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About The Omaha morning bee. (Omaha [Neb.]) 1922-1927 | View Entire Issue (March 22, 1924)
Big Bribe Paid j * for Permits to Withdraw Rum N. Y. Druggist Testifies He Gave William A. Orr, Friend of Jess Smith, Money for Papers. — By Aiworiafrd Press. Washington, March 21.—Unfolding a new maze of startling charges hav |!lng to do with Illicit withdrawals of ] whisky in 1921, and which Involved - payments aggregating $200,000, John ! Goronl, president of the Alps Drug company of New York, today told •the Daugherty committee that the money was ‘'split" six ways. ; In hrlef, Goronl’s story was: ; ■ Fifteen dollars a case was paid for permits to withdraw the whisky. '• The $15, he said, was "split" this j way: i Four dollars a case to the prohlbi J tlon director (in 1921). i Two dollars a case to Howard Man I nlngton, one of Attorney General t Daugherty’s friends who had an of " fice In the “little green house on K i street. 1 One dollar to the druggist In whose , name the whisky was withdrawn. I One dollar to Goronl. ^ ' Fifty cents to Assistant United a States Attorney L’Esperanlo of New l York. * Six dollars and a half to Will A. i* Orr and Owen Murphy. Mannlngton had to split his $2 ♦ three ways, Goronl said Orr told him, ! and that some of It went to the late ’ Jesse W. Smith, Attorney General Daugherty’s bumper and friend. • ANYBODY - COULD GET RUM. After the drug companies got the ' permits anybody could get the liquor. The $1 fee was for the use of drug ‘ companies' names, he said, to get the ' permits Into hands of bootleggers. * A man named Paul Lundy, the jgtrlcal agent, told him In New York. * Goronl said, that If he wanted to do *• • business he should "see Bill Orr." “Did Orr tell you anything?" ' "He said he had Influence In t Washington with Mannlngton and Jesse Smith and I would be protect : *d. I met Jesse Smith with BUI Orr." "Did they tell you Smith was the man who could fix things?" "They said he could help a lot." •'Mannlngton," Orr said, "was getting $2 a case from every case that went through." Goronl testified that the prohibition i directors had refused a withdrawal ap * plication for 500 cases of liquor and OrT had told him that the "influence and power” he and his partner, Owen B. Murphy, had with Jess Smith i and Mannington would arrange for granting It. j "Who did they say Howard Man * Blngton was?” "They said he belonged to the Crowd from Columbus." Goronl said he came to Washing . .ton when 7,000 cases of scotch were J fcelzed. 1 "Whom did you see?" !, "Thomas B. Felder. He told me to home—It would be all right—ho ; would get the liquor sooner or later." !" "Did you pay money to Orr?” IV "Once—$50,000, In 50 $1,000 bills.” ! "Where did you get it?" I) “From John Lynn.’ !, “What did you get the $50,000?" !' “It was a balance that Lynn owed ; to Orr and Murphy on liquor with drawals.” j "I was running the business for five drug companies,” Goronl said, j naming the Central, the S. and H '"Drug company, the Alps and others. .*•' “Was this $60,000 paid to" fix things?" "Orr was selling permits for $16 a ! case, and each of my drug companies was getting $1 a case back from Orr.” "Did you pay any more?" . "To Murphy I paid about $150,000.” PAID $200,000 FOB WITHDBAWALS. "That was for Influence.” “It was for these w'thdrawal ■ papers.” ?>r "When was It?" "From May to about.August, 1921." "In those three months you paid Orr and Murphy $200,000?" 1;’ "Yes.” , "That was for liquor?" "No, for permits." "And you were not able to get any ' permits without that?" i ; "No." "This $150,000 you paid was boot * Jeggers' money?" Senator Jones "•sked. "Yes sir. •( "You were paid bark some money j from Felders' offices?" !, "Not me—Some people were—I In 1 Slsted that Orr give It back to me." f . "Did you meet Mannlngton?" >" "Yes—In Murphy's office in New jYork." I*! "And they told you he was the at ‘ torney general's friend?" fc; "They didn't specify the attorney general. It was the 'Columbua !',crowd.' ’’ !,• "What did they say ns to Smith." ’ ; "That he was In the attorney gen* cral's office." e';i "Didn’t you offer to turn state's !;<|yldence?” (This referred to Ooroni’s ■trial In New York with Orr for con ■piracy on liquor charges. Both wore acquitted.) Goronl said he had not. “Did what you tell today come out then.?” "No, the district attorney and the prohibition director claimed the per mits were stolen." 