Chapter XXXI
The suspension of the banking house of Frank A. Cowperwood & Co. created a great stir on ’change and in Philadelphia generally. It was so unexpected, and the amount involved was comparatively so large. Actually he failed for one million two hundred and fifty thousand dollars; and his assets, under the depressed condition of stock values, barely totaled seven hundred and fifty thousand dollars. There had been considerable work done on the matter of his balance-sheet before it was finally given to the public; but when it was, stocks dropped an additional three points generally, and the papers the next day devoted notable headlines to it. Cowperwood had no idea of failing permanently; he merely wished to suspend temporarily, and later, if possible, to persuade his creditors to allow him to resume. There were only two things which stood in the way of this: the matter of the five hundred thousand dollars borrowed from the city treasury at a ridiculously low rate of interest, which showed plainer than words what had been going on, and the other, the matter of the sixty-thousand-dollar check. His financial wit had told him there were ways to assign his holdings in favor of his largest creditors, which would tend to help him later to resume; and he had been swift to act. Indeed, Harper Steger had drawn up documents which named Jay Cooke & Co., Edward Clark & Co., Drexel & Co., and others as preferred. He knew that even though dissatisfied holders of smaller shares in his company brought suit and compelled readjustment or bankruptcy later, the intention shown to prefer some of his most influential aids was important. They would like it, and might help him later when all this was over. Besides, suits in plenty are an excellent way of tiding over a crisis of this kind until stocks and common sense are restored, and he was for many suits. Harper Steger smiled once rather grimly, even in the whirl of the financial chaos where smiles were few, as they were figuring it out.
“Frank,” he said, “you’re a wonder. You’ll have a network of suits spread here shortly, which no one can break through. They’ll all be suing each other.”
Cowperwood smiled.
“I only want a little time, that’s all,” he replied. Nevertheless, for the first time in his life he was a little depressed; for now this business, to which he had devoted years of active work and thought, was ended.
The thing that was troubling him most in all of this was not the five hundred thousand dollars which was owing the city treasury, and which he knew would stir political and social life to the center once it was generally known—that was a legal or semi-legal transaction, at least—but rather the matter of the sixty thousand dollars’ worth of unrestored city loan certificates which he had not been able to replace in the sinking-fund and could not now even though the necessary money should fall from heaven. The fact of their absence was a matter of source. He pondered over the situation a good deal. The thing to do, he thought, if he went to Mollenhauer or Simpson, or both (he had never met either of them, but in view of Butler’s desertion they were his only recourse), was to say that, although he could not at present return the five hundred thousand dollars, if no action were taken against him now, which would prevent his resuming his business on a normal scale a little later, he would pledge his word that every dollar of the involved five hundred thousand dollars would eventually be returned to the treasury. If they refused, and injury was done him, he proposed to let them wait until he was “good and ready,” which in all probability would be never. But, really, it was not quite clear how action against him was to be prevented—even by them. The money was down on his books as owing the city treasury, and it was down on the city treasury’s books as owing from him. Besides, there was a local organization known as the Citizens’ Municipal Reform Association which occasionally conducted investigations in connection with public affairs. His defalcation would be sure to come to the ears of this body and a public investigation might well follow. Various private individuals knew of it already. His creditors, for instance, who were now examining his books.
This matter of seeing Mollenhauer or Simpson, or both, was important, anyhow, he thought; but before doing so he decided to talk it all over with Harper Steger. So several days after he had closed his doors, he sent for Steger and told him all about the transaction, except that he did not make it clear that he had not intended to put the certificates in the sinking-fund unless he survived quite comfortably.
Harper Steger was a tall, thin, graceful, rather elegant man, of gentle voice and perfect manners, who walked always as though he were a cat, and a dog were prowling somewhere in the offing. He had a longish, thin face of a type that is rather attractive to women. His eyes were blue, his hair brown, with a suggestion of sandy red in it. He had a steady, inscrutable gaze which sometimes came to you over a thin, delicate hand, which he laid meditatively over his mouth. He was cruel to the limit of the word, not aggressively but indifferently; for he had no faith in anything. He was not poor. He had not even been born poor. He was just innately subtle, with the rather constructive thought, which was about the only thing that compelled him to work, that he ought to be richer than he was—more conspicuous. Cowperwood was an excellent avenue toward legal prosperity. Besides, he was a fascinating customer. Of all his clients, Steger admired Cowperwood most.
