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EPOSITORY
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
HEARINGS
BEFORE THE
SELECT COMMITTEE
ON IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
EIGHTY-FIFTH CONGRESS
SECOND SESSION
PURSUANT TO SENATE RESOLUTIONS 74 AND 221, 85TH CONGRESS
JANUARY 27, 28, 29, 30, AND 31, 1958
PART 20
Printed for the use of the Select Committee on Improper Activities in the
Labor or Management Field
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
HEARINGS
BEFORE THE
SELECT COMMITTEE
ON IMPROPER ACTIVITIES IN4THE
LABOR OR'MA^fAGlMENT FIELD
EIGHTY-FIFTH CONGRESS
SECOND SESSION
PURSUANT TO SENATE RESOLUTIONS 74 AND 221, 85TH CONGRESS
JANUARY 27, 28, 29, 30, AND 31, 1958
PART 20
Printed for the use of the Select Committee on Improper Activities in the
Labor or Management Field
UNITED STATES
GOVERNMENT PRINTING OFFICE
21243 WASHINGTON : 1958
Boston Public Libniry
Superintendent of Documentg
MAY 2 -1958
SELECT COMMITTEE ON IMPROPER ACTIVITIES IN THE LABOR OR
MANAGEMENT FIELD
JOHN L. McCLELLAN, Arkansas, Chairman
IRVING M. IVES, New York, Vice Chairman
JOHN F. KENNEDY, Massachusetts KARL B. MUNDT, South Dakota
SAM J. ERVIN, Jr., North Carolina BARRY GOLDWATER, Arizona
PAT McNAMARA, Michigan CARL T. CURTIS, Nebraska
Robert F. Kennedy, Chief Counsel
Rdth young Watt, CMef Clerk
U
CONTENTS
International Union of Operating Engineers (Area: Philadelphia,
Chicago)
Page
Appendix 8307
Testimony of:
Acchione, Columbo 8067
Altam uro, Joseph 7976
Balaban, Jack S 8166, 8203, 8237
Bansley, James R 8223
Brady, John F 8281
Braund, Cecil F., Capt 8192
Calabrese, Alphonse F 8097, 8123, 8145, 8157, 8180, 8199, 8239, 8272
Cofini, Robert J 8098, 8123, 8133
Crane, James 8290
Curci, Ormond 801 0
Dawson, Charles R 8028
Dawson, Homer G 7951, 8034, 8049
DiSimone, Paris 8002
Donath, Clarence . 8251
Egan, John J 8112
Fay, Joseph S 8072, 8081, 8095, 8098, 8099
Fero, Fred 8002
Fisher, Raymond S : 8229
Freedman, Abraham 8066
Gale, Norman . 7960
Gould, Marshall T 8203
Healy, Stephen A 8159, 8178, 8183
Kay, Joseph 8036
Lattanzio, Louis 7993
Lavery, Harry W 8041, 8049, 8050, 8052
Leahy, Elizabeth Cecilia 8219
Lentino, Frank 7976
McCartv, T. C, Jr 7960
Moran, Harry J 8166, 8272
Mimdie, James 8155, 8189, 8198, 8243
Piscitilli, Edward J 8050
Piscitilli, John ^ 8023
Press, Charles W 8251
Prinos, John 8139, 8146
Salinger, Pierre E. G 8249
Sylvester, Joe 8010
Underwood, Roy J 7923, 8071, 8081
Valentino, Joseph 8002
Weber, Peter W 8117, 8124, 8128, 8134, 8140, 8146
Wharton, Hunter P 8051, 8062
Williams, Michael 8010
17
(CONTENTS
EXHIBITS
Introduced Appears
77. Pictures of Mr. McCarty taken the day after the beating on page on page
March 4, 1953 7966 (*)
78. Newspaper picture dated March 10, 1953, "Beating of
Union Man Aired in Magistrate's Court" 7981 (*)
79 A. Letter dated April 2, 1946 to Local Union No. 542 of
Operating Engineers preferring charges against Jasper
White and signed by Charles R. Dawson 8030 8307
79B. Letter dated April 2, 1946 to Local Union 542 of Oper-
ating Engineers preferring charges against Tom
Barrett and signed by Charles R. Dawson 8030 8308
80. Anti-racketeering resolution submitted to the 25th
Convention of the International Union of Operating
Engineers, AFL-CIO, April 9, 1956 signed by Columbo
Acchione Local Union 542-542-A-B, Philadelphia, Pa. 8069 8309
81. Report of findings by Thomas J. Clary in the United
States District Court for the Eastern District of
of Pennsylvania, Roy Underwood v. William Maloney
and Homer Dawson v. William E. Maloney and
Hunter P. Wharton 8083 (*)
82. Resolution adopted at a meeting of Locals 825, 825-A,
825-B, 825-C, 825-D held on May 21, 1956 concerning
Joseph S. Fay 8091 (*)
83. An agreement entered into by and between Public
Construction, Inc. and the International Union of
Operating Engineers, dated October 7, 1957, signed
by Porter W. Weber 8137 (*)
84. Check dated January 31, 1951, payable to O. B. Soueie
in the amount of $5,000 signed by Wm. E. Maloney... 8158 8310
85. Check dated January 24, 1951, payable to O. B. Soueie
(P. O. Soueie) in the amount of $5,000 made by the
S. A. Healy Co 8158 8311
86. Check No. A21823, dated February 2, 1949, payable to
Mrs. James C. McGann or Howard Bond in the
amount of $35,000 drawn on International Union of
Operating Engineers (expense account) 8191 8312
86A. Voucher No. A21823 dated February 2, 1949, payable
to Mrs. James C. McGann or Howard Bond in the
amount of $35,000 drawn on International Union of
Operating Engineers 8191 8313
87. Minutes of the meeting of the general executive board
of the International Union of Operating Engineers
held at the Alcazar Hotel, Miami, Fla., February
1-9, 1949 8192 (*)
88. Picture of the yatch. Half Moon owned by the Operat-
ing Engineers 8193 8314
89. Picture of the home of William Maloney in Florida 8195 8315
90. Ledger sheets for the years 1949, 1950, 1951, 1952,
1953, 1954, 1955 and 1956 showing expenses of operat-
ing the //«// il/oon 8198 (*)
91. Worksheet showing capitulation of the expenses of the
boat for the years 1949 through 1956 8199 (*)
92. Documents showing expenses of the European trip of
William E. Maloney and wife to attend the Inter-
national Labor Conference in Geneva, Switzerland,
June 7, to July 1, 1950 . .. 8203 (*)
93. Worksheets showing income received by William E.
Maloney that was not reported on income-tax re-
turns 8205 (*)
94. Documents and vouchers supporting the worksheet
figures 8205 (*)
95. Worksheet showing expenses paid to or for William E.
Maloney for the calendar year 1956 8213 (*)
96. Documents, vouchers, and canceled checks supporting
the worksheet figures 8213 (*)
*May be found In tlie files of the select committee.
CONTENTS V
97. Worksheet International Union of Operating Engineers introduced Appears
expenses paid for William Maloney, 1950 through oa page on page
1955 8216 (*)
98. Documents supporting the worksheet which is exhibit
97 8216 (*)
99. Worksheet showing expenses 1950 through 1955 of se-
lected meetings, paid for William Maloney by Oper-
ating Engineers 8218 (*)
100. Voucher and check No. B 1889 dated March 22, 1951,
payable to William E. Maloney in the amount of $270,
drawn on International Union of Operating Engineers
with statement 8218 8316
101. Ledger sheet showing general executive board meetings 8317
1950 (defense fund) expense allowance (Maloney)
$700 8221 8318
102. Ledger sheet showing A. F. of L. expenses 1955 (defense
fund) expenses (Maloney) $3,500 8221 8319
103. Four ledger sheets recording actual expenses and salary
for William E. Maloney for 1955 8222 (*)
104. Constitution of the International Union of Operating
Engineers 8229 (*)
104A. Amended constitution of the International Union of Op-
erating Engineers 8229 (*)
105. Worksheet showing number of local, date placed under
supervision, the supervisor, number of membership,
and amount of assets 8242 (*)
106. Breakdown in the A, B, C, D, and E category of the
unions under trusteeship ^^ 8243 (*)
107. Invoices and documents showing a Cadillac automobile
was purchased June 10, 1950 for William E. Maloney
in the amount of $4,590.40 8244 (*)
108. Invoice and documents showing new Cadillac automobile
purchased for William E. Malonev April 29, 1952.
Amount of sale $5,417.70 paid for by the International
Union of Operating Engineers .i 8245 (*)
109. Check and documents showing purchase of a Cadillac,
February 25, 1954, in the amount of $5,800.17 in the
name of William E. Maloney and paid for by local
150 8246 (*)
110. Documents and check showing purchase of a Cadillac",
December 2, 1955, in the amount of $6,557.11 for
William E. Maloney and paid for by Local 150 Operat-
ing Engineers __ 8246 (*)
111. Check and voucher No. B 6643 dated March 31, 1952,
payable to Capitol Cadillac Oldsmobile Co., in the
amount of $5,013.65 drawn on International Union of
Operating Engineers (expense account) and receipt
No. 8361 8247 8320
112. Settlement statement from DeCozen East Orange Co.", " 8321
che?k and voucher No. 7138, dated December 26, 1957,
payable to DeCozen East Orange Co. in the amount
of $6,481 drawn on International Union of Operating
Engineers (general fund, expense account) 8248 83'^'>-
113. Invoice and check No. 3244 dated July 28, 1953, payable 8323
to Rabin's Appliance & Furniture Co., in the amount
of $652 drawn on local No. 150 for water cooler and
air conditioner 8248 8324-
114. Invoice and check No. 2765, dated January 18, 1954, 8325
payable to Rabin's Appliance & Furniture Co., in the
amount of $289.45 drawn on local 150B for RCA
Victor television set 8249 8326-
115. Staff memorandum referring to the activities of Wiliia"m 8327
E. Maloney with respect to local 150 8251 (*)
116. Excerpts of letters written by Mr. Zeigler to William
Green during the 1930's 8255 (*)
117. Telegram sent to local 150 by j"ohn Possehl on Januarv
16, 1934 : 8259 (*)
♦May be found in the files of the select committee.
VI CONTENTS
Introduced Appears
118. Minutes of meeting of local 150, A, B, and C held in on page ou page
Chicago on March 22, 1956 8261 (*)
119. Minutes of meeting of local 150, A, B, and C held in
Chicago, April 26, 1956 8262 (*)
120. Letter dated May 8, 1956, to William E. Maloney and
signed by president of Local 150, lUOE 8263 (*)
120A. Letter dated May 8, 1956 to James P. Crane, president
of local 150, from William E. Maloney, general presi-
dent 8263 (*)
121. Letter dated July 31, 1957 to Wilham E. Maloney,
general president, lUOE, from president, local 150,
Chicago 8263 (*)
122. Summary of improper and questionable use of local 399
funds by Andrew F. Leach and Anton J. Imhahn... 8274 (*)
122A. Records and documents from which items in question
were taken 8281 (*)
123. Affidavit of Wilham Gordon dated January 17, 1958--. 8276 (*)
Proceedings of —
January 27, 1958 7923
January 28, 1958 7993
January 29, 1958 8095
January 30, 1958 8183
January 31, 1958 8237
*May be found in the files of the select committee.
INVESTIGATION OF OIPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
MONDAY, JANUARY 27, 1958
United States Senate,
Select Committee on Improper Activities
IN THE Labor or Management Field,
Washington^ D. G.
The select committee convened at 2 p. m., pursuant to Senate Resolu-
tion 74, agreed to January 30, 1957, in the caucus room. Senate Office
Building, Senator Jolm L. McClellan (chairman of the select com-
mittee) presiding.
Members of the select committee present: Senator John L. Mc-
Clellan, Democrat, Arkansas; Senator Irving M. Ives, Republican,
New York; Senator John F. Kennedy, Democrat, Massachusetts;
Senator Sam J. Ervin, Jr., Democrat, North Carolina ; Senator Pat
McNamara, Democrat, Michigan; Senator Barry Goldwater, Repub-
lican, Arizona; Senator Karl E. Mimdt, Republican, South Dakota;
Senator Carl T. Curtis, Republican, Nebraska.
Present: Robert F. Kennedy, chief counsel; Jerome S. Adlerman,
assistant chief counsel ; Jack S. Balaban, a GAO investigator on loan
to the committee ; Ruth Young Watt, chief clerk.
The Chairman. The committee will be in order.
(Members of the select committee present at the convening of the
session were Senators McClellan, Ervin, and Curtis.)
The Chairman. Call the next witness.
Mr. Kennedy. Mr. Roy J. Underwood, Mr. Chairman.
The Chairman. You do solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Underwood. I do.
TESTIMONY OF ROY J. UNDERWOOD
The Chairman. State your name, and your place of residence and
your business or occupation.
Mr. Underwood. My name is Roy J. Underwood. I live at 2801
Garrett Road, Drexell Hill, Pa., and I am an operating engineer.
The Chairman. Do you waive counsel ?
Mr. Underwood. Yes, sir.
The Chairman. You have a right to have an attorney present to
advise you of your legal rights while you testify, and you may waive
that right if you desire.
Mr. Underwood. I do, sir.
The Chairman. Thank you very much.
7923
7924 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy, proceed.
Mr. Kennedy. You have been a member of the Operating Engi-
neers for how long ?
Mr. Underwood. Since 1937.
Mr. Kennedy. Did you hold an official position with the Operating
Engineers ?
Mr. Underwood. Yes, sir ; I did.
Mr. Kennedy. "Wlien was that ?
Mr. Underwood. From 1948 until 1952.
Mr. Kennedy. What position did you hold ?
Mr. Underwood. I was elected president and business manager.
Mr. Kennedy. Of what union ?
Mr. Underwood. Local 542, International Union of Operating
Engineers, of Philadelphia.
Mr. Kennedy. What areas does local 542 cover ?
Mr. Underwood. Its territorial jurisdiction covers the eastern 34
countit;s of Pennsylvania, and the entire State of Delaware.
Mr. Kennedy. Could you tell the committee a little bit about the
history of the local, or start back when you first joined it. What was
the situation and the condition at that time?
Mr. Underavood. At the time I joined the local, of course, it was
under the supervision of Joseph S. Fay.
Mr. Kennedy. What do you mean it was under the supervision of
Joseph Fay ?
Mr. Underwood. He had been appointed as supervisor or trustee
of the union, and prior to the time I joined it in 1937, just how long
he had held that position prior to that I don't know. That was the
situation at the time I joined the local.
Mr. Kennedy. Do you know how long the union had been in
existence prior to the time you joined it ?
Mr. Underwood. It had been in existence^ — I am trying to think
of the date now — but for several years, in any event.
Mr. Kennedy. Do you know how long Joey Fay had been trustee
of the local?
Mr. Underwood. I don't know exactly how long. However, from
what I could determine by talking to other members, who had pre-
viously been members of the union, it had been under trusteeship as
long as they could.
Mr. Kennedy. Did they understand that the local had been in
trusteeship since its inception ?
Mr. Underwood. Yes, sir ; that was my understanding.
Mr. Kennedy. And it was Joey Fay who was the trustee during
that period of time ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Who was international president then, during the
1930's?
Mr. Underwood. During that period in the late 1930's, when I was
a member, Mr. Huddel— I believe it was Huddel or Poszel, and I am
not certain which one it was who was the general president.
Mr. Kennedy. Now, you worked in the local. You were a member
of the local while Joey Fay was trustee?
Mr. Underw^ood. Yes, sir.
Mr. Kennedy. He held an official position in the local 825 in
Newark, N. J.?
IMPROPER ACTrVITIES IX THE Lu\BOR FIELD 7925
Mr. I'nderwood. Yes, sir.
Mr. Kennedy. At that time ?
]\Ir. Underwood. Yes, sir.
Mr. Kennedy. And he was also the sixth vice president of the Oper-
ating Engineers?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Did lie have anybody under him conducting the
administration of the local when he was a trustee?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Could you tell us about that ?
Mr. Underwood. Well, one Jasper H. White was his assistant super-
visor, and who actually managed the affairs of the union under the
trusteeship of Joey Fay. William Carter, of local 825, of New Jersey,
also participated in administering the aft'airs of local 542.
Mr. Kennedy. Where was Jasper White from ?
Mr. Underwood. He was from out of 825, Joey Fay's local, in
Newark, N. J.
Mr. Kennedy. So Joey Fay brought two of his people down from
Newark, N. J., to operate this local in Philadelphia; is that right?
Mr. Underwood. Yes, sir ; that is correct.
Mr. Kennedy. Would you tell the committee what the conditions
are when a local is under trusteeship, as far as the rights of the
members are concerned?
Mr. Underavood. Well, the membership have no rights wliatsoever
under the trusteeship as spelled out in the constitution. They are not
permitted, of course, to vote on any questions coming before the mem-
bership, and they are not permittecl to participate in the administi-ation
of aif airs of the union, and they can't negotiate for their own contracts
or participate in the negotiating, and they don't have the right to
approve the contracts after they are entered into by a trustee.
They have nothing to say about disbursement of funds, and nothing
to say about the employment of agents, business agents. They have
nothing at all to say about any affairs of the local union including the
enforcement of contracts.
Mr. Kennedy. What about the selection of officers. Do they have
anything to say about that ?
Mr. Underwood. Absolutely nothing; no elections are held at any
time.
Mr. Kennedy. All of those decisions were made by Joey Fay, and
the individuals, Carter and White, who were working under him? Is
that right?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And you say there was no control over the finances
of the local ?
Mr. Underwood. None whatever.
Mr. Kennedy. Did the members ever attempt to find out how the
money was being spent ?
Mr. Underwood. Yes, sir ; they did, on a number of occasions.
Mr. Kennedy. What would the response be from Joey Fay or his
assistants ?
Mr. Underwood. Well, Joey Fay also brought with him, when he
came over to the local union, a gang of men, hoods as we characterized
them, and they would stand on the side of the meeting hall or patrol
up and down the aisles, and anybody who asked a question about
7926 EVIPROPEIR ACTIYITIES IN THE K\BOR FIELD
finances, or anything else affecting the membership of the local union,
would be told to sit down and shut up.
These men would glare at him and make gestures, and threatening
gestures toward them. There was no information that could ever be
gotten from Joey Fay or any of his assistants.
Mr. Kennedy. What about the contracts ? Could you find out any-
thing about the contracts under which you were working?
Mr. Underwood. No, sir ; we could not.
Mr. Kennedy. You did not have the right to ask, as a member of
the union, for a copy of the contract or for the leadership to set forth
the conditions under which you were working ?
Mr. Underwood. No, sir.
Mr. Kennedy. They would not give you that information ?
Mr. Underwood. No, sir.
Mr. Kennedy. You talk about "goons" coming in from New Jersey
and patrolling the sides, the front and the back of your meeting hall,
is that right ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And you say that individual members of the local
were threatened ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Were any of them ever beaten up during this period
of time under the administration of Joey Fay ?
Mr. Underwood. Yes, sir ; they were.
Mr. Kennedy. Do you have any of their names ?
Mr. Underwood. Yes ; one was Ray Dawson, who was beaten very
badly and thrown on the floor and knocked to the floor, and kicked.
Another one was Lou Finney.
Mr. Kennedy. For what reason was Dawson beaten ?
Mr. Underwood. Dawson at that time was participating in a move-
ment to regain local autonomy. An action had been filed in the court
in Philadelphia to restore local autonomy and terminate supervision.
It was because of that, that he was set upon by some of Joey Fay's
agents, business agents and others, and beaten very badly.
Senator Curtis. At that point, where did this beating of Dawson
occur?
Mr. Underwood. In the meeting hall, sir.
Senator Curtis. In the meeting hall in Philadelphia ?
Mr. Underwood, Yes, sir.
Senator Curtis. Do you recall about when that was ?
Mr. Underwood, It was in 1946. I believe it was late 1946.
Senator Curtis. Were you present in the meeting ?
Mr, Underwood. Yes, sir, I was.
Senator Curtis. How large a crowd was there, roughly? Were
there 100, 200, 500 men ?
Mr. Underwood. Probably about 100 men.
Senator Curtis. Did more than one individual assault him ?
Mr. Underwood. Yes, sir.
(At this point. Senator Goldwater entered the room.)
Senator Curtis. How many would you say ?
Mr. Underwood, There were several who would gang around him
and surround him wliile the ones on the inside would beat him and get
him down on the floor and put their feet on him.
Senator Curtis. And you saw this ?
IMPROPER ACTIViTIES Ix\ THE LABOR FIELD 7927
Mr. Underwood. Oh, yes.
Senator Curtis. "Wlio was presiding over the meeting ?
Mr. Underwood. I am not certain whether Joey Fay himself was
presiding or whether a president he had appointed, Mr. Mogan, was
presiding.
Senator Curtis. Wliat was his name ?
Mr. Underwood. Michael F. Mogan, and he is now deceased.
Senator Curtis. But Mr. Fay was president ?
Mr. Underwood. I am quite sure he was on that occasion, yes, sir.
Senator Curtis. Who were some of the other men who were in charge
or taking some part in running the meeting that were present, as you
recall ?
Mr. Underwood. I believe that John Carter, who was also out of
local 825, was sent over and made a business agent of that union. I
believe he was president. They were the only ones, and Jasper White,
and John Carter, Joey Fay were the only ones that I recall ever
presiding.
Senator Curtis. Now, after this assault was over, did you observe
Dawson so you could tell us a little bit how badly he was injured ?
Mr. Underwood. Yes, sir, I did observe him.
Senator Curtis. How badly was he injured ?
Mr. Underwood. He seemed to be very badly injured. He was cov-
ered with blood, the front of his shirt was red with blood, and when he
got up off the floor, of course, he was taken to the hospital immediately,
and his face was badly marked up, and there were cuts and bruises.
There were cuts at least, at that time, on his face and on his forehead
and he complained, and he was bent over, and he complained of pains
in the ribs where he had been kicked.
Senator Curtis. Do you know how long he stayed in the hospital ?
Mr. Underwood. I don't know, but I know he was under treatment
for sometime thereafter.
Senator Curtis. Was he kicked while he was down ?
Mr. Underwood. While he was on the floor.
Senator Curtis. Was he kicked in the face or the head ?
Mr. Underwood, tie was kicked around about the body, and whether
he was kicked about the face, while he was on the floor, I don't know,
or whether he got up before he hit the floor. There were people sur-
rounding him, and I could see feet flying underneath, and I saw arms
moving and clinched fists flying inside this group, but it was difficult
to see all of the details.
Senator Curtis. About how many goons would they bring over ?
Mr. Underwood. They would bring ordinarily about 5 or 6.
Senator Curtis. And they were pretty rough men ?
Mr. Underwood. Yes, sir, and thej^ had all of the physical character-
istics that you would normally associate with people of that kind, big
strapping fellows, 6 foot 2, and 6 foot 4, and 6 foot 6.
Senator Curtis. Was any effort made by those conducting the meet-
ing to stop this ?
Mr. Underwood. No, sir.
Senator Curtis. It had all of the appearances of being done with
their consent and encouragement ?
Mr. Underwood. Yes, sir.
Senator Curtis. That is all, Mr. Chairman.
7928 IMPROPER ACTivrriBS in the labor fteld
Mr. Kennedy. Now, were there other people beaten up other than
Dawson, whom you described ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. During this period of time ?
Mr. Underwood. Yes, sir, a member named Lou Finney, an operat-
ing engineer. He was beaten up also at the meeting.
Mr. Kennedy. What was he beaten up for ?
Mr. Underwood, I don't know. At the time he was sympathetic, of
course, to the move and had expressed himself as being sympathetic
with the move to regain autonomy for the union, and it was well
known, of course, that he was in support of this movement. But I was
not there at the moment when he was attacked. But I heard that he
was being attacked and I came back upstairs, and the meeting had just
adjourned incidentally when this occurred.
I came back upstairs and I saw him and in fact I walked into the
washroom where he was washing his face, to wash the blood off his
face.
The Chairman. All they were trying to do was get the union out of
trusteeship and get it back where they could have some control over
their own affairs ?
Mr. Underwood. In the courts, yes, sir, at the time, they were trying
to do something.
The Chairman. They had brought action in the courts to do that?
Mr. Underwood. Yes, sir.
The Chairman. Were these men that were beaten up, Lou Finney,
was he one of the parties who brought the suit ?
Mr. Underwood. No ; he was not one of the ones who brought the
suit. However ,a group had indicated their support from time to
time.
The Chairman, He was one of those supporting, one of the members
who was supporting those who were making an effort to get the trustee-
ship removed and get the union affairs back in the control of the local?
Mr. Underwood. Yes, sir ; that is right. We simply asked for the
right to have an election.
The Chairman. Just seeking the right to have an election ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And wdio else ?
Mr. Under^vood. Sam Morris. Sam Morris was another member
who had gotten up at a meeting of the union, the previous meeting of
the union, and asked some questions about the purchase of Cadillac
automobiles for the business agents. He was told to shut up and sit
down ; and the following day, I believe it was — I am sure it was the
following day — we were out in front of the office of the union, on the
sidewalk, as was customary ; the men would gather there and wait to
be assigned jobs when they came in. Jasper White came up to Sam
Morris, and I was about 10 or 12 feet from him, and Jasper White
said, "When are you going to learn to keep your mouth shut?"
And he said, "Well, I have a right to ask some questions," "Well,"
he said, "I will shut your mouth for you"; and he was with one other
person whom I had never seen before in the union, and he struck him
in the jaw and knocked him down.
And he was very severely hijured, and he now carries a plate in his
mouth, and he lost all of his teeth, and he was a rather elderly man
IMPROPER ACTIVITIES IN THE LABOR FIELD 7929
at that time, and his jaw is all wired up now to this day because of
that blow.
The Chairman. What year did that happen in ?
Mr. Underwood. That also was in 1946.
(At this point the following members were present: Senators Mc-
Clellan, Goldwater, Ervin, and Curtis.)
Mr. Kennedy. Mr. Underwood, Mr. William E. Maloney became
international president of the union in 1940 ; is that right ?
Mr. Underwood. That is right.
Mr. Kennedy. Did he attempt to make any change in the operation
of this local after he became president ?
Mr. Underwood. No, sir.
Mr. Kennedy. There had been complaints from the members on the
way the union was being run, and complaints that they wanted back
their autonomy. Did he take any steps to try to restore the autonomy
to the members ?
Mr. Underwood. No, sir ; he did not.
Mr. Kennedy. Did he take steps to remove Joey Fay from this
position of authority over the local 'I
Mr. Underwood. No, sir. He continued Fay as the trustee of the
union. Fay announced on the floor at meetings anybody who had an
idea that he was going to get out of there or be removed as trustee
was very badly mistaken.
He condemned, of course, later on, anybody that might have an idea
that they could go to a lawyer or go to court and do anything about it.
Mr. Kennedy. So all of these conditions that you have described,
not having a right to see the contract, not having a right to ask about
the finances and these meetings, all continued after William Maloney
became international president ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. He did nothing to alleviate the conditions ?
Mr. Underw^ood. Nothing whatever.
Mr. Kennedy. So the members continuing through 1940 still had
no right to vote for their leadership ; is that right ?
Mr. Underwood. That is right, sir.
Mr. Kennedy. In 1942 — we were talking about Jasper White hav-
ing a position of authority under Joey Fay — was there a grand- jury
investigation in 1942, going into the finances and other conditions of
the local ?
Mr. Underwood. Yes, sir ; there was, in 1942 or 1943.
Mr. Kennedy. Around that period of time ?
Mr. Underwood. Yes ; right in that period.
Mr. Kennedy. Did Mr. J asper White appear before the grand jury ?
Mr. Underwood. Yes, sir ; he did.
Mr. Kennedy. Will you tell us what happened, what position he
took, and what the grand jury w^as trying to learn or find out?
Mr. Underwood. The grand jury has subpenaed the records of the
local union, which were then under international control, and Jasper
White on behalf of the international officers, refused to produce the
books and records on the grounds that their production would tend
to incriminate the officers.
Mr. Kennedy. He refused to produce the books and records of the
local union on the grounds that to produce same would incriminate
him?
7930 IMPROPER ACTIVrXIE'S IX THE LABOR FIELD
Mr. Underwood. Incriminate him and the other officers.
Mr. Kennedy. The officers of the local ?
Mr. Underwood. The international officers.
Mr. Kennedy. What position did the court take on that ?
Mr. Underwood. The court held him in contempt. He ultimately
was sentenced, I believe, to 30 days for contempt. It was taken up to
the United States Supreme Court, and they sustained the findings of
the lower court, sentencing him to 30 days for contempt.
(At this point. Senator ]\Iundt entered the hearing room.)
Mr. Kennedy. He served that time ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. When he refused to answer these questions and re-
fused to produce the books, did the international take any action
against him for that ?
Mr. Underwood. No, sir.
Mr. Kennedy. Did he continue in the same position ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Even though he refused to turn over the books of
the local, not just his own books but the books of the local, on the
ground that this might tend to incriminate him and the other officers
of that local ?
Mr. Underwood. Yes, sir ; that is correct.
Mr. Kennedy. And he continued in a position of authority through
and after 1943, is that right ?
Mr. ITnderwood. Yes, sir.
Mr. Kennedy. And under Joey Fay ?
Mr. ITnderwood. Yes, sir.
The Chairman. Did the grand jury ever get the books ?
Mr. Underwood. I don't know what the final disposition of the books
was. sir.
Mr. Kennedy. Was Joey Fay putting any special assessment on the
membership during this period of time ?
Mr. Underwood. Yes, sir ; he was.
Mr. Kennedy. Would you tell us what he was doing, as far as that
is concerned ?
Mr, Underwood. Well, in 1987, when I had joined the union, there
had been then, going on for a period of time, a 5 percent assess-
ment, or, as we termed it, a kickback of the wages of all members of the
union.
In 1937 there had been so much objection to it by the members it
was reduced to 3 percent of their wages. That continued, that assess-
ment continued, up until late 1940. Then, in addition to that assess-
ment, all members of the branches of local 542 ; that is, the members
of local A, B, had to pay $2.50 a week into the union office in addition
to their dues if they were performing any work that was normally
done by the members of the parent body, such as the operation of
cranes, shovels, compressors, welding machines, and so forth. That
assessment of $2.50 a week continued up until the time supervision
was terminated in 1948 by court order.
Mr. Kennedy. So you had two different kinds of assessment — the
5 percent, which was later lowered to 3 percent, and then the $2.50
for those in the A and B categories, who were doing the work of the
parent union ?
]\Ir. Under wo(^D. Yes, sir.
IMPROPER ACTIVITIES IN THE L.\BOR FIELD 7931
(At this point, Senator Gold^^^ater withdrew from the hearing
room.)
Mr. Kennedy. The 5 percent must have amounted to a great deal
of money during this period, did it not ?
Mr. Underwood. It must liave amounted to a tremendous amount of
money.
Mr. Kennedy. That is 5 percent of all of the salaries of the mem-
bers of the local ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. They all had to pay in this 5 percent?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Were the union members informed as to how this
money was used, what it went for ?
Mr. Underwood. No, sir. When a question was asked — I recall
Joe Fay being asked at a meeting what they were going to do with
this money, or why they were assessing the members, and he said,
"We are doing it because we need it," and that is it.
Mr, Kennedy. But you never learned how he needed it or what was
done with the money ?
Mr. Underwood. No, sir.
Mr. Kennedy. No books or records were ever presented to the
membership regarding that money ?
Mr. Underwood. No, sir.
Mr. Kennedy, You talked about various conditions. As far as the
contractors were concerned, was there any close relationship between
Joey Fay and other officials or any particular contractors? Were
;any specific contractors favored over others during this period?
M. Underwood. Yes, sir; they were. That was developed more
fully, of course, in an arbitration proceeding which took place in 1948
after supervision was terminated.
However, during the period of time prior to 1948, I, myself,
on a number of occasions, was told when I complained about con-
tractors not observing or not complying with what we thought the
agreement to be, I was told by the union office, Jasper White, usually,
if I wanted to stay on the job, keep my mouth shut, and if I didn't
like the conditions the way they were, get off of the job. I was also
told by a contractor on one occasion that —
You can call your union hall if you want to, but it will do you no good, and you
will only wind up losing your job.
Mr. Kennedy. What were some of these contractors that were
favored ?
Mr. Underwood. Well, Buckley & Co. was one. Incidentally, these
people were the ones that negotiated the agreements with Joe Fay and
liis assistant. Harry R, Halloran was another one.
Those two occur to me. The other names escape me.
Mr. Kennedy. But those two were favored during the administra-
tion of Joey Fay ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Joey Fay was indicted himself for extortion: I be-
lieve in 1943.
Mr. Underwood. Yes, sir.
Mr. Kennedy. Was he removed from his position at that time by
William E. Maloney ?
Mr. UnderwiQod. Np, sir : he was not.
7932 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. He was continued in as operator and trustee of the
local even after he had been indicted ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And he was convicted, I believe, in 1943. Did he
still remain in that position ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Even after he was convicted ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And then he took an appeal to the Supreme Court.
Did he remain in as trustee during this whole period of time?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Until the time he went to j ail ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. He still ran the union ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Even though he had been indicted and found guilty
in the lower courts ?
Mr. Underwood. That is correct, sir.
Mr. Kennedy. What was the sentence at that time that he was under
indictment ; do you know ?
Mr. Underwood. 7^2 to 15 years.
Mr. Kennedy. And he still remained in control of the local although
he had been sentenced to that time in jail, is that right?
Mr. Underwood. Yes.
Mr. Kennedy. I mean, up until the time he went to jail ?
Mr. Underwood. Yes, sir ; up until the time he went to jail.
The Chairman. The international officers, authorities, took no ac-
tion whatever to suspend him during that period ?
Mr. Underwood. No, sir.
The Chairman. Did he still have as much authority during that
time as he had before ^
Mr. Underwood. Yes, sir ; eveiy bit as much.
The Chairman. And exercised it ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. When were you able to ultimately get out of this
trusteeship and start to elect your own officex's ?
Mr. Underwood. Well, Ave had liled an action, of course, in the com-
mon-pleas court in Philadelphia, asking for a termination of the trus-
teeship and an accounting of the funds that they had received during
the period it was under trusteeship.
This came on for trial in December of 191:6. At that time, Mr. Ma-
loney's lawyers and our lawyer entered into a stipulation providing
for an election to be held, which, first — two elections, actually.
The lirst election was to determine whether or not the members
wished to termiiuite supervision, and then, after the vote was taken on
that — of course, it was overwhelmingly in favor of termination — and
then an election of officers was held under supervision of the court.
Mr. Kennedy. When you had the vote as to whether or not you
should terminate the supervision, you sa}' the vote was overwhelm-
ingly in favor of terminating supervision ^
Mr. Underwood. Yes, sir.
Mr. Kennedy. Then you had an election for officers?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Who was elected president at that time ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 7933
Mr. Underwood. I was elected president and business manager at
that time, sir.
Mr. Kennedy. You were elected president and business manager ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And that election was held under the supervision
of the court ?
Mr, Underwood. Yes, sir.
Mr. Kennedy. What was the arrangement with the outgoing offi-
cers, the people that had been let in by Joey Fay ?
Mr. Underwood. Well, part of the stipulation was that they be
given a release and not be required to account for any of the funds
they handled during the period of supervision.
Mr. Kennedy. You had to agree not to question or ask them about
any of the funds that they had control over during supervision, is
that right?
Mr. Underwood. Yes, sir ; that is right,
INIr. Kennedy. You could not ask for an accounting of any of the
moneys that had been coming into the local ?
Mr. Underwood. No, sir. We could not, by the terms of settlement.
Mr. Kennedy. In order to get freedom from the international, you
had to agree to that ?
Mr. Underwood, Yes, sir.
Senator Mundt. Mr. Chairman ?
Mr. Underwood, after Mr. Fay went to jail, who ran the union then,
between then and the time you Avere elected president ?
Mr. Underwood. After Mr. Fay went to jail, John J. McDonald, an
international vice president, was sent into Philadelphia by Mr. Ma-
loney to manage the affairs of the union pending the outcome of this
lawsuit that had been filed.
Senator Mundt. How long was Mr. McDonald in charge ?
Mr. Underwood. Well, he came in about, I think it was, March or
April of 1947.
Senator Mundt. And stayed until when ?
Mr. Underwood. He stayed until — of course, he stayed in the area
until 1952, but he stayed in as supervisor at that time until the officers
under the court-supervised election were installed in office.
That was March 29, 1948.
Senator Mundt. A little over a year, or about a year ?
Mr. Underwood. Very close to a year, yes.
Senator Mundt. I was not clear about your stipulation, whether
you were stopped from asking for an accounting of the funds just
during the period that Mr. McDonald was in charge or during the
entire period that you had people appointed by Maloney in charge.
Mr. Underwood. Well, of course
The Chairman. If the Senator will yield to me, I will introduce
those in evidence at this time.
Senator MuNO^r. You will introduce what ?
The Chairman. The documents releasing the officers, and also re-
leasing the local, the conditions under which this was settled.
Senator Mundt. All right.
The Chairman. I hand you here a photostatic copy of a document —
what appears to be a copy of a document, because it is not signed —
21243— 58— pt. 20 2
7934 IMPROPER ACTIVITIES m THE LABOR FIELD
dated the 22d day of October 1948, and I ask you to examine it and
state if you identify it. If so, state what it is.
(Document handed to the witness.)
Mr. Underwood. This is a copy of the release that we were required
to give to all of the officers named in the bill of complaint.
The Chairman. It may be printed in the record in full at this point.
There is some part of it that is a little blurred, that I could not read.
(The document referred to follows :)
Know all men by these presents, that Local 524, International Union of Oper-
ating Engineers, shall hereby remise, release, and forever discharge the Inter-
national Union of Opei'ating Engineers, an unincorporated association, 1003 K
Street NW., Washington, D. C. ; William E. Maloney, general president ; William
Welsh, first vice president ; Anton .1. Imhahn, second vice president ; John J.
McDonald, third vice president; Joseph J. Delaney, fourth vice president;
Frank P. Converse, fifth vice president ; Charles B. Gramling, sixth vice presi-
dent ; Victor S. Swanson, seventh vice president ; and Franli A. Fitzgerald,
secretary-treasurer, their heirs, executors, and administrators, of and from all,
and all manner of, actions and causes of action, suits, debts, dues, accounts,
bonds, covenants, contracts, agreements, judgments, claims, and demands what-
soever in law or equity, especially any claims arising during the period of
international supervision of the affairs of Local 542, International Union of
Operating Engineers, during the period from October 15, 1935, which against
the said International Union of Operating Engineers : William E. Maloney,
general president ; William Welsh, first vice president ; Anton J. Imhahn, second
vice president ; John .T. McDonald, third vice president ; Joseph J. Delaney, fourth
vice president ; Franli P. Converse, fifth vice president ; Charles B. Gramling,
sixth vice president ; Victor S. Swanson, seventh vice president ; and Frank A.
Fitzgerald, secretary-treasurer, the said Local 542, International Union of
Operating Engineers, ever had, now has, or hereafter can, shall or may have,
for, or by reason of any cause, matter or thing whatsoever, from the beginning
of the world to the date of these presents.
In witness whereof, local 542 has caused this release to be executed by its
duly authorized president this 22d day of October 1948.
Local 542,
[seal] By , President.
Signed, sealed, and delivered in the presence of :
The Chairman. Did you sign that release, the original, as
president ?
Mr. Underwood. Yes, sir ; I did.
The Chairman. Why did you sign it ?
Mr. Underwood. Well, on the iidvice of our counsel who had par-
ticipated in the stipulation of settlement. He told me that that was
part of the settlement, and it was necessary that this release be given
as to all officers named in the complaint.
The Chairman. I said that the document could be printed in the
record at this point.
That stipulation just applied to the officers ; did it not ?
Mr. Underwood. Yes, sir.
The Chairman. I hand you a photostatic copy of another one,
dated the same day, 22d day of October 1948, which, as I read it,
applies to the union itself, ancl possibly the international.
I ask you to examine that document and state if you identify it.
( Document handed to the witness. )
Mr. Underwood. Yes, sir. That is the release that applied to the
local, what they termed to be the local officers at the time this stipu-
lation was entered into.
IMPROPER ACTTVITIES IN THE LABOR FIELD 7935
The CiiAiRiMAN. There are two of them. Wliat is the difference
between the two ? This one may also be printed in the record at this
point.
(The document referred to follows:)
Know all men by these presents, that Local 542, International Union of Operat-
ing Engineers, shall hereby remise, release, and forever discharge Henry Acchione,
James J. Corbett, Edward Piscatelli, Michael F. Mogan, Martin McHale, Otto
Weidman, Maurice Rudden, Joseph Devlin, Daniel Gardner, Alex Capaldi, and
William Rodney, their heirs, executors, and administrators, of and from all,
and all manner of, actions and causes of action, suits, debts, dues, accounts, bonds,
covenants, contracts, agreements, judgments, claims, and demands whatsoever in
law or equity, especially all claims set forth in a bill of equity brought in the
Court of Common Pleas No. 2 for the county of Philadelphia, December term,
1946, No. 3187, in equity, which against the said Henry Acchione, James J. Corbett,
Edward Piscatelli, Michael F. Mogan, Martin McHale, Otto Weidman, Maurice
Rudden, Joseph Devlin, Daniel Gardner, Alex Capaldi, and William Rodney, the
said Local 542, International Union of Operating Engineers ever had, now has,
or hereafter can, shall or may have, for, or by reason of any cause, matter or
thing whatsoever, from the beginning of the world to the date of these presents.
In witness whereof, local 542 has caused this release to be executed by its duly
authorized president this 22d day of October 1948.
Local 542,
[seal] By .
Signed, sealed, and delivered in the presence of :
The Chairman. What is the difference between the two of them?
Why was it necessary to execute two documents?
Mr. Underwood. I do not know that I can explain that fully, sir.
This probably was some legal reason at the time, or at least I was so
advised at that time. These are all of the officers, or those purported
to be oflicers of the local union, who had been appointed by the inter-
national union, by Joseph Fay, or Mr. Maloney, and they were acting as
the executive board of the union, I understand.
The Chairman. The first one I presented to you, what is the differ-
ence between whom it releases and whom this one releases?
Mr. Underwood. The first one releases all of the international
officers.
The Chairman. The first one I presented to you releases the inter-
national officers. The one you now have in your hand released the local
officers.
Mr. Underwood. That is correct, sir.
The Chairman. In other words, everything was washed out. You
could not go back behind that, even back to the beginning of the world,
I believe it said somewhere, from the beginning of the world up to that
date, you could not go back and check up on how they spent the money
or any action they had taken, either of local officials or of international
officials?
Mr. Underwood. That is correct, sir.
The Chairman. Senator Mundt?
Senator Mttndt. Maybe you can tell me why as I am glancing
through, but does the second document specifically mention Mr. Fay
as among those being released from all responsibility ?
Mr. Underwood. I believe not, sir.
Senator Mundt. The first one does not, either.
Mr. Undfj^wood. The first one does not?
7936 IMPROiPElR ACTIVITIES IN THE LABOR FIELD
Senator Mundt. I do not believe so. Fay's name does not appear
in either document. Maloney's appears in the second one, and Henry
Acchione, James J. Corbett, Edward Piscatelli, Michael F. Hogan,
Martin McHale, Otto Weldman, Maurice Rudden, Joseph Devlin,
Danile Gardner, Alex Capaldi, and William Rodney.
I do not see mention of Fay in either one. I was wondering why not.
The Chairman. Joe Fay was in the penitentiary at that time.
Mr. Underwood. I am afraid I cannot explain the omission, because
he certainly was in the bill of complaint filed in the case, unless there
was no agreement to release Joseph Fay. It seems to me now — I seem
to recall some discussion that our lawyer said he did not agree to the
release of one person, and it might have been Fay.
Senator Mundt. In all events, Fay's name does not appear in this
document. It says they shall all be released and there it mentions
presumably all of the international officers, and these you tell me are
the local officers, all of whom, from the beginning of the world to the
date of these presents, are released from all wrongdoing, or skuldug-
gery of any kind.
Now^, I w^as wondering if you could throw any light on the reason
why Fay's name was not included among those getting that release.
Mr. Underwood. I cannot at this moment.
Senator Mundt. Was he in prison at the time that this was issued,
which was signed, sealed, and delivered in the presence of witnesses,
the 22d day of October 1948 ?
. Mr. Underwood. Well, he undoubtedly was in prison at that time.
Senator Mundt. Well, it could be that perhaps because he was in
prison, that they released him, although I see no reason, even so, that
these people associated with him would not have included him in the
release, because presumably they could take action against his heirs,
and against his estate, or against him after he got out of the peni-
tentiary.
In all events, in answer to my previous question, it appears clear
from these two stipulations that they insisted that the union not only
release Mr. MacDonald from all responsibility for his sliort period
of supervision, but they release the international union officials and
the local union officials of all responsibility throughout the entire
period of the supervisory status, including that under Mr. Fay.
Mr. Underwood. That is correct.
Senator Curtis. Where are the books and records now relating to
this period ? Do you know ?
Mr. Underavood. No, sir ; they were not in the union when we went
in in 1948. In fact, the office was a shambles when we went in there,
with just a couple of paper cartons with a few papers that had been
thrown into these paper cartons, and we were not able to learn where
the records had gone or wliere they could be located.
Senator Curtis. Was there ever any estimate made as to the total
amount of money that these international officers and trustees or
supervisors had handled for the local during the period in question ?
Mr. Underwood. Only the most rough estimates, in the absence of
any records. Of course, it was difficult for us to determine, but we
only knew that anywhere from 1,500 to 3,000 men were on permits,
who were not permitted to join the union but were required to pay
$2.50 a week while they were working, during the 1940's.
IMPROPER ACTIVITIES IN THE LABOR FIELD 7937
In addition to that, all of the kickbacks as we determined them,
the assessments of 5 percent on wages, and then 3 percent, and the
interunion assessments levied against members of the iDranches,
amounted, we thought, to a tremendous sum of money. However,
there was no way for us to determine that.
Senator Curtis. Did you have a rough estimate of how much it
might have amounted to ?
Mr. Underwood. Of course, we alleged at that time it was hundreds
and hundreds of thousands. I think it was millions of dollars ac-
tually. I think somebody estimated that 3 or 4 million dollars had
been put in the pockets of someone, and never been accounted for.
Senator Curtis. And you had no assets turned over to you other
than cash, such as buildings or bonds or anything of that sort, when
you took control of the union back ?
Mr. Underwood. No, there was one bond, and no buildings, of
course. Tliere was one bond, I believe, at that time in a safe deposit
box, and a very small amount of cash.
Senator Mundt. How much were the net assets of the union at the
time that you took over ?
Mr. Underwood. Tlie net assets were estimated at that time to be
about $62,000.
Senator Mundt. $62,000 ?
Mr. Underwood. They had a number of Cadillac automobiles which
increased the net worth considerably.
Senator Mundt. This was all that remained of the millions of dol-
lars that had passed through the union coffers in the preceding period
of supervisory control ?
Mr. Underwood. Yes, sir.
Senator Mundt. You can make a pretty good estimate of what a
legitimate annual expenditure of your union must have been during
that time, on the basis of tlie experience that you have had since you
have been in control. Wliat would you say during that period would
have been a rough guess at the honest annual outgo that the union
should have paid during that period of expenses ?
Mr. Underwood. Of course, a number of changes were made after
we went in. We got additional quarters, larger quarters, and the
membership increased and services were provided for the membership,
which increased the costs somewhat to us, and where no services of
that kind were performed before.
Senator Mundt. Make your estimate on the basis of conditions as
they were, at the time Mr. Fay was in charge.
JNIr. Underwood. I think perhaps $12,000 — I am trying to get some
figures in my head now — probably $100,000 a year at the very outside.
It would be less than that because I am basing that on what our costs
were. That is the hiring of the agents.
Senior Mundt. Give a rough guess of what would be the net income
of the union at that period, what the income, or gross income of the
union would be at that ])eriod.
Mr. Underwood. Well, I would say
Senator Mundt. That would be merely speculative because you have
some permittees and you have some members, but could you give us
some idea ?
Mr. Underwood. The permittees varied a great deal, of course, and
with these assessments and international union assessments and all of
7938 IMPROPEiR ACTIVITIES. IN THE LABOR FIELD
the union dues, I just haven't attempted to try to formulate any total.
I would like to sit down and do that, sir, because I have got to reflect
on it. There were some assessments coming in there at the time.
The Chairman. The witness may do that, if you have questions in
mind that Senator Mundt asked you, and the information he wants.
Wlien you conclude here, you may make a calculation, and submit it in
writing under oath, and it may go in-the record at this point.
(The information appears on p. 8071.)
Senator Ervin. If I may interject myself at this point, as I under-
stand, you say that they were collecting $2.50 per week out of about
1,500 men ?
Mr. Underwood. No; there were 1,500 to 3,000 men who were not
members of the union, but working on permits, who pay $2.50 a week
for working.
Senator ERV^N. And then they got an additional 5 percent of all
of tlie earnings of both those who were members and those who were
working under permits ?
Mr. Underwood. Yes, sir.
Senator Ervin. And in addition to that, the membere paid dues,
did they not ?
Mr. Underwood. Yes, sir.
Senator Ervin. What were the members' dues?
Mr. Underwood. The dues at that time were $3.50 a month.
Senator Erven. How many members did the union have at that
time, the local ?
Mr. Underwood. At that time they had about 2,200 membei-s, ex-
cluding, of course, the permittees.
Senator Erven. That is all.
Senator Mundt. Was that $3.50 you mentioned a weekly dues or
monthly dues?
Mr, Underwood. Monthly dues.
Senator Mundt. A pennittee had to pay $10 a month to work, and
the union member paid $3.50 dues for his part?
Mr. Underwood. Yes, sir.
Senator Mundt. And the permittee and the union member both
paid the same 5 percent, as I understand it.
Mr. Underwood. Yes, sir.
Senator Mundt. I am just ti-ying to figure out the difference that
it took out of the household budget of a permittee as against a union
member. It is a little less tlian three times the cost. He did not pay
an initiation fee, a permittee?
Mr. Underwood. No.
Senator Mundt, Or entrance fees ?
Mr. Underwood. No.
Senator IVIundt. Or fee to get started with, any fee to become a
permittee ?
Mr. Underwood. No, sir. He went directly in.
Senator Mundt, Wliat was the purpose, and there may be some
perfectly legitimate reason or not, I do not know, Avhy you have some
union members working on a job, and some permittees working on a
job, be<!ause you said the permittee wanted to become a union member,
as I underst-ood you ?
Mr, Underwood, Yes, sir.
Senator Mundt. But he could not become one. Wliy not ?
IMPROPER ACTR'ITrES IN THE LABOR FIELD 7939
Mr. Underwood. I am sure I can't give you any legitimate purpose
for it. But I think the only reason for it, of course, was to get that
additional revenue from men on permit, and, by denying membership
in the union, that continued to come in.
Senator Mundt. As far as you know, there is no legitimate reason
for keeping a man on a permittee status, then ?
Mr. Undp:rwood. No, sir.
Senator Mundt. That is what I was trying to find out.
The Chairman. To go back to these releases, do I understand that
these releases were exacted by the international union and by Maloney,
the president of the international, and by the international officials —
these releases were exacted from your local ? You had to sign them ?
Mr. Underwood. Yes, sir.
The Chairman. In order to get an agreement to get out from under
trusteeship ?
Mr. Underwood. Yes, sir.
The Chairman. And you did not do it voluntarily, and you did not
do it because you wanted to ?
Mr. Underwood. No, sir.
The Chairman. The pressure came from the international to force
you to do it in order to get out from under receivership or trusteeship
so that you could get a little control of the union back in the hands of
the men who did the work ?
Mr. Underwood. Yes, sir ; that is correct.
The Chairman. That is correct ?
Mr. Underwood. Yes, sir.
The Chairman. I have not examined it closely and I do not know
whether they purport to release the officers from any possible prose-
cution for theft. If so, in my judgment, they are illegal documents.
That is against public policy, and I think insofar as they undertake
to do that, they are void.
As to civil liability, unless a proper consideration was given, I do
not know what the consideration was other than that, that would not
be a valid consideration, in my judgment, for such a release.
As to a release that you would not pursue just claims in order to
get your union back, in my judgment, it would be very questionable.
But anyway, whatever it was, whether against public policy or whether
it is illegal or what, you had to do that at that time, according to your
best judgment and the advice of your counsel — you had to do that to
get your union out of trusteeship ?
Mr. Underwood. Yes, sir ; that is right.
Senator Mundt. I would like to ask Mr. Underwood what it was
that motivated these officials to insist on that release. Had there
been preliminary controversy about the fact that perhaps they had
gone south with some of your money, or were these men impelled by a
guilty conscience, and realized if you got control you might want to
look at the books and find something wrong ?
Mr. Underwood. I am quite sure they were very much concerned
about that, because in the allegations in the complaint filed against
them, we had specifically asked that they account for the moneys
taken in on permittees and these assessments, and named some of the
areas in which they had operated in this manner.
7940 IMPROPE'R ACTIVITIES IN THE LABOR FIELD
Senator Mundt. They had been warned that if something like this
did not interfere, they wonkl be asked to make an accounting?
Mr. Underwood. Yes, sir.
Senator Mundt. And realizing what they had done, they put that
up as a road block to stop such an accounting ?
Mr. Underwood. Yes, sir. That was absolutely a requirement, be-
cause the attorney representing us during the period we were discussing
this, in terms of a settlement, came out a couple of times and told us
that absolutely they will not agree to an election of officers unless we
agree to release them from any liability of this kind.
Senator Mundt. Was this document made a matter of public record
at the time, that is, through the press and so forth, or not ?
Mr. Underwood. I don't recall it ever being published in the press :
no, sir.
Senator Mundt. Because on its face, it sort of looks like a confession
of guilt on the part of these international officers, that they were going
to insist on this.
Mr. Underwood. We considered it so ; yes, sir.
The Chairman. I just wondered if you ever had an audit made of
such records as they turned over to you, or did they turn over any
records to you when you took the union back ?
Mr. Underwood. There were hardly enough records to have audits.
We did have an audit made, and about the only thing that disclosed
was how much money there was in the bank, and the bonds.
The Chairman. There was no record of receipts and vouchers and
cliecks, and so forth, showing how the money had been expended ?
Mr. Underwood. No, sir; we tried to get just where the money had
gone or a portion of it at least, and we found nothing to go on, sir.
Mr. Kennedy. Just on this assessment alone, I would think that
the members of the Operating Engineers were making probably more
than $5,000 a year during the 1930's? Do you believe that would be
accurate, on the average ?
Mr. Underwood. No, I do not believe they were. It was a bad
period for them ; yes, sir.
Mr. Kennedy. What would you say the average would be ?
Mr. Underwood. Probably the average would be about $3,000, or
possibly $3,500.
Mr. Kennedy. That would bring it up, based on the 5 percent, it
would still bring it up to about $350,000 a year, just on the 5 percent
assessment. Then, of course, you had the dues on top of that.
Mr. Underwood. Yes, sir ; plus the other assesments.
Mr. Kennedy. And there were the permittees, and so on ?
Mr. Underwood. Yes, sir.
The Chairman. They were getting close to $1 million a year out of
that union, were they not ?
Mr. Underwood. 1 think that is a fair statement.
Mr. Kennedy. Now, was there also a man who was involved in this,
in the union with the name of Piscatelli ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. What was his first name ?
Mr. Underwood. Edward Piscatelli.
Mr. Kennedy. Did he take an active role during this period of time?
INIr. Underwood. Yes, sir; very active. And he was an agent of
Joseph Fay during that period, busmess agent.
IMPROPER ACTIVITIES IN THE LABOR FIELD 7941
Mr. Kennedy. And operated directly under Joe Fay during this
period ?
Mr. Underwood. Yes, sir,
Mr. Kennedy. Now, you took over in 1948, and you were president,
and you remained president, with tlie individual members in control
of the union, until what time ?
Mr. Underwood. Until August of 1952.
JSIr. Kennedy. What happened then ?
Mr. Underwood. iVt that time Mr. Maloney sent in from New Jer-
sey, from Joe Fay's local, seven what we choose to characterize as
thugs, some of them armed, and took physical possession, and seized
control of the union offices, and after this was accomplished, they
handed me an order from Maloney stating that local was under
trusteeship or supervision.
Mr. Kennedy. So after 4 years of independence, you were put back
into trusteeship in 1952 ?
Mr. Underwood, Yes, sir.
Mr. Kennedy. Once again the trustees came out of Joey Fay's
local up in New Jersey ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Who was the one in charge of that group ?
Mr, Underwood, Well, the trustee himself didn't come out of Joe
Fay's local. However, all of those with him, who accompanied him
when they seized possession, came out of his local.
Mr. Kennedy", You say somebody came in or a number of them
came with guns, and can you give us the name of anybody who came
with a gun ?
Mr. Underwood. One I know, a fellow named Jack Smith, a former
pugilist I believe, and another one whom I didn't know was carrying
a gun, and displayed them.
Mv. Kennedy, During this period of time, the local called a strike
in Philadelphia, did it not ?
Mr. Underwood, Just prior.
Senator Mundt, Before we leave this taking over of the office, were
you in the office at the time they came ?
Mr, Underwood, No, sir ; 1 was not.
Do you want me to explain how this happened ?
Senator Mundt, Yes,
Mr, Underwood. There had been a strike in progress in the Phila-
delphia area voted by the membership, and an agreement had been
reached before the district court judge, that we would submit all issues
in this strike to arbitration. While we were in court we held a meet-
ing of the membership, a specially notified membership, and they
agreed to the arbitration and returned to work on the morning of
August 19.
While I was in court with our attorney reporting to the judge that
the members had accepted his recommendations and had returned to
work, these people moved in. These gunmen moved in and seized
control of the local office. When I returned from court, I found them
in possession.
Senator Mundt, Did you report that to the civil law enforcement
authorities of Philadelphia, that thugs with guns had taken over your
property ?
7942 IMPRO'PEIR ACTIVITIES IN THE LABOR FIELD
Mr. Underwood. Well, at that time it was a pretty confused situa-
tion.
The first thing I did, of course, was to call our attorney, and ask him
what move he could suggest under the circumstances. I believe at that
time he felt that it was futile to try to oppose them, physically at least ;
that we would have to see what could be done legally.
Senator Mundt. It would occur to me that up there in the city of
brotherly love there must be some kind of law protecting property
against thugs who come in with guns and I wondered why you did not
call up the policeman or some city attorney.
Mr. Underwood. Well, the first move I made was to a telephone, and
one of the men with guns stepped out in front of me, and pulled his
coat back, and told me to keep away from the telephone. So I had
to go outside and call our attorney. He then advised me to come over
to his office and discuss it and see what could be done.
Senator Mundt. But you never did report to the law-enforcement
officials that your property had been taken over by men at gunpoint ?
Mr. Underwood. No, sir ; we did not bring it to their attention, and
from our experience, we doubt very much whether any action would
have been taken.
Senator Mundt. 'Wliy do you say that ?
Mr. Underwood. An international union, before they take an action
of that kind, is pretty well situated in the area. They have contacted
certain people and they are well represented legally, and I think it
would be extremely difficult for 1 person or 2 or 3 people in the union
to bring any effective action against them, and prevent them from
carrying it out.
They have this order and it states, an order of supervision and trus-
teeship, and it states that they are to take full control of the local union
and it is their property, and all rights are suspended and all officers
suspended, and so forth.
Senator Mundt. You mean there is something in the international
constitution which sort of gives them a vested right to do a thing like
that?
Mr. Underwood. It gives them absolute right.
Wlien, in the opinion of the general president, he feels that it is nec-
essary, the constitution says he may come in and do all of these things
and take away all of your rights.
Senator Mundt. Is that not a weakness in the constitution some-
place '?
Mr. Underwood. I think it is a fatal weakness, and I think we will
never be able to correct a corrupt situation in unions as long as that
sword of Damocles is held over the head of local union officers and
members. I think it is the most American thing.
Senator Ervin. As a matter of fact, under the letter of the consti-
tution, the international officers take over the assets of the local union
when they declare a trusteeship and leave the officers and members of
the local without anything to fight for their rights with ; is that not so ?
Mr. Underwood. That is correct, sir.
The Chairman. May I inquire whether prior to their coming down
there and forcibly taking over the office and taking over the union,
that you had had any complaints from the international with respect
to your finances or anything being short ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 7943
Mr. Underwood. No, sir. There was never any complaint about
that, sir.
The Chairman. Did you have any notice or any warning at all that
such action was contemplated ?
Mr. Underwood. An order was issued by Mr. Maloney shortly
before this action was taken, ordering me as the president and busi-
ness manager, to order the men to return to work for certain con-
tractors without a contract, and on the basis of the proposals the
contractors had made.
The membership had voted for this stoppage of work, and all other
contractors in the area employing 75 percent of our membership
had agreed to new contracts and were working and paying the mem-
bership. However, Mr. Maloney insisted that we accept the proposals
which were far less than we were already receiving.
The Chairman, "Was that some of the favored contractors you have
been speaking of ?
Mr. Underwood. Yes, sir.
The Chairman. In other words, you had gone out and negotiated
with about 75 percent of the contractors and gotten wage agreements ;
is that correct ?
Mr. Underwood. That is correct, sir.
The Chairman. And he insisted that you settle with these favored
contractors for less than what you had negotiated the other contracts
for?
Mr. Underwood. That is correct.
The Chairman. And that the men return to work ?
Mr. Underwood. Yes, sir.
The Chairman. Do you think it was on the basis of the union's re-
fusal to do that, the local's refusal to do that, that he ordered you
placed in trusteeship ?
Mr. Underwood. Yes, sir ; that was the reason he gave, as a matter
of fact, because the strike was being carried on against these con-
tractors, and yet he placed the local under trusteeship after the men
had returned to work.
(Members of the select committee present at this point were Sen-
ators McClellan, Ervin, Mimdt, and Curtis.)
The Chairman. That was for 25 percent of those contracts. In the
meantime, by the time he got his men down there to forcibly take over
and take possession and deliver you the order, the men had returned
to work with an agreement that their differences were to be arbitrated
and, at the time it happened, you were in court with your attorney for
the local, making a report of such action to the court. Is that cor-
rect?
Mr. Underwood. That is correct ; yes, sir.
Senator Mundt. In short, what happened, as I understand it, is
that you were booted out by Mr. Maloney at gunpoint, because you
were conforming with the desires of your union members instead of
recognizing the demands of the international bosses to do something
which the men themselves do not want you to do ?
Mr. Underwood. That is exactly right, sir.
Senator Curtis. Do you have an estimate as to what the net worth
of the local was at the time they took it over at gunpoint ?
7944 IMPRO'PEK ACTIVITIES IN THE LABOR FIELD
Mr. Underwood. At that time, there was about $75,000 in bonds
and cash. However, there was due the union quite a sum of money,
about $70,000 or $75,000, which had been taken from the treasury
to supplement the income of those men who had been on strike. There-
fore, that was coming in, and did come in after they took over.
That was to replenish the treasury, of course, for this money that
had been spent. There was at that time about $120,000 in a death-
benefit fund, set up by the local and administered by the local for its
membership. There was also about $700,000 in the welfare fmid and,
of course, they took control of that, also, when they came in.
Senator Curtis. In other words, when you took it over, you had
about $62,000 in assets, held the 4 years, and, when they seized it, it
would be something over $900,000, counting the welfare fund ?
Mr. Underwood. That is correct, sir, in addition to which there was
property, of course, that increased its worth even above that.
Senator Curtis. Some real estate ?
Mr. Underwood. Not real estate, but the officers — of course, the new
offices were taken and modern equipment was installed in the offices.
The personnel were enlarged and a number of improvements were
made.
Senator Curtis. And you had done all of this without the 5-percent
assessment ?
Mr. Underwood. Yes, sir.
Senator Curtis. And the other dues remained the same ?
Mr. Underwood. The other dues were raised in 1947, while it was
still under supervision. They were not raised at any time after we
went into office in 1948.
Senator Curtis. How about the permittees ?
Mr. Underwood. The permittees, during the 1948-52 period ?
Senator Curtis. Yes.
Mr. Underwood. There were very, very few permittees, and those
are the ones who are required to pay this permit under the constitution
when they have made application for membership in the union, or if
they are members of another union of the Operating Engineers who are
working in your territory. A union is required to charge them $2.50
a week and, also, while they are on application for membership in the
union until such time as the application is approved. But there
were very few.
Senator Curtis. Of course, the welfare fund was built up by pay-
ments from employers and not by dues ; is that correct ?
Mr. Underwood. That is correct, sir ; yes.
(At this point. Senator Kennedy entered the hearing room.)
Senator Curtis. So, even exclusive of that, you had increased the net
worth of the union 4 or 5 times without the 5-percent assessment;
had you not ?
Mr. Underwood. I would say so, sir ; yes, sir.
Senator Mundt. This $700,000 welfare fund which you had at the
time they took it away from you by gunpoint ; was there no such thing
as a welfare fund at the time you went in ? You said there was only
$62,000 in assets. Did you forget, perhaps, that at that time they
had a welfare fund, too, or was there any welfare fund ?
Mr. Underwood. No, sir ; there was no welfare fund.
Senator Mundt. You built that whole thing up in 4 years ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 7945
Mr. Underwood. That was established, sir, in 1950, after we got
back our local autonomy.
(At this point, Senator McNamara entered the hearing room.)
Senator Mundt. That is all, Mr. Chairman.
The Chairman. All right, Mr. Kennedy.
Mr. Kennedy. You were talking about favoritism to contractors.
Did you ever have a telephone conversation or talk to Mr. William A.
Maloney about the S. A. Healy Co. ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Mr. Chairman, the S. A. Healy Co. is one of the
largest contracting companies in the country, and will be the subject
of further testimony before this committee during the week. It is a
very important matter to us. We will go into it when we get into the
Chicago phase, and, also, William Maloney, personally.
I would like to find out from this witness as to what he knows about
the S. A. Healy Co.'s operations in the Philadelphia area, and what
conversations he had with Mr. Maloney about that company.
Mr. Underwood. The S. A. Healy Co. had a large project. Blue
Ridge Summit, a Government project, and we immediately began
having difficulty with the company, attempting to induce them to com-
ply with the area agreements, collective-bargaining agreements, so
the agent in the area, Mr. Britville, was sent up there on a number of
occasions to talk to the superintendent in charge.
He seemed to make no progress, so I contacted Mr. Healy and told
him what the situation was; that it could not be tolerated; that he
would have to comply with the area agreements, as other employers
were doing. He tolcl me I better talk to Bill Maloney before I in-
sisted on anything. I told him I did not think it was necessary to do
that. I said, "You have got to comply with the agreements." He
also had refused to contribute into the welfare fund.
The Chairman. Let us see. You had a contract with him ?
Mr. Underwood. We had a contract covering that area, sir. He
came in, working under that contract. However, he, himself, would
not sign a contract.
The Chairman. But you had an area contract ?
Mr. Underwood. Yes, sir.
The Chairman. Did the Operating Engineers have other contracts
with him, or did they ever have him under contract?
Mr. Underwood. I doubt if they ever had. I never heard of them
having him under contract.
The Chairman. In other words, he was a free-lance fellow, so far
as observing the collective bargaining and other requirements of
organized labor?
Mr. Underwood. So far as I could understand ; yes.
The Chairman. All he had to do was to make his arrangements
witli Maloney ; is that what you are saying?
Mr. Underwood. Yes, sir.
The Chairman. All right, go into more detail, Mr. Counsel.
Mr. Kennedy. Did Mr. Maloney speak to you about giving him
some preferred treatment, not to bother him ?
Mr. Underwood. Yes ; Mr. Maloney called me at our local union
office in Philadelphia and he was very incensed over the fact that our
agent up in the area had insisted that S. A. Healy Co. comply with
7946 IMPROPER ACTIVITIES IN THE LABOR FIELD
the terms of the existing collective bargaining agreement and told
me to keep that agent away from him and to leave him alone.
I said, "Why should he be treated any differently than any other-
employer in the area and he said, "Because he is a friend of mine and
that is all I should have to tell you. Keep away from him and leave*
him alone." I said, "I am sorry Mr. Maloney, but we cannot do that..
We can't have one operating one way and another the other way..
The contract must be enforced."
He called me on another occasion when I told Mr. Healy it would
be necessary to take the men off the job unless he complied with the-
agreement. He called me again and told me not to disturb that job.
It went on, I guess for about 3 or 4 weeks and I tried to induce Mr.
Healy to go along with the contract, rather than to have an altercation
with the general president.
He refused to do it and we removed the men from the job. They
were off the job, I believe, only 4 or 5 hours when he agreed to go
along. But in the meantime, Mr. McDonald, who was the interna-
tional vice president and a deputy of Mr. Maloney, who was assigned
to that area, who was in the area, that area at the time, of local 542,
told me that Mr. Maloney had called liim and insisted that I go over tO)
New York, to the Hotel New Yorker and meet with Mr. Healy about
the difficulties we were having with him on his job.
At that time I did go over there. I met with him and Mr. Healy
said that he was not going to pay into the welfare fund. I told him
that the job would have to be stopped unless he did comply. I went
back again to Philadelphia after that conversation and instructed the
agent that unless we had a check covering the payments due the wel-
fare fund from Mr. Healy — I believe it was by 3 or 4 days later — we
would have to stop the job, and we did.
I informed Mr. Healy of that fact and we did get the check from
him. I believe it amounted to ten or twelve thousand dollars.
Mr. Kennedy. What year was this ?
Mr. Underwood. That was in 1951.
Mr. I^NNEDY. Were you familiar with the fact that Mr, Healy was
subpenaed before the grand jury regarding the Joey Fay matter back
in 1940 or so?
Mr. Underwood. I read of it ; yes.
Mr. Kennedy. And after he testified before the grand jury, he fled
the jurisdiction and refused to come back in and testify at the trial of
Joey Fay ?
Mr. Underwood. So it was reported.
Mr. Kennedy." And Mr. Hogan was unable to get him back as well
as a number of other contractors, to come back and testify about Joev
Fay?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And after Joey Fay had been convicted, he came
back and testified at that time that he had paid $125,000 to a man by
the name of Michael Carrozza, of the Hod Carriers ?
Mr. Underwood. Yes, sir; I read these accounts.
Mr. Kennedy. But by that time, Michael Carrozza died and there
was nothing that could be done about it; is that right?
Mr. Underwood. Yes, sir.
IMPROPER ACTIVITIES DC THE LABOR FIELD 7947
Mr. Kennedy. And he is still operating and is one of the biggest
contractors in the country ; is he not ?
Mr, Underwood. Yes, sir.
Mr. IvENNEDY. Do jou know if he has any financial arrangements
with Mr. William E. Maloney at the present time or has had any fi-
nancial arrangements ?
Mr. Underwood. Only what I have read. I read where there was
an arrangement to buy the hotel in Chicago.
