FACTS FOR THE INFORMATION OF U. S. Iffiarine Underwriters and Stockholders: T JB E „,w 1E C KIN G SYSTEM AS PURSUED ON THE BAHAMA BANKS; AS WEIL AS OF THE FRAUDS THERE PERPETRATED j And showing how the U S. Underwriters have been, and are now defrauded, by the Ex U. S. Consub, TIMOTHY DARLING AND JOHN F. BACON; Including a Reply to a Pamphlet lately issued by them, entitled " Charges made against the Underwriters’ Agents at Nassau, N. P., Bahamas, with their Refutation.” “ But ships are but boards, sailors but men: there be land rats and water rats, water thieves and land thieves; I mean pirates; and then there is the peril of waters, winds, and rocks.”—JUrrc/wnt of Venice. The undersigned, the recently appointed Consul of the United States at Nassau, New Providence, Bahama Islands, having lately seen a pamphlet emanating from Timothy Darling and John F. Ba¬ con, of the house of T. Darling & Co., Nassau, (both of which individuals, previous to my appointment, were respeetively U. S. Consuls at Nassau,) reflecting upon the course pursued by the undersigned, in the discharge of his Consular functions for prevent¬ ing the perpetration of frauds at Nassau, upon American commerce, deems it expedient, that said pamphlet should have some notice taken of it, as well as of the individuals who are its authors, lest from the •plausible manner in which the same is concocted and endorsed hy the optmons of Darling & Bacon’s friends, they may deceive Ameri¬ can citizens and U. S. underwriters, as they have done heretofore, ai}d thereby commit, with impunity, the like frauds, which I shall presently expose. . Before I entertained, the thought of applying to be appointed U. S. Consul to Nassau, I had some knowledge of Nassau and of the sys¬ tem pursued by the late Consuls, Darling and Bacon, in cases of American vessels wrecked, and those going into Nassau, reported to be in distress, as well as of the disposition there made of them and their cargoes, by Darling and Bacon, in their capacity of Consuls and as alleged agents for U. S. underwriters. I will also venture here to assert, that there is scarcely a Marine Insurance Company in the United States, but which has suffered from the frauds I shall presently detail; nor is there a lawyer, who has tried or heard tried, cases to recover Marine insurance for vessels and cargoes, in any wise connected with Nassau or the Bahama Banks or Islands, but who can testify to the facts I am about to relate, viz. that, in every disputed case the frauds are clearly perceptible, especially in cases of American vessels wrecked and those putting into Nassau, reported to be in distress; which latter, are in very many instances there con¬ demned as unworthy of repair and sold, with their cargoes. That such is the case there is abundant evidence to prove, not only in the United States, but in other portions of the commercial world, as will presently be shown. Having applied, and having been appointed U. S. Consul to Nas. sau, I embarked and arrived there on the 26th of October, 1849. On the 31st October I called upon Bacon and presented to him the communication I bore to him from the Secretary of State. On that day, I saw Bacon, as likewise Darling, his co-partner, for the first time. On the lst November, 1849, I assumed the duties of my office, possessing the knowledge above stated relative to the course pursued by Darling and Bacon, with the full determination of inves¬ tigating the matter, and if confirmed, I felt it to be my conscientious duty, in the faithful discharge of my Consular functions, to make the effort to break up the system, and if possible to have justice done to U. S. Underwriters as well as to American citizens, whose rights were not previously protected, much less respected. I had not long been in Nassau, before, not only my previous knowledge was con¬ firmed, but many new facts were communicated to me by persons who were cognizant of them, from being eye-witnesses to the perpe¬ tration of the frauds. My informers were persons who were perfectly disinterested in giving me the information, which fact is proven to be so, because by availing myself of their information in my efforts to break up the frauds perpetrated, my very informers, with others, would be deprived of the opportunity to purchase wrecked cargoes and vessels upon speculation, and of realizing large and handsome pro¬ fits out of their purchases, by re-shipments and sales, as was the case under the fraudulent system. These perfons also, I am pleased to say, are among the few honest and conscientious persons that are in Nassau. Having had my previous knowledge confirmed, and being also in possession of new facts, I determined to investigate the same further, in order that those facts might also be confirmed. For this purpose, as well as for the purpose of making myself familiar with Consular duties, 1 determined to examine carefully the records and papers in the archives of the Consula'e, .especially tliose which emanated from Darling and Bacon. Previous to doing so, in perusing the “ New 3 York Albion” of the 17th November, 1849, I came across a para, graph in an article entitled “ Wild Sports in the Falldands,” sketched during a survey of those Islands, by Captain Mackinnon, Royal Navy,” in which article the writer, in comparing those Islands with the Bahamas, says: “It is believed that these Islands are frequently made use of by fraudulent persons much in the same manner as the Bahama Banks are in the West India seas—that is to say: ships are purposely