“Let them proceed against you,” he said on this occasion, his brilliant legal mind taking in all the phases of the situation at once. “I don’t see that there is anything more here than a technical charge. If it ever came to anything like that, which I don’t think it will, the charge would be embezzlement or perhaps larceny as bailee. In this instance, you were the bailee. And the only way out of that would be to swear that you had received the check with Stener’s knowledge and consent. Then it would only be a technical charge of irresponsibility on your part, as I see it, and I don’t believe any jury would convict you on the evidence of how this relationship was conducted. Still, it might; you never can tell what a jury is going to do. All this would have to come out at a trial, however. The whole thing, it seems to me, would depend on which of you two—yourself or Stener—the jury would be inclined to believe, and on how anxious this city crowd is to find a scapegoat for Stener. This coming election is the rub. If this panic had come at any other time—”
Cowperwood waved for silence. He knew all about that. “It all depends on what the politicians decide to do. I’m doubtful. The situation is too complicated. It can’t be hushed up.” They were in his private office at his house. “What will be will be,” he added.
“What would that mean, Harper, legally, if I were tried on a charge of larceny as bailee, as you put it, and convicted? How many years in the penitentiary at the outside?”
Steger thought a minute, rubbing his chin with his hand. “Let me see,” he said, “that is a serious question, isn’t it? The law says one to five years at the outside; but the sentences usually average from one to three years in embezzlement cases. Of course, in this case—”
“I know all about that,” interrupted Cowperwood, irritably. “My case isn’t any different from the others, and you know it. Embezzlement is embezzlement if the politicians want to have it so.” He fell to thinking, and Steger got up and strolled about leisurely. He was thinking also.
“And would I have to go to jail at any time during the proceedings—before a final adjustment of the case by the higher courts?” Cowperwood added, directly, grimly, after a time.
“Yes, there is one point in all legal procedure of the kind,” replied Steger, cautiously, now rubbing his ear and trying to put the matter as delicately as possible. “You can avoid jail sentences all through the earlier parts of a case like this; but if you are once tried and convicted it’s pretty hard to do anything—as a matter of fact, it becomes absolutely necessary then to go to jail for a few days, five or so, pending the motion for a new trial and the obtaining of a certificate of reasonable doubt. It usually takes that long.”
The young banker sat there staring out of the window, and Steger observed, “It is a bit complicated, isn’t it?”
“Well, I should say so,” returned Frank, and he added to himself: “Jail! Five days in prison!” That would be a terrific slap, all things considered. Five days in jail pending the obtaining of a certificate of reasonable doubt, if one could be obtained! He must avoid this! Jail! The penitentiary! His commercial reputation would never survive that.
Chapter XXXII
The necessity of a final conference between Butler, Mollenhauer, and Simpson was speedily reached, for this situation was hourly growing more serious. Rumors were floating about in Third Street that in addition to having failed for so large an amount as to have further unsettled the already panicky financial situation induced by the Chicago fire, Cowperwood and Stener, or Stener working with Cowperwood, or the other way round, had involved the city treasury to the extent of five hundred thousand dollars. And the question was how was the matter to be kept quiet until after election, which was still three weeks away. Bankers and brokers were communicating odd rumors to each other about a check that had been taken from the city treasury after Cowperwood knew he was to fail, and without Stener’s consent. Also that there was danger that it would come to the ears of that very uncomfortable political organization known as the Citizens’ Municipal Reform Association, of which a well-known iron-manufacturer of great probity and moral rectitude, one Skelton C. Wheat, was president. Wheat had for years been following on the trail of the dominant Republican administration in a vain attempt to bring it to a sense of some of its political iniquities. He was a serious and austere man—-one of those solemn, self-righteous souls who see life through a peculiar veil of duty, and who, undisturbed by notable animal passions of any kind, go their way of upholding the theory of the Ten Commandments over the order of things as they are.
The committee in question had originally been organized to protest against some abuses in the tax department; but since then, from election to election, it had been drifting from one subject to another, finding an occasional evidence of its worthwhileness in some newspaper comment and the frightened reformation of some minor political official who ended, usually, by taking refuge behind the skirts of some higher political power—in the last reaches, Messrs. Butler, Mollenhauer, and Simpson. Just now it was without important fuel or ammunition; and this assignment of Cowperwood, with its attendant crime, so far as the city treasury was concerned, threatened, as some politicians and bankers saw it, to give it just the club it was looking for.
