Mr. RAINEY. Until he receives his final payment. Mr. TOLAND. When he does, you expect him to pay the $1,500? Mr. RAINEY. Yes, sir; he has been billed for the $1,500. Mr. TOLAND. You billed him for it? Mr. RAINEY. Yes, sir. Mr. TOLAND. You were also a supplier of Mr. Rohleder, weren't you? Mr. RAINEY. We were a subcontractor of Mr. Rohleder. Mr. TOLAND. Didn't you have three different positions with Mr. Rohleder? Mr. RAINEY. No, sir. Mr. TOLAND. Weren't you an employee of Rohleder's? Mr. RAINEY. I repeat, I found that out today. Mr. TOLAND. Secondly, weren't you a subcontractor to Mr. Rohleder? Mr. RAINEY. Yes, sir. Mr. TOLAND. And third, independent of your contract that you had with Rohleder, weren't you a supplier-your company? Didn't you supply material to Rohleder? Mr. RAINEY. I purchased materials for Rohleder. Mr. TOLAND. Through your own company? Mr. RAINEY. No, sir. Mr. TOLAND. How much time did you put on the job? Mr. RAINEY. About 95 percent of my time. Mr. TOLAND. At Cramp? Mr. RAINEY. Yes, sir. Mr. TOLAND. Where? Do you know? Mr. RAINEY. In the office or out through the job. Mr. TOLAND. When did you put 95 percent of your time, for what period of time? Mr. RAINEY. From the time that the 627 contract started. That was the contract that the arrangement was made on. The dates I don't recall. Mr. TOLAND. Was that 95 percent of the time spent on your own subcontract with Rohleder, or was any part of that time spent there as an employee of Rohleder? Mr. RAINEY. I don't get what you mean. Mr. TOLAND. Were you there on behalf of yourself as a subcontractor to Rohleder? Mr. RAINEY. Part of my time; yes. Mr. TOLAND. How much of that time did you spend as subcontractor to Rohleder? Mr. RAINEY. I would say 5 percent of my time was on my own contract. Mr. TOLAND. How much time did you spend there as an employee of Rohleder? Mr. RAINEY. Ninety percent. Mr. TOLAND. Ninety percent? Mr. RAINEY. Yes, sir. Mr. TOLAND. And you never knew until today you were his employee? Mr. RAINEY. It was a misunderstanding. I was to receive $5,000. Mr. TOLAND. For what? Mr. RAINEY. For supervision of that contract of Mr. Rohleder's. Mr. RAINEY. His contract. He was the general contractor, which included the electrical work. Mr. TOLAND. What did you supervise other than the electrical work? Mr. TOLAND. The only electrical contract was your contract, is that right? Mr. RAINEY. The subcontract, you mean? Mr. TOLAND. Yes. Mr. RAINEY. Yes, sir. Mr. TOLAND. So that you were supervising your own subcontract, weren't you? Mr. RAINEY. That is right. Mr. TOLAND. What was the $5,000 for? Mr. RAINEY. For supervising $300,000 in his contract. Mr. TOLAND. That was your contract with him? Mr. RAINEY. It wasn't my contract. Mr. TOLAND. You had subcontracted for that work. Mr. RAINEY. Not that one; no, sir. Mr. TOLAND. What subcontract did you have? Mr. RAINEY. For the four-story office building, the nine-story office building, the moldloft, buildings, 3, 17, 7, 18, 25, 28, 33. Mr. TOLAND. What was the amount of your subcontract? Mr. RAINEY. Approximately $130,000. Mr. TOLAND. What was your profit on that contract? Mr. RAINEY. Offhand, I can't tell you that because the books are not closed out yet. Mr. TOLAND. It is finished, isn't it? Mr. RAINEY. We are still working there. Mr. TOLAND. Still working? Mr. RAINEY. Yes, sir. Mr.TOLAND. How much more do you have to do? Mr. RAINEY. We just received within the last month thirty-some thousand dollars direct from Cramp's. Mr. TOLAND. But I am asking about this contract, the subcontract. Is that completed? Mr. RAINEY. The Rohleder stuff is completed; yes, sir. Mr. TOLAND. That is what I am asking you about. How much do you estimate your profit on that subcontract? Mr. RAINEY. I would