New-York tribune., 1920-11-18
Ex-Assistant to John b.
Payne Says Most Went
to Marine Gamblers in
Norway and Japan
$240, 100000 Found
TO Be UnrecOrded
No Definite Account of
$500, 900, of
Materials Distributed

OF the $3,400OO0,OO0 expended by the
United States Shipping Board s2,OOO,-
100000 has been utterly lost to the
government in the amortization of ships
Martin J. Gillen, formerly executive as
sistant to John Barton Payne, chairman
of the board, told the Congressional
committee investigating the boards af-
fairs yesterday.
Mr.. Gillen also servedffor a time as
assistant to Admiral William S. Benson,
present head of the board. He recently
declined an appointment by President
Wilson to membership in the body.
Among the astounding charges he made
yesterday to the committee we're:
/. The two billion dollar loss was by
no means due entirely to natural depre-
citation of tonnage values, but was in
.arge part caused by the gambling in
ships by Japanese and Norwegian COM
panies that sold tonnage to the Ship
ping Board and also to the exorbtant
rates Of profit paid to men operating
Shipping Board vessels. Many millions
of dollars have been thrown away in
cverpayments to ship gamblers, Mr..
Gillcn said
S300,O00,000 UnaccOuntcd For
2. The accounting system of the
Shipping Board broke down completely
two years after its establishment. Up
to October, /, 1919, accounts of only
eight of 5000 voyages of Shipping
Board craft had been audited. There
are no definite accounts of more than
$500, 100000 worth of material ex-
pended
3. Vouchers to the amount of $2,70O,-
100000 have been presented to Con-
troller Warrick. He has refused TO ap-
prove $900,O0O,000 worth of these for
lack of proper supporting data. The
Shipping Board is still sixteen months
behind in it's accounts
4. Alonzo Tweedale, treasurer of the
board, on taking Office August /, 1919,
two years after the creation of the
body, found that $500 100000 had
been paid out with only the vaguest
idea of what had become of it, No
balance sheets had been struck show
ing expenditures or money outstanding.
Some $240, 900 of securities had dis
appeared without record After search
these were found in the Grard Trust
Company at Philadelphia, where they
bad been deposited without any sub
mission of record to the Washington
office of the board
Ships Not Making Profits
5. The ships now operated by the
board are not only not making profits
for the government but are not earn
ing even depreciation and interest
charges. On the latter point Mr.. Gil
len fatty contradicted the testimony
given recently before the committee in
executive session by John H. Rossiter,
chief of the Division Of Operations.
g. The rates paid by the government
to ship operators for operation of ships
requisitioned on the high seas at the
time of the country's entrance into the
war were $50 per cent higher than
those paid by the British government.
These operators were allowed a profit
of 57A per cent at time when all
other war industries in the country
had been placed on 10 per cent profit
basis.
'"My investigation disclosed" said
Mr.. Gillen, "that the board had no rec
ords to show how much money it had
taken in during the war and how much
was expended"
Judge Payne, assuming the duties of
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