The 1823 Inquiry into how Arthur Cuthbert and the Commissioners made such a large amount of money in India

An Inquiry into the Conduct of the Commissioners for Victualling His Majesty's Navy as it related to the Examination and Final Passing of Accounts; Showing the Delay that took Place and the Opposition Manifested by them, and by The Lords Commissioners of the Admiralty, to a Change of System in the Victualling Department Notwithstanding its Adoption in the Naval; by which the Public have Sustained Considerable Loss and the Honorable Basil Cochrane, Late Contractor and Agent Victualler in the East Indies, was Materially Injured.

 

The Whole arranged Chronologically; and Exhibiting, in a Variety of Instances the Arbitrary and Oppresssive Manner in which they Conducted Themselves in the Examination and Final Settlement of his Accounts.

 

London, Printed by J. Davy, Queen St, Seven Dials

 

1823.

 

Between the years 1757 and 1763, Mr. Arthur Cuthbert went to India as a fore-castle man in one of the flag ships; and during the voyage, the purser's steward dying, the boatswain was asked whether there was a seaman on board that could write and keep accounts; - Mr Cuthbert was produced, and took the place of purser's steward.

 

The liberal education he appears to have received, added to his close application to the business of his situation, soon introduced him into the secretary's office, where he made himself very useful, particularly whilst the fleet was at Manillba (?), by acting as an interpreter in the Latin language between the admiral and the government of that place.

 

In the secretary's office he had an opportunity of making himself master of the mode of keeping accounts, and preparing the various certificates, orders, &c. required by the naval and victualling departments in London, to insure their being passed in those offices; and, as the sequel will show, he amply profited by that experience. After the peace in 1763, he remained in India, and settled at Madras as a free merchant.

 

Upong the arrival of Sir John Lindsay at Madras, as commander in chief of the naval forces in India, in the year 1769, Mr. Cuthbert being the only person at Madras that was considered well acquainted with the mode of conducting the business of the naval, victualling, and transport departments belonging to a fleet, he was requested by Sir John Lindsay to undertake the management of those duties. Mr. Cuthbert consented; and having fulfilled his engagement to the satisfaction of Sir John Lindsay, Sir Robert Harland who succeeded Sir John in the command, in the year 1771, requested Mr Cuthbert to continue to conduct those departments belonging to the fleet under his command.

 

 

1774 

In 1774 Sir Robert Harland sailed for England; and about the same time Mr Cuthbert also left Madras for England, in order to get the accounts of the respective fleets passed at the navy, victualling, and transport boards in London; which it was understood he accomplished to the satisfaction of all parties concerned.

 

1776

On the breaking out of the first American war, the late Viscount Howe was appointed commander in chief of his Majesty's ships employed, and to be employed, on the North American station. He hoisted his flag on board the Eagle, and arrived at Halifax on the 1st July 1776.

 

10 February 1776,

Mr George Cherry (afterwards chairman of the victualling board) was appointed purser of the Eagle; and also acted as secretary and agent victualler to the fleet serving under his Lordship's command.

 

July 1778

Charles Middleton, Esq. a captain in the royal navy, afterwards Sir Charles Middleton, Bart., succeeded Maurice Suckling, Esq; as comptroller of the Navy

 

August 1778

In the course of this month, Viscount Howe resigned the command to Admiral Byron, and returned to England in the Eagle on the 25th October following, when he struck his flag.

 

Jan 1779

Admiral Sir Edward Hughes sailed from England as commander in chief of a very large naval force the accompanied him for India. Mr. Thomas Moore was the Admiral's secretary; on the voyage Mr. Arthur Cuthbert (who returned to Madras in the flag ship) was appointed victualling store-keeper, namely, in the month of April, 1779, and upon the arrival of the fleet at Madras he was also appointed naval store-keeper.

 

May 1780

Upon the death of Mr. Thomas Moore, Mr. Cuthbert succeeded as the Admiral's secretary and with that appointment he also became agent-victualler; and thus Mr. Cuthbert was in the triple capacity of Secretary, Agent Victualler, and Naval Agent to the fleet serving in India under the command of Sir Edward Hughes.

 

At this time, the whole of the expense of maintaining a large naval force in the Indian seas was defrayed by government; but in the year 1781, and act of parliament(1781, 21 Geo. III.cap.65.) passed, obliging the East India Company, after the month of July 1782, and during hostilities with France, to supply the victualling of his Majesty's ships to be sent to the East Indies upon their requisition, &c., the commissioners of the treasury to pay to the Company one-fourth part of the value of such victualling, except when the Company should not be able to make a dividend of eight per cent., when the public should re-pay more than a fourth part of the expenses of victualling; and by this act, the Company were also obliged to supply naval and military stores for the repairs, &c. of his Majesty's ships, the prime cost of which was to be re-paid by the Treasury during hostilities with France, and upon the restoration of peace the Company were to furnish the said stores at their own expense.

 

July 1782

Upon the above act of parliament arriving in India, the Calcutta and Madras presidencies endeavoured to establish a contract for victualling his Majesty's ships in India. Mr. Cuthbert hearing of this, and knowing the distressed state of the Company's finances, and the limited state of the market at Madras, determined to secure to himself the supplying of his Majesty's ships; and with this view, he sent in to the Madras government, in his capacity of agent victuallaer and naval agent, a requisition for a very large supply of provisions and naval stores, stating, that if not complied with, the responsibility of the fleet remaining inactive would fall upon the Company. Surprised at the extent of the requisition, and knowing the state of their finances, and the inadequacy of the Madras market to supply the quantity required, the government were obliged to leave to Mr. Cuthbert the procuring and supplying the fleet with provisions and naval stores, as well the repairs of the ships.

