In Kester he had a youth of twenty-four who had been born and reared in Royerton, had rarely been away from that town, had no interests out of it. He was a young man of good character, had demonstrated certain strokes of boldness and action. He had a mother and father and two sisters living in Royerton.
It appeared that Kester had fled and that he had cut all ties behind him—that he had left town and had never communicated with his relatives or friends. While Gard had been off the case a vigilant watch had none-the-less been kept upon all letters arriving in Royerton that might possibly be from the fugitive. No letters had come.
"Now, Gard," said the detective to himself, "were you a youngster of this training, living thus in Royerton, surrounded by a family to which you were devoted, with no interests in the world outside, with a certain element of boldness in your nature; if under these circumstances you got into trouble, would you run clear away and never communicate with your people?"
"No," he answered, transported back the few years that separated him from the inexperience of twenty-four. "I could not break so easily from my dependence upon my family and the only world I had ever known."
"And if you were thus thrown upon your own resources in the big outside world and had no money, and if you had the additional handicapof having to keep in hiding—would you be able to face a proposition like this and still not call for help from your people?"
"No," again answered the hypothetical youngster. "I would hide and find a way to get money and news from home."
So the detective reached the conclusion that Kester was, in all probability, communicating with his relatives. It was evident that he was not writing home. Too close a watch could be kept on letters coming to a small town for any of his people or their confidential friends to be receiving them without the knowledge of the special agents who, through the postmaster and letter carriers, had been steadily watching this means of communication.
So the conclusion was reached that Kester was getting messages to his people through some other means than the mails, in all probability through a confidential messenger. To do this he must be near by. He could hide to best advantage in a city. Philadelphia, Pittsburgh, Baltimore were in a convenient radius. The detective drew the conclusion that, were he in the boots of the fugitive, he would have taken refuge in one of these cities; that, had he notbeen willing to risk the mails, which Kester evidently was not, he would have used some trusty go-between and through that agency would have learned the news from home and received from his relatives the money upon which to live.
Upon the basis of this theory Billy Gard asked himself more questions.
"Were I hiding under such conditions whom would I use as a messenger?"
A faithful former servant who might be living there, a distant relative, some individual hired for the task. There were not so many possibilities. They might be exhausted in a few weeks' investigation. Was there not, however, a shorter road to results?
"If I were in this lad's place," the detective again queried introspectively, "what would make me write home?"
"Obviously nothing would," came the answer, "so long as I could communicate through the safer medium of a trusted messenger."
"But if the messenger were an impossibility, would I write?"
This query the detective had some difficulty in answering. He brought himself toexperience the lonesomeness and homesickness of the fugitive, the lad whose whole life interest was wrapped up in the little circle in which he had moved. At the same time he appreciated the fugitive's proven fear of the mails and his avoidance of them so far.
But for the sake of laying down a basis for action Detective Billy Gard granted that he would write if he could not communicate otherwise. If this were admitted what was to be done? Obviously the former methods of communication should be cut off.
How could this be done?
The messenger method of communication was possible only because the fugitive was near home. If he were far away it could not be used. If he were far away he would also feel an added degree of security. A worldly fugitive would not, but Kester would. With a continent between him and his crime the man who had always lived in this narrow sphere would not appreciate the possibilities of his capture. He would write.
Special Agent Billy Gard was quite sure of this. He would have done it himself at twenty-four. The runaway cashier should be capturedby being caused to flee thousands of miles further away.
Having reached this conclusion the special agent called Police Sergeant Flaherty on the telephone. Would Flaherty come to see him? Flaherty would be there in fifteen minutes.
Now Gard knew that Flaherty had grown up in the little town of Royerton. His folks lived there and Flaherty occasionally went back for a visit. The Irishman was a trustworthy guardian of the law and might be depended upon to carry out orders.
"Flaherty," said the special agent, "would you like to take a bit of a trip to Royerton over Sunday and see your folks, with all expenses paid?"
"Would I eat a Dago's apples when I was hungry?" said the policeman.
"Well, here is the lay of the land," Gard explained. "I am after that fugitive cashier, Kester, and I am going to get him. He is not far from home and his folks are in communication with him. I want them to know that I am after him. They will tell him, will supply him with a bundle of money and he will notstop running until he reaches Arizona. Then I will get him."
"Them are not police methods," said Flaherty. "I am not catching this dip, but when I do pinch them it is usually by getting close to them."
