that corrected declarations be filed showing the quantity of this foreign grain actually loaded on board the vessel. Please advise us as soon as possible your decision concerning this matter and how we are to proceed with the amendment of the declaration, which the Customs must have done since the declarations as now filed are not correct and could be classified as fraudulent. It is signed Very truly yours, STONE FORWARDING CO., Mr. MOSKOVITZ. That referred, if you will recall from the reports of your investigators, to a shipment made by Bunge Corp. on wheat that they bought from the Ulhmann Grain Co., f. o. b. steamer? Mr. BACHMANN. Yes, sir. Mr. MOSKOVITZ. And f. o. b. steamer means when you buy from an interior elevator? Mr. BACHMANN. My interpretation of on-board is that Mr. MOSKOVITZ. In other words, you buy a wheat from an elevator and you take title to it when it goes on board so it is wheat of Ulhmann Elevators from the time it leaves the elevator or wherever they have it to the time it gets on board. Mr. BACHMANN. That is right. Mr. MOSKOVITZ. And from that time on the Bunge Corp. takes title? Mr. BACHMANN. Yes. Mr. MOSKOVITZ. The only people concerned in the purchase and sale are the Ulhmann Elevator people who have title to it until it gets on board? Mr. BACHMANN. Yes. Mr. MOSKOVITZ. And then at that time, it becomes the wheat of the Bunge Corp.? Mr. BACHMANN. Yes. Mr. MOSKOVITZ. And from this letter, do you understand, as I do, that somebody broke a seal on some bonded wheat and put that in that shipment instead of the wheat that came from Ulhmann Elevator? Mr. BACHMANN. No; that is not my understanding of it. There were any number of in-bond shipments in the Houston area and it got on ships that went out under the International Wheat Agreement. Mr. MOSKOVITZ. I am talking about the Bunge Corp., what happened to the other exporters, I am not concerned with. But, the Senator will get that from the other exporters-that you have casually described this transaction at the beginning, and I want to get the detailed facts in the record. Will you please answer the question? Mr. BACHMANN. That was Bunge Corp., whether it was with any other company, that was the Bunge Corp., whether it was with any other Bunge shipments or not. Mr. MOSKOVITZ. I am talking about the 5,000 bushels of Canada wheat on the steamship Poly Trader in connection with a purchase of that was made by the Bunge Corp. from the Uhlmann Elevator, f. o. b. steamer. grain Mr. BACHMANN. My point is this, Mr. Moskovitz, if that is Canadian wheat and subsidies were claimed, there was 5,000 Canadian bushels of wheat on there on which subsidy was paid and I think improperly. It may have been entirely innocent. Mr. MOSKOVITZ. Isn't that the case in this situation? Mr. BACHMANN. I don't know. Mr. MOSKOVITZ. Did he so inform you? Mr. BACHMANN. I don't believe so. Mr. MOSKOVITZ. Will you read the reply to that letter from Bunge Corp., to the Stone Forwarding Co., dated September 11, 1951? Mr. BACHMANN. Yes. This is to the Stone Forwarding Co., Houston, Tex., to the attention of Herman F. Webber. Re steamship Poly Trader, our reference 51-1175, reading as follows: We have before us your favor of September 5, under the above heading and no doubt you can readily understand that we certainly do not wish to have a controversy with the United States Customs, neither, of course, do we wish to have filed a fraudulent return, and of course beyond everything, we do not wish at any time in the future that the Customs could think by reading the records that Bunge Corp. or you on behalf of Bunge Corp. should have filed a fraudulent return. Whereas from the contents of your letter it seems to be quite obvious that the Customs authorities are fully aware of what actually happened, may we suggest that the United States Customs write Bunge Corp. a letter stating that upon investigation they found that through an error of the elevator 5,000 bushels of bonded grain was loaded out in Bunge Corp. cargo and even though Bunge's were not aware of it, it actually took place and therefore 5,000 bushels of bonded grain was shipped against our own Customs entry, and therefore, in order to assist the Customs, Bunge Corp. should be asked in that letter to file an amended declaration and pay the refund of subsidy on that part of the grain which was not entitled to subsidy. Once we have such a letter from the Customs, of course, it should be made clear that we were not at fault at any time, and after we receive payment from the third party involved for the amount assessed, we shall be most glad to authorize you to file an amended declaration on our behalf. Until we are in possession of the above-mentioned letter in which the Customs clearly express that we were not at fault, we cannot authorize you to file an amended return