The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1918-12-20
REPORT ON HOG
ISLAND YARDS
CHARGES GROSS
ExTRAVAGANCE
Condition Before February
Was Organized Riot" Says
Department Of Justice
Money Not Considered.
NO CRIMINAL CHARGE
(By Associated PressD

WASHINGTON. Dec. 20.--The lohs
awaited report Of the department OF
Justice on the governments great Hog
Island shipbuilding project made pub.
Y lie at the white house today on wire
less instructions from President Viii
son says, searching investigation has
disclosed no criminal liability, but
recommends that board of arbitra'
ton determines what part II any OF
the more than $60000,000 the plant
cost was in excess of reasonable neces-
sity and should be demanded of the
contractors by the government
In brief the investigators report:
That the facts do not justify Grim
inal process and that no fraud or Sc
cret profits has been established:
That the probable cost of the plant
will be about s61,000,000 dncluding
$6.O00,OO0 for additions by order Of the
emergency feet corporation), COM
pared an original estimate of 21.00O,-
600 and revised estimate OF
$27,000,0O0.
In State of Chaos.
That no clear explanation of this dis
crepancy has been forthcoming; that
prior to February l last condition
existed at Hog Island which super
ficially at least would impress anyone
las an organized riot, tangled mass or
state of chaos.
That the contractor or agent, the
American international corporation in
substance has taken the position that
since this was a war job cost was OF
minor importance; and
That the question of reasonableness
of the expenditures should be referred
TO board of arbitration provided for
in the contract, proceedings to be
closed If the board finds the expendi-
lures reasonably necessary, or other
wise payment OF the excess to be de.
manded by the government.
Is Behind Schedule.
The report which is dated Septem-
ber ~, 1873, also stated that the plant
would be completed in September;
that the contract substantially was be-
ig,g complied with and that the con-
troyersy hinged mot 80 much upon the
question OF accomplishment. but upon
means. methods and expenditures"
But attached is q letter from the in
vestigators. dated September 81, which
the encouragement transmitted to
the president, referring to press re-
ports that the program is falling be-
hind schedule and calling attention to
the fact that the report was based
upon conditions as they appeared early
IN July.
General Manager Piez, of the Emer-
gency Fleet Corporation, appearing
yesterday before the senate commerce
committee. testified that the Hog Is
land Yard would be completed in
about sixty days; that the cost would
be about s63,300,000. and that the
plant had delivered one ship and laid
fifty keels
The department of justice investiga-
tion was made by two assistants to the
attorney general-G Carroll Todd and
Mark misunderstanding last Febru
AIRY, when President Wilson asked the
attorney general to get into consulta-
tion with Chairman Hurley of the ship
ping board. "about the whole matter
with "A view to instituting criminal
process in case the facts justify it,"
Charges of graft and gross waste had
been made In an inquiry conducted by
the senate commerce committee and
Mr.. Hurley had written to the Presi-
dent and to Mr.. Gregory saving there
was serious disorganization and neg
ligence at Hog Island" and that he de-
sired the aid of the Attorney General
in investigating conditions.
Set Out Contract.
The two assistants with the aid of
two naval technical advisers, Civil
Continued on Page Fourteen)