Evening star., 1932-03-15
JOHNSON LAUNCHES.
ATTACK ON LOANS
Hits "Greed" of FinancierS
and Cites Big Loss to
u. S. Public.
BY the Associated Press.

By the Associated Press.
Summarizing the Senate Finance
Committees investigation of foreign
loans, Senator Hiram johnson told the
Senate today that American losses were
due to the greed" of international
banks and "smug complacency and
supine indifference" on the part of the
Government.
The California Republican, who spon-
sored the investigation Of American
losses IN foreign bond issues, startled
the Senate with the ferocity Of his at
tack on international bankers.
In a scathing denunciation Of their
activities, ne said they had given mo
thought to the impoverishment of
American citizens who trusted them and
acted apparently only for the profits. +"
Cites Colombian Loan.
johnson made his more vigorous at
tack on loans to South American coun-
tries, which, he said, were made to
maintain dictators in power" made
to go hand in hand with concessions"
and sometimes made simply to obtain
securities of unproven value, to foist
upon the American people"
He directed particular attention to
the $4,000,000 advance by the National
City Bank to Colombia in 1880, shortly
after the government of that country
restored the valuable Barco oil conces-
sion to the Mellon-owned Gulf Oil Co.
and other American interests.
Whatever excuses may be made"
Al cnfI - hon snn ftn zf
American Representatives abroad may
be sealed, despite the pretense of pro-
tecttng confidential communications
that only International Banks may
know, We find the controversy about
the Barco concession running side by
side with the controversy about with
held money of the National City Bank,
and the concluding episode of the con-
troversy, the passage Of the Barco con-
ceSsion, and the payment of the amount
Of the loan withheld.
Thus the Mellon interests received
their due" the Colombian government
got its money, and the State Depart
ment kept its secrets"
Scores Stimson's Secrets.
In mentioning the State Department
secrets, johnson referred to Secretary
Stimson's refusal to turn over to the
committee except confidentially the
messages exchanged by the department
in reference to Barco concession.
A 100000 loan, which had been
contracted for by the National City
Bank the year before, was finally for
warded to Colombia 10 days after the
Barco concession was restored
johnson said that neither by word
nor deed" was the Government liable
to do aught for those who hold" $780,
900, 900 Of Colombia bonds facing pos
sible default
1T can, however" he said, when the
occasion, in its opinion demands it, act
for the Barco concession owned by the
Mellon or the Morgan interests in Co.
lombia and be the go-between in a
short-term loan of the National City
Bank to that country
Turning to the $415,000 commission
paid to Juan Leguia, son of the former
President of Peru, for aiding in the
negotiation Of 500, 100000 of loans to
that country, which are now in de-
fault, johnson said:
eff this sum had been paid by the
international bankers and they them
selves had furnished the money, and
it was now their loss, we might pass
it by with a mere reference. but the
bribe, for bribe 1t was, paid for the
privilege of selling unsound Peruvian
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