. >f-<
Nr\
I ILLINOIS CANAL SCIUP FRAUD.
IE FORT OF EVIDENCE
. n
^jnvriitigatiou by \\\t 6vand ^(uvjj
(U" Q \\t: aathv roT'Vfy jyj^
TLnj! OF THE CiRCl'lT COUKT OP SAID CoiSTV, J'i.i';';
fvcb io br publishrb bn ;i lloft of !l)f 4^ninb |un]:)
5< >^
UNIVERSITY OF ILLINOIS
LIBRARY
Class
Book
Volume
38 U Sa583
Ja 09-20M _
THE GREAT CANAL SCRIP FRAUD.
MINUTES OF rPvOCEEDINGS,
AND
REPORT OF EVIDENCE
IN TUB
INVESTIGATION OF THE CASE,
»
BY THE GRAND JURY OF SANGAMON COUNTY, ILL., AT THE APRIL
TERM OF THE COURT OF SAID COUNTY, 1859.
Orbcrtb lo be p«bHshcb bn n JJote of the (!:r3ub|uriT.
> >♦«
DAILY JOURNAL STEAM PRESS,
SPRINGFIELD, ILL.
1859.
Sa5S3
INTRODUCTORY.
C-
V
y
U-
Tbe Circuit Court of Sangamon county commenced its session
at the Court House, in Springfield, on Monday, April 25th,
1859. The panel of the Grand Jury selected by the County
Court, was as follows :
WILLIAM BUTLER,
Council Sampson,
WiLLrA\: Vermillion,
Samuel H. Jemison^
William Crafton,
TuoMAS Kerlin,
Jesse Ruble,
Orlando Wadham
C. W. Vanderen,
B. A. Vanderen,
Andrew Rauch,
Armstead Sims,
William Patterson,
Jacob J. fVeber,
Harrison Baker,
John L. W^illson,
Joseph McDaniel,
James T. Robinson y
Abner Wheeland,
GeoRge Poaver,
AVILLIAM a. LOCKRIDGE, Samuel H. Jones,
John Caldwell.
Of the above, all except those whose names are printed in
italics, appeared and were qualified as Grand Jurors. The
names of those selected by the Court to fill the vacancies are
given in the body of the minutes herewith appended.
'.^
1.39378
MINUTES OF PllOCEEDINGS.
Grand Jury Room, April 27th, 1859.
The Prosecuting Attorney came before the Jury this morning
and asked their attention, which was granted. He then stated
that he had a communication to lay before the Jury, to which
he wished to call their attention, and, handing the Foreman a
letter, retired.
The letter was laid on the table, and the Jury continued the
investigation of matters then before them.
During the day the Foreman called the attention of the Jury,
and read the following letter and list of names thereto attached:
Springfield, Ajjril 27th, 1859.
To the Grand Jury of Sangamon County:
Gentlemen : — The undersigned feel called upon
to present to you for your consideration, a great fraud commit-
ted upon the people of this State, in the funding of what is known
as " Canal Checks'' once paid by the State; and request that
you will give the matter such attention as the magnitude of the
offence and the interests of the State demand.
Herewith you will find a list of witnesses, with their residen-
ces, whose testimony may aid you in your investigation.
Truly, Yours, &c.,
(Signed,) JESSE K. DUBOIS,
0. M. HATCH,
JAMES MILLER.
WITNESSES.
Enoch Moore, SprinrjfiehJ, Illinois,
W.M. F. TUORNTON, Slu'lhijvillc, "
Jacob Fry, Ottawa, "
John A. McClerxand, Springfield, Illinois.
Joel Manning, Lockport, *'
"William II. Brown, Chicago^ **
Ezra L. SiieriMan, " "
Michael Kehoe, " "
Josiah McRoberts, Jolief, "
Jesse K. Dubois, Springfield, "
John G. Nicolay, " "
Hart L. Stuart, Chicago. "
The Foreman then asked the Jury if it was their desire to go
into the investigation, stating that the witnesses were residing
in different portions of the State. He thought if they went
into the investigation, it would recjuire time to get the witness-
es ; he therefore wished to know the views of the Jury, and for
that purpose, he would put the question — All who were for pro-
ceeding with the investigation, would rise to their feet — all rose
up, except one Juror.
The Jury then instructed their Foreman to issue subpoenas,
or have it done, to the several counties, returnable on Wednes-
day, the 4th day of May next — except for the witnesses residing
in this county — that thoy set apart Tuesday next for the exam-
ination of witnesses in Sangamon county, so as to facilitate the
investigation as much as possible. The Jury also instructed
their Foreman to ask the Court to fill the panel from the panel
selected by the County Court — only eighteen being present. —
The vacancies were afterwards filled by the Court from the by-
standers, as follows :
Samuel Clark, John TV. Priest,
Washington E. Moore, A. D. McGraw,
Joel Ballard, James Maxcy.
Edward Perkins.
TESTIMONY.
3Iay itJiy 1859.
Enoch Moore sworn.
Question hy the Foreman of the Jury : — How long have you
been acting as Secretary in the office of Fund Commissioner in
this State?
Answer. I have been acting in that capacity sixteen or seven-
teen years.
Q. Are you acquainted with the different kinds of indebted-
ness of the State of Illinois ?
A. I am. I am somewhat acquainted with several kinds of in-
debtedness.
Q. Do you know anything about a certain kind of canal in-
debtedness known as ninety-day checks, that was issued by the
Canal Commissioners, dated in May and August, 1839 ?
A. I have seen such Canal Indebtedness.
Q. How many dated in May, and how many in August?
A. Of the issue of May, $95,900 — amount I have seen of
August 1st, was $10,900.
Q, Are those checks you have described made payable at
the Branch Bank of the State of Illinois at Chicago ? — and, if
80, to whom are they made payable ?
A. They are made payable to the order of the Treasurer of
the Illinois and Michigan Canal at the Branch State Bank at
Chicago.
Q, Are they indorsed by him — and if so, to whom ?
A. They are generally indorsed by his name being written
across the back.
Q.\ Is any portion of them indorsed to any other person — and
if so, to whom ?
A. In this bundle I find four indorsed, payable to the ordor
of William II. Brown, Nus. 271, 2U7, 703, and 96, of date May
1st, 1839.
Q. Do you know of any law authorizing the funding of this
kind of indebtedness — and if so, when did it pass?
Q. I think there was an act passed in the winter of 18-47, au-
thorizing the funding of State Scrip.
Q. "Was this kind funded under that law — and if so, what
amount ?
A. In October, 1854, there was $300 of this kind funded ;
and in July, 1856, ^200; and only in January, 1857, §13,300
was funded.
Q. "Whose name was this $13,300 funded in ?
A. $5,000 in John Kellogg's name ; §8,000 in Caleb John-
son's name, and §300 in name of William Smith.
Q. Did any portion of this amount funded as part of the
$13,300 include the Scrip you have described by numbers ?
A. They did not.
Q. Did you ever see any one of the persons in whose name
this Scrip was funded ?
A. I don't know that I did, except Mr. Smith.
Q. Who handed you this Scrip, or lots of Scrip, makinf up
this 313,300 ?
A. I don't remember, unless it was Gov. Matteson.
Q. Do you know the numbers of the bonds issued on this
Scrip ? — and if so, give us the numbers.
A. Numbers 886, 887, 888, 889, 890, 891, 892,893,804,
895, 896, 897, 898, and a part of the bond to William Smith—
899. The bonds were issued to bearer.
Q. Whom did you hand these bonds to ?
A. I don'i recollect.
Q. Have you ever seen those bonds since? — and, if so, where?
A. I have never seen any of them since I issued them. I sec
on the Auditor's Book Bond, No. 899 as being in the Bloom-
ington Bank, as deposited as security for its issue.
Q. Waathis or those amounts above specified, all of this kind
of Canal Indebtedness funded while you have been acting as
Secretary? — if not, how much, and when funded?
8
A. Ninety-three thousand and five hundred of that kind of
Canal Checks was funded in March, 1857, or in February and
March, 1857.
Q. By whom was it funded ?
A. It was funded in several different names, but for Gov.
Matteson, I suppose.
Q. To whom did you hand the bonds when issued ? — and
why did you think they belonged to Gov. Matteson ?
A. I don't remember who I banded them to, but from con-
versation between me and Gov. Matteson I understood the bonds
were for himself — from conversation that took place between
me and him.
Q. Can you give us the numbers of the bonds issued on this
$93,500 of Canal Checks?
A. They are from 900 to 992 inclusive, and one-half of 993.
1^. What amount of interest was on those Checks up to the
date of their being funded — that is, this last ^93,500.
A. $45,729.
Q. Did the Canal Checks indorsed to William H. Brown,
Cashier of the Branch Bank of the State of Illinois, as identi-
fied by you by numbers, constitute any portion of this last ?93,-
500 ? — and, if so, what bond did it go into ?
A. The Scrip or Checks identified by me, indorsed to Wil-
liam H. Brown, Cashier, does constitute a portion of the ^93,-
500 ; and Check No. 703 constitutes a part of Bond No. 931 ;
and Check Nos. 96 and 271 constitute a part of Bond 933 ; and
Check No. 207 constitutes a portion of Bond 934.
Q. What was done with the interest due on the Checks up to
the date of their being funded ?
A. Interest Certificates was issued for it up to July, 1847.
Q. Were they numbered ? — and, if so, give us their numbers.
A. They were numbered from 1,206 to 1,248, inclusive.
Q. In whose name were they issued ?
A. In the same name the bonds were issued in.
Q. Has any portion of them ever been funded ? — and^ if so,
in whose name were they funded 1
A. The most of them have been funded, and in the name of
9
the Auditor of Public Accounts, in trust for the State Bank of
Illinois.
Q. What amount has been so funded, and their respcctiro
numbers?
A. It I am correct, about ^84,884 has been funded. The
numbers of the certificates making uj) that amount are from 1206
to 1200, 1211 to 1237, inclusive, and Xos. 1239 and 1240.
Q. Tell us the numbers of the interest bonds that the Scrip
you have just described constitutes, and to whoin -were they is-
sued.
A. They constitute Interest Bonds numbered from 37 to 69,
inclusive, and most part of 30 and 70. They were issued to tho
Auditor of State in trust for the State Bank of Illinois.
Q. I see near ten thousand of the interest certificates yet un-
accounted for. Can you tell us what became of them ?
A. Nos. 1241 to 1248, amounting to $8,555, funded and in-
terest bonds issued for them. Nos. 162 to 169, inclusive, and
part of 170 to the Auditor of Public Accounts, in trust for State
Bank of Illinois.
Q. I see in the first part of your statement you mention $500
of this kind of indebtedness as being funded in October, 1854.
By whom was it funded ?
A. It was funded by N. II. Ridgley.
Q. Do you know whether this is now claimed as being coun-
terfeit ? — and, if so, has suit been commenced for its value or
for the amount it was issued for?
A. I understand it is said to be counterfeit, and that the
Auditor has commenced suit for it.
May m, 1859.
Testimony of Exocn Moore continued.
Question. Do you know of any other Scrip having been fun-
ded by Gov. Matteson ? — and, if so, state what kind and by
whom funded.
Anstver. Yes, there were other kinds than the Canal checks.
Q. Was there any funded of the denomination known as Ca-
10
nal 90 day checks, other than the $93,500 spoken of yesterday
in your testimony ?
A. Yes, there was.
Q. Do you know what kind of Checks was funded in the
$13,300 funded in January, 1857, spoken of in the preceding
part of your testimony ? — and, it" so, describe them and produce
the Checks if in your possession, and give us their numbers.
A. Here are the Checks — they are numbered — or those with-
out the Treasurer's name in the body of the Check — fi'om371 to
397, and from 399 to 406, inclusive, and fi^m 408 to 410, in-
clusive — they are all dated August 1st, 1839.
Q. What do they amount to ?
A. $4,400 — they are all one hundred dollar Checks.
Q. Can you give us the numbers of the Bonds issued upon
the funding of those Checks you have just described?
A. They are part in Bond No. 886, all of Bonds 887, 888,
889, and part of 890.
Q. State to whom were these Bonds issued, and f»r whose
benefit, if you know?
A. They were issued to John Kellogg, and I do not know
but they were for him.
Q. Who was it handed you the Scrip for funding?
A. I think it was Gov. Matteson. I think it was his place
to receive it, as he was ex-affieio Fund Commissioner at the
time.
Q. Has anything transpired since the funding of the Scrip
above alluded to, to give you any impression who these Bonds
actually belonged to at the time they were funded? and if so,
state what it is.
Mr. Meggs (a juror) objected to the above question being
answered by the witness.
The question being then referred to the Jury, it was decided
to be a proper question.
A. I don't know anything has transpired to give me any
ditterent impression than that I had at the time they were
funded, I have understood they were sent on to New York
to be sold for Gov. Matteson.
11
Q. By Mr. i^rcGraw. Who did you undcrstjind that from !
A. Mv. O. F. Lowe, of Now York, wrote to mo to that
eftect.
Q. Have you that letter ?
A. I linve. it at the State House.
(>, Will you ]iroduco it i
A. I will, if the Jury will f^ive me time. Here is the letter
marked " B."
(OOPY OF LETTER MARKED " B.")
New Yokk, March 10. 1859,
95 Wall Street.
Dkar Sin : — Tour favor of tho 4th came to hand, and I am surprised there was any
he»ita:ion in rc;j;nrd to funding tlio Canal Scrip under the law of 1S57. If tho Scrip
is gcuuino and the law has not been repealed, there is no course for the Governor to
pursue but to fund, as desired. If he declines to do so, you will oblige me bypupply-
iug Interest Stock for such porlio# of the arrears as he chooses to discriminate in
favor of. I trust he will determine to fund all, as I do not care to have a small parcel
that may be repudiated by-aud-by.
