Repository: UIHistories Project: Book - History of the University (Nevins) [PAGE 177]

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SPALDING'S DEFALCATION

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of a Board committee in 1895 upon the financial system, which, though approving, it, suggested a better method of checking accounts, and stated that the safety of the fund had depended less on the plan than on the integrity of the responsible officers. The amendments made still provided imperfectly for the care of the ready money and endowment, and though in March, 1897, the statement of the Treasurer was pronounced correct, three weeks later grave irregularities in his affairs were reported. A special Board meeting was hurriedly called, and a new Treasurer elected—Elbridge Q. Keith. It appeared at this meeting that the Treasurer had been intrusted with bonds and cash of the endowment amounting to about $460,000, and with current funds totaling $95,000 more; and that of this $430,000 had been misapplied. For the moment there was some consternation. All the cash balances were involved, all the appropriations had been collected to the end of the year, and the statutes so completely forbade indebtedness that it was impossible to obtain credit to pay salaries. There were other claimants to what property Spalding could transfer to the Trustees, and to enforce the liabilities on the bond he had given was a slow process. John Farson offered to become one of ten men to advance the University $50,000 each, but happily there was a better way out. The Legislature was then in session, and the University had just asked it for its greatest appropriation, for which it was bringing all possible pressure to bear. The leaders were at once induced to establish a Senate committee to investigate the University's losses, of which Henry M. Dunlap was made chairman. Its report was written by Senator Dunlap with Dr. Draper's assistance, and embodied the recommendations of the latter.