1 "Did Howard Mannlngton turn hack some of the money? How much Kras paid back?" ''."About $40,000 or $50,000—It was paid through Thomas B. Felder." •j Goronl Indicated that the permits Were "Called back and cancelled through Haynes." ' "Some permits went through?" ►f "Yes. about <0,000 cases." "At $15 per case?" “Yes.” "You had throublo with Felder?" !. "Yes—I paid him $5,000 with a promise I would not be Indicted. I asked for my money back when I wns Indicted." " "W. J. Flynn recommended Felder ■ft) me—mild he was an honest man," remarked Goronl. The committee Identified Flynn as former head of the secret service. Goronl said he Imported 7,100 cases of Scotch whisky from Scotland “In a legitimate way," but that "TV. J. Fallon, the distillers' agent," wanted him to sell it to bootleggers. "He offered me a quarter of a mil lion dollars," Goronl said, "to sell that to bootleggers. I refused. The whisky was in the White Star ware house. Heillironner & CO., exporters, tried to get possession of it. They failed. After that they came to me Vith Felder and said they would give me $42,000 to ship the liquor back to England." Then Felder threw him out of his office, Goronl said, because he re fused to accept the $42,000 to relin quish his claims to the whisky. SAME KIND SELLING AROUND N. Y. There was litigation and "by order of the attorney general the whisky was reshlpped to England." Goroni tried to stop that unsuccessfully. "Did you have any information as to what actually became of it?" "The same kind of whisky, in bot tles and cases, was selling hy the bootleggers around New York.” He was not positive the bootleggers' whisky was his own, but “It was the same brand and that kind had never been there before." "What did you lose?" "Between $30,000 and $35,000—litl gation and all.* The 7,100-case shipment was sent to the Alps Drug company, Goroni explained, and he had a permit to export It. "I did not pay anything for that permit—it was a legitimate transac tion," Goroni said. "Orr came to me,” Goronl went on. “I wouldn't give up the shipment. He told me to ge to hell.” This was In June, 1921. "Didn’t you know that the goods were never reshipped outside the port of New York?” "I know the rumor,” Goronl said. "There was a plan to steal it from the warehouse—and I got detectives to watch It. Then it was ordered re moved to the concentration warehouse, where the bootleggers have every thing in their power, and I couldn't stop It." From the concentration warehouse the 7,100 cases were ordered to re shlpment. "I changed my attorney—went from Felder to Barnes," Goronl said, telling of his fruitless attempts to stop the reshipment. His attorney told him, he said, that Gaston B. Means would go from Washington to New York, acting for the attorney general, and stop return of the whisky to Scotland. Means got there Monday, but the whisky moved out Saturday. Goronl said he was told that the whisky fees ($15 a case) were divided as follows: Two dollars for Manning ton, $2 to the druggist, $1 to myself, $4 to the prohibition director, 60 cents to a lawyer named I/Esperanlo, and the balance divided between Orr and Murphy.” California Wife Hunter Here in Spring to Give Eligibles Once Over Three Hearts Already Pining £or Love Nest Among Orange Blossoms. "An Orange Grove in California” ha* been the favorite song of several Omaha, Nebraska and Iowa girls since last December who responded to an appeal of Arthur Paul Gaffke, I.os Angeles, for a wife. Three responses are on file in the office of Clyde Sunblad, sr.. in the court house. Sunblad acted as the bureau for the wifeseeking Califor nian. Sunblad spread his appeal broadcast, and Miss Kathryn Gottsch, Omaha; Miss Minnie Skinner, Lincoln, and Mrs. Petra Lyman, Dow City, la., re sponded at willing to entertain mar riage with the Californian. Recently Gaffke advised Sunblad by mall lie will visit Omaha in May to view his prospective fiances. Ac companying the letter was one from George Fisher, who declared he had known Gaffke all his life and gave Arthur i'uul tiaffke. high recommendations as to his char acter. McAdoo Here Silent About Dolieny Deal Democratic Presidential Can didate Tells How He Longs to Be Back in California. William Gibbs McAdoo, happy over his •'victory" in Georgia, spent two hours in Omaha Friday morning. He arrived at 7:45 from Sioux Falls.2S. D., and left for his home in California at 9:40 yesterday. The oil scandal, all Investigations, the Fordney-McCumber tariff bill, the revenue law of 1921, the needs of the farmer and almost every other ques tion which has come before the pub lic recently was mentioned by the democratic candidate for president. Everything republican was de plored by Mr. McAdoo. He attempt ed to point out the benefits enjoyed by the country during his term as secretary of the treasury. But he declined to comment on the charges made against him by the senate dur ing the Teapot Dome investigation. No remark was made as to his con nection with Doheny or any other oil man. McAdoo expressed only two desires other than to be elected president of the United States. One was to find breakfast at once and the other was to be bark in California. T. C. Byrne and Dr. J. Ray Byrne formed the reception committee for Mr. McAdoo. Arrangements had been made for breakfast at the Omaha club and the party left the station at once. McAdoo is now engaged In a cam paign that covers the states in which primaries will be held soon or have been held recently. McAdoo refused to comment on Wil liam Jennings Bryan's statement that he was not good •'party timber.” "Yes, X think Mr. Bryan Is a fine man," he remarked when questioned. Death Beats Court in Fate of Slayer Tankton, S. D., March 20.