I have been fully advised as to tho Canal Scrip investigation, and although much
feeling has been excited here in regard thereto, I am truly pleased to inform you
that your position in the matter has not impaired tho ro peet heretofore felt for you
by all who have experienced your courtesy and attention. Tho extremely censorious
hint that there was collusion somewhere ; but no one, so far as I know, has been so
uncharitable as to connect your name improperly with the transaction. My business
and friendly relations with Gov. Matteson have suggested to tho unkindly-disposed
that I might have known of the fraud before it was revealed, or at the time of its
consummation, and perhaps profited thereby ; but this opinion is confined to that
class whoso mischievous propensity is greater than their powvr to fix defamation upon
character. Soon after the issue of the first Bonds for the 90 day Scrip, I sold for
Gov. Matteson eighteen Bonds, Nos. 882 to 899. A part of these (SS6 to 899) were
improperly issued, and are now held by some Banks in Illinois or Wisconsin. Can
you inform me what Banks own them now? You can ascertain in tho Auditor's
oflSce.
If tho Governor has approved tho law removing tho agency, Ac, I would bo obliged
for a copy, and also for instructions how to act as a Com'r. for Illinois. About tho
loth March, 1855, Mr. Osgood receipted for tho books, Ac, to W. A S. and J. Wads-
worth, and at the same time tho American Exchange Bank receipted to Gov. Matteson
and Mr. 0. Copies of all the receipts and statements were furnished the Governor.
I remain, very truly.
Your friend,
0. F. LOWE.
E.vocH Moore, Esq.,
Springjitldy HI.
12
Q. Is the foregoing a correct statement of your testimony
as concercing the thing therein stated ?
A. Substantially correct.
Q. Did Gov. Bissell examine this $93,500 funded since he
came into office, that was handed you by Gov. Matteson ?
A. I do not remember certainly whether I showed him any
part ol it before it was funded.
3fay Gtli, 1859.
Jacob Fky called, appeared in Grand Jury Room and
sworn.
Q. How long have you resided in Illinois ?
A. 1 have resided here, or in this State, forty years, I think.
Q. Have you been acting as C^liml Commissioner in this
State ? and it so, when did you commence and when did you
cease acting in that capacity ?
A. 1 commenced acting as Commissioner in March, 1837,
and ceased acting as Canal Commissioner when Trustees, or
Board of Trustees, of Illinois and Michigan Canal was organ-
ized, which took place in May, 1SI5, if I am not mistaken. I
was then appointed by Gov. Ford as State Trustee, and acted
in that capacity up to June, 1846 or '47.
Q. AVere the affairs of the Canal during the time you were
acting either as Trustee or Commissioner such as to require
you, acting in conjunction with others, to issue any kind of in-
debtedness to contractors or other persons to whom the Canal
was indebted ?
A. The affairs of the Canal were such as required the Board
of Canal Commissioners to issue both Scrip and Checks.
Q. Had you the power, or were you authorized by law, to
issue the kind of Checks that were issued May 1st and August
1st, 1839 ?
A. We had — they were issued by authority of law.
Q. Can you state the amount issued in May 1st, 1839 ?
A, Of the regular Checks of the May issue, ^219,324 ; and
18
of what •VTG termed tlie irregular Checks, $'40,735 — making a
total of $2(5'J,OoU. The irregular Checks were Checks issued
to a contractor on the Canal f<»r the amount due him, or in
such Bums as he called tor. W a balance was due him over and
above the sjiecitic amount he had called for in one check, we
l)aid him what we called regular checks for the balance. The
regular Checks, both of the May antl August issue, were issued
in sun)s from $1 to $2, $o, •'rilO, ^50 and $100. The May
issue was all made payable to the order of J(»lm A. McCler-
nand, Treasurer, and the August issue to John Calhoun,
Treasurer. The August issue was all $100's— of those denomina-
ted the regular Checks. All the Checks of the May and August,
1830, issue, were made payable ninety days from date, at the
Branch Bank of Illinois, at Chicago, Three thousand eight
hundred and twenty-two dollars of the regular May issue was
registered and charged to the Treasurer, liut never put in cir-
culatit)n.
Q. Here are some Checks, purporting to be of the l^Fay
issne, Nos. 703, 271, d6, 207, — are they a portion of the May
issue you have been describing ?
-.1, They are.
Q. Have you any of the Checks of the August issue you
have been describing? — if so, show them to the Jury,
A. 1 have, here. TJacy are three in number; being Nos.
125, 922, 0-40. They are genuine, I think.
Q How many of the August issue have you now in your
hand of the denomination of $100?
A. Forty-four — all hundreds.
Q. Did the Board ever issue them ?
A. They never did — they never put them in circulation.
Q. Please give me the numbers.
A. They are Nos. 371, 372, 373, 374, 375, 37(5, 377, 378,
379, 3S0, 381, 382, 383, 384, 386, 386, 387, 388, 380, 390, 301,
302, 303, 304, 395, 306, 397, 399, 400, 401, 402, 403, 404, 405,
406, 408, 400, 410, 411, 412, 413, 414, 415, 416.
Q. Do you recognize this, or those Canal or Bank Checks,
1^
as yon term tliem, as the same you have been describing, as
of the May or Angust issue of 1839 ?
A. I do.
Q. Have they ever been paid, of your own knowledge ?
A. They were paid by tlie Bank. YV e had the money there
for that purpose — they took them up and charged us with the
amount. Gen. Thornton took up about one hundred thousand
dollars of the May and August issue, as I now recollect.
Q. Has all of the May and August issue been paid and taken
up ? If not, what amount remains outstanding ?
A. When I was superseded, in 1847, they were all paid and
taken up except §315 of the May issue ; and I reported the
fact to the Governor and he laid it before the Legislature, as I
see it has been published.
Q. Did you ever caution the State officers against receiving
any of this kind of State or Canal indebtedness, saying it had
all been taken up, except $315 ?— and if so, when did you warn
them ?
A. During the session of our last Legislature, Mr. Campbell,
of La Salle, showed me a $100 Cheek of the May issue, and asked
me if I knew about this. I told him I knew it was a counter-
feit—that there were no $100 Checks in circulation — they have
all been paid and taken up many years ago. I then wrote to
Mr. Manning, calling his attention to it, and told him my re-
collection of the matter was that it was all paid, and asked him
if I was correct — he answered me, I was correct. I then went
and told Col. Dubois about it, and put them on their guard
about it. Mr. Dubois then called for Mr. Moore, and asked
him if any of this kind of stuff had been funded. Mr. Moore
remarked that a good deal had been funded. This was the
first I ever heard of the fraud.
Q. "Was Joel A. Matteson a contractor on the Canal at any
time while you were acting as one of the Commissioners ?
A. He was.
Q. Did you, or any one of the Board, ever pay him for work
done on the Canal with Scrip or Checks of the May or August
issue ?
16
A. I can't Eay whether any of the Checks above spoken of
were e\'er paid to Joel A. Matteson, but my impression now
is that there was some of the kind paid to him.
Q. Tell the Jury what you know — if anything — about the
00 day checks of the regular issue of date May Ist and August
1st, 1830, of all denominations, after they were paid olf and
returned to the Canal Ollice.
^1. "We got a box made and put all the Checks in it that
were redeemed up to that time — the 90 day Checks of May
and August issue. The denominations that were issued were
$1, $-2, $5, $10, $50 and $100. I speak of the regular Checks.
There may have been irregular Checks in the box — my im-
pression is, there were — they were tied up in bundles with an
envelop around them, and the amount of each package marked
on the envelop. A schedule of the amount of each bundle
•was made, one copy of which was packed up with the Checks
in the box — another copy was kept by the Canal Board. The
box was nailed and wrapped with red tape — an auger hole
bored in the edge of the box where the lid and side join to-
gether — the hole filled with red sealing wax, and the impres-
sion of the official seal of the Board placed upon it. The box
was then taken to Chicago by Mr, Manning, the Secretary of
the Board, and deposited in the vault of the Branch of the
State Bank at Chicago — remained there during my continuance
in office as State Trustee, which^ if my recollection serves me,
was in May or June, 1817.
Q. About what time was this box packed ?
A. My recollection is, it was packed in December, 1840.
Q. Have you any further knowledge about it? — if so, state
all you know.
A. When I was superseded by Col. Oakley, I took his re-
ceipt for it — I have no further knowledge of it.
Q. Have you any knowledge of any other box being in the
Bank, and cuntaining property, or anything else belonging to
the Canal Board t — and if so, please tell the Jury all you know
about it.
^1. There was a small box, about the size of a candle bo;(
16
packed by Col. Manning, some time in 1812, containing Canal
Sight Checks and others of various denominations. There
might have been some Scrip in it. A schedule was made of
the number of packages and the amount of each package, and
a copy left with the Board of Canal Commissioners, and the
box turned over to Col. Oakley, and his receipt taken. The
aggregate amount of Checks and Scrip in the box was a little
over $25,000.
Q. By W. E. Moore. Do you positively know that the
packages put in the first named box contained the amount
marked on their respective envelops ?
A. I would not undertake to say positively that they did — -
I did not count them — but I have no doubt, in my own mind,
but that they did contain the amounts so marked on the en-
velops.
May 7th, 1859.
Mr. Joel Manning sworn.
Q. Have you been acting as Secretary to the Board of
Commissioners of Illinois and Michigan Canal, and if so,
how long ?
A. I acted as Secretary of the Board from the time of its
organization till it went out of the hands of the State into the
hands of the Trustees — from the winter of 1836 to the summer
of 1845.
Q. Do you know anything about a certain class of Canal
indebtedness, issued by the Board, denominated 90 day
Checks — issued first of May, 1839, and first of August,
1839?
A. Those issued first of Maj,1839, we denominated on our
books as 90 day Checks, No. 1 ; and those of August, 90 day
Checks, No. 2.
Q. Tell the Jury what amount of 90 day Checks, No. 1,
was issued or put into circulation, of the May issue.
A. What we call the regular Checks are of the denomiua-
17
tions of $1, $2, $5, $10, $50 and $100. The irregular Checks
are those issued to contractors in such amounts as they re-
quested.
Q. What amount of the re<j:uhir Checks of tlic May issue
was issued, and what amount was put into circuhition ?
A. Of this description of Checks there were $219,324 made,
put into the hands of the Secretary, and charfjed on the books
to the Secretary and entered upon the register ; but as they
were not all needed, only $215,502 were put in circulation.
Three thousand eight hundred and twenty-two dollars re-
mained in the hands of the Secretary, in sheets, and not
cut up.
Q. "What amount of the August issue of the regular Checks
was issued and j)ut into circulation ?
A. There was $30,000 in Checks of $100 each, fully execu-
ted, charged to the Secretary, and put into circulation, and I
believe there were as many as three packages containing one
hundred Checks each, of the same denomination, which was
partially executed — some more, some less complete — which
were never charged on our books or put into circulation, and
considered and treated by us as blank Checks.
Q. Were all of these Checks made ])ayable at the Branch
Bank of the State of Illinois at Chicago ?
A. I think they were all made payable at the Bank of Illi-
nois at Chicago, to the order of the Treasurer — those of the
May issue to the order of John A, McClernand, and those of
the August issue to John Calhoun.
Q. IIow many of the Checks you have been describing, of
the May and August issue of 1839, have been paid ?
A. All but §315.
Q. What was done with them after they were paid and
taken up ?
A. Upon the return of the Checks to the office, they were
carefully counted, entered on the register as returned, and the
anujunt entered on the books of the office, the Checks them-
selves deposited in the safe, with the amounts noted on the
3—
18
wrappers of the several packages. This was done each time,
as these Checks were returned. They remained in the safe
until December, 184:0, when a box having been prepared for
the purpose, they were tak.^n from the safe and carefully re-
examined by Gen. Fry, myself and Mr. McFarlane, my clerk,
and lists taken specifying the amounts in the packages, and
then these packages containing all these Checks, at the time
or up to that time returned to the office, were put into the
boXjtogether with other Checks, so returned, and withdrawn
from circulation, with a copy of the said list put into the
box, also one into the safe. The box was then closed and
sealed up, and taken by me to Chicago and delivered to the
Branch Bank there, to-be put into their vault for safe keeping.
At the time of packing up the Checks, as above stated, there
were seven hundred and twenty-two dollars of them still not
returned, part of which were subsequently returned, so as to
reduce this amount to three hundred and fifteen dollars, as I
have before stated.
Q. Please state to the Jury whether you had that box
made —if so, describe it as minutely as possible, and how it
was sealed.
A. I had the box made for the express purpose of packing
the Checks in it. It was of pine boards, at least an inch
thick, something like two feet square, a little less than that in
height. The box was sealed by countersinking and filling
with sealing wax, either over the screws or nails which fast-
ened on the lid and bottom, or across the seams between the
lid and bottom, so that they could not be taken ofi" without
breaking the wax, and upon this, while soft, was impressed the
public seal of the Canal office.
Q. Did this box you have been describing contain the May
and August issue of what you term the regular 90 day
Checks ? — and if so, are any part of this bundle the same
Checks you put into that box ?
A. I put into the said box all of the said Checks which had
been returned to the office up to that time, and most of the
19
Checks now befoi-c me, brou.fjlit; in by the Auditor, are the
same that were packed in tlie box.
Q. Was any portion of these packed in the box canceled at
the time they were packed ?
A. We i)acked the Checks as we received them from the
Bank— those of the denominations of ^50's and ^lOO's were
not cut with a cancelin<^ hammer— a part of the smaller de-
nominations might have been— I do not now recollect. In
the condition, in this respect, as we received them, so we put
them into the box, and 1 tind, among the Checks now on the
table before me, none of any denominations except fifties and
hundreds of the said issues of May and August.
Q. You spoke of Checks of the August issue, as being par-
tially tilled and put in three or more bundles, often thousand
dollars each — ])lease tell the Jury what became of them, it
you know — and were they canceled when you last saw them ?
A. When we packed the box of which I have been speak-
ing, we intended to put in all the Checks of the said two
issues, then in the office, and we did put in those which had
been circulated and returned, the sheets of the May issue
which were executed but never circulated, and also all the
unfinished Checks of the August issue — and at the same time
we i)ut them into the box they were not cut with a canceling
hammer nor in any other way defaced.