 

Thus Mr. Cuthbert took upon himself all the responsibility of supplying the fleet with provisions and victualling stores, with naval stores, and of repairing the ships; and he continued to do so for a period of four ande a half years; and during that period, he disbursed, on account of provisions and victualling stores only, the enormous sum of £1,024,526. 14s 6¼d (Appendix No.2), and so closely did he comply with the rules of office, and thus prevent any objection being raised to his accounts, that for every disbursement, however trifling, vouchers were produced.

 

30th December 1783

On this date, Viscount Howe succeeded Viscount Keppel as first Lord of the Admiralty.

Prior and subsequent to this date, it was the custom for the House of Commons to vote money for the support of the navy, agreeable to the estimates drawn up in the respective departments; and when the amount disbursements exceeded the sum annually voted, there were included in the estimates for the ensuing year, sums under the head of Debt of the Navy, which were employed in partly liquidating the same.

 

The debt of the navy seems to have originated from the power that was given to the respective naval departments to grant bills payable in fifteen months, with which they paid for provisions and stores delivered in England, reserving the ready cash annually voted by parliament to meet the bills drawn by foreign agents; the extent of whose accounts, or how far the money so voted had been fairly and honourably accounted for, does not appear to have been rendered to parliament.

 

If not regularly paid off when become due, these bills bore a discount, which ultimately fell upon the government; because the contractors, in their estimates of future contracts, calculated on sustaining certain losses on that account; and this system of raising money was the source of extensive speculations by persons, who, from their situations, were acquainted with the number of the bills that would be first paid off, and who were also in the secret of the particular sums, for that purpose, for which application was to be made to parliament.

 

It does not appear to have been the custom for either the navy or victualling departments to furnish to the Lords of the Admiralty annual statements of the actual disbursements of the year preceding, showing in what respect they had exceeded or fallen short of the sums voted by parliament; showing also what accounts had been passed, and what remained to be passed; and whether charges of foreign agents at the different stations had exceeded or were under the original estimates: nor does it appear to have been the custom for the Lords of the Admiralty to require such returns; so that the respective boards under them had it in their power to pass the most exorbitant charges without the least apprehension of very being called upon to account for the same.

 

The fact of the very low salaries allowed to the clerks who had the examining and reporting upon the accounts in the above departments, and the chief officers and clerks in those departments being authorized to recieve fees upon the passing of an account, which increased or diminished in proportion to the extent of the account so passed, was no doubt calculated to encourage the agent victuallers to give in fraudulent charges; it was also an inducement for the officers and clerks to report an extravagant account as correct and fit to be passed by the board: and for this reason, the allowances made to agent victuallers for performing their respective duties were exceedingly trifling, and the fees authorized to be taken in the victualling department amounted to £3.13s.6d. upon every £1000.; hence those agents, with the view of establishing a fund to secure a speedy settlement of their accounts, by meeting the fees thus authorized to be received, were in fact obliged to make overcharges either in the prices of provisions, store charges, and rates of exchange, or by false condemnations; while the clerks being paid in proportion to the extent of the accounts they had to pass, it becasme a mutual interest that they should be passed for as large a sum as possible, provided they were drawn up conformably to the established forms of the office; of which we shall have occasion to speak hereafter.

 

1784

The Honourable Basil Cochrane, who had been a civilian on the Madras establishment

since the year 1769, and at this time resided there, was an eye witness to large quantities of condemned provisions being landed from his Majesty's ships at different times, and kept on the beach ready to be sent off to other ships, in order to be again condemned. He believes it was a matter of notoriety that these condemned provisions were again sent on board ships, and again condemned, at the expense of the public.

 

May 1785

Admiral Sir Edward Hughes returned to England from his command in the East Indies, accompanied by Mr. Arthur Cuthbert. The accounts of Mr. Cuthbert, as before mentinoed, were to an enormous amount, considering the short period he acted as agent victualler, namely four and a half years; and for this reason, and as the East India Company had to contribute three-fourth parts of such expense, his accounts required a more than ordinarily strict investigation.

 

1785

By an act of parliament passed in this session, Commissioners were appointed to inquire into the fees, gratuities, perquisites, and emoluments, which are or have been lately received in the several public offices of Secretaries of State - Treasury - Admiralty - Treasurer of the Navy - Commissioners of the Navy - Dock Yards - Sick and Hurt Office - Victualling Office - Naval and Victualling Departments at Foreign and distant parts - and Post Office.

 

26 August 1785

And by an order in council of this date they were directed "forthwith to proceed upon the inquiries intended by the said act"; "adding such observations as might occur to them therein."

 

Our investigation will hereafter be confirmed to the fifth, eighth, and ninth reports of those Commissioners, as relating to the departments under the Commissioners of the Navy and Victualling Boards, so far as regards the Accounts of Agents upon Foreign stations.

 

10 September 1785

Whilst Lord Howe was first Lord of the Admiralty, he appointed Mr. George Cherry ( who, as before noticed, was purser, secretary, and agent victualler under his Lordship during his command on the North American station) a commissioner of the victualling board, in the room of Joah Bates, Esq. who was removed to the Customs; and on the 22nd (22 October 1785) following, Mr. Cherry had assigned to his particular care the superintendance over the cash department, which gave him the rank of chairman of the board.