—George Cooley of Tabor, S. D., who was tried and convicted last year on a charge of murder and who was at liberty on an appeal bond while the supreme court of South Dakota was reviewing the case, has escaped prison portals by entering death's door. The convicted man's death oc curred today following amputation of an arm. which was Injured while Cooley was working on a farm near Tabor. Cooley was convicted of the murder of Mrs. John Mudloff. an aged woman of Tyndall. S. D., and given a life sen fence. __ EDWARD REYNOLDS 1613 Farnam Street Awaiting You Here Saturday Are Omaha s Greatest Values in C-O-A-T-S Style distinctiveness individualizes each number. Coats you’ll be proud to wear and anxious to buy because we have priced them at only Graceful in their lines, mannish in ap pearance. Richly lined with canton crepe. A diversified style range. All wonderful values. Plain Coatings Shadoiv Plaids Blanket Plaids Novel Stripes Smart Checks Edward Reynolds extends to you the privilege of a charge account. You will find it convenient in many ways. rniniwmiiiiiiwwBimimBiHigiiitmmHiHBWWiiBmwgMtinifliiBigLiwaBmflnininiif'nrtiitiitiffia On Saturday—Many Will Choose Their New Spring Tailleur Clever New Blouses $1.75 Overblouse styles, with gauntlet cuffs; the ideal blouse with the mannish suit. A splendid variety at this attract ive price. And where is the woman who does not dwfce one of these trim suits? A most appealing display Saturday at Suits with that care-free, boyish-style gracefulness. Suits that are striking in their simplicity of style and beautiful tailoring. Plain twills or novel checks and chalk stripes. AH the favored colors. •<fc Holds Goal of Probers Has Been Reached Challenges Hody's Authority to Proceed After Validity of Leases Passed on by Reso lution in Congress. By A*snciat*if Pr#M. tVafthington, March 21.—Counsel for Harry F. Sinclair waged an in conclusive fwo-hotir legal baffle with the oil committee today in an effort to have their rlient excused from further questioning. Challenging the committee's an thnrit.v to proceed with the inquiry after the validity of the leases had been passed on in a resolution of con gress, and contending that in "fair ness and justice,” Sinclair should not he compelled to testify while charges of fraud are pending against him in file courts, Martin \\. Littleton of the Sinclair counsel told committee mem bers that their course was a "mon strous proposition," and an “outrage.” Senator Walsh did not agree with the Sinclair attorney but some com-' mitteemen wanter more time to think It over and adjournment was taken without a decision. The argument will be resumed tomorrow. While today’s discussion was in progress Sinclair, whose lease of Teapot Dome was the starting point of the oil inquiry, sat at the com mittee table, apparently confident that he would be excused. LEGISLATED LEASES VOID. Littleton contended that by the reso lution congress not only had brought to an end the jurisdiction of the com mittee, but had "defined the policy of the government that the oil shall be preserved for the government." “You have passed upon the validity of these leaseH,” Littleton said. "And as far ss the legislative adjudication can be effective you have legislated the leases to be void and have legls latively imposed an injunction with regard to the property. "You have established a policy ot tha government on thla subjectj and anything you claim would he only a detail which would not warrant the further examination of my client in th(# matter. “You not only say that the leases were void, but the language you use is very broad and the policy you have established Is very definite. You have declared the policy of this gov ernment Is that the oil should be maintained In the ground as a great reserve supply to meet a national emergency. You have thus dis charged nil the duties placed in ypur hands. "What is it your committee Is In vestigating that entitles to take my client, who has been here time and again with his books and papers, and say, 'You must testify further’?" “ALL DUTIES ARE DISCHARGED." Have you any Jurisdiction which entitles you to do so under the stand ards and precedents of the American government." The right of congressional com mittees to call w Itnseses and papers from all over the country to aid In framing legislation, the attorney argued, never had been sustained by the courts. "Has It ever been denied?" asked Senator Walsh. “No, but It has been questioned,” was the reply. There was a long colloquoy between