Evening star., 1943-07-12

Elk Hills, meanWnlle, hAo jumped
into the headlines in the early 1s20s.
when the Teapot Dome scandal
broke. There were two naval leases
involved-Teapot Dome in Wyom-
ing and Elk Hills. Secretary Fall
and Secretary of the Navy Edwin
DENLY leased drilling rights in Tea
pot Dome-Naval Reserve No. 3-to
Harry F.. Sinclair and similar privi-
leges in Elk Hills to the late Edward
L. Doheny.
The Teapot Dome affair might
have passed unnoticed. In April.
1922, the newspapers printed in
conspicuously an announcement by
the Interior Department OF n new
policy in handling reserves Of fuel
Gil for the Navy. contemplating
abandonment Of attempts to keep
the oil in storage underground. "
The policy, it was explained, I'm
wolves storage above ground OF
royalty oil derived from naval oil
lands in California and Wyoming
storage to be made by operators at
points on both coasts suitable for
quick supply to the fleets in emer-
gency."
La Toilette Demanded Probe.
But the quiet announcement did
not escape the critical eye Of the
late Senator Robert M. La Toilette,
ST. He denounced the deal in the
Senate and demanded an investiga-
ton. A resolution authorizing such
an inquiry was passed.
The Senate Public Lands Com
mittee took up the matter, but did
not actually begin probing it until
months later. Even then the inves-
tigation was largely routine until,
in January. 1924. it exploded over
every front page in the country. Mr..
Doheny testified that he arranged
a loan of 100000 for Mr.. Fall and
sent it In cash to the cabinet ofncer
in a black satchel. Mr.. Fall needed
the money, the oil magnate ex-
planned, to make Improvements on
his ranch in New Mexico.
The Senate took swift action.
Special counsel were appointed to
press cancellation of the two leases
and to Institute necessary criminal
proceedings.
Trials and appeals in the various
actions, civil and criminal, lasted
until recent years. But Secretary
Fall, who had been a Senator from
New Mexico before President Hard
ing gave him the cabinet post, was
the only person convicted of a
crime. He was found guilty Of ac-
cepting a bribe. He was sentenced
to year in prison and fined $780,
600. Mr.. Fall served nine months in
New Mexico prison. Now 81 and
broken in health, he is q patient in
a veterans hospital in the South
west.
Doheny Acquitted.
Four months after q District OF
Columbia jury convicted the former
Secretary of the Interior, Mr.
Doheny went to trial on q charge
of bribing Mr.. Fall. The same judge
presided and the same attorneys
were engaged. But this time the
jury brought in a verdict Of acquittal
Similarly, an indictment charging
Mr.. Fall, Mr.. Doheny and Mr.. Sin
clair with conspiracy to defraud the
Government failed to stick.
The civil suits brought in Wyom-
ing and California resulted, at first,
in opposing decisions. A Federal
District Court in Los Angeles held
that the Pan American Oil Co., then
controlled by Mr.. Doheny, must re-
turn Elk Hills to the Government.
A court in Cheyenne held the Tea
pot Dome lease Ito the Mammoth
Oil co.. valid.
Eventually the Supreme Court
vacated both leases, holding that
fraud and corruption tainted the
contracts, and they were an illegal
exercise of executive authority. And
so the Government regained It's
holdings on both Of these immensely
valuable oil fields.
While it should be emphasized
that the Standard Oil Co. was not
involved in the Teapot Dome scan
dal, the Elk Hills contract now un-
der congressional scrutiny - which
Secretary Of the Navy Knox ha,
ordered cancelled, on advice Of tha
Justice Department-has been de-
nounced by Assistant Attorney Gen
eral Norman M. Iittell in . forma
opinion as going beyond "in degree
the Teapot Dome leases. But neither
Mr.. Littell nor any one else ha!
charged fraud in the new agree
ment. To date the controversy ha.
centered around the legality OF tn
contract and the question Of wheth
er 1t was sound public policy.
THE third chapter IN this Sc
ries ptH appear tontorroD.L