Evening star., 1924-04-22
EXPLAINS VANISHING
OF SEIZED LIQUOR
Justice Official Blames Petty
Graft" for Disappearance
of Intoxicants.
LUMBER CASES ARE CITED
Thompson Says Daugherty Sighted
Price-Fixing Data.

from the department lnTOuSH pSttS
graft was placed before the Daugh-
erty investigating committee today
toward the end of a long session de-
voted largely to testimony by Chair
man Thompson of the Federal Trade
Commission about the departments
failures in prosecuting lumber inter-
ests under the antitrust laws.
w w Grimes ot~the Justice De
partment, who said he was acting by
direction CT Attorney General Stone,
read a report by tcial Investigators
into the liquor disappearance 1t
did not show whore the goods Went
however, and contained nothing bear
ing on previous testimony that some
of it was taken to the private home
of former Attorney General Daugh-
erty.
The witness declared there was
nothing in the law TO permit destruc,
tion of liquor seized in trunks and
other baggage and never claimed.
Consequently, he said, a large sup
ply had accumulated and some OF IT
had vanished mYSteriously. lie in
sisted, however that "petty graft of
that kind might be expected in any
large government department.
Declares Burns Drastic.
The first departmental investiga-
ton into these disappearances, Grimes
said, was made by an agent named
Cox, whose report showed little as to
who was responsible.
wasn't the Cox report made to
whitewash the department?' ask ed
Senator Wheeler, tho committee
prosecutor.
III say this" replied the witness
Cox wasn't a regular investigator.
w. J. Burns when he came in fired a
number of people and had his own
investigation made. This second in
vestigation disclosed a somewhat
different set of facts than the Cox
report.
Mr. Burns was very positive in his
action" Grimes said
Senator Wheeler suggested that
hospitals in Washington could take
it. Grimes said they got some and
read from the Cox report a statement
that DIR. James F. Mitchell. Il Wash
inRton physician, got Il truck load
OF it.
Price Fixing Charged.
Turning from conditions in the to-
bacco industry, which he described at
length yesterday. the chairman there
upon related how he and his COL
leagues uncovered price fixing and
'coeTcive measures" among lumber
producers in an investigation begin
ming in 1919. The results of the in
quiry, he said, were laid before the
Justice Department before Mr.
Daugherty took office. Suit against
the Southern Pine Association was
instituted in the closing days of the
Wilson administration, he declared
but has remained in status quo ever
since and now rests in the district
court al Kansas City.
The southern Pine Association, Mr.
Thompson explained, included most
OF the large manufacturers of that
commodity
The Investigation as we reported
IT to the Department of Justice he
said, showed price-fixing and price
regulation and production restriction
ny dnferent groups of the Southern
I'ine Association and coercive meas
ureS toward various concerns to make
association
There were fourteen organiza-
tions IN different parts of the coun-
try, such as the West Coast and North
eFn Hemlock associations. We made
Investigations of them all"
Consent Decree Refused.
The Department of Justice pro-
posed at one time to let "a consent
ern Pine Association, and letting it
continue some of its operations.
We refused that the witness said,
because it would be just like let
ting a criminal go with the gun still
in his haI.is."
John III. Kirby of Texas, Mr..
Thompson said, had been head of the
Southern Pine Association. Senator
Wheeler read into the record a speech
hU Nr in nrl
last month, vigorously defending At
torney General Daugherty and Secre-
tary Fall.
NO criminal prosecution of any
kind has ever been brought?' Sen
ator Wheeler asked.
NO, sir"
Notwithstanding, the evidence
shows conclusively there had been
violation of the criminal statutes?'
Il don't want to say conclusively,"
that is the point for a jury, but to my
mind there is no doubt about it"
Lumber Prices Soar.
Chairman Thompson said that ium-
ber prices had gone UP during recent
months ito points higher than they
were during the war"
Tn the spring of 1921" he pro-
ceeded. two attorneys from Colum
bus, Ohio, came down to see Attorney
General Daugherty. Nothing has been
dnne since"
He was asked if j. Z. Todd, Daugh-
erty's former law partner, was one
of these lawyers, but said he had no
positive Information as to their
identity. The witness declared the
Southern Pine group had financed the
build your own home" movement
Il tI,- t.aiC aA -Hrio
Taking up the case of the West
Coast Lumber Association, he said
that in 1920 the Trade Commission
presented a report seeking prosecu-
tion OF that organization.
Charges General Conspiracy.
Nothing has been done since he
said, land no action taken. There
was a better sentiment out there and
they were not SO well organized as
the Southern Pine, but they soon got
together, and joined in the build
YOUR own home deal Prices mount
ed-they ran them up to the levels
corresponding 20 Southern Pine.
My opinion is that the evidence is
much more direct as to the west
The witness declared there was
strong evidence of a general con
spiracy" among lumber associations
resulting in high prices and in very
considerable profits to the lumber
manufacturers"
Against the Western Pine Associa-
tfon, Mr.. Thompson said, the Depart
ynent of Justice did file civil suit
in 1929 Outside of this, he said, no
action was taken.
George H Chamberlain, counsel Tor
Daugherty, asked why the Trade
Commission had not instituted suits
in it's own account
= .Overwhelmed With Work"
we are going, ahead on many