The New York Times/1894/02/11/John A. Morris, Lottery King

John A. Morris, Lottery King. History Of The Great Louisiana Gambling Concern. Florida Had Best Beware Before Giving Him a Foothold. Within Its Borders. How He Obtained Control of the Greatest Incorporated Swindle that Ever Disgraced a State, Millions of Profit on a Hundred-Thousand-Dollar Investment. New-Orleans, Louisiana; February 10, 1894. On the last day of 1893 the Louisiana Lottery, as a chartered corporation of this State, died. Nominally this blotch on the State has been removed from the United States to carry on its disreputable work and exert its baleful influences in one of the Central American States. Its removal, unfortunately, is but nominal, for John A. Morris of New-York, New-Orleans, Maryland, and Texas, the actual head of the concern since its inception, has simply lifted the curse, with all its influences for evil, across the Gulf of Mexico and planted it on the western shore of that charming "Land of Flowers," Florida. John A. Morris knows too well how good a thing for the pockets of an unscrupulous man the lottery is. He knows, too, how rapacious are the political Governors of a Central American State, and how they would force him to disgorge the major part of his enormous profits if he would carry on his nefarious business under their protection. So, banished from this State, refused a harbor in at least two of the extreme Western States, and even denied a local habitation in Hawaii, Morris has pounced upon Florida. There he and his crew, despite the laws of the State and the Union, and in defiance of the wishes of the decent people of Florida and of the United States, will try to get a resting place for the disreputable concern, and carry on there the work of corruption and ruin that marked the history of the gambling concern in this State. A sketch of how this corporation made Louisiana its plaything for a quarter of a century, and coerced men of hitherto good repute into becoming its menials, will be interesting Just at this time as a horoscope of what the future will certainly have in store for the people of Florida, unless they at once cut out the sore that has appeared at Port Tampa. A marvel among chartered swindles is the Louisiana Lottery. The Mississippi Company conceived by the canny Scotchman, John Law, which was a wonder as a swindle in its days, was as nothing compared to the concern that got its fangs on this State and city during the "flush times" in Louisiana politics, the period from 1865 to 1876. It corrupted courts, both State and national, the Church, the financial and commercial institutions of the city, and bought Legislatures and office holders, national, State, and municipal, just as slaves were once sold in the marts here, and all to what end? To the enrichment of John A. Morris and about a half dozen of his associates, some of whom had been reputable citizens until they felt the touch of his contaminating hand. The presumable creator of the Louisiana Lottery was one Charles Tilghman Howard, who claimed to be of good birth, and a cadet of the once great family of Howards of Maryland, who came hither from Norfolk in England years ago. Howard's right to claim this sort of lineage is based on his own statement, but nothing more is known in this city than the way in which he first appeared here. John A. Morris had for years been supposed to be a descendant of the Morris family of which Gov. Morris and Lewis Morris, the latter one of the signers of the Declaration of Independence, and the former a famous Senator, were members, until some busy investigator discovered that he was not allied to them, but came of grosser stock. Whatever may have been the cause of Howard's coming, why or when he came, does not fully appear. Nor is it of special moment in this connection. He was here before the war, it is claimed, as a seller of lottery tickets. After the war he established himself nominally as a bookseller and stationer. He was, however, a typical chevalier d'industrie, and his nominal business was but a cloak for his regular business, the sale of lottery tickets for concerns in Kentucky, New-York, and Havana. It was a fertile field he had planted him-self in, and when he saw with what avidity the freedmen and the whites of the Latin race indulged in gambling, he decided that here was the place for a lottery of all places on earth. He had but a local affair in mind. But even to establish that he lacked money. Full of his scheme and its possibilities, he went to New-York City, and there met Zachariah Ephraim Simmons, variously known as "Zach" or "Eph" by gamblers of those days. Simmons was one of the Trustees of the lottery trust organized in 1803 to control the lottery and policy business of the country, and known as C. H. Murray & Co. John A. Morris was the residuary legatee of Simmons, according to the agreement signed by the parties to the trust thirty years ago last September. It is possible he was the principal. He was such in the Louisiana Lottery from its inception, but took good care that no one should know of it. He was socially