Evening star., 1951-12-03


)OWN-Although a heavy snow
Beach, Calf, is warming up his ]
the case had been transferred
from the Birmingham district.
Rips and Mitchell entered
pleas Of guilty and were fined
and sentenced. The charges
against their wives were dropped
The case lnvoived several hun
dreds of thousands of dollars or
income the company was said tc
have received on the sale of jew
elry during the war to Army post
exchanges and ships stores.
Mr.. Mitchell testified that or
June 2. 1949. he Joined with other
investigators in memo conclud-
ing the evidence was not sufficient
to proceed with prosecution. Ac-
cordingly, he said the case was
returned to the Internal Revenue
Bureau with a suggestion that il
the bureau later found better
evidence. the department woulo
reopen it.
Were you personally satisfied
the case could not be proved at
that time?" asked Committee
Counsel DeWind.
Yes, think I was"
Mr.. Mitchell said the next he
heard of the case was in Novem-
Der, 1949. when he was called or
by Mr.. Ford, for the status OF
the case. Asked what prompted
that request, the witness said he
thought it was because Drew
Pearson or one of his representa-
tives had been asking United
States Attorney John Hill in Ala
bama about the case.
Case Returned to Justice.
The next day, Mr.. Mitchell con-
tinued, he heard the case had
been returned to Justice from In
ternal Revenue with a letter re-
viewing the evidence and stating
they thought the case could be
Mr.. Mitchell said one of the
nrst things he noticed in the let
ter was a reference to an audit
report, which suggested to him
that books must be available
somewhere. He said the letter also
indicated that the accountants for
the tobacco firm might be avail
able for questioning. Mr.. Mitchell
said he went to the Internal Reve-
nue. Bureau for further details
and found there had been a typo
error in the letter send
ing the case back.
However. the witness said he
sent a memo to Mr.. Caudle in
December. 1949, recommending
that he, Mr.. Mitchell, 60 to the
regional office in Atlanta and con-
fer with other Government inves-
tigators on reopening of the case.
He went to Atlanta and said he
told the other investigators the
department was going to institute
a grand jury investigation and try
to make the case.
Mr.. Mitchell said that when he
returned to Washington and told
Mr.. Smith what he had decided,
he quoted Mr.. Smith as saying
"Caudle would not like such q
recommendation"
Saw Significance in Talk.
Mr.. Mitchell said Mr.. Smith
said he had the impression that
Mr.. Caudle did not want the case
and was pleased when
Mr.. Hill had decided not to prose-
cute.
Mr.. Mitchell said he told Mr..
Smith that the final decision was
up to either Mr.. Smith or Mr..
Caudle, but that as long as he was
assigned to the case he intended
to make such recommendations as
he deemed proper.
Mr.. Mitchell testified he regard
ed this conversation with Mr..
Smith as 80 significant" that
when he returned to his own Office
he dictated the substance of it to
his stenographer.
Mr.. Mitchell described as every
unusual, coming from my super
iors" some of the conversations he
had with Mr.. Smith and others
in the tax division about the case
Questioned by DeWind.
He made the, statement when
Adrian w. DeWind, the subcom-
mittee counsel, was questioning
him about one of two converse
tions he held with Mr.. Smith
about the case in 1949 before the
indictments returned.
Mr.. Mitchell disclosed that he
had made a memorandum of the
conversations. one in which Mr.
Smith said it would be Mr.
Mitchell's responsibility If any
thing went wrong.
After getting the indictment
Mr.. Mitchell said. he came back
to Washington and added that he
never had any more work" in
Mr.. Caudle's division. He said he
sat around for several weeks and