The Brattleboro daily reformer. (Brattleboro, Vt.) 1913-1955, 1918-06-22
Even Represented Compel
. ing Seekers Of Contracts,
Inquiry Shows
BROKERS' BIDS IN
THEIR OWN NAMES
Contracts Obtained by Violating Con-
fidence of Clients Then EARNED Out
on the Lowest Terms-other Tricks
Frequently Worked.

WARRINGTON, June 22.-Ingenious |
schemes resorted to by contingent warI
contract fee brokers to mulct contract |
ors are revealed by the information obs |
tanned by the department of justice in
its investigation of profteering, from
the correspondence and books of thou
sands of manufacturers in all parts of 1
the country. Assistant Attorney GEN
eral Huston Thompson, who is in charge
lof the prosecution of profteers told
brought ont.
AS 6 rule manufacturers thought they
were gaining an advantage over com
lpetitors by employing brokers, but now
discover that the money paid for such
services was. in the main, thrown away,
as they could have done quite as well
without the intermediary services. They
thought the fees they paid were EN-
ploved to get contracts and were led
t. oppose that there We're men that had
I. oJe 'tseen' that unseen wires had
| { De pulled. All this, they now find,
was Imagination, and in many eases the
| fee agents were detriment rather than
q help.
The idea that the contingent fee bro
ker pays someone in office to get con
tract is largely fallacious. There are
a few such cases, and in these there will
be prosecutions
| The evidence shows that some brokers
undertook to represent competing firms.
Mr.. Thompson cited the case of one
brokerage concern known to have rep
resented several competitive bidders at
the same time and in some instances to
have gained in this way practical con-
troll of the bidding. The manufacturers
did not know the agents were represent
ing their competitors, as well as them
selves, although the arrangement had
/ the same effect in, boosting prices that
a Conspiracy would have chad. Some let.
tiers to clients contained promises not to
put in bids for certain other concerns
represented by the agent, nor to put
them in touch with the business, if the
favored client desired to bid.
Another common scheme was to get
quotations or options from several man
| ufacturers, who were thus eliminated
from direct government bidding. TIL,
agent, with the advantage of this prize,
knowledge, would bid in his own name
and, if awarded the contract proceed t
fill it by exercising the option given b,
the manufacturer, who quoted the low
est price to him. The benefits of com
. petition were thus appropriated by TIL
agent, instead of resulting in low price
to the government.
Under another plan the agent pre-
cured bids addressed to the governmen
from several concerns. These price
were communicated to some favore
bidder. presumably the one who pal
the largest commission, so that he coul
revise his bid before it was submitte
to the government by the agent alon
with those of the competing clients. |
some instances the agents are said
have put in their own bids in compel
tion with their clients, thus making SUI
of either profit or commission.
iii Attempts by brokers to evade govern
ment regulations and defeat the purpos
of eliminating middlemen and profteel
are illustrated by numerous letters SCI
out by them to manufacturers. Thes
letters recite the government s desil
that all contracts be made direct wit
manufacturers and say officials s'al
frowning upon dealers, jobbers, an
middlemen and for this reason we al
gradually disseminating the practice {
bidding in our own name.
They suggest that the brokers' Off,
be made branch of the factory, hand
all business in the manufacturers nam
and on a commission basis, the busine
to be transacted on the manufacturer
stationery by the commission concer
and all mail for the manufacturer to
II addressed to him at the brokers' offie
They ask for supply of the manufa
turer s letterheads, and say that one
! the things they will do will be to q