Mr. BONNER. Put it in the record as request of Mr. Hoffman, the member of the subcommittee.

(The papers referred to marked "Exhibits 41 and 42," follows:)

EXHIBIT 41

BUNKER HILL SCHOOL OF AERONAUTICS-CHRONOLOGICAL RÉSUMÉ

July 5, 1946: The Navy was contacted for permission to inspect the base for school and aircraft maintenance purposes.

August 6, 1946: The city of Peru was contacted relative to leasing the base. September 25, 1946: Bunker Hill officials made a trip to Washington with Mr. Ladd to interview Navy re base.

October 16, 1946: Bunker Hill acquired temporary permit from the Navy. November 2, 1946: Bunker Hill signs temporary agreement with Ladd and Harrah.

December 17, 1946: Shepler signed WAA purchasing agreement. Bunker Hill signed lease with the Navy.

January 21, 1947:
January 29, 1947:

Hill Corp.

Bunker Hill Corp. formally incorporated.

Bunker Hill signed temporary agreement with the Bunker

February 4, 1947: Bunker Hill signed lease agreement with Bunker Hill Corp. March 17, 1947: Bunker Hill School of Aeronautics formally incorporated. April 30, 1947: Bunker Hill School of Aeronautics received approval of nonprofit status from revenue department.

May 1, 1947 (about): First tentative lease for building 7W and Number 49 was offered.

May 28, 1947: Bunker Hill School of Aeronautics received report on heating buildings from engineer employed to make survey.

June 7, 1947: Bunker Hill School of Aeronautics received stop purchase letter from Bunker Hill trustee.

June 19, 1947: Bunker Hill School of Aeronautics received letter from WAA authorizing transfer of property title from Bunker Hill School to Bunker Hill School of Aeronautics.

June 8, 1947: Conference between officers of school and corporation re another lease.

Step No. 1: Contact State board of vocational education, the Civil Aeronautics Authority, and various existing educational institutions in order to determine need for proposed type of education.

Step No. 2: Form the membership of the proposed organization.

Step No. 3: Incorporate under the State laws of the State of location as a not-for-profit corporation.

Step No. 4: Membership elects officers and directors.

Step No. 5: File with the Treasury Department copies of articles of incorporation, bylaws, etc., balance sheet, proposed method of operation, and an application tax-exemption certificate.

Step No. 6: File with War Assets Administration copies of articles of incorporation, Treasury Department exemption certificate, WAA Educational Material Agreement Form No. 65.

Step No. 7: Receive assignment of symbol number for purchasing of material. Mr. HOFFMAN. I have a few questions, if I might.

Is it not true that on this base were three classes of property? There was property that was purchased by and before the Bunker Hill School of Aeronautics, there was property that was purchased by the Bunker Hill School general surplus, not for educational purposes; and there was also surplus property and other property, there was the personal property of Harrah.

Mr. CURRAN. That I don't know. I know that there was property belonging to Harrah, and property belonging to the school andbut as to what was surplus and what was not, I don't know.

Mr. HOFFMAN. All right. When did this property begin to come in; late in 1946, was it not?

Mr. CURRAN. I don't believe any of the school property-I think the property that came in, at least it was my understanding the property that came in late in 1946 was the private property of either Mr. Pemberton or Mr. Harrah, or Mr. Harrah's company; I don't believe there was any school.

Mr. HOFFMAN. When did the school property first come in, if you recall?

Mr. CURRAN. Oh, I have forgotten. It seems to me though-I don't know-I believe it would be January, February, something like that.

Mr. HOFFMAN. January, February?

Mr. CURRAN. January or February, somewhere in there, I believe that is it; I am not sure of that, sir.

Mr. HOFFMAN. You testified, did you not that: "We paid the freight bills and truck bills. We got tired of this; there was no reason why we should pay the school's bills." You testified to that?

Mr. CURRAN. That is right, the Bunker Hill Corp. paid the bills. Now I don't know whether at that time they were paid by the corporation or whether Mr. Ladd paid them or what, I know the school didn't pay them, and later the school did pay them. I don't know who paid the first bills. I know it wasn't paid by the school.

Mr. HOFFMAN. Well, who did you mean when you said "we"?
Mr. CURRAN. Well, to begin with, I don't know.

Mr. HOFFMAN. During January and February you said "We paid the bills." Who did you mean?

Mr. CURRAN. It wasn't I in January or February.