lost there to defraud underwriters. Many instances are known of vessels being ‘ cast away ’ in the most unaccountable manner. In several instances ships thus lost in some of the basin-like har¬ bors have been sold for a ‘ mere song,’ recovered at little expense, and are bearing rich freights across the seas 1” The writer further says : “ The very fact of a Naval Officer being on the spot would prevent such disgraceful proceedings, and save thousands yearly.” These facts, so far as the Bahama Banks are concerned, I can confirm, and quoting similar language, say, the very fact of an honr.st U. S. Consul (or honest agent for U. S. mderwriters,) at Nassau, clothed with some little authority and protection by the United States, [neither of which he has now, either under the law of nations, (according to recent decisions of courts,) by treaty (except in very few cases,) or by acts of Congress, as I can testify from experience, and as can also be testified no doubt by many other U. S. Consuls, who have felt in a foreign land the want of both,] would not only prevent the perpetration of frauds at Nassau, and save thousands of dollars, but would actually save underwriters and others hundreds of thousands of dollars yearly. Now by the very paragraph above quoted, the information I was previously in posses¬ sion of, was donhly confirmed, and that too by a disinterested person, a perfect stranger to me and to my informers, and an officer of the Royal Navy of Great Britain, to which nation the Bahama Islands, with its numerous deposit banks, rocks, reefs, cays and harbors belong. Had I, previously to seeing that article, been ignorant of the frauds which had been perpetrated as above stated, that article alone, un- contradioted as it is to this day, would have caused me or any other conscientious man to prevent the repetition of what is there stated as the fact. After having perused the article quoted, I proceeded to examine the books and papers in my office, which emanated from Darling and Bacon while they were respectively U. S. Consuls at Nassau, at which time they also alleged themselves to be, and did act as, agents for all U. S. Underwriters. Having examined the records as stated, I found [admitted to he the fact under their respective signatures in their official correspondence with the Department of Stale] that during the period they respective¬ ly were U. S. Consuls and alleged agents for U. S. underwriters, they condemned, as unworthy of lieing repaired, and sold thirty [30] Ameri¬ can vessels which came into Nassau reporting to be in distress, and 4 the fate they and their cargoes there met, under the hands of those individuals, proved Darling and Bacon to be “more merciless to¬ wards them than the winds of heaven ” had been. These vessels had short voyages to perform, many being bound on coasting voy¬ ages. On the other hand, within the same period of lime in which these thirty American vessels shared the fate they did, but eighteen [18] British vessels and one American vessel [the brigFrancis Amy, -,] also put into Nassau in distress, and went to Messrs. John Thomson & Co., (agents there for Lloyds, Glasgow, Liverpool, and other underwriters in Europe, as well as for Underwriters in the U. States,) under whose direction every vessel was spon repaired at rea¬ sonable expense, and completed their voyages with their original cargoes across the Atlantic, in perfect safety. Not one vessel or cargo which so came there to them was condemned or sold, in the period of time mentioned. This being the case, I had from this fact a know¬ ledge that the fatality attending American vessels exclusively, was not because they could not he repaired, or because the cost of repairs would be more than the vessel would be worth under the admiralty- rule. The above fact is confirmed by Darling & Bacon’s own showing, for, by some of the certificates of ship masters to be found in their pamphlet, it is there alleged, in vindication of themselves, that some of the vessels which put into Nassau in distress, were repaired by John J. Finlayson, and that' his charges are “ moderate and fair.” Notwithstanding the repairs put upon the few vessels alleged to have been repaired, were done at “ moderate and fair ” prices, thirty American vessels were, during the period referred to, con¬ demned, abandoned, and sold as unworthy of being repaired, as follows: By John F. Bacon, Consul, 1340, three brigs and two schooners—total, 5. By Timothy Darling, Consul, 1842, two brigs and three schooners—total 5. And by John F. Bacon, U. S. Consul, 1845, and Timothy Darling, his co-partner, tinder the name of T. Darling ^ Co., one ship, thirteen Irigs, one hark, and/re schooners — total, 20. Thus, it will be perceived, that after the copartnership between Darling and Bacon was formed, just double the number of vessels were condemned, &c., as were before the copartnership be¬ tween Darling 6s Bacon existed. RECAPITULATION. SHIP. BARK. BRIGS. SCHOONERS. I 1 18 10 —total, 30. _ Now, of these vessels, which were so condemned and sold, Dar- ling and Bacon bought, at their own sale, the schooner Julia Ann, and “ directly and openly ” the brigs Galveston and Pedraza, which ves¬ sels they afterwards, had repaired at Nassau; the two latter, no doubt, by Finlayson, whose charges for the same to the new owners were “moderate and fair,” but to the underwriters the estimated re. 5 pairs exceeded the admiralty-rule, and therefore these vessels were condemned and sold as unworthy of being repaired for the original owners or the underwriters. These vessels made voyages several years afterwards for Darling & Bacon. Again, among other of the above condemned vessels, is the schooner Hudson, schooner Ann Still, brig Francis, and bark George Henry. 