 

October 1785

By the Gentlemen's Magazine of this monthl, it appears that the daughter of Mr. Arthur Cuthbert was married to the son of Mr. George Marsh, then first commissioner of the navy board; and which was certainly a very judicious step if Mr. Cuthbert thereby intended to secure the friendship of Mr. George March in the examination and passing of his accounts; added to which Mr. Arthur Cuthbert gave with his daughter the sum of £40,000. As to the amount of Mr. Cuthbert's accounts in this department, we confess that we are unacquainted; but we nevertheless have reason to suppose that whatever the amount, they were passed by the month of July 1787

 

As connected with the object of Inquiry, we extend the following from Clarke and McArthur's Life of Lord Nelson, vol.1, published in 1809

 

It appears, that during the first American war, Lord Nelson served in the West Indies, and on the North American station, viz. - that on the 8th April, 1777, he passed his examination as a lieutenant, and the next day (8th April 1777) was appointed second lieutenant to the Lowestoffe frigate, of 32 guns, Captain W. Locker, which sailed from Spithead, for the Jamaica station, on the 16th May, 1777, and arrived in Port Royal harbour on the 19th July following; - that on the 8th December, 1778, he was appointed commander of the Badger brig, and on the 11th June 1779, was made post inot the Hincinbrook;- that in November, 1782, he sailed with Lord Hood from New York to the West Indies, where he remained till the peace, when he came to England, being directed in his way to attend His Royal Highness Prince William Henry, afterwards Duke of Clarence, on his visit to the Havannah, and was paid off at Portsmouth, on the 3rd July, 1783. In the autumn of this year he went to France, and remained there till the spring of the year 1784, when he was appointed to the Boreas frigate, of 28 guns, and ordered to the Leeward Island station, and arrived at Barbadoes on the 26th of June (1784) of that year; where he found, in Carlisle Bay, the Adamant, with the flag of Admiral Sir R. Hughes, the commander in chief, and other ships; and it was no small degree of satisfaction to Captain Nelson to find himself senior captain, and second in command to that station.

 

"In August, 1786, Sir R. Hughes left the station, and the command devolved upon Captain Nelson, when he turned his mind towards correcting the abuses inh the dock yard at Antigua, as well as among the contractors, prize agents, Greenwich Hospital money &c.; which, both on this station, and on his return home, he pursued with his usual ardour. But in the progress and accomplishment of this great national service, on which his mind was now so constantly employed, he was, during this month of November, 17876, joined and supported by his Royal Highness Prince William Henry, captain of the Pegasus.

 

"It is evident from the following letters that wer found amongst his papers how much he was afterwards harassed by resolutely persevering in the detection of public fraunds in the West Indies Islands. Some of these letters are without date, and one without any address. The first to Sir Charles Middleton, afterwards Lord Barham, is dated Boreas, Nevis, 2nd May, 1787, and throws considerable light on what has already been mentioned.

 

May 1787

"'Sir, as a fraud is likely to be discovered in the naval department under your direction, I think it proper to make you acquainted with it, that villany may be punished, and frauds prevented in future. But before I proceed, I cannot help mentioning a circumstance which hurt me, when I was first left in the command here. The deputy naval officer brought me bills to sign for money, which was owing for goods purchased. I insisted upon having the original vouchers brought to me, that I might examine if they were really purchased at the market price, and that government was not cheated: this I could not obtain; and I therefore wrote to your board upon the subject of my approval of bills, without being convinced, that the former money, I had approved of drawing for, had been expended to my satisfaction, and laid out in the most advantageious manner for government. The answer seemed to imply, that you thought the old forms were sufficient; which consisted only in a certificate from the naval officer, and the master ship-wright, that so much money was wanted. Since that period, Sir, I have been less close in my examination; as I should have been very sorry to have incurred the displeasure of a gentleman who stands so high as you do, both as a professional man, and in the department which you fill with so much honour.

 

"' I enclose you the accounts of teh fraud, from March to June, 1782. It will be necessary I should tell you who these gentlemen are, that have given the information: they were the patners of ---------. Mr. W. is a very shrewd, sensible man. Mr H. is likewise a man of business. W. has been in various departments of government, in St.Lucia, Barbados, &c., and assures me, he can discover all the frauds committed there, as easy as these, if government think proper to reward them. Indeed they do not seem to be playing the fool; for if nothing is recovered, they desire nothing, and of what is actually recovered, only a certain per centage.

 

"' The business of negro hire is yet not conducted in the manner you wish. If, Sir, when I arrive in England, you choose to have any conversation upon this subject, I shall be happy to give you every information in my power. I have been merely a temporary commanding officer here, and have been expecting since October, a senior officer; therefire I did not choose to enter into the minutiae of the yard, which as commander in chief I certainly should have done. I have the honour to be &c.'

 

"The second letter on this subject is without date, and is addressed to the Duke of Richmond, then master general of the ordnance. 'My Lord, The subject of this letter, will, I trust, render all apologies unnecessary for my addressing myself to you. A few days ago, Mr. H. and W., merchants in the Island of Antigua, came to English Harbour, to communicate to his Royal Highnes, and myself, that they were privy to great frauds which had been committed upon government. The ordnance being in your Grace's department, I shall not trouble you with any other, but be as explicit as I am able. As His Royal Highness could not attend to this business, he desired me to make the necessary inquiries, and to take steps as I should think proper. These gentlemen, as will appear by the enclosed letters, are not publishers of this fraud merely for the honour of serving the public; interest has its weight. I send you an account of one quarter's fraud, and I examined several in the books: but they declined my having more, until they were satisfied government would reward them in proportion to the frauds discovered. As a man who has more than once stood forward to detect and bring to punishment those who are guilty of defrauding the public, I may venture to express myself freely. In Antigua, in the different departments, at least they say £300,000.; at St.Lucia, as much; at Barbadoes, not far short;and at Jamaica, upwards of a million.* What of this may be recovered, if any, I know not: however, this good effect it surely will have, that of preventing the like in future.

(* about £1,800,000 ordnance department)

 

" ' Probably by the time your Grace receives this letter, the Boreas will have sailed for England, where I shall ever be ready to give your Grace any information you may wish to received. But there is one observation, which I beg leave to make: it will be said, 'Vouchers are produced, and merchants have attested that they are at the market prices.' In this country the market price is what an article will sell for; and there is no merchant here, but will declare that in signing vouchers for each other, they never look at the articles: saying, a thing is always worth what it will bring: therefore vouchers are, my Lord, no check, in this country. I have the honour to remain, &c.