ambitious. and masqueraded here as a gentleman of wealth and leisure until such time as his concern was sanctioned by the constitutional law of the State. It was through Howard's attempt to get C. H. Murray & Co. to indorse and furnish capital for his swindle that he met Morris, and the two formed the partnership to debauch the State in such fashion as no political division of the earth was ever before debauched. After Howard had unfolded his plans to the lottery trust, John A. Morris went to New-Orleans to look over the ground. He found Howard a shrewd, sharp man of his type, with an unusual degree of business capacity added thereto. A union of forces was decided on, and Morris is said to have advanced $100,000 of his own money for a greater interest than his partners of the lottery trust were willing to risk. That money was used to buy the Legislature of the State and thus secure a charter. That Legislature of 1867 was about the most corrupt the State was ever cursed with. It was made up mainly of negroes, one-half the body, a majority of which was Republican, being composed of enfranchised slaves. Their moral sense was as completely dulled then as that of men of birth and education later became under the manipulation of Morris and Howard. As a stranger in the State, Morris remained in the background, and so the fiction has ever existed that it was Charles T. Howard who was responsible for the infliction of the Louisiana Lottery on the State. Without Morris's money he would, however, have been helpless. A ring of a half dozen white carpet-baggers, at the head of which was one "Al" Harris, was formed as a lobby. They openly bought the necessary number of votes to secure the charter. Gov. Warmoth vetoed the measure, and it was then promptly passed over the veto. This was the step that led the lottery people to have Warmoth impeached and succeeded four years later by Pinchback, a scheming negro, who was one of the largest holders of lottery stock outside the Morris-Howard party, which owned and controlled more than one-half of it. The concern was capitalized at $1,000,000, and was exempted from all taxation because it agreed to pay the mere bagatelle of $40,000 yearly to the educational fund of the State. This is the only direct tax ever paid the State on a business that ran from $20,000,000 to $28,000,000 a year for the main lottery. Indirectly it was, of course, a gold mine from which State and municipal officers drew whatever, and whenever, they wanted so long as they were of use to Morris and protected his monopoly from competitors. As the representative of Morris, this man Howard used money when and where he would and without stint, so long as he was the managing director of the concern. He figured as its President up to the time he was thrown from his carriage and killed at his country seat, up the Hudson, some eight years ago. The handsomest building in New-Orleans, the "Howard Memorial," a fine public library, was erected in his memory. Of this building one writer has very truly said: "It is the single unselfish memorial that lottery money has conferred on New-Orleans." Howard's other memorial is the beautiful cemetery where stands a monument to his memory, greeted by the children to whom he was, it must be said, a good father. Howard once applied to the jockey club, of which his partner, Morris, was an honored member, for membership. He was blackballed by the proud Southrons and Creoles who had not yet been made slaves by handling the lottery money, and who did not suspect John A. Morris of being Howard's partner in the lottery. "Black-balled me, have they?" said Howard, when the news was brought him, ac-cording to the story told by the late Capt. Conner of the St. James Hotel, in New-York City, and then connected with the jockey club. "I never forgive an insult; I'll turn their — racetrack into a cemetery.", he did it. There he lies buried today. As soon as the charter for the lottery was obtained, Morris began scheming to get possession of the lion's share of it, and this he did speedily. Less than two weeks after the scheme was bought through the Legislature, the charter was assigned, with all its rights and privileges, to John A. Morris, Z. E. Simmons, and C. H. Murray. Later Howard, in accordance with a previous understanding, was given a fifth interest in the concern, and the curse to the city and State was launched as the property of Howard, Simmons & Co. When it began to pour a stream of gold into the pockets of its owners, Morris in some way "froze out" all his partners except Howard. The story of how he did it is buried in the grave or Charles T. Howard and in the bosom of John A. Morris. Morris is supposed to have obtained possession of more than one-half the stock of the concern before, in 1871, it had become a mine richer than Golconda, a fountain of wealth to which that of Monte Cristo was but a mere bagatelle. Since then he has acquitted all that he could buy at any price, and its shares were more valuable at one time than those of any other concern in America. The stock of the Chemical Bank in New-York City is alone in having