"I like to catch them on the wing," said Gard. "Anyway, you have merely a speaking part. Your talk is to the home folks, to the effect that I am hot on the trail of Homer Kester and likely to nab him at any moment. Go talk your head off."
Whereupon the policeman from Royerton spent the week-end at that village, had a good time and passed the word of warning.
Billy Gard waited ten days.
At the end of that time he was called on the telephone by the postmaster at Royerton. A letter had come to a sister of Homer Kester and in that young man's handwriting. It was postmarked "Spokane, Washington."
Gard despatched a long telegram in code to the special agent of the Department of Justice nearest Spokane, he being located in Seattle. He asked that officer to run over to Spokane and pick up his man. It was merely the task oflocating a well-described stranger in a comparatively small city. Two days later the Department was informed of the arrest.
"Psychology," said Billy Gard ruminatively, "is a great help to a detective—when it works."
Special Agent Billy Gard sat in the café of Fun Ken, that wealthy Oriental who had pitched his resort among the ferns of the Blue Mountains which look down upon Kingston, the capital city of the tropical and flowery island of Jamaica. Many drowsy afternoons had he spent here with orange juice and a siphon at his elbow and the best of Havanas in his teeth. For Billy, in the opinion of every man he met in the islands, with the single exception of the American consul, was a retired manufacturer, with money to spend and time hanging heavily on his hands.
As a matter of fact, his table at the café was chosen because it gave him an opportunity to observe Fun Ken and his satellites, whom he suspected of being a part of a huge conspiracy for the smuggling of opium and Chinamen into the States.
This afternoon he had thus silently gained a reaffirmation of his belief that Fun Ken was a part of the organization with which he had already associated Wilmer Peterson, whose acquaintance he had been cultivating. He had seen Peterson alight from the electric car that passed the door. The American had gone through the café and out at the back. Fun Ken, who was at the time presiding at the cashier's desk, had immediately disappeared. Half an hour later Fun Ken was again on the cashier's stool and Peterson shortly thereafter returned to the café. This occurrence had been witnessed for three days in succession by the special agent, who regarded it as a convincing indication of collusion between these two men.
Of Peterson's operations, Gard already had absolute proof. This he had gained at Port Antonio, the shipping point for fruit at the other end of the island. He had been sent to the Caribbean because of the difficulty the United States was having in preventing the smuggling of opium and of Chinamen not legally entitled to enter the country.
It was suspected that Jamaica was the base of operations for these smugglers, and theGovernment wanted to understand the case from the inside.
Gard assumed the rôle of a retired glass manufacturer who had time to lounge the winter away about the southern seas. For two weeks he had luxuriated about the Hotel Titchfield, in Port Antonio, and changed his clothes oftener than any Englishman in the place. There he had noted the clumps of idle Chinamen who made headquarters near the wharf, and the occasional stealthy American who was particularly in evidence when there were freighters in the harbor.
Gard soon became a familiar figure about the hotel lobby and bar-room, where he spent money freely. Likewise was his boat to be seen on the bay for many hours of the day, for he made rowing his diversion.
"Don't buy drinks for that bunch, Mr. Gard," Hogan, the bartender at the Titchfield, admonished him. "They are nothing but a lot of smugglers."
This was his first lead. That night Gard rowed late on the bay, skirted a banana boat that lay tied to the wharf and scrambled up unseen to a side door of the customs house. Tothis door he had a key. He let himself in. Where the customs house faced the wharf were large double doors through which freight might be taken directly to the boat tied there. The special agent unlocked these doors and made a crack just large enough for observation and for eavesdropping, but still so small as not to attract attention from the outside. Here he waited from eight to eleven o'clock.
In the stillness of this late hour the skipper of the banana boat and Peterson, the smuggler, held a conference.
"I have room for ten men," said the skipper.
"I have the men ready to come aboard," said the smuggler.
"And the money?" suggested the man of the seas.
"The cash is ready; $150 for each man when he is stowed away. You will land them at Mobile."
"At Mobile," assented the captain.
"See me next trip at Kingston," said the smuggler. "I leave for that point in the morning."
Thus was gained the first peep into the methods of the smugglers. Gard reported tothe American consul, who sent a message that would result in the seizure of the banana boat when it reached Mobile.
