AMERICAN CUSTOM HOUSE FRAUDS.

Westport Times, Volume IV, Issue 656, 10 May 1870, Page 3

AMERICAN CUSTOM HOUSE FRAUDS.

The periodical recurrence of Customhouse frauds (remarks the United States Economist) divests them of the novelty that formerly attached to them and now the interest narrows down to the question of the names of the parties implicated, the amount of their " pile," and the means by which they may contrive to evade punishment. This time officials high in the public service are said to be involved with merchants of some considerable standing, and we are informed that the frauds amount to over 1 >OO,OOO dols. in the drawback department alone. Then there are frauds in the appraiser's department, amounting to no one knows how much. And besides these, there are comparatively petty embezzlements in the weigher's department, in the shape of salaries to bogus officials. The " drawback " frauds are the most important of the recent discoveries, and the largest in amount. The revelations, so far, are to the effect that certain parties conceived the idea of securing a repayment of money alleged to have been paid on American manufactured goods, on the .plea that they were intended for exportation. This was accomplished under the law exempting goods for the foreign market from taxation. For instance, the swindlers would procure from the revenue collector of, say, the New England district a certificate of the amount of internal revenue and duties paid on a certain amount of goods. They would then cook up an affidavit from some man of straw that he had puchased the goods upon which the taxes had been paid, and exported them in certain vessels to a foreign port. The bogus papers would then be sent on to Washington, and after certain circumlocutions, and a few more affidavits, the money would be paid by the Treasury Department. In this way bogus goods would be purchased from bogus manufacturers in various parts of the country, and shipped off on imaginary vessels. The only genuine thing about the affair was the money received from the • Treasury on false pretences. This money, District Attorney Pierrepont alleges amounted to considerably more than 1,000,OC)0 dols. The precise , amount can probably never be known.

It is not always possible to separate the bogus from the genuine transactions of this kind. It is only known that the connivance of a certain resigned but missing functionary, whose services were needed, was secured by a commission of 10 per cent., on all frauds. One instance has come to light where this functionary shipped on one vessel sufficient heavy ma. chinery to sink three vessels. These bogus mercantile operations included sewing - machines, clocks, clothing, boots and shoes, machinery, steam engines, almost all the few thousand articles in the manufacture of which dutiable articles are used. The West India and South American trade is the source of somewhat different frauds. Opium and costly drugs upon which the duties are imposed are shipped to Callao, Valparaiso, and other ports in Peru and Chili, where the officials are as lax as our own. The goods would then be forwarded to Panama, where the shipper's bonds would be cancelled under "a landing certificate." They would then be placed in cases and trunks, marked " Through baggage from San Francisco to New York," and would be passed here by convenient officials. The Isthmus seems to be a leaky place. High wines and liquors have been shipped in bond, from San Francisco to New York, and during the transit from Panama to Aspinwall have been converted into water or very low-priced liquor that scarcely paid the cost of shipment. Then there is the inevitable fraudulent invoice system, and the shipment of costly silks, velvets, and jewellery in cases marked " cotton goods ;" and their passage through the Customhouse here through the connivance of the appraisers in secret. These frauds are constantly going on. If detected, as they are occasionally, the importers turn out to be men of straw, put forward by more respectable parties, who evade punishment. In the weigher's department, the frauds, to the amount of 1,000,000 dols., are of a still different kind. A cargo of two million pounds of coffee is returned as a million and a half. Sugar loses twothirds of its weight, and three-fourths of its value. Molasses barrels lose one-third of their contents. A bonus to the easy-officials, and the thing is done. All these frauds tend to explain the mystery of how speedily a 1,200 dols. Custom-house official contrives to own one or more brown stone fronts in this city and Brooklyn, after only a few months' term of office.