SUGAR FRAUDS. GemweeteeboilOC TN PE RESTS, HEALTH peewee Faves N USE WAYS AND MEANS COMMITTEE INVESTIGATIONS (Hon. FERNANDO WOOD, CHAIRMAN,) SEPTEMBER 1/) AND-18, 13878, AT THE NEW YORK CUSTOM HOUSE. VERIFIED PACTS AND FIGURES, SewHICH SUPPLY =. * EVIDENCE or REVENUE ROBBERIES. SUGARS & SYRUPS POISONOUSLY ADULTERATED. SUGAR DUTY, DRAWBACK, ETC. Henry A. Brown, 1878. SUGAR FRAUDS. VERIFIED FACTS AND FIGURES SOME COMPARISONS WITH Mx, Gavomeyer’s and Mls, Emahoey’s Statements, BEFORE CHAIRMAN WOODS COMMITTEE, Cio bG AM rw) SEIN EVV OTR IK September /7th and /8th, 1878. The classification of facts produces reliable evidence by the use of which great truths may be established, and public abuses and evils may be prevented or greatly mitigated until by persistent application of the proper remedial forces they may be entirely suppressed ; abuses and evils cannot exist except by the sufferance and toleration of those whose duty it is to unfold truth and maintain it, regardless of personal interests; the moment falsehood and sophistry are sternly confronted by evidence and truth they rapidly retreat and dissolve into nothingness. The representatives of certain sugar interests who testified so glibly before Mr. Wood’s so-called Ways and Means Investigation Committee of Customs business at New York on the 17th and 18th of September, 1878, that no frauds and no adulterations existed in the matter of Sugar, and withdrew in consternation after only two broadsides had been fired from the ranks of honest importers and refiners, who have had intimidation enough, presented evidence that truth will prevail against the monstrous abuses, adulterations, and frauds in the matter of sugars, which have rioted unchecked in the past, and not only robbed the revenue of duty and excessive draw- | back at will, but placed poisonous compounds, called refined sugars and pure syrups, upon the tables of the people whose treasury these 2 sugar ring manipulators have previously robbed, and destroyed hon- est importers and refiners right and left to increase their gains from such nefarious practices. It is no part of the writers purpose to discuss this sugar fraud question; between truth and falsehood there is nothing to discuss; facts and figures honestly adjusted and properly explained, admit of no discussion, and in reality of no reply that will bear analysis. The facts and figures presented by Mr. Robert Hewitt, Jr., of the firm of Messrs. J. M. Ceballos & Co., sugar importers, before Hon. Fernando Wood’s Custom House Committee on the 17th of September, 1878, being incontrovertible evidence against the defrauders, were in- stantly denied by members of the association, who have since endeavored to suppress the figures altogether; casual thought teaches that such hasty denial of data requiring large research and careful compilation from numberless final official statistics accessible to but few was, to draw it mild, a fatal sign of weakness on the part of the rejoinder. A prepared statement intended to annihilate Mr. Hewitt’s figures was laid before Mr. Wood the next morning by Mr. T. A. Havemeyer, of the firm of Havemeyer & Elder, sugar refiners ; so far from producing that stunning effect, it simply enables ‘ Truth” to convict defrauders upon the evidence of competent witnesses; as will be shown in these pages. Regarding adulterations of refined sugars and syrups, so’ stoutly denied by Mr. Theodore A. Havemeyer and others before Mr. Wood’s tribunal; the clear statements and lucid illustrations presented to the Representative of the Ways and Means Committee during the inves- tigation named, proved too much for the hitherto well organized forces under the lead of Messrs. Havemeyer, Humphrey and others, and seriously affected the Committee, who incontinently closed the sugar investigation with Mr. Booth’s effective testimony against the fraudulent practices and manipulations of a great sugar trade combination. A brief synopsis of the facts developed, and other facts and figures regarding frauds upon the revenue by sugar ring operators, and adulterations in the refined article, with a fact or two about the polariscope, sugar duty and drawback, will furnish matter for the serious consideration of Congress, and information for the people who eat the adulterated article, foot the bills, and are taxed extra to make up a deficit of millions of dollars per annum, of duty stolen and drawback overpaid on a single article of necessity—sugar. At Mr. Wood’s enquiry meeting on the 17th of September, 1878, Mr. Robert Hewett, Jr., on behalf of honest importers and refiners of sugars, whose business has been greatly injured and in many instances ruined by defrauders, presented the subjoined statement, which is an exhibit based upon faets and figures arranged from official data re- corded after the sugars had entered into consumption, and the final PON cate of duties, and the eransactions had pie ings closed in 1878: Mr. HEWEHTT’S STATEMENT. © The following data, compiled from records in the Bureau of Sta- tistics at Washington, and deductions therefrom, are respectfully sub- mitted to the Ways and Means Committee of Investigations of Cus- toms’ business at New York, on the subject of Sugars imported and entered into consumption in the United States, and duties liquidated thereon. Sugar importations entered into consumption in the fiscal years ending June 30, 1876, 1877, and for New York alone in 1878: Weight, Ibs. Duties received. Rate per Ib. TBg ect ee aes. 1,561,880,545 $37,625,064 2.41 1ST ee Jb 1,455, 387,854 34,337,350 2.36 Sugar importations entered into consumption at New York, fiscal year 1878: Pex (hitge son bee 1,073,598,1438 Lbs. $24,834,786 2.3131 —Being 72.86 per cent. of the total importations into the United States for the fiscal year 1878. New York importations amount to 72.86 per cent. of total for 1878. New York importations grade above No. 10 D..S. as per esti- mate of the commission on the New York Custom House, known as the Jay Commission, and the testimony of New York refiners. Consequently, at least 72.86 per cent. of total importations are above No. 10 D.S. Rate of duty on 73 per cent. of total imports, per lb..........