure now would not have occurred without some new instructions 
 from Washington. Hut we question w hether it was intended to permit so broad a latitude as 
 that embodied in the circular, under, among other, articles — 
 
 "No 5. Requiring the nai >f the manufacturers to be given in every case, either on the 
 
 invoice or on the cards to which the samples must be firmly attached, and, in some cases, 
 as with gloves, it is made imperative to give it on the invoice/ 1 
 
 No. 7. Which declares that when goods shall be insufficiently described, either OH tin; in- 
 voice or on the cards ot samples, or when the consul may judge it necessary, he may exact 
 that the shipper produce satisfactory proof of the Correctness of the invoice, and the proofs 
 shall be given under oath, as the consul may determine. 
 
 We cannot believe it possible that such instructions have been given by the government of 
 the United States, to be enforced In a rbreijn country before the privilege of shipping the 
 products of that country to the United States should be allowed. 
 
 Can it be that the United States government, as one of its means of executing the revenue 
 laws, feels justified in resorting to u measure which compels merchants to reveal the direct 
 sources from whence their supplies are drawn, thus forcing them to abandon one of the great 
 instruments of success, secrecy, by subjecting the results of their skill, ingenuity, and toil to 
 exposure ! 
 
 If so, then the intelligence, ability, and enterprise of the one will be sacrificed to the in- 
 sufficiency of the other. An illustration may serve in one ease to show how injuriously the 
 demand of the name of the manufacturer may be. A buys of \\ one hundred pieces of goods 
 at a price, and when shipped the manufacturer's name is given, at the same time Ji sells to 
 C, a competitor of A, five hundred pieces ten percent, less: fin- same manufacturer is given. 
 A learns the fact by means of the samples, and H's transactions are disclosed. It is useless to 
 demonstrate what the results of this disclosure would be. ♦ 
 
 It is said in article.") that these samples, with the manufacturer's name attached, will be kept 
 secret. Of what usefulness, then, these samples and the revelations attached to them I And 
 if exposed, who will insure that they will not be submitted to just those who, instigated by 
 jealousy or actuated by malevolence, are ever rendy to seek to advance their own interest 
 by injury to others? 
 
 Cases of this kind have come to our knowdedge. Indeed, we are informed that there exists 
 at this moment, in Paris, an inquisitorial committee of three or more persons, composed of 
 individuals carrying on the export trade to this country, to whom are submitted, not only 
 the samples, but the invoices of shippers, their own competitors. If this is so, and we have 
 reason to ttrink it is, have we not arrived at the point where secrecy is not practiced? And 
 do not the members of this committee enjoy an unwarrantable, not to say shameful, power 
 and advantage over their competitors, and are their competitors not exposed to the malice 
 or vindictiveness which may animate them, and which successful rivalry may entail ? More- 
 over, do not these extraordinary measures cast a stigma upon the character of the mer- 
 chants of America engaged in the foreign trade? 
 
 Are not the laws for the protection of the revenue sufficiently severe not to resort to such 
 means, and may they not be properly regarded as onerous and unjust to all loyal merchants, 
 amounting, in fact, to indignities ? 
 
 Already shippers to this country must furnish three invoices for every shipment, one for the 
 consignee, one for the consul, and one for the custom-house here, and now he is called upou 
 to give samples of his exports of every description, kind, and quality, and expose the sources 
 and names of the producers, or submit to such conditions as the consul may prescribe. 
 
 Do these measures tend to foster and develop, or embarrass and arrest, commerce ? Are 
 they creditable to the country which seeks to enforce them ? Are they justified by the laws ? 
 
 As American merchants of long standing we have been always, ever ready to aid the gov- 
 ernment, as is well known here, where we are known, in giving the benefit of our experience 
 and knowledge to arrest any attempt to defraud the revenue; and although the interests of 
 our friends and ourselves may have suffered in the course of time from the success of some 
 of these attempts, but which we believe to be of rare occurrence, we feel it our imperative 
 duty to protest against these new measures, as we can but regard them as an infiingemeut 
 of individual lights, and calculated to do great injury to the many, and to result in no good, 
 unless the increased expenditure for government and the augmentation in number of United 
 States agents should be so considered. 
 