 

" The third letter, which is also without date, and is addressed to Lord Howe, then first Lord of the Admiralty, varies but little from the preceeding ones: Captain Nelson thought that the subject of his letter was sufficient to authorize him to send it immediately to the first Lord, and not to the board.

 

page 10

 

The one that follows is without any address, dated Boreas, Nevis, May 4th, 1787, and was probably sent to the secretary of the treasury.

 

"' Sir, As frauds in the different departments of governemtn are in a train to be discovered, and that to a very large amount, I have thought it proper to send all the papers and circumstances relative to it at once to you. On the 13th of April, Mr. H. and W., merchants in the Island of Antigua, gave His Royal Highness information that frauds had been committed upon government. Since which time I have endeavoured to make myself master of this subject, and have examined a variety of books and papers - from which it appears that government has been defrauded in a most scandalous and infamous manner. The only emulation I can perceive is - who could cheat most.

 

"' Vouchers have hitherto been deemed a sufficient check in the purchasing of stores, since the market price must be known: the commissioners appointed to examine the public accounts of the kingdom, in their sixth report, were the first who doubted the credit of vouchersw: although that report was founded on army accounts, yet the same chain of reasoning will hold in the naval department abroad; for there is not a merchant in these Islands who does not always sign vouchers whenever they are brought to them: they say there is no fix price for any thing in this country. My informers* have been in various situations in the different Islands, under those employed in the victualling, &c. and they assure me that they are certain they can discover frauds in Antigua, to near £500,000.; St.Lucia £300.000.; Barbadoes, £250.000,; and at Jamaica, £1,000,000.* The sum is immense. Whether they can make it out, time must determine. They are both shrewd, sensible men; and must know they are for ever ruined in this country, if they do not confirm what they have so boldly asserted. I hope, Sir, I am right in sending these papers to you. If I have erred, be pleased to put a favourable construction on my intentions. I assure you, the ardent wish of my heart is to see all defrauders of their country punished." (Making together £2,050,000)

 

June 1787

"When the Boreas sailed for England, in the month of June, 1787, the health of Captain Nelson was in a very precarious state; as appears from the directions which he received from Mr. Young, of the naval hospital. On his arrival in England, his first letter was addressed to his friend, Captain (page 9) Locker, under date 3rd July, 1787; and the first step he seems to have taken after his arrival respecting his proceedings in the West Indies, was an immediate communication with Mr. Pitt; to which, in a few days, the following answer (26 July 1787) was returned from that minister's private secretary, Mr. Smith, dated, 'Downing street, 31st July 1787, - Sir, I am desired by Mr. Pitt to acquaint you that he has received the favour of your letter of the 26th instand; and that the papers, which you have had the goodness to transmit, are now under the consideration of the board of treasury.'

 

16th August 1787

" On the 16th of August, Sir Charles Middleton sent to Sheerness the following encouragement and directions to Captain Nelson, in answer to his previous communication: 'Sir, taking it for granted that the Boreas would have been paid off soon after her arrival, I waited your being in town, to acknowledge the receipt of the accounts you sent me, relative to the naval officer's department at Antigua. As the subject of your letter required much consideration how to act, and at the same time precaution to secure the evidence you had pointed out, I took the opportunity of the packet, then ready to sail, to desire you would use every means in your power to bring forward the evidences; relying on the Navy Board to recompense any services too, as the commissionersw of inquiry were employed, at the time your letter arrived, in invsetigating the business of the navy office, to lay the information before them;and soon afterwards I had a note from Lord Howe, who, I found, had received similar information from you. In this state the business is at present; and you will of course believe,that it will be again taken up on your arrival in town: before which time it may be proper to revolve in your mind what steps may be necessary for bringing forward the evidences. In the letter I sent you, I desired they might be encouraged to write to me, or the navy board, informing us of the evidence they were possessed of, and of their being ready to produce it, on being called on: but in order to make such evidence legal, it will be improper to name any terms: they must submit to the justice of the board. When you arrive in town, I shall hope to see you to substantiate the charge, and which, I have little doubt, is well founded.'

 

August 1787

“The uncertainty in which he was thus kept, was succeeded by a strange and unexpected mortification. If Sir Charles Middleton, in the month of August, had expected that the Boreas, as was customary, would have been paid off soon after her arrival; what were the feelings of her gallant captain and crew, on finding themselves, after their fatigues in the West Indies, kept at the Nore until the 30th November, actually serving as a slop and receiving ship! The former felt this neglect very sensibly; and if it had not been for the kind interference of an officer who stood deservedly high in the confidence of Lord Howe, Captain Nelson, to use the veyr words of a most intimate friend of his, ‘was so dissatisfied with the ill usage he had received, that I am certain, had he possessed the means of living indepentently on shore, he would never have gone to sea again.’ From another respectable authority, it is stated, ‘that whilst he felt so keenly the unpleasant duties that thus were imposed upon him, Nelson seldom or ever quitted his ship, or associated with his brother officers; but was observed to carry on the duty with strict and sullen attention. On the morning when the orders were received to prepare the Boreas for being paid off, he communicated, with much emotion, to the senior officer commanding his Majesty’s ships and vessels in the river Medway, the following extraordinary resolution: ‘I now rejoice at the Boreas being ordered to be paid off, which will release me for every from an ungrateful service, as it is my firm and unalterable determination, never again to set my foot on board a King’s ship. Immediately after my arrival in town, I shall wait on the first Lord of the Admiralty, and resign my commission.’”