Mr. Ivennedy. But you know nothing about it from your own
knowledge ?
Mr. Underwood. Of my own knowledge, I do not ; no, sir.
Mr. Ivennedy. Coming to 1952, you were removed from the union
and you were personally tried yourself by the international union ; is
that right?
Mr. Underwood. Yes, sir.
Mr. Kennedy. Wliat were the charges and what sentence did you
receive? This is by the international itself; is that right?
Mr. Underwood. Yes, sir. The charges were circulating defama-
tory literature, which was the bill of complaint filed in a suit in
court.
Mr. Kennedy. You were suing the international to regain your
independence at that time?
Mr. Underwood. That was a petition for injunction to restrain them
from taking the local over because the members had voted not to ac-
cept the contract proposals. And disobeying the orders of the gen-
eral president. I was suspended for 6 years and fined $3,500.
The Chairman. What was your offiense. What did you do wrong?
Mr. Underwood. Not obeying the general president regardless of
what the orders were. The membership voted on every move that
was made in that local union.
Senator CmtTis. Had you obeyed tlie general president, do you
think you would have been fair to the workers that you represented
in that local ?
Mr. Underwood. No, sir ; I certainly would not have been.
Senator Curtis. In other words, you felt it was your duty to protect
their assets and their oontractual rights?
Mr. Underwood. Yes, sir ; I did.
Senator Mundt. Did you pay the $3,500 fine ?
Mr. Underwood. No ; I did not.
Senator Mundt. Did they take any legal action to get it?
Mr. Underwood. They did not take legal action ; no, sir.
Senator Mundt. "Wliat they wanted to do was to get you out of
there, primarily ?
Mr. Underwood. Yes ; that seemed to be the principal objective.
Senator Mundt. We had a witness here last week who was tried in
one of Mr. Maloney's courts and he called it a kangaroo court. He
said the legal proceeding was not very proper, that a man being tried
did not have a very good chance to present his case and had no oppor-
tunity to get justice.
Would you say that was a fair characterization of a Maloney court?
Mr. Underwood. I think this was a very generous characterization.
Senator Mundt. You say he was generous to call it a kangaroo
court and was slanderous to a kangaroo?
7948 IMPRO'PEIK ACTIVITIES IN THE LABOR FIELD
Mr. Underwood. Well, I might say here this is still in litigation
and we are getting close to the issues that have been raised in the
litigation and it is pending now in the United States Circuit Court
in Philadelphia.
Senator Mundt. We have no desire to get into that area.
The Chairman. Senator Kennedy ?
Senator Kennedy. One of the problems which has disturbed this
committee has been this business of trusteeship and the inability of
many of tlie members of these locals which are in trusteeship to get
out of trusteeship.
When your local was put into trusteeship, was a bill of particulars
given to the local as to why trusteeship was exerted by the parent
union ?
Mr. Underwood. No, sir, it was not.
Senator Kennedy. Your local merely received a letter ? How did
they receive the message ?
Mr. Underwood. It was handed to me after the local had been
seized, after physical possession had been taken of the local union
offices.
Senator Kjennedy. I do not want you to answer anything you do
not want to answer, but how was it taken over? By what means?
Did you receive a registered letter, a telegram, or did some people
just walk in one day, or what ?
Mr. Underwood. It was handed to me personally, a letter was
handed to me personally.
Senator Kennedy. Saying that the local was now in trusteeship?
Mr. Underwood. Yes, sir.
Senator Kennedy. Was a bill of particulars given to you ?
Mr. Underwood. No, sir.
Senator Kennedy. What did you then do ?
Mr. Underwood. Then, of course, I consulted with the attorney
for the union and he advised bringing an action against the union.
Of course, that was after I was tried. I was tried by the union after
it was put under trusteeship. I was notified to appear for trial in
New York before the general executive board of the international
union.
Senator Kennedy. As I understand the matter of litigation it is for
the years 1948 to 1952. Is that correct ?
Mr. Kennedy. You were in trusteeship from about 1935 or 1934
up until 1948 ; out of trusteeship and independent from 1948 to 1952 ;
and back in trusteeship from 1952 up until the present time.
Mr. Underwood. That is right.
Senator Ivennedy. You are familiar with the periods in which you
went into trusteeship and came out of trusteeship. Can you tell me,
at the time it was in trusteeship, whether bills of particulars as to
what the local had done wrong were presented to you or to the mem-
bers, whether tlie union gave you any standards which you must meet
in order to get out of trusteeship, whether any time limit was ]:)Ut
forth, and whether it was possible for you, by' your constitution, to
appeal to your executive board to take you out of trusteeship?
^Aliat I am trying to find out is what rights the local liad as opposed
to the international as far as removing themselves from trusteeship.
IMPROPER ACTIVITIES IN THE LABOR FIELD 7949
Mr. Underwood. Nothing of that kind was done. It was our clear
understanding from the constitution itself that we had no rights what-
soever, while it was under trusteeship.
Senator Kennedy. In other words, you could be put in whenever
the president or the executive board
Mr. Underwood. The president.
Senator Kennedy. Whenever the president determined that you
should be, and you could not get out of it until they determined so,
and there were no steps that you could take, or standards whicli you
must meet, before you would be taken out of trusteeship, is that
correct ?
Mr. Underwood. That is correct.
Senator Kennedy. In other words, whenever the president decided
that he did not like the way the head of the local was conducting the
affairs, or if he was conducting them in a way which did not suit the
president, he could put you in trusteeship, keep you there indefinitely,
and there was nothing that you could do about it 'I
Mr. Underwood. That is right, sir.
Senator Kennedy. From your experience in the union movement, do
you think that is completely unsatisfactory ?
Mr. Underwood. I think it is completely insidious in the union
movement. I do not see how any local can clean up anything in their
unions as long as they have this trusteeship.
Senator Kennedy. Hanging over you as a course of action, in those
cases when you do not do what the president desires you to do, that is
a tremendous club with which to whip a local into line, is that correct?
^Ir. Underwood. Yes, sir, that is right.
Senator Kennedy. Don't you feel that it would be desirable to liave
some legislation, or other means — and there may be an occasion when
it is proper that there should be trusteeship, if funds are misappro-
priated— or at least with certain procedures set up by law, perhaps,
which would permit the local that met the standards of suitable be-
havior to take themselves out of trusteeship and once again administer
their own affairs ?
Mr. Underwood. I think it is very desirable.
Senator Kennedy. Thank you.
Senator Ervin. Mr. Chairman, I v\-ould like to ask a question.
The Chairman. Senator Ervin.
Senator Ervin. As I understand you, you Avere tried before the
international and fined $3,500, and suspended from membership in
the union for 6 years because you liad gone into a court of law and
asked what you conceived to be justice for the members of the local
union?
Mr. Underwood. That is right, sir.
Senator Ervin. And they did that before there was any opportunity
to have the case tried in the court of law to determine whether your
allegations were true or not ?
Mr. Underwood. That is right, sir.
Senator McNamara. Mr. Chairman?
The Chairman. Senator McNamara ?
Senator McNamara. I would like to ask this question of the wit-
ness: Did you request at any time that the trusteeship be lifted?
Mr. Underwood. During "what period, sir? Prior to 1948?
21213— 58— pt. 20 3
7950 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator McNamara. Well, I made it very general. I said at any
time.
Mr. Underwood. Yes, sir.
Senator McNamara. Do we have any evidence that you made the
request ?
Mr. Underwood. Well, we have a number of witnesses
Senator McNamara. You didn't put it into writing.
Mr. Underwood. No, sir.
Senator McNamara. You don't have any copies of requests ?
Mr. Underwood. No, sir. We were under the trusteeship of Joe
Fay, and he was an international vice president, and he was appointed
by the general president, sir.
Senator McNamara. Did you or the court feel that you had ex-
hausted all of your remedies within the international setup?
Mr. Underwood. I don't know whether the court ever ruled on that
question, sir.
Senator McNamara. No, I mean did you feel that you had ex-
hausted all of your remedies before you went to court?
Mr. Underwood. Yes, sir.
Senator McNamara. That is all, sir.
Mr. Underwood. That is, all reasonable remedies. It reminds me
that when you try to exhaust your remedies, the remedies exhaust
the member, before he can get any relief.
Senator McNamara. Yes, but you get into this detail. Do not your
bylaws request or require you to exhaust your remedies within the
union movement before you go into court ?
Your charter was issued somewhat on this basis, was it not ?
Mr. Underwood. The constitution, sir, forbids any member or offi-
cer of a local union from going into a court of law for any reason
whatsover until they have exhausted the remedies which requires
them to wait until the next convention of the union, which may be
4 years hence after this difficulty.
Senator McNamara. Your charter was issued on that basis ?
Mr. Underwood. Yes, sir.
Senator McNamara. That is all.
The Chairman. All right, Mr. Counsel.
Mr. Kennedy. I believe you were not allowed to attend meetings
after the international took over ?
Mr. Underwood. No, sir, I was not.
Mr. Kennedy. So he is not familiar, except by hearsay, as to what
transpired after 1952. I would like to call another witness at this
time.
The Chairman. All right.
In the meantime, will you make the calculations the best you can
in response to Senator Mundt's request and be prepared to submit
them?
Mr. Underwood. Yes, sir.
The Chairman. You may stand aside for the present. You will
probably be recalled. Call the next witness.
Mr. Kennedy. Mr, Homer Dawson.
(At this point the following members were present: Senators Mc-
Clellan, Ervin, McNamara, Kennedy, Mundt and Curtis.)
IMPROPER ACTIVITIES IX THE LABOR FIELD 7951
The Chairman. You will be sworn, Mr. DaA\^on. Do you solemnly
swear that the evidence you shall give before this Senate select com-
mittee shall be the truth, the whole truth, and nothing but the truth,
so help you God ^
Mr. Dawson, I do,
TESTIMONY OF HOMER G. DAWSON
The Chairman. State your name, your place of residence and busi-
ness or occupation.
Mr. Dawson. Homer G. Dawson, 1500 Seaton Drive, Wilmington,
3, Del. I am an operating engineer.
The Chairman. Do you waive the right to counsel ?
Mr. Dawson. I do, sir.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. You have been in local 542 for hoAV long?
Mr. Dawson. Since 1941.
Mr. Kennedy. And you were a business agent for the local ?
Mr. Dawson. Yes, sir
^Ir. Kennedy. When ?
Mr. Dawson. That was in 1952.
Mr. Kennedy, And you remained as a business agent for how long?
Mr. Daw^son. Six months.
Mr. Kennedy. Six months ?
Mr. Dawson. Yes, sir.
Mr. Kennedy. You were in there Avhen the international union came
in and took this local over in trusteeship ?
Mr. Dawson. Yes, sir, I was.
Mr. Kennedy. And you quit as a business agent shortly afterward ?
Mr. Dawson. Yes, sir.
Mr. Kennedy'. Would you tell the committee briefly what were the
reasons that you quit as a business agent ?
Mr. Dawson. Well, there were several reasons why I quit. When
the international came in and took over, innnediately when an argu-
ment or discussion would come up on a job, the contractor would call
the union office or the supervisor, and although I didn't have this
happen to me personally I was in the office several times when the
other agents had difficulties, and in most instances the supervisor was
going along with the contractors.
There was another of these individual coiitracts, with independent
contractors, whom we liad been signing up in 1952, Avhen w^e were
having this trouble witli the association, and many of them had made
the request that tlieir names not be revealed so that there wouldn't
be any reprisals taken against them.
I walked in the office one day and saw the attorney and the secre-
tary for the contractors' association going over all of these contracts,
copying names from them.
Mr. Kennedy'. So that we can understand, some independent con-
tractors had signed Avith the union ?
Mr. Dawson. That is correct.
M]-. Kennjldy. The dispute at that time was with the contractors'
association ; is that right ?
Mr. Daavson. That is correct.
7952 IMPRO'PEIR ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. And some of the members of the contractors' asso-
ciation had broken away and signed up with the union, but they did
not want their names known ; is that right ?
Mr. Dawson. Those, and other individual contractors.
Mr. Kennedy. And they did not want their names known to the
contractors' association ?
Mr. Dawson, That is correct.
Mr. Kennedy. You had given them your word that their names
would not be known, and yet one day in the union hall you saw this
list being turned over to the representatives of the contractors' asso-
ciation ; is that right ?
Mr. Dawson. That is correct.
Mr. Kennedy. So that was one reason that you had a dispute with
the union leadership. Did you also have a dispute because of the
fact that you felt certain contractors were receiving favors from the
union ?
Mr. Dawson. May I say that I did not personally have any such
difficulties, but one of the other agents, which I was a witness to, was
having some trouble and the supervisor seemed to be taking the con-
tractor's part in the argument. I agreed wholeheartedly with the
business agent in the argument, although I did not enter into it. One
of the other and perhaps the principal reason was that there is a pro-
vision in the constitution whereby when a local is under supervision,
if 25 percent of the membership of the union will sign and send in a
statement the general office is then supposed to have a referendum
vote to find out the wishes of the membership.
We had petitions printed and were circulating at the time to get 25
percent of the membership to send in so that the international office
would have to take a vote and see what the members desired.
Mr. Wharton, the supervisor, said that under no circumstances
should any of his agents be out circulating these petitions.
That, along witli the otlier things, was enough for me, and so I quit.
Mr. Kennedy. That is W-h-a-r-t-o-n ; he was a supervisor ?
Mr. Dawson. Hunter P. Wharton.
Mr. Kennedy. Did you find out then or later on that there were
sweetheart contracts made with certain contractors up there as far as
not making them pay the prevailing rate or wage scale?
Mr. Dawson. We had a great deal of difficulty finding out wliat the
contracts were. We didn't liave any vote or voice on these contracts.
We had heard that there were other contracts in existence in addition
to those that we thought we knew about.
Mr. Kennedy. Secret contracts ?
Mr. Dawson. Well, we certainly couldn't find out about them, and
T would call them secret.
Mr. Kennedy. So there was one contract that was supposed to exist
between the union and the contractors, and then you found that there
was a supplementary contract that existed between some of these con-
tractors that allowed them to pay less than the wage in tlie master
contract.
Mr. Dawson. Yes, sir, we had heard that and tried to find out on
the floor, but we wei-e not successful.
Mr. Kennedy. Did you find tliat some of the employees for these
favored contractors were getting paid less than some of the employees
on the other jobs ?
IMPROPER ACTIVrriES IN THE LABOR FIELD 7953
Mr. Dawson. I know of one instance where a man was sent out on
a union job, by the union business agent, and when he received his pay
he was getting $1 an hour less than what we thought the scale to be.
The Chairman. One dollar an hour, or one dollar a day ?
Mr. Dawson. One dollar an hour, sir.
Mr. Kennedy. Did you find that existed among some of these
favored contractors, that they were paying their employees $1 less an
hour for the same work with the concurrence of the union officials,
during the period of trusteeship after 1952 ?
Mr. Dawson. I have only the one instance and there were two men
at that time of whom I personally know of, although I understand
that it was quite prevalent in other areas.
Mr. Kennedy. I want to ask you in addition to those problems that
you have already discussed, did you find that you couldn't vote for
any of your union officials during this period of time ? ^
Mr. Dawson. We have not had an election of officers since 1950.
Mr. Kennedy. What about the resolutions from the floor? Could
any members, any rank and file members, offer resolutions from the
floor?
Mr. Dawson. There were resolutions offered, usually they wouldn't
be accepted. We had no vote on the contracts, on acceptance or rejec-
tion of a contract. We did not have election of officers. We had
no voice in running the local union itself.
Mr. Kennedy. Were there very few meetings of the local or the
board during this period ?
Mr. Dawson. Well, there were for the period 1952 when they came
in and took over, I think there were two meetings shortly after they
took over, and then there was a period of nearly 2 years when there
were no meetings whatsoever.
The Chairman. A period of 2 years and no meeting of the local ?
Mr. Dawson. Yes, sir.
Mr. Kennedy. Did you have any members, representatives on the
negotiating board that were negotiating the contract ?
Mr. Dawson. No, sir, there were no members. Some of the business
agents appointed by the international, they said they were the
negotiators.
Mr. Kennedy. You had absolutely no rights and no control over
any of your affairs ?
Mr. Dawson. None whatsoever.
Mr. Kennedy. Over your election of your officers or your finances ;
is that right?
Mr. Dawson. That is right.
Mr. Kennedy. Was there also a so-called goon squad that was oper-
ating in the local ?
Mr. Dawson. There was a group that would usually get along one
side of the meeting hall, and naturally, although we had no voice in the
local union, we did ask questions and try to get answers. And when-
ever any of the questions were embarrassing to the people presiding at
the meeting, as we call them, the goon squad would start shouting and
holler "Sit down and shut up," and just generally make a lot of noise
so that in most cases the president would say, "Well, you can see the
members don't want to hear you, and so sit down."
Mr. Kennedy. Did they ever threaten any of the individuals who
were trying to hajve any of these rates restored to them ?
7954 IMPRO'PEIR ACTIVITIES IX THE LABOR FIELD
Mr. Dawson. General threats, and shouted from the sidelines.
Mr. Kennedy. Were any of tlie individuals beaten up at all during
this period of time, since 1952?
Mr. Dawson. Yes, sir ; there were several individuals beaten up.
Mr. Kennedy. Could you tell us some of those that were beaten up ?
Mr. Dawson. Well now, are you speaking of those that I person-
ally saw ?
Mr. Kennedy. Give us the names of some of those beaten up or you
were told were beaten up.
Mr. Dawson. Ted McCarty for one \yas beaten very badly in an
elevator. He was one. Another one which I witnessed was Howard
Gale, although I won't say he was beaten up badly, but the manner
that they assaulted him certainly had every indication it was their
intention.
Jimmy Russell, another member, was assaulted, I understand, but
I did not see it.
Another one was Johnny Tessell. He was assaulted.
Mr. Kennedy. These are four people all assaulted and this is since
1952, when the international came back in and took over the local?
Mr. Dawson. That is correct, sir.
Mr. Kennedy. These were individuals who were protesting against
the leadership and the conduct of affairs ?
Mr. Dawson. Yes, sir; in every instance they were followers of
Ro}^ Underwood, and backers of local autonomy.
Mr. Kennedy. And for their efforts, at least these four individuals
were beaten up ; is that right?
Mr. Dawson. Yes ; I think there are more than the four, but I can't
think of them at the moment.
Senator Mundt. Did any violence take place in the union hall ?
Mr. Dawson. Yes, sir. McCarty, that took place rignt outside of
the union hall, and perhaps a continuation of an argument that started
in the union hall. The argument with Gale took place actually dur-
ing the meeting, and immediately when the meeting was over he was
jumped again. As soon as the meeting was adjourned. Those two
• did take place in or very close to the union hall.
Senator Mundt. There was a direct connection in those two cases
obviously between the fact that these men were protesting the conduct
of the union, and the fact that the goon squad was there to keep them
quiet and intimidate them ?
Mr. Dawson. I would say there was a very close connection, sir.
Senator Kennedy. Do you know what the procedure is for taking a
local out of trusteeship ?
Mr. Dawson. I am reasonably familiar with the constitution; yes,
sir.
Senator Kennedy. Could you tell me what you would do to take it
out of trusteeship ?
Mr. Dawson. As to what you would do to take it out ? I certainly
don't know how you would take it out. I know the procedures that
the constitution outlines, sir. But I have no assurance that would
take you out.
Senator Kennedy. I have a copy of the constitution here. Can you
tell me from memory ? If the local is in trusteeship, and the meni-
bers desire to take their local out of trusteeship, how can they do it
and how is it provided in the constitution ?
IMPROPER ACTIVrriES EST THE LABOR FIELD 7955
Mr. Dawson. I think the first step, and I believe I have a copy of
it, would be to appeal to the general executive board who in this case
was the same board. They didn't impose the supervision but they
are the ones that threw Mr. Underwood out.
You would appeal to tliem first, and they have already sat as a
judge on the case, so you must appeal to them. If that fails, the
next appeal is to the general convention. That is held once every
4 years. The last general convention was held in 1956, as it per-
tained to our case our trouble happened in 1952, and it meant a wait
of 4 years to appeal to tlie general convention. That is so that it
might be heard.
Then of course at the general convention, I know the people from
our local miion were appointed by the general president as the dele-
gates, so I don't think that we would have gotten a great deal of jus-
tice there.
Senator Kennedy. In the constitution, it says that the president
shall have the power, in article 6, section 3 —
to direct all local unions, the local oflScers, or any other subdivision of the in-
ternational union, whenever in his opinion the best interests of the organization
require it or local unions and local officers or other subdivisions of the inter-
national unions shall be deemed to be incompetent, negligent or to have failed
in carrying out their respective duties or to have violated the ritual regulation,
and laws or decisions of the organization, or its duly constituted authority. He
shall have full power to suspend or remove such individual members, and sus-
pend or remove such local officers and suspend or revoke charters of such local
unions, or place such local unions and their officers and members under inter-
national supervision.
He shall have power to designate and appoint persons to fill the places of
those local officers of local unions suspended, removed, or placed under inter-
national supervision, which appointee shall conduct the affairs over which they
have been appointed for such time and in such manner as he may direct.
All of the business finances and affairs and so on shall be placed under inter-
national supervision by him, shall be fully and completely conducted and admin-
istered by the general president or his deputy.
During such suspension, all rights and powers of local unions to conduct its
own affairs shall be suspended.
Now, it doesn't say anything about the procedure to be followed.
It says he shall be vested with unlimited discretion in the applica-
tion of administration of his power and duty.
Now, can you tell me ? I don't know where it says anything about
the locals shall after a certain period of time and upon appeal to the
executive board shall have the right and power to remove themselves
from this kind of supervision. I don't see that it says that, number
one, and if the delegates are appointed to the convention at the end
of a 4-year period by the president as part of his authority as trus-
tee it seems to me that you are completely under his control by the
way this language reads.
Do you know of any other provision of the constitution which
would cause you to think differently from that ?
Mr. Dawson. No, sir, I don't, and that is when you asked the ques-
tion as to how you would get out from under trusteeship or super-
vision. I said these are the steps outlined in the constitution. But I
certainly have no assurance that that will get you out.
Senator ICennedy. I think that that is completely unsatisfactory,
don't you think so ?
Mr. Dawson. I am in complete agreement with you, sir.
7956 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Kennedy. Don't you think that there is an obligation to
the members of the Operating Engineers to reform their constitution
so that definite and precise charges shall be made before an inde-
pendent body before a local is taken into trusteeship, and then the
local shall be permitted to take certain steps to take themselves out of
trusteeship ?
Mr. Dawson. Well, certainly it has been our experience that that is
one of the greatest evils that we have been exposed to. It is this
power of the general president, and the manner in which they have
been exercised.
Senator Kennedy. It seems to me that the failure to do this re-
quires at least some general supervision by the Department of Labor
or some other responsible agency of the Government to make sure that
the constitution meets certain minimum standards of equity in these
kind of cases, and so that there is some road out for members of
locals, which are taken over by the president, who want to get out of
trusteeship. Thank you very much.
Mr. Dawson. I am in complete agreement.
Senator McNamara. Mr. Dawson, how did the president acquire
this authority ?
Mr. Dawson. By the makers of the constitution, I would assume^
sir.
Senator McNamara. That would mean the convention that adopted
the constitution ?
Mr. Dawson. Yes, sir.
Senator McNamara. I am a little bit bothered by the colloquy be-
cause of the fact that it seems that is the democratic way to do it, to
let these people decide on what their own ground rules are.
Now, we have found during these investigations, not only in this
union but in other unions, that there appears to be a great deal of
abuse of power that has been placed in the International President
by the convention.
I, too, am concerned as Senator Kennedy is, about this abuse. But I
am a little bit reluctant to accept the fact that the Federal Govern-
ment should step in at this point and lay down laws for this kind of a
nonprofit organization when we do not interfere with other types of
nonprofit organizations.
I think when we get into this setting down of rules for nonprofit
organization we are opening up a field that the Government is going
to get into, to which there is no end.
We can get into educational and religious and social groups of all
sorts. I approach it with a little fear and trembling as I xim sure the
other members of the committee do.
Senator Curtis. May I ask the Senator a question. Do you consider
this operation of Mr. Maloney, and Mr. Fay, and so on, as a non-
profit operation for them?
Senator McNamara. I was talking about the union generally, hav-
ing the right to make their own rules, and I was not talking about
the individuals, although I expect that by the same token, they have
as much right to elect their own leadership as any other organization
has.
I am afraid that in our zeal to be democratic and to see we have a
democratic organization, we might start by going up the road that will
insure anything but a democratic operation.
IMPROPER ACTrVITTES IN TliE LABOR FIELD 7957
I say I, too, want to do something in this field, but I am a little bit
fearful about the approach.
Senator Kennedy. I have never thought, in considering what Sen-
ator McNamara had to say, that the presumption was that a majority
had the power to do this. Even if that majority agreed to the con-
stitution, that does not lessen the rights of the minority who may
have opposed the phrasing of this constitution. Tliat certainly has
been the presumption upon which our Government has been estab-
lished.
There are rights of veto, and the independent judiciary, and so on.
All I am saying to the Senator, and I think he and I are in agi'eement,
is that I would like to see, as the AFL-CIO on ethical practices code
I think touches on this question of trusteeship, the Operating Engi-
neers and ever}^ other union in the country set down, so it is very
easily understandable, certain steps which must be followed before
a local ^oes into trusteeship, and certain steps that must be followed
and which can be followed to take a local out of trusteeship within a
reasonable length of time, if it meets these standards. If they do not
do it, I think it is vital that it be done, and I would consider whether
we did not have a responsibility to make sure that it be done.
Senator McNamara. I certainly agree with the Seantor, and since
he directed his remarks to me, I want to say for the record that I do
agree. But I do not want to start by not giving them an opportunity
to clean their own house, as they have indicated in many instances that
they are trying to clean it.
This is one of the things that they have to do. I think it is pretty
generally recognized. I believe we ought to give them that chance
before we try to swing the big stick. We are opening up an area
here that is fraught with considerable danger.
Senator JNIundt. Have you ever sat in, Mr. Dawson, at a convention
where they were working on the constitution of the international
union ?
Mr. Dawson. I beg your pardon.
Senator Mundt. Have j^ou ever sat in on any of the conventions
where they have been working on the constitution of the itnernational
union ?
Mr. Dawson. At the last convention, in 1956, 1 was there as a visitor,
and not as a delegate.
Senator Mundt. I am just curious, as are some of my colleagues,
about the fact that intelligent men such as you have in the Interna-
tional Union of Operating Engineers would vote upon themselves this
kind of constitution.
Now, I am wondering what the procedures were and if the delegates
and representatives of local union members themselves actually have
a part to play in formulating the constitution, which it shows here
was adopted in 1938, in referendum vote of the entire membership,
and has been amended in 1940, 1944, 1947, 1948, and 1951 by refer-
endum, and in 1952.
I am wondering why they impose on themselves an iron-fisted con-
stitution of that kind, if, in fact, they have an honest part to play
in formulating the constitution.
Mr. Dawson. My only answer to that. Senator, would be I know
from our own local union 542, the delegates were appointed by the
7958 IMPROPER ACTIVITIES IN THE LABOR FIELD
general president or by the supervisor. So I think yon can make your
own assumptions.
Senator Mundt. I can imderstand that is standard operating pro-
cedure for either local unions, that a constitution is pretty well
directed from the top, instead of bubbling up from among the mem-
bers. This is a typical kind of constitution that the Communists have.
This is a perfect constitution to protect the fellow in power, but it does
nothing for the minority.
There is nothing for the fellow who has a grievance, and there is
nothing for the man who wants to protest and make a change, because
everything comes down from on top, precisely as the Russians say.
They say they have a constitution which has been adopted by the
people and it is perfectly all right. Reading it, it sounds pretty good.
But reading it carefully, it all vests the authority in the folks at the
top, who are running the show. That seems to be the general weak-
ness of this constitution. I can appreciate if the delegates to the con-
vention are chosen by the men who have the great authority imposed
in their hands by the constitution, obviously they generate these
amendments to perpetuate that power.
It would be hard to understand if you had an honest representative
constitution and the members themselves sent their own delegates
there, why they should vote this kind of constitution on themselves.
I share Senator McNamara's dilennna on that one. But the point
you make is that in perhaps a considerable majority or at least a con-
siderable block of votes at a convention they are not representing the
union members, but representing the fellow who has given them
trusteeship authority and supervisory authority.
That sort of makes a shambles out of the whole convention.
Senator McNamara. Will you yield at that point ?
As a matter of fact, Mr. Dawson, does not this constitution of yours
generally follow the constitutions of international unions, even where
there are no trusteeships ?
Mr. Dawson. I don't know, sir. I am not familiar with any of
them.
Senator McISTamara. You ])robably do know that these constitutions
are generally adopted by a national convention that is supposed to
represent the rank and file and in general does represent the rank
and file, except where they are in trusteeship.
I don't think even in your international union, any great number
of local unions are constantly in trusteeship. I think never more than
about 10 percent, which might be an outside figure.
Mr. Dawson. I have no idea, sir.
Senator McNamara. So that getting back to the basis of the thing,
this is generally the way unions operate, and this is generally the
pattern of the creation of the constitution. And it is the same as
electing the President of the United States. He is ever3'body's Presi-
dent after you elect him, mine and yours, too.
Senator Mtxdt. If you will yield, if what you say is correct, and
you certainly know more about tliis than I do "from the standpoint of
personal experience, but if this is correct it gives weight to Avhat Sena-
tor Kennedy said, that perhaps the ethical-practices group or some
instrumentality of law should call to the attention of the union mem-
bership generally that constitutions of this type impose too much an-
niPROPER ACTIMTIPLS IN THE LABOR FIELD 7959
tliority ill the general officers and don't protect the i-ights of the
minority members.
Senator McNa:mara. T agree with that, and I think that our hear-
ings have developed this thing to a point where they should be con-
cerned with it. But if it is arrived at in a democratic manner — and I
think it was — then I would be reluctant to say that you cannot do this
in a democratic manner.
Senator Mundt. Mr. McDonald, of the Steelworkers' Union, vis-
ited me in my office one day, and 1 raised the question of trusteeships
with him, and he pointed out that their constitution, unlike this one,
provides a way out of a trusteeship. They have a different name for
them. But it provides a way out, and I think that is an important
thing to have in all constitutions.
Senator McNamara. May I reply, Mr. Chairman ?
I have not read this constitution, but I assume that the machinery
that })uts them in reserveshi]> or trusteeship or whatever they call
it, would be just i-eversed in taking them out. Again, they give all of
the authority to the general president so you would appeal to him, and
then you would take reverse action through the general executive
board to be restored.
I assume that that is implied in this but not spelled out.
Senator Mundt. That is probably the weakness of this constitution,
that it gives the general authority to the president to put them in, and
makes him the arbitrator as to whether they go out.
That is not the case as I understand it in the steelworkers' consti-
tution. There the}^ are put in under a certain circumstance provided
by general officers, but they have another way and another source
to which they can present the evidence by which they get out.
Senator McNamara. That is true.
Senator Mundt. You should not have the judge and the sheriff as
twin brothers in a case like that.
The Chairman. Is there anything further ?
Mr. Kennedy. A man by the name of McCarty was beaten: is that
right?
Mr. Dawson. Yes, sir.
Mr. Kennedy. I would like to call him as the next witness.
Senator Mundt. Before you leave, I think the preceding witness
gave us the name of a Dawson who was beaten up. That apparently
was not you ?
Mr. Dawson. No, sir ; it was not.
(At this point, the following members were present : Senators
McClellan, McNamara, Kennedy, Mundt, and Curtis.)
Mr. Kennedy. Mr. McCarty and Mr. Gale.
The Chairman. Come forward, Mr. McCarty and Mr. Gale.
Gentlemen, stand and be sworn. You do solemnly swear that the
evidence you shall give before this Senate select committee shall be
the truth, the whole truth, and nothing but the truth, so help vou
God? " i ^
Mr. Gale. I do.
Mr. McCarty. I do.
7960 IMPROPEIR ACTIVITIES IN THE L.\BOR FIELD
TESTIMONY OF NORMAN GALE AND T. C. McCARTY, JR.
The Chairman. Do you each waive the right of counsel to be present
while you testify ?
Mr. Gale. I do.
Mr. McCartt. I do.
The Chairman. Will you identify yourself, please, sir ?
Mr. Gale. My name is Norman Gale. I live at 2815 Jasper Street,
Philadelphia ; I am an operating engineer since 1947.
The Chairman. Thank you very much.
Mr. McCartt. My name is T. C. McCarty, Jr., 2 Edison Avenue,
Clementon, N. J.
The Chairman. What is your business or occupation, or what do you
do now ?
Mr. McCarty. My occupation is operating engineer, crane operator,
local 542.
Mr. Kennedy. Mr. McCarty, how long have you been with 542 ?
Mr. McCarty. A litle over 11 years.
Mr. Kennedy. Were you in opposition to the local being placed in
trusteeship in 1952 ?
Mr. McCarty. Yes; I was.
Mr. Kennedy. Were you one of those who was striving to have the
autonomy returned to the local ?
Mr. McCarty. Yes ; I was.
Mr. Kennedy. Can you tell us did you take a position at meetings
that the autonomy should be returned to the local ?
Mr. McCarty. Only one meeting.
Mr. Kennedy. Only one meeting ?
Mr. McCarty. Yes, sir.
Mr. Kennedy. Prior to that meeting, had you had any difficulty
with any of those who were running the local ?
Mr. McCarty. Yes. "
business agent.
Mr. Kennedy. How do you spell his name ?
Mr. McCarty. G-a-u-1-1.
Mr, Kennedy. He was a business agent ?
Mr. McCarty. Yes ; he was.
Mr. Kennedy. Had he threatened you at all ?
Mr. McCarty. Well, he come on the job up there some time in
January, and he threatened me there.
Mr. Kennedy. January of what year ?
Mr. McCarty. January of 1953.
Mr. Kennedy. What did he say to you at that time ?
Mr. McCarty. Well, he come in there, and he had come on the job,
and we were eating lunch, and he told me, he says, "We are going to
have a meeting." He says "Sometime the latter part of February,
or the beginning of March" of that year. And he says "You," and
he pointed to me, "Don't you be there." He says "H you are there,
we are going to have you carried out."
So I told him, "Well," I said, "it will take 10 good men to do it."
Apparently they knew what they were talking about, because they
did it.
Mr. Kennedy. Did you say you were going to go to the meeting
anyway ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 7961
Mr. McCarty. I told hiin I would definitely be at that meeting;
yes, sir.
Mr. Kennedy. Had you been causing them some trouble prior to
that time? You had been on the side of Mr. Underwood?
Mr. McCarty. I was on the side of Mr. Underwood. I never caused
nobody no trouble.
Mr. Kennedy. But you had been supporting Underwood ?
Mr. McCarty. Yes, sir.
Mr. Ivennedy. Did you go to the meeting then ?
Mr. McCarty. Yes, sir ; I went to the meeting.
Mr. Kennedy. Would you tell what happened ?
Mr. McCarty. I went to the meeting, and I met Mr. Gale down
the street, and we went up in the Broadwood Hotel, the sixth floor,
and walked in, and we found a place to sit down with the wall to our
backs so nobody could hit us from the rear, from the back.
The meeting got started, and there was a fellow by the name of
Jerry Leone, an ex-business agent that had been fired, or he quit, I
don't recall what happened to him.
Anyhow, he had a motion on the floor that all nonmembers of 642
must leave.
Mr. Kennedy. Leone was friendly toward you ; is that right ?
Mr. McCarty. Leone was friendly toward me. There were several
fellows in there that didn't belong to the local — some people called them
goons, I don't know what to call them — that didn't belong to our local,
who was with Mr. Wharton.
Mr. Kennedy. And Mr. Wharton was the one that was running the
union? He was the trustee?
IMr. McCarty. Yes, sir ; he was on the rostrum ; yes, sir ; and Mr.
Wharton has control of the meeting at that time.
Mr. Kennedy. And he has at least two individuals with him that did
not belong to the local ?
Mr. McCarty. At least, sir ; yes, sir.
Mr. Kennedy. And who were felt by you people to be outsiders that
w^ere there that might cause some difficulty ; is that right ?
Mr. McCarty. That is correct. Anyhow, Jerry Leone had this mo-
tion on the floor, and Mr. Lentino.
Mr. Kennedy. How do you spell that ?
Mr. Gale. L-e-n-t-i-n-o.
Mr. Kennedy. What was his position ?
Mr. McCarty. Operating engineer.
Mr. Kennedy. What was he doing in the local ?
Mr. McCarty. His position there was troublemaker. That is ac-
tually what his position was. That is what he was there for.
Mr. Kennedy. He was the one that was running these so-called
goons ?
Mr. McCarty. That is correct. And he kept interrupting Mr. T^one,
and Anally the floor recognized Lentino, instead of Mr. Leone. So I got
up and all I said was "Lentino," I said, "why don't you sit down until
Mr. Leone has his say, and when he is finished he will sit down and you
can get up and say what you have to say ?''
"Wliat the hell are you, a tough guy ?"
And he started across the floor. Well, that is all right. Previous to
that Mr. Wolgast, Johnny Christaldi, I believe, is his other name, was
thrown out because he is a nonmember.
7962 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Mr. Wolgast ?
Mr. McCarty. Yes. Johnny Christaldi or Wolgast.
Mr. Kennedy. He was an ex-prizefighter ?
Mr. McCarty. An ex-fighter ; yes.
Mr. Kennedy. He started across the floor at you ?
Mr. McCarty. He come in another door, from where I don't know,
but he come off my left and Lentino was to my right.
I just moved to the side, and here goes Wolgast by me. He started
to swing, and, of course, he didn't hit, so there was no damage. So, the
first thing I know, the meeting was adjourned. So I looked around,
and the exit to my right had a crowd, a crowd of nice, polite boys. So
I looked to my left, and there was also a crowd.
Mr. Kennedy. What do you mean, a crowd ?
. Mr. McCarty. Well, a gang of guys that are known to be a little
on the boisterous side. So I said to Gale — I said, "I am going to
leave." I said, "I am going to go." Before I got up I noticed Len-
tino run up to the rostrum, and he was talking to Mr. Hunter B.
Wharton, and then he went back to this group at the door, at the
exit. At the door was Altamuro.
Mr. Kennedy. Altamuro ? Joe Altamuro ?
Mr. McCarty. Joe Altamuro, Wolgast, Peter Bozzelli, Peter Panta-
lep, and a few other fellows there. I foi'get who they are.
I noticed him talk to Pete for a few minutes, Pete Pantaleo, this
Lentino, and then he went back to the rostrum. He made a couple
of trips. Hunter B. "Wliarton, on one of the trips, directly pointed
out at me and nodded his head. Of course, I didn't pay much atten-
tion to it. We both noticed it, because we were sitting together. So
I told Gale — I said, "Well, I am going to go," and he says, "All
right, let's go."
When I got up, they were all standing at the exit. Naturally, I
walked right into the middle of them. Walking through them, to
Pete Pantaleo, he goes like this [indicating] to Pantaleo and the rest
of the group. I didn't pay it no mind. I figured something was
going to happen outside the hotel, where I would have a little Ijit of
room and wouldn't care. So we get in the elevator, and in boarding
the elevator there was a man who had been on the elevator, who came
from one of the floors above, and this girl operator. So we walked
in and we turned around ; and when I turned around I said to Gale,
"Here they come." And there was a mad rush for the elevator. I
said, "This is it."
The first thing I know is Altamura — he says, "So you're a tough
guy," and he puts his fingers up and was about to gouge my eyes out.
Mr. Kennedy. That is Altamuro ?
Mr. McCarty. Yes; Joe Altamuro. So when he went to do that,
I naturally protected myself and backed myself into a corner. The
elevator was crowded, and you couldn't get no room at all, I mean,
to move.
Mr. Kennedy. You mean all of these ])eople had gotten on i
Mr. McCarty. All of these people had gotten on and crowded me
in, and I just couldn't move at all. So Frank Lentino, he went right
for the groin, the nice fellow that he is — that was his depth; he had
to take that depth — and the rest of the fellows worked above the belt.
Of course, I was kicked and other things, and I took brass knuckles
on the ear, I took them on the side of the jaw and on the nose. They
IMPROPER ACTIVrriES IX THE LABOR FIELD 7963
tell me that the elevator went up and down while the fight was going
on. I don't know where the elevator was going; I was busy. So
finally they kicked me off at the sixth floor.
Mr. Kennedy. Do you know how many times the elevator went up
and down during this period ?
Mr. McCarty. I don't know; no, sir. I heard some reports of
6 or 7 times. I don't know. I was busy thinking to defend myself.
Senator Curtis. Who was operating the elevator ?
Mr. McCarty. Peter Bozzelli.
Senator Curtis. What happened to the girl operator ?
Mr. McCarty. She was still inside, but they pushed her and took
the controls from her, as best I can remember.
Senator Curtis. What happened to the guest in the hotel that was
on the elevator when you got on ?
Mr. McCarty. To tell you the truth, Senator, I don't know.
Senator Curtis. You don't know whether lie stayed on ?
Mr. McCarty. No, sir.
Mr. Kennedy. What was Peter Bozzelli doing ?
Mr. McCarty. Peter Bozzelli had taken the controls. When I
looked up, Peter Bozzelli had the controls of the elevator.
Mr. Kenne:dy. Where is Peter Bozzelli now?
Mr. McCarty. Peter Bozzelli is dead.
Mr. Kennedy. Plow long ago did he die ?
Mr. McCarty. Two years ago, I guess.
Mr. Kennedy. AVas he in the union at tlie time ?
Mr. McCarty. When he died? No, sir.
Mr. Kennedy. Where was he when he died ?
Mr. McCarty. In prison. He went to prison for killing his own
daughter.
Mr. Kennedy. For strangling his daughter?
Mr. McCarty. Yes, sir.
Mr. Kennedy. That was shortly after this fight ?
Mr. McCarty. That was shortly after this fight. Incidentally, the
body of the girl that he killed, he threw within 10 miles of my home.
Mr. Kennedy. And did a number of these other people that got in
that elevator with you have criminal records ?
Mr. McCarty. Yes, sir; from what I understand. Yes, sir.
Mr. Kennedy. Frank Lentino ?
Mr. McCarty. From what I understand he has a criminal record ;
yes, sir.
Mr. Kennedy. John Christaldi; was he in the elevator with you?
Mr. McCarty. Yes, sir; that is another name for Wolgast.
Mr. Kennedy. He is the ex-fighter ?
Mr. McCarty. That is wdiat they tell me. I don't know, myself.
Mr. Kennedy. He has been arrested 7 or 8 times ?
Mr. McCarty. I don't know about his convictions; no, sir.
Mr. Kennedy. I l>elieve he has been arrested 7 or 8 times.
John Christaldi, was he there ?
Mr. McCarty. John Christaldi. that is Wolgast.
Senator Mundt. Were these all men of your local union, or were
they imported from some place outside ?
Mr. McCarty. Well, we had, I believe, 9 warrants made, and I
believe we could name 6 that was actually on the elevator or actually
in the elevator, and the rest we couldn't name. We had several
7964 IMPROPER ACTIVITIES IN THE: LABOR FIELD
John Doe's. In the trial, one of the fellows they had as a witness
put himself on that elevator, so that we knoAv he was there. And I
understand that he is one of them nice boys also.
Senator Mundt. The question was: Were these men that were
attacking you and beating you up members of your local union or
were they fellows that had been imported ?
Mr. McCarty. Well, some belonged to the union, yes, sir, that is,
the parent body, 542 ; some belonged to B local and some belonged to
A local. Then there was some in the State of New Jersey. I know
they were from the State of New Jersey, but I never could name them
or identify them.
Senator Mundt. Some of them were imported and some were home
fellows ?
Mr. McCarty. That is right.
Senator Curtis. At what hotel did this happen ?
Mr. McCarty. The Broadwood Hotel in Philadelphia.
Senator Curtis. About when was it ?
Mr. McCarty. I think it was March 3, 1953.
Senator Curtis. 1953?
Mr. McCarty. Yes, sir.
Senator Curtis. Where did you go after they dumped you out on
the 6th floor?
Mr. McCarty. I went back in the union hall.
Senator Curtis. Did you later seek medical attention ?
Mr. McCarty. Yes, sir ; I did.
Senator Curtis. Where did you go ?
Mr. McCarty. I w^ent to the Hahnemann Hospital.
Senator Curtis. How long did you remain there ?
Mr. McCarty. I would say I was in Hahnemann about an hour and
a half to 2 hours in all.
Senator Curtis. What was the extent of your injuries ?
Mr. McCarty. Bruises about the face, the head, some pretty good
cuts, and bruises in the stomach, bruises to the leg. That is about all.
Of course, that is enough.
Senator Curtis. Why did you go back to the union hall ?
Mr. McCarty. Why did I go back to the union hall ? Well, I had
something to say to them.
Senator Curtis. You had what ?
Mr. McCarty. I had something to say to them.
Senator Mundt. Good. What did you say when you got there ?
Mr. McCarty. Well, when I first got off the elevator
Senator Mundt. Were they back in session by that time again ?
Mr. McCarty. They weren't back in session, but there was a lot of
men "Still in the local, in the meeting hall. When I first got off, the
first person I seen was Peter Pantaleo, an ex-fighter, and the fellow,
one of the boys, that put the finger on me, and I naturally told him what
I thought of him. I took my jacket off and I was ready and raring
to go, and he turned around and talked away. So I went on in the
union hall, and Mr. Wharton was still on the rostrum, and I told Mr.
Wharton, I said, "You're the S. B. that put the finger on me.*' I said,
"You haven't heard the end of it." Of course, at that time I was going
to do it the old-style way, do everything the way they did it to me.
JBut the body of men that was around, they talked me into taking
things through court.
IMPROPER ACnVITIEiS IN THE LABOR FIELD 7965
That is the best way, they said. "Why should you jeopardize your-
self and you go to jail? Because that is what is going to happen."
So, naturally, that is what I did. But in that meeting hall, if I recall
right, I said "Give me any six good Underwood men and I will
clean the place out."
Naturally, fellows gathered around, and we walked out to the ele-
vator. While I was in there, I did tell them, "If this is what the
international can give you, take a good look, because I want no part
of it."
So we walked back out to the elevator, and I got back in that same
elevator that I was in once before, and we walked down to Hahne-
mann Hospital, and tlie nurse took care of me.
Of course, she took care of everything above my belt. I didn't
want to make too many complaints. Then I went from there, and I
drove my own car, I drove my own car to the police station, and filed
my complaints, and we had a little meeting after that with Mr.
Underwood. I went and seen him and told him of my difficulties, and
then I went on home. The next morning, I went to District Attorney
Dilworth, to his office, Avhere he advised me to have pictures taken of
my condition, and start proceedings against these people, which we
did.
The Chairman. Did you have pictures taken ?
Mr. McCarty. Yes, sir ; I did.
The Chairman. I hand you four pictures and ask you to examine
them and state if you identify them.
Senator Mundt. These were taken, I understand, the next morning
after the fight?
]\Ir. McCart^'. Yes, sir. They were taken, I would say, about 11
o'clock the next day.
(Photographs were handed to the witness.)
Senator Mundt. Did the district attorney prosecute ?
Ml'. McCarty. Well, we first tried to get it — yes, sir; these are my
pictures.
The Chairman. Finisli answering the other question, first.
Mr. McCarty. We first had it tried in front of a magistrate, Don-
nelly, and, in waiting for Mr. Donnelly to come out of his chambers,
we knew what was going to happen. It was a steady stream going
in and out of his chambers ; we knew what was going to happen. It
as a steady stream going in and out of his chambers ; Magistrate Don-
nelly. So, when he comes out, he finally called it a brawl. Before he
called it a brawl, he said, "Just what did Lentino do to you?" Well,
Lentino, I know what he did. There is no doubt in my mind at all
what the man did. But, when they asked me what Willie O'Neil did,
an ex-murderer, I couldn't put my finger on it, because I told him I
was busy defending myself, not watching what each individual was
doing. He said, "Well, this is nothing but a brawl, a union brawl.
Case dismissed."
Senator Mundt. Wlio said that?
Mr. McCarty. Magistrate Donnelly.
Senator Mundt. You said there had been a steady sti-eam going in
and out of his office.
Mr. McCarty. That is right.
Senator Mundt. Do you mean a stream of Wliarton's people ?
21243—58— pt. 20 4
7966 IMPROPER ACTIVITIES IN THEi LABOR FIELD
Mr. McCarty. AVell, one of the heads of the teamsters, a business
agent, was there. I don't know his name, but Mr. Underwood pointed
him out to me, and so did some of the other members that knew him
point him out, and different racketeers of Philadelphia was back and
forth in the man's chambers. So, we went back after that; we went
back to the district attorney, and we went before Judge Sloane, and
he held seven of these people for court. I don't recall the name of the
last judge that we had when we M-ent back into the thing again. But
the hnger motion, or the thumb motion and the finger motion wasn't
sufficient evidence to convict Hunter B. AVharton or Pete Pantaleo.
The evidence on the job site, by Mr. Gaull, the threat, that wasn't
enough evidence on that to hold Mr. Gaull.
The ChairmajS^. You can shorten it a little. Were any of them
convicted ?
Mr. McCarty. Yes, sir; they were convicted. Frank Lentino, Joe
Altamuro, and Wolgast. Those are the three that were convicted.
They were fined $200, and that was it.
Senator Mundt. No jail sentence ?
Mr. McCarty. No, sir. Incidentally, I understand that the union
hall paid that.
Senator Mundt. The union paid the fine ?
Mr. McCarty. Yes, sir. Which means that my dues helped pay it.
The Chairman. Will you exauiine those pictures that are before you
and state whether you identify them ?
Mr. McCarty. Yes, sir ; I do identify them.
The Chair:man. There are four of them. Who are they pictures of ?
Mr. McCarty. Four pictures of myself.
The Chairman. Taken when ?
Mr. McCarty. Taken on the -ith of March.
The Chairman. That was the next day after you had been assaulted
the night before ?
Mr, McCarty. These were taken approximately 11 o'clock the day
after I had been assaulted ; yes, sir.
The Chairman. Those pictures may be made exhibit 77.
(The documents referred to were marked "Exhibit No. 77" for
reference, and may be found in the files of the select committee.)
The Chairman. Proceed.
Senator Kennedy. Mr. Chairman ?
The Chairman. Senator Kennedy.
Senator Kennedy. The innnediate reason for your being beaten up
was that you had suggested that another man should have the right
to finish his statement on the floor, and then they turned to you and
said, "AYliat are you, a wise guy ?''
Mr, McC'ARTY. That is correct; that is absolutely correct.
Senator Kennedy. And the reason for the discussion at that meeting
was the desire of some of the members to end the entire national's
control over your local; is that correct? Is that what you were
arguing about ?
Mr, McCarty. No. The argument was then to have all nonmembers
leave the hall, nonmembers. That means bodyguards. That is what
it referred to ,
Senator Kennedy. Wliat Avas the purpose of the meeting?
Mr. McCarty. Well, they called the meeting. They said the pur-
pose was to tell us what was going on, I jDresume.
IMPROPER ACTIVITIES IN THE LABOR FIELD 7967
Senator Kennedy. Do yoii mean the international, the trustees 'i
Mr. McCarty. The international ; yes, sir.
Senator Kennedy. Do you know did they conduct any business at
the meeting-, or, after you got beaten up, did that end the meeting?
Mr. McCarty. No business was conducted at all ; no, sir.
Senator Kennedy. In other words, the immediate reason for your
being beaten up, despite the fact that you were not supporting the
local group, was because you requested that a member be permitted
to finish his statement t
Mr. McCarty. That is right.
Senator Kennedy. Then you A^ent into the elevator, and you say 7
or 8 people beat you up ?
Mr. McCarty. Yes, sir.
Senator Kennedy. Did they knock out your teeth?
Mr. McCarty. They certainly did.
Senator Kennedy. All of your teeth ?
Mr. McCarty. They didn't knock any of the teeth out, but they
loosened where I couldn't eat at all. I had to go to the dentist and
have them pulled out.
Senator Kennedy. How long after the beating up did they take
your teeth out ?
Mr. McCarty. I would say less than a month.
Senator Kennedy. From l^eing hit with a brass knuckle?
Mr. McCarty. Yes, sir.
Senator Kennedy. Did you get hit in the side that causes you some
difficulty now (
Mr. McCarty. Yes, sir. I have trouble with my stomach now. I
had an operation, I would say, 2 months ago, or 2i/2 months ago. I
had an operation and had a lump taken off my side.
Senator Kennedy. AVas it a cancerous tumor ?
Mr. McCarty. That is what they claim ; yes.
Senator Kennedy. Is that where you got hit ?
Mr. McCarty. Yes, sir.
Senator Kennedy. Are you getting some compensation from some-
one for that ?
Mr. McCarty. No, sir. I still owe $50 on this operation. When
I called the welfare, the welfare said ''You are not eligible.""
When my teeth were knocked out — teeth don't come into the wel-
fare. It is only hospitalization. If you go to the hospital and have
your teeth out, yes ; but when you walk into a dentist ; no.
That is what I was told over the telephone.
Senator Kennedy. Did the local union or the international union
do anything about your hospital bills?
Mr. McCarty. Not a thing.
Senator Kennedy. Yet they paid the tines of the men that were con-
victed of beating you up ?
Mr. McCarty. That is right. I understand Mike Concordia paid
my bill at Hahnemann Hospital the night I walked in there.
Senator Kennedy. What about your legal bill ( Wlio paid that (
Mr. McCarty. My legal bills?
Senator Kennedy. Yes.
Mr. McCarty. Nobody ever paid them.
Senator Kennedy. Who defended them? Their attorney?
7968 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. McCarty. They had their attorney, yes, sir; the international
attorney.
Senator Kennedy. The international attorney represented them?
Mr. McCarty. The attorney who represents the international and
local 542 in Philadelphia.
Senator Kennedy. He represented them ?
Mr. McCarty. Yes ; first they had Mr. Wolf.
Senator Kennedy. Wlio was that?
Mr. McCarty. Mr. Wolf, I believe it was.
Senator Kennedy. He was the lawyer from the international ?
Mr. McCarty. He was at that time. I am pretty sure. Then in
tlie last case they had McBride.
Senator Kennedy. What is he ?
Mr. McCarty. Right now he is a lawyer. He represented them the
lust time.
Senator Kennedy. Your suit wasn't aeainst the international; was
it?
Wasn't it against these men ?
Mr. McCarty. That is right.
Senator Kennedy. Why were they defending the men ?
What did they have to do with the international ?
Mr. McCarty. I don't know. I was on the outside, not on the
inside.
Senator Kennedy. As I understand it, had all of your teeth been
knocked out, as a result of this, and you were hit in the stomach,,
which caused you to be operated on 2 months ago, which may be a
tumor, and which may be malignant, as a result of the beating up,
and 3 of the men were convicted.
Their fines were paid by the union, and your hospital bills, which
I imagine have been substantial, and your legal bills, were not paid,
and to the lawyer representing the union, or representing the de-
fendants, fees were paid by the union, the international?
Mr. McCarty. Yes ; well, the district attorney
Senator Kennedy. I understand. He prosecuted the case.
Mr. McCarty. He prosecuted the case. If there was a bill, I don't
know anything about it. I wouldn't faiow anything about it.
Senator Kennedy. So the district attorney handled your part of
the case. The union paid for the defendant's lawyers.
Mr. McCarty. Yes. The first two cases Avas liandled by Mr. Freed-
man, Abe E. Freedman, attorney at law in Pliiladelpliia, the first two
cases, my cases, in front of the magistrate and in front of the judge.
Judge Sloane. Abe Freedman handled my case.
Senator Kennedy. Who was president of the international union
at that time?
]Mr. McCarty. Maloney.
Senator Kennedy. Counsel, all of tlie statements he has made are
in accordance with the facts as the committee investigation disclosed?
Mr. Kennedy. I don't know about the fine. We were going to get
into that Avith a witness who Mill follow, who will testify on that
liiniself. So we will develop that with hiiu. A< far as the legal bills,
we will develop that as we go along.
Mr. M('(\\RTV. ]\Ir. Keimedy, there is one thing I would like to say.
AMien I approached Mr. Wharton, when he was on the rostrum
Mr. Kennedy. He was the one that was running the local?
IMPROPER ACTIVITIES IN THE LABOR FIELD 7969
]\rr. McCarty. Yes, I told liiiu about this matter, and he told me
"Don't come up here with any of your God danni personal problems."
Mr. Kennedy. This was after you had gotten beaten up ?
Mr. McCarty. This was after I was tilled with blood and every-
thing else. He said, "I don't want to hear your personal problems,"
and he turned away.
The Chairman. He wouldn't hear your union problems in the first
place, and he wouldn't let a man speak.
Mr. McCarty. No, sir.
Senator Mundt. Who was the attorney you mentioned ?
Mr. McCarty. That is Mr. Freedman, the one that is helping us
with this case of ours.
Senator Mundt. You said he represented you in your first case
before the magistrate and before the judge.
Mr. McCarty. That is right.
Senator Mundt. Well, that was the district attorney, wasn't it?
Mr. McCarty. He only represented me after it got so far into
court. I don't know how it works. I am not a lawyer. I don't know
how that comes about.
Senator Mundt. I was wondering. I don't know how it works in
Philadelphia, but out our way if you are in trouble of that kind, the
district attorney's office would represent you and present your case.
Apparently you had to have your own lawyer.
Mr. McCarty. Well, yes, sir j I imagine so.
Senator Mundt. The district attorney did not plead your case
before the magistrate ?
Mr. McCarty. Not before the magistrate, no, sir.
Senator Mundt. Nor before Judge Sloane ?
Mr. McCarty. Not before Judge Sloane, but before the other
judge, yes, he did.
The Chairman. Are there any questions of Mr. Gale ?
Mr. Kennedy. Yes.
The Chairinian. Counsel tells me possibly some of these folks that
beat you up are here in the room. Do you know whether they are
or not?
Mr. McCarty. Yes, sir. They are here.
The Chairman. Will you identify them?
Call their names and I will have them stand up.
Mr. McCarty. Frank Lentino.
The Chairman. Stand up, please.
Mr. McCarty. Joe Altamuro.
The Chairman. The next one?
Mr. McCarty. Jolmny Wolgast.
The Chairman. You gentlemen stand up.
Call the others. Did Wolgast stand up ? He is not here.
Mr. McCarty. Peter Bozzelli. He can't.
Mr. Kennedy. He is the one that died in prison.
The Chairman. You two gentlemen come forward and take seats
behind these men.
Mr. Kennedy. Lentino. I said that already.
The Chairman. I want to ask the witness to turn around and look
at those two men he identified by name.
State under oath whether they are the ones that participated in
beating you up.
7970 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. McCarty. Yes.
This is the one that works below the belt and this is the one that
tried to gouge my eyes out.
The Chairman. The one with the glasses worked below the belt,
is that correct ?
Mr. McCarty. Yes, the one with the glasses. He works below the
belt. He don't work above the belt.
The Chairman. What was the size of these other men that helped
them ?
Mr. McCarty. Well, there is another one here that put himself in
the elevator.
The Chairman. What is his name ?
Mr. McCarty. Zirpoli. He put himself in the elevator, but he'
claims he walked in and got hit and that was the end of it. He don't
know what happened. I couldn't identify him as being in the fight.
The Chairman. You know these two, though, attacked you?
Mr. McCarty. Definitely.
The Chairman. You don't know that he did ?
Mr. McCarty. No, I don't.
The Chairman. Is Lentino here ?
There he is.
Mr. Kennedy. Pantaleo^
Mr. McCarty. Pantaleo was not in the fight.
Mr. Kennedy. Mr. Gale, can you tell us what happened, or what
connection you had with this ?
Mr. Gale. Well, as Mr. McCarty told you, I went to this meeting
with him, and he had heard and we had heard — I wasn't in the day-
room when Gaull threatened him and told him if he come to the
meeting he would be carried out bodily. I didn't happen to be in
there, but I heard about it. I had met Mr. McCarty and went to
this union meeting with him. Having heard the threats that were
made against him, him and I, we took seats with our backs to the wall.
(At this point. Senator McNamara withdrew from the hearing-
room. )
Mr. Gale. Mr. Wharton came in with, I would say, 3 or 4 strange
men. I don't know the right number of them. But we knew they
didn't belong in the union. They were bodyguards for Mr. Wharton.
He was going to come in and impose his will upon the membership,
and he brought these men to back liim up.
The Chairman. Were these two men behind 3^011 tliere among those
that he brought?
Mr. Gale. No, sir. These are our men. These are our good union
men.
The Chairman. Local men?
Mr. Gale. Yes, sir.
(At this point, the following members were present: Senators
McClellan, Ervin, Kennedy, Curtis, and Mundt.)
Mr. Kennedy. They were with you all of the time ?
Mr. Gale. Sir, they had been in the local, and tliey are local union
members.
The Chairman. Proceed.
Mr. Gale. Everybody noticed these bodyguards with Wliarton and
they were nothing more or less than bodyguards. Mr, Wharton
opened the meeting, and Mr, T^one immediately made a move that
IMPROPER ACTniTIES IN THE LABOR FIELD 7971
these o:entlenien that caine in with j\Ir. Wharton were not members of
the local, and they had no bnsiness in the hall, and wonld they please
move.
Well, Mr. Wharton said, "No; they came with me, and they are
going to stay with me. I am running the meeting, and they are going
to stay with me."
So around the floor or through the hall a lot of the other members
complained and said, "No, no, take them out. They should go out and
they don't belong in here."
Mr. Wharton insisted he was running the meeting and they were
going to stay.
They started to abuse Mr. Leone, and especially Mr. Lentino. He
took it upon himself to shut Mr. Leone up, and have the meeting
going on, and these bodyguards stay in there.
So there were a lot of people in the union who were saying or trying
to back up Mr. Leone in his contention that they should be removed
from the hall, that we didn't feel safe carrying on a meeting with
them in there. They stood up on each side of him, with their hands
in their brief cases, and glowered at us.
The Chairman. In their brief cases ?
Mr. Gale. Yes; and two of the other ones sitting in the body of the
meeting,
McCarty got up and said, "Oh, no." Mr. Wharton tried to give the
floor to Lentino, and Lentino was the loudest in hollering "Let them
stay here. Wharton knows what he is doing, and they ain't hurting
anybody, let them stay here."
So Mr. McCarty got up and said, "Now Jerry Leone has the floor,
and why don't you let Mr. Leone try to put this motion on the floor,
and if it doesn't go by, if the membership wants them to stay, or wants
them to go, then you can say what you have got to say."
So Lentino he took oft' his coat, and he started for Mr. McCarty.
There was a slight scuftle. There wasn't much to it.
Mr. Kennedy. I think what Mr. McCarty said about what trans-
pired. Do you have any corrections in that, up until the time he got
in the elevator?
Mr. Gale. Oh, yes.
Mr. Kennedy. Just take it up to the time that you got into the
elevator, and these people were at the door and then you got in the
elevator.
Mr. Gale. He made a slight understatement about these people at
the door, Mr. Kennedy, if you will bear with me a minute.
The Chairman. He made an understatement ?
Mr. Gale. Yes, sir.
The Chairman. All right, bring it up to its proper level.
Mr. Gale. He said they were a boisterous gang at the door. They
were about the most vicious gang of thugs that you ever come across
or anybody else did.
Now I want to tell you who was in this gang of thugs. There was
Mr. Lentino. He did time for a stickup in New Jersey, and he
attempted to emasculate Mr. McCarty. He was boisterous.
Mr. O'Neill was a murderer, and he w^as parolled in the custody of
Pete Pantaleo, our business agent. He was a little boisterous, too.
Altamuro, he is a mayhem artist, and he bit McCarty 3 or 4 times
on the side and tried to gouge his eyes out. I didn't see him bite him,
7972 IMPROPER ACTIVITIES IN THE LABOR FIELD
but I saw the marks and I saw him try to gouge McCarty's eyes out.
Willy Jackson was there, and he is one of the ring leaders that go up
and down the hall threatening to beat your brains out if you open
your mouth or ask a question. He was a little boisterous, too.
Mr. Bozzelli, you know his history. He went to jail for murdering
his daughter, and he died in there and he committed sex offenses
against his own daughter.
Wolgast, he was an eye gouger and belly kicker too.
Now that is who was in the gang, and they are led by Pantaleo and
Mr. Lentino here.
Senator Curtis. I want to ask you, who paid these fellows?
Mr. Gale. Nobody paid them, sir. They did that out of of the
goodness of their heart for Mr. Wharton and Mr. Maloney, to sub-
jugate the union and the membership.
Senator Curtis. Do you really believe they were not paid ?
Mr. Gale. No, sir, they were paid in kind. They got jobs as master
mechanics and business agents. That is how they were paid. That is
the only way they were paid.
Senator Curtis. All right.
The Chairman. Proceed.
You got to the door now with all of these thugs ?
Mr. Gale. Yes, sir.
The Chairman. What happened when you got to the door trying
to go out?
Mr. Gale. As we went out, Pantaleo put the finger on us, or rather
it was the thumb, and he indicated like this, pointing his thumb, and
we went and got in the elevator. When we got there, there was one
man in there that apparently come from up above, and the operator,
a woman operator, a lady operator. We got in the elevator and went
to the back of the elevator and turned around and McCarty said,
"Here they come." And they came with a flying wedge and pushed
everybody aside, and slammed the doors of the elevator and told the
operator to take it up. Then we will go up a ways and they said,
"Take it down," and they immediately started to tearing McCarty to
pieces.
Mr. Altamuro, this one here, he was the first one to go for McCarty's
eyes, and so he said, "You are the dumb bastard," and he went right
for McCarty's eyes with his fingers.
Mr. Lentino, he started punching at him. And everybody in that
car except me and the girl that run the elevator, and the man who came
down, gouged and kicked and punched at him. I stood alongside
of the elevator trying to get the door to get it open and one of these
men that Wharton brought in had the safety door closed and you
couldn't get out.
So the elevator went up maybe 3 or 4 or 5 times and I don't know.
But Mr. McCarty made a slight mistake. Bozzelli didn't have con-
trol of the elevator. The girl still had it then. When he was kicked
and slioved out of the elevator at the sixth floor, they let the girl
out too. I was still in there with about 6 or 7 more of the thugs in
there.
Mr. Kennedy. What did he look like when they let him out ?
Mr. Gale. He looked like a stuck pig. He was bleeding all over.
I didn't see him right tlien, because as he went out the elevator I saw
IMPROPER ACTIVITIES IN THE LABOR FIELD 7973
the side of his face, and it was blood all over him. We went down to
the bottom floor, and as we ^o out, this one here, Altamuro, he said,
"We didn't work on this bastard yet."
Evidently they had orders to'work on me. So I said, "Well, you
aren't going to work on me." Somewhere or somehow I threshed
through them and got out and ran until I got to a policeman. I de-
manded he take me to the station house until I could be able to tell
what they did to McCarty in tlie elevator.
The Chairman. Did he take you there ?
jNIr. Gale. To the station house, yes, sir.
The (yiiAiRMAN. You have told all you know about it and what you
saw ?
Mr. Gale. Yes, sir.
The Chairman. Is there anything else you can add to it ?
JNIr. Gale. I saw Whitey Kay beat up.
The Chairman. At that time or another time?
Mr. Gale. This is another time.
The Chairman. All right, tell us about that, right quick.
]Mr. Gale. It was the same thing. They did the same thing with
Kay. They picked a fight with him, and Wolgast led off and kicking
and punching at Kay.
The CiiAiRaiAN. This same crowd ?
Mr. Gale. This same gang ; yes, sir.
The Chairman. The same old gang?
Mr. Gale, More or less, you know. There are some that figure in it
all of the time, like Lentino and Altamuro. Any time there is any-
body beat up, they are there, they are sure to be there.
The Chairman. You mean these two right back of you ?
Mr. Gale. Yes, sir ; they are always there.
The Chairman. They are always in it?
Mr. Gale. Yes, sir; and Pantaleo.
]\Ir. Kennedy. Where is Pantaleo ? Is he here ?
]Mr. Gale. He is liere.
Mr. Kennedy. Could you point him out?
Mr. Gale. He is sitting back there.
The Chairman. Mr. Pantaleo, will you stand up ?
Mr. Gale. There he is.
The Chairman. Let us see you, too. Will you come around ?
You may have that other seat there, Mr. Pantaleo.
This one was in the beating up of the other man?
Mr. Gale. Well, no.
The Chairman. Let me get it straight. What is his name ? Panta-
leo?
Mr. Gale. That is right.
The Chairman. Which fray did he engage in, in the elevator or
the other man?
Mr. Gale. Jimmy Russell and Johnny Testa he beat up.
The Chairman. You saw him beating them up?
Mr. Gale. No, sir.
The Chairman. You didn't see that?
Mr. Gale. No, sir.
The Chairman. So you can't say from your own knowledge ?
Mr. Gale. Just from what I saw at the magistrate's hearing and
the disposition of the cases ; that is all.
7974 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Have you testified to all that you saw yourself?
Mr. Gale. No. I saw Whitey Kay get beat up, too.
The Chairman. You saw him?
Mr. Gale. Yes, sir.
The Chairman. Tell us about that. Did either of these three men
behind you participate in that?
Mr. Gale. Well, I just don't remember seeing Altamuro there, but
there were 5 or 6, and Lentino Avas there.
The Chairman. He is the one with the dark glasses?
Mr. Gale. Yes, he was there.
The Chairman. He was in it?
Mr. Gale. Yes, sir.
The Chairman. And he helped beat him up?
Mr. Gale. Well, they have an operation they call "Break it up and
take it outside,'' and they all get around him and hold him while the
others are punching and kicking him, and they wrestle him to the
floor and they all lean over and gang around while the boy on the
floor is getting his brains beat out.
The Chairman. I don't care just how they do it.
Mr. Gale. They do it.
The Chairman. You say they were beating him up, and you were
there when they were beating him up ?
Mr. Gale. Yes, sir.
The Chairman. And you saw the fight?
Mr. Gale. Yes, sir.
The Chairman. Did I 'understand you to say that you ran from
them and escaped, and they didn't get to beat you up ?
Mr. Gale. Yes, sir, but they will get me, and they promised to get
me.
The Chairman. They have promised to get you ?
Mr. Gale. Yes, sir, this one here.
Mr. McCarty. I have been threatened.
Mr. Gale. And I know just as sure as I sit here, Senator, they will
get me.
The Chairman. I am going to place all of you under a continuing
subpena, and I can tell all of them right now, if they threaten you or
harm you in any way, I want you to report it to this committee and
this committee will regard it as contempt of the United States Senate.
I think if they want to challenge the Government, this will be a good
opportunity for them to do it.
You report any such action to this committee.
Proceed. Is there anything further ?
You didn't tell why they beat up this last man that you were
talking about.
Mr. Gale. Well, one of our members, Mogan, was asking about
the welfare fund, and ISIr. Wharton didn't want to hear anything
about it. I think it was just Larry there that night and they didn't
want to be bothered, and as usual the gang took it upon themselves to
shut him up and quiet him.