However, the decisive conference took place between Cowperwood and the reigning political powers some five days after Cowperwood’s failure, at the home of Senator Simpson, which was located in Rittenhouse Square—a region central for the older order of wealth in Philadelphia. Simpson was a man of no little refinement artistically, of Quaker extraction, and of great wealth-breeding judgment which he used largely to satisfy his craving for political predominance. He was most liberal where money would bring him a powerful or necessary political adherent. He fairly showered offices—commissionerships, trusteeships, judgeships, political nominations, and executive positions generally—on those who did his bidding faithfully and without question. Compared with Butler and Mollenhauer he was more powerful than either, for he represented the State and the nation. When the political authorities who were trying to swing a national election were anxious to discover what the State of Pennsylvania would do, so far as the Republican party was concerned, it was to Senator Simpson that they appealed. In the literal sense of the word, he knew. The Senator had long since graduated from State to national politics, and was an interesting figure in the United States Senate at Washington, where his voice in all the conservative and moneyed councils of the nation was of great weight.
The house that he occupied, of Venetian design, and four stories in height, bore many architectural marks of distinction, such as the floriated window, the door with the semipointed arch, and medallions of colored marble set in the walls. The Senator was a great admirer of Venice. He had been there often, as he had to Athens and Rome, and had brought back many artistic objects representative of the civilizations and refinements of older days. He was fond, for one thing, of the stern, sculptured heads of the Roman emperors, and the fragments of gods and goddesses which are the best testimony of the artistic aspirations of Greece. In the entresol of this house was one of his finest treasures—a carved and floriated base bearing a tapering monolith some four feet high, crowned by the head of a peculiarly goatish Pan, by the side of which were the problematic remains of a lovely nude nymph—just the little feet broken off at the ankles. The base on which the feet of the nymph and the monolith stood was ornamented with carved ox-skulls intertwined with roses. In his reception hall were replicas of Caligula, Nero, and other Roman emperors; and on his stair-walls reliefs of dancing nymphs in procession, and priests bearing offerings of sheep and swine to the sacrificial altars. There was a clock in some corner of the house which chimed the quarter, the half, the three-quarters, and the hour in strange, euphonious, and pathetic notes. On the walls of the rooms were tapestries of Flemish origin, and in the reception-hall, the library, the living-room, and the drawing-room, richly carved furniture after the standards of the Italian Renaissance. The Senator’s taste in the matter of paintings was inadequate, and he mistrusted it; but such as he had were of distinguished origin and authentic. He cared more for his curio-cases filled with smaller imported bronzes, Venetian glass, and Chinese jade. He was not a collector of these in any notable sense—merely a lover of a few choice examples. Handsome tiger and leopard skin rugs, the fur of a musk-ox for his divan, and tanned and brown-stained goat and kid skins for his tables, gave a sense of elegance and reserved profusion. In addition the Senator had a dining-room done after the Jacobean idea of artistic excellence, and a wine-cellar which the best of the local vintners looked after with extreme care. He was a man who loved to entertain lavishly; and when his residence was thrown open for a dinner, a reception, or a ball, the best of local society was to be found there.
The conference was in the Senator’s library, and he received his colleagues with the genial air of one who has much to gain and little to lose. There were whiskies, wines, cigars on the table, and while Mollenhauer and Simpson exchanged the commonplaces of the day awaiting the arrival of Butler, they lighted cigars and kept their inmost thoughts to themselves.
It so happened that upon the previous afternoon Butler had learned from Mr. David Pettie, the district attorney, of the sixty-thousand-dollar-check transaction. At the same time the matter had been brought to Mollenhauer’s attention by Stener himself. It was Mollenhauer, not Butler who saw that by taking advantage of Cowperwood’s situation, he might save the local party from blame, and at the same time most likely fleece Cowperwood out of his street-railway shares without letting Butler or Simpson know anything about it. The thing to do was to terrorize him with a private threat of prosecution.
Butler was not long in arriving, and apologized for the delay. Concealing his recent grief behind as jaunty an air as possible, he began with:
“It’s a lively life I’m leadin’, what with every bank in the city wantin’ to know how their loans are goin’ to be taken care of.” He took a cigar and struck a match.
“It does look a little threatening,” said Senator Simpson, smiling. “Sit down. I have just been talking with Avery Stone, of Jay Cooke & Company, and he tells me that the talk in Third Street about Stener’s connection with this Cowperwood failure is growing very strong, and that the newspapers are bound to take up the matter shortly, unless something is done about it. I am sure that the news will also reach Mr. Wheat, of the Citizens’ Reform Association, very shortly. We ought to decide now, gentlemen, what we propose to do. One thing, I am sure, is to eliminate Stener from the ticket as quietly as possible. This really looks to me as if it might become a very serious issue, and we ought to be doing what we can now to offset its effect later.”
