The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1922-04-02
Central Figure in Sale of
Magnetic Co. Makes
Statement.
WILL PROSECUTE,
is CRIM'S PLEDGE
Kern Secretly Landed in
U. S. and Quizzed by
Federal Agents.

'NP"' N'"'hh VI ~ hShiNV
are in complete possession of the
details surrounding the sale of the
vast Bosch Magnetic Company prop
critics by former Alien Property
Custodian a. Mitchell Palmer, ac-
cording to statements made by gov
ernment officials last night.
These details were supplied py
Martin f. Kern, central figure in
the gossip which resulted from the
sale. during a three-day quiz just
ended. in the Offices Of the depart
ment here. it is said.
Kern arrived here last Monday.
after having been secretly landed
at Providence, r. l., from a tramp
steamer on which he had made his
return to this country from France
March 26.
High OmciaIs Involved.
stenographers were engaged for
three days in recording his state
meHts. or Confession" as Depart
ment of Justice officials term Il,
after which he left this city under
the guard of a department opera
tive. supposedly to return TO his
home in Allentown Pa.
Although the details of the state
ment are being carefully withheld
by the authorities, it is understood
that it seriously involves" a NUM-
Der of former and present officials
high in the government service.
Assistant Attorney General John
w. II. Grim, chief prosecutor for
the Department OF Justice. last
night admitted that he had spoken
with Kern and that he had made
progress" in the case.
Prosecutions Predicted.
Il spoke at length with Kern. and
have made some progress in the
Bosch case. but at present am
unable to divulge any OF the details
OF our conferences" said Assistan,
Attorney General Grim.
II have this case in nv YES,
pocket. for l have learned that bet
ter results can be obtained in cases
Of this nature by clamping the lid
down on publicity prior to prosecu-
tion time. This Is a case which
will. l am certain, warrant lengthy
prosecutions. and therefore am
not at liberty to discuss any Of the
details involved"
Federal grand juries in New York
and Boston are Investigating the
Bosch sale. Valuable documents
bearing on the transaction are al
legged to be missing from the files
OF the Alien Property Custodian's
ONCE here, thus making the case
one of unusual Importance. and in.
voIving some of the most pron,f.
nent men in this country.
Strong Demand for Probe.
Demands for a thorough and un.
tiring investigation into the details
of the transactions which led 70
the sale of the Bosch Company's
vast holdings have been made bv
powerful group in the Senate,
led by Senator William Hiking. of
Utah. and Senator George II. Moses.
of New Hampshire
Ever since the scandal regarding
the sale became broadcast a force
of Department of Justice operatiyes
have been accommodating evidence
in the case, which at the present
time is said to include numerous
letters written by prominent for
mer government officials.
Kern. who departed from this
country for France on the eve OF
the Department OF Justice investi-
cation of the transaction by which
he gained control OF the Bosch con-
Germ, was under constant surveiI-
lance of American foreign opera-
tives.
Yelled in. Secrecy.
His return to this country was
yelled in secrecy. lie was placed
on a tramp steamer and his identity
was withheld. and upon his arrival
in this country was taken secretly
from the vessel.
The Bosch properties were sold
December Z. 1918, by the then Alien
Property Custodian A. Mitchell Pal
mer. to H. c. Griffiths, of New
York, who is now alleged to have
acted as an agent for Kern. The
purchase price was s4.I5O.OOO al
though the nominal capitalization Of
the stock was s25.000, but when sold
by Palmer. 1t was declared to have
been actually worn slightly more
than s16,00O,0O0.
Following the sale by the gov
ernment, the name of the companv
was changed to the American Bosch
Magnetic Company. A sale of new
stock in the concern was under
written by Hornblower and Weeks.
of Boston, of which Secretary of
war Weeks was junior partner.
Palmer Defends Sale.
When the concern was sold bv
the government, the owner of the
of the stock was Robert
Bosch, of Stuttgart, Germany
When Palmer was nominated for
Attorney General by President VIII
son, June 80, 1919, the Senate held
up the confirmation for the time
because of charges brought against
him in the disposal of the Bosch
plant.
Former Attorney General Lewis.
of New York State, charged that
the price was "ridiculousIy low"
and that the price permitted OF
many persons making huge prof
IT'S"
Palmer declared that the sale was
unanimously passed upon by the
advisory committee OF the alien
property custodian's office, the
members of which were Otto +.
Barnard. Cleveland II. Dodge, Ralph |
I