been quoted as high, possibly higher, in the market. The ruling price here for years was $1,400 a share for one-hundred-dollar shares, and none was to be had at that figure, so that the quotation was merely nominal. As the concern has paid as high as 170 per cent in dividends annually, and has averaged 80 per cent. during the twenty-four years of its existence, the quotation was even below its actual worth. But 1,700 per cent would more nearly represent the actual yearly dividends to John A. Morris and to Howard while he lived. Their profits under the arrangement by which they secured the assignment of the lottery to themselves from a concern-in which they were the principal owners was favorable beyond the dreams of avarice. C. T. Howard & Co. became sole owners, with Howard as the " managing partner " of John A. Morris. who still wore the mask of respectability and kept under cover. But over the building where the concern was situated he flew to the breeze his blood-red "barbarity colors " — those which are now his racing colors, emblazoning on them his creed: "Every man is at heart a gambler and every man has his price." That has been the motto of the Morris crest, is now, and always will be, judging from the re-cent attempt at a political career by his son, Alfred Hennen Morris, in New-York State. Financially, it has been a good creed, for it has won for Morris a fortune conservatively estimated at $25,000,000, and which some say may be fully double that amount. The way in which Morris froze his fellow gamblers out of the Louisiana Lottery gave rise to the institution of a considerable number of suits against him in his corporate name. To stave them off he had recourse to the golden flood that poured into the lottery coffers. Litigants were bought off just as adverse legislation was crushed, one conversant with the affairs of the concern asserting that over $300,000 was paid to members of the Legislature for bribes to kill such legislation. What litigants were paid is a sealed book, but it reached over a million. Morris and Howard agreed with the minority stockholders to run the concern for one-half the profits and divide the other half between the shareholders, after all the running expenses were paid and a snug sum set aside each year as a reserve, or fund for corruption purposes. This latter sum was kept constantly at about $500,000, so it is said, though this has never been certainly known. Morris demanded from his stock-holders absolute freedom from investigation of any kind into the affairs of the concern, and each signed a release to that effect when he drew his dividends. A petty lottery with daily drawings, and so a policy attachment, very like the "free field" annex to his race-track scheme in Westchester County, New York, was adopted. That was Morris and Howard's private property. It paid all the expenses of the monthly lottery scheme, and left a handsome margin of profit, for New-Orleans and Louisiana became lottery-mad, and men, women, and children paid their pennies to help fill the pockets of John A. Morris. As this petty annex paid all the bills for the big concern, Morris and Howard got not only the dividends on the stock they held, on which dividends were paid, but presumably the entire half of the profits which were set aside for them before the shareholders came in, and all the money which was charged to what was unquestionably the most liberal expense account that was ever charged up on the books of a chartered corporation. This was the scheme which was run while the lottery was in existence here, and which will be in existence in Florida and Honduras or wherever this money-eating devil fish may find a holding place for its far-reaching and everlastingly clinging tentacles. A monthly drawing ten months in the year, with a capital prize of $300,000, and a capital prize of $600,000 for the other two months. A total of 100,000 tickets issued each month at $20 a ticket, save on the two months when the capital prize was doubled, when the tickets were made $40 each. These tickets were subdivided into twentieths, so that the poorest could be drawn into the game. The very poor were especially to be catered to, for it is from these patrons of pawnshops and frequenters of charity organizations all over the country that John A. Morris has drawn his millions. If each ticket was sold in all its portions the lottery would receive $2,000,000 in cash ten months in the year, and $4,000,000 on each of the other two months. Assuming a fair drawing and a fair distribution of the prizes advertised to be drawn, the concern would pay out 52 per cent. of its receipts, or $1,054,600, every ten months, and $2,109,200 the other two months. Total receipts, $28,000,000; total payments, $14,764,400; total profits, $13,235,000. That would look like a fair enough return for an original investment of $100,000 by John A. Morris, under the terms of the peculiar contract he held. But all the tickets were not sold in any one month — rarely, if ever. So there was a little joker devised which was sure to keep the ratio of profits up to the standard of 48 