-. 2.8125e. Rate of duty on 27 per cent. of total imports, per |b.:-... 2.2... 2, 50e. A VGPavG, deecnee Loc. Be de Batok OF Laer 2.781.250. RECAPITULATION. Weight, lbs. Rate per Ib. “Duty received. i ae re A ge 1,561,880,545 at 2.41¢. Collected duty . ...$37,625,064 1,561,880,545 at 2.fa01c, ) Correct duty .. 222. 42, 610, 053 ROVODUC AISCTOUANCY sec a uy - <-6 Soe a0 dese one es $4,984, 989 a ek Se ie ae 1,455,387,854 at 2.386¢. Colle sent, duty ... $ 34, 337, 7,350 1,455,387,854 at 2.7281¢c. Correct duty...... 39, 104, 799 Revenue discrepancy........ .. oud? Ras udd eh S5,8675449 AT NEW YORK ALONE. LE (eens igen. Le 1,073,598,143 at =—-—s-2.8181e. Collected oe 5338 beets 1,073,598,143 at 2.7281¢e. Correct duty...... 29,413,339 MGVENUS CISCTODANCY . 252... Jen be Cases eth. J2it. $4,578;558 { SUMMARY OF DUTY DISCREPANCIES. 1876, AMAOUIG SF a scs deste cecal b es ko - canes bees ae eee $4,984,989 A877, -ATBOUNL . - . cus pa Beeicic aces sinc Eietee pee ee Oa ne 5,367,449 fers; amount, Newayork: . 220.2: a ee ee eee 4,578,553 Ttis evident that honest sugar merchants have no occasion to dis- pute the above figures, which only mildly portray the extent to which frauds in sugar dealings have been carried; nevertheless sugar men at once denounced the figures as false altogether, or based upon in- voice values,—invoice values, however, have nothing to do with the matter, and it is simply Impossible to subvert the figures given with- out producing accumulative evidence of frauds on the revenue in sugar transactions ; the attempts to denounce and refute Mr. Hewett’s figures was in itself evidence of sympathy with revenue robbers to say the least. ‘The above broadside from honest importers, and the straight refiners who at once began to gain courage,raked the enemy fore and aft; at the opening of Mr. Wood’s court the next day, Sept. 18, Mr. Theo- dore A. Havemeyer, handed to the Hon. Chairman of the Ways and Means Committee, “a statement in reply to the allegations made by Mr. Hewett ;” doubtless Mr. Havemeyer has excellent reasons for assuming the defensive in the case, but his so called statement, is simply a pernicious manipulation of figures having no bearing what- ever upon Mr. Hewett’s figures, except that Mr. Havemeyer found himself compelled to use the figures presented by Mr. Hewett, as to duty received in 1876 and 1877, in order to obtain a basis for a new diversion, doubtless intended to prevent Mr. Hewett’s evidence and data from having full effect : : Whatever the object may have been, no better evidence of mon- strous duty frauds could be procured than Mr. Havemeyer’s statement analyzed in connection with Mr. Solon Humphrey’s testimony, has added to the overwhelming evidences of frauds before and since accu- mulated ; in justice to both these gentlemen, and all others who have with them assumed the defensive in this sugar fraud question, the statement referred to is given as reported in the New York Herald of Sept. 19, 1878. Mr. THEODORE A. HAVEMEYER’S STATEMENT. “Tt is claimed there has been a falling off in the revenue of sugar ot several millions of dollars, and that this is a positive evidence of fraud, but the statistics, carefully prepared by the government, do not confirm the statement. For the fiscal year ending June 30, 1875, there was collected as revenue on sugar $33,380,643 as against $37,- 625,063 for the year ending June 30, 1876, and $34,337, 350 for the year ending June 30, 1877. From these should be deducted the 5 amounts returned by the government as “ drawback” on retined sugars exported, which makes the following exhibit :— 1875. 1876. 1877. Duties received.....- Pee Lire $33,380,643 $37,625,063 $34,337,350 Less drawbacks (estimated). 810,000 1,800,000 1,380,000 Balance................ $32,570,643 $35,825,063 $32,957,350 This leaves an apparent difference between the years 1876 and 1877 of $2,367,713, but the reports of the Bureau of Statistics show— tbs, That there was of sugar remaining in bonded warehouse June 30, 1875... 565,831,322 That there was imported during the year ending June 30, 1876............ 1,454,254,633 Total on hand and imported during the year ending June 30, 1876... .1,98.,085,955 That there was remaining in bonded warehouse June 30, 1876............. 28:5,343,491 Which leaves amount of sugar entered into consumption during fis- Sal year eudimg dune 9071076 . 2022. ae a os Shea ni fee eb ecioes | 1,62%.,742,464 That there was of sugar remaining in bonded warehouse June 30, 1876-. "282,343 3,491 Imported during the year ending June 30, 1877...................--------- 1,58-. 162,924 Total on hand and imported during fiscal year ending June 30, 1877. 1,867,506,415 That there was remaining in bonded warehouse June 80, 1877...........-. 33%. 078,645 Which leaves amount of sugar entered into consumption during fis- OHI MERE ONUI Ue DUIS? tat. ses dec ccr eda cs eon ecieicweee tne tae. 1,531 427,770 Showing a decreased consumption for the fiscal year ending June 30, 1877, of 104,304,694 pounds. This at an average duty of 2,41 cents per pound would have produced for the revenue $2,513,984, leaving an actual difference of $353,729 between the two years, which may be attributed to the facts before given and to the fact that a _ greatly increased amount. of sugars. imported during the fiscal year ending June 30, 1877, were entered for direct consumption, and hence the increased duties paid on them on liquidation of the entries, does not appear in the statistics. The high prices of sugars ruling during the fiscal year ending June 30, 1877, oreatly checked and reduced the consumption, and a de- creased revenue is the inevitable result of a decreased consumption.” It will be evident to any intelligent observer of Mr. Havemeyer’s statement, that the deduction of drawback from duty received and | the increased consumption claimed therein, add largely to the volume of frauds set forth in Mr. Hewett’s correct data; but setting draw- back aside for the present, the following tables "exhibit the correct figures as presented to Mr. Wood's Committee by Mr. Hewitt, measured in accordance with Mr. Solon Humphrey’s statement made before the Wood Committee September 18, 1878, in regard tothe grades of imported sugars which entered. into consumptier in the United States. It should be borne in mind that Mr. Humphrey testified that he had “examined into the subject and found the reports of fraud to be immensely magnified ; the classifications last year were very ac- curate indeed ;” and Mr. Havemeyer stated that “the charges of fraud were all bosh.” 6 Mr. Solon Humphrey, of EK. D. Morgan & Co., sugar importers, © stated in relation to grades-of sugars D.8., that the proportions of imported su gars entered into consumption were as follows: Of No. 7 D.s , 20 per slike RS, Duty 12c. and 25 per cent. per lb. Of No. 10 D. “8. ., 60 to 65 per cent._..