Mr. GUINANE. You did not sell any? Mr. BAILEY. I quoted prices and distributed samples. Mr. GUINANE. As a result of your efforts, did Bunge sell it? Mr. GUINANE. How much, about, was sold? Mr. BAILEY. All I know is that they sold a lot. Mr. GUINANE. Did you get a commission on sales? Mr. BAILEY. No, sir; just a salary. Mr. GUINANE. Because Gano Grain is owned by Bunge? Mr. BAILEY. Yes, sir. Mr. GUINANE. What were your instructions with reference to contacting elevators down here? Mr. BAILEY. Elevators in Texas or Fort Worth? Mr. GUINANE. In Texas, in Galveston. Mr. BAILEY. I have no operational phase with the elevators in Galveston or Houston. Mr. GUINANE. You have not contacted them at all? Mr. BAILEY. No, sir. Mr. GUINANE. I want to read an excerpt from a letter read_previously into the record, dated May 1, 1951, signed "Dick," from R. E. Bailey to W. G. Kellogg, Bunge Corp., Minneapolis. One paragraph. [Reading:] We had a nice convention in Dallas. It was my pleasure to entertain the CCC fellows and their wives at a dinner Saturday night, also the Galveston Wharves folks. This was a very worthwhile evening. What do you know about that? What do you mean by that? Mr. BAILEY. It was enjoyable to get to know those people. I was new in Texas. Mr. GUINANE. You did have contacts with them? Mr. BAILEY. I said I didn't have any operational contact. Mr. GUINANE. But did you pay them anything for handling the wheat for Bunge? Mr. BAILEY. No, sir. I make no disbursements for Gano or Bunge. Mr. GUINANE. Did you pay any money on behalf of Bunge or Gano Grain Corp. for mixing this unfit wheat? Mr. BAILEY. No, sir, I did not. Mr. GUINANE. How much did you spend on these entertainments for Commodity Credit Corporation people? Mr. BAILEY. There were a couple there, Mr. Earl Cox and his wife. Mr. GUINANE. Is he still employed by Commodity Credit Corporation? Mr. BAILEY. No, sir, he is not. Mr. GUINANE. Who is he now employed by? Mr. BAILEY. He is in Fort Worth, with the Bewley Mills. Mr. GUINANE. Does Bunge Corp. have any interest in that mill? Mr. BAILEY. No, sir. Mr. GUINANE. And who else was there? Mr. BAILEY. And Mr. Sweeney and his wife were there. Mr. GUINANE. Mr. Sweeney and his wife? Mr. BAILEY. Yes, sir. And there were two couples, I think were relatives of Mr. or Mrs. Sweeney. I had never met them before nor since. Mr. GUINANE. No conversation took place with reference to Canadian wheat? Mr. BAILEY. No, sir. Mr. GUINANE. Mr. Sweeney didn't say, "I am handling a lot of that Canadian wheat"? Mr. BAILEY. No, sir; he did not. Mr. GUINANE. In another letter, which Mr. Kellogg wrote to you he said: Glad that you had a nice meeting in Dallas entertaining the CCC fellows. Also the Galveston Wharves people. I believe that this kind of a thing is very good for us-certainly a good idea to be well built in with these fellows. Now, why did he think it was a good idea for you and Bunge to be built in with CCC people? What were you getting from them? Mr. BAILEY. I entertained those people only in San Antonio. That is a typographical error, in Dallas. Mr. GUINANE. You did not entertain them Mr. BAILEY. That is a typographical error and was an oversight at the time. Mr. GUINANE. Wherever it was, what benefit did you expect from Commodity Credit? Mr. BAILEY. We stored grain for CCC, Uhlmann Elevators do, the Government grain, under the loan program. And there are times in the course of the year when the Government will sell grain, and it's nice to know those folks so they will offer you the grain and corn. It's just a customer relationship. Mr. GUINANE. It is a pretty good proposition for elevators to have CCC wheat in the elevators, isn't it? Mr. BAILEY. That is practically all our storage these days; yes, sir. Mr. GUINANE. And quite a few of them would go out of business if it were not for that? Mr. BAILEY. If it weren't