per cent. of profit on the face of the scheme. Such tickets or portions of tickets as were not sold were held by Morris & Howard as their share of the possibility of the prize drawings. Hundreds and probably thousands of the prize-winning tickets were held in whole or in part by Morris & Howard as competitors against the poor devils who had bought the gayly-colored bits of paper at $1 or $2 the bit, according to the value of the capital prize. All this was clear gain to Morris. There is believed to be no record of the whole of any capital prize being paid to any person or sets of persons since the lottery was inaugurated twenty-four years ago. Here and there all over the country persons were known to have drawn twentieths. or occasionally tenths of the prize, and whenever the holder of such tickets could be found, Morris had the fact advertised as widely as possible, so long as he was permitted to advertise in the press of the country and play on the cupidity of the masses of the country through the mails. Morris wanted at least a part of the capital prize drawn. It was the best possible advertisement for his swindle. So there was no necessity for fraud in the drawing. An honest draw-ins, better served his purpose. Even the sending of the entire capital prize to some one person would pay ultimately. It is stated as a fact, however, that the Morris gang always had a string tied to the capital. and most of the other prizes in the unsold fractions of tickets, and that no ticket was sold in its entirety if it could be helped during the existence of the lottery here. This can the more readily be believed when the scheme involved the sale of 2,000,000 tickets instead of 100,000, as each of the latter was cut into twenty parts. The reason was that if a gambler was going to invest $20 in lottery tickets he would rather have twenty chances to draw a part of the capital prize than one chance in 100,000 to draw the whole of it. The result was that Morris had a certain chance of keeping for his own pocket a portion of every prize, large or small, and that was the plan that was pursued with success and to certain profit. Thus The New-York Times first gives to the public the real reason for the division of the scheme of lottery tickets into twentieths. This has been in itself a source of a certain income of probably a couple of million dollars a year. And Morris, by his shrewd scheme of dividing profits with his share-holders, got all this surplus. For this source of phenomenal money getting without entailing a single cent of risk, Morris paid to Louisiana the beggarly sum of $40,000 a year not a tithe of the sum the people of this city, with its annual list of thousands of delinquent taxpayers — all of whom bought lottery tickets — paid into John A. Morris's pockets. Is it to be wondered at that he willingly offered to pay to Louisiana $1,250,000 annually for a renewal of the charter for such a money-making concern as this? That people here who happened to own stock should took with favor on the scheme is hardly strange, for it appears from one of the many suits brought against Morris that. $3,400,000 was divided among the stockholders in 1889 as their half of the profits. This after Morris had taken his 50 per cent. commissions to ticket agents had been paid. and contributions made to the campaign funds of all political parties, shareholders taxed enormous sums for salaries, the bribery fund fattened, the National, State, county, and city officials paid their monthly allowances, advertising bills paid, and the newspaper proprietors, editors, and reporters that were allowed to feed at the Lottery crib had all got their fill. There was a confessed profit of $6,800,000 in that one year, and one familiar with lottery affairs asserts that the unconfessed profit witch fully as much more, including, of course, the undivided share of the prize-drawing tickets that were held in the treasury of John A. Morris, assignee of the Louisiana Lottery Company and owner of its charter. So far as can be learned, Morris is to pay Florida nothing at all save what he undoubtedly paid the last Legislature for the change of the lottery laws for the planting of his million-producing scheme. It is now wholly his own property, as with the death of the Louisiana Lottery here there also passed out of existence all obligations to divide his spoils with any person on earth. From what is known of Morris here there is no danger of his offering to divide, except when it comes to bribing the newspapers and lawmakers of the State. Early in the career of his gigantic swindle, Morris and his figurehead, Charles T. Howard, had recognized the necessity of having persons superintend the lottery's month-13r drawings whose names should be a guarantee for their honest management. Howard is credited with having conceived the idea of getting a prominent general officer of the Union Army in the late war and one from the Confederate Army to take charge jointly of the monthly drawings and see that they were conducted fairly. He tried to get a Union officer first; but although he at first offered a salary