Part 8

In various ways the special agent found opportunities, even without seeing the books of the bank, of demonstrating to his satisfaction that the accounts were being juggled. This was particularly true of new deposits. When a cashier is particularly hard pressed he may resort to a manipulation of the accounts of current depositors. The system is the simplest in the world. When a depositor hands in his money, the cashier enters the amount in the pass book of that individual as a receipt. Then, instead of entering the money to the depositor's credit, the cashier puts it into his pocket. Thus there is nothing to show for the transaction but the entry in the pass book, and that may not be presented for a long time. The cashier chooses for spoliation the accounts about which inquiries are least likely to be made. As far as the books of the bank are concerned they are as though the deposit had never been made, and the bank examiner, therefore, has no way of discovering the shortage.

Gard, through the store for which he worked, made several deposits, and, upon one pretext and another, sent to the assistant cashier of the bank for the record of them in the absence of Compton. They did not show on the account of the grocery store and the matter was passed over as a misunderstanding. But a second avenue of misappropriation thus was discovered.

In this way the special agent was able from the outside to get very good leads into the condition of the bank and to determine the manner of its looting when the facts might not have been obtainable by an expert working from the inside.

Gard's case was about completed and the Department was ready to act when the dramatic denouement came. Arson, suicide and flight are the three events most to be expected when the funds of a bank have been misappropriated. The young special agent was watching for any of these at the time of the anniversary party given by the banker. It was in preparation for any of them that he watched so late on that occasion.

On the afternoon which preceded the entertainment Gard was working over his books at the store and at the same time keeping an eye on the bank. An hour after closing time at the bank he saw Compton come out of the side door with two books of the institution under his arm. He could make out that one was loans and discounts. He surmised that they might be records that were to be destroyed--probably the books that showed his guilt.

When from the hillside Gard that night saw the silent car stop back of the bank and the flames subsequently break out, he knew what had happened. These were accomplices of the cashier who had probably looted the bank of any remaining funds and, according to agreement, had set it on fire that the incriminating records of the cashier might be destroyed. The wily cashier, however, had made sure that the books that showed his guilt would not be found, in case the plan was not an entire success. He had removed them himself, but had not as yet destroyed them for he saw no probability of coming under immediate suspicion. Likewise had he neglected to destroy certain correspondence that later connected him with the parties found to have committed the arson.

The books taken from the banker's house were found to be the personal ledger wherein should have been entered deposits, and the loans and discounts ledger in which account Compton had entered the amounts representing all his personal checks. This latter was the account that had dwelt in the mind of Newton, the bank examiner. The letters that Gard had found in the banker's pockets, though unsigned and mysteriously phrased, were later traced to the Dutch Shroder gang. They proved a great aid to McCord, the plain-clothes man, who had slept peacefully through all the clamor incident to the burning of the bank, but who, through them, was able to trace the burglars.

Compton went to pieces when confronted with the proof that his derelictions had been found out. When his townspeople came to know the facts on the following day, they stormed the jail and threatened to lynch him. So determined was their onslaught that the sheriff spirited the prisoner away. In desperation he confessed his crimes and exonerated Lorance, the assistant cashier, who in playing the market had only executed the orders of his superior. Compton lived but six months after his conviction and sentence to ten years in the penitentiary at Atlanta.

VIII

BEHIND CUSTOMS SCREENS

The effrontery of this special agent, you would quite naturally conclude, was ridiculous. You approve of the sort of courage that makes a man willing to tackle almost any big task, but you also recognize the limitations of the individual. David with his slingshot had an obvious chance of success. If he could make a scratch shot and land on the coco of Mr. Goliath he would win. But Special Agent Billy Gard sallied forth nonchalantly against the whole army of Philistines, apparently without even a slingshot.

The Philistines in this case were typified by the customs crowd of the port of New York. That crowd was a ring within the administration of the affairs of that greatest of gateways that had built up a system for diverting a million of dollars a year from the pocket of Uncle Sam and appropriating the money to itself. For twenty-five years the men of this inner circle had steadily strengthened their positions, their hold upon those in authority, their power to shake down importers. There is a great influence to be wielded by a million dollars a year in the hands of willing spenders.

The development of this condition of affairs was based primarily upon the fact that positions in the customs service are dependent upon politics. The men who built up the system of customs graft had secured their appointments because they had political influence. They afterward used that influence and put their easy money back of it. Their power grew. It made it possible for them to dictate appointments more important than their own, even to the collectorship itself. It made it possible for them to bring about the removal of any smaller official who seemed to stand in their way. Men not in the ring learned to wink at many things that they saw. When an emissary of the crooked customs crowd went to an importer, even where he was honest, it came to be known that it was wise to listen to any proposal made. Thus did the machine gather force.

