Theodore Roosevelt: An Autobiography
to overstate the value of the service rendered in all these cases
by such cabinet officers as Moody and Bonaparte, and their outside
assistants of the stamp of Frank Kellogg.
It would be useless to enumerate all the suits we brought. Some of
them I have already touched upon. Others, such as the suits against the
Harriman railway corporations, which were successful, and which had
been rendered absolutely necessary by the grossly improper action of the
corporations concerned, offered no special points of interest. The Sugar
Trust proceedings, however, may be mentioned as showing just the kind of
thing that was done and the kind of obstacle encountered and overcome in
prosecutions of this character.
It was on the advice of my secretary, William Loeb, Jr., afterward head
of the New York Custom-House, that the action was taken which started
the uncovering of the frauds perpetrated by the Sugar Trust and other
companies in connection with the importing of sugar. Loeb had from time
to time told me that he was sure that there was fraud in connection with
the importations by the Sugar Trust through the New York Custom-House.
Finally, some time toward the end of 1904, he informed me that Richard
Parr, a sampler at the New York Appraisers' Stores (whose duties took
him almost continually on the docks in connection with the sampling of
merchandise), had called on him, and had stated that in his belief the
sugar companies were defrauding the Government in the matter of weights,
and had stated that if he could be made an investigating officer of
the Treasury Department, he was confident that he could show there was
wrongdoing. Parr had been a former school fellow of Loeb in Albany, and
Loeb believed him to be loyal, honest, and efficient. He thereupon laid
the matter before me, and advised the appointment of Parr as a special
employee of the Treasury Department, for the specific purpose of
investigating the alleged sugar frauds. I instructed the Treasury
Department accordingly, and was informed that there was no vacancy in
the force of special employees, but that Parr would be given the first
place that opened up. Early in the spring of 1905 Parr came to Loeb
again, and said that he had received additional information about the
sugar frauds, and was anxious to begin the investigation. Loeb again
discussed the matter with me; and I notified the Treasury Department to
appoint Parr immediately. On June 1, 1905, he received his appointment,
and was assigned to the port of Boston for the purpose of gaining
some experience as an investigating officer. During the month he was
transferred to the Maine District, with headquarters at Portland, where
he remained until March, 1907. During his service in Maine he uncovered
extensive wool smuggling frauds. At the conclusion of the wool case, he
appealed to Loeb to have him transferred to New York, so that he might
undertake the investigation of the sugar underweighing frauds. I now
called the attention of Secretary Cortelyou personally to the matter,
so that he would be able to keep a check over any subordinates who might
try to interfere with Parr, for the conspiracy was evidently widespread,
the wealth of the offenders great, and the corruption in the service
far-reaching--while moreover as always happens with "respectable"
offenders, there were many good men who sincerely disbelieved in the
possibility of corruption on the part of men of such high financial
standing. Parr was assigned to New York early in March, 1907, and at
once began an active investigation of the conditions existing on the
sugar docks. This terminated in the discovery of a steel spring in one
of the scales of the Havemeyer & Elder docks in Brooklyn, November 20,
1907, which enabled us to uncover what were probably the most colossal
frauds ever perpetrated in the Customs Service. From the beginning of
his active work in the investigation of the sugar frauds in March, 1907,
to March 4, 1909, Parr, from time to time, personally reported to Loeb,
at the White House, the progress of his investigations, and Loeb in his
turn kept me personally advised. On one occasion there was an attempt
made to shunt Parr off the investigation and substitute another agent of
the Treasury, who was suspected of having some relations with the sugar
companies under investigation; but Parr reported the facts to Loeb,
I sent for Secretary Cortelyou, and Secretary Cortelyou promptly took
charge of the matter himself, putting Parr back on the investigation.
During the investigation Parr was subjected to all sorts of harassments,
including an attempt to bribe him by Spitzer, the dock superintendent
of the Havemeyer & Elder Refinery, for which Spitzer was convicted and
served a term in prison. Brzezinski, a special agent, who was assisting
Parr, was convicted of perjury and also served a term in prison, he
having changed his testimony, in the trial of Spitzer for the attempted
bribery of Parr, from that which he gave before the Grand Jury. For his
extraordinary services in connection with this investigation Parr was
granted an award of $100,000 by the Treasury Department.
