Evening star., 1940-08-09
Grand Juries 10 Probe
Political Activities
OF Three Utilities
= Z
Midwest Units Of Company
Thot Controls P.E.P.C.O.
Are Subjects Of Inquiry

At the direction of the Justice
Department, Federal grand juries in
st. Louis, Springfield, ILL.,, and Des
Moines, will inquire into allega-
tions Of illegal political activities by
three Midwestern units of the North
American Co., the billion dollar
holding system which controls 10
cally the Washington Railway q
Electric Co. and the Potomac Elec-
trio Power Co.
The probe was announced last
night, and o. John Roggc, Assistant
Attorney General in charge OF the
criminal division, plans to get 1t
under way in st. Louis Monday.
The department said in state
ment that it would investigate in
formation that certain companies
had kept false records for the pur-
pose of creating a so-called slush
fund and using this fund to make
contributions to candidates for elec-
ton to State and Federal offices"
The inquiry will center on Union
Electric Co. of Missouri, with more
than $3.50 900 900 of assets; Illinois
Iowa Power Co., with about $780,
600, 900 Of assets; Missouri Power
and Light Co. with some 1920. .000,-
900 of assets, and certain af1iliates.
Three Men Already Sentenced.
The three companies have been
under investigation by the Securi-
ties and Exchange Commission, and
three men already have been SEN
fenced for perjury growing out of
| this case. Frank ]. Boehm. former
| $42, 2,000-a-year vice president of
Union Electric, received the maxi
mum term of five years in Federal
District Court Saturday.
The Commission said 1t would de-
fer its public investigation of the
North American Co. and Union Elec-
trio, announced May 6, in view Of
the Justice Departments investiga-
ton. The Union Electric inquiry
had been under way privately since
November, 1888.
A private inquiry into Illinois Iowa
Power & Light Co. and the Des
Moines Electric Co. was begun last
spring.
The Department statement said
its information was obtained from
the S. E. c. and during the trial of
Boehm.
A Long Dispute.
The grand jury investigation be-
gins new chapter in a long dis
pute between Union Electric and
the Government.
About five months after the Union
Electric investigation was started,
the S. E. C. announced 1t intended
to make it public inquiry. Union
Electric fought this move and asked
the Federal District Court here for
an injunction. The matter was
settled when the company and the
S. E. C. reached an agreement
whereby the investigation would re-
main private and the company
would cooperate with the Com
mission.
More recently, however, Edward L.
Shea, president of North America,
asked that the commission disclose
what 1t had learned thus far in the
Union Electric case and also that it
make public investigation, instead
of a private one. of the charges con-
corning Illinois Iowa Power and as
sociated companies.
The commission denied this re-
quest, after saying its attempt to
make a public investigation previ-
ously had been opposed. 1t explained
also that public hearing might
unnecessarily damage regulations
against whom charges were not sus-
tanned.
Seven Union Electric officials were
replaced after the investigation was
started.