VIII
THE FORGER
We were lunching with Stevenson Williams, a friend of Kennedy"s, at the Insurance Club, one of the many new downtown luncheon clubs, where the noon hour is so conveniently combined with business.
"There isn"t much that you can"t insure against nowadays," remarked Williams when the luncheon had progressed far enough to warrant a tentative reference to the obvious fact that he had had a purpose in inviting us to the club. "Take my own company, for example, the Continental Surety. We have lately undertaken to write forgery insurance."
"Forgery insurance?" repeated Kennedy. "Well, I should think you"d be doing a ripping business--putting up the premium rate about every day in this epidemic of forgery that seems to be sweeping over the country."
Williams, who was one of the officers of the company, smiled somewhat wearily, I thought. "We are," he replied drily. "That was precisely what I wanted to see you about."
"What? The premiums or the epidemic?"
"Well--er--both, perhaps. I needn"t say much about the epidemic, as you call it. To you I can admit it; to the newspapers, never. Still, I suppose you know that it is variously estimated that the forgers of the country are getting away with from ten to fifteen million dollars a year. It is just one case that I was thinking about--one on which the regular detective agencies we employ seem to have failed utterly so far. It involves pretty nearly one of those fifteen millions."
"What? One case? A million dollars?" gasped Kennedy, gazing fixedly at Williams as if he found it difficult to believe.
"Exactly," replied Williams imperturbably, "though it was not done all at one fell swoop, of course, but gradually, covering a period of some months. You have doubtless heard of the By-Products Company of Chicago?"
Craig nodded.
"Well, it is their case," pursued Williams, losing his quiet manner and now hurrying ahead almost breathlessly. "You know they own a bank out there also, called the By-Products Bank. That"s how we come to figure in the case, by having insured their bank against forgery. Of course our liability runs up only to $50,000. But the loss to the company as well as to its bank through this affair will reach the figure I have named. They will have to stand the balance beyond our liability and, well, fifty thousand is not a small sum for us to lose, either. We can"t afford to lose it without a fight."
"Of course not. But you must have some suspicions, some clues. You must have taken some action in tracing the thing out, whatever is back of it."
"Surely. For instance, only the other day we had the cashier of the bank, Bolton Brown, arrested, though he is out on bail now. We haven"t anything directly against him, but he is suspected of complicity on the inside, and I may say that the thing is so gigantic that there must have been some one on the inside concerned with it. Among other things we have found that Bolton Brown has been leading a rather fast life, quite unknown to his fellow-officials. We know that he has been speculating secretly in the wheat corner that went to pieces, but the most significant thing is that he has been altogether too intimate with an adventuress, Adele De-Mott, who has had some success as a woman of high finance in various cities here and in Europe and even in South America. It looks bad for him from the commonsense standpoint, though of course I"m not competent to speak of the legal side of the matter.
But, at any rate, we know that the insider must have been some one pretty close to the head of the By-Products Company or the By-Products Bank."
"What was the character of the forgeries?" asked Kennedy.
"They seem to have been of two kinds. As far as we are concerned it is the check forgeries only that interest the Surety Company. For some time, apparently, checks have been coming into the bank for sums all the way from a hundred dollars to five thousand. They have been so well executed that some of them have been certified by the bank, all of them have been accepted when they came back from other banks, and even the officers of the company don"t seem to be able to pick any flaws in them except as to the payee and the amounts for which they were drawn. They have the correct safety tint on the paper and are stamped with rubber stamps that are almost precisely like those used by the By-Products Company.
"You know that banking customs often make some kinds of fraud comparatively easy. For instance no bank will pay out a hundred dollars or often even a dollar without identification, but they will certify a check for almost any office boy who comes in with it. The common method of forgers lately has been to take such a certified forged check, deposit it in another bank, then gradually withdraw it in a few days before there is time to discover the forgery. In this case they must have had the additional advantage that the insider in the company or bank could give information and tip the forger off if the forgery happened to be discovered."
"Who is the treasurer of the company?" asked Craig quickly.
