Mr. TOLAND. What angle is that? Mr. MASTERSON. That is, I went and got the checks cashed and gave the money to the commander.

Mr. TOLAND. This is endorsed by someone else under your signature. Mr. MASTERSON. That is right; that is where I worked. I got it cashed by one of the men I worked for.

Mr. TOLAND. You gave check No. 19, $50, back to the commander? Mr. COLE. Do I understand some of these checks were endorsed by the commander?

Mr. TOLAND. Yes, one.

The next is check No. 18. What is that for?

Mr. MASTERSON. That is $10. That is for myself.

Mr. TOLAND. You received the amount represented by this check yourself?

Mr. MASTERSON. That is right.

Mr. TOLAND. No. 27, for $58.95.

Mr. MASTERSON. No. 27, $58.95. I do not recall what that is for, unless it would be the balance of the commander's expense account. He would draw like a hundred and a hundred and if it was $258.95 I would make out the check for the balance for the month.

Mr. MAAS. Why were you cashing those checks?

Mr. MASTERSON. I went to the bank. I had access to the bank. I was the only one who could take them to the bank.

Mr. MAAS. Why?

Mr. TOLAND. It was his account.

Mr. MASTERSON. The commander never went to the bank.

Mr. MAAS. Why?

Mr. MASTERSON. I don't know.

Mr. MAAS. You didn't always cash them at the bank?

Mr. MASTERSON. No; I didn't. If I stopped in the morning or the night before and he said, "Get this cashed," the bank is at Frankford and Girard at Third and Walnut and I could get it cashed when working and bring it at night.

Mr. MAAS. Who are the payees on the checks? Are they made out to you?

Mr. MASTERSON. All of them; yes, sir.

The ACTING CHAIRMAN. These checks are prior to the reopening of the Cramp Shipbuilding Yard? They have nothing to do with Cramp?

Mr. MASTERSON. They have nothing to do with Cramp.

Mr. SUTPHIN. Where were you working at the time you were cashing these checks?

Mr. MASTERSON. United States Government, United States Shipping Office, 300 Walnut Street, Philadelphia.

Mr. TOLAND. Check No. 39. Is that made payable to you?

Mr. MASTERSON. Yes, sir.

Mr. TOLAND. It is for $100, signed by Commander Weyerbacher. Mr. MASTERSON. Yes, sir.

Mr. TOLAND. Endorsed by you?

Mr. MASTERSON. Yes, sir.

Mr. TOLAND. Did you receive the proceeds of that check?
Mr. MASTERSON. No, sir.

Mr. TOLAND. Did you give it back to the Commander?

Mr. MASTERSON. Yes, sir.

Mr. TOLAND. Check No. 40.

Mr. MASTERSON. Three hundred dollars.

Mr. TOLAND. Did you receive the proceeds of that check?
Mr. MASTERSON. No, sir.

Mr. TOLAND. You gave it back to the Commander?

Mr. MASTERSON. Right.

Mr. TOLAND. Check No. 50, made payable to you.

Mr. MASTERSON. I received that.

Mr. TOLAND. Check No. 58, 57 I believe it is, for $15.

Mr. MASTERSON. Yes, sir.

Mr. MAAS. What period of time, Mr. Toland, do those checks cover? Mr. TOLAND. This is just the month of March 1939, and this one is May.

Mr. MAAS. What do those March checks total?

Mr. TOLAND. I haven't got the total but I will get it.

I show you what purports to be a statement of the cash account of Commander Weyerbacher from February 28 to March 31, 1939, $4,431.43, showing an advance of $3,000 on February 28 and an advance of $4,500 on March 17, with expenses deduction or disbursement of $4,431.43, with a balance of $3,068.57, and ask you if you ever saw that before.

Mr. MASTERSON. Yes, sir.

Mr. TOLAND. You prepared it, did you?

Mr. MASTERSON. That is correct.

Mr. TOLAND. I offer the checks in evidence.

(Checks above referred to were received in evidence, marked "Exhibit 228 A through K, respectively, and are printed in the appendix of this volume.)