Mr. Kay said the same thing ]Mr. McCarthy said, ""Wliy don't you
listen to him? I would like to know what is happening to the Avelfare
fund too."
So Wolgast led off and they went to work on him.
IMPROPER ACTIVITIES IN THE LABOR FIELD 7975
(Members of the Select Committee present at this point in the
proceedings were Senators McCleHan, Kennedy, Ervin, and Mundt.)
Senator MuNDT. Do these men behind yon have some office in this
local union, or are they just ordinary operating engineers?
Mr. Gale. Pantaleo is a business agent. Lentino is a master me-
chanic. The other one I don't know what he does, outside of beating
people up, and I don't know what he does.
Senator Mundt. Being a business agent and a master mechanic, that
is I suppose something which the union officers can classify to give
them better pay.
Mr. Gale. They get everything. They get the right to tell you
whether you work or whether you don't work, or where you work,
or if you work, or if you never work. This is the way it has been
all through this thing. They have everything to say.
Senator Mundt. Does a master mechanic have that authority, too ?
Mr. Gale. Positively.
Senator Mundt. He does ?
Mr. Gale. Yes, sir. They work in collusion. The master mechanics
and the business agents work in collusion. I haven't worked, I think,
but about 3 months since September of 1955, on account of this
arrangement.
Senator Mundt. These are fellows you have to have on your side
or you starve, without a job ?
Mr. Gale. Not only that, you go along with them or get starved, or
get kicked to death in some alley.
Senator Kennedy. "Why is it that you can't work? Don't the con-
tractors hire you, or is it done through the union ?
Mr. Gale. Yes, sir, I had a job. Once the contractor hired me and
I went down to go to work on the job and they had another man on it.
I asked them what was the trouble, and well, he said, "Your business
agent, Gaull, was down here," and he said, "Gaull told me that you
can't work, and I can't give you a job, and vou can't clear through
the hall."
Naturally I can't clear through the hall. It is doubtful whether I
will ever be able to clear through the hall again.
Senator Kennedy. Wasn't it found by the National Labor Rela-
tions Board that the union was discriminating as far as giving em-
ployment opportunities to those who opposed union leadership?
Mr. Gale. Yes, sir, it was in several cases.
Senator Kennedy. Now, this business agent was appointed by Mr.
Maloney, was he ?
Mr. Gale. No, Mr. Wharton brought him, when we had local au-
tonomy. He was appointed by Mr. Underwood.
Senator Kennedy. And he stayed on since then ?
Mr. Gale. Yes, sir.
Senator I^nnedy. And he has been reelected ?
Mr. Gale. No reelection, and we don't have elections, and nobody
gets elected. Mr. Maloney elects you.
Senator Kennedy. Mr. Maloney says whether you work or not, is
that not correct ?
Mr. Gale. I will tell you : Mr. Maloney says, and is, and does, what-
ever he wants to do. In other words, it was one of his own vice presi-
dents, and he has the powers of God Almighty. I don't think that
he has quite that much power, but he is pretty powerful.
7976 IMPRO'PE'R ACTIVITIES IN THE LABOR FIELD
Senator Kennedy. Mr, Chairman, if it is agreeable at the proper
time, it seems to me that it would be fair if we gave those gentlemen
over there beginning on the right, a chance to say something if they
want to say it, about the very serious charges that were made against
them, if they want to make any statement.
Would it be possible for you to ask them ?
The Chairman, I was going to try to conclude with these two,,
and just let them exchange seats.
Are there any other questions ?
All right, you two in the front row, stand and move to the rear
seats, and those in the rear seats advance to the front seats.
Will you be sworn ?
Do you and each of you, solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Lentino. I do.
Mr. Altamuro, I do.
TESTIMONY OF FEANK LENTINO AND JOSEPH ALTAMURO, ACCOM-
PANIED BY THEIR COUNSEL, GEORGE J. CHARLES
The Chairman. The witness on my left will give his name, his
place of residence, and his business or occupation.
Mr. Altamuro. Joseph Altamuro, 1844 South Chadwick Avenue,
Philadelphia, Pa, Apprentice in the operating engineers. That is
considered an "A" book.
The Chairman. And what is your name, please ?
Mr, Lentino, Frank Lentino, 1831 South Camac Street, Phila-
delphia.
The Chairman. What is your occupation ?
Mr, Lentino, Operating engineer.
The Chairman, You are an operating engineer?
Mr. Lentino. Yes, sir.
The Chairman. I will address the one on my left here.
You have heard the testimony of the two witnesses who have just
left the witness stand. Before 1 ask, you do have counsel represent-
ing you?
Counsel, identify yourself for the record.
Mr. Charles. George J. Charles, member of the bar of the District
of Columbia, with offices at 1025 Connecticut Avenue.
The Chairman. Thank you, Mr. Charles.
Now, the witness on my left, I will address this question to you:
You have heard the testimony of the witnesses who just preceded
you on the stand with reference to your participation in an assault
upon Mr. McCarty.
You heard the details of it. Do you wish to make any statement
about it ?
Mr. Altamuro. Yes, I would like to clarify a few points. Half of
it is a bunch of lies.
The Chairman, Just half of it ? Did you say half of it is a bunch
of lies?
Mr. Altamuro. And maybe 80 percent of it.
The Chairman, Well, what part of it is a lie ?
IMPROPEiR ACrrViriES IN THE LABOR FTEI/D 7977
Mr. Altamuro. Well, to start off with, they made the first attempt.
When we walked in the elevator they said, "Here they come; get
ready."
The Chairman. Let us have order.
Mr. Altamuro. And Mr. Norman Gale had something wrapped up
in a newspaper and it was a shiny instrument. So when McCarty
put up his hand to hit me, I put mine up and the first thing it turned
out to be a free-for-all.
The Chairman. They were leaving, were they not, and they got in
the elevator first ?
Mr. Altamuro. Then we got in the elevator.
The Chairman. You were chasing them ; were you not ?
Mr. Altamuro. No, sir.
The Chairman. You were after them.
Mr. Altamuro. We were just going out together.
The Chairman. "\Yliat is that? Can you give any reason why Mc-
Carty would want to attack you '( He had not attacked you there in
the liall and he was leaving.
]Mr. Altamuro. He didn't have no Avords with me.
The Chairman. You did not have any words with him ?
Mr. Altamuro. No, sir.
The Chairman. There was no reason at all for a fight, was there ?
Mr. Altamuro. No.
The Chairman. All right. What is your statement ?
Mr. Lentino. I wouktlike to clarify one thing, please, I was ac-
cused of being a murderer and I am not a murderer.
The Chairman. I am not making that charge against you and I do
not know.
Senator Mundt. You were accused of being a stickup man. xlre
you a stickup man ?
Mr. Lentino. After the facts were presented to tlie governor, I re-
ceived a full pardon.
Senator Mundt. I did not ask you if you were pardoned.
Mr. Lentino. I was accused of robbing a gambling establishment,
after I was fleeced, and I was pardoned by the governor.
Senator Mundi\ Were you convicted ?
Mr. Lentino. I was convicted, yes, but within 48 hours without
counsel.
Senator Mundt. How long did you serve before you were par-
doned ?
Mr. Lentino. Off-liand, I would say about 33 or 34 months before
the case was brought before the governor.
Senator Mundt. Thirty-three or thirty-four months?
Mr. Lentino. Yes, sir.
The Chairman. What year was that ?
Mr. Lentino. I believe it was in 1938, sir.
The Chairman. That is when you were sentenced and you served
2 or 3 years of the time ?
Mr. Lentino. Yes, sir. IX was in Atlantic City, a gambling estab-
lishment.
The Chairman. All right, proceed. Is there anything else you want
to clear up ^
Mr. Lentino. Yes. I have been accused of assault. That is not a
true statement, sir.
7978 IMPROPER ACTIVITIES IX THE L.\BOR FIELD
The Chaiemax. Were you fined for the assault on McCarty ?
Mr. Lextixo. What is that, sir ?
The Chairmax. Were you fined for an assault on McCaity?
Mr. Lextixo. Yes, I was.
The Chairmax. Who paid your fine ?
Mr. Lextixo. To this day, I don't know.
The Chairmax. You mean you do not know who paid your fine?
Mr. Lextixo. Xo. The law^-er has never questioned nie about it
since.
The Chair:max. The lawyer has not questioned you about it. You
know your fine was paid.
Mr. Lextixo. That I don't know.
The Chairmax. You do not even know whether you still owe your
fine or not ?
Mr. Lextixo. I don't know, sir.
The Chairmax. Do you not know the union has paid it?
Mr. Lextixo. I don't know, sir.
The Chairmax. Who paid your lawyer ^
Mr. Lextixo. I don't know, sir.
The Chairmax, You did not pay him.
Mr. Lextixo. No. I am waiting for a receipt.
The Chairmax. Well, you will not get a receipt until you pay it;
•ill
vou
]Mr. Lextixo. That was my error.
The Chair:max. That was your error ?
Mr. Lextixo. I am waiting for a bill.
The Chairmax. You are waiting for a bill ?
Mr. Lextixo. Yes, sir.
The Chairmax. You never have gotten a bill from tlie lawyer or
the court that fined you ?
Mr. Lextixo. Yes, sir.
The Chairmax. Is that correct?
Mr. Lextixo. Yes, sir; that is correct.
The Chairmax. Hoav long ago has it been ?
Mr. Lextixo. I believe it was in 1051 and I may be Avrong.
The Chairmax. In 1954. Assuming it was some 2 or .3 years ago ?'
Mr. Lextixo. Yes, sir.
The Chairmax. Xearly 4 years ago, ratlier ?
Mr. Lextixo. Yes.
The Chairmax. Is that correct ^
Mr. Lextixo. It must be so.
The CiiAiRMAX. Have you had no curiosit}' about it to find out
whether you owed anything '.
Mr. Lextixo. I forgot about it.
The Chairmax. You ha^-e been reminded of it today?
Mr. Lextixo. Yes, sir, and may I also bring something else to your
attention, please?
Tlie Chairmax. Yes.
Mr. Lextixo. He accused — that is my error again — Mr. McCarty
has stated he was viciously beaten about the face. I also have a
photograph of Mr. McCarty at the maofistrate's hearing.
The Chairmax. When was that held ?
Mr. Lextixo. In Philadelphia, sir.
The Chairmax. When ?
IMPROPER ACTIVrTIES IN THE LABOR FIELD 7979
Mr. Lentino. I don't recall the date, sir. One minute, please. The
date is right here.
It was Tuesday, March 10.
The Chairman. The beating occurred on the Hd, I believe ; is that
right?
Mr. Lentino. I don't know for sure.
The Chairman. That would be 1 week later, would it not ?
Mr. Lentino. It would then be, if it was the 3d ; yes, sir.
The Chairman. That has been the testimony, and do you state it
was not on the 3d ?
Mr. Lentino. If that is the testimony, it was on the 3d, and I am
not questioning the date at all.
The Chairman. I am just trying to see if there is any discrepancy
in the date ; so your picture, or whatever you have there, was the 10th ;
is that correct ?
Mr. Lentino. Yes, sir.
The Chairman. Do you want to show us the picture ?
Mr. Lentino. I would like to, sir.
The Chairman. Let us see it.
(A document was handed to the chairman.)
Senator Mundt. While you are looking at the picture, I would like
to ask the other witness whether he paid his $200 fine, and if not, w^ho
paid it?
Mr. Altamuro. I wouldn't know, sir.
Senator Mundt. Did you pay it ?
Mr. Altamuro. No, sir.
Senator Mundt. Did you pay your lawyer's fee ?
Mr. Altamuro. No, sir.
Senator Mundt. Who was your lavryer?
Mr. Altamuro. Thomas McBride.
Senator Mundt. Is he a union lawyer?
Mr. Altamuro. I wouldn't know, sir.
Senator Mundt. But you never paid him, and you never paid the
fine?
Mr. Altamuro. I did not.
Senator Mundt. Do you know who did ?
Mr. Altamuro. I wouldn't know.
Senator Mundt. Do you have any idea ?
Mr. Altamuro. I wouldn't know:
Senator Kennedy. Is he the union lawyer, did you say ?
Mr. Altamuro. I wouldn't know if he was.
Senator Kennedy. How did you happen to get him ?
Mr. Altamuro. He just met us at the magistrate's courtroom.
Senator Kennedy. Did you plan to have a lawyer ?
Mr. Altamuro. Yes, sir.
Senator Ken nedy. You did not know McBride was coming ?
Mr. Altamuro. I didn't know at the time.
Senator Kennedy. Who did you think was coming?
Mr. Altamuro. I knew a lawyer was going to be there.
Senator Kennedy. Who told you?
Mr. Altamuro. Nobody told me. I just imagined.
Senator Kennedy. Did you not feel any obligation to get yourself
a lawyer to represent you in court?
Mr. Altamuro, Yes, sir.
7980 IMPROPER ACTIVITIES IN" THE LABOR FIELD
Senator Kennedy. Wliy did you not get one ?
The Chaibman. You knew the union was getting you a lawyer;
did you not ?
Mr. Altamuro. No ; I did not.
The Chairman. You never heard of it ?
Mr. Altamuro. No, sir.
The Chairman. You never heard of it since ?
Mr. Altamuro. No, sir.
The Chairman. Do you not knoAV it is a fact ?
Mr. Altamuro. No, sir.
The Chairman. Did you not know it then and do you not know
it now ?
Mr. Altamuro. No, sir.
The Chairman. You just imagined that the lawyer would show up
and one did?
j\Ir. Altamuro. I imagine.
The Chairman. Do you think anybody believes that statement?
Anybody ? You do not believe it yourself, do you ?
Mr. Altamuro. Oh, yes ; I do.
Senator Mundt. How about the other witness: Do you have a
better idea how you got your lawyer or did you just imagine one
would come?
Mr. Lentino. I have no idea.
Senator Mundt. You had no idea who was going to represent you ?
Mr. Lentino. I do know I had representation, and I had many
friends and he probably came from that source.
Senator Mundt. Who was the lawyer representing you; Mr.
McBride?
Mr. Lentino. Yes, sir.
Senator Mundt. You did not ask him to come ?
Mr. Lentino. No, sir.
Senator Mundt. He just showed. up?
Mr. Lentino. That is correct.
Senator Mundt. Were, you surprised or shocked to find you had a
lawyer ?
Mr. Lentino. Yes ; one as brilliant as McBride ; yes.
Senator Mundt. Is he the union lawyer ?
Mr. Lentino. He is not the union's lawyer.
Senator Mundt. And you do not know where he came from ?
Mr. Lentino. No, sir.
Senator Mundt. You do not know who asked him to come?
Mr. Lentino. No, sir.
Senator Mundt. But he was there.
Mr. Charles. If I may, I would like to say that in convei-sations
we had earlier, I asked the witnesses to try to relate to the committee
all the facts that they had of their own personal knowledge and tell
the truth as they understood the situation.
It may be that both of these gentlemen are being perhaps over-
zealous in answering your questions concerning this particular point,
but if they seem rather dogmatic in their insistence that they do not
know it is because I cautioned them to tell the committee what they
know of their own personal knowledge.
The Chairman. That is very commendable of you, to tell the wit-
nesses to tell the truth and to tell all they know. As to whether they
IJVIPROPER ACTIVrriES IN THE LABOR FIELD 7981
are overzealous or not, being an attorney you Imow we can weigh
their demeanor while they are on the witness stand and also, the
knowledge that they should have, and the knowledge that they maybe
could not have had. We can take all of those things into account.
I have no objection if you desire to make this picture an exhibit
along with the others. It may be made exhibit No. 78.
(The document referred to was marked "Exhibit No. 78" for refer-
ence and may be found in the files of the select committee.)
Senator Ivennedy. Are you presenting this picture in order to
attempt to indicate that he was not beaten up ? What is the purpose
of that?
Mr. Lentino. He is not beaten up. It was a case of mercurochrome.
Senator Kennedy. Mr. McCarty has stated under oath that he lost
his teeth within a month after the beating, all of them.
Mr. Lentino. I have no knowledge of that.
Senator Kennedy. Well, where is he?
]\Ir. McCarty, did you say you lost your teeth within a month after
the beating ?
Mr. McCarty. Yes, sir.
Senator Kennedy. Had you had trouble with your teeth before you
were beaten up ?
Mr. McCarty. No, sir.
Senator Ivennedy. Is it possible to take all of your teeth out now,
and they are all false.
Mr. McCarty. I have no teeth whatsoever.
Senator Kennedy. You do not even have false teeth ?
Mr. McCarty. No, sir.
Senator Kennedy. Do you see that Mr. McCarty has no teeth?
Mr. Lentino. If he has them out, he hasn't any teeth.
Senator Kennedy. You know he does not have any ?
Mr. Lentino. Now.
Senator Kennedy. You know he does not have them ?
Mr. Lentino. Yes.
Senator Kennedy. Does that affect your opinion at all ?
Mr. Lentino. I had nothing to do with. striking Mr. McCarty on
the face.
Senator Kennedy. What part of the body did you strike ?
Mr. Lentino. I didn't strike any, sir.
Senator Kennedy. Were you sentenced for striking him, and were
you fined ?
Mr. Lentino. I was fined ; yes, sir.
Senator Kennedy. Were you found guilty ?
Mr. Lentino. I was.
Senator Kennedy. How many of you went into the elevator when
Mr. McCarty went in there ?
Mr. Lentino. I wouldn't know, sir.
Senator Kennedy. Were there 2 or 3, would you tell me, or were
there 5 of you ?
Mr. Lentino. There were quite a few.
Senator Kennedy. Quite a few of you went in together ?
Mr. Lentino. I went in with a friend of mine, just two of us.
Senator Kennedy. How many people were in there with Mr.
McCarty?
21243— 58— pt. 20 5
7982 IMPROPER ACTIVITIES IX THE LABOR FIELD
Mr, Lentino. I wouldn't know.
Senator Kennedy. Who was it ? Was it your friend who said that
McCarty said, "Look out, here they come. Get ready" ?
Mr, Altamuro. Yes, sir.
Senator Kennedy. How many were in the elevator at tlie time with
McCarty ?
Mr. Altamuro. I would say about 6 or 7.
Senator Kennedy. That were standing in the elevator with Mc-
Carty?
Mr. Altamuro. Yes, sir.
Senator Kennedy. And then 6 or 7 of you came in ?
Mr. Altamuro. I didn't know about that.
Senator Kennedy. You would not know about that. Who were
the other people with McCarty ?
Mr. Altamuro. The only one I could remember to the best of my
knowledge was Norman Gale and a couple more I didn't know.
Senator Kennedy. There were 6 or 7 of you who were named as
having been in the elevator by Mr. McCarty and you say McCarty
was in there with 6 or 7 and you can name only one of them and yet
they were members of the same union ?
Mr. Altamuro. We have 4,600 members and you can't remember
every name.
Senator Kennedy. You could not remember any of them ?
Mr. Altamuro. That is right.
Senator Kennedy. You did not know any of the 6 or 7 m there with
McCarty?
Mr. Lentino. No, sir, at thsit time.
Senator Kennedy. Did you bring out their names in court ?
Mr. Lentino. No, I did not.
Senator Kennedy. I would like, if it is agreeable, to ask Mr. Mc-
Carty how many people were with him in the elevator.
Mr. McCarty. Mr. Gale was with me.
Senator Kennedy. And the girl running the elevator ?
Mr. McCarty. Yes, and a man from the upper floor.
Senator Kennedy. It seems .to me the testimony is in complete con-
flict there. Why did you get in that elevator ?
Mr. Lentino, I had intentions of going home.
Senator Kennedy. I would like to ask one question of the attorney
without reflecting on him in any way.
Who secured your services ?
Mr. Charles. I am representing these gentlemen here individually,
sir, personally, and I am not representing the union.
Senator Kennedy. Were you secured by the union attorney?
Mr. Charles. I was recommended to these gentlemen, but I am not
associated with the union.
Senator Kennedy. But the union's attorney recommended you?
Mr. Charles. The union's attorney approached me and told me that
these gentlemen had asked him to obtain local counsel.
Senator Kennedy. And your fee will be paid by them?
Mr. Charles. I presume so. We have not had an opportunity to
discuss that. These people were subpenaed and they came in today
and we really have not had a chance because they came down here to
register and we were in the office until about 1 : 30 and we went to
lunch and we came directly here.
IMPROPER ACTIVITIES IN THE LABOR FIELD 7983
Senator Ivennedy. Who approached you ?
Mr. Charles. Mr. Walh
Senator Kennedy. Who is he?
Mr. Charles. He is the general counsel of the international.
Senator Ervin. Mr. Chairman, I would like to ask Mr. Lentino
some questions.
Here is your evidence as I understand it: On April 10, 1938, you
were sentenced to a term of from 10 to 12 years in tlie State prison in
Trenton, N. J., upon tlie charge of robbery by holdup at the point
of a gun.
Mr. Lentino. Yes, sir.
Senator Ervin. Although you were absolutely innocent?
Mr. Lentino. No, I didn't say that.
Senator Ervin. You said you were innocent.
Mr. Lentino. I am sorry to differ with you, but these are the facts :
I was fleeced in a gambling establishment, and made the foolish mis-
take of taking the law into my own hands and I regret it. I was sen-
tenced within 48 hours without counsel and without even speaking to
my own family.
Senator Ervin. Let me see if I understand you now. You had been
in a gambling establishment?
Mr. Lentino. At Atlantic City which was wide open at that time.
Senator ER^^N. You had lost some money in the gambling estab-
lislmient and you took a pistol and held up the man that yon had
been gambling with ?
Mr. Lentino. One moment, sir. I was fleeced and if I may add,
beaten. I returned later and I made the error of going back to retake
my money.
May I point out, sir, that I only took what I lost and left the other
money behind.
Senator Ervin. You took it from exactly the same man who got it
from you ?
Mr. Lentino. It was a gambling establishment and I took it from
the cashier's office.
Senator ER\aN. In other words, you went in the gambling establish-
ment and you gambled ?
Mr. Lentino. That's correct.
Senator Ervin. And you lost your money ?
Mr. Lentino. I was fleeced, sir.
Senator Ervin. I do not care whether you were fleeced. You were
separated from your money in the gambling establishment ?
Mr. Lentino. That is correct as far as that is concerned.
Senator Ervin. Then you went out and you got your pistol and you
came back in and held up the cashier ?
Mr. Lentino. It is a matter of record ; it was a broken gun.
Senator Ervin. I do not care whether it was broken or not. You
did not tell the man you were holding up it was broken, did you ?
Mr. Lentino. No, I told him I wanted my money back, and I was
beaten for it.
Senator Ervin. At the point of that pistol, you took back from the
cashier of the gambling establishment, money, did you not?
Mr. Lentino. I certainly do not condone what I did.
7984 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Eevin. And it was not the same money that was taken away
from you and the man you held up was not the same man that took
your money ; was he ?
Mr. Lentino. It was the people who were working in the establish-
ment.
Senator Ervin. Well, and the question though, the man that you
held up
Mr. Lentino. Sir, I am not an attorney and I am a layman. I try
to do the best I can.
Senator Ervin. That has nothing to do with the law. A layman
can tell the facts provided he has enough devotion to the truth.
Mr. Lentino. I want to tell nothing but the truth.
Senator Ervin. You went into the gambling establishment and you
were separated from your money?
Mr. Lentino. May I say this, sir, that at that time I had a flower
shop and it was the week before Easter.
Senator Ervin. I do not care about your flower shop.
Mr. Lentino. If you want the fact, one leads into the other. It
was a week before Palm Sunday and it is customary on Palm Sunday
or Easter to buy plants. I had $600 and some dollars. I was going
into the market up in Philadelphia. I stopped at this place.
Senator Ervin. This does not have a thing to do with New Jersey ;
the holdup.
Mr. Lentino. I am telling you what I did. I stopped in this place,
this gambling establishment, to place a couple of bets, but it is a
lengthy story. Shall I go into it? It is lengthy, but I can say this,
and I say in all sincerity that I was cheated out of my money and I
tried to retake my money.
Senator Ervin. In what kind of a game were you cheated out of
your money ?
Mr. Lentino. Dice, sir. There was an old man which I will always
remember.
Senator Ervin. How do you know you were cheated out of your
money instead of losing it in a fair "crap-shooting" game ?
Mr. Lentino. I was told by an old man, which I will always remem-
ber, a man with silver gray hair, who came to me and he said, "Son,
don't make the foolish mistake tliat I made. You have been fleeced.
You can observe," and I did. And, after observing
Senator Ervin. How much money did you get back at the point of
the gun ?
Mr. Lentino. Exactly what I lost, sir.
Senator Ervin. How much was it ?
Mr. Lentino. Not a penny more.
Senator Ervin. How much was it ?
Mr. Lentino. Six-hundred-and-some-odd dollars, and I left some-
thing like $4,500 behind.
Senator Ervin. Did you tell the judge that you were just taking
back your own money ?
Mr. Lentino. I did, sir.
Senator ER\aN. Were you tried by a jury ?
Mr. Lentino. No ; I was not.
Senator Ervin. Anyway, the judge heard your tale ?
IMPROPER ACnVITIES IN THE LABOR FIELD 7985
Mr. Lentino. I was told this ; that, if I pleaded guilty, being a first
offender, I would be given consideration and, if 1 save the cost of a
trial, I will get a break, and I was given 10 to 12 years as a first
offender. Then, some social worker took an interest in the case and
brought it to the attention of the Governor, and I was given a full and
free pardon, and I also served in the Armed Forces. I served my
penalty, and I still do not want to continue serving it.
Senator Ervin. You told the judge your tale there in the courtroom,
did you not ?
Mr. Lentino. Wliat is that, sir ?
Senator Ervin. You told your tale to the judge in the courtroom, did
you not, when you were tried ?
Mr. Lentino. Yes, sir ; that is right.
Senator ER\^N. And the judge that heard your tale sentenced you to
10 to 12 years in the State prison ?
Mr. Lentino. That is right.
Senator Ervin. And you served 3 years of that sentence, until you
became eligible for parole ?
Mr. Lentino. And then a pardon.
Senator Ervin. And you were pardoned ?
Mr. Lentino. A full pardon.
Senator Ervin. A full pardon ?
Mr. Lentino. Yes, sir.
Senator Ervin. When did you get out?
Mr. Lentino. Thirty-three months later.
Senator Ervin. What month was it that you got out ?
Mr. Lentino. I don't recall now, and I am very poor in remember-
ing dates.
Senator Erv^n. Well then, you were tried, and there were about
seven of you who followed McCarty into the elevator, did you not?
Mr. Lentino. No ; I did not follow anyone in the elevator.
Senator Ervin. Did you go in the elevator first ?
Mr. Lentino. No, sir.
Senator Ervin. Did you go into the elevator after McCarty went
in?
Mr. Lentino. Yes, sir, if you want the facts, and not after him. I
went into the elevator with the intentions of going down into the
lobby and going home.
Senator Ervin. How many men went with you? You knew this
man right there was with you ?
Mr. Lentino. No ; of course not.
Senator Ervin. Do you know him?
Mr. Lentino. Certainly, I know him.
Senator Ervin. And you were taken and tried in court in Phila-
delpliia, were you not ?
Mr. Lentino. No ; Atlantic City. May I say this, also
Senator Ervin. I am talking about this last fight. Was it in
Atlantic City or Philadelphia?
Mr. Lentino. The city of Atlantic City saw fit to go into another
county to obtain a judge to sentence me within 48 hours.
Senator Ervin. Do you mean there was some corruption in getting
a judge that did not belong there ?
7986 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Lentino. It is not customary to be sentenced without bail and
without a preliminary hearing.
Senator Ervin. I have left the Atlantic City incident, and I am
talking about the one in Philadelphia.
Mr. Lentino. I am sorry, sir.
Senator Ervin. You are swearing to us that, although you were
absolutely innocent, and you did not participate in it, you were con-
victed in the court in Philadelphia of an aggravated assault and
battery ?
Mr. Lentino. Those things happen, sir.
Senator Ervin. And you swear to us that you were absolutely inno-
cent and did not participate in it and had nothing to do with it?
Mr. Lentino. I was in there and hell broke loose, but I had nothing
to do with it.
Senator Erat:n. And the judge who tried you had a different opinion,
did he not?
Mr. Lentino. He did, sir. He was a distinguished judge.
Senator Ervin. Now, there was a lawyer who walked in that you
did not know, and you had made no arrangements for him to come, and
nobody else had made any arrangements, so far as you know, for
him to come, and he just walked in and defended you in this case.
Mr. Lentino. That is right, sir.
Senator Ervtn. And you had never seen him before, and you did
not even inquire of him why he was interested in your case ?
Mr. Lentino. No, sir.
Senator Ervin. And you never inquired, or did he tell you he was
going to defend you ?
Mr. Lentino. I tried to ask, but the case was over, and I did not
see him since.
Senator Ervin. When he came in to take charge of your case, did
he tell you that he was going to defend you ?
Mr. Lentino. Yes, sir.
Senator Er\tn. Did you have enough curiosity to ask him why this
great kindness on his part ?
Mr. Lentino. He said he was sent in by some friends.
Senator Ervin. Sent in by some friends ?
Mr. Lentino. Yes, sir.
Senator Ervin. There you were charged with a violation of criminal
law, and a lawyer comes in and tells you that he was sent in by some
friends to defend you, and you did not even have enough gratitude
of those friends to try to ascertain their identity to ask him who they
were ?
Mr. Lentino, Perhaps that is my fault for not doing so.
Senator Ervin. I would think so. If some friends send a lawyer
in to defend me, I want to know who the friends are that I owe the
gratitude to.
You further say that your fine was paid by somebody, and you did
not have enough curiosity to find out who paid the fine ?
Mr. Lentino. That is correct.
Senator Ervin. Are you swearing that you do not know that the
union paid your fine ?
Mr. Lentino. If they did, I don't know.
IMPROPER ACTIVITIES IK THE LABOR FIELD 7987
Senator Er\^n. You liave not the slightest idea Avho paid your
fine?
Mr. Lentino. Correct, sir ; not at this time.
Senator Ervin. You have not the slightest idea who retained the
lawyer who defended you ?
Mr. Lentino. I have no recollection who paid the fine.
Senator Ervin. And you are just as much satisfied with the truth
of your statement that you are absolutely innocent, when convicted
in the Philadelphia court, as you are about anything that you testified
to here ?
Mr. Lentino. It was the judge's opinion that I was guilty.
Senator Ervin. But you were absolutely innocent ?
Mr. Lentino. I feel I am innocent; yes. I was into an innocent
brawl. May I say this. Your Honor, please, Mr. Chairman: A real
stanch supporter of this Underwood group has stated in the presence
of other people that many of the witnesses did nothing but lie. I
would like to submit the name, and I would like this man to be
questioned. He did so on two different occasions; during the court
allegations in Philadelphia, after a court decision
The Chairman. Let me see if I understand you. You heard that
somebody said in the Underwood group that a lot of the witnesses lied ?
Mr. Lentino. I was present when he said it in the presence of
others. He made an admission in my presence.
The Chairman. What is his name ?
Mr. Lentino. Michael Concordia.
The Chairman. Was he there?
Mr. Lentino. He is not present ; no, sir.
The Chairman. Was he there at the fight ?
Mr. Lentino. What was that, sir ?
The Chairman. Was he there at the fight ?
Mr. Lentino. No ; he was a witness for Underwood, for his group.
The Chairman. In what case ?
Mr. Lentino. In the case in Philadelphia, which some of the wit-
nesses are appearing here today from.
The Chairman. Do you mean in the case against you ?
Mr. Lentino. Against the international, but I was mentioned about
doing these things.
The Chairman. That is some civil suit ?
Mr. Lentino. Yes. May I say this : Only last night he said in the
presence of others that they were only seeking revenge now, that they
have been lying.
Mr. Kennedy. How could they say they had been lying before they
appeared ?
Mr. Lentino. Because he feels they are going to say exactly what
they said in the previous hearing.
Mr. Kennedy. Have you been arrested any other time ?
Mr. Lentino. Yes.
Mr. Kennedy. How many times have you been arrested ?
Mr. Lentino. I think it was twice, if I am not mistaken.
Mr. Ivennedy. 1934 for setting up and maintaining an illegal lot-
tery?
Mr. Lentino. I was arrested and found not guilty.
Mr. Kennedy. But some judge found you not guilty.
7988 IMPROPER ACTIVITIES IN THE, LABOR FIELD
Mr. Lentino. Doesn't that apply to the judge that found me not
guilty?
Mr. Kennedy. Yes. Some judge found you not guilty. That was
setting up and maintaining an illegal lottery. In 1938, you got fleeced,
as you say, by an innocent fellow that came by and started gambling,
and you were fleeced ?
Mr. Lentino. People of the establishment fleeced me.
Mr. Kennedy. Have you been arrested any other time? Tell us
the year you were pardoned. You went to jail in 1938.
Mr. Lentino. My pardon is right here, a photostatic copy ; 1950.
Mr. I^JENNEDY. I think the impression that you were trying to give
the committee was that in 1938 you were arrested, you spent 34 months
in jail, and along came the Governor and found out how badly you
had been treated, so he gave you a pardon, 34 months later, when in
fact, you were not pardoned until 12 years later.
Mr. Lentino. There was a lot of investigation going on.
Mr. Kennedy. A lot of people get pardoned 10 or 12 years after
the crime is committed. That is not the impression that the committee
got. Could we see the pardon ?
Mr. Lentino. Certainly.
Senator Mundt. Were you pardoned from serving the full term in
the penitentiary? How long did you actually stay in the peniten-
tiary ?
Mr. Lentino. About 33 months.
Senator Mundt. At that time, you were not pardoned; you were
paroled ?
Mr. Lentino. I was paroled ; yes, sir.
Senator Mundt. I thought from your previous testimony you told
me you were pardoned and let out of the penitentiary after 33
months.
Mr. Lentino. No ; I am sorry if I gave that impression.
Senator Mundt. That is the impression I got.
Mr. Kennedy. You were arrested for illegal lottery in 1934 and
robbery in 1938. Were you arrested again ?
Mr. Lentino. What xear ?
Mr. Kennedy. After 1938.
Mr. Lentino. I believe I was arrested later.
Mr. Kennedy. 1936 for pool selling and conspiracy, is that right?
Mr. Lentino. Yes.
Mr. Kjjnnedy. Wliat happened on that ?
Mr. Lentino. I was fined, I believe.
Mr. Kennedy. 1949, setting up and maintaining an illegal lottery ;
1948, Marcus Hook, Pa., pool selling and conspiracy, July 23, 1948.
Then August 10, 1949, setting up and maintaining an illegal lottery,
for which you were found guilty ?
Mr. Lentino. In Marcus Hook ?
Mr. Kennedy. No. I do not know where this was.
Mr. Lentino. I was only found guilty once.
Mr. Kennedy. Then you were arrested on the other, pool selling
and conspiracy, and you were found guilty in 1949 and fined for set-
ting up and maintaining an illegal lottery. You have had a rather
interesting background, which you were not telling to the members
IMPROPER ACTIVITIES IN THE LABOR FIELD 7989
of the committee when you were answering these questions, and you
were telling about the innocent man that went in and was fleeced.
Mr. Lentino. I was fleeced, sir.
Mr. I^NNEDY. Yes.
Senator Ervin. I would like to ask some other questions.
As a matter of fact, you served 3 years of a lO-to-12-year sentence,
did you not ?
Mr. Lentino. Close to 3 years.
Senator Ervin. Then you were admitted to parole, were you not?
Mr. Lentino. I was, sir.
Senator Ervin. And you remained on parole for 7 years after that?
Mr. Lentino. Yes, sir.
Senator Ervin. ^Vnd, instead of the Governor granting you a par-
don on the recommendation of some social-minded people, he granted
you a pardon on a recommendation of the State board of parole,
which had been supervising your conduct for the 7 years preceding
that time, did he not ?
Mr. Lentino. I believe that is self-explanatory.
Senator ER^^:N. And he did it pursuant to the laws of New Jersey,
which provided that where a man is on parole and does not get into
trouble during the period of his parole, until his original term has
expired, he is entitled to a pardon as a matter of law, is that not so ?
Mr. Lentino. I thought it was due to the circumstances involved
in the crime.
Senator Ervin. It says it is on the motion of the parole officer, and
that the Governor also reserves the right to revoke the pardon at any
time.
You tried to make the committee believe that you were pardoned
and released at the end of 3 years.
Mr. Lentino. I am sorry if I created that impression.
Senator Erm:n. And that that was because of extenuating cir-
cumstances, brought to the attention of the Governor by some chari-
table-minded people that had gotten interested in your case.
Mr. Lentino. It was my opinion that that is why I was pardoned,
due to the fact that I had no coimsel in court when I was sentenced,
and due to the fact that it was a gambling establishment and I was
fleeced.
Senator Ervin. Would you explain why it was 7 years after the
Governor discovered that fact, before he was willing to jDardon you ?
Mr. Lentino. I don't know how they operate, sir.
Senator Er\^n. That is all.
The Chairman. Call the names of the four witnesses.
Mr. Kennedy. Mr. Chairman, we have this one other document
regarding the beating of Mr. Testa, where it states in the document
from the court :
We understand that both parties have agreed to withdraw charges against
each other. It appears that Magistrate Vignolla unfortunately has already
held the defendants Pantaleo, Ferrari, and Altamuro for court.
This is the important paragraph :
It is, also, understood that defendants Pantaleo, Ferrari, and Altamuro wiU
refrain from committting any further assaults upon any of the members of the
Operating Engineers, and that they further agree to pay the medical expenses
of John Testa in connection with the recent incident on March 26, 1954,
7990 IMPROPER ACTIVITIES IN THE LABOR FIELD
That was another man that was beaten up, in which Mr. Altamuro
participated, and Mr. Pantaleo.
The Chairman. Are there any further questions ?
Mr. Charles. Mr. Chairman, may I interrupt for a moment,
please ?
There were certain references made to goon squads and thugs and
so forth by the witnesses in prior testimony. I was just wondering
whether the committee might care to interrogate these two gentle-
men as to how long they had been members of the union, what status
they have in the union, and under whose administration this status
was granted to them, and as to whether they actually worked as
operating engineers.
I think it would be of some interest.
The Chairman. Tliey may make any statement along that line.
Mr. Lentino. I have been a member of the Operating Engineers
since 1940. I was elected auditor under the Underwood adminis-
tration in 1948.
The Chairman. Elected what?
Mr. Lentino. Auditor.
The Chairman. Orderly?
Mr. Lentino. Auditor. In 1948.
In addition to that, I was picked by Mr. Underwood as a member
of his executive board.
The Chairman. All right.
Do you have any statement?
Mr. Altamuro. I have only been in the local 6 years, sir.
The Chairman. You have been what ?
Mr. Altamuro. I have been in the local, it will be 6 j^ears.
The Chairman. You have been in the local for 6 years ?
Mr. Altamuro. Yes, sir.
The Chairman. Do you have a further statement?
Mr. Altamuro. No, sir.
The Chairman. Do you work as an operating engineer ?
Mr. Altamuro. I work as an apprentice. I do whatever jobs I
can do.
The Chairman. Have you any further questions ?
Senator Goldwater. I have one question, Mr. Chairman.
Mr. Lentino, did you say you joined the union in 1940?
Mr. Lentino. It could have been 1941.
Senator Goldwater. Were you not in jail in 1940 ?
Mr. Lentino. Then it is 1941, that is for sure. I was only out of
jail 2 or 3 weeks when my father got me into the Operating Engi-
neers,
Mr. Kennedy. He was in jail in 1941.
Senator Goldwater. I wondered how you joined the union if you
were in jail.
That is all, Mr. Chairman.
Senator Mundt. Is it your testimony, Mr. Lentino, that you did
not strike at any time Mr. McCarty while l^e was in the elevator?
Mr. Lentino. The only thing I tried to do in there was to get out.
Senator Mundt. Answer my question.
Is it your testimony that you did not at any time strike him ?
Mr. Lentino. I did not, sir.
IMPROPER ACTIVITIES IN TiiE Lu\BOR FIELD 7991
Senator Mundt. Or kick him?
Mr. Lentino. I did not, sir.
Senator Mundt. Or bite him ?
Mr. Lentino. No, sir.
Senator Mundt. How about the other gentleman ?
Mr. Altamuro, is it your testimony that at no time did you strike
Mr. McCarty ?
Mr. Altamuro. I will tell you the truth, I didn't get no time to
strike him because he got my lingers and he bent them backward.
Senator Mundt. Do you mean when you tried to gouge his eyes
out, he grabbed your fingers ?
]Mr. Altamuro. That is what he says. He got my fingers and bent
them back this way [indicating].
Senator Mundt. That jibes with his testimony.
All right.
The Chairman. These witnesses last on the witness stand, Alta-
muro, Lentino, McCarty, and Gale
Mr. Lentino. May I say this : During this thing, I threw a few
blows, but I didn't know who I was hitting. I wanted to get out.
The Chairman. I am sure you did.
Senator Mundt. You might have hit McCarty, then? You could
have done it ?
Mr. Lentino. If I did, I wasn't directing my blows to Mr. Mc-
Carty. It was whoever was in my way.
Senator INIundt. He is a big target.
The ChairMxVn. You four witnesses are placed under recognizance
to reappear before this committee at any time that it may desire
further testimony from you. You will remain under your same sub-
pena, subject to notice by the committee, giving you reasonable notice
of the time and place where it will desire to hear you. Therefore,
you are under the jurisdiction of the committee.
Any act of Violence upon you, any threat, any tlireat to your se-
curity, that would tend to intimidate or coerce you with respect to
your testimony here and the further testimony that you may give
when you will be recalled, I insist that you report, I order and direct
yoi} to report it, to this committee. If such is reported, and estab-
lishes a fact, this committee will so act.
It is my judgment that an}- such action would be in contempt of
the United States Senate and defying the authority of tlie Govern-
ment of the United States.
You may stand aside. The other witnesses will appear tomorrow.
You are excused for the present under this recognizance.
This room will not be available to this committee tomorrow.
Therefore, we will have to move our session to another room. That
will be room 457 at 10 : 30 in the morning.
(Whereupon, at 5 : 15 p. m. the committee recessed, to reconvene
at 10 : 30 a. m., Tuesday, January 28, 1958. Members present at the
taking of the recess were: Senators McClellan, Mundt, Ervin, and
Goldwater.)
INVESTIGATION OF OIPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
TUESDAY, JANUABY 28, 1958
United States Senate,
Select Committee on Improper Activities
IN the Labor or Management Fielj>,
Washington^ D. C.
The select committee convened at 10 :30 a. m., pursuant to Senate
Resolution 74, agreed to January 30, 1957, in room 457, Senate Office
Building, Senator John L. McClellan (chairman of the select com-
mittee) presiding.
Present : Senator John L. McClellan, Democrat, Arkansas ; Senator
Sam J. Ervin, Jr., Democrat, North Carolina ; Senator Pat McNamara,
Democrat, Michigan ; Senator Barry Gold water, Republican, Arizona;
Senator Carl T. Curtis, Republican, Nebraska.
Also present : Robert F. Kennedy, chief counsel ; Jerome S. Adler-
man, assistant chief counsel; Alphonse F. Calabrese, investigator;
Jack S. Balaban, a GAO investigator on loan to the select committee;
Robert Worrath, investigator ; Ruth Young Watt, chief clerk.
The Chairman. The hearing will be in order.
(Members of the select committee present at the convening of the
session: Senators McClellan and Ervin.)
Mr. Kennedy. Mr. Louis Lattanzio will be the first witness, Mr.
Chairman.
The Chairman. Come forward, Mr. Lattanzio. Will you be sworn ?
You do solemnly swear that the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and nothing
but the truth, so help you God ?
Mr. Lattanzio. I do.
TESTIMONY OF LOUIS LATTANZIO
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Lattanzio. My name is Louis A. Lattanzio. I live at 608
South Van Buren Street, Wilmington, Del.
The Chairman. You will have to speak a little louder. In this
committee room, we have no public address system, so you will have to
speak loud enough so that your natural voice can be heard.
Mr. Lattanzio. I am a member of Operating Engineers, Local 542.
The Chairman. Just remember to speak a little louder so we can
hear you.
Do you waive the right of counsel while you testify ?
Mr. Lattanzio. Yes, sir.
7993
7994 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Thank you very much.
Proceed, Mr. Kennedy.
Mr. Kennedy. You spell your name L-a-t-t-a-n-z-i-o?
]\Ir. LA-rrANzio. That is correct.
Mr. Kennedy. And you are in the Operating Engineers ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. And you are in the "A"' or "B" book ?
Mr. Lattanzio. In the parent.
Mr. Kennedy. In the parent organization ?
Mr. Lattanzio. That is right.
Mr. Kennedy. And you have been in the Operating Engineers for
how long ?
Mr. Lattanzio. Since 1948.
Mr. Ivennedy. Since 1948 and that is local 542, Philadelphia ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. What do you do in the Operating Engineers ?
Mr. Lattanzio. Crane operator, backers, most everything in general.
Mr. Kennedy. Mr. Lattanzio, you are married ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. And you have how many children ?
Mr. Lattanzio. Four.
Mr. Kennedy. You were in the service during the war ?
Mr. Laitanzio. Yes, sir.
Mr. Kennedy. For how long?
Mr. Lait^anzio. 33 months.
Mr. Kennedy. And you served overseas during that period of time ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. In Europe ?
Mr, La'itanzio. Yes, sir.
Mr. Ivennedy. What Army were you in in Europe ?
Mr. Lattanzio. In the infantry.
Mr. Kennedy. In the infantry ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. What group ?
Mr. Lattanzio. 29th Division.
Mr. Ivennedy. Did you receive any decorations ?
Mr. Lattanzio. I got the purple heart and two battle stars, I believe
it was.
Mr. Kennedy. Mr. Lattanzio, you have been with Roy Underwood
in his opposition to the group that controls the local ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Did you, during any of this period of time that you
were with Mr. Underwood, have any difficulty getting work 'I
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. "^^Hien was this ? 1955?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Could you speak right up and just tell us in your
own words ? You had difficulty getting a job ?
Mr. Lattanzio. Yes, sir, I did. The job began in March of 1955.
Mr. Kennedy. What job are you talking about ?
Mr. Lattanzio. I am talking about the Tidewater job in Delaware.
Mr. Kennedy, The Tidewater job in Delaware City, Del. ?
Mr. Lattanzio. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 7995
Mr. Kennedy. Was that a major job?
Mr. Lattanzio. Yes, sir, one of the biggest jobs that ever hit the
State of Delaware.
Mr. Kennedy. One of the biggest jobs in Delaware?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. And they were hiring a great number of people ?
Mr. Lattanzio. Yes, sir. At one time there must have been a thou-
sand operating engineers,
Mr. Kennedy. One thousand operating engineers ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. So there were a lot of jobs available ?
Mr. Lattanzio. Quite a few.
Mr. Kennedy. Were you having difficulty getting work ?
Mr. Lattanzio. Yes, sir. I tried even before the job first broke —
we already knew who the master mechanic was going to be.
Mr. Kennedy. You have to yell it out, like you did when you were
in the Army.
Mr. Lattanzio. As I say, we already knew who the master mechanic
was going to me.
The Chairman. The master mechanic controls the job ?
Mr. Lattanzio. Controls the Operating Engineers.
The Chairman. Controls the Operating Engineers ?
Mr. Lattanzio. Yes, sir.
The Chairman. And you knew who he was going to be before the
job started?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Who was he ?
Mr. Lattanzio. John Piscitelli.
Mr. Kennedy. P-i-s-c-i-t-e-1-l-i?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. He is Mr. Edward Piscitelli's son?
Mr. Lattanzio. That is right, who was the business agent.
Mr. Kennedy. We had some testimony yesterday about him, I
believe.
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. John Piscitelli was the master mechanic on this job ?
Mr. Lattanzio. That is correct. I made it a point to call him, I
believe it was about the middle of February, and told him that I heard
he was going to be the master mechanic, and I wanted a job there.
At that time he says, "Don't worry, Lou, you will be one of the first
ones on the job."
So time went on, March, April, May, June, and I kept pestering,
kept pestering his father, Eddie, who was the business agent, and he
says, "Don't worry, I will get you on."
That went on for a matter of about 7 or 8 months.
Finally I collared him in the early part of September. I don't
remember his exact words, but he says, "You are just wasting your
time. As long as I am the business agent, you will never go to work
there."
Mr. Kennedy. You had been associated with Roy Underwood's
group during this period of time ?
Mr. Lattanzio. Yes, sir. So that is when I really got teed off.
Myself and Joe Sylvester, we went to the NLRB at 10 o'clock that
7996 IMPROPER ACTIVITIES IN THE LABOR FIELD
morning, and at 8 o'clock that night, we got a telephone call from
Eddie Piscitelli to go to work the next day.
Mr. IvENNEDY, You got a job after bringing it to the attention of
the National Labor Relations Board ?
Mr. Lattanzio. That is correct.
Mr. IvENNEDY. But prior to that, for a period of 7 or 8 months, even
though hundreds and hundreds of operating engineers were being
hired, you were unable to to get employment ?
Mr. Lattanzio. That is correct. As a matter of fact, none of the
boys in Delaware could get a job there, not only myself.
Mr. IvENNEDY. Boys in Delaware were liavmg difficulty, and they
were bringing them in from Philadelphia ?
Mr. Lattanzio. Bringing them in from all 48.
Mr. IvENNEDT. From other States ?
Mr. Lattanzio. Yes, sir. Specially up-State Pennsylvania.
Mr. Kennedy. Specially what ?
Mr. Lattanzio. Up-State Pennsylvania.
Mr. Ej:nnedy. Many of the group in Delaware had opposed Wil-
liam E. Maloney and those who were running and operating the
union ; is that right ?
Mr. Lattanzio. That is right ; yes, sir.
Mr. IsJsNNEDY. And there had been difficulty between those in Del-
aware and this other faction, the pro-Maloney faction in the union,
had there not ?
Mr. Lattanzio. That is correct.
Mr. Ivennedy. And your Delaware group was having difficulty get-
ting jobs?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Finally you went to work, is that right?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. This is wliat ? 1955 ?
Mr. Lattanzio. 1955. September of 1955.
Mr. KJENNEDY. Was there any gambling on the job ?
Mr. Lattanzio. Yes, sir, quite a bit of gambling.
Mr. Kennedy. Was it organized gambling ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Would you tell us what kind of gambling went on
and how it was operated ?
Mr. Lattanzio. Well
Mr. I^nnedy. Would you yell it right up ?
Mr. Lattanzio. Well, this gambling that was going on was being
held by members of the Operating Engmeers.
Mr. Kennedy. What kind of gambling, first.
Mr. Lattanzio. Crap games, horse races, numbers, different types
of pools.
Mr. Kennedy. Wliat do you mean by different kinds of pools?
Mr. Lattanzio. Baseball pools and whatever sports was active at
the time.
Mr. IvENNEDY. Football pools?
Mr. Lattanzio. And football pools.
Mr. Kennedy. And numbers ?
Mr. Lattanzio. Numbers.
Mr. Kennedy. And they were taking horse bets ?
IMPROPER Acrn^rriES est the labor field 7997
Mr. Lattanzio. That is correct.
Mr. IvENNEDY. And were they playing craps ?
Mr. Lattanzio. Yes, sir.
Mr. Kj:nnedy. And cards ?
Mr. Lattanzio. Yes, sir, quite a bit of cards.
Mr. Kenxedy. First, on the craps, where was that being played —
the dice game?
Mr. Lattanzio. That was being held in the changehouse of the
Operating Engineers,
Mr. Kennedy. In the changehouse of the Operating Engineers
themselves ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. What hours would that go on ?
Mr. Lattanzio. Well, if it was a working day — what I mean by a
working day is if it wasn't raining or anything — they would get the
game underway at 11 : 30 or a quarter to 12 and it would last up to
12 : 45 or 1 o'clock. Our lunch period was only from 12 to 12 : 30. But
if it was a rainy day, we would have to punch m at 8 o'clock, and right
after 8 o'clock the games would get underway.
Mr. Kennedy. You say it was organized, this gambling?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. It wasn't just a couple of fellows or a number of
fellows getting together and plajdng craps ?
Mr. Lattanzio. No, sir.
Mr. Kennedy. It was actually organized ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Who was responsible for organizing it ?
Mr. Lattanzio. The two main ones that organized the game was a
fellow called Fred Fero.
Mr. I^NNEDY. F-e-r-o ?
Mr. Lattanzio. It is either "a" or "o."
Mr. Kennedy. F-e-r-o, I believe.
Mr. Lattanzio. And a fellow by the nickname of Keggy. I think
his full name is Paris DiSimone.
Mr. Kennedy. And was there anybody else with them ?
Mr. Lattanzio. There was quite a few with them, but they were the
two main characters.
Mr. Kennedy. What about Joe Valentino ?
Mr. Lattanzio. He was with them. I couldn't say whether it was
on a 50-50 basis or 25-percent basis, or what it was.
Mr. Kennedy. But Fero and Keggy, another name for Paris Di-
Simone, were the main ones, and Valentino was assisting them ?
Mr. Lattanzio. I think that would be a fair enough word; yes, sir.
Mr. Kennedy. Were there many people that participated in the
games ?
Mr. Lattanzio. Yes, sir ; there was quite a few.
Mr. Kj:nnedy. It was crowded every day ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Were there large stakes ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Would you have any idea as far as the stakes were
concerned ? On one throw, for instance, what was it ?
21243— 58— pt. 20 6
7998 IMPROPEIR ACTIVITIES IN" THE LABOR FIELD
Mr. Lattanzio. Well, on one throw, I would say an average of
$250 to $300 being paid out.
Mr. Kennedy. And everybody participated ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Did the master mechanic know that this was going
on?
Mr. Lattanzio. He sure did.
Mr. Kennedy. And he did nothing to stop it ?
Mr. Lattanzio. No, sir.
Mr. Ivennedy. You say the master mechanic was Piscitelli ?
Mr. Lattanzio. Johnny Piscitelli.
Mr. Kennedy. And he did nothing to stop it ?
Mr. Lattanzio. No, sir.
Mr. Kennedy. What was his father's position at that time ?
Mr. Lattanzio. He was the business agent.
Mr. Kennedy. He was the business agent for the local ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy, You were talking about other kinds of gambling.
Now would they do the football pools and the baseball pools and the
numbers and horse races ? How would that take place ? Would that
take place during the noon hour, too ?
Mr. Lattanzio. No, sir. That would take place during the day it-
self. I wasn't watching the pool so much. I was more interested in
watching them taking the horse bets and the numbers. This Freddie
Fero had a pickup issued to him.
Mr. Kennedy. What do you mean by a pickup ?
Mr. Lattanzio. A pickup. He was considered a field foreman at
that time, and supposed to go around and check up on the men. But
he was doing other than that. He was using the pickup for his own
personal service by running around to different sites to pick up these
horse bets.
Mr. Kennedy. So Fred Fero, who was working on the job in some
semiofficial position, had a pickup truck and he would go around and
take the bets from the various men in the pickup truck ?
Mr. Lattanzio. That is correct ; yes, sir. And Keggy also, he would
do the same thing.
Mr. Kennedy. He had a pickup truck, too ?
Mr. Lattanzio. It wasn't issued to him, but from time to time,
Fred would give him his pickup.
Mr. Kennedy. Did you actually see people who were betting?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. Was this well known on the job ?
Mr. Lattanzio. Very well known.
Mr. Kennedy. Wlien would they start making their tours in the
truck?
Mr. Lattanzio. They wouldn't get their Armstrong until about 11
or 11: 15.
Mr. Ivennedy. What do you mean by Armstrong ?
Mr. Lattanzio. Armstrong is a racing sheet. They would not get
that until about 11 : 15 and that is wlien tliey would start.
Mr. Kennedy. They would start their tour by 11 : 15 ?
Mr. Lattanzio. 11 : 15 or 11 : 30 and during the crap games they
would pick up the bets, too.
IMPROPER Acrn^rTrES est the. labor field 7999
Mr. Kennedy. "What about in the afternoon ? Did they have tour-
ing in the afternoon ?
Mr. Lattanzio. Yes, sir. I don't know just how the races are
scheduled, but I think they are every lialf-hour or every 45 minutes,
sometliing like that. Of course, you have a full racing program,
and whatever races they wanted to bet, they would get around to it.
Mr. Kennedy. Would there be any bettting early in the morning 'i
Mr. Lattanzio. Just for the numbers. The numbers would have
to be in by a certain time.
(At this point Senator Goldwater entered the room.)
Mr. Kennedy. When would they start betting on the numbers?
Mr. Lattanzio. As soon as the men came in and started punching
in at 8 o'clock.
Mr. Ivennedy. So the betting started early in the morning and
lasted throughout the day ; is that right ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. With the pickup trucks, and the crap and dice
games during the period of 12 : 30, or a quarter to 1 or so, and then
in the afternoon, the pickup truck, again, taking other kinds of bets?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. That went on during this whole period of time ?
Mr. Lattanzio. Yes, sir ; as long as I was there. From the minute
I got there until the minute I left.
Mr. Ivennedy. And the individuals you mentioned, Fero, Valen-
tino, and DiSimone, were the ones behind it ?
Mr. Lattanzio. Yes, sir. Fred Fero had gotten sick. Exactly
how long he was there, I couldn't know. I couldn't tell you. But
after he got sick, he never came back, and Keggy took over then.
Mr. Kennedy. Keggy was the one that ran it after that ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. And you say that the master mechanic on the job was
well aware this was going on ?
Mr. Lattanzio. Very much so.
Mr. Kennedy. And he did nothing to stop it ?
Mr. Lattanzio. No, sir.
Mr. Kennedy. "Wliat about those individuals who lost money?
What would happen as far as they were concerned ? Did they borrow
any money ?
Mr. Lattanzio. Yes, sir. Some of the guyS got hurt pretty bad, and
this Keggy had sort of a racket of his own. He was one of these loan
sharks. He would lend $5 for $6. For every $5 that was lent, you had
to pay $6 back.
Mr. Kennedy. He was also active as a loan shark ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. And would loan money at $65 for every $5 ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. A-VTien would you have to repay the money ?
Mr. Lattanzio. I would say from week to week, sir.
Mr. Kennedy. So you have had to repay $6 for every $5 that he
loaned you, and you had to pay after a week ; is that right ?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. If you went on to the next week, it was the same
thing again ?
8000 IMPROPEIR ACTIVITIES IN THE LABOR FIELD
Mr. Lattanzio. I don't think he would let you get beyond that
week, sir.
Mr. Kennedy. Did the State police ever become aware that this was
going on ?
Mr. Lattanzio. Yes, they did. They have been there many times.
In fact, myself and another fellow went with me to the State police.
Mr. Kennedy. Were they able to break it up ?
Mr. Lattanzio. No, sir ; they could never catch them. They always
managed to get information before the police got there. The only
one that could have got that information would be Johnny Piscitelli.
Mr. Kennedy. Do you ever know if Piscitelli told them ?
Mr. Lattanzio. Yes, sir. I was right in the change house when
Piscitelli came in and said, "No crap games today. The State police
are out there."
Mr. Kennedy. He said, "No crap games today. The State police are
out there"?
Mr. Lattanzio. Yes, sir.
Mr. Kennedy. "Wlien you talk about it being organized, was it a
regular stickman ?
Mr. Lattanzio. Yes, sir. They had a stickman of their own, a
fellow by the name of Butler. I don't know his real name, but that
is his nickname.
Mr. Kennedy. He was there every day ?
Mr. Lattanzio. Yes, sir ; he would get the game underway.
Mr. Kjinnedy. They had their own dice and own layout ?
Mr. Lattanzio. Yes, sir; Keggy would have his own dice, a special
type of dice.
The Chairman. If I understand, these men that were operating
this would bank the game, so to speak ?
Mr. Lattanzio. Yes, sir.
The Chairman. In other words, it wasn't a sociable affair of a
few getting together and shooting a little craps or placing a bet on
a horse race ?
Mr. Lattanzio. You would never consider that a sociable game,
sir.
The Chairman. In other words, the labor authorities on the job,
those responsible for the welfare of the laboring men, set up this
gambling organization there on the job, and conducted it there. Is
that correct?
Mr. Lattanzio. One in particular, sir.
The Chairman. One in particular?
Mr. Lattanzio. Yes, sir.
The Chairman. 'Wlio?
Mr. Lattanzio. Fred Fero.
The Chairman. And the master mechanic laiew about it ?
Mr. Lattanzio. Yes, sir.
The Chairman. And also the business agent knew about it?
Mr. Lattanzio. Yes, sir ; all the business agents that we have had
knew about it.
The Chairman. All of them knew about it ?
Mr. Lattanzio. Yes, sir.
The Chairman. So it was done with their knowledge and consent, .
at least ?
IMPROI'E'R ACTIVrTlES EST THE LABOR FIELD 8001
The Chairman. Do you know whether they got a rakedown out
of it?
Mr. Lattanzio. I assume they did, sir. I could never prove it.
The Chairman. You don't know tliat ?
.Mr. Lattanzio. No, sir.
The Chairman. But it was so set up and organized, with their
permission, their knowledge and consent, and somebody was making
a lot of money out of it ?
Mr. Lattanzio. I would assume that, sir.
The Chairman. Do you know what the rakeoff was at the dice
game?
Mr. Lattanzio. No, sir.
The Chairman. Do you know what percentage ?
Mr. Lattanzio. No, sir.
The Chairman. You said some of them got hurt pretty bad. What
do you mean by that ? How much ?
Mr. Lattanzio. By losing their whole paychecks.
The Chairman. Losing their whole paychecks ?
Mr. Lattanzio. Yes, sir.
The Chairman. Married men with families ?
Mr. Lattanzio. Yes, sir.
The Chairman. What did they lose it on, the dice game, the races,
or the pool ?
Mr. Lattanzio. On the dice game itself, sir.
The Chairman. The dice game?
Mr. Lattanzio. Yes, sir.
The Chairman. Any other questions ?
Senator Ervin. I would like to ask 1 or 2. I assume since you
received the Purple Heart Medal, you were wounded in action fight-
ing for your country ?
Mr. Lattanzio. Yes, sir.
Senator Ervin. And when you are back in your country seeking
employment to support yourself and your wife and children, the
business manager of the local of the Operating Engineers refused
to give you a job, you exercised your privilege as an American to
select the faction of a union to which you desired to give your sup-
port ?
Mr. Lattanzio. That is correct, sir.
(At this point. Senators McNamara and Curtis entered the hearing
room.)
Senator Ervin. In other words, you believed that the local union
was entitled to be out of trusteeship and was entitled to manage its
own aifairs, and you were denied a job for 6 or 7 months because you
entertained that belief, instead of being with it and have it continued
on a trusteeship for an indefinite period of time ?
Mr. Lattanzio. That is correct, sir.
(At this point. Senator Curtis withdrew from the hearing room.)
Senator Ervin. And you had to go to the National Labor Kelations
Board before you were permitted by the business manager to earn your
own bread by the sweat of your own brow ?
Mr. Lattanzio. That is correct, sir.
Senator Ervin. Are there any further questions? If not, thank
jou very much. You may stand aside. Call the next witness.
8002 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. I would like to call Mr. Fred Fero, Joe Valen-
tino, and Paris DiSimone.
(At this point, the folio wing; members were present: Senators Mc-
Clellan, Goldwater, Ervin, and McNamara.)
The ChaikMx\n. You will be sworn. Do you and each of you sol-
emnly swear the evidence you shall give before this Senate select com-
mittee shall be the truth, the whole truth, and nothing but the truth,
so help you God ?
Mr. Fero. I do.
Mr. Valentino. I do.
Mr. DiSimone. I do.
TESTIMONY OF JOSEPH VALENTINO, ERED FERO, AND PARIS
DiSIMONE, ACCOMPANIED BY COUNSEL, GEORGE J. CHARLES
The Chairman. Beginning on my leftj the witness will state his
name, his place of residence, and his business or occupation.
Mr. Valentino. My name is Joseph Valentino. I live at 1604
South Ninth Street, Philadelphia. I am an operating engineer, a
member of 542.
The Chairman. The next witness ?
Mr. Fero. I am Fred Fero, 1635 South Broad Street, operating
engineer, from 1942.
Mr. DiSimone. I am Paris DiSimone, 1534 South Ninth Street..
I am an oiler, and I have an A book. I have been in the local for
7 years.
The Chairman. Seven years?
Mr. DiSimone. Yes.
The Chairman. Counsel, identify yourself for the record, please.
Mr. Charles. George J. Charles, a member of the bar of the Dis-
trict of Columbia, with offices at 1025 Connecticut Avenue NW.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Valentino, you have been an operating engineer
for how long ?
Mr. Valentino. Since 1942.
Mr. Kennedy. Since 1942?
Mr. Valentino. Yes, sir.
Mr. Kennedy. And were you working down on this Delaware job
for a while ?
Mr. Valentino. Yes, sir.
Mr. Kennedy. When did you start working there ?
Mr. Valentino. 1955, 1 think. I am not sure.
Mr. Kennedy. 1955?
Mr. Valentino. Yes, in July or August. August, I think.
Mr. IvENNEDY. For how long a period of time did you work there ?
Mr. Valentino. I work there about 12 or 13 months.
Mr. Kennedy. How many months ?
Mr. Valentino. 12 or 13 : T am not sure exactly.
Mr. Kennedy. What work did you do there ?
Mr. Valentino. I run the tugger and I run the welding machines.
Mr. Kennedy. What kind of machines?
Mr. Valentino. Welding machines.
Mr. I^nnedy. Did you know of any gambling that was going on
down there ?
IMPROPER ACTIVITIES Ds THE LABOR FIELD 8003
Mr. Valentino. There was minor gambling, shooting crap at dinner
time.
Mr. Kennedy. You will have to speak up.
Mr. Valentino. They were playing dice at dinner time.
Mr. Kennedy. Doing what?
Mr. Valentino. Shooting dice at dinner time.
Mr. Kennedy. Dinner time?
Mr. Valentino. Yes, sir.
Mr. Kennedy. What time was that?
Mr. Valentino. It wouldn't start before 12 o'clock and it would stop
at 12 : 30.
Mr. Kennedy. They would shoot crap from 12 to 12 : 30.
Mr. Valentino. That is right.
Mr. Kennedy. Did you shoot crap yourself ?
Mr. Valentino. Occasionally
Mr. Kennedy. Were you in there every day sliooting crap ?
Mr. Valentino. Occasionally. If I had money, I would go there.
If I didn't have money, I wouldn't play.
Mr. Kennedy. Did you run the game ?
Mr. Valentino. No, sir.
Mr. Kennedy. Was there any other kind of gambling going on?
Mr. Valentino. No, sir ; not there.
Mr. Kennedy. Well, was there any other kind of gambling going
on?
Mr. Valentino. Certainly. There is all kind of gambling going
onon those jobs.
Mr. Kennedy. Was there horse racing ?
Mr. Valentino. No, sir.
Mr. Kennedy. You never took any horse racing bets yourself ?
Mr. Valentino. No, sir.
Mr. Kennedy. Was there any football pool ?
Mr. Valentino. Not that I know. There was 1 pool, and 2 time-
keepers were fired for it. They were horse pools. They would buy
it on Monday to play the following week. They were the only kind
of pools I know, and they were fired for it.
Mr. Kennedy. But you didn't have anything to do with it yourself ?
Mr. Valentino. No, sir.
Mr. Kennedy. Did you bet at all ?
Mr. Valentino. What do you mean bet ?
Mr. I^nnedy. Did you take a number ?
Mr. Valentino. I play the number during the week, once in a
while.
Mr. Kennedy. Whom did you take the numbers from ?
Mr. Valentino. I didn't take any numbers.
Mr. Kennedy. Who did you bet with ?
Mr. Valentino. I used to bet with a colored fellow.
Mr, Kennedy. What was the colored fellow's name ?
Mr. Valentino. George.
Mr. Kennedy. George who ?
Mr. Valentino. I don't know the second name.
Mr. Kennedy. He was just a colored fellow around ?
Mr. Valenitno. He was one of the pushers on the job.
Mr. Kennedy. He was what ?
8004 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Valentino. One of the pushers on the job. He was one of the
bosses, had charge of a few men.
Mr. Kennedy. He was a pusher or a boss ?
Mr. Valentino. A pusher is the same thing.
Mr. Kennedy. He was a pusher ?
Mr. Valentino. That is like a foreman. It is below the foreman.
Yes.
Mr. Kennedy. He was one of the foremen on the job ?
Mr. Valentino. Yes, sir.
Mr. Kennedy. And he was around taking numbers ?
Mr. Valentino. Yes, sir.
Mr. Kennedy. And you made some bets with him ?
Mr. Valentino. Once in a while I put a bet.
Mr. Kennedy. And you never took a bet yourself ?
Mr. Valentino. I never took a number bet in my life.
Mr. Kennedy. What about horseraces ?
Mr. Valentino. I never took any bets on horseraces.
Mr. Kennedy. But George took the number bets ?
Mr. Valentino. That is all I ever seen.
Mr. Kennedy. But you never took it yourself ?
Mr. Valentino. No, sir.
Mr. Kennedy. Never went near that yourself ?
Mr. Valentino. No, sir.
Mr. Kennedy. And the only fellow you knew who was doing it was
the colored fellow George ?
Mr. Valentino. That is right.
Mr. Kennedy. And the testimony of the previous witness regard-
ing you is incorrect ?
Mr. Valentino. Positively incorrect.
Mr. Kennedy. You didn't have an;^thing to do with it ?
Mr. Valentino. I never had anything to do with it.
Mr. Kennedy. Mr. Fred Fero, you have been an operating engineer
for how long ?
Mr. Fero. I joined the local in 1942.
Mr. Kennedy. Since 1942 ?
Mr. Fero. Yes, sir.
Mr. Kennedy. And you are in A or B or in the parent body ?
Mr. Fero. The parent body.
Mr. Kennedy. What kind of work do you do ?
Mr. Fero. Well, I started out as a B man ; I was a roadbuilder, and
then I became a crane operator, and I got my parent-body book.
Mr. Kennedy. You worked on the Delaware job ?
Mr. Fero. That is right.
Mr. Kennedy. For how long ?
Mr. Fero. I don't remember if it was 6 months or what it was. I
pulled two disks and went to the hospital and couldn't go back to work
for a year after that.
Mr. Kennedy. Did you have a foreman's job down there ?
Mr. Fero. When I first went down there, I went down there as a
bulldozer operator, and, as men came in, then I was elevated.
Mr. Kennedy. You were elevated ?
Mr. Fero. With the say of the company.
Mr. Kennedy. Were you acting as a foreman ?
IMPROPER ACTIVITIES IN THE LABOR FIEI.D 8005
Mr. Fero. Yes ; I would call it a foreman.
Mr. Kennedy. Did you have a pick-up truck at your disposal ?
Mr. Fero. That is right.