Mr. HOFFMAN. Let's see if it wasn't. Wasn't it a fact Mr. Ladd left with you a bunch of blank checks signed by him and as the property came in you sent them out?

Mr. CURRAN. I don't believe so; no, sir.

Mr. HOFFMAN. You won't testify under oath you didn't?

Mr. CURRAN. I don't remember.

Mr. HOFFMAN. That is the best you can give me?

Mr. CURRAN. Yes, sir, I don't remember whether he gave me blank checks or not.

Mr. HOFFMAN. During January and February you were still on the base in uniform, weren't you?

Mr. CURRAN. Yes, sir; I was.

Mr. HOFFMAN. If you are mistaken about this while you were still acting as an officer you were paying these bills?

Mr. CURRAN. No, sir; I don't believe I was.

Mr. HOFFMAN. You were a member of the corporation, weren't you? Mr. CURRAN. No, sir. I didn't become a member of the corporation until May of 1947.

Mr. HOFFMAN. You say you didn't pay the bills?

Mr. CURRAN. Yes, sir; they might have gone over to Mr. Ladd and maybe he wrote personal checks. The first bills that were paid for the corporation Mr. Ladd paid out of his personal account for some

time because the corporation didn't have a bank account and wasn't set up and as I remember the first corporation bills as the Bunker Hill Corp. bills were paid by Mr. Ladd and then later the corporation reimbursed him.

Mr. HOFFMAN. January and February-oh, you were there on the base, Mr. Pemberton was there with you, sat right next to you?

Mr. CURRAN. Well, yes, he sat at the fire house with us.

Mr. HOFFMAN. Sure, he was right there on the base with you occupying the same room. I am trying to refresh your recollection. He was buying this property?

Mr. CURRAN. Is this January, February 1947?

Mr. HOFFMAN. Yes.

Mr. CURRAN. I don't believe I was living on the base January, February 1947. I believe I was living in Peru. I had an apartment in Peru at that time.

Mr. HOFFMAN. You sure of that?

Mr. CURRAN. I am quite sure.

Mr. HOFFMAN. May I ask Mr. Pemberton, he has been sworn before? Where were you in January and February 1947?

Mr. PEMBERTON. Buying surplus property and staying out at the base between trips.

Mr. HOFFMAN. Was Mr. Curran staying there then?

Mr. PEMBERTON. I don't believe he stayed all the time but he stayed many nights out there. In January and February.

Mr. CURRAN. The only nights I stayed, I was living in Peru. I believe my wife was gone 3 or 4 days of the month and when she was gone I stayed at the base.

Mr. HOFFMAN. You say the last 3 years you have been living at the base?

Mr. CURRAN. No, sir; I moved out to the base in about May of 1948, I believe it was, and left there last-early last fall.

Mr. HOFFMAN. You said this morning, if I remember correctly, that they had 100 new engines out there?

Mr. CURRAN. I said approximately, I believe.

Mr. HOFFMAN. How do you know those engines were new. Isn't it a fact they came in crates and no more than 35 of them were ever taken out of the crates?

Mr. CURRAN. That I don't know but I believe I was told by Mr. Harrah and Pemberton that those were practically all the engines they had gotten were new.

Mr. HOFFMAN. You don't know of your own knowledge how many of those engines were new, do you?

Mr. CURRAN. No, sir; I had no way to look at them.

Mr. HOFFMAN. I understood you made the direct statement they had a hundred new engines. I wondered whether you knew anything about it or whether you were relying on somebody else?

Mr. CURRAN. I was relying on what I was told. I don't believe I put a figure of a hundred

Mr. BONNER. Who did you say told you: Mr. Harrah and Mr. Pemberton?

Mr. CURRAN. Yes, sir.

Mr. BONNER. They owned them, didn't they?

Mr. HOFFMAN. They told you they were new?

Mr. CURRAN. They said the bulk were new.

Mr. HOFFMAN. When did they tell you that?
Mr. CURRAN. Somewhere along in 1947.

Mr. HOFFMAN. If the engines were not out of the crates how did they know whether they were new or old?

Mr. CURRAN. They were buying from War Assets. It would make a difference whether you bought an engine, I don't think anybody would buy an engine

Mr. HOFFMAN. Do you know what the engines were worth and what the Government was selling them for?

Mr. CURRAN. I understand they paid $10 apiece for them but I don't know what they were worth.

Mr. HOFFMAN. You said also something about two machine-shop trucks and trailers were received by the school?

