B.—l [Pt. ll].

Office which involved the theft of public moneys by departmental officers. Notwithstanding, however, the numerical increase in irregularities I am of the opinion that the general accounting system of the Government may be considered satisfactory and that a high standard has been maintained throughout the service. The largest defalcation concerned a fraud perpetrated by an officer of the Post Office Savings-bank. Through manipulation of ledger card entries and by forgery this officer fraudulently withdrew £1,599 Os. 5d., of which sum £136 10s. has been recovered. He was sentenced to two years' imprisonment with hard labour. By somewhat similar means a cadet in the Post Office Savings-bank misappropriated the sum of £425, of which £388 has already been recovered, and when the offender was admitted to probation an order for restitution of the balance was made. A non-permanent Postmaster of the Post and Telegraph Department converted £218 4s. Bd. to his own use mainly by falsification of entries in his records, and of this amount £100 was covered by fidelity-guarantee bond. The offender was sentenced to imprisonment for a term of eighteen months. Whilst acting as cashier in the Christchurch office of the Government Life Insurance Department an officer misappropriated insurance premiums amounting to £296 11s. 3d., of which sum £58 19s. 7d. has been recovered. This officer was sentenced to nine months' imprisonment. An officer of the New Zealand Government Eailways Department failed to account for £160 18s. 2d., mainly representing proceeds of sales of tickets, and the full amount of this loss has been recovered from the offender. This defalcation appears to have been made possible through a weakness in the internal checking of the accounts of the Booking Office concerned, but additional safeguards which have been introduced by the Department should prevent losses under this head from reaching such dimensions in the future. I must again draw attention to the many instances where relief recipients have secured excess relief from the moneys of the Employment Promotion Fund. During the year no less than 3,257 relief recipients (an increase of 1,296 over the number recorded in the previous year) fraudulently received relief to which they were not entitled, and the majority of these irregular payments were obtained through their having made false statements.

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