Mr. HARTSON. You asked for the returns of the Gulf Oil Corporation for subsequent years, 1920, 1921, and 1922. Those are here if the Senator wishes them now. Senator COUZENS. Were they accepted in the original form, or were they amended? Mr. HARTSON. I think they are now in process of auditing. I do not know that there have been any amended returns for them. Senator COUZENS. You might show us what you have here. Mr. HARTSON. Yes; they are the returns for 1920, 1921, and 1922. The 1923 return, of course, is not available as yet. Senator COUZENS. I would like to ask Mr. Hartson a question or two. STATEMENT OF MR. N. T. HARTSON, SOLICITOR INTERNAL REVENUE BUREAU-Resumed Senator COUZENS. In this letter, Mr. Hartson, that you presented to the committee, from the Secretary of the Treasury, dated March 25, the Secretary wrote, as I understand the letter, to the effect that it was from newspaper stories and not from anything that was requested by this committee. Is that your understanding of it? Mr. HARTSON. I was not present at the time that that was prepared, and never heard of the letter, nor knew of its contents, until it was read here to the committee, Senator Couzens. You will recollect that the day before that letter was produced, I told the committee that I thought the Secretary would have no objection åt all to presenting the records in the Gulf Oil case, and upon returning to the Treasury I so informed the Secretary that I had told the committee to that effect. The next day that letter came out. Now, I do not know what the letter does say in regard to newspaper reports. Senator COUZENS. I will just read it to you. The CHAIRMAN. Was that letter addressed to you, Senator? Senator COUZENS. No; it was addressed to you. It was turned in here at the hearing. The CHAIRMAN. Yes; that is right. I remember it now. Was it incorporated in the record? Senator COUZENS. Yes. In the hearing before your committee yesterday what purported to be a copy of a memorandum delivered by an ex-employee to a member of your committee was introduced and has been made the basis for headlines in the newspapers which might lead the public to believe I had sought to influence the Bureau of Internal Revenue in its consideration of the tax liability of certain companies in which I am interested as a stockholder. As I have already stated, I have never interfered in any way with the Bureau of Internal Revenue in any tax matter, least of all would I do so in cases in which it might be charged that I was personally concerned. I feel, however, that it is due to me and to the companies involved that your committee make an immediate investigation in order that you may throughly satisfy yourself and the public whether or not these companies have received any favors from the Government. You will see that he refers to the companies in which he is a stockholder. Then the letter goes on and says: Three companies which have been mentioned are the Gulf Refining Co. and its subsidiaries, the Standard Steel Car Co., and the Aluminum Co. of America. Each of these companies has advised the Commissioner of Internal Revenue that it waives its right to privacy under the statute. At that point, I would like to ask you if you have any copy of the waiver of that notice? Mr. HARTSON. I have none. I am informed by Mr. Greenidge that these companies have submitted proper waivers, executed by their duly empowered officers. I did not know that personally. Senator COUZENS. Do you know of any other companies in which the Secretary is interested besides those three? Mr. HARTSON. I do not know the Secretary's companies. Senator COUZENS. In view of the suggestion of the Secretary that the companies that he is interested in be investigated, would you mind asking the Secretary to submit a list of all the corporations and companies that he is interested in? Mr. HARTSON. I will be very glad to. Senator COUZENS. I think that will probably be more convenient than to subpoena the Secretary to produce his records. Mr. HARTSON. Yes, sir; I shall be glad to do that. Senator COUZENS. I would like to have you bring down here a list of the companies, including the one that is in trust in the Union Trust Co. of Pittsburgh, namely, the Overholt Distillery Co. Senator ERNST. Mr. Senator, in view of your remarks a little while ago, what will the summoning of those companies have to do with getting at any constructive methods to better conduct this bureau? Why take his companies rather than some other companies? Senator COUZENS. The Secretary suggested it. Senator ERNST. I know, but you seem eager to have those companies. Why not suggest some others? Senator COUZENS. I will be delighted to do so, if they will waive their statutory rights. Mr. NASH. Mr. Chairman, I have some replies from companies whose names have been mentioned by some of the witnesses, who have indicated that they will waive their rights also. Senator COUZENS. Will you enumerate those companies to the committee, please. Senator ERNST. The point I am trying to get at is this: Can you find out how these results are arrived at from figures, without naming the companies, in order that we may find out just what you are endeavoring to ascertain? Why is it necessary to go into the particulars of each of these companies when these gentlemen have all of the books and figures, and can tell you just the manner in which they arrived at their results? Why should we hunt up some particular company, rather than take these facts that these gentlemen. can give us and then form our opinions from them? Senator COUZENS. But we will have no concrete case. Senator ERNST. They have given you all of the concrete cases you want, without the names of the companies. Senator COUZENS. Well, we will have no opportunity of checking the figures to see how it is done, if you do not have concrete cases. We will only have hypothetical cases then. Senator ERNST. No; they can give you the cases based on the actual facts and tell you exactly how they arrived at the facts, without giving the name of the company Senator COUZENS. I have no objection to that. I am investigating the companies which the Secretary