The Manning times. [volume] (Manning, Clarendon County, S.C.) 1884-current, 1918-06-19
ARMY OFFICER ARRESTED
ON CRAFT CHARGE BY
GOVERNMENT MEN
Government Pursuit of Contr act
PrOfitecrs Continues
GREGORY REPORTS ON RAII>
Lieut.. Jas. &. StaIey, Reserve Officer,
Arrested; Other Arrests
May Follow
GREGORY REPORTS ON RAIL,

Washington. June 1S.--The trail Of
the government pursuit Of illegal
profiteerS on war contracts today led
to the arrest in New York Of Lieut..
James 6. Staly, a reserve army Of
Ger, on charge of accepting money
| from the Truefit Raincoat Company,
! @ New York, for a contrac: which he
| promised to secure.
The Arrest was made by Department
| of Justice agents who had followed
the officer during his inspection Of the
plant of the raincoat company, whose
! iproprietors acted in cooperation with
the government to detect the fraud.
The secret agent arrested him i'm
nediately after ne was said to have
received a sum of money from Joshua
Roscnthal and Louis Werner, proprie-
tors Of the plant. 1t was charged that
| he had told them that he would ex-
pect more money as soon as they got
the contracts which they sought for
$1,000 raincoats, costing nearly $780,
600
! This was the first arrest of an army
officer since the Department of Just
ice started it's investigation into the
| system by which contingent fee
agents have made N silions by obtain
/ ing contracts for manufacturers who
were charged commission. Other
arrests may follow soon.
Lieut.. Staley is about so wears old
He entered training camp last SUM-
mer and was commissioned in August
Last December II he was appointed
an inspector in the quartermaster'
department. He has been stationed
! in New York most of the time since
After being arrested today Lieut..
Staley made a complete confession Of
his part in the transaction, Depart
ment Of Justice officials said, and
gave much valuable information which
may lead to the detection of other
eases Of fraud. He will be tried By a
courtmartial.
The shadow Of completely in the
extensive scheme by which cOmnlG~
sion agents made millions out Of gov
ernn1ent war orders by acting as mid
die men in obtaining contracts Tor
manufacturers, today extended TO
scores of business men and attorneys
in Washington, New York and Boston
and other cities, and even to few
secretaries of members of Congress-
These men, many Of whom were anna.
! tcurS in the game of soliciting war
contracts, promised to use their influ-
ence with government officials, army
Officers or members Of Congress 20
assure the awarding Of contracts TO
special concerns, and in turn were 10
receive compensation if the contracts
were landed.
A large proportion Of these cases
were not prompted by sinister motives
officials believe, and prosecutions VIII
not follow. Many others, however, az.
pear the result of carefully planrc,i
plots TO squeeze millions from crn.
tractors.
Officials intimatcd that other a..
r .Sts may be made soon in connection
with the charges on which four men
are now under indictment hcrc--con,
nlracv to violate federal laws forb,G-
Ding the subletting of contracts and
payment of contingent fees.
Agents of the Department Of Just
ice. Treasury and War and Navy De
partments were at work TODAY on new
phases OF the disclosures in Washirg-
ton and elsewhere, while corps Of
| investigators, digcstcd the evidence
contained in the documents.
Report to Cabinet
Attorney General Gregory took the
latest information on the raids to The
Cabinet meeting and Cabinet mem.
bcrs and heads of all executive depart
mcntS. making contracts received the
Attorney Generals recommendation,
approved by President Wilson. for IN.
sertng IN future contracts of a clause
binding the contractor not to pay con-
tmgent fees nor employ middle men
IN negotiating a war order.
Analyzing the reports on ycster.
days raids, provide q task which will
take more than week, particularlr
SIncc some OF the evidence was gath.
cred as far west as San Francisco.
NO names Of either manufacturing
concerns or suspected commission
agents were given ou,.
One OF the principal arrangements
af the inquiry now is directed to learn
ing whether an army or navy officer
was subject to sinister influence of the
agents.
Baruch TO Assist
Bernard Baruch, chairman Of the
war industries board, promised his CO.
operation today in fcrrctinG out any
uses OF fraud or improper conduct by
fny officers in his department having,
charge OF arranging contracts be.
tween the War and Navy Department
and producers.
All day today letters and kilograms
poured into the Department Of Justice
from manufacturers who had been So
licited by commission agents. Some
manufacturers gave valuable inform
alton.
These letters constituted only one Of
the elements leading officials to be-
lieve they have uncovered an even
more extensive system Of fraud and
impropriety connected with war or
'dcrs than they had imagined.