----. Duty 2c. and 25 per cent. per lb. Above 10 Dd. S., 1 5 0 20 oe Cent. ...2 8 - Average 24ce. and 25 per cent. per lb. The following tables are based on the above proportions applied, to the actual number of pounds of imported sugars entered into con- sumption and the liquidated duty thereon; an average of 24c. per lb. is used as duty on sugars above No. 10 D.S. Entered into consumption in 1876, 1,561,880,545 pounds. 20 per cent..... *, 313 3%, 109 Ths. Ov ise. scents eam Gee $5,466,581 91 , Add 28 per cents... 202-22. 1,366,645 48 ——_—_—_— $6,833,227 39 65 per cent... ih ag 1,015, 222,354 Ibs: at 20... 2.2 22200 EE Sah Pitch oad. 20,304,447 08 Add 25 per cent. et ae ee 5,076,111 77 | ——_—_———— 25,380,558 85 15 per cent. sy "884. 282, 082 Ibs. HO aC oon dee eee oie ce he es 5,857,052 05- Add 25 per cent........... 1,464,263 01 pera ak at ——_————— 7,321,315 -06 1,561,880,545 Ibs. Proper duty...... $39,535,101 30 Duties liquidated i in 1876. add. gb tin esdseriyss The reece, Duele eee 37,625,064 00 "1876; "Heveniie discrepancy). J.c. 3... 2 4s fre es Saeeeae $1,910,037 30 . Entered into consumption in 1877, 1,455,387,854 pounds. 20 per cent... Pape pal O71 LDS. At 1G.) 2 Se A RL $5,093j857 48 ‘ ‘Add 25 per Gente2n3-..:.)- 1,273,464 37 Ms ——— $6,367,321 85 65 per cent... _.. _ 248,006, 105 Ibs. HE AG. 8 a a 18,920,042 10 . 4) Add 25 per cent. i2.2cl2 2: 4,730,010 52 ff: —_—_——— 23,650,052 62 15®per cent... .. i 308,178 Ibs. at Qic..........-.- tig hpi] 5,457,704 45 sag 25 per centi...-. RAB: 1,364,426 11 we ernest coe nih =, 6,829,180 56 1,455 R87 8 Ted Proper duty...... $36,839,505 03. Duties liquidated j in 1877... hea ee che Rye CORN d potecadte Ne ce es aed ee re ee 34, 337, 350 00 1877,; Revenue discrepancy....:- SE 4 Gu OR Tee ee $2,502,155 03 Average duity per ‘lb. as per Mr. Humphrey's testimony and Mr. Hewett’s figures. In 1876, 2.4090¢e. In 1877, 2.3593¢e. Thus according | to Mr. Humphrey, who first stated, as reported, that “for the past three years the revenue from sugars have been col- lected with an increasing degree of correctness, the classifications last year being very accurate indeed,” and then gave the grade proportions above named, there. were frauds amounting to $1,910,037. in 1876, and frauds amounting to $2,502,155 in 1877. “Mr. Humphrey being hope- lessly adrift in Tits, statements, it may be well to bring Mr. T. He Have- meyer to his. rescue. . Mr. Hav emeyer, for purposes “of his own, pre-_ pared a. tabular, statement for the Wood Committee which has already , been presented herein; by referring to said statement it will be ob- served that it was claimed that the imported sugars entered into 7 consumption during 1876 and 1877 were largely in excess of Mr. Hewett’s statement, the liquidated duty being the same in both state- ments; therefore, according to Mr. Havemeyer and Mr, Humphrey, the following exhibit of evasions of duty on sugars by false classifi- cation should be deemed reliable evidence that monstrous frauds upon the Custom’s revenue are practiced successfully. ANALYSIS OF Mr. T. A. HAVEMBYER’S STATEMENT AND MR. SOLON HUMPHREY’S TESTIMONY AS TO SUGARS IMPORTED AND ENTERED INTO CONSUMPTION FOR SEVERAL YEARS PAST. According to Mr. Humphrey the proportions of imported sugars entered into Sous entign 3 are: 20 per cent. No. 7 D.S......-. Duty. gc. per Ib .2.*: 25 per cent. added. 65 per cent. No. 10D. S8....... Dutyize. perlby oie 25 per cent. added. 15 per cent. above 10 D.S..... Average 24c. per lb.... 25 per cent. added. Average duty as above would be 2.531250e. per Ib. Consumed as per “Proper duty as — Duties received. Havemeyer. per Humphrey. Liquidated. ACO: 3. 1,635,742,464 lbs. $41,404,731 $37,625,064 11 1 ea a ae 1,531 ,427,770 lbs. 38,764,265 34,337,350 3,167,170,234 Ibs. $80,168,996 $71,962,414 Revenue discrepancy, 1876 and 1877, $8,206,582, When such eminent authority on sugar matters as Messrs. Have- meyer and Humphreys, unwittingly furnish in their statements, proofs of the existence and extent of frauds to evade payments of duties on sugars, after testifying in substance there were no frauds, no better evidence that Mr. Hewett’s figures of sugar consumption and liquidated duty are correct, is requisite ; said fieures are not only of- ficial, but are verified. Not only do Messrs. Havemeyer and Humpbh- rey’s ‘figures prove frauds amounting in 1876 to $3,779,667, and in 1877 to $4,426,915, but these gentlemen reduce the rate per lb, of duty received in 1876 from 2.41¢. as per Hewett, to 2.3019¢. per Ib.; and in 1877 from 2.36¢. per Ib. as per. Hewett, to 2 a ee per lb. as per Havemeyer and Humphrey ’s figures. Pursuing the analysis of Messrs. Havemeyer and Humphrey’s statements in detail, still stronger evidence of gigantic frauds is deduced ; when drawback is deducted from duty received in the years named the amount of fraud is largely increase d pro rata, and the rate of duty per lb. received, is also further lowered ; deducting drawbacks, and using. Humphrey’s ‘ste itements, with Havemeyer’s consumption of sugar figures, the volume of frauds upon the revenue approximate to the actual facts, which will be clearly seen in the following exhibits : * Combining the years 1876 and 1877, and using Hewitt’s figures with Humphrey’s g evades, the following result is obtained; in this Table the drawback figures, liquidated duty, and lbs. of sugar consumed, are from 8 the Bureau of Statistics records, after final adjustment in the Treasury Department at Washington : Entered into consumption. Duties ree’d. Drawback. 