Evening star., 1941-12-16
Contract Lobbying
Denied by Corcoran;
Shanack Admits Fees
$4,000 Profit on
Brokerage Revealed
Within Yeur

soliciting defense contracts, while
Loen K. Shanack, one-time sports
promoter, acknowledged clearing a
$4,000 profit in 10 months handling
sub-contracts for s262, 900 worth OF
orders.
Mr.. Corcoran told Senate investi-
gators he had never received fee
and I have no arrangements for
receiving fees in the future, on per-
centage or otherwise, for contract
brokerage or for any other form OF
soliciting defense contracts"
Mr.. Shanack testified before q
House Military Affairs Subcom-
mittee, saying his expenses and
taxes totaled about S253, 900, leav-
ing an apparent profit of $4,000, but
added the expense items included
drawings" of $4,000. Under ques-
tioning he said the drawings" were
mot profits but for the work we've
done-dad and myself"
Admits $4,000 Profit.
$50 you admit to a profit OF over
$4,000 in 10 months?" inquired
Ralph Burton, committee investi-
gator.
Yes, sure" replied Mr.. Shanack
"a lot of people have made a lot
more than that"
At another point he said he did
not know anybody who worked for
nothing, and added: II won't"
During the examination Chairman
Faddis commented:
80 this was your contribution
to national defense in time of
emergency"
II resent that" snapped the dap
per New Yorker, slapping down on
the committee table his application
for enlistment in the Marines,
which he said had been denied be-
cause he was 81 years old.
He conceded that his bank bal
snce was $125 on November %,
1910. and over $4,000 on December
!, 194l.
The London born New Yorker, a
naturalized citizen. clashed at one
point with Mr.. Faddis as he was
being pressed over his connection
with the former American Commit
tee for Aid to the British Red Cross
Society.
Witness and Faddis Clash.
II don't know what all this has
to do with defense" he snapped
This is not a persecution. I want
TO say things I want to say"
You'll answer the questions" Or
dered Mr.. Faddis.
What is your name?" demanded
Mr.. Shanack. Who are you?"
I'm the chairman of the COM
mittee," retorted Representative
Faddis.
81 beg your pardon. I thought
that you were the sergeant-at-arms
or something. My humble apollo
gies."
The committee has produced wit
nesses and photostatic copies Of or
ders and records purporting to show
that Mr.. Shanack made profits
ranging up to 100 per cent in han
ding subcontracts for defense work.
Mr.. Shanack insisted that he
was fortunate enough to do the
job and do it right" adding that
had there been a kick-bac in re-
jections there would have been a
tremendous loss" He acknowledged
his profit was made without an
initial investment af capital. He
contended that he obtained defense
work on price-competitive basis.
Denies Receiving Fees.
Mr.. Corcoran was vigorous in his
deniel of defense fees. Il have re-
ceived no fee and I have no ar
for receiving any fee
that has in any way directly or in
increased the cost to the
Government of preparing for war"
he said.
Mr.. Corcoran has been in private
practice of law since resigning from
service Is months ago.
He was counsel for the r. F. c.
and resigned to help re-elect Presi-
dent Roosevelt last year.
Mr.. Corcoran started his testi-
mony by reading long statement
covering business activities with
which he said his name had been
linked in whispers" He departed
from the text of the statement to
declare:
There has never been a case or
q citI,otiap, that in
ficted with or compromised what I
stood for while in Government serv-
ice"
The witness first denied published
allegations that 'in concert with
Charles West, or otherwise, I acted
as an agent to procure a Maritime
Commission contract for the Sa-
vannah Shipyard Corp"
West Suit Pending.
Mr.. West, former Representative
from Ohio and White House con-
tact man at the Capitol, now is
suing the Empire Ordnance Co., an
affiliate of Savannah, for s687 900,
claimed as fee for getting Gov
eminent contracts.
ct have never had any business
relationship Of any kind with
Charles West" Mr.. Corcoran said
Mr. Corcoran said that he got
IS 900 fee from the Savannah Corp
fer advising the organization as to
the validity of proposed bond issue
of the Savannah Port Authority to
pay the corporation for building a
shipyard.
Mr.. Corcoran explained that the
fee actually came from the law firm
of Dempsey & Koplovitz of Wash
ington, which he had recommended
to the shipyard corporation when
he felt that he was not in posi-
tion to handle the case.
He later participated in consid-
Grafton of the bond plan, and
with other counsel recommended
against it.
Explains His Fee.
Senator Ball, Republican, of Min
nesota asked how long this service
covered and the witness said a
month. When the Senator sug-
gested that $4,000 was high for a