NEW YORK CUSTOM-HOUSE. 
 
 349 
 
 In conclusion, we respectfully request that this subject will receive your early attention, 
 and hope that our appeal to you may result in the final abandonment of the obnoxious 
 measures. 
 
 Soliciting a reply, we are, sir, with distinguished consideration, your obedient servants, 
 
 BENKARD & HUTTON. 
 
 Hon. Wm. H. Seward, 
 
 Secretary of State, Washington, D. C. 
 
 B. 
 
 [Translation.] 
 
 Paris, J>,ly 10, 1866. 
 
 Gentlemen : We received a few days ago from the United States consul in Paris, a cir- 
 cular, of which we enclose a copy, and to which we beg to call your most serious attention. 
 We understand very well that, in the interest of the Treasury, as well as in the interest of 
 loyal merchants, the administration at Washington should prosecute with ardor the full and 
 entire execution of the laws. 
 
 But why have recourse, for this purpose, to new measures so troublesome and so vexatious 
 for the trade, when they already possess means of investigation which we fear not to declare 
 defy all those of any custom-house in the world ? 
 
 And how can the United States government prescribe to its agents a system of investiga- 
 tion which is without utility, and which would have for its infallible result the intrusion in 
 one's business of one's own competitors— precisely those who are the most interested in obtain- 
 ing a knowledge of it in order to thwart its successful results? 
 
 Permit us. Laoreover, to examine rapidly some of the obligations which the consul of the 
 United States pretends to impose upon our business. Numbers 1 and 2, which read — 
 
 " 1. It will be required hereafter that all invoices presented at this consulate for certifica- 
 tion be accompanied by samples of the goods therein mentioned, whenever such goods are 
 susceptible of being sampled. 
 
 " -4. To facilitate the regular execution of this measure the consul has prepared, and holds 
 at the disposal of the shippers, cards destined to receive the samples. These cards only will 
 be received. Samples must be of the size of the cards, and to which they must be firmly 
 attached." 
 
 Can it be believed that, having in their power to examine, in the New York custom-house, 
 piece by piece, all imported goods, and leisurely to compare the invoiced prices, declared by 
 all the importers, without exception, they exact from the foreign shippers a sample, supposed 
 to represent sometimes hundreds and sometimes thousands of pieces, of the same article and 
 of the same quality? . And that sample, no matter how carefully selected by the shipper, 
 can it ever take tlie place, in the eye of the custom-house officials, of the goods themselves, 
 which they can examine at their leisure, from the first piece to the last ? 
 
 It may be objected, perhaps, that the market price of an article is better known in the 
 places of production than in the New York custom-house, or other ports of the United States. 
 This is a grave error. In the first place it must be remarked that, a quantity of articles are 
 manufactured in Europe for the special consumption of the United States, and upon special 
 orders, without a single piece being sold where the goods are made. 
 
 Secondly. Who will believe that the New York custom-house, for instance, under whose 
 inspection pass, in succession, all goods intended for special or general consumption, and 
 who can at once establish points of comparison, not upon mere samples taken, in some 
 measure, at random, but upon as many pieces as they please lo examine, should not neces- 
 sarily possess elements of valuation much more reliable than those which could be obtained 
 by the person or persons charged with this duty in Europe by the United States government ? 
 
 Is it not, indeed, evident that those government agents would find it absolutely impossible 
 to enlighten the administiation upon the market values of those special articles alluded to, 
 which leave Europe without having ever been offered for sale? With regard to the other 
 articles, how can those agents determine their market value with any accuracy upon the 
 places of production? 
 
 Not being intrusted, no doubt, with the purchase of goods for government account, amission 
 for which the agents would probably be but indifferently prepared, they would have no alter- 
 native but to have recourse to the experience of persons who are in the habit of making pur- 
 chases in Europe. 
 
