New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-08-15

which were held by the companv's gee
rotary and never cashed, not even to-
day
"tb) 4 Nero bookkeeping entry Of
100000 described as cost Of guaranty
fer the supposed service of another In
solvent Mayer corporation in acting as
guarantor of the contract between the
United States Mail and the Shipping
Board: and
''tc> Seven thousand and eight hun
dred shares OF ssill another Mayer cor
Hporation, which has no value. but which
for the United States Mails purpose
was nctltionsly listed ut S3S0,000
Revelation ia Finance
This transaction discloses hitherto
unrevealed method OF finance. 1t is
only necessary to summarize it to dem
onstratc it's character uncashed
checks. worthless guaranty Of an in
tcTiocking corporation, and the use of
vaiueless stock of still another inter
locking corporation.
THE Shipping Board constantly
sought to obtain from the company in
formation as TO it's financial ability to
execute the obligations accepted by it.
and also to examine its books in order
TO ascertain the financial results of the
operation of the boards vessels rented
10 IT. But the information was with.
held and the audit was never permitted.
In addition to the chartered trent
ed vessels, three ships were allocated
10 the United States Mail, and by the
terms Of the ALLEGATION the Shipping
Board agreed to pay the entire cost Of
operation and to give to the company
commission for its services. The
company gave every facility for the
audit of the accounts of these ships in
order that it might promptly obtain its
commission, and it did receive q total
commission of over $4,000. But, as
stated above, the willingness for audit
dId not extend to the chartered ships,
and the board was purposely kept in
ignorance by the company as to the
condition of the books with respect to
such ships
The contract between the United
States Mail and the former Shipping
Board was the result of numerous con-
ferences and negotiations between the
board and Charles Mayer. during which
the latter dweit largely upon his pur-
pose TO put the flag upon the north
Atlantic and his Willingness to spend
SlO,o00,000 which he claimed he mad
at hand for the purpose.
The contract called for the deliv-
cry by the board to the company of
fifteen former German passenger yes
sells which the United States had
seized during the war. These vessels
were the America, George Washing
ton, Mount Vernon, Agamemnon. Presi-
dent Grant, Susquehanna, Pricess Ma
toika, Pocah ontas, T otomac (fohmerlv
Antlgone), Amphion. Freedom Callao.
.toius, Huron and MaGawaska.
Agreed to Defray Costs
".As the vessels had been Quilted dur
ing the war. in order to be used as
transports, the Shipping Board and the
company knew that q great deal Of
money would have to be expended to
put them in condition for passenger
service. This work is technically called
recondltioning. The company agreed
not only to pay all expense of manning,
equipping and operating the vessels,
but also to pay all the costs of such
recondItionlng, and to charter (rentl
the vessels for five years, at the end Of
which time the Shipping Board agreed
to take back the vessels and pay the
company 621a per cent or the amount
the company had spent on recondition-
ing or TO sell the ships to the company
and deduct from the sale price O large
part of the reconditioning expense.
Immediately after the contract was
IS - ~->> Vim p~Ht > iiA0iASAd1 lHdbilit
developed and it began a persistent
gn to evade its explicit obliga-
ton TO recondition, and to induce the
former board to pay all the expenses of
such work.
THE company supported its plea by
claiming that the vessels we're not sea-
worthy, and that they had been repre-
sented as oil burners instead of coal
burners, though the contract required
them to accept the ships as is When
the company finally confessed its utter
inability to reccndition, it argued, per-
sisted, and at last persuaded those in
authority to expend upward of $780,
coo in reconditioning the ships, though
the contract specifically provided that
the company should pay such expenses.
The payments made by the Shipping
Board for the work done on each ship
were as follows:
Freedom Observation-Disclosures. s3S1oa5s
ni@rica 814,a44. 81
l..