TAX EVASION.

Auckland Star, Volume LXVI, Issue 58, 9 March 1935, Page 9

TAX EVASION.

U.S.A. LAW SUIT.

SENSATIONAL TURN.

Mr. Mellon Charged With Large-Scale Avoidance.

HOOVER MINISTER.

(United P.A.-Electric Telegraph-Copyright)

(Received 11 a.m.)

NEW YORK, March S.

The suit brought by Mr. Andrew Mellon, the millionaire Secretary of the Treasury in the Hoover Administration, to clear his name of alleged income tax evasion, reached a climax at Pittsburgh to-day when the Government counsel offered to prove that the Union Trust Company, which Mr. Mellon controlled, was "the hub of a giant wheel of tax avoidance."

He said that officials of the company, through various subsidiaries, made deals to show huge capital losses for the sole purpose of evading taxes. Such trans-

actions "cost the Treasury millions of dollars in lost revenues," he said. Mr, Mellon and his legal advisers were obviously perturbed at the charge and asked an adjournment to study the legality of the admission of such evidence, and this the Court granted. Mr. Mellon also sues to recover about 139,000 dollars, alleged to have been over-paid in income tax in 1931. The action has been instituted to clear Mr. Mellon of the charge of fraud which the Government unsuccessfully laid against him last May. The Government's counsel now will attempt to prove in open Court that Mr. Mellon owes about 3,000,000 dollars on income they allege he failed to declare for taxing purposes in 1931. In his opening address Mr. Mellon's counsel stated that, whereas plaintiff paid 047,000 dollars, he could legally have avoided paying anything by showing his security losses and contributions to charity.