Just one example of the workings of the system. An Italian named Costello was an importer of cheese. He was a successful, enterprising and honest merchant. One day he received a large shipment from Italy, upon which he expected to pay a duty of $10,000. The cargo was unloaded and weighed by the customs representatives. That night an emissary of the ring called upon the Italian merchant. He showed the record of weights for the cheese cargo. According to this record Costello would have had to pay a duty of $5,000. It showed but half the weight in cheese that had actually arrived.

"We save you $5,000," said the spokesman. "We expect you to divide the profit."

"But I believe in dealing honestly with the Government," said Costello. "I have always done so and I have prospered."

"My tip to you," said the go-between, "is to do as the weighers suggest. They could as easily have charged you overweight as underweight. Besides, you will save much money."

The importer, a foreigner, thus advised by representatives of the Government of his adoption, took the tip and thereafter profited through this official corruption and shared the duties thus saved. Costello received most of his goods as part of what were known as "Mediterranean cargoes," cheese, macaroni, olive oil. The Government was afterward found to have been losing an average of $20,000 on each Mediterranean cargo that came to port.

The case is typical. The representatives of the Government practically forced the importers into these deceptions. The customs service and commercial New York became permeated with this sort of fraud.

Henry L. Stimson was appointed United States district attorney in 1909 and determined to clean up these customs frauds. William Loeb, Jr., was collector of the port, and of the same mind. The two men got their heads together and considered ways and means. A big cleanup followed and in bringing it about the work of Detective Billy Gard played a most important part.

This young special agent was told to go out and master the detail of New York customs, a service that was new to him, to come to understand them so well that he could place his finger on the points where things were going wrong, to pick out the men in the service who were corrupt, to get his information in such form that it would be admissible in court as evidence and so strong that it would insure convictions. He was to do all this in the face of the unfriendliness of the service he was to study, despite all the stumbling-blocks that would be put in his way, in opposition to the dominant political machine of the port, in the face of a lack of any special knowledge of the service. Young Gard accepted the assignment with a grin.

"What are you doing on the customs cases?" District Attorney Stimson asked three weeks later.

"Going to the baseball games," said Gard.

"I hadn't noticed any cargoes being unloaded out that way," said Stimson. "How long have you been a fan?"

"Just a week," said the special agent. "Never attended a game before in my life. I sit in the nice, warm sun of the bleachers to the right among the fanatics. I have learned to keep a score card already."

And such were actually the facts. To solve the riddle of the customs frauds Agent Gard was working hard at the task of becoming a baseball fan.

Two weeks he had devoted to the docks. During the first of these weeks he had gone from wharf to wharf and from man to man. He had asked many questions which were but the common places that any individual who wanted to get a smattering of the detail of such a business would have asked. He was received tolerantly by the old heads of the customs crowd. Many agents had been to the docks ahead of him and most of these had been experts. If they began to get dangerous, political influence was used in having them pulled off the job or money was used in having them fail to report any wrongdoing. But this youngster who did not know the simplest things about the customs service--he was hardly worthy of notice.

But during that week Gard had not expected to become a customs expert. His plan for getting results was founded on a different idea. He had been hunting for a man who suited the purpose of his plan, and had found him. This man was an Irishman by the name of O'Toole, who was one of the weighers at a certain dock in Brooklyn. He had in the back of his head all the facts that the special agent lacked. If he could be induced to cooperate, the case might be worked out.

O'Toole was a man of fifty, and had been a weigher for eleven years. Gard had learned many things about him. He had no family, his great enthusiasm was baseball, and his weakness was a certainty of going to the mat with John Barleycorn every third Saturday night. He was a lonesome man, and sour and cynical.

"How long have you been on this investigation?" O'Toole asked Gard before the conversation had gone far.

"Just this week," said the special agent.

"Have you found anything?" asked the weigher.

"Not yet," said the special agent.

"Well, if you want your job to last, don't," said the Irishman.

They discussed the general points in the business of weighing cargoes and the work of the force having it in charge. But the special agent had gathered the idea that O'Toole was not in sympathy with conditions, that he was not a member of the inner circle. Yet an intelligent man serving as weigher for eleven years would know secrets that would be of interest to the Government, and O'Toole was embittered. He should be cultivated.

