The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1918-06-18
Commissions Ranged From )
to 25 Per Cent.
Hundreds of Contractors Of
fees Raided Yesterday.
FEES RUN into MILLIONS
New Illegal Contracts Uncov-
cred by Raids.
Thousands of Letters and DOcu-
ments Seized.

washington, June 1s.-Se vera
thousand letters and documents con-
tanning proofs of an elaborate system
of obtaining government contracts on
the Illegal contingent fee basis, were
received today by the department OF
Justice from its agents who conducted
raids on hundreds of contractors pusl-
ness offices, late yesterday.
The commissions paid on these con-
tracts, 1t was disclosed, ranged from
( to 20 per cent and the aggregate
fees probably ran into millions OF DOL
lars. Evidence was discovered OF
HUNDREDS of contracts made unoer
these arrangements heretofore unsus
pected by the department OF justlce.
Manufacturers Threatened.
Manufacturers were threatened in
many cases with being deprived OF
contracts if they refused to negotiate
with these agents on commission
commentator plan. Some agents rep
resented that they had special infiu-
ence over members of congress.
In addition to those documents
other information came to the depart
ment from manufacturers VINO nao
been solicited by contract commission
agents located in Washington. The
manufacturers offered their assistance
in stamping out the illegal system.
An Immediate result of the disclos-
ures was a letter sent by Attorney
General Gregory to heads OF all gov
eminent departments making war
contracts proposing that all future
contracts should contain a clause
pledging the manufacturers to employ
any third party in negotiations with
the government.
Washington, June 18.-A nation
wide conspiracy between manufactur-
ers and contractors agents in WASH
solicit
ders under an agreement to pay COM
missions illegally to the agents, was
disclosed today by the department OF
justice. simultaneously with the an
nouncement raids were made on hum
dreds of manufacturer business Off
ces turnout the United States in
search of papers showing the scope or
the illegal practice, and four Boston
business men were indicted in WASH
ington on charges of acting as con-
tingent fee agents. Officials indicated
they had evidence that perhaps hum
dreds of contracts have been made
with manufacturers who were under
pledge to turn over to contract conn
mission agents in Washington, New
York ard elsewhere a percentage of
their profits.
Agents Claimed Special Influence.
Officials said the manufacturers
were led to enter into the agreements
by assurances of the agents that they
had special influence with army Off
GERS or others in charge of letting
contracts and under threat to use that
influence against the manufacturers.
Officers May Be Involved.
This development led to investiga-
ton of the relations between certain
army officers and these-agents and
altho there is no definite indication
that these officers are knowingly in
volved in the conspiracies, Secretary
Tlolr t. - Sr1ry Trrut f,yD
in connection with the department of
Justice
Secretary Daniels is also keeping in
close touch with the investigation and
the whole situation has been called
to the attention of President Wilson
and his cabinet.
Contracts Can Be Annulled.
The guilty commission agents will
be prosecuted under conspiracy stat
utes and all contracts made by them
or with their aid are subject to an
nulment by the government
New York, June 1S.-An army off,
Ger was arrested here today in con-
nection with the nationwide search
for graft in the probe of government
contracts. The arrest, it was believed.
only foreshadows similar seizures in
various sections.
Papers from more than fifty firms
working on contracts were seized dur
ing raids and have been forwarded to
Washington. Dummy firms, it was
shown, have been used to get con-
tracts for army goods.
Papers Seized in Philadelphia.
Philadelphia, June 1S.-Government
officers here have seized papers in
fifteen business houses, the heads of
which are under investigation on
charges of profiteering in connection
with war contracts
tn nr FlFnr nnuHnFn0