Mr. Kennedy. While on this Delaware job — this was 1955 that you
were down there ?
Mr. Fero. I am pretty sure I started in 1955.
Mr. Kennedy. Was there any gambling going on, that you knew off
Mr. Fero. Yes, on every job
Mr. Kennedy. Would you speak up a little louder, please ?
Mr. Fero. Every job that we was ever on. Underwood's job, every
job, there was always cards and a little dice, but it wasn't organized.
It was among the fellows. You will find it in all change shanties.
Mr. Kennedy. When was the gambling going on in Delaware?
Mr. Fero. After the whistles blew, from 10 after 12 to 12 : 30.
Mr. Kennedy. From 10 after 12 to 12 : 30 ?
Mr. Fero. Well, you don't work in the change shanty.
Mr. Kennedy. From 10 after 12 to 12 : 30 ?
Mr. Fero. Yes, sir.
Mr. Kennedy. It didn't go on any other time ?
Mr. Fero. No, sir. Mr. Lattanzio used to play cards. I used to get
him out of the change shanty to go to work.
Mr. Kennedy. But the gambling was only going on from 10 after
12 to 12 : 30 ?
Mr. Fero. That is right.
Mr. Kennedy. Did you take part in this ?
Mr. Fero. I used to play, when I had time.
Mr. Kennedy. Did you organize it yourself ?
Mr. Fero. No. Everybody played. It was not organized.
Mr. Kennedy. Was there other gambling going on, that you knew
about ?
Mr. Fero. There might have been.
Mr. Kennedy. Did anybody approach you on the numbers ?
Mr. Fero. No, sir.
Mr. Kennedy. Did you ever approach anybody on numbers ?
Mr. Fero. No, sir.
Mr. Kennedy. Wliat about the horse pool, the horseraces ?
Mr. Fero. I don't know nothing about horse pools.
Mr. Kennedy. You never made any bets on that ?
Mr. Fero. No. The only thing that would happen now and then
would be a few fellows would probably be going to the track, and we
would give them some money to go bet it, and they would bring the
money the next day.
Mr. Kennedy. Did you ever take any bets on horseraces ?
Mr. Fero. No, sir, outside of sending it to the track when somebody
was going.
Mr. Kennedy. How often did that happen ?
Mr. Fero. Not too often.
Mr. Kennedy. Well, how often ?
Mr. Fero. Well, it was a big job.
Mr. Kennedy. How often did that happen, that you knew of ?
Mr. Fero. Maybe once or twice a week.
Mr. Kennedy. Once or twice a week that you bet ?
Mr. Fero. No ; I didn't bet. The fellows used to bet.
8006 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. How often did you participate in it ?
Mr. Fero. Well, the time that I was there, it might have been maybe
once or twice a week.
Mr. Kennedy. Once or twice a week ?
Mr. Fero. And sometimes not at all.
Mr. Kennedy. On the average of the 6 months you were there, how
often did you do this ?
Mr. Fero. Oli' and on, I would say maybe a couple of months. Some
weeks yes, and some weeks no.
Mr. Kennedy. A couple of times a week ?
Mr. Fero. Maybe some weeks. Not always.
Mr. Kennedy. What about the football pool i
Mr. Fero. I was in the hospital. I didn't know anything about
football.
Mr. Kennedy. What about baseball ?
Mr. Feko. Nothing.
Mr. Kennedy. You never knew anything about that ?
Mr. Fero. Nothing. I was laid up for a year.
Mr. Kennedy. Just answer the question. Did you know that was
going on ?
Mr. Fero. No, sir.
Mr. Kennedy. Did you ever get any money out of the baseball or
football pools ?
Mr. Fero. No.
Mr. Kennedy. Did you ever get any money, other than your in-
dividual bet, did you ever get any money out of the horseracing ?
Mr. Fero. No ; I lost money.
Mr. Kennedy. What about the crap games? How did you make
out in those ?
Mr. Fero. I lost.
Mr. Kennedy. You lost in that ? Did you shoot the dice yourself ?
Mr. Fero. Many times.
Mr. Kennedy, You are Mr. DiSimone ?
Mr. DiSiMONE. Yes.
ISIr. Kennedy. How long have you been in the Operating Engineers ?
Mr. DiSiMONE. About 6 or 7 years.
Mr. E^ENNEDY. Six or seven years ?
Mr. DiSiMONE. Six or seven years ; yes.
Mr. Kennedy. Wliat section are you in ?
Mr. DiSiMONE. I have an A book.
Mr. Kennedy. You have an A book ?
Mr. DiSiMONE. I have an A book.
Mr. Kennedy. What kind of work do you do ?
Mr. DiSiMONE. I have an A book. I am an apprentice.
Mr. IvENNEDY. "Wliat kind of work do you do ?
Mr. DiSiMONE. Well, where I was working now ?
Mr. Kennedy. Wliat kind of work do you do ? You worked at the
Delaware job ?
Mr. DiSiMONE. Yes.
Mr. Kennedy. What kind of work did you do there ?
Mr. DiSiMONE. I was on a compressor when I first went there.
Mr. Kennedy. Wliat do you do on a compressor, push the button ?
Mr. DiSimone. Well, I check the oil and check the motor.
IMPROPER ACTIVITIES IIS" THE LABOR FIELD 8007
Mr. Kennedy, You check the oil and check the motor and push the
button and get that started ?
Mr. DiSiMONE. Yes.
Mr. Kennedy. And at the end of the day you turn it oS ?
Mr. DiSiMONE. That is right, and keep it clean.
Mr. Kennedy. Did you know of any gambling that was going on
down there ?
Mr. DiSimone. Yes.
Mr. Kennedy. Did you participate in the gambling ?
Mr. DiSiMONE. Yes, I did.
Mr. Kennedy. Where was the gambling taking place ?
Mr. DiSiMONE. It used to take place in the shanty, where we ate
our lunch.
Mr. Kennedy. What time ?
Mr. DiSiMONE. From 12 o'clock to 12 : 30.
Mr. Kennedy. What kind of gambling was taking place ?
Mr. DiSiMONE. We used to shoot craps and when it rained we
played cards.
Mr. Kennedy. Did you bring your own dice with you ?
Mr. DiSimone. Sometimes I did.
Mr. Kennedy. Did you furnish the dice for the game ?
Mr. DiSimone. I didn't do it all the time. I brought my own dice
and figured I would know it was a good game, a legitimate game.
It was among our own selves, and I brought my own dice.
Mr. Kennedy. How many times have you been arrested, Mr.
DiSimone?
Mr. DiSimone. I would say about 7 or 8 times.
Mr. Kennedy. Seven or eight times ?
Mr. DiSimone. Yes.
Mr. Kennedy. What otlier gambling was going on down there ?
Mr. DiSimone. We used to play cards.
I know we played cards.
Mr. Kennedy. What about booking horseraces ?
Mr. DiSimone. I heard about it, but I never played horses.
Mr. Kennedy. You never did that yourself ?
Mr. DiSimone. No.
Mr. Kennedy. You just heard it was going on ?
Mr. DiSimone. Yes.
Mr. Kennedy. You never participated yourself ?
Mr. DiSimone. No.
Mr. Kennedy. AYhat about the numbers ?
Mr. DiSimone. I heard there was numbers down there.
Mr. Kennedy. You never participated yourself ?
Mr. DiSimone. No.
Mr. Kennedy. ^Yho was handling the numbers ?
Mr. DiSimone. I don't know.
Mr. Kennedy. Because you never went near it ?
Mr. DiSimone. No, sir.
Mr. KJENNEDY. What about the football pools ?
Mr. DiSimone. I heard about it, but I never played football pools.
Mr. Kennedy. You heard about it, but nobody ever approached you
about it ?
Mr. DiSimone. No.
8008 IMPROPER ACTIVITIES IN THE LABOR FIEI.I>
Mr. Kennedy. What about the baseball pool ?
Mr. DiSiMONE. I heard about it but I never played it.
Mr. Kennedy. All of these things were going on but you never
played it?
Mr. DiSiMONE. That is right.
Mr. Kennedy. Nobody ever approached you about getting in the
game?
Mr. DiSiMONE. No.
Mr. Kennedy. Is that right, they did not ?
Mr. DiSiMONE. Nobody approached me.
Mr. Kennedy. Even though you were active in these other games ?
Mr. DiSimone. I used to play cards and nobody approached me to
play.
Mr. Kennedy. No one approached you on the other things ?
Mr. DiSimone. No.
Mr. Kennedy. Did you go in and play every day ?
Mr. DiSimone. Yes.
Mr. Kennedy. Every day you were there ?
Mr. DiSimone. Every day.
Mr. Kennedy. And sometimes you would bring your own dice ?
Mr. DiSimone. Sometimes I did.
Mr. Kennedy. You organized the game yourself ?
Mr. DiSimone. No, I did not organize it. We started when he used
to walk in.
Mr. Kennedy. Did you have anybody or a stick man there ?
Mr. DiSimone. I never had anybody.
Mr. Kennedy. Who was the stick man ?
Mr. DiSimone. There were quite a few different men there, and
every time there would be a different fellow there, who would get
there first used to throw the dice in.
Mr. Kennedy. Did Mr. Piscitelli know it was going on ?
Mr. DiSimone. Not to my knowledge. I don't know if he did or
not.
Mr. Kennedy. Mr. Piscitelli did not know it was going on ?
Mr. DiSimone. Not to my knowledge.
]Mr. Kennedy. He was never there while it was going on?
Mr. DiSimone. No, sir.
Mr. Kennedy. Did you ever give any money to Mr. Piscitelli ?
Mr. DiSimone. No.
Mr. Kennedy. Did you ever give him a gift ?
Mr. DiSimone. I never did.
Mr. Kennedy. Did you ever discuss giving him a gift?
Mr. DiSimone. No, sir.
Mr. Kennedy. What about Mr. Fero, did you ever discuss giving^
him a gift ?
Mr. Fero. I was sick, and I never gave him a gift.
Mr. IvENNEDY. Was there ever any discussion, Mr. DiSimone, about
giving him something or did you ever go to him and say you would
like to give him a little money or present ?
Mr. DiSimone. No ; I did not.
Mr. Kennedy. Did you ever talk to him about giving him a set of
golf sticks ?
Mr. DiSimone. No; I did not. I loaned him my golf sticks one
time, and he asked me to lend them to him.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8009
Mr. Kennedy. Did you get them back ?
Mr. DiSiMONE, Yes ; he gave them back.
Mr. IvENNEDY. How loiig did he keep them ?
Mr. DiSiMONE. He only kept them a couple of weeks.
Mr. Kennedy. And then he gave the golf sticks back ?
Mr. DiSiMONE. Yes, sir.
Mr. Kennedy. Did you ever give him any golf sticks?
Mr. DiSiMONE. No ; I did not,
Mr. Kennedy. Did you ever talk to anybody about giving him a
set of golf sticks ?
Mr. D1S1310NE. Not to my knowledge ; I don't remember.
Mr. Ivennedy. You never did, and you never talked about any golf
clubs?
Mr. DiSimone. No, sir.
Mr. Kennedy. What is your answer ?
Mr. DiSiMONE. I said "No."
Mr. Kennedy. You never talked about getting him some golf clubs?
Mr. DiSimone. So far as I know.
Mr. Kennedy. You were grateful to him and you wanted to give
him some golf clubs?
Mr. DiSiMONE. I knew the fellow since he was born, because he
was born around the same neighborhood, since he was a little boy, and
we were born and raised together. I never made an offer to give him
anything.
Mr. Kennedy. Were you thinking of giving him some golf clubs ?
Mr. DiSiMONE. No. Why sliould I ?
Mr. Kennedy. I am trying to find out from you. You never did?
Mr. DiSiMONE. No.
Mr. Kennedy. You never talked about it at all ?
Mr. DiSimone. No.
Mr. Kennedy. What about you?
Mr. Fero. No.
Mr. Kennedy. Did you every talk about giving him some golf
clubs?
Mr. Fero. I was sick at the time.
Mr. Kennedy. Just answer the question.
Mr. Fero. No, sir.
Mr. Kennedy. You never did ?
Mr. Fero. No, sir.
Mr. Kennedy. You never talked about giving him or making a gift
to him of any kind ?
Mr. Fero. I needed more money than anybody else.
Mr. Kennedy. Did you ever talk about that?
Mr. Fero. No, sir.
Mr. Kennedy. Were you ever told the State troopers were looking
into this matter?
Mr. Fero. I had no business to be told.
Mr. Kennedy. What is that ?
Mr. Fero. Not that I know of.
Mr. Kennedy. What about you, Mr. DiSimone? Did you ever
hear that State troopers were looking into this matter ?'
Mr. DiSimone. No ; I never heard of it.
Mr. Kennedy. You never did ?
8010 IMPROPER ACTRITIES IN THE Ix\BOR FIEI.D
Mr. DiSiMONE. No.
Mr. Kennedy. You were never warned by Mr. Piscitelli they were
looking into it.
Mr. DiSiMONE. No.
Mr. Kennedy. Then the testimony of the previous witness is com-
pletely false ; is that right, as far as you are concerned ?
Mr. DiSimone. Yes, sir ; as far as gambling is concerned.
Mr. Fero. That is right; I had a lot of trouble with that boy trying
to get him out of the card games to go and work.
Mr. Kennedy. He was always in the card game ?
Mr. Fero. He shot dice and played crap more than anybody else,
and they played among everybody"; and, in other words, they would
start it up and they would play.
Mr. Kennedy. So his testimony about the three if you is com-
pletely incorrect ?
Mr. Valentino. I will swear to that. It is wrong about me; I
ain't never done anything what he says.
Mr. Kennedy. That is all for now.
The Chairman. You may stand aside ; call the next Avitness.
Mr. Kennedy. Mr. Joe Sylvester.
We will have three witnesses — and, Mr. Michael Williams, and Mr.
Ormond Curci.
The Chairman. Mr. Sylvester, Mr. Williams, and Mr. Curci, will
you come around ?
Do you, each of you, solemnly swear that the evidence, given before
this Senate select committee, shall be the truth, the whole truth, and
nothing but the truth, so help you God.
Mr. Sylvester. I do.
Mr. Williams. I do.
Mr. Curci. I do.
TESTIMONY OF JOE SYLVESTER, MICHAEL WILLIAMS, AND
ORMOND CURCI
The Chairman. Beginning on my left, state your name, your place
of residence, and your business or occupation.
Mr. Williams. My name is Michael Williams. I live at 217 Vir-
ginia Avenue, Brooklyn Terrace, Wilmington, Del. I belong to the
Operating Engineers local, and I belong to the local about 2 years.
The Chairman. Is that 542?
Mr. Williams. Yes, sir. I worked on the Tidew^ater job.
The Chairman. And the next one.
Mr. Curci. My name is Ormondo Curci, and I live at 2652 South
Wornock Street, Philadelphia, Pa. I am no longer a member of
local 542, but at the time of the Delaware City job, I was. I was an
A man.
The Chairman. On the Tidewater job, you were a member of the
union ?
Mr. Curci. Yes, sir, I was, sir; and I w^as an A man.
The Chairman. And you worked on that job ?
Mr. Curci. I worked on the Tidewater job, yes.
The Chairman. And the next one.
IMPROPER ACTIVITIES IN THE L.4B0R FIELD 8011
Ml". Sylvester. My name is Joseph F. Sylvester, 514 North Ford
Avenue, Wihnington, Del., and I have been a member of local 542
since 1946. I also worked on the Tidewater job.
The Chairman. Proceed.
Do you gentlemen waive counsel ?
Mr. Sylvester. We do.
Mr. Williams. We do.
Mr. CuRci. We do.
Mr. Kennedy. How long were you working down on the Tidewater
job?
Mr. Syl^t:ster, Approximately 5 months.
]Mr. Kennedy. During what period of time ?
Mr. Sylvester. September of 1955 to January of 1956.
Mr. Kennedy. What kind of work were you doing down there?
Mr. Sylvester. I was a crane operator.
Mr. Kennedy. Now, while you were down there and working was
there any gambling going on ?
Mr. Sylvester. Quite a bit.
Mr. Kennedy^. Could you describe when it was taking place, and
who was participating and who was responsible for it?
Mr. Syl\t:ster. As far as the crap games were concerned
Mr. Kennedy. What wei-e the hours of the crap game ?
Mr. Sylvester. On a rainy day they would start about quarter after
8 or 8 : 30 in the morning, and continue all day.
During the working day, when the sun was shining, they would
start from 11 : 30 or quarter to l!^ to maybe quarter to 1 in the after-
noon.
Mr. Kennedy. Were they very active crap games ?
Mr. Sylvester. Very active.
Mr. Kennedy. Was it just a group of men just standing around
and deciding they would play craps or maybe cards ?
Mr. Sylvester. No, sir, it seemed as though when Keggy walked
in or whoever happened to have the dice. They threw the dice on the
table and fellows would group around the table and they would start
shooting dice.
Mr. Kennedy. Did it appear to you that it was organized ?
Mr. Sylvester. Yes, it did.
Mr. Kennedy. Now, how do you reach the conclusion that it was
organized ?
Mr. Sylvester. Because it seemed as though the three, Keggy,
DiSimone, Fred Fero and Joe Valentino, it seemed as though they
were the wrong bettors and there was a lot of other fellows that were
trying to bet the dice wrong.
Mr. Kennedy. What do you mean by "wrong bettors" ?
Mr. Sylvester. They would bet the dice wrong, and not to make
the numbers.
Mr. Kennedy. Is that what the house does ?
jNIr. Sylvester. Usually, yes.
Mr. Kennedy. Now, that took place for about an hour every day,
on working days, on the days the sun was out ?
Mr. Sylvester. I would say so.
Mr. Kennedy. Was there any other kind of gambling that took
place ?
8012 IMPROPER ACTIVITIES IN THE LiABOR FIELD
Mr, Sylvester. There was horse bets being recorded and also were
numbers being recorded down there.
Mr. Kennedy. 'Wlio was doing that ?
Mr. Sylvester. To my knowledge, and that I had seen, some of the
slips was Fred Fero, and Paris DiSimone.
Mr. Kennedy. Fero and DiSimone ?
Mr. Sylvester. Yes, sir.
Mr. Kennedy. Tliey were the ones actually making the bets ?
Mr. Sylvester. Holding the bets ; yes, sir.
Mr. Kennedy. Did you see that actually taking place, yourself ?
Mr. Sylvester. Yes, sir.
Mr. Kennedy. You heard their testimony before the committee, and
they denied it emphatically, that they had ever done anything similar
to this, or never participated at all. You say that you saw them do it?
Mr. Sylvester. I definitely did, and I think if they had the oppor-
tunity, they would change their story.
The Chairman, How many times did you see them do it ?
Mr. Syiv^ster. Is so happened to be, I ate in the engineers shanty
2 or 3 times a week and that is how often I would see them.
The Chairman. Were they soliciting the bets ?
Mr. Sylvester. Yes.
The Chairman. You mean inviting the men to bet ?
Mr. Sylvester. Well, more or less if a fellow would bet a horse, he
only had to bet one horse and he was to see him every day during the
week, every opportunity that he could get to see him place a bet.
The Chairman. What I am trying to determine is whether they
were around there soliciting bets, whether they were actually operating
a betting enterprise?
Mr. Sylvester. Yes, sir.
The Chairman. You know that, do you ?
Mr. SYL^TSTER. Yes, sir.
The Chairman. All right.
Mr. Kennedy. How did they get to the men on the jobs? Was
there any betting done with the men that were actually on the field
doing work on jobs?
Mr. Sylvester. Yes, sir ; there was.
Mr. Kennedy. How would they do that?
Mr. Sylvester. Freddy Fero was a field foreman and he had access
to a pickup truck, and he could run around and more or less take the
bets from the boys that were wanting to place them or stop the crane
operator if he wanted to place a bet, and show him the form.
Mr. Kennedy. He would go around in the pickup truck, and take
the bets to the men in the field
Mr. Sylvester. Yes, sir.
Mr. Kennedy. Wlio would do that
Mr. Sylvester. Freddy Fero.
Mr. Kennedy. And you heard him deny that he ever participated in
that?
Mr. Syla^ester. Yes.
Mr. Kennedy. And you say that testimony is false ?
JNIr. Sylvester. Yes.
Mr. Kennedy. And you are telling the tiTith to the committee ?
Mr. Sylvester. Yes.
IMPROPER ACTrV'ITIES IN THE LABOR FIELD 8013
The Chairman. Did you lose or win money ?
Mr. Sylvester. I never shot dice down tliere.
The Chairman. You never shot dice ?
Mr. Sylvester. No, sir.
The Chairman. Did you place horse bets ?
Mr. Sylvester. No, sir.
The Chairman. Did you bet on any of the rackets ?
Mr. Sylvester. No, sir.
The Chairman. You placed no bets ?
Mr. Sylvester. No, sir.
The Chairman. So you are not a poor loser and a poor sport in your
complaint ?
Mr, Sylvester. No, sir.
The Chairman. You had no bets, and you lost nothing, and you won
nothing ?
Mr. Sylvester. That is correct.
The Chairman. Is that correct ?
Mr. Sylvester. I played cards one time.
The Chairman. You played cards one time ?
Mr. Sylvester. Yes, sir.
The Chairman. Proceed.
Mr. Ivennedy. I will come back to you later, Mr. Sylvester.
I will move on to Mr. Curci.
Mr. CuRCi. Yes, sir.
Mr. Kennedy. You say you were in the Operating Engineers ?
Mr. CuRCi. I was at one time.
Mr. Kennedy. And what is your present occupation ?
Mr. CuRci. I am salaried by my parish church and I am a sexton,
bus driver, and a few other odds and ends connected with the church
work.
Mr. ICennedy. You work for a church ?
Mr. CuRci. I work for a Catholic church.
Mr. Kennedy. And at one time you studied for the priesthood, did
you?
Mr. CuRCi. I did, sir, one time, for a little over a year. I was at
St. Joes in Bordentown, N. J.
Mr. Kennedy. And now you work for the church ?
Mr. Curci. Yes, sir.
Mr. Kennedy. Before that, prior to that time you were in the Oper-
ating Engineers ?
Mr. Curci. I was, sir.
Mr. Kennedy. And you worked down on the Tidewater job ?
Mr. Curci. Yes, sir.
Mr. Kennedy. Was there any gambling going on in the Tidewater
job?
Mr. Curci. Yes, sir.
Mr. Kennedy. Was it active ?
Mr. Curci. Very active, sir.
Mr. Kennedy. First, on the crap and dice and the cards, wnere and
when would that take place?
Mr. Curci. There was they call a change house for the engineers to
change their clothes and what not, and around noontime, a little before
21243— 58— pt. 20 7
8014 IMPROPER ACTIVITIES IN THE LABOR FIELJ>
the noontime whistle would blow, the games would begin, and at times
they would extend well after the work bell sounded.
Mr. I^ENNEDY. Was it organized gambling ?
Mr. CuRGi. 1 would say it was, due to the fact there was the same
constant wrong bettors, as Jo called them, every day.
Mr. Kennedy. Who did you feel or understand it was organized by ?
Mr. CuECi. I would mention Keggy — I am sorry, Paris DiSimone
and Fred Fero were the ones.
Mr. Kennedy. The two mainly responsible ?
Mr. CuRCi. The two constantly wrong betters, and laying the odds,
day after day.
Mr. Kennedy. Did you go in and bet yourself ?
Mr. CuRCi. Yes, I did, sir.
Mr. Kennedy. Did you participate actively ?
Mr. CuRCi. Yes, sir.
Mr. Kennedy. Did you lose much money ?
Mr. CuRCi. On the whole, my time at the job there, I did.
Mr. Kennedy. You lost quite a bit of money ?
Mr. CuRCi. I can't quote any figures, but I did lose some money.
Mr. Kennedy. Was there any other kind of gambling taking place ?
Mr. CuRCi. There were horse bets.
Mr. I^nnedy. Wlio was taking the horse bets ?
Mr. CuRCi. Paris DiSimone, and Fred Fero.
Mr. Kennedy. And what other kind of gambling was going on?
Mr. CuRCi. To my knowledge, numbers.
Mr. Kennedy. Numbers ?
Mr. CuRci. Yes, sir.
Mr. Kennedy. Wlio was doing that ?
Mr. CuRCi. Also the same two fellows, Paris DiSimone and Fred
Fero.
Mr. Kennedy. Do you knoAv of any football pools or baseball pools ?
Mr. CuRCi. I do not.
Mr. Kennedy. That is the numbers and the horse book and
Mr. CuRCi. And craps and cards.
Mr. Kennedy. They were all taking place and you say that Fero
and DiSimone were active in that?
Mr. CuRCi. Yes, sir.
Mr. Kennedy. And they were the ones that were operating it?
Mr. CiTRci. Yes, sir ; to my knowledge.
Mr. I^NNEDY. How would Fero and DiSimone take the bets of the
men in the field ?
Mr. CuRCi. As Jo has already stated, Fero had access to a pickup
truck, due to him being field foreman, and he would run from ma-
chine to machine all over the job, taking bets and showing the race
form to the fellows so they could pick a horse, and stuff like that.
And at times Paris DiSimone would borrow Fred Fero's truck and
do likewise.
Mr. Kennedy. Now, you have heard the testimony of Mr. Fero,
and Mr. DiSimone ?
Mr, CuRCi. Yes, sir, I did.
Mr. Kennedy. And their testimony is directly in contradiction with
your testimony ?
Mr. CuRCi. Definitely, sir.
Mr. Kennedy. Are you telling the truth to the committee?
IMPROPER ACTIVITIES IX THE Lu\BOR FIELD 8015
Mr. CuRCi. I swear I am, sir.
Mr. Kennedy. Now, what was the situation^ ^'ou were in the
Operating Engineers, and associated with Mr. Underwood. Did
you have any difficulty in the Operating Engineers {
Mr. CuRCi. After it was pretty well known that I did become an
Underwood man, I did find work rather difficult to get.
Mr. Kennedy. What about tliat, did you have any tiouble at meet-
ings ?
Mr. CuRCi. Yes, sir.
Mr. Kennedy. Speaking your mind ?
Mr. CuRCi. Yes, sir; and I can quote some statements. One was
told by me while at a union meeting, if I didn't watch my words
on the union floor, I would get hurt.
Mr. Kennedy. When you were trying to speak at union meetings,
were you harassed in any way ?
Mr. CuRCi. I was slapped behind the head, and maybe tugged by
my clothes and told to sit down, and sworn at, most foul language
you ever heard in your life was expressed at those union meetings,
directly at me, and other men.
Mr. Kennedy. That is when you were trying to participate ?
Mr. CuRCi. That is trying to express my opinion on different things.
Another time I was told by Mr. John Piscitelli that I shouldn't get
too familiar, while I was on one particular job, with Joseph Syl-
vester, and Louis Antonio. I became friendly with them and I
wanted to make personal friends with them but was told by the mas-
ter mechanic that I should not become too familiar with them and
it wasn't good for me. At the time I did not know.
Mr. Kennedy. Who was the master mechanic ?
Mr. CuRCi. John Piscitelli.
Mr. Kennedy. He told you to stay away from thein i
Mr. CuRCT. That is right, sir; if I wanted to keep working and
what not.
Mr. Kennedy. Now, Mr. Williams.
Mr. Williams. Yes, sir.
Mr. Kennedy. You have been in the union for how long ?
Mr. Williams. Approximately 2 years, sir.
Mr. Kennedy. And you worked down on this Delaware job?
Mr. Williams. I did ; yes sir.
Mr. Kennedy. Over what period of time?
Mr. WiLLLVMS. Pardon me.
Mr. Kennedy. For what period of time ?
Mr. Williams. I worked there about 3 months, sir.
Mr. Kennedy. About 3 months ?
Mr. Williams. Yes, sir.
Mr. Kennedy. During when ?
Mr. Williams. April 1956, 1 started there.
Mr. Kennedy. For about 3 months ?
Mr. Williams. Yes, sir.
Mr. Kennedy. Was there any gambling going on ?
Mr. Williams. Yes, sir.
Mr. Kennedy. Was it active gambling?
Mr. Williams. Yes, sir ; very active.
Mr. Kennedy. Was there craps and cards ?
8016 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Williams. Yes, sir.
Mr. Kennedy. When did that go on i
Mr. Williams. Well, if it was a bad day, say, for instance, it was
raining, and the men couldn't work outside, the crap game would start
about 8 : 30 or around there, and continue no through the day, if the
weather was still bad. If the weather cleared up, quite a few of them
would go to work and possibly the game would carry on all day.
Mr. Kennedy. And who was organizing the game?
Mr. Williams. Well, to my knowledge, I have always noticed
Keggy, nicknamed.
Mr. Kennedy. That is DiSimone ?
Mr. Williams. Yes, sir; and he would also bring the dice in, and
that is the only man I ever saw bring the dice in.
Mr. Kennedy. So he was the one responsible in your estimation '?
Mr. Williams. Yes, sir.
Mr. Kennedy. Was there any other kind of gambling gomg on?
Mr. Williams. There were card games going on, and also horse
betting, and number betting.
Mr. Kennedy. Wlio was participating in that, and who was respon-
sible for that ?
Mr. Williams. The only one that I would ever see take any horse
betting or number betting was Keg^y.
Mr. Kennedy. But j^ou did see him ?
Mr. Williams. Yes, sir.
Mr. Kennedy. Did you take any bets from him yourself ?
Mr. Williams. No, sir ; I never did.
Mr. Kennedy. But you did see him taking bets ?
Mr. Williams. I have seen men go up and place bets with him.
Mr. Kennedy. Was there much money bet on these games ?
Mr. Williams. I couldn't say exactly how much money, but I have
seen money exchanged through his hands.
Mr. Kennedy. What about on the crap games ? How much would
be on the table on a roll ?
Mr. Williams. Well, the most money I ever saw shot across the crap
table was about $500 at one time
Mr. Kennedy. On a single roll ?
Mr. Williams. Yes, sir.
Mr. Kennedy. Did some of the men lose their whole salaries ?
Mr. Williams. Yes, sir.
Mr. Kennedy. Do you know of anyone who lost his week's salary ?
Mr. Williams. Myself, particularly.
Mr. Kennedy. You lost a week's salary ?
Mr. Williams. Yes, sir.
Mr. Kennedy. Now, Mr. Curci, did you lose your salary, also ?
Mr. Curci. Once ; yes, sir.
Mr. Kennedy. Your whole week's salary ?
Mr. Curci. Yes, sir.
Mr. Kennedy. What did you do ?
Mr. Curci. I had to take board money home, and I asked soine fel-
lows to lend me some money and I was refused, and Keggy loaned it to
me, DiSimone.
Mr. Kennedy. How did you happen to go to Keggy ?
Mr. Curci. It was around the job that he was lending money.
DilPROPLR ACTIMTIES IX THE LABOR FIELD 8017
Mr. Kennedy. Was it understood that he would lend money for
interest ?
Mr. CuRci. At that time it was 6 for 5.
Mr. Kennedy. Did you borrow money from him ?
Mr. CuRCi. Yes, sir ; I did.
Mr. Kennedy. Approximately how much did you borrow ?
Mr. CuECi. It wasn't less than $30, and it wasn't more than $50.
Mr. Ivennedy. How do you reach that ?
Mr. CuRci, Well, I had to take $30 board money, so I know I
wouldn't ask for less than $30, and I wouldn't ask for more than $50
because I wouldn't want more than $20 spending money. And if I
did ask for $50, that is the reason.
Mr. Kennedy. It was between $30 and $50 that you borrowed ?
Mr. CuRCi. Yes, sir.
Mr. Kennedy. And you had to give him $6 for every $5 that you
borrowed ?
Mr. CuRCi. Yes, sir.
Mr. Kennedy. Was it understood on the job that you could borrow
money from Keggy ?
Mr. CuRCi. It was pretty popularly known, I would say.
Mr. Kennedy. And you actually did that ?
Mr.CuRCi. Yes, sir ; I did .
Mr. Kennedy. You have heard Mr. Keggy, or Mr. DiSimone testify
that he did not participate and he did loan money at this rate ?
Mr. Ctjrci. That is incorrect, sir.
Mr. Ivennedy. You actually borrowed it from him ?
Mr. CuRci. I borrowed it from him myself.
Mr. Kennedy. Let me ask Mr. Sylvester.: Did the engineer, the
master mechanic, Mr. Piscitelli, did he know this was going on?
Mr. Sylvester. I think so.
Mr. Kennedy. Do you know ? Did you ever see him in the room ?
Mr. Sylvester. Yes, sir ; I did.
Mr. Kennedy. You saw him in the room while the gambling was
taking place ?
Mr. Sylvester. Two or three times that I had seen him, the game
was just about to start, and he walked out of the shanty.
Mr. Kennedy. Do you know of your own knowledge whether he
actually knew that the gambling wfls taking place ?
Mr. Sylvester. Yes. I think that he actually knew the gambling
was going on.
Mr. I^NNEDY. Do any of you gentlemen know if he knew he was
there?
Mr. Williams. I do.
Mr. KENNEDY. He was actually there when the gambling was tak-
ing place ?
Mr. Williams. For one instance, he came in to call for me and
my operator, and it happened about 20 minutes to 3, and it was a
rainy day and we all stayed in there, and we were playing cards and
shooting crap. And he came in about 20 minutes to 3 for my operator
and myself to go out and load a couple of trucks.
Mr. Kennedy. He actually came in while the gambling was going
on?
Mr. Williams. Yes, sir.
Mr. Kennedy. Did he attempt to break it up at that time ?
8018 liMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Williams. Not at all ; no, sir.
Mr. Kennedy, Was there any discussion about the State police
coming ?
Mr. Williams. Yes, I have heard that quite often, and, for in-
stance, before, before the game started, word would be passed around
that the State police possibly would be in, and there wouldn't be
«-ny game that day. Or a lot of times it would be broken up during
the middle of the game.
Mr. Kennedy. That the State police might be coming in and you
would have to break up the game ?
Mr. Williams. Yes, sir.
Mr. Kennedy. But you always received word prior to the time
tliat the State police got there to break the game up ?
Mr. Williams. That is right.
Mr. Kennedy. Is it true that the gambling and the different kinds
of games started at 8 o'clock in the morning, and lasted right straight
through the day ?
Mr. Williams. Especially on rainy days, it has started early in the
morning.
Mr. Kennedy. Mr. Curci, was there any discussion about making
any gift to Mr. Piscitelli ?
Mr. Cltrci. Never, to my knowledge.
Mr. Kennedy. Do you know of anything ?
Mr. Sylvester. Yes ; I do.
Mr. I^nnedy. Mr. Sylvester, all right.
Mr. Sylvester. Keggy approached me and stopped at my home one
evening and asked me if I thought I could get him a set of golf clubs,
and they wanted to present them to tlie master mechanic, John
Piscitelli.
Mr. I^NNEDY. He came by your house and asked if you thought it
■was possible to get a set of golf clubs for him ?
Mr. Sylvester. To give to Johnny Piscitelli.
Mr. Kennedy. Yes. Would he come to you ?
Mr. Sylvester. I play quite a bit of golf, and I enjoy the game, and
they had all heard me talk about playing golf and I took quite a bit of
ribbino- about it and different things like that.
Mr. Kennedy. What did you say ?
Mr. Sylvester. I told him I would try to price a set for him, and I
talked to a couple of pro friends of mine, and I think that they quoted
a price of about $190 for me to get a set of golf clubs. About a week
or so later, Keggy stopped over to the house and he said, "Well, Curly
got the set of golf clubs for Johnny Piscitelli, and we had to give him
20 more dollars so he could finance the payments on the ^olf clubs."
So I said, "What was the score? Who was supposed to give him the
golf clubs ?" And Keggy said, "Well, we thought maybe it would be a
good gesture on our part, if Freddy and myself would give him a
set of golf clubs."
Mr. Ivennedy. ^¥ho was he referring to when he spoke of "Freddy" ?
Mr. Sylvester. Freddy Fero. And so I said, "What happened?"
He said, "Well, Curly went up to Philadelphia and got a set of golf
clubs and gave to Johnny the golf clubs himself and made Johnny
think as though Curly bought the clubs for himself."
Mr. Kennedy. Wlio is Curly ?
EVIPROPER ACTIVrTIEiS IN THE LABOR FIELD 8019
Mr. Syx,vester. I am doubtful of his last name. I think it is Am-
brosia, but I'm not sure.
Mr. Kennedy. Was he participating in these games ?
Mr. Sylvester. No, he had an A book, and to my knowledge he was
the only A man on the Tidewater job that collected top rate on a cherry
picker.
Mr. IvENNEDY. So he was receiving preferred treatment, in other
words ?
Mr. Sylvester. That is correct.
Mr. Kennedy. Now, did you ever hear of or know of any threat
made to any of the individuals ?
Mr. Sylvester. I do.
Mr. Kennedy. Who were in opposition to the group that was in
control of the union ?
Mr. Syl\^ster. Yes, I do. It was the Sinclair Refinery job at
Markus Hook, Pa. Johnny Piscitelli was also master mechanic on
that job.
One afternoon, right before quitting time, we were all gathered
in the garage to go out the gate at quitting time, and Johnny ap-
proached me and he said, "I want you to tell Ed Farmer something
for me," And I said
Mr. Kennedy. Who is Ed Farmer ?
Mr. Sylvester, Ed Farmer was one of the boys like us, fighting
more or less on Roy Underwood's side, and he was also one of the
petitioners that filed charges against the international union.
So I said, ""\¥liat do you want me to tell him ?" He said, "You tell
Ed Farmer he is going to wind up in the hospital like I did to Ray
Dawson when I sent him to the hospital." That was the end of the
quote.
So I forwarded the news to Ed over the phone.
Mr. Kennedy. You called him and told him ?
Mr. Sylvester. Yes, sir.
Mr. Kennedy. What was his reaction ?
Mr. Sylvester. More or less to expect something like that fi'om
that type of fellow.
Mr, Kennedy, Ray Dawson is the one who was knocked down ?
Mr, Sylvester. Johnny continued to gesture and tell me how big
Ray Dawson was, and that he had sent him to the hospital, although
I have never laid eyes on Ray Dawson. I don't know him.
Mr. Kennedy. He was the one on whom we had the testimony
yesterday, who was knocked down, and he still has the trouble with
his chin.
Mr. Sylvester. I read it in the newspapers, Mr. Kennedy, and I
don't know.
The Chairman. Are there any questions ?
Senator McNamara. I would like to ask Mr. Curci a few questions.
You indicated you participated in the crap game ?
Mr. Curci. Yes, I did, sir.
Senator McNamara. Did you bet right ?
Mr. Curci. Yes, I did, sir.
Senator McNamara. Could you bet wrong ?
Mr. Curci. I don't have that kind of money, sir.
Senator McNamara. This, I do not understand. Will you ex-
plain it?
8020 IMPROPER ACTIVITIES IN THE IxlBOR FIELD
Mr. CuRCi. To be a wrong bettor you have to lay the odds. A number
comes out and you lay the odds that the number won't come out, or a
7 will come out before the number and you are actually laying the
odds.
Senator McNamara. Wliat number are you talking about, 4, or 10,
or9?
Mr. CuRCi. Four and ten are even numbers and that is even money.
I am sorry, that is 2 to 1 on even numbers, or perhaps it is 3 to 2.
That is why I lost so much money. It has been quite a while since I
have played, and the figures have left my mind.
But Jo brought to my attention it is 2 to 1 on the even numbers
such as 4 and 10, and 3 to 2 on the odd numbers, 6 and 9. Seven is a
house number.
Mr. Kennedy. They had a regular layout there ?
Mr. CuRCi. All of the money is on the table.
Mr. Kennedy. But did they have a green padding, the way you
describe it ?
Mr. CuRCi, No, it was just a piece of plywood lying on practically
trestles, with a specially made backboard, and who it was made by I
don't know.
Senator McNamara. You indicated that you figured these guys who
were betting wrong were running the game, because they were betting
wrong. But you had the option to bet wrong if you had enough
money ; is that right ?
Mr. CuRCi. I have witnessed other small fellows like myself trying
to take wrong bets, and being overrun by these fellows that we have
mentioned, taking the bets before we can get in there.
Senator McNamara. They had more money and they covered them
faster and so on ?
Mr. CuRCi. That is right.
(Members of the select committee present at this point in the
proceedings : Senators McClellan, Ervin, McNamara, Goldwater, and
Curtis.)
Senator McNamara. But you nevertheless could have bet wrong?
Mr. CuRCi. I could have tried, sir.
Senator McNamara. You were not prevented from betting wrong?
Mr. CuRci. I could have tried ; yes, sir.
Senator McNamara. Everybody in the game had the option of
betting right or wrong ?
Mr. CuRCi. Yes, sir.
Senator McNamara. And playing the odds one way or the other?
Mr. CuRCi. That is right.
Senator McNamara. In answer to a question about Fred Fero, you
said you more or less saw him taking bets ?
Mr. CuRCi. Yes, sir.
Senator INIcNamara. What do you mean by more or less ?
Mr. CuRCi. Did I say more or less ?
Senator McNamara. That is what I understood.
Mr. CuRCi. I said definitely I saw him taking bets, pulling up to a
crane, a bulldozer, or such a thing as that, and get out of the truck,
and I saw the exchange of money, and a form sheet pulled out, such
as called an Armstrong, which has a listing of all the horses. A man
IMPROPER ACTlVlTIEiS IN THE LABOR FIELD 8021
was given the opportunity of picking a horse, the money was exchanged,
and Fred Fero would go on his way to the next person.
Senator ISIcNamara. In answer to the question of did you see him
take bets, you could say positively yes, you did see him ?
]\Ir. CuRCi. Yes ; I saw him take horse bets.
Senator McNamara. On rainy days, when card games and crap
games went all day ; did the men get paid on rainy days ?
Mr. CuRCi. A condition of the local is to guarantee 40 hours a week,
rain or shine.
Senator McNamara. Actually, when it was raining, you were all
getting paid for it, because that was the agreement?
Mr. CuRci. We all had to stand by ; yes, sir.
Senator McNamara. You had to stand by ?
Mr. Curci. Yes, sir. We were getting paid for standing by.
Senator McNamara. The contract required that you stay on the
job?
Mr. Curci. That is right, sir.
Senator McNamara. AVlien you didn't have any
Mr. Curci. When there is rain, it is hardly possible.
Senator McNamara. Did you report this gambling to the police?
Mr. Curci. No ; I never did, myself, never turned them in.
Senator McNamari. Do you know of anybody who did ?
]Mr. Curci. I believe I heard a statement made by Louis Lattanzio,
that he did go to the State police.
Senator McNamara. You don't know if he did or not ?
Mr. Curci. No ; I couldn't say that.
Senator McNamara. Why do you make such a protest about the
gambling now, when you were actually there and knew about it first-
hand, and were in a position to report it to the authorities, and you
didn't report it? I don't understand it. What brought this about?
Mr. Curci. At one time or another, I think, in everybody's life, they
realize a mistake, and it was a big mistake for me to condone such an
action. What I mean by that is that I actually played, and, therefore,
condoned it. But I am no longer a member of the local, and I would
like to see such things straightened out for the future, and anybody else
who might get involved in such a thing.
Senator McNamara. You have taken on quite a job for yourself, if
you are going to have a condition where people are forced to stand
around all day because it is raining, and they are going to do some-
thing to pass the time, you are going to take on this crusade to stop
them from doing it ? You have a big job.
Mr. Curci. I am not on a crusade.
Senator McNamara. You are, or you are not ; the way you describe
yourself having now this zeal for correcting these things that you now
realize are wrong, you could be termed a crusader on that basis, by your
own word.
Mr. Curci. Well, it is not a bad title.
Senator McNamara. So, you didn't report it to the police. You
recognize now that you should have ?
Mr. Curci. I should have, sir. I was unmarried at the time, and I
more or less could have afforded it more than the other fellows who were
married and who had a number of children. Those families must have
been very sad.
8022 IMPROPER ACTR'ITIES IN THE Ll\BOR FIELD
Senator McNamara. They would have been more happy if you had
stopped the game than to lose their money ?
Mr. CuEci. They must have been sad, due to the fact that their
husbands were gambling and losing house money.
Senator McNamara. That is all.
The Chairman. Is there anything further ?
You witnesses come forward. Mr. Lattanzio, Mr. Fero, Mr. Valen-
tino, and DiSimone. You others keep your seats.
Gentlemen, the Chair wishes to suggest to you that it is our practice
here, when there is definite, direct, conflicting testimony that clearly
indicates that perjury has been committed before this committee, to
send a transcript of this testimony to the Justice Department with the
request that they pursue it, with a view of determining who has com-
mitted the perjury, and taking prosecuting action accordingly. There
is no doubt that there has been positive conflict of testimony here.
It is not under circumstances where there could be any honest mistake
about it.
One of you, or some of you, about 3 on one side and about 4 on the
other, some of you have not told the truth.
I say I cannot see that there is any possible way there could be any
honest mistake. Therefore, it is my opinion that somebody has com-
mitted willful perjury before this committee.
Before, however, ordering the transcript sent to the Justice Depart-
ment, and before excusing each of you as a witness before the com-
mittee, I want to give you the last opportunity, if any of you want to
change your testimony, those of you who have not told the truth, and
you know it, if you want to change your testimony before this record
goes to Justice, you may now have an opportunity to do it.
I think it is only fair to let you know that we are going to take this
action. You may be willing to tell the truth before you leave the
committee; if not, the committee has no recourse except to take the
action indicated.
Do any of you want to change your testimony ?
Mr. Valentino. No, sir. I spoke the truth.
Mr. Lattanzio. I understand the colored fellow's name was men-
tioned. That is, it would be taking numbers on the job.
The Chairman. A colored fellow was mentioned, but I am not sure
his name was mentioned.
Mr. Lattanzio. George is the name that was mentioned.
The Chairman. Yes George was mentioned.
Mr. Lattanzio. I happen to know who the colored fellow is, and
he was a runner for them.
The Chairman. He was a runner for them ?
Mr. Lattanzio. Yes, sir.
The Chairman. Do any of you want to deny it ?
Mr. Valentino. I never did that.
The Chairman. You never did that ?
Mr. DiSimone. Yes ; I deny it.
The Chairman. Under oath, you deny what he said ; that he was
a runner for you ?
Mr. DiSimone. No ; he was no runner for me.
Mr. Fero. I deny it, too.
IMPROPER ACTIVITIES IN THE K\BOR FIELD 8023
The Chairman. All right. I think the record is made. With the
approval of the committee, this transcript will be referred to the
Justice Department for appropriate action.
Stand aside. You are excused.
Call the next witness.
Mr. Kennedy. Mr. John Piscitelli.
(At this point, Senator Goldwater withdrew from the hearing
room.)
(Members of the select committee present at this point in the pro-
ceedings: Senators McClellan, Ervin, McNamara, and Curtis.)
The Chairman. You do solemnly swear that the testimony you
shall give before this Senate select committee shall be the truth, the
whole truth, and nothing but the truth, so help you God ?
Mr. Piscitelli. I do.
TESTIMONY OF JOHN PISCITELLI, ACCOMPANIED BY COUNSEL,
GEORGE J. CHARLES
The Chairman. State your name, place of residence, and business
or occupation.
Mr. Piscitelli. John Piscitelli, 323 Pennewill Drive, New Castle,
Del. I have been an operating engineer since 1941.
The Chairman. What position do you hold in the union?
Mr. Piscitelli. Right now, I am a master mechanic.
The Chairman. You have counsel. Let the record reflect that Mr.
Charles appears as counsel for this witness, also.
Senator McNamara?
Senator McNamara. In reply to the question by the Chair, the wit-
ness said he held a position with the union of master mechanic. Is
that correct?
Mr. Piscitelli. That is not an official of the union. That is just
a workman's job.
Senator McNamara. Well, in reply to the question asked by the
Chair, what position do you hold with the union ? You said you were a
master mechanic.
Mr. Piscitelli. That is my mistake. I hold no position with the
union.
The Chairman. You are just a member?
Mr. Piscitelli. I am just a member.
The Chairman, xill right. I did not want to leave the record con-
fused at all. I thought you understood what I meant.
All right.
Mr. Ivennedy. Mr. Piscitelli, your father had a position with the
union ?
Mr. Piscitelli. He is business agent.
Mr. Kennedy. He is a business agent of the local ?
Mr. Piscitelli. That is correct.
Mr. Kennedy. For how long has he been business agent ?
Mr. Piscitelli. From 1941 to 1948, and then from 1952 to the pres-
ent time.
Mr. Kennedy. He was kicked out after the union took over and got
their own autonomy ?
8024 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. PisciTELLi. I wouldn't say he was kicked out. He was voted
out.
Mr. Kennedy. Was he voted out ?
Mr. PisciTELLi. Yes.
Mr. Kennedy. Was he voted in in 1941 ?
Mr. PisciTELLi. No ; he was placed in.
Mr. Kennedy. Was he voted in in 1952 ?
Mr, PisciTELLi. In 1952 he went back in.
Mr. ICennedy. Was he voted in ?
Mr. PisciTELLi. No.
Mr. I^nnedy. Actually, when they had an election, they voted
against him ?
Mr. PisciTELLi. Actually, there was no business agents put on the
ballot at that time.
Mr. Kennedy. But the answer to the question is the only time they
had an election, they voted him out, is that right ?
JSIr. PisciTELLi. Actually, he wasn't on the ballot in 1948.
Mr. Kennedy. He was appointed in 1941 when the international
was running the union.
Mr. PisciTELLi. Right.
Mr. Kennedy. The first time the union had their own autonomy,
and the first time they had an election, he was voted out ; is that right ?
Mr. PisciTELLi. You could say he was voted out.
Mr. Kennedy. He wasn't voted in ?
Mr. PisciTELLi. He wasn't voted in.
Mr. Kennedy. And once the international took it over again he was
put back in, is that correct ?
Mr. PisciTELLi. That is correct.
Mr. Kennedy. He was never elected to a job in the local ?
Mr. PisciTELLi. No.
Mr. Kennedy. You have been a master mechanic for how long ?
Mr. PisciTELLi. Since 1953.
Mr. Kennedy. You worked on the Delaware job ?
Mr. PisciTELLi. I did.
Mr. Kennedy. And you were a master mechanic down there ?
Mr. PisciTELLi. Correct.
Mr. Kennedy. In that position, you had control over who should
be hired ?
Mr. PisciTELLi. No, not completely.
Mr. Kennedy. Well, at least to a large degree you had control ?
Mr. PisciTELLi. Yes.
Mr. Kennedy. Was there gambling going on in that job that you
knew of ?
Mr. PisciTELLi. The only gambling I knew of was during the noon
hour and rainy days.
Mr. Kennedy. From 12 to 12 : 30 ?
Mr. PisciTELLi. Yes.
Mr. Kennedy. Did you ever know of any other gambling that was
going on ?
Mr. PisciTELLi. Not to my knowledge.
Mr. Kennedy. You never knew of any other ?
Mr. PisciTELLi. No.
Mr. Kennedy. And the testimony that you knew that this was all
taki/ig place is incorrect ?
IMPROPE'R ACTIVITIBS IN THE LABOR FIELD 8025
Mr. PisciTELLi. That is correct.
Mr. Kennedy. You didn't know that ?
Mr. PisciTELLi. I did not know it,
Mr. Kennedy. Did you know there were numbers ?
Mr. PisciTELLi. No.
Mr. Kennedy. Did you know there were horse pools ?
Mr. PisciTELLi. No.
Mr. Kennedy. Baseball pools ?
Mr. PisciTELLi. No.
Mr. Kennedy. Horseraces ?
Mr. PiscrrELLi. No ; I did not.
Mr. Kennedy. You knew there was gambling going on between
12 and 12 : 30 ?
Mr. PisciTELLi. 12 and 12 : 30 and rainy days, cards and crap games.
Mr. Kennedy. Were there big stakes in that gambling ?
Mr. PisciTELLi. I don't know. I never played in it.
Mr. Kennedy. Did you ever take any steps to try to break it up ?
]\Ir. PisciTELLi. Those men are over 21. As long as 1 didn't need
tliem, they could do what they wanted.
Mr. Kennedy. Did you find out whether there were big stakes ?
Mr. PisciTELLi. No.
Mr. Kennedy. Did you find out whether it was organized ?
Mr. PisciTELLi. No.
Mr. Kennedy. You didn't look into it at all ?
Mr. PisciTELLi. It was amongst the operators. No.
Mr. Kennedy. You say, contrary to the testimony that has been
given to the committee, you didn't know it was going on in other
w^ays, and at other times ; is that right ?
Mr. PisciTELLi. That is right.
Mr. Kennedy. Have you been involved in any of the assaults on any
of the individuals?
(At this point Senator Curtis withdrew from the hearing room.)
Mr. PisciTELLi. At what time ?
Mr. Kennedy. Well, for instance, according to the testimony before
this committee this morning, you sent a threat to Mr. Farmer; is that
correct ?
Mr. PisciTELLi. I did not.
Mr. Kennedy. You never sent that threat ?
Mr. PisciTELLi. No.
Mr. Kennedy. And Mr. Sylvester's testimony, that you told him
that he would end up like Dawson if he didn't start behaving himself,
is false ?
Mr. PisciTELLi. That is false.
Mr. Kennedy. Absolutely incorrect ?
Mr. PisciTELLi. That is correct.
Mr. Kennedy. Were you involved in the assault on Roy Dawson ?
Mr. PisciTELLi. Yes, I was.
Mr. Kennedy. You were the one that knocked him down ?
Mr. PisciTELLL I did.
Mr. Kennedy. Wluxt year was that ?
Mr. PisciTELLi. 1916.
Mr. Kennedy. And you didn't send a message to Farmer that the
same thing would happen to him ?
Mr. PisciTELLi. That was 7 years later. I did not.
8026 IiMPROPKR ACTI\ITiES IX THE LABOR FIELD
The Chairman. Are there any questions ?
Senator McNamara. Yes, Mr. Chairman.
You indicate that you participated in the assault on Mr. Dawson ?
Mr. PisciTELLi. I was the one that did that. That was in self-
defense.
Senator McNamara. That was what I was about to ask you. Why
did you participate in an assault on somebody ?
Mr. PisciTELLT. May I explain that 'I
Senator McNamara. Yes.
Mr. PisciTELLi. I believe it was early in the year of 1946. It could
have been April or May. It was before the meeting started. There
was a group of us standing around waiting for Jasper Wliite to come
in and conduct a meeting.
Senator McNamara. Was this in the hotel ?
Mr. PisciTELLi. This is 1803 Spring Garden Street, Philadelphia.
There was a group of operators standing around talking, and Ray
Dawson, I believe his name is, was talking next to me, and I heard
"Dago" spoken, and I turned around and this Dawson was there, and
he said, "Yes. you, Dago," and a gesture was made and a hand went up.
"VVlien that happened, we began to wrestle around a little bit. We
wound up on the floor and he bit me on the face. When that hap-
pened, I called out that he was biting me, and that is when the men
broke it up.
Then Jasper T^Hiite came in and started the meeting.
Yesterday, when Underwood said that Joe Fay was there, that is
a falsehood. Joe Fay was not at that meeting.
Senator McNamara. I was not asking about Joe Fay. I was ask-
ing you why you participated in the assault, and your statement now
indicates that you did it in self-defense.
Mr. PisciTELLi. Self-defense.
Senator McNamara. You assumed when he used the word "Dago"
he was referring to you ?
Mr. PisciTELLi. lie was referring to me. I turned around.
Senator McNamara. Is that an insulting word ?
Mr. PisciTELLi. It is to me. I am an Italian, not a Dago.
Senator McNamara. Well, I have heard Italians called Dagos, and
they didn't seem to resent it. I suppose the manner in which it is
said enters into it.
Mr. PisciTELLi. It is the manner in which it is said. If it is a
friend of mine, I laugh it off; but Mr. Dawson, I never knew him.
It was the first time I laid eyes on the man.
Senator McNamara. That is all.
The Chairman. Are there any more questions ?
Mr. Kennedy. How old was Mr. Dawson then ?
Mr. PisciTELLi. At that time ? I do not know.
Mr. Kennedy. You have no idea ?
Mr. PisciTELLi. No.
Mr. Kennedy. Was he about your age ?
Mr. PisciTELLi, I couldnt' say.
Mr. Kennedy. I understand he is 59 now.
Mr. PisciTELLi. I don't know.
Mr. Kennedy. So he would be about 53 years old then ?
Mr. PisciTELi.1. Well, that was 12 years ago.
IMPROPEiR ACTIVITIES IX THE LABOR FIELD 8027
Ml-. Kennedy. About 47 years old? He was about 47?
Mr. PisciTELLi. I don't know.
Mr. Kennedy. How old are you?
Mr. PisciTELLi. 34.
Mr. Kennedy. And you were 22 ?
Mr. PisciTELLi. I was 22 years old.
]Mr. Kennedy. And you turned around
Mr. PisciTELLi. Well, there was a gesture made at me and I started
swinging, too, to defend myself.
Mr. Kennedy. He broke his jaw ; did he ?
Mr. PisciTELLi. I don't know.
Mr. Kennedy. You didn't find out or inquire ?
Mr. PisciTELLi. Well, a little later on — in fact, we met up with
Mr. Dawson. We set a meeting and we had dinner together, and
he told me his bills were $141, and I paid those bills.
Mr. Kennedy. Did you find out what the bills were for ?
]Mr. PisciTELLi. No. He says that is what it would come to, $141.
Mr. Kennedy. Did you find out who broke his jaw ?
Mr. PisciTELLi. He had no broken jaw.
Mr. Kennedy. Did you find out what the $141 was for ?
Mr. PisciTELLi. He said that was his medical bills.
Mr. Kennedy. That is all, Mr. Chairman.
The Cpiairman. You may stand aside.
Your testimony, Mr. Piscitelli, will also be sent to the Justice
Department.
Mr. Kennedy. Were there many jobs avaihible on the Delaware
job?
Mr. Piscitelli. I had approximately 800 men on the payroll. At
what time?
Mr. Kennedy. Well, were you looking around for men during that
period of time ?
Mr. Piscitelli. At what time? Wliatpart?
Mr. Kennedy. Well, the beginning of the job, when it was first
beginning in 1955.
Mr. Piscitelli. We started the job on March 15, and I went in there
with 5 men, and 3 of the men were from Delaware.
Mr. Kennedy. So you were hiring men all the time ?
Mr. Piscitelli. No. We hired men imtil April, and then we had
to wait 2 months for Kane College to be torn down before we could
go ahead with the job.
Mr. Kennedy. What month was that ?
INIr. Piscitelli. Well, we had to wait until June, until the semester
was over.
Mr. Kennedy. Did Mr. Lattanzio speak to you about trying to get
a job on that?
Mr. Piscitelli. Mr. Lattanzio stated he called me. That is a lie.
He never did call me. When he come down to the job to look for
work, he was already working at Du Pont. I questioned him on it,
and he said he was working at Du Pont.
Mr. Kennedy. Did you every try to keep him off the job ?
Mr. Piscitelli. I did not.
Mr. Kennedy. You never did ?
Mr. Piscitelli, I did not.
8028 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Did you know that he brought this NLRB action?
Mr. PisciTELLi. Yes. He came to my house that night, and told me
he brought action against me, and I said, "Why did you do that,
Lou ? You are going to work tomorrow morning."
Mr. Kennedy. So you put him at work right away ?
Mr. PisciTELLi. No. He was ah-eady notified that he was going
to go to work on Thursday morning, and I asked him what he was
going to do about it, and he said he was going to drop the case.
Mr. Kennedy. What about Sylvester?
Mr. PisciTELLi. The same thing.
Mr. Kennedy. And you hired him then ?
Mr. PisciTELLi. I called him by telephone.
Mr. Kennedy. That was after the NLKB action, however.
Mr. PisciTELLi. We didn't know about that. That happened that
morning.
Mr. Kennedy. It was just a coincidence ?
Mr. PisciTELLi. A coincidence.
Mr. Kennedy. They wait 7 months, and then when they go to
NLRB, they get a job the same day ?
Mr. PisciTELLi. Lattenzio was working at du Pont.
Mr. Kennedy. All right.
The Chairman. Call the next witness.
(At this point, the following members were present: Senators
McClellan, Ervin and Mc Namara.)
Mr. Kennedy. Mr. Charles R. Dawson, Mr. Chairman. This is a
different Mr. Dawson.
The Chairman. Be sworn, please. You do solemnly swear the
evidence you shall give before this Senate select committee shall be the
truth, the whole truth and nothing but the truth, so help you God ?
Mr. Dawson. I do, sir.
TESTIMONY OF CHARLES R. DAWSON
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Dawson. My name is Charles Raymond Dawson. I live at
1208 Collins Avenue, West Collingswood, N. J. I am an operating
engineer. At this time I would like to state I belong to 825, but in
1940 and 1948 up until that time, I was a member of 542.
The Chairman. Do you waive counsel ?
Mr. Dawson. I do, sir.
The Chairman. Thank you.
Proceed.
Mr. Dawson. I would like to state, if I am allowed to, that I volun-
teered to come down on my own.^
I wasn't subpenaed. I wasn't asked by anyone to come down.
The Chairman. You are here, then, voluntarily ?
Mr. Dawson. As a volunteer.
Tlie Chairman. Do you have something you wish to tell us ?
Mr. Dawson. Well, in regard to my being beat up on a meeting
night at 1800 something Spring Garden Street, in the regular meeting
hall of 542, it was on the week of the meeting of April 2, 1946. I
came into the meeting hall, walked directly to a member that I had
taken 2 or 'Z years previous to that to be a personal friend of mine,
IMPROPER ACTIVITIES IN THE LABOR FIELD 8029
and started to talk to him. But at that time the president — was
acting as president at that time — Mike Hogan, was on the rostrum
and ready to call the meeting to order. So I walked over to McCoole,
who was standing with his back to the wall
The Chairman. Who?
Mr. Dawson. Bill McCoole. He was a friend of mine. I started
to talk to him. I said "How are you, Bill?" I could tell right
off the reel there was something wrong. That was all I remember
saying or remembering what was doing until I was getting up off
the floor, and Johnny Piscitelli and his father were standing over
me with a group of other fellows, members, I suppose, but I didn't
know them. I was in a daze. I remember on the floor I was kicked
in the ribs, and as I was rising, getting up in a daze, one of them
said, and I think it was the young fellow, Johnny, he said, "I guess
that ought to do you for a while, and you can stay away from this
meeting."
He said, "We don't want you down here."
The Chajrman. What had you done to provoke that assault on you ?
Mr. Dawson. Well, I know of nothing. I know of nothing that
I done personal to either one of them. I don't know of anything
that I did to the local union. I had participated in trying to get
the trusteeship lifted from 542 at that time, and get Jasper White
out of tliere.
The Chairman. Who was Jasper Wliite ?
Mr. Dawson. He was the system supervisor at that time.
Mr. Kennedy. That was under Joe Fay.
Mr. Dawson. That is correct.
The Chairman. In other words, he was in charge of the local ?
Mr. Dawson. That is right.
The Chairman. Kepresentin^ the international president ?
Mr. Dawson. That is right, sir.
The Chairman. And he was directing the affairs of the local?
Mr. Dawson. That is right, sir.
The Chairman. And you wanted to get him out ?
Mr. Dawson. That is right.
The Chairman. And you had been active in that effort ?
Mr. Dawson. I had been ; yes.
The Chairman. Was that known ?
Mr. Dawson. Well, it was pretty generally known.
The Chairman. Had you received any warning not to come to
the meeting ?
Mr. Dawson. Well, I hadn't personally, myself, but members on the
job, and their family, and my wife had received a telephone call
the day that I went to the meeting, or the night that I went to the
meeting, and she advised me not to go.
The Chairman. Who ?
Mr. Dawson. My wife.
The Chairman. A^Hiy?
Mr, Dawson. She had received threats.
The Chairman. She had received threats?
Mr. Dawson. And told her to keep me away from that meeting.
Mr. Kennedy. Had you preferred charges against any of the
officers ?
21243— 58— pt. 20 8
8030 IMPROPER ACTRITIES IN THE LABOR FIElrD
Mr. Dawson. Jasper White I had preferred charges against, and
I had them in my pocket that night, and was going to present them,
and did, to the recording secretary at that meeting, after I got np off
the floor and a couple of my friends had to come in. They didn't
know what had happened, but they got ahold of me, and they wanted
to know where my coat was at. It was torn off. My book was lost
out of my pocket, my union book.
I thought that these charges were missing, but they were in another
pocket. So I searched for them. I went down and I laid them on
the table of the recording secretary, and he accepted them, and then
they took me to the hospital, a couple of friends. Earl Welsh, and
Henry Smith, who is deceased now.
The Chairman. T\nio did you prefer charges against at that time?
Mr. Dawson. Tom Barrett and Jasper "\^^iite.
The Chairman, Did you prefer your charges in writing ?
Mr. Dawson. Yes, sir.
The Chairman. And you placed them on the desk of the presiding
officer at that meeting after you had been assaulted ?
Mr. Dawson. That is right, sir.
The Chairman. I hand you a copy of the charges you referred to
against Brother Jasper White and Brother Tom Barrett. I hand you
what purport to be copies of them, or the original, signed by you, and
I ask you to examine tliem and state if 30U identify them.
(Document handed to the witness.)
Mr. Dawson. Yes.
The Chairman. You do identify them ?
Mr. Dawson. Yes ; I do.
The Chairman. Those are the letters of charges ?
Mr. Dawson. They are the ones.
The Chairman. And that you signed ?
Mr. Dawson. Yes.
The Chairman. They may be made exhibits 79-A and 79-B.
(The documents referred to were marked "Exhibits 79-A and 79-B"
for reference, and will be found in the appendix on pp. 8307-8308.)
The Chairman. Is there anything further ?
Senator McNamara.
Senator McNamara. When you say you participated in trying to
get the trusteeship lifted, what did you do ? How did you participate ?
Mr. Dawson. Well, we had to get members of 542 to sign local
autonomy papers.
Senator McNamara. Petitions ?
Mr. Dawson. Yes; petitions. I, for one, had a number of them,
and I had quite a few friends, and also good members, in the northern
part of the State, up around Harrisburg, Scranton, and Easton. I
myself over the week ends would go up there. Those fellows couldn't
attend meetings regularly. I would inform them of what was
going on.
Senator McNamara. How many signatures were obtained, in total ?
Mr. Dawson. Well, I couldn't give you that. Probably Roy Under-
wood could. But I know at one time that we come back with a couple
of hundred.
Senator McNamara. So you would assume that there were perhaps
a thousand or more signatures ?
Mr. Dawson. I imagine so, sir.
IMPROPKK ACTl\lTiE,S 1\ THE LABOR FIELD 8031
Senator McNamara. They were properly filed witli the interna-
tional, as far as you know ?
Mr. Dawson. They were filed in court.
Senator McNamara. In court ?
Mr. Dawson. Yes.
Senator McNamara. Wait a minute. You said you participated
in trying to get trusteeship lifted. But that w^asn't petitioning the
international president, but it was a petition to the court ?
Mr. Dawson. That is right, sir.
Senator McNamara. You made no effort to get that lifted within
the organization ?
Mr. Dawson. We couldn't do anything more, because every time we
got on the floor to talk about it we were put out of order, or wasn't
allowed to speak.
Senator McNamara. Under your constitution and bylaws, doesn't
an individual have a right to petition the international president ?
Mr. Dawson. They do have the right to.
Senator McNamara. But you didn't take that course ?
Mr. Dawson. No, sir.
Senator McNamara. Wlio typed the charges that you just identified
for the record ?
Mr. Dawson. The secretary for Mr. Erickson, who was manager
for Day & Zimmerman.
Senator McNamara. Are they contractors ?
Mr. Dawson. They are contractors, where I was employed at the
time.
Senator McNamara. The secretary for the employers' association
typed the charges for you that you were filing against the ofiicers of
the union ?
Mr. Dawson. Well, she was a secretary to Mr. Erickson, who
was project manager for Day & Zimmerman.
Senator McNamara. But, nevertheless, the employer ?
Mr. Dawson. That is ri^ht.
Senator McNamara. It is an unusual procedure.
Mr. Dawson. What is that, sir ?
Senator McNamara. That the employers' secretary would type the
charges against some union official for you.
3,rr. Dawson. Well, I was there, and I just asked her if she would
copy them down. I had written them out the night before, and I
asked her if she would copy them down, and she said sure. In the
meantime, I had gotten a letter from Mr. Erickson, signed by the
manager, because there had been some rumors around that I had
taken Tom Barrett's job. That is what the charges was about. And,
to verify that, I had nothing, and neither did Henry Smith, which
is deceased, have anything at all to do with it. He wrote a letter to
Jasper White, and I have a copy of it, and I also made a coj)y to
Jasper AlHiite.
(At this point, the following members were present: Senators
McClellan, Ervin, McNamara.)
Senator McNamara. The union you are now a member of is what?
Mr. Dawson. No. 825 of Jersey.
Senator McNamara. Is that in trusteeship ?
Mr. Daw^son. No ; it is not.
Senator McNamara. Has it been in trusteeship ?
8032 IMPROPER ACTIVITIES IN THE Ll\BOR FIEI.D
Mr. Dawson. Thcat is right.
Senator McNamara. It has been ?
]Mr. Dawson. Oh, no ; I am sorry. As well as I remember, it has
never been.
Senator McNamara. That is all, Mr. Chairman.
Senator Ervin. I would like to ask : Is this a fair statement of
your experience, that you have recounted; that you were beaten up
because }^ou favored to think, and express your honest thoughts as
an American citizen, that the members of the local ought to be re-
lieved of the trusteeship and permitted to have some voice in their
own affairs?
Mr. Dawson. Yes ; that is correct.
The Chairman. I understood Mr. Piscitelli to say something about
having dinner with you after that fight when he beat you up, and
that he paid or agreed to pay $146 and something for your hospital
bill, or medical bill ?
Mr. Dawson. He paid $150.
The Chairman. On your hospital bill or medical bill ?
Mr. Dawson. It was not stated for what, because I asked him at
the time, I said, "Why did you fellows do this?" The father said,
"Well, you know, the boy is just back from service, and young and
high tempered, and things like that happen."
The Chairman. Which one of them paid you the money ?
Mr. Dawson. The father.
The Chairman. The father paid you and not the one who testified
here today ?
Mr. Dawson. No.
Tlie Chairman. The one vv'ho is here is the son?
Mr. Dawson. That is correct.
The Chairman. And it was his father who paid you the money •
Mr. Dawson. That is right, sir.
The Chairman. Did you request payment ?
Mr. Dawson. No, sir ; I did not.
The Chairman. How did it come about ? I don't quite understand,
you got beat up and the next thing I hear you are out to dinner with
them. What is tlie explanation ?
Mr. Dawson. That is probably about April, around 1948, after the
first of the year. I had been appointed on the street as the busi-
ness agent. And I am very sorry, I would like to state, that I ever
accepted the job, because it certainly was not in accordance with my
belief. But there were so many members out and applying and ask-
ing for jobs at that time, I thought I could help them out. But ap-
parently, I did not do an awful good job of it. However, while I was
on the street. Jack Carter, years ago was acting as an assistant to
McDonald who had been put in there then to take charge of 542.
