New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-09-14
Paymaster General De-
nounces Gentry Who
Promise to "Use Pull'
Many Pose as Brokers
Manufacturers Pay Huge
Amounts for Influence;
Warning Issued
Special Correspondence

WASHINGTON. Sept. 13.-Rear Ad-
miral Samuel McGowan, Paymaster
General Of the Navy, has started n
campaign against an army of grafters
who arc established here for the pur-
pose of getting money from manufact-
urers who desire government contracts.
Working under the names Of lawyers,
brokers and agents. hundreds OF them
have made a living in Washington for
years by pretending that they were in
a position TO use influence of some un-
specified sort with government officials.
Colloqually, they are known as the
short selling brigade" because they
will offer secretly to deliver" most any
government official who handles gov
crnment contracts for a consideration.
Some of them have large law Offices
and impress the uninitiated manufact-
urer with their Importance. Since the
beginning Of the war their ranks have
been increased greatly.
Manufacturers Duped
Admiral McGowan's attention re-
Gently was called to the fact that sew
eral bona fde manufacturers, who were
in a position to deliver millions Of
dollars worth of desired products to
the department, had been led to employ
these agents upon the impression that
they were indispensable. Several days
ago the departments attention was
called to the fact that one manufsct-
urer had a contract aggregating S5,0OO,-
600, because the local agent added a
commission of more than $4,000 TO the
estimate.
Another case, involving the incorpo-
ration Of a company which was selling
stock upon the promise of being able to
expedite contracts, was brought to the
governments attention. Persons were
actually buying stock upon the assump-
ton that the promoters could "swing"
war contracts.
AS a result Of the tremendous growth
OF the system. Admiral MCGOWAN has
prepared a statement, which has been
sent to all manufacturers doing bust
ness with the Navy Department for the
purpose of warning them against the
Influential agents" II says:
ut has recently come to the atten-
tion of the navy that certain persons
representing themselves 10 be manu-
facturers' agents or brokers have been
writing TO manufacturers that they are
in a position to obtain contracts for
them, obtain more expeditions pay
ments, and even have the goods of par
ticular manufacturers accepted by the
government.
Without Foundation"
These statements have in some cases
had direct reference to purchases being
made by the navy under competitive
bidding and public competition, and are
therefore altogether without founda-
ton.
There has been no change previous
ly pursued by the navy Of purchasing
materials after public competition, ex-
cept in those few industries in which
the demand exceeds the production, and
for this or other similar reason the
navy allots Is requirements among the
trade subject to final governmental
price fixing.
"On account OF the volume of their
business here some concerns have ex-
perienced local factory representatives.
such men being of real service as they
are qualified TO act for the contractor.
A representative who does not know the
manufacturers products can be OF no
useful service.
at is desired that all firms regularly
manufacturing or marketing products
used by the navy bid direct, and not
through the medium of so-caled manu-
tacturers' agents or representatives.
Bidding through a third party in
evitably leads to misunderstanding and
difficulties which can be obviated by
direct bidding. Each bidder may feel
assured of receiving fair and equitable
treatment, and the purchasing officers
will look out for the interest Of absent
bidders in this respect far more thor
oughly than any manufacturers agent
or representative possibly could"