The special agent now had the thread of his work well in hand. His intentions were to get at the very bottom of the affair, however, and not merely to apprehend an individual like Peterson. That gentleman should be induced to show the way. Peterson should be "roped." That most effective, yet most difficult task of working into the confidence of a culprit and inducing him to lay his cards on the table, should be employed.
It was with this idea in mind that Gard came down to breakfast early the next morning, but not so early that Peterson was not there ahead of him. He sat opposite his man. The special agent kept looking at his watch apprehensively, and finally asked the man opposite if he knew what time the train left for Kingston.
"At eight-thirty," said Peterson. "There is plenty of time. I am going over on that train myself."
This opened the conversation, and placed Gard in the position of having first indicatedhis intention of making the trip. He had said he was going before he seemed to know that Peterson had any such intention. These small matters are of great importance in laying the foundation for getting your man. They talked through the meal. It was but natural when, at 8:15, Gard appeared with his grip and started to enter his cab, that he should ask Peterson, who was just then ready for departure, to join him.
At the station the smuggler, as a return favor, advised Gard not to purchase a ticket, as one could ride for half the fare by handing the cash to the conductor. Gard, however, declined this opportunity to save money, for he was looking to the future and the necessity of establishing himself in a given light with this stranger.
Peterson asked his companion as to the hotel to which he was going in Kingston.
"The Myrtlebank," said Gard.
"It will cost you six dollars a day," said the smuggler. "Come with me, and I will show you as good accommodations for three."
A detective less experienced in roping mighthave considered an opportunity to go to this man's hotel with him as a piece of good fortune. Gard declined the invitation.
"No," he said. "The expense is of little importance to me. I shall stay at the Myrtlebank. Won't you take dinner with me there to-night?"
Peterson, being what the English call a "bounder," was impressed by his friend's disregard for money, and eagerly accepted all his invitations to share a more expensive hospitality. So was the atmosphere created for which the detective was striving.
The two men spent much time together. They automobiled about the city and dined at the resort of Fun Ken, back in the hills. The man who claimed to be a retired glass manufacturer seemed to be a careless sort of individual, with a disregard of how he spent his time. He was rather indifferent of his associates, it seemed, and inclined toward those whose lives were free and easy. He was the last man in the world to appear to have any interest in the activities of his fellows, or to care whether their means of livelihood was honest or not. He was the source of a great deal of satisfactionto Peterson, who was often embarrassed by inquiries into his occupation.
And all the time Gard was picking up the details of the operations of the smugglers. It was through the negro boy who waited on him at the hotel that he learned of an opium shipment. The boy had overheard the conversation that gave him the information, and told of it amusingly in the cockney English of the Jamaican negro.
Sing Foo was the moving spirit from the Chinese end in these smuggling operations. He was a more important man, in fact, than was Fun Ken, who ran the resort on the hill. Sing Foo was a wealthy merchant with a large establishment in the center of the Kingston Chinatown. Gard had been studying his establishment. The strange thing about it was that there were constantly two or three hundred idle Chinamen in its vicinity. The presence of Chinamen not at work is a condition so peculiar as to require an explanation. But with the smuggling theory in the back of one's head, it was easy to conceive that these superfluous Mongolians were waiting an opportunity to be shuttled into the United States.
The smuggling of opium and of Chinamen was known to go hand in hand. Sing Foo, according to the negro boy, had arranged a shipment of opium to Philadelphia. A French-American named Flavot, whom Gard had met through Peterson, had been the intermediary. The captain of a tramp copra trader was to carry it. It was to be snugly hidden and, when the steamer docked, nothing was to be done immediately about it.
Presently a large negro wearing a linen ulster would come aboard under the pretext of doing some sort of work about the ship. This negro was to be shown the opium. He would carry it out a few boxes at a time.
Gard cabled his home office the details of this deal in opium introduction. He advised that nothing be done until the negro went aboard, actually carried out the stuff and was followed to his principal. There was a slip in Philadelphia, however; the captain got suspicious and the opium was thrown into the river.
Two months passed in this way. All the time Gard and Peterson were becoming more intimate. One day the supposed retired glass manufacturer confessed to the smuggler thathe had once made some easy money by backing some men who had a system of beating the poolrooms. This, he said, was in Vicksburg, Miss. The poolrooms in that city got their returns on the Memphis races on a loop that was relayed out of New Orleans. That is, the results were telegraphed from Memphis to New Orleans and from there relayed to the smaller cities on a telegraphic loop. This caused a delay of about four minutes. The men whom Gard had backed had established communication by telephone between Memphis and Vicksburg and got the returns in time to put down bets ahead of the receipt of the poolroom's information. Thus they made the cleanup.
