The sun., 1918-07-25
SCANDAL WILLCOST
81 A YEAR men JOBS
Adequately Paid L. s. Heads
to Take Up Duties in Many
Departments.
Q. NJ. OFFICERS INVOLVED
Four Kenyon Employees Are
Arrested in Plot to FOist
Defective RaincOats.

Dollar year men whose incomes are
not so great as to free them from all
suspicion OF using their Government po-
sitions to further special interests will
be gradually eliminated, 1t was asserted
in despatch from Washington last
night. The housekeeping has been I'M
dertaken because OF the charges OF ia
voritism in the placing of army con-
tracts made In the raincoat scandal In
this city. Many men who in the first
days of the war offered their services
to I'LL up the STATS of emergency bu-
reaus at the capital will be replaced by
officials who will be given adequate SAL
aries.
Confessions are said to have been OBJ
tanned from men involved in the rain
coat charges as 10 the means by which
they were able to obtain contracts
though their bids were higher than those
OF other manufacturers. The disclos-
ures indicate that contracts have been
jobbed on a large scale in shoes, shirts.
leggns coats and other supplies for
soldiers and that this has been possible
because commission brokers have been
able to swing contracts to manufacture
ers with whom they had an understand
ing by pulling wires at Washington. As
part of the effort to stop this practice the
elimination of the dollar a year method
of payment is planned. though the step
may work injustice to many patriotic
men who have been working with the
utmost conscientiousness since the first
days Of the war.
Quartermaster Inquiry.
II has been discovered also that a
number of officers in the Quartermas-
ter's Department who have voice in
the placing OF contracts are illegally re-
the which
employed them In civil life. In this
connection II was pointed out that all
army officers receiving compensation
from private sources are not open to
suspicion particularly those who have
nothing to do with the purchase of sup
plies.
1t is asserted in addition that large
number of officers, particularly in the
Quartermaster's Department. obtained
their army commissions through the in
fiuence OF their former employers. 1t lie
charged that some of these officers have
used their influence to obtain army COM
missions for other men similarly sit
uated. and as a result certain groups OF
companies have been able to dictate
Specifications on contracts in their lines
that practically limited the bidding to
them.
In relation to specific charges Of fraud
II was said yesterday that the move
against raincoat manufacturers was only
a beginning. Action against manufac-
turers in other lines will be taken as
rapidly as the Department of Justice can
get its cases in shape. In some cases
the Government will rely on publicity
and will not undertake criminal prose-
cutions. These are cases where gross
profteering is evident but in which
charges OF fraud would be dfikult to
substantiate n court.
Huston Thompson, Assistant Attor-
ney-General in charge of the prosecu-
ton OF the raincoat manufacturers re-
turned to Washington yesterday. As
result of the publicity given TO the
investigation he directed here 1t was
said at the Office he has maintained
at the Hotel Seville last night that a
large amount Of information has been
given voluntarily by people with knowl-
edge OF frauds against the Government
Although raincoat war orders were the
primary subject of investigation here
much information was gathered that
will be OF value in the general inquiry
into war order contracts.
Government SwindIed.
Four employees of the c. Kenyon
Company. the largest ralncoat manufac-
turing concern in the country. were ar
rested yesterday charged with conspir-
ing to defraud the United States. The
men are alleged to have operated a
scheme by means Of which large guam
titles OF defective raincoats were slipped
into lots that had been approved by Gov
eminent inspectors.
The Kenyon Company. which en-
ploys between six and seven thousand
operatives, has Government contracts
for raincoats involving almost $1,000, 900
II has three plants In Brooklyn, one at
Atlantic and Carlton avenues another at
Pacific street and Fifth avenue and the
third in the Bush Terminal.
Although the arrests were the outcome
of an investigation of raincoat war or
ders being made by Huston Thompson,
Assistant United States Attorney
General, the Use is different from those
OF the seventeen manufacturers who
were arrested Monday. The accused men
are not charged with bribing or attempt
ing to bride Government inspectors to
pass rotten raincoats but with manipu-
iating lots TO accomplish the same end
Employees Arrested.
The men arrested yesterday were Ben
Wolf manager and general superintend-
ont Louis Friend, superintendent OF tho
Bush Terminal factory: Jacob Smolan-
ski. foreman and Henry Heda, shippins
clerk. They were arragned before
United States Commissioner Relfschnei-
der. Bail was fixed at $4,000 for Wolf
and at $4,000 for the others
No CHARGE were made against the
Kenyon Company as corporation or
against its directing officers After the
proceeding In court H. L. Kenyon. vice
president OF the company, had long
conference with Melville J. France
United States Attorney for the Eastern
district.
When hundreds OF thousands OF rain
coats in the Ouartermaster's depot were
inventoried after the beginning OF the
investigation large number OF coats
with uncemented seams and rotten cloth
were found.
The Kenyon Company is working on
three Government contracts for a total
OF 1,046,0OO coats. II has completed
other contracts for 100000 coats In
association with the Sigmund Eisner
Company of Red Bank. " J., with
which 1t had working arrangement
contracts for 100000 wool and cotton
brooches. 100000 wool and cotton coats
and hundreds OF thousands of overcoats
and underwear pieces have been award.
ed to the Kenyon Company during the
last ten years.
Coat shift Charged.
The complaint against the four en-
ployees was sworn to by Sidney r.
Pfeifer, an agent of the Department OF
IuStioa The cOmplaint cbarua. ,h., a..