The Waterbury Democrat., 1933-06-09

Contempt proceedings" replied
Fletcher.
Private stock transactions of
three Morgan partners are sched-
uled for inquiry. The partners are
William Ewing, Harold Stanley
and Thomas S. Lamont, son OF
Thomas w. Lamont.
On December 80, 1880, young
Lamont sold six blocks of stock
aggregating 5,0S7 shares. Senate
Investigators said that his wife
an attractive young woman who
regularly has attended the hear
ings-purchased similar blocks the
next day.
John w. Davis, Morgan counsel.
| denounced and denied senate au-
thority to go into matters relating
to the income tax payments of the
partners he represents. But
whether the lawyer will advise his
| clients to risk contempt proceed
ings with a refusal to testify has
not been revealed.
An interlude of evidence on bar
| gain stock buyers and perhaps on
railroad finance may delay income
| tax questions to-day. Pecora plans
to put into the record the last of
the bargain stock lists. 1t contains
names Of persons invited by the
bankers to subscribe at a profit to
shares of the Johns Manville cor
poration, maeufacturer Of builders
supplies.
The story Of high finance devcl-
oped by the investigation reached
its climax in the testimony of o.
p. Van Swerirgen, one Of the ia
hrAfh ne r1avAtond
Pecora put into the record an
estimate that in their Anal railroad
holding company created with the
aid Of J. P. Morgan & Co, the Van
Sweringen interests accumulated in
| 1929, a paper profit Of just over
| SOC, 100000. This was through ere.
alton of the Allegheny corpora
ton. They put into the corpora
ton railroad securities worth APP
proximately $52,000.o00.
INCOME TAX PROBE STARTS
Washington, June 9.-UP)-
The senate investigation Of j. p.
stock transactions enabling part
income taxes.
AS Thomas s. Lamont was called
to testify, spokesman for the
Morgan interests, declaring I'VE
have nothing to conceal" said
there would be no opposition to
answering any Of the committees
question regarding income taxes.
| Lamont, who Is called young
Tom" by his friends told Ferdinand
Pecora, committee counsel, that he
had refreshed his memory and now
recalled the stock transactions re-
garding which he could remember
nothing last Friday.
Lamont was granted permission
to make a statement.
| Agreeing that he had sold the
stocks, Lamont said:
my wife purchased In the mar
ket similar amount OF the shares
sold publicly"
The statement continued:
"She purchased them for cash
and borrowed an equal amount
from me, upon her. demand note
which. though not specifically col
lateralled, was well covered by the
shares themselves plus her other
personal estate.
Proper transfer stamps were af-
fixed to each transfer; the usual
commissions were paid to the brok.
ers where securities were sold
through public sales"
Lamont said he sold four blocks
Of stocks publicly on December 80
and 81, 1890. and on December 80
1880 four blocks directly to his
wife.
On April s. 1881, the young
banker testified. he repurchased
the securities from Mrs Lamont.
IT believe" he said. that I act.
ed fully within my rights"
Lamont's statement revealed thai
his income tax return and that OF
his wife contained errors in their
favor aggregating $2.035.S6. He
described these either to clerical
errors. ''or they could come from
some error on my part in the han
ding of my affairs"
Lamont insisted there had beer
no agreement with his wife. Early
in 1891 the securities seemed to be
lieve Mrs Lamont of them"
did you sustain any loss?"
81 did"
How much?"
"sl14,so7." Lamont replied.
His statement continued:
II am told, that even IL my taa
deductions growing out of the loss
on all the above sales except those
made publicly were eliminated. II
would result in an additional taS
of $1.440.2s in my return and
S5s5.57 in my wife's.
II always understood that the
bureau Of internal revenue regu-
farly examines the tax returns
made In our office and that when
ever they find mistakes they call
our attention TO them. ] have been