say we made about 12 percent net. Mr. TOLAND. On how much? Mr. dollars of subcon tracts. Mr. TOLAND. And in addition to that, you get $5,000 for supervising. Mr. quarters and one million dollars. Mr. TOLAND. Who are the other electrical contractors? That is the job the Turner Construction had. Mr. RAINEY. The ways were the Electric Power & Equipment Co. Mr. TOLAND. You didn't have the subcontract for that job? Mr. TOLAND. How much time did you spend on the Turner job? Mr. TOLAND. What are the other electrical subcontractors at Cramp? Mr. RAINEY. I don't know who the other subcontractors are. Keystone Engineering Co. just received a contract. Mr. TOLAND. I am trying to find out for the benefit of the committee, just where you spent 90 percent of your time, and on what contracts? Mr. RAINEY. On my own contracts and Rohleder's contracts. Mr. TOLAND. All right. How much did you spend on your own? Mr. RAINEY. Five percent of my time on my own contract. Mr. TOLAND. All right, tell us the subcontractors that you spent 90 percent of your time on. Mr. RAINEY. On Rohleder's contract. Mr. COLE. With whom? Mr. TOLAND. With whom? Mr. RAINEY. What do you mean, "with whom"? Mr. TOLAND. What contract of Rohleder's did you spend any time on except the electrical contracts? Mr. RAINEY. None except the electrical. The ACTING CHAIRMAN. How many electrical subcontractors were there besides yourself? Mr. RAINEY. There was only one besides myself. The ACTING CHAIRMAN. Who was that? Mr. RAINEY. Myself. Mr. TOLAND. Who was the other besides yourself? Mr. RAINEY. Rohleder. Mr. TOLAND. No, no, no. How many electrical subcontractors were there? Mr. RAINEY. For Rohleder? Mr. TOLAND. Yes. Mr. RAINEY. None except myself. Mr. TOLAND. You were the only one? Mr. RAINEY. That is right. Mr. TOLAND. And you had that contract, is that right? Mr. RAINEY. That is right. Mr. TOLAND. You spent 5 percent of your time on that? Mr. RAINEY. That is right. Mr. TOLAND. You said you spent 90 percent of your time on other contracts of Rohleder's? Mr. RAINEY. The electrical work that was included in Rohleder's contract. Mr. TOLAND. Did you do some electrical work which he did not give to a subcontractor? Did he do some himself? Is that what you mean? Mr. RAINEY. Yes, sir; and I was supervising that. Mr. TOLAND. How much of that did he do? Mr. RAINEY. The difference between one-hundred-twenty-some thousand and the cost of the electric work, which is close to $700,000. Mr. TOLAND. Rohleder did that himself? Mr. RAINEY. Yes, sir. Mr. TOLAND. And you supervised it? Mr. RAINEY. Yes, sir. Mr. TOLAND. How much time would you say you put in each week and each month, yourself? Mr. RAINEY. Ninety percent of my time on that stuff and 5 per cent on my own. Mr. TOLAND. Would you be there every day? Mr. RAINEY. Yes, sir. Mr. TOLAND. All day long? Mr. RAINEY. Not all day; no, sir. Mr. TOLAND. How many days of the week were you there? Mr. RAINEY. Except time when I was on a couple of other contracts, I was there 6 days a week, sometimes 7 days a week. Mr. TOLAND. How often was that? Mr. RAINEY. The 7 days a week? Quite considerably. I haven't any record of it. Mr. TOLAND. Isn't it a fact that you prepared or obtained complimentary bids for Rohleder? Mr. RAINEY. On what? Mr. TOLAND. Any kind of bids. Mr. RAINEY. No, sir. Mr. TOLAND. You never did? Mr. RAINEY. No, sir. Mr. TOLAND. Were any phony bids ever typed in your office? Mr. RAINEY. No, sir. There were bids changed at the instructions of salesmen of various materials. Mr. TOLAND. Tell me the ones that were changed, if you can recall. Mr. RAINEY. There was one instance of the Anaconda Wire & Cable Co., changed its delivery date. Mr. TOLAND. Just the delivery date? Mr. RAINEY. Yes, sir. Mr. TOLAND. What