CHARGE OF THEFT.

Grey River Argus, 6 November 1928, Page 8

CHARGE OF THEFT.

Against County Official. COSTELLOE REMANDED TO SUPREME COURT. The Grcymc/uth Magistrate’s Court, presided over’by Mr W. Meldruin, S.AT. occupied yesterday mojrning m hearing - the case against Dennis Costelloe, formerly Assistant Clerk to the, Grey County Council. Accused was changed with thc< theft on divers dates between May sth. 1927 and August 26. 1922 of -fTGI 0s 6d, the property of the Grey County Council, while employed as Assistant Clerk to. that body. Detective H. March handled the prosecution and Mr W. J.. Joyco appeared for accused. The first witness called for th*c pros \cution was Alfred Thomas Birchfield, manager of the Lake Brunner Sawmill Co., He Stated that the cheque produced amounting to £lO7 19s 6d wiajei forwarded to the Grey County Council by his company in payment of timber levy. A receipt had not been received in acknowledgemviit through the company. No questions were asked by the defence.

John Gilbert, a partner in the firm of 'Gilbert- and Tomasi, c'ontiractors, Kumara said the cheque produc'p in c“,urt for ( an amount of £5 payable to the Grey County Council was for payment of a d posit on a contract. .z\ receipt for the amount had not been received and h? had not received a fund of the deposit. Vivian Theodore Lloyd, a farmei residing at Tercmakau Settlement re cognised thd eJieqlUA for £7 17/- jf/rodueed iu court and. dated 28th March 1928 as made put ’by him to the Grey County Council in payment of rates ofl ' behalf 'of Morel and others. Noreccipt had" been received. Edward Lewis Morgan, a farmer and licensee of the Lake Brunner Hotel at Mitchells- stated that the tharj cheque (produced) dated 19th 28 and ‘amounting to £46/17/- was forwarded by him to tint Grey County Council in payment of rates. A fur then* chequci (produced) doited 19th April 1927 for £2O was forwarded bhim to the same County Council for the payment of rates. Receipts had not b en received in acknowledgement for either of the cheques.

Arthur Donncllan, a sawmiller in business in. Nelson Creek, recognised the cheque produced in court dated 10th April 1927 for £56/5/3 as one mad i out by his firm to the Grey County Council for the payment of a traction lieens? (£5O) and rates due (£6/5/3. He could not say whether a rt.o ;ipt had been received for the amounts.

Jahn Spiers Robinson, shipping ag nt of Greymouth, stated that he manager of the Aritiki Sawmilling Co and the cheque produced to him in court dated 28th March 1928, for an amount of £2l/17/7 was forwarded by him to the Grey County Council in payment of timber levies due. A receipt had hot b fen received. Micheal Joseph Phillips, clerk in the employ of Messrs 1 M. J. Fogarty ana Co said the cheque produced to him for £l4 and dated sth Ma y 1927 was forwarded tor the Greymouth County Council in payin' .nt of compensation monies. The sec'ond cheque also pro duced, for £5 13/- and dated 10t'« September 1927 was- forwarded to th same County Council iL. payment of compensation monies. A third cheque (produced) and dat'd 10th April 1928 for i*n amount of £l-72/- was forwarded to the Grey County Council as a payment ’on behalf of the Greymouth Juekey Club for a publican s conditional license. The receipts for the cheques repres.nting the cod«~ pensation monies would be on the com pany’s form of receipt, whil? in Ibe matter of the publican’s conditional license, the granting of the license would be c’onsideicd a sufficient receipt. John Martin Bunt, an accountant in business in Mackay Slre..t, Greyindutiis stated he was the account-agit to the Om,oto Sawmilling Co. The cheque produced for £2B 14s 6d and dated 18th Apri. 1928, was forwarded to un; Grey County Council in payment, timber levies du > by the company, N<> receipt had, as far as he knew, been received for the amount. He is ats‘> Secretary of the New Z aland Timber, Ltd., and t-he cheque (produced), dat®* l 17th May 1928, for £4 16s was torwarded to the Grey County Council by ins company in payment of timber levies. He was unable to trac a receipt for the payment. Alma Flewellyn, a clerk in tue em ploy of W. P. MeCartny, barrister and solicitor of Greymouth, recognised a cheque (produc d) dated 25th February, 1928, and for £/ 15s which had been forwarded tej the, Grey County •Council on behal'f ot inc Briamlaic Collieries, _ Ltd., in payment of <-o«levies due by the. company to th<& Council. A r ceipt for the money had not been received.