"John Carroll--merely a figurehead, I understand. He"s in New York now, working with us, as I shall tell you presently. If there is any one else besides Brown in it, it might be Michael Dawson, the nominal a.s.sistant but really the active treasurer. There you have another man whom we suspect, and, strangely enough, can"t find. Dawson was the a.s.sistant treasurer of the company, you understand, not of the bank."
"You can"t find him? Why?" asked Kennedy, considerably puzzled.
"No, we can"t find him. He was married a few days ago, married a pretty prominent society girl in the city, Miss Sibyl Sanderson. It seems they kept the itinerary of their honeymoon secret, more as a joke on their friends than anything else, they said, for Miss Sanderson was a well-known beauty and the newspapers bothered the couple a good deal with publicity that was distasteful. At least that was his story. No one knows where they are or whether they"ll ever turn up again.
"You see, this getting married had something to do with the exposure in the first place. For the major part of the forgeries consists not so much in the checks, which interest my company, but in fraudulently issued stock certificates of the By-Products Company. About a million of the common stock was held as treasury stock--was never issued.
"Some one has issued a large amount of it, all properly signed and sealed. Whoever it was had a little office in Chicago from which the stock was sold quietly by a confederate, probably a woman, for women seem to rope in the suckers best in these get-rich-quick schemes. And, well, if it was Dawson the honeymoon has given him a splendid chance to make his get-away, though it also resulted in the exposure of the forgeries. Carroll had to take up more or less active duty, with the result that a new man unearthed the--but, say, are you really interested in this case?"
Williams was leaning forward, looking anxiously at Kennedy and it would not have taken a clairvoyant to guess what answer he wanted to his abrupt question.
"Indeed I am," replied Craig, "especially as there seems to be a doubt about the guilty person on the inside."
"There is doubt enough, all right," rejoined Williams, "at least I think so, though our detectives in Chicago who have gone over the thing pretty thoroughly have been sure of fixing something on Bolton Brown, the cashier. You see the blank stock certificates were kept in the company"s vault in the bank to which, of course, Brown had access. But then, as Carroll argues, Dawson had access to them, too, which is very true--more so for Dawson than for Brown, who was in the bank and not in the company. I"m all at sea. Perhaps if you"re interested you"d better see Carroll. He"s here in the city and I"m sure I could get you a good fee out of the case if you cared to take it up. Shall I see if I can get him on the wire?"
We had finished luncheon and, as Craig nodded, Williams dived into a telephone booth outside the dining-room and in a few moments emerged, perspiring from the closeness. He announced that Carroll requested that we call on him at an office in Wall Street, a few blocks away, where he made his headquarters when he was in New York. The whole thing was done with such despatch that I could not help feeling that Carroll had been waiting to hear from his friend in the insurance company. The look of relief on Williams"s face when Kennedy said he would go immediately showed plainly that the insurance man considered the cost of the luncheon, which had been no slight affair, in the light of a good investment in the interest of his company, which was "in bad" for the largest forgery insurance loss since they had begun to write that sort of business.
As we hurried down to Wall Street, Kennedy took occasion to remark, "Science seems to have safeguarded banks and other inst.i.tutions pretty well against outside robbery. But protection against employees who can manipulate books and records does not seem to have advanced as rapidly.
Sometimes I think it may have lessened. Greater temptations a.s.sail the cashier or clerk with greater opportunity for speculation, and the banks, as many authorities will agree, have not made enough use of the machinery available to put a stop to embezzlement. This case is evidently one of the results. The careless fellows at the top, like this man Carroll whom we are going to see, generally put forward as excuse the statement that the science of banking and of business is so complex that a rascal with ingenuity enough to falsify the books is almost impossible of detection. Yet when the cat is out of the bag as in several recent cases the methods used are often of the baldest and most transparent sort, fict.i.tious names, dummies, and all sorts of juggling and kiting of checks. But I hardly think this is going to prove one of those simple cases."
John Carroll was a haggard and unkempt sort of man. He looked to me as if the defalcations had preyed on his mind until they had become a veritable obsession. It was literally true that they were all that he could talk about, all that he was thinking about. He was paying now a heavy penalty for having been a dummy and honorary officer.
