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this bill, in the beginning of the section, these such regulations as may be made. Now we great body there are no seizures. There are words:
provide that no compromise can be made except no seizures except in regard to whisky and That in all cases arising under the internal rev- with the written assent of the Secretary of the tobacco. It seems to me the committee have enue laws where, instead of commencing or proceed- Treasury; and further than that, in order to sufficiently guarded this section. If the Sen. ing with a suit in court, it may appear to the Commissioner of Internal Revenue to be for the interest
show that it cannot be done upon insufficient ate, upon the second reading of the bill, of the United States to compromise the same information, we require another officer to file choose to strike out the whole section, that is
That seems to refer to a civil proceeding, his opinion in writing, setting out certain facts, another question ; but my own judgment is although technically not necessarily so. But the basis of the opinion by the Secretary of the that you cannot administer the collection of the proviso at the end of the section reads Treasury.
the internal revenue without trusting somethus :
It may be said that we ought to make the body with the power to adjust disputes, and That it shall be lawful for the court at any stage
opinion of the solicitor of internal revenue compromise both before and after suit. All of such suit or criminal proceedings to continue the final. That would not be right. Otherwise, the checks and all the guards that may reasonsalino for good cause shown on motion of the district
we ought to leave it entirely to him. But with || ably be suggested to guard against the abuse
the aid of this written opinion the case is made of this power I am perfectly willing to vote for; The whole matter by this section in the up, goes to the Commissioner of Internal Rev. || but the power itselt must be provided for by future is to be left with the district attorney, as enue, is decided by him, and if his opinion in this bill. it has been in the past.
favor of compromise is approved by the Sec- Mr. EDMUNDS. Mr. President, I did not Now, sir, you start out with this great fact:
retary of the Treasury in that particular case, get any answer to my inquiry from the chairthat substantially the enforcement of this law
it is made unless, forsooth, a suit has been man of the committee, who I supposed was heretofore has been almost a total failure; in
commenced. If a suit bas been commenced, familiar with the bill, whether there is any view of the fact that there have been less than the bill, as it came to us from the House of provision in this proposed law for requiring a twelve convictions where there have been Representatives, required the assent, in addi. prosecution, as he calls it, a suit, to be comthousands of offenses, you may say a total fail- tion, of the district attorney. In order to menced against any property seized within a ure; and yet you leave the machinery for com- avoid the objection to that I intended, at the definite period of time? promising and defeating this system in the
proper stage of this bill, to move to strike out Mr. SHERMAN. No, sir. There is a same bands in which it has almost totally failed so much of it as provides for the assent of the statute of limitations against cominencing it heretofore. Sir, the compromise system is the district attorney, and to require the assent of after a certain time. bone of our revenue system. Let us have no
the Attorney General. This would make it Mr. EDMUNDS. That we understand. compromise at all. Let us have every case harmonious. In all matters that arise before That is quite a different thing. The result of tried through. If you leave that door open at suit, the case must be settled by the Commis. it then would be, as the section will stand with all the great body of offenders will walk out sioner of Internal Revenue with the advice and this amendiaent put in, while the power of through it. They have done so heretofore, consent of the Secretary of the Treasury, and compromise would be left with the Commis. and they will do it again. I want no com- npon the opinion in writing of the solicitor of sioner of Internal Revenue, with his solicitor promise. If there is an offense committed, let internal revenue. That surely is a sufficient and the Secretary of the Treasury indefinite it be tried out. If the man is innocent, let the guard. After a suit is commenced I would and absolute, there would be no obligation on court say so; if the man is guilty, let the court
require all these other aids or checks, and in the part of those officers, or anybody else, ever say so; but when you prepare a door of com- addition to them the opinion of the Attorney to commence a suit in the world. They might promise and leave it open in the law the great General.
hang up a seizure, therefore, just as long as body of offenders will march out through it, as To require the opinion of the Attorney Gen. || they pleased, until the party whose property they have done heretofore. Are we such eral in advance on matters not brought into || had been seized could, through the instruiBourbons here that we cannot learn anything court at all would be to burden him with the mentalities that the Senator from Indiana has by experience? That would seem to be the whole weight of the business of the Comunis. so well referred to, bring sufficient influence fact.
sioner of Internal Revenue. Thousands and to bear to produce a compromise. Mr. SHERMAN. The only question now tens of thousands of cases arising out of I do not see any difference in theory or in before the Senate—and it is rather surprising, || ignorance or mistake or misapprehension or justice between requiring a check from the after running along almost through the bill, that errors on the part of officers come to the Com- Attorney General's office after a libel, if that we should all at once be stopped by such a missioner of Internal Revenue, and are decided is the proper term, has been filed or before or small pebble—is whether the compromises pro- as matters of formula. If every one of those after a seizure has been made. If you leave vided for by this section shall be approved by (ases must be brought before the Secretary of it as it now stands, á case may be hung up the solicitor of internal revenue
or by the
the Treasury or the Attorney General we indefinitely; and then comes on the party whose Secretary of the Treasury. That is the only || might as well provide for half a dozen Attor- property has been seized, who has committed question before the Senate. The general mer: neys General. He could not do it. But when the fraud, with his friends, and gets his memits of the proposition to allow compromises to a suit has been commenced and is pending, ber of Congress, or his Senator, to go first 10 be made will come up at a later stage, when it and a proposition is made to compromise that the solicitor, and then to the Commissioner, will be open to amendment. I say the ques. suit, we may then properly ask for the opinion and then to the Secretary. Failing there, he tion we are to vote upon--no motion to amend
of the Attorney General. There is, then, a goes to the fountain-head of all honor and all is in order at present-is whether we shall good deal of force in the objection made by pardon, the President of the United States; make compromises upon the advice and con- the Senator from Indiana that the opinion of and at last through some of those officials he sent of the solicitor of internal revenue or
the district attorney, who, perhaps, is inter- gets off entirely. That is altogether wrong in of the Secretary of the Treasury. Now, let || ested, or who, by possibility, may be corrupt; my opinion. It bas been, as my friend from os look at that for a moment. The solicitor
or who is lazy, indolent, careless, and would Indiana has said, the greatest abuse in this of internal revenue is an officer of secondary || rather settle a suit than try it, should not be country--this matter of compromising these importance, a mere adviser of the Commis- final. I think it would be very proper there claims before any process is filed in court where sioner of Internal Revenue, a mere aid of a to interpose the opinion or assent of the Attor parties upon both sides can see exactly what bureau officer. There is none now appointed, ney General.