 But those persons will not all be situated alike; they will differ in their degree of intelli- 
 gence, their skill in making purchases, in the credit they may enjoy, and in the importance 
 of ih dr transactions. They therefore would not all pay the same prices, would not all ob- 
 tain the same discounts, or the same facilities for their payments. Then the information 
 which they might furnish to the agents of the government— would it always be exempt from 
 that spirit of jealousy and partiality which predominates more and more in business ? We 
 can hardly admit it. 
 
350 
 
 NEW YORK CUSTOM-HOUSE. 
 
 No. 3. "Nd invoice whatsoever will be admitted unless it be perfectly fa/ftls, mid designate 
 the goods in such a manner that everybody can understand it, even tbON DOl acquainted 
 technically with the articles invoiced. Any omission of the required indications, either upon 
 the sample card or on the invoice, will subject the applicant to a refusal of the invoice." 
 
 What is meant hy articles of the same name and description/ Probably MTticlei of the 
 same kind having the same name, lint how can it be possible to put upon the same page 
 hundreds, thousands of pieces of the same kind which might be included in the same ship- 
 ments represented by a single invoice' And how, when it concerns a shipment of goods of 
 some importance, more or less cumbersome, of various kmds and qualities, can all the goods 
 
 of the same description be made to come in rotation <m the invoice, which might not all be 
 ready at the same moment .' It would be necessary, then, to wait, in ordei to ship them, until 
 the whole wen- received and entered, which is not practicable, DO matter how vas, the ware- 
 houses one might control. There are in these thingl material impossibilities w hich require 
 
 no demonstration. 
 
 NoSi 4, f>, (>, and 7 we pass without comment, in spite of the reflections which they sug- 
 gest, because they touch but partially piece goods. 
 
 No. b. 44 Invoices will not be returned to the shippers with the consular certificate under 
 twenty-four hours alter having been left at the consulate. The desire <'f the consul is to do 
 all in his power, to prevent this measure, poecssarv for the protection of the treasury, from 
 
 shackling or obstructing trade ; but he deems it his duty to notify shipper that any ii regu- 
 larity in the sample or invoice will entail either the refusal of the invoice or delay- in tbfl de- 
 livery of the goods, and invites them to conform in every respect to the foregoing instructions, 
 which are communicated by order of the government. 11 
 
 According to this clause, the shipper w ould be prevented from sending his goods to Havre 
 either on the day before or the preceding day t<> that ol the departure of steamers, thus losing 
 
 the benefit of the rapidity of communication without being exposed t<» have the goods arrive 
 at New Yolk before the invoice, w hich would prevent the consignee from disposing of the 
 goods, and would, moreover, entail considerable expenses df warehouses. We shall not push 
 our observations further; but if. as we have no doubt, you should find them well-grounded, 
 
 we beg of you, in behttlf of a general good, to submit them to the administration at Wash- 
 ington, and to support them w ith all your power. 
 
 We are, gentlemen, cordially Fours, 
 
 AUG. 8EYDOUX, BIEBEK & CO. 
 
 Messrs. BENKARD & BUTTON, Nete York. 
 
 O 
 
INDEX 
 
 A. 
 
 Page. 
 
 Alliban, James R. , testimony ot - - - J 1 
 
 Amsinck, L. E., testimony of 262 
 
 Anger, Calvin, testimony of 166 
 
 Armstrong-, Henry J., testimony of 287 
 
 Second examination of..-- 288 
 
 Arquimbau, Daniel V., testimony of 268 
 
 Asten, Thomas B., testimony of 106 
 
 B. 
 
