Evening star., 1952-03-09
Casey Group Isn't Forgotten
AS Ship Probe Widens Course
by Robert K. WoIsh

IAS CnIp pFTOOe Y
By Robert K. Walsh
Figures who charted first moves
in profitable surplus ship deals
Iare temporarily far in the wake
Iof q widened course which Sena-
tors plan to follow in questioning
Newbold Morris this week.
Senate Investigations subcom-
mittee members concede that Con-
|gress and the general public may
have difficulty keeping their bear
ings on who did What-and how
and when it was done--in such
complicated transactions. But
they say they have not lost sight
Of the Casey group" in the cur
rent inquiry.
The scheduled Tuesday exami-
nation Of Mr.. Morris has given an
ironic and spectacular turn to the
sabcommittee's investigation of
ship deals engineered originally by
former Representative Joseph E.
Casey and. several prominent as
sociates more than four years ago.
Mr.. Morris since February / has
been in charge Of the investiga-
ton Of corruption in Government.
Even before he was formally in
vited to testify, the subcommit-
tee hearings branched out last
week into such matters as oil
shipments to Red China. 1t pro-
duced evidence that some Ameri-
can tankers, chartered to Soviet
agencies. carried oil to China in
l949 and 1850 until shortly before
the Korean fighting.
Linked to Morris Firm.
: At least one of those tankers
came from the batch of eight
which the Casey group got in 1947
from the old Maritime Commis-
sion. the subcommittee learned.
That tanker was one of three
which the Casey group sold to a
company linked, in testimony,
with the New York law firm of Mr..
Morris and with a philanthropic
Organization he heads.
Despite the confusion involved
in tracing Q bewildering series
|of corporate setups, stock trans
actions and recent offshoots, sub
committee members declare their
main goals still are to determine: /:
Whether there was tax evasion
|or unjustiflable tax avoidance by
any Of the persons or companies
in the intricate transactions;
whether there was influence
|peddling or collision to get prefer
'ential treatment from the Mari
time Commission or the Internal
Revenue Bureau; whether the
practice of operating surplus ships
under foreign registry violated
United States regulations and
harmed the national interest, and
whether the Government has
grounds to seize any surplus tank
ers which apparently wound up
being used to help the Chinese
or other foreigners.
Big Profit Disclosed.
Almost a year ago Mr.. Casey,
now a Washington attorney, ap-
|peared before another Senate sub
committee investigating the Re-
construction Finance Corp. He
disclosed that he and several
prominent associates, including
the late Secretary of State Ed
ward r. Stettinius, jr., Admired
William F. Halsey, and Julius C.
Holmes. now minister and coun-
seller at the American embassy in
London, made big profits on a
small investment by buying
several surplus tankerS from the
Government.
The Investigations subcommit-
tee headed by Senator Heey,
Democrat, of North Carolina, in
herited the ship deal puzzle. Hear
ings which opened last month
have unfolded this general story:
Mr.. Casey and his associates
set up the American Overseas
Tanker Corp, as a Delaware in
August. 1947. and put in a total
of only 100000. They obtained
Ia $9.2 million loan from the
Metropolitan Life Insurance Co.
and bought five surplus tankers
from the old Maritime Commis-
sion. The tankers were the
Owyhee, Yamhill, Umatilla,
Gervais and Fort George.
Panama Firm Let Up.
The Casey group then estab-
lished the Greenwich Marine
Corp, with the same officers as
American Overseas but as a
| lPanamanian company. American
Overseas chartered the five tank
ers to Greenwich Marine which
}sub-chartered them to a Pana-
Imanian subsidiary Of the Stand
ard Oil Co. of New Jersey.
On their initial investment of
100000, the Casey group-later
expanded to included stockholders
such as the University Of Chicago
- netted total profits Of $2.s
million.
Later. Mr.. Casey and a few
others put $1,000 into a transac-
ton involving three additional
ltankers from the Maritime Com
mission. They netted $450.000 on
that deal when the stock and
tankers went into other hands
Thus. on q total venture Of $101,-
/ 600 MIR. Casey and his associates
made q total Of $3.50, 900 within
about two years.
i As for the i've tankers first &C.
lquired by the Casey group. Amer
IIican Overseas Tanker paid on tht
,Ilife insurance company loan by
.I.... - faA Aorniya et