1. Note from Homer Stanhope to John E. Toole, June 24, 1949- 2. Memorandum from Oliver R. Kraft, St. Louis to C. G. Alexan- 4. Report of G. W. Brodie, examiner, February 28, 1949- 5. Report of William J. Rochelle, examiner, January 13, 1949. 6. Report of H. J. Herrmann, examiner, January 13, 1949. 7. Report of R. M. Anderson, examiner, January 18, 1949. 9. Report of J. Frank Williams, examiner, September 22, 1949- 10. Second loan application of American Lithofold Corp., July 6, 12. Report of C. B. Turner, examiner, January 25, 1949 13. Report of telephone conversation between Mr. Everett and 18. Photostatic copy of commission ledger, William M. Boyle, Jr., 19. Memorandum from Homer Stanhope to R. J. Blauner relating 21. Expense account of R. J. Blauner, October 1950- 27. Article from St. Louis Post-Dispatch by Theodore Link, July 28. Editorial, St. Louis Post-Dispatch, July 28, 1951. 29. Memorandum from A. K. Brehm, treasurer, Carthage Hydro- 31. Letter from David J. Cartenuto, counsel, RFC in New York, to Guy George Gabrielson, October 12, 1950. 33. Second loan application, Carthage Hydrocol, February 25, 34. Third loan application, Carthage Hydrocol, March 17, 1949. 37-B. Letter from F. M. Dawson, vice president, Carthage Hydro- col, to W. C. Schroeder, February 2, 1950. . 37-C. Letter from W. C. Schroeder, Bureau of Mines, to F. M. 37-D. Letter from F. M. Dawson, vice president, Carthage Hydrocol, to W. C. Schroeder, February 28, 1950 38. Report of long-distance call between Mr. Hughes, RFC, in 1950. 39. Excerpts from diary of Harvey J. Gunderson, January 1, 1948, 40-A. Letter from Oscar L. Chapman, Secretary of Interior, to Francis D. Flanagan, October 2, 1951.. 40-B. Letter from Guy George Gabrielson to Oscar L. Chapman, 41. Letter from Guy George Gabrielson to W. Stuart Symington, (*) 43. John Wood Co., prime contract awards, October 1, 1951- 44. Excerpt from minutes of a meeting of the Board of Directors, 1. Itemized statement submitted by Charles B. Molling re trans- actions with American Lithofold Corp 2. Tabulation of sales made by James B. E. Olson and Joseph D. 7. Copies of the correspondence between Francis D. Flanagan, counsel, Senate Investigations Subcommittee, and W. Stuart INFLUENCE IN GOVERNMENT PROCUREMENT THURSDAY, SEPTEMBER 13, 1951 UNITED STATES SENATE, INVESTIGATIONS SUBCOMMITTEE, COMMITTEE ON EXPENDITURES IN THE EXECUTIVE DEPARTMENTS, Washington, D. C. Met at 10:10 a. m., pursuant to Senate Resolution 156, agreed to June 14, 1951, first session, Eighty-second Congress, in room 357, Senate Office Building, Senator Clyde R. Hoey (chairman) presiding. Present: Senator Clyde R. Hoey, of North Carolina; Senator John L. McClellan, of Arkansas; Senator Thomas R. Underwood, of Kentucky; Senator Joseph R. McCarthy, of Wisconsin; Senator Karl E. Mundt, of South Dakota; Senator Richard M. Nixon, of California. Also present: Francis D. Flanagan, chief counsel; Howell J. Hatcher, chief assistant counsel; Carmine S. Bellino, accounting consultant; Jerome S. Adlerman, assistant counsel; William Leece, assistant counsel, Ruth Young, clerk. Senator HOEY. The committee will come to order. I wish to make a very brief opening statement. In the recent past, the St. Louis Post-Dispatch has published news stories concerning RFC loans made to the American Lithofold Corp. of St. Louis, Mo., and the connection of William H. Boyle, Jr., and others with these loans. As the results of the information published in these news dispatches this subcommittee ordered the staff to undertake a preliminary investigation. On August 25, 1951, after completion of that preliminary inquiry, the subcommittee decided to make a full investigation of the loans made by the RFC to American Lithofold Corp., together with the dealings of this corporation and its representatives with officials and agencies of the Government, including the employment of Mr. Boyle as its attorney or representative. It is the purpose of these public hearings to explore fully all of the pertinent facts in this case. The subcommittee has not sought to prejudge this case, nor will it render any final judgment until the completion of this inquiry. In view of the fact that a large part of this investigation involves the RFC loans which were made to the American Lithofold Corp. in 949, the first witness who will appear here today is J. Frank Williams, an RFC examiner who has handled and processed the American Lithofold loans over a long period of time. It is believed that Mr. Williams' testimony will outline the basic facts and information concerning the handling of this loan and will make it possible for the subcommittee to get a clearer understanding of the various ramifications of the loan. Other witnesses whose testimony might be nec 199 essary to ascertain or amplify the facts in this case will also be called upon to testify as the inquiry progresses. We will follow in this hearing the same policy we adopted heretofore, and that is that the photographers can make pictures of the witnesses when they come to the stand and are sworn, but no pictures are to be made during the progress of the hearing. Mr. J. Frank Williams, will you stand up. Hold up your right hand, Mr. Williams. Do you solemnly swear that the testimony which you give in this case will be the truth, the whole truth, and nothing but the truth, so help you God? Mr. WILLIAMS. I do. TESTIMONY OF J. FRANK WILLIAMS, WASHINGTON EXAMINER, OFFICE OF LOANS, RECONSTRUCTION FINANCE CORPORATION Mr. WILLIAMS. I would like to say at the outset Senator HOEY. Wait just a minute. minute. Are the photographers through now? Mr. Williams, you give your name, position, and duties to the reporter. Mr. WILLIAMS. J. Frank Williams, Washington examiner, Office of Loans, Reconstruction Finance Corporation. Senator HOEY. How long have you been with the Reconstruction Finance Corporation? Mr. WILLIAMS. Approximately 18 years. Senator HOEY. How long have you been in your present capacity as examiner? Mr. WILLIAMS. Oh, approximately the whole period. Senator HOEY. The whole period of time. Mr. Williams, did you handle this loan of the American Lithofold Corp.? Mr. WILLIAMS. I only had anything to do with the administration handling and servicing of the loan approximately 5 years after their first borrowings from the Government—that is, on or about August 17, 1949. Senator HOEY. All right. I wish you would give to the committee the chronology of this company, what sort of company it is, where it is located, and then of the loans which preceded these, as shown from the records. Mr. WILLIAMS. The American Lithofold Corp. is located in St. Louis, Mo. It had New York offices when they began their original borrowings from the Smaller War Plants Corporation. It was established June 15, 1936. It is a printing firm, and prints and sells Senator HOEY. Established what year, did you say? Mr. WILLIAMS. 1936. Senator HOEY. 1936; all right. Mr. WILLIAMS. It prints and sells continuous business, fanfold, and snap-out forms. It had about 2,000 customers, including the Federal Government. Senator HOEY. All right. Now, what loans did it have prior to the time that you began handling it, and how did they originate? |