Q. Was the Scrip of the August issue which you now
have in your possession, numbering in consecutive Nos. from
371 to 397, 399 to 40G, and 408 to 416, put into the box you
have been describing ?
A. The Checks before me for examination, of the numbers
above mentioned, were of the unlinisiied Checks of the August
issue, mentioned in mv former answer. I do not recollect at
the time, of noticing these particular numbers, but as we did
number quite a quantity of them, of these unfinished Checks,
sutiicient to e.xtend to and beyond, I think, those numbers, and
as we put all these incomplete Checks into the box, I am quite
certain these wore put into the box with the others.
20
Q. Were those ever put into circulation by any person or
persons since they were put into the box ; or, in other words,
have you ever seen any of this kind of unfinished Checks in
circulation ?
A. I have never seen any of the Checks mentioned in my
last answer in circulation, and I would not think they could"
be circulated in the unfinished and incomplete condition in
w^hich they are.
Q. Please tell the Jury the mode adopted by the Board of
numbering those Checks of the May and August issue you
have been speaking of— the denominations of $50 and $100 ?
A. When we numbered the May issue of fifty and hundred
dollar Checks, we began, "A. No. 1," "A. No. 2," and so on
through the whole, ending with No. 866 ; and when we began
numbering the August issue, which were all hundreds, we
began where we left off in May, the first number being "A.
No. 867, 868," and so on regularly up to No. 1,000, and then
began " B. No. 1," " B. No. 2," in regular order, through all.
We numbered both finished and unfinished Checks of that
issue.
Q. Do you know anything about any other box that con-
tained any portion of the small issue of Checks of either the
May or August issue? If so, please tell us all you know
about it, and if it contained canceled Checks or uncanceled
Checks ?
A. In the spring of 1841 Gen. Fry requested me to go to
Chicago and receive, on the part of the Board, the small at
sight Checks issued by the Board upon the Bank, of the de-
nomiuation of $1? $2 50 and $5, count the same, pack them
in a box and deposit the box in the Bank vault. I did so,
carefully counting these Checks, put up in a number of pack-
ages, and the several amounts marked thereon. These pack-
ages, when the counting was completed, were put into a small
box. A list of these packages, with their amounts, was taken
by Mr. Howe, Clerk in the Bank, one copy, I think, put into
the box and one I received, and which I now have, and the
21
date of the filin£C of it is April 28, 1S42. This is what we call
box No. 2, l)ut lias by some been called the candle box, and
wjUs a tox of about the size and description of aconnnon candlo
box. This box, after being thus packed, was fastened and
sealed u\) and left with the I'ank. After these Checks were thus
counted they were all cut with a canceling hammer — I believe
by Mr. Howe; if not by him, by Mr. Brown, the Cashier.
Q. Do you know of any other fact going to throw light or
information on the fraud that has been committed upon the
State, which has not been brought before the Jury by questions
that have been propounded to you ?
A. I do not now recollect anything of the kind.
Jfaij St/i, 1859.
William II. BroWn sworn.
Q. Have you ever acted in the capacity of Cashier of the
Chicago Branch of the State Bank of Illinois ? If so, when
and how long i
A. I was appointed Cashier in 1835, and opened the Branch
in Chicago in the fall of that year, and continued in the Bank
until it was finally closed about the year 1845 or 184G.
Q. Was the Bank the fiscal or paying agent of the Board
of ('anal Commissioners? — and if so, please examine the Canal
Scrip, or as they are mofe frequently termed. Bank Checks of
the May and August issue, and state, if you can, whether they
M'ere })aid by the Bank.
A. The Chicago Branch was the fiscal and paying agent of
the Canal Commissioners, and their funds were, from time to
time, deposited in that ]^)ank and paid upon the Checks drawn
by the Treasurer of the Board in the usual course of business,
like the Checks of other depositors. I have examined the
Checks of the May and August issues, now lying before mo
on the table, and I cannot say which of the individual Checks
were paid by the liank. The whole issue of the May Checks
was between $300,000 and $400,000. Of this amount, it ap-
22
pears by the books of tlie Bank, which I Lately examined, that
$170,000, or thcreabonts, were paid by the Bank on or before
the 16th of September, 1839, and returned to the Canal Com-
missioners, and the Treasurers Check taken therefor and
charged to his account.
Q. Examine those Checks of the May issue, Nos. 207, 96,
271, 703, and answer whether those identical Checks were or
were not paid by the Bank ? Please state to the Jury, on ex-
amining the bundles or pile on the table, whether you identify
any others as having been certainly paid by the Bank.
A. I have examined the four Checks numbered 207, 96,
271 and 703, all of which are specially indorsed to me by the
previous indorsers. These Checks must have been paid by
the Bank, though I cannot positively say they were, and
speak now from my knowledge ot Banking business. By the
indorsements, specially, Nos. 96 and 371, I have no hesitation
in saying, must have been received by me, through the mail,
from J. A. Welles, Esq., then Cashier of the Farmers' and
Mechanics' Bank of Detroit, whose signature, from my per-
sonal acquaintance with him, and from a numerous correspon-
dence, I am as familiar with almost as my own, and whose
signature upon the Checks I fully recognize. I identify many
other Checks, among the bundles of Checks upon the table,
as having passed through the Bank, by being especially in-
dorsed to me, as Cashier, from other Banking Institutions in
Ohio, Indiana, and from the Alton Branch of the State Bank.
Q. Did yon ever put in circulation any one of those Checks
you especially identified by numbers, or any part of those re-
ceived and paid by the Bank ? If not, please tell the Jury
what disposition was made of them by the Bank.
A. I never put into circulation any of the Checks I have
identified as above, or any other of the Checks issued on Mayor
Auo-ust 1st, 1839. These Checks were counted as cash in our
daily cash settlements, and sufi'ered to accumulate until the
Canal Treasurer, Col. McClernand, called for them, when
they were delivered to him, and he gave his Check, as Treas-
23
urer, for tlie'amount of the Checks handed over to him. The
Checks I identify were phaeed in the vault with those paid at
the counter, while the accounts of Banks sendinf^ them were
duly credited. For some reason, which I cannot recollect,
the May and August Checks were not canceled, as they should
have been, in the regular course of business, but, as I said
before, were counted as cash until delivered to the Treasurer.
Q. Did Mr. Manning ever deposit any box with the ]3ank
for which he took their receipt? If so, when and how long
did it remain there? State to the Jury if you have any recol-
lection of any box being at the Bank, for safe keeping, belong-
ing to the Canal Office. If so, how long did it remain in
possession of the Bank, by what name was it known and what
did it contain ?
A. I think in December, 1841, Mr. Manning deposited in
the Bank, for safe keeping, a heavy square box, containing
Canal papers — of what kind I never knew. Mr. Howe, my
Clerk, gave him a receipt for it. Mr. Manning also deposited
a box, which looked like a candle box, and I think a paper
parcel. I do not know what papers were in the candle box
or paper parcel. The square box and candle box and paper
parcel were safely kept in the vault of the Bank until, I think
the year 1849. I then called upon the Canal Trustee, or
some one in his office, and requested their removal. A per-
son was sent from the Canal Office, and the square box, can-
dle box and bundle were delivered to him. The boxes, while
in my possession, were never opened by me, or, as I believe
by Mr. Howe, my clerk. For the last five years I had exclu-
sive possession of the keys of the vault, and it was not opened
by any one but myself.
Q. Please examine this bundle of imfinished Checks, as
they are termed, of the August issue, forty- four in number, of
the denomination of $100 each, and say whether you think a
man of ordinary business capacity would receive them in their
present condition, or attenqit to pay them out ? If not, please
tell the Jury your reason for coming to that conclusion.
24
A. I have examined the fortj-four Checks of the August
issue handed me by the Foreman of the Grand Jury, and
answer that I do not think a man of ordinary business capacity
would receive or pay out these checks. The reason I give is,
tliat they have every appearance of an unfinished Clieck, made
to be issued \vhen occasion required. The name of the payee
is inserted in the blank, and the edges of the Checks uncut.
If any or all of these Checks had been presented for payment
at the Bank, I should have declined to receive them — though
the Treasurer's account might be good — until I had made in-
quiries of the proper officers.
Q. Are you acquainted with Joel A. Matteson ? If so,
please tell the Jury whether you look upon him as a man of
ordinary business capacity.
A. I have been acquainted with Joel A. Matteson for a
number of years, and have always supposed him to be a man of
ordinary capacity — at least for the transaction of business.
Q. Are you in possession of any further information relative
to the investigation of the case of fraud under consideration
of this Jury that the questions put have not brought out? If
80, please tell the Jury what it is.
A. I do not recollect of any facts pertinent to the investiga-
tion I have not stated.
Michael Kehoe sworn.
Q. Have you ever acted as porter for the Canal Office ?
A. Yes.
Q. How long did you act in that capacity?
A. It was from November, 18-17, to April, 1853.
Q. Do you know anything of two boxes that were once
kept at the Branch State Bank of Illinois, at Chicago, and
belonged to the Canal Office?
A. Yes, sir, I do ; and two packages, also, wrapped in
brown paper.
Q. Tell the Jury all you know about those two boxes and
packages.
25
A. Some time in the year of 184S Col. Oakley gave rae an
order and sent me down to the old State Bank, on the corner
of South Water street and La Salle, for the boxes and two
packages. AV". J I. Brown gave them to me, and I put them
on a dray and brought them to the State Trustee's Office, on
the corner of "Wells and Lake streets, and gave them to Col.
Oakley. I think the packages were put in the safe and the
boxes put by the side of the safe. They remained in the
office up to April, 1853. Mr. McRoberts was appointed
State Trustee at that time. Mr. McRoberts and niyselt packed
what was in the two boxes and the two packages, also what
was in the safe, into one trunk and a box. They were directed
to "Gov. Matteson, Springfield, Illinois." I took them to the
Rock Island R. R. Depot, by the directions of Mr. McRob-
erts, and gave them to him. They were put in the baggage
car. That was the last seen of them.
Q. By Mr. Lockridge. Please state what condition those
two boxes you have described were in when you and Mr. Mc-
Roberts went to send them off.
A. The candle box was something slmck (shaken or broken)
in one corner with standing on it at the Canal Sales, the office
was so thronged with people. Thomas Bradford looked at
the corner of it to see what was in it one time. I believe he
said it was Canceled Scrip.
Q. Have you ever seen the box or trunk since you put them
in the car ? If so, where ?
A. I seen the trunk last February, in the State House,
JosiAH McRoBEETS swom.
Q. State when you became connected with the Canal Office
as State Trustee — who was your predecessor — what did you
receive from him at the time you took possession of the office
— what did vou do with the contents of the office, includins:
boxes, books and papers ?
A. I was api)ointed State Trustee in February, 1853 ; took
possession of the Canal Office about the first of A})ril. Josei)h
B. Wells was my predecessor. I received from him all the
26
books, papers, vouchers and the general contents of the office.
He delivered to me two small boxes. One of them was open
at the time. I went from Joliet, my place of residence, to
Chicago, where the office was then kept, on Friday, I think.
On Saturday Gov. Wells delivered the office and its contents
into my possession. I examined the box that was open,
and found that it contained canceled ninety day Bank
Checks. I examined several of the packages in the box, and
found they did not hold the amount marked on the wrappers.
Some of the wrappers were entirely gone, and, from the
appearance of the box, some of the packages had been taken
out. While examining this box Gov. Wells came in, and I
called his attention to the fact that the packages did not hold
out; to which he replied in about this language : "JSTo; and
there is nothing about the office that will come within gun-
shot of what it purports to count."
Before receiving the office from Gov. Wells he stated to me
what was in the office ; said there were some boxes and pack-
ages of Scrip, that should be sent to Springfield and deposited
in the State Department, and advised me to send it down to
Gov. Matteson. I saw Gov. Matteson, a few days after, and
stated to him what Gov. Wells had advised in regard to a
disposal of the Scrip. lie said "very well, send it down,"
and he would deposit it in the State Department.
I then returned to Chicago, (on Friday, I think,) and on
Saturday received the office and its contents from Gov. Wells.
I directed Michael Kehoe, who was the porter in the office, to
meet me at the office on Sunday morning, and we would pack
up what was to be sent to Springfield. Kehoe came, on Sun-
day morning, and we took a large, black trunk which was in
the office and packed in a part of the packages. We saw the
trunk would not hold all that was to be sent. Kehoe procured
a shoe box, as I now remember, and we packed the packages
and the contents of the box that had been broken open in the
trunk and shoe box — a part in each or the whole in one or the
other. I also received a sealed box from Gov. Wells, which
had the impression of the seal of the old Board of Commis-
27
eioners upon it. Kelioe and myself tried to put the sealed
box first in the trunk. It would not go in. We then tried
to put it ill the shoe box, but found that the lid would not go
upon it. We took it out, and I think Kehoo opened it with a
small axe. We found it contained packages done up between
two pieces of paste-board cut the size of the box. The pack-
ages were laid in between the pieces of paste-board. The
paste-boards were then wrapped with tape or twiue, and, I
think, sealed with sealing wax. We cut the tape, took out
the packages and put a i)art in the trunk and a part in the
shoe box, or the whole in one or the other, but cannot state
which. Kehoe and I did not examine the contents of this
sealed box. I did not know what the contents were. There
were certain packages of Scrip in the safe, which we also took
out and packed in the box and trunk, a part in each or the
whole in one or the other. We put everything contained in
the two small boxes, the contents of the several packages, and
all the Scrip in the safe into the trunk and the shoe box. We
then nailed the shoe box and locked the trunk, and, I think,
sealed them with wax, but cannot state certainly. Kehoe
went out and procured a marking pot and brush, and I marked
on the box "J. A. Matteson, Springfield, Illinois," and put a
card on the end of the trunk with a similar direction. I then
directed Kehoe to meet me at the Depot of the Kock Island
Railroad on Monday morning. I found Kehoe there with the
trunk and box. I put them into the baggage car and went
with them to Joliet, where I met Gov. Matteson, and informed
him that I had a box and trunk which were to be sent to the
State Department. I went with him to La Salle, took the
box and trunk along and there delivered them to Gov. Matte-
son. He had them put into the baggage cart to take them
across the Illinois River to the Central Depot. This ended
my connection with the box and trunk, and is, I believe, all I
know in regard to them.