Jasper White was out, and I had worked for quite a time on the
street when Jack Carter said to me, "I have made arrangements for
you to meet Piscitelli tonight, he is down the street, and you can have
supper or anything with him, and they want to straighten something
out with you, and they think that they owe you something for the
abuse you went through."
The Chairman. You had dinner with them ?
Mr. Dawson. Pardon me.
The Chairman. Did you have dinner with them that night?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8033
Mr. Dawson. No; I did not eat anything. We did meet in a
restaurant.
The Chairman. But you did not eat ?
Mr. Dawson. No, sir.
The Chairman, they paid you the $150 ?
Mr. Dawson. $150.
The Chairman. There that night ?
Mr. Dawson. Not that night, no. They sent me a check, or his
father sent me a check, and I don't know whether it was on the Girard
bank but one of the banks.
The Chairman. Was that the time it was agreed that you were to
receive $150?
Mr. Dawson. Yes, sir.
The Chairman. At that meeting ?
Mr. Dawson. At the restaurant that night.
The Chairman. Where you met them at the restaurant ?
Mr, Dawson. Yes, sir.
The Chairman. How badly were you injured when you were as-
saulted ?
Mr. Dawson. Pretty bad, sir. I was taken to the Hanlon Hospital
and they did not want to discharge me that night and they did not
want to take the responsibility, but I lived in Coatesvilie which is
about 30 miles out, I insisted on going after being there bandaged
and they wanted to take X-rays and whatnot.
But I went home. Mr. Smith at that time drove me home, be-
cause he would not trust me driving alone. I went home that night
and I want to say that the worst part of it all was that when I
opened the door and my wife had had the threats made to her. I
told her not to turn the lights on, but she turned them on, and she
just went hollering and screaming for half of the night.
The next day she told me, "You must never go back to those meet-
ings, or have anything to do with those things again." I said, "The
majority of the engineers are all right, but this is a gang and someone
must fight them."
However, the next day, I was not able to work and the steward, who
was Smith, had taken me home, and he notified Mr. Erickson for Dan
and Zimmerman, and he told them that I would not be in, and what
had happened. In the meantime, I called up the local the day after-
ward, or 2 days afterward I called up and told them my union book
was lost out of my pocket. Milve Morgan said, "I have it here and I
want you to come down here and Jasper White wants to talk to you."
I said, "I am not able to come down today, but I will probably be
in, in a day or two."
So in a couple of days I went down and Jasper White was there.
Morgan gave me my book, and he said, "I am sorry, this should never
have happened to anyone."
Jasper was there, and he comes over and he says, "Look, I told you
before, I am running the local." And he said, "I want to tell you
something."
These charges, he brought them back and gave them to me, that you
have copies of — he brought them back and gave them to me and he
handed them to me — and he said, "You take those copies and go on
back and be a good boy and you won't have too much trouble."
8034 EVIPROPER ACTIVITIES IX THE LABOR FIE1,D
The Chairman. He was the supervisor, the one running the union's
affairs?
Mr. Dawson. That is right, sir.
The Chairman. Under Fay ?
Mr. Dawson. That is correct, sir.
The Chairman. Is there anything further you want to state ?
You volunteered to come down and is tliere anything further you
wish to state ?
Mr. Dawson. No ; I don't think so.
The Chairman. Are there any questions?
All right, thank you very much. You may stand aside.
Who is the next witness ?
j\Ir. Kennedy. I want to ask Mr. Homer Dawson to return to the
stand, Mr. Chairman.
TESTIMONY OF HOMER G. DAWSON— Eesumed
The Chairman. You were sworn yesterday, were you?
Mr. Dawson. Yes, sir.
The Chairman. You will remain under the same oath.
Mr. Kennedy. You were operating in the Delaware area, is that
right, of the local?
Mr. Dawson. Well, that is my home, sir.
]Mr. I^NNEDY. But you were in that area, that is where you were
doing your work ?
Mr. Daw^son. Yes, sir.
Mr. Kennedy. Now, you had your own separate meetings in Dela-
ware ?
Mr. Dawson. Yes, sir.
jNIr. Kennedy. I am talking now, since 1953.
Mr, Dawson. Yes, sir,
Mr. Kennedy. Maybe around the year 1955.
Mr. Dawson. After the 2-year lapse of meetings, they started hav-
ing meetings.
Mr. Kennedy. What period of time didn't you have any meetings
at all?
Mr. Dawson. I think there was one meeting in 1952, one in 1953
when McCarty got beat up, and I am quite sure that the next meeting
was in January of 1955. At that time, they set up what they called
district meetings, and had meetings in I believe it was five separate
districts within the jurisdiction of the union. One of them was in
Wilmington, Del.
Mr. Kennedy. "Wliat was the point of that ?
Mr. Dawson. Well, my theory is it was to divide and conquer, and
they said it was to get out to the members, although we had had
meetings in the areas under Mr. Underwood, the business agent held
meetings and kept tlie members informed. They said they were dis-
trict meetings, and
Mr. KJENNEDY. Who would run these district meetings ?
Mr. Dawson. Mr. Lavery.
Mr. Kennedy. What was his position ?
Mr. Dawson. He was the assistant supervisor of the local union.
Mr. Kennedy. Wlio else would run them ?
IMPROPER ACTIVITIES IX THE LABOR FIELD 8035
Mr. Dawson. Mr. Wharton presided at the first meeting that was
held ; in 1955 the rest of the time Mr. Lavery.
Mr. Kennedy. Were there any complaints about the terms of the
contracts ?
Mr. Dawson. Yes, sir, there were very many complaints about
many things.
Mr. Kennedy. Did you request any information regarding the
contracts ?
Mr. Dawson. Yes, sir.
Mr. Kennedy. And what response did you get ?
Mr. Dawson. Well, of course this was after a lapse of 2 years with-
out a meeting, and of course in that length of time we had a great
many complaints, and questions. We asked a great many questions,
and I would say that we haven't received an answer of any sort yet.
We just couldn't receive an answer as to what was going on.
Mr. Kennedy. To whom did you direct these questions?
Mr. Dawson. To Mr. Lavery.
Mr. Kennedy. And he would not give you any answers to ques-
tions?
Mr. Dawson. No, sir, I would say that we never received a direct
answer. We would get answers or stories, but I would say we never
received a correct answer as to the conditions within the union.
Mr. I^NNEDY. What about Mr. Piscitelli, Sr., did he attend some
of these ?
Mr. Dawson. Yes, he attended those meetings.
Mr. Kennedy. Did you find that on the terms of the contracts,
would you prove to your own satisfaction that they were not giving
you the correct story on the contracts and they were not telling you
the truth on the terms of the contracts ?
Mr. Dawson. At that time, sir, I wouldn't say that we asked a great
deal of questions. At that time I wouldn't say. We didn't know
what the contract was, and it had never been published, and we had
never voted on it, and of course we had a great many questions as to
what it was, and I would say we didn't get satisfactory answers.
Mr. Ivennedy. Did he ever subsequently bring any of the strong-
arm men in ? Were they brought into the meetings ?
Mr. Dawson. From the start of the meetings which I think was in
January of 1955, there were usually 15 or 4 carloads of people that came
down with him. They took no active part in the meetings, a couple
of times they attempted to participate and we informed them that the
meetings were in Delaware and for Delawarians and we wished it to
remain so, and they remained quiet.
After, I believe, it was the fourth meeting, one gentleman, Mr. Clark,
was questioning Mr. Lavery and I don't at the moment know what the
question was. Anyway Mr. Lavery said, "Well, look young fellow,
you are not big enough to talk to me like that. I will take you
outside."
Frank Lentino, over on the other side of the room, jumped up and
he said, "He is about my size, let me take the s. o. b. out."
He and several more jumped up and, of course, we on the other side
of the room stood up too, and grabbed a chair, and that was the
end of that meeting. I might say the end of all meetings in the State
of Delaware. We have not had one since. That was, I believe, in
March or April of 1955.
8036 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. You haven't had a meeting since March or April
of 1955?
Mr. Dawson. Not in the State of Delaware.
Mr. Kennedy. Were the police brought into this at all ?
Mr, Dawson. Yes, sir.
Mr. Kennedy, Was there ever an attempt to come back and have
another meeting ?
Mr, Dawson. After that meeting, Mr. Clark swore out warrants
against Mr. Lavery, and Mr. Lentino, and there was a meeting
scheduled, the meeting was set up for a certain day of the month;
at the next meeting, which incidentally at the Philadelphia meeting
had been announced by Mr. Lavery that people in Delaware seem to
resent outsiders coming in, and so he didn't want anybody from Phila-
delphia to go down to the Delaware meetings.
Nevertheless, at the next scheduled meetnig, Mr. Lavery came down
witli I would say 5 or 6 carloads down to the meeting. The police
Mr, Kennedy, Five or six carloads of people from Pennsylvania?
Mr. Dawson, Yes, sir. The police had warrants for the arrest of
Lavery and I./entino, and did arrest them before the meeting.
Mr, Kennedy, So the meeting never took place ?
Mr, Dawson, No, sir.
Mr. Kennedy. Were these 5 or 6 carloads sent back home? Is
that right?
Mr. Dawson. Well, they went back. yes.
Mr. Kennedy. From that time, the men from Delaware, did they
have difficulty getting jobs, and getting work?
Mr. Dawson. I would say they have had a great deal of difficulty,
sir.
Mr. Kennedy. They have been discriminated against by the local?
Mr. Dawson, Yes, sir, I would say so,
Mr, Kennedy, And so you support the testimony of Mr, Lattanzio
regarding that, and the difficulty that he had getting a job ?
Mr. Dawson. Yes, sir, I am well aware of the difficulty he had.
Mr. Kennedy, And you know of other instances where men in
Delaware had difficulty getting work ?
Mr. Dawson. They have had and they are still having, I might add.
Mr. Kennedy. That is because of the control that the local union
officials put in there by William E. Maloney over the jobs of the
members of the union ; is that right?
Mr. Dawson. I would say so ; yes, sir.
Mr. Kennedy. That is all.
The Chairman, Thank you. You may stand aside.
Mr. Kennedy. Mr. Kaye.
The Chairman. You do solemnly swear that the testimony you
shall give before this Senate select committee shall be the truth, the
whole truth, and nothing but the truth, so help you God ?
Mr. Kaye. I do.
TESTIMONY OF HOWARD JOSEPH KAYE
The Cpiairman. State your name, your place of residence, and your
business or occupation.
Mr. Kaye. Howard Joseph Kaye, R. D. No. 2, Appleby Road, New
Castle, Del., operating engineer with an A book.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8037
The Chairman. Do you waive counsel ?
Mr. Kaye. I do.
Mr. I^NNEDY. Mr. Kaye, how long have you been in the operating
engineers ?
Mr. Kate. Eight years.
Mr. Kennedy. And what section are you in ?
Mr. Kaye. A branch.
Mr. Kennedy. Now, were you associated with those who were at-
tempting to have trusteeship removed from the local ?
Mr. Kaye. Up until a couple of years ago I wasn't, sir, but in the
last couple of years I have been, yes, in the last 18 months or some-
thing like that.
Mr. Kjennedy. You are one of those who have been trying to get
your own local autonomy ?
Mr. Kaye. Yes, sir,
Mr. Ivennedy. Now, since the time that you joined with Mr. Under-
wood, have you had any difficulty or trouble with the officials of the
union that have been appointed by William E. Maloney ?
Mr. ICaye. I was assaulted at a union meeting one time.
Mr. Kennedy. Would you tell the committee what happened in
connection with that ?
Mr. Kaye. It was in July of 1956. Bill Hogan had the floor and
was asking something about the welfare fund, and there was a lot of
hollering going on and shouting and yelling, and telling him to sit
down,
Mr. Kjennedy. He was trying to get some answers to questions on
the administration of the welfare fund ?
Mr, Kaye, Yes, sir.
Mr, Kennedy. From the union officials ?
Mr. Kj^ye. Yes, sir.
Mr. Kennedy. And who was in the chair at tlie time ?
Mr. Kj^ye. Hank Lavery, and I got up and I asked Hank Lavery,
"Wliy can't this man speak ? You are running the meeting and you
should call for order."
And this John Wolgast, that Christaldi, was over to my left. He
jumped up and he said, "Sit down and shut up !" I said, "No, you
shut up!"
And he said, "You make me." And with that he came at me with
fists flying. I pushed him back, and then he came at me a couple of
more times and then we were fighting. They broke that up. The
meeting continued for — it didn't'last too long, and the meeting was
adjourned. _ When the meeting was adjourned, I didn't hear anybody
make a motion to adjourn it, and Johnny Testa was sitting a couple
of seats in from me, and he got up and asked Mr. Lavery, "Who made
the motion to adjourn?" I looked over to my right at him, and when
I did, I thought the ceiling came in or something, because I was on the
floor and being kicked and punched, and I worked my way to my
feet.
Mr. Kennedy. You were knocked down to the floor ?
Mr. Kaye. I went over backward in the chair, and I was just leaped
upon.
(At this point, the following members were present: Senators
McClellan and Ervin.)
8038 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. And after that they started kicking you when you
were down ?
Mr, Kate. Yes, sir.
Mr. Kennedy. "^Vlio was doing all of that 'i
Mr. Kaye. Well, Wolgast, I can name; Altamuro, he was there. I
didn't see Fero, but I was told he was one of the ones that was holding
me and hitting me. They gathered around in a group, and they tried
to make it look good in the meeting, and don't want too many guys
getting in it, to stop them. They hold you and they say "Break this
up," and at the same time they would be giving you side jabs.
Mr. Kennedy. They would be yelling 'oreak it up, and would be
kicking you 'i
Mr. Kaye. Yes. The crowd couldn't st'O, and tliey would get in
close and work on you.
Mr. Kennedy. Were you hurt badly A\hile you were on tlie ground ?
JNIr. Kaye. Well, I was bruised and pretty sore for a couple of days.
My face was swollen up.
Mr. Kennedy. Were you kicked in the face ?
Mr. Kaye. I don't know exactly what happened. I thought the
ceiling came in.
Mr. Kennedy. Were you finally able to get back on your feet?
Mr. Kaye. Yes, I worked my way back to my feet while it was still
going on, but they were holding me and punching me still.
Mr. Kennedy. One of them held you and the others punched you ?
Mr. Kayte. There was about four of them holding me. I worked my
way back to my feet and we were still tussling there, and they just
broke it up. just like that, of their own accord. I guess they thought
I had enougli or something.
Mr. Kennedy. All that brought this about was that you were trying
to get permission or supporting an individual's trying to ask the ques-
tion about the welfare fund ?
Mr. Kaye. I thought the chairman certainl}^ should conduct the
meeting orderlj^, so that the man could ask a question no matter what
he wanted to say, but to be heard, and then if somebody else wanted
the floor, that was their time to have it.
Mr. Kennedy. Have you had any problems, any difficulty with them
since then ?
Mr. Kaye. No ; I haven't, not since then.
Mr. Kennedy. Do you know of any collusive arrangements with
any of the employers or contractors up in the Philadelphia area ?
Mr. Kaye. Well, I worked on a job in the State of Delaware, where
the rate was $1 an hour less than what it called for in the contract.
Mr. Kennedy. You were getting paid a dollar less an hour on this
job that you were working on than the contract stipulated?
Mr. Kaye. Yes, sir; I was sent on tlie job by the business agent.
Mr. ICennedy. What job was that ?
Mr. Kaye. Standard Bithulithic Co.
Mr. Kennedy. How do you spell Bitludithic ?
Mr. Kaye. You have me there.
Mr. Kennedy. That is all right.
The Chairman. You were getting $1 an liour less. That would be
$8 a day less,
Mr. Kaye. Than what the contract called for; yes.
IMPROPER ACTrV'ITIES TK THE LABOR FIELD 8039
The Chairman. What did the contract call for and wliat did you
receive ?
Mr. Kaye. The exact rate on that particular machine I was running,
a heater-planer, under tlie contract was to be $3,885 an hour. I am
almost positive of that.
The Chairman. Wliat did you receive?
Mr. Kaye. $2.40.
The Chairman. $2.40?
Mr. Kate. Yes, sir.
The Chairman. Do you know why you were not paid the rates
called for in the contract ?
Mr. Kate. Well, when I went on the job, I assumed that it was a
job that you would normally .eo on, because there wasn't supposed to
be no contracts out like that. It was brought up at the meetings that
there was, and that was denied, that there was conracts like that
signed. I started tlie job and I asked the superintendent on the job
Avhat the rate was, and he said $2.40. I said "No, I have a copy of
the contract here. I will show you where it is $3,385."
He said, "No ; the office told me $2.40.
"They have a contract down there that says $2.40."
I said, "Well, I ain't going to stay on this job, then. I am going to
quit." He said, "How about staying another day until I can get
another man," and I said, "All right, I will stay 1 more day on the
job."
I did stay 1 more day. I went to the next union meeting, which, I
believe, was that evening, and I brought it up on the floor, and I had
a little trouble bringing it up, and when I did get the floor, first
Mr. Lavery denied that there was such a contract in existence, and
then he said, "Well, what company are you working for?" I told
him, and he said, "Well, we did sign a contract with tliem down tliere
for less money."
He finally admitted that it did happen.
The Chairman. Do you know why they would sign a contract with
this company for less money for the union members than with others ?
Mr. Kate. Well, I can't think of no legitimate reason, sir.
The Chairman. Sir?
Mr. Kate. I csuvt think of any legitimate reason. I can draw my
own conclusions.
The Chairman. Do you have any further information as to why
there was this particular contract ?
Mr. Kate. No, sir ; I do not. You are not told anything like that.
The Chairman. That is a pretty good spread there, the diiference.
It is $1 an hour on a $3,385 an hour job. I cannot understand. I can
understand why there might be a few cents difference, but I do not
understand that kind of arrangement. Do you?
Mr. Kate. No, sir ; I didn't.
The Chairman. Do you know whether they continued to pay that
lower rate after you quit?
Mr. Kate. Yes, sir. And there is more contracts being signed with
contractors with the lower rate.
The Chairman. There were other contracts signed with other con-
tractors with a lower rate?
8040 IMPROPER ACTIVITIES IX THE Lu\BOR FIEIiD
Mr. Kaye. Yes, sir, but not at that time there wasn't. That was
the first one they admitted to. They didn't want to admit to that one.
The Chairman. But subsequently they signed others?
Mr. Kaye. Yes, sir.
The Chairman. Do I understand that this discrimination con-
tinued, that in some instances they would hold a contractor to a high
rate, $3,385 per hour, and in other instances they would make con-
tracts witli a favorite contractor for $2.40 an hour? Is that what you
are testifying to?
Mr. Kaye. In some areas, sir, yes, sir.
The Chairman. In some areas?
Mr. Kaye. Yes, sir.
The Chairman. Did the areas have any significance with respect
to the rate? Do they actually pay more in some areas, is the pre-
vailing rate more in some areas than in others?
Mr. Kaye. Yes, sir; they do. But in the five-county area in the
State of Delaware, the contract specifically stated that the rate was
to be $3,385 on that particular machine.
The Chairman. That had been established as an area rate, $3,385
an hour ?
Mr. Kaye. Yes, sir.
The Chairman. That is, in that area ?
Mr. Kaye. Yes, sir.
The Chairman. So the making of a contract for less, with some
favorite employer or some employer would be in violation of the
established rate of that area ?
Mr. Kaye. Yes, sir.
The Chairman. Wliat do you think becomes of this difference be-
tween the $2.40 and the $3,385 an hour ?
Mr. Kaye. What do I think or what do I know ?
I don't know what becomes of it, but I can think of wliat becomes
of it.
The Chairman. Well, I guess we can all have a few thoughts. I was
wondering if you knew or had any information that would actually
substantiate what you think.
Mr. Kaye. No, sir ; I do not.
The Chairman. All right.
Mr. Kennedy. When you went on the job, vou were told it wa.^^ gu-
ing to be at the $3,385 rate ?
Mr. Kaye. Well, I asked the business agent. We were sitting out
in front of the Chrysler plant there in Newark, and he said, "That
is a top-rate job, you know." And I said "Oh? O. K."
Mr. Kennedy. And that was the contract that liad been known to
the members of the union at the time, the $3,385 ?
Mr. Kaye. Yes.
Mr. Kennedy. Had you known at that time there had been other
secret contracts ?
Mr. Kaye. No, sir ; not until I went on the job.
Mr. Kennedy. Were the union officials, when you brought this to
their attention or when you found out yourself, were they reluctant
to tell you about the other contract that had been signed ?
Mr. Kaye. They didn't want to give me the floor. They knew what
I was going to bring up.
Mr. Kennedy. Who was it that was in the chair at the time ?
IMPROPER ACTINITIES IX THE LABOR FIELD 8041
Mr. Kaye. Hank Laveiy.
Mr. Kexnedy. La very?
Mr. Kaye. Yes.
Mr. Kexxedy. He woul < In "t give you the floor ?
Mr. Kaye. I finally got it.
Mr. Kennedy. Did he give you an answer when you asked about it ?
Mr. Kaye. First he denied and then admitted it.
Mr. Kennedy. He denied this existed ?
Mr. Kaye. Yes. And then he finally said, "Well, yes. We did
sign one contract down there like that, with Standard Bithulithic."
Mr. Kennedy. Did he give you any reason for it ?
Mr. Kaye. Not to my knowledge.
Mr. Kennedy. Were you able to get a copy of the contract ?
]Mr. Iv^vYE. I have seen some of the contracts since.
Mr. Kennedy. Have you seen the one they signed with that
■company ?
Mr. Kaye. Standard Bithulithic ?
Mr. Ivennedy. Yes.
Mr. Kaye. No ; I didn't.
Mr. Kennedy. Did he make it available to you at that meeting?
Mr. Kaye. No, sir.
Mr. Ivennedy. All right. The committee will stand in recess until
2 : 30 this afternoon.
(Whereupon, at 12 : 35 p. m. a recess was taken until 2 : 30 p. m.
of the same day, with the following members present : Senators Mc-
Clellan and Ervin.)
AFTERNOON SESSION
Tlie Chairman. The committee will be in order.
(Members of the select committee present at the convening of the
session were Senators McClellan and Ervin.)
The Chairman. Call the next witness.
Mr. Kennedy. Mr. Lavery.
The Chairman. You do solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth and nothing but the truth, so help you God ?
Mr. Lavery. I do.
TESTIMONY OF HARRY W. LAVERY, ACCOMPANIED BY HIS
COUNSEL, JAMES M. McINERNEY
The Chairman. State your name and your place of residence and
your business or occupation.
Mr. Lavery. My name is Harry W. Lavery. I am assistant super-
visor of the Operatmg Engineers Local 542 in Philadelphia. My
residence is 335 Pierce Street in Kingston, Pa.
The Chairman. You have counsel with you ?
Mr. Lavery. Yes, sir.
The Chairman. Comisel, will you identify yourself for the record ?
Mr. McInerney. James M. Mclnerney, American Building, Wash-
ington, D. C.
The Chairman. Thank you, sir.
Mr. Counsel, you may proceed.
8042 IMPROPER ACTIVITIES IN THE LABOR FIELD
' Mr. IvENNEDY. Mr. Laveiy, you have been in tlie Operating En-
gineers Union for how long '?
Mr. Lavert. Approximately 15 years.
Mr. Ejennedy. How long have you been an official of the union?
Mr. LA^^EY. For the past 8 years, approximately.
Mr. KIennedy. Since about 1948 or 1950 ?
Mr. La VERY. April of 1948, sir.
Mr. Kennedy. You were elected as a business agent or appointed
or what?
Mr. Lavery. I was appointed by Mr. Underwood.
Mr. Kennedy. By Mr. Underwood in 1948 or 1950 ?
Mr. Lavery. In 1948, sir.
Mr. Kennedy. And then you were on the executive board also with
Mr. Underwood ?
Mr. LxWERY. That is coiTect, sir.
Mr. Kennedy. And were you appointed to that position or elected
to that position ?
Mr. Lavery. Appointed.
Mr. Kennedy. By Mr. Underwood ?
Mr. Lavery. Yes, sir.
Mr. Kennedy. That was again in 1950 ?
Mr. Lavery. In 1948, sir.
Mr. Kennedy. You are under indictment at the present time ?
Mr. Lavery. Yes, sir.
Mr. Kennedy. You are ?
Mr. Lavery. Yes, sir.
Mr. Kennedy. What are you under indictment for ?
Mr. Lavery. In connection with the Signal Corps Depot alleged
labor racketeering.
Mr. Kennedy. Under the Hobbs Anti-Racketeering Act ?
Mr. Lavery. I believe that is correct, sir.
Mr. Kennedy. At the Tobyhanna project in Pemisylvania ?
Mr. Lavery. That is right.
Mr. I^NNEDY. You were indicted for allegedly receiving money, is
that right, in connection with that?
Mr. Lavery. Yes, sir.
Mr. Kennedy. On two different times.
Mr. Lavery. That is correct.
Mr. Kennedy. Was that while Mr. Underwood was the president
of the local or has that been since that time that you were alleged to
have taken money ?
Mr. Lavery. Since.
Mr. Kennedy. Since that time ?
Mr. Lavery. Yes, sir.
The Chairman. Are these indictments still pending ?
Mr. Lavery. Yes, sir.
The Chairman. I^^ien were they returned against you and how long-
have you been under indictment ?
Mr. Lavery. Well, I believe I went before the grand juiy in April
of 1956.
The Chairman. They have been pending since April of 1956 ?
Mr. Lavery. No, sir ; that is when I went before the Federal grand
jury in Scranton, in April, as I recall it, of 1956. The indictment
came down in February of 1957.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8043
The Chairman. February of 1957 ?
Mr. La VERY. Yes, sir.
The Chairman. The cases have not been disposed of and you have
not been tried ?
Mr. La VERY. No, sir.
Mr. Kennedy. Were you appointed to your position, your position
of assistant supervisor ?
Mr. La VERY. Yes, sir.
Mr. IvENNEDY. By whom ?
Mr. La VERY. By Mr. Hunter P. Wliarton ?
Mr. Kennedy. And he ^yas appointed to his position by William E.
Maloney ; is that right ?
Mr. La very. So far as I know, that is right.
Mr. Kennedy. Has Mr. Maloney or Mr. Wharton taken any steps
to remove you as assistant supervisor since you have been indicted?
Mr. La VERY. Not to my recollection, they haven't.
Mr. Ivennedy. They have not ?
Mr. La VERY. They have not.
Mr. Kennedy. And you still hold that position, although you were
indicted in February of 1957 ; is that right ?
Mr. La VERY. That's right.
Mr. KJENNEDY. Now, we have had testimony before the committee
regarding the activities on your part of not permitting the members of
the local to see or know about the contracts under which they are
working. Are you familiar with that ?
Mr. La VERY. Well, I heard the testimony.
Mr. Kennedy. There was some testimony this morning that there
was a master contract and yet, one of the employees who went out to
work on the contract had to work at $1 less than the master contract
provided for.
You were here during that testimony ?
Mr. Lavery. I was here, sir, and I heard most of it.
Mr. Kennedy. Do you know anything about that ?
Mr. Lavery. Which one are you referring to now ?
Mr. Kennedy. The Bithulithic Co.
Mr. Lavery. Standard Bithulithic ?
Mr. KJENNEDY. Yes.
Mr. Lavery. Yes, I am familiar with that.
Mr. Kennedy. Was a copy of that contract made available to the
members of the union covering the Bitliulithic Co. ?
Mr. Lavery. Yes.
Mr. Kennedy. And did it provide for the wage rate at $2.40 per
hour or $3.38 per hour?
Mr. Lavery. Well, that deserves some explanation, sir. There is
only one way I could explain it.
Mr. Kennedy. Tell me this: The employees who worked on that
job, were they given a copy of the contract before they went to work
on the job ? Did they know the terms under which they were working ?
Mr. Lavery. I couldn't say that they were given a copy of the con-
tract. The contract that you are referring to is a specific highway
contract for outlying areas that we negotiated with the highway
contractors, in northeastern Pennsylvania.
Since the contract covering the area you are referring to a moment
ago was negotiated by a group of building contractors who did no
8044 IMPROPER ACTIVITIES IN THE LABOR FIELD
highway work, we were not in a position to operate under it in the
State of Delaware.
Now, if you will allow me to explain that, I will be glad to do it.
Mr. Kennedy. First, on the question of this, you say, "negotiated a
contract." Were any members of the union on the negotiating com-
mittee? That is, ordinary members of the union, or regular members
of tlie union ?
Mr. La VERT. The particular contract, sir, that you are referring to,
no. The contract that covers the Philadelphia area, yes. There was
a negotiating committee.
Mr. Kennedy. The contract to which I am referring — were the
rank and file on the negotiating committee ?
Mr. La VERY. No, sir.
Mr. Kennedy. They were not.
Mr. La VERY. No.
Mr. Kennedy. Was the negotiating committee elected ^
Mr. La very. There was no negotiating committee elected.
Mr. Kennedy. There was none?
Mr. La VERY. No, sir.
Mr. Kennedy. It was appointed ?
Mr. La VERY. Yes, sir.
Mr. Kennedy. And by whom was it appointed ?
Mr. La VERY. By myself.
Mr. Kennedy. Who was on the negotiating committee ?
Mr. La VERY. There was one Mr. Gaull, an agent, and Mr. Lupinacci,
Mr. Pantallio and myself, and Mr. ^Vliarton.
Mr. Kennedy. Did the rank-and-file members of the union know
that this negotiating committee had been set up to negotiate the con-
tract?
Mr. La VERY. We are talking about a negotiating committee now and
maybe I am off the track here, and I am not quite sure, but the nego-
tiating committee that I am referring to, sir, is the committee that did
the negotiating for the overall contract and not the particular high-
way contract that we have talked about a moment ago.
The Chairman. Let me see if we can get this in proper perspective
so that we can follow it. You have what you call an overall contract,
that is the word you just used.
Mr. La VERY. That is right, sir.
(At this point, Senator Goldwater entered the hearing room.)
The Chairman. What does that embrace?
Mr. La VERY. That contract, we have one contract that embraces the
5 counties of metropolitan Philadelphia and the 4 surrounding coun-
ties.
The Chairman. Is that what you call an area contract (
Mr. La VERY. That is right, sir.
The Chairman. AAHio is it negotiated with?
Mr. Lav^ery. With the building contractors in that area, M'ith the
excavating contractors in that area and the association, witli the
Philadelphia General Contractors Association.
The Chairman. Does that just cover five counties ?
Mr. La\t:ry. That is right.
The Chairman. A five-county area, and vou have an overall con-
tract or an area contract with all of those who use the services of the
IMPROPER ACTIVITIES IN THE LABOR FIELD 8045
Operating Engineers in (hat area, all of the contractors who use or
employ your men in that area.
Mr, Lax'ert. That is right.
The Chairmax. That is the area contract ?
Mr. Lavery. That is right, sir.
The Chairman. What was this Bithulithic Co. contract ?
Wliat w^as that contract made for ?
Mr. La\t2ry. That contract was negotiated between four trades,
the carpentere, teamsters, and laborers.
The Chairman. Does that cover the same five counties?
Mr. Lavery. No, sir.
The Chairman. What did it co^•er ?
Mr. Lai-ery. It covers the '2d outlying counties in northeastern
Pennsylvania for highway work strictly.
The Chairman. It did not cover the five counties that you call the
area contract?
Mr. Lavery. 'No, sir.
The Chairman. They are not included in the 29 ?
Mr. La\-ery. No, sir.
The Chairman. Are they included in this Bithulithic Co. contract?
]Mr. Lavery. No, sir.
The Chairman. All right, now I think that I have the picture. Pro-
ceed.
Mr. Kennedy. Did the areawide contract specifically exclude this
other contract that you have mentioned ?
Mr. Lavery. Yes, sir.
Mr. Kennedy. It excluded them?
Mr. Lavery. That is right, sir.
Mr. Kennedy. ^Yliat was the date of the areawide contract ?
Mr. La\-ery. May 195S.
Mr. Kennedy. What was the date of your other contract, the con-
tract B ?
Mr. Lavery. April 16, 1956.
Mr. Kennedy. April 15, 1956?
Mr. La\t:ry. Yes, sir.
The Chairman. ^Yi^nt was the other date. May 1, 1958?
Mr. Lav'ery. Yes.
The Chairman. It could hardly be that.
Mr. Kennedy. Do you mean 1955 ?
Mr. Lavery. I am sorry.
Mr. Kennedy. Do you mean 1955?
Mr. Lamsry. Will you stai-t over again ? We negotiated a contract
last year, in the metropolitan area of Philadelphia, which went into
effect May 1, 1957, for 2 years, that the rate is renewed May 1, 1958.
That is where I got off.
Mr. Kennedy. We are talking about the contract from 1955 to 1957.
Mr. L WERY. That was April i6, 1956.
Mr. IvENNEDY.Was there a contract, an areawide contract, prior to
that time?
Mr. Lavery, you said you had 2 contracts, 1 was areawide, and what
was the date of that ?
Mr. Lavery. I said, sir, maybe I can clear this up this way.
21243— 58— pt. 20 9
8046 IMPROPER ACTIVITIES IN' THE LABOR FIEIJD
Mr. I^NNEDY. Just tell me what the date of the areawide contract
was.
In answer to the chairman's question you said there was an areawide
contract.
Mr. La VERY. There is a five-county area contract, surrounding
Philadelphia.
Tlie Chairman. What is the date of that contract ?
Mr. La VERY. May 1, 1957, to May 1, 1959.
Now, there is u contract negotiated in the Lehigh Valley with
another group of employers, which is an area contract for that,
covering building and heavy construction. It is the same as the
Philadelphia contract only because of it being in the outlying area,
there is a differential in the rate of 10 cents an hour as opposed to the
Philadelphia rate, for the same type of work.
Mr. ICennedy. What contract covered the Delaware area during
1956?
Mr. Lavery, During 1956 the same practice was followed. There
was a Delaware area contract negotiated with the Allied Constructors
in Wilmington, Del., a group of employers.
Mv. Kennedy. When was that or what was the date of that ?
Mr. Lavery. May 1, 1957.
Mr. Kennedy. Prior to that, the one prior to that ; the one that cov-
ered that time.
Mr. Lavery. May 1, 1955, to May 1, 1957, and it was applicable to
the State of Delaware.
Mr. Kennedy. Now, in addition to that contract, was there a second
contract covering the State of Delaware ?
Mr. Lavery. No ; the way that came about
Mr. Kennedy. This is the situation. We have had testimony from a
witness wlio said that he understood he was working under one con-
tract, and he went on the job and. found out he was getting paid $1 less
an hour than he had understood he was to be paid.
He went back to the union hall, and he spoke to you, and you said that
no such situation existed, that there wasn't a second contract. He said
he pressed you on it and subsequently you admitted that there had
been a second contract.
Now, that is the situation that we have had testimony on, and this
is in the State of Delaware. Now, you have talked about that, that
there was a Delaware contract signed May 1, 1955, and it went through
1957, Now, was there a second contract that would have covered this
company ? Was there a second contract to cover that ?
Mr. Lavery. We made an arrangement with Standard Bithulithic
whereby we asked them to go out and try and get some of the highway
work in the State of Delaware and what we did in that case was to
take the agreement that had been negotiated by the four basic
trades
Mr. Kennedy, Who is "we" ? You and who else?
Mr. Lavery. Well, just "I" then.
Mr. Kennedy. You went to Standard Bithulithic ?
Mr. Lavery. I never went to Standard Bithulithic and I had the
agent in the area go to them and I talked to them on the phone.
Mr. Kennedy. Who was the agent in the area of that company ?
Mr. Lavery. At the time, I believe it was Piscatelli.
Mr. Kennedy. Edward Piscatelli?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8047
Mr. Lavery. I wol^ld have to check that to be certain.
Mr. Kennedy. You had him go to Standard Bithulithic; is that
right?
Mr. Lavery. That is right.
Mr. Kennedy. What arrangements then did you make ?
Mr. Lavery. They were in this position : As t said at the beginning,
the contract that was negotiated was the Allied Constructors in Wil-
mington, a building group, that did no highway construction and
they were satisfied to include the highway section in and with their
agreement although they never did any highway construction.
That was at the Philadelphia rates; it was the Philadelphia area
rates. Now, the situation we had there is this : The State of Delaware
has a municipal wage act in their specifications for highway con-
struction work that stipulates $1.50 an hour is the minimum they must
pay for shovel operators or operating engineers, on highway con-
struction in the State of Delaware.
We were faced wtih this problem : Although we had a beautiful look-
ing document with $3.90 an hour or $3.80 an hour rate for highway
constniction, there has not been a bit of union highway constructed in
the State of Delaware in the past 10 years. Our people were out of
existence due to the fact that the State stipulated $1.50 was all they
had to pay.
In order to try to put our people, we even invited contractors from
Pennsylvania to go down there into Delaware and see if they could
get highway work under this Pennsylvania highway contract, the
same as we did in the 29 counties.
(At this point the following members were present: Senators
McClellan, Ervin, and Gold water.)
Mr. Kennedy. Your testimony, as I understand it, is that you
never had any union contractor doing any work on highways in the
State of Delaware That is your testimony under oath ; is that right ?
Mr. Lavery. JNIy testimony is
Mr. Kennedy. That is, for the past 10 years.
Mr. La\tery. I say 10 years. To the best of my recollection, there
has not been any highways constructed in the State of Delaware.
Mr. Kennedy. By a union contractor ?
Mr. Lavery. By a union contractor, aside from the fact that there
was a bridge job there, and the approaches to that bridge.
Mr. Kennedy. Now, are you changing it? xVre you qualifying it
now? Your w^iole statement on this matter rests with the fact that
there hadn't been any union contractors working on highways in the
State of Delaware. Therefore, you went in and made this special ar-
rangement, as I understand it, with Standard Bithulithic in order to
get them interested in the job. Is it your testimony, under oath, that
there have never been any contractors with union contracts doing any
highway work in the State of Delaware in the past 10 years ?
(Witness conferred with counsel.)
Mr. I^nnedy. I think he knows, Mr. Mclnerney. I think he can
answer it.
Mr. Lavery. I believe I can, too. I said 10 years. Maybe I was
wrong in saying 10 years. I wasn't here 10 years ago. From what I
can leani, to the best of my knowledge, it is a true statement. I came
into this area 5 years ago, in November. To the best of my knowledge,
from that time on, to now, there haven't been any of our union con-
8048 IMPROPER ACTIVITIES IN THE Lu\BOR FIEUD
tractors that done any highway construction in the State of Delaware.
The Chairman. Do you have any exceptions ?
Mr. La VERY. No, sir ; I don't have any exceptions.
The Chairman. All right.
Mr. Kennedy. You made this arrangement through your agent,
Mr. Piscitelli ?
Mr. La VERY. I say I think he was the agent at the time. I would
have to check with him. There have been 3 or 4 agents down there. I
don't want to be pinned down to that. Whether it was Piscitelli or
whether it was Gaull — he was there for a while.
Mr. Kennedy. So, you made this arrangement that they could pay
less than union contract on work they did in the State of Delaware?
Mr. La VERY. On highway work ; yes, sir.
Mr. Kennedy. Do you have authority, under the international con-
stitution, to waive the terms of a contract ?
Mr. La\^ry. We didn't have a contract with any highway people.
Mr. KJENNEDY. You did not ?
Mr. La very. No.
Mr. Kennedy. I have a contract here, dated May 1, 1955, running
between May 1, 1955, to April 30, 1957, covering the State of Delaware,
covering highway work, highway construction, and it gives here the
rate of pay.
Mr. La very. That is right.
Mr. Kennedy. Then did you or did you not have a contract ?
Mr. Lavery. That is the contract I tried to explain, sir, that we
negotiated with a building group of contractors who do know highway
work.
Mr. Kennedy. It says here to cover the highway construction, high-
way work, and it gives the rate of pay.
Mr. Lavery. Regardless of what it says, there is not one of them
that does highway work.
(The witness conferred with counsel.)
Mr. Kennedy. Did this lower rate that you gave Standard Bithu-
lithic only apply to highway construction ?
Mr. Lavery. That is right, sir.
Mr, Kennedy. It didn't apply to heavy jobwork ?
Mr. Lavery. It never was intended to.
Mr. Kennedy. ^Vliat do you mean, it never was intended to? I
am asking you: Did it?
Mr. Lavery. It was strictly a highway arrangement.
Mr. Kennedy. But they did other work. Did this lower rate that
you gave to Standard Bithulithic apply also to other heavy construc-
tion work that they did ?
Mr. LAVEitY. No, sir ; not to my knowledge.
Mr. Kennedy. Well, the testimony or the information that we have
is that it applied to their heavy work as well as their highway work.
Do voii have any pxplanation for that i
Mr. La\tery. No; I don't. I know that Standard Bithulithic, or at
least I understand that Standard Bithulithic, laid all the pavement
on the Delaware City refinery, and they did it at the heavy construc-
tion rate Avhile they were in the confines of that area.
Mr. Kennedy. Mr. Dawson, will you come forward a minute,
})lease ?
IMPROPER ACTR'ITIES IN THE LABOR FIELD 8049
TESTIMONY OF HOMER DAWSON— Resumed
Mr. Kennedy. Mr. Dawson, have you any information regarding
the rates under which Standard Bithnlithic was working during this
period of time?
Mr. Dawson. Yes, sir. It is my understanding that, at the Dover
Airbase, Standard BithuHthic was doing, I think, about a $3 million
project at the time that these concessions were given, and, although
those exact rates did not apply because the Federal Government speci-
fied the minimum-wage rates on the airbase that had to be paid ac-
cording to Government specifications, all of our working conditions
which were waived in the side agreement that was made, those same
working conditions were also waived to Sandard Bithulithic at the
Dover Airbase.
Mr. Kennedy. Were any members of the union informed prior to
the time these conditions were waived? Were any members of the
union informed that there were negotiations taking place between
Mr. Lavery and the company to waive these conditions ?
Mr. Dawson. No, sir.
Mr. Kennedy. They were never informed of that fact ?
Mr. Dawson. No, sir.
Mr. Kennedy. The members of the union were not informed?
Mr. Dawson. There was some discussion that came up on the floor
after the fact, after these lowered working conditions were brought
in at tlie Dover Airbase. The question was also raised as to wliy, and
Mr. Lavery said his answer was to combat District 50, United" Mine
Workers. I have never heard of a mine in the State of Delaware.
Mr. Kennedy. Thank you.
TESTIMONY OE HARRY W. LAVERY— Resumed
Mr. I\[ennedy. Did you ultimately sign a contract with Standard
Bithulithic?
Mr. Lavery. I don't believe there was a contract signed, sir. I be-
lieve it was just an arrangement where we asked them to go in and
see if they couldn't get this work.
Mr. Kennedy. Who's "we," again ? You and the agent?
Mr. La\-ery. That is right.
The Chairman. Surely you know whether there was a contract
signed. If there was or wasn't, you should know. Let us not go
over this if we can help it.
Did you have a written contract with this companv. Standard
Bithulithic?
Mr. Lavery. Senator, I would have to check to see if there is a
contract.
The Chairman. That is just a year or two aao. You would know,
wouldn't you ?
Mr. Lav-ery. I kave no reason to say that there isn't. If there
is
The Chairman. I don't think you should have to.
I am trying to find out. Did you have a written contract or was it
a verhal arrangement ?
You probably should know that. If it is verbal
8050 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. La VERY. I feel quite certain that it was just only an arrange-
ment with them where the contract we had negotiated in Pennsyl-
vania, and those rules and rates, we would try and apply to them
down there to see if they couldn't get some of this work. I actually
don't know if it was ever signed or not.
The Chairman. You don't know, then — that is your testimony
now — whether you had a written contract or just some verbal arrange-
ment ?
Mr. La VERY. I can find out when I get loose of here, but I couldn't
say for sure.
The Chairman. Do you have someone in the room from whom you
can find out ?
Mr. McInerney. Yes.
The Chairman. Have them come forward, please. We will find
out.
You will be sworn.
What is your name ?
Mr. PisciTELLi. Edward J. Piscitelli.
The Chairman. Be sworn, please. You do solemnly swear the
evidence you shall give before this Senate select committee shall be the
truth, the whole truth, and nothing but the truth, so help you God ? ^
Mr. Piscitelli. I do.
TESTIMONY OF EDWARD J. PISCITELLI, ACCOMPANIED BY
JAMES M. McINERNEY, ATTORNEY
The Chairman. State your name, your place of residence, and busi-
ness or occupation.
Mr. Piscitelli. Edward J. Piscitelli, 3520 Lewis Road, New Town
Square, Pa.
The Chairman. We are trying to find out if there was a written
contract or just some verbal arrangements made with the Standard
Bithulithic Co. with respect to that work down in Delaware.
Can you tell us ?
Mr. Piscitelli, Mr. Chairman, I left the area in 1955, in October.
As far as that contract that you mentioned, now, I don't know. I
don't recall it.
The Chairman. All right. Thank you. Step aside. Does any-
body else around here know ?
TESTIMONY OP HARRY W. LA VERY— Resumed
The Chairman. Do you have anyone else who may know ?
Mr. McInerney. Mr. Underwood may know.
Mr. Kennedy. He wasn't allowed to come to any meetings after
1952.
The Chairman. All right. We find that no one knows. The
president or whoever it is — are you the supervisor?
Mr. La VERY. Assistant.
The Chairman. Is the supervisor here?
Mr. Kennedy. Mr. Wharton.
The Chairman. Mr. Wharton, come forward. Let us see if you
know.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8051
Be sworn, please, sir. You do solemnly swear the evidence you
shall give before this Senate select committee shall be the truth, the
whole truth and nothing but the truth, so help you God ?
Mr. Wharton. I do, sir.
TESTIMONY OF HUNTER P. WHARTON, ACCOMPANIED BY
JAMES W. McINERNEY, ATTORNEY
The Chairman. State your name, your place of residence, and busi-
ness or occupation.
Mr. Wharton. Hunter P. Wharton, 4805 Wellington Drive, Chevy
Chase, Md. I am the assistant to the president of the International
Union of Operating Engineers.
The Chairman. In that capacity, what authority or control do you
have over local union 542 ?
Mr. Wharton. In connection with local union 542, 1 am the super-
visor of 542.
The Chairman. That makes you the boss of it, does it not ?
Mr. Wharton. I am the supervisor, yes, sir, in charge of it.
The Chairman. How long have you been there ?
Mr. Wharton. Since August 1952.
The Chairman. Since August 1952. There is a question which has
arisen here in the course of the testimony. We have been unable to
find out from Mr. Lavery, and also from Mr, Edward Piscatelli,
whether the contractor arrangements with the Standard Bithulithic
Co. in the building of roads in the Delaware area was a written con-
tract or just some verbal arrangement. As supervisor or whatever
you are, as head of this union, will you tell us whether you had a
written contract or what happened ?
Mr. Wharton. No, sir; there was not a written contract.
The Chairman. There was no written contract ?
Mr. W^HARTON. That is correct.
The Chairman. Do you have any memorandum of the agreement
whatsoever ?
Mr. Wharton. I can explain the situation to you, sir.
The Chairman. This witness was explaining the situation. What
I want to find out at the moment is : Did you have a written contract ?
Mr. Wharton. No, sir. To niy knowledge, we have not, unless
there is one that has been written — or if there is one that has been
signed by them. There is a form there.
Unless it has been signed with it recently, I don't know of any
written contract with them.
The Chairman. If it has been signed recently, wouldn't you know
it as supervisor ?
Mr. Wharton. Not necessarily, sir.
The Chairman, Well, who would know ? Now we have the type
people in your local,
Mr, Wharton. Sir, I am trying to answer you as truthfully
The Chairman, I am asking for the truth. Who would know it
if you don't?
Mr, Wharton. I would say the office in Philadelphia would know.
The contract forms are standard, and the contractor can sign them
at any time without any special negotiations where there is existing
understandings.
8052 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Well, it gets more confusing. The office would
know but no one here knows, and you are the officers of the office.
Mr. Wharton. I spend the majority of my time here in AVasliing-
ton, and I go up there occasionally to the meetings and look after it
in general. If there is a signed contract with Standard Bithulithic,
or if there isn't, it would not be strange, because the contracts
The Chairman. It wouldn't be strange either way ?
Mr. Wharton. No, sir, it would not.
The Chairman. I am not saying it would be strange, but if there
is a written contract, I want to ask questions about that. If there is
not a written contract, then we have to ask questions about some un-
derstanding or arrangement. The written contract would speak for
itself. You can appreciate if you have a written contract, can you
not?
Mr. Wharton. Sir, I would say to my knowledge I don't know^
whether there is one or not. But the form is, or whether it is written
or not written, would be available.
The Chairman. If it is not written, I don't know how it would be
available.
Mr. Wharton. Wliat I mean is sigTied. Pardon me.
The Chairman. Senator Ervin ?
Senator Ervin. On this kind of highway job, such as was done by
the operating engineers, you have about 35 differnt classifications of
jobs ; do you not ?
They run all the way on the bottom from apprentice engineers and
oilers up to people that handle steel, at the top ?
Mr. Wharton. Yes, sir, there are a number of job classifications.
Senator Ervin. You know very well it would take a man with a most
remarkable memory, more remarkable than anybody on earth ever
possessed, to remember the different wage rates and all the wage rates
of those 35 different classifications.
Mr. Wharton. Sir, there is no need for one to tax his memory to
that degree, because the classifications are available.
Senator Ervin. That is what I thought. If you had nothing but a
verbal contract, which was different from your classification, how
could any human being keep track of any agreement as to the 35
different jobs?
Mr. Wharton. The verbal understanding-, if it was verbal, would
be for them to follow the form contract that did exist.
Senator Ervin. Your assistant supervisor has just testified that
they weren't following the printed form of the contract.
TESTIMONY OF HAREY W. LA VERY— Resumed
Mr. La VERT. We again have the two contracts mixed up here. I
said we were not following the form contract that had been negotiated
with the Allied Building Constructors in Wilmington, Del., but we
did apply and use as a pattern the contract that had been negotiated
with the'highway people in Pennsylvania and applied it to Dela,ware.
Senator Ervn. Absolutely. And then you said you had to modify
it.
Mr. Laverv. We never modified that, sir.
Senator Eratn. You told us a lot, Mr. Lavery. You started talking
about the laws, and about the minimum wage scale in Delaware.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8053
Mr. La VERY. That is right.
Senator Ervin. And you said you had to agree to a different contract
to do road work in Dehiware in order to get the work.
Mr. La VERY. Eight.
Senator ER^^N. And you said that was different from the Philadel-
phia contract ?
Mr. Lavery. I did that.
Senator Ervin. Do you know now whether that difference that you
made, where you modified the Philadelphia contract, was ever reduced
to writing I
Mr. Lavery. We did not modify the Philadelphia contract, Senator.
Senator Ervin. Well, you agreed to work in Delaware, you say, on
a different wage scale.
Mr. Lavery^ That is right. And I tried to explain that the pattern
contract used there, the document used there, was the highway contract
negotiated in the ^9 outlying counties of Pennsylvania, wiiere the
competition was practically the same as in Delaware.
Senator Ervin. That is not the way I understood you to state it
awhile ago. You said you had to modify it not only on account of
that, but you had to modify it on account of the minimum wage law of
Delaware.
Mr. Lavery. In order to put our people in competition.
Senator ER^^N. Well, you mean to tell us now that the minimum-
wage law of Delaware was identical to the wage scales fixed by your
contract covering the 29 Pennsylvania counties ?
Mr. Lavery. Positively not.
Senator Ervin. Then you could not be following it, the wage scale
fixed by the contractor up in the 29 counties, could you, when you
worked in Delaware on the highway ?
Mr. Lavery, We could, and we' did, and we are using it. That is
the contract that they are going by, sir.
Senator Ervin. You are going in Delaware by the contract that
covers the 29 Pennsylvania counties, and notwithstanding that the
wage scales in that contract are different from the minimum w-age law
of Delaware ?
Mr. Lavery. That is right. It w^as so much closer ; $2.80 is so much
closer than $3.90 an hour, or $3.80 an hour, plus 10 cents, and the wel-
fare plan, wliere the minimum wage rate is $1 an hour.
Senator Ervin. But you never had any written agi-eement with
Standard Bithulitliic Co., that you would operate under the contract
that covered the 29 Pennsylvania counties, did you ?
Mr. Lavery. We gave that to them, sir, as the pattern and the work-
ing rules that they would try and get this work under. It is the same
as we did in Pennsylvania.
Senator Ervin. That agreement as far as you remember, was purely
oral, and nothing reduced to writing ?
Mr. Lavery. I can check with our office, and they are all on record
up there. Senator, and it wouldn't take long to check with our office and
see if it has been signed.
Mr. Kennedy. As I understand it, you negotiated a contract which
was signed on May 1, 1955, which was to cover heavy construction,
and highway
Mr. Lavery. Building and highway.
8054 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr, Kennedy. And that was a contract that was signed to cover
from May 1, 1955, to April 30, 1957 ; is that correct?
Mr, La VERY. That is correct,
Mr. Kennedy. Then you went in, in the middle of 1956, or sub-
sequently you signed a contract on April 16, 1956, which was to cover
just a section of what you had already signed a contract for; is that
right ? Just highways and heavy construction ?
Mr. La VERY. For Pennsylvania.
Mr. Kennedy. So you negotiated a contract a year after this good
contract was signed, for approximately $1 less an hour for your peo-
ple. You went down and negotiated, and you had one contract that
would have covered all of the members of the union in highway and
heavy construction, and you went in a year later and negotiated a con-
tract with the contractors which gave your people far less per hour for
the work that they were doing ; is that right ?
Mr. La very. No ; that isn't right.
Mr. Kennedy. Weren't they getting far less under your April 16,
1956, contract than they were under your May 1, 1955, contract ?
Mr. La very. No, sir.
Mr. KJENNEDY. They were not ?
Mr. La VERY. They were getting more because we had no work, and
we did get a little work.
Mr. Kennedy. As the contract is written, they were getting far less
an hour under the April 16, 1956, contract than they were under the
May 1, 1955, contract.
Mr. La VERY. I can't agree with you that they were getting less, be-
cause we had no one working.
Mr. Kennedy. Wait a minute. Less per hour. The standard, the
rates, were less per hour that the contractors signed in 1956 than the
contractors signed in 1955. You don't have to scratch your head on
that one ; that is obvious. The rates per hour were less in 1956 than on
May 1, 1955 ; is that not right ?
Mr. La VERY. I can't agree with it because we had no one working.
Mr. Kennedy. That is not the question.
The Chairman. What the witness is trying to say is that they were
not getting less because they had no work and they were getting
nothing. That is so far as your contract is concerned?
Mr. La VERY. That is positively correct.
The Chairman. All right now, you had a contract for $3 and some-
thing that you had negotiated in 1955 ?
Mr. La VERY. That is correct.
The Chairman. And in 1956 you came along and you said you
weren't getting any work on the highways, and so you made another
contract for about $1 an hour less ?
Mr. La VERY. That is right.
The Chairman. Is that correct ?
Mr. La VERY. That is correct.
The Chairman. The second contract you made, you don't know
whether it was in writing or not ?
Mr. Lavery. It is in writing, Senator, but I don't know if that
particular company signed it. That is the only thing I am troubled
about. It is in writing, and there are books published on it.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8055
Mr. Kennedy. The point is that after you signed this contract,
this April 16, 1956, contract, did you tell the members of the union
that you were negotiating this contract, that would give them a rate
less per hour ? Did you tell the members of the union that ?
Mr. La\-ery. I told them time after time that we were going to
have to go into Delaware.
Mr. Kennedy. We are not talking about Delaware ; we are talking
about Pennsylvania. You haven't gotten into Delaware yet. This
is the contract that you signed for Pennsylvania.
Mr. La VERY. Yes, sir.
Mr. Kennedy. Now, did you tell them you were negotiating a
contract which would get them less, a rate less per hour ?
Mr. Lavery. Yes, sir.
Mr. Kennedy. You did tell them that ?
Mr. Lavery. Yes, sir.
Mr. Kennedy. You were negotiating a contract ?
Mr. Lavery. That is right.
Mr. Kennedy. You told the members of the union, and you an-
nounced in the local you were negotiating with the employers, with
the contractors, that would give them less per hour ?
Mr. Lavery. That is right.
Mr. Kennedy. That is contrary to the testimony that was given
this morning ; you understand that ?
Mr. Lavery. I perfectly understand, sir.
The Chairman. Let me ask you a question. This contract of 1955,
was it ever ratified by the members of your union, was it ever sub-
mitted to them and given an opportunity to vote their approval of it ?
Mr. Laa^ry. It was pointed out to them what advantages there
were.
The CHAiRiiAN. Did they ever vote ?
Mr. Lan-ery. No ; positively no.
. The Chairman. They never had a chance to vote on this one ?
Mr. Lavery. No.
The Chairman. Did they have a chance to vote on the other one
that you modified ?
Mr. Lavery. No.
Mr. Ivennedy. Now, Mr. Lavery, did this contract that you modi-
fied, the modified contract, didn't it also apply to heavy construction
work ?
Mr. Lavery. No, sir.
Mr. Kennedy. It did not ?
Mr. La\'ery. No ; strictly highway.
Mr. Kennedy. When you applied this contract to the Delaware
project, to Bithulithic, did you also apply the modified conditions to
the heavy construction work ?
Mr. Lavery. You are referring to the Dover Airbase project, I
suppose.
Mr. Kennedy. The Bithulithic.
Mr. Lavery. Well, Standard Bithulithic did the paving on the air-
base. That is right.
Mr. KJENNEDY. It applied to heavy construction as well as highway ?
Mr. Lavery.^ The conditions applied to heavy construction on that
particular project.
8056 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. KJENNEDY. Well, now, then your explanation initially was the
reason you did this was because of the highway work ; and what ex-
planation do you have for applying it to heavy construction ?
Mr. La\^ry. Well, here is the explanation, sir : Previous to the time
that we asked the Langef elder Construction Co. and Standard Bithu-
lithic to try and get some of this work in the Dover Airbase, tliere had
been some $7 million worth of it done, constructed, runways laid by
strictly nonunion corporations. We felt that, since the Government
predetermines tlie rate for the job, everyone was bidding alike as far
as wages were concerned, but the cry of the employers, and the rea-
son they wouldn't go in, they Avould go in and bid the job, and they
would bid every contract that came up on that airbase, the union em-
ployers bid it and lost out to them. Therefore, we believed, where
we could relax the conditions and go in and get the job, we were doing
the people a greater service than to have them walking the street out-
side of the Dover Airbase while nonunion people were in there doing
the $7 million.
Mr. Kennedy. Is it provided in the international contract that
somebody in your position can waive terms of contract ? You and Mr.
Wharton verbally waived the conditions of this contract, opening the
whole door to collusion and payoffs and everything else.
Mr. Laa^ry. Well, it can be put that way, sir, but, believe me, it is
not true.
Mr. Kennedy. You have the authority under the international con-
stitution to waive the terms of a written contract, verbally waiving the
terms and conditions in the written contract?
Mr. La VERY. Well
Mr. Kennedy. At your discretion ?
Mr. La VERY. I don't know as I have ever been given the authority
to do it.
Mr. Kennedy. Just answer the question, Mr. Lavery. Under the
constitution, do you have the authority to waive the terms of a
wri tten contract ?
Mr. Lavery. Not to the best of my knowledge, I don't.
Mr. Kennedy. You would know if you had, would you not? Don't
you know there is no part of the constitution that gives you that
authority ?
Mr. Lavery. I am not sure of that. The fact that it has been
done
Mr. IvENNEDY. What is that ?
Mr. LA^^RY. The fact that I liave done it, and I don't know what
bearing that might have on it, with authority or without authority,
it was done in the best interests of the people.
The Chairman. That is one of the problems that we are having
today. There seems to be no sense of responsibility, in some areas,
among union leaders. The fact that you did not have authority doesn't
seem to matter. That has been one of the problems we have been
running into all of the time. There are people in the position of
responsibility and official positions in the unions, who have a trust
responsibility, and they simply take the position that, the constitution
or no constitution, whenever they want to do something they just
do it. Do you see anything wrong in that attitude ?
Mr. Lavery. Not if you see the whole picture clearly. Senator; I
don't see anything wrong with it.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8057
The CiiAiR3iAN. What is wroncr with taking these things to the
union members and letting them vote on it and have a voice in their
art'airs ? What is wrong with that ?
Mr. La\t:ry. Well
The Chairman. What is wrong with what I have asked ?
Mr. La VERY. There is nothing wrong with it.
The Chairman. Thank yon. Proceed.
Mr. IvENNEDY. I expect it is just that type of thing, waiving the
terms of a contract for monetary compensation, that yon are under
indictment at the present time, Mr. Lavery, in connection with the
Tobyhanna matter.
Mr. Lavery. I think that you are very wrong on that.
Mr. Kennedy. You are under indictment under the Hobbs Anti-
racketeering Act, are you not ?
^Ir. Lavery. I am under indictment.
Mr. Kennedy. What does the indictment consist of, if it is not waiv-
ing terms of contracts ?
Mr. Lavery. Certainly, it has nothing to do with waiving terms
of contracts.
Mr. Kennedy. What was it, then ?
Mr. Lavery. For allegedly having taken money.
Mr. Kennedy. For doing what?
Mr. LA^'ERY. That is what we have got to find out in the trial.
Mr. Kennedy. What is the indictment ^ It says that you received
some money from a contractor, and you must have given him some
favor, and not enforced the contract.
Mr. Lavery. Not from a contractor; from a contractor's represent-
ative or superintendent.
Mr. Kennedy. I don't want to get into the whole situation, and
we are not going
Mr. Lavery. I would just as leave not try that, either.
Mr. Kennedy. I just want to find out what you are under indict-
ment for, if it is not for taking money from a contractor.
Mr. Lavery. I have exi)lained, sir, that that is what they allege.
Mr. Kennedy. That is what I say. There were a number of in-
dividuals, Mr. Lavery, who were participating in a beating of Mr.
Ted McCarthy or Mr. McCarty of vour local. Do you know Mr.
McCarty? ' " '
Mr. Lavery. Yes, sir.
Mr. Kennedy. Who paid the legal bills for defending the people
that participated in it and were found guilty of beating Mr. McCarty?
Mr. Lavery. Wliy, so far as T know, the local union paid them.
Mr. Kennedy. How nuich did they consist of? What would l>e
the bill involved ?
Mr. I^AVERY. Oh, I don't know. It may have been in the neighbor-
hood— that is fines you are talking about?
Mr. Kennedy. No; the legal bills.
Mr. Lavery. Gosh, I don't know.
Mr. Kennedy. The lawyers.
Mr. Laa^ry. Just on that particular case, now?
Mr. Kennedy. Yes.
Mr. Lavery. I would have to look it up ; I don't know.
Mr. Kennedy. AYhat about vou, Mr. Wharton ?
8058 IMPROPER ACTIVITIES IN THE LABOfi PlELI>
Mr. Wharton. I couldn't, at this time, give you any figure of what
it was.
Mr. Kennedy. You can't tell us that?
Mr. Wharton. I don't know. It has been some time back, and I
could easily get the figures for you.
Mr. Kennedy. Would you get those figures for us ?
Mr. Wharton. Yes.
Mr. Kennedy. But the union did pay the legal bills for these in-
dividuals, is that right, found guilty of beating Mr. McCarty?
Mr. La VERY. As far as I know, they did.
Mr. Kennedy. And who paid the fines of these individuals?
Mr. La very. I believe that was all taken care of at the same way.
Mr. KJENNEDY. Was that presented to the membership and they voted
on it?
Mr. La very. No, sir.
Mr. Kennedy. Who was that decided by ?
Mr. La VERY. Oh
Mr. Kennedy. '\^nio?
Mr, Laa^ry. I participated in it.
Mr. Kennedy. Mr. Lavery, how about answering some of the ques-
tions ? Who was that decided by ?
Mr. Laa^ry. I didn't follow you, sir.
Mr. Kennedy. Who decided to pay the fines of the individuals who
were found guilty of beating Mr. McCarty ?
Mr. Lai^ery. I believe it was decided or recommended by the
attorneys.
Mr. Ivennedy. What is that ?
Mr. Lavery. I believe the attorneys recommended, and I am not
clear on it.
The Chairman. The attorneys recommended that you pay their
fee ; is that what you said ?
Mr. Lavery. Yes.
The Chairman. Let us have a little order. You mean the attorneys
that represented them, decided you should pay or the union should
pay for it, and you agreed ?
Mr. Lavery. I believe that is the way it was.
The Chairman. You believe that is the way it was ?
Mr. Lavery. Yes, sir.
The Chairman. And you don't know how much the amount involved
was?
Mr. Lavery. I can find that out, and I don't know offhand.
The Chairman. Would you find out, and submit a statement of it,
under oath, as to the amount that was expended by the union, by that
local or the international, whichever it was, or both, for the defense
of the two men and others who were convicted of this assault on Mr.
McCarty, breaking it down in the amount paid the attorneys, and also
the amount paid in fines, and costs ? I want to ask you this :
Did you say the expense was not submitted to the union members?
They had no vote on it, whether you should pay it or not ; did they ?
Mr. Lattery. No, sir.
The Chairman. Do you think that they ought to have a little say-so
about such expenditures ?
Mr. Lavery. Well
IMPROPER ACTIVITIES IN THE LABOR FIELD 8059
The Chairman. It is their money.
Mr. La VERY. That's for sin-e.
The Chairman. Do you think that they should have anything to
say about it, the man who works and pays his dues, that you should
take his money and pay all of your fees and fines and court costs
iind penalties for some man in the union who beats up another member?
Do you tliink that that is right ?
Mr. La VERY. It wasn't the first time that it has ever been done.
The Chairman. Oh, no, I am sure of that. Let us have order. I
am quite certain of that.
I asked you if you thought it w^as right — not whether it w^as done
before, or has been done since. Is that the right way to run a union?
Mv. La VERY. I guess the circumstances would have much to do with
it, sir.
The Chairman. I can't figure any circumstances that deny the men
the right to say how their money shall be spent, particularly in in-
stances like that. If there is ever a circumstance where the men who
work and pay the dues should be consulted, it is under such circum-
stances as attended this matter. Don't you agree with that? If they
are going to have anything at all to say about how^ their dues are
expended, they should have something to say where circumstances
prevail such as attended this situation.
Mr. La VERY. I guess that you are right.
The Chairman. You agree ; do you not ?
INIr. La VERY. I do.
The Chairman. I am hoping you start somo rofor-ius in that local
up there, and see that they do have a chance hereaftei'.
Senator Ervin. You realize that you are not sui)pose<l to expend
union funds except for union purposes, don't you ?
Mr. La VERY. Well, again, the circumstances
Senator Ervin. Circumstances w^on't alter that. Don't you know
that under the law you have no right to expend the funds of the
union except for the purposes of the union — to advance the purposes
of tlie union ?
Mr. La VERY. Well, we will have to see if we can't correct that, sir.
Senator Ervin. You haven't answered my question yet. I said,
Don't you realize that officers of the union have no right to expend
the money of the union except for union purposes ?
Mr. La VERY. Yes, sir.
Senator Ervin. Then when you expend the money of the union
to defray expenses incurred by persons who beat up a member of the
union, it is reasonable to draw the conclusion that the beating up of
tliat person was ordered by the officers of the union; was it not? In
otlier words, one of the activities in which the officers of that union
engaged was that of having people beaten up when they disagreed
with the officers.
INIr. Lav-ery. That is not true.
Senator Ervin. Then, the evidence before us is that this man was
■rather brutally beaten up for attempting to exercise a right of freedom
of speech, in an organization in which he had membership, and in
which he had the right to express his opinion. Then, the men that
beat him up, who club up on him and beat him up, have their expenses
of counsel fees and fines that they were assessed for doing the beating
up paid by the union.
8060 IMPROPER ACTIVITIES IN THE LABOR FIELD
Now, was that a union purpose, the beating up of a member of the
union ? Was that authorized by the union ?
Mr. La VERT. Positively it is not the union's position.
Senator Ervin. Wliy did you take the union money to pay the fines
and the costs for the people that made such a brutal assault on a
man for exercising or attempting to exercise the right of freedom of
speech, which presumably belonged to all American citizens?
I just would like to know why you took the funds of the union to
pay the counsel fees and the fines if these people were not acting with
the consent of the officers of the union who had disposition over that
money when they did commit this assault and battery.
Mr. La VERY. You can rest assured. Senator, that there was no official
of this local union or this international union knew this event was
going to take place.
Senator ER^aN. Well, you can express your approval of such events
by subsequent ratification for prior authorization. When you found
out that the event had taken place, you were so pleased with the event
that you took the union funds to pay the counsel fees and to pay
the fines.
You do not mean to tell me you did not approve of the thing after
it was done, wlien you took that action, do you ?
Mr. Lavery. I certainly did not approve of it at no point.
Senator Ervin. If you did not approve of their conduct, why in
the world did you take union funds to pay the cost of that conduct?
Can you give me any sensible reason ?
Mr. Lavery. I guess I can't give you any sensible reason.
Senator Ervin. That is all.
Mr. Kennedy. Who is your attorney on tlie Tobyhanna matter,
for which you are under indictment ?
Mr. Lavery. John Lanahan.
Mr. Kennedy. Are you paying him ?
Mr. Lavery. Yes ; I am.
Mr. Kennedy. Is the union paying him ?
Mr. Lavery. No, sir.
Mr. Kennedy. The union is not? It has not paid him any money?
Mr. Lavery. Not a nickel.
Mr. Kennedy. You have paid him, liave you ?
Mr. Lavery. I have done that.
Mr. Kennedy. What?
Mr. Lavery. I have done that, sir.
Mr. Kennedy. Have any arrangements been made to return this
local back to the membership so that tliey can huve their right to
vote for their leadership ?
Mr. Lavery. There have been attempts made back in 1955, Febr-
uary, I believe, the 28th, of 1955.
Mr. Kennedy. By whom were these attempts made ?
Mr. Lavery. The general president sent an order out, sent a letter
out to the membersliip, call for an election, and Mr. Underwood and
Mr. Freedman petitioned the court for an injunction to stop the
election. That was the last attempt.
Mr. Kennedy. They tried to stop the election ?
Mr. Lavery. Yes.
Mr. Kennedy. Under what circinnstances was the election going to
take place ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8061
Mr. Lavery. There, was going to be a meeting for nomination of
officers, and an election to follow.
Mr. Kennedy. It was going to be a secret ballot, or was it going
to be under the supervision of the international ?
INIr. La\tery. It was going to be a secret ballot.
Mr. Kennedy. Amongst all the members? Amongst all the mem-
bers of the union ?
Mr. Lavery. All tlie voting members.
Mr. Kennedy. How many voting members are there ? How many
are there in the union ?
