New-York tribune., 1918-07-24
Defective Goods, Passed
by Inspectors, Are Or
dered Returned
Payment Refused
On All Contracts
Confessions, Made After
Arrests, Declared to In
volve Army Officers

Following the discovery of evidence
Of graft and bribery in connection with
the manufacture of soldiers rubber
coats it was intimated last night that
all Federal contracts for raincoats may
be cancelled and the government op-
Grafton of the plants recommended.
All deliveries we're held up yesterday
and payments ordered stopped until the
investigation now being made my Hus
ton Thompson, assistant to Attorney
General Gregory, is completed.
Agents of the Department. of Justice
Yesterday discovered that thousands of
rancoats at the quartermasters' depot
in this city, ready for shipment to
France were defective, and would be
useless if sent overseas. Captain +. c.
Weightman, in charge of the raincoat
inspection, Immediately notified large
number of concerns that the govern
ment would receive no more shipments
from them until further notice.
Payment Is Held Up
AT the same time Major Thomas Nc
Grath, having charge of the inspection
of all war materials in this district,
directed that payment be suspended
upon all pending bills of the seventeen
concerns involved in the conspiracy by
the Department of Justice. AS pay
ments are usually made from six to
ten days after inspection and delivery
OF goods the payments suspended in
clude thousands of dollars for coats al
ready N the hands of the government.
Many of the defective coats discov-
cred IN the Quartermaster's depot show
by their markings that they were re-
jected by the inspectors, and large
ton was altogether evaded by the
manufacturers delivering the garments
From Federal official it was learned
that the slipping through of rejected
and uninspected coats has increased
since the inspection was changed some
months ago from the quartermaster's
depot TO the factories.
This was done at the solicitation of
the manufacturers, whose claim was
that prompt performance of their con-
tracts required earlier payment than
could be had if the inspection was not
made until final delivery.
Trail eLads to Capital
Chief De Woody's me7 have dscov-
~-NN* q Wall ttldO lSdQS QiISCC 10 tnS
qLartermaster's department ir Wash
ington and important developments are
looked for. No definite information
as TO who IN the government service
had been cooperating with crooked
manufacturers would be given last
night.
Mr. Thompson, of the Department
OF Justice, said that Harry E. Lazarus,
Who was arrested yesterday, was not a
m npfl1 no nf ho
Defence, but was a member of COM
mlttee Of raincoat manufacturers which
frequently conferred with a sub-con1-
mlttee of the Council of National De-
fence regarding questions of manufact-
ure. The other members of this com
mittee were Lincoln Green and Clair
Kenyon.
Another Arrest Made
Charles W. Fuller, chief government
Inspector Of raincoats at the Bush
Stores in Brooklyn. was taken in Gus
tody yesterday, and it is said he made
complete confession of the inside
WORK 'ngs OF an extensive bribery sys-
lem. Fuller is quoted as saying that
he had received regular weekly allow
ances from several manufacturers.
Payments were made to subordinate
inspectors, at least one of whom re-
celved more than $500 in the last three
weeks
One inspector had "birthday" and
anniversary parties many times a
year as a means Of collecting gifts from
lhe contractors, who focked to his
fouse with their tribute. Some of the
presents were in the form of cash
Tells of Friendly Loans"
Ralph Rosenthal, one of the contract
o5s, @ VINO was arrested Monday night.
n IamItted u under examination by Chief
,o ne oody that payments described as
loaAs were made to government in
spsetor at his plant and that no re-
quest ever was made for repayment.
RosenthaI professed his inability to
explain why, after receiving "harsh and
sohtemptuous treatment" for long
,me , from army officers in charge of
etuhg contracts, he was suddenly per-
mitted free entry into their offices,
whIe others waited hours outside. This
change IN treatment came after he
started making "loans."
hosenthal was unable to explain why
ne small manufacturer, was given
oenlracts when certain other concerns
OF nigh standing were turned down. He
;n euIed that he was told by government
inspectors to use certain cement in
MAKING the coats. When asked whether
tinis brand OF cement was good or not,
nc salo; 1t was rotten"
), another disclosure of Rosenthal was
.ila' ne had been awarded a large con-
.ract TOR light and heavy raincoats at
ssol2'2 and s5.62Aa each, although a
lew days later the government had
iSed hSed a fiat maximum price of cents
io"er foH the same kind of coats. He
saia that several concerns had been
gwen contracts at this price. although
'helr bids had been lower.
me papers and files of the manufact-
ufesS show that wealthy young men
sought exemption from the draft by
Uptainlng menial jobs with manufact-
U'efs holding government contracts.
Fifteen Held Under Bonds
flftecn of the men arrested Monday
nnlght We're arraigned before United
SS'ates Commissioner Hitchcock in the
Ieoeral Building yesterday and held in