The days of the following week the special agent spent about the docks dressed as a rough laboring man. The nights he spent in nearby saloons with the acquaintances he had made during the day. The idea in this was to determine what information the laborers were able to pick up and whether they could be used as informers. Many of these were Irishmen, as smart as the best of them, and pretty well aware of what was going on. From the gossip of these men it was also possible to get many a flash on the character of the men higher up. O'Toole they pronounced honest.

"They won't give him a chance to get on the inside," said one, "because they are afraid he might talk when he is drunk."

"He wouldn't take dirty money, anyway," insisted another. "He is an honest man."

The third week the special agent was devoting to the ball park, sitting in the bleachers three seats back of O'Toole. He had determined that the Irishman should tell him the story of the customs frauds from the inside. He knew that, to get on a basis of sufficient good feeling to bring this about, he must approach O'Toole on the most favorable basis possible. Too much care could not be taken in laying the foundation for his final proposal to the weigher. The man's love for baseball first presented itself. The agent determined to become a fellow fan with him. Thus should he come to know him better and under most favorable circumstances.

On two occasions the special agent bowed to the weigher in leaving the bleachers. He had thus got himself identified in that individual's mind as a fellow fan. It was the end of the second week, however, before the conditions developed that made just the opening that Gard wanted. The situation worked itself out on Saturday afternoon. The game had gone three innings when a flurry of rain threatened to bring it to a close. Then there was a downpour. The people in the bleachers scurried for shelter. There seemed little chance for the game being resumed, and most of the bleacherites filed out under their umbrellas.

Some twenty enthusiastic fans held to their seats on the chance that the game would go on. Among these were O'Toole and the special agent. Both were drenched to the skin. Finally the umpire announced that the game was called, and the stragglers turned homeward. As O'Toole started to go he was greeted by Special Agent Gard.

"By jove," said the young man, "I believe you are a more enthusiastic fan than I am."

"They shouldn't have called the game for a few drops of water," complained the saturated weigher. "But let us go some place and get a drink."

Whereupon the two dripping fans found their way to a nearby barroom and talked of club standings and batting averages while they warmed up with copious drafts of red-eyed liquor.

"Boy," said the weigher, after the fourth drink, "have you got a family?"

"No," answered Gard. "I am not married."

"Go get married," urged the older man. "When you begin to get old and have only a solitary room to which to go and no children nor grandchildren to give you an interest in the world, there is nothing to live for. You perform your small duties with a great void in the back of your mind. There is no stage setting that makes the petty play seem worth while. The only relief is an occasional Saturday night when you forget."

The special agent began to realize that the weigher was starting on his tri-weekly fling. It also began to be evident that he was of the order of inebriates who indulge in a debauch of self-pity as an accompaniment to their liquor.

"It always seemed to me," said the special agent, "that a man could become so absorbed in his work that it would fill his whole life. Particularly should this be true when he has a task so important as yours."

"Mother of Mary!" exclaimed the Irishman. "Become absorbed in watching a bunch of thieves always at work? Would you like to spend your declining years in sitting idly by and watching your employer and benefactor robbed?"

"Why do this?" said Gard. "Why not lay the whole thing before the right authority and do a worth-while piece of work in cleaning up the service?"

"Yes, and be broken and thrown into the discard to starve," was the reply. "I have seen too many of them go up against the gang. None of it for O'Toole.

"Just one tip I will give you," said the weigher after hearing the special agent's argument in favor of lending his aid to showing up the frauds. "If you will examine the records of Mediterranean cargoes you will find that, during the past ten years, such cargoes have regularly been about twice as heavy when handled by certain weighers as when handled by others. The men whose records show these cargoes always light are the crooks. Those who show them heavy are honest. The solution is merely a matter of mathematics."

With this semiconfidence the agent contented himself. He continued to go to the baseball games, but met O'Toole only casually. In the meantime the records of weighers were being examined. In a week the figures were complete. They showed these men divided into two groups that were far apart with relation to the weights of cargoes. The group that weighed light was the larger.

A few days later Gard saw O'Toole after a ball game. He told the weigher that District Attorney Stimson wanted to see him that night at the Federal building, that the district attorney was under great obligations to him for the tip to examine weigher's records and wanted to thank him.