of $15,000 per year, which was later increased to $30,000, and the person need to be in New-Orleans but five days of each month, the right man could not be found. Howard wanted an ex-corps commander, are least. Gen. Rosecrans was tried; then Gen. Don Carlos Buell, and half a dozen others. But the man who would fill the bill was never found. They frankly said they would not have their names and memories connected with an institution concerning which all respectable people had but one opinion, the Northern General feature of the matter was relinquished. Gen. G. T. Beauregard was a creole. Like so many of his blood, he did not object to lotteries per se. He speciously argued that, if properly conducted, the lottery and policy scheme might add to the wealth of the city and State. So, with the understanding that he should be allowed to choose his associate, he agreed to take charge of the lottery drawings, under a condition that he and his associate were not to be interfered with by the President of the company or by the autocrat of the concern, John A. Morris. If any sign of fraud were discovered, the two directors of the drawings, Gen. Beauregard and Gen. Jubal A. Early, whom the former chose as his associate, were clothed with authority to stop the drawings at once. report the matter to the Attorney General, and proceed to criminally prosecute the offenders. As has been shown, it was business policy to have the drawings conducted with fair-ness, so as to better advertise the thing. But even if there was reason for a crooked drawing, there was no chance of detecting it. Even had there been, the fact that Morris paid the two Generals an annual salary variously reported at from $20,000 to $30,000. they were men who would not throw overboard, so good a thing as a means of existence by taking the action they were empowered to take. But as Morris never had even one cent at risk in the :affair after the return in one year of his original one-hundred-thousand-dollar investment, there was no reason for fraud and probably none was attempted, at least after 1871, when the dividend reached 48 per cent. The Beauregard-Early investment was a good one for the lottery, for within three months after they took charge the sales of tickets in the Southern States were doubled. It was a further fortunate investment for the lottery that it had Gen. Beauregard in its interest when it made its successful at-tempt to have its charter incorporated in the State's new Constitution, and so brought the crowning shame to this State. This atrocious proposition crystallized all the elements of opposition to the lottery that for years had been growing in strength and power in the city and State. Finally, when, in 1879, the company's charter was actually repealed, its enemies leaped into the breach. The churches — except the Roman Catholic — were nominally against it, and fighting it, some actively, but most listlessly, for the ministry had been contaminated in many instances by the lottery contributions 'to church charities and building funds. It seemed that the opposition would be triumphant, and that the colossal fraud, with all its money and influence, must at last go down. Then it was that Gem Beau-regard's influence was most effective. Morris sent him to Baton Rouge, the capital, and there he worked with might and main. Morris's money and Beauregard's influence were powerful with the creole members of the Legislature. He changed many of them from active enemies of the concern to its supporters. When all seemed lost and the charter was actually repealed, Morris, through Howard, played his last and strongest card. And therein is a most interesting story. In 1877, when President Hayes sent down a committee of four leading Northern Republicans and one Southern Democrat to break up the Packard. or Republican, Legislature, and install the Democratic Government In power In its stead, agreeable to a pledge he had given certain Southern men in and out of Congress when they allowed him to be installed as President, the scheme of dissolution included the payment of the salaries and mileage of the Republicans lawfully elected who would leave the Packard Legislature and go over to the Nicholls Legislature, until a majority of those declared elected by the Returning Board should be in the latter body. This was the plan by which the Republican Legislature of a State was to be broken up, whose forged Electoral vote had been counted for Hayes. About fifty of these members from both branches of the Packard Legislature were wanted to make the Democratic body safe. The President had promised to "recognize" it as soon as this should be had. A. sufficient number were found who would go over for their pay and mileage. but they must have both assured before they entered the Democratic hall. They were nearly starved out, for Packard could not give them a penny. The Democrats wore him out by a long siege. The money, in cash, had to be got in an hour. Gov. Nicholls could not raise it in so short a time. The sum was large, for over $1,000 was due each of the members from the Packard body, to say