This not merely paved the way to similar confidences on the part of Peterson, but gave him to understand that Gard's morals were none too puritanical, and that he might be induced to back other questionable enterprises.
Peterson evidently thought this matter over thoroughly before acting, for it was three days before he touched on the subject. Then he said:
"I could show a man of your sort an investment that would pay him a hundred per cent.every month, if he were looking for a chance to make money."
"Well, I am not looking for such a chance," said Gard, "but if one should drop into my lap I might tie a string to it."
"Do you know anything about the opium business?" asked the smuggler.
"Not a thing," said Gard.
"Well, a can of opium can be bought for five dollars in Jamaica, and sold for twenty-seven fifty in Philadelphia."
"That's a pretty good profit," said the special agent; "but a man would have to get more than two or three boxes past for it to amount to anything."
"If you had a trim little schooner and some one to show you how to get her past the authorities, and she was loaded with opium to the gunwales, you would not have to make a trip every other week to keep in cigarette money, would you?"
"Obviously not," assented the capitalist.
"And you may have noticed all these idle Chinamen about Sing Foo's place," continued the smuggler. "Somebody is going to get one hundred and fifty dollars apiece for runningthose fellows into the States. They are crossing in a steady stream and getting past. It is but around the corner of Cuba and a hundred inlets inviting. Twenty of the Chinks can live in a space as big as a dog's house, and they feed themselves. It's clear profit. The little schooner could carry a score or so of them every trip."
"It looks like a good proposition on paper," said Gard. "If it could be demonstrated, it would easily get a backer. But the trouble with all such schemes is that they are good on paper, but they can't be actually shown upon the basis that a business man with money demands."
"But this one can be shown," urged the smuggler.
"That is the way you fellows with fancy schemes always talk," argued Gard. "You can make all the money in the world if you only had the backing. Then a man with the money comes along and says 'show me.' You always fall down on the showing."
"Would you put up the price of a schooner and a cargo of opium if you were shown that my scheme would work?" asked the smuggler.
"I would," said Gard. "But you mustremember that I am a business man who has made his stake by strictly business methods. I must be shown."
This was the first step toward the formation of a smuggling syndicate that labored along in its preparation for birth and died tragically.
Gard here insisted on proving to Peterson his commercial reliability and financial standing. He had long before prepared the papers for just such an occasion. He had credentials, and letters of credit, and certificates of deposit and bank books without end. The smuggler had had no idea of the wealth of the man he had been cultivating. The backing was without end, if he but won this man's confidence.
So he took the financier in tow, with the idea of first showing him the source of supply of opium and of Chinamen. In the presence of Gard he got quotations on opium from Sing Foo and from Fun Ken at five dollars for a can the size of a pot of salmon. It was shown that there was opium to be had practically without end.
And the Chinamen themselves! He was told that there were always five hundred of them in Jamaica, ready to make the run into the States.When these were gone there were as many more on the way. In fact, there was all China to draw from. Every Chinaman who came was a member of an association. That membership was to cost him six hundred dollars. He need not pay in advance, as such men as Sing Foo stood back of the association and furnished the capital. Whenever a Chinaman got into the United States he went to work. He was able to earn at least twelve dollars a week. Half of this went to the association, until the six hundred dollar fee was paid. The association was willing to spend a total of four hundred dollars to get a Chinaman into the country. Its minimum profit was two hundred dollars a man. The stream flowed constantly. Were not Sing Foo and Fun Ken the richest Chinamen in the Caribbean?
The supposed financier declared himself satisfied of the abundance of the supply of these objects for profitable smuggling. But he wanted to see some of the money actually made. Whereupon Peterson and Flavot agreed that he should have a complete demonstration.
There was then a Norwegian bark in port, and her captain had agreed to take aboardtwelve Orientals. He was bound for Norfolk. Peterson and Flavot had made arrangements with him, and Sing Foo was ready with his men. In the dead of night Gard accompanied the two Americans as they pushed off the well-laden boats from the foot of a deserted street in Kingston. He saw the men go aboard. He went deep into the bow of the ship with them and saw them nailed up in a nook behind a wall that seemed to be the end of the vessel. He saw a Chinaman who had come aboard as the representative of Sing Foo pass the captain eighteen American one hundred dollar bills. He went back to Chinatown with Peterson and Flavot and saw them draw their bonus of fifty dollars for each Chinaman that had thus been disposed of.
