FROM GAOL TO WITNESS-BOX TO ADMIT DISHONOR "THOUGHT HIM LOVELY MAN"

NZ Truth, Issue 1253, 5 December 1929, Page 9

FROM GAOL TO WITNESS-BOX TO ADMIT DISHONOR

"THOUGHT HIM LOVELY MAN"

Woman Victim of Heartless Fraud Trusted Her

Money To Whitehouse To Her Sorrow

DID HE ACT-AS COMPANY'S SECRETARY?

(From "N.Z. Truth's" Special ■Wellington Representative).

Claiming that she had paid various sums totalling £600 to Walter Whitehouse, when he | was secretary of the Te Aro Loan & Discount Company, arid who is now serving a term of | imprisonment for his defalcations m connection with that concern, Annie Elizabeth Cooper; | brought an action against the loan company claiming repayment of the money plus interest | at the rate of 20 per cent. . ■ r I Whitehouse, who gave evidence, was subjected to a very probing cross-examination | and at times took refuge m silence or m the terse reply, "I can give no explanation." 1

HE admitted that an amount of £2300 had -Tjeen paid to him by four different people, including Miss Cooper, and that he had personally spent the whole of this money liquidating his own debts. In her claim Miss Cooper asked the court to order the repayment of £ 600 plus interest at the rate of £10 per month from March, 1929, less £5 paid on account of interest m March, 1929. Annie Elizabeth Cooper said she was single and living m Adelaide. Road, Wellington. Prior to 1922 she had been m business m Cuba Street, as a milliner, and her shop was m the same building as that of the office of the Te Aro Loan and Discount Company. ' Owing to bad health she had had to give up her business m 1922 and at that time Walter Whitehouse, secretary of the Te Aro Loan and Discount Company, whom she had known for a number cf years, asked her if she would lend her money to tho company of which he was secretary. ! This was the Te Aro Loan Company. He told her that it would be quitesafe there and that she would get good interest on it. Her First Payment "I thought he was a lovely man," Miss Cooper told his Honor m answer to a query regarding the lei%th of time she had known Whitehouse. It was m June, 1922, that she had made her first payment to Whitehouse for investment m the Te Aro Loan Company and the amount was £100. Subsequently, 'between August and October of the same year she had paid to Whitehouse for investment with the company sums amounting: to £500 making a total of £600 altogether. In each instance Whitehouse had given her a, receipt for the money and this receipt was on a printed form which was the official form of the Te Aro Loan and Discount Company. After she had paid her first £100 Whitehouse told her that she would receive interest at the rate of £ 5 per month and she was paid this sum each month until she had paid £600. From that time onwards, November, 1922, she received payment at the rate of £10 per month.. This interest was paid to her by the company's cheque on the first of each month. She had gone to see him at that time, to get her £10 interest, but he had asked her to come back again next day. She had previously handed him her receipts asking, him to take care of them and he "gave her a promissory note for £605. _ This document he dated December 21, 1928. although the date on which she, Miss Cooper, had received it was March 2. 1929. Cross-examined by Mr. Nielsen, Miss Cooper said she had not mad! any inquiriss as to the assets of the Te Aro Loan and Discount Company before investing her money. She had got a printed form of receipt signed only by Whitehouse for every payment she made. Mr. Nielsen: How was this .money to be repaid? — There was no fixed date of repayment. Miss Cooper said that she remembered meeting Mr. Rodd, chairman of directors of the company, at Mrs. Coombes's house.

Mr. Nielsen: Did you say: "How is Walter"? — I did not. I might have said: "How is Mr. Whiten ouse, not Wulter." Did you say: "Do you think he has anything?" to which Mr. Rodd replied that he thought Whitehouse had something?' I did not. He never said anything of the sort. Did you say to Mr. Rodd: "I don't think he has an atom?" — I did not say those words. No conversation had taken place between Mr. Rodd and herself concerning'Whitehou.se when they met at Mrs. Coombes's home. The defence was a denial that the sum of £ 600 had been paid to the company qr any of its agents, and a further denial that Miss Cooper had ever made • a demand for repayment, Whitehouse had been dismissed from the company's employ for theft, and it was submitted that if moneys were paid to him 'by Miss Cooper then he received them 1 m his personal capacity. It was also submitted by the defence that if money, was received by Whitehouse as the company's. agent then it was claimed that by, or m consequence of a series of acts on Whitehouse's part, concurred m by Miss Cooper or facilitated by the absence of care on her part, the moneys paid by her were lost by his , Further, .that by having accepted Whitehouse's personal liability Miss Cooper was stopped from proceeding against th 6 company. David Rodd, a director of the Te'Aro

