New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1920-05-14
Bought 4 Ships
On $40 Account
Says Witness
E. A. Moulton Testifies
to Giving Morse His
Checks for $4,000
OH Purchase of Vessels

The select committee Of the House
of Representatives investigating the
United States Shipping Board ad-
journed last night and returned to
Washington to digest startling infor-
nation gathered from an examination
of E. A. Moulton concerning shipping
deals with c. W. Morse They were
referred to by members of the COM
mlttee as fake transactions"
Moulton, Canadian living in New
Rochelle, after waving immunity from
osecution, told how he had "bought'
four steamships from one of c. W.
Morse's companies, giving check for
$4,000 on the North Avenue Bank of
New Rochelle. He had $40 on deposit
there
The examination of Moulton was pc
cUllarly illuminating, as he was called
after Ira Campbell, admiralty lawyer
and formerly general counse. of the
Shipping Board, had revealed the mo-
tlves that inspired the strange financial
deals.
Mr.. Campbell said that early in 1919
Chairman Hurley had given him a
bundle of documents with an explana-
ton that they related to proposed
agreement between the United States
Steamship Company (the parent Morse
company and the Virginia Shipbuild-
ing Company Otis subsidiary on a plan
to provide security for loan of $780,
600 from the Emergency Fleet Corpora
ton. Mr. Campbell explained that Mr.
Hurley wanted his opinion of the
agreement that had been presented by
the Morse companies.
Mr.. Campbell told the committee that
he learned that the Virginia Ship
building Company was in bad way
financially. 1t had already been given
S25o,o00 of the proposed loan of three
quarters of million, this instament
being secured by a mortgage on the
Virginia plant.
The agreement provided, Mr.. Camp
bell testified, that the United States
Steamship Corporation was to sell four
lake steamers, the Huron, Binghamton
st. Paul and Minneapolis, to companies
that would place them under Canadian
registry. The price, according to the
papers, was to be S750,0OO for each
ship.
The purchasers were to give $4,000
IN cash on each ship to pay the claims
Of minor stockholders and creditors
lhe rest OF the purchase price was to
be IN the form of demand notes. Mr..
Campbell testified it was proposed
that these demand notes be placed with
the government as collateral for the
loan to the Virginia Shipbuilding Cor
poraton.
Mr.. Campbell said he refused to ap
prove the deal. for the reason that moth
ing in the agreement provided that the
s5OO,000 which the government was to
put up should be used by the Virginia
shipbuilding company to build ships
He said this was the principal reason
for rejecting the application for loan
and it had not occurred to him the col
lateral was not all it should be-
When MQulton took the stand, Chair
man Walsh asked him if he would
waive immunity from prosecution that
might grow out of his part in the
affairs about which he was to be asked
to testify. If he would not waive the
committee did not want his testimony.
After rubbing his chin thoughtfully
/ for a moment, Moulton said ne was
willing to testify.
Moulton said he had been introduced
Continued on neat pase)
Don't Waste Time. USE