'The schooner Hudson was bought by British sub¬ jects, was by them afterwards repaired in Nassau, no doubt also at “moderate and fair” charges, and, after having been repaired, was sent to New York, was there sold, and obtained a new American Register, and from the time of her condemnation in March, 1845, to the 26th of January, 18.50, [at which time she was “ lost” on one of the Bahama reefs,] she performed voyages,—being for nearly Jive years after her condemnation and sale. The schooner Ann Still was likewise repaired at Nassau after her condemnation and sale. She also was purchased by a British subject, and was converted into a brig. The brig Francis was likewise condemned, sold, pur¬ chased and repaired at Nassau, and made voyages for years after her condemnation. She also obtained a new American Register. The bark George Henry was also condemned and sold as unworthy of repair, and I find by Darling & Bacon’s own showing, set forth in their aforesaid pamphlet, [and sworn to, to give weight to asser¬ tion, by Daniel Sargent, the brother-in-law of Darling,] was “in the month of January, 1849,” sold by Darling & Bacon to “ Messrs. Palacios & De Ynza,” both of which gentlemen are British subjects. These gentlemen subsequently sold her to a gentleman by the name of John W. Finder, also a British subject, who subsequently sold her to the aforesaid Daniel Sargent, who subsequently sold her to Alfred G. Benson, Jones & Johnson, New York, and Charles T. Dilling¬ ham, the present master thereof, after which she obtained a new Register as an American vessel, since which time she has been per¬ forming voyages, and I am informed she is now on her way to San Francisco, California. These facts were in my possession previous to the publication of Darling & Bacon’s pamphlet, and they aho, by their own pamphlet, have confirmed many of the facts here set forth. That so many American vessels, together with their cargoes, were condemned and sold at Nassau, by Darling & Bacon, may appear surprising, is but natural; when the fact is known, that after the copartnership between Darling and Bacon was formed, there was united in said firm of T. Darling & Co., the Consulate, alleged agents for U. S. un¬ derwriters, and auctioneers. Thus it will be perceived that it was to their interest to condemn and sell every vessel and cargo which came there in distress, or reported to be in distress, in order that they might make their/ee per cent, commission as Consul and agents for underwriters, as well as five per cent, commission as auctioneers, being ten per cent, upon'the proceeds of sales of all vessels and cargoes, together with the opportunity, at the same time, of purchasing at 6 their own sales vessels and cargoes on specuhlinn, which they did in purchasing “directly and openly” the brigs Pedraza and Galves¬ ton, &c., and numerous parts of cargoes of these and other con¬ demned vessels, as well as of those which were wrecked, many of which cargoes they reshipped to the United States, on their own ac¬ count, and realized thereby large profits. This also accounts for just double the number of vessels being condemned, &c., after the partnership was formed, added to which fact, in very many in¬ stances, the masters of the condemned vessels were part owners of the vessels, and were fully insured in nearly every case, and the fact of the Consul and alleged agents for U. S. underwriters, making the disposition they did of them, was a sufficient guarantee that the master would have no difficulty in obtaining their insurance from the underwriters. These are some of the frauds which I found had been perpetrated at the Nassau Consulate by my predecessors, some of which, as I before stated, I was in possession of before I entertained the thought of making application to be appointed Consul at Nassau. These facts, after my appointment and arrival at Nassau, were again brought to my knowledge, and were subsequently confirmed by the investigation I made. Whilst engaged in making the investi¬ gation, Darling and Bacon had the assurance (througli several of their friends who figure in the pamphlet as their warmest advocates,) to make to me offers of the most advantageous and lucrative kind, hoping thereby to seduce me to iheir party, and win me to their con¬ nections. This I declined doing. Having failed in their attempt to corrupt me, they then aimed at intimidating me by persecution. Such was the state of things existing at Nassau when I assumed the duties of the Consulate on the 1st of November, 1849,and although 1 was on the Island but a short time, as they state, yet I was there sufficiently long to discover who were honest and conscientious men from those who were directly the contrary—to discover which fact does not require much penetration or any length of time any where, but especially in Nassau. Finding that the fatality spoken of existed exclusively among Ameri¬ can vessels, I asked myself the question—Why could not American vessels putting into Nassau in distress, or those reported to be so, be repaired there in like manner as British and other vessels? Why could not those vessels which were condemned and sold as un¬ worthy of repair have been repaired by the alleged agents for the Underwriters before they v/ere condemned and sold? When, «/