for the storage program; yes, sir. Mr. GUINANE. Do you exercise considerable care you do not take advantage of overages? Did you hear Mr. Thornton testify, yesterday, on overages? Mr. BAILEY. Yes, sir; I hear of them. Mr. GUINANE. Is your elevator the beneficiary of considerable overages on Commodity Credit wheat? Mr. BAILEY. No, sir. Mr. GUINANE. You don't take the overages? Mr. BAILEY. Well, sir, as far as overages, I know of none in our elevator. Mr. GUINANE. Is that a peculiar situation of the Galveston Wharves only? Mr. BAILEY. I am not familiar with how they do their business. The CHAIRMAN. Do you ever have any fog in the vicinity of your elevators? Mr. BAILEY. In Fort Worth? The CHAIRMAN. Do you have any fog there? Mr. BAILEY. I imagine we have normal weather conditions. The CHAIRMAN. Do you open windows when you have a foggy day? We had testimony here it was highly profitable to open windows on a foggy day. Mr. BAILEY. I will have to check with my superintendent when I get back. The CHAIRMAN. Proceed. Mr. GUINANE. I want to read another letter from Mr. Kellogg to Mr. R. E. Bailey, dated May 3, 1951. [Reading:] I have your letter of the first and note that you are still working on some of our Canadian wheat. I am very sorry that there is none of this wheat available now and so forth.· I sold some more of this wheat to Julian Scott today. We have sold him a good lot of Canadian wheat and we have done fairly well on it, and I believe that he has made a lot of money. *** He does not want too many people to know of the wheat which he has bought from us. Mr. GUINANE. Did you know in Houston he was mixing that wheat with Commodity Credit wheat? Mr. BAILEY. Sir, I don't know what he did with the wheat. He called me one time from Kansas City and said he wanted to buy that wheat, and I referred him to Minneapolis because I was not familiar with the terms. All I had was the price; and he had a sample of the grain. Mr. GUINANE. Scott didn't tell you the easy way he had found of making money? Mr. BAILEY. No, sir. Mr. GUINANE. This is about all I have of Mr. Bailey. The CHAIRMAN, Who is your next witness. Mr. GUINANE. Mr. Winters. The CHAIRMAN. Will Mr. Winters come forward, please? TESTIMONY OF C. J. WINTERS, NEW ORLEANS, LA. (The witness was sworn by the chairman.) Mr. GUINANE. Mr. Winters, you were formerly superintendent of the New Orleans Public Elevator, were you? Mr. WINTERS. Yes, sir. Mr. GUINANE. And during that time, did you handle some Canadian frost-damaged wheat for the Bunge Corp.? Mr. WINTERS. No, sir. Mr. GUINANE. Did you handle any wheat for Bunge Corp.? I Mr. GUINANE. How much would you say you handled during 1950? Mr. WINTERS. That would be very difficult to say, offhand. couldn't even guess at it. Mr. GUINANE. Or in 1951? Mr. WINTERS. The answer would be the same. the records. I'd have to get Mr. GUINANE. You handled a considerable amount of wheat labeled Spring wheat or Sample grade Dark Northern Spring wheat? Mr. WINTERS. No, sir. Mr. GUINANE. Do you recall handling 84117-53-pt. 2-28 Mr. WINTERS. No, sir; not a bushel of it. Mr. GUINANE. Did you handle any for Fox? Mr. WINTERS. No, sir. Mr. GUINANE. Did you handle any for Kellogg Milling Co.? Mr. GUINANE. I want to read a letter, Mr. Winters, dated May 22, 1952, copy of a letter rather, addressed to Búnge Corp., 42 Broadway, New York, signed "C. J. Winters, superintendent," with a copy to Mr. James Ringwold, Minneapolis, Minn., and a copy to W. L. Richeson & Sons, Inc. [Reading:] Your stock of wheat as reflected on our books as of midnight May 21, 1952, reads as follows: S. N. Spring wheat Now, what does that mean? Mr. WINTERS. Sample grade Dark Northern wheat. Mr. GUINANE. Did you handle any of that in your elevator for Bunge? Mr. WINTERS. I don't think so. Mr. GUINANE (reading): 40,000 bushels; Hard wheat, 4,000 bushels; 2 