Mollenhauer pulled a long breath through his cigar, and blew it out in a rolling steel-blue cloud. He studied the tapestry on the opposite wall but said nothing.
“There is one thing sure,” continued Senator Simpson, after a time, seeing that no one else spoke, “and that is, if we do not begin a prosecution on our own account within a reasonable time, some one else is apt to; and that would put rather a bad face on the matter. My own opinion would be that we wait until it is very plain that prosecution is going to be undertaken by some one else—possibly the Municipal Reform Association—but that we stand ready to step in and act in such a way as to make it look as though we had been planning to do it all the time. The thing to do is to gain time; and so I would suggest that it be made as difficult as possible to get at the treasurer’s books. An investigation there, if it begins at all—as I think is very likely—should be very slow in producing the facts.”
The Senator was not at all for mincing words with his important confreres, when it came to vital issues. He preferred, in his grandiloquent way, to call a spade a spade.
“Now that sounds like very good sense to me,” said Butler, sinking a little lower in his chair for comfort’s sake, and concealing his true mood in regard to all this. “The boys could easily make that investigation last three weeks, I should think. They’re slow enough with everything else, if me memory doesn’t fail me.” At the same time he was cogitating as to how to inject the personality of Cowperwood and his speedy prosecution without appearing to be neglecting the general welfare of the local party too much.
“Yes, that isn’t a bad idea,” said Mollenhauer, solemnly, blowing a ring of smoke, and thinking how to keep Cowperwood’s especial offense from coming up at this conference and until after he had seen him.
“We ought to map out our program very carefully,” continued Senator Simpson, “so that if we are compelled to act we can do so very quickly. I believe myself that this thing is certain to come to an issue within a week, if not sooner, and we have no time to lose. If my advice were followed now, I should have the mayor write the treasurer a letter asking for information, and the treasurer write the mayor his answer, and also have the mayor, with the authority of the common council, suspend the treasurer for the time being—I think we have the authority to do that—or, at least, take over his principal duties but without for the time being, anyhow, making any of these transactions public—until we have to, of course. We ought to be ready with these letters to show to the newspapers at once, in case this action is forced upon us.”
“I could have those letters prepared, if you gentlemen have no objection,” put in Mollenhauer, quietly, but quickly.
“Well, that strikes me as sinsible,” said Butler, easily. “It’s about the only thing we can do under the circumstances, unless we could find some one else to blame it on, and I have a suggestion to make in that direction. Maybe we’re not as helpless as we might be, all things considered.”
There was a slight gleam of triumph in his eye as he said this, at the same time that there was a slight shadow of disappointment in Mollenhauer’s. So Butler knew, and probably Simpson, too.
“Just what do you mean?” asked the Senator, looking at Butler interestedly. He knew nothing of the sixty-thousand-dollar check transaction. He had not followed the local treasury dealings very closely, nor had he talked to either of his confreres since the original conference between them. “There haven’t been any outside parties mixed up with this, have there?” His own shrewd, political mind was working.
“No-o. I wouldn’t call him an outside party, exactly, Senator,” went on Butler suavely. “It’s Cowperwood himself I’m thinkin’ of. There’s somethin’ that has come up since I saw you gentlemen last that makes me think that perhaps that young man isn’t as innocent as he might be. It looks to me as though he was the ringleader in this business, as though he had been leadin’ Stener on against his will. I’ve been lookin’ into the matter on me own account, and as far as I can make out this man Stener isn’t as much to blame as I thought. From all I can learn, Cowperwood’s been threatenin’ Stener with one thing and another if he didn’t give him more money, and only the other day he got a big sum on false pretinses, which might make him equally guilty with Stener. There’s sixty-thousand dollars of city loan certificates that has been paid for that aren’t in the sinking-fund. And since the reputation of the party’s in danger this fall, I don’t see that we need to have any particular consideration for him.” He paused, strong in the conviction that he had sent a most dangerous arrow flying in the direction of Cowperwood, as indeed he had. Yet at this moment, both the Senator and Mollenhauer were not a little surprised, seeing at their last meeting he had appeared rather friendly to the young banker, and this recent discovery seemed scarcely any occasion for a vicious attitude on his part. Mollenhauer in particular was surprised, for he had been looking on Butler’s friendship for Cowperwood as a possible stumbling block.
“Um-m, you don’t tell me,” observed Senator Simpson, thoughtfully, stroking his mouth with his pale hand.
