January 24, 1905


House in Committee of Supply. Civil government'-Department of Militia and Defence-salaries, $48,350.


?

Rt. H@

The first item for the deputy head requires no explanation. The second item, that of chief clerks, shows a decrease of one by the superannuation of Major Benoit. Instead of live chief clerks, there will be four.

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CON
LIB

Wilfrid Laurier (Prime Minister; President of the Privy Council)

Liberal

Sir WILFRID LAURIER.

He must have been thirty years in the service and about sixty years of age.

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CON
LIB

Wilfrid Laurier (Prime Minister; President of the Privy Council)

Liberal

Sir WILFRID LAURIER.

Because of very serious and chronic had health. In the first-class clerks, there is an increase of one owing to the promotion of Mr. Chesley.

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CON
LIB

Wilfrid Laurier (Prime Minister; President of the Privy Council)

Liberal

Sir WILFRID LAURIER.

No, there are two vacancies which we do not intend to fill. In the second class there were eight last year, and only six this year.

Mi-. FOSTER. Are all of the six clerkships unfilled ?

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LIB
CON

George Eulas Foster

Conservative (1867-1942)

Mr. FOSTER.

So that the reduction is simply an apparent one, because the full number was not filled last year.

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LIB

Wilfrid Laurier (Prime Minister; President of the Privy Council)

Liberal

Sir WILFRID LAURIER.

We might have found people to fill them, but resisted the temptation.

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CON

George Eulas Foster

Conservative (1867-1942)

Mr. FOSTER.

Has my right hon. friend any idea as to the outcome of that Marti-neau business ? He will remember that there was a serious lache in the Militia Department, and that there was a suit of some kind in which Martineau gave evidence. Did that evidence implicate others, and what is the position of Martineau now ?

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Hon. CHARLES FITZPATRICK (Minister of Justice).

He is in the penitentiary at Kingston now. I think his sentence was for seven years. So far ns the civil remedy is concerned, the government have taken action against the Bank of Montreal to recover the money paid out on these cheques, and the case is somewhat complicated by the fact that the Bank of Montreal has taken action against the other banks through which the cheques were passed. The suit is now waiting judgment by Mr. Justice Anglin.

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CON

George Eulas Foster

Conservative (1867-1942)

Mr. FOSTER.

It seems rather extraordinary that such defalcations could have taken place in a well organized and super-

vised department. As I understand, cheques were drawn in -a very loose way and were signed only by one person. The whole transaction seemed to show something wrong in the supervision and checking ol that kind of work. One finds it difficult to understand how a raw, new clerk could have had such facilities free of check or supervision. Have any steps been taken to 'render such defalcations more difficult ?

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

It is almost impossible for any individual or government to protect itself absolutely against fraud. The practice in the departments requires that all cheques be signed by two officials. In addition, when the cheques were returned to the department, the practice was to have them compared with the bank list by two of the officials, the one independent altogether of the other. It would appear that there was some remissness in that respect.

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CON
LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

No, but instead of having two officials go over the cheques and compare them with the bank list at the end of the month, only one did the work. It appears to me that when at the end of the month the bank returned its statement of the amounts paid over, the cheques should have been in the hands of an official of the department and there ought to have been some method of ascertaining what had been going on during the month. We are in the habit of criticising very severely, on both sides, the action of the officials of the department, and we are told that there are practices in the department which would not be tolerated in any private institution. It would appear that some of the cheques in question were paid with only one signature attached. That was not the fault of the department, but of the bank that paid the amount. In fact, 1 understand, that some of the cheques bore no signature at all-simply the official cheque filled in. So, this is not a case of laxness or remissness exclusively on the part of public officials.

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

Have any steps been taken to collect the guarantee bond which this man Martineau put up when he was appointed ? I suppose he did put up a guarantee bond ?

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

Nothing was done with respect to the guarantee bonds. I think my hon. friend (Mr. Fowler) will bear me out when I say that it would not be the part of prudence to take steps against the guarantor until we have settled the question of liability. Our contention is that there is no liability, that the cheques being bogus cheques, the bank was not authorized to make payment to Martineau.

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January 24, 1905