Hope Cecilia Allen said' she was -x member of the firm known as the Moonlight Sawmilling Co. The cheque produced and dated 11th Jun-, 19«7 fur £l3 was forwarded, to the Gle County Council by her firm in payin' n of heavy traffic license. A further cheque (produced) dated 13th Apn. 1928, for £4 was also forwarded to the same County Council in- paym nv ->f timber levies due to the County b.y thei firm. Receipts had not been received in either casfe.

Fred rick Hamilton Kilgour, Manager olf the Greymouth Evening 'Star, said he was also Secretary and Treasurer to the Greymouth Rae cours . Trustees. The cheque "for £36 9s 6d (produced) dated 14th March 1928, was forwarded to th" I Grey County Council in rates. A receipt had not been received.

Thomas Patrick Ryan, c*erk employ cd by the firm of Messrs Hannan and Seddon, Solicitors, Greymouth, recognised the cheque produced for £25 an-' dated 2|oth June, 1928, as the one for ward' d to’ the Grey County Ceuncn on behalf of one Anne Fox, Ahaura, i ll payment 'of a. hotel license. A second chequ (produced) for £lO and dated 22nd June, 1928, was also forwarded to the same County Council bn bcha-f of one G '.orge Burger, of Paroa, in payment of a hotel license. The oB, y receipts received were the licenses t,homselv?)S.

Leonard George Reginald Dcwe, Secretary of the Kumara Timber Ltd , stated the cheque produced to him fo? £5 and dated 2nd March, 1928, was forward'd to the Grey County Council in payment of a tramway license fee. A receipt had n.qt been received in respect of same. Wiliam Ross McCullough, Government Auditor, stated that on th ' 22nd August last, hei commenced the annua* audit of the books of the Grey County Council. The first thing he did was to count tli«e <a« H h. Unon checking the

receipts issued and the bank lodgments he- discovered a shortage ot cash amounting to £72 12s 3d. Accuser was present when he counted the cash* Accused wjas then employed as a clerk to the Grey County Council. Witness then secund th credit slips from the National Bank of New Zealand, an-> by checking the individual cheques lodged, with the receipts issued an-1 amounts shown due by sundry debtors, he discovered amounts had been received withorut credit being given to the payers. These amounts were still •town as outstanding and were nor credited in the books. In reply to question by Detectiv<‘ March, witness stated that when cash or cheques wuie xeceived at the office the necessary procedure is to issue an official receipt except in the case of drivers’ licenses arid heavy traffic licenses. If a heavy traffic license was- in arrears, th ait is to say the period of licena i had expired, aid the mojney was then paid for a renewal of the lie /use, a receipt shdiiTd be issued, and the amount credited to the payer in the County books. All cash should be banked r* ■ gularly once a- week and in full. During his previous audit the banking lia-t been irregular and he had pointed our to the County Clerk and Costelloe. *hafT the banking should be done jegu lorly. He had received their assurance that this would be so. His instrue tions had not been carri d out. Regarding the practice of payment of wages, in respect ef cases where difficulty in getting cheques signed by Council members, wages would be pain cut of cash r.'iceipts and the County’s cheque drawn to make g<«>d that ease. He discovered from invi isfigations, r hat all the banking had been done by the accused. Very little cash in the natuf~ of money and coinj was ever banked. Witness produced the bank lodgment slips from 7th April 1927._tu JiTth August, 1928. All the deposits were iq accused’s handwriting. Very little cash had been banked. The cheques produced yepr isented most of the lodgments. Describing the mode of operation respecting the witness said tTicst peo-pie paying in cash at the office would get a receipt for the payments which would be ie voided in the books. As the cash was not banked in full, presumably ft was. extracted and the accused would barnk cheques which had been r./j-.eived and fur which’ no receipt was issued, to. make good the shortage of cash. Thai would balance his cash, but would leave parties paying cheques, still represented as owing money to tli County—He confirmed his supposition by sending out accounts to all debtors. The cheque produced, made to V • Burns and da,tell 26th May, 1927, was in payment -of a r -fund of deposit to William Burns and Mrs Mclnroe £lO ekeh. There were no vouchers in support oi* these payments although the cheque was presented at the bank, ■t'he ch que paid by Mr Forrest into the County for a deposit on a contract did not go through the County books. The total amount represented as shojrt is £7Ol 0s 6d. hud been used to cover up dcTalcatious of ‘•ash. Defalcations appeared to hav commenced in May 1927 and continued up until the date of the audit. Ou 7th April 1927 until 17th August, 1928, the banking had taken place about once a month except during March.

