AUCTION FIRM'S METHOD

Taranaki Daily News, 3 October 1930, Page 9

AUCTION FIRM'S METHOD

ALLEGATION OF “BUYING IN” ALLEGED FALSE SALES ACCOUNT. EVIDENCE GIVEN BY AUDITOR. By Telegraph.—Press Association. Wellington, Last Nigui. Evidence for the prosecution in the case in which Laery and Co., Ltd., auctioneer and produce merchants, are charged under the Secret Coratn'.ssiops Act, 1910, was continued in the Magistrate’s Court. The charges against the firm are five counts of failing to disclose a pecuniary interest in a contract and two counts of delivering false sales accounts to the Department of External Affairs in respect to bananas; Mr. E. Page, S.M., was on the bench. Evidence was given by several fruiterers regarding purchases made by them from the defendant firm. John Michael Scott, inspector of the Government Audit Department, said he carried out an investigation of the records and books of the defendant company dealing, with the particular consignment of bananas winch arrived by the Maui Pomare in July, 1929, The account sales showed 31 cases sold for Ils. Witness traced the auction sheets and found an entry on July 30 for 26 cases of Samoan bananas booked to country departments at Ils a case. There was an entry showing.that five other cases of bananas had been sold to a Hindu hawker on July 29 at Ils a case.

Witness said the investigations proved that Laery and Co. were in the habit of taking cases of fruit and vegetables, etc., out of th© sale, these being , subsequently shown on the following day’s auction sheets and in some cases up to ten days later than the actual sale. In the case under review they were shown as having been sold to country departments at Ils a case. In the course of witness’ investigation he ascertained that those particular bananas were sffid to five country clients at 15s Gd to His a case on July 29. The bananas were actually sold and dispatched to country clients before the entry was made in the auction sheet. On the 26 eases pi bananas sold Laery and . Co. made a profit of £5 6s. Sd. showing a net profit of 37 per cent. This had not been accounted for. Scott said to Mr. Johnston that probably the seven allegations had been made against the defendant company as a result of his report. Mr. Johnston: Did you interview a man in the Wi Tako prison in regard to Laery and Co.? Witness: Yes; I have to interview a number as I do th© accounts at the Wi Tako prison. Mr. Johnston: Did you interview a prisoner ? w Mr. Macassey objected that the question was irrelevant. The magistrate said he did not think the inquiries would carry them much further in the matter.

Mr. Johnston: It may be a light matter for a man in the audit department to have a firm which has been in business for 50 or 60 years, with a high reputation, attacked, but it is some advantage to know of the source from which the information has come, and if it is a disreputable source. ./■ Mr. Johnston: How did the depart ment come to make th© inquiries ? Witness: W© had reason to 'believe that we were not getting true and correct account sales from this particular firm. Mr. Johnston: Who bplieved? Witness: Oh, I can’t divulge that.. Counsel: I put it to you that you were the person to raise this suspicion. Will you deny it? , , Mr. Macassey objected and pleaded the protection of th© Act and said Mr. Johnston was trying to find out who had laid the complaint. The ■ magistrate (to witness): Your answer is that you de.cline to say who originated this inquiry. ■ i Witness: Yes. Th© cas© was adjourned until Wednesday to allow of another witness from Palmerston North being called,