 Bang, Harry J., testimony of : 305 
 
 Barber, J. A., testimony of 280 
 
 Barbey, Henry J., testimony of 273 
 
 Barney, Hiram, testimony of 172 
 
 Barr, Thomas J., testimony of., 79 
 
 Second examination of 83 
 
 Barstou, Wilson, testimony of 109 
 
 Bartels, George, testimony of 234 
 
 Batjer, Herman, testimony of 253 
 
 Bayard, Theodore W., testimony of 224 
 
 Second examination of 226 
 
 Beecher, J. S., testimony of 258 
 
 Bemas, John S., testimony of 321 
 
 Benkard & Hutton, letter of, relative to custom-house regulations 347 
 
 Benuer, Valentine, testimony of 306 
 
 Bensnsan, Joseph, jr., testimony of 266 
 
 Bigelow, John, testimony of 333 
 
 Birdseye, Lucien, testimony of - 204 
 
 Bixby, Butler H., testimony of... 32 
 
 Bixby, Francis M., testimony of, as to general order business 24 
 
 Second examination of 130 
 
 Third examination of * 32 
 
 Bowen, Henry C, testimony of - 307 
 
 Bowen, editor of Independent, alleged interest in the general order business, under 
 
 Mr. Barney 143 
 
 Allegation denied by Barney 172 
 
 Brewer, A. L., testimony of 161 
 
 Brown, Bartholomew, testimony of 304 
 
 Brown, Thomas, testimony of 91 
 
 Bruce, Hamilton, testimony of 36 
 
 Bugbee, J. F., testimony of 170 
 
 Second examination of 171 
 
 Burchardt, E., testimony of 276 
 
 Buttons, trimmings, &c, seizure of, testimony of A. Heidsick 294 
 
 C. 
 
 Cassado, Phillipe, testimony of 263 
 
 Chittenden, L. E., testimony of 23! 
 
 Clinch, Charles P. , testimony of 340 
 
 Constable, D. C, statement of, relative to vessels seized or reported 316 
 
 Cooks, John A., testimony of 108 
 
 Courtney, S. G., statement of, as to Farwell's services 208 
 
 D. 
 
 Dale, John G , testimony of 161 
 
 Second examination of 319 
 
 Dale, Thomas N., testimony of 290 
 
352 
 
 INDEX. 
 
 Pus.'.-. 
 
 De Barry, Frederick, testimony of u\i 
 
 Second examination of 218 
 
 Third examination of 219 
 
 Fourth examination of 219 
 
 Dittenhoffer, A. J., testimony of 310 
 
 Dix, John A , naval officer, share of forfeitures paid to 2^3 
 
 Doolittle, sun of senator, alh-jrcd interest in general order business. (See testimony 
 of I\ A. Van Bergen, (J. 1". Thomson, G. \Y. Fmbiec, T. Hrown, J. F. Fierce, and A. 
 
 Spalding. ) 
 
 Doeler, James, testimony of 277 
 
 Dry poods, seizure of. (See testimony of J). McL)ougal, II. J. Armstrong, and S. 
 Brenner. ) 
 
 Lwight. Timothy ('., testimony of 126 
 
 Second examination of |M 
 
 E. 
 
 Edwards, Kohert. testimony of 140 
 
 Embree, George Y\\, testimony of 57 
 
 Engravers' and artists' materials, seizure of, (see testimony of W. Slums) 3<iil 
 
 Escourra, F. P., testimony of - BM 
 
 Fancy goods, seizure of. (See testimony of 11. < ). Stresbeiger and J. E. Kel.er.) 
 
 F. 
 
 •Torwell, W. B., testimony of 207 
 
 Statement as to value of services of 208 
 
 Champagne seizures 216 
 
 Testimony of, before United States district court in New York 220-222 
 
 Fulton, Hamilton, testimony of 147 
 
 G. 
 
 Gardner, Stephen E., testimony of 159 
 
 Gautier, John, testimony of 320 
 
 Gibbs, Montgomery, testimony of 177 
 
 Second examination 186 
 
 Third examination 193 
 
 Character and standing of 201 , 202, 206 
 
 Letters of, relative to Reims wine 222,223,2:9 
 
 Letters relative to services of Leuchtenrath 243, 2 16 
 
 Previous character of 201 , 206, 219 
 
 Getty, R. P., testimony of Jot) 
 
 Glassy. Samuel J., testimony of 309 
 
 Goughertv, William P., testimony of 220 
 
 H. 
 
