The Watertown news. [volume] (Watertown, Wis.) 1917-1919, 1918-02-15
VANDERBILT DEAL
GOES UNDER QUIZ
President Directs Attorney Gen.
eral to Look Into the $42,-
100000 Contracts.
PLANNED BIGGEST SHIPYARD
United States Government to Deter
mine If There Has Been Any Mis-
use of Government Funds-Sen.
ate Charges to Be Aired.

Washington. Feb. 15.-President VIII
son directed Attorney General Gregory
to investigate the much-discusSed Hog
Island shipyard contracts, which have
been adversely criticized before the
senate commerce committee, and de-
termine if there has been any criminal
misuse of government funds.
The president also directed the at
tOrney general to work in conjunction
with Chairman Hurley of the shipping
board in his investigation. About
$42,OOO,OOO of government money has
been involved in the Hog Island pro-
ject, in which the American Interna-
tional corporation, headed by Frank A.
Vanderlip. president of the National
City bank, has figured.
Presidents Letter to Gregory.
Here is the letter President Wilson
wrote to Attorney General Gregory,
after Chairman Hurley explained the
shipping situation:
Mr.. Hurley of the shipping board
has called my attention to some very
serious facts which have recently been
developed with regard to contracts
made in connection with the shipbuild-
ing program with the company operat-
ing at Hog island.
"They are so serious, indeed, that |
do not think that we can let them be
taken care of merely by public dis
closure and discussion. | would be
very much obliged if you would have
some trustworthy person in your de-
partment get into consultation with
Mr.. Hurley about the whole matter,
with d view to instituting criminal pro-
cess in case the facts justify it,
May Cancel Contract.
Chairman Hurley of the shipping
Manager Bowles of the Emergency
Fleet corporation that it may be neces-
sary TO cancel the American Interna-
tional corporations contract for build
ing the government shipyard under
construction at Hog Island, Pa.
Investigation by the department of
commerce was recommended by Chair
man Hurley of the shipping board, who
asked that an assistant to the attorney
general be sent to Hog island to work
with Assistant General Manager
Bowles of the Emergency Fleet corpo-
ration. Mr.. Bowles was put in active
charge OF the yard recently.
Mr.. Bowles has been directed by
Chairman Hurley to put the Hog
Island yard on an economic basis.
Shipping board officials are of the
rinfn fhaf hoS
worse at Hog island than inefficient
management and a reckless spending
of funds, but they want to know all
the facts.
The Hog Island shipyard on the Del
aware river, near Philadelphia, is
planned to be the greatest in the
country, with more than fifty ways On
which to lay down ships. The Ameri-
can International corporation, through
its subsidiary corporation, the Ameri-
can international Shipbuilding COM
pany, has contracts for its construc-
ton and for shipbuilding there from
the Emergency Fleet corporation, act
ing for the United States shipping
board
Testimony before the senate COM
merce committee, investigating the
whole subject of shipping contracts,
has developed statements that the gov
ernment will be obliged to spend be-
tween $40,O0O,0OO and $5O,OOO,OOO,
where government and civilian experts
estimated S21 100000 would suffice.
This testimony developed charges by
Representative LenrOot (Rep) Wis
consin, on the floor of the house that
through laxness in the letting of con-
tracts the American International and
its subsidiary were placed in position
to loot the treasury of millions Of dol
lars.
It has developed among other things
at the senate committees hearing that
Colonel Black of Philadelphia, one of
the former owners of Hog island, got
$1,000 an acre for his property, where
as year ago he held an option on
Hog island at 81, 900 an acre.
One of the principal points of at
tack on the International Shipbuilding
corporation in the senate committees
investigation has been that by it's con-
tract with the Emergency Fleet cor
poration 1t would receive a fee of
$6,OOO,O0O for the "know how of build
ing the shipyard and getting out the
ships.