the charge is, and exactly how much the Gov. and the duties of the office are being performed Mr. EDMUNDS. Will the Senator permit | ernment would be entitled to have by way of by a clerk. Therefore, to make his opinion a me to ask him if there is any provision in this forfeiture or the duplication of the tax, as the check upon the Commissioner of Internal Rev
bill fixing within what lapse of time after a case might be made. enue would be the same as to say that the Sec- seizure is made, an information or proceeding In the external revenue service experience retary of the Treasury's action must depend | shall be filed in court against the property has provided a much more satisfactory way. upon the opinion of a clerk, because that is seized ?
The laws and regulations prescribe that within the effect of it.
Mr. SHERMAN. That reminds me of ten days, I believe that is the number of days Mr. MORTON. I did not argue that ques- another observation. More than nine cases -a very short period of time after a seizure is tion. I argued against the whole section. out of ten are cases where no seizure has been made, a libel shall be filed, so that the judicial
Mr. SHERMAN. I know; but that is not made. For instance, suppose a mistake in the officers of the Government, whose bounden before us at present. That is what I am com- case of the income tax. The question comes duty it is to protect the Government against plaining of. The point before us is quite a before the Commissioner of Internal Revenue frauds of this kind, will have their hand upon different question from the one that has been whether a certain man has been assessed prop- the prosecution, as well as the mere executive argued.
erly for income. There may be no seizure. officers of the Government; so that you then Mr. MORTON. I think it is before us. There may be no property to seize. The only have an additional safeguard not only as to the
Mr. SHERMAN. Now we interpose the remedy may be by suit. The Commissioner rights of the citizen whose property may have Secretary of the Treasury, and require his of Internal Revenue has the case made up been illegally or improperly seized, but you advice and consent to every compromise that before him, and he may say, “it is better on have a safegard for the rights of the Governis made in every individual case. Under exist- all the facts of the case to take so much money ment that no private settlement brought about ing law the Secretary of the Treasury has in settlement of this claim than to commence by political favor, personal influence, corrupnothing to do with compromises unless his regusuit."
tion, bribery, or whatever improper influence lations require it. The Senator from Maine Mr, EDMUNDS. There may be no seizure may be brought to bear, can be had. says that under the existing regulations they in an income case. There the prosecution No provision of that kind is made here ; and must be submitted to the Secretary ; but under must be personal.
while you give an absolute and indefinite power the law the Commissioner of Internal Revenue Mr. SHERMAN. As a matter of course of compromise and settlement to these mere passes finally upon them, subject, however, to this section applies to all cases, and in the executive officers, you do not impose upon
them any duty at any time which would be a resistance by the party assessed, and the case strain him, and to bring the case into court; corresponding check of proceeding against the comes before him in the light of a judicial but the oflicer may go on and enforce the sale property in court. The result is that you sur- officer. Now, the question comes up before of the property without any legal proceedings. render the whole thing into their hands, and him, “Shall I sue?" He decides that in the However, upon complaint, and upon an apour experience has shown, as the Senator from first place. He says “It is better on the whole peal, in any stage of the proceedings, it comes Indiana has so well said, and I need not repeat for the interests of the Government that this before the Commissioner of Internal Revenue, it, that it has been the greatest abuse in the matter should be settled." Under the existing and i ben he deterinides whether or not he will way of collecting taxes and the imposition of law he can settle it without limitation.
call te his aid the courts. burdeus that this country has ever experi- Mr. EDMUNDS. Does that apply to seiz. Mr. EDMUNDS. Do I understand the Senenced.
ures, or only saits for underrating taxation? ator from Ohio to say that in a case of seizure As the Senator from Ohio has said, all this Mr. SHERMAN. That applies to all pro- for a forfeiture instead of a seizure to enforce does not necessarily and exactly arise upon ceedings of every kind and description. the collection of taxes by sale of the property, this precise amendment; but when we are Mr. EDMUNDS. Read that clause.
the collector of the internal revenue tax may voting one thing out and another thing in Mr. SHERMAN. I will read section forty- dispose of that property finally without a decree without any explanation, the implication would one of the present law, so that I shall not have of condemnation of a court ? fairly arise that we were satisfied with what we to read it in another portion of the argument:
Mr. SHERMAN. I do say so, and I say it were voting in and were satisfied to leave it in
That it shall be the duty of the collectors afore- has been done, and is done, and is provided Chat condition. I do hope we shall make some said or their deputies, in their respective districts, for by this bill. The very portion of the bill change that will impose upon these officers the and they are liereby authorized, to collect all the
which has been passed upon provides in case taxes imposed by law, however the same may be duty of prosecuting the property in court so designated, and to prosecute for the recovery of any
of forfeiture how the sale shall be conducted, that there will be a check upon thein, or else sum or sumns which may be forfeited by law; and all the mode and manner of proceeding. As a that we shall have this check enlarged by fines, penalties, and forfeitures which may be in
matter of course any person believing himself curred or imposed by law, shall be sued for and referrring it to some other department of the recovered in the name of the United States, in any injured has a right to appeal to the courts, Government, like that of the Attorney Gen. proper form of action, or by any appropriate form of and so the United States may, on an order of eral.
proceeding, qui tam or otherwise, before any circuit
the Commissioner, appeal to the courts. Mr. WILLIAMS. I wish to inquire of the within which said fine, penalty, or forfeiture may
Mr. EDMUNDS. Then, may I ask my Senator from Verinont if he understands that have been incurred, or before any other court of com- friend, if the United States have the right, in every case of seizure it is necessary to pros.
petent jurisdiction. And tases inay be sued for and
under the power of seizure, to sell the forfeited ecute a suit in court under this act?
