Evening star., 1946-08-13
Cosf-PIus Contract
Blamed for Billions
In War Waste
Continued From First Page.)

are just that-they don't purport
to be a complete record, even with
reference to the contractors who
will be named.
They were selected from more
than 1000 auditors reports exam
ined by this reporter. They show
the pattern-but If repetition would
add anything to the conclusions
the reader may reach, they could
be multiplied many times. This
would be true even of the COM
panies which will be identified,
and reports on many companies
which did precisely the same things
will not be mentioned. They were
eliminated simply because they were
repetitious of conditions amply dem
onstrated in the reports selected
for publication.
Found by Investigator.
In this category, the investigator
finds such things as:
Production of parts fantastically
out of proportion to the total re-
quired for delivery of the complete
item.
Charges to the Government for
materials which were not produced.
Plant amortization charged off in
one contract and charged off again
in subsequent contracts.
No credit given Government by
prime contractors on price reduc-
tions negotiated with subcontractors.
(That is the prime contractors billed
Uncle Sam at the higher original
cost of supplies they used and
when a reduction was made sought
to pocket the difference)
Sale of scrap by contractors with
out reducing the cost of the orig
inal material to the Government.
Unconscionable Rentals.
Unconscionable rentals paid for
equipment used by contractors
equipment which, in some cases,
could have been purchased for less
than what was paid for short time
rental.
Sometimes the Government pro-
vided necessary parts or equipment
and the contractors forgot about
this-adding to the "cost" portions
of their bills what they would have
had to pay, if the parts and equip
ment hadn't been given to them for
free.
Only contracts have been men
toned in the preceding paragraphs.
The reader ought to have in mind,
however, that wherever there was
contract there was contract
officer. representing the Army, Navy,
Maritime Commission or some other
agency of Government, who passed
on these matters and approved
them.
1t was not until the General Ac-
counting Office checked up that
they were challenged and the 200
million, plus, collected through that
office, was paid back to the Treas
ury. Such matters send shivers of
horror through the sturdy spine of
Controller General Warren. who
breads as the plague, gambling with
the public's money.
Who Did These Things?
We come now to telling who did
these things. The name of the
Consolidated Vultee Corp, Fort
Worth, Tex, will loom large in this
recital-not necessarily because it
was in any worse fix than other war
contractors, but because the GAO
reports on this company illustrate
more clearly than other reports
practices criticized by GAO and
common to many companies.
1 Here are five reports on Consoli-
i dated-Vultee. They aren't all the
CIV reports in the GAO Office by
a long shot. But in these five the
company is shown to have paid
back to the Treasury more than
s14 900, GOO for which it had improp-
erly billed the Government.
First is an item of $9,972 ,308-
and 10 cents. GAO auditors re-
ported in this instance that CIV
had been supplied by the Govern
ment with airplane parts purchased
by the Government from another
contractor. The Government paio
the supplier and paid CIV for the
same parts. Eventually it got its
money back, from CIV.
Exchange of Plane Parts.
Second-a deal involving the ex-
change of cargo plane parts for
bomber plane parts. The cargo
plane parts had not been thoroughly
finished and CIV made a charge
against the Government for finish
ing them. But the cargo plane parts
under the Governments contract
with their fabricator, should have
| been finished. From CIV the Gov
eminent collected 1885, SOL. Records
available here do not show whether
CIV got the money back from the
other manufacturer.
The Government was charged
S265 .594 as the cost of airplane
parts made by CIV when the con-
tract did not call for enough air.
planes to use all these parts. The
money was recovered.
We paid-and later got back
$133, ,686, claimed by CIV for manu-
facture of more parts than were
paodod RI converf hor,herS tn trans