28
May 9ih, 1859.
Jesse K. Dubois sworn.
Q. Are you Auditor of the State of Illinois ?
A. I am.
Q. Are you, or is it made your duty by law, to hold for the
protection of the issues of the several Banks in the State, the
Bonds that the law rc(|uires shall be deposited for that pur-
pose!
A. The control of all the Bonds deposited for circulating
notes are placed under my control and direction — they are de-
posited by law in the Treasurer's office, for safe keeping.
Q. Are you in possession of Bonds No. 886, 887, 888, 889,
890, 891, 892, 893, 894, 895, 896, 897, 898 and 899 ?
A. The Auditor's office is not in the possession of the above
Bonds, nor were they ever in the office to the credit of any of
the various Banks, to my knowledge. It is possible they may
be — if so, I have not been able to find them.
Q. Have you any instrument of writing now in your posses-
sion, that proves, to your mind, that those Bonds, above allud-
ed to by numbers, constitute any part of the late fraud that is
said to have been committed on the State ?
A. I have a Mortgage, given by Joel A. Matteson and
wife, made pursuant to an Act of the Legislature, acknowledg-
ing the Bonds 886 tt 899, inclusive, to be a part of the fraudu-
lent Scrip funded.
Q. Have you in your possession that Mortgage, alluded to
in your last answer? — and if so, please show it to the Jury
and attach it to the answer.
A. I have — and an authenticated copy is hereunto attached:
COPY.
This indenture, made and entered into this 21st day of April, A. D. 1859, between
Joel A. Matteson and Mary Matteson, his wife, of the County of Sangamon and State
of Illinois, of the first part, and the People of the State of Illinois, of the second
part,
Witnesseth: that the said party of the first part, for and in consideration of the
passage by the People of the State of Illinois represented in the General Assembly,
of an Act entitled "An Act to indemnify the State of Illinois, against loss by reaaon
29
of unlawful funding of Canal Indebtedness," and for nnd in conRidcrntion of
tlie privili'fft's and adviintni;os and extension of tinn' secured to snid Joel A.
Matlesoa by said act, and for tlio further consideration of the sum of one dollar
to the party of the first part in hand paid, have pivcn, grunted, biirj^'uined
and sold and by these presents grant bargain and sell to the said party of
the second part, certain tracta or parcels of lands lying and being in the City of
(Juincy, in the Coiiiity of Adams, in the Slate of Illinois, designated, known and de-
Bcribed as follows, towit : Lot eight (N) in block sixteen (ItJ) in the original town
(now city) of tiuiiiey : Lots four and sixtten Neviu's Addition to the City of Quincy ;
and the cast half of Ulock lifty-six in John Wood's Addition to the town (now citv) of
t^uincy, to have and to hold the said tracts or parcels of land to the said [)artv of the
second pari forever. And the said Joel A. Matteson, for himself, his heirs and
assigns, executors and administrators, covenants and agrees that he is lawfully seized
of an indefeasible estate in fee simple in and to said tracts of lands aforesaid ; that
the same are free from all incumbrances; that he will forever warrant and defend
the same to the party of the second part and their assigns against the claims of all
persons whatsoever; and that until the conditions of this Mortgage are fully per-
formed he will pay promptly all taxes assessed on said lands, and will keep all the
improvements on said lands fully insured in some solvent Insurance Office, and will
assign to the party of the second part, as additional security, the policies of Insurance
on said improvements us soon as taken.
Yet this deed is made on the following conditions : That if the said Joel A. Matteson
shall indemnify and save harmless the State of Illinois from all liability on account
of the Uonds of said State, numbered from Nine Hundred to Nine llundred and
Ninty-two, inclusive, and one half of Nine IJundred and Ninety-three, of Illinois and
Michigan Canal Honds, and now deposited with the Auditor as security for tlie re-
demption of the bills or notes and payment of other liabilities of the State I5ank of
Illinois at Shawueetown ; and also on account of Bonds of said State numbered 886 to
898, inclusive, and three hundred dollars in Bond number S99, the same being Bonds
designated as Illinois and Michigan Canal Bonds, and now outstanding, and for all
moneys that may be paid by the State thereon, and from all liability upon any certi-
ficates, interest bonds or other evidences of indebtedness that may have been issued
on account of any of the Bonds aforesaid or the Canal Scrip for which said Bonds
were issued, and on any Coupons now or hereafter attached to said Bonds or any of
them, and from all costs, expenses and damages that may accrue against said State
by reason of the said Bonds, Certificates, Interest Bonds, Coupons or other evidences
of Indebtedness ; and shall also repay to the State of Illinois, within five years from
the nineteenth day of February, 18')9, any money that has been heretofore paid by
the said State of Illinois, on account of said Bonds, Certificates, Interest Bonds,
Coupons or other evidences of Indebtedness, or for Interest on the Canal Checks or
Scrip, upon which .said Bonds were issued, or in the purchase by the State of any of
said Bonds, Certificates, Interest Bonds, Coupons or other evidences of Indebtedness
arising out of the funding of said Canal Checks or Scrip, upon which said Bonds were
issued, together with six per cent, per annum interest on each and every sum of
money paid by the State upon such Bonds, Certificates, Interest Bonds, Coupons or
other evidences of Indebtedness, or for said interest, or in the purchase of any of the
said Bonds, Certificates, Interest Bonds, or other evidences of Indebtedness, to be
computed Ironi the time when any such sums of money shall have been paid : And
if, at any time, the Governor, Audito. and Treasurer of the State of Illinois shall be-
lieve that the security given by said Joel A. Matteson has depreciated and that the
some ha& become inadequate, they may require the said Joel A. Muttesod to give ad-
30
ditional security, and in case said Joel A, Matteson shall not give such additional
security, within sixty days afte" a notice in writing shall have been given him by said
Governor, Auditor and Treasurer so to do, then the sum of money secured to the
State as aforesaid shall immediately become and be deemed due and payable from the
time of such default. Now, if the said Joel A. Matteson shall well and truly keep
and perform all the aforesaid conditions, then this deed of Mortgage to be void; else
to remain in full force and virtue.
In testimony whereof, the said party of the first part have hereunto Bet their hand!
and seals, the day and year first above written.
JOEL A. MATTESOX, [seal]
MARY MATTESON. [seal]
State of Tllixois, )
Sunyamon Coiinti/, VsSi
City of Springfield. )
Before me, the undersignrd, a Notary Public in and for said city, personally ap-
peared Joel A. Matteson and Mary Matteson, his wife, wlio are personally known to
me to be the real persons by whom and In whose names the above conveyance was
executed, and by whom and in whose names the same is proposed to be acknowl-
edged, and who acknowledged their signatures thereto to be their free and voluntary
act and deed, for the uses and purposes therein expressed. And the said Mary Mat-
teson, wife of the said Joel A. Matteson, having been by me made acquainted with
the contents of said conveyance, and by me examined separate and apart from
her Slid husband, acknowledged that she executed the same, and forever relinquished
her right to the claim of dower in and to the lands and tenements therein mentioned,
freely, voluntarily and without compulsion or coercion of her said husband.
In testimony whereof I have hereunto set my hand and seal this
[seal] 23d day of April, A. D. 1859i
JOHN W. BUNN,
Notary Puhlie^
Nok 3145.
State of Illinois, )
Adams County.
Received for record and recorded, April 27th, A. D. 1859, in Book N, of Mortgages,
On pages 550, 551 and 552.
Attest, THOS. W. McFALL,
Recorder.
By E. B. BARKER,
i)eputy.
Auditor's Office, Illinois,
Springfield, May 6th, 1859.
I, Jesse K, Dubois, Auditor of Public Accounts of the State of Illinois, hereby
certify that the foregoing is a correct copy of the original Mortgage, from Joel A,
Matteson and wife, to the People of the State of Illinois, now in my possession as
Auditor.
In testimony whereof, I have hereunto set my hand and official
[seal] seal, the day ond year above written.
JESSE K. DUBOIS,
Auditor,
31
The above deed is indorsed as follows;
Adams County.
Murtgnije Deed.
Joel A. Matteson oud Wife,
TO
The People of the State of illinoia.
Q. Have you or had you at any time since the fraud was
connnitted any other mort^a^i^es, of which the one you have at-
tached is a true copy, except the one you have shown to tho
Jury I — and if so, please state where they are.
A. On the 25th of April last, I sent, by express, mortgages
simiUir to the one hereunto attached, varying 'only in the de-
scription of property, to the several Recorders of Cook, Will,
La Salle, Bureau, Peoria and Vermilion counties, and city of
Cairo, and delivered, in person, one to the Recorder of San-
gamon county, all of which mortgages have not, as yet, been
returned to my office by said Recorders.
Q. Have you any other mortgage in your possession, given
to secure the State against the said fraud, other than the ones
you have last spoken of? — if so, please attach it or a certified
copy to your answer as a part thereof.
A. I have a mortgage or indemnifying bond, executed by
J. A. Matteson, Roswell E. Goodell, John McGinness, jr.,
and Charles S. Matteson, and an authenticated copy is here-
unto annexed :
COPY.
In purBuanco of the prorisions of an act passed by the People of tho State of Illi-
nois represented in the General Assembly, entitled " An act to indemnify the State of
Illinois against loss by reason of unlawful funding of Canal Indebtedness," approved
February 19, 1S59, and for tho purpose of securing to tho undersigned, Joel A. Mat-
teson, tho benefit of the provisions of said act and the extension of time therein
granted, We, Joel A. Matteson, principal, and Roswell E. Goodell, John McGinness,
jr., and Charles S. Matteson, securities, jointly and several'y agree and bind ourselves
to indemnify and save harmless tho People of tho State of Illinois from all liability
on account of Bonds of tho .State, numbered from nine hundred to nine hundred and
ninety-two, inclusive, and one-half of nine hundred and ninety-three of Illinois and
Michigan Canal Bonds, now deposited with tliu Auditor as security of the bills or
notes and payment of other liabilities of tho State Bank of Illinois at Shawnoetown ;
and also on Bonds of laid State, numbered SS6 to 8U8, inclusive, and three hundred
32
dollars in Bond 899, the same being Bonds designated as Illinois and Michigan Canal
Bonds, and now outstanding, and for all moneys that may be paid by the State of
Illinois thereon, aud from all liability upou any Certificates, Intcres't Bonds, or other
evidences of Indebtedness that may have been issued on account of any of the Bonds
aforesaid, or the Canal Checks or Scrip for which Bonds were issued, and on any
Coupons now or heretofore attached to said Bonds, or any of them, and from all costs,
expenses and damages that may accrue against the State of Illinois by reason of the
eaid Bonds, Certificates, Interest Bonds, Coupons, or other evidences of Indebtedness;
and also, we jointly and severally agree and bind ourselves to repay to the State of
Illinois, within five years from the 19th day of February, 1859, any money that has
heretofore been piiid by the State on account of said Bonds, Certificates, Interest
Bonds, Coupons, or other evidences of Indebtedness, and for the interest on the Canal
Checks or Scrip upon which said Bonds were issued, aud in the purchase by the State
of any of said Bonds, Certificates, Interest Bonds, Coupons, or other evidences of In-
debtedness, arising out of the funding of said Canal Checks or Scrip, upon which
gaid Bonds were issued, together with six per cent, per annum interest on each and
every sum of money paid by the State upon such Bonds, Certificates, Interest Bonds,
Coupons or other evidences of Indebtedness, or for said interest, or in the purchase
of said Bonds, Certificates, Interest Bonds or other evidences of Indebtedness, or any
of them, to be computed from the time when any such sum or sums of money «hall
have been paid. And if at any time the Governor, Auditor and Treasurer of the
State of Illinois shall believe that thesecuriiy given by the said Joel A. Mattcson has
depreciated, and that the same has become inadequate, and shall require of the said
Joel A. Matteson to give additional security, and said Mattcson shall not give such
additional security within sixty days after a notice in writing shall have been given
him by the said Governor, Auditor and Treasurer so to do, then the sum of money
secured to the State as aforesaid shall become and be deemed due and payable from
jthe time of such default.
Witness our hands and seals, this 21st day of April, 1859.
J. A. MATTESON, [seal]
ROSWELL E. GOODELL, [seal]
JNO. McGINNESS, Jr., [seal]
C. S. MATTESON, [seal]
Attest, S. T. LOGAN.
State op Illinois,
Auditor's Office.
I Jesse K. Dubois, Auditor P. A. of Illinois, do hereby certify that the above
and foregoing is a true copy of the original document now in my possession as
Auditor,
Given under my hand and official seal, at Springfield, this 6th day
[seal] of May, 1859.
JESSE K. DUBOIS,
Auditor.
Q. By Mr. W. E. Moore. "What were those mortgages
given for, wbicli you have described in the two foregoing an-
swers ?
33
A, They were given in accordance with an act of the last
Legislature, entitled "An act to indemnify the State of IllU
nois ao-ainst loss bv reason of unlawful funding of Canal In-
debtedness," approved February 19th, 1S59.
Q. By Mr. W. E. Moore. Do you, or do you not, know
that Gov. Matteson has been in the habit, for some time past,
of purchasing Canal Scrip or 90 day Canal Checks and various
other kinds of State Indebtedness ?
A. I never heard him or any other person talk about there
being such an Indebtedness as ninety day Canal Checks or
Scrip, until Gen. Fry showed me one in February last (said
to be counterfeit). I have often heard Gov. Matteson say he
wanted to purchase State Indebtedness to place as security
in his Banks, but do not now remember that I ever saw him
purchase any.
Q. By Mr. Geo. Power. If the Bonds funded under Gov.
French, or any other Governor previous to Gov. Matteson
could be traced to the person or persons for whose benefit
they were funded — and if it was not Gov. Matteson who in-
augurated the present system of funding, so as to be able
to trace for whose benefit they were funded and by whom
funded ?