The capitalist declared himself convinced so far as the Chinamen were concerned. How could he be shown profits in opium?
"Opium," said Peterson, "is the one sure way of making easy money. If you are ready for a little run back to the States, I will show you all the details."
The special agent assured the smuggler that he would be as pleased in making a run back tothe mainland as in loafing in the Hotel Myrtlebank, if there were amusement in it and a chance to make some money in an interesting way.
Two days later the three men were aboard a fruit and passenger steamer at Port Antonio, bound for Philadelphia. Beneath the mattress of each man's bunk were twenty cans of opium.
"All you have to do," elaborated the smuggler, "is to open up your baggage for inspection as you approach the port. The inspectors go through it, but never do such a thing as look beneath the mattress. When they have gone you take the opium out from its hiding place and put it into your baggage, which had already been inspected. Then it goes ashore."
"But," insisted the special agent, "is not your stuff examined again on the wharf?"
"This system would not work," Peterson explained, "if you were landing at New York. There the baggage is examined in the staterooms and again on the pier, as the passengers come ashore. But in Philadelphia there is but the one examination, which takes place in the stateroom."
"But is there not a pretty good chance thatthe inspector may sometime look under the mattress?" Gard asked.
"There is the barest possibility," assented the smuggler. "We have been taking it in this way for years, and it has never been found. But if it is discovered, we have but to look innocent. It cannot be proved that we are responsible for its presence. It might be the steward."
The three came into Philadelphia, and passed the customs officials as the smugglers had prophesied, without a hitch. They went to their hotel, and there found themselves each the possessor of twenty cans of opium, for which they had paid five dollars and for which, Peterson said, they were to receive $27.50. This was the part of the transaction that was yet to be demonstrated.
"We will do but a little business in Philadelphia," said Peterson, "just to show that it can be done."
They took ten cans of the opium to a Chinaman in Arch street, with whom Peterson was acquainted. Yes, this man would buy opium. The price for the same grade was the same as before, $27.50. He could use all he could get.He would be glad to take ten cans. The profit on these ten cans was $225.
"We could have sold him a hundred cans as easily, with ten times the profit," said Peterson.
In New York the smugglers called upon a Doctor Yen, in Pell Street, one of the important men in Chinatown. He stated that he was able to buy opium at $27.50. The smugglers insisted on $30. After much haggling 20 cans were sold at $28.50. Here was a profit of $470.
But Doctor Yen was to be counseled on a much more important matter. He was to be told of the proposal to purchase a boat for the opium traffic. He was to be asked to guarantee the purchase of large amounts of opium.
The old Chinaman became greatly excited. He ran to his safe and came back with $10,000 in currency. He was willing to put up this money for its value in opium at $27.50 a can as soon as delivered. When that was gone there would be other money. He alone would make the owners of the boat rich.
In Boston was the actual headquarters of Peterson and Flavot. A Jew by the name of Ferren was their financial backer. It wasFerren who had put them into the business. When Ferren was told of the proposed enterprise he would not at first listen to it. He would have to be shown that this Mr. Gard was on the level. There were too many eyes watching for opium.
Peterson told of the credentials, and finally succeeded in convincing him that Gard was what he purported to be and, gaining confidence as the plan developed, the Jew finally became enthusiastic. In the end he vied with Doctor Yen in his anxiety to purchase unlimited opium.
Gradually Gard granted that he was convinced of the feasibility of the scheme, if he were shown the possibility of getting the schooner into the States. It was at this point that he was introduced to one Captain Bailey, who had, some years before, figured in a very sensational attempt at the introduction of Chinamen from Canada and their landing at New Haven. Bailey had been caught, had served a term in prison, and, since his liberation, was running a fish stand in Boston market.
But Bailey knew all the coves in the Atlantic and the gulf into which a boat might put. He knew every dock where she might tie up, and the time that must pass thereafter before it wouldbe safe to put his men ashore. Operating from Jamaica there was none of the danger into which he had run in bringing Orientals from Canada.