Mr. TOLAND. I offer the statement of the cash account in evidence and ask that it be printed.

(The statement was received in evidence and marked "Exhibit No. 229.")

Voucher

No.

Cash, accounting from Feb. 28 to Mar. 31, 1939—Continued

Amount

Paid to

Condenser Service & Engineering Co....

Bell Telephone Co..

R. D. Weyerbacher.

Condenser Service & Engineering Co..

L. H. Sinclair.

Robt. E. Kinkead.

W. E. Masterson..

S. C. Weston.

34

George Warde.

36

R. D. Weyerbacher.

37

W. E. Masterson.

S. C. Weston.

R. D. Weyerbacher..

Total.

H. E. Rossell.

Condenser Service & Engineering Co.

Purpose

Wages, mechanics and laborers.
Petty cash.

82.84

25.00

The ACTING CHAIRMAN. What is that, Mr. Toland.

1,500.00

Mr. TOLAND. This represents a statement of a cash accounting by Commander Weyerbacher to the Merchant Sterling Co. of moneys received and disbursed by him.

I show you a statement of expenditures of investigation of Wm. Cramp & Sons Ship & Engine Building Co. plant, dated March 20, 1939, in the amount of $1,795.57, with a recapitulation showing professional services of $1,109.23, expense (traveling, etc.) $376.40, supplies $167.10, miscellaneous $60, and Condenser Co. for labor $82.84; received cash $3,000; expended $1,795.57; bank balance $1,204.43; required for balance of month of March, $4,500, and ask you if you ever saw that before.

Mr. MASTERSON. Yes, sir; I prepared it.

Mr. TOLAND. Is it a true and correct copy?
Mr. MASTERSON. Yes, sir.

Mr. TOLAND. I offer it in evidence.

(The statement dated March 20, 1939, was received in evidence. marked "Exhibit No. 230" and is printed in the appendix of this volume.)

Mr. TOLAND. I show you what purports to be a statement of cash accounting from April 1 to April 30, 1939, showing a disbursement of $1,944.30; advance $1,500 on April 8, 1938; balance on hand, $2,624, and ask you if you prepared that?

Mr. MASTERSON. Yes, sir; I did.

Mr. TOLAND. I offer this statement in evidence.

(The statement was received in evidence, marked "Exhibit No. 231," and is printed in the appendix of this volume).

Mr. TOLAND. I show you what purports to be a voucher in support of check No. 58, dated May 3, 1939, professional services, to you in the amount of $15, and ask you what professional services you rendered Commander Weyerbacher?

Mr. MASTERSON. That was the finishing up of the report.
Mr. TOLAND. That is professional service?

Mr. MASTERSON. Yes, sir.

Mr. TOLAND. I offer the voucher in evidence.

(The voucher was received in evidence, marked "Exhibit No. 232" and is printed in the appendix of this volume.

Mr. TOLAND. I show you a voucher for April 27, 1939, made out to support check No. 50, in your name, for $75 for professional services.

Mr. MASTERSON. That is right.

Mr. TOLAND. The same thing?

Mr. MASTERSON. Yes, sir.

(The voucher was received in evidence, marked "Exhibit No. 233" and is printed in the appendix of this volume.)

Mr. TOLAND. I show you what purports to be a statement of a cash account from May 1 to May 3, 1939, and ask you if you prepared that or caused it to be prepared, and if it is true and correct? Mr. MASTERSON. Yes, sir; it is..

Mr. TOLAND. This account that you just identified shows the disbursement of $470.29; balance on hand $2,153.98; after deducting telephone bill, $8.54, $2,145.44. Is that correct?

Mr. MASTERSON. That is correct.

Mr. TOLAND. Did you make that out, too?

Mr. MASTERSON. Yes, sir.

Mr. TOLAND. I submit the statement in evidence.

(The statement was received in evidence, marked "Exhibit No. 234" and is printed in the appendix of this volume.)

Mr. TOLAND. This is an expense voucher of the commander to support check No. 59, in the amount of $141.60. Is that correct?

Mr. MASTERSON. Right.