proper form of action before any circuit or district property without any steps of a court at all, Mr. EDMUNDS. I do not know whether court of the United States for the district within what is the object of their ever taking a step it is or not. I know it ought to be. I know
which thelialility to such tax may bave been or shall
in court? Why file a libel if they can sell the Constitution says a man shall not be de- is due may reside at the time of the commencement
without a libel? That cannot be the construcprived of his property without due process of
of suid action. But no such suit shall be commenced tion of the act. I am very much mistakenlaw.
unless the Comunissioner of Internal Revenue shall
my friend from Ohio will pardon me if I say Mr. TRUMBULL. Before the Senator from
That in case of any suit for penalties or forfeitures so-if he is not confusing himself by confoundOregon goes on, I ask him to allow me to pro
brought upon information received from any person, ing the case of a seizure of a man's property
other than a collector, deputy collector, assessor, pose a distinct amendment and see if the Senassistant assessor, revenue agent, or inspector of in
under a warrant to compel him to pay what he ator from Ohio and the committee will not ternal revenue, the United States shall not be subject owes, and the seizure of his property for a agree to it. Instead of the committee's amend- to any costs of suit, &c.
criminal violation of law which forleits the ment, I suggest that we take the House sec- Mr. EDMUNDS. That is not the question property itself. In this last case I am very tion as it is down to the ninth line, and after which I wished answered. I am alluding to a inuch mistaken, I repeat, if the law is not, and the word "writing,” in the ninth line, insert case of seizure for a violation of the law by has not always been, tbat before the United "and be approved by the Attorney General.” fraud or otherwise, for the forfeiture of the States can dispose of that property they must
Mr. JOHNSON, How will it read then ? very thing, as the seizure of a distillery of file an information or a libel against it in a Mr. TRUMBULL. It would read in this whisky. I wish to ask him if forfeitures of proper court, and have it tried where the wise:
that kind are prosecuted by the collector of claimant may appear and defend himself, and That in all cases arising under the internal revenue internal revenue instead of by the district condemed by the judgment of the law. That laws where, instead of commencing or proceeding | attorney in court?
class of cases that I am alluding to. with a suit in court, it may appear to the Commismissioner of Internal Revenue to be for the interest of the United States to compromise the same, he is
when an actual suit is commenced, it is by the necessary for us to pursue the various and empowered and authorized to make such compro- district attorney. A seizure is not considered devious proceedings of the law; but I have mise with the advice and consent of the solicitor of internal revenue, whose opinion in the case, with
in these proceedings in the light of a suit. | stated to the Senate what I understand to be, the reasons therefor, shall be given in writing and Provision is made for proceedings of various and what is daily practiced, the ordinary mode be approved by the Attorney General and delivered kinds before suit is commenced. A seizure of proceeding in the collection of internal to the Commissioner.
is made by an officer, and finally by an appeal revenue. Either party, the claimant or the Then before the Commissioner settles the the merits of the case on the face of the United States, through the Commissioner of case he would have the opinion of the solicitor papers, are brought before the Commissioner Internal Revenue, may at any time appeal to of internal revenue approved by the Attorney of Internal Revenue. He then, for the first the aid of the courts. General.
time, decides whether he will appeal to the Mr. EDMUNDS. What does the Commis. Mr. SHERMAN. As I said before, I have courts to enforce that seizure, or enforce that sioner want of the aid of the courts if he can an amendment on my table already prepared tax, or that claim, whatever it may be ; and sell the property? to make the opinion of the Attorney General he directs it to be done either in one form of Mr. SHERMAN. In not one case in a hun. necessary after suit is brought.
action or another. He directs a prosecution dred is there property to seize. Mr. TRUMBULL. This would not subject in criminal courts; he direct a qui tam pro- Mr. EDMUNDS. I am speaking of the the Attorney General to very great labor, be- ceeding; perhaps a seizure, or he directs a suit. seizure of property. cause he would not prepare an opinion him- Mr. EDMUNDS. I am speaking of the case Mr. SHERÄAŃ. Then he must appeal to self, but would revise and examine the opinion of seizure alone for the time being, so that we the courts, and where a private individual is of the solicitor, and would bave simply to shall understand each other; whether in a case aggrieved he has a right to appeal to the courts. indorse it “ approved."
of seizure of property as forfeited, and which Either siile may appeal. The only question Mr. SHERMAN. It would subject him to must be proceeded against in rem— the Uni- now is whether the solicitor of internal rev. labor that the Attorney General cannot possibly ted States against so much property seized for e
enue or the Secretary of the Treasury ought perform. In order to understand this matter, a violation of the revenue laws? - whether a to be selected as the advising aud consenting you must take it generally; you have got to prosecution of that description ought not to officer to a settlement. Whether the Attorney examine several laws. It is utterly impossible go into court, and be controlled by the same General ought to be added in the multiplied for him to do it. If the Senator wishes inform- | principles that relate to seizures for violations cases that would arise where no suit is to be ation on the subject, I will try to give it to of external revenue, where, as the Senator brought, is for the Senate to decide. I say to him. The forty-first section of the internal knows, the law has always provided that the impose that duty on the Attorney General revenue law, as it now stands, authorizes suits | prosecution, as he calls it, the suit against it, where no suit is pending, to pass merely in by collectors to collect all taxes and to enforce the libel should be filed within ten, or a cer- revision upon the acts of the Commissioner of all fines, penalties, and forfeitures. No suit, tain number of days? That is the point to Internal Revenue in the ordinary discharge of however, can be commenced without the sanc- which I wished to call attention.
his duty, would be to incumber his office with tion of the Commissioner of Internal Revenue. Mr. SHERMAN. I have already answered a mass of details totally inconsistent with the In the great multiplicity of these cases a suit that. As I understand it, it is not necessary discharge of the duties of that high office. does not grow out of one in a hundred of them. at all to go into court to commence à suit or Even the amendinent that I intend to propose, They are decided first by the assessor, whose any proceedings in court to enforce a seizure. requiring his assent to the settlement of cases decision may, by appeal of the interested party, The officer goes on in pursuance of the author- where suits are pending, will impose upon him be finally brought to the Commissioner of ity conferred. He seizes the property and he a mass of labor which, in my judgment, will Internal Revenue. No suit can be brought sells it. He proceeds to act as the executioner make it necessary to give him additional assistunder the existing law without his sanction. of his seizure, to judge and sell the property. ance more than the law now contemplates. It comes up before him usually, first
the As a matter of course the owner of the prop- Mr. MORTON. The law already provided assessment by the assessor, and then upon the erty has a right by proper proceedings to re. for the initiation of proceedings is very abun
. SHERMAN. As a matter of course, is he. SHERMAN. h i do 100 know a lihat it is
dant, as read by the Senator from Ohio; and cents a gallon as it did three or four years ago mittee on Finance to propose to strike out the it is so clear that I believe no two Senators on two dollars a gallon, and they can do it just words "the district attorney," in the twentieth agree as to what it means.