Eventually the papers were drawn, setting forth conditions under which all these men entered into a partnership in this smuggling venture. Gard, Ferren, Peterson, Flavot and Bailey had all signed, and Gard had gone to New York to get the signature of Doctor Yen. The district attorney's office in Boston was prepared for the arrests when the papers should finally be signed. When Doctor Yen affixed his signature Gard signaled an associate across the narrow street in Chinatown. He sent the flash to Boston and the trap was sprung.
WHEN DOCTOR YEN AFFIXED HIS SIGNATURE GARD SIGNALLED
"WHEN DOCTOR YEN AFFIXED HIS SIGNATURE GARD SIGNALLED"—Page 135
So were all the inside facts of this most aggravating system of smuggling revealed. With these facts in hand, the Government had little difficulty in breaking up a system that had been causing a lot of trouble for a decade.
So, also, was one of the most complete and successful cases of "roping" that any of the Government agents had ever attempted carried to a successful termination.
"It is astonishing," said Gard, the bookkeeper, "how few people know anything about their own business. Take bank accounts, for instance. Many people have money in the bank which lies there inactive. There is not one man in five, having such an account, who can tell the amount of it."
This statement was launched during the evening meal at Mrs. Hudson's very respectable boarding-house in the prosperous little town of New Beaufort, which slumbers in one of the valleys of central New York.
"I must take issue with you there," ventured the elderly rector of the Episcopal church who, being a widower, boarded with Mrs. Hudson. "I, for instance, have managed to save a little money for old age and I can tell the amount of it to a penny."
"And I know just how much I have on deposit," insisted Miss Dolan, the school-teacher.
"And I am quite sure of mine," asserted a buxom widow who had collected life insurance.
"As a test of my contention," said Gard, "I am willing to pledge a box of candy to each of the ladies and cigars to the gentlemen who will set down the exact amounts of their inactive accounts in the First National bank and then prove their figures correct by application to the cashier."
This proposal appealed to those who had been drawn into the incipient controversy. Next day they asked for the figures, and each had won his reward. Gard seemed chagrined that his theory should have thus gone to the winds, but he cheerfully stood treat.
For he had established a fact very important to him. The inactive accounts of the First National bank of New Beaufort were intact.
This was one of the first steps in an investigation of a financial institution which, while seemingly in the best of condition, was suspected of having been looted for hundreds of thousands of dollars. Special agents of the Department ofJustice knew that an official of the bank had been trading heavily in Wall Street and that he had lost. Gard, a member of this new detective force of the Federal Government, had been sent to investigate. Representing himself as a bookkeeper he had secured a position with the leading grocer and had come to board with Mrs. Hudson.
He stayed three months. At the end of that time he reported the shortage, fixed the blame upon the man responsible for it, showed the methods used, cited the accounts from which the money had been stolen, told what accounts were still intact. Yet he had never been inside the bank, had seen none of its books, had consulted with nobody familiar with them, had received no confessions. The manner in which he accomplished these seemingly impossible ends illustrates most excellently the methods used by this new detective agency of the Government.
It was a strange conspiracy of circumstances that brought to New Beaufort detectives from three different services on the night, two months later, that Conrad Compton, the enterprising citizen and banker, was giving his big party.
There was McCord, a plain-clothes man fromNew York. McCord would not have been in New Beaufort but for the ramifications of the New York police department in keeping track of these middle class criminals who live through the trade of burglary—a calling that is sometimes refined to art. And the police department would not have come into possession of a certain tip if "Speck" Thompson had not done his bit up the river and returned to his old haunts so broken that he chose to become a stool pigeon because he was no longer up to second story work.
Speck had found that "Dutch" Shroder had arranged to crack a safe and that the scene of the cracking was New Beaufort. He had tipped the matter off to the police, and hence McCord's presence in a community that was far from metropolitan. He represented the first of the detective services.
The second such service was represented by Ogram Newton, a bank examiner in the service of the treasury department. His district was central New York. For three years he had been taking an occasional look into the books of the various national banks of his district, checking up assets and liabilities, inquiring intothe value of the paper held by the banks. Two weeks before Conrad Compton gave his party Newton had been in New Beaufort and had gone thoroughly into the affairs of the bank. Its books were models of efficiency and there was no flaw to be found in any of its securities or loans. Newton had given the institution his O. K. and had passed on to other towns.