“Yes, I can confirm that,” said Mollenhauer, quietly, seeing his own little private plan of browbeating Cowperwood out of his street-railway shares going glimmering. “I had a talk with Stener the other day about this very matter, and he told me that Cowperwood had been trying to force him to give him three hundred thousand dollars more, and that when he refused Cowperwood managed to get sixty thousand dollars further without his knowledge or consent.”
“How could he do that?” asked Senator Simpson, incredulously. Mollenhauer explained the transaction.
“Oh,” said the Senator, when Mollenhauer had finished, “that indicates a rather sharp person, doesn’t it? And the certificates are not in the sinking-fund, eh?”
“They’re not,” chimed in Butler, with considerable enthusiasm.
“Well, I must say,” said Simpson, rather relieved in his manner, “this looks like a rather good thing than not to me. A scapegoat possibly. We need something like this. I see no reason under the circumstances for trying to protect Mr. Cowperwood. We might as well try to make a point of that, if we have to. The newspapers might just as well talk loud about that as anything else. They are bound to talk; and if we give them the right angle, I think that the election might well come and go before the matter could be reasonably cleared up, even though Mr. Wheat does interfere. I will be glad to undertake to see what can be done with the papers.”
“Well, that bein’ the case,” said Butler, “I don’t see that there’s so much more we can do now; but I do think it will be a mistake if Cowperwood isn’t punished with the other one. He’s equally guilty with Stener, if not more so, and I for one want to see him get what he deserves. He belongs in the penitentiary, and that’s where he’ll go if I have my say.” Both Mollenhauer and Simpson turned a reserved and inquiring eye on their usually genial associate. What could be the reason for his sudden determination to have Cowperwood punished? Cowperwood, as Mollenhauer and Simpson saw it, and as Butler would ordinarily have seen it, was well within his human, if not his strictly legal rights. They did not blame him half as much for trying to do what he had done as they blamed Stener for letting him do it. But, since Butler felt as he did, and there was an actual technical crime here, they were perfectly willing that the party should have the advantage of it, even if Cowperwood went to the penitentiary.
“You may be right,” said Senator Simpson, cautiously. “You might have those letters prepared, Henry; and if we have to bring any action at all against anybody before election, it would, perhaps, be advisable to bring it against Cowperwood. Include Stener if you have to but not unless you have to. I leave it to you two, as I am compelled to start for Pittsburg next Friday; but I know you will not overlook any point.”
The Senator arose. His time was always valuable. Butler was highly gratified by what he had accomplished. He had succeeded in putting the triumvirate on record against Cowperwood as the first victim, in case of any public disturbance or demonstration against the party. All that was now necessary was for that disturbance to manifest itself; and, from what he could see of local conditions, it was not far off. There was now the matter of Cowperwood’s disgruntled creditors to look into; and if by buying in these he should succeed in preventing the financier from resuming business, he would have him in a very precarious condition indeed. It was a sad day for Cowperwood, Butler thought—the day he had first tried to lead Aileen astray—and the time was not far off when he could prove it to him.
Chapter XXXIII
In the meantime Cowperwood, from what he could see and hear, was becoming more and more certain that the politicians would try to make a scapegoat of him, and that shortly. For one thing, Stires had called only a few days after he closed his doors and imparted a significant bit of information. Albert was still connected with the city treasury, as was Stener, and engaged with Sengstack and another personal appointee of Mollenhauer’s in going over the treasurer’s books and explaining their financial significance. Stires had come to Cowperwood primarily to get additional advice in regard to the sixty-thousand-dollar check and his personal connection with it. Stener, it seemed, was now threatening to have his chief clerk prosecuted, saying that he was responsible for the loss of the money and that his bondsmen could be held responsible. Cowperwood had merely laughed and assured Stires that there was nothing to this.
“Albert,” he had said, smilingly, “I tell you positively, there’s nothing in it. You’re not responsible for delivering that check to me. I’ll tell you what you do, now. Go and consult my lawyer—Steger. It won’t cost you a cent, and he’ll tell you exactly what to do. Now go on back and don’t worry any more about it. I am sorry this move of mine has caused you so much trouble, but it’s a hundred to one you couldn’t have kept your place with a new city treasurer, anyhow, and if I see any place where you can possibly fit in later, I’ll let you know.”
Another thing that made Cowperwood pause and consider at this time was a letter from Aileen, detailing a conversation which had taken place at the Butler dinner table one evening when Butler, the elder, was not at home. She related how her brother Owen in effect had stated that they—the politicians—her father, Mollenhauer, and Simpson, were going to “get him yet” (meaning Cowperwood), for some criminal financial manipulation of something—she could not explain what—a check or something. Aileen was frantic with worry. Could they mean the penitentiary, she asked in her letter? Her dear lover! Her beloved Frank! Could anything like this really happen to him?
