Sessional_Paper_1893 — Page 549

HONG KONG.

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8. It is for this failure as regarded the 1890 Rent Roll that the Commission has found me to blame.

9. His Excellency is already aware that, regarding the arrear as I unfortu- nately did, as of a clerical nature only, I allowed myself to be imposed upon by ALVES' plea of overwork, and did not insist, as I should have done, on the book being promptly balanced and submitted for audit. I have elsewhere expressed my deep regret that, by my failure to appreciate the importance of this necessary check, the discovery of the existence of defalcations was unduly delayed.

10 As regards the receipt of Crown Rents by ALVES (the other point on which the Commission consider me to blame) I still maintain that it was perfectly possible for him to take payment repeatedly without my detecting it. Oc- cupying a room by himself as he did, he was only occasionally under my observation, and, even had I detected him in the act of receiving money, I might well have imagined that it was a private payment from some of the tenants of his own houses.

11. With reference to my letter of 22nd March, 1892, it might perhaps have been urged that, as the Treasurer has now only Treasury duties to attend to, he ought to have sufficient time at his disposal to enable him to check revenue, at any rate to a considerable extent, irrespective of whether the same work is being also performed by the Local Auditor or not.

12. I am unable to say with what expenditure of time over their duties former Treasurers were satisfied, but, (apart altogether from the question of the utility of performing the same work twice over) I can unhesitatingly assert that, now that the requirements of Somerset House have to be complied with, and that, owing to the withdrawal of the Audit Office and subsequently the Reference Clerk from the Colonial Secretary's Office, every document connected in any way with finance is now sent to the Treasurer for his consideration, I find, so far, that the work proper of the Treasurer takes longer than that of the Superintendent of the Gaol, the Police Magistrate, or the Registrar General (as all of which I have served,) while my late locum tenens assures me that he found it much more arduous than that of the post he at present occupies-Captain Superintendent of Police.

N. G. MITCHELL-INNES,

(Secretary of State to Governor.)

Treasurer.

SIR,

DOWNING STREET, 26 July, 1893.

I have given very careful consideration to your Confidential despatch of the 26th of April last reporting upon the serious defalcations which have occurred in the Hong Kong Treasury, and enclosing copies of the Report of the Commissioners appointed to inquire into the matter, and of correspondence with Public Officers arising out of that Report.

2. It appears from these papers that ALVES, the late first Clerk in the Trea- sury,

embezzled in the course of the five years, 1888 to 1892, nearly $63,000 of public money, and the circumstances which enabled him to do this are very clearly explained by the Commissioners, to whom the Colonial Government is indebted for a very careful and clear Report. I concur in their conclusions as to the persons who, by neglect or omission of duty, allowed the frauds to be committed. Omitting the names of minor delinquents, the officers chiefly to blame were :—

(i) The late Mr. LISTER, for authorizing ALVES to sign receipts, for engaging a Shroff, who could not read English, and for failing to cause the Rent Roll to be made up at the proper time, although this omission was brought to his notice by an Audit clerk.