nothing of whets was to be paid the Clerks of the Republican Legislature, who had the legal journals of proceedings. It was 11 o'clock April 7, 1877. At noon the sometimes bloody drama that had been going on since Nov. 4, 1876—election day—would be ended, if the needed money could be had. The Democratic leaders looked at each other with pallid faces. They had made no money provision, for so sudden a conclusion of their troubles was unexpected, though they must have known the money would be needed soon. But this was Nicholls's way. He was always too slow. "Let us try Mr. Howard," said Lieut. Gov. L. A. Wiltz, a creole of about thirty, with the quick wit and readiness of expedient of his French blood. Wiltz stated the case to Howard while the others listened. "The safety of the State is at stake," said Lieut. Gov. Wiltz. " You can save it, Mr. Howard, if you will, but you must act quickly." "How will I get my money back?" Howard asked. It was 11:15. Time was everything. No one answered this very pertinent question. To hand over the vast sum in cash necessary to save the State without some guarantee that it would be returned was rather too much to ask of even the staunchest patriot. Yet the gambler was ready. " If you gentlemen will prepare and sign a statement reciting the circumstances of your visit to me to-day, its purpose, and my reply, I will give the State the money necessary to its salvation," Howard said. Fifteen minutes later Morris packed $65,000 in five and ten-dollar bills in three traveling bags, and placed them in the hands of the Clerks and Sergeant at Arms of the Nicholls Legislature. Each member of the Packard body was shown the money as he came. and when he had been sworn in, he went and got his pay. By night the Republican Party of Louisiana was dead. Its Governor, elected when Mr. Hayes was, but running 2,000 votes ahead of him, was a fugitive from the State- The President recognized the Nicholls Government that night. The "visiting statesmen" left for Washington. Their work was done. John A. Morris held the State prostrate and at his mercy. His man Howard had done him the best turn of his career. When. two years later, at Baton Rouge, it seemed again as if the lottery monopoly was beaten, Morris played his trump card. He still had the writing, given Howard by the Democratic committee, which got the money it had to have. This communication he caused to be read in the legislative caucus that was to settle the lottery company's assets, his money has never been returned to Mr. Howard," said Lieut. Gov. Wiltz, after reciting the circumstances under which it had been obtained. "I was one of those who sold the State's honor to get it. There would be no Democratic Governor or Legislature hero to-night but for that money. Will you ruin the men who saved us the State? I will never be a party to any such act." Wiltz was a good talker, young, handsome, and full of magnetism. He felt that his personal honor and reputation were at stake in the matter. His speech turned the scale. The lottery company's charter went into the Constitution of the State. The worst blow the lottery ever received prior to that which wiped it out of existence in spite of its proffered annual bribe to the State of $1,250,000, was when Postmaster General Wanamaker prohibited it from circulating its printed matter through the mails. This was a terrific blow to the local Post Office as well, for in the last year that business was transacted through the mail the lottery company received nearly $20,000,000 in postal notes, money orders, and registered letters. The Louisiana Lottery is in liquidation, and its shareholders will receive about $700 for $1 in the distribution, it is said, Morris, as the known holder of 4,200 shares and the trustee of Howard's 2,000 shares. getting the lion's share. The Honduras-Florida Lottery takes its place, with .Morris as the only holder of stock, except such shares as he shall pre-sent to politicians, newspaper owners, and such others as will help him to keep his scheme afloat in Florida. That the stock will be placed judiciously, every one who knows Morris knows perfectly well. In Florida, thanks to the kindliness of the last Legislature in changing the laws of the State will be situated the John A. Morris Kindergarten and University of Gambling. It will stay there if money will buy a foothold for it, for John A. Morris is prodigally liberal with lottery money if he knows every dollar expended will bring back two or more, or will silence opposition that is feared. His main ambition now is to get once more the right to use the mails. To this end he will bend all his marvelous and wholly unscrupulous energies. His lawyers have advised him that the anti-lottery post-al law is absolutely unconstitutional, because it is an interference with State and personal rights guaranteed by the Constitution. On this ground he is preparing to make the most vigorous fight of his life. All the masks are now removed, and John A. Morris as the Lottery King stands revealed in all his disreputableness. Florida had best beware before clasping him to her bosom.