But there was a feeling of unrest that haunted the young examiner. It seemed that his subconscious mind was aware of an oversight that had been made by his working faculties. He was not able to sleep well of nights, and in his sleep the various accounts of the New Beaufort bank insisted on visualizing themselves. Finally the recurring accounts eliminated themselves with the exception of one which persisted. The loans and discounts account kept thrusting itself into his consciousness.
"By Jove!" he exclaimed suddenly to himself. "The entries in that account, the amounts of money that have been run through it, are out of all proportion to the other business of the institution. Something is wrong with loans and discounts."
So Newton hurried back to New Beaufort andwas that night a guest at the party given by Conrad Compton, with whom he had built up a friendship through years of association in the line of his work. He was to take a further look at the loans and discounts on the morrow.
The Department of Justice is the prosecutor in cases of violations of the national banking law. Its work is entirely apart from that of the bank examiners of the treasury department. The New York office of this service, as a matter of daily routine, received the information that David Lorance, assistant cashier of the First National bank of New Beaufort, was regularly placing heavy buying and selling orders with a certain broker in Wall Street.
For this reason, Agent Gard got the assignment to come to New Beaufort, and was thus the representative of the third detective service. His windows at the grocery store looked out upon the side door of the bank opposite. He was bland and inconspicuous, but he was an expert accountant, had taken a degree in the law and worked three nights a week in the gymnasium in New York when he was in town.
The Compton home stood on a hill just back of the town. It was known as Stone Crest andwas the most ambitious establishment thereabouts, being always pointed out with pride to visitors. The banker was a widower, but given to entertainment and to charity. The members of the board of aldermen often met at Stone Crest to discuss those matters that had to do with the well-being of the town. Teas were given there whenever its charitable women were inaugurating some new venture. The party to-night was a semipublic affair, for it was in commemoration of a centennial anniversary of that occasion when the first settlers had fought off attacking Indians from their stockade through a day and night.
Conrad Compton was a tall, graceful, nervous man, with a high forehead and a mass of wavy hair. His features were of a perfect regularity and the whole face was so small as to give it somewhat the appearance of that of a woman, an impression that was heightened by its absolute pallor.
Ogram Newton, the bank examiner, watched his host narrowly as he received his guests, as he directed their entertainment by a party of professionals who had been brought up from New York for the occasion, as the ices wereserved. He thought the banker was a bit paler than usual and his natural nervousness seemed somewhat accentuated. Once during the evening he had drifted into the library which happened to be empty of guests, and had found the host peering out of a window that commanded a view of the town.
"I trust you will pardon my preoccupation," said the banker, turning again to his guests, "I seem to have a way of feeling lonesomest when I have most company."
McCord, the plain-clothes man, had vacillated between his hotel, the railway station, and those streets that gave views of the alleys leading past the back ends of establishments that might contain safes worth raffling. Occasionally his eye fell upon the lights in the house of the banker on the hill, and wandered to the chief financial establishment of the town. Yet all was so serene in this eddy of the world that the hour of solitude that followed eleven o'clock seemed such an age that it drove him to bed.
As the time drew on toward twelve there was no sign of life in the village. The lights in the drug stores, the restaurants, the delicatessens where ice cream is served to the small townlovers, had one by one winked themselves out. The owl car of the trolley line that ran through the village had deposited its last late revelers at eleven-thirty. The swinging arc lights at the street intersections occasionally sputtered fitfully and glared again. A dynamo whirred distantly at the electric light plant.
Gard, the special agent of the Department of Justice, was one of the few men in the town who was awake except those who had been guests of the banker and who had lingered to an hour which was almost unprecedented in New Beaufort. They would have gone home at eleven, but the banker insisted that they remain for further entertainment on the part of his New York musicians. One song called forth another and the quality of the music proved so much more pleasing than that of their customary local talent that they forgot the passing of time. The special agent sat on a hill near the Compton home and smoked a pipe.
It was twelve o'clock before the party finally broke up. Those of the townspeople who had come in their automobiles were being tucked into the tonneaus, and those who had walked up the gray macadam drive were just setting out onfoot when the clatter as of a bunch of giant fire crackers called their attention to the village below. From the bank building was seen suddenly to burst a cloud of smoke while, a moment later, a skylight was broken and a tongue of flame leaped forth.
"Fire! Fire!" came the shout from a dozen voices.