His brow clouded, and he set his teeth with rage when he read her letter. He would have to do something about this—see Mollenhauer or Simpson, or both, and make some offer to the city. He could not promise them money for the present—only notes—but they might take them. Surely they could not be intending to make a scapegoat of him over such a trivial and uncertain matter as this check transaction! When there was the five hundred thousand advanced by Stener, to say nothing of all the past shady transactions of former city treasurers! How rotten! How political, but how real and dangerous.
But Simpson was out of the city for a period of ten days, and Mollenhauer, having in mind the suggestion made by Butler in regard to utilizing Cowperwood’s misdeed for the benefit of the party, had already moved as they had planned. The letters were ready and waiting. Indeed, since the conference, the smaller politicians, taking their cue from the overlords, had been industriously spreading the story of the sixty-thousand-dollar check, and insisting that the burden of guilt for the treasury defalcation, if any, lay on the banker. The moment Mollenhauer laid eyes on Cowperwood he realized, however, that he had a powerful personality to deal with. Cowperwood gave no evidence of fright. He merely stated, in his bland way, that he had been in the habit of borrowing money from the city treasury at a low rate of interest, and that this panic had involved him so that he could not possibly return it at present.
“I have heard rumors, Mr. Mollenhauer,” he said, “to the effect that some charge is to be brought against me as a partner with Mr. Stener in this matter; but I am hoping that the city will not do that, and I thought I might enlist your influence to prevent it. My affairs are not in a bad way at all, if I had a little time to arrange matters. I am making all of my creditors an offer of fifty cents on the dollar now, and giving notes at one, two, and three years; but in this matter of the city treasury loans, if I could come to terms, I would be glad to make it a hundred cents—only I would want a little more time. Stocks are bound to recover, as you know, and, barring my losses at this time, I will be all right. I realize that the matter has gone pretty far already. The newspapers are likely to start talking at any time, unless they are stopped by those who can control them.” (He looked at Mollenhauer in a complimentary way.) “But if I could be kept out of the general proceedings as much as possible, my standing would not be injured, and I would have a better chance of getting on my feet. It would be better for the city, for then I could certainly pay it what I owe it.” He smiled his most winsome and engaging smile. And Mollenhauer seeing him for the first time, was not unimpressed. Indeed he looked at this young financial David with an interested eye. If he could have seen a way to accept this proposition of Cowperwood’s, so that the money offered would have been eventually payable to him, and if Cowperwood had had any reasonable prospect of getting on his feet soon, he would have considered carefully what he had to say. For then Cowperwood could have assigned his recovered property to him. As it was, there was small likelihood of this situation ever being straightened out. The Citizens’ Municipal Reform Association, from all he could hear, was already on the move—investigating, or about to, and once they had set their hands to this, would unquestionably follow it closely to the end.
“The trouble with this situation, Mr. Cowperwood,” he said, affably, “is that it has gone so far that it is practically out of my hands. I really have very little to do with it. I don’t suppose, though, really, it is this matter of the five-hundred-thousand-dollar loan that is worrying you so much, as it is this other matter of the sixty-thousand-dollar check you received the other day. Mr. Stener insists that you secured that illegally, and he is very much wrought up about it. The mayor and the other city officials know of it now, and they may force some action. I don’t know.”
Mollenhauer was obviously not frank in his attitude—a little bit evasive in his sly reference to his official tool, the mayor; and Cowperwood saw it. It irritated him greatly, but he was tactful enough to be quite suave and respectful.
“I did get a check for sixty thousand dollars, that’s true,” he replied, with apparent frankness, “the day before I assigned. It was for certificates I had purchased, however, on Mr. Stener’s order, and was due me. I needed the money, and asked for it. I don’t see that there is anything illegal in that.”
“Not if the transaction was completed in all its details,” replied Mollenhauer, blandly. “As I understand it, the certificates were bought for the sinking-fund, and they are not there. How do you explain that?”
“An oversight, merely,” replied Cowperwood, innocently, and quite as blandly as Mollenhauer. “They would have been there if I had not been compelled to assign so unexpectedly. It was not possible for me to attend to everything in person. It has not been our custom to deposit them at once. Mr. Stener will tell you that, if you ask him.”