"O'Toole," said the district attorney that night, "this is a time when the Government needs the aid of honest men. We know that men who would clean up customs graft have, in the past, come to grief. But this is not now true. I have taken up your case with the Secretary of the Treasury himself. That official asks me to inform you that, in case you aid us in cleaning up this situation, your place will not only be made secure but that you should figure that the service will be remembered in the light of your future interests. We know that your record is clean. We want your help. Are you with us?"

Agent Gard had selected the right man. O'Toole, at first timid in his fear of the ring, became an enthusiast over the task of weeding out the graft. The dominance of local politicians had no terrors for him with Washington at his back. The value of all he had learned in eleven years at the scales was made to supplement the lack of customs experience on the part of the special agent. His acquaintance with the customs force in the port made his information invaluable. So enthusiastic did he become that he missed three ball games in succession and went past four Saturday nights without his customary tussle with the spirits that bring forgetfulness.

O'Toole confirmed much of the list of short-weight employees that had been made up. Of the derelictions of many of these he had personal knowledge. With their methods he was entirely familiar and was able to point the way toward the establishing of guilt so it would be admissible as evidence and would secure convictions.

That an individual weigher may report short weights it is necessary that his associate at the scales, a checker, should share in his deceptions, for the checker is a witness of the record of the scales. In the celebrated short weight cases of the sugar scandals, the checker had a steel spring like a corset stay that he thrust into the mechanism of the scale and retarded it, thus resulting in a showing of short weight. But in the case of the Mediterranean cargoes the fraud was less disguised. The scales were allowed to record the proper weight, but the weigher and the checker, in collusion, divided the figure by two in setting it down. The system was both simple and effective. It worked for twenty-five years.

Gard consulted with O'Toole upon the advisability of using workmen about the docks as informers. The weigher thought this could be done and knew a number of men who might be so used. A laborer, for instance, working about the scales, was able to see the amount that the beam registered at given times. He could easily remember the big numbers, those that represented the thousands of pounds, until he had a chance to set them down. He could thus get a rough record of the weighing of a given half day. This could afterward be compared with the figures of the weigher. A pretty close check could thus be put on the given suspects.

By such methods fairly clear cases were obtained against given weighers and checkers. After much information was gathered certain guilty men would be selected who would be given chances to tell all about their knowledge of the frauds. These men would be given immunity. Thus would a few of the guilty escape punishment; but thus, also, would the Government learn all the details of the frauds that it might be able to provide effectually against them.

Special agents were set to watch every suspect, to learn his manner of life, how he spent his money, whether he could be trapped on the outside. When the Government needed the confession of a given man he would be called upon and talked to in some such manner as this:

"You, as checker, worked with Weigher Smith on a given cargo. The weights shown by the scales Smith divided by two and you passed them. That night a messenger was sent to Costello with a statement of the short weight he had passed. Costello paid half the duty on this short weight. You and the weigher split on the basis of forty, sixty.

"We know of a score of offenses equally glaring on your part. The Government needs you as a witness. Under the circumstances do you not think it would be advisable for you to go with me to the district attorney and make a complete statement of all you know about customs frauds?"

The man that the Government wanted usually came through with all he knew. So were the cases made absolute and so were all the methods of graft revealed. Eleven weighers and checkers were convicted and sent to the penitentiary. Many hundreds of thousands of dollars in duties that had been avoided were assessed against and paid by importers. The Government was lenient with most of these because of its chagrin over the part played by its representatives and because the initiative in the offending had usually been taken by Government agents.

Altogether the cleaning up of the customs scandals in the port of New York was a most complicated task. The work of Special Agent Gard is but a fragment of it, but was vastly important and decidedly typical of the problem in hand and its solution.

IX

WITH THE REVOLUTION MAKERS

The Isla Dolorosa is in the Rio Grande River a few miles below El Paso. It is Mexican territory and is owned by an aged ranchman named Jose Encino. If one should start a camp fire anywhere on the island he would be running a monstrous risk, for so great is the quantity of ammunition that has been smuggled thus far on its way to revolutionary war and buried, that any such fire might cause a huge explosion.

It was in the moonshine of a clear November night in 1911 that a boat drifted down the Rio Grande from the American side, pulled up among the cattails of the north shore of the island and was beached beneath a great cottonwood tree that stood out against the sky as a landmark. Two men stepped ashore and waited in the shadows. Fifteen minutes later two riders splashed into the water from the Mexican side, floundered through the stream that but came to the stirrups, and pointed the noses of their horses for the same huge tree. Nearing it they halted.

"Reyes," said a voice from the darkness.

"Gomez," responded a rider.