requested us to investigate. Senator ERNST. I think that would make it all right. It would not look as if we were after Mr. Mellon and his companies. Then our work would look as if it was really constructive, but now it looks as if we were after the Secretary of the Treasury. Mr. HARTSON. Mr. Nash, have you those letters? Mr. HARTSON. These, Senator, are photostatic copies of letters that have been received by the commissioner. Senator COUZENS. Will you read them into the record, please? Mr. HARTSON. The first one is from the Berwind-White Coal Mining Co., Philadelphia, Pa., and is addressed to Hon. D. H. Blair, Commissioner of Internal Revenue, Treasury Department, Washington, D. C., dated March 26, 1924: MY DEAR SIR: Answering your courteous inquiry of March 24, we not only have no objection to your disclosing to the investigating committee of the Senate any information which it may require in connection with the matter to which you have referred, but we shall be pleased to have you submit also to the committee any other data affecting our relations with your bureau which may seem to you pertinent to pending issues. The adjustment of which criticism has been offered was accomplished by the writer after negotiations extending over a period of practically two years, during which he rarely came twice in contact with the same representative of the department. You may rest assured-if assurance be required-that the results so accomplished were consistent with the laws of Congress and with the regulations promulgated by the department in pursuance thereof, and were favorable to the Government rather than to ourselves, as the concessions which we were thereby obliged to make were preferable only to the protracted litigation which would have been required to secure to us the full measure of relief to which we felt we were entitled. We have no desire to augment the volume of testimony now being adduced before the committee; but we are duly mindful of the high principles governing your administration of the bureau, and if you should so desire we shall be pleased to acquaint the committee with the details of the instant case, and to attest to the unimpeachable character of the officials by whom our amortization claim was finally adjusted. With great respect, we are, very sincerely yours, THE BERWIND-WHITE COAL MINING Co., The committee will recollect that that company was a company referred to by a former employee of the bureau in his testimony, to the effect that the amortization claim in this case was unduly favorable to the company. I think this discharged employee had turned in a report which had not been 100 per cent concurred in by the bureau officials, and he testified that the settlement of this case ought to be the subject of inquiry. This is a waiver of that company of their right of privacy of their returns. The next letter is from Lee S. Smith & Son Manufacturing Co., dental products, Pittsburgh, U. S. A., dated March 26, 1924, and addressed to Mr. D. H. Blair, Commissioner of Internal Revenue, Washington, D. C.: DEAR SIR: Referring to your letter of March 24, we grant you our permission to submit any and all papers and data pertaining to our case, should a request be made on you by the investigating committee to do so, as we have absolutely nothing to withhold from the proper authorities. Respectfully yours, LEE S. SMITH & SON MANUFACTURING Co., That is another case similar to the case just referred to, where a former employee of the bureau testified that an amortization claim had been allowed in excess of what properly should have been allowed under the law. Senator COUZENS. Did the department write to any other concerns whose names were mentioned in the testimony, outside of those two? Mr. HARTSON. I believe the department wrote to all of those companies that were referred to here in the testimony by those who disagreed with the adjustment made by the department. Senator CoUZENS. And those are the only replies you received? Mr. HARTSON. So far as I know, these are the only two. Mr. NASH. Those are the only two that have been received and sent over to my office, Senator. Senator COUZENS. In other words, there was some bag company, the Standard Oil Co., and a number of others mentioned in the testimony, from which you requested the same waiver? Mr. HARTSON. We sent out a form letter to all of the companies whose names have been mentioned in the course of the inquiry. Senator COUZENS. I think that is a very excellent idea. The CHAIRMAN. How many of them were there? Mr. HARTSON. There must have been a dozen or some such number as that. I have no definite recollection of it. Senator COUZENS. Will you furnish the committee a list of those to whom you wrote letters? Mr. HARTSON. I shall be very glad to. Mr. GREENIDGE. I think you meant the Standard Steel Car Co. when you said Standard Oil Co., did you not? Mr. HARTSON. The Standard Oil Co. was referred to by Mr. Ross moore. Mr. GREENIDGE. The Standard Steel Car Co. has already waived. its right. Senator CoUZENS. Pursuant to Mr. Mellon's letter, I think we ought to have the records of the two companies that he refers to, the Aluminum Co. of America and the Standard Steel Car Co. He specifically referred to those two. Mr. HARTSON. They are here. We have been bringing them up here every day. Mr. GREENIDGE. Those particular ones are not here, but they can be brought here. Mr. HARTSON. They are subject to the committee's wishes. They can be brought. Mr. NASH. Senator Couzens, may I say that the files in those cases are quite voluminous, and it is quite a task to bring them down and haul them back. If we could get a little advance information as to when these cases are wanted, we could bring them down at that time. The CHAIRMAN. What advantage is there in the bringing of all of these books here? Senator COUZENS. I do not think there is any advantage in it. Senator COUZENS. I would like to suggest, in view of the fact that the officials of the bureau have submitted the original returns and the amended returns of the Gulf Oil Corporation, if they were to bring the original returns and the amended returns, with a statement |