A. The funding of the State Indebtedness not being in any
manner connected with the Auditor's Ofiice, I have no know-
ledge how or in what manner the same has been done, except
occasionally seeing Mr. Moore at his desk, he being the Sec-
retary of the Fund Commissioner, who is Governor of the
State ; and I never had the time nor curiosity to investigate
the manner in which it was done, having no power vested in
me to change it, if I wished to.
3fay 10th, 1859.
John G. Nicolay sworn.
Q. Tell all you know relative to the late fraud alleged to
have been committed on the State, if anything.
—5
34
A. Some cl.iys, I think, after the investigation by the Sen-
ate Comimttee liad begun, I was inquired of first by Mr.
Alexainler Starne, and, in a few minutes afterwards, by Gov,
Matteson, concerning a bhick trunk wliich was sealed, and
which they mentioned as, perhaps, containing some Scrip or
papers rehiting to the investigation then going on. It was, I
think, on or about the 4th of February last, about four o'clock
in the afternoon. I got the keys to some t)f the basement
rooms in the State House, and, at Gov, Matteson's request,
went with him to lind the trunk. Mr.' Starne, Mr. AVm,
Crane and Mr. Kehoe went with ns. "We found the trunk in
one of the west rooms iti the basement. It was still sealed,
and, at Gov. Matteson's request, I cut the tapes which formed
the seals and opened the trunk. It seemed to be full of Can-
celed Scrip, and was then taken up stairs and afterwards ex-
amined by the Committee of the Senate. Gov. Matteson also
inquired concerning another box, which he said resembled a
shoe box. I knew nothing about it. I helped him search for
it in the basement, but did not find it. I was afterwards ex-
amined, under oath, by the Senate Committee, and gave them
substantially the above testimony.
Thomas Conner sworn. •
Q. 'Were you or were yon not acting as porter at the State
House in the spring of 1853 ?
A. 1 came into the State House as porter after McXamara
died, about '48 or '49, I don't recollect which. I remained
there during Gov. Matteson's time.
Jesse K. Dubois recalled.
Q. By the Foreman. Have you in your possession, as
Auditor, bonds numbered 900 to 992 and 993, inclusive ?
A. I have.
Q. Who placed them there, and for whose benefit, if you
know?
A. Bonds ]^o. 900 to 900, inclusive, were deposited March
6th, 1857, by Lotus Niles, Attorney of State Bank of Illinois
35
at Shawn eetown ; bonds No. 961 to 971, inclusive, deposited
in same Bank, March 24tb, 1857, by same person; bonds No.
973 to 993, deposited by E. Moore, Attorney, 26th March,
1857, in same Bank, and circuhiting notes were issued npon
the above bonds, which notes inured to the benetit of the
owners of the State Bank of Illinois, Shawneetown, of which
I always understood Gov, Matteson to be the principal.
Q. By Mr. George Power. Are there any other stock-
holders in that Bank ?
A. I understand, from our record, that there are other
stockholders — other than Gov. Matteson.
Q. By the Foreman. lias Joel A, Matteson, at any time
since the funding of the bonds above described, in executing
any instrument of writing or otherwise, acknowledged that he
owned the bonds described by numbers in your answers
above ?
A. I do not now recollect of having ever seen any other
instrument in writing from Gov. Matteson concerning the
above bonds other than the mortgages executed by him and
wife. We have frequently talked about the bonds, and I
always understood from him that the bonds were his, and were
placed in the State Bank to secure its circulation in part.
Q. Have you in your possession interest bonds numbered
from 37 to G9, inclusive ; and, also, Nos. 36 and 70 ? If so,
please state who exercises ownership over them.
A. The bonds named in the above question are now owned
by the State of Illinois, and no one has a right to exercise
ownership over them, they having been redeemed and can-
celed.
Q. From whom were the interest bonds, numbered from
37 to 69, inclusive, purchased ; and, also, bonds No. 36 and
70?
A. These bonds were originallv in the name of the
Auditor, in trust for the use of the State Bank of Illinois, and
were by me purchased from Gov. Matteson, by the sanction
of Gov. Bisseil, at 97 cents to the dollar, I think in or about
36
the middle or last of November, 1858 — it may possibly have
been in December — and were drawn from the Bank by Lotus
Niles, Attorney, for the warrant for the money.
Q. Can you tell the jury anything about interest bonds
numbered from 162 to 160, inclusive, and interest bond Is'o.
170 ? If yea, tell the Jury all you know about them.
A. Interest bonds 'No. 162 to 169 were originally deposited
in the State Bank of Illinois by W. C. Wood, Vice-President,
April Sth, 1857, and sold to me, for the use of the people of
the State ot Illinois, by Gov. Matteson, with the sanction of
Gov. Bissell, at 97c to the dollar, in Xovember, 1858, and
were withdrawn by Lotus Niles, Attorney of State Bank,
November 16th, 1858, and warrant for the money was receipt-
ed on Auditor's books by Lotus Niles, Attorney.
Gkaxd Jury Eoom, May 9t/i, 1859.
During the examination of a witness yesterday, the Sheriff,
Mr. Kidd, handed the letter hereto attached, addressed to J.
B. White, to the Foreman, and said he was directed by Mr.
White to lay it before the Jury. The letter was then read by
the Foreman at the req^uest of the Jury:
COPY.
Springfield, III., May 2, 1859.
Dear Sir : — As the investigation in relation to the funding of Canal Checks has
been transferred from the Committee of the State Senate to the Grand Jury of San-
gamon county, and as the object of such investigation, if entered upon, should be to
ascertain the whole truth, we would suggest to the Grand Jury, through you, the
names of the following witnesses, who were examined before the Committee, bnt
whose names are omitted in the published letter of Messrs. Dubois, Hatch and Miller,
Tiz : L. P. Sanger, B. C. Cook, Isaac B. Curran, Asa H. Moore, William Smith, Reu-
ben L. Anderson, N. H. Ridgley, R. E. Goodell, John Neibitt, Lotus Nilcs. Also^
Wm. II. Bissell, whose letter (though himself not examined) was read before said
Committee.
Also, the names of the following new witnesses, who can make most important dis-
closures, and whose testimony may be conclusive, viz : Augustus R. Knapp, of Jer-
seyville; 0. H. Pratt, of La Salle. Very respectfully, yours,
STUART & EDWARDS.
James B. White, Esq.
P. S. — In addition to the foregoing witnesses we would suggest the name of Michael
Heinrickson, who resides in Lincoln, Illinois. STUART & EDWARDS'
37
Thomas "W. Kidd sworn.
Q. Please tell the Jury where you got the above attached
letter, and what was your iuotruction from the person to you
relative thereto.
A. I went into the Court House on yesterday afternoon,
and it was handed to me by Mr. J. B. White, the State's At-
torney, with the request that I would hand it in before the
Grand Jury, and request the letter read. [The envelope
which inclosed the foregoing letter is marked " C," and is at-
tached as a part of the evidence. It is addressed as follows :
" J. B. White, Esq., Fresejit:']
J. B. White sworn.
Q. Are you the Prosecuting Attorney of this Judicial Dis-
trict? If yea, please examine the letter above attached,
marked " B," and tell the Jury all you know about it ; also,
whether you read the letter before you sent it to the Grand
Jury, if you did so send it.
A. I am State's Attorney for the 18th Judicial Circuit,
composed of the county of Sangamon and others. I think I
did open a letter on yesterday, but did not read it. I merely
glanced at tliat letter. I do not know whether the letter
marked " B " is the letter or not. Enveloj^ " C " is the envelop
in which the letter I handed T. W. S. Kidd was handed to
me. The envelop was handed me unsealed, and I handed it
to said Kidd (who is the officer waiting upon the Grand Jury)
unsealed, with a request for him to lay the same before the
Grand Jury. The letter I handed to Kidd was, as I recollect,
handed me by B. S. Edwards, Esq., who requested me to read
it and give it to the Grand Jury.
John T. Stuart sworn.
Q. Are you one of the firm or partners of Stuart & Ed-
wards? If so, are you practicing law as Attorneys in Sanga-
mon Circuit Court ?
A. I am. I am practicing law in Sangamon Circuit Court.
38
Q. Please examine the letter attached on the preceding; pao:e
marked "13," and tell the Jury whose hand writing it is in,
and if it was written by either of the partners. If so, which ?
Also, had it your sanction ?
A. The letter is in the hand writing of George Car[)enter,
Clerk of our ollice. The letter in question was planned and
written by Stuart & Edwards, and copied at our request. It
had my sanction, and I am responsible for it in every manner,
and I handed it to the Prosecuting Attorney, and I am ready
and desire to assign my reasons for writing it.
Q. Are you, or is the firm of Stuart & Edwards, the Attor-
neys of Joel A. Matteson ?
A. We are.
Maij lOM, 1859.
The testimony was here closed, when the Jury instructed
the Foreman to put the vote.
AVe, of the Jury, agree to vote on the above testimony,
whether we will find a true bill against Joel A. Matteson for
larceny :
William Butler A true bill, James Maxcy Xot a true hill.
on the above testimony.
C. Sami)S(in, Not a true bill.
William Vermillion A true bill.
Cyrus W. ^'anderen A true bill.
William A. Lockridge A true bill.
Andrew Kaueh A true bill.
Armstcad M.Sims A true liill.
M'illiam Patterson A true bill.
Harrison Baker A true bill.
Joseph MeDaniel A true bill.
Edward Perkins Not a true bill.
Geo. Power Not a true bill.
A. D. JMcGraw Not a true bill.
Joel Ballard Not a true bill.
Jesse Ruble A true bill.
W. D. Meggs Not a true bill.
Thos. A. Kerlin A true bill.
M'm. P. Grafton Not a true bill.
John W. Priest Not a true bill.
Washington E. Moore Not a true bill.
Samuel Clark A true bill.
Samuel 11. Joues A true bill.
Decided a true bill ; 13 for, 10 against.
3Iay nth, 1859.
Mr. Wm. A. Lockridge moved to reconsider the vote taken
on yesterday, to-wit : the finding of a bill against Ex-Gov.
Matteson.
Motion seconded by Mr. Priest.
The vote was then put by the Foreman calling the names
of Jurors :
E 11 II A T U M .
The vote takou May lOlh, should reaU—
AVm
t^anipsi
. Vcrnii
llion,
\ true bill,
.Not a true bill.
Th
"not wiis in'f
idcntally trau.«po.sefl by the oonipcsilor.
39
Geo. Power , Aye.
A. D. McGraw Aye.
Joel Ballard Ayo.
.Tussc I'luble Nay.
W. D. MegKs Aye.
Thomas Kerlin Nay.
Wra. P. Cnifton Ayo.
J<ilin W. Priest Ayo.
Washington E. Moore Aye.
Samuel Clark Aye.
Samuel II. Jones Nay.
William Butler Nay.
Council Samp on Nay.
William Verm ill iou Aye.
C. W. Vanderen Aye.
AVilliam A. Luckridj^e Aye.
Andrew Rauch Aye.
Armsteail Sims Nay.
William Patterson Nay.
Harrison Baker Nay.
Jo.n-ph McDaniel Nay.
Edward Perkins Aye.
James ftla.xcy Aye.
Ayes 14, nays 9. The Jury resolved to reconsider.
The vote was then put by the Foreman : Shall the main
question on finding a true bill be now put ? and decided in
the affirmative.
The Foreman then stated : The question now is, Shall we
find a true bill against Joel A. Matteson on the foregoing tes-
timony ?
V/m. Butler A true bill.
Council Sampson A true bill.
William Vermillion Not a true 1^11.
Cyrus W. Vanderen A true bill.
'\\'illiam A. LockriJge A true bill.
Andrew Ilauch A true bill.
Armstead M. Sims A true bill.
William Patterson A true bill.
Harrison Baker A true bill.
Jo.«eph McDaniel A true bill.
Edward Perkins Not a true bill.
James Maxcy Not a true bill.
For a true bill, 12; against, 11.
At five o'clock, Mr. TTm. A. Lockridge moved that the
Jury again reconsider the vote taken this forenoon on finding
a true bill against Joel A. Matteson for larceny, on the fore-
going evidence. Mr. Lockridge explains that his reason is,
that one of the Jurymen wishes to change his vote, and has
made it public in the Jurv Room.
Geo. Power Not a true bill.
A. D. McGraw Not a true bill.
Joel Ballard Not a true bill.
Jesse lluble A true bill.
William D. Meggs Not a true bill.
Thomas Kerlin A true bill.
William P. Crafton Not a true bill.
John W. Priest Not a true bill.
Washington E. Moore Not a true bill.
Samuel Clark Not a true bill.
Samuel H. Jones A true bill.
William Butler Nay.
Council Sampson Nay.
William Vermillion Aye.
Cyrus W. Vanderen Aye.
AVilliam A. Lockridge Aye.
Andrew Rauch Aye.
Armstead Sims Nay.
William Patterson Naj'.
Harrison Baker Nay.
J'iseph McDaniel Nay.
Edward Perkins Aye.
James Maxcy Ayo.
Geo. Power Ayo.
A. D. Mcdrraw Aye.
Joel Ballard Aye.
Jesse Ruble Nay.
Wm. D. Mcgga Aye.
Thomas Kerlin Nay.
Wm. P. Crafton Aye.
John W. Priest Ayo.
AVashington E. Moore Aye.
Samuel Clark Aye.
Samuel H. Jones Nay.
For reconsidering, 14 ; against, 9.
40
The motion was then made, by James Maxcy, for a final
vote, whether the Jury will find a true bill against Joel A.
Matteson for larceny, on the foregoing evidence. The call
was then proceeded with, as follows :
William Butler A
Council Sampson A
Willi.am A'crniillion Not a
CjTus W. Van Doren A
AVilliam A. Lockridgc A
Andrew Iluuch Not a
Ariustcad M. Sims A
William Patterson A
Harrison Baker A
Joseph S. McDaniel ..A
Edward Perkins Not a
James Maxcy Not a
For a true bill, 11 ; against, 12.