 

We have here a captain in the navy, who had exerted himself in the detection of exposure of frauds that had been practised upon the public, kept at the Nore, on his arrival in England, for upwards of four months, and his ship employed as a slop and receiving ship. A stronger proof of a desire to stifle inquiry could not have been manifested. If Lord Howe had felt any wish to bring to punishment the parties who had committed the frauds alluded to by Captain Nelson, it seems reasonable to suppose that immediately upon Captain Nelson’s arrival in England, his Lordship would have sent for him, and consulted upon the most effectual mode of proceeding in the recovery of those over-charges, particularly as they had been committed by agents employed by the naval departments, which were under his Lordship’s control. The determination, however, of Captain Nelson, above mentioned, appears to have had some effect upon his Lordship; as, upon the senior officer in the river Medway communicating to Lord Howe the intentions of Captain Nelson, his Lordship, “on 29th  November, the day before the Boreas paid off” wrote to Captain Nelson a kind letter, “intimating his wish to see him on his arrival in town.”

 

“Captain Nelson accordingly waited upon his Lordship, who received him with much civility, and after some explanations relative to transactions in the West Indies, Lord Howe appeared so perfectly satisfied, that he offered to present him to his Majesty on the first levee day, which was done accordingly. The gracious manner in which he was again received by his Sovereign, awakened that loyalty and zeal, which an injudicious coldness on the part of government had nearly extinguished; and gave him fresh spirits to oppose the malignity of the disappointed Americans, and the clamourous plunderers of the revenue.

 

“Having been informed, by the preceding note from Mr.Pitt’s private secretary, that the whole of the late West India transactions had been referred by the minister to the treasury, he one morning determined to go immediately to Mr. Rose, without any introduction whatever; trusting to the liberality and good sense of a stateman, whose character seemed devoid of that pride and insolence, which weak minds, when in office, too often acquire. The name of Nelson, however, was but little known, or remembered amidst the bustle of public business; and it was necessary for him to retrace the outline and accuracy of his extraordinary capacity, to make his observations valued as they deserved; and Mr. Rose soon found, that he was listening to an officer of no common endowments: ‘I am sorry,’ replied he, ‘Captain Nelson, to be at present so much engaged; but tomorrow I will see you, and at any hour you may please to appoint; only pray let it be an early one.’ ‘It cannot, Sir, be too early for me; six o’clock if you please.’ That hour was accordingly fixed on, and Nelson was punctual to his time. The interesting conversation* that then ensued, lasted from six o’clock until nine: in which, to the utter astonishment of Mr. Rose, Captain Nelson displayed an accurate knowledge of several political subjects, connected with the trade and commerce of his country, that were the least likely to have come under his immediate notice as a naval officer Mr Rose begged him to stay breakfast, and, on his rising afterwards to take his leave, said, ‘I am equally, Sir, convinced of the justice, and astonished at the extreme accuracy of all you have sai: but allow me to add, that this inhterview will prove of little public utility if I am obliged to conceal what I have heard. The only way to make it ultimately useful would be, if you would allow me to lay the whole before Mr. Pitt.’ No objection was made to so flattering a proposal, and Mr. Rose, in consequence, took an early opportunity to convey the information he had received to the chancellor of the exchequer; when Nelson had the additional satisfaction of finding, that the opinions he had delivered were thoroughly approved, and promised to be supported by Mr. Pitt.

 

“He soon after this called on Sir Charles Middleton; and the following note, which is without date, seems to have some reference to this visit. - ‘Captain Nelson returns Sir Charles Middleton’s books, with thanks for the perusal. Captain Nelson can most truly say, that were those instructions in any manner complied with, it would have been impossible that the present charges could have been brought forward. The mind that is callous to the oath relative to the negroes, would not scruple committing any act; and yet, sorry is he to say, it is his firm belief, that every instruction relative to the hire of negroes is broken through. In respect to drawing bills, Captain Nelson never saw any advertisement in the Antigua papers for obtaining the best exchange. It came to his knowledge, in the first bills to which his name was put, on having the command, that two and a half per cent, could be got (it was offered to him by a merchant) more than the exchange written on the bills; and on Captain Nelson’s talking to one of the most communicative of the officers on this subject, he gave as a reason, the Mr.---, in whose favour the bills were drawn, had advanced the money and goods for the use of the yard, before the exchange had risen. These were but bad reasons for his conduct, as Captain Nelson told him at the time, and also added, that in future he should insist on money being advertised for: but difficulties were started; nor was ever any part of those instructions commuicated to him, but such as either militated against the interest of the naval officer, or else he was informed that what he ordered would give additional trouble.

 

“ ‘During the term of Captain Nelson’s command, it may be found that from two and a half per cent, and, in some instances, seven per cent, more was obtained for the navy bills, than was for private ones. He was satisfied with the conscious rectitude of his actions; and only troubles Sir Charles Middleton with this communication, that, if possible, any improper mode of conducting this department may be prevented. The openings for fraud are so numerous, the facility of carrying it on is so easy, and the difficulty of detection so great, it being the interest of all parties to keep the secret, that Captain Nelson fears it will be an arduous thing to find virtue enough to withstand temptation.

 

21st August 1787

On this date George Phillips Towry, Esq. deputy chairman of the victualling board, superintending the store department of that office, reported Mr. Arthur Cuthbert’s store accounts as ready for the decision of the board; a step that is generally taken previous to the passing of the accounts in the cash department.

 

On the 20th January, 1788, Mr Cuthbert died: and on the 28th following, his will, which is sated 3rd July, 1787, with a codicil, dated the 21st of the same month, was proved by the undermentioned executors, viz. -

Alexander Cuthbert, Esq.  - his brother.

George Marsh, Esq. - commissioner of the navy

William Marsh, Esq. - his son-in-law

John Marsh, Esq. - of Bloomsbury

James Morrison, Esq. - of the Tower

 

14th February 1788

The commissioners of inquiry before alluded to, on this date made their 5th report upon the commssioners of the navy; wherein they go into detail of the duties attached to the various departments in the navy office - show the inefficiency of the system for the regular and due examination of the accounts - over which the comptroller was supposed to preside - point out the various duties he had to attend to - by which that superintendance became more nominal than real - and the examination of accounts was in consequence left to clerks; - deprecate the receipt of fees from public accountants - propose the abolition of individual superintendance over departments, but that the board should be divided into three committees - the comptroller to preside at each - and recommended salaries in lieu of fees.