Mr. President, as as easily. And here they find us coming in, line of section one hundred and one, and all was remarked by the Senator from Ohio, there constructing a great big door of compromise, the words to the end of the section, and insert is not much use in discussing this law here. through which they can travel without jostling in lieu thereof “the Attorney General ;'' so Why?
each other, as they have done in times past. that in cases where suits have been commenced sir. SHERMAN. I did not say that.
Mr. MORRILL, of Vermont. Mr. Presi- and are pending the assent of the Attorney Mr. MORTON. “In discussing that ques- dent, I am as much in favor of closing the door | General shall be required to a compromise. tion here," I understood you to say.
against compromises as any Senator possibly Mr. WILLIAMS. I think that amendmen Mr. SHERMAN. I say it belongs to another can be; but it is indispensable that some party is objectionable notwithstanding it comes fron. stage of the bill. We are on the first reading | here in Washington should have the power of the chairman of the Committee on Finance. of the bill, and no amendments to it are now making compromises. As long as human na- I did not know that the committee had agreed in order except the amendments of the Com- ture is no purer than it is at the present day, to any such amendment. It seems to me that mittee on Finance.
there must be somebody to protect the honest the district attorney is the person who must Mr. MORTON. Perhaps this discussion is tax payer, or he will inevitably suffer if this necessarily have personal kuowledge of the just as proper here as anywhere else ; but a power is not given. For instance, suppose transaction, and he ought to be required to discussion as to what this law means is not that one of the officers either ignorantly or ma- recommend a discontinuance of a prosecution very important at any time. It is practically a liciously shall seize and confiscate the property before it is discontinued or compromised by dead letter, and it has been. You might almost of a tax payer ; if it is ignorantly done, say the Commissioner of Internal Revenue. The as profitably read from Robinson Crusoe or that it is a mere mistake of figures ; if it is ma- Attorney General has no knowledge of the Baron Munchausen. The whole system is a liciously, it is done for the purpose, say, of subject at all, and can have none whatever failure. There is the great truth about it-it | black-mail, of levying a contribution, or some- except what he derives from other officers. is a failure.
thing of that kind. When this comes to the The Commissioner of Internal Revenue has Now, Mr. President, let me refer once more knowledge of the officers here in Washington no knowledge on the subject except what he to the amendment offered by the Senator from there ought to be somewhere a power lodged derives from others; and so of the Secretary Illinois and that suggested by the Senator from for compromise.
of the Treasury. These officers here in WashiOhio. The Senator from Illinois proposes to But allow me to say to Senators who were so ington who are required to act, must necesthrow an additional safeguard around this com- earnest on this subject that all the fault is not sarily derive their intormation from the officers promise by having it finally referred to the here at the office of the Commissioner of Inter- | in the district where the suit is pending. I Attorney General. I will take the case of a nal Revenue. We have had positively no con- would not object to an amendment requiring compromise of an offense in a case where suit vietions in the last six months
the consent of the Attorney General, also, in has not been commenced. The parties come Mr. MORTON. Allow me to correct my addition to the district attorney; but to strike before the Commissioner of Internal Revenue friend from Vermont. I do not mean to say out the district attorney and substitute the and the Secretary of the Treasury, or the soli- that the fault is here. I said last winter, and Attorney General it seems to me would be citor of internal revenue, as the case may be. I say now, that the great power lodged in the rather unwise. They present an ex parte statement, one that is hands of district attorneys has been fatal to Mr. SHERMAN, I am not authorized by very strong on their side and not on the other. || prosecutions, because there have been no pros- the committee to accept such an amnendment, They succeed in getting a compromise with the ecutions.
but I have no objection personally to requiring Commissioner of Internal Revenue, and the Mr. MORRILL, of Vermont. The fault has the district attorney as well as the Attorney solicitor of internal revenue, not being any been chiefly with the district courts. We have General. My own opinion is, however, that better lawyer, perhaps, and not having half the several district judges who have so charged a district attorney ought not to have anything experience, they make out a case that is all that it was impossible that any jury should to do with the settlement of cases.
He is an fair on the face of it. It would perhaps satisfy | convict, and we have had in some places jurors interested party. His fees are somewhat couyou or me just by reading it; but bear in mind who were in the interest of the "whisky ring tingent on the number of cases he tries. As a it is an ex parte case. They submit that to the and would not convict.
matter of course the Attorney General would Secretary of the Treasury. "What time has he There is another reason. Congress itself is not consent to the settlement of cases without to go back to the original sources of informa
not entirely exempt from blame. The district some information from the district attorney, tion?. Here is their paper that is fair orrits face. attorneys are not paid sufficiently to attend to and I would rather just throw the responsibility He gives it his assent. Then they take it to these vumberless cases. They are paid in where .suits are pending on the Attorney the Attorney General, and the same paper, fair some instances not more than their mere travel- General. The preceding part of the section and unexceptionable on its face, making out a ing expenses, so that they are no better off provides that the Commissioner of Internal good case, receives his approval. What time
for attending to the cases than they would be Revenue must go through all these matters Has he to go to Cincinnati or St. Louis, or to if they stayed at home; and in some instances and make an arrangement, if that is deemed send out there and make original examinations I am told that they cannot attend to the cases
better than a suit; and then it goes on to proabout the case ? None at all. It is out of his and pay their board and traveling expenses
vide in addition that the assent of the district power to do so. He is bound to take the case without absolute loss. These things ought to attorney must be had to a compromise in cases as it is sent to him. be remedied by Congress.