other change in any other contract or bid in your office? Mr. RAINEY. The stenographer in the office there, and several times salesmen there, I knew she typed bids for them, because they asked for price and material at once, and they were made at once. Mr. TOLAND. Do you remember what they were, what companies? Mr. RAINEY. I do not. Mr. MAAS. Did you ever ask supply houses to furnish complimentary bids? Mr. RAINEY. On several occasions; yes, sir. Shall I explain? Mr. RAINEY. In one instance, the Bradley Co. were agents for G. & W. material. The ACTING CHAIRMAN. What name is that? Mr. RAINEY. The Bradley Co. The ACTING CHAIRMAN. No connection with the chairman. It is the first time I have heard the name. Mr. RAINEY. And Switzer & Conrad, and Byrne Doors Manufacturing Co. They sell through jobbers only. He was called at times. to send a quotation to any jobber he would select, it didn't make any difference to us, because that was material specified, to buy that material for Cramp Shipbuilding. In order to expedite the work, he was bound to get the order anyway, from some jobber, we asked him to phone the factory to get that material ordered, pending receipt of an order from the jobber that received the order. Mr. MAAS. Is that the only instance? Mr. RAINEY. That happened on several occasions of the same sortWalker Bros., for instance. Even though there was a contract made with Walker Bros. for his conduit, the Oconite Co. it happened with Mr. MASS (interposing). And you would explain to them that they had to comply with naval regulations and submit several bids? Mr. RAINEY. We knew nothing about the naval regulations. We were dealing with Cramp Shipbuilding Co. through Rohleder. Mr. MASS. Did Rohleder tell you it was necessary to get additional bids on each of these job orders? Mr. RAINEY. At times, yes. Mr. MAAS. Did anybody ever explain to you why? Mr. RAINEY. No, sir. Mr. MAAS. You never thought to ask why? All we had in mind was to get the job done. Mr. MAAS. That isn't all you had in mind, apparently. It never occurred to you that there might be any irregularity in getting bids after the work had already been let or the material delivered to the job? Mr. RAINEY. A lot of the material was there, Mr. Maas, yes, sir. A lot of the material was there before we ever tried to get bids. Mr. MAAS. It never occurred to you that there was any irregularity in working up bids to make the appearance it had been competitive after the stuff had been delivered? Mr. RAINEY. No, sir; we had permission to purchase material without approval up to $200 on one contract and $100 on another contract. Mr. MAAS. Where you had that permission you didn't have to have bids? Mr. RAINEY. We did have to have bids. They came back later and wanted bids on anything. The material had been installed for some time. Mr. MASS. Then what happened to the permission you had? Was that withdrawn? Mr. RAINEY. It stopped then. Mr. MAAS. But it was a general practice, was it, for you as a subcontractor for Mr. Rohleder to order materials and then subsequently get complementary bids to justify the original order? Was that a general practice? Mr. RAINEY. No, sir. Mr. MAAS. How much of the supply and subcontracting that you arranged was done on that basis? Mr. RAINEY. I would say about $4,700, a little less than $5,000. Mr. MAAS. And the rest was all on genuine bona fide competitive bids? Mr. RAINEY. Yes, sir; Westinghouse Electric & Manufacturing Co. furnished $100,000 of that material themselves. Mr. COLE. Whom did you think you were working for when you were there supervising that job? Mr. RAINEY. Rohleder. I took all my orders from Rohleder. Mr. COLE. But you said you didn't learn until today that you were working for Rohleder. |