FRAUD CHARGE.

Auckland Star, Volume LXIV, Issue 68, 22 March 1933, Page 11

FRAUD CHARGE.

INSURANCE COMPANY. "OWNER" SENT FOR TRIAL BROTHER INFOKMS POLICE. (From Our Own Correspondent.) SYDNEY, March 17, few weeks ago reports were current here that the Criminal Investigation Bureau had in hand- "what is alleged to be one the most extensive attempts at company frauds in the history of the Commonwealth." The outcome has. been the appearance before the Court during the past week of four insurance company directors and clerks —Page, director, and C'orkhill, secretary, charged with having attempted to defraud shareholders in the Associated Dominions : Assurance Society by means of a "faked", balancesheet; and at. a later stage in the proceedings, these two defendants, along with Brain, another director, and Sydney Smith, an employee, charged with conspiring to defraud shareholders, and policy-holders of the Commonwealth Life Assurance Association. Page and Corkhill have been committed for trial on the original charge, and on the indictment for conspiracy the caee is still in progress. But so much public interest has been excited by the evidence already forthcoming, that some of the salient features of the case should be stated. Brother an Employee. At the outset, public curiosity was aroused by the fact that' information against Thaddeus- Page was supplied to tlie police in the first instance by his brother. Apparently it is quite legitimate for the Crown to take up a case on information provided from private sources. But the question of the informant's, motives naturally arises, and on this point Detective-Sergeant Lawrence supplied some rather sensational evidence. He stated that Frank Page, the brother of the accused, and one of the company's employees, had applied to Thaddeus Page, the director, for an increase in salary. Frank got no satisfaction and followed Thaddeus to* Melbourne to press lis claim. There he found Thaddeus living, so the detective said, with a girl Darned Hayes, 16 years old, the daughter of another of the company's employees. Frank Page then informed the police of certain facts on which the prosecution is based —alleging as his motive his wish to protect the girl and his desire to prevent his brother from wasting the company's assets in "riotous living." Naturally, a case started on such lines is open to various interpretations-, and counsel for Thaddeus Page not only ridiculed the idea that Frank Page was ictuated by any generous or honourable motive, but asserted that he is merely a tool in the hands of certain personal enemies of his brother. No doubt this riew of the evidence will be brought out more definitely later on. Page's Powers in Company. But the position of Thaddeus Page and iis method of handling the company's affairs have certainly laid him open to ! suspicion. Though the A.D.A.S. is nominally a- £250,000 company, it is, says counsel for the prosecution, "a one-man company practically owned and controlled by the defendant Page." The articles of association stipulate that Pago shall not be removed from Ms. post as managing director so long as he has 20,000 shares; and his salary was fixed at £2400 a year, with liberal commission and expense allowance. The other directors got £2 or £3 a week each, and the other company shareholders were either nominees, of Page or employees of the company holding contributing shares paid up to 3/, the calls being deducted,,from their weekly wages. It is evident that Thaddeus Page was in a position to handle ■ the company's affairs as he pleased; for Corkhill, the secretary, seems to have, been a.weakling who did as lie was told, and according to the prosecution "got very little out of it apart from his salary." Evidence by Accountants. It would not be advisable at this stage to criticise the evidence in detail, but some of the facts brought out under cross-examination were sufficiently sensational and surprising. It~is charged that in one balance-sheet liabilities' to the extent of over £100,000 were, cancelled—obligations being reduced from £330,000 to £200,000 with the stroke of a pen. An actuary employed by the company testified that when he had worked out the liability of the company at £246,000, Thaddeus Page told him, "This is no good to me—you will have to bring it down to a figure not greater than the assurance fund, £180,000." Another chartered accountant described the method of recording payment of calls by contributing shareholders as "dishonest and misleading." Another accountant stated that Corkhill had suggested to him the possibility of a "cut" amounting to , perhaps £10,000 if certain business could be put through with his help. Another witness, an insurance agent, who had examined into the company's finances, told the Court that Page bad impressed on him the need for cutting clown the liabilities, and stated that another actuary, having investigated the company's position, asked in , amazement, '"What sort of a man is this Page"? Is he a crook or a fool?" I presume that the rules against hearsay evidence are still rigidly maintained, but there is no doubt that this little quotation made Borne impression both in and outside the Court, and no one was .much surprised when after a hearing of nearly a week Thaddeus Page and Corkhill were committed for trial.