where suits are pending. The district attorTherefore I say that the proposition to send All that I rose for, Mr. President, was to neys are sometimes men upon whom we can the case to him for revisal is a mere sham; it || protest against the idea which seemed to pre- not place entire reliability, and they are someis a humbug that amounts to nothing. And vail from the current of the debate that there what interested. They may have acquainttbus it is with the whole system. It is an ex
was great wrong and corruption here at Wash- ances who are interested. Their friends may parte system that is a sham from beginning to ington in relation to the compromise of cases. be the parties implicated. Now, the Attorney end. If you do not believe it, I ask you again I do not believe it. There may be some errors,
General is a responsible officer here, and he how it has worked ? Just go back to your some bluuders, some mistakes, and I am quite would act probably on information derived experience of nearly five years and ask your- ready to go for a restriction of the rule; but it from the district attorney. I am disposed, selt how it has worked. If men will not learn
ought to remain there to some, at least to a therefore, to require his sanction as the chief from experience they cannot learn from any moderate extent. If we find the courts all of the law department. I agree with the logic source. How has it worked? As it has worked
over the country, as they have done for the of the Senator from Illinois so far as suits are in the past so it will work in the future. And
past six months in New York and in Richmond concerned, but I would not burden him with yet, sir, here we are about to reënact the same and in one other place, so charging the juries the matter before suits are brought. It is, old folly, the same systein which has led to the
as to produce conviction, we shall have no however, for the Senate to say, great loss the Government bas sustained and
trouble in executing the laws and collecting Mr. HOWARD. I hope the amendment the almost universal escape of these great the revenue; but until we can do that, of
will be reported. criminals, some of whom, perhaps, are now, course we shall fail.
The Chief CLERK. It is proposed in section or very often are, sitting in our galleries, the The PRESIDENT pro tempore. The ques- one hundred and one to strike out, in lines finest gentlemen about the city, who have tion is on the amendment reported by the Com- twenty, twenty-one, twenty-two, and twentyrobbed the Government of millions and yet mittee on Finance to section one hundred and three, the words " district attorney for the have gone harmless from the law. They have
judicial district in which the suit or proceedsuffered no penalty but that of a compromise, The amendment was agreed to.
ing is pending, or of such other counsel as may and we are reënacting the same thing right over again.
The next amendment was, in lines eight, || be employed to conduct or prosecute the same Sir, if they can cheat the Government out nine, and ten of the section, to strike out the
on the part of the United States,'' and in lieu of two dollars on the gallon they can cheat it words “ whose opinion in the case, with the
thereotto insert “ Attorney General.” out of fifty cents on the gallon on the same reasons therefor, shall be given in writing and
Mr. CORBETT. I have drawn up an amenddelivered to the Commissioner."
ment which I suppose is not in order at this system. The temptation is not quite so great ; but they have now learned the business; all
The amendment was agreed to.
time, but I may state it for the inforination of
the Senate. I am opposed to striking out the the processes have been studied' out. It is The next amendment was in line twelve of
district attorney, but I propose, after the word not half the trouble now to get up a fraud that
the seotion, after the word "solicitor,'' to insert it was three years ago, because they know how " of interval revenue."
“pending,'' in line twenty-one, to insert “and
his statement under oath that in his opinion to do it. It is a trade; and it will pay them
The amendment was agreed to.
said case cannot be maintained in court. just as well to get up a fraud now on fifty Mr. SHERMAN. I am directed by the Com- Mr. HOWARD. Most of the cases that are
40TH CONG, 2D Sess.-- No. 237.
compromised must, of course, rest on the mere to time request opinions of him, and to the tion, corporation, or company may be located, or in facts of the case rather than upon the law; and President, and to try all the Government cases which such person has his place of business, with a I do not see what additional security the Gov
declaration annexed thereto, verified by the oath that may be in the Supreme Court either by
oraffirmation of such person, or of the president ernment gets from consulting the Attorney || appeal from the decisions of the Court of or cashier of such bank, auzociation, corporation, General. . I do not think we shall derive any Claims or from the several circuits.
or company in such form and manner as may be preadvantage at all from such a provision, for the It is very obvious that duties so extensive as
scribed by the Commissioner of Internal Revenue.
And for any refusal or neglect to make or to redvery reason that as the case must depend on these can be of themselves hardly adequately der such return and pay the tax, any such bank, the facts which are not within his kuowledge, discharged by any one man. They require not
association, corporation, company, or person so in his recommendation would amount to very only a high order of ability and great profes
default shall be subject to and pay a penalty of $200,
besides the additional penalty and forfeitures in little indeed. The great difficulty is to make sional knowledge, but they require the greatest other cases provided by law; and in default of such some provision for the settlement of cases of possible industry; they will take up nearly all return the several amounts subject to tax shall
be estimated by the assessor, or assistant assessor, on controversies as they happen to arise before the time any man can devote to them. Now,
the best information he can obtain. And in the case they are brought into court. I think that a it is proposed by this bill to cast upon him of banks with branches, each branch sball make a very dangerous practice. It cannot be denied duties that will very seriously increase his separate return, and the tax shall be assessed on each that it will necessarily open the door to great | labors, and duties which I think he is very untit
severally. And so much of the forty-first section of
the act to provide a national currency secured by temptation aud to frequent frauds on the part to discharge. He cannot know except through a pledge of United States bonds, and to provide for of the officers of the Government, for it is in the district attorney of the district where the the circulation and redemption thereof, approved effect almost holding out an invitation to per
June 3, 1861, as imposes a tax on the banks organized case may be pending, or through the Commis
under that act, and requires returns to be made to sons engaged in the administration of this law sioner of Internal Revenue, what the facts of the Treasurer of the United States, be, and is hereby, to get up cases against parties for the very pur- each case are; and when he is called upon to repealed : Provided, That the deposits in associations
or companies known as provident institutions, saypose of compromising them and making some- decide on statements made by those officers,
ings-banks, savings funds, or savings institutions, thing out of them and putting it into their own either individually or conjointly, it will very having no capital stock and doing no other business pockets. often happen that whether he is to dismiss the than receiving deposits to be loaned or invested for
tbe sole benefit of the parties making such deposits, I do not say that it is convenient, or even suit or not will depend upon how he may view the
without profit or compensation to the association or possible, perhaps, to frame a law which shall | facts in each case. Sometimes it may depend company, shall be exempt from tax on so much of be entirely free from such an objectionable upon his opinion of the law. In the execu- their deposits as they have invested in securities of provision; but I think we ought to be very tion of this internal revenue bill, I can imagine
the United States, and on all deposits less than $300
made in the name of any one person; and the returns strict about it, and to give no more discretion- that hundreds and hundreds of cases will be required to be made by such provident institutions ary authority to officers of the Government sent to him almost monthly that it will be
and savings banks shall be made on the first Monday than is absolutely necessary.