“You don’t say,” replied Mollenhauer. “He did not give me that impression. However, they are not there, and I believe that that makes some difference legally. I have no interest in the matter one way or the other, more than that of any other good Republican. I don’t see exactly what I can do for you. What did you think I could do?”
“I don’t believe you can do anything for me, Mr. Mollenhauer,” replied Cowperwood, a little tartly, “unless you are willing to deal quite frankly with me. I am not a beginner in politics in Philadelphia. I know something about the powers in command. I thought that you could stop any plan to prosecute me in this matter, and give me time to get on my feet again. I am not any more criminally responsible for that sixty thousand dollars than I am for the five hundred thousand dollars that I had as loan before it—not as much so. I did not create this panic. I did not set Chicago on fire. Mr. Stener and his friends have been reaping some profit out of dealing with me. I certainly was entitled to make some effort to save myself after all these years of service, and I can’t understand why I should not receive some courtesy at the hands of the present city administration, after I have been so useful to it. I certainly have kept city loan at par; and as for Mr. Stener’s money, he has never wanted for his interest on that, and more than his interest.”
“Quite so,” replied Mollenhauer, looking Cowperwood in the eye steadily and estimating the force and accuracy of the man at their real value. “I understand exactly how it has all come about, Mr. Cowperwood. No doubt Mr. Stener owes you a debt of gratitude, as does the remainder of the city administration. I’m not saying what the city administration ought or ought not do. All I know is that you find yourself wittingly or unwittingly in a dangerous situation, and that public sentiment in some quarters is already very strong against you. I personally have no feeling one way or the other, and if it were not for the situation itself, which looks to be out of hand, would not be opposed to assisting you in any reasonable way. But how? The Republican party is in a very bad position, so far as this election is concerned. In a way, however innocently, you have helped to put it there, Mr. Cowperwood. Mr. Butler, for some reason to which I am not a party, seems deeply and personally incensed. And Mr. Butler is a great power here—” (Cowperwood began to wonder whether by any chance Butler had indicated the nature of his social offense against himself, but he could not bring himself to believe that. It was not probable.) “I sympathize with you greatly, Mr. Cowperwood, but what I suggest is that you first See Mr. Butler and Mr. Simpson. If they agree to any program of aid, I will not be opposed to joining. But apart from that I do not know exactly what I can do. I am only one of those who have a slight say in the affairs of Philadelphia.”
At this point, Mollenhauer rather expected Cowperwood to make an offer of his own holdings, but he did not. Instead he said, “I’m very much obliged to you, Mr. Mollenhauer, for the courtesy of this interview. I believe you would help me if you could. I shall just have to fight it out the best way I can. Good day.”
And he bowed himself out. He saw clearly how hopeless was his quest.
In the meanwhile, finding that the rumors were growing in volume and that no one appeared to be willing to take steps to straighten the matter out, Mr. Skelton C. Wheat, President of the Citizens’ Municipal Reform Association, was, at last and that by no means against his will, compelled to call together the committee of ten estimable Philadelphians of which he was chairman, in a local committee-hall on Market Street, and lay the matter of the Cowperwood failure before it.
“It strikes me, gentlemen,” he announced, “that this is an occasion when this organization can render a signal service to the city and the people of Philadelphia, and prove the significance and the merit of the title originally selected for it, by making such a thoroughgoing investigation as will bring to light all the facts in this case, and then by standing vigorously behind them insist that such nefarious practices as we are informed were indulged in in this case shall cease. I know it may prove to be a difficult task. The Republican party and its local and State interests are certain to be against us. Its leaders are unquestionably most anxious to avoid comment and to have their ticket go through undisturbed, and they will not contemplate with any equanimity our opening activity in this matter; but if we persevere, great good will surely come of it. There is too much dishonesty in public life as it is. There is a standard of right in these matters which cannot permanently be ignored, and which must eventually be fulfilled. I leave this matter to your courteous consideration.”
Mr. Wheat sat down, and the body before him immediately took the matter which he proposed under advisement. It was decided to appoint a subcommittee “to investigate” (to quote the statement eventually given to the public) “the peculiar rumors now affecting one of the most important and distinguished offices of our municipal government,” and to report at the next meeting, which was set for the following evening at nine o’clock. The meeting adjourned, and the following night at nine reassembled, four individuals of very shrewd financial judgment having meantime been about the task assigned them. They drew up a very elaborate statement, not wholly in accordance with the facts, but as nearly so as could be ascertained in so short a space of time.