 

17th April 1788

On this date the commissioners of inquiry make their 8th report on the victualling office; wherein they show the inadequacy of the system of individual control over departments, in a variety of instances, as well as in the duties of the commissioners, so far as they related to branches of manufacture, as in the examination and passing of accounts, and collecting of out-standing balances for pursers and sundry persons, which were very considerable - mentions the ease with which extravagant accounts were passed, by the production of false vouchers, on which the clerks relied, provided they appeared regular and in due form - that the entire system of victualling accounts, with all is numerous and subordinate branches and connections, as well foreign as domestic, after passing through many previous checks and forms, finally centered on Londoin, in the two departments of accountant for cash and the accountant for stores - and as to the fees received in this office, they “were not only considerable but exorbatant, and which could not have been given merely for the purpose of accelerating the process of a regular business” - and upon these considerations, and “the chairman of the victualling board being precisely in the same predicament as the comptroller of the navy” - they recommended “That the respective commissioners be exempted forthwith from all superintendance of separate departments.” - “That the chairman should continue to preside over the whole establishment;” and “That the remaining six commissioners be formed into two comimittees, under regulations as nearly correspondent to those recommended for the navy office as the nature of the two services will admit” - the chairman to be a member of and preside at each committee - and particularly recommend a register of all accounts and balance in arrear, and of all accounts passing through the respecitve officers, to be laid constantly on the table of each committee - stating, “we urge the more strenuously this regulation, because we are willing to attribute the immense arrears which still remain due from individuals to be public, to the ignorance of former commissioners that such arrears existed’ - and also the abolition of fees, and the substitution of salaries in lieu thereof - and conclude their report with the following remark upon the case with which extravagant accounts had been passed - “We will dismiss this subject by observing, that as unworthy persons have undoubtedly been protected by individuals high in the station upon this establishment heretofore, so we trust that the abolition of departments will tend, in a considerable degree, to prevent such an abuse in future.”

 

But it is necessary here to observe, that notwithstanding the above instances of neglect and abuse, the commissioners, in the course of their report, speak in terms of high encomium of the zeal, integrity, ability, practical knowledge, and character which have animated many able servants of the crown in this office, and which leaves us no reason to doubt but that every means will be used in future to correct and prevent abuses.”

 

26 April 1788

To return to Clarke and McArthur’s Life of Lord Nelson: it appears that on this date Captain Nelson when at Plymouth sent the following letter, which is without any address; but, as it would appear from the contents, seems to have been written to Messrs.H. and W. in the West Indies. -

“’ Plymouth, April 26,1788; Gentlemen, I have only this moment been honoured with your letter of February 13th, and am surprised that you have not received one from me, dated at the Nore, in September last, more especially as I sent it to Sir Charles Middleton; he having desired me to write to you; stating that a most honourable and liberal confidence might be reposed in him Sir Charles has not only the abilities, but the power of doing more for you than I ever could have; and, I am assured, as much wishes to bring these iniquitous frauds to light. This is his public character; I have not the honour of knowing his private one. Repeartedly I have seen Sir Charles Middleton; and he told me, that every step should be taken; nay, that one of the officers was not likely to go out again to Antigua.

 

“’ Lord How told me, he had consulted with the navy bord, and that they would receive any communication from you, or myself, and would do what was right; and further said, that you were entitled, on making good these representations, to a most liberal reward.

 

“’ From Mr. Pitt, I had an acknowledgment, that the papers were received by him, and had been sent to the different departments. The victualling boad comes under the cognizance of the Admiralty.I don’t recollect whether you gave me any proffs in that department: but I will look when I go to town; and if I have sent any to them, which I did if you gave them to me, I will see the victualling board on the subject. His Grace of Richmond  had not honoured me with any acknowledgment of the receipt of my papers: in other people’s departments he is most rigid for justice; therefore I am the more surprised. I would have you write to him. The sick and hurt fall under cognizance of the Admiralty; yet a letter addressed to that board cannot but be very proper. I shall go to town very shortly, and will call on Sir Charles Middleton; and, if he thinks fit, I shall see your answer to the navy board: at all events I shall desire it. You may rest assured, that no steps shall remain untaken by me to accomplish the discovery and these mal-practices; and to get you the reward, which I have not the least doubt you will so well merit. I must nevertheless apprize you, that my interest in this country is very small: therefore do not build on what I can do for you: indeed little else but my integrity and public spirit can bring such an humble individual as myself into notice: however, the goodness of the cause we are engaged in, will support itself at all times; more especially, I dare say, with such an upright character as Mr. Pitt.

 

“’ His Royal Highness commands me to say, that were he placed in a situation where he could be of any service to this cause, he would most assuredly sift it to the bottom: but that at present not having been from this port since his arrival, he can only give his good wishes for the accomplishment of what you have begun. I am sorry any reason should have arisen, for your suggesting to his Royal Highness your doubts of the propreity of conduct of so high a trust, and important an officer, as you have mentioned. I hope, in this case, you will be mistaken.’ *

(* To whom does Captain Nelson here allude? Can it be Lord Howe, who commanded on the North Americal station in the first American war? Or is it Sir R. Hughes, whom Captain Nelson found in the command of the Jamaica station? We are sorry we are unable to get at the truth of this important fact)

 

“’I am much obiged by your good wishes in respect to myself. All his Majesty’s naval officers would have acted the same upright part, which you are pleased to suppose I should. Any letters addressed, under cover, to Maurice Nelson, Esq. navy office, will find me out: I beg you to be assured, I am your sincere well-wisher, and most faithfull humble servant.’

