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In this way the clerk tampered with ten bills during the period from August, 1926, to October, 1927, and misappropriated $685.00.
On the discovery of the frauds Pau Tat Shing was arrested and sentenced to two terms of imprisonment amounting in all to five months with hard labour.
He then refunded $360 and thus the loss occasioned by his frauds was $325.
77. Undoubtedly if Mr. Crook had examined the bills when signing the cheques, or had called for the production of the receipts, the frauds would have been at once dis- covered. He relied, however, on the fact that the bills and vouchers must be examined in the Treasury before they were passed for payment, and must after payment be sub- jected to Audit, and it did not occur to him, any more than it did to the Treasurer and the Auditor, that fictitious items might be added after he had initialled and signed the documents.
The factor which most contributed to the ease with which the fraud was carried out was the time-honoured custom of entrusting to the clerk the payment of tradesmen's bills.
In doing this Mr. Crook merely followed the custom of his predecessors.
The cash payments rarely amounted to as much as two hundred dollars in any month, and the amount would be divided up amongst several tradesmen.
In adopting this method Mr. Crook recognized that if the clerk misappropriated the money entrusted to him for the payment of an account he, as the Headmaster, might be called on to make good the amount, but he felt it necessary to continue to make the payments in this manner because his duties did not allow time for going around paying tradesmen's accounts.
Section V.
THE DISCREPANCIES IN THE STORE ACCOUNTS OF THE POLICE DEPARTMENT.
78. In August and October, 1927, stock was taken of all articles in the Stores at the Central Police Station.
This stocktaking covered 661 types of articles and disclosed surpluses to the total value of $7,493.78 in 147 types of articles, and deficiencies to the total value of $5,977.86 in 172 types of articles.
With the exception of a stocktaking in the Arms and Ammunition Groups in 1924, when discrepancies in those Groups were adjusted, there had not been any stocktaking in these stores since January, 1923, when surpluses to the value of $16,459.49 were taken on charge, and deficiencies to the value of $3,788.47 were written off.
The discrepancies revealed by the 1927 stocktaking were therefore the accumulated discrepancies of four and a half years.
79. In the absence of stocktakings during that period we find it impossible to state definitely how or when these discrepancies arose; but it seems highly probable that many are attributable to the conditions which prevailed during the strike and boycott periods, when issues were made and stocks handled in circumstances which militated against the keeping of accurate records.
The difficulty in ascertaining how and when the discrepancies arose has been increa- sed by the fact that, in 1925, there was a change of storekeepers, and that, on this change taking place, there was no stocktaking and formal handling over to the new store- keeper.
This places it beyond our power to determine what person is responsible for the causes of the discrepancies.
An excellent opportunity for ascertaining the true state of the stocks arose in the spring of 1925 when all stocks were transferred to a new store, but, though the articles were checked out of the old store into the new store with a view to ensuring that there was no loss in transit, the figures thus ascertained were not then or later compared with the stock book figures.
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