Mr. CURRAN. I said that there was a couple, yes; they were

Mr. HOFFMAN. Now don't you know as a matter of fact this: They never bought any from surplus from the school and all they had was one machine-shop truck?

Mr. CURRAN. I don't know where they got it but it seems to me they had quite a lot of vans, there were three or four or five vans. It is my understanding a couple of them were portable machine shops.

Mr. HOFFMAN. You don't know of your own knowledge what they did buy if you get down to facts?

Mr. CURRAN. Not what was in those vans because I wasn't in all of them. I know what I was told by them, that is the basis I am going on and most of my testimony is what I was told by the representatives of the school and I felt if they were telling me that, and told me that, they should know.

Mr. HOFFMAN. Why should they discuss that with you?

Mr. CURRAN. They were trying to get Mr. Ladd and I to put money in the school and become associated with them.

Mr. HOFFMAN. And you didn't want it?

Mr. CURRAN. No, sir.

Mr. HOFFMAN. You fellows wanted to use it for something else! Mr. CURRAN. Not necessarily but we wanted to be careful what we got in there.

Mr. HOFFMAN. What did you want to use the place for?

Mr. CURRAN. We wanted to use it to operate a base activity and an airport and a recreational center and operate it as a business proposition so that it would be for the benefit of the general community and still be able to make a return that

Mr. HOFFMAN. Make some money for yourself?

Mr. CURRAN. Well, naturally; nobody is interested in working for nothing.

Mr. HOFFMAN. Sure, isn't this the situation, that Ladd and Pemberton and those that were associated with them, not Ladd, I will start over again; that Harrah and Pemberton and those associated with them later, but primarily Harrah and Pemberton had the idea of starting a school, and if they started a school they would get this property at a certain discount from the Government, also dealing in surplus property which anyone could buy and which came at another discount and making some money for themselves out of that place; isn't that the thought you got and isn't that what they told you, if you went into it with them you would make some money!

Mr. CURRAN. What they told us if we went in with them we would put $5,000 apiece in it.

Mr. HOFFMAN. How many of you-four or five?

Mr. CURRAN. Two of us, with whatever was in there, I think, they had four or five; we would put $5,000 and apiece and we would be appointed trustees of the school and as trustees of the school we would be entitled to a salary and where the money was going to be made they were going to form a separate corporation; it was going to be an aviation repair and overhaul for repairing large airplanes under contract from airlines and private carriers and what not, and that corporation would receive its equipment from, the school under a lease at a very low figure and there that corporation would make all the money they wanted and there would be a big profit from the organization and that is where you would profit.

Mr. HOFFMAN. That is to say they were going to operate an aeronautical school; the airport they were going to have a big repair base there and also deal in surplus property which they would buy from the Surplus Administration. Is that right and they held out to you the thought that there would be a big profit in that?

Mr. CURRAN. Big profit in the separate company that was formed. Mr. HOFFMAN. Well sure

Mr. CURRAN. The profit was going to be made because the company would have received their equipment from equipment that the school had received to run a school and we didn't like the looks of that.

Mr. HOFFMAN. Not wholly. You know as a matter of fact that anyone when they bought property for the school they got it at a certain discount; it was 90 percent?

Mr. BURNSIDE. Ninety-five.

Mr. HOFFMAN. Ninety-five percent, then when they bought property from surplus some of that they got 40 percent; isn't that right? Mr. CURRAN. I know about the 95; I am not sure about the property. I know there were discounts, but they weren't as much naturally an educational or nonprofit institution could buy at 95 percent; and an individual could not.

Mr. HOFFMAN. Then you and Ladd conceived the idea that you could get the lease, you could rent some of the property there for storage and operate it and make some money?

Mr. CURRAN. No, sir.

Mr. HOFFMAN. What is wrong with that statement now; where am I wrong?

Mr. CURRAN. What do you mean Ladd and I? The original intention was the Bunker Hill Corp. Now I mean you thought that Ladd and I could get it away, could not have the school and then run it ourselves, that what you are getting it?

Mr. HOFFMAN. Go back now, the Bunker Hill Corp., there were five of you in it, wasn't there in the first place?

Mr. CURRAN. There was three.

Mr. HOFFMAN. Then you and Ladd went in?

Mr. CURRAN. Well, no; in the Bunker Hill Corp? No, there was three-Miss Mullaney, Mr. Harrah, and Mr. Ladd; that was the three members then when I bought Miss Mullaney out; that still left three there.

Mr. HOFFMAN. You took in some more afterwards?