of January and July of each year, in such form and Where the line | impossible for him properly to attend to; and
manner as may be prescribed by the Cominissioner is to be drawn I really am not able myself to the result will be, unless he declines altogether of Internal Revenue. see just at this time, but I am clear in one for want of time, if he attends to them all,
SEC. 103. And be it further enacterl, That every thing, that I would not impose on the Attorney that he will take the statement of the district
national banking association, State bank, or State
banking association, corporation, company, or perGeneral this additional burden contemplated attorney or the Commissioner of Internal son engaged in the business banking, shall pay a by this amendment of the Senator froin Ohio. Revenue.
tax of ten per cent, on the amount of notes of any He cannot look into the subject as it ought to
person. State bank, or State banking association, or It is true, as stated by my friend from Indi
of any State, town, city, or other municipal corporabe examined because he has not the means ana, as I believe, that one of the difficulties tion, used for circulation and paid out by them, and of ascertaining the facts of the case, Where which we have had in connection with the rev- such tax shall be assessed and paid in such manner
as shall be prescribed by law, and by the Commisdo the facts come from? Where is the original enue under this particular tax has been a want sioner of Internal Revenue: Provided, That this proof, the original evidence upon which a com- of integrity on the part of some of the subordi- section shall not apply to banks, persons, or institupromise is to be made? It is presented in the nate officers, and perhaps that want of integrity
tions which are in liquidation and which have not
issued any notes for circulation for a period of more Arst instance ordinarily by the officers of the may have been found in some of the district
than one year. revenue to the district attorney: The district attorneys. We cannot expect to find integrity
The amendment was agreed to. attorney is first informed by the informers what in all the multitude of officers the United States the facts are in regard to a particular case, have. That would be almost a chimerical hope.
Section one hundred and four, now become He derives his information from them; and | But we must trust the officers; and the only
one hundred and two, to which no amendment if afterward he undertakes to make any recom- safeguard that we have against suffering from
was proposed, was read, as follows: mendation in the case, his recommendation their want of integrity is to be found, I think,
SEC. (194) 102. And be it further enacted, That when must of course rest entirely on the veracity || in punishing them
criminally. Make it a crim
any tax is imposed, and the mode or time of assess;
ment or collection is not provided for, the same shall and reliability of his informers. These in inal offense for a district attorney to settle a be established by regulation of the Commissioner of formers in many cases, not to say in most cases, case wrongfully, and knowing that it is wrong
Internal Revenue; and the Commissioner is author
ized to make all such regulations, not otherwise prowe all know to be men upon whose veracity | ful, and he will, perhaps, very seldom be found
vided for, as may become necessary by reason of any the world is not very generally willing to rely, to commit that wrong.
change of law in relation to internal revenue made I think myself, if it were practicable, it would But what I rose for was merely for the pur.
by this act. be safer for the Government in all cases to pose of saying that the bill, by the amendment Section [one hundred and five] one hundred permit no compromise unless a suit had been proposed by the honorable chairman in behalf and three was next read, as follows: actually brought in court and the pleadings of the committee, will so add to the labors of Sec. (105) 103. And be it further enacted, That where put in, and something like the facts of the case the Attorney General that it will be impossible
not otherwise distinctly expressed or manifestly developed before the public. After that, if for him properly to discharge them.
incompatible with the intent thereof, the word "per
as used in this act, shall be construed to mean the case should present peculiar grounds of The amendment was agreed to.
and include a firm, partnership, association, comhardship to the accused, so frame your bill The Committee on Finance proposed to
pany, or corporation, as well as a natural person; that the facts may be made public, may be
and words of the masculine gender, as applied to made known, and somebody held responsible || dred and two and one hundred and three, amend the bill by striking out sections one hun- persons, to mean and include the feminine gender;
and the singular number to mean and include the for the compromise made. which are as follows:
plural number; and the word "State" to mean and As a question of principle, Mr. President, I
include a Territory and District of Columbia ; and Banks and Bankers.
the word "county, to mean and include parish, discertainly should be in favor of such a provision,
Sec. 102. And be it further enacted, That there shall
trict, or other equivalent territorial subdivision of a and in favor of excluding from the law this be levied, collected, and paid a tax of one twelfth of
State. discretionary authority to settle controversies one per cent. each month upon the average amount Section [one hundred and six] one hundred before they have been brought into court.
of the deposits of money, other than public money
and four was next read, as follows: There is the point of difficulty in this whole or draft, or represented by certificates of deposit or Sec.  104. And be it further enacted, That all acts case, that it is to be done privately, secretly,
otherwise, whether payable on demand or at some and parts of acts inconsistent with the provisions of when the eyes of the world are not upon it,
future day, with any person, bank, association, com- this act are hereby repealed: Provided, That all the
pany, or corporation engaged in the business of bank- provisions of said acts shall be in force for levying when it is impossible for the public really, ing, and a tax of one fourth of one per cent. each and collecting all taxes properly assessed or liable to in most cases I mean, to ascertain what the month on the average amountof all deposits of public be assessed, or aceruing under the provisions of real nature of the case is.