 Hagan, Thomas, testimony of 319 
 
 Hanscom, Albert. (See seizure bureau. ) 
 
 Harrimau. Charles, testimony of 303 
 
 Hart, George \Y., testimony of 144 
 
 Heerdt, Clement, testimony of 256 
 
 Heidsick, A., testimony of 294 
 
 Heidsick, Charles & Co., letter of, relative to Reims wine . . .' 227 
 
 Heron, James, testimony of -'"'i 
 
 Herzog, Fhilip, testimony of 2-4 
 
 Hides, seizure of, testimony of G. Savory 293 
 
 Hill, Amos, letters of, relative to Reims wine 227, 228 
 
 Hitz, John, testimony of 3 
 
 Hogeboom, John T., testimony of 321 
 
 House. Frederick, testimony of 203 
 
 I. 
 
 Isaacs. Alexander, testimony of 311 
 
 J. 
 
 Joel, William, testimony of 234 
 
 * The first examination of this witness is printed in the Boston custom-house report. 
 
INDEX. 
 
 353 
 
 Pago. 
 
 Johnson, Edward C, testimony of 83 
 
 * Jordan, Edward, testimony of Ill 
 
 Second examination of 123 
 
 Letters of instruction to M. Gibbs 114, 115 
 
 Letter from Consul Murphy to, relative to American securities 126 
 
 K. 
 
 Kanski, John, testimony of 312 
 
 Kellam, B. G., testimony of 313 
 
 Statement of, relative to vessels seized or reported 315 
 
 Keller, Ignatz, testimony of 270 
 
 Knox, Alexander, testimony of 362 
 
 Kuntz, Emil, testimony of 255 
 
 Kutter, Gustave, testimony of 270 
 
 Second examination of 272 
 
 L. 
 
 Laces, seizure of, (see testimony of A. Lausen) 301 
 
 Lastings, bindings, &c, seizure of, testimony of G. E. Sparrow 294 
 
 Lane, Barret H.^ testimony of ., 140 
 
 Lausen, Andrew, testimony of 301 
 
 Leuchtenrath, Edward, testimony of 238 
 
 Second examination of 241 
 
 Deposition of, as to value of services, &c 240 
 
 Letters of, on same subject 243-248 
 
 Levy, Henry, testimony of 203 
 
 Second examination of 241 
 
 Agreement of, with Farwell 248 
 
 Livingston, V. B., testimony of -• 168 
 
 M. 
 
 McCulloch, Secretary of the Treasury, letter of, relative to charges against Smythe.. 98 
 
 McDougal, Duncan, testimony of 285 
 
 MeElrath. Thomas, testimony of 327 
 
 Mclntyre, William, testimony of 137 
 
 McMullen, Thomas, testimony of 269 
 
 Mann, Francis, testimony of 306 
 
 Mather, John C., testimony of 35 
 
 Mensing, F., testimony of 295 
 
 Miller, Abram B., testimony of 100 
 
 Second examination of 104 
 
 Miln, George, testimony of 261 
 
 Mumm &, Co., letters of, relative to Reims wine 223,229 
 
 Mussinen, Oscar, testimony of 297 
 
 Myer, James, jr., testimony of 251 
 
 Myers, Henry J., testimony of 155 
 
 O. 
 
 Oechs, Anthony, testimony of 249 
 
 Oakley, Thomas H., testimony of 280 
 
 Second examination of 281 
 
 Ogden, Samuel G., testimony of 176 
 
 Second examination of 282 
 
 P. 
 
 Patterson, Senator, alleged interest of, in general order business. (See testimony of 
 F. M. Bixby, B. H. Bixby, G. W. Embree, T. Brown, J. F. Pierce, A. Spalding, 
 and A. H. Pratt.) 
 
 Perrin, P. A., testimony of 257 
 
 Perry, Mrs., alleged interest of, in general older business. (See testimony of F. M. 
 Bixby, E. R. Phelps, T. J. Barr, T. Brown, and A. H. Pratt.) 
 