 

“On his return from Plymouth he passed through town, and, as was his custom, called at the Admiralty; and not obtaining an interview with Lord Howe, sent him the following letter:- ‘My Lord, I have twice since my arrival in town, done myself the honour of calling on your Lordship, in order to pay my personal respects; and to assure you, that as I have always been, so I continue, ever in readiness to undertake any duty, to which the Admiralty may think it proper to appoint me. My zeal for his Majesty’s service is as great as I once flattered myself your Lordship thought it.

 

I have hopes the Admiralty would have ordered me the same allowance, at least, as was given to a junior officer left in the command at Jamaica; and I hope your Lordship will give me countenance in an application for it. I trust it is incontrovertible, that I did my duty with the most rigid exactness; and that the business of the naval yard was never paid more attention to than by myself. The navy board, I am sure, at this moment, are inclined to believe, that the difficulties, said by their officers to be thrown in the way of their duty by me, arose only from my close investigation of their conduct; which prevented their impositions from taking effect. Every artificer and seaman employed in the naval yard receives additional pay; and shall the officer who has the conducting of the whole business be the only one(in this instance) who is neglected? I trust in your Lordship’s answer it will not prove so. The trouble I was at is developing those frauds, it is most true, was no more than my duty; but indeed, my Lord, I little thought that the expenses attending my going so often to St.John’s, a distance of twelve miles, would have fallen upon my pay as Captain of the Boreas.’”

 

1st May 1788

The commissioners of  inquiry on this date made their 9th report upon the naval and victualling departments at foreign or distant parts.

 

This report is exclusively confined to abuses committed at foreign and distant parts - and the commissioners commence their report by recommending a separate establishment at Gibraltar - and pointing out the duties of the respective officers to be employed, observe, "that the expenditure during the last war (first American war) was far greater in proportion to that of the preceeding one; after making every allowance for the large augmentation which arose necessarily from the superior magnitude, extent, and nature of the several services performed" - and as instances of abuse committed during that war, they refer to a letter from Captain Horatio Nelson to Sir Charles Middleton, dated Boeas, Nevis, 2nd May, 1787, "and inclosing an account signed by William Wilkinson and Joseph B. Higgins; whereby it appears that in one instance only of naval stores delivered (at Antigua) between 1st April and 30th June, 1782, amounting in value to £12,357.3s.6½d., the public appear to have been defrauded in no less a sum than £3167.8s.7½d., a profit of 12 per cent., or above £1400., having been first reserved by the seller of those stores."

 

The commissioners quote the above instance of abuse as belonging to the navy department - and say, "the abuses in the victualling department are equally extensive with those subsisting in that of the navy; but as they appear in greater number of instances and in different points of view, it will be necessary to give them a fuller detail."

 

May 1788

At New York (they say) objections have been made to the late agent's accounts to the extent of £47,884.1s.7d. In purchases alleged to have been made by the purser of the London, at Jamaica, on the 9th July, 1782, nine parts in ten consisted of bread - but on inspection of the purser's books, no bread was received on board the London during the period in which those purchases were stated to have been made.

 

They then draw a contrast between the purchases made by the pursers of the Sandwich and London, at Jamaica, and the amount cost of the same provisions at contract prices, and show, that the latter was £12,714.7s.6d. less than the former, which was so much loss to the public: and add - "The instances which occur of a similar nature are numerous to an immense amount, but do not require particular illustration; more especially as we forbear to detail the extent of the loss which the nation may have sustained from such transactions." And these are abuses which the commissioners say they "were enabled  to elucidate with accuracy by papers furnished to them by the Victualling Office."

 

And further - "for the purpose of demonstrating that abuses have not been confined either to particular persons or places" - draw a contrast between the charges made by Mr.. Arthur Cuthbert, agent victualler in the East Indies from 11th May, 1780, tothe 20th November, 1784, and the charges made be Messrs. Michie, Hearne, and King, agent victuallers at the same place, between the 10th November, 1757, and 30th November, 1764; and show an excess of charges in the accounts of the former, of casks, hoops, and bags, to the extent of £43,406.13s.4d.; and thereupon observe - "that of the monies stated to have been extended in purchases by the agent victuallers in the East Indies during the first American war, amounting to more than one million of pounds sterling, a moiety of that sum, upon the most moderate computations, would have been saved to the public if that branch of the service had been conducted with zeal and economy; and notwithstanding a very large proportion of such expense must devolve upon the East India Company, yet it was incumbent upon government, as well for their own interest as that of the Company, to adopt the most effectual and decisive regulationsw for the prevention or correctness of similar practices hereafter."

 

That such "abuses had arisen from the want of a general system, such as should correspond with the service to be performed, we are satisfied that it is vain to multiply such checks as exist at present; they are sufficiently numerous, and must be nugatory, so long as the several parties whose official duty it is to detect abuses, participate in them.' "For these reasons we are of opinion, and recommend, that a commissioner be appointed to reside at Halifax, and likewise at one of the islands in the West Indies, and at Bombay, as also at any other port during actual war, at which a large fleet may be expected to rendezvous."

 

They then state the duties of each commissioner - and wind up their remarks with the following observations: - "In the progress of our inquiry into the several naval establishments, it appeared that most of the abuses of considerable magnitude originated either at sea, or at foreign ports; the instances we have adduced will justify that assertion, and must be considered as specimens of practiceds, which we apprehend it is not the object of our commission minutely toexplore. These instances afford, however, sufficient proof, that persons upon whose integrity the greater confidence has been placed,have abused the trust reposed in them, by participating in frauds which itwas theirduty to have checked and prevented; and that the facitly with which vouchers, certificates, and affidavits are obtained, enabled them to effect their purpose with ease and security. In our reports on the navy and victualling offices in London, we have explained the mode in which these documents are examined and passed, and how much the several officers under those boards rely upon the form and apparent regularity of such vouchers, without duly appreciating their authenticity, or the credit which they deserve; a neglect which we conceive is great measure arises from the difficulties experienced in the detection of frauds, but in a still greater degree from the little success which hath hitherto attended the endeavouring to bring delinquents to punishment."

