2

G.—s

I found that the only books of account kept by Mr. Young were a cash-book and a book in which lie entered the several payments chargeable to each block of land purchased. The cash-book presented a simple record on the one side of the sums advanced to him by the Treasury, and on the other of sums paid to Natives on account of specified blocks of land. The entries were in the handwriting of Mr. Warbrick, and, apart from one or two errors in addition the book was fairly kept; though it was evidently only written up at intervals, and was balanced so as to coincide with the periodic accounts rendered to the Treasury. I was informed by Mr. Mitchell that up to about December, 1878, Mr. Young kept no cash-book at all, contenting himself, it is supposed, with an office-copy of (he periodical statement of account forwarded by him (o the Treasury. On Mr. Mitchell's expressing his surprise at this loose mode of conducting his business, and pointing out that .such a practice was not only dangerous but was a neglect of regulations, Mr. Young obtained a cash-book, in which his transactions were then entered up from the Bth day of August, 1878, the date of his earliest receipts and payments. As I have already stated, the entries in this book appear to have been made periodically, the dates of payments in numbers of instances not coinciding with the order in which those payments were entered. I am, of course, unable to state with certainty the mode adopted by Mr. Young in making up his accounts ; but, from circumstances which came under my observation, I have no doubt that his practice was, first to make up his account to be rendered to the Treasury, and then to transcribe it into his cash-book. Since writing the foregoing paragraph, I have seen a memorandum recording certain information supplied to Mr. Churton, Audit Inspector, by Mr. "Warbrick, while in Mount Eden Gaol, and previous to the trial of Mr. Young. The statements of Warbritk as to Mr. Young's mode of making up his accounts coincide very nearly with my own theory on that subject. I must, however, confess, notwithstanding the intimate knowledge I have acquired of Mr. Young's proceedings, to being considerably startled by Mr. Warbriek's description of the process by which the account was " made up," the blocks of land chargeable determined, and the vouchers " constructed." The book into which the cash-book was intended to be posted was designed to show, under the headings of the several blocks of land under negotiation, the payments made on account of each. This book was also in the handwriting of Mr. Warbrick, but it was very incompletely posted up, and consequently of very little use. An account so apparently simple as that presented by the cash-book seemed to offer little scope for investigation. With only twelve exceptions over the whole period, every entry recorded a payment to a Native on account of one or other of some dozen, blocks of land, in the purchase of or negotiation for which Mr. Young had bern concerned. These payments were apparently all duly vouched by the signatures of the Natives, the signatures and payments appeared to have been properly attested by Mr. Warbrick, the unexpended balance of advances had been duly refunded, and the account to all appearance satisfactorily closed. But, on comparing the entries in the cash-book with the butts of the cheque-books and with the bank pass-book, 1 found that irregularities had taken place, which necessitated inquiry into the transactions of Mr. Young with Mr. Warbrick, with the National Bank, with the principal storekeepers in Tauranga, and with the Natives, to whom payments appeared by the cash-book to have been made. It was, of course, quite impossible to examine more than a small minority of the latter ; but, taking advantage of the presence of a number of Te Puke Natives in Tauranga, I devoted a week to the task of examining them as to the moneys they had received from Mr. Young and those with which, they were charged in his accounts. 1 then proceeded to Maketu, at which place a large number of the Natives with whom Mr. Young had had transactions resided ; and, after devoting another week to examining them on the subject, I returned to Tauranga, I attach to this report minutes of the evidence taken at these examinations. As the result of my inquiries I found—■ That moneys alleged to have been paid to Natives, in many instances had never been paid at all; That, in other cases, moneys charged as paid to Natives were paid to Mr. Young's private account, and not to the Natives ; That moneys alleged to have been paid to Natives were in reality paid to certain " No. 2 accounts," opened by Young and Warbrick at the National Bank and at the Bank of New Zealand ; but whether these sums ever reached the Natives to whom they were charged is, in some cases at least, matter of grave uncertainty; That in innumerable instances moneys charged as paid to Natives were paid, in fact, to storekeepers for goods supplied. It must be remembered that in all the instances alluded to above, Young had furnished a voucher receipted by the Native to whom the money was charged, such receipts being attested by Warbrick as " witness to the payment and signature." It is, however, certain that in some cases the signature of the Native was a forgery. In many others, though the signature was genuine, the form to which it was attached had originally been signed by lhe Native iv blank, and in connection with a wholly different transaction, but had been used by Young to substantiate the false entry in his cash-book. Warbrick has stated in writing that it was his practice, under iToung's direction, to fill up these blank but receipted vouchers by the hundred as occasion required, and to use them in support of the cash accounts. I may state that upwards of 170 of these blank voucher-forms, receipted by the Natives, were found in the office. I shall now proceed to describe in detail the irregularities above referred to. I have said that moneys alleged to have been paid to Natives had in many instances not been paid 3,t all. In confirmation of this assertion I will state first the cases of Hohaia Tarakawa.