 Phelps, Edward R., testimony of r 78 
 
 Phelps, Isaac, testimony of 329 
 
 Pierce, James F., testimony of 96 
 
 x The first examination of this witness is printed in the Boston custom-house report. 
 
 H. Rep. Com. 30 23 
 
354 
 
 INDEX. 
 
 PSJfc 
 
 Pratt, Alfred H., testimony of 10.") 
 
 Pratt, Governor, of Maryland, s.'on paid to, for airfare business !»J 
 
 President of the United States, interview of, w ith Mrs. Perry and others 78, S3 
 
 Be commendation of Barr and Phelps for general order bneineai 81 
 
 K. 
 
 Randolph, O. W 4 P., testimony of 168 
 
 Redfiela, Heman .J., testimony of 173 
 
 Report of the committee ] 
 
 Reynauld, Peter H., testimony of 233 
 
 Ribbons, !-i His, &c, seizure of. (See testimony of (i. Kntter, H. J, l>arl>ev, J. J. 
 Thomas, E. Burehardt, J. Doeler, A. Soleliac, C. Harriman, and 11. Hrown.) 
 
 Rooney, C. J., testimony of 99] 
 
 Roux, Alexander, testimony of 296 
 
 S. 
 
 Savory, George, testimony of 293 
 
 Schell, Augustus,, testimony of J72 
 
 Schirmer, Charles P., testimony if •. 318 
 
 Seydoux, Siober & Co., letter of, relative to eustom-house regulations 349 
 
 Smythe, Henry E., collector, testimony of 06 
 
 Second examination of 77 
 
 Third examination of 342 
 
 Official oaths of J 77 
 
 Charges against, by Spaulding 96 
 
 Share of forfeitures received by 283 
 
 Slums, William, testimony of 3U0 
 
 Soleliac, August, testimony of 299 
 
 Soinborn, Lazarus, testimony of 306 
 
 Seizure bureru, operations of. (See testimony of D. T. Waldeu, S. J. Glassy, A. J. 
 Dittenhoffer, A. Isaacs, J. Kanski, and B. J. Kellam.) 
 
 Sparrow, George E., testimony of 294 
 
 Spaulding, Alexander, testimony of 96 
 
 Squier, Frank, testimony of 33 
 
 Second examination of 34 
 
 Steedwoll, Jeremiah H., testimony of 37 
 
 Second examination of , 39 
 
 Third examination of . 40 
 
 Stehn, Theodore, testimony of 258 
 
 Stevens, John B., testimony of 153 
 
 Stone, David M., testimony of 149 
 
 Stresburger, R. Oscar, testimony of 2*9 
 
 Stursberg, H., testimony of 278 
 
 Sugars, seizure of, testimony of W. Joel 284 
 
 Supplies of steamers— Wakeman, surveyor. (See testimony of C. F. Skinner, J. G. 
 Dale, T. Hagan, J. Gutier, and J. S. Bemas. ) 
 
 T. 
 
 Teller, Richard H., testimony of 236 
 
 Thomas, John J., testimony of 275 
 
 Thomson, George F., testimony of 46 
 
 Second examination of 56 
 
 Allegation of interest, in general order business. (See testimony of F. M. 
 Bixby andB. H.Bixby.) 
 
 Thread, seizure of, testimony of A. Knox 302 
 
 Tomes, Robert, testimony of 331 
 
 V. 
 
 Van Bergen, Peter A., testimony of 42 
 
 Van Saun, Charles W., testimony of 164 
 
 W. 
 
 Wakeman, Abram, surveyor, testimony of 173 
 
 Second examination of 176 
 
 Share of forfeitures received by 283 
 
 Walden, Daniel T., testimony of „ 308 
 
INDEX. 355 
 
 Page. 
 
 Walshe, John G., testimony of 254 
 
 Watches, seizure of. (See testimony of J. A. Barber.) 
 Webster & Craig, attorneys. (See seizure bureau.) 
 