1676C 1,561,880,545 Ibs. $37,625,064 $2,613,525 86 1877i eels 2 1,455,387,854 lbs. 34,337,350 2,258,959 56 3,017,268,399 lbs. $71,962,414 $4,867,485 42 Duties received. Less drawback. Nett duties received. $71,962,414 $4,867,485 $67,094,929 Average rate of duties received, nett, 2.2236c. per lb. Mr. Solon Humphrey’s statement of grades entered into con- sumption is as follows: Of No.7 D.5., 20 per cent. rate of duty....... 1c. and 25 per cent. per lb. Of No. 10 D. S., 65 per cent. rate of duty...... 2c. and 25 per cent. per lb. Above 10 D.S., "15 per cent. average of duty. Qhe. and 25 per cent. per lb. Average according to Humphrey, 2.531250c. per lb. Entered into consumption. Humphr ey’s rate. Pyapen duty. 3,017,268,399 lbs. 2.531250c. per Ib. $76,374,606 Nett duties received and liquidated..................-... 67, 094, 929 Two years 1876 and 1877, discrepancy..........-......... $9,279,677 Less drawback paid in 1876 and 1877. «td. eee ea $4,867,485 485 Nett discrepancies in 1876:and) 1877... ..1.2..5.0..48.4 ela, $4,412, 192 In order to give Messrs. Havemeyer’s and Humphrey’s figures full scope, the following table exhibits a similar analysis based on Mr. Havemeyer’s statement of sugars entered into consumption in 1876 and 1877, and on Mr. Humphrey’s grade statement: Consumed as per .. Duties received. Drawback Havemeyer. Liquidated. Payments. 1S76 fies ite 1,635,742, 464 lbs. $37,625,064 $2,613,525 86 ASTUTE ry 1, 531, 427,770 lbs. 34,337, "350 2,258,959 56 3,167,170,234 Ibs. $71,962,414 $4,867,485 42 Duties received. Less diawback. Nett duties ree’d. $71,962,414 $4,867,485 $67,094,929 Consumed as per Rate of duty per Proper duty Havemeyer. Humphrey. according. 3,167,170,234 lbs. 2.531250c. per lb. $80, 168,996 Nett duties received and liquidated...................-.. 67,094,929 Two years 1876 and 1877, discrepancy..............--.--- $13,074,067 Less drawback paid in 1876 andis77 ete). tien ie $4, 867,485. Nett discrepancies in 1876 and 1877.............. 2... cee cne cc eeee $8,206,582 One other exhibit of the actual figures of sugar consumption and liquidated duty thereon in 1876 and 1877, and the approximate to actual grade, D. S., of such sugars as furnished by abundant evi- dence, testing, and reasonable deductions from the sworn testimony as reported, of New. York sugar refiners before the Jay Commis- sion in 1877, and substantially by Mr. Humphrey’s statement, and by the generally expressed belief of competent importers will for the present suffice. y The evidence proponderates that so far as imported dry sugars. enter into consumption in this country, the actual average grade thereof measured by the Dutch Standard, is above No. 10; consequen- ly the proper average rate of duty cannot reasonably be fixed at less than 2,8125 cts. per lb. without stigmatizing the general trade as im- porters of the poorest known sugars by preference while England and other countries, including the active producers, consume the better grades; the following result, [ am satisfied, is below the actual facts as regards duty evasions on dry sugars imported and entered into consumption in the two fiscal years 1877 and 187%% Entered into consumption, Duty received, Drawback paid, 1877 and 18783 1877 and 18783 1877 and 1878 3,017,268,399 lbs. $71,962,414 $4,867,485 Duties liquidated. Drawback paid. Nett duty rec’d. $71,962,414 $4,867,485 $67,094,929 Entered into consumption. Rate of duty. Proper duty. 3,017, 268,399 lbs. -_2.8125¢. $84,860,678 Duties received less drawback paid...........2.......2.------- 67,094,929 Duty discrepancy in two years, 1876 and 1877................-. $17,765,744 Less drawback paid in 1876 and 1877..........---....2222-.222. 4,867,485 Nett duty diser epancies, LEVEE WEG BE, oy y BON URE 7 Maa SRE a $12,898 898,259 The conclusion is inevitable that instead of disproving the figures presented to Wood’s Committee by Mr. Hewett, Messrs. “Havemey er and Humphrey have furnished data, evidence, and testimony which prove that the Government is defrauded of customs revenue amounting to several millions of dollars in duty per annum; although the full measure of sugar frauds is still greater, here for the present we will leave the figures for public consideration, and touch briefly upon other topies of the sugar subject. VALUABLE TESTIMONY ABOUT SUGAR FRAUDS. ADULTERATION OF REFINED SUGARS AND SYRUPS, WitH RELEVANT DATA. Without entering fully upon the evidence relating to the practice of adulteration of refined sugars and syrups, in the case of refined sugars exported to obtain drawback in excess of the actual sugar product, and in the case of both sugar and syrups, to defraud con- sumers in this country by palming upon them poor sugars and syrups lightened up to appear of higher grade, by the use of muriate of tin, a few facts, and some reference to the valuable and honest testimony of Mr. Wm. T. Booth, of the well-known firm of Booth & Edgar, sugar refiners, as given before Chairman Wood’s investigating committee on the New York Custom House, on the topic of adulterations of syrups and sugars, will furnish matter for consideration which can- not be too widely circulated. 10 During the examination of Mr. Theodore A. Havemeyer by Chair- man Wood, the day previous to Mr. Booth’s appearance, Mr. Have- meyer is reported to have stated under oath as follows: “ The alleged sugar frauds are all bosh.” “ I do not believe that in five years the frauds in sugars amounted to $10,000.” ‘ Not an ounce of adultera- tion enters into my factory, or goes.into the sugars I produce.” Mr. Havemeyer doubtless forgot that a large shipment of poor sugar, ‘aised to a high grade by the use of a solution of tin—that i is, tin dis- solved in muriatic acid, called “muriate of tin”’—and other poison- ous compounds, was recently returned to New York from Texas, to be sold at any price, having changed color to low grade, and become 7 unfit for sale entransit to its destination. Mr. Havemeyer also seems to have lost sight of the notorious fact that solution of tin in carboys is regularly sold to, and regularly used by refiners of low grade su- gars, to lighten