IVIr. Lavery. 4,r>0(y.
Mr. Kennedy. And how many vote in the union, when they have
the right to vote ?
Mr. Lavery. 1,250.
Mr. Kennedy. 1,250 can vote out of 4,500 ?
Mr. Lavery. Yes.
]Mr. Kennedy. That is all that are allowed to vote, even when they
have a vote?
Mr. Lavery. That is right.
Mr. Kennedy. That is under the terms of the constitution; is it?
ISIr. Lavery. Yes, sir.
Mr. Kennedy. Only 1,250 members of the local can vote? Only
about 25 percent of the local can vote in an election ?
Mr. Lavery. That is right.
Senator Mundt. What is there about the constitution that stops
tlie rest from voting?
Mr. Lavery. Sir?^
Senator Mundt. What is there about the constitution that prevents
the rest of them from voting?
Mr. LA^^RY. Well, Senator, there is the parent body of the organi-
zation is the voting body. The other branches— the A is the appren-
tice engines, and the B is an organizing branch. After they have
become journeymen mechanics, they can become members of the parent
body, once they are qualified. Then they become voting members.
Senator Mundt. In the meantime, do they pay lower dues than
voting members ?
Mr. La\t:ry. The apprentice dues, at the present time in that local
union, the parent body and the B branch dues are identical.
Senator Mundt. What I am trying to arrive at, if you will straighten
me out in your own words, is this: Do all the people who pay full
dues into the union have the same right to vote ?
]Mr. Lavery. No, sir.
Senator Mundt. Why not?
Mr, Lavery. Because of them being members of a branch local, the
B branch, as it were. It is covered by a section of the constitution.
Senator Mundt. The international constitution?
Mr. Lavery. Yes.
Mr. Kennedy. There is no provision whereby a member from the A
branch or B branch can get automatically into the parent union;
is there ?
Mr. Lavery. Automatically?
Mr. Kennedy. Yes ; after he has served a period of apprenticeship
or a period of time.
21243— 58— pt. 20 10
8062 IMPROPER ACTIVITIES IN THE I^ABOR FIELD
Mr. La VERT. He can, by filling out an experience record, apply to
be transferred into the parent body.
Mr. Kennedy. Who makes the decision as. to whether he gets in or
not?
It is not automatic ; there are no tests that he passes, are there ?
Mr. La VERY. No ; there are no tests.
Mr. Kennedy. He has to get approved by the executive board ?
Mr. La VERY. That is right.
Mr. Kennedy. Otherwise he cannot come into the parent local ?
Mr. La VERY. That is right.
TESTIMONY OF HUNTEK P. WHARTON, ACCOMPANIED BY HIS
COUNSEL, JAMES M. McINERNEY— Eesumed
Mr. Kennedy. Mr. Wharton, you were with the local in Pittsburirh ;
were you not ?
Mr. Wharton. Around over 4,000.
Mr. Kennedy. What local was that?
Mr. Wharton. 66.
Mr. Kennedy. And how many members in that local of over 4,000
were allowed to vote ?
Mr. Wharton. I would say less than 1,000. I don't know the exact
figure.
Mr. Kennedy. Were there not in 1953 about 300 or 350 people that
could vote ?
Mr. Wharton. In 1953, I could not answer you, sir, because I was
not there in 1953.
Mr. Kennedy. Wlien were you there ?
Mr. Wharton. I left there in April 1950.
Mr. Kennedy. How many were allowed to vote when you were
there?
Mr. Wharton. I don't know the exact figure. I couldn't even give
you the exact figure of the total.
Mr. Kennedy. It was less than 350 ?
Mr. Wharton. No, I don't think so. It might have been less than
600, but I wouldn't say it was less than 350.
Mr. Kennedy. Well, approximately 500, we will say, out of 4,000 ;
is that right?
Mr. Wharton. Well, I would say the membership was in the neigh-
borhood of 4,000 at that time, in round figures.
Mr. Kennedy. And the other individuals, some of whom paid dues
equivalent to those that had the full right to vote in elections to choose
their officers?
Mr. Wharton. The constitution provides that they are not per-
mitted to vote on the election of officers.
Mr. Kennedy. "Wliat percentage do you think of tlie international
union, out of the 262,000 or 270,000 members
Mr. Wharton. You are raising it a little high.
Mr. Kennedy. How many ?
.Mr. Wharton. I would say around 240,( 00.
Mr. Kennedy. What percentage of tlio 240,000 members of the
international are allowed to vote in elections for the officers?
Mr. Wharton. I would not attempt to hazard a guess, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8063
Mr, Kennedy. Would you say about 25 percent ?
Mr. Wharton. I would not hazard a guess of any percentage.
Mr. Kennedy. Do you have any figures at the international on
that?
Mr. Wharton. The international office has the records of all of the
membership in the various parent bodies and branches. So they cer-
tainly would be in the international office.
Mr. Kennedy. "Wliat is your job at the international ?
Mr. Wharton. I am assistant to the president.
Mr. Kennedy. You do not have any figures on that ?
Mr. Wharton. I haxe no connection with the secretary's office,
which handles those records. Tlie only time I would have them is if
I would and deliberately ask for some specific figure.
Mr. Kennedy. Considering the unions that are under trusteeship
where nobody has any right to vote, and considering the other locals,
where usually between 25 and 35 percent have a right to vote, it is a
very small percentage of the international that has a right to vote for
their officers, is it not?
Mr. Wharton. I would not hazard a guess as to any percentage
(hat has a right or do not have a right.
Senator Mundt. Maybe you can answer this question :
Has there been any protest on behalf of the men who are under-
going taxation without representation?
Have any of them protested about not having a right to vote ?
Mr. Wharton. Very, very little. There may be an individual now
and again, Senator, but not of any amount.
Senator Mundt. Just listening to the way you explain it, it pre-
sents a very curious situation, of men who pay full dues in an organiza-
tion being denied the right to vote. It would seem to me almost any
red-blooded American, whether he was a Rotarian or a member of
the YMCA or a member of a labor union, would want to have the right
to vote if he is paying the freight.
I am wondering why there would not be a protest on their part.
Mr. Wharton. Well, there hasn't been, and the local unions are
operated strictly in accordance with the provisions of the constitution
in that resr)ect.
Senator Mundt. I think you need a good constitutional convention
in your union.
Yesterday we found out there was no way they could get out from
under a trusteeship, because of the provisions of the constitution.
Now we found out that you suddenly provide a setup where they can-
not even vote.
Do you think that does violence to our democratic concepts ?
Mr. Wharton. Senator, I would answer you by saying that the
constitution speaks for itself in that respect, and if it is read it will
be shown there how they can get out from under supervision if they
are once placed under supervision.
Senator Mundt. Maybe you could tell us. The witness could not
tell us yesterday how you got out. Can you tell us ?
Mr. Wharton. By at least 25 percent petitioning the international
president for relief of supervision, and he will then conduct a referen-
dum vote to see the wishes of the entire membership in that local union.
Senator Mundt. And then the general president may say either
"yes" or "no"?
8064 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Wharton. And if the g;eneral president elects not to, it is an
appealable matter to the general executive board and to the constitu-
tion, the same as any other act of the general president is. It is an
appealable matter, if he denies the request.
Senator Mundt. The general president sits on the executive board,
does he not ?
Mr. Wharton. I don't think that is uncommon, sir.
Senator Mundt. What ^
Mr. Wharton. I say the president of any organization is usually
the nominal head of the board.
Senator Mundt. I am simply pointing out that the appeal goes
back to the group headed by the man who denied the appeal.
Mr. Wharton. There have been appeals that have been sustained
previously throughout the history of the organization.
Senator Mundt. Since Mr. Maloney was presidents'
Mr. Wharton. I would hesitate to say or to S])ecificall3^ bring
them
Senator Mundt. Or specifically since Maloney has been president.
That is the point at issue.
We woidd like to have you insert in the record at this point a list
of the appeals that have been sustained since Mr. Maloney became
president. That will not take up to much room.
Mr. Wharton. So that I might understand you. Senator, do you
mean appeals from his decision or appeals that have gone to the gen-
eral executive board.
Senator Mundt. Appeals from his decision.
Mr. Wharton. I don't know of any that have been made f)n his
decision, and I don't know of too many deciisons that he has made
that would be controversial, that would require ap])eal from his acts.
Senator Mundt. Well, we have complaints about unions under
trusteeships for a couple of decades. That is a long time.
Mr. Wharton. You may have complaints, but have they appealed
in accordance with the constitution and followed its provisions?
Senator Mundt. If they have, 1 would be glad to have you list them
m the record.
Mr. Wharton. I say have they? I don't know of any that have
appealed.
Senator Mindt. You should know more about that than I do.
Mr. Wharton. Well, I should say 1 know of none, sir, in answer
to your question.
Mr. Kennedy. We will be going into that rather heavily when we
get into the Chicago locals, a number of whicli have been under trus-
teeship for 29 years, since 1929, and wliat happened to the leader of
that faction who tried to get the local out from under trusteeship.
Of course, we have had the testimony here for 2 days. Senator, wliere
the individual members have come here and sworn under oath as
to what attempts they have been making to try to get it out from
under trusteeship, and what has happened to them.
Senator Mundt. I was about to observe that when they treat a
fellow who tries to get out of ti'usteeship like you treated McCarty,
aiul then ])ay the attorney fees of the fellows who represent the tltugs
who beat him up, and pay the hues of tlie fellows who got arrested
for beating him, I can understand why not very many of the appeals
ended up as high as Maloney. Can't you ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8065
Mr. Wharton. Senator, on the matter of paying tliose attorney
fees, I think it was something that was established prior to super-
vision in local 542.
Senator Mundt. Did Mr. Underwood authorize those payments?
Did he?
Mr. Wharton, Not those payments, not those particular payments.
But when we went in and assumed supervision of local 542, we
inherited a situation that has cost that local union many, many
thousands of dollars in legal fees and lines and what not.
Senator Mundt. Did they involve the beating up of members by
otlier members ?
JNIr. Wharton. No, sir. It involved, during the strike that led
to supervision, it involved the destruction of equipment. There was
five men who were ari-ested and charged with the destruction of the
equipment.
The local union at that time under Mr. Underwood was defending
these five men. When we went in and took over supervision, we
had continued the defense of those men.
Senator Mundt. That is an altogether different situation.
If a union has called a strike, and if a strike is authorized, and
the men are under orders to advance the interest of the strike, I
can see why a union should assume responsibility, not only for the
acts but for the payment of the destruction of private property.
They are operating then under instructions of a union. That is
quite different from a fellow who gets up at a meeting and tries to
give a speech, exercising the right of free speech. Then he gets hit
in the elevator and you pay the fines of the fellow who hit him down
because he was trying to get the union out of trusteeship. That is
an entirely different situation.
Have you any illustrations of that having happened under Mr.
Underwood ?
Mr. Wharton. I don't know of any situations that would be fights
in or around the meeting that would be comparable; no, sir.
The Chairman. Senator Ervin.
Senator Ervin. Let me see if I understand your testimony. Under
the constitution of the Operating Engineers, and its international
constitution, a local is authorized to place people who pay dues to it
in three classes, class B, class A, alid regular members; is that right?
Mr. Wharton. Yes, sir.
Senator Ervin. Plus permittees.
In other words, you have really four classes, have you not, that pay
dues to the union local ?
Mr. Wharton. You might have five classes, depending upon the
nature of the work which was being organized.
Senator Er\tn. And out of those 5 classes, you only have 1 class
that is allowed to vote at all under the constitution ?
Mr. Wharton. On the election of officers, that is correct.
Senator Er\tn, And even the international president can take away
the right to vote from that crowd any time he wants to, that group,
by placing the local in trusteeship ?
Mr, Wharton. Under the provisions of the constitution; yes, sir.
Senator Ervin, And all this happens in a country where people are
supposed to have some voice in the management of their own affairs.
That is all.
8066 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Just on the appeal to the executive board, what is
the executive board made up of ?
Mr. Wharton. Ten vice presidents, the general president, and the
general secretary-treasurer.
Mr. Kennedy. Do they, as members of the executive board, receive
a salary ?
Mr. Wharton. Yes, sir.
Mr. Kennedy. How is that salary fixed ?
Mr. Wharton. I have no knowledge of how it was fixed, sir. I
just recently became a member of the board, and I have no knowledge
of it.
Mr. Kennedy. Is it not a fact that the salaries of the members of
the executive board are fixed by the president ?
Mr. Wharton. I do not know, sir.
Mr. Kennedy. You do not know that ?
Mr. Wharton. No, sir ; I don't know.
Mr. Kennedy. Well, I will give you this information, then : Maloney
has fixed the salary of the vice presidents at $15,000 a year when they
are assig;ned to areas by him, and the executive board, as you point
out, consists of the vice presidents.
So when the appeal is taken from Mr. Maloney's ruling, it goes to
the executive board which is made up of vice presidents whose salaries
are fixed by INIaloney.
The Chairman. Is there anything further ?
Mr. Kennedy. I want to ask Mr. Freedman, Mr. Chairman, about
a short matter.
The Chairman. Has he been sworn ?
Mr. Kennedy. No, he has not.
The Chairman. You do solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Freedman. Yes, sir.
TESTIMONY OF ABRAHAM FREEDMAN
Mr. Kennedy. Mr. Freedman, you were the attorney for the faction
that has been trying to get out from under trusteeship ?
Mr. Freedman. That is right, sir.
Mr. Kennedy. And you have been devoting your time without
compensation, I understand, except for the trips that you have to take ?
Mr. Freedman. That is right, sir.
Mr. Kennedy. That is just for expenses. Otherwise, you have been
working with no compensation?
Mr. Freedman. That is correct, sir.
Mr. Kennedy. Mr. Freedman, the question came up regarding the
fact that the international wanted to give the local the right to vote
for their officers in 1955. Have you heard that testimony?
Mr. Freedman. Yes, sir.
Mr. Kennedy. And that the local would not accept this ?
Mr. Freedman. That is right.
Mr. Kennedy. Would you tell us what the situation was ?
Mr. Freedman. Well, there were two lawsuits pending : One to can-
cel and supersede this order of Mr. Maloney's invoking supervision,
the other lawsuit was to rescind the order suspending Mr. Underwood.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8067
Both of these lawsuits were in the courts and they were coming up for
trial.
Considering that supervision was on at the time, the general presi-
dent then issued an order that there would be elections. He did not
say anything about lifting supervision. He said there would be elec-
tions. A^liile Mr. Underwood would be ineligible — as a matter of
fact, there were a number of other men who were well qualified, such
as Mr. Dawson, who were among the leaders in the union, who had
been made ineligible by certain manipulations.
Mr. Kennedy. So these people were all ineligible to take part in
the election or run for office ?
Mr. Freedman. Yes, sir.
For example, in Mr. Dawson's case, when he got his dues book,
they withheld stamping it. They kept it in their office for several
weeks and stamped it after the due date so that he would be in-
eligible to run for office. That was one. There were others, too.
Confronted with that situation, we felt that before there could
be an election, if there was an election while the union was under
supervision, we didn't see how it could be a fair one, a democratic
one, nor did we think that it was right to have the election at that
moment when there was a lawsuit pending to determine Mr. Under-
wood's rights, and also the question of supervision.
We therefore filed a petition with the court and laid these things
out for the court, and the court then held that before they hold an
election without terminating supervision, he would issue an injunc-
tion, and that is what he did. As a matter of fact, the court of ap-
peals reissued the same injunction to prevent them from holding an
election while Mr. Underwood is ineligible.
Mr. Kennedy. Certainly your group would be for an election if
they allowed Mr. Underwood and these others to run for office and
the election was supervised ?
Mr. Freedman. At one state in the proceedings, the lower court sug-
gested to them and to us — it suggested that we have an election to
determine whether the membership wanted supervision or whether
they wanted Mr. Underwood.
We immediately said we were entirely willing to leave it to the
membership, but they refused.
Mr. Kennedy. I would like to ask Mr. Acchione a question.
Come forward, Mr. Acchione.
The Chairman. Do you solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God.
Mr. Acchione. I do.
TESTIMONY OF COLUMBO ACCHIONE
Mr. Kennedy. Mr. Acchione, you have been a member of the local
for a number of years ?
Mr. Acchione. Since 1938.
Mr. Kennedy. Were you a delegate at the convention in 1956 ?
Mr. Acchione. Yes, I was.
Mr. Kennedy. At that time, did you attempt to introduce an anti-
racketeering resolution to cover the Operating Engineers ?
Mr. Acchione. Yes, I did.
8068 IMPROPER ACTIVITIES IN THE Ll\BOR FIELD
Mr. Kennedy. What reception did you receive from the officers
of the Operating Engineers when you tried to introduce an anti-
racketeering provision ?
Mr. AccHiONE. They called me Communist. They asked me if 1
was a citizen ; where was I born.
Mr. Kennedy. Who did this to you ?
Mr. Acchione. Mr. Delaney.
Mr. Kennedy. The secretary-treasurer of the international ?
Mr. Acchione. That is right, yes; the secretary-treasurer of the
international now.
Mr. Kennedy. And who else ?
Mr, Acchione. Mr. Thomas, the general counsel. There was also
another fellow, Mr. Coffey, from Buffalo, N. Y. He told me that 1
was the most ignorant, doubletalking person he ever met.
Mr. Kennedy. That was when you were trying to introduce the
antiracketeering resolution in the international convention ?
Mr. Acchione. That is right.
He says that that resolution that I tried to introduce shocked the
signs of decency.
Mr. Kennedy. Was against the signs of decency ?
Mr. Acchione. Shocked the signs of decency.
Mr. Kennedy. Did you persist in trying to introduce the resolution ?
Mr. Acchione. Yes, I did.
Mr. Kennedy. 'V^'liat happened ?
Mr. Acchione. Well, the resolution was never read to the delegates.
The only thing they read to the delegates was what they thought them-
selves, that Acchione — well, all other resolutions they introduced to
the convention.
Mr. Kennedy. But they never read yours ?
Mr. Acchione. They was all read, but theydidn't read mine.
Mr. IvENNEDY. They read other resolutions, but they did not read
yours ?
INIr. Acchione. Thej^ said, "We have a resolution introduced by
Columbo "
Mr. Kennedy. I do not want to go through them all. All the reso-
lutions were read but yours ?
Mr. Acchione. Yes.
Mr. Kennedy. Did you appeal to Maloney to bring your resolution
to the floor ?
Mr, Acchione. Yes.
Mr. Kennedy. What happened ?
Mr. Acchione. He ignored me.
First of all, Delaney booed me. The delegate from Philadelphia,
appointed by Mr. Wharton, he started to boo me. Mr. Delaney ap-
pointed delegates the same way.
I asked Mr. Maloney, "You are the chairman; I can't speak here,
with these goons here hollering the way they do." They finally stopped.
I said, "I request tliat my resolution be read to the delegates," They
paid no attention to it. They never read my resolution to the delegates.
The CiiAiR^FAN. I hand you here a mimeographed copy of it, and I
suppose, or I take it to be the mimeographed copy of the resolution
about which you are testifying.
Do you identify that as such ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8069
Mr. AccHioNE. Yes, sir ; this is the resolution.
The Chairman. It may be made exhibit No. 80.
(Document referred to was marked ''Exhibit No. ISO" for reference
and will be found in the appendix on p. 8309.)
The Cii AIR3I AN. What year was this resolution introduced ?
Mr. AccHioNE. April of 1956, in Chicago.
The Chairman. Are there any further questions of these witnesses ?
]\[r. Kennedy. Senator Mundt brought up the question yesterday
of ]Mr. Underwood, regarding the amount of money. We can call him.
The Chairman. Are there any other questions of these witnesses?
Senator Ervin. I would like to ask Mr. Lavery, how long have you
known of tlie local tliat you are assistant supervisor of ?
Mr. Lavery. What was the question ?
Senator Ervin. How long have you had knowledge of the local union
there of which you are assistant supervisor ?
Mr. Laa^ry. I would say 15 or 20 years.
Senator Ervin. And during that 15 or 20 years, how much of the
time has it been in trusteeship or under supervision ?
Mr. Laatsry. Well, out of 15 years, I would say maybe 10.
Senator Ervin. It has been 10 years under supervision ?
Mr. Lavery. Yes, sir.
Senator Ervin. And all of these people, the local people who are
allowed to vote for officers of our State and local government and
Federal, they were allowed to vote for President of the United States,
and presidential electors, and Senators, and Congressmen and gover-
nors, and all of the other local and State officials, but were denied the
riglit to vote for officers of their local union. That is correct, is it not ?
INIr. Lavery. Well, I would say that again circumstances played a big
part in that, Senator. Going back over the years, there were times there
when the membership was down to a real low ebb, where there might
have been only anywhere from 90 to 100 or 300 or 400 as the program
developed, after the depression. At that time there were not enough
members in the local union to support business agents and officers
and go along as they can with a goodly number.
Senator Ervin. It doesn't take but one man to be sufficient to cast
a ballot, does it ?
Mr, Lavery, Well, what I am saying is that it was to the benefit
of the members of the local union to be under supervision, wdien they
were not able to support themselves.
Senator Ervin. How long have you been assistant supervisor there?
Mr. LA^T.RY. Five years.
Senator Ervin. And how many members has it had on the average
each year since you have been assistant supervisor ?
Mr. La\tery. How many members, you mean ?
Senator Ervin. On the average, yes.
]\Ir. Lavery. I didn't get the question.
Senator Ervin. There have been about 2,000 members now, haven't
there?
Mr. Lavery. We have about 4,500 members.
Senator Ervin. You have about 4,500 members and there are still
too few to vote, is that rifjht ?
Mr. Lavery. That again goes back to the circumstances and these
lawsuits and everything. That local will be back and be an autono-
8070 IMPROPER ACTIVITIES IN THE LABOR FIELD
mous local, I can assure you of that, just as soon as the lawsuits are
■out of the way. It would have been back long ago.
Senator Ervin. The fact is that persons who are deemed capable of
voting for the President of the United States and for the Governor
of Pennsylvania are denied the right to vote for officers in that union,
and have been 10 years out of the last 15. That is true, is it not?
Mr. La VERY. I would say that is true.
The Chairman. Are there any other questions ?
When we speak about this union getting back to be autonomous,
is that what you said?
Mr. La VERY. Yes, sir.
The Chairman. And they will someday ?
Mr. La VERY. I am sure of that.
The Chairman. And it would have except for some lawsuits?
Mr. La VERY. I believe that is true.
The Chairman. One of those lawsuits is to try to get it back, is
it not ? That is why they have a lawsuit ?
Mr. La VERY. That is right.
The Chairman. They have been trying to get it back, and they
!have a lawsuit, and you say if it wasn't for the lawsuit it would get
its autonomy back ?
Mr. La very. I still maintain that.
Mr. Chairman. I do, too, and you can do it anyhow ,can't you?
You can have it back in 30 days' time or less, if Mr. Maloney will
simply issue an order to that effect, is that not true? He has the
authority to do it, and he can do it and it could be back in an autono-
mous status in 30 days' time.
Mr. Lavery. I believe the record shows and Mr. Freedman just
stated it was attempted, and they are the people who blocked it.
The Chairman. But you are paying out lawyers' fees opposing it,
and if anybody gets up on the floor of the local down there and
advocates something like that, you give him the works.
Mr. Lavery. That is exaggerated.
The Chairman. I am not going to argue with you, but let me say
this to you : I don't believe that there is a member of this committee
that would do one thing knowingly to hurt honest, decent unionism
in this country. I have heard and seen in print the remark that this
committee is out to suppress and oppress and to destroy honest, decent
unionism in this country. There is not a word of truth in it. The
people who are doing injury and violence to the cause of unionism are
people like you, who are operating this Operating Engineers Union.
When a little fellow gets up and says, "I don't like the way this is
going and I want to ask some questions about it," you prefer charges
against him for bringing the union into disrepute. But you go out
here and operate a union and are denying the men the right to speak
with reference to their own affairs.
And you take their money, and use it to defend criminals who beat
them up, and you talk about bringing disrepute on unionism. The
disrepute on unionism in this country today is being brought by men
in in high places like you who have a position of responsibility and
trust. You can clean it up.
I am going to ask this committee to follow this union closely. We
are not through yet. I have never had anything so disgustingly clear
IMPROPER ACTIVITIES IN THE LABOR FIELD 8071
of absolute holding men under servitude, and subservient to the will of
dictatoi-s as appears in the administration of the Operating Engineers
Union.
Stand aside please, and let us have the next witness.
Mr. Kennedy. Mr. Underwood.
TESTIMONY OF ROY J. UNDERWOOD— Resumed
Mr. Kennedy. Do you have the figures that went to Mr. Fay, and
to those working under him during the time that he had the adminis-
tration and control over this local ?
Mr. Underwood. Yes, sir, I have.
Mr. Kennedy. Would you read the figures into the record ?
Mr. Underwood. I have prepared an estimate of the receipts.
Mr. Kennedy. It is an estimate ?
Mr. Underwood. Yes, sir. This is estimated total receipts from
assessments, membership dues, and permit fees by Local Unions 542,
542-A, 542-B, and 542-C, or the International Union of Operating
Engineers, AFL, for the 13-year period 1935 to 1948.
I have a breakdown, and if you like, I will give you the total
amount.
Mr. Kennedy. Give us the total amount.
The Chairman. The breakdown can be printed in the record, but
just give us the total. That is a correct breakdown according to your
best information ?
Mr. Underwood. Yes, sir, it is.
The Chairman. The breakdown may be printed in the record at
this point. Give us the grand total.
Mr. Underwood. The total receipts for those items for the 13-year
period is $6,685,000.
(The breakdown is as follows :)
Estimated total recipts from assessments, membership dues, and permit fees
by local unions 542, 542-A, 542-B, and 542-C, International Union of Operating
Engneers-AFL, for the 13-year period 1935-48 :
Average membership 2, 000
Average monthly membership dues $3. 50
Total receipts, membership dues $1, 092, 000
Average working permits 2, 000
Total receipts, working permit fees at $2.50 per week $3, 120, 000
Average iutraunion permits 250
Total receipts, intraunion permit fees $390, 000
Average weekly earnings per member, 1935-37 $50
Total receipts, 5 percent earnings assessment, 1935-37 $960, 000
Average weekly earnings per member, 1937^0 $G0
Total receipts, 3 percent assessment weekly earnings, 1937-40 $1, 123, 000
Total receipts (13-year period) $6,685,000
(Note. — Not included in above estimate are initiation fees, reinstatement
fees, withdrawal card fees, and fines levied against members.)
Mr. I^nnedy. Wliat would be the expenses? Do you have any
approximation of the expenses ?
Mr. Underwood. It is extremely difficult to estimate the expenses,
because they were buying expensive cars, and there were large sums
of money going out.
Mr. Kennedy. Wliat would you say legitimate expenses would have
been ?
8072 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Underwood. I should think $100,000 per year would be ample.
Mr. Kennedy. That leaves about $4 million that disappeared.
Mr. Underwood. Yes, sir.
The Chairman. Are there any other questions ?
Mr. Underwood. May I add just one thing to that? When I testi-
fied yesterday, I estimated that during the period these permit assess-
ments and wliat I termed "kickbacks" were collected, that the average
wage was then — I said about $3,500 a year. The figures were so
staggering when I compiled this, that I thought that they must have
been lower so I compiled it on the basis of $2,600 a year per member,
the average wage, and during the period from 1935 to 1936, and from
1937 to 1940 I compiled it on the basis of $3,100 a year.
So I think it is a conservative estimate.
The Chairman. You took a very conservative basis for making
your calculations.
Mr. Underwood. I think so ; yes, sir.
The Chairman. The committee will be at ease for 2 minutes.
(Thereupon a brief recess was taken.)
The Chairman. Mr. Fay, will you stand and be sworn, please?
You do solemnly swear that the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and noth-
ing but the truth, so help you God ?
Mr. Fat. I do. '
TESTIMONY OF JOSEPH S. FAY, ACCOMPANIED BY HIS COUNSELS,
JOHN A. MATTHEWS, WILLIAM J. EGAN, AND JOHN J. EGAN
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Fay. Joseph S. Fay, Lincoln Avenue, Avon, N. J. I am an
automobile solicitor.
The Chairman. An automobile solicitor ?
Mr. Fay. Or salesman.
Tlie Chairman. You have counsel, have you, Mr. Fay ?
Mr. Fay. I do.
The Chairman. Counsel, will you identify yourself for the record ?
Mr. Matthews. I am John A. Matthews, a practicing lawyer of New
Jersey, with offices at 744 Broad Street in Newark, and I reside at
376 Grove Road, South Orange.
The Chairman. Will you ])roceed. Do you have another attorney ?
Mr. William J. Egan. William J. Egan, 11 Commerce Street, New-
ark, N. J., practicing attorney. I live at 68 Longfellow Avenue,
Newark, N.J.
The CiiAHniAN. Thank you very much.
Mr. John J. Egan. John J. Egan, 11 Commerce Street, Newark,
N. J., of counsel.
Mr. Kennedy. Mr. Fay was convicted a number of years ago, and
he has already served his penalty on that matter, and we are not
bringing him before the committee to rehash that.
However, he has a relationship at the present time with the local,
local 825, and with the Operating Engineers, which makes his testi-
mony of considerable interest to the committee.
IJMPROPER ACTIVITIES IN THE LABOR FIELD 8073
It is for that reason that he is being called, and I would want to
first explore his background, the relationship that he has with the
local in Philadelphia, and then get into his present relationship with
825 and the International Union of Operating Engineers, and what-
ever financial transactions he has had with that union.
You were with the Operating Engineers, Mr. Fay ?
Mr. Fay. Yes, I was.
Mr. Kennedy. When did you first join them ?
Mr. Fay. In 1909.
Mr. Kennedy. In what local at that time ?
Mr. Fay. That was the steamshovel and Dragmen's International
Union, of the xVmerican Federation of Labor.
Mr. Kennedy. Was that part of the Operating Engineers at that
time ?
Mr. Fay. Not at that time.
Mr. Kennedy. Did it become part of the Operating Engineers ?
Mr. Fay. Yes, sir ; it did.
Mr. Kennedy. What local would that have been?
Mr. Fay. I first joined local 106 of Albany, N. Y., in 1915, and
transferred into local 825 of Newark, N. J., in 1918.
Mr. Kennedy. Were you an official in local 825 at that time, when
you transferred ?
Mr. Fay. No, sir.
Mr. Kennedy. Did you become an official shortly afterward?
Mr. Fay. No, sir.
^Ir. Kennedy. When did you first become an official of the Operat-
ing Engineers ?
JNIr. Fay. Well, sir, I don't believe that the position that I held
with local 825 was ever classified as an official. I was the business
agent and that office was not declared as one of the line offices of a
local union.
jMr. Kennedy. Were you appointed business agent?
Mr. Fay. No ; I was elected.
Mr. Kennedy. When wei'e you first elected then ?
Mr. Fay. In 1919.
Mr. Kennedy. What was the membership of 825 at that time?
Mr. Fay. I believe, to the best of my recollection, it was about 139
or 140 members.
Mr. Kennedy. Who was the head of the local ? Who was president
of the local ?
Mr. Fay. Edward Shinn was president of that local.
Mr. Kennedy. Edward Shinn, S-h-i-n-n?
Mr. Fay. Yes, sir.
Mr. Kennedy. Did he remain president until he died?
Mr. Fay. He did, sir.
Mr. Kennedy. And that was how long ago? A couple of years?
JMr. Fay. No ; it was 6 years ago, in March.
Mr. Kennedy. About 1952?
Mr. Fay. Yes, sir.
Mr. Kennedy. He died in 1952 and he was president from 1919 to
1952 ?
Mr. Fay. He was.
Mr. Kennedy. And did you hold any other position with that local,
■other than business agent?
8074 IMPROPER ACTIVmES m THE LABOR FIELD
Mr. Fay. No ; I did not.
Mr. Kennedy. And you were business agent up to what time?
Mr. Fay. Up until I went away, in 1947.
Mr. Kennedy. In 1947?
Mr. Fay. Yes, sir.
Mr. Kennedy. Did you have any other official position with the
international union other than business agent of local 825?
Mr. Fay. Yes, sir. I was sixth vice president of the international
union, elected in 1940.
Mr. Kennedy. You were elected sixth vice president in 1940 ?
Mr. Fay. Yes, sir.
Mr. Kennedy. Who was the international president at that time?
Mr. Fay. John Purcell.
Mr. Kennedy. And did Mr. William E. Maloney take over a short
time after that from Mr. Purcell ?
Mr. Fay. In 1940, in September, Mr. Maloney, at the death of Mr.
Purcell, William E. Maloney became international president.
Mr. Kennedy. Was he elected international president at that time?
Mr. Fay. No ; he was appointed by the executive board.
Mr. Kennedy. Which was made up of the vice presidents?
Mr. Fay, Yes, sir.
Mr. Kennedy. And you were one of those vice presidents ?
Mr. Fay, I was.
Mr. Kennedy. Now, did you have any other position with the in-
ternational other than a business agent of the local, and other than
the position that you were elected to in 1940 as a vice president? I
am thinking now of the eastern representative.
Mr. Fay. Eastern district representative, and that was a servant to
the pleasure of the international president.
Mr. Kennedy. Who appointed you to that position ?
Mr. Fay. First Mr. Purcell, John Purcell.
Mr. Kennedy. Who was the international president?
Mr. Fay. Yes, sir.
Mr. Kennedy. Wlien were you appointed eastern representative?
Mr. Fay. I believe I was appointed eastern district representative
in 1932 or 1933.
Mr. Kennedy. And in that capacity did you have control over the
local in Philadelphia which was then under trusteeship?
Mr. Fay. Only subject to the orders of the general president.
Mr. Kennedy. ^Vllat was your position in connection with that
local in Philadelphia ?
Mr. Fay. The international president ordered me to go in and in-
vestigate the situation and make a report to him.
Mr. Kennedy. What year was that ?
Mr. Fay. I certainly don't want to be held to this because I cannot
get these records that are available.
Mr. Kennedy. About what year ?
Mr. Fay. About 1934 or 1935, I would judge. I think it was 1935.
Mr. John Egan. Mr. Chairman, excuse me, Mr. Kennedy.
It would seem now that the press photographers have had enough
time to take pictures, and we feel it is distracting to the witness, and
we would request through the Chair that the pictures stop so that
Mr. Fay can give his full attention to the questions.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8075
The Chairman. Gentlemen, there will be no more flash pictures.
That request is granted.
Proceed.
Mr. John Egan. It seems to me that all of them are distracting^
and Mr. Fay informs me that they are distracting, and so for that
reason I request all pictures to be stopped during this questioning.
The Chairman. The witness is cooperating with the committee, and
I see no reason why the request should not be granted.
All right, the request is granted, and no pictures will be taken, and
turn out some of these lights. Do you mean these lights here ?
Mr. John Egan. I mean these, and those lights particularly, sir.
The Chairman. As long as the witness cooperates with the com-
mittee, we try to cooperate with the witness.
The request is made in good faith. All right, proceed.
Mr. Kennedy. You went down to make an investigation in 1934,
approximately ?
Mr. Fay. In 1934 or 1935.
Mr. Kennedy. And you were asked to go down and make that in-
vestigation by the international president ?
Mr. Fay. President Purcell, yes, sir.
Mr. Kennedy. Did you have any position with that local after that
period of time, after 1934 ?
Mr. Fay. Some time after that I was apjDointed by President Purcell
as the supervisor of local 542, and was ordered by President Purcell,
as I remember it, to appoint an assistant supervisor, because I had
told him that I didn't have the time to take care of any supervisor's
job.
Mr. Kennedy, "\^'^lo did you appoint at that time ?
Mr. Fay. I first went to the scene where the local union was under
supervision, and there was a man by the name of Mr. Haury, as
supervisor there. He was someplace else, and I called together
a group of old-time members and I went over the entire matter. As
I saw the great trouble was that there was no work and there was a
terrible lot of misunderstanding. So there was a man that had be-
longed to that local union for a number of years who had been elected
a business agent of that local union during the 1920's.
Mr. Kennedy. When was the union put in trusteeship?
Mr. Fay. I wouldn't know that, sir Prior to 1935, it was.
Mr. Kennedy. For how long had it been under trusteeship when
you got down there?
Mr. Fay. I wouldn't know that, sir. I don't have the records, but
it was prior to 1935.
Mr. KENNrj)Y. Had it ever been out from under trusteeship?
Mr. Fay. I knew nothing much about the local union, until I went
in there at this time in 1935.
Mr. Kennedy, I understood you to say you went down to make an
investigation of the situation down there.
Mr. Fay. Yes, sir.
Mr. Kennedy. You did not find out how long the union was in
trusteeship ?
Mr. Fay. I found out it was under supervision by an application of
the membership of local 542 that had been made to the international.
Mr. Kennedy. When was that?
8076 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Fay. I judge prior to 1935, but 1 don't knoAV the exact year,
but it is on the records, sir,
Mr. Kennedy. We are having difficulty finding it out. Was it in the
1920's, and it had been under trusteeship for 5 or 10 yeai-s or what?
Do 3'ou remember that ?
Mr. Fay. I \YOuld think it was during the depression, and so it must
have been from 1930 to 1931 or something like that. I think that Mr.
Haury, the previous supervisor of that local union, had been in there
2 or 3 years.
Mr. Kennedy. Well, continue about your selection of the nian to
run the union, under you, as an assistant supervisor. Whom did you
finally select?
Mr, Fay. John White, who had been a business agent of that local
union previously, and he was accepted and suggested by the 14 or
16 men who I met in Philadelphia.
Mr. Kennedy. Is he also known as Jasper White?
Mr. Fay. Yes; he is.
I submitted it to them, and they accepted it, and we called a meeting
of as many men as was in good standing, and they accepted it.
Their gieat problem at that time was that they had no money, and
I requested of the general president of the international to help them,
and I believe tlie records Avill disclose that either $50 or $100 a week
was given to them over the period that they were under supervision,
(At this point, the following members were present: Senators Mc-
Clellan, Ervin, Goldwater, and Mundt.)
Mr, Kennedy, What were the dues at that time ?
Mr. Fay. I would say the dues was $4, $4, or $5.
Mr. Kennedy, Jasper "Wliite was working under you ; is that right ?
Mr, Fay, Yes, sir,
Mr, Kennedy, How often did you come down to the meetings of the
local?
Mr, Fay. To the best of my recollection, in the years that I was over
there, I was there on 5 occasions,
Mr, Kennedy. On five occasions ?
Mr. Fay, Yes, sir,
Mr. Kennedy. During the time you were supervisor, you were only
there five times ?
Mr. Fay, That is all I can remember.
Senator Mundt, Over a period of how many years would that be ?
Mr, Fay. That would be from 1935 to 1941 or 1942,
Senator Mundt, On the average of about once a year ?
Mr. Fay. Well, once or twice a year. Toward the last end I
wasn't there very much. They got running faii'ly well as I saw it, and
this man White knew the territory better than I did. My great prob-
lem and interest to come there w^as that the local union that I was
business agent of represented the territory of Camden and the border-
line of Philadelphia Local 542 territory, I knew, I found out, that
the wages of the engineers on the Camden side was $2 an hour and the
wages of the engineers on the Philadelphia side was $1, and badly
needed to be organized. That was the interest of not only myself but
the local union that I represented. We had a lot of confusion over
the option condition. I went in there, and in my opinion White knew
the territory, and he was accepted not only by these 14 or 16 men
IMPROPER ACTIVITIES IN THE LABOR FIELD 8077
whom I brought into the first conference that was known as the execu-
tive board, but I called a special meeting and we held that meeting.
I should judge, not exaggerating, there was 150 members or 200
members at that meeting. They accepted the setup, and they ap-
pointed an executive board and the officers. I told them veiy frankly
that my aim and object was to as quickly as possible take them out
from uiider supervision because I never approved of supervision, only
for emergency cases, at all times.
The local union went along and built up their agreements. The
last agreement that I remember going over I saw that they had raised
the wages more than 100 percent. I also want you gentlemen to know
that one of the first times that I visited Philadelphia, I asked them to
call a meeting with the general contractors for the purpose of letting
them know that this local union, as far as I was concerned, had local
autonomy to negotiate all their own agreements. My interest was that
in those agreements they must carry the craft jurisdiction, the ma-
chines that we covered in accordance with the interaational and in
accordance with our rights from the American Federation of Labor.
That was my concern.
Gentlemen, I want you to know that that was my last meeting that
I attended to any negotiating or any dealing with the contractors'
association.
Mr. Kennedy. Did you submit the contracts you negotiated to the
membership ?
Mr. Fat. I am just telling you, Mr. Kennedy, that I never nego-
tiated a contract. The assistant supervisor. White, and his committee
from the local union, submitted them to the local union as far as I
know.
Mr. Kennedy. You were supervisor. Was that done? You were
the one that had the responsibility. You were the one that went down
there in 1935 to hnd out how the local was being operated and how
it was being run. You say you were in favor of democratic processes
and procedures.
Mr. Fay. I was, sir.
Mr. Kennedy. You wanted the individual members to take an ac-
tive role in their union. Did you see to it that the contracts that were
negotiated that covered these members of the union — did you see that
these contracts were submitted to the membership ?
Mr. Fay. That was done, as far as I know, by White, and before
that contract can be valid it must be submitted to the international
president.
Mr. Kennedy. I am not asking about that, Mr. Fay, whether it
was submitted to the international president. I am asking whether
those contracts were submitted to tlie members of the local. We have
had testimony before this committee that this union was run by you
in a completely dictatorial fashion, that you never kept the members
informed at all.
Now you are having the opportunity to answer that hei-e nov:. One
of the points that was made before tins committee was that yo;; never
submitted the contracts to the members of the local.
Mr. Fay. In 1935, 1936, 1937?
2124;;— 58— pt. 20-
8078 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. All the time that you had anything to do with this
local, that none of the contracts were ever submitted to the member-
ship.
Mr. Fay. I happened to be at one of the meetings, one of the special
called meetings, where one of the contracts was read in its entirety
and accepted.
Mr. Kennedy. When was that ?
Mr. Fay. I would say that that was in 1937 or 1938.
Mr. Ivennedy. Do you kno^v of any other time at which a contract
was submitted to the membership ?
Let me ask you first : What did that contract cover ?
Mr. Fay. It covered the craft jurisdiction and wages and condi-
tions for the engineers, firemen, oilers, and mechanics.
Mr. Kennedy. In what area ?
Mr. Fay. In the area of Philadelphia. Local 542 covered 33 coun-
ties in the State of Pennsylvania, and some part of Delaware.
Mr. Kennedy. Did this contract that you say was submitted to the
membership cover all this area, the 33 counties ?
Or did it just cover the city of Philadelphia? I am trying to find
out whether it was just a special contract or whether it was a contract
that covered everywhere.
Mr. Fay. I believe that the contract was an overall basic contract
to cover all jurisdictions. The two contracts, the road-building con-
tract and the building-trades contract, I believe, was into one, and they
read the complete document.
Mr. Kennedy. Do you know of any other occasion on which the
contract was submitted to the local ?
Mr. Fay. I don't know. I was not at any meeting. On these con-
tracts, I was ordered by the international president — and being just
a servant of his — that before any contracts would be valid, they would
have to be O. K.'d first by the international president. That was not
my authority.
Mr. Kennedy. What wasn't your authority ?
Mr. Fay. My authority was not to inspect the contracts. The com-
munications between the assistant supervisor. White, and Purcell,
that was done between tliose two.
Mr. Kennedy. But you had the position of supervisor. You were
the one that had the authority over the local. Certainly you had the
say as to whether the membei'ship would be kept informed as to the
contracts. But the only one that you know of, or the only one that
you can testify to was this one occasion in 1937 ?
Mr. Fay. Yes, sir. But I can testify that Mr. Purcell, the general
president at the time, told me tliat the drawing up of contracts would
have to be submitted to him and not to me.
Mr. Kennedy. I understand
Mr. Fay. Tlie power was taken away from me.
Mr. Kennedy. I understand that he had to see them. I am talking
about the fact that you had the responsibility foi- the local, you had
the responsibility to the members of the local. You started this off
by saying that you wanted to make sure that the local members were
informed as to what was going on. I am just asking you as the person
that had this authority and responsibility during this period of time,
during 1935 up to early 1940, whether you took any steps to see that
IMPROPER ACTIVITIES IN THE LABOR FIELD 8079
the membership was kept informed of tlie contracts. Let me go to
another question : Did you take any steps to see that the membership
was kept informed as to the finances ? Were there books and records
of the local open to the membership ''(
Mr. Fay, The record ^Yill disclose that on one or two occasions I
recommended that a certified public accountant would go in and make
an audit of the books.
jNIr, Kexnedy. That didn't answer the question.
Mr. Fay. And that was done. As far as going into that office and
going over the ledgers or anything, I certainly did not.
Mr. Kennedy. I am asking you whether yon took any steps to see
that the membership were kept informed of any of their finances.
Mr. Fay. I feel that in a local union, on the meetings — understand
me, this local union had a meeting every month, the regular meeting,
and the executive board met. That was functions, and if there were
complaints, they should have seen taken up at the meeting. I didn't
get no complaint along those lines.
Mr. Kennedy. If you were the supervisor, you w^ere the one in charge
of the local. Just answer the question : Do you know of any occasion
where the financial books and records of this local were made available
to the membership ?
Mr. Fay. Personally, myself, I don't know.
Mr, Kennedy. We have also had testimony regarding a 5 percent
assessment that was made on the members of the union. Would you
explain to the committee about the 5 percent assessment ?
Mr. Fay. I knew nothing about that. It wasn't taken up with me.
It was taken up at the regular meeting, a si^ecial called meeting, and
they voted that assessment on them. That assessment, as I understood,
and I had an audit made of the moneys that was taken in, was because
of the local's condition, financially. They placed this assessment of
5 percent on the working members. That money would be used to help
the nonworking members to keep their dues in good standing so that
they wouldn't lose their death benefit or their strike benefits. During
the depression, understand, is when this was. That is exactly what it
was used for. According to the audit that the certified public account-
ant made and sent to the general president, Purcell, the money was
intact and not misused. Not misappropriated.
JNIr. Kennedy. Were the books and records dealing with the funds
of the special assessment made available to the membership ?
Mr. Fay. The books and records of the
Mr. Kennedy. Of the special assessment.
Mr. Fay. To every individual member?
Mr. Kennedy. Yes; to the members of the local who were paying
in their money.
Mr. Fay. If they went up and made a request that they wanted to
see their standing or anything
Mr. Kennedy, I am asking about whether the membership was
kept informed as to how much money came in and how that money
was used, who was receiving the money ? Was the membership kept
informed of that w'hile you were the supervisor?
Mr, Fay. I knew the membersjiip was kept informed of the audit
that was made.
8080 IMPROPER ACTIVITIES IN THE Lu\BOR FIELD
Mr. Kennedy. The audit doesn't do any good, as you know, the
fact that so much money was received and so much money went out,
and somebody added up the figures correctly. That doesn't prove any-
thing.
Mv. Fay. JMr. Kennedy, the way they do that in any local union in
our international is if you have a gripe, complaint, you go in and you
ask for it. If that was ever asked for and denied a member, I don't
know. But I was never asked.
Mr. Kennedy. Did you ever see that those books and records were
made available to the membership regarding this assessment?
Mr. Fay. There was the president, and officers, and everybody. No,
sir ; I didn't see that them books
Mr. Kennedy. According to the estimate of Mr. Underwood, there
was some $960,000 that was taken in under this 5 percent assessment,
$960,000 ; can you tell us where the money went?
Mr. Fay. Wlien did this gentleman come in the union?
Mv. Kennedy. This is from 1935 to 1937.
Mr. Fay. I don't believe there was any assessment then.
Mr. Kennedy. There was a 3 percent assessment from 1937 to 1940,
totaling $1,123,000, making a total of just a little over $2 million
altogether.
Mr. Fay. When was that record?
Mr. Kennedy. This was the assessment that was in existence after
you took over as the supervisor.
Mr. Fay. What year, Mr. Kennedy ?
Mr. KE^"NEDY. It lasted from 1935 to 1937, the 5 percent assessment,
and then the 3 percent assessment from 1937 to 1940.
Mr. Fay. I don't believe the records will disclose that there was any
assessment on in 1935.
]Mr. Kennedy. According to the information and the testimony
before the committee, there are no records at all available, so we cannot
consult any records.
Mr. Fay. As I remember it, the assessment went on some time in
1936 or maybe 1937. But the records certainly must be
Mr. Kennedy. According to the testimony before the committee,
Mr. Fay, and one of the reasons that you are here, the local members
were never told or allowed to learn how this money was being used,
how much money was being collected, and what wmis done with the
money. All they know is when they took over in 1948 and got con-
trol of their own affairs, there wasn't any money left. You were the
supervisor during the majority of the period of time.
Mr. Fay. When wasn't there any money left?
Mr. Kennedy. There was $60,000, I believe, in 1948.
Mr. Fay. In 1948 ? I was around there in 1942. I had nothing to
do witli it
Mr. Kennedy. You had a lot to do with it for at least a 7- or 8-year
period. Included in that period was this $2 million that was esti-
mated that was collected by the local union.
Mr. Fay. Mr. Kennedy, may I ask who testified to that?
Mr. Kennedy. Mr. ITJiderwood.
Mr. Fay. When was Mr. Underwood a member of local 542? I
never knew him in my time.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8081
TESTIMONY OF ROY J. XJNDERWOOD— Resumed
Mr. Kennedy. Mr. Unde^^Yood, would you tell him the basis of
these figures, of 5 percent and 3 percent ?
Mr. Underwood. Yes, sir. I first joined local 506-B m 1935 and
was told at that time there was a 5 percent assessment on that I would
be required to pay on any work I did.
However, I left immediately, paid 3 months' dues and left im-
mediately to take a job on the w^est coast. .
When I returned in 1937—1 did no work in that area during that
period— when I returned and joined local 542 in 1937, the 3-percent
assessment was then in effect and the members had told me, many
members that I worked with, that they had been paying since 1935 the
5 percent assessment.
Mr. Kennedy. How long did the 3 percent assessment remain ?
Mr. Underwood. That continued until about the middle of 1940.
Mr. Kennedy. The 3 percent assessment totaled $1,123,000 accord-
ing to your figures ?
Mr. Underwood. Yes, sir.
Mr. Kennedy. And the 5 percent assessment for the short period
you had personal knowledge of, amounted to $960,000 ?
Mr. Underwood. That is my estimate.
Mr. Fay. I don't believe the gentleman was in the local during the
years that I speak of.
Mr. Kknnedy. I believe he was.
Mr. Fay. 506-A? I never heard of that.
Mr. Underwood. 506-B. The charter was issued, I believe, in 1936,
for 542, local 542.
Mr. Fay. He just said he was on the west coast for 3 years.
]Mr. Kennedy. Would you explain the connection between your
local and the local of which Mr. Fay was administrator?
jMr. Underwood. I was a member of local 542 in 1937, and Mr. Fay
at that time was the supervisor.
Mr. Fay. The record discloses that you joined in 1938 ?
Mr. Underwood. He was supervisor up until the time he was re-
lieved by Mr. John McDonald, appointed in 1947 by Mr. Maloney.
TESTIMONY OF JOSEPH FAY— Resumed
Mr. Fay. Mr. Kennedy, I am sure I could show you records, your
committee investigators, that that is not the truth.
Mr. I^NNEDY. You have records of the local ?
Mr. Fay. I have records of the correspondence.
Mr. Kennedy, Do you have records of the local ?
Mr. Fay. No; of the correspondence between me as the supervisor
and the international president. They will disclose these facts.
Mr. Kennedy. What will they disclose, this correspondence?
Mr. Fay. Wlien these meetings was called.
Mr. Kennedy. What will it disclose about Mr. Underwood?
Mr. Fay. When the 5 percent went on by the vote of the local.
Mr. Kennedy. You said you had records about INIr. Underwood,
showing when he joined the local. What records do you have ?
Mr. Fay. I never saw Mr. Underwood in the local at any time
during my time.
8082 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. You said you had records that would show when
Mr. Underwood joined the local. Wliat records do you have?
Mr. Fay. The international would have the records of when he
joined.
Mr. Kennedy. Wliat records have you got ?
Mr. Fay. The international has the records.
Mr. Kennedy. Have you seen the records?
Mr. Fay. No; I didn't.
Mr. IvENNEDY. How would you know that the records would show
he joined in 1948?
Mr. Fay. I believe it is available to this committee, the records from
the international headquarters.
Mr. Kennedy. What records have you seen ?
Mr. Fay. Do you know, Mr. Kennedy, that I was preexamined
with reference to this Philadelphia case, and unbeknown to me Mr.
Underwood was present at that examination.
Mr. Kennedy. Could you just answer the question ?
Mr. Fay. What?
Mr. Kennedy. Could you just answer the question : ^Miat records
are you referring to that are available ?
Mr. Fay. The records of the international.
Mr. Kennedy. That is what you were referring to ?
Mr. Fay. Yes, sir.
Mr. Kennedy. Have you seen those records yourself ?
Mr. Fay. No, sir.
Mr. Kennedy, Did you know that the records will show that he
joined ?
Mr. Fay. I believe it was in the paper and in this case in Phila-
delphia.
Mr. Kennedy. That he joined?
Mr. Fay. My lawyer, Mr. Matthews, has a copy of it. I think it
is no more than fair to me, being interrogated on this matter, which
was so many years ago, more than 25 years ago, that he read the deci-
sion, so that it will clear up those years that you are trying to get me
to testify on.
Mr. Kennedy. I don't know to what you are referring. Could I
see it ?
Mr. Fay. Mr. Matthews has the copy.
Mr. Matthews. Mr. Chairman, gentlemen of the committee, Mr.
Kenndy, I have the opinion ; it is a very long one, but I don't want
to read it or take your time with it.
The Chairman. What opinion do you refer to, Mr, Counsel — the
opinion in some case ?
Mr. Matthews. Yes, sir. I am referring to the case heard in the
Federal district court, United States Federal District Court for the
Eastern District of Pennsylvania, the decision of which came down,
sir, on the 23d day of May 1957.
Underwood was plaintiff in one case against Maloney, and Dawson
was plaintiff in another case against Maloney and ^Vharton.
Mr, Kennedy. If we get into this, and you open the door on this,
we will have to go through the whole thing.
Mr. Matthews. Mr. Kennedy, I am perfectly willing, after wait-
ing 2 weeks, to go in any door, to show you that Mr. Fay has not been
IMPROPER ACTIVITIES IN THE LABOR FIELD 8083
connected in the manner that Underwood connected him, according
to the press. I will just, if you give me permission, quote one sentence
now.
Mr. Kennedy. I would like to read it first, please.
Mr. Matthews. Yes, sir.
Mr. Kennicdy. You didn't mean that Mr. Underwood was present
when any of us, or any of the investigators, interviewed you ?
Mr. Fay. No, sir.
(Document handed to committee.)
Mr. Matthews. I understand, Mr. Chairman, Mr. Kennedy says I
may read this sentence from this report.
Mr. Kennedy. I suspect you are going to take the whole paragraph,
not just the sentence.
Air. Matthews. No; just a sentence. I don't want to read the
report.
The Chairman. Wait a moment. Bring it back and let me see it
again.
( Document handed to committee. )
The Chairman. If you care to, this whole document, which I un-
derstand, Mr. Counsel, is a copy of the court's findings and his re-
marks rendering his decision in the case cited, this whole document
may be made an exhibit to the testimony, and then any part of it may
be read by either counsel or by the committee.
ISIr. Matthews. Thank you. I am very grateful.
The Chairman. That may be made exhibit 81.
(The document referred to was marked "Exhibit No. 81" for refer-
ence and may be found in the files of the select committee.)
The Chairman. Any part of exhibit 81 can be read.
If he reads one part, you can read the other. Proceed.
Mr. Matthews. Mr. Chairman, and gentlemen of the committee:
The one sentence that I told Mr. Kennedy that I wanted to read is
this :
During the period of 1938 — 48, I have adverted to the fact that Carter signed
some contracts in Fays' name. That Fay probably designated him to do it I
have no doubt because I have been unable to find that Fay had any appreciable
influence on the operation of the union between 1938 and 1948, but Jasper
White did.
So far for the present that is all I\lesire to read.
The Chairman. Any part of it can be read now.
Mr. Matthews. Would you please excuse the markings, sir? They
are hardly a court exhibit. They are self-serving.
Mr. Kennedy. I just want to read the first part of the paragraph.
After an examination of the entire record the court has been impressed that
the union members between 1938 and 1948 were not very well treated by their
superiors, and when I use superior I mean in the terms of the men who had
the business conduct of the union in charge and whose activities did affect
what I choose to call the little man. Two of the most glaring of the faults of
the operation of the union were the percentage assessment of wages and the
practice of charging a weekly license fee for the privilege of working as an op-
erating engineer. They were glaring abuses nnd I may say that while it is un-
important to a decision in this case I have no idea other than that a lot of
these percentage payments reached pockets other than the pocket of the union
treasury.
Mr. Matthews. That, of course, must be read in connection with
the statement I quoted, that from 1938 to 1948, the judge says he
finds that Fay has nothing to do with it.
8084 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. This court decision will speak for itself. All of it
is an exhibit, here. Proceed.
Mr. Kennedy. The point once again is that, although he might not
have been in Philadelphia continuously, it was under his administra-
tion that these assessments were put in of which the judge was so
critical. The judge also pointed out that there was very little ques-
tion in his mind tliat a large part of these assessments went into the
pockets of those other than members of the union, that it went into the
pockets of those that were running the union.
Mr. Matthews. That he did not say. Excuse me for being so flat
in my statement.
Mr. Kennedy. Well, "reached the pockets other than the pocket of
the union treasury."
Mr. Matthews. That is it.
Mr. Kennedy. That would be, I assume, the people who put the
assessment on in the first place and who had control over the state-
ment.
Mr. ^Iatthews. That is non sequitur, I must say, because you must
follow the statement that he fomid no connection between Fay and
that union for 10 years, and the gentleman who discussed it, if it is
apropos of this discussion, was not a member of the union.
The Chairman. Just a moment. The Chair does not want to be
discourteous to counsel or anyone else. We are getting into an argu-
ment here between lawyers as to what one thinks about what the
court decision says, and what the other one thinks. The whole docu-
ment has been made an exhibit to these proceedings. Members of the
committee can now read it and study it for themselves. I just did not
want to prolong the argmnent.
Mr. Matthews. One final word. If it were nonsense, then, of
course, Mr. Kennedy and I were bantering to and fro. His inter-
pretation is one and mine is another.
It is the committee that will have to decide.
The Chairman. Exactly. That's why I thought we should not
waste time.
Mr. Kennedy. Mr. Fay, were you the administrator of the local,
the supervisor of the local ?
Mr. Fay. Supervisor, under the direction of the general president.
(At this point. Senator Goldwater withdrew from t\\& heai-ing
room. )
(Members of the select coimiiittee present at this point are Senators
McClellan and Ervin.)
Mr. Kennedy. You w^ere the supervisor of the local in Phila-
delphia ?
Mr. Fay. Under the direction of the general president.
Mr. Kennedy. While you w'ere supervisor this assessment was put
into eife^t?
Mr. Fay. By the membership at a regular meeting.
Mr. Kennedy. The assessment was put into effect ?
Mr. Fay. Yes, sir.
Mr. Kennedy. Now, was the membership kept informed as to how
this money was used while you were supervisor of the local?
Mr. Fay. I was at one meeting that a financial statement was read
at in reference to the welfare fimd. To get those figures that you
speak about in the millions. I want you to knoAv, Mr. Kennedy, that
IMPROPER ACTIVITIES IN THE LABOR FIELD 8085
in 19;>5 and lJ)o() there was only about 200 members in that local
imion.
Up until the last I knew, there was not over 800 in the whole local
union ; so, I think, wherever they collected all of this money
Mr. Kexxedy. Just answer the question. Was the membership kept
informed as to the use of this money ^
Mr. Fay. As far as I know, they were.
Mr. Kennedy. But do you know specifically that they were in-
formed ?
Mr. Fay. I do, on one occasion. I heard the financial report read
at a meeting.
Mr. Kennedy. But, other than on that one occasion that you know
of, when it was read to them, were the books ever turned over to them
( o show how this money was used ?
Mr. Fay. All I know now is what I could tell you, that White told
me.
Mr. Kennedy. But do you have any personal knowledge that the
books and records of this assessment regarding this money were ever
made available to the members of the union ?
Mr. Fay. Mr. Kennedy, the books and records were available to any
member that knew his rights under his union membership, available
to him in the office.
Mr. Kennedy. Do you know of any time in which they were ever
made available to the members, Mr. Fay ?
Mr. Fay. I, from time to time, would bring Mr. Mike Mogan, the
president of the local union, over and ask him, and he would tell me
that everything in that office was available. Miss Gallaglier, who was
the secretary in the office, had the records available to all members.
Now, the president was the leading officer, as far as I was concerned.
Mogan was the one that told me, at the time when things were not going
just right, that he thought an audit would be a good thing, and I
recommended the same to the international union, and the interna-
tional union sent an auditor in there and made the records available
to the membership.
Mr. Kennedy. Made them avftilable to the membership ?
Mr. Fay. At the meeting, and this report was read.
Mr. Kennedy. That is not the point. That is not the books and
records. That is an audit. All of the figures can be added up, the
money that came in and went oiit, and it tells nothing about where
the money went.
Mr. Fay. I believe that, if any member during those years that I
was acting supervisor, if the}' wanted to see the records of tlie books
in that office, that they could have by correspoiuling with me.
Mr. Kennedy. We have had testimony that at least three individuals
were beaten who were trying to get some of their rights, trying to get
to see the books and records of the local and the contracts. Two of
them are Sam ]Morris and Lou Finney.
Mr. Fay. A^^iat year was that ^
Mr. Kennedy. Do you know anything about that ?
Mr, Fay. No; I don't know, and I want you to know at no time,
when I was supervisor when I visited that local union, did I ever have
any goons or toughies or bodyguards at any time. In reference to
the meetings at 4 or 5 meetings that I attended, there wasn't an argu-
ment or a fight of any kind in those meetings.
8086 IMPROPER ACTIVITIES IN THE. LABOR FIELD
Mr. Kennedy. Prior to taking over that local and being made
supervisor, Mr. Fay, had you ever been arrested ?
Mr. Fay. Yes; I was indicted. I had been arrested and just in-
dicted. The indictment was thrown out.
Mr. IvENNEDY. How many times had you been arrested, prior to
taking over the supervision of this local ?
Mr. Fay. I thinly: in the early twenties, twice or three times alto-
gether, and no convictions. There were fights, and I want you to
know, Mr. Kennedy, that I lived through the years that the busting
of unions and breaking of heads was more or less the tool of our
opponents.
Mr. KENNfiDY. Well, Mr. Hogan, when he was summarizing your
career, said you had not done a tap of physical work since 1919, and
you muscled into the labor-union movement, and that you were ar-
rested as far back as 1916, when you assaulted a retired policeman up
in Troy and then you were shot. Were you arrested in 1916?
Mr. Fay. I was not arrested there, Mr. Kemiedy, and don't get that
in the record.
Mr. Kennedy. You were not arrested in 1916 ?
Mr. Fay. Not with that ; no, sir.
Mr. Kennedy. Mr. Hogan says :
Certainly, Fay's background, particularly, is studded with violence and with
lawbreaking, with unscrupulous and unmoral conduct. As early as 1916, he
assaulted Edward Maloney, a retired policeman up in Troy, and was shot for
his pains in some saloon about 3 in the morning.
Do you remember that ?
Mr. Fay. I was never arrested on that charge.
Mr. Kennedy. You were just shot?
Mr. Fay. I was shot. We were walking along and the man that
the officers of the law claimed shot at me was a man by the name of
Maloney. He was a suspended policeman and was fired from the
police department and we knew nothing about it. As you would be
walking along the street ; I wasn't in any argument with that man at
all.
Mr. Ivennedy. You were arrested in December, according to this
record, December of 1920, charged with attempted extortion by Wil-
liam Nickberger. Do you remember that?
Mr. Fay. Do you know that the records disclosed I never was in-
dicted, and that is in 1922, is it?
Mr. Kennedy. That is 1920, and I believe there was another prob-
lem in January of 1921 regarding you, an accusation of shaking down
one Fred Kilgus for $220 in a boys' vocational high school.
Mr. Fay. I was never arrested on that at all. It was just news-
paper copy.
Mr. Kennedy. And beating up a man by the name of Thrasher in
1928, and you were charged with assault then.
]Mr. Fay. The charge was never processed, and the man went into
court and withdrew it. He was a member of the local union.
Mr. Kennedy. He goes into that, and he said you are one of those
who beat up Bryant Feeney in the Ten Eyck Hotel in Albany in 1938.
Mr. Fay. I wasn't even in the city of Albany.
Mr. Kennedy. And you slugged Dave Dubinsky in New Orleans in
November of 1940.
Mr. Fay. I certainly did not slug Mr. Dubinsky.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8087
Mr. Kennedy. On August 20, 1941, you assaulted H. Orville War-
ner in room 1154 of the Hotel Syracuse,
Mr. Fat. W^"!^^ JO^^ I'^^tl the result of that? It was thrown out,
and the plaintiff did not show up.
Mr. Kennedy. I will read that.
Warner, at the time, was the business agent for the Operating Engineers, the
the local in or near that city. Eight days later, despite the fact that this Warner
was suffering from a fracture of the cheekbone and other facial injuries, he was
summarily removed as business agent of local 832 in Rochester, and it must
be borne in mind that Fay was the eastern representative of the Operating Engi-
neers at that time. Thereafter, and on November 27, 1941, Fay was indicted,
charged with assault in the second degree.
February 2, 1942, Warner is stran.!j,ely missing — can't find him ; the authorities
in Syracuse can't locate him anywhere. February 9, 1942, he is still missing.
The case has been on twice and they can't find him ; couldn't be served. Finally,
later in February, the indictment has to be dismissed. And, lo and behold, in
March of 1942 Warner is restored to his job in the same union at an increase
o^alary — $125 a week.
Mr. Fay. That is not the truth, and let me say this : I went to the
court when I was called in Februaiy, when this trial was to be tried,
with the eight witnesses to prove that in the argument we were in I
protected myself in self-defense, and Warner did not show up because
he knew that these witnesses would testify to exactly what happened.
Mr. Kennedy. Why was he put back on the payroll ?
Mr. Fay. If you knew him, shortly after, or I think he still is in
the insane asylum.
Mr. Kennedy. In 1933 you were charge in a suit brought in chan-
cery court in New Jersey with misusing union funds and refusing
to let members look at the books of the union, and raising the dues
from $5 to $6 a month, using that money to buy stock in a holding
company, with manipulating that holding company so that it pur-
chased a piece of property from Fay himself for a price well behind
its value.
Mr. Fay. I was not an officer of that union at that time.
Mr. Kennedy. Were you chairged with that at that time ?
Mr. Fay. As an investor in that holding company, I guess.
Mr. Kennedy. Did you have other business interests during this
period of time when you were a union official ?
Mr. Fay. Did I have investments ?
Mr. Kennedy. Yes.
Mr. Fay. Yes.
Mr. Kennedy. Did you have business interests in businesses that
had contracts with the Operating Engineers ?
Mr. Fay. Yes, sir, I did.
Mr. Kennedy. What companies did you have business interests in ?
Mr. Fay. One company was the International Excavating Co.
Mr. Kennedy. What kind of work did they do ?
Mr. Fay. They did excavating work and road work and so on and
so forth.
Mr. Kennedy. Then you were indicted, I believe, in 1940, and I am
not going into this in detail, but you were indicted for extorting some
six or seven hundred thousand dollars from employers in 1943.
Mr. Fay. In 1943, yes, sir.
Mr. Kennedy. And you were ultimately convicted of extorting
$300,000.
8088 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Fay. Something like that.
Mr. Kennedy. $362,000.
Mr. Fay. Something like that.
Mr. Kennedy. And then, subsequently, you went to jail and served
time, starting in 1948 ?
Mr. Fay. Yes, sir.
Mr. Kennedy. During the period of time that you were in jail, did
you receive any compensation from the local union or from the inter-
national union ?
Mr. Fay. I did not, sir.
Mr. Kennedy. Did any of your relatives receive any compensation ?
Mr. Fay. They did.
Mr. Kennedy. Who received compensation ?
Mr. Fay. Mrs. Fay.
Mr. Kennedy. Your wife ?
Mr. Fay. Yes, sir.
Mr. Kennedy. Had she worked for the union prior to that time ?
Mr. Fay. No.
Mr. Kennedy. She was put on the payroll of the local union ?
Mr. Fay. She was.
Mr. Kennedy. And for what salary ?
Mr. Fay. I believe the first salary that she was put on the payroll
for was $125 a week.
Mr. Kennedy. Did she do any work for that ?
Mr. Fay. Instead of the union doing that, I always want to think
that the membership of that local union did that because at that time,
Mr. Kennedy, all of our funds were tied up completely by a Govern-
ment tux case.
Mr. Kennedy. Against whom ?
Mr. Fay. Against me.
Mr. Kennedy. Wliat do you mean, the union funds were tied up in
a tax case ?
Mr. Fay. My funds.
Mr. Kennedy. What about the union? Did they pay any of your
legal bills ']
Mr. Fay. I believe they did.
Mr. Kennedy. How much of your legal bills ? Did they pay any
legal bills when you were charged with extortion?
Mr. Fay. In the case ?
Mr. Kennedy. In which you were convicted.
Mr. Fay. In 1943, 1 believe they did.
Mr. Kennedy. They paid all of those legal bills?
Mr. Fay. No, sir.
Mr. Kennedy. How much did the union pay for your legal bills?
Mr. Fat. I wouldn't know that, but I know from the attorneys that
did get j^aid, they called me and said it was a matter between the
client and them, that they were going to give your committee an exact
amount that they got paid. And I told them it was perfectly all
right wnth me.
Mr. Kennedy. How much, approximately, did the lawyers get?
You must have an approximation as to how much the local union paid
for your legal bills when you were indicted and convicted of extortion.
Mr. Fay. Mr. Kennedy, I am on strict parole and my provisions of
IMPROPER ACTn^ITIES IN THE LABOR FIELD 8089
that parole are not to be in any way active in labor unions. If I Avere
to ask that local union how much they paid of lawyer fees, I feel I
would be violating my trust.
Mr. Kennedy. You never found out prior to that time ?
Mr. f'AY. I did not.
Mr. Kennedy. You do not know how much the local paid?
Mr. Fay. I do not.
Mr. Kennedy. You just know they paid the bills ?
Mr. Fay. They paid some of them.
Mr. Kennedy. Then your wife, while you went to jail, was put on
the payroll of the local or the international union?
Mr. Fay. The local union.
Mr. Kennedy. And she was put on beginning at $125 a week, for
which she did no work, isn't that correct ?