money in their possession to the credit of the Treas- former acts, the right to which has already accrued
urer or any disbursing officer of the United States; or may hereafter accrue under said acts, and for mainMr.JOHNSON. Mr. President, the Senate and a tax of one twenty-fourth of one per cent. each taining and continuing liens, fines, penalties, and has passed at this session-I am not sure month, as aforesaid, upon the capital of any bank, forfeitures incurred under and by virtue thereof. whether the House of Representatives have
association, company, or corporation engaged in the And for carrying out and completing all proceedings
business of banking, and on the capital employed which have been already commenced or that may bo concurred in it or not-a bill abolishing the by any person in the business of banking, beyond the commenced to enforco such fines, penalties, and forsolicitors of the Court of Claims and providing average amountinvested in United States bonds; and feitures, or criminal proceedings under said acts, for the appointment of two Assistant Attorneys
a tax of one sixth;of one per cent. each month upon and for the punishment of crimes of which any party the average amount of circulation issued by any bank, shall
be or has been found guilty: And provider lurGeneral, and casting upon these officers the association, corporation, company, or person, includ- ther, That no office created by the said acts and conduty of attending to suits in that court. It is ing as circulation all certified checks and all notes tinued by this act shall be vacated by reason of any very doubtful whether those two can properly
and other obligations calculated or intended to cir- provisions herein contained, but the officers hereto
çulate or to be used as money, but not including that fore appointed shall continue to hold the said otfices discharge that duty, for there are some thou- in the vault of the bank, or redeemed and on deposit without reappointineut until their successors, or other sand or more of cases in that court; and the for said bank. And a true and accurate return of the officers to perform their duties, respectively, shall be result of the measure will be to leave the
amount of circulation, of deposit, and of capital, as appointed as provided in this act: And provided fur
aforesaid, and of the amount of notes of persons, ther, That whenever the duty imposed by any existAttorney General alone to attend to the busi- State banks and State banking associations, and of ing law shall cease in consequence of any limitation ness proper of his office as it exists under States, cities, towns, or other municipal corporations, therein contained before the respectivo provisions present laws, which is to give opinions to all
paid out by them for the previous month, shall bo of this act shall take effect, the same duty or tax
made and rendered monthly by each of them to the shall be, and is hereby, continued until such provisthe heads of Departments that may from time assessor of the district in which such bank, associa- ions of this act shall take effeot; and where any act
is hereby repealed, no duty or tax iunposed thereby “provided," in line twenty. The words to be ment striking out fifty cents and inserting two shall be held to cease in consequonc of such repeal, stricken out are:
dollars as the tax on whisky per gallon. until the respective corresponding provisions of this act shall take effect.
And, in like manner and under like restrictions
Mr. SHERMAN. I am not quite through and provisions, there shall be ascertained, recorded, with the amendments of the Finance ComMr. SHERMAN. I move to amend that and reported, the capacity of every ostablishment
mittee. section by striking out the word "and" be.
now existing, or that may be hereafter commenced,
Mr. CAMERON. Then I give way for the fore "continuing," in the eighth line, and by
present. inserting after the word “continuivg'' the
The amendment was agreed to.
Mr. SHERMAN. On page 85, in lines words "and enforcing."
Mr. SHERMAN. On page 15, after the
seven and eight of section sixty-one, I move The amendment was agreed to. words "carried on," in line nine of section
to strike out the words “ except snuff, which Mr. SHERMAN. I move further to amend | twelve, I move to insert “nor within six hun
may, at the option of the manufacturers, be the section by striking out lines ten, eleven, dred feet from premises authorized to be used
put up'' and insert"
The amendment was agreed to.
Mr. SHERMAN. In line seventeen of secings which have been already commenced or that Mr. SHERMAN. On page 19, before the may be commenced to enforce such fines, penalties,
tion sixty-one, on page 86, I move to strike and forfeitures, or criminal proceedings under said word "spirits,” in line eighteen of section
can be'' and insert "has.' acts, and for the punishment of crimes of which any sixteen, I move to insert "low wines or."
The amendment was agreed to. party shall be or has been found guilty.
The amendment was agreed to.
Mr. SHERMAN. In lines six and seven And inserting in lieu thereof:
Mr. SHERMAN. After the word "conBut this act shall not be construed to affect any denser,” in the next line, I move to insert,
of section sixty-seven, on page 93, I move to act done, right accrued, or penalty incurred under "back' to the still or doubler, or forward.''
strike out the words, “the manufacturer's former acts and every such right is hereby saved ; The amendment was agreed to.
name and." and all suits and prosecutions for acts already done
The amendment was agreed to. in violation of any former act or acts of Congress Mr. SHERMAN. On page 30, section relating to the subjects embraced in this act may be
Mr. SHERMAN. In section eighty-nine, commenced and proceeded with in like manner as
twenty-three, I move to strike out, in lines four if this act had not been passed. and five, the words, and shall be immediately
line four, page 114, I move to strike out" con The amendment was agreed to. removed into the distillery warehouse;'' at the
clusive" before "evidence'' and insert" prima end of line five to strike out the word '"and ;"
facie." The Chief Clerk read the following amend.
The amendment was agreed to. ment reported by the Committee on Finance,
and after the word "proved,” in line six, to to be added to the bill as section one hundred insert "and marked," so as to make the sec.
Mr. SHERMAN. I offer an amendinent tion read :
now to come in at the end of the bill: and five:
That all distilled spirits shall be drawn from the
And be it further enacted, That all provisions of Sec. 105. And be it further enacted, That in any caso receiving cisterns into casks, each of not less capacity
this act which requires any use of revenuo stamps where there has been a refusal or neglect to pay any than twenty gallons wino measure, and shall there
for denoting the tax thereby imposed, shall take tax imposed by the internal revenue laws, and where
effect at the end of sixty days from the passage of it is lawful and has become necessary to seize and upon be gauged, proved, and marked by an internal
this act: Provided, That if at any time prior to the revenue gauger, &c. sell real estate to satisfy the tax, the Commissioner
expiration of the said sixty days it shall be shown of Internal Revenue may, if he deems it expedient,
The amendment was agreed to.
to the satisfaction of the Secretary of the Treasury direct that a bill in chancery be filed, in a district or Mr. SHERMAN. In line ten of the same
that a longer delay is necessary for the preparation circuit court of the United States, to enforce the lien
and due delivery of any such stamps, he shall be of the United States for tax upon any real estate, or
section, after the word “shall," I move to authorized to fix a day not later than the 1st day to subject any real estate owned by the delinquent, insert " be immediately removed into the dis- of December next for putting said provisions, relaor in which he has any right, title, or interest, to the
tive to the use of either of such stamps into operapayment of such tax. And all persons having liens tillery warehouse, and the gauger shall."