them in color, and that sulphuric acid and bisulphate of lime are extensively used for similar purposes. Mr. Havemeyer having placed himself on record again on the de- fensive, as above stated, the substantial evidence presented to Chair- man Wood by Mr. Booth becomes interesting and valuable. The fol- lowing excerpts are from the full official report of Mr. Booth’s testi- mony, as given before Wood’s Committee of Investigation of customs business at New York, Sept. 18, 1878: Mr. Booth—In regard to Mr. Hist aisor) Dutcher’s testimony given here the day before yesterday, he is reported as stating that no complaints have ever come to him in regard to this matter of fraudulent impor rtations. During the month of August, 1877, my father and myself went to his office at_his request to express our opinion in regard to some Demerara cargoes of colored sugar which had been seized by order of “he Government, and at the close of the conversation on that point we remarked. to him that this Demerara business was a mere bagatelle, and that the Government were unwise in ‘wasting their strength on that while there existed in the business of importing sugars in this country ‘such serious frauds. I then stated to him that time and time again during the year 1877, our firm had offered to us, sugars, cost and freight laid down here, guaranteed to be fair to good refining, and guaranteed to pass s the Custom House at 1g duty, and I remarked ‘that he and every one else knew that that could not be done “honestly. The fact is that these offers came to our office until we said: ‘That business cannot be done honestly,” and then such offers ceaséd to be made. Now, I wish it understood that I appear here as a sugar refiner, and I speak asa refiner. When it is understood that the refiner has been in the habit of taking the sugar to his dock, that that dock is almost exclusively for the use of the refiner, and that there those sugars can be lanied, and weighed, and sampled, and. passed into the refinery in a very short time, and that instances have occurred where within . twenty four hours of the time when the sugars were landed at the refiner’s dock they were melted, and all chance of identifying “them lost, it will be seen that the refiner. has an advantage which the importer has not. In regard to Mr. Havemeyer’s testimony here yesterday, 1 think there is an error in that too. .Mr. Havemeyer is reported as saying that uot.a pound of. adulteration ever entered his refinery. Is that your testimony, Mr. Havemeyer? Mr. Havemeyer—That is my testimony. . Mr. Booth—Do you mean by that statement that not a pound of adulteration has ever entered your refinery ? Mr. Havemeyer—I mean that not a pound has ever entered my refinery to be used in sugar. Mr. Booth—Or in the produet of your refinery ? 1] Mr. Havemeyer—In the product of my refinery. Mr. Booth—Sugar or syrup ? ‘Mr. Havemeyer—Sugar. ‘Mr. Booth—Not syrup ? Mr. Havemeyer—Not syrup. The question was about sugar. Mr. Booth—I think the question was about the adulteration of sugar, or of any of the products of your refinery. Mr. Havemeyer—No, sir; it was about the adulteration of sugar for export, and I said that not a pound of adulterating matter entéred into the sugar produced by our refinery for export, and I say so now. Iam not here for a cross examination, lane. ever. Mr. Booth—No; but as I noticed that you were whispering to Mr. Wood and suggesting questions to be put to me, I thought I would give youa turn. I under- stand now that you wish to change this statement and to confine it to sugars for export. Mr. Havemeyer—I only said that no adulteration entered into our sugars for export. Mr. Booth—But for syrup such matters have been used ? Mr. Havemeyer—For syrup we used what you did, a little sulphurie acid to reduce the crystallization. Mr. Booth—Nothing else? -Mr. Havemeyer—Nothing else. Mr. Bootbh—No tin? Mr. Havemeyer—N0 tin, not lately. Mr. Booth—Ah! “not lately.” Mr. Havemeyer— About five years ago we used tin, and our chemist left us and went to Booth & Edgar and others, taking with him our secret. Ido not know how much Booth & Edgar paid him, but others paid him fifteen hundred or two thousand dollars for a secret which belonged to us. Mr. Booth—Are you under oath now? ° Mr. Havemeyer—No, I am not under oath now? Mr. Booth—Then I object to your making any statements of that kind here. We never had but one chemist in our employ, and that was Dr. Chandler, the President of the Board of Health of this city. oe Mr. Havemeyer—-I reiterate my statement made here yesterday under oath. Mr. Booth—Before I proceed with the main subject, I would like to correct what [regard as another erroneous statement made by an importer here yesterday, namely, that there are rarely two colors of sugar in mats and bags. - Mr. Havemeyer—What I said was that there were no foots. Mr. Booth—Mr. Chairman, I state here that there are rarely any cargoes of mat sugars or bag sugars which do not contain at least two colors, and in many instances they contain more than two colors. There is very rarely a cargo of Pernambuco Sugar received at this port but that when the sampler of the broker and the sampler of the refiner are sent on board the vessel they are instructed to take off the sugars on the upper part and go down into the heart of the cargo in order that a fair sample may be obtained. I would also state that there is hardly a cargo of Manilla sugar received here that does not contain two colors. The very fact that that cargo is put into a ship and sent through warm and cold countries makes it sweat, and the result is} part of the sugar is necessarily worse than the rest of it, and there is just as much room for fraud in the importation of Manilla sugars as there is inthe importation of hogheads from Cuba with their foots. Thatis a fact, and there is not a man _ here who deals in sugars who can deny it. The difficulty of furnishing proof in regard to this matter of fraud is very great. It was only to-day that a man, who has sat in thisroom and has heard the testimony that has been given here, said to me, “I would like to testify there, but I dare not. I amin business here, and if