Evening star., 1951-06-18
RFC Head SAYS
Aide Was Paid
By Borrower
Freeze Signed Papers
As Texmuss Official,
Symington Reports
By Robert K. Welsh

The Reconstruction Finance
Corp. disclosed today that Allen E.
Freeze, who resigned as assistant
controller last September, appar-
emily accepted a salary from an
RFC borrower while he was en-
Iployed at the agency.
Administrator w. Stuart Sy-
mington said he is turning the
matter over to the Justice Depart
ment. The situation came to light
as result of an investigation by
the agency itself and seems to in
volve "a clear violation of Fed
eral law" Mr.. Symington said.
Mr.. Freeze, according to Mr..
Symington, signed documents per-
tanning to SIS million loan to
the Texmass Petroleum Corp.
during period from April 18 to
June Is, 1850. He signed him.
self as vice president of that
company. He resigned from RFC
the following September %, stat
ing that he was taking an off,
cial position with TexmasS, Mr..
Symington reported.
Still Owes S13,76S,972.
The RFC administrator ex-
|plained that Mr.. Freeze appar-
emily had no direct connection
with the agency's original loan
to Texmass. The company still
owes $13.768,972 and its officials
are scheduled to confer with RFC
authorities here later this week
on the prospect of further re-
payments.
Mr.. Symington said the RFC
investigations Office got it's first
indication that Mr.. Freeze was
employed previously by Texmass
when a complaint was recently
made to that Office. Investigators
then obtained 20 documents, on
each of which, signed by COM
pany officials. Mr.. Freeze had
signed as a vice president, MI.
Symington said.
The administrator said this was
not conclusive proofs that Mr..
Freeze accepted a salary from
Texmass during the almost six
months before he resigned from
RFC. Mr.. Symington added:
"But information developed by
the investigations Office indicates
that this former official of RFC
accepted a salary from a borrower
while he was employed at RFC
and carried on business with and
for the borrower while he was
with RFC."
Plans to Bring Suit.
Besides turning the matter over
to the Justice Department, Mr..
Symington said RFC also plans to
bring suit to recover any RFC SAL
ary paid to Mr.. Freeze during the
time he apparently worked for
Iexmass and the agency. He also
revealed that Mr., Freeze during
the five-month period prior to his
resignation from RFC made more
than SO official long distance calls
to company officials or others in
connection with the Texmass loan.
Mr.. Freeze charged all those
calls to RFC, Mr., Symington
added.
Mr.. Freeze was an RFC en-
ploye from December, 1943, to
last September. He is So years old
and a former resident of Arkan-
sas.
Inquiry Continues.
His salary at the time of his
resignation was $1O,750. RFC
records indicate that his salary
when he officially went with Tex
mass last fall was $22 500. Since
then, however, the salary has been
raised to $4,000, RFC officials
said.
The investigation, Mr.. Syming-
ton declared, will not stop with
Mr.. Freeze. He said that if any
Texmass officials "are found to
have been a party to this ar
rangement we will take action
against them also"
Mr.. Symington commented that
the case was another example Of
problems that have arisen SO
frequently in the past when
agency officials resigned and i'm
mediately took high-paying jobs
with companies that had obtained
RFC loans. He noted that RFC
now has a regulation prohibiting
such practices, but he declared
that the ban should be written
into law.