tion, and shall give public notice of the day so fixed upon the real estate sought to be subjected to the
The amendment was agreed to.
and determined upon, which day shall then be held payment of any tax as aforesaid, or claiming any
Mr. SHERMAN. On page 39, in lines nine
and taken to be the time when that portion of this ownership or interest therein, shall be made parties
act which requires the use of revenue stamps for to such proceedings, and shall be brought into court
teen and twenty of section twenty-eight, I move denoting the tax thereby imposed, shall have effect. as provided in other suits in chancery in said courts. to strike out the words“ on all money ac- The amendment was agreed to. And the said courts shall have, and are hereby given, jurisdiction in all such cases, and shall, at the term counted for by him for tax collected on dis.
Mr. SHERMAN. next after such time as the parties shall be duly notitilled spirits.
Now, I believe, all the fied of the proceedings, unless otherwise ordered by
amendments of the committee bave been acted
The amendment was agreed to. the court, proceed to adjudicate all matters involved
on except those on pages 59 and 60 to section therein, and to pass upon and finally determine the
Mr. SHERMAN. On page 49, in line two fifty, which were passed over informally last merits of all claims to and liens upon the real estate of section forty-two, after the word “distill
night. I ask that they be acted on. in question, and shall, in all cases where a claim or interest of the United States therein shall be estab
ery," I move to insert "nor distilling appa- The PRESIDENT pro tempore. The amend. Jished, decree a sale, by the proper officer of the
ments to the fiftieth section which were passed court, of such real estate, and a distribution of the The amendment was agreed to. proceeds of such sale according to the findings of the
over will now be considered. court in respect to the interests of the parties and of
Mr. SHERMAN. On page 56, in line The Chief CLERK. The Committee on the United States.
twenty of section forty-eight, I move to insert Finance propose to insert as part of section The amendment was agreed to.
the words and sold," after manufactured;": fifty before the word “ that:" The next amendinent was to insert :
and in the same line, after the words “put up," That the Commissioner of Internal Revenue shall to insert and sold."
have power, whenever in bis judgment the necessiSEC. 106. And be it further enacted, That the internal revenue laws imposing taxes on distilled spirits,
The amendment was agreed to.
ties of the service may require, to employ competent
persons, not exceeding fifty in number at any one fermented liquors, tobacco, snuff, and cigars, shali Mr. SHERMAN. On page 73, at the end
time, whose term of service shall continue at the be held and construed to extend to such articles
pleasure of the Commissioner of Internal Revenue, produced anywhere within the exterior boundaries
of section fifty-five, I propose to insert: who shall perform such duties and at such places as of the United States, whether the same shall be And whenever in the opinion of the Commissioner may be required of them by the Commissioner of within a collection district or not.
of Internal Revenue any distillery or other ware- Internal Revenue, at a rate of compensation to be The amendment was agreed to.
house shall become unsafe or unfit for use, or the determined by the said Commissioner before the
merchandise therein shall for any reason be liable to commencement of his employment. Mr. SHERMAN. I have several amend- loss or great wastage, the Commissioner may discon
Mr. FESSENDEN. I have been looking at ments to propose now, mostly of a verbal
tinue such warehouse, and require that the iner-
that amendment and the other amendments in character that are not printed. In line five warehouse as may be designated by him within such that section, and my opinion is that to adopt of section three, on page 4, I move to strike time as he shall prescribe. Such transfer shall be
the amendment will be injurious. It is a out the word “or” before “starch," and after
made under the supervision of the collector, or such
other officer as may be designated by the Commis- change from the provision made by the House "starch" to insert "molasses."
sioner; and the expense thereof shall be paid by the of Representatives, which, I think, is much The amendment was agreed to. owner of such merchandise; and if the owner of such
better. To understand it you will have to look merchandise shall fail to make such transfer within Mr. SHERMAN. On page 9, after the word the time prescribed, or to pay the just and proper
back a little. The House provided in the business," in line three of section seven, I expense of such transfer, as ascertained and determ- preceding section, on page 57: move to insert "after the passage of this act
ined by the Commissioner, such merchandise may be
That the Secretary of the Treasury, on the recomand on the 1st day of May of each succeeding as goods are sold upon distraint for taxes, and the
mendation of the Commissioner of Internal Revenue, proceeds of such sale shall be applied to the payment
shall appoint one officer for each United States judiThe amendment was agreed to. of the tax due thereon and the costs and expenses of
cial district to be called a supervisor of internal revesuch sale and removal, and the balance paid over to
nue on distilled spirits and tobacco, whoso duty Mr. SHERMAN. On page 11, in line thirty.
it shall be to reside in such district and keep his the owner of such merchandise.
office, &c. four of section eight, before the word "con. The amendment was agreed to.
The Committee on Finance have changed ditioned," I move to insert " such bonds shall Mr. SHERMAN. On page 79 I move to that, and I think have changed that section for
strike out the clause which has been agreed to The amendment was agreed to.
the better. Instead of confining it to supervis. in regard to retail liquor dealers, and substi
ors of distilled spirits and tobacco in each Mr. SHERMAN. In line twelve of section tute for it the following:
judicial district, they have provided for the seven, line ten of section eight, and line thirty. Retail dealers in liquors shall pay twonty-five dol- appointment of a specified number of general seven of section eight, I move in each case to lars. Every person who shall sell or offer for sale
supervisors of internal revenue. It ig quite strike out the words - this act” and inscrt
foreign or domestic spirits, wines, ale, beer, or other
sales of other merchandise, do not exceed twenty-five distilled spirits and tobacco in every judicial The amendment was agreed to.
dollars, shall be regarded as a retail dealer in liquors. district, for there are many judicial districts in Mr. SHERMAN. On page 13, I move to
The amendment was agreed to:
the United States where no spirits are distilled, strike out all of section ter after the word Mr. CAMERON. I desire to offer an amend. and no tobacco grown. Therefore that pro