"This thing has become a matter of life and death with me," he began eagerly, scarcely waiting for us to introduce ourselves, as he fixed his unnaturally bright eyes on us anxiously. "I"ve simply got to find the man who has so nearly wrecked the By-Products Bank and Company.
Find him or not, I suppose I am a ruined man, myself, but I hope I may still prove myself honest."
He sighed and his eyes wandered vacantly out of the window as if he were seeking rest and could not find it.
"I understand that the cashier, Bolton Brown, has been arrested,"
prompted Kennedy.
"Yes, Bolton Brown, arrested," he repeated slowly, "and since he has been out on bail he, too, seems to have disappeared. Now let me tell you about what I think of that, Kennedy. I know it looks bad for Brown.
Perhaps he"s the man. The Surety Company says so, anyway. But we must look at this thing calmly."
He was himself quite excited, as he went on, "You understand, I suppose, just how much Brown must have been reasonably responsible for pa.s.sing the checks through the bank? He saw personally about as many of them as--as I did, which was none until the exposure came. They were deposited in other banks by people whom we can"t identify but who must have opened accounts for the purpose of finally putting through a few bad checks. Then they came back to our bank in the regular channels and were accepted. By various kinds of juggling they were covered up. Why, some of them looked so good that they were even certified by our bank before they were deposited in the other banks. Now, as Brown claims, he never saw checks unless there was something special about them and there seemed at the time to be nothing wrong about these.
"But in the public mind I know there is prejudice against any bank official who speculates or leads a fast life, and of course it is warranted. Still, if Brown should clear himself finally the thing will come back to Dawson and even if he is guilty, it will make me the--er--the ultimate goat. The upshot of it all will be that I shall have to stand the blame, if not the guilt, and the only way I can atone for my laxity in the past is by activity in catching the real offender and perhaps by restoring to the company and the bank whatever can yet be recovered."
"But," asked Kennedy sympathetically, "what makes you think that you will find your man, whoever he proves to be, in New York?"
"I admit that it is only a very slight clue that I have," he replied confidentially. "It is just a hint Dawson dropped once to one of the men with whom he was confidential in the company. This clerk told me that a long time ago Dawson said he had always wanted to go to South America and that perhaps on his honeymoon he might get a chance. This is the way I figured it out. You see, he is clever and some of these South American countries have no extradition treaties with us by which we could reach him, once he got there."
"Perhaps he has already arrived in one of them with his wife. What makes you think he hasn"t sailed yet?"
"No, I don"t think he has. You see, she wanted to spend a part of the honeymoon at Atlantic City. I learned that indirectly from her folks, who profess to know no better than we do where the couple are. That was an additional reason why I wanted to see if by coming to New York I might not pick up some trace of them, either here or in Atlantic City."
"And have you?"
"Yes, I think I have." He handed us a letter-gram which he had just received from Chicago. It read: "Two more checks have come in to-day from Atlantic City and New York. They seem to be in payment of bills, as they are for odd amounts. One is from the Lorraine at Atlantic City and the other from the Hotel Amsterdam of New York. They were dated the 19th and 20th."
"You see," he resumed as we finished reading, "it is now the 23rd, so that there is a difference of three days. He was here on the 20th. Now the next ship that he could take after the 20th sails from Brooklyn on the 25th. If he"s clever he won"t board that ship except in a disguise, for he will know that by that time some one must be watching. Now I want you to help me penetrate that disguise. Of course we can"t arrest the whole shipload of pa.s.sengers, but if you, with your scientific knowledge, could pick him out, then we could hold him and have breathing s.p.a.ce to find out whether he is guilty alone or has been working with Bolton Brown."
Carroll was now pacing the office with excitement as he unfolded his scheme which meant so much for himself.
"H--m," mused Kennedy. "I suppose Dawson was a man of exemplary habits?
They almost always are. No speculating or fast living with him as with Brown?"
Carroll paused in his nervous tread. "That"s another thing I"ve discovered. On the contrary, I think Dawson was a secret drug fiend. I found that out after he left. In his desk at the By-Products office we discovered hypodermic needles and a whole outfit--morphine, I think it was. You know how cunningly a real morphine fiend can cover up his tracks."