B.—No. 5.

No. 1 Copy of a Despatch from Governor Sir George Grey, X.C.8., to the Right Honorable the Earl of Carnarvon. (No. 35.) Government House, "Wellington, My Lord, — sth April, 1867. I have the honor to transmit a copy of a letter addressed on the Ist instant by the New Zealand Government to the senior Commissariat Officer in the Colony, on the subject of serious frauds committed on the Colonial Revenue under the authority of certificates issued by Commissariat Officers. 2. I wish to draw your Lordship's attention to the fact that,, so long ago as the 19th of October last, the Colonial Government requested the Commissariat to furnish returns of the actual number of ration* issued by the Contractors in each month, which returns would have enabled these frauds to have been fully traced out, and that up to this date the returns asked for have not been supplied. 3. From the enclosed letter from the Military Secretary to General Chute, your Lordship will find that eveiy day increases the difficulty of tracing these frauds, as in consequence of the reduction of the Force in the Colony, many civilians, clerks, issuers, &c, &c, are being discharged, and the non-commiu-B ioned officers and men of the Commissariat Staff Corps are about to embark for England. I have, &c , The Right Honorable the Earl of Carnarvon, G. Grey. <fee, &c, <kc.

Enclosure 1 in No. 3. The Hon. E. W. Stafford to Deputy Commissary-General Strickland. (No. 317.) ' Colonial Secretary's Office, Sir, — Wellington, Ist April, 1867. I have the honor to draw your attention to a correspondence dating from 9th October, 1806, to 28th January, 1867, which passed between the Collector of Customs at Auckland and certain Commissariat Officers with respect to certificates issued for payment of drawback on grocery rations supplied by Contractors to the Troops from January 18G3 to 1866. The Collector of Customs at Auckland pointed out in his letter of the 9th October last some grave errors committed in respect of these certificates by Commissariat Officers, and in his letter of the 19th of that month furnished a Return of all the drawbacks paid by the Customs on grocery rations for the Troops, and requested to be supplied with a Betuiii of the actual number of rations issued by Contractors in each month and at each place since Ist January, ISO 4. Up to the 12th ultimo this Return had not been supplied to the Collector. A Return was furnished on the 10th of January last of the gross number of rations received from Contractors in the Province of Auckland in the year 1863, and on the 14th of that month another was given of the total number of rations received in the Waikato District from Ist January, 1864, to 31st August, 1866 ; but these Returns do not specify what each Contractor was entitled to for drawback for rations supplied at each of the Stations, and therefore do not contain the information requisite to enable the Government to ascertain the exact amount of over-payments which have been made. An examination of the Returns received shows that in 1863 a Contractor, J. Hall, was overpaid the drawback on 39,840 rations. Tor the subsequent period (Ist January, 1864, to 31st August, 18(iC,) a Contractor, W. J. Young, obtained certificates from the Commissariat which enabled him to secure overpayment on no less than 590,377 rations. The average amount of duty on each ration is about one farthing. Mr. Young must therefore have received an overpayment from Colonial funds of more than six hundred pounds. It appears that in one case a certificate was signed twice by the same Commissariat Officer (D.A.C.G. Dunn) in favor of one Contractor, R. Simpson. In another case, the certificate for certain rations was signed twice by different Commissariat Officers (D.A.C.G. Graham and A.C.G. Moore) in favor of one Contractor, J. Hall. And again, one Commissariat Officer (D.A.C.G. Innes) signed certificates to two Contractors, R. Simpson and W. J. Young, for the same rations. In all the above cases the Customs paid the drawback on each certificate. And further, another Commissariat Officer (D.A.C.G. Marshall) signed a certificate in favor of th« Contractor, R. Simpson, for rations which had twice before been signed for by the Commissariat, and the drawbacks on which had twice been paid by the Customs. It is to be borne in mind that the Customs Department accepts the certificates on the faith of th« signatures of the Officers of the Commissariat Department, on whom rests the responsibility of preventing unjust claims (vouched by themselves) for drawback of duty being made against the Colonial Government. All ascertained overpayments on this account will accordingly have to be refunded by the Commissariat Department, and it also remains to be considered what steps are to be taken to prosecute such of the Contractors or other pei-sons as have defrauded or attempted to defraud the Government. I have now to request that you will be good enough to furnish for the information of the Government the detailed Return of Rations required so long since by the Collector of Customs at Auckland referred to in a previous part of this letter. I have, <fee, E. W. Stafford. Deputy Commissary-General Strickland, Auckland. P.S.—The information referred to in my letter of the 29th ultimo to Commissary-General Jones ha» no connection with the cases referred to herein.

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