Mr. Fay. I wouldn't say that. You have said that, but
Mr, Kennedy. Do you know that she did any work ?
Mr. Fay. I couldn't know. I was away.
Mr. Kennedy. You never knew that she did any work, did you?
Mr. Fay. She was assistant or secretary to the president.
Mr. Kennedy. I know what her position was, but did she ever do
any work for it, Mr. Fay ?
Mr. Fay. Clerical work, and that. She has been down to the office
quite often, I believe.
Mr. Kennedy. Did she ever do any work, Mr. Fay ? Did she ever
do any work for the local union ? Did she go to the office every day
and perform work ?
Mr. Fay. Again, if I were to act in that, that would be taking an
active part in union affairs. I don't know that.
Mr. Kennedy. Your wife was on the payroll and you talked to your
wife and you talked to a number of the officials from the union and
they came to visit you and you know she didn't do any work.
Mr. Fay. I do not know that, sir.
Mr. Kennedy. Do you know that she did any work ?
Mr. Fay. No, sir.
Mr. Kennedy. How long did she remain on the payroll of the local ?
Mr. Fay. Until I came home, 9 years.
Mr. Kennedy. In January of 1956 ?
Mr. Fay. In January or Februai-y of 1956.
Mr. Kennedy. And was her salary paid during this whole period
of time, this $125 ?
Mr. Fay. Yes, sir.
Mr. Kennedy. And was it subsequently raised to $150 and then
$175 a week?
Mr. Fay. I believe it was.
Mr. Kennedy. And you do not know of any work that she did ?
Mr. Fay. I don't know of any work she did, or she did not.
Mr. Kennedy. Was she taken off the payroll in January of 1957?
Mr. Fay. When I came home.
Mr. Kennedy. January of 1956, 1 believe.
Mr. Fay. Yes, sir.
Mr. Kennedy. Do you receive any money from the union at the
present time ?
Mr. Fay. Yes, sir, I do.
Mr. Kennedy. How nnich money do you receive from the union ?
8090 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Fay. I receive a pension of $10,015 a year net from the union.
Mr. Kennedy. Is that after taxes ?
Mr. Fay. That is after taxes.
Mr. Kennedy. You receive a little over $10,000 a year from local
825?
Mr. Fay. I do, sir.
Mr. Kennedy. After taxes, and that would be some $12,600 before
taxes ?
Mr. Fay. Something like that, whatever it is.
Mr. Kennedy. Was that a pension that you paid into ?
Mr. Fay. Just my membership for 48 years or 49 years.
Mr. Kennedy. You mean this was
Mr. Fay. It was no set up pension.
Mr. Kennedy. This was to reward you for your services to the
Operating Engineers ?
Mr. Fay. I would want to think, and always will think and again 1
say the membership of that local union gave me that pension and not
the union.
Mr. Kennedy. Mr. Hogan described you as someone who double-
crossed the rank and file of organized labor and brought disgrace
to the labor union movement.
Mr. Fay. If you were to look over those agreements, and the wages
and conditions that I got for those men, you would not agree with
Mr. Hogan, I don't believe.
Mr. Kennedy. He is describing you :
In this case, however, the consideration of the nature of the crimes of which
the defendants stand convicted, of the merciless course of conduct, their shame-
less betrayal of the union members who paid them their salaries, and their
history as labor ofBcials, leads me to conclude —
and then he goes on to recommend against giving you any mercy.
The point is that you were found guilty of extortion, some $63,000.
Mr. Fay. On 1 count out of 7.
Mr. Kennedy. And you were found guilty of extortion.
Mr. Fay. And I went through all of the courts and I got 6 of the
finest jurists in the country to say that I wasn't given a fair trial,
4 supreme court justices.
Mr. Kennedy. They upheld the conviction.
Mr. Fay. They did, and I respected it.
Mr. Kennedy. And you served the time, your wife was put on
the payroll while you were in prison and you were given a special
pension amounting to some $12,600 as of January 1956.
Mr. Fay. Did I what?
Mr. Kennedy. You were given this special pension of $12,600 as
of January 1956.
Mr. Fay. Yes, by the membership of the local union that I rep-
resented for more than 30 years.
May I ask a question? My lawyer, Mr. Matthews, has with him
a resolution that was passed by the membership at a specially called
meeting that was not in any way prompted by me. I only hope that
you will see the fairness in letting Mr. Matthews read it or make
it a part of the record that the honorable Senators and yourself can
read it.
The Chairman. It may be submitted if you care to do so.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8091
Mr. Matthews. I do not desire to read it. If you will have it
in evidence it will save time and you can mark it.
The Chairman. We will make it an exhibit if you care to submit
it.
Mr. Kennedy. We have it.
The Chairman. All right, it will be made Exhibit No. 82. (The
document referred to was marked "Exhibit No. 82" for reference
and may be found in the files of the select committee.)
Mr. Kennedy. Mr. Fay, this was not a pension in which you paid
into it originally, was it ?
Mr. Fay. No, only by payment of my membership.
Mr. Kennedy. So what it is in fact is that you are receiving a
salary of $12,600 a year?
Mr. Fay. Well, the resolution doesn't read that way. It says a
pension for my service.
Mr. Kennedy. You might describe it as a pension, but you never
paid into it and you did not have any right to it, any legal right to
the pension and you just receive $12,600 every years ; isn't that correct ?
Mr. Fay. Yes, or no, I don't get that every year.
Mr.IvENNEDY. You get $10,000?
Mr. Fay. Yes, sir.
Mr. Kennedy. And they pay the taxes ?
Mr. Fay. And I got that pension because of my 40 years or 48 years
of membership and I also got an honorary membership card as a 40-
year lifetime member in the union and all of this is said in the resolu-
tion.
Mr. Kennedy. Is that 40 years including the 9 years that you spent
in Sing Sing?
Mr. Fay. The 40 years, yes, sir.
Mr. Kennedy. It does include that ?
Mr. Fay. Yes, sir.
Mr. Kennedy. That was included in the 40 years ?
Mr. Fay. Yes, sir. Mr. Kennedy, I want to say this : That when
this matter came up, that I was convicted on, in the local union that
I represented I reported to them in 1937 each and eveiything con-
cerning the moneys that was talked about with I'eference to these
contractors on the job. At that time when that fight came on, between
the sandhogs against the contractors and the other trades, we went in
there and the contractors agreed and they so testified — that they agreed
to pay the cost of the pickets, the dual pickets against these unruly
sandhogs.
Mr. Kennedy. That case has already been decided by the court.
Mr. Fay. And you bring it up and the conviction and it is only
fair that I could have an answer to that. The only reason why I
went tlirough this, and the cost to the local union and myself money
for the lawyers, is that fact, that the local union which I represented
honestly and truthfully felt that I was innocent of that crime and I
did myself.
Mr. Ivennedy. Does every member of the Operating Engineers who
has served for 40 years receive a pension or receive a salary, an honor-
ary salary or a pension of this type amounting to some $12,000 ?
Mr. Fay. They don't.
Mr. Kennedy. Do you know anyone else other than Joey Fay ?
Mr. Fay. Who did you say ?
8092 IMPROPER ACTnaTlES IN THE LABOR FIELD
Mr. Kennedy. Do you know anyone else other than Joseph S.
Fay?
Mr. Fay. No, sir, I don't, but I just want to correct you. I don't
know "Joey Fay," at all.
Mr. Kennedy. Excuse me. Has your membership been restored in
the Operating Engineers ?
Mr. Fay. It was.
Mr. Kennedy. As of what date ?
Mr. Fay. As of June of 1947 when I was suspended by the inter-
national and never by the local union. The local union never sus-
pended me and when I came home without any prompting and I
want you to believe me, on my part, the local union itself and its offi-
cers reinstated me without any disturbance of my membership of
more than 40 years.
And after I was home a year they presented me with a 40-year life
membership.
Mr. Kennedy. So your membership has been restored as of the
time that you were convicted and started your prison term in 1947 ?
Mr. Fay. That is right, sir.
(At this point, the following members were present: Senators Mc-
ClellanandErvin.)
Mr. Kennedy. Again, Mr. Hogan had something to say about those
individuals in your union who were able or should stand up. He
said —
What do you think, your Honor, would happen to a person who took his eco-
nomic livelihood in his hand by coming into the union hall and saying what he
thought of the problem?
That was even at that period of time.
Mr. Fay. To prove that out, I wish that you would attend a meeting
of 3,000 or 4,000 members that attend those meetings, and you would
find out that the version that Mr. Hogan puts on it is not the truth.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. We referred to an H. Orville Warner, did we not,
awhile ago ?
Mr. Fay. He was what ?
The Chairman. Mr. Warner.
Mr. Fay. Yes, sir.
The Chairman. I have a letter from him. I will read you one
statement regarding that case. I believe he is the witness that did
not show up for trial.
Mr. Fay. That is right.
The Chairman. The fellow that had the broken jaw.
Mr. Fay. He didn't prove that he didn't have it, the doctor.
The Chairman. But that is in the statement, as I recall it. That
was the Mr. Warner ; wasn't it ?
Mr. Fay. Yes, sir.
The Chairman. I have a letter from him dated December 7, 1957.
Among other things, I will read this statement :
If you recall, I belonged to the union for several years, and I was a party to
stopping the stealing of union funds at the local to which I lielonged. During the
course of this, I was beaten up in Syracuse, N. Y., and I had Joe Fay indicted.
I was taken under guard out of jurisdiction of the court before it came to trial,
and the witnesses, friends of mine, were paid to take long trips so that they could
not l)e summoned to give testimony.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8093
Do you have any information regarding that ?
Mr. Fay. That is a complete untruth.
The Chaermax. That is completely untrue ?
Mr. Fay. Yes, sir.
The Chairman. All right.
Mr. Fay. That man, if you will trace his record
The Chairman. The reason I am reading this to you now is to give
you a chance to deny it or comment upon it any way that you want to.
Again, if this witness appears and testifies accordingly, there will be
a decided conflict to your testimony here.
I think it is of interest to this committee to know what that is,
another instance, or if it is an instance of methods and practices being
employed, by the Operating Engineers in matters relating to union
affairs.
Mr. Fay. It is a complete untruth.
The Chairman. He also said that he has not been allowed to work
since the early part of 1947. He has not been able to get a job since.
Is he prevented from working simply because of the action he took
against you, Mr. Fay ?
Mr. Fay. No, sir, he is not, sir.
The Chairman. It is not on that account ?
Mr. Fay. No, sir. I wouldn't be a party to that.
The Chairman. It is not because he preferred charges against you ?
Mr. Fay. No, sir.
The Chairman. That is the implication. Since he may appear at
a later date when you are not present, I wanted to give you this in-
formation so that you might comment on it.
Mr. Fay. If you would trace his record, you would find out, I am
sure, that this Senate committee would not have nothing to do with
him.
The Chairman. We might not have anything to do with him?
Mr. Fay. No, you certainly would not.
The Chairman. All right. Is there anything further this after-
noon ?
Senator Ervin.
Senator Ervin. Mr. Warner did procure a criminal prosecution
against you ; didn't he ?
Mr. Fay. Warner?
Senator Ervin. Yes.
Mr. Fay. This happening was in June — I forget the year, but it
was in June — and he got first in the meanwhile by the membership,
and I backed up the membership. In October of that same year he
went in and brought this episode up where I protected myself in self-
defense. It was 4 months after the thing happened.
Senator Ervin. You haven't answered the question yet.
Warner did set in motion a criminal prosecution against you for
assault and batterv upon him; didn't he?
Mr. Fay. He did.
Senator Ervin. And the case was set down for trial twice?
Mr. Fay. Riglit.
Senator Ervin. And on both oi'casions, Warner failed to a]ipear as
a prosecuting witness ?
Mr. Fay. Right, sir.
21243— 5«-^pt. 20 12
8094 IMPROPEK ACTIVITIES IN THE LABOR FIELD
Senator Ervin. Do you know where Warner was on those two oc-
casions ?
Mr. Fat. I certainly did not, sir, and I so told the court.
The Chairmax. The committee will stand in recess until 10 : 30
tomorrow morning.
(At this point the following members of the committee were pres-
ent: Senators McClellan and Ervin.)
(Whereupon, at 5 : 30 p. m. the hearing was recessed, to reconvene
at 10 : 30 a. m. Wednesday, January 29, 1958.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGE3IENT FIELD
WEDNESDAY, JANUARY 29, 1958
United States Senate,
Select Committee on Improper Activities
IN THE Labor or Management Field,
Washington, D. G.
The select committee convened at 10 : 30 a. m., pursuant to Senate
Resolution 74, agreed to January 30, 1957, in room 457, Senate Office
Building, Senator John L. McClellan (chairman of the select com-
mittee) presiding.
Present : Senator John L. McClellan, Democrat, Arkansas ; Senator
Sam J. Ervin, Jr., Democrat, North Carolina; Senator Pat McNa-
mara, Democrat, Michigan; Senator John F. Kennedy, Democrat,
Massachusetts; Senator Karl E. Mundt, Republican, South Dakota;
Senator Carl T. Curtis, Republican, Nebraska.
Also present : Robert F. Kennedy, chief counsel ; Jerome S. Alder-
man, assistant chief counsel; Alphonse F. Calabrese, investigator;
Jack S. Balaban, a GAO investigator on loan to the select committee ;
Robert Worrath, investigator ; Ruth Young Watt, chief clerk.
The Chairman. The committee will come to order.
(Members of the select committee present at the convening of the
session were : Senators McClellan and Mundt. )
TESTIMONY OF JOSEPH S. FAY, ACCOMPANIED BY HIS COUNSELS,
JOHN A. MATTHEWS, WILLIAM J. EGAN, AND JOHN J. EGAN—
Eesumed
The Chairman. The photogra4:)hers will take their pictures right
away. The witness has requested that there be no pictures made while
he is testifying. He has been cooperating with the committee, and
we will cooperate with him in that request.
All right, Mr. Counsel, proceed.
Mr. Kennedy. Mr. Fay, we were discussing yesterday the situation
regarding your pension, and the amount of money that you receive.
We were also discussing the fact that your wife was paid while you
were away. Did your wife receive any other salaries, fees, or benefits
of any kind that you know of ?
(At this point. Senator McNamara entered the hearing room.)
Mr. Fat. From where, Mr. Kennedy ?
Mr. Kennedy. From the union, local 825, the international, or any
other union of the operating engineers.
Mr. Fay. Not to my knowledge ; no, sir.
8095
8096 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. She received no other moneys from the union other
than the $125, raised to $150, and then to $175 ?
Mr. Fay. No, sir; not to my knowledge. I would know that, be-
cause we make a joint return, income-tax return, and I know that
she received no othei^money from any other union.
Mr. Kennedy. Do you know if she received a Christmas bonus each
year ?
Mr. Fay. I am not sure, but I l)elieve I saw that on the income-tax
return ; yes, sir.
Mr. Kenned^'. So she did receive something extra. Do you know
how much the Christmas bonus was ?
Mr. Fay. No, sir ; I do not.
Mr. Kennedy. Would the figure of $500 a year at Christmas sound
about right to you ?
Mr. Fay. Well, what do you mean by would it seem right ?
Mr. Kennedy. Is that the figure? Do 3^ou remember seeing that
figure on your income-tax return ?
Mr. Fay. Well, Mr. Kennedy, if that was right with the member-
ship of that local union, I would say it would be right, yes, sir. But
I don't recall ; no, sir.
Mr. Ivennedy. You don't remember whether that was the figure
that she received, the $500 Christmas bonus that she received each
year from the union ?
Mr. Fay. That is exactly what I said.
Mr. IvENNEDY. You do not remember that ?
Mr. Fay. No, sir.
Mr. KJENNEDY. You don't know anything about that ?
Mr. Fay. I said that I remembered some extra payment, when I
countersigned the tax return, and that is all I remember. Wliether it
was $500 or $200, I do not know. I don't know the number.
Mr. Kennedy. Was there anything else that came to her other
than the salary and the bonus ?
(The witness conferred with his counsel.)
Mr. Kennedy. I think he can answer the question, Mr. Counsel.
Mr. John J. Egan. I am sure he can, Mr. Counsel.
Mr, Fay. With the exceptions of some investment of interest
Mr. Kennedy. I am talking about the miion.
Mr. Fay. No, sir ; that is all I know about.
Mr. Kennedy. Did she also receive an automobile from the union ?
Mr. Fay. I believe in 1952 she did ; yes, sir.
Mr. Ivennedt. The union gave her an automobile?
Mr. Fay. As far as I know ; yes, sir.
Mr. Kennedy. That is what I understood.
Mr. Fay. I believe she told me that ; yes, sir.
Mr. Kennedy. So in addition to the salary, slie received a bonus,,
and she also received an automobile from the union ?
Mr. Fay. Well, I just answered that; yes, sir.
Mr. Kennedy. I see. You said that you sell automobiles yourself
now?
Mr. Fay. I do, sir.
Mr. Kjinnedy. And you have been selling automobiles since 1956 ?
Mr. Fay. Since April 1956 ; yes, sir.
Mr. Kennedy. Well, do you
IMPROPER ACTIVITIES IN THE LABOR FIELD 8097
]\Ir, Fay. Required by the parole authorities that I am supervised
by.
Mr, Kennedy. Do a number of those automobiles go to local 825 ?
Do you sell automobiles to 825 ?
Mr. Fay. I sell automobiles to anyone that comes in to buy them.
Mr. Kennedy. Does local 825 of the operating engineers purchase
their automobiles from you ?
Mr. Fay. They have purchased some there ; yes, sir ; not all.
Mr. Kennedy. Do other unions in the New Jersey area purchase
automobiles from you ?
Mr. Fay. Some of the unions, but not too many. You have to meet
prices and that counts.
Mr. Kennedy. How many automobiles have you sold ?
Mr. Fay. What year?
Mr. Kennedy. Since April 1956.
Mr. Fay. Since April ?
Mr. Kennedy. Since you started selling automobiles, how many
automobiles have you sold ?
Mr. Fay. Do you want the record of how many I did ? I gave it to
your committee, Mr. Kennedy.
Mr. Kennedy. I want to make sure that this is accurate. According
to the records, and you correct me
Mr. Fay. I also report to the parole board exactly each 6 months.
Mr. I^NNEDY. I understand. But according to the records as we
understand, you sold the 14 automobiles as of — well, since you started.
Could we swear Mr. Calabrese, Mr. Chairman ? Could he testify
as to how many automobiles there were ?
The Chairman. You have not been sworn. Do you solemnly swear
the evidence you shall give before this Senate select committee shall
be the truth, the whole truth, and nothing but the truth, so help you
God?
Mr. Calabrese. I do.
TESTIMONY OF ALPHONSE F. CALABRESE
The Chairman. State your name.
Mr. Calabrese. Alphonse F. Calabrese.
The Chairman. You are a member of the investigating staff of this
committee ?
Mr. Calabrese. I am.
The Chairman. You made some investigation into the area of the
subject matter under inquiry of the witness on the stand ?
Mr. Calabrese. I did.
The Chairman. Proceed.
Mr. Kennedy. Mr. Calabrese, have you studied the records to deter-
mine how many automobiles have been sold by Mr. Fay since 1956 ?
Mr. Calabrese. Yes; I have. The figure of 114 cars have been sold
by Mr. Fay for the period that he began employment with the DeCozen
Motor Co.'i in March of 1956, to the latter part of 1957.
Mr. Kennedy. From April 1956 to about December of 1957 ?
Mr. Fay. Yes.
8098 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OF JOSEPH S. FAY— Resumed
Mr. Kennedy. Are those figures correct ?
Mr. Fay. Those are from the records from the office.
Mr. Kennedy. How many of those automobiles that you sold have
been paid for by unions ? Do you have those figures ?
Mr, Fay. I don't have the figures exactly, but I would say about —
directly ? Are you asking me directly to the unions ?
Mr. Kennedy. Well, first, how many of those 114 automobiles
have been sold to unions, union officials, or union members?
Mr. Fay. Union members, too ?
Mr. Kennedy. Yes.
Mr. Fay. Well, I would say
Senator Mundt. Could you break it down in categories, Mr. Fay ?
A union member is like anybody else.
Mr. Kennedy. Let's leave it to union officials and unions.
Mr. Fay, I would say less than 60 percent.
Mr. Kennedy. You don't have the figures ?
Mr. Fay. I don't have the exact figures, but I went over them in
answer to your committee, when Mr. Calabrese asked me those ques-
tions, and I answered them, and I think it broke down to about 50
percent or less than 50 percent.
It is a little less than 50 percent, too, I would say. That is liis
own judgment,
Mr, I^nnedy, Mr, Chairman, I would like to swear Mr. Cofini,
who has made a study of the records. He is another investigator.
The Chairman. Do you solemnly swear the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth and nothing but the truth, so help you God ?
Mr. Cofini. I do.
TESTIMONY OF ROBEET J. COFINI
The Chairman. State your name, occupation, and residence.
Mr. Cofini. My name is Robert J. Cofini. I am an accountant as-
signed to this committee from the United States General Accounting
Office.
The Chairman, You work for the General Accounting Office?
Mr. Cofini. Yes, I do.
The Chairman. You have been assigned to this committee to assist
its stafi'?
Mr. Cofini. Yes.
The Chairman. Have you made an examination of the records to
determine with respect to the sale of these cars, to whom they were
sold?
Mr. Cofini. Yes ; I have.
The Chairman. All right.
You may testify accordingly,
Mr, Kennedy, Mr. Cofini, have you made a study based on the
information that Mr. Fay has supplied to the committee, and your
own independent investigation — to determine out of 114 automobiles
that have been sold by Mr. Fay since the beginning of this employ-
ment, March 29, 1956, up to and including November 14, 1957, there
IMPROPER ACTIVITIES IN THE LABOR FIELD 8099
were 38 cars Avhicli were properly identified as having been sold to
various local unions, and/or union officials or members?
The Chairman. Thirty-eight ?
Mr. CoFiNi. Thirty-eight.
Mr. Kennedy. That includes members, does it? Well, how many
of those 38 cars can you actually say were paid for by the union or
were paid for out of union funds ?
Mr. CoFiNi. Thirty.
j\lr. Kennedy. Thirty ?
Mr. CoFiNi. Thirty cars out of thirty-eight.
Mr. Kennedy. The others you are unsure of ?
Mr. CoFiNi. That is right.
Mr. Kennedy. How^ many of those 30 cars were sold to Local 825
of the Operating Engineers ?
Mr. CoFiNi. Ten.
Mr. Kennedy. Ten of them ?
;Mr. CoFiNi. Yes.
TESTIMONY OF JOSEPH S. FAY— Resumed
Mr. Kennedy. This local began buying their automobiles from you,
Mr. Fay, starting in April 1956 ?
jNIr. Fay. They started buying them from me ?
Mr. Kennedy. Yes.
Mr. Fay. No. They were buying Chrysler cars long before.
]Mr. Kennedy. But after you became a salesman for the company,
they started buying them through you ?
Mr. Fay. They bought some of them, but not all of the cars from me.
Mr. Kennedy. Do you know^ Longy Zwillman ?
Mr. Fay. Do I know Longy Zwillman ?
Mr. Kennedy. Yes.
Mr. Fay. Yes; I do.
Mr. Kennedy. Does he buy his automobiles from you, also ?
. Mr. Fay. No, sir.
Mr. Kennedy. How about his wife ?
Mr. Fay. I did sell to his wife.
Mr. Kennedy, How many cars did you sell his wife ?
Mr. Fay. Two.
Mr. Kennedy. 1956 and 1957?
Mr. Fay. That is right, sir. Mr. Kennedy, I would like to say to
you, so that the Senators will know, prior to me being employed by
the automobile agency, I was brought before the parole authorities
and my employer, Mr. DeCozen, and we went over all the matters
concerning the sales of cars. It was told to me that it was my right and
privilege to sell cars to whoever came into buy cars, as long as I did
not in any w^ay take any activities in labor functions. I so carefully
guarded myself so that I would abide by their decision that when
a union official comes in to buy a car I ask him to negotiate that
car sale with the president of that agency, Mr. Woodward Fields.
Therefore, all of these sales directly, that were sold to unions or
union officials, I had the full authority to, and at all times I notify the
parole officials of anything that I might do in selling cars that may
be on a borderline of violation of my parole.
8100 IMPROPEIR ACTIVlTIEiS IN THE L.\BOR FIELD
Mr. Kennedy. I don't question that, or the fact that yon are cer-
tainly in a legitimate business. The only thing that we are inquiring
into is what the facts show, Mr. Fay : That you were sent to prison
for extortion, that you were denounced at that time for betraying
the rights of union membei-s, betraying the members of unions, and
while you were in prison, according to the records, and according to
your testimony, the union kept your wife on the payroll, for which
evidently she did not work; they gave her a bonus, they gave her
an automobile. When you got out of prison, they arranged for you
to get a retroactive pension and put you back in good standing. Now
there is this other thing, one additional matter, of a close affiliation
at least with local 825 and other unions seeming to go to you to buy
their automobiles.
Mr. Fay. Mr. Kennedy, I want to say this: The 5,700 men that
employed me at the time that I got into this controversy or trouble,
they, from that time until this day, have been loyal to me. Why ?
Because they don't feel that I was guilty of that crime because I
had notified my emploj^er, the rank and file members of that union —
I notified at many, many meetings, and from then on they saw fit
to continue their loyalty to me, and in my opinion, as I said yes-
terday, I don't believe that the union itself, as a union, reinstated
me or gave me a 40-year membership card or gave me a pension or
gave Mrs. Fay a salary while I was away in prison. It was the
membership themselves, the individual membership that knew of my
30 years of loyalty to that union that was the people that was acting
and speaking and giving me that support that I have to this day.
The Chairman. Mr. Counsel, there is one statement that I don't
know whether the record bears out or not. I wanted to get clear on
it myself.
There was mention of a pension retroactive. When did the pension
begin? Was it from the time that he was released, or was it made
retroactive for the period that he was away ?
Mr. Kennedy. His wife remained on the payroll — you correct me
if 1 am wrong — to January of 195G, when, I believe, Mr. Fay came out
of prison. The pension was actually voted in, I believe, April of
1956. April or May.
Mr. Fay. Yes. I was notified on June 6.
Mr. Kennedy. I believe it was voted in May 1956, and it was made
retroactive to the January date when Mr. Fay's wife was taken off the
payroll. Is that right ?
Mr. Fay. That is right, sir, but not while I was away.
The Chairman. That would be retroactive for 2 or 3 months.
Mr. Fay. Yes, sir.
The Chairman. I wasn't clear as to what the testimony showed,
whether it was retroactive for a long period, or just from the date that
you were released.
Senator Mundt. I was interested in what Mr. Fay said about the
fact that the pension and salaries to his wife and some other things
he mentioned were all brought about because of the loyalty of some
5,000 members of the union.
I want you to expand a little further on what you mean by that.
Is that something that the board of directors or the executive committee
or the officials voted, and then the union members affirmed, or is it a
IMPROPER ACTIVITIES FN THE LABOR FIELD 8101
movement which bubbled up within the membership itself from the
floors
Did someone make a motion to <^ive Fay a pension, or to give his
wife a salary ?
I think there is a little difference between a spontaneous movement,
which it might have been, of somebody who belongs to a union and
gets up and makes a motion, or whether it is one of these kind of
meetings that we heard about a couple of days ago where fellows in
the front run the union meeting pretty nuich to their own notion.
Mr. Fay. Well, Senator, this goes back 25 years to 1936. This large
project and construction work started. Our problems were many in
establishing a prevailing rate of wages, as it was then during the
depression.
Over those years, I went along and established on the various jobs
in a period of 4 years an increase in salary of $1,625 an hour.
Senator Mundt. What union are you talking about now?
Mr. Fay. My union that I was representing. The union that I
represented.
Senator Mundt. This is not the one we were talking about yesterday
over which you were a supervisor ?
Mr. Fay. No, sir; the union that I represented for more than 30
3^ears.
Senator Mundt. As president?
Mr. Fay. Local 825.
Senator Mundt. As business manager, or what?
Mr. Fay. I was just business agent, sir.
Senator Mundt. This is tlie one in New Jersey ?
Mr. Fay. And all of the acts from year to year, and month to month
that I took in regard to my line of duty, I reported to my union, and
my employer each week we Avould meet. They knew the complete
picture.
Senator Mundt. You mean the membership meeting?
Mr. Fay. The membership knew the complete picture and it was
reported on at each meeting, with reference to the progress that was
made. There was no new thing to them. They knew it, and they
were coming out of the depression, and they were getting this work,
and they knew what I had accomplished, with the union members in
back of me. It wasn't any new thing at all.
When it came up to this happening of their goodness to Mrs. Fay
and myself, the members themselves done it and ordered the officers
to carry on. There wasn't one vote at any time— do I ever know of —
one vote that was opposing to this action.
So therefore there has to be, in my opinion, in the mind of any
fair man, the knowledge that their loyalty didn't come — they weren't
afraid of Jo Fay.
I never had any goons or tough guys or people around me that were
disrespectful. I represented the labor movement in the fashion that I
believe it should be represented. That is the reason why their loyalty
has carried on and this action was taken by no act of mine, and I
never spoke in my life to ask a member with reference to a pension
and I never asked to liave Mrs. Fay placed on the payroll as a secretary
of that union. Never in my life did I.
8102 IMPROPER ACTIVITIES IN THE Ll\BOR FIELD
It came from the membership who knew the work that I had done
and the things that I had accomplished for the best interest of the
membership of that local miion. That is a truthful story.
Senator Mundt. Counsel used a phrase about Mrs. Fay, $9,000 or
$10,000 for which she evidently did no work. Is that correct, or is that
incorrect ?
Mr. Fay. I would rather, Senator, to have the men who employed
her answer that question.
The resolution that was passed for her employment and the presi-
dent of the organization who employed her — I don't believe that Mrs.
Fay was a competent stenographer that took shorthand or anything
like that, but I know that she was always ready and willing to do
whatever the president of that organization asked her to do, in going
and visiting the sick and doing the things she had done all of her
life.
She had grown up in this organization from 1919. All of those
years she was with me.
Senator Mundt. Over a period of how much time did she serve as
secretary ?
Mr. Fat. I couldn't honestly answer that. I never did ask her
how much time she did serve.
Senator Mundt. I mean how many years ?
Mr. Fay. All of the time I was away.
Senator Mundt. Was that 5 years ?
Mr. Fay. Nine years, sir.
Senator Mundt. Do you know whether or not she put in office hours
or was expected to ? I do not know, and I am trying to find out the
facts, and maybe they were doing this out of the goodness of their
hearts, to help the family while you were away. I don't know. I
want to find out the facts.
Mr. Fay. I think the greatest reason for her being placed on there
was the knowledge that the membership of that union had for the
loyalty she and I had shown in the early days when the membership
of that local union was 129 or 139 members.
I grew up with it. Senator. At one time I remember that she had,
during the depression, 19 of the members as boarders or roomers in the
house and that was only because they didn't have a roof over themselves.
In my opinion they respected her and loved her in every way.
Mr. Kennedy. I am glad to hear what you have to say about your-
self, Mr. Fay, but the facts are that you were indicted initially for ex-
torting large sums of money from employers, and that you were found
guilty ultimately of extortion amounting to some $62,000.
You were denounced at that time as a ruthless and grasping thief
and for betraying the members of your union.
Mr. Hogan at that time went into the fact tliat none of the union
members of 825 would dare speak up against you, because they would
lose their lives and lose their livelihood.
We have had sworn testimony before this committee, in the last 2
or 3 days, regarding the activities down in Pliiladelphia, of a union in
which you were trustee or a local over which you had control. We
have had that testimony, and despite that, arrangements were made
for you to be on the payroll.
I want to put these figures in the record now, if I may, Mr. Fay,
as to what your wife received. And from the information that we
IMPROPER ACTIVITIES IN THE LABOR FIELD 8103
know, and I think it is supported by your testimony, tliis is money
that she received for whicli she did no work.
Mr. Fay. I didn't say that, sir.
Mr. Kennedy. She did no stenographic work.
Mr. Fay. I didn't say that either.
Mr. Kennedy. In addition to that, your union, the international
union, must have felt that you did wrong because they expelled you
from the union. They took action and expelled you from the union.
Mr. Fay. Do you know, Mr. Kennedy, that the local union has that
right of expelling a member in that local miion ? I was expelled as a
vice president but never expelled or suspended by the local union
which I was a member of.
My. Kennedy. Once again we go back to the fact that Mr. Hogan
pointed that out, in his summary, and he said that the members of the
local would not dare speak against you because they would lose their
lives or their livelihood. You were found guilty
Mr. Fay. That is so far from being the truth.
Mr. Kennedy. You were found guilty, Mr. Fay, and as lie pointed
out, you had a life involved in ruthlessness and exploitation.
Mr. Fay. Let me say this, Mr. Kennedy, that I have the greatest
respect for Mr. Hogan, and I think he is one of the greatest district
attorney's in the country. I don't believe what you are saying here
today, that Mr. Hogan would say.
Mr. Kennedy. I have the statement.
Mr. Fay. I don't believe he would.
]Mr. Kennedy. We will put the figures in the record.
Mr. Fay. Because the membership of that local union, 5,000 mem-
bers— do you think that anybody or does anybody ever call me some
pug-ugly, or some person that goes around looking for fights or
anything ?
I lived during the time that the busting of unions and the breaking
of skulls was the tools of our opponents. I say that because during
those years, in the early twentys, it was hard going to organize the
men.
Mr. Kennedy. I think the record speaks for itself as to what you
have said. We can just go on. I will just put the figures in.
Mr. Matthews. May I speak a word for my client, and I don't want
to seem to be prompting, but I want to make a suggestion that he
make to you.
(The witness conferred with his counsel.)
Mr. Fay. Mr. Kennedy, I would like to ask if any individual niem-
ber of the union that I have a pension from ever made a complaint to
this committee at any time ?
Mr. Kennedy. We called, for instance, 3 of the members of 825 last
night, just to find out about the pension. We saw 7 or 8 this morning.
Now, the ones that we talked to last night never knew that you
ever received this money. The ones we talked to this morning did
know that you had received it. But these last night were individuals
who were members of local 825 and had never known that you re-
ceived this money.
Mr. Fay. Let me say this, that the members — they have a member-
ship, or we did at that time, of 5,500. We would send special notices
out, and you couldn't get over 25 percent of that amount out at any
time.
8104
IMPROPER ACTIVITIES IN THE Ll\BOR FIELD
Mr. Kennedy. We can go on and finish with this.
Mr. Fay. All right.
Mr. Kennedy. Mr. Calabrese has the figures.
Mr. Calabrese. For Mrs. Fay's salaries, the figures show that she
started to receive on July 1947, $125, and for the rest of the year
she received a total of $2,875. That is from July through December
of 1947. That is when her salary was $125.
In 1948 she received a total of $6,500. In 1949, $6,500, and in
1950, $6,500.
Mr. Fay. Mr. Kennedy, this isn't a true record of the money that
she received from the union. It is from the income tax report, is it?
Mr. Calabrese. This is from the records of local 825.
Mr. Fay. Excuse me.
Mr. Calabrese. In 1951, $7,925. She had an increase in salary.
In 1952, $7,800. In 1953 there was another increase in salary,
$9,100. In 1954, $9,775. In 1955, $9,600. In February of 1956, it
reflected her last salary and she received a total that year of $1,225 ;
making a grand total of $67,800.
Mr. Kennedy. Does that include the pension ? I mean, does that
include the Christmas bonus of $500 ?
Mr. Calabrese. Yes.
Mr. Kennedy. She received a Christmas bonus of $500 at Christ-
mas, starting in 1948 ?
Mr. Calabrese. Yes, in 1948.
Mr. Kennedy. For every year after 1948, is that right ?
Mr. Calabrese. Yes, sir.
Mr. Kennedy. Could you tell us what the value of the automobile
that she received was ?
Mr. Calabrese. $3,722.
Senator McNamara. IVliat is the total figure ?
The Chairman. This record, if you have checked it and it is ac-
curate, and yo\i are prepared to swear to it, may be printed in the
record at this point, that capitulation.
(The document is as follows :)
/. XJ. 0. E. Local 825, breakdown of Anna Fay salary
Period
1947 1
1948
1949
1950
1951
1952
1953
1954
1955
1956
January
$500
500
625
500
625
500
500
625
500
500
625
500
$625
500
500
500
625
500
500
625
500
625
500
500
$625
500
500
500
625
500
625
500
500
500
625
500
2 $725
600
600
750
600
600
750
600
600
750
600
750
$600
600
750
600
600
750
600
600
750
600
600
750
3 $700
700
875
700
700
875
700
875
700
700
875
700
$700
700
875
875
700
700
875
700
700
875
700
f 875
\ «500
$700
700
700
875
700
700
875
700
875
700
700
875
9 500
$700
*525
March
Apri]
May -
June
July
August
$125
500
625
500
500
625
September
December
Total
2,875
5 6,500
6,500
6,500
7,925
7,800
9,100
9,775
9,600
1,225
» First time Anna Fay appears on local 825 payroll at $125 per week.
2 Increase salary to $150 per week, same salary as William Carter and Edward Shinn.
3 Increase in salary to $175 per week.
* Last pay period, Feb. 17. 1956.
» William Carter, recording secretary, $6,600: Edward Shiim, president, $6,500; all the rest below $6,500.
* Bonus.
Source: Payroll records and W-2 forms.
IMPROPER ACTIVITIES IK THE LABOR FIELD 8105
(Information given to the committee by Mr. Edward Mayer, accountant in
office of local 825, to the effect, Joseph S. Fay before his confinement to prison
was receiving $125 per week as a salary. It may be possible that the salary
paid to Mrs. Anna Fay was a continuation of Joseph S. Fay's salary since she
did nothing for it.^)
Senator ]\IcNamara. What was the total figure ?
Mr. Calabrese. $67,800.
Mr. Kennedy. That is without the automobile.
Senator McNamara. $70,000 in round figures over a 10-year period,
including the automobile ?
Mr. Calabrese. Yes, sir.
Mr. Kennedy. What connnission do you receive on the automobiles
that you sell now ?
Mr. Fay. Five percent on the net.
Mr. Kennedy. Have you had any other business dealings with the
union directly or indirectly since 1956 ?
Mr. Fay. The only thing, and after the right to do so by the parole
authorities, I held 331/3 percent stock in the building that the union
was living in. I rented that. I sold that. There were three stock-
holders.
Mr. Kennedy. Who were the other stockholders with you? You
sold it to the union ?
Mr. Fay. There were nine children, and the estate of Edward Shinn.
INIr. Kennedy. Who was Edward Shinn ?
Mr. Fay. He was the president of local 825, and he died in 1952.
Waher Moczarski, the man that run the restaurant or tavern on the
first floor of the builcling.
Mr. Kennedy. Is he related to any union official ?
Mr. Fay. He is a brother of Peter Weber.
Mr. Kennedy. What position does Peter Weber have with the
union ?
Mr. Fay. He is a business agent, or a business manager, I think.
Mr. Kennedy. He is the business manager of the local ?
Mr. Fay. I guess he is business manager.
Mr. Kennedy. I believe he is business manager of the local.
Mr. Fay. Yes, sir.
~Mr. Kennedy. So this group, you sold this property and the build-
ing to tlie local, local 825 ?
Mr. Fay. Yes, sir, at the suggestion of the parole authorities that I
dispense with the holdings of that property.
Mr. Kennedy. Did you actually sell the corporation in which you
three had an interest, the estate of Shinn, Moczarski, and yourself?
Mr. Fay. We sold the stock, yes, sir.
Mr. Kennedy. In the corporation, and this corporation's sole
possession was this property ?
Mr. Fay. Yes, sir.
Mr. Kennedy. And the building on it ?
Mr. Fay. Yes, sir.
Mr. Kennedy. How much did you sell that for to the union ?
Mr. Fay. $75,000 net.
Mr. Kennedy. And how did you arrive at the figure of $75,000 as a
proper figure?
Information from Eugene M. Reatdon, Sr., presiilent of local 825
8106 IMPROPER ACTIVITIES IN THE Ll\BOR FIELD
Mr, Fay. After the appraiser had appraised it for the union, and
for ourselves, the stockhoklers, the price was arrived at $T5,000.
Mr. Kennedy. Had the appraisers appraised it at approximately
$75,000?
Mr. Fay. Yes, sir ; jf little more than that.
Mv. Kennedy. About $77,000.
Mr. Fay. Somethinj;- like that.
Mv. Kennedy. About $77,000?
Mr. Fay. Yes, sir.
Mr. Kennedy. So you sold it for about $75,000 ?
Mr. Fay. Yes, sir.
Mr. Kennedy. Did you say that was net? Did the union have to
assume any liabilities?
Mr. Fay. The union accepted the stocks and the liabilities and
assets of the 2-4-G Corporation.
Mr. Kennedy. How did they balance out the liabilities and assets;
do you know ?
Mr. Fay. I don't know exactly. Your committee has a complete
breakdown of it.
^Ir. Kennedy. I think it is better for us to get it from you.
Mv. Fay. You know, Mv. Kennedy, this is more than 30 years.
jSlr. Kennedy. I would rather get it from you, and if you do not
have it wo will put it in and you can correct it if it is not correct.
Do you have those fio-m-es on the property ? Could you run down a
little bit of the backoround of the property, and tell us then what it is?
Mv. Mathews. JNIay I be heard a moment, please? Since I came to
"Washinrrton, may I say that I was in consultation with this coopera-
tive youuij man, and I gave him first some figures, and then because
he wanted an explanation of them I got in touch with Newark, with
the accountants, and I did not represent the corporation at the time,
and I had the breakdown given, and in addition to that I got a third
pai>er for him which I understand, Mr. Cofini, was given to you
yesterday.
So Mr. Cofini has in his possession what I would call exhibit A, the
first paper on a yellow sheet, and the second papers, 3 or 4 sheets on a
blue sheet, and the last paper typewritten, which he had yesterday. I
don't want to interrupt the committee, but I do want you to know,
gentlemen of the connnittee, that I have cooperated to the full as
counsel for j\[r. Fay, to get you all of this information, and I think
Mr. Cortni will bear me out, and Mr. Egan, Jr., has assisted me.
The Ciiair:man. Do you have all of these records ?
All right, you nuiy place them in the record.
^Ir. Kennedy. Would you just give us a summary of the property
and of the situation, and the sale of the property subsequently?
Mr. Cofini. Giving you some of the background of the property,
I would like to state tliat the property was originally purchased in
the years 1926 and 11)27 by Mr. Fay and Mv. Eomp, who it that time
operated the R. & F. Realtv Co. " The cost of the propertv at that
time was approxinuitely $37",000. The $37,000 consisted of $33,000 of
mortgages, which wore issued by the Engineers l^uilding & Loan As-
sociation, and the Engineers Building & Loan Association Avas an
organization of which ^Ir. Fay was also a director.
Mr. Fay. I want to correct that, 1 am not a director.
Mr. Kennedy. You were a diroi'tor?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8107
Mr. CoFiNi. He was a director, and at that time it was in the proc-
ess of loaning money to operating engineers for purposes of buying
homes and so on.
Mr. Fay and Mr. Romp held on to this property until about 1931,
when the Engineers Buikling & Loan Association foreclosed on the
property, and the property at that time was purchased by the 2—4-6
Corp. The 2-4r-Q Corp. purchased it by just assuming the mortgage
outstanding at the time, which amounted to approximately $26,000.
Mr. Kennedy. Who was the 2-4-6 Corp. ^
Mr. CoFiNi. The 2-4-6 Corp. was made up of Mr. Weber, Mr. Fay,
Fred Eomp and Edward Shinn.
Mr. Kennedy. What was Edward Shinn's position at that time ?
Mr. CoFiNi. Edward Shinn's position at that time was secretary,
and Mr. Fay was vice president and treasurer, and Mr. Fred Romp
was president.
Mr. Ivennedy. Mr. Shinn had a position with the local at that
time?
Mr. CoriNi. He had a position with the local, yes, sir.
Mr. Kennedy. He was president of the local ?
Mr. Fay. President of the local.
Mr. Kennedy. And what about Mr. Romp ?
Mr. Fay. He had no connection with the local.
The Chairman. May I ask what it shows with the profits ?
Mr. Kennedy. We are just getting into that.
Mr. CoFiNi. Now, in 1941, tlie city of Newark condemned the build-
ings located on this 2-4-6 property, and the 2-4-6 Corp. then pro-
ceeded to erect a completely new building. The erection of this build-
ing cost the corporation approximately $43,000.
Now, the money to erect this new building was acquired by the
tenants of the 2-4-6 Corp. at the time. The breakdown of the money
they received was $16,000 from local 825, and $16,000 from local 472.
Mr. Kennedy. Of what union ?
Mr. CoFiNi. The Hod Carrier Union. And $2,200 from Walter
Moczarski, the operator of a place on the premises. $6,500 from the
International Excavating Co., and an additional $2,000 from Mr. Fay,
a personal loan from Mr. Fay, and $1,000 personal loan from Mr.
Shinn, and $21,000 which was a dividend that was being paid to Mr.
Fay and Mr. Sliinn from the International Excavating Co.
(At this point, the following members were present : Senators
McClellan, Mundt, and McNamara.)
Mr. Kennedy. Was that a company that you and Mr, Shinn owned?
Mr. Fay. Yes, sir.
Mr. Kennedy. What did the International Excavating Co. do?
Mr. Fay. They done excavating work, road work.
Mr. Kennedy. Road work?
Mr. Fay. Yes, sir.
Mr. Kennedy. They employed operating engineers at tliat time?
Mr. Fay. Yes; they did,
Mr. Kennedy, And you and Mr. Shinn owned that company?
Mr. Fay. Yes, sir.
Mr. CoFiNi. With this money, which totaled about $64,000, the
corporation was able to erect its new building, wliich came to a cost
of $43,000, and also paid off the existing mortgage to tlie Engineers
Building & Loan Association of approximately $16,000. Upon Mr.
8108 IMPROPER ACTIVITIES IN ITHE LiABOR FIELD
Fay's release from prison, the stock of the corporation was sold to the
local 825 at a cost of $75,000.
Mr. Kennedy. There Avas mention made
Mr. Fay. Mr. Chairman, to correct Mr. Cofini, that is trustees that
accepted, the board of trustees accepted, the stock of the corporation,
and not directly in the name of local 825.
Mr. Kennedy. So it went into the name of the trustees. Do you
know who the trustees were?
Mr. Fay. No; I do not, sir.
The Chairman. Were they trustees for the union ?
Mr. Fay. For the union.
The Chairman. Well, that is technical.
Mr. Fay. It is technical, so that the union members wouldn't be
Mr. Kennedy. Who were the trustees?
Mr. CoFiNi. Eugene Reardon, Sr.
Mr. Kennedy. He is the president of the local ?
Mr. Cofini. The president of the local. Peter W. Weber, business
manager. He is the brother of Walter. Moczarski, and Edward A.
Mayer, who is treasurer of the local. They are the trustees, and the
stocks are now held by the trustees for the local.
Mr. Kennedy. You say there was mention about the appraisals
for the property ?
jMr. CoFiNi. The properties were apraised at approximately $77,000.
Mr. Kennedy. This ^roup of Mr. Fay, Moczarski, and the Shinn
estate, the corporation was sold to these trustees for the local?
Mr. CoFiNi. Right.
Mr. Kennedy. And it was sold for $75,000 ?
Mr. CoFiNi. The property was sold for $75,000.
Mr. Kennedy. Were there any assets or liabilities, liabilities that
had to be assumed by the trustees ?
Mr. CoFiNi. Yes; there were liabilities totaling $13,144.59.
Mr. Kennedy. So what would that make the total cost to the miion
for the property ?
Mr. CoFiNi. $88,144.96.
Mr. Kennedy. Are those figures correct ?
Mr. Fay. Well, they are not correct as far as the actual happening
of the entire matter. The question of the assets and the limits came
up, and their was some $5,000 that was in question between the two
tenants, the tenant on the first floor and the tenant on the second floor
of the electricity and the heat that was supplied by the tenant on the
first floor. That amounted to four or five thousand dollars. They
accepted it and said that they would get together with them and
straighten the matter out.
Mr. Kennedy. The liabilities, nevertheless, as I understand, still
were some $13,000.
Mr. Fay. But it didn't come directly from the 2^-6 Corp.
Mr. Kennedy. The liabilities on the books of the 2-4-6 Corp. was
for $13,000. How was that split between the tenant on the first floor
and the tenant on the second floor ?
Mr. Fay. Accounts receivable for the union. They owed that
money.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8109
Mr. Kennedy. In addition to that
Mr. Fay. Mr. Kennedy, I have made a study of this. This is more
than 30 years. Would you let Mr. Egan, one of my attorneys who
has been on this for the last 2 weeks, give yon a clear-cut picture of
my position in this?
The Chairman. Mr. Fay, do you have there a prepared statement
or figures as to the transaction ?
]\Ir. Fay. I only have tlie same figures that Mr. Cofini has read,
with the exception of m}^ investment over these years, what I had
invested as a one-third stockliolder of that 2-4-6 Corporation. It was
$27,500. The cost of the building and the investment from 1926 to
when we sold the building on January 31, 1957, the cost of that build-
ing on the books is $90,815. We went over it. We didn't lose any of
the records. Certified public accountants, ]Mr. Kennedy, made this
up. I never, over these more than 30 years, did I receive any salary
but $1,000 in 1912.
(At this point. Senator Mundt left the hearing room.)
The Chairman. Let me understand. The paper you have in your
hand, Mr, Fay, is a copy of what you supplied the committee, giving an
accurate account of the investment, the sale, and obligations assumed,
is that correct ?
Mr. Fay. Yes, sir; but he didn't read that.
(At this point, Senator Ervin entered the hearing room.)
The Chairman. This statement that you have, if you testify to it
that it is a correct and accurate statement
Mr, Fay. From the certified public accountant.
The Chairman. From your certified public accountant, that state-
ment that you have there may be made a part of the record at this point.
It is a part of the record, and you will be asked questions and can give
explanations about it.
(The document referred to follows:)
2-4-6 Fleming Avenue, Nexvarli, N. J.
1926 : Purchase price, No. 6 $9, 500
1927 : Purchase price, Nos. 2 and 4 27, 500
37,000
Less morgtages :
Engineers' Building & Loan Association 8, 000
Do 10, 000
Do 10, 000
Emma Bitz 5, 000
Total 33,000
Cash payments at purchase— 4, 000
February, March, and April 1931 : Mortgages foreclosed.
July 1931 : 2-4-6 Fleming iVvenue was incorporated and three tracts were
purchased from Engineers' Building & Loan Association for the total amounts
due on them for unpaid principal, interest, taxes, foreclosure costs, and 2-4-6
Fleming Avenue gave the following listed mortgaged to Engineers' Building &
Loan Association : July 31, 1931, $9,400, $9,400, $7,200.
21243— 58— pt. 2(
8110 IMPROPER ACTIVITIES IN THE LABOR FIELD
Cost of new building erected, 1941
Cost of original property supported by 1st mortgage to Engineers'
Building & Loan Association $25, 740. 45
Cost of construction of new building :
Material and plumbing 31, 953. 09
Labor, social security, and insurance 10, 165. 78
Architect's fee 1, 000. 00
Total 69, 859. 32
Subsequent improvements :
May 11, 1942, painting 245.00
August 21, 1942, fence 250. 00
November 27, 1942, electric fixtures 253. 15
March 14, 1948, air conditioning 5, 275. 00
September 10, 1953, oil burner 936.38
March 21, 1955, office remodeling 4,000.00
Total 10, 959. 53
Total cost of building 79, 818. 85
Mortgage oaymeuts made by R. & F. Realty Co. from 1927 to 1931___ 7, 000. 00
Cash payment made by R. & F. Realty Co. in 1927 4, 000. 00
Total investment from 1926-227 to 1957 90, 815. 85
1957 : About January 31, 1957, the 11 existing shareholders, that is, Messrs.
Fay Moczarski, and the 9 heirs of Edward Shiun, sold their entire holdings to
a group of trustees for local 825 for the sum of $75,000, the trustees taking com-
plete ownership of all assets, including the land, building, current cash balance,
accounts receivable, etc., and assuming outstanding liabilities for the corpora-
tion.
Mr. Matthews. Would you like a copy of it, Senator?
The Chairman. I thought we had one.
Mr. Matthews. This is an extra copy.
Mr. Kennedy. Were there also improvements made by the union
to the building^
Mr. CoFiNi. Yes, sir ; improvements made by both the 2-4^6 Corp.
and the union.
Mr. Kennedy. How much were the improvements by the union?
Mr. CoFiNi. Approximately $11,000.
Mr. Kennedy. When the appraisal was made, was that made of the
building with the improvements?
Mr. CoFiNi. With the improvements.
Mr. Kennedy. So, the appraisals that were made were of the prop-
erty, the building the improvements that had been made by the 2-4—6
Corp., and by the union, and the appraisal value was some $77,000?
Mr. CoFiNi. That is correct.
Mr. Kennedy. And that would include some $11,000 of improve-
ments made by the union, and, in addition to that, the union had
assumed some $13,000 in liabilities ; is that right ?
yiv. CoFTNi. That is right.
Mr. Fay. Mr. Kennedy, the statement that you have just put into
the record now is not the fact.
Mr. Kennedy. Mr. Fay, I asked you, first, to—
Mr. Fay. Mr. Cotini found that this improvement to the building
was negotiated with the tenant and the owner, and half of that was
paid by *^he tenant and half by the owner.
Mr. Kennedy. How much did the tenant pay?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8111
Mr. Fay. I believe that the amount was, as near as I can find out,
about $10,000, and they both paid half of it. That is right. That is
the truth.
Mr. Kennedy. Fine. We want to get the record straightened out.
Mr. Fay. Fine.
Mr. Kennedy. How much did the union pay for the improvements
in the building ?
Mr.CoFiNi. $11,000.
Mr. Kennedy. The union paid it?
Mr. CoFiNi. The union paid $11,000.
Mr. Kennedy. Were they reimbursed for half of that ?
Mr. CoFiNi. Not to my knowledge ; they were not.
Mr. Kennedy. Were they reimbursed, Mr. Fay ?
Mr. Fay. They were reimbursed, according to the auditor, and I
believe that the union officials will so testify.
Mr. Kennedy. The records of the union show that they paid some
$11,000.
Mr. Fay. If they wanted to make $20,000 worth of improvements,
the owner would not object to it.
iNIr. Kennedy. No, I agree on that. But when the appraisal was
ultimately made of the property at some $77,000, it included these
improvements. I am just ]iointing that out. The union paid for the
propertv some $75,000 and had to assume on top of all of this the lia-
bilities of approximately $10,000 to $13,000.
Mr. Fay. Mr. Kennedy, if I may, I would say to you that if you
knew and saw the building before it was sold, I could have — we, the
stockholders, could have sold that for much more than $75,000. But
the tenants were there, and it was a quick deal. I felt that we should
not sell that building from under the union, and it was the miion's
price. It was the estimated price of two competent and capable
appraisers.
Theref ore,.there was nothing that was, in my opinion, wrong with it.
Mr. Kennedy. No 1, the appraisal was right, but everything should
have added up to about $77,000, and not some $88,000. When you say
that it was the union's price, the business manager of the union is Peter
Weber and his brother was one of those who sold the corporation, who
had an interest in the corporation and sold it to the union.
Again, these facts will speak for. themselves, ^Ir. Fay. I am just
putting them into the record.
Mr. Fay. Mr. Kennedy, I wish that, on account of the extensive
search of this matter that we made, if Mr. Egan could explain some
of the points in here that are over my head that I have not had the time
to go into it.
Mr. Kennedy. I do not think we want to go into a discussion about
the mortgages.
Mr. John J. Egan. Mr. Chairman, may I be heard ?
The Chairman. Do you want to be sworn and testify ?
Mr. John J. Egan. Yes, sir.
The Chairman. You do solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. John J. Egan. I do.
8112 IMPROPER ACTIVITIES IN THE LiABOR FIELD
TESTIMONY OF JOHN J. EGAN
The Chairman. I believe you have ah-eacly stated for the record that
you are cocounsel for Mr. Fay.
Mr. John J. Egan. Yes, sir.
The Chairman. All right. There is a statement here before us that
the Chair has ordered printed in the record regarding this transaction.
Mr. Fay thinks you can give some information about it that he could
not give. You may proceed.
Mr. John J. Egan. Yes, sir. I think I can shed some light on it.
The information that is in the exhibit that is to be printed in the rec-
ord has been supplied by us, and we feel that the figures are accurate.
The first day of this hearing the Chair stated that the current hearings
will be aimed at developing information in a number of areas.
No. 1 was to find out if there was any illegal conversion of union
funds to the financial advancement of certain top officers of the union.
1 think that would apply to this transaction. I think this committee
is interested in finding out if there was a conversion or gain by Mr.
Fay or other officials of the union.
I would like to give some background and say that when this prop-
erty was sold, approximately 1 year ago, it was a private transaction,
between the 2^—6 Corp., of which Mr. Fay was a stockholder. It was
sold to local No. 825. That itself is a private transaction and perfectly
proper. If the union membership approved of this purchase, it was
proper. The records will show that there have been discussions of this
transaction on the floor of local 825 by the membership, through
their officers. And an amendment was passed to purchase this prop-
erty. This property was purchased for approximately $75,000, and the
union agreed to assume the liabilities. These liabilities, some of them,
were accounts receivable owed to the corporation by the union.
From 1926, when the E. & F. Corp., which is Mr. Fay and Mr. Romp,
purchased this property, there was an old building on tjie property.
They paid $37,000 at that time.
They put up $4,000 cash. There was $33,000 in mortgages, $28,00C>
total from the Engineers' Building and Loan Association and $5,000
from the original owner of the property, one Emma Betz.
Starting in those years, up until the time the property was sold,
Mr. Fay and his other stockholders invested a total of $90,815.85. So
at the end of this period, from 1926 until 1957, approximately 30
years, they invested $90,000 and sold it for less than $90,000.
The Chairman. Thev sold it for about $88,000, in round numbers.
Mr. John J. Egan. Approximately $88,000. I think that is what
the committee is interested in, to find out how much money Mr. Fay
as an individual and the other shareholders invested. That figure is
$90,000. They sold this property to the union for some $75,000, plus
the liabilities. So it was less than $90,000. One the entire transaction,
they took a net loss.
This does not compare to other real estate deals tliat have been dis-
cussed by this committee from other locals.
(At this point. Senator Kennedy entered tlie hearing room.)
IMPROPER ACTIVITIES IN THE LABOR FIE'LD 8113
Mr. John J. Egan. This deal sliows that the shareholders lost
money on the entire transaction. Further, over the entire oO-year
period, Mr. Fay, as a stockliolder, received, in 1942, $1,000. That is all
he made from the property. I understand when he sold the property
in 1956 he received another $900. That was 1957. In other words,
he made in 30 years out of this whole transaction or real estate in-
vestment, $1,900.
When he sold the property' to the union, the corporation lost money.
So we say there wasn't any illegal conversion of union funds to Mr.
Fay or other union officials. It was a private transaction. It was sub-
mitted to the local and, by membership, in a democratic way, at a local
meeting where over 1,000 members attended, they considered this pro-
posal. It was purchased. Mr. Fay sold this property, the 2-4-6
Corp. to local 825, at the request of the parole authorities. They felt
if he was the landlord of the building where the local was the tenant,
he could be connected directly or indirectly with union activities. So
he sold that not at their suggestion but at their request. He thought he
should sell it to the union. I tliink that is a hodge-podge of hgures.
The fact is they invested approximately $90,000 in the 30-year period.
They sold it for less than $90,000. So there wasn't any profit made.
The Chaikman. All right.
Your statement may be absolutely accurate. I am not challenging
it. We are just looking into it. We have had many instances of
frauds being perpetrated upon unions by collusion between officers
and unions and others.
Mr. John J. Egan. Yes, sir ; we are aware of that. I attended the
hearings all last week.
The Chairman. This is one of those transactions that appears here
in the course of this investigation. I am not ready to pass judgment
on this now.
Mr. John J. Egan. I feel the committee should have a full picture
and know that it is a proper transaction.
The Chairman. We are simply trying to get the facts.
Mr. John J. Egan. Yes, sir.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. If the property is worth $75,000 and is sold for $88,-
000, that is wiiat we are interested in. The fact that maybe Mr. Fay
made a bad investment initially and was losing money during this
period of time, and the investment ultimately had been $80,000 and
they were only able to sell it for $88,000, is not really the point. The
point is that the value of the property as appraised was at the most
$77,000, and ultimately was sold for $88,000.
I believe that is about it, Mr. Chairman.
The Chairman. Is there anything further on this? Senator Mc-
Namara.
Senator McNamara. Does our staff have a legal description of this
property ?
Mr. CoFiNi. I have it.
Senator McNamara. Can you tell us what it consists of ?
8114 IMPROPER ACrrVITIEiS IN THE liABOR FIE1,D
Mr. CoFiNi. The property consists of three separate tracts of land,
in a section of Newark, N. J. called Fleming Avenue; one parcel is
called No. 2, the other No. 4, and the other No, 6. That is how the
property got to be known as 2-4-6 Fleming Avenue.
The Chairman. Are these legal descriptions ?
Mr. CoFiNi. Yes, sir.
Senator McNamara. Do they have a street address ?
Mr. CoFiNi. 2-4-6 Fleming Avenue.
Senator McNamara. They all have the same number?
Mr. CoFiNi. These parcels of land have different numbers. They
are three parcels of land, 2-4-6 Fleming Avenue.
The Chairman. As I understand, you have a block here, and you
have lots, lots 1, 2, 3, 4, 5, and 6. This parcel of land consisted of
parcels 2, 4, and 6, and the number at that street number is 2-4—6, and
the corporation v/as set up as 2-4-6. So your legal description is lot
or plat, whatever it is, 2, 4, and 6, and the three legal descriptions make
up the whole tract of land.
Mr. CoFiNi. Yes.
Senator McNamara. Mr. Chairman, do you think that legal descrip-
tion should be made a part of the record ?
The Chairman. Well, he just testified to it.
Do you want to have the document in ?
Senator McNamara. Yes, sir.
The Chairman. Those documents may be printed in the record.
(At this point, the following were present: Senators McClellan,
McNamara, Ervin, and Kennedy.)
IMPROPER ACTIVITIES LN" THE LABOR FIELD
(The documents referred to follow :)
8115
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- '|r -a^ X..J. 5.
8116 IMPROPER ACTIVITIES IX THE LABOR FIELD
The Chairman. Is there anything further? Are there any other
questions ?
All right, thank you, Mr, Fay. You may stand aside.
Call the next witness.
Mr. Kennedy. Mr. Weber.
The Chairman. Mr. Fay, you may want to remain, and there may
be some other points that you may be interested in.
Mr. Hayden. May I address the Chair, please ?
The Chairman. Just a moment.
Mr. Hayden. I am Joseph A. Hayden, a member of the bar of the
State of New Jersey, with offices at 11 Commerce Street in Newark,
N. J. I desire to address the Chair.
The Chairman. Just one moment, please. Let me get the witness.
Mr. Hayden. My request is to address the Chair before he is
sworn, and it has to do with the condition of his eyes and the lights.
The Chairman. Do you represent the witness?
Mr. Hayden. Yes, sir ; I do.
Tlie Chairman. The Chair will depart from the usual course.
Mr. Hayden. I have, sir, and there has already been forwarded to
Mr. Kennedy as the counsel to the committee, a letter from the
opthalmologist who is treating Mr. Weber's eye. I would like that
the committee hear it because it will necessitate and be the support for
my request that all of the lights be put out except the room lights.
The Chairman. Make jour statement.
Mr. Hayden. This is a letter dated January 17, 1958, and it is ad-
dressed to Mr. Robert F. Kennedy, chief counsel. Senate Select Com-
mittee on Improper Activities in Labor or Management, Senate Office
Building, Washington, D. C.
Dear Sir : On January 11, 1958, I wrote a letter regarding Mr. Weber to the
Senate Committee on Labor and Management, addressed to New York. He has
a severe inflammation of the interior of the eye, namely iridocyclitis. This has
nearly blinded the eye and disabled Mr. Weber. I have requested that he re-
main at home so that he can administer treatment outlined by me, consisting of
various drops, compresses, and tablets to be administered every hour or two.
He is taking full dosage of cohydeltra (hydrocortisone) by mouth as well as
10 percent neosynepherine, 4 percent atropine, polymixon ointment, and hydro-
cortisone drops locally.
His condition has not improved since my last letter. I have advised hos-
pitalization for more adequate treatment and observation, Mr. Weber feels re-
luctant to go. I have requested him to restrict all activities except for his daily
office visits to me, with the exception of telephone calls. He is also taking
thorozine by mouth.
The treatment does affect his thinking (cerebration of thinking) and memory.
Any further information on Mr. Weber's condition I can supply I will be
glad to do so.
On Tuesday, Mr. Chairman, just before we boarded the plane to
come down, Mr. Weber had his last visit to his files. On his know-
ing the matter he was about to go on, he was specificallj^ requested
to request the chairman of the committee not to allow any undue
lights, or particularly any flashbulbs, as they might tend to aggra-
vate the condition.
I respectfully make that request.
The Chairisian. Do you solennily swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Weber. I do.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8117
TESTIMONY OF PETER W. WEBEH, ACCOMPANIED BY HIS COUNSEL,
JOSEPH A. HAYDEN
The CiiAiRMAx. Gentlemen, photographers, there will be no lights
and no flashbulbs, and the witness, apparently, from his statement,
will testify under some handicap, and we will give him every courtesy
to enable him to give his testimony for the benefit of the committee,
and every consideration for his reasonable convenience and comfort
will be observed.
Mr. Weber, state your name, your place of residence, and your busi-
ness or occupation.
Mr. Weber. Peter W. Weber, .549 Park Street, Montclair, N. J.
I am business manager of the Operating Engineers, Local Union
825-A, B, C, and D. Also a vice president of the Building Trades
of the State of New Jersey. Also president of the Board of Agents
in the County of Essex, Newark, N. J.
The Chairman. Now, Counsel, I don't know whether we got your
full name or not. Will you, for the record, state your name now?
]Mr. Haydex. Joseph A. Hayden, a member of the bar of the State
of New Jersey, with offices at 11 Commerce Street, Newark, N. J.,
residing at 352 Richmond Avenue, South Orange.
The Chairmax. Thank you very much.
All right, Mr. Kennedy, you may proceed.
Mr. Kexnedy. How many members of local 825 are there ?
Mr. Weber. I think we have a record of that, and I would like to
read it off the record.
(The witness conferred with his counsel.)
Mr. Kexxedy. Do you want to get the exact figures ?
jMr. Weber. Yes.
Mr. Kexxedy. An approximation will do.
Mr. Weber. Around 7,900.
Mr. Kexxedy. How are they split up between the A and B ?
Mr. Weber. Different branches, 825 and 825-B.
Mr. Kexxedy. How many are in each one ?
Mr. Weber. I wouldn't have the record.
Mr. Kexxedy. You don't even have an approximation of how many
you have in each one ?
Mr. Weber. It could be in the neighborhood of 1,800 in 825 and
around 1,700 in 825-A and around^2,000 in 825-B and probably about
2,000 in 82.5-C.
Mr. Kexxedy. Is it only the parent group, the 1,800 that are allowed
to vote for the officers ?
Mr. Weber. Every member in our union, from the time that I can
remember, and being a member there for 30 years, is allowed to vote
when they are at a meeting.
Mr. Kexxedy. IMiat about for union officials ?
Mr. Weber. At anything, on any issue.
Mr. Kexxedy. All union officers?
Mr. Weber. Yes.
Mr. Kexxedy. I thought it was against the constitution.
Mr. Weber. Well, I know it is, but we never denied anyone a vote
on the floor at any time that I can remember attending any meeting.
Mr. Kexxedy. So all 7,000 members of the union can vote even
8118 IMPROPER ACTIVITIE.S IX THE LABOR FIELD
though it is a violation of the constitution, 5,000 of them vote in viola-
tion of the constitution ?
Mr. Weber. We have never considered a violation of any constitu-
tion giving a man a right and privilege to discuss any issue concerning
him or the functions of the local union.
Mr. Kennedy. But we have had testimony before the committee that
the reason the members of A and B — we have been speaking about the
DeKoning local — the reasons the members of A and B have not been
allowed to vote in the elections for their officials is because it is against
the constitution.
Now is it against the constitution, and can these people vote or can
they not ?
Mr. Weber. I can only speak for local 825, and its branches, Mr.
Kennedy, and our members are allowed to vote.
Mr. Kennedy. Do you know what the constitution says about that
and what provision they have on it?
Mr. Weber. No.
Mr. Kennedy. You do not ?
Mr. Weber. I do. It is on the record, and we have it.
Mr. Kennedy. Do you allow them to vote in violation of the con-
stitution ? I am in favor of having them vote, but I am trying to find
out whether you are acting in violation of the constitution.
Mr. Weber. We are not. When you give man the right to do some-
thing he is entitled to, it is no violation, and we have never been charged
with it.
Mr. Kennedy. Do you know if the constitution has a provision that
only those in the parent organization can vote in an election ?
Mr. Weber. I think the interpretation of the constitution is well
phrased. It is up to the president in the chair that he can use his own
discretion whether to allow a man to vote or not, or to talk on any
issue or not. We have never had that problem.
Mr. Kennedy. What section of the constitution are you referring to ?
Mr. Weber. I can't read it, but I guess my counsel can. It is the
duties of the president.
Mr. Kennedy, This is the international constitution.
Mr. Hayden. It is the International Union of Operating Engineers
Constitution.
Mr. Kennedy. Mr. Weber, perhaps they can look it up. How long
have you been a member of the Operating Engineers ?
Mr. Weber. Sometime in September of 1928 ; previous to that I was
with the Steam Shovel and Dregmen.
Mr. Kennedy. And you became a member of local 825 ; is that right?
Mr. Weber. That is right.
Mr. Kennedy. Did your other union merge with local 825 ?
Mr. Weber. Yes, sir ; sometime in 1928.
Mr. Kennedy. And when did you first become an official of the
union ?
Mr. Weber. Not an official. I was an organizer in 1934.
Mr. Kennedy. And then you became a business representative in
1936; did you?
Mr. Weber. Around that time.
Mr. Kennedy. And subsequently, were you made an assistant to
Joe Fay ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8119
Mr. Weber. I think in 1940 or 1941, by our general president, Pur-
cell.
Mr. Kennedy. Wliat position did you assume at that time ?
Mr. Weber. Carrying on the duties of helping local unions nego-
tiate contracts, or attending meetings.
Mr. Kennedy. As an assistant to Joe Fay ?
Mr. Weber. Yes, sir.
Mr. Kennedy. Did you go down into this Philadelphia local ?
Mr. Weber. I have been there several times, but I have not been
there from the inception ; I just attended the meetings.
Mr. Kennedy. You attended a number of meetings ?
Mr. Weber. Maybe lor 2.
