The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1918-02-20
HOG ISLAND SCANDAL.
INVESTIGATION ORDERED BY
PRESIDENT WILL FLUSH BIG
GAME.
High Finance and Reckless Waste OF
Government Money Chargeti--Crin,-
inal Prosecutions May Follow
Several dollar Year Men" InvOlv.
cd

American International Corporations
construction of the governments big
fabricating steel shipyard at Hog Is
land, Pa, was ordered today by Pres
ident Wilson with a view to criminal
prosecution IL the facts develop more
than reckless expenditure of govern
ment money.
| At the same time Chairman Hurley
of the shipping board. who had re-
quested the move, indicated that the
corporations contracts for building
the yards and ships involving many
millions of dollars, might be cancell-
ed. which was taken to mean that
the government might take over the
yard. complete its construction and
build the ships itself. This step has
been urged by members of the SEN
ate committee investigating ship build
ing.
The president asked for the inves-
tigation in the following letter to At
torney General Gregory:
"Mr. Hurley. of the shipping board,
has called my attention to some very
serious facts which have recently
been developed with regard to con-
tracts made in connection with the
bodybuilding program with the conf
pany operating at Hog Island. They
Il n nj
think that we can let them be taken
care of merely by public disclosure
and discussion. would be very much
obliged IL you would have some trust
worthy person in your department get
into conference with Mr.. Hurley
about the whole matter with a view
to instituting criminal process in case
the facts justify it,"
Charges of mismanagement and u
reckless spending OF government
funds at Hog Island have been made
freely before the senate committee.
| Witnesses have testified that the
yard. for which the shipping board
is putting up all the money. may cost
twice the sum of $21,0O0,O0O carried
in original estimates. The slow pro-
sress made In construction Of the
yard and reports OF loose manage
ment prompted chairman Hurley
three weeks ago to put i'm full charge
OF the work Former Rear Admiral f.
A. Bowles. assistant general manager
OF the Emergency Fleet Corporation
who is now on the ground.
Mr.. Hurley's threat to cancel the
contracts was contained in a letter to
Admiral Bowles directing him to un-
cover any Irregularities and notifying
him that the attorney general had
been requested to designate n special
assistant to aid him. Admiral Bowies
was directed to effect more economi-
cal management.
The Hog Island contract was the
largest of three fabricating steel ship
contracts let by the Emergency Fleet
Corporation for which the government
was to furnish all the money. The
corporation is acting in effect as an
agent Of the government and in the
words OF Admiral Bowles before the
| senate committee is furnishing the
know how" 1t stands to make Il
profit of sG.000,00O on the yard and
| on the ship it is to build The Amer
lean International Corporation is COM
posed OF some OF the country's most
powerful flnanciers. including Frank
A. Vanderlip. Percy A. Rockefeller, j..
| Ogden Armour. Robert Dollar, and
Robert s. Lovett.
The American International Ship
building Corporation subsidiary of
the American International Corpora
tino. is actually building the yard and
will build the ships although the gov
ernments contracts were made with
the American international Corpora
ton. The senate committees inquiry
developed that some work has been
sublet to outside contractors.
George j. Baldwin. chairman OF the
American International Corporation,
denied before the committee this week
that expenditures had been excessive
Ina view OF the governments demand
for speed.
The senate committee has gone
deeply into the Hog Island project.
Testimony has disclosed that con-
S'ruction is four months behind.