as it might throw a bad light upon ourselves, which we must of course avoid and in all circumstances. Yours very truly, BUNGE CORP., Senator THYE. What is the date of that letter, Mr. Bachmann? Mr. BACHMANN. September 11, 1951. Mr. MOSKOVITZ. Will you read the reply of the Stone Forwarding Co., Houston, Tex., to the Bunge Corp., 42 Broadway, New York, N. Y., for the attention of Mr. Robert F. Straub: Re steamship Poly Trader, our reference 51-1175. GENTLEMEN Will you read that, please? Mr. BACHMANN. Yes. [Reading:] We refer to your letter of September 11 with reference to the filing of corrected export declarations in connection with wheat on board the above vessel. A copy of this letter was delivered by us to the collector of customs here with request that he furnish a letter as required by you. Up to this time, we have no reply from the collector and in discussing the matter with him on several occasions he advised that your letter was sent to the collector of customs at Galveston for instructions. Up to the present writing the collector of Houston has had no reply from Galveston and will give no decision until such reply is received. He is requesting Galveston to acknowledge his letter and as soon as we hear from him we will advise you further. Yours very truly, It is signed by Herman F. Webber. It is written on the right upper corner, "passed copy out to Uhlmann, Fort Worth, 10-25-51 SK.” Mr. MOSKOVITZ. Have you seen where the Bunge Corp. bought the grain they put on the Poly Trader? Mr. BACHMANN. My recollection is that I went over all the working papers in connection with it at that time. Mr. MOSKOVITZ. Does that look familiar? [Handed a document.] Mr. BACHMANN. It does not register at the moment, but I wouldn't be a bit surprised if I had seen it before this. Mr. MOSKOVITZ. It provides for forty or sixty thousand according to this of hard winter wheat, f. o. b. steamer, Houston; is that correct? Mr. BACHMANN. If you are reading the document, I will take your word. Mr. MOSKOVITZ. That is what your recollection of what it shows; is it not? Mr. BACHMANN. Yes, sir. Mr. MOSKOVITZ. I would like to look at the copy of a wire dated January 19, 1951, and ask you if you have seen it before in the course of your investigation? Mr. BACHMANN. It does not register. I may have seen it. It does not register. I have seen so many and to pick out one document, unless it is a most significant one, it wouldn't register in my memory. Mr. MOSKOVITZ. I am quite in sympathy with you, having to testify from memory, but you do you question that Uhlmann sold 1,242,000 bushels of wheat against those contracts within what I told you? Mr. BACHMANN. No. Mr. MOSKOVITZ. F. o. b. steamer? Mr. BACHMANN. I don't question it. Mr. MOSKOVITZ. That is the amount that was actually loaded? Senator THYE. Let's have the contents of this telegram so that we may know what is in the telegram and the record may contain the information. Hand it over to Mr. Bachmann. Mr. BACHMANN. I think your eyes are better than mine. Senator THYE. Let's have it. Mr. MOSKOVITZ. Via Uhlmann's private wire, addressed and written by J. A. Benjamin, to McNamara, Milne, and Patrick: Tell Bunge Fort Worth completed loading January 18 at Houston, steamship Poly Trader, 142,000 bushels of wheat against contracts 6904, 6938, total amount $372,035. Fort Worth mailing invoices with details. Have also loaded against contract 6906 for same steamer 35,851 bushels of milo, total inventory $52,801.74. When invoices received kindly transfer money to Chicago for our account to the Continental Illinois Bank, covering both wheat and milo. Milo is corn? Mr. BACHMANN. Milo is a small seed corn that is similar to grain. Senator THYE. It is grown in the Southwest. Mr. MOSKOVITZ. I should not have asked these questions. The Senator knows these terms better than I do. Senator THYE. Let's proceed. Mr. MOSKOVITZ. The total was shipped f. o. b. Uhlmann-f. o. b. steamer by Uhlmann and it was only some months after the vessel departed that Stone Forwarding Co. told us that somebody had broken a bond and seal and put it in the place of the wheat that Bunge was buying. Mr. BACHMANN. That is not my recollection. Mr. BACHMANN. I don't recall that the bond was broken. At that time they had already been blending and mixing Canadian grain into export vessels and the way I remember it was that you had broken the bond. I don't recall in any of our investigations that term exactly, or the significance of that term within the picture. I don't recall it that way. Mr. MOSKOVITZ. Isn't that what Stone Forwarding Co. was writing, and is it this wheat, the Customs elevators were aware of it, but at the time did not question it? Mr. BUCHMANN. That is right. Mr. MOSKOVITZ. So this wheat, when it was loaded was in bond? Mr. BACHMANN. Yes, in the elevator, in