Evening star. [volume] (Washington, D.C.) 1854-1972, 1918-12-20
SAYS j. S. BANKERS
DISAPPOINTED HUNS.
Becker Tells Why Kuhn, Loeb
& Co. Failed to Finance
Propaganda Program.
PAUL M. WARBURG LAUDED

PAUL M. WARBURG LAUDED
When Alfred L. Becker. deputy state
attorney general of New York, re-
sumed his testimony today on German
propaganda before the Senate COM
mittee he discussed the financing of
the propaganda program.
He said the German government was
'gravely disappointed" in it's hopes Of
financing the scheme through Kuhn.
Loeb & Co. of New York. German
officials, he declared believed that the
standing of the firm Of NJ. M. War
would give them an influence with
Kuhn. Loeb & Co., through Otto H.
Kahn, one of its officers. but the bank
imposed such difficult conditions that
they had to go elsewhere for financial
arrangements.
Cites Minotto Affidavit.
In discussing the Kuhn, Loeb & Co.
incident Mr.. Becker gave the commit
tee an account of an affidavit made
by Count James Minotto, an italian
subject, a son-in-law of Louis Swift,
and whose internment was ordered by
President Wilson. In that affidavit
Count Minotto told of a conversation
he had with Mr.. Kahn after his return
from Europe in 1915 in which an in
veStment in the Anglo-French loan
by Kuhn, Loeb & Co. was discussed.
Mr.. Kahn was quoted as saying that
while his firm had not invested in the
loan, he and Mortimer Schiff did not
deny having personally invested in 1t.
Senator Wolcott of Delaware object
ed to this testimony on the ground of
irrelevance, and in the discssion by
the committee Mr.. Becker said the
purpose of reading the affidavit was
to show that in 1915, Kuhn, Loeb &
Co. were painfully neutral" Senator
Nelson asked if the M. M. Warburg
of Hamburg. was not a brother or re-
lated in some way to Paul NJ. War
burg, formerly governor of the Federal
Reserve Board. He replied that such
was the case.
Mr.. Becker said also that the pur-
pose was to show that while Mr.. Kuhn
was telling the French government
that they had subscribed to the Anglo
French loan they were also telling the
German government that they had not
subscribed.
Warburg's Loyalty Attested.
In this connection, Senator Reed of
Missouri asked whether the loyalty
of Paul NJ. Warburg was being ques-
toned. and Mr.. Becker said. very en-
photically, that there was no such
question involved.
There is not man who has been
more loyal to our country than Paul
NJ. Warburg, and I think that the
country will suffer materially by his
hn cd
Board" remarked Senator King of
Utah. -~-
Senator Nelson of Minnesota, also
remarked that he had met Mr.. Kahn
while the latter was in Minnesota,
and that he was satisfied that there
was no more loyal citizen than he.
A portion of an affidavit made a year
ago by a person whose name was not
disclosed and which was withheld
from the record yesterday until the
committee had stricken out irrelevant
portions of it was admitted to the
record today.
The affidavit deals with a CONVEX
sation between the unidentified person,
Count Won Bernstorff. former German
ambassador, and w. F. McCombs. the
former democratic national committee
chairman.
The conversation is alleged to have
taken place in camp in the Adiron-
dacks in the winter of 1914. and to
have dealt with the interests of Bern
storff's efforts to obtain a newspaper
to take Germany's side of the war. In
that conversation the unidentified per-
son was quoted as saying that the
New York Sun would not accept an
advertisement for the sale of securi-
ties unless it was shown positively
that the investment would be legit-
innate one.
Turning to German financial trans
actions in this country, Mr.. Becker
explained that the system of DIR. Helm
nerich F. Albert for maintaining Sc
crecy in checking out sums from his
various bank accounts ultimately
proved to be the means of disclosing
the entire operations. Instead of
drawing checks directly, he wrote to
banks in which he held accounts.
asking them to draw cashiers checks.
By this means the letters were kept
on file by the banks and eventually
turned over to Investigators.
Used Red Cross Funds.
Mr.. Becker explained that GeNnaan
Red Cross funds collected in this
country and turned over to Count Won
Bernstorf were temporarily used for
German war purposes, although
eventually the German Red Cross
got equivalent credit in Germany.
4HC iCldliollo pCl" cen TIC NudIdHly
Trust Company of New York and
Hugo Schmidt, German commercial
agent of the Deutsche Bank of Ber-
lin, were described by Mr.. Becker
The trust company. he said, OBJ
tained large quantities of London ex-
change in its own name and ostensibly
for neutral interests, although really
used by German government and COM
mercial interests in the United States
and South America John H. McClem-
ent and the Standard Mercantile
Agency. New York, were dummies
used in this process, Mr.. Becker de-
clared.
When Mr. Becker undertook to give
the committee some additional in
formation on the activities of William
Bayard Hale, whose employment by
the German government as a secret
agent was disclosed in testimony
some time ago. he referred to him as
having been the biographer Of Presi-
dent Wilson. To this Senator Reed
interposed an objection. saying that
it was preposterous to bring the
name of the President into the dis
Hale has been discredited, and to
bring him into the case now in con-
nection with President Wilson's name
would reflect upon the President, SEN
ator Reed said.
IT can assure the committee that
there is nothing in what I may have
to say that will. in any way reflect