“It appears [read the report, after a preamble which explained why the committee had been appointed] that it has been the custom of city treasurers for years, when loans have been authorized by councils, to place them in the hands of some favorite broker for sale, the broker accounting to the treasurer for the moneys received by such sales at short periods, generally the first of each month. In the present case Frank A. Cowperwood has been acting as such broker for the city treasurer. But even this vicious and unbusiness-like system appears not to have been adhered to in the case of Mr. Cowperwood. The accident of the Chicago fire, the consequent depression of stock values, and the subsequent failure of Mr. Frank A. Cowperwood have so involved matters temporarily that the committee has not been able to ascertain with accuracy that regular accounts have been rendered; but from the manner in which Mr. Cowperwood has had possession of bonds (city loan) for hypothecation, etc., it would appear that he has been held to no responsibility in these matters, and that there have always been under his control several hundred thousand dollars of cash or securities belonging to the city, which he has manipulated for various purposes; but the details of the results of these transactions are not easily available. “Some of the operations consisted of hypothecation of large amounts of these loans before the certificates were issued, the lender seeing that the order for the hypothecated securities was duly made to him on the books of the treasurer. Such methods appear to have been occurring for a long time, and it being incredible that the city treasurer could be unaware of the nature of the business, there is indication of a complicity between him and Mr. Cowperwood to benefit by the use of the city credit, in violation of the law. “Furthermore, at the very time these hypothecations were being made, and the city paying interest upon such loans, the money representing them was in the hands of the treasurer’s broker and bearing no interest to the city. The payment of municipal warrants was postponed, and they were being purchased at a discount in large amounts by Mr. Cowperwood with the very money that should have been in the city treasury. The _bona fide_ holders of the orders for certificates of loans are now unable to obtain them, and thus the city’s credit is injured to a greater extent than the present defalcation, which amounts to over five hundred thousand dollars. An accountant is now at work on the treasurer’s books, and a few days should make clear the whole _modus operandi_. It is hoped that the publicity thus obtained will break up such vicious practices.”
There was appended to this report a quotation from the law governing the abuse of a public trust; and the committee went on to say that, unless some taxpayer chose to initiate proceedings for the prosecution of those concerned, the committee itself would be called upon to do so, although such action hardly came within the object for which it was formed.
This report was immediately given to the papers. Though some sort of a public announcement had been anticipated by Cowperwood and the politicians, this was, nevertheless, a severe blow. Stener was beside himself with fear. He broke into a cold sweat when he saw the announcement which was conservatively headed, “Meeting of the Municipal Reform Association.” All of the papers were so closely identified with the political and financial powers of the city that they did not dare to come out openly and say what they thought. The chief facts had already been in the hands of the various editors and publishers for a week and more, but word had gone around from Mollenhauer, Simpson, and Butler to use the soft pedal for the present. It was not good for Philadelphia, for local commerce, etc., to make a row. The fair name of the city would be smirched. It was the old story.
At once the question was raised as to who was really guilty, the city treasurer or the broker, or both. How much money had actually been lost? Where had it gone? Who was Frank Algernon Cowperwood, anyway? Why was he not arrested? How did he come to be identified so closely with the financial administration of the city? And though the day of what later was termed “yellow journalism” had not arrived, and the local papers were not given to such vital personal comment as followed later, it was not possible, even bound as they were, hand and foot, by the local political and social magnates, to avoid comment of some sort. Editorials had to be written. Some solemn, conservative references to the shame and disgrace which one single individual could bring to a great city and a noble political party had to be ventured upon.
That desperate scheme to cast the blame on Cowperwood temporarily, which had been concocted by Mollenhauer, Butler, and Simpson, to get the odium of the crime outside the party lines for the time being, was now lugged forth and put in operation. It was interesting and strange to note how quickly the newspapers, and even the Citizens’ Municipal Reform Association, adopted the argument that Cowperwood was largely, if not solely, to blame. Stener had loaned him the money, it is true—had put bond issues in his hands for sale, it is true, but somehow every one seemed to gain the impression that Cowperwood had desperately misused the treasurer. The fact that he had taken a sixty-thousand-dollar check for certificates which were not in the sinking-fund was hinted at, though until they could actually confirm this for themselves both the newspapers and the committee were too fearful of the State libel laws to say so.
In due time there were brought forth several noble municipal letters, purporting to be a stern call on the part of the mayor, Mr. Jacob Borchardt, on Mr. George W. Stener for an immediate explanation of his conduct, and the latter’s reply, which were at once given to the newspapers and the Citizens’ Municipal Reform Association. These letters were enough to show, so the politicians figured, that the Republican party was anxious to purge itself of any miscreant within its ranks, and they also helped to pass the time until after election.