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Loan and Discount Company with office^ at Cuba Street, said he had been the chairman for the .past 11 years. Walter Whitehouse, said 'Rodd, had i followed his father as secretary of the company, and had <been holding that , position for about 20 years. " His Hohpr: There were no, other employees? — No. -'•■ - • He was the only person then to whom people could appeal when they ; went into the office on business? — Yes. Rodd said that according to the Ar- , tides of Memorandum two directors i formed a quorum. The. directors of the company had held meetings as the occasion arose. Since his election as chairman the company had accepted only two or three. deposits on loan and those amounts had been from shareholders. The secretary was not authorised to accept deposits without reference to the directors. The company's rate of iriterest was 6 per V cent, per annum interest on deposits, i . . | He had never heard "of Miss Cooper m connection with the. company until he met her at the house, of a mutual - friend, Mrs. Coombes. That was the firvst time he knew of her. y "She asked me how Walter was,"] said Rodd, "and- I replied: 'Who is Walter?'" ■ , . .. Miss Cooper had then said to him:* "Do you think he has got anything?" to which he had replied: "Yes, he is a : wealthy man." That was the only remark that passed between Miss Cooper and himself. His Honor: You and she had never met before and iust asked you casually about Whitehouse? — Yes. • Rodd stated that he had never seen • the lettqr written. by Mr. Perry's firm on behalf of Miss Cooper demanding ' the return of Itev money. Questioned by his Honor about the signing of cheques he said that he had ! been m the habit of sisrning a number of cheques made payable to a number 1 instead of to the- person to whom the money, was- heing paid. . His Honor: Well, how can you ; say, if these cheques were made payable to a number, whether you 1 ever signed a cheque payable to Miss Cooper? Rodd replied that j the practice was to check the num- ; ber against the name on the butt.. 5 His Honor: Did Whitehouse's defalcations •with .-the company include forgery? — No, I don't think so. It was '. embezzlement. I suppose it would be quite a simple thing for the butts- to be made out to t any name while the cheque showed > simply a number? Mr. Nielsen interrupted to say that it . was hardly likely that there would ■ be such a substitution each month as a regular thing -: without, it being de- : tected, but the judge intimated that it was possible, where a person set out to work such a scheme. Books Were Falsified Mr. Nielsen: Well, so far as . you know you never signed a cheque Intended for Miss Cooper? — No. Cross-examined by Mr. Perry, Rodd said that he and his directors had made it a practice \p check off the receipts on the cheque butts. . He had never seen any book m the company's, office m which a number of people had signed receipts . for money , paid to ' them. Mr. Perry: When did the directors first discover the" defalcations m the accounts? — 'Mr. Mclntosh, public accountant, first discovered, them m June. His Honor: How long had .this been going on? — For some .years. . So that Mr. Whitehouse evaded the vigilance of his directors and auditors for some years? — Yes. > Mr. Perry: I suppose you know that there had been some falsification of the books by Whitehouse?— Yes. Had any of the books been destroyed? — Not to my knowledge. Mr. Perry: v But you said the letter of June of this year written by my firm to the directors had never gone into their hands? — Yes. At that time Whitehouse was still employed by the company? — Yrr. His Honor (pointing to th_© butts of. a receipt book m his hand", and addressing Rodd) : I notirp: that ther* are .blank butts here, — absolutely blank. Witness: What date would that be, your Honor. His "Honor: There is no date on it. It is absolutely blank. For some years past there is no signature of any of the depositors.' . Rodd: I, have never seen . His Honor (indicating a number of blank butts) : If -you saw the book, Mr. Rodd, surely you must have seen these blanks? How do you account for those butts not being signed "by the depositors? — Well, I have only seen about two or three since I have been His Honor:, That is all nonsense. Here are dozens of them. (Turning rapidly the butts m the book.) Well, you don't seem to have taken nearly as much interest in' this company as you ought to have taken. . ' , : A public accountant, who made an audit of the books and discovered the defalcations, Thomas Mclntosh, stated that he could find no trace of any receipts being is.sued to Miss Cooper, or of any payments being made to her , save one for £ 10. - ' Under cross-examination Mclntosh said that 90 per cent, of the cheques that he examined which had been made out toy the company were made payable 'to a number and not. a name: His investigations had disclosed that Whitehouse's defalcations had extended over many years. The last signed balance-sheet he had seen signed by Mr. , Wilber force was May, 1923. His Honor: Well, that did not show i very much care on the part of the : directors. Mclntosh: I understand that what purported to be balance-sheets signed by Mr. Wilberforce were presented to ! the directors. ; ' His Honor: Whitehouse might have, forged Mr. "Wilberforce's signature? — - i He might have done j so.

