Evening star., 1932-10-04
FALS|TY CHARGED
. IN UT|L|TY'S BOOKS
Examiner Says Evidence of
Work in $2,55O,OOO Item
for Building Lacking.
BY the Associated Press.

Examiner Charles Nodder today told
the Federal Trade Commission that
there was mo evidence obtainable" that
the General Construction Corporation
of Washington, D. c.. had actually done
any work for the $2,550,000 construc-
OF the Clarion River Power Co.'S books
for building the Piney Hydro-Electric
project on Clarion River In Pennsyl-
-vania
Nodder testified in the investigation
OF public utilities that has been on since
ordered in 1929 by the Senate. He
submitted formal report of his find
ings of the Clarion River Power Co.'S
financial structure.
This company was acquired by the
Associated Gas & Electric System in
1925 and the total book cost was listed
at S10,985, 1888 on January l of that
year.
The inquiry today, however, was di-
rected at the companys development
from 1912 to December 81, 1924. when
it was disposed of by H. D. Walbridge
& Co. of Washington.
Walbridge Co. In Control
Walbridge & Co. controlled the Cen
eral Construction Corporation, Nodder
said. at the time it was given the con-
tract for construction of the Piney
project.
Relative to the charge of $2,550 900
made by the General Construction Cor
poration for general engineering and
supervision, there is no evidence OBJ
tainable that any work was actually
done by that company Nodder said.
"All the available information indi-
Gated that the charge made by this
company covered discounts on securi-
ties as well as a possible bonus to
some company.
Nodder testified that the actual work
i'll constructing the Pney project was
dcae by Charles B. Hawley & Co. of
Washington for 4 fiat fee of $400, 900
and that vouchers showing expendi-
lures totaling s4,420,907 were in evi-
dence.
Nodder presented report from the
Clarion River Power Co. to the Federal
Power Commission on December 81,
1924, listing the expenditures claimed
by the promoters and constructors OF
the project
An expenditure claimed by J. R.
PAUL. who promoted the development,
was listed at S45l 600; expenditures
claimed by H. D. Walbridge & Co., 81
929,32S, and expenditures claimed by
the General Construction Corporation
of 1906, ,40l, or total OF Sl0,985,729.
In summary of the payment for
construction Of the Piney project, Ned
der listed total reported disbursements
at sl0,985, 729. with physical assets at
SIS ,922 ,629 and discount or Intangible
assets at s5063, 100.
At the same time, however, ne sub
mitted to the Trade Commission re-
port Of Examiner Tomlin Of the Fed
eral Power Commission, showing ex-
penditures Of the General Construction
Corporation. backed by vouchers, at
S4 42O9O7 with intercompany trans
actions, including the S2,o50,000 item
of the General Construction Corpora
ton at S2,986957, with land purchases
at Sl52, ,799 and an adjustment amount
ing to S44,736, for total of $7,605, ,40l.
Increases Authorized.
Nodder testified that j. r. PAUL Of
Pittsburgh, who promoted the develop
ment Of the company, had entered into
an agreement with H. D. Walbridge q,
Co. in 1920, but that the deal was not
Walbridge g. Co. acquired 81 per cent
OF the common stock at value OF
S65, 900, Nodder said The board OF di-
rectors then authorized an increase to
$50 O65 600 in stock and an increase in
bonded indebtedness from nothing to
S25 900, 900"
The stock was alocated at $50 shares
of common at SlO0 share; Sl5,000.000
class A. 3 per cent preferred stock and
SIS 900 900 in participating stock
During the course of the examina-
ton, attempts were made without sue
cess by the examiners Of the Federal
Trade Commission to secure the records
of H. D. Walbridge & Co. OF Wash
ington, D. c., and the contractors and
4, engineers. c. B. HaWley g. Co. of Wash
ington. D. c., with respect to the con-
struction and financing of the Clarion
hydro-electric project" Nodder said.
For this reason the examination had
to be made from the other available
records, consisting of reports of exami-
nations made by the representatives OF
the Pennsylvania Public Service Com
mission. the Federal Power Commis-
sion, the company's records, various A.
nancial publications.