Mr. Wm. Butler then moved that the entire proceedings
in this case be pubhshed, after the adjournment of the Grand
Jury. Upon this motion Mr. Ci'afton called the ayes and
noes:
true bill.
true bill.
true bill.
true bill.
true bill.
true bill.
true bill.
true bill.
true bill.
true bill.
true bill.
true bill.
George Power Not a true bill.
A. D. .McOraw Not a true bill.
.Joel Ballard Not a true bill.
.Jesse Ruble A true bill.
W. D. iMeggs Not a true bill.
Thomas A. Kerlin A true bill.
\\m. P. Crafton Not a true bill.
John W. Priest Not a true ))ill.
Washington E. ^looro Not a true bill.
Samuel Clark Not a true bill.
Samuel 11. Jones A true bill.
William Butler Aye.
Council Sampson Aye.
Wm. Vermillion (believing it not ac-
cording to law) No.
Cyrus W. Van Deren Aye.
William A. Lockridge Aye.
Andrew Bauch Aye.
Armstead M. Sims Aye.
William Patterson Aye.
Harrison Baker Aye.
Joseph S. McDaniel Aye.
Edward Perkins Aye.
James Ma.xcy Aye.
Geo. Power (believing it not accord-
ing to law) No.
A. D. Mc(iraw Aye.
Joel Ballard Aye.
Jesse Ruble Aye.
W. D. Meggs Aye.
Thomas Kerlin Aye.
William P. Crafton Aye.
John W. Priest Aye.
Washington E. Moore ...Aye.
Samuel Clark Aye.
Samuel U. Jones Aye.
In favor of publishing, 21"; against, 2.
Springfield, May, 1867.
The forogoing evidence, taken before the Qrsnd IJury of Sangamon County, is correct, and
the original is now in my poBaesaion, subject to the iaapoctioa of au; who may dfiiro it.
WILUAM BUTTER.
Foreman Grand Jury.
N07B BY THE FoRTMATf. — In explanation of the reason of the repeated findings and recon-
Bide ations, it is proper to stnte, thut th • l'ro3>-ciUing .\ttorney omitted, during Ibe progress of
tiie in- eHtign'ion, and until after several votes had he n titkou, to furnish the .Jury witli a bill.
About spNeii o'clock on the PToiiinir of th" 11th. nftur the la-;t vnto had been takcD, arjil »hpti it
hail become generally known that an indictment wonld not bo f mnd, a bill was presented, with
the request that it nhoiild \m " ignored ;" but uodei' tht existing circuiuttauces I deemed it my
duty to decline to accept it.
REVIEW OF TESTIMONY
IN THE INVESTIGATION OF THE CANAL SCRIP FRAUD, BY THE
FINANCE COMMITTEE OF THE ILLINOIS STATE SENATE
AND THE GRAND JURY OF SANGAMON COUNTY, ILL,
About the first of February last, the fact was brought to
the attention of the officers of State and of the Legislature,
then in session, that a fraud had been perpetrated upon the
State in funding a certain class of indebtedness known as
Canal Checks of the issues of May and August, 1839. The
following resolution was immediately adojDted in the Senate,
empowering the Finance Committee of that House to investi-
gate the subject :
Whereas, it is said that a large amount, in Certificates of the Stock of the State,
has heen issued, based upon counterfeit or spurious Canal Scrip ; therefore,
Resolved, That the Finance Committee be instructed to inquire fully into the mat-
ters herein alleged, and report the same to the Senate, and that they have power to
send for persons and papers.
After several sittings, during which a large number of wit-
nesses were examined — most of whom had been public officers
under the internal improvement system of the State — this
Committee finally reported, under the above resolution, on
the 17th of February, a few days before the close of the ses-
sion. The investigation was conducted openly, and opportu-
nity afforded by the Committee for the introduction of testi-
mony bearing upon the subject, both on the part of the counsel
who appeared for the State, and in behalf of Gov. Matteson
who was present, personally and by counsel, during the whole
6--
42
of the investigation. The Committee continued to hear all
evidence produced, until the counsel for the State, and Gov.
Matteson and his counsel declined to introduce any more.
In their report, so far as it was not general, and relates to
this particular subject, the Committee content themselves
simply with giving a brief abstract of the evidence brought
before them, and proposing a plan for the indemnilication of
the State from loss in consequence of this fraud. They fur-
ther say that, " at divers times there has been paid to Gov.
Matteson, from the State Treasury, an amount of money, for
principal and interest, to make, with the bonds so issued to
him, the sum of $228,182 66, paid, or promised to be paid, to
Gov. Matteson on account of the Canal Checks so presented
by him."
On the recommendation of the Finance Committee, an act
was passed authorizing the Governor, Auditor and Treasurer
to receive from Matteson, within a certain time, satisfactory
security for the repayment of the above amount to the State,
within five years. The contemplated security was furnished,
■vfrithin the time specified, by mortgages upon real estate loca-
ted in different counties of the State, and also by an indemni-
fying bond entered into by Joel A. Matteson, as principal, and
R. E. Goodell, John McGinness, jr., and Charles Matteson,
securities.
On the 27th of April, with a view to a judicial investigation
of a crime known to have been committed by some one, this
subject was brought to the attention of the Grand Jury of
Sangamon county, by a joint letter from the respective heads
of the State Departments. As shown by the proceedings of
the Grand Jury, herewith published under authority of a
vote of that body, it was resolved, by an almost unanimous
vote, to enter upon the investigation as soon as the witnesses
could be in attendance. The investigation commenced on the
4:th of May, with the calling of Enoch Moore, Secretary in
the Fund Commissioner's office, as a witness, and was con-
tinued for several days. To examine the testimony adduced
43
before the Grand Jury, and that taken by the Finance Commit-
tee—which has also been published since the close of the session
of the Legislature — in fact, to present as brief a resume as pos-
sible of all that has been elicited, in an authentic manner, in
reference to this subject, will be the object of this article.
INVESTIGATION BY THE FINANCE COMMITTEE.
And first, in reference to the revelations before the Finance
Committee. The Committee, in their report, say :
In the year 1839, the proper officers of the Illinois and Michigan Canal, to meet
their pecuniary necessities, and, your Committee believe, pursuant to their power, by
Jaw conferred, issued $265,237 of what were called 90 day Checks, dated May 1,1839,
and due 90 days after date ; and they also issued $128,317 of similar Checks, dated
August 1, 1839. These Checks were, by them, put in oirculation for a temporary
purpose, from the Canal office at Lockport, Illinois, and were in part redeemed at the
Branch of the State Bank of Illinois, at Chicago, and a part were received for dueg
to the Canal, or otherwise redeemed at the Canal office.
While preparing the amount 8o issued, the officers who prepared and signed these
•Checks, not knowing how many they might need, partially executed and filled up for
future use, a large amount of ether Checks similar in their character, but were un-
trimmed, unregistered, and had not the Treasurer's name filled in.
How large an amount was so partially executed and filled up, your Committee
have not learned, because no register was kept of it, there ,• nor indeed of the others,
until they were actually issued by the Secretary for circulation, when he entered the
amount of the difierent denominations in a book kept for that purpose, from which ha
was able to determine the amount in circulation at any one time.
As these Checks were only intended for temporary use, it appears from the reports
of the Canal officers to the Legislature, in the year 1840, that they had redeemed
and taken up all of both the May and August issue, except $822; from similar re-
ports made in 1842-3, it appears that only $?23 was then in circulation, and from
various subsequent reports this amount was reduced to $316, which amount it was
supposed was lost or destroyed.
The witnesses called and examined by the Finance Com-
mittee were William H. Brown, Cashier of the Branch of the
State Bank at Chicago, from 1835 to 184i; Ezra L. Sherman,
Teller in the same from 1836 to 1840 ; Michael Kehoe, Porter in
the Canal office at Chicago, from 1847 to 1853 ; Enoch Moore,
Secretary in the Fund Commissioner's office ; John G. Nicolay;
Joel Manning, Secretary Board of Canal Commissioners from
1836 to 1845 ; John A. McClernand, Treasurer Canal Board
from 1837 to 1839 ; Jacob Fry, Acting Commissioner from 1836
44
to 1845, and State Trustee after the dissolution of the Board
in 1845 to 1847, and predecessor of Col. Oakley ; Alex. Starne,
Secretary of State under Gov. Matteson's administration ;
Thomas Conner, Porter in the State House during the same
time ; B. C. Cook, Senator from La Salle county ; Jesse K.
Dubois, Auditor of Public Accounts ; Wm. F. Thornton, Pre-
sident of Board of Canal Commissioners from 1839 to 1841 ;
A. J. Galloway, Clerk in the office of J. B. Wells, Canal
Trustee after the death of Col. Oakley, from 1849 to 1851 ;
Hart L. Stuart, Agent under Gov. French for the funding of
State indebtedness from 1847 to 1850 ; Josiah McRoberts,
Canal Trustee from 1853 to 1857, and one or two others ;
and those called by Gov. Matteson, viz : L. P. Sanger, I. B.
Curran, A. II. Moore, AVm. Smith, R. E. Goodell, Lotus Niles,
John Nesbitt and N. II. Ridgely.
To commence in the order of time after the issue of the
May and August Checks of 1839, referred to in the report of
the Finance Committee : It appears from the concurrent tes-
timony of Messrs. Brown and Sherman, of the Branch Bank
at Chicago, and of Messrs. Fry and Manning, of the Canal
office, that a part of the Checks were redeemed at the Bank
and a part at the Canal office. Mr. Brown, relying upon the
books of the Bank, testifies that $100 Checks of the May issue
to the amount of $167,000 were redeemed at the Bank, in
1839. Of the August Checks he says $31,471 were redeemed
at the Bank. Nearly all the above witnesses agree in saying
that the $50 and $100 Checks of both issues, redeemed at the
Bank, were not " canceled" or defaced, while the small ones
were, Mr. Brown also says, that all these amounts were re-
ceived at or before maturity, and were surrendered on the
check of the Treasurer of the Canal Board. The last of the
May issue was surrendered on the 16th of September, 1839,
and Mr. Brown thinks there were none redeemed by the
Bank in 1840, as the books do not show it. A report of the
Canal Commissioners, bearing date December 10th, 1839, ad-
duced in evidence, states that all the May and August issues
45
had then been withdrawn from circulation, except $4,039 of
the former, and $2,388 of the latter.
Messrs. Fry and Manning both state that nearly a year
after the date of the above-mentioned report, viz : early in
December, 1840, all the Checks then in the office of the May
and August issues, 1839 — both those redeemed at the Canal
office and those redeemed at the bank — both canceled and
uncanceled — were carefully counted by them and Mr. McFar-
lane, Mr. Manning's clerk, and, together with the unfinished
Checks of the August issue, packed in a box prepared for the
purpose. This box was then sealed with the seal of the Canal
office, taken by Mr. Manning to Chicago, and deposited in
the Branch Bank of the State of Illinois. Mr. Manning at
first was not clear whether more than one box was taken up
at that time ; but the receipt of Mr. Brown, the Cashier, was
produced in evidence stating that it was " one large box, said
to contain Canal Scrip." The date of this receipt is Decem-
ber 5th, 1840.
In reference to the contents of this box, Mr. Fry testified
that it " contained all [of the May and August Checks] that
were in the office at the time." Mr. Manning testified that,
when the box was packed, the Checks of the May and August
issues which had been redeemed ^^were all iJieri'' — that none
were missing, except a few of the smaller denominations of
the May issue, and two or three of the $50 and $100 Checks
of the August issue, which were still in circulation. [ There
was another box, similar to a candle box, which Mr. Manning
says he afterwards packed at the Bank with small Scrip, and
which he says contained about $25,000. This, however, plays
no important part in this investigation. We mention it now,
only because it will appear in another connection hereafter.]
A report of Mr. Fry, Acting Commissioner, of the date of
December 21st, 1840, alluded to in the foregoing quotation
from the report of the Finance Committee, says that, at that
date, there remained unredeemed and in circulation of the
May Checks, $722, being all of the denominations of $10 and
46
less, and one $100 Check of the August issue. Mr. Fry also
stated that the amount packed in the box corresponded with
the report — that " it was all 2)(icJ^<^d in that box, except the
amount reported there.'*''*
It now hecomes our duty to trace this box as closely as pos-
sible; as it was, undeniably, by means of the uncanceled and
unfinished Checks deposited therein that this enormous fraud
•was perpetrated.
Mr. Brown testifies to the receipt of the above described box
in 1840 ; says it was placed in the vault of the Bank at Chicago ;
that he occasionally saw it there, and "it a])parently remained
intact;" that he had no doubt it went away in the same con-
dition in which it came; supposes he delivered it to Kehoe.
Michael Kehoe, porter in the Canal Office at Chicago, testi-
fies that, "in 1848, Col. Oakley (then State Trustee) sent him
down, with an order, to Mr. Brown's, at the old Bank at Chi-
cago, for two boxes and two packages." One of these boxes
he describes as a candle hox., and the other answers to the
description of the box containing the May and August Checks
deposited by Mr. Manning, in 1840. lie says he brought it
to the Canal Ofiice, and it remained there until Mr. McRob.
erts came into office, in 1853. He never saw what was in the
boxes — believes Mr. Bradford, a clerk in the office, opened
the candle box,_6aw it contained "old scrip," and covered it
down. Kehoe also testified that, in 1853, after Mr. McRoberts
came into office, he assisted the latter to pack up the contents
of the two boxes and some packages in the safe in the Canal
Office ; that they were packed part in a trunk and part in a
shoe box; that the trunk and box w^ere addressed to "Hon.
Joel A. Matteson, Springfield, Illinois;" that he accompanied
them to the cars, on the following morning, and delivered
* A slight discrepancy occurs in the testimony here. The rcceij)t of Mr. Brown to
Mr. Manning, for the box containing the May and Angust Chocks, in the jiulilishcd
report, bears date " December 5th, 18 lU ;" whereas, Mr. Fry fiays that the boj was
jiacked lictwccn the 21st and the 2jth— evidently belicvin;^ tiiat tiie box was received
by iMr. Urown on the 2jth. We are inclined to believe tliat there is an error in the
copy of the reeeijit, and that Mr. Fry's uudoratauding was correct — though tho
poiut is UDiniportant.