 Weed, Thurlow, testimony of 169 
 
 Wine, champagne, seizures of, various statements relative to 322-326 
 
 List of suits pending relative to 326 
 
 List of seizures 216 
 
 Testimony relative to, of M. Gibbs, W. B. Farwell, F. De Barry, T. W. Bayaud, 
 W. P. Goughtrey, L. E. Chittenden, P. H. Reynauld, George Bartels, R. H. 
 Teller, E. Leuchtenrath, A. Oechs, J. Meyer, H. Batjer, J. G. Walshe, E. 
 Kuntz, C. Heerdt, P. A. Perrin, T. Stehn, T. McElrath, J. Phelps, R. Tomes, 
 and J. Bigelow. 
 
 Wines, sherry, of Spain, seizures of. (See testimony of J. S. Beecher, George Miln, 
 L. E. Amsinck, P. Cassado, P. P. Escourra, J. Bensusan, D. V. Arquimbau, and 
 T. McMullen.) 
 
 Wines, Rhine, seizures of. (See testimony of H. J. Bang, F. Mann, L. Somborn, and 
 V. Benner. ) 
 
 Woollens, seizure of. (See testimony of H. Stursberg, T. H. Oakley, and P. Herzog.) 
 Woodruff, Francis, testimony of 165 
 
39th Congress, ) HOUSE OF REPRESENTATIVES. ( Report 
 2d Session. ) \ No. 31. 
 
 OFFICIAL CONDUCT OF THE PRESIDENT. 
 
 February 28, 1867.— Laid on the table and ordered to be printed. 
 
 Mr. J. F. Wilson, from the Committee on the Judiciary, made the following 
 
 REPORT. 
 
 The Committee on the Judiciary, charged by the House with the examination of 
 certain allegations of high crimes and misdemeanors against the President of 
 the United States, submit the following report : 
 
 On the seventh day of January, 1S67, the House, on motion of Hon. James 
 M. Ashley, a representative from the State of Ohio, adopted the following pre- 
 amble and resolution, to wit : 
 
 " I do impeach Andrew Johnson, Vice-President and acting President of the 
 United States, of high crimes and misdemeanors. 
 
 " I charge him with a usurpation of power and violation of law ; in that 
 he has corruptly used the appointing power ; in that he has corruptly used the 
 pardoning power ; in that he has corruptly used the veto power ; in that he 
 has corruptly disposed of the public property of the United States ; in that he 
 has corruptly interfered in elections, and committed acts, and conspired with 
 others to commit acts, which, in contemplation of the Constitution, are high 
 crimes and misdemeanors. 
 
 " Therefore, be it resolved, That the Committee on the Judiciary be, and 
 they are hereby, authorized to inquire into the official conduct of Andrew John- 
 son, Vice-President of the United States, discharging the powers and duties of 
 the office of President of the United States, and to report to this house whether, 
 in their opinion, the said Andrew Johnson, while in said office, has been guilty 
 of acts which were designed or calculated to overthrow, subvert, or corrupt the 
 government of the United States, or any department or officer thereof ; and 
 whether the said Andrew Johnson has been guilty of any act, or has conspired 
 with others to do acts, which, in contemplation of the Constitution, are high 
 crimes or misdemeanors, requiring the interposition of the constitutional power 
 of this house ; and that said committee have power to send for persons and 
 papers and to administer the customary oath to witnesses." 
 
 The duty imposed on the committee, by this action of the House, was of the 
 highest and gravest character. No committee during the entire history of the 
 government had ever been charged with a more important trust. The respon- 
 sibility which it imposed was of oppressive weight, and of most unpleasant na- 
 ture. Gladly would the committee have escaped from the arduous labors im- 
 posed on it by the resolution of the House; but, once imposed, prompt, delib- 
 erate, and faithful action, with a view to correct results, became its duty, and to 
 this end it has directed its efforts. 
 
