603
[iv]
From this total some abatements have to be made, but Mr. BRUCE SHEPHERD is of opinion that a sum of $5,000 would cover these.
6. Taking then the amount which should have been received for Crown Rent during the above mentioned years at...............................
and adding thereto the balance of arrears outstanding on the 31st December, 1887, taken from a Rent Roll of that year, the last which has been added up and audited,
we arrive at a total of
$936,153.44
84,192.51
$1,020,345.95
whereas only the sum of........
873,888.29
has been paid into the Treasury in respect of these collections, leaving balance of...
2
..$ 146,457.66
which should be outstanding on the 31st December last, whereas the Rent Roll balanced on that day shows arrears amounting to
83,639.93
$62,817.73
the difference
being the amount which we fix as the total of the defalcations, and we beg to report accordingly. The sum appears to have been taken as follows :-
1888 and 1889
1890
1891
1892
$29,480.07
12,900.98
11,053.49
9,383.19
$62,817.78
7. In answer to the second question, viz, :—By what person or persons they have been committed, we beg to state that all the evidence points to ALVES, the second clerk and accountant, as the only guilty party.
8. With regard to (e) what other person or persons, if any, may by neglect of duty, or otherwise, have directly or indirectly contributed thereto, we report as follows:-As stated above, the only defalcations have taken place in the Crown Rents, a branch of revenue respecting which there was an absolute check, as the exact amount which the collector should have received and accounted for was known every six months.
9. The system of collecting or receiving Crown Rents was supposed to be or should have been as follows
Mr. ALVES was the second clerk and accountant in the Treasury; his duties being to make up the Crown Rent Roll and the Journal, to close up the Colonial Accounts, the Yearly Accounts and also the Crown Agents' Accounts, which Mr. MITCHELL-INNES says was a complicated matter, and he had also to make returns for Somerset House. This last duty we presume was only since the new system of auditing has been in force.
10. The Rent Roll was made up from a return received every six months from the Land Office. It gives the number of the Lot, the name of the Lessee, the amount of the arrears on the 1st January, the amount due for the current year, the amount paid in the course of each half-year, the dates of payment, and the amount outstanding on the last day of the year. This book it was ALVES' duty to make and keep up and balance at the end of each year.
[v]
11. All sums of money due for Crown Rent were to be paid to a shroff specially appointed for the purpose. Persons coming to pay rent would generally bring with them some memorandum of the amount due or their last receipt. The shroff would pass that on to ALVES, or in any case of difficulty would go to ALVES, who, upon being satisfied that the proper amount was tendered, would enter the amount and the number of the receipt into a small cash book which he kept, he would then fill in a printed form of receipt taken from a book with counterfoil and consecutive numbers and give it to the shroff to make an entry thereof in his cash book, the shroff would then chop the receipt and hand it, when duly signed, to the person bringing the money, At the end of the day the shroff would compare his book with that of ALVES. if Both agreed the amount was reported to Mr. CARVALHO, the cashier, who made a memorandum for the bank and the money was paid in at once.
12. We have stated above that the receipt should be duly signed, we beg to explain this as follows:--Previous to the 14th December, 1888. all the receipts for Crown Rents, Taxes, Licences, &c, were signed by Mr. CARVALHO, the chief clerk and cashier, but on account of complaint made by CARVALHO that the signing of these receipts took up too much of his time, a change was made and in a memorandum date the 14th December, 1888. Mr. LISTER, who was then Treasurer, stated that it would tend to the better working of the department if receipts, licences and other formal documents were in future in each case to be signed by the officer responsible for the issue or the correctness of the document, instead of being signed by the cashier himself.
From that date accordingly all receipts for Crown Rents were signed by ALVES and chopped by the shroff.
This placed the whole control over the receipt of Crown Rents in the hands of ALVES.
13. It was never intended that ALVES should receive money: he was merely to control and check the receipt of money by the shroff, but if money was sent or paid direct to him (ALVES) there was no control over him, and as he signed the receipts himself it was easy for him, if so inclined, to make away with such money, unless precautions were taken by some checks or surprise visits in the department itself, and unless his Rent Roll was added up and balanced soon after the expiry of the year. if not at the end of every six months.
14. In the absence of ALVES' cash books it is impossible to ascertain the specific and separate sums embezzled, and even if it could be ascertained it would serve no practical purpose, as the method adopted by ALVES in his defalcations appears to have been as follows:-
15. When money was sent or taken to him, he either-
(a) Paid it over to the shroff;
(b) Paid part of it to the shroff, taking with him the printed form of receipt in which appeared in figures the amount he paid over but in words at length the real amount which had been paid to him. The shroff could not read English but knew English figures, he compared the figures on the receipt with the money handed over to him, made an entry in his cash book, chopped the receipt and handed it back to ALVES, who then made the figures agree with the other part of the receipt and gave or sent it to the payer;
(2) Or else he appropriated the whole amount sent to him and made out a receipt on a printed form of his own, which he must have had printed for the purpose, signed the name, and chopped it with a forged chop.
In the case (b) he made the counterfoil correspond with the amount handed by him to the shroff, and not with the amount paid to himself. In the Rent Roll he entered the full amount which he had received, while in his cash book (or Daily Collection book) he entered only the amount paid by him to the shroff.