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A short, middle-aged man, verybrowned, with a habit of lapsing into silence when' faced with certain questions, Walter Whitehouse. former secretary of the Te Aro Loan knd Discount Company, and now serving a sentence. of three years 1 imprisonment for embezzlement to which' ho pleaded

guilty several months ago, then gave evidence. ■ . ''■'.' ." It was over 10 years ago when he Urst met Miss Coor-er, who.was -then m business m Civba 'Street, he said. He had seen a good deal of her- In 1922 she had come ta' his office : ; and askfed him if ' he ' wanted any in pney. He agreed to take the' ; money which amounted to £250. v'-V; ;• /.: . His Honor: Did yoii tell her the money was received by you m your own capacity or on> behalf .of- .the company? — I gave;h>r a' receipt" on an ordinary piece of paper arid not a printed form. ; ' f^v ; : -^v:^' v He had not told her "that he was taking the money on behalf •■' of the company. "I deny that I ever received the receipts back from Miss Cooper for safe keeping," asserted Whitehouse. Altogether he had received from Miss Cooper £600 and each receipt for the various sums that made up this amount were gwen'in his own name. Counsel: What was the rate of interest you- were paying ?— Twenty per cent. , .'.,.. . His Honor: You did not tell her how you were going to invest it, or what you ; .wei'e going to do with the money? —No. •••.-■ ;; How was the interest paid? — By my own cheques. One cheque only of the company's, arid I explained why. I had neither cheque nor cash of my own and this cheque of the company's was* drawn against my salary. Shown the promissory note he had given Miss Cooper for £ 605, he admitted that at the time he had handed this to her. she had asked him for a receipt showing' the amount she had paid In as otherwise she had nothing to prove these payments. She had lost the receipts, sh& told him. His Honor: But you knew you had given her the receipts? — Yes, - but she said. she had lost them. . Well, why did not. you give her a mere "receipt;, that is what she asked you for? Whitehouse did not answer the question. Mr. Perry: Have you been m court during the hearing of the evidence? — Yes. " '..'■■ ■-''• • Did • you hear nic- reading a letter from my firm sent to the company? — ' Yes:- : \ v .\..v.'- ' ■'■■ :-'i'.';-'\fi "What did you d.O ; with it? — I destroyed it without showing it to anybody. ; . ...-'.:■• ■.-■•;;■"•"■." (The letter ief erred to was the letter of demand for the return of Miss Cooner's money.)" '•' ■■'■'■ . ' Did you do that because you did not want the. directors to know that you were dealings, with Miss Cooper ?-— I destroyed .it because I thought- itwasr. bluff. Whitehouse conceded that he could have shown the letter to the directors. His Honor:' You knew at that time your defalcations had been discovered? — Yes. .; ■ : : ■;.;.;}::;. .: v Whitehouse is Silent — — ~~ — - ■■■''* ' ' ■■"•,» It was at the time he told Miss Cooper that he was -In financial difn-. cuities that she said to him : "I suppose -my moneys-has gone." Mr. Perry: Did not you assure her then that her money would be all right?— No. Why did you date that promissory note December 21,/ 1928? — I have no explanation to make... . r . What did you do with this sum of £600 put m your hands by Miss Copper?— Used it to pay accounts. Did you use this money or any part of it for the purpose of covering up any defalcations? — No. Questioned' m regard to Miss Cooper's money Whitehouse said that he had obtained, it to invest on her behalf. • His Honor: Well, if you obtained this money to invest on her behalf, why should you pay her 20 per cent, interest, or. any other rate? (Silence.) Well, what do you s.ay? — I cannot answer that. question. . "I prefer to accept the plaintiff's evidence where there is any conflict," said his Honor. "Whitehouse was a. man m sole charge of this company's business and he was held out as transacting the company's business. I don't accept his statement that he gave receipts acknowledging moneys received from Miss Cooper! , His Honor said he would find these facts and any consideration of law which required to be argued must be argued on the basis of those facts. What he had said was not to be regarded as final decision, and he^ would hear argument later.