I go in there and tell what I know about this sugar question, my business is gone and | cannot afford to testify.” This matter of fraud in sugars has been running through the bus- iness here for ten years. It is now ten years since aman said tome: ‘There are on the docks in Brooklyn Melada hogsheads with the bungs timned over which I have looked into and they contained centrifugal sugars.” I wish to.say here that in any remarks I may make in regard to government officials or in regard to these samplers, these poor men whose bread and butter depends on their position and who hold their positions only as long as the influence of certain men can be retained on their side, do not mean to hold them up as the principal offenders. I have great sym- LIBRARY UNIVERSITY OF ILLINOIS AT URBANA-CHAMPAIGN 12 pathy for them. ‘Their position has been a hard one. They have been exposed to influences which I pray God I may never be exposed to. Theirs is a hard case and I wish to speak of them tenderly and with pity. But for those men in this city who have connived at fraud, who have allowed their clerks and their employees to go to these poor men and bribe them, and then when the charge of fraud is brought against them, claim that it is a matter of collusion between the Custom House officers and their own clerks. Words fail me to express my contempt. I feel deeply in this matter. I have been at work for a good while lookinginto it. Ian known to all these gentlemen here present. For twenty-five years I have gone in and out here engaged in this sugar business; I am, I believe, the oldest man to-day who has bought for re- fining in the city of New York; I probably have passed upon as much sugar_as any man inthe business; I have always maintained a good reputation, and I doubt whether there is a man here to-day, who, when I assert that I know a thing will say that he has any doubt about it. Now, I do say that I know that there have been frauds in this sugar business; I know that the government has been robbed and I know that unless this matter is taken up and unless these abuses are rectified by the Government, more men must come to grief than have already come there. The infor- mation which I have on this subject is confidential and cannot be used at present, but Iam perfectly certain that if the Committee of Ways and Means shall take up this question, with power to compel men to answer and to punish those who testify falsely, they will be able to furnish to the people of the United States some reading that will be truly wonderful. There is another side to this question. If you have read the papers you have seen allusions made to adulterations of refined sugars. The Chairman—All that we want at present is any information which bears upon the better collection of the revenue and the prevention of frauds. Mr. Booth—Well, as we proceed you gail see that fraud on the revenue is the father, adulteration of refined sugar is the mother, and the polariscope is the child. The Chairman—Give us the whole family. Mr. Booth—Thank God, sir, there has never been but one child and we propose to introduce a new race and new blood. Tsay that adulteration of refined sugars is the mother. Would you like to see her sir? Here is a piece of her that I picked . up this morning. [Producing a small paper of whitish powder.] Taste of it. Here is the ‘‘well-known sweet. crystalline substance, manufactured chiefly from sugar cane!” I said that fraud on the revenue was the father. He had two wives. Would you like to see another one of them? The Chairnanu—Yes. i . The: Mr. Booth—Here it is—tin! [producing a chemist’s vial containing a sample of tin.] and here is another [producing a smaller vial of tin.]_ I tell you sir that adul- teration of sugar does concern the Committee of Ways and Means; it concerns the Board of Health, it concerns everybody. This sample that I have shown you came from a gallon of syrup made by a sugar refiner in this city. It was sent to Dr. Chandler, the President of the Board of Health, analyzed by him, and ‘returned to me, and the refiner who made the syrup when he discovered that I had the sample laughingly said, “J didn’t think you could find it, but you can’t find it now.” I got another sample of his syrup and sent it to Dr. Chandler and from that came this smaller tin wife that I eae shown you. This question of adulteration has become of national importance. The people of the country are deeply interested in it aside from these statements which you see in the papers. Within the last twelve months more refined sugar has been returned to the refiners of this country from the com- sumers as unfit for use than in any ten years preceding. I know to day of an invoice of refined sugar coming back from Texas ith the instruction from the purchaser: ‘* Sell it for what it will bring. I can’t use it.” I stand here to day as a refiner, to plead for a uniform rate of duty on all sugars up to No. 16, excluding foreign refined sugars. I claim that a uniform rate of duty on all sugars up to No. 16 will save the refining business and give the people of this country an opportunity, of using for- eign raw sugars if they wish to, thus tending to elevate this refining business into an art instead of degrading it as it is now being degraded. Do you ask me whether I believe that the refiners adulterate their sugars? Do you ask me whether I know how they do it? [tell you, Yes, Ido. I know thatthey adulterate their sugars and I know how they doit. You may blindfold me asI stand here now and I will go with you into the houses of one of the largest refiners in the neighborhood of New York and put your hand on the place where the job is done. I know what I am talking about, and I know that itis not bosh. Ihave had men come to me week after week, offering me this and that adulteration and saying, “ Others use it. I oe ~ . ) sell carload after carload of it to this concern and that concern. They are all using it in large quantities.” My position as a refiner has been such that I have been en- abled to know just about what was going on in regard to this glucose business, and I think we shall all hear more about it by and by. Then as to