Littleton and senators as to the rights cf congressional committees to sum mon witnesses. Sinclair s rounse1 con tended that the committee was vith out power. "If your ideas snould prevail," said Senator Dill, democrat, Washington, "this committee might as well close Its doors and quit." "It should either quit or do its work in a constitutional fashion." replied Littleton. "As I understand Mr. Littleton's position," said Senator Walsh, "it is that members of congress are obliged for the purpose of Informing themselves concerning contemplated legislation to depend upon the press, their talks with individuals and other voluntary information w-hlch any body may be willing to give, but they rannot compel anybody to coma be fore a committee and tell It the facta.'" "Senator, your statement is face tious," Littleton said. “Oh, It is not," returned Senator Walsh, “It i* * statement of your argument.' AKGl'MKNT GROWS IIEATfCn. The argument grew more and more heated. Finally Senator Spencer, re publican, Missouri, suggested that the power of congress to compel at tendance of witnesses should be pass orl on as quickly aa possible. Little ton agreed. Calling attention that the govern ment had brought civil suit in Wyom ing against the Mammonth Oil company, In which fraud was charged against Sinclair, Littleton said this was another reason why his client should not be questioned further. "He (Sinclair) 1a personally charged in this bill (tha government bill of complaint) with a conspiracy to de fraud the government.” Littleton raid, “adding that it was doubtful that Sinclair could be compelled to testify even in a court because of that charge. As a matter of "fairness and jus tice," he said, “Sinclair should not be compelled to testify." Tho rules of evidence he said, are not observed by congressional com mittees. He declared he did not be lieve the committee had a right In law to go into a matter already be fore the courts and "prejudge the case.” Announcement of the government counsel that there is to be criminal prosecution, Littleton said, constitut ed another reason why the committee should not question Sinclair. He add ed that It was safe “to assume" from the charge against Sinclair In the bill of complaint in the civil suit that an effort would be made to have him indicted. ''What harm would be done to Mr. Sinclair if he testified, if he haa a just cause?" asked Senator Waleh. “Just the harm you would suffer If you were subjected to present your case before a mob In the street,” re turned Littleton. "Tou tell me you want to examine my client when he has been sued and may be indicted and compel him tn *n ,x P*rt* *,r°’ ceeding lo make a statement. "If ha la afraid of an indictment he has ample protection," said S*n-i tor Walsh. "Yea," replied the attorney, "you want to bring him before you and compel him to take refuge under the plea that lie might incriminate him seif." ■'Should we excuse him on that ground?" asked Walah. "You propose." Littleton returned, "to force us to the odium of pleading a privilege, of driving a man who has been driven to plead to a complaint In ihe courts and may be Indicted— that he must come here before the country and make the statement that he Is afraid of being incriminated. "You propose to drive him to that humiliation. It Is an outrage. A re \ersal of all traditions of the law." "We do not agree with that," said Waieh. _ it "It is a monstrous proposition." shouted Littleton. "We will meet you in the courts where you have sent us, and fight It out. Do not drive us Into a foul atmosphere and make a declaration which will throw odium on us to the ends of the earth." SENATORS ARGUE QUESTION. When Littleton had finished, Sena tor Walsh said Sinclair had been called for examination on "matters he might have testified about when he was on the stand before." There was an argument among sen ators as to whether the committee should decide the question raised in public or private. Senator Spencer, republican. Missouri, suggested an ad journment to study the matter, but Senator Walsh declared it unneces sary. Senator Bursum. republican, New Mexico, said he believed the commit tee "should proceed with the examin ation." Senators Kendrick, democrat, Wyoming, and Cameron, republican. Arlr.ona, said they wanted time to con sider it. Chairman Ladd declared he favored bringing the witness before the committee. Senator Walsh said hs wanted to give Sinclair every right that he would have in court, but hs did not think the question of "fairness, so eloquently presented to us," carried any weight. i Thompson-Belden g The New, the Irresistible is Here-andfor a Low Price Spring Coats of Style and Distinction $25.00 Sports coats of the newer type—beltless with loose back. Of polair cloth, plaided or plain, pocketed and lined, the majority of them with crepe. 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