(The voucher was received in evidence, marked "Exhibit No. 235" and is printed in the appendix of this volume.)

Mr. SUTPHIN. Did you report these moneys received on your income-tax return?

Mr. MASTERSON. Yes, sir.

Mr. TOLAND. Now, Mr. Masterson, I show you the folder of the Merchant-Sterling Co. with regard to the money advanced Commander Weyerbacher, with regard to the attempt to reorganize the yard, and ask you to go over that and pick out all the documents therein that you prepared or caused to be prepared.

Mr. MAAS. Mr. Toland, what was the Merchant-Sterling Co.? Mr. TOLAND. The Merchant-Sterling Co., Mr. Maas, was a company that was organized and held a large number of bonds in the old Cramp Co., first-mortgage bonds.

Mr. MAAS. Did they buy them on the market?

Mr. TOLAND. That I don't know. We are going to inquire from Mr. Ripley when he gets on the stand.

Mr. MAAS. Is there a Merchant-Sterling Co. in existence?

Mr. TOLAND. I think it is in existence but defunct-bankrupt. That is my understanding.

Mr. MAAS. Who is operating Cramp Shipyard now?

Mr. TOLAND. It is still operaitng.

Mr. MAAS. Who operates Cramp Shipyard?

Mr. TOLAND. The Cramp Shipbuilding Co., but the stockholding interest of the Cramp Shipbuilding Co. is in the Harriman, Ripley Co. and the companies that now have an interest or control of it.

Mr. MAAS. Have you a record showing what became of the assets of the Merchant-Sterling Co.?

Mr. TOLAND. Merchant-Sterling still has an office in New York, and, on second thought, I think they still function. We have the records from them.

Mr. MAAS. Are you going to develop the transition from the Merchant-Sterling Co. to the Cramp Co. to the Harriman Co.?

Mr. TOLAND. Right.

The ACTING CHAIRMAN. What would that have to do with these collusive bids?

Mr. TOLAND. Nothing to do with the collusive bids. The only purpose of it is to show the condition of the company at the time of August 1940, or any time in 1940, and the financing of the new company, the transfer of the assets of the old company to the new, the loan by the Government, and the contract for the building of cruisers and other ships.

The ACTING CHAIRMAN. Nothing discovered by the investigators that is questionable regarding those transactions?

Mr. TOLAND. The only purpose is to show just what the facts are: That the plant was closed, that it was being dissipated and the assets of it were being sold, and that attempts were made to open it up by different groups. Finally, a company was organized and a loan was granted on a contract by the Navy, an emergency plant facility loan. Mr. MAAS. Was that to the Merchant-Sterling Co.?

Mr. TOLAND. No.

Mr. MAAS. What were the activities or the business of the MerchantSterling Co. ?

Mr. TOLAND. I am going to produce Mr. Ripley

Mr. MAAS (interposing). Was he connected with Merchant-Sterling Co.?

Mr. TOLAND. Let me show you just what the situation is. Let me briefly say this, so that the record will be clear.

The Cramp Shipbuilding Co. was founded in 1830. In 1872 the company was incorporated as the William Cramp & Sons' Ship & Engine Building Co. The company carried on extensive shipbuilding activities until 1927. At that time, because of losses for the last 2 years of operation, it was decided to terminate the shipbuilding activity of the company and either convert the property to other uses or sell the assets and reduce the indebtedness.

The property was not converted to other uses, but the course of liquidating assets was undertaken. The process was still in progress until a short time previous to the reorganization in 1940, at which time the Cramp Shipbuilding Co., the new company, took over the assets of William Cramp & Sons' Ship & Engine Building Co. The last meeting of the old company prior to the meeting in 1938 was on April 20, 1932, and at that meeting the directors authorized the officials of the company to work out a plan for reopening the yard. It was during this period that Commander Weyerbacher, retired, was conducting a survey to determine the feasibility of reopening the yard. The report was submitted to the Merchant-Sterling Co., who had emploved him for that purpose. Charles F. Rohleder at that time gave Weyerbacher extensive aid in making up the estimates of cost