4r
them to Mr. McRoberts, who was going to Joliet. Kehoe
identified the trunk wliich was found in the State House, and
was produced before the Committee during the investigation^
as the same which had been packed by himself and McRob^
erts in the Canal Office ; but the shoe box was not found.
The trunk was examined and found to contain nearly twa
millions and a half of indebtedness of different kinds, among
which were $50 Checks to the amount of $21,800, and $100
Checks to the amount of $11,800, of the May issue, 1839, and
$26,400 in $100 Checks, of the August issue, 1839. All the
above pcijters were cwneeled. The Investigating Committee, in
their report, speaking of this trunk, say, '•'' there were ujpon it
some appearances of having heen sealed twice, as if opeiied and
sealed againP
Mr. Mclloberts, Canal Trustee from 1853 to 1857, (having'
been appointed by Gov. Matteson,) and successor to J. 13.
Wells, corroborated the testimony of Kehoe with reference to
the packing of the trunk and shoe box in the Canal Office,
their being addressed to " J. A. Matteson, Springfield, 111.,"
and their delivery to Matteson at the Depot of the Rock Island
Railroad. He further stated that he took possession of the
office on Saturday, March 22d, 1853 ; that the packing was
done on the next (Sunday) morning ; that the lid of the smal-
ler or candle box was loose ; that he examined some of the
packages in that box, and found they did not hold out ; those
he saw were canceled; did not remember seeing any $50 or
$100 ninety day Checks; that he tried to put the large sealed
box in the trunk, and afterwards in the shoe box, and neither
would receive it ; that Kehoe then broke open the sealed box,
and he (McRoberts) took out its contents and packed them
in the shoe box or the trunk, or in both ; and that the contents
of the smaller box and the other papers in the safe were pack-
ed in the same manner.
Mr. McRoberts also testified that the contents of the sealed
box were in large packages, bound with tape and pasteboard ;
he did not open the packages, but simply laid them in the
48
box ; they seemed to be " undisturbed," and in the same con-
dition in which they were first packed ; did not examine them
60 as to know what they were; and that the description by
Messrs. Fry and Manning of the box which they packed with
May and August Checks of 1839, at the Canal Office at Lock-
port, corresponded with that of the sealed box which he re-
ceived from Gov. "Wells and broke open. Mr. Brown, on
being recalled, stated that he received such a box as that de-
scribed by Messrs. Fry and Manning.
McRoberts, having received the box and trunk from Kehoe
at the Rock Island Railroad Depot, went with them to Joliet.
There he met with Gov. Matteson. The next day, or the day
following that, he and Gov. Matteson started to LaSalle to-
gether, and brought the box and trunk with them. Gov.
Matteson was on his way to Springfield, and McRoberts
delivered the box and trunk over to Matteson at La Salle, and
they were put into the baggage car, to be taken across the
river and shipped on the Illinois Central Railroad. That
ended McRoberts' connection with the trunk and box.
To this point, viz : the delivery of the trunk and box into
the hands of Matteson, the chain of evidence is complete —
each link is unbroken — the conclusion inevitable and irresisti-
ble. Messrs. Brown, Sherman, Fry and Manning agree as to
the manner of issue and redemption of the May and August
Checks, 1839 ; that by far the largest proportion of the $50
and §100 Checks of these issues were redeemed at the Bank ;
that they were counted as cash and not ^'"canceled f that they
were returned to the Canal Office in the same condition.
Messrs. Fry and Manning testify and their official reports
prove that in December, 18^0, the whole of these issues had
been retired from circulation, except a few hundred dollars
of the first and a single hundred dollar Check of the last : they
agree that the whole of these Checks about the same time, in
the condition in which they came from the Bank, were packed
in a box at the Canal Office, sealed with the seal of the office,
and by Mr. Manning taken to Chicago and deposited in the
49
Branch Bank at that phace. Mr. Brown testifies that he re-
ceived this box; that it remained in the Bank until 1848; that
in that time he believes it to have been unbroken; that in
1848 he delivered it into the hands of Kehoe, to be taken to
the Canal Office; that when he delivered it, it was in the
same condition in which he received it. Kehoe testifiies to
having received the box from Mr, Brown at the Bank ; that
(with other matter) he removed it to the Canal Office ; that it
remained in the Canal Office, apparently in the condition in
which it was received, until Mr. McRoberts came into office ;
that it was then broken open and its contents packed into the
trunk or shoe-box, or both, and taken to the Rock Island Rail-
road Depot and placed in charge of Mr. McRoberts.* Mc-
Roberts states that a box answering to the one described by-
Messrs. Fry and Manning, and the same spoken of by Kehoe
as having been received from the Bank, was in the Canal
Office at the time he came into it ; that it was sealed and ap-
parently unbroken ; that he and Kehoe broke it open ; that its
contents appeared to have been undisturbed ; that they trans-
ferred them to the shoe-box or trunk, or both ; that they were
addressed to "J. A. Matteson, Springfield, 111.;" that he (Mc-
Roberts) received the same from Kehoe at the Rock Island
Railroad Depot, at Chicago; that he took them with him to
Joliet, and delivered them into the hands of Matteson at La
Salle.
Although Gov. Matteson was present, with counsel, during
the whole of the investigation, and each witness was subjected
to a most rigid cross-examination, there was nothing elicited
in contradiction of these facts.
So far, the history of the sealed box containing the uncan-
celed Canal Checks of May and August, 1839, and the course
taken by its contents, has been traced clearly, and it is shown,
beyond the shadow of a doubt, that they came into the hands
of Matteson.
* A. J. Galloway, a Clerk in Gov. Wells' office from 1S>^9 to 1851, swears that two
boxes were in the office, at that time, sealed j and were bj him delivered to Gov.
WoUs, sealed, when ho left the olBce.
—7
50
Now, in rcijanl to the indebtedness funded by Gov. Matte-
son, the Finance Committee, in their report, say :
"The greater part of the Checks so presented by hitn are recognized by General
Thornton, General Fry and Mr. Manning as the genuine fifty and one hundred dol-
lar Checks of Miiy Ist and August 1st, IS.'5'J, by them is-sued and redeemed as herein-
before stated, and as part of the redeemed Checks packed ))y Mr. Manning and Gen.
Pry in the box deposited in the Bank at Chicago, in the year 1840.
"There is also found among the Checks, funded by Gov. Matteson, two packages
of the Checks dated August 1st, 1839, amounting to $10,500, which are fresh in ap-
pearance, have the edges untrimined, but fully signed by the Commissioner and Sec-
rctarj- of the Canal Commissioners, indorsed by the Treasurer of the Board, but want-
ing tlie name of the Treasurer filled in upon their face, and lying upon each other in
consecutive numbers."
"About $ 3,000 of the Cheeks funded by Gov. Matteson appeared to be specially
indorsed to Wm. II. Brown, Cashier, and not re-indorsed by him."
There was much evidence to prove that the May and
August Checks ot 1839 were not in circuUition after 184:0
to 1812. Mr. Brown thinks that no considerable amount was
in circulation in 1810. Mr. Sherman might have seen some
of it, but '• no amount, however." Enoch Moore states that
none of them were funded during Gov. French's administra-
tion — that two Checks of the May issue, one $50 and one $100,
were funded in the name of " John Johnson," April, 1853,
that three $1100 Checks of the same issue were funded for Mr.'
Ridgely in October, 1851, and that two Checks, of SI 00 each,
were funded for Charles Thompson, in July, 1856 : but all
these have since been discovered to be counterfeit. Several
other witnesses testify that some two or three thousand dol-
lars of counterteit Scrip were put in circulation in 1839, but
such counterfeits were at once detected by the Canal officers,
and some of the parties punished for forgery. These,
plainly then, could not have come from the box of geiv-
nine Checks deposited in the Branch Bank at Chicago, and
afterwards reboxed by McRoberts and placed in the hands of
Gov. Matteson. Mr. Dubois testifes that he never saw any of
any kind of ninety day Canal Checks, either counterfeit or
genuine, until he saw the counterfeit piece shown to him by
Gen. Fry. Mr. Manning says it M'as known in the Canal
office that the ninety day Checks issued by the Canal officers
51
Lad mostly been retired. Mr. Galloway says such ninety day
checks " had mostly disappeared before his advent, in 1841."
Gen. Thornton never saw any of those issues hi circulation
after he left the Canal office in 1841.
Ilart L. Stuart, a contractor on the Canal in 1839, and
agent for the State for the purpose of funding State indebted-
ness trom 1817 to 1850, having been appointed by Gov. French,
states that, although it was generallj known he was engaged
in funding State indebtednes, and had advertised himself as
such in New York city, and probably funded from $400,000
to $600,000 of various kinds, yet he never received more than
$150 to $200 of the May and August issues, 1839, and those?
" all of the small denominations." He thinks they did not
generally circulate " more than six or eight months, or a year
at farthest" — " don't recollect seeing any of them of any ac-
count the year after thev were first circulated." This, of it-
self, is sufficient to prove that the Checks packed by Messrs.
Fry and Manning could not again have been put in circulation
up to 1850 — even if it were not known that they were still
safe in the box at the Canal office.
The testimony of Messrs. Thornton, Fry, Manning and
Brown was clear, as stated in the report of the Finance Com-
mittee, in reference to the identity of the Checks said to have
been funded by Gov. Matteson, with those redeemed by the
Bank, and afterwards packed in the Canal office in 1840. The
testimony of Enoch Moore was positive that the whole of these
Checks had been handed to him by Gov. Matteson, to be fund-
ed in different names, at various dates, from the 9th of Jan-
uary, 1857, to the 18th of March of the same year, and that he
knew no other person in the transaction besides Gov. Matteson.
He also stated that he had never seen a single one of the (pre-
tended or real) individuals in whose names this indebtedness
had been funded, (except William Smith, for whom $ 300 of
the lots had been funded,) and no testimony was offered to prove
that any of them had an existence.
B. C. Cook was introduced by Gov. Matteson to prove that
he (M.) had bought State indebtedness of Cook in 1867. It
52
was proved, however, that the indebtedness sold by Mr. Cook
was Internal Improvement Bonds and Interest Canal Scrip of
1840. i\o 7Mr^ of it was of the May and August issues, lb39.
So nothing was elicited pertinent to the investigation.
Messrs. Sanger, Curran, A. II. Moore, Smith,GoodelI, Niles,
Nesbitt and Ridgely, were called by Matteson to prove that
he was engaged largely in the purchase of State indebtedness
during the winter of 1856-7, and that he obtained large sums
of money from the Bank at Joliet and elsewhere, to be used
(as was understood) in the purchase of such indebtedness.
Sanger stated that he had seen Matteson buying indebtedness
of ditferent parties whom he did not know, at various times —
claimed to have been " familiar" with Canal Scrip — thought
he bought some of the May or August Scrip, 1839, in New
York, three years ago — thought he sold it to Matteson — was
not certain that he did so — did not I'noiv there icere two issues
in 1839 — thought the Scrip he saw Matteson buying was
ninety day Checks, but could not tell whether they were
of the May or August issue. Curran claimed to have seen
Matteson buying ninety day Canal Checks at the St. Nicholas
Hotel, in Springfield, in the winter of 1856-Y — was introduced
by Matteson to some of the parties who sold, but could not
tell their names nor where they came from, or other particulars
— was not familiar with the May and August issues, 1839 —
only remembered there were $50 and $100 ninety day Checks
— knew no other facts. Asa H. Moore's testimony was to
the same purport — had never noticed the denomination
more than once — could not identify the May and August
Checks as the same he saw Matteson buying. Smith and
Goodell swore to Matteson's procuring a large amount of money
from the Bank at Joliet, which, they understood, was to be
used in purchasing State indebtedness.
So much for the testimony before the Investigating Com-
mittee. We come now to that taken before the Grand Jury
of Sangamon County.
5^
INVESTIGATION BY THE GRAND JURY.
The witnesses who appeared before the Grand Jury were :
Enoch Moore, Jacob Fry, Joel Manning, Wm, II. Brown,
Michael Kehoe, Josiah McRoberts and John G. Nicolaj, all
of whom were examined by the Finance Committee; also De-
puty Sheriff T. W. S. Kidd, J. B. White and John T. Stuart.
The testimony elicited by the Grand Jury corroborated
that brought before the Investigating Committee, except that
it was more clear and direct, and less burdened with extrene-
ous and irrelevant matter. The same facts were not only con-
firmed, but new ones elicited.
Certain bonds were identified by numbers in the testimony
of Enoch Moore as having been issued on the funding of
Canal Checks of the May and August issues, 1839, Moore
also stated that the Checks were handed to him by Gov, Mat-
teson at different times — that the Checks were funded in the
names of other parties, but that the bonds issued on such fund-
ing were received by Gov. Matteson — that he did not know
any of the persons in whose names the Checks were funded,
except Wm. Smith, to w^hom $300 was funded in January,
1857. Mr. Dubois swore that these bonds, identified by num-
bers, or a large proportion, were deposited with the Treasurer
as security for the circulation of certain Banks in which Mat-
teson is interested. There was a difference between Matteson
and the State ofiicers in reference to $13,000 funded in the
name of John Kellogg and Caleb Johnson, during Matteson's
administration. Matteson claimed that, although he present-
ed the Checks, yet he did it as a public officer for other parties,
and that he received no benefit therefrom, and therefore that
lie should not be compelled to idemnify the State therefor. A
letter (which is published with the evidence) from O. F. Lowe,
of New York, to Enoch Moore, states that "soon after the
issue of the first bonds for the ninety day Scrip, I [he] sold
for Gov. Matteso'ni)'' the tdentical bonds received therefoi*, viz :
bonds numbered 886 to 899, inclusive — and that they are now
held by some Banks in Illinois or Wisconsin. The $300
64:
funded to tlie name of "Win, Smith was included in tliesc bonds
— being part of bond 809.