To Mr Joyce: I si nt out debit notes fur rates aud other accounts datuq. back over a period of the last three years, and for a larger terms in the cxise of some otlfrr amquuts. I have heard some af the- evid ince given by witnesses regarding cheque£> paid 'u and no receipts were given. All these cheques were paid into th> i bank. The bank cheque for £3O dated 2nd July, 1928, went through the County ’s bank. As a receipt is issued the amount should be carried out, in the cash book. An entry should b ' made in the appropriate book after the payment of each amount. It is laid down that banking must be made once a week or more frequently if a large sum is in hand. ,

Mr Joyce: A w.,ek may go by and nothing be received, then several hundreds of pounds will come in.? — Yes.

Michael Keating, County Clerk, iu the employ of the Grj y County Cou.*.-.-cil said he knew the accused, who had been employed by the County for about fifteen years. Accused’s? salary for the- last six months of his mployment had bieen £5 10s per week. Four years before that it had been £4 10s per yeek with a commission ion license B coll cted. The commission receive-i would be about £5O or £6O a year in addition, to his salary. Costelloe’s duties were those of Assistant Clerk Ha was in charge of the public offic and received all cash and issued r - eeipts fo;r payments made. He had full charge of all monies, aiid held the key of the strong room and cash box. In the event of accua -d being absent, witness would receive cash and then hand it in to Costelloe later. Accused had sole charge of the bank ing and 'did the whol / of it fc,r the last four years. Witness signed any County check® iasund. and endorsed cheques needing endbrscmdnt before banking. Cheques received through the post” witness wcjuld endorse and hand to Costelloe. The issuing of re g iipts was Costelloe’s work. With regard to motor” lorry licenses, witness had full charge of that. » The fees were collected by the Traffic Inspector and handed to Costelloe, g nerally in the Inspector’s presence. • --Thio County cheque produced was a payment evidently in respect of two d - posits of W. Burns and E. J. Mclnroe and was refund, of such deposits. The cheque for £l5 dated 27th March, 1927, was drawn for an amount pwing to cine F. Donovan for a right of w*iy for three years. . A receipt for the amounts being . a contra account, should have been issued. The same app’ied to the cheque payable to *A Newcombe for. £lO issued on st)i August, .1928, it being .also a contra account. All money was kept in th strc(ng room except a small amount of change which; was kept in the oTTce till. The alleged shortage was £7Ol Os 6d. No other person in the office would be r)'-sponsible., for the shortage excepting accused.

To Mr Joyce: In- respect to the cheques to Doncwan and Newcombe, the amounts wore payable for work domx Vouchers should be issued wrwn ehi.'ques w p re issued. The cheques werc .paid into the County account and no receipts were issued for them. Both Dcicjvan’s and. N> wcombe’s cheques were cashed over the County counter.

William Burns ,a road contractor, residing atl Nelson Creek said he wnipd receive payment for work don * through the Grey Oo<untv Council. He received) payments by cheque. The chpciue produced fnr £2O mad-. out to W. Burn? was never received by him. Hwas- not a#are that any monev was due to him by the County Office. He received a visit from accused, came buL Bell Hill about 10

o'clock one night-, sometime in August. He was in bed. Accused cam., up for him to sign a voucher for £1 (saying Mr Higgin’s, County Engineer, sent him), for work be had don on the Bell Hill Road. Witness remarked: “ Why didn’t you send it up this morning with Caulton?” Accused replied: “The Auditor had not found out the mistake th'in.” Witness signed the receipt and handed it back to accused. He did not mention any more about it. He thought he had drawn everything due to him by th County. ,

John Higgins County Engineer, employed by the Grey CounFy Council, said, that he had never instructed Ccfctelloe to visit Burns at Bell Hill, for tbu purpose of obtaining Burns signaturv to any vouchers. Margaret Agnes Mclnroe, a widow, residing in Murray Street. Greymouth, stated that her husband, who was killed four years ago, had been a contractor, and had dope a good d; al of work for the Grtey County Council. Since the death of her husband she had not received any money from the Grey County Council, and did not know that any money for heq husband at the County Offie.-, Detective Murch, deposed that on the sth September last, he interviewed accused at the detective office, and informed him that it was alleged he had failed to account for £647 7s 6d, the property ""of the Grey County CouncilHe him. if he wished to mak' any statement dr any explanation, and accused replied that he did not wish to answer any questions or makn a statement. Witness then -. arrested accused on a warrant. Accused pleaded not guilty and reserved his defence. He was committed for trial at the next sitting of th.. Supreme Court at Greymouth. Bail not being opposed, was allowed as previously, being fixed at £2OO with two additional sureties of £lOO each.