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Welfare Fraud Incident
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Herbert Salisbury
People and Places
Written for Mrs. Karen Salisbury
By Mr. Delmas Saunders

The folk who got up early on a May morning in 1935 for a trip to Prestonsburg to apply for vouchers with which to purchase food and clothing for the family were surprised to find the office of the Kentucky Emergency Relief Administration had burned during the night.  The dwelling formerly occupied by the Simmon’s-Stephens family, that housed the offices of the Floyd County relief organization had burned to the ground.

A day or so earlier the word was out that an investigation by authorities had revealed there was wide spread fraud in the issuing of vouchers to the poor and needy.  The burning of the office was an effort to destroy the records of fraudulent payment to fictitious and deceased persons.  The arsonists did not realize that duplicate copies of the incriminating records were in the Louisville headquarters of the Welfare agency.

The agency sent a representative, Sarah Hays to Prestonsburg immediately who fired every person working in the Floyd County Program except Lilly Hatcher Parker, the only employee the investigators could not find evidence of any wrong doing.  Mrs. Hays hired a complete new group of clerks, secretaries, and social workers.  Within a week or so Mrs. Hays had the Prestonsburg office open in new quarters and issuing commodities and vouchers for food and clothing to the poor and needy of Floyd County.

The County Judge, the County Fiscal Court members, the Mayor of Prestonsburg and possibly the City Council members were, prior to the destruction of the office and its contents by fire, a board of directors, so to speak, who approved the hiring of all employees involved in administering the program.

As I recall there were over forty individuals who were indicted by the Federal Grand Jury.  Some of those indicted confessed to built and the balance were convicted in Federal Curt that at that time convened in Catlettsburg, KY.  I am writing this from memory and I do not remember the names of all the persons involved.  I believe there were at least three persons in the Salisbury family who were involved, tried and convicted and served sentences in the Atlanta. Georgia penitentiary.  Herbert Salisbury was, as I recall, in charge of the distribution of commodities (cheese, flour, grapefruit, luncheon meat, cured slabs of bacon).  I did not see the evidence but it was common knowledge that, on the day following the burning of the office, fishermen found large quantities of cheese and slabs of bacon on the river band and five pound blocks of cheese as well behind Herbert’s house that he had stored in a small building near the edge of the riverbank near his home.

Herbert’s brother-in-law, Harry Sandige, was, I believe, a social worker.  Social workers made recommendations for issuing vouchers to welfare recipients.  Separate vouchers were issued for food and clothing.  The social worker would sell a voucher to a merchant for, example, a face value of $20.00.  The merchant would pay the social worker $10.00, fill out a description of $20.00 worth of food or clothing on the back of the voucher and mail it into the Louisville office of The Kentucky Emergency Relief Administration, and in a matter of days received a check for $20.00, the face value of the voucher.  He was $10.00 richer and had only spent the price of a two-cent stamp.

Fill in another brother-in-law of Herbert’s named Curtis May, in place of the merchant and you can picture Curtis May’s involvement in the scheme.

The Social Workers and merchants were the persons who handled the cash and they had to share it with the county and city officials involved and who I believe were the instigators of the fraudulent scheme.

You may wonder how I know so much about this affair.  I was one of the new persons hired by Sarah Hayes.  So was Edna Banke the girl I first met in the new office who was an unemployed schoolteacher at the time.  Edna, two and one half years later, and I were married Jan. 15, 1938.  The Postal Inspector who dug up all the evidence that convicted the persons involved, Walter Ferrell, Kenova, W.VA resident in retirement, was an uncle of my brother-in-law Ed Ferrell who married my sister Chloe.  Walter, many years ago, told me the story of his involvement in the case.

If I can find a copy of a letter I wrote to the Floyd County Times last year or the year before defending Curtis May who had been wrongfully accused as the perpetrator of the crime, I will enclose a copy.

Yours very truly,
Delmas Saunders
Sept. 18, 1999

Floyd County Times
12 May 1995

Commodity fraud letter treated duo unfairly.

I was shocked to discover your publishing of Lloyd Goble’s letter relating to the fraudulent distribution of commodities in Floyd County during the Great Depression of the 1930s.

The problem I have with his letter is not with the fraudulent acts but his mentioning the names of only two persons as the perpetrators.  There were dozens of people involved, many of whom were indicted, tried and convicted and who served time in federal prisons.

Mr. Goble’s letter only mentions two people.  Had you or your staff searched your files, you would have found that your predecessor, Norman Allen, fairly reported the trial and conviction of the persons involved in this shameful and terrible crime.

Those involved included county and city officials, numerous merchants, as well as local employees of the The Kentucky Emergency Relief Administration.

It is true that Walk Stumbo and Curtis May were among those tried and convicted, but in singling out only these two men in his letter, Lloyd Goble has, in a very real sense, treated them unfairly, if not grievously.

I was not personally acquainted with Walk Stumbo, but I knew Curtis May quite well.  I was born in 1913 and I have known him since childhood.  To my knowledge, his involvement in the Relief Scandal of the thirties was the only transgression he ever made in his life.

 

Curtis May was a benevolent person.  He was a kind person.  Curtis May had the reputation of being a man who never turned away any person seeking food from his store or his door.

 

Curtis May did wrong.  Her served his time.  He came home and re-established his business, served his God faithfully, was a decent and respected citizen of Prestonsburg, Kentucky.
Delmas Saunders
Prestonsburg

A personal note from Mr. Saunders
Incidentally, the same remarks I made about Curtis May, other than the never turning away from his store or door a person asking for food, apply to Herbert Salisbury.  He died at peace with mankind and his Lord.

Delmas Saunders
9/18/99