Evening star., 1951-02-25
RFC Probers Expect
White House File Of
Letters 10 Backfire
By Robert K. Welsh

LOilotl AIVIOIl AldllCC AOIp. SdlC
last night that testimony about Q
White House collection of letters
from members of Congress to the
agency would help the inquiry into
alleged RFC subservience to out,
side influence.
They predicted help" might de.
velop from two angles:
l. Instead of embarrassing con.
gressional correspondents, disclos.
ure of the White House reques
for 700 to 900 letters pointedly
mentioned Donald Dawson, ar
aide to President Truman. Some
RFC witnesses said he first re-
ceived the material from the
agency.
2. The White House move, In
the opinion of Chairman Fulbright
of the Senate Banking subcom-
mittee investigating RFC. might
backflre. Senator Fulbright de-
clared yesterday that "some bright
boy in the White House or RFC
thought he was going to shut
up the committee" He named to
names but limited that the SUBJ
committee may look into the mo-
tives."
Hotel Inquiry Delayed.
The subcommittee recent re-
port, basis for hearings that
opened last Wednesday and will
be resumed tomorrow, named Mr.
Dawson and others as having in
fluenced or tried to influence the
huge money-lending agency. Mr.
Dawson has not yet testified. Sen,
ator Fulbright said yesterday thai
Il don't anticipate he will be
called" unless he asks to appear
Disclosure of the White House
request to RFC-said by Senator
Fulbright to have come as a sur.
prise to the subcommittee las
Friday-have thrown the hearing.
so far off schedule that they may
60 well into next week.
That turn in the testimony de.
layed. probably until next Mon.
day, an airing of the story behine
a SIS million loan by RFC fol
construction of the sYank Saxony
Hotel at Miami Beach by George
D. Sax of Chicago.
Subcommittee sources said yes.
terday that witnesses will be askec
mainly whether the loan to lux.
ury hotel was in the public inter.
est and whether any big names,
especially of political figures OF
other Washington personages
have been carried free on the
guest list.
Loan to Sax Repaid.
Subcommittee Chairman Full.
bright and staff investigators have
seen the guest list but refuse tt
disclose whether they recognize
any familiar Washington names
A subcommittee spokesman sale
yesterday there is no intention tt
embarrass anyone who ever stayed
at the hotel-"because, after all
it IS a big hotel and a lot OF
prominent people stay there" He
said the object of the inquiry is
to learn whether Washington
outside" influence played a part
in RFC approval of the loan. de-
spite disapproval by RFC regional
officials in Florida
The loan apparently was sound
from financial standpoint and
Was repaid. The subcommittee in
executive session last Monday
questioned Mr.. Sax who has been
described in other quarters as a
punchboard manufacturer.
The subcommittee all but aban-
doned hope of winding up the
hearings this week. It plans to
examine at least two RFC loar
issues that have recently arisen
These involve a 81 million loar
to the Sorrento Hotel of Miam
Beach and an authorized loan o1
81 million to the Maxwell Co., g
Miami Beach dealer in restaurant
and hotel equipment.
Quiz About Dallas Office.
Despite the burden on its small
staff, Senator Fulbright said, the
subcommittee also expects to look
into a complaint by Reuben E
Hartman, president and founder
OF the Mobile (Ala.) Paper Co.
Mr.. Hartman asserted that con.
troll of the concern was "wrested'
from him. He wrote the subcom.
mittee that in order to get an RFC
loan he had to turn over his stock
interest "for next to nothing" te
relatives and business associates
Of Representative Boykin, Demo.
crat, of Alabama. Mr.. Boykin has
denied he put pressure on RFC OF
anyone else.
Meanwhile. the name of Mr.
Dawson as well as of E. Mer
Young, former RFC examiner
whose wife is a White HOUSE
stenographer. seemed certain te
come up again at tomorrow's hear.
ing.
Paul Cotter, chief of the RFC
Investigating division, has beer
called as a witness. Subcommittee
sources said he will be asked
whether Mr.. Dawson or any othel
outsider" in Washington triee
to interfere with the RFC office
in Dallas. Tex.
Glidden and SkiIes Called.
The session will be confined as
far as possible to ''pinning down
evidence about conflicting claims
that Mr.. Young demanded ar
$4,000 fee to influence RFC in be-
half of a $40 million loan for the
TeXmass Corp. Ross Bohannon
the companys attorney in 1949
made that charge. Mr.. Young de-
MED it and said Mr.. Bohannon
made an offer of that kind.
L. B. Gl1dden, former manager
of the Dallas RFC Office, and Johr
B. Skiles. former personnel Officer
there, have been summoned tt
testify tomorrow. Subcommittee
l,,1,1 4I.~ k--,-