Evening star., 1943-08-22


being spent each month, some crooks
and chiselers were bound to come to
light. Realizing this, the Department
Of Justice shortly after Pearl Harbor
created a war frauds unit to see that
those who tried to defraud the Govern
ment were properly punished.
In the nearly Is months 1t has been
In existence the war frauds unit has
prosecuted about so cases. some of them
involving companies with nationally
known names. The wonder Is not that
some crookedness has come to light. but
that the total is, comparatively. so
small. The actual money involved, in
relation to the vast sums that are being
spent, Is small indeed.
while we've had numerous prosecu-
tions, by and large the integrity of in
dustry has not been challenged" John
Darsey, assistant director of the unit,
told the Post-Dispatch in discussing the
work. THE cases we prosecute are the
exception rather than the rule"
Most cases involve petty chiselers-
so-called agents who try to cut them
selves in on fees for obtaining Govern
ment contracts. Other cases involve
plain and simple fraud-the substitution
OF inferior material for goods which meet
Army and Navy specifications. Still
other cases have arisen not through any
desire to defraud or cheat the Govern
ment, but out of the terrible haste and
urgency of the war program and the de-
sire to set an impressive record.
Some Overoptimistic.
Many companies have taken on Gov
eminent contracts beyond even their
most optimistic capacity. They have
sought to maintain their prewar position
in the field they operate in and so they
have extended themselves beyond rea-
sonable limits to take on the lions share
OF business in that field. Or, again. they
have sought to maintain a monopoly
position in a particular field and this
has necessitated crowding out all COM
petitors. Some companies have been
persuaded by Army or Navy to take on
more work than they could do.
The Truman Committee recently made
public blistering report detailing
charges against the Wright Aeronautical
Corp. and the Curtiss- Wright Corn
Through excessive zeal of its statesmen
and relations built up with the War and
Navy Departments in prewar years. the
committee found, Curtiss- Wright has
enjoyed spectacular and unprecedented
success in obtaining war contracts" The
total on March l was s4,717 500, 900, more
than any other corporation except Cen
eral Motors.
The Truman Committee charges were
submitted to the war frauds unit of the
Department OF Justice. The unit found
that virtually no evidence existed for
action against the plane companies.
Spokesn1en for big business are insist
ing that such broadside charges as were
fired by the Truman Committee will
have the effect of slowing down the
whole plane program. Fearful of Senate
attack, plane manufacturers will insist
on such ironclad inspection as must in
evitably slow down their output. With
such an enormous volume of production
pouring out of the Nations war plants,
meticulous care and oyercaution are eer-
tain to mean delays. Already, 1t is ss.s
here, there has been drop in airplane
motors Which will shortly be reflected in
plane production.
While in many instances the delivery
Of defective material can be put down to
misplaced zeal and the inevitable haste
Of the armament program, in other in
stances there can be no such charitable
Interpretation, according to Darsey The
case involving the Marion, Ind, plant of
the Anaconda Wire e. Gable Co. is the
one most frequently cited by the Justice
Department.
Five Are Indicted.
Thor S. Johnson, general manager of
all Anaconda mills; Frank E. Hart, man.
ager of the Marion division of Anaconda,
and three other officers of the company
were indicted for conspiracy to defraud
the United States by circumventing test
and inspection requirements on Govern
ment contracts for cable and wiring and
also for defrauding the Government by
presenting false claims for payment.
When the case came up for trial, the
five pleaded nolo contendere, which has
the effect of a plea of guilty. Federal
Judge Thomas w. Slick sentenced john
son, Hart and one other officer to prison
but suspended their sentences over the
Indignant protests of the district attor-
ney and special prosecutors from the
Department of Justice.
Following Judge Sticks action, Sena-
tor Homer Bone of Washington devoted
more than two hours on the Senate floor
to denouncing the company and the ac-
ton of the judge He explained to the
Senate that an FBI investigation re-
vealed that Johnson Hart and the
others had set up an elaborate system
whereby cable tested was subjected to
only half the voltage called for in mill
tary specifications
After the disclosures by the war frauds
unit, Bone said, the Army Signal Corps
ordered all its supply depots to segre-
gate wire cable from the Marion Ana
conda plant and use 1t "for maneuver
and training purposes only" Around
TOO reels OF Anaconda wire were located
In Marine Corps warehouse at San
Diego, Calf, according to Bone, and 56
reels from the Marion plant were found
to be utterly defective" He also told
OF certified copies of two complaints
from the Moscow otice Of lease-lend
winch told Of numerous specific defects
IN the Anaconda wire. Bone charged
that the lives of soldiers and sailors In
the war zone had been put in. jeopardy