mix wheat, 5,000 bushels; 2 Hard wheat advanced by P. G. E., 79,503 bushels. We are making the following adjustments as of that date. S. N. Spring That means Sample grade? Mr. WINTERS. Sample Northern. Mr. GUINANE (reading): 1 Hard and 2 mix stock, 50,987/19 bushels; S. N. Spring 1 Hard and 2 mixed to 2 Hard wheat, 50,987/19; balance S. N. Spring 1 Hard and 2 mix, none; 2 Hard wheat owed to P. G. E., 79,503/30 bushels; S. N. Spring Hard and 2 mix to 2 Hard wheat, 50,987/19 bushels. Balance 2 Hard wheat owed to P. G. E. 28,516/11. As a result of the above adjustment your wheat sock will now read: 2 Hard wheat owed to P. G. E. 28,516/11 bushels. It's signed "C. J. Winters." Do you have any recollection of writing that letter? Mr. WINTERS. Oh, yes, that is definitely written by me, yes. remember writing the letter. Mr. GUINANE. What does this letter purport to show? I do Mr. GUINANE. It means Bunge shipped in 40,000 bushels of Sample grade Dark Northern Spring wheat? Mr. WINTERS. That's right. Mr. GUINANE. And you mixed it in the elevator and credited Bunge with the equivalent of 40,000 or 50,000 bushels of No. 2 Hard wheat? Mr. WINTERS. Definitely, yes. Mr. GUINANE. Could you give me any idea of the price of sample grade wheat when it arrived at your elevator? Mr. WINTERS. No, sir. Mr. GUINANE. The difference at that time between Sample grade wheat and No. 2 hard wheat would be about how much? Mr. WINTERS. I haven't the slightest idea. I know nothing about the price of wheat. Mr. GUINANE. It would be 8 or 9 cents a bushel, would it? Mr. WINTERS. I haven't the slightest idea. I couldn't tell you. Mr. GUINANE. Did you receive any money from the Bunge Corp. or from Stone Forwarding Co. or from Richeson Forwarding Co. or from any representative of the Bunge Corp. for mixing this wheat in this manner? Mr. WINTERS. No, sir. Mr. GUINANE. Was this the same manner in which you mixed wheat for Transit Grain Corp.? Mr. WINTERS. No, sir. That was something different entirely, a different proposition. The difference was the wheat that was Transit Grain's was Canadian wheat that moved down here in bond. Mr. GUINANE. And this wheat was not Canadian wheat? Mr. WINTERS. I presume it was not, because we handled no Canadian wheat for Bunge at all.. Mr. GUINANE. You say you did not know this was Canadian wheat? Mr. WINTERS. No, sir; I didn't have any idea it was; and I doubt that it was. Mr. GUINANE. You doubt it was? Mr. WINTERS. I do. Sample grade Northern Spring wheat doesn't necessarily have to be Canadian bonded wheat. We have handled millions of bushels of Northern Spring wheat that wasn't Canadian wheat. The CHAIRMAN. How did you know that, if, in the event you didn't know this was? Mr. WINTERS. I say I don't know. The CHAIRMAN. But how are you so positive, you handled millions of bushels that were not imported grain, how can you be positive about that? Mr. WINTERS. This Transit grain, that moved to us under United States Customs bond. I said it came that way because it was Canadian wheat. The CHAIRMAN. Proceed. Mr. GUINANE. But all the wheat didn't remain in bond in Transit Grain, did it? Mr. WINTERS. You mean when it was received by us? Mr. GUINANE. It was received by you in bond; but was it exported in bond? L Cod Mr. WINTERS. No, sir; only a quantity. The rest of it was taken out of bond by Transit Grain Co. and made free wheat. Mr. GUINANE. And duty paid? Mr. WINTERS. I presume so. Mr. GUINANE. And didn't they pay a lower duty at 5 percent ad valorem as wheat unfit for human consumption? Mr. WINTERS. I did not know about that. Mr. GUINANE. This wheat was designated Sample grade Dark Northern Spring? Mr. WINTERS. Which wheat? Mr. GUINANE. This 40,000 bushels you mixed for Bunge. Mr. WINTERS. I don't know that. I say I don't have any recollection of mixing that. Mr. GUINANE. You do not? Mr. WINTERS. No, sir. |