bond in elevators under the United States Customs, sealed, and in order for someone to get into it, the bond had to be broken? Mr. BACHMANN. But the customs agent, as I recall it, was there. You mean break physically? Mr. MOSKOVITZ. Yes. Mr. BACHMANN. Yes. Mr. MOSKOVITZ. And in order to get wheat out of bond and make a custom entry for consumption? Mr. BACHMANN. Not if it is going into export. That wheat was not taken out of bond at that time. It was subsequently that the Transit Grain Co. took approximately, as I recall, a little less than half after it was out of bond and they were blending it into shipments that were going out as export from bond. Mr. MOSKOVITZ. Was that done by Bunge Corp's. instructions? Mr. BACHMANN. No. Mr. MOSKOVITZ. Did the investigation disclose that? Mr. BACHMANN. No. Mr. MOSKOVITZ. Did they know the Transit Grain Co. wheat was being mixed into the wheat? Mr. BACHMANN. Not that I know of. Senator THYE. In order that the record be perfectly clear, in the event this grain in bond was going out for export purposes, going to a foreign country, then it would not have to be reported or any duty paid on it if it was just simply elevated from the elevator into the ship? Mr. BACHMANN. That is my understanding. Senator THYE. The question is: Where was the ship going and to whom was the cargo going? Mr. BACHMANN. And it was the International Wheat Agreement. Senator THYE. And it was IWA, and that is the question. Mr. BACHMANN. That is right. Mr. GUINANE. Are you finished? Mr. MOSKOVITZ. I have a few more questions. You mentioned earlier, Mr. Bachmann that you had 16 concerns that you were looking into of which these 16 bought wheat either from Kellogg or Bunge Corp.? Mr. BACHMANN. I look at three of them. I look on this thing as a practical individual, without the fine legal description between the organizations. Mr. MOSKOVITZ. Your job is to develop the facts and you let the lawyers and Senators interpret them. Mr. BACHMANN. That is right. Mr. MOSKOVITZ. For the sake of clarity, these 16 concerns bought wheat from the Bunge Corp.? Mr. BACHMANN. Of the concerns, all of those, of the 20, 16 approximately got all or part of their wheat from Bunge Corp. I say approximately for a very good reason. For instance, one of the firms, Red Wing Milling Co., and there are other firms who bought wheat from Bunge, processed it, sold it but claimed no subsidy, but to whom they sold it claimed subsidy. Senator THYE. Have you information as to whom they sold it? Mr. BACHMANN. Oh, yes, we have traced it all the way. Senator THYE. Can you give for the record, to whom they sold it, the Red Wing Milling Co., for instance? Mr. BACHMANN. The three firms to whom Red Wing Milling Co. sold wheat on which subsidy was claimed and who processed this wheat on which subsidy was claimed Senator THYE. It was processed by the Red Wing Milling Co. and sold to whom? Have you the name of the company they sold to? Mr. BACHMANN. I have the names here. Rozell Export Co., New York. Another one, as I recall, was Sinason-Teicher. Senator THYE. And this company claimed subsidies on the same flour that went into foreign trade? Mr. BACHMANN. That is right. Senator THYE. Under the International Wheat Agreement? Mr. BACHMANN. Yes; that is right. I have a third. Senator THYE. I had agreed with the reporter to adjourn for a 5-minute recess. We will take a 5-minute recess and at a quarter to 4 we will resume. (Thereupon, a 5-minute recess was taken.) Senator THYE. If the committee will come to order, please, we will proceed. You may continue your answer. Mr. BACHMANN. Pillsbury Flour Mills is the third company. Senator THYE. You may proceed. You were asking him what companies. I see no reason to drag the names of all these companies, to which you say Bunge Corp. of Kellogg Milling Co. or Hallet & Carey sold Canadian wheat. Mr. MOSKOVITZ. Do you know whether they bought wheat from others beside these three companies? Mr. BACHMANN. I know they did. Mr. MOSKOVITZ. How about some of the others? Mr. BACHMANN. I don't know if Red Wing got any Canadian wheat from anybody else. Pillsbury may have, I believe. Mr. MOSKOVITZ. How about the others? How about the 16 others? Mr. BACHMANN. Some of them imported some of the wheat on their own. I don't recall any other company except the SinasonTeicher, that got theirs from more than one company. Mr. MOSKOVITZ. But some of the others went directly to Canada to get it? Mr. BACHMANN. Some of the others went directly to Canada to get this wheat. Mr. MOSKOVITZ. There were a few companies that did that? There were not very many that got their wheat out of Canada? Mr. BACHMAN. I don't believe so. Mr. MOSKOVITZ. Now, you mentioned the Flour Mills of America, some million-some-odd bushels of wheat of which about one-fourth was let out by the Bunge Corp.? |