fraud, there is not a man in this room who knows anything about the business who does not know that frauds are committed. A man came into our office the other day and said, speaking about these frauds, ‘‘Itis not good to do this but ‘they all doit.’” I understand there is a regular tariff over there in Brooklyn under which the thing is done, and I am told that there is evidence of it. Now in regard to the question what will be the effect of a uniform rate of duty on all sugars up to No. 16, as regards low grade sugars? I don’t know what Mr. Turnure testified here, but I do know that every time that this question of tariff has been up among us at the lower end of the street Mr. Turnure has been in favor of a uniform rate of duty on all sugars, at least up to No. 16 until the commencement of 1878. It is a matter that I have thought of and canvassed long and carefully. I have a refinery that is competent to work either poor or good sugars, so that [am unbiased in that respect, and I give you my judg- ment, after due deliberation, that a uniform rate of duty on all sugars up to No. 16 will not necessarily exclude common sugars from this market. The weight of the testimony is that the common sugars will come here. We shall have sugars testing 98 brought here and coming in as number 16, and if the trade of this country de- mands low grade sugars, low grade sugars will come in to meet the demand, by a law of trade which is as unchanging as the laws of nature. Where there is a de- mand for an article, that article comes. If we put this uniform rate of duty into operation what will be the effect? The low grade sugars, which are full of dirt, and which are not fit to go into consumption, will shrink in price in the foreign market and the load will go where it ought to go, on the producer, and we shall no longer bring dirt into this port and pay for it at the rate of five or six cents a pound, in gold. Ihave set down on paper some suggestions that I would like to offer, and ] offer them after careful consideration of the whole subject. I would suggest: 1. No more sugar landed at refiners’ wharves. 2. If possible, persuade the merchants of the United States to buy and sell on Custom House weights and Custom House tare. 3. Let the Government be a little liberal and weigh the sugars when they come out of bond instead of when they go into bond. The Government can afford to do that, because if we get the business down on to a square, honest basis, they can get all the revenue they want out of sugar at about two cents a pound. 4, Place a uniform rate of duty on all sugars under number 16, Dutch standard, in color, and add a clause which shall prevent the importation of refined foreign sugars. After due reflection, I am satisfied that these changes will help the business, will stop the frauds in importations, and will also stop the adulterations, because when the people of the country know that if the refiner’s product is not satisfactory they can use foreign raw sugars instead, the refiner will very soon discover that he must make his sugars good enough to satisfy the people, and I for one, as a refiner, have no fear of the competition of foreign raw sugars. I believe that the refining interest of this country is skillful enough and enterprising enough to retain the trade which we have got, and with a uniform rate of duty on all sugars up to number 16, I be- lieve we can force the people to consume our refined sugars in preference to any others, because we can give them a pure article in good shape and at a cheap price. It is proper, and a fitting sequence to the above unimpeachable tes- timony, to present the following circular, which was issued after Mr. Booth’s statement had been made to Mr. Wood’s committee, and pre- sented to the public. The notice is as follows: ‘Tn view of the assertions circulated through the press charging refiners in a general way with adulterating their sugars, we, the un- dersigned, consider it a duty we owe to ourselves and the public to refute such imputations, and do hereby declare that refined sugars sold by us are not, nor at any time have been, adulterated.” (Signed,) HAVEMEYER & ELDER. THE DrEcASTRO & DONNER REFINING Co. 14 THe F. O. MATTHIESSEN WIECHERS SUGAR REF’G Co. THE BROOKLYN SUGAR REFINING Co. As a disclaimer, the above card amounts to nothing, inasmuch as the refiners who sign the card have not been constituted champions of the sugar trade of the country; neither have they as yet been called upon individually or specifically to defend themselves against the already surging waves of popular indignation in regard to poison- ous adulterations of refined sugars, and robbery of revenue by duty-stealing and drawback-filching practised in the evasion of duty by false classification of imported sugars; to reduce the grade for levy- ing duty thereon, and in obtaining drawback in excess on exports of refined sugars by the use of poisonous adulterations to raise the grade, and of glucose, starch and flour of trifling value comparatively, to re- duce the volume of pure sugar in the refined article. As regards the specific evidence of these impositions upon the people, the relation of Government officials to the perpetrators thereof, and the responsibility for their continuance, they will be presented at the proper time before the proper tribunal, in the interests of the pub- lic; and here for the present I leave this vital part of the sugar ques- tion for the consideration of the people and their representatives in Congress. SOME IMPORTANT FACTS ABOUT POLARISCOPES AND POLARIZA TLGN. APPLIED TO SUGARS. DUTY, DRAWBACK, AND REMEDIES. Webster describes the polariscope to be ‘an instrument consist- ing essentially of a polarizer and an analyzer, used for polarizing light and analyzing its properties ;” such an instrument, adapted to the analysis of cane sugar in solution, is used for determining the percent- age of pure saccharine matter in a given volume of sugar of cane solution. The process is as follows, the proportions being always ne- cessarily the same, in order to insure accurate results : Weight of sugar crystals, 26,048 grammes; dissolve in 100 cubic centimetres