 

May 1788

It appears from the dates of the respective reports of the commissioners of inquiry above mentioned, that they did not commence their investigation into the victualling office, and the naval and victualling departments at foreign  or distants parts, untill after the death of Mr. Cuthbert; when the cash department of the victualling office, (of which George Cherry. Esq. was the superintending commissioner,) as also the store department, come boldly forward and show, by a comparative statement between the accounts of Mr. Cuthbert and his predecessors, that there was an excess of charge in the accounts of Mr. Cuthbert, (which the store department had reported as correct, and ready for the decission of the board,) to the extent of £43,406. 13s. 4d.!! This proof of their zeal for the public service, Mr. Cherry and Mr. Towry appear to have lost no time in laying before the commissioners of finquiry; indeed Mr. Towry, in his examination by the commissioners of naval revision in May 1807, as hereinafter mentioned, speaking of the pointed animadversions passed upon Mr. Cuthbert's accounts by the commissioners of inquiry, exultingly says, that the commissioners made such remarks, "in consequence of information officially communicated to them through the proper channel." Hence it appears that the store department of the victualling office reported Mr. Cuthbert's store accounts as correct and ready for the decision of the board, which they afterwards showed contained over-charges to the extent of £43,406. 13s. 4d.' that they so reported Mr. Cuthbert's accounts whilst living,  - but that after his death, when, as the old proverb says, 'he could tell no tales,"* they find, to their great satisfaction, that they could bolster up their fame by encomiums passed upon the victualling board by the commissioners of inquiry.

 

(Some time in the year 1788, information was received at Madras of the death of Mr. Arthur Cuthbert, and Mr. Basil Cochrane, who had been an eye-witness to some extraordinary transactions of Mr. Cuthbert, during his agency, feeling desirous to know whether the accounts of Mr. Cuthbert had been passed by the victualling board previous to his death, he called upon Mr. Antonio De Souza, the confidential agent of Mr. Cuthbert. Mr. De Souza informed Mr. Cochrane that Mr. Cuthbert's accounts had not been passed, but nothing was to be apprehended on that accounts, as the whole of the charges contained therein were supported by vouchers, certificate, and orders, drawn up conformably to the rules of the service; and that had any scruples been raised in the minds of the victualling board against passing the accounts, he thought they had been completely removed, as Mr. Cuthbert had informed him, that, since his arrival in England, he had obtained accurate information of the rate of victualling one man, per lunar month, under the management of Mr. George Cherry, the chairman of the board, and who had acted as an agent victualler under Lord Howe, on the North American station, as well of his (Mr. Cherry's) successors, which was much higher than his own; and that he (Mr. Cuthbert) had taken care that the information that was in his possession should be intimated to Mr.Cherry, and that if he (Mr. Cherry) attempted to give him any unnecessary trouble in passing his accounts, he would demand a comparative statement between their respective chargres, as well those accounts that had already been passed in the office. Whether this threat of Mr. Cuthbert had any effect upon Mr. Cherry, we will not presume to conjecture; but it is certain, (as will appear upon reference to Appendix  No.2,) that the accounts of Mr. Cherry's successors in the agency remained unpassed in the month of December 1806, upwards of seven years after he had quitted the board, although they had been reported as ready for the board's decision by July 1788)

 

Of Mr. Cuthbert's accounts the commissioners of inquiry say, that had he conducted the agency with zeal and economy, a moiety of his disbursements (or upwards of £500,000.) might have been saved to the public.

 

Now surely, after such a disclosure, and after the heads of the cash and store departments were so zealous in pointing out the excess of charge in Mr. Cuthbert's accounts, it became the indispensable duty of Mr. George Cherry, and Mr. George Phillips Towry, to have immediately caused an inquiry to be made into the rea extent of the over-charges in those accounts, and, if possible, have recovered the same from his estate: indeed they ought, under these circumstances, to have sent the whole of Mr. Cuthbert's accounts to the court of directors of the East India Company, with a request that they would transmit the same to the respective presidencies in India, where the disbursements were made, in order to be examined into, and which the Company's auditors could easily have accomplished, the Company having had to purchase the same articles for the use of their troops and marines, and consequently the rates charged in the garrison store-keepers' accounts, which had been passed by the auditors, would be the best principle to act upon, and thus the amount of the over-charges would have been clearly ascertained. But their purposes appear to have been answered by the encomiums which the commissioners of inquiry so freely bestowed, - and whcih seem to have so intoxicated them, that they lost sight of this most material part of their public duty.

 

There may, however, have been some reason for this omission. The commissioners of inquiry also say, that such "abuses have not been confined either to particular persons or places." Mr. George Cherry was himself an agent victualler; and it may not be out of the reach of probability to suppose, that he imagined that if he took any further steps with regard to Mr. Cuthbert's accounts, he might be called upon to produce this own, and a comparative statement be demanded by Mr. Cuthbert's executors, and which accounts, it seems, were not more moderate than those of Mr. Cuthbert. Indeed, we are rather surprised that Mr. Cherry, in his zeal for the public service, did not produce his own accounts to the commissioners of inquiry, to show what a correct servant of the public he had been; and if he had done so, we should most heartily have joined in the praise bestowed upon him by those commissioners: but looking at the secrecy that was observed with regard to his own accounts, and the readiness with which he exposed those of Mr. Cuthbert, after his death, we are inclined to contemplate those encomiums with much suspicion.

 

The article continues for over 300 pages plus Appendix.  Search on Google books for the full version.

 

(Return to biography of Arthur Cuthbert)

 

 

The information on this website is copyright JJ Heath-Caldwell.  Should you wish to copy any of this information for commercial purposes, please contact JJ Heath-Caldwell.

(Home)  (Biographies)  (Bookplates)  (Contact)