Evening star., 1951-03-28
Casey Defies RFC Committee
On Ship Deal, Bringing Call for
Maritime Commission Inquiry
FuIbrieht Indicates
Broader Investigation
Involving Surplus
By Robert K. Welsh

man to give information about a
company that made huge profits
from selling ships it bought from
the Government caused a demand
today for an all-out investigation
Of the Maritime Commission.
Joseph E. Casey, former Demo-
cratic Representative from Massa-
chuSetts, refused to give to a
Senate subcommittee investigating
the Reconstruction Finance Corp.
any details of company that was
capitalized for only 100000 but
netted $28 million for sale of five
tankships last year.
This refusal prompted Subcem-
mittee Chairman Fulbright to de-
clare:
This might we'll touch off a
broader investigation of the Mari
time Commission. 1t seems to me
to be a proper thing for the Sen
ate Expenditures Investigating
subcommittee to handle. Congress
and the public have a right to
know everything about the dis
posal of those surplus ships and
the Maritime Commission policy
in general"
Casey Questions Authority.
The chairman noted that Mr.
Casey testified that the company
he headed, the American Overseas
Tanker Corp, bought five of ap-
proximately 400 tankers that were
available from the Maritime Com
mission in 1947.
In refusing to furnish names of
stockholders and financial data,
particularly tax records of the
company, Mr.. Casey told the sub
committee that his fellow stock
holders believed the subcommittee
lacks authority to look into affairs
OF a private company that had no
dealings with RFC.
That problem, Senator Full
bright announced at the close of
the hearing. will be discussed later
by the full subcommittee. He
agreed. however, that the "iuris-
dictional line has to be drawn
somewhere.
Fulbright Explains Stand.
But he said he doubted that
his subcommittee had to "stop
short at this particular point" in
examination of a business matter
involving Mr.. Casey. who previ-
ously had been linked to many
RFC transactions.
81 don't concede that we have
no legal power to continue this
line of questioning" Senator Full
bright explained. "I neverthelessI
don't want to be dogmatic. 1t is
essentially a question of the in
ternal distribution of congress
sional power among committees or
subcommittee. I doubt that Mr..
Casey as private citizen, has
the standing to raise that ques-
tion which is a question of judg-i
ment by Congress-"
Mr.. Casey said he and his 30
to so fellow stockholders in the
tanker company would not object
to an inquiry by a duly author
ized committee" He contended
that such an investigation would
show that the conduct of the
company and its stockholders was
entirely proper and wholly above
criticism"
Bricker Brings Up Tax Laws.
Senator Bricker. Republican, of
Ohio interrupted to assert that
even if the company's transaction
in buying the ships from the Gov
ernment and then selling them
was legal, "it clearly demonstrates
that there is a loophole in the in
come tax laws"
The Ohio Senator called atten-
ton to Mr.. Casey's testimony that
the company paid only a rela-
lively small capital gains tax and
no income tax on the sale of the
ships.
In prepared statement after
the hearing Mr.. Casey explained
that his company followed an es-
tablished procedure common to
many types of businesses in leas-
ing the tankers to the Standard
Oil Co. of New Jersey during the
three-year period before his COM
pany sold them to another con-
Germ which he did not name.
over a period of time" he
stated, "the oil companies have
adopted policy of owning about
half Of their tanker fleets and
chartering the other half for
varying periods of time. The
prime reason is one of financial
consideration. They don't like to