Gen. Fry's testimony was substantially the same as that he
gave before the Investigating Committee. lie identified the
Checks produced before the Jury (which Mr. Moore had
already identified by numbers as those presented by Matteson
to be funded) as the same Checks of May and August, 1830,*
issued by the Board of Canal Commissioners — testified to the
fact that they had been ])aid at the Bank at Chicago, or at the
Canal oftice — that all, both those redeemed at the Bank and
at the Canal office — the former in the condition in which they
were received from the Bank — were packed in a box by him-
self and Mr. Manning, in December, 1840, which box was
afterwards sealed and by the latter deposited in the Branch
Bank at Chicago.
Mr. Manning's testimony was to the same purport, viz : as
to the whole amount of the Checks, their character, the man-
ner of issue and redemption, the return of the redeemed
Checks from the Bank to the Canal office ; the fact that all the
redeemed Checks in the office at the time mentioned by Gen.
Fry, were carefully examined, counted and packed in a box —
that this box, having been sealed, was taken by him to Chica-
go and deposited in the Bank — that at that time there was
only $722 of those issues still out — that the Checks of the de-
nominations of $50s and $100s received from the Bank were
not cut with a canceling hammer, and had been so packed, &c.
lie said, " most of the Checks now before me, (meaning those
of the May and August issues funded by Matteson,) brought
in by the Auditor, are the same that were j9a6'/('(?(^ in the hoxP
He recognized the unfinished Checks of the August issue as
those which had been packed in the box, and thought they
could never have been in circulation.
*Mr. Frj' states that the amount of the May Checks of 1839 prepared, was as fol-
lows : Of the regular Checks, $219,324, and of the irregular Checks $49,735, making
in all $269,059. Of this amount he says $3,822 were, for some reason, subsequently
rejected, and never put in circulation, leaving $265,237 for the amount actually put
in circulation, which agrees with the report of the Senate Investigating Committee,
as quoted in the preceding part of this summary.
65
Mr, Manning also testified, that in the spring of 1841, he
went to Chicago for the purpose of receiving the small at
sight Checks of $1 00, $2 50 and $5 00— that he did so re.
ceive them, and having carefully counted them, put them up
in packages, with the amounts marked on the packages, which
he afterwards deposited in a box which he called " box JSTo.
2" (also, he says, by some called the canclle-hox) — that a list
of the packages in this box was taken by Mr. Howe, the clerk,
and one copy (he thinks) deposited in the box, and the other
received by himself, which he still has — that this box was
sealed up and left in the care of the Bank — that the Checks
put in it " were all cut vnth the canceling hammer,^'' either by
Mr. Howe or Mr. Brown.
Mr. Brown again testified to the redemption by the Bank of
about $LTO,000 of the May and August Checks, 1839, pre-
vious to IGth September, 1839 — to the fact that the larger
Checks were uncanceled, and were so delivered to the Trea-
surer of the Canal Board. He recognized many of the Checks
placed before him as those which must have been redeemed
by the Bank, as they were specially indorsed to him — stated
that he had never put any of them into circulation — testified
to the receipt of the box described by Messrs. Fry and Man-
ning, also to the receipt of the candle-box packed at the Bank
by Manning, in 1811, and to the delivery of these two boxes
to some one from the Canal office in 1848 or 1849. He fur-
ther said : " The boxes, while in my possession, were never
opened by me, or, as I believe, by Mr. Howe, my clerk. For
the last'"^ve years I had exclusive possession of the keys of the
vault, and it was not opened by any one but myself."
Kehoe testified, as before, to receiving the abovementioned
boxes at the Bank in 1848, and their removal to the Canal
office, where they remained until McRoberts came into office,
in 1853. Their contents were then placed in a trunk and shoe-
box, as already described, these were directed to Matteson at
Springfield, taken by him (Kehoe) to the Rock Island Rail-
road and delivered to McRoberts. Kehoe says, "the candle
lox was shuch in one corner with standino; on it at the canal
56
Scales — the office was so throng with the people." lie also
eajs, " Thomas Bradford looked at the corner of it, to see
what was in it one time" — believes " he said it was canceled
SeripP Kelioe i)lainly knewthe larger box, containing the
May and August Checks, to be still sealed and uninjured.
McRoberts, more clearly than before the Investigating Com-
mittee, testified to having received from his predecessor
(Gov. Wells) in 1853, among other matter, two boxes, one of
which (the smaller, or candle box) was open, and the other,
which was sealed, and " which had the impression of the seal
of the old Board of Commissioners upon it" — says he ex-
amined " the box that was open, and found that it contained
canceled ninety day Checks — the contents of some of the pack-
ages "did not hold out" — "from the appearance of the box,
some of the packages had been taken out." He again recite^
the breaking open of the sealed box — says they " found it con-
tained packages done up between two pieces of pasteboard cut
the size of the box — the packages were laidlinbetvveenthepaste-
boards — the pasteboards were then wrapped with tape or twine
and (he thinks) sealed with sealing wax." {_Query : If this box
had ever been opened before — especially for a fraudulent or fel-
onious purpose — is it at all probable that its contents would have
been found so carefully packed and in so good condition, as is
evident from this description they were ? Even if there were no
direct testimony to prove that it had never been opened before,
would not this circumstance be conclusive ?] They "cut the
tape, took out the packages and put a part in the trunk and a
part in the box, or the whole in one or the other," he can-
nut say which. lie describes the packing of the contents of
the smaller Ijox and other packages found in the safe, in the
trunk or shoe-box, or both, in the same manner, substantially,
as Kelioe — thinks the trunk and shoe-box M'ere sealed, but is
not certain — says he directed them to '' J. A. Matteson, Spring-
field, Ills." — that he received the same from Kehoe at the
Eock Island Railroad Depot on the following morning — that
lie took them with him to Joliet, there met with Matteson,
57
went witli him (M.) to LaSalle, and there delivered the trunk
and box to Matteson, to be brought to Springfield.
The investigation before the Finance Committee and that
before the Grand Jury then arrive at the same result. The
trunk and hox jpass into the hands of Matteson at La Salle.
Nothing further is known of them or their contents, until it is
discovered that a fraud has been committed in the funding of
a certain class of indebtedness, which all this evidence goes to
prove was packed in them. Gov. Matteson then suggests a
search for the trunk. It is found in one of the basement rooms
of the State House, but it is filled with a large amount of in-
debtedness of dilferent varieties, all canceled. He then says
something about the shoe-box, and search is made for it also,
but it is not found. The Investigating Committee, speaking of
the trunk, say, ." there loere iipoji it so?ne apjyearances of ham7ig
heen sealed twice, as if opened and sealed again.'''' One of two
conclusions is unavoidable — either all the contents of the seal-
ed box, containing the May and August Checks, were put by
McKoberts in the missing shoe-box ; or the trunk and box must
have been broken open by some one having access to tliem,
the contents of both which were unavailable or useless, packed
in the former, and the box, with its available contents, spirited
away. The latter is the more probable ; for if any j)ortion of
the uncanceled Checks were deposited by McRoberts in the
trunk and it had never been opened after it passed out of Mc-
Eoberts' hands until it was opened on the 4th of February last,
they ought to have been there still— for the trunk was full when
found. Another ground for this theory is the fact that the
trunk contained a considerable quantity of canceled ^50 and
% 100 May and August Checks, which must originally have
been in the sealed box which came from the Bank.
But what became of the shoe-box? The uncanceled May
and August Checks, whether deposited in it or not, plainly
must have gone with it. The last known of it, itis in Matteson's
hands in 1853. The Checks proved by the chain of evidence
to have been deposited in it or in the trunk, on in both, at the
Canal ofiice, in 1853 — and which are not now found in the
—8
68
trunk — turn up again in Mattcson's hands in 1857. Is any
explanation, 8upi)orted by evidence, given of the manner in
which he came by them? Is any satisfactory explanation giv-
en — or attempted — for the disappearance of the box? Is any
serious effort made to find a single one of the pretended parties
in whose names the Checks now found to be purloined, were
funded i Has a single one of the many parties, who, it is
chiinied, sold these Checks to Matteson, presented himself,
although this investigation luis been notorious from one end
of the Union to the other? Has any effort been made to find
one of them? Have they been advertised for and requested
to come forward ? They are certainly not all rogues, and the
statement of one or two of them would go fai- to explain this
mystery. Has the fact ever been developed, beyond a doubt,
that any one else besides Matteson has ever held, or now holds,
any part of the $ 60,000 or $ 70,000 of this class of indebted-
ness still missing?
In addition to all this evidence — the uncontradicted and
concurrent testimony of men having held high official positions
and of unim])eached character — there is this remarkable fact,
in itself unanswerable and overwhelming: that all of the gen-
uine Checks of the May and August issues, 1831), presented for
payment a second time by funding, have been so presented by
Matteson. If these Checks were thrown upon the market and
were received in the ordinary course of business, were not oth-
er dealers as liable to receive them ? Yet we have no evidence
that they have ever. been offered to others — certainly, none
that any one else has ever funded, or attempted to fund, a sin-
gle dollar of them. Mr. Sanger, it is true, thought he had
bought some such in New York, but he was not clear upon
this point, and did not know the difference between the May
and August issues ! ISo one else claims to have seen them
until they made their appearance in the Fund Commissi(jner's
Office. They are presented. Check after Check, by the same
hand, until more than §200,000, of principal and interest, have
been funded, and it seemed, almost, that "the end is not yet."
Eut if, by contrived evidence, by impudent suggestion or
69
villainous insinuation the suspicion of liaving abstracted these
Checks could be fastened on a dead man^ (the ever ready ex-
pedient of knaves,) it would still be left to explain how they
came into Matteson's hands — it would still need to be explain-
ed how he came to purchase clean blank scrip, with untrim-
med edges, and running in consecutive numbers — it would
still be to explain why he procured the bonds to be issued in
the names of fictitious persons — it would still be to exphun
how the Scrip escaped from a box which the witnesses testify
was sealed, and presented no sign of having been opened until
opened by McRoberts and its contents delivered to Matteson —
it wonld still be to explain wluit had become of the shoe-box —
an almost endless number of mysterious questions would spring
up, demanding a solution.
Before the Grand Jury, as shown by the minutes, there
were some singular exhibitions. The vacancies in the Grand
Jury, instead of being filled by the Court from the panel of
the County Court, as i-equested by the Jurj^, was tilled from
the ^'■bystanders.'''' These added Jurors, as will be seen by
the votes, with a single exception, voted steadily against find-
ing a bill, and this exception changed his vote on the second
ballot. Then, there was the exhibition of the lawyers of the
implicated party, through the Prosecuting Attorney, and with-
out rebuke by the Court, either at or after the fact, boldly in-
terfering with the Jury to prevent an indictment — the indig-
nant demonstrations of jurors who talked about bribes being
offered them, then quietly cooled down and changed their votes.
Last came the exhibition of votinc: an indictment and recon-
sideriiig. It is matter of notoriety that, after all the evidence
was in, an indictment was voted by sixteen to seven,' though
this vote was informal, and was not, therefore, entered upon
the journal. Next, without additional evidence or argument,
a reconsideration was had, and an indictment again voted, by
thirteen to ten. A new reconsideration, and an indictment
by twelve to eleven. Still another reconsideration, and an in-
dictment refused, hj eleven to twelve/ After all this, which
consumed two entire days, as shown by a note by the Foreman,
the Prosecuting Attorney presented the draft of an indictment,
with the sno-o-estion that it mii>;ht be ''io-nored !" The suff-
gestion, which would have cast off future investigation, was
not acted upon, however.
And thus, for the present, this curious case rests — the in-
dividual found in possession of the booty standing acqm'tted,
60
^v^t^lOut being re<i[uircd even to explain how lie came by it;
while those who dared, in justice to the interests otlthe pe<>])le
of the State, to ask for an investigation, are driven to defend
themselves for doing so !
The case is a most remarkahle one — remarkable, in view of
the magnitude and boldness ol the fraud and the metliod of
its accomplishment — remarkable^ in view ot the financial rep-
utation and political and social position of the party most
deeply (if not alone) implicated — remarkable, in view of the
absence of ordinary motive or temptation (in necessity, at
least,) to the commission of such a crime — remarkable, in its
history before the Grand Jury; in the means employed to
stitle investigation, and their apparent success ; in the repeated
findings and reconsiderations, without apparentimotive or rea-
son for the change, such as might be furnished by the acquisi-
tion of new information ; in the omission of sworn officers to
discharge a plain dut}^ so long as there was any prospect that
an indictment would be found ; and in the proffering of the
bill when it could be employed to the advantage of the impli-
cated part}^ ; in the impudent interference of the counsel of
the implicated party in endeavoring to influence the Grand
Jury, and introduce witnesses for the defence, as if on a final
trial, although the law expressly declares that, " in all com-
plaints exhibited before the Grand Jury of any county, they
shall hear the vntnesses on hehcdf of the ])eo])le milyf and,
lastly, it is remarkable, in the incessant abuse, both during
and since the investigation, of every person suspected of a de-
sire for a thorough exposure of all the facts, in order that sus-
picion may fasten upon the really guilty party.
In view of all this sworn evidence bearing in the same direc-
tion, with nothing to directly contradict or discredit it — every
part of which is not only in harmony with and corroborative
of the other parts, but all of which is corroborated by whatever
is purely circumstantial in the case — what is the conclusion of
the whole matter? Let each intelligent, candid and un])reju-
diced man, having read and weighed the testimony, decide
for himself what conclusion is possible and inevitable.
The purpose announced at the beginning of this article has
been fulfilled. The important and leading facts and circum-
stances of the case have been placed before the public as fully
as was consistent with reasonable limits, and, at the same
time, as clearly and succinctly as possible. The matter is be-
fore the public, to be judged by the simplest rules of evidence
and the irresistible logic of the facts.
I
/
.^•s
^^ -^f
UNIVERSITY OF ILLINOIS-URBANA
3 0112 073934611
^.
^K ^ ^:
r -v
^ -5-
<^.>*
>
■"I
'I'
i9r m ■
^r"
?J' /
4 it'
►'*•<
^
iA#w^-
.■-::r