District-Attorney Stimson, of New York, assisted by Denison,
Frankfurter, Wise, and other employees of the Department of Justice,
took charge of the case, and carried on both civil and criminal
proceedings. The trial in the action against the Sugar Trust, for the
recovery of duties on the cargo of sugar, which was being sent over the
scales at the time of the discovery of the steel spring by Parr, was
begun in 1908; judgment was rendered against the defendants on March
5, 1909, the day after I left office. Over four million dollars were
recovered and paid back into the United States Treasury by the sugar
companies which had perpetrated the various forms of fraud. These frauds
were unearthed by Parr, Loeb, Stimson, Frankfurter, and the other men
mentioned and their associates, and it was to them that the people owed
the refunding of the huge sum of money mentioned. We had already secured
heavy fines from the Sugar Trust, and from various big railways, and
private individuals, such as Edwin Earle, for unlawful rebates. In the
case of the chief offender, the American Sugar Refining Company (the
Sugar Trust), criminal prosecutions were carried on against every living
man whose position was such that he would naturally know about the
fraud. All of them were indicted, and the biggest and most responsible
ones were convicted. The evidence showed that the president of the
company, Henry O. Havemeyer, virtually ran the entire company, and was
responsible for all the details of the management. He died two weeks
after the fraud was discovered, just as proceedings were being begun.
Next to him in importance was the secretary and treasurer, Charles R.
Heike, who was convicted. Various other officials and employees of the
Trust, and various Government employees, were indicted, and most of
them convicted. Ernest W. Gerbracht, the superintendent of one of the
refineries, was convicted, but his sentence was commuted to a short
jail imprisonment, because he became a Government witness and greatly
assisted the Government in the suits.
Heike's sentence was commuted so as to excuse him from going to the
penitentiary; just as the penitentiary sentence of Morse, the big New
York banker, who was convicted of gross fraud and misapplication of
funds, was commuted. Both commutations were granted long after I left
office. In each case the commutation was granted because, as was stated,
of the prisoner's age and state of health. In Morse's case the President
originally refused the request, saying that Morse had exhibited
"fraudulent and criminal disregard of the trust imposed upon him," that
"he was entirely unscrupulous as to the methods he adopted," and
"that he seemed at times to be absolutely heartless with regard to the
consequences to others, and he showed great shrewdness in obtaining
large sums of money from the bank without adequate security and without
making himself personally liable therefor." The two cases may be
considered in connection with the announcement in the public press that
on May 17, 1913, the President commuted the sentence of Lewis A. Banks,
who was serving a very long term penitentiary sentence for an attack on
a girl in the Indian Territory; "the reason for the commutation which is
set forth in the press being that 'Banks is in poor health.'"
It is no easy matter to balance the claims of justice and mercy in such
cases. In these three cases, of all of which I had personal cognizance,
I disagreed radically with the views my successors took, and with the
views which many respectable men took who in these and similar cases,
both while I was in office and afterward, urged me to show, or to ask
others to show, clemency. It then seemed to me, and it now seems to me,
that such clemency is from the larger standpoint a gross wrong to the
men and women of the country.
One of the former special assistants of the district-attorney, Mr. W.
Cleveland Runyon, in commenting bitterly on the release of Heike
and Morse on account of their health, pointed out that their health
apparently became good when once they themselves became free men, and
added:
"The commutation of these sentences amounts to a direct interference
with the administration of justice by the courts. Heike got a $25,000
salary and has escaped his imprisonment, but what about the six $18 a
week checkers, who were sent to jail, one of them a man of more than
sixty? It is cases like this that create discontent and anarchy. They
make it seem plain that there is one law for the rich and another for
the poor man, and I for one will protest."
In dealing with Heike the individual (or Morse or any other individual),
it is necessary to emphasize the social aspects of his case. The moral
of the Heike case, as has been well said, is "how easy it is for a man
in modern corporate organization to drift into wrongdoing." The
moral restraints are loosened in the case of a man like Heike by
the insulation of himself from the sordid details of crime, through
industrially coerced intervening agents. Professor Ross has made the
penetrating observation that "distance disinfects dividends"; it also
weakens individual responsibility, particularly on the part of the very
managers of large business, who should feel it most acutely. One of the
officers of the Department of Justice who conducted the suit, and who
inclined to the side of mercy in the matter, nevertheless writes: "Heike
is a beautiful illustration of mental and moral obscuration in the
business life of an otherwise valuable member of society. Heike had
an ample share in the guidance of the affairs of the American Sugar
Company, and we are apt to have a foreshortened picture of his
responsibility, because he operated from the easy coign of vantage of
executive remoteness. It is difficult to say to what extent he did,
directly or indirectly, profit by the sordid practices of his company.
But the social damage of an individual in his position may be just as
deep, whether merely the zest of the game or hard cash be his dominant
motive."
I have coupled the cases of the big banker and the Sugar Trust official
and the case of the man convicted of a criminal assault on a woman. All
of the criminals were released from penitentiary sentences on grounds of
ill health. The offenses were typical of the worst crimes committed
at the two ends of the social scale. One offense was a crime of brutal
violence; the other offenses were crimes of astute corruption. All of
them were offenses which in my judgment were of such a character that
clemency towards the offender worked grave injustice to the community
as a whole, injustice so grave that its effects might be far-reaching in