Evening star., 1955-07-20
ProbersCheck
Adams Role
In Dixon-Yates
BY JOSEPH A. FOX

sought more light on the role OF
the White House in the trouble
stirring power deal.
Called back for questioning at
an afternoon session was Chair
man j. Sinclair Armstrong OF
the Securities Exchange Com
mission, who already has said
that the commission briefly sus-
pended hearing on the financ-
ing Of the Dixon-Yates combine
in June. in response to a call
from Sherman Adams, presi-
Dental assistant.
Mr.. Adams, it was explained,
sought the delay to permit the
possible intervention Of Govern
ment representatives who were
then out Of the city.
Would Block Testimony
Dixon-Yates foes spearheaded
by the subcommittee chairman,
Senator Kefauver, Democrat of
Tennessee, have been trying to
show that the move actually was
designed to head off-at least
temporarily - testimony tha t
might have had an adverse af-
feet on pending legislation to
provide funds for transmission
lines to hook the projected
Dixon-Yates power plant at West
Memphis, Ark, to the Tennessee
Valley Authority system, serving
nearby Memphis. Tenn.
Mr.. Armstrong. last week re-
fused to say if the appropria-
ton had been discussed with Mr..
Adams, until he conferred with
Attorney General Brownell, to
determine If such a converse
ton could be made public under
restrictions laid down by Presi-
dent Eisenhower covering conf
Dental matters.
Mr.. Armstrong refused to
answer other questions last week
before getting a green light
from the Attorney General, and
the administration attitude on
the poin now raised stirred spec
ulation in advance of today's
hearing.
Urged to Talk Freely
The subcommitte late yester.
day also invited Mr.. Adams to
testify fully" on the matter but
there was no indication of the
White House attitude.
The long drawn-out hearing
Of the subcommittee is being
pushed despite the fact that
President Eisenhower has Or
dered cancellation of the con-
tract under which Dixon Yates
Mississippi Valley Generating
Co.. under a contract with the
Atomic Energy Commission, was
to furnish power to the IVA as
replacement for iva power
going to atomic installations.
The decision of the city of
Memphis to build its own power
plant and have nothing to do
with Dixon Yates power was re-
sponsible for the Presidents
move.
At a hearing yesterday marked
by sharp criticism of Budget
Director Rowland Hughes and
Atomic Energy Commission
Chairman Lewis Strauss, the
subcommittee completed, at
least temporarily. one phase of
its inquiry-that dealing with
the role Of First Boston Corp,
which eventually became under
writer's for Dixon-Yates.
Says Code Was Violated
Winding up an extended
examination of Adolphe H.
Wenzell. a former vice presi-
dent of the New York banking
house. Senator Kefauver insist
ed that Mr.. Wenzell had violat-
ed the United States criminal
code by serving in the dual
capacity of power adviser to
the Budget Bureau when he was
still on the First Boston payroll.
Senator O'Mahoney, Demo-
crat, of Wyoming disputed this
contention.
Mr.. Wenzell told of becoming
fearful" that this dual role
might result in an "embarrass-
ing" situation and Of being ad-
vised 'by attorneys for First Bos-
ton that he should resign from
the Government job.
Senator Kefauver declared tes-
timony given the subcommittee
showed Mr.. Wenzell violated a
law forbidding a Government
employe to negotiate with the
Government for a private en-
ployer.
You don't think you could
avoid liability under this statute
by getting out just before the
transaction was completed, do
you?" he asked.
Yes, sir, / do" Mr.. Wenzell
replied.
No Business Transacted
Arthur Dean of the New York
Law firm of Sullivan & Crom-
well. counsel for First Boston
and representing Mr.. Wenzell,
argued that the statute could
not apply to Mr.. Wenzell. He
contended that First Boston
transacted no business with the
Government, and that the law
does not apply to an unpaid con-
sultant retained on an intermit-
tend basis.
IF Mr.. Wenzell had been
employed by Dixon-Yates." Mr.
Dean continued, "it would have
been q different situation"
Senator O'Mahoney also said
that the statute would not per-
NIT an indictment. He took Oh
on another tack, however. criti-
cizing the Budget Director and
Acc Chairman for their part in
the Dixon-Yates deal.
without any doubt" he said
"Hughes and Strauss were de-