of water: add acetate of lead sufficient to precipitate ; filter through prepared bone dust to clarify ; fill a glass tube, 200 millime- ters in length, with the solution, and place the same in the polari- scope ; turn on the light, look through and adjust the instrument until both hemispheres present to the eye precisely the same shade of color; the test is then perfected, and the result will be found regis- tered in degrees and fractions on the scale attacbed to the polariscope, and may be read through the magnifying tube; 100 represents en- tirely pure sugar crystals i in solution. LD So delicate and sensitive an instrument as the polariscope is valu- able for purposes of chemical analysis ; but for testing imported sugars for the purpose of levving duty thereon, or for sale, it would be im- possible to devise any other method whereby the Government, the im- _ porter, or the buyer, or all together, could be defrauded with such per- fect ease and safety, as through the means afforded by the use of the polariscope; and against the dangerous temptation to fraud thus offered, there exists no adequate check or hindrance. For instance, the operator adds a few drops more of water than the proper quantity, and the grade is lowered; or a few grammes of sugar more than the proper quantity, and the grade is raised; the operator may if he prefer slightly adulterate high grade sugars and thus lower the grade for duty, and vary the practice at pleasure ; nor is this all; the color test in the instrument, provides fresh opportunity for both error and fraud; only the most accurate eye and skillful ad- justment can exactly determine the perfect color blending which marks the record of true grade upon the scale; and the slightest deviation therefrom, raises or lowers the grade at the pleasure of the operator ; detection is next to impossible. For the purpose of levying duty on sugars, the Dutch Stand- ard for determining grade is bad enough, but the use of the Polariscope will make matters infinitely worse, and furnish a vehicle for the safe practice of fraud indiscriminately upon the revenue, the importer, the buyer,and the consumer, at the option of operators and their instigators. DUTY, DRAWBACK, REVENUB, BTC. Practicable remedies for these public abuses and evils as regards sugar frauds are at hand, and their application has at length become an imperative necessity in order to protect the public from poisonous adulterations, and the customs revenue from robbery of at least nme or ten millions of dollars per annum by evasion of duty on imported sugars, and by drawback stealing on refined sugars exported, in excess of duty paid. It is practicable, equitable, and safe, for the purposes named, to adopt a uniform specific duty upon all grades of imported sugars up to No. 16, D.S., and also to establish a uniform specific drawback based on duty paid, regardless of grade and of cargo identity, upon all refined, sugars exported from the United States which are the actual product of sugar refineries in this country. Equitable grading, with various rates of drawback, and requiring the positive identification of cargoes by the Government for drawback purposes, has proved to be utterly impracticable, and it is absolutely impossible to protect the revenue unless a uniform duty and drawback is adopted. - The duty on sugars up to, and ineluding No. 16, D. S., ought not 16 to exceed 2 (two) cents per lb.; the average annual consumption of sugar and Melada during 1875, 1876, 1877, three years, which was of sugar 1,531,054,115 lbs., and of Melada 73,182,469 lbs., total average 1,604,236,584 Ibs. would produce at 2c. per lb. $32,084,731 of revenue per annum from such sugars, which under a uniform duty could be fully collected. It is sheer nonsense to pretend that a uniform duty will exelude low grade sugars; it will simply reduce their price in the market of production to American buyers, and to a degree induce foreign pro- ducers to make cleaner sugars in order to obtain better prices for their products. Consumers of sugar in this country, should: look with care to the refined article which they buy, and not be misled by plausible sophis- tries about low grades of raw sugars, say below No. 13, D. S., which they have had neither desire nor opportunity to buy, and are not likely to have; if refiners are forced to use cleaner sugars and pay full duty thereon, to prevent consumers from buying No. 16, D. 8., so much the better for both revenue and+people. Sugars above No. 16, D. S., should pay 4 (four) cents per Ib. duty to protect the refining interests of this country ; this added to the duty on sugars up to No. 16, D.S., and on molasses, would produce fully $35, 000, 000 of revenue per annum from sugars and molasses, less the the ‘drawback, say $2,000,000 ; leaving a nett yearly revenue of about $33,000,000 from ‘imported sugars and molasses. In 1877 the Customs Revenue from the articles named was as follows: Duty received from sugars, $34,337,350; from molasses, $1,- 812,525; from Melada $930,944 ; total $37,080,819, less drawback pay- ments in 1877, $2,253,959, nett revenue from dry and wet sugars and and molasses in 1877 fiscal year, $34,826,860. It will be seen that 2c. per lb. duty on all sugars to and ineluding No. 16, D. S., 4c. per Ib. duty on all higher grades, and the present duty on molasses, will produce at least $33,000,000 nett duty from these articles ofter deducting drawback ; and that said duty can be fully collected ; common sense teaches that this is a sufficient duty tax upon a single article of public necessity. The monstrous publie abuses and evils engenderd by the long continued practice of sugar frauds, which hang about. the nation, de- stroy official integrity, imperil publie interests, deplete the Treasury, and endanger the very lives of the’ people, are among the natural results of a ponderous and unjust Tarifft—Executive maladmin- istration of the Customs Service of the country—unprincipled trade combiné and individual chicanery; and the only remedy for such complicated evils is for Congress to render their continuance impossible under any administration. HENRY A. BROWN, SAXONVILLE, MASs.