Gard had seen more than had the guests of the banker. As he smoked his pipe and watched the village below, the lights in the windows of Stone Crest, and the silent cottage of Lorance, the assistant cashier, he had seen an automobile, with no lamp showing, creep through the quiet back street, purr stealthily into the alley back of the bank and stop behind a small building that shut off his view. Half an hour passed and the darkened machine reappeared from behind the intervening building, turning into the thoroughfare leading to the southeast and disappeared in the distance at an ever increasing rate of speed.
When the exploding cartridges in the cashier's drawer at the bank gave the first warning of the fire, the clamor of the alarm followed and pandemonium broke out in the village. Ofthe dispersing group on the hill, every one ran for a nearer view of the fire. The musicians, the servants, the master of the house himself, all hurried into the village to make part of the excitement that prevailed. Stone Crest, the lights of its entertainment still glowing, was left deserted.
Gard, the special agent, again acted differently from his fellows by failing to do the thing which others did. He crossed over from the hill on which he had smoked and hastily entered the banker's house. Arriving, he seemed to know exactly what he wanted. He hurried through the rooms of the house, snapping on still more lights until he found that apartment which seemed to be the personal retreat of the owner.
Here he evidently had business. Standing in the middle of the floor he looked about. Thrown carelessly into a window seat he saw two heavy books of the appearance of ledgers. These he secured and placed on a table in the middle of the room without even examining them. Next he began further exploration. When he found the banker's bedroom he seemed satisfied. On the back of a chair wasa coat, evidently that which Compton had worn until he dressed for the evening. Gard thrust his hand into the inside pocket of his coat and pulled out a batch of letters through which he ran rapidly. He selected two or three, thrust them into his pocket, returned for the ledgers, tucked these under his arm and left the house.
On the way to his lodgings he filed a telegram to the department at Washington which read as follows:
Compton, cashier in First National bank case, guilty. Lorance probably not implicated. Bank burned to-night by accomplices of Compton. Case complete.Gard.
Compton, cashier in First National bank case, guilty. Lorance probably not implicated. Bank burned to-night by accomplices of Compton. Case complete.
Gard.
The manner in which these conclusions were reached are but typical of the methods of the sleuths of the Department of Justice. Gard had come to New Beaufort with but a suspicion that Lorance, the assistant cashier, was playing the market on the funds of the bank. Lorance was known to be placing orders with a Wall Street broker.
At the boarding house Gard learned that Lorance lived modestly in a cottage with his wife and babies, had not been seen to make anydisplay of money, was of sturdy farmer stock. On the other hand the investigator immediately picked up the facts that the cashier, Compton, maintained an expensive establishment, entertained lavishly, was often absent from town, was nervous, highstrung, in bad health.
All these facts led him to watch the cashier rather than his assistant. They led him, also, to some experimental testing of the condition of the bank's accounts. He knew that a dishonest employee of a bank, in appropriating money, had to charge it to some account to make the books balance. The large, inactive accounts offer a most tempting opportunity of this sort; but these were found to be intact by his ruse of inducing the depositors to call for their balances.
It was to get a better line on the business of the community, and particularly upon the accounts of Compton, that the special agent secured a position of bookkeeper in Joy's grocery store. Here he found, in the first place, that the buying of the Compton home was profligate and evidently wasteful. He found, further, that the bills were always paid without question and by check. Knowing of an old trickthat has brought many a cashier to ruin, Gard sought a way to test these personal checks to determine whether or not they actually found their way to the personal account of the cashier.
The cashier of a bank is usually the individual who opens the mail, and many of these have been known to cash personal checks and destroy them when they came in for collection, charging the amount to some account where it might temporarily be hidden. To determine whether or not these personal checks were being juggled by the cashier Gard, as the grocer's bookkeeper, found a pretext to send to the bank for a record of some personal checks of Compton's which he had handled a few days earlier. The call was made while Compton was out to lunch, and the checks could not be found. Through another dealer Gard succeeded in getting a second similar request made with the same results. He concluded that Compton was at least juggling his personal account and charging the amount of his personal checks to some other account, probably loans and discounts.
In various ways the special agent found opportunities, even without seeing the books of the bank, of demonstrating to his satisfactionthat 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 secondavenue 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 berecords 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 bankexaminer. 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.
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 UncleSam 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 throughthis 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, topick 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 Gardwas 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 dockin 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 intelligentman 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 thecustoms 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 backof 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 seentoo 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 nightat 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 partof 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 torecord 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 escapepunishment; 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.