 Soon after the adoption of the resolution by the House, the Hon. James M. 
 Ashley communicated to the committee, in support of his charges against the 
 President of the United States, such facts as were in his possession, and the 
 investigation was proceeded with, and has been continued almost without a 
 day's interruption. A large number of witnesses has been examined, many doc- 
 
2 
 
 OFFICIAL CONDUCT OF THE PRE8IDENT. 
 
 uments* collected, and everything dene which could be done to reach a conclu- 
 sion of the case. But the investigation covers a broad field, embraces many 
 novel and interesting and important quest ions, and involves a multitude of facts; 
 while most of the witnesses are distant from t lie capital ; owing to which, the 
 committee, in view of the magnitude of the interests involved in its action, has 
 not been able to conclude its labors, and is not, therefore, prepared to submit a 
 definite and final report. 
 
 If the investigation had even approached completeness, the committee; would 
 not feel authorized to present the result to the House at thi- laic period of the 
 session, unless the charges had been so' entirely negatived as to admit of no 
 discussion, which, in the opinion of the committee, is not tin; case. Certainly, 
 no affirmative report could be properly c aisidered in the expiring hours of this 
 Congress. 
 
 The committee not having fully investigated all the charges preferred against 
 the I 'resident of the United States, it is deemed Inexpedient to submit any con- 
 clusion, beyond the statement that sufficient t- .-t imony has been brought to its 
 notice to justify and demand a further prosecution of the investigation. 
 
 The testimony which the committee has taken will pass into the custody of 
 the Clerk of the House, and can go into the hands of such committee afl may be 
 charged with the duty of bringing this investigation to a close, so that the 1 1- 
 bor expended upon it may not have been in vain. 
 
 The committee regrets its inability definitely to dispose of the important 
 subject committed to its charge, and presents this report for its own justification, 
 and for the additional purpose of notifying the succeeding Congress of the in- 
 completeness of its labors, and that they should be completed. 
 
 JAMES F .WIL SOH, Chairman 
 
 Gr. S. BOUTWELL. 
 
 THOa WILLIAMS. 
 
 BURTON C. COOK. 
 
 WM. LAWRENX'E. 
 
 FRANCIS THOMAS. 
 
 D. MORRIS. 
 
 F. E. WOODBRIDGE. 
 
MINORITY REPORT. 
 
 Mr. Rogers, the minority of the committee, submits the following as his 
 views : 
 
 The subscriber, one of the Judiciary Committee, to whom was referred by the 
 House the inquiry to inquire into the official conduct of his Excellency the 
 President of the United States, with a view to his impeachment upon certain 
 charges made by the Hon. James M. Ashley, begs leave to submit the following 
 report : 
 
 The committee refuse to allow a report to be made giving the evidence to the 
 House at this time, upon grounds which are no doubt satisfactory to themselves. 
 Therefore, I cannot report the evidence upon which my conclusion is based, 
 which I would gladly do, did the committee deem it expedient. The examina- 
 tion of witnesses and the records was commenced, as appears by the majority 
 report, about the time of the reference, to wit, on the 7th of January, 1S67, and 
 continued daily. A large number of witnesses has been examined, and every- 
 thing done that could be to bring the case to a close, as appears by the majority 
 report ; and the majority came to the conclusion u that sufficient testimony has 
 been brought to its notice to justify and demand a further prosecution of the in- 
 vestigation."" I have carefully examined all the evidence in the case, and do report 
 that there is not one particle of evidence to sustain any of the charges which the 
 House charged the committee to investigate, and that the case is wholly without 
 a particle of evidence upon which an impeachment could be founded, and that 
 with all the effort that has been made, and the mass of evidence that has been 
 taken, the case is entirely bald of proof. I furthermore report that the most of 
 the testimony that has been taken is of a secondary character, and such as would 
 not be admitted in a court of justice. In view of this conclusion, I can see no 
 good in a continuation of the investigation. I am convinced that all the proof 
 that c^n be produced has been before the committee, as no pains have been spared 
 to give the case a full investigation. Why, then, keep the country in a feverish 
 state of excitement upon this question any longer, a* it is sure to end, in my 
 opinion, in a complete vindication of the President, if justice be done him by the 
 committee, of which I have no doubt. 
 
 A. J. ROGERS. 
 
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 Gift of Seymour B. Di irsT Old Y( >rk Library