Public Trust Office Scandal.

Gisborne Standard and Cook County Gazette, Volume V, Issue 623, 20 June 1891, Page 2

Public Trust Office Scandal.

REVELATIONS IN PARLIAMENT. SOME NICE PICKINGS OF WIDOWS’ AND ORPHANS’ PROPERTY. [SPECIAL TO THE STANDARD.] Wellington, last night. The report of the Public Trust Commission was laid on the table of the House to-night. The report is very severe on the management of this department of the Public Service. Condemnation is in every line of the report. The Commissioners say that they feel compelled to state that so far as the head office is concerned, there has been absolute want of any proper or regular system up to the present time in the conduct of its business.

The books of the office have for years been kept in a careless and unfinished manner, particularly the ledgers and rough cash books. Correspondence by the Public Trust Office has been conducted in an unsatisfactory and irritating manner. Neither the Public Trustee nor the officers serving under him, seem to have acquired the habit of writing the courteous and businesslike letters that are customary in all well regulated establishments, but have practised a system of sending formal memoranda, and as a rule giving very limited information to clients, and the Commissioners were very much surprised when they discovered during the course of their investigations that the system of Government audit practised in relation to the business of the Public Trust Office has been in reality a delusion. Securities have been certified to as correct by the Auditor-General, when, had he and his inspecting officers faithfully performed their duty, they should have known that some of the mortgages had been long since foreclosed by the Public Trustee, and ipso jacto had ceased to exist: that securities had been exposed for sale by auction, and had been bought in by the Public Trustee, as the highest bidder, for less than one-half, and even as low as oneeighth, of the money originally advanced upon them, and still they have been passed year after year by the Audit Department as representing the full amounts advanced. In addition to this startling misrepresentation of facts a large amount of the interests due upon many of those mortgage securities has been for several years in arrear, and has never been brought to account in the ledgers of the Public Trust Office which had been in the office. Up to the end of 1889 ten per cent, seems to have been the charge made for the collection of rents, and where an agent was employed he was allowed one-half, or equal to five per cent. Since the year 1 SBo, percent, has in many cases been charged ; agents, whenever employed, receiving two-thirds, or five per cent, for collecting. The income charge has been five per cent., and where agents are employed Pei eent. is paid them, but in all cases where it has not been necessary to employ agents the Public Trust Office seems to have taken the full benefit of the maximum charge of commission made to clients. The agents, too, are allowed to charge borrowers' procuration fees on applications for loans recommended by them for the consideration of the Public Trust Office.

In 1889 the Colonial Treasurer took away from the supposed profits of the Public Trust Office, as they appeared in the annual balance sheet on the 31st of December, the sum of £lB,OOO, for the Consolidated Fund. The Commissioners desire to draw attention to the sum of over Zj 0 , 000 which was absorbed by the colony from the Unclaimed Fund, and balances arising out of the adminstration of estates vested in the Public Trustee. This sum is exclusive of the £lB,OOO previously referred tot