Mr. Kennedy. Did you go down with Joe Fay ?
Mr. Weber. No, I have met him there.
Mr. Kennedy. And were you down there during the 1940's, also,
when it was under trusteeship ?
Mr. Weber. I wouldn't be able to say correctly.
Mr. Kennedy. You do not know ?
Mr. Weber. No ; I do not.
Mr. Kennedy. When you were going down there, was that when
Joe Fay was in charge of the local? That is what I am trying to
find out. Were you down there after he gave up the position of
trustee ?
Mr. Weber. I was not at any meetings after that.
Mr. Kennedy. You were not ?
Mr. Weber. No; I think it was between I guess 1944 and 1947.
Mr. Kennedy. Have you been down since it was placed in trustee-
ship in 1952?
Mr. Weber. No, sir.
Mr. I^nnedy. You have not been there ?
Mr. Weber. I never have been there, or at any meetings.
Mr. Kennedy. You never have had anything to do with it ?
Mr. Weber. No, sir.
Mr. Kennedy. You have had trouble vdth your eye, Mr. Weber ?
Mr, Weber. Yes, sir ; I have.
Mr. Kennedy. When did you start having trouble with your eye, and
what was that due to ?
Mr. Weber. Since 1947.
Mr. Kennedy. Was that due to any work that you were doing for
the union ?
Mr. Weber. Yes, sir ; it was.
Mr. Kennedy. In connection with what ?
Mr. Weber. I was representing the local union on the job, in the
Philipsburg area. New Jersey Light & Power. They were doing the
job.
Mr. Kennedy. That was a dispute with the United Mine Workers,
was it ?
Mr. Weber. Yes, sir.
Mr. Kennedy. District 50.
Mr. Weber. Yes, sir, and I had my eye busted open.
Mr. Kennedy. Now, you became business manager of local 825, in
August of 1953?
Mr. Weber. That is correct.
8120 IMPROPER ACXrV'ITIEiS IN THE liABOR FIEI.D
I
Mr. Kennedy. Were you elected to that position ?
Mr. Weber. For the 4 months, expired term I was appointed by the
resident, with the authority of officers of the local union, and approved
y the members of the local union at the next regular meeting.
Mr. Kennedy. And subsequently you were elected ?
Mr. Weber. Unanimously.
Mr. Kennedy. Unanimously elected ?
Mr. Weber. Yes, sir.
Mr. Kennedy. No opposition ?
Mr. Weber. No, sir.
Mr. Kennedy. Has there been an election in 1953? Is that when
you were elected after you were appointed ?
Mr. Weber. I think the following year, I think in June or July, I
was elected. I was nominated in January, and the following June or
July meeting I think — it is on the record — that I was elected.
Mr. Kennedy. iVnd have you been reelected since that time?
Mr. Weber. I haven't come up. My office runs for 4 years.
Mr. Kennedy. When do you come up again, Mr. Weber ?
Mr. Weber. Next year.
Mr. Kennedy. From 1953 weren't you reelected in 1957 ?
Mr. Kennedy. No.
Mr. Kennedy. I thought you said you took over in 1953.
Mr. Weber. That's right.
Mr. Kennedy. And your office runs for 4 years ?
Mr. Weber. That's right.
Mr. Kennedy. I would think you would have another election in
1957.
Mr. Weber. I don't think so. It is 1958 or 1959, 4 years after I
was elected, and I can't refresh my memory to the exact time. I know
I was elected for 4 years.
Mr. Kennedy. And you weren't elected in 1957 again ?
Mr. 'Weber. No ; we had no election.
Mr. Kennedy. You were elected in 1953 for 4 years, and the next
election is 1959 ?
Mr. Weber. In 1954 1 think I was elected.
Mr. Kennedy. I thought you said 1953.
Mr. Weber. No ; I said the next year.
Mr. Kennedy. The following year ?
Mr. Weber. Yes, sir.
Mr. Kennedy. So you have an election this year, then ?
Mr. Weber. No ; next year.
Mr. Kennedy. You know better than I do, and I am trying to
find out.
Mr. Weber. I can't refresh my memory to the accounting of it,
but I knoM that there is to be an election next year.
Mr. Kexnedy. What salary do you receive as business manager?
Mr. Wep.er. $14,500.
Mr. Kennedy. And do you receive any expenses on top of that ?
Mr. Weber. $25 a day.
Mr. Kennedy. A flat rate of $25 a day ?
Mr. Weber. That's right.
IVIr. Kennedy. You don't have to submit any vouchers for that ?
Mr. Weber. No ; it is a matter of action by the members.
Mr. Kennedy. And is that for 5 days a week ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8121
Mr. Weber. Seven days a week, 24 hours a day.
Mr. Kennedy. You get expenses for Saturday and Sunday ?
Mr. Weber. Yes, sir, I do ; because I have meetings and I talk to
stewards on Saturday and Sunday.
Mr. Kennedy. Do you submit any vouchers to show what you use
those expenses for ?
Mr. Weber. It is a matter of discretion ; normal taxicabs, and tele-
phones, and lunches, and refreshments, and tips.
Mr. Kennedy. Do you submit any vouchers on it ?
Mr. Weber. No; I' don't have to, because it was a matter of record
what my expenditures were, and I presented it to the executive board
and it was presented to the members.
Mr. Kennedy. You declare it on your income tax ?
Mr. Weber. Yes, I do.
Mr. Kennedy. You declare your expenses ?
Mr. Weber. Yes, I do. My income taxes are being probed now.
Mr. Kennedy. What is that?
Mr. Weber. My income taxes are being probed now.
Mr. Kennedy. Did you ever declare this $25 that you got per day
in addition to your salary ? Did you ever declare that on your income
tax?
Mr. Weber. Up to this year.
Mr. Kennedy. Have you declared it ?
Mr. Weber. No.
Mr. Kennedy. You never did declare it ?
Mr. Weber. Yes, I did, this year.
Mr. Kennedy. Well, starting this year, but you haven't declared
it prior to that time ?
Mr. Weber. It was current expenses.
Mr. Kennedy. What is that ?
Mr. Weber. They were current expenses. They were operating ex-
penses.
Mr. Kennedy. But did you ever have any vouchers to show how you
spent this money, or that you spent $25 a day ?
Mr. Weber. Practically everything I do day in and day out is the
normal operation.
Mr. Kennedy. I am sure of that, that you spend a lot of time with
the union, and I am trying to find out whether (1) you had any
vouchers for the receipt of the $25 a day, and (2) whether you ever
declared any money on your income tax.
Mr. Weber. No,'because I have never kept any of it.
Mr. Kennedy. What do the income-tax returns show ?
Mr. Calabrese. His 1954 income-tax return indicates he is declar-
ing $8,950 as total wages, and incidentally that was his salary, and
that is exclusive of his expenses.
Mr. Kennedy. What year was that ?
Mr. Calabrese. This is for 1954.
Mr. Kennedy. He didn't declare any expenses that year.
Mr. Calabrese. No. So in 1955, he reported $9,700 in w;)ges, and
he reported $1,000 which he received from the International Union of
Operating Engineers in Washington, D. C, and apparently that was
an advance or something.
Mr. Kennedy. Any expenses?
8122 IMPROPER ACTIVITIES IN THE LABOR FIEI.D
Mr. Calabrese. No expenses.
Mr. Kennedy. What about the following years?
Mr. Calabrese. In 1956, he reported $14,600 in wages.
Mr. Kennedy. Any expenses ?
Mr. Calabrese. No expenses.
Mr. Kennedy. What do the records of 825 show that he received in
1956 ? That is, in addition to the salary.
Senator Ivennedy. On this question of voting, while they are get-
ting this figure, this A, B, and C, is that the way they are divided?
Mr. Weber. I beg your pardon ?
Senator Kennedy. In your local union, for which you are business
manager, how are they divided ?
Mr. Weber. Local 825, heavy equipment, and local 825, road work
and miscellaneous work, and local 825, the mechanical maintenance
men, and local 825, dredgemen, operating dredges and working in
construction with waterwork.
Senator Kennedy. Are any of those your apprentice subdivisions ?
Mr. Weber. 825-A.
Senator Kennedy. Now, is 825-A permitted to vote ?
Mr. Weber. Any member at a meeting is allowed to vote.
Senator Kennedy. On any subject ?
Mr. Weber. Any subject at all.
Senator Kennedy. Now, in the constitution, article 14, section 5,
talking about apprentice engineers and sundry divisions —
shall be accountable and function under their local union and they shall respond
to and be under the control of and governed by the said parent union —
and then it says —
provided however, that the members of the said union are apprentice engineers
subdivision and branch engineers subdivision, if in good standing as required
by the international union accredited with per capita tax paid may vote upon
such referendum as shall be submitted to the parent local union for them by
the international union. They shall be entitled to such participation in the
death benefit fund as may be provided for them by the international union.
Said members shall be without vote in the parent local union, save and except
upon such matters as the parent local union may consent to, provided, however,
that they may not vote even should such consent be granted, in any election
of the officers of the parent local union nor shall they hold office in their parent
local union, nor shall they elect officers in their subdivisions.
So when you permit them to vote on any subject, it seems to me
that you are in defiance of the constitution.
Mr. Hayden. May I respectfully ask the page that you are quoting
from ?
Senator Kennedy. Page 39.
Mr. Weber. If it has been a violation, that has been the function of
the union, ever since I have been in it, and there was never anyone
asked whether he was what member or whether he was in good stand-
ing, and he always had a right to get up and discuss whatever he
thought was important to him.
Senator Kennedy. Is this the first time that you have heard of
this section ?
Mr. Weber. I have read it many times.
Senator Kennedy. When counsel asked you, why didn't you say,
"Yes, they do. It is in violation of the constitution, but it is the
custom in our union to do it."
Mr. Weber. I didn't know how to explain it. Senator. I probably
don't know the words to properly express before you at this time.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8123
But I know that wlien a man has a problem he certainly wants to be
heard, and we always eive him that right.
Senator Kennedy, lie has a right to vote ?
Mr. Weber. He has a right to vote.
TESTIMONY OF EGBERT J. COFINI AND ALPHONSE CALABEESE—
Eesiimed
Mr. CoriNi. For the year 1956, Mr. Weber received from local
825 a salary of $14,C00j and received an expense allowance of $9,375,
and expenses for attending conventions of $7,375.
Mr. Kennedy. Would that show in that year out of how many
of the 365 days that Mr. Weber received expenses ? Have you figured
that out ?
Mr. CoFiNi. It would be approximately every day.
Mr. Kennedy. Isn't there 365 days ?
Mr. Calabrese. That would be 375 days.
Mr. Kennedy. Do you have the figures for any other year ?
Mr. CoFiNi. I have the figures for 1955. He received a salary of
$9,700, and expense allowance of $8,475, and convention expenses of
$4,800.
Mr. Kennedy. Did we see going through the books and records of
the local that there were any vouchers to support any of these expenses ?
Mr. CoriNi. No, we have not found any vouchers to support it.
Mr. Kennedy. It is just a flat rate that he gets $25 a day ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. And none of that, according to the income tax
returns, has been reported ?
Mr.CoFiNi. That is correct.
The Chairman. What were the 1956 convention expenses ?
Mr.CoFiNi. $7,375.
The Chairman. Ad up the totals for 1956. Let's see what it amounts
to.
Mr.CoFiNi. $31,350.
Tlie Chairman. And out of that, $14,600 was salary ?
Mr. CoFiNi. That is correct.
The Chairman. All right. Subtract it and let's see what total
expenses were.
Mr.CoFiNi. $16,750.
The Chairman. He got more expenses than salary, by about $2,000 ?
Mr. CoFiNi. That is correct.
The Chairman. Proceed.
Mr. Kennedy. Does the record show that he supported any of those
expenses, Mr. Calabrese ?
Mr. Calabrese. No, not for the years 1954, 1955, and 1956, which
he made available to us.
The Chairman. You are speaking of his income taxes ?
Mr. Calabrese. Yes, sir.
The Chairman. Have we checked with the National Labor Rela-
tions Board to see whether these expenses were accounted for here-
tofore ?
Mr. Calabrese. We did, Senator. We received only two from the
National Labor Relations Board, for the years of 1956 and 1957. They
could find no evidence for the prior years that we requested.
8124 IMPROPER ACTIVITIES IN THE LABOR FIEI^D
The Chairman. Wliat do these show for 1955 and 1956, with re-
spect to having reported expenses as required by law, to the National
Labor Relations Board ?
Mr. Calabrese. I have here before me the 1956 Labor Organization
Registration Form, which indicates that Mr. Weber received a total
compensation of allowances for the year of $20,400.
The Chair3IAn. $20,400. That is how many thousand dollars short ?
Mr.CoFiNi. About $11,000.
The Chairman. $11,000 of expenses that were not reported to the
National Labor Relations Board for tlie year 1956.
Mr. Calabrese. For the year 1957, it does show that Mr. Weber
received $15,250 for salary, and $9,050 for compensation for a total
of approximately $24,300.
The Chairman. Does that compensation or expenditure there in-
clude convention expense ; or do you know ?
Mr. Calabrese. I do not know.
The Chairjman. All right.
TESTIMONY OF PETER W. WEBER— Eesiimed
Mr. Kennedy. Mr. Weber, you were an official of the union when
the $12,000 plus was voted for Mr. Fay ?
Mr. Weber. I was.
Mr. Kennedy. Did you or any of the officials of the union have any
conferences or conversations w^ith William E. Maloney regarding that
money being paid to Mr. Fay ?
Mr. Weber. I think I spoke to Mr. Maloney about that, to President
Maloney.
Mr. Kennedy. You spoke to Mr. Maloney ?
Mr. Weber. Yes.
Mr. Kennedy. Where did you speak to him?
Mr. Weber. Either in Wasliington or in Atlantic City, I guess.
Somewhere.
Mr. Kennedy. Did you go to speak to him specifically about this
matter ?
Mr. Weber. I spoke to him.
Mr. Kennedy. Would you relate to the committee the conversation
you had with him ?
Mr. Weber. I asked him if the members would like to give Mr. Fay
a pension, and he said "Well, that is up to them. It is an autonomous
local union, and as long as it is properly voted upon, I have no ob-
jections."
Mr. Kennedy. He said he had no objection ?
Mr, AVeber. That is right.
Mr. Kennedy. Was it voted upon ?
Mr. Weber, It was.
Mr. Kennedy. Voted upon in a regular meeting ?
Mr. Weber. It was.
Mr. Kennedy. Of some 7,000 members in the union, how many of
that 7,000 were present at the meeting?
Mr. Weber. Well, I couldn't exactly say, but I think there was over
1,200 in the building. The place was packed. There wasn't any
standing room even.
IMPROPER ACTIMTTES IN THE LABOR FIELD 8125
Mr. Kennedy. Were they notified that this matter was to come up?
Mr. Weber. No ; I don't think so. They were just notified that there
was a meeting, and that is all.
Mr. Kennedy. There were about 1,200 at the meeting, do you say ^
Mr. Weber. That is right.
Mr. Kennedy. In the building, you said. Does that mean there'
were 1,200 at the meeting ?
Mr. Weber. In and around the meeting. The doors were open.
They knew what was going on.
Mr. Kennedy. How many actually attended the meeting ?
Mr. Weber. We could say about a thousand, who were within the
meeting hall.
Mr. Kennedy. Were the other members of the union notified in
any way that this sum of money had been voted for Mr. Fay?
Mr. Weber. We never notify them on any issues. We send them a
notice and they attend.
Mr. Kennedy. That is all. But you don't notify them what
transpires ?
Mr. Weber. If you notified them, they wouldn't come any way.
Tins way, if they want to attend a meeting, if they are interested in
the functions of their business, they come.
Mr. Kennedy. Did j^ou notify them as to what had transpired at
the meeting ?
Were they notified of that ?
Mr. Weber. Those that were in the meeting knew.
Mr. Kennedy. Was there any change in the bylaws, or was there
any step taken to get approval of the pension, other than just taking
it up with the membership who attended this meeting?
Mr. Weber. It was discussed by the members. They wanted to
assess them a week's pay. It was brought to our attention. Many
of them spoke to me. Many of the members wanted to assess them-
selves a week's pay, to help Mr. Fay and his family. Then it was
brought up before the executive board, an executive board discussed
it. Whatever work or wherever they were at, they probably discussed
it with the men in the field, and then it was brought up as an issue
before the members.
Mr. Kennedy. But no notice was sent out to the members informing
them of this?
Mr. Weber. We never notify them on anything that is going to be
taking place. It is up to them to come to the meetings to find out
what is going on.
Mr. Kennedy. Did you have any conversation with Mr. Maloney
about reinstating Mr. Fay in the union ?
Mr. Weber. Beginning when?
Mr. Kennedy. Any time. When he got out of jail or before he got
out of jail.
Mr. Weber. Do you mean when he was released ?
Mr. Kennedy. Yes.
Mr. Weber. I spoke to Mr. Maloney about it.
Mr. Kennedy. What conversations did you have ?
Mr. Weber. He told me it was up to the local union.
Mr. Kennedy. Where was that conversation that you had ?
21243—58 — pt. 20 14
8126 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Weber. That was down at Miami, at the A. F. of L. convention.
Mr. IvENNEDT. Did he say he would take it up with the executive
board at that time ?
Mr. Weber. He didn't say nothing at that time.
Mr. Kennedy. Did he subsequently ?
Mr. Weber. He told me as far as he was concerned, that was up to
the local union, whatever action they take would be perfectly all
right with them.
Mr. IvENNEDY. Did he say he was going to bring it up with the
executive board ?
Mr. Weber. At that time he didn't say so.
Mr. Kennedy. Did he subsequently say that?
Mr. Weber. He did, at a later date.
Mr. Kennedy. What happened then ? Tell us about that.
Mr. Weber. Probably after we attended another meeting of our
members. I came back to Miami.
Mr. Kennedy. When was this, approximately ?
Mr. Weber. I guess in February sometime.
Mr. Kennedy. 1956 ?
Mr. Weber. It could have been. And I talked to him then about
it, and I said, "The members voted on it, to reinstate him," and I told
him that many of the members didn't even know that he was sus-
pended.
"Well," he said, "they took care of it. You know the procedure in
getting a reinstatement for him. Send it to the secretary-treasurer
and he will act on it."
Mr. IvENNEDY. Send it to the secretaiy-treasurer of the interna-
tional?
Mr. Weber. That is right.
Mr. Kennedy. So did you do that ?
Mr. Weber. We did.
Mr. Kennedy. You sent it by mail ?
Mr. Weber. Yes ; it was.
No ; we were in — that was in March, I think, at our legislative con-
ference here in Washington. The president presented it to Mr.
Gramling personally.
Mr. Kennedy. To whom ?
Mr. Weber. To Mr. Gramling, deceased, personally. The full
minutes of the meeting, that is.
Mr. Kennedy. And Mr. Eeardon ?
Mr. Weber. That is right.
Mr. Kennedy. He was the president of 82.5 ?
Mr. Weber. I was with him at the time.
Mr. Kennedy. '\Yliere did he present it to him personally?
Mr. Weber. At our Washington office, 14th and K.
JMr. Kennedy. "Wliat happened after that? Did they take the
matter to the international ?
INIr. Weber. No ; 2 or 3 weeks later we inquired what was the holdup
on the reinstatement.
Mr. Kennedy. ^Vho did you inquire of?
Mr. Weber. Mr. Gramling.
Mr. Kennedy. Wliat did he say ?
IMPROPER ACTIVmES IN THE LABOR FIELD 8127
Mr. Weber. That Mr. Maloney was not in the office and he wouldn't
take the responsibility of the reinstatement until Mr. Maloney came in
and looked at the minutes.
Mr. Kennedy. Did you talk to Mr. Maloney afterward?
Mr. Weber. In Chicago.
Mr. Kennedy. Did you go out to see Mr. Maloney ?
Mr. Weber. No ; it was a convention.
Mr. Kennedy. You talked to him then about this ?
I\Ir. Weber. I spoke to him. He said "Well, there is a convention
going on. Suppose I take it up with the executive board."
Mr. Kennedy. So, did he ?
Mr. Weber. Yes; he did.
Mr. Kennedy. He informed you that he took it up with the executive
board ?
Mr. Weber. He did. He said he was going to take it up and he did,
Mr. Kennedy. He did take it up with the executive board ?
Mr. Weber. To my knowledge, he did.
Mr. Kennedy. And then did he have a subsequent conversation with
you about it? Did he tell you that he took it up with the executive
board ?
Mr, Weber. I don't know whether he told me, or whether Mr.
Gramling told me, that it was taken up and that we would get a re-
port on it after the convention.
Mr. Kennedy. Wlien was the convention ?
Mr. Weber. In April.
Mr. Kennedy. So if he took it up, he took it up at the executive
board of April 1956, right?
Mr. Weber. I don't know whether he took it up or not, but it was
discussed.
Mr. Kennedy. Were you ever informed that the matter was taken
up at the executive board ?
Mr. Weber. Yes, by either Mr. Gramling or Mr. Maloney, I don't
know definitely whom.
Mr. Kennedy. He said you would definitely get a report ?
Mr. Weber. That is right.
Mr, Kennedy. Did you get a report on it ?
Mr, Weber. I never got a report on it.
Mr. Kennedy. Did anyone in your union get a report on it ?
Mr. Weber. I guess the secretary did.
Mr. Kennedy. "Wlio was that?
Mr. Weber, Mr, Forsythe.
Mr, Kennedy, Wliat report did he get and from whom ?
Mr. Weber. That Mr. Fay was reinstated.
Mr. Kennedy. From whom did he get that report?
Mr. Weber. He got the telephone conversation from Mr. Maloney,
Mr. Kennedy. Did he ask Mr. Maloney at that time to write a
letter to that effect ?
Mr. Weber. ]Mr. Maloney said he don't write letters,
Mr, Kennedy, Did he ask him to write a letter ?
Mr, Weber, I don't know if he did or not.
Senator Ervin. You say Mr. Maloney said he didn't write letters?
Mr, Weber. He didn't write letters at that time. I don't know
why he said.
8128 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Ervin. I Iieard something about that one time. It said do
write and fear no man, don't write and fear no woman.
Mr. Weber. ]\Iaybe I guess that was his attitude, Senator.
Mr. Kennedy. But he told your people at that time he wouldn't
write a letter on this matter ; is that right ?
Mr. Weber. To my knowledge, yes ; it was told to me by the secre-
tary.
Mr. Kennei!^ . Do you know if the reinstatement of Mr. Fay was
ever printed in the executive board minutes of the international union ?
Mr. Weber. I don't know.
Mr. Kennedy. But you were informed that this action had been
taken by the executive board ? That is correct, isn't it ?
Mr. Weber. By Mr. Gramling or Mr. Maloney. I am not that
familiar.
Mr. Kennedy. Have you made a study of the executive board
minutes of the international, to determine whether the reinstatement
of Mr. Fay was discussed in any executive board meetings?
Mr. Calabrese. I have.
Mr. Kennedy. Have you made a study to determine whether the
action by the executive board appears in the minutes of the group,
of that group ?
Mr. CxVlabrese. I examined the records and they do not show any
record of this discussion or reinstatement of Joseph Fay by the inter-
national.
The Chairman. The Chair will make this announcement: We have
some matters coming up on the floor of the Senate which require the
presence of the chairman and possibly other members of the com-
mittee. Since we cannot conclude with this witness before time to
adjourn, I will recess the committee now, so that we may hope that
the members of the committee may get the business on the floor of
the Senate in which we are interested, disposed of in time that we can
return without any loss of time in the hearing. The committee will
stand in recess until 2 : 15.
(At this point, the following members were present: Senators
McClellan, Kennedy, Ervin, and McNamara.)
(Whereupon, at 12 : 15 p. m. the hearing recessed, to reconvene at
2 : 15 p. m. of the same day.)
AFTERNOON SESSION
(At the reconvening of the committee, the following membei*s were
present : Senators McClellan, Ervin. )
The Chairman. The committee will come to order.
The witness, Mr. Weber, is on the stand. You may proceed.
TESTIMONY OF PETER W. WEBER, ACCOMPANIED BY HIS
ATTORNEY, J. J. EGAN— Resumed
Mr. Kennedy. Mr. Weber, you went to contact Mr. Maloney, as we
understand from your testimony this morning, in order to have the
international take steps to reinstate Joe Fay?
AFr. AVkbeh. I didn't contact him for that, Mr. Kennedy. I went
and spoke to him. That was one of the things that I did speak to him
about.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8129
Mr. Kennedy. Well, I nieiin, in the course of conversation that came
lip and you did speak to him about that matter ?
Mr. Weber. I did.
Mr. Kennedy. And you understood through your fellow officials
that the international had taken steps to reinstate Mr, Fay; is that
correct ?
Mr. Weber. When was this ?
Mr. Kennedy. This is, I suppose, in April 1956.
Mr. Weber. Do you mean at the convention in Chicago ?
Mr. Kennedy. Yes. I just want to get the facts as you related them
this morning. He then telephoned to an official of your union, Mr.
Reardon, I believe ; is that right ?
Mr. Weber. No, not at that time.
Mr. Kennedy. At a later time ?
Mr. Weber. At a later date. I guess several months after that.
Mr. Kennedy. Wlien would that be, approximately ?
Mr. Weber. I think it is in the record and I can give you the exact
date.
Mr. Kennedy. Is it the May 7 date ?
Mr. Weber. Is that a part of the record ?
Mr. Kennedy. It is the report on the telephone conversation on May
7. Is that it?
Mr. Weber. May 7.
Mr. Kennedy. And it was after this telephone conversation took
place that action was taken at the local level to reinstate Mr, Fay; is
that right?
Mr. Weber. That is right.
Mr. Kennedy. When Mr. Fay was removed, he was removed — it
says, in case No, 1, and I am reading, Mr. Chairman, from the August
5 to 6, 1947, minutes of the meeting of the general executive board,
International Union of Operating Engineers.
The Chairman. All right.
Mr. Kennedy (reading) :
The full report was made to the general executive board of the oflBcial action
taken under date of June 24, 1947, removing the fourth general vice president
for cause from oflBce with the International Union of Opei-ating Engineers, and
declaring the office of fourth general vice president vacant, terminating the
membership of the incumbent thereon,^ whereupon, after full discussion by all
members of the board, and being in possession of all the circumstances, the
following resolution was unanimously adopted :
"Be it resolved, That the best interests of the International Union of Operat-
ing Engineers require that the fourth general vice president be removed from
office and his membership terminated ; and be it further
•'Resolved, That the official action heretofore taken under date of June 24,
1947, removing the fourth general vice president from office, and terminating
his membership in the International Union of Operating Engineers be, and the
same is hereby ratified, confirmed, and approved ; and be it further
"Resolved, That a vacancy in the office of fourth general vice president be
declared to exist and that a successor be elected."'
So that in order to reinstate Joe Fay in the union — and as I under-
stand he was reinstated retroactively to this date in 1947; is that
right, Mr. Weber ?
Mr. Weber. Not from the standpoint as a vice president. The only
thing that I know, to my knowledge, at the meeting, and in the min-
utes as you have read them off, was the action that was supposed to
have be^n taken at the executive board meeting, and it was attended
8130 IMPROPER ACTIVITIES IN THE UABOR FIELD
by the two officers of our local union in protest of the action taken
toward Mr. Fay.
Mr. Kennedy. Let me take them one at a time. In order to get
him reinstated, you had to get the approval of the international; is
that right?
Mr. Weber. It was never to my knowledge that it was necessary.
As I went and spoke to Mr. Maloney, he told me, from the first meet-
ing that I had with him, and brought the discussion up, he told me
that it was up to the members to reinstate him.
Mr. Kjennedy. Yes. Well, the general executive board took the
action to remove him, and removed his membership in the interna-
tional organization, according to the resolution, and then the general
executive board would have to take the action to reinstate him.
Mr. Weber. Yes ; which they did.
Mr. Kennedy. Once again we come back to the fact that the min-
utes of the general executive board have nothing in them to show
that he was reinstated. There is nothing in the minutes of the general
executive board to show that Joe Fay was ever reinstated in the Union
of Operating Engineers.
Mr. Weber. The way it shows that he is reinstated is he receives a
union book. I think I have one here. It is my own.
Would you like to see it ?
Mr. Kennedy. No. I am sure that you have one.
Mr. Weber. I have. This book is sent out by our international gen-
eral secretary-treasurer, on a report that Mr. Fay has been accepted
as a member of the International Union of Operating Engineers,
Local 825.
And his per capita tax has also been paid. Wliatever assessments
that were necessary were paid in order for him to comply with our
life benefit insurance plan with the international.
So they accept his dues, they accept his per capita tax. They also
include him in the benefits of the insurance plan. That automatically
reinstates him.
Mr. Kennedy. He was reinstated as of June 1947; is that right?
Mr. Weber. According to the record.
Mr. Kennedy. The facts are that the international executive board
took the action to remove him as fourth general vice president ; also
took the action to remove him from membership. There are no min-
utes of tlie general executive board to indicate or show that they ever
reinstated him.
Mr. Weber. I wouldn't know that. I had nothing to do with the
functions of the action of the executive board or any action that the
international has taken, with the exception that we were notified and
we followed the notification.
Mr. Ivennedy. Would you have any explanation that if they did
take this action to reinstate him, why it was not made known, why it
was kept hidden ? Do you have any explanation ?
Mr. Weber. I do not.
Mr. Kennedy. During this
The Chairman. Mr. Counsel, as I understand it, as far as the evi-
dence discloses here, the authorization from the international for Mr.
Fay to be reinstated was apparently verbal or oral or a telephone con-
versation, while the local, in reinstating him, and in granting him a
pension, made a record of it that is covered in their minutes.
IMPROPER ACTIVITIES IK THE L.\BOR FIELD 8131
Mr. Kennedy. That is correct.
The Chairman. But the international record is completely silent?
Mr. IvENNEDY. That is correct.
The Chairman, There is nothing there to indicate that it approved
or disapproved or that it took any formal action one way or the other.
Mr. Kennedy. With the understanding, Mr. Chairman, that the
international executive board that first took the action to remove
Mr. Fay, they were the ones
The Chairman. I am talking about reinstatement.
The international removed him.
that correct ?
Mr. Kennedy. That is correct.
The Chairman. But there is no record of his reinstatement or
being granted the pension so far as the international is concerned.
Mr. Kennedy. That is correct.
Now, Mr. Chairman, he did receive, as I understand it, a book,
such as Mr. Weber pointed out, and that book had to come from the
secretary-treasurer of the international.
Mr. Weber. That is correct, Mr. Kennedy.
The Chairman. So obviously the international knew of the action
taken by the local union insofar as your reinstating him ?
Mr. Weber. Yes, sir.
The Chairman. And so far as you are concerned, you talked to
the international president about it ?
Mr. Weber. I did.
The Chairman. And he knew it was being contemplated ?
Mr. Weber. He knew of every action, and the whole executive
board knew of every action, we were taking with reference to
Mr. Fay at our regular meetings.
The Chairman. So the international approved it, and they accepted
it, and made no record of their action approving it.
Mr. Weber. I don't know what they did, but we know what we
did.
The Chairman. Well, we are unable to find any record of it. All
right. In other words, it leaves the record this way: If the inter-
national expelled him, the international, so far as its records are
concerned, never reinstated him.
Mr. Weber. I don't say that.
The Chairman. Well, they have no record of it.
Mr. Weber. They have a record that he is a member in good stand-
ing with our local union, so that automatically puts him m the posi-
tion of being a member.
The Chairman. We have no record that they took action rein-
stating him.
Mr. Weber. They accept his dues, accept the per capita tax we send
in to them, so they can automatically accept' him. Whether he is
a member, he is a bona fide
The Chairman, I am not questioning that. From your statement,
I believe he would be a member. But the strange thing is to leave
the record silent, and take official action through resolutions, expelling
him, and let him come back, by just handing him a book, and say
nothing about it.
I am talking about the international.
8132 IMPROPER ACTIVITIES IN THE DABOR FIEI.D
Mr. Weber. I don't know what records tliey have. I have no access
to them, Senator, and whatever they do, it is none of my business.
The Chairman. You mean in the record here, there is simply an
acceptance of it by issuing them a book, so far as our records show,
so far as the testimony here up to now.
Mr. IVENNEDT. In addition, according to your testimony of this
morning, when you asked for a letter from the international confirm-
ing this telephone conversation, Mr, William Maloney told you that
he did not write letters?
Mr. Weber. Not I, Bob. Excuse me, Mr. Kennedy.
Mr. Kennedy. That is all right. One of the fellow officials of the
union ?
Mr. Weber. That is right.
Mr. Kennedy. We have had some testimony here regarding the
fact about Mrs. Fay being on the payroll of the union while Mr.
Fay was incarcerated.
Were you aware of the fact that she was on the payroll ?
Mr. Weber. I was at the meeting when it was voted.
Mr. Kennedy. What position did she have in the union ?
Mr. Weber. Whatever she was able to do. There was no set duties
for her. Wliatever she was able to do, and work in conjunction, and
whatever information she could give the officers of the local union.
There were no set duties. It was just automatically. The lady was in
need of some income, and the members, at a meeting, voted on it, and
it was the mandate of the members to give her some compensation.
Mr. Kennedy. Whenever she felt that she could do something, she
contributed, l)nt as far as having any official duties to perform, as
far as arriving at 9 o'clock in the morning and leaving at 5 o'clock
at night, she did nothing like that ?
Mr. Weber. To my knowledge, counsel, I don't know that she had
any assigned duties.
Senator Ervin, I believe she got the kind of job I have been looking
for all my life.
Mr. Kennedy. I believe we discussed also the pay or salary that
was voted to Mr. Fay. Then there has been some discussion about
the fact that some of his legal bills were paid by the local union.
jNIr. Weber, As a matter of record, correct.
Mr. Kennedy. How much of his legal fees, Joe Fay's legal fees,
during the period from 1943 until the present time have been paid by
the local union ?
Mr. Weber. I think it is a matter of record,
Mr, Kennedy. Do you have those figures ?
Mr. Weber, I don't know. I haven't got them.
Mr, Kennedy. You do not have them ?
Mr. Weber. No ; I have not.
Mr. Kennedy. You don't know how much has gone out for legal
fees to Joe Fay ?
Mr, Weber. Right now?
Mr. Kennedy. Yes.
Mr. Weber, None.
Mr. Kennedy, Do you know how much has been paid by the union
for the legal fees for Joe Fay?
Mr. Weber. The bills are there, the checks are drawn up, and I
think your investigators have picked it up. They Imow ; I don't know.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8133
Mr. Kennedy. I am trying to get some help from the witnesses. I
am trying to find out from you as the manager of the local how much
has been paid by the local for the legal fees of Joe Fay.
Mr. Weber. From 1953?
Mr. Kennedy No; when he first got in difficulty and was indicted
by the district attorney up in New York. Do you know how much of
his legal fees have been paid for by you ?
Mr. Weber. That was handled by the previous officers of the local
union. They knew; I didn't know. It was discussed at a meeting,
and whatever was paid was in open discussion at a meeting.
jNIr. Kennedy. Anything that was necessary was paid ; is that right?
Mr. Weber. Wliatever the fees were that were necessary.
Mr. Kennedy. Is that right from the time that he was indicted for
this extortion amounting to $600,000 or $700,000?
Mr. Weber. I think it was a mandate at a meeting each year that
whatever expenses were necessary for legal fees, or, other necessary
matters, for Mr. Fay and his family, were voted on and a mandate
made by the members of the local union to comply with those.
TESTIMONY OF EOBEET J. COFINI— Eesimied
Mr. Kennedy. Mr. Cofuii, do we have any figures on the amount
of legal fees that have been paid for Mr. Fay by the union since 1943?
Mr. CoFiNi, My figures show only from the year 1947, We were
unable to get any records prior to that time.
Mr. Kennedy. So your figures would only show from 1947 to date ?
Mr. CoFiNi. Yes.
IVIr. Kennedy. Would your figures be conservative, or would they
be the full amount ?
Mr. CoFiNi. Well, they would be conservative, because there were
some payments that could not actually be traced to Mr. Fay. There
was a mixture of legal fees for both the local and for Mr. Fay. They
could not be determined . So I excluded those.
Mr. Kennedy. This figure for 1947 is from 1947 until what time?
Mr. CoFiNi. Until the end of 1956.
Mr. Kennedy. To the end of 1956 ?
Mr. CoFiNi. Yes.
The Chairman. To keep the record clear, these are direct payments
that you can account for ?
Mr. CoFiNi. That is cori-ect.
The Chairman. The records reflect they are for the benefit of Mr.
Fay, for his legal counsel ?
Mr. CoFiNi. That is right.
The Chairman. And there were other expenditures during that
period of time, for legal services, when you could not be sure whether
any of it or what part of it went for the benefit of Mr. Fay ?
Mr. CoFiNi. That is correct.
The CHiViRMAN. You may give the amount that you know is posi-
tive.
Mr. CoFiNi. $63,150 is the amount.
The Chaieman. $63,150?
Mr. CoFiNi. Yes, sir.
The Chaieman. That is for lesral fees ?
8134 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr, CoFiNi. For legal fees paid by local 825 on behalf of Mr.
Fay.
The Chairman. And you know according to the records that was
the minimum?
Mr. CoFiNi. That is the minimum.
The Chairman. But how much the maximum was you could not
determine ?
Mr. CoFiNi. I couldn't determine.
Mr. IvENNEDT. $63,000 is the amount.
TESTIMONY OP PETER W. WEBER— Resumed
Mr. Kennedy. Mr. Weber, as far as you are concerned, personally,
we went through your salary and your expenses. Do you have any
other source of income other than your union employment ?
Let me ask this, and I will strike that question. Do you have any
other business interests other than your work with the union?
]VIr. Weber. Investments.
Mr. Kennedy. What kind of investments do you have ?
]Mr. Weber. Stocks.
Mr. Kennedy. Any other kinds of investments ?
Mr. Weber. Government bonds.
Mr. Kennedy. Anything else ?
Mr. Weber. That is about all, stocks and bonds.
Mr, Kennedy. Do you have any interests in any businesses?
Mr, Hayden. May I consult with Mr. Weber to be sure he is get-
ting your question properly, Mr. Kennedy ?
Mr. Kennedy. Yes.
(Witness conferred with counsel.)
Mr. Kennedy. Do you have any interests in any other businesses?
Mr. Weber. Yes.
Mr. Kennedy. Well, I would like to hear about them.
Mr. Weber. Do you mean the Public Constructors ?
Mr. Kennedy. Do you have an interest in a company called Public
Constructors ?
Mr. Weber. Yes ; I have.
Mr. Kennedy, What is the full name of that company ?
Mr, Weber, The Public Constructors Co.
Mr. Kennedy. Public Constructors, Inc. ?
Mr. Weber. It could be ; yes.
Mr, Kennedy, What does Public Constructors, Inc., do ?
Mr. Weber. It is a construction company.
Mr. Kennedy. Wliat do thej^ construct ?
]Mr. Weber, From the original conception of the company, they
started ovit as a landscaping company.
Mr. Kennedy. "WHien did you get into the company ?
Mr. Weber. About 8 or 9 years ago, 7 years ago.
Mr. Kennedy. About 1950 ?
]\Ir. Weber. I am not exact with the dates. It may be around there
some time.
Mr. Kennedy. Wlio was in business with j^ou ?
Mr. Weber. Well, from the original inception, it was a loan.
Mr. Kennedy. To whom did you loan the money ?
Mr. Weber. Jim Brown.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8135
Mr. I^NNEDY. "Wliat does Jim Brown do ?
Mr. Weber, He is an engineer, a member of our miion.
Mr. IvENNEDY. He is a member of the miion ?
Mr. Weber. Yes.
Mr. Kennedy. Is he an official in the union or just a member?
Mr. Weber. Just a member.
Mr. I^nnedy. You loaned some money to him. How much did
vou loan ?
Mr. Weber. $2,500.
Mr. Kennedy. Whom was he in business with ?
Mr. Weber. At that time I think it was Kay Fisher.
Mr. Kennedy. Who is Ray Fisher?
iNIr. Weber. He is the president of the company now.
IMr. Kennedy. What kind of work had he been doing ?
Mr. Weber. He was an engineer, a civil engineer.
Mr. Kennedy. For whom was he working ?
Mr. Weber. S.A.HealyCo.
Mr. Kennedy. S. A. Healy Co. ?
Mr. Weber. Yes.
Mr. Kennedy. WhowasS. A. Healy Co.?
Mr. Weber. Contractor that was doing work on the waterworks
projects in New York State.
Mr. IvENNEDY. Is S. A. Healy one of the biggest contractors in the
country, would you say ?
Mr. Weber. No.
Mr. Kennedy. A major contractor?
Mr. Weber. He is a general contractor.
Mr. Kennedy. A major general contractor in the country ?
Mr. Weber. Yes.
Mr. I&:nnedy. I believe we had some testimony regarding the work
that S. A. Healy Co. does in Philadelphia.
Do they also do some work within your district, the district covered
by local 825?
Mr. Weber. Yes.
Mr. KJENNEDY. So you had Mr. Fisher and this other gentleman —
what was the name of the first man ? Mr. Brown ?
Mr. Weber. Jim Brown.
Mr. Kennedy. Mr. Brown, Mr. Fisher, and who else was in the
company ?
Mr. Weber. A fellow by the name of Fred See.
Mr. Kennedy. What is the last name ?
Mr. Weber. See. S-e-e, I think it is.
Mr. Kennedy. And John Kierney ?
Mr. Weber. That is right.
Mr. Kennedy. Fred Marks ?
Mr. Weber, That is right.
Mr. Kennedy. And you loaned them $2,500 ?
Mr. Weber. I did.
Mr. Kennedy. Did you subsequently take an interest in the same
company ?
Mr. Weber. At a later date, Mr. Kennedy. I don't know the exact
date, but I went up to Mr. Brown, and I think it was Fisher, and I
asked them when was I going to get the money back. They says they
8136 IMPROPER ACTIVITIES IN THE K\BOR FIELD
haven't got any ; it looks like the company is going broke. Well, I says
"How am I going to protect my $2,500 ?"
Well, the only thing— at that time, I think they were taking it up
with their accountant to form a stock company. They said they would
give me $2,500 worth of stock in order to protect the investment.
Mr, Kennedy, So how many shares of stock did you get ?
Mr. Weber. 25 shares.
Mr. Kennedy. What business did they begin in then? Wliat busi-
ness were they involved in? What kind of construction work was it?
Mr. Weber. It was no construction work. It was landscaping.
Mr. Kennedy. When did you start to do construction work?
Mr. Weber. After we organized the landscaping contractors
throughout the State of New Jersey and New York, they couldn't
receive any more work, so they went into competitive bidding.
Mr. Kennedy. In construction work ?
Mr. Weber. All phases of construction, within their limits of their
bond.
Mr. Kennedy. In what area of the country were you working?
Mr. Weber. I don't know. They work through New York State
and they worked through certain parts of Jersey.
Mr. KJENNEDY. Did you have some business dealings with S. A.
HealyCo.?
Mr. Weber. I did not.
Mr. Kennedy. Did the company, the public contractors ?
Mr. Weber. I imagine they did ; I woudn't know.
Mr. Kennedy. And from George M. Brewster Co ?
Mr. Weber. I guess so.
Mr. KJENNEDY. George M. BreAvster was one of those companies
that testified in the Fay case, isn't that correct?
Mr. Weber. It is on the record.
Mr, Kennedy, Isn't that correct?
Mr. Weber. I guess so.
Mr. Kennedy. What is the value of the company now, do you have
those figures, Mr, Weber ?
Mr. Weber. No, sir,
Mr. Kennedy. Do you employ operating engineers in this com-
pany?
Mr. Weber, I do not,
Mr. Kennedy. Do any operating engineers work for this company ?
Mr. Weber. The employment of the men to that contractor go
through the same channels that any other contractor goes.
Mr. Kennedy. Just answer the question : Do any operating engi-
neers work for this company ?
Mr. Weber. Yes.
Mr, Kennedy, Who signs the contract with this company for your
local ?
Mr. Weber, For our local ?
Mr, Kennedy, Yes.
Mr, Weber. The president, myself and the recording secretary.
Mr. Kennedy. So you would sign the contract as a business man-
ager of the local with your own company, is that right, covering these
operations ?
Mr. Weber. Not my company. Let us keep the record clear. I
am only a stockholder.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8137
Mr. Kennedy. In wliich _you have u financial interest.
Mr. Weber. Not any more than I liave in our Government of the
United States when I purchase bonds.
Mr. Kennedy. You have a one-eighth interest in this company, I
believe?
Mr. Weber. That is correct.
Mr. Kennedy. So you, as a representative of the union sign the con-
tract of this company in which you have this interest, is that right?
Mr. Weber. One of the signatures to the agreement.
Mr. Kennedy. Would you look at this contract ?
(A document was handed to the witness.)
The Chairman. The Chair presents an agreement entered into by
and between Public Constructors, Inc., and the International Union of
Operating Engineers, dated 7th day of October 1957; apparently, it
bears your signature. I will ask you to examine it and state whether
this is a photostatic copy of the conti-act entered into between Public
Constructor, Inc., and the International Union of Operating Engi-
neers, Local Unions 825, A, B, C, and so forth, on that date.
Mr. Kennedy. I think the signatures would be in the back.
Mr. Weber. I am going through the conditions of the agreement.
Mr. Kennedy. I do not think that is necessary. All I want to do is
find out who signed the contract, with the company in which you had
a financial interest.
The Chairman. The witness may look at it sufficiently to identify
it.
Mr. Weber. It is my signature on here.
The Chairman. Is there any doubt in your mind that that is a
photostatic copy of the contract ?
Mr. Weber. No doubt at all. Senator.
The Chairman. That contract may be made exhibit No. 83 for
reference only.
(The document referred to was marked "Exhibit No. 83" for refer-
ence and may be found in the files of the select committee.)
Mr. Kennedy. This is a standard type contract ?
Mr. Weber. It is a general contract that we have with probably 90
percent of the employers working in the territory of local 825.
?'^-'. Kennedy. You say tlmt this company does construction work
in XeAv York and do they do any construction work in any other
section of the countr}^ ?
Mr. Weber. Yes. At this time, I understand they do.
Mr. Kennedy. ^Hiere?
Mr. Weber. Indiana or Illinois.
Mr. Kennedy. A^Hiat contract are you working on out there ?
Mr. Weber. I don't know.
Mr. Kennedy. Is there a road contract that you have?
Mr. Weber. To the best of my knowledge ; yes.
Mr. Kennedy. How about the northern Illinois toll highway, do
you have a contract with them, $7 million ?
Mr. Weber. I don't know anything about it. If they have it, they
have it.
Mr. Kennedy. You have a rather considerable interest in this
company.
Mr. Webek. I do not have a considerable interest.
8138 IMPROPER ACTIVITIES IN THE K\BOR FIELD
Mr. Kennedy, You have an eighth interest and it is about as great
as anybody else's interest in the company.
Mr. Weber. I don't have anything to do with the functions of the
company, Mr. Kennedy ; I never did.
Mr. Kennedy. You have this major interest in the company.
Mr. Weber. I never had anything to do with the company and I
will tell you this much truthfully, that while they were in on that
job, I didn't know about it until there was some newspaper reporters
called me on it.
Mr. Kennedy. You mean regarding this contract ?
Mr. Weber. That is right.
Mr. Kennedy. Then you know at this time. You know now, do
you not ?
Mr. Weber. No, I don't bother with what they do.
Mr. Kennedy. You never discussed it at all ?
Mr. Weber. No, sir.
Mr. Kennedy. You never mentioned or nobody ever mentioned to
you, to the officials of the company ?
Mr. Weber. We know that they had it and it was up to the officers
of the company to operate it, and I entrusted them with my finances
and they run it and I don't.
Mr. Kennedy. Therefore, you were fully aware of the fact tliat you
had the contract.
Mr. Weber. That is all. I knew they were there and they had a
legitimate contract in competitive bidding.
Mr. Kennedy. Now, what union would your company deal with in
that area, as far as the Operating Engineers are concerned?
Mr. Weber. Not my company, let us get the record straight.
Mr. Kennedy. I believe it is your company.
Mr. Weber. It is not my company and you can't prove it is my
company.
Mr. Kennedy. You have an interest.
]Mr. Weber. I have an interest in the like I have in other ventures.
]Mr. Kennedy. This company in which you have an interest, with
what local of the Operating Engineers does this company in which you
have an interest have a contract ?
]\lr. Weber. Whatever local is in that territory.
Mr. Kennedy. Do you know what local is in that territory ?
Mr. Weber. To my knowledge, it is local 150.
Mr. Kennedy. Is that the local that is under trusteeship of William
E. Maloney ?
Mr. Weber. I wouldn't know anything about the local.
iMr. Kennedy. You do not know if the local is under trusteeship ?
Mr. Weber. I do not.
Mr. Kennedy. You do not know that ?
Mr. Weber. No.
yir. Kennedy. You do not know that the local 150 in Chicago is
under trusteeship and has been under trusteeship since 1929 ?
Mr. Weber. It is only hearsay or newspaper stories.
JNIr. Kennedy. Have you heard that that local was ?
Mr. Weber. I heard but I didn't Imow.
Mr. Kennedy. You heard it then ?
Mr. Weber. Yes, sir.
Mr. KJENNEDY. You understood it was under trusteeship?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8139
Mr. Weber. I did not understand. I heard.
Mr. Kennedy. Then you heard it.
Mr. Weber. That is right.
]\Ir. Kennedy. That is under the direction of Mr. Maloney who is
the international president and he appoints the trustee?
Mr. Weber. I don't know what he does. I don't know what he does.
Mr. Ivennedy. Under the constitution of the Operating Engineers —
and I think we will go much faster, Mr. Weber, if you just admit and
say the things that you do know.
Now, you know that.
Mr. Weber. I am telling you the truth ; I am under oath.
Mr. Kennedy. You have good reason to believe that local 150 is
under trusteeship and there can't be
Mr. Weber. I don't believe everything I read or everything I hear.
Mr. Kennedy. You cannot be in the Operating Engineers Union for
more than a year and not know local 150 is under trusteeship and it is
common knowledge and well known.
Mr. Weber. I happen to be the one that doesn't know, is that all
right?
Mr. Kennedy. Tell me this about the company in which you have
this one-eighth interest: You invested $2,500 and do you know how
much your 25 shares are worth at the present time ?
Mr. Weber. I do not.
Mr. Kennedy. You haven't any idea ?
Mr. Weber. No, sir.
Mr. Kennedy. You have not inquired into that?
Mr. Weber. No.
Mr. Kennedy. Would you like to know ?
Mr. Weber. No, not necessarily. I never was interested.
Mr. Kennedy. Could we look that up ?
The Chairman. You do solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth and nothing but the truth, so help you God ?
Mr. Prinos. I do.
TESTIMONY OF JOHN PRINOS
Mr. Prinos. My name is John Prinos, General Accounting Office.
The Chairman. Have you made an examination of the records of
this Public Construction, Inc. ?
Mr. Prinos. We have, and we are still conducting an investigation.
The Chairman. All right. Have you made an evaluation of the
company's assets to date ?
Mr. Prinos. We have the book value per share computed.
The Chairman. How many shares are outstanding ?
Mr. Prinos. Two hundred shares at $100 a share.
The Chairman. All right. What is the book value of it as of now?
Mr. Prinos. In the fiscal year September 30, 1950, the book value
was $30.40 a share. On September 30, 1957, it is ^,347.09 a share.
So that Mr. Weber's 25 shares were valued in 1950 at $761.75 and
today they are worth $108,077.
Mr. Kennedy. Is that including tlie $7 million contract ?
Mr. Prinos, I don't believe so, since the books are set up lliis Avay.
The Chairman. Thatisa very profitable investment.
8140 EN'IPROPER ACTlVITIEiS IN THE LABOR FIElrD
Senator Ervin. And, Mr. Chairman, if a cat hadn't any more curi-
osity than the witness, the cat would still be living.
The Chairman. I am sure the witness knows something about that.
You say that is a fair estimate of its value, now, Mr. Weber ?
Mr. Weber. I don't know. Senator.
The Chairman. You would not know ? All right, proceed. Let us
see what else we can determine.
TESTIMONY OF PETER W. WEBER— Resumed
Mr. Kennedt. Do you have interests in any other company, other
than Public Constructors, Inc. ?
Mr. Weber. Yes, United Engine.
Mr. Kennedy. United Engine, what is that ?
Mr. Weber. United Engine Service Co.
Mr. Kennedy. What do they do ?
Mr. Weber. Repair equipment and repair motors.
Mr. Kennedy. Repair motors?
Mr. Weber. Yes, sir.
Mr. Kennedy. What kind of motors ?
Mr. Weber. Any type of motors, power-driven equipment and
power-driven motors.
Mr. Kennedy. And who is in that company with you ?
Air. Weber. I don't know. There are a group of men in there.
Mr. Kennedy. Do you repair heavy construction work and equip-
jnent ?
Mr. Weber. I do.
Mr. Kennedy. Is that right?
Mr. Weber. They do.
Mr. Kennedy. And repair engines on this type of equipment ?
Mr. Weber. They do.
Mr. Kennedy. Could you tell us who else is in there Avith you ?
Mr. Weber. Offhand, I don't know.
Mr. Kennedy. You do not know who is in that business with you ?
When did you get into that business ?
Mr. Weber. Around 4 years ago.
Mr. Kennedy. Could I read some of these names over so that you
could identify them or tell me if they are interested in this business
with you? In 1054 Hank Lensky invested $4,000. Is he in this
business with you ?
Mr. Weber. He was the starter of the company.
Mr. Kennedy. What is his business? Does he have any other in-
terests ?
Mr. Weber. I wouldn't know, and he may be in other businesses,
and I don't know.
Mr. Kennedy. What is his other source of income ? Does he work
anywhere else, that you know of ?
Mr. Weber. No.
Mr. Kennedy. He has just been a friend of yours.
Mr. Weber. He Avasn't a friend of mine; he was a friend of Jim
Brown's.
Mr. Kennedy. Jim Brown got you interested in the company, also?
Mr. Weber. That is right.
IMPROPER ACl^IVITIES UST THE LABOR FIELD 8141
Mr. Kennedy. And Eay Fisher; lie is the same Ray Fisher we
mentioned before ?
Mr. Weber. That is right.
Mr. Kennedy. With S. A. Healy Co. ?
Mr. Weber. Yes, sir.
Mr. Kennedy. Jack Byers?
]Mr. Weber. Yes, sir.
Mr. Kennedy. He has $4,000 ; who is he ?
Mr. Weber. Jack Byers and Plank Lensky ; they were the two run-
ning the company.
Mr. Kennedy. Did you know Jack Byers before ?
Mr. Weber. I never met him before.
Mr. Kennedy. And Solly Leary ?
Mr. Weber. A member of our union.
Mr. Kennedy. Is he a business representative ?
Mr. Weber. No.
Mr. Kennedy. No official?
Mr. Weber. No ; I think he is a board member or something.
Mr. Kennedy. He is a board member of your local ?
Mr. Weber. Yes, sir.
Mr. Kennedy. I believe he is. He is in this business with you?
Mr. Weber. Yes.
Mr. Kennedy. And E. Weber ?
Mr. Weber. That is my brother.
Mr. Kennedy. You and your brother each invested $2,000?
Mr. Weber. That is right.
Mr. Kennedy. J. Smith ?
Mr. Weber. That is right.
Mr. Kennedy. Who is he ?
Mr. Weber. One of the business representatives.
Mr. Kennedy. He is another business representative of the union ?
Mr. Weber. That is right.
Mr. Kennedy. D. Reardon?
Mr. Weber. That is right.
Mr. Kennedy. Who is he?
Mr. Weber. What is the other name ; D. Reardon ?
Mr. Kennedy. That is all we have. Is he president of the local?
Mr. Weber. If it is senior, yes.
Mr. Kennedy. It just says D. Reardon. Was the president of the
local in this business with you ?
Mr. Weber. I think that he has some shares in it.
Mr. Kennedy. G. Frawley.
Mr. Weber. Yes.
Mr. Kennedy. Is he in the local ?
Mr. Weber. Yes.
Mr. Kennedy. What is his position ?
Mr. Weber. He is a board member, too.
Mr. Kennedy. And Brown; he has been mentioned; and Grace.
Who is Grace ?
Mr. Weber. Jimmy Grace. It is Mrs. Grace now ; he is deceased.
Mr. Kennedy. Was he in the local ?
Mr. Weber. Yes, sir.
Mr. Kennedy. Was he an officer of the local ?
21243— 58— pt. 20 15
8142 IMPROPER ACTRITIES IX THE LABOR FIELD
Mr. Weber. Business representative.
Mr. Kennedy. And J. Fanning.
Mr. Weber. That is right.
Mr. Kennedy. What is he ?
Mr. Weber. A member of the union.
Mr. Kennedy. Is he a business representative?
Mr. Weber. No.
Mr. Kennedy. So, you had 1 member of the union and 3 or 4 officials
of the union in this company with you, is that right ?
Mr. Weber. That is right.
Mr. Kennedy. And you were repairing engines and repairing
equipment; is that right?
Mr. Weber. That is right.
Mr. Kennedy. And the equipment that you were repairing was of
companies that had contracts with the Operating Engineers ; is that
right?
Mr. Weber. Not all of them.
Mr. Kennedy. Some of them ?
Mr. Weber. It could be.
Mr. Kennedy. Well, isn't it true that they were, and they did have
contracts with the engineers ?
Mr. Weber. Not all of them.
Mr. Kennedy. I am not saying that.
Mr. Weber. Some of them could be.
Mr. Kennedy. Don't you know that some of them did ?
Mr. Weber. I don't know, and I know nothing about the operations.
Mr. Kennedy. But don't you know, as a fact, that some of the com-
panies whose equipment you repaired had contracts with the Operat-
ing Engineers, Mr. Weber ; that is all I am asking you, and I am not
saying all of them.
Mr. Weber. Mr. Kennedy, I did not know with whom they did busi-
ness, or what they did with it. We invested in it to start an equip-
ment company to compete against nonunion equipment companies.
Mr. Kennedy. You say you don't know that ?
Mr. Weber. I do not.
Mr. Kennedy. You do not know any company which had their en-
gines repaired by the union Engine Service Co., with whom the Oper-
ating Engineers had a contract ?
Mr. Weber. Offhand, I did not.
Mr. Kennedy. We will tell you that a number of them did.
Mr. Weber. I didn't know it, and I never looked at records.
Mr. Kennedy. Did you have any other interests and any other busi-
ness interests ?
Mr. Weber. A beer-distributing business.
Mr. Kennedy. When did you go into that ?
Mr. Weber. In 1947, right after I got my eye injured. It was
started in 1944, 1 think, or 1945.
Mr. Kennedy. Now, going back to union Engine Service Co. ; it has
not been a profitable venture, particularly?
Mr. Weber. Anything that I am in is not profitable with the ex-
ception of Public Constructors.
Mr. Kennedy. That has been very profitable and so it will make
up for it.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8143
Mr. Weber. I never got anything out of it, with tlie exception I got
a dividend this year.
Mr. Kennedy. That has not been a profitable venture, as I under-
stand it ; is that right ?
Mr. Weber. No, sir. Neither is the engine company.
Mr. KJENNEDY. What about your beer distributorsliip, whom did
you get your distributorship from ?
Mr. Weber. From some representatives of a brewery.
Mr. Kennedy. What brewery ?
Mr. Weber. Ballentine.
Mr. Kennedy. Do you have any other business interests other than
the beer distributorship. Public Constructors, Union Engine Service
Co.?
Mr. Weber. In J. Crane Sei-vice, or New Jersey Equipment, or
something like that.
Mr. Kennedy. Xew^ Jersey Equipment Co. ?
Mr. Weber. Yes, sir.
:Mr. Kennedy. What do they do ?
Mr. Weber. It is crane service.
Mr. Kennedy. What does that mean — "crane service"?
Mr. Weber. They rent out cranes, and they have two cranes in it,
I think.
Mr. Kennedy. To whom do they rent cranes ?
Mr. Weber. To whomever wants to hire them.
Mr. Kennedy. Well, is that companies that have contracts w^ith the
Operating Engineers ?
Mr. Weber. Some have it and some don't.
Mr. Kennedy. What do you mean "some don't"? Do you rent to
non-union companies ?
Mr. Weber. I don't know. They could rent to the railroads and
they could rent to industry.
Mr. Kennedy. The Operating Engineers run cranes, generally ?
Mr. Weber. Yes; they do.
Mr. Kennedy. This company rents cranes ?
Mr. Weber. Yes, sir.
Mr. Kennedy. The New Jersey Equipment Co. ?
Mr. Weber. Yes, sir.
IVfr. Kennedy. And they have been in existence for how long?
Mr. Weber. Four years.
Mr. Kenkedy. With whom are you in business in that company ?
Mr. Weber. Mr. Fisher, I think, and a Mr. Foran, and a lady, and
I don't know just
Mr. Kennedy. Minnie Zimmerman ?
Mr. Weber. Yes, sir ; I think that is the name.
Mr. Kennedy. Who is Minnie Zimmerman ?
Mr. Weber. She is the mother-in-law, I think, of Mr. Fisher.
Mr. Kennedy. And you got a 25 percent interest in that company ;
is that right ?
Mr. Weber. I don't know whether I have a half interest in one
crane or a quarter of each.
Mr. Kennedy. Did you put up the money ?
Mr. Weber. No; it wasn't necessary. 'l put up my house as col-
lateral and the cranes went to Avork, and so the rental of the cran-^s
8144 rMPROPER ACTIVITIEiS IN THE LABOR FIEI.D
were toward the purchase of the cranes and so we got no dividend
out of them until the commitment of the costs of the cranes were
paid out.
Mr. Kennedy. So you did not have to invest any money in that
company ?
Mr. Weber. Outside of my house as collateral.
Mr. Kennedy. Do you have any records to show that you put your
house up ?
Mr. Weber. No; as a matter of discussion, I don't know whether
there was a letter which stated that, but it was a matter of discussion.
Mr. Kennedy. Who discussed that ?
Mr. Weber. Mr. Fisher.
Mr. Kennedy. Now, Mr. Fisher would verify that, if it is so, that
you put your house up ?
Mr. Weber. I imagine so.
Mr. Kennedy. You actually put your house up as collateral?
Mr. Weber. I didn't, but I was willing and I have done it in the
beer business.
Mr. Kennedy. You gave the impression here that you actually put
your house up as collateral.
Mr. Weber. No; I told them that I would use the house as col-
lateral and if it was necessary to get any loans on it, I could get loans
on my home.
Mr. Kennedy. Actually, then, you did not put your house up as
collateral.
Mr. Weber. It was not necessary and I explained that the cranes
were rented out and the rental of the cranes was toward the purchase
of the cranes.
(Members of the select committee present at this point in the pro-
ceedings were Senators McClellan and Ervin. )
Mr. Kennedy. Excuse me, Mr. Weber. I must have misunderstood
you. I thought you said you put your house up.
Mr. Weber. No.
Mr. Kennedy. So you got the Jersey Equipment Co., the Public
Contractors, Inc., the Union Engine Service Co., the brewery dis-
tributorship.
Do you have any other interests ?
Mr. Weber. I have. Bob — you said that I have. Pardon me. Mr.
Kennedy. You said I have. I have an interest in those.
Mr. Kennedy. I stand corrected.
Mr. Weber. All right.
Mr. Kennedy. Do you have any other interests ?
Mr. Weber. Not that I know. I don't think so. I may. I don't
know.
Mr. Kennedy. You may and you don't know ?
Mr. Weber. I probably done some favor for somebody and they
probably put me in as a partner, but I don't think so.
Mr. Kennedy. What does that mean, jNIr. Weber? Do you mean
somebody just stuck you in as a partner in some company ?
Mr. Weber, No. Some of our members may go into the eqnii)ment
business, and they call me up and ask me will I vouch for tliem witli
some of these equipment companies. So they call me and I give them
a recommendation tliat they are good, steady members of our union.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8145
that they are good engineers, they have qualifications in that line of
work, and there wouldn't be no risk in putting these men on their
credit, and I would vouch for them. _
Mr. Kennedy. Do you knoAv of any other company m which you
have an interest ?
Mr. Weber. No.
Mr. Kennedy. Just somebody that may have put your name m^
Mr. Weber. It could be. I am only saying that in the event that
maybe your investigators found that out. That is the reason.
Mr. Kennedy. What about Public Contracting Corp. ?
Mr. Weber. I know nothing about that, Mr. Kennedy.
Mr. Kennedy. Do you have an interest in that ?
Mr. Weber. I know nothing about it. I never heard of it.
Mr. Kennedy. You never heard of that company ?
Mr. Weber. Never heard of it, Mr. Counsel.
Mr. Kennedy. Would that be one of the companies in which some-
body just stuck your name in ?
Mr. Weber. I don't think so.
Mr. Kennedy. According to the records that we have reviewed, you
are a partner in Public Contracting Corp., which rents equipment
from S. A. Healy, amongst others.
Mr. Weber. Rents equipment from S. A. Healy ?
Mr. Kennedy. Yes.
Mr. Weber. I know nothing about that, Mr. Kennedy.
Mr. Kennedy. You don't know anything about that ?
Mr. Weber. No.
Mr. Kennedy. What do the records show ?
TESTIMONY OF ALPHONSE F. CALABRESE— Resumed
Mr. Calabrese. Information we have received is that stockholders
in the Public Contracting Corp. are identical with the ones in Public
Constructors, Inc.
Mr. Kennedy. You don't know anything about that ?
Mr. Weber. I don't know anything about it, Mr. Kennedy.
Mr. Kennedy. Would you tell what they do ; what their business
is?
Mr. Calabrese. Our information is that they are located physically
in the same office as Public Contractors, Inc. They also do construc-
tion work. They have rented equipment from S. A. Healy Co. That
is one of the things we have ascertained. This is in the investigative
stage at this point.
Mr. Kennedy. You don't know anything about that ?
Mr. Weber. Truthfully, no.
Mr. Kennedy. You might look into that company and find out ii
you have an interest and let us know.
Mr. Weber. If I do, I will.
Mr. Kennedy. Jersey Equipment Co. — wdiat have we found as far as
the income from Jersey Equipment Co. is concerned? Can you tell
us anything about wdiether you have gotten any income from renting
tliese cranes? Have you received any income from Jersey Equip-
ment Co. ?
Mr. Weber. Yes. It is on my statement, on the report.
8146 rJMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Do you want us to give it, and if it is incorrect, you
correct it?
Mr. Weber. Yes.
Mr. Kennedy. What do the records show?
Mr. Calabrese. Mr. Weber's income-tax return for the year 1956
indicates he received $2,000 from the Jersey Equipment Co., Haddon-
field,N.J.
The Chairman. Was that a dividend, or what was the purpose of it ?
Does it show?
Mr. Calabrese. That is what he received from the partnership.
The Chairman. Is it profit, or is it for work that he did ?
Mr. Calabrese. It is listed as income from partnerships, estates,
trusts, and others, and under partnership he lists the $2,000 item.
The Chairman. In other words, it would be investment income,
income from an investment?
Mr. Calabrese. Yes, sir.
The Chairman. It is not for salary ? It is not under that title ?
Mr. Calabrese. No, it is not.
The Chairman. Or for professional services rendered ?
Mr. Calabrese. No, sir. It is under income from partnerships.
The Chairman. All right. I would judge that to be from the
l^rofits of the partnership.
Mr. Kennedy. Do you have 1955?
Mr. Calabrese. Mr. Weber's income tax for the year 1955 shows,
under income from partnerships, this time listed under other sources,
Jersey Equipment Co., $2,502.09.
TESTIMONY OF JOHN PEINOS— Resumed
Mr. Kennedy. ^Vliat about 1957 ? Have you studied the books ?
Mr. Prinos. Yes. The checkbooks for Jersey Equipment Co. show
checks drawn to the name of Peter Weber, starting with January 9,
1957, $2,000; July 19, 1957, $3,000.
Mr. Kennedy. Just eive us the total for the year.
Mr. Prinos. That would be $9,000.
Mr. Kennedy. $9,000 for 1957?
Mr. Prinos. Yes.
TESTIMONY OF PETER WEBER— Resumed
Mr. Kennedy. Is there anything in the union reg-ulations or con-
stitution which prevents you from having an interest in a company
with whom your union has a contract, a union contract?
Mr. Weber. There is not.
Mr. Kennedy. Is that rather a common practice among the union
officials in the Operating Engineers ?
Mr. Weber. I don't know that, Mr. Kennedy.
Mr. Kennedy. Do you know other officials that have interests in
companies with whoni the Operating Engineers have a contract?
Mr. Weber. Not that I know of, offhand.
Mr. Kennedy. Are you familiar with Code No. 4: Conflict of Inter-
ests of the Ethical Practices Committee ?
Mr. Weber. To my knowledge, it means that any union official — I
haven't seen it. but it was explained to me — that is a major owner
IMPROPER ACTIVITIES IN THE LABOR FIELD 8147
or stockholder of any company that he does business with, is in
violation.
Mr. Kennedy. It says here, and I will read it to you, as I think it
is important
The Chairman. That is the ethical practices code ?
Mr. Kennedy. Yes, dealing with conflict of interest, passed January
31, 1957.
It is to plain for extended discussion that a basic ethical principle in the
conduct of trade-union affairs is that no responsible trade-union oflScial should
have a personal financial interest which conflicts with the full performance of
his fiduciary duties as a workers' representative. Obviously, an irreconcilable
conflict of interest would be present if a trade-union official, clothed with
responsibility and discretion for conducting the representation of workers,
simultaneously maintains a substantial interest in the profits of the employer
of the workers whom he is charged with representing, even though in a particular
instance there may be no actual malfeasance in the representation of the em-
ployees involved, the opportunity for personal gain at the expense of the welfare
of the employees whom the union official represents obviously exists.
It is quite clear, I think, Mr. Weber.
Mr. Weber. That can't involve our local union with the agreements
we have and the working conditions that we have and the wage
structure that we have.
Mr. Kennedy. You have a financial interest.
Mr. Weber. It said a major interest.
Mr. Kennedy. The financial interest that you have in this com-
pany, a one-eighth interest in that company, as well as the financial
interests that you have in these other companies, all of which com-
panies either employ Operating Engineers or do business with com-
panies that employ Operating Engineers, is obviously covered by this
provision of the ethical practices code.
Mr. Weber. I disagree with them under this instance. There isn't
a union in America that has an agreement specically protecting the
interests of the members that I represent, and that the companies that
I may have an interest in are the first ones that agree to an increase
in wages when an expiration date of our contracts come about.
So in that case, that stipulation does not apply to my position or to
the members of our union or to the companies that are in conflct, as
they state, with me as a stockholder.
Mr. Kennedy. It says on page 3 :
It is plain, as already stated, that a responsible trade-union official should
not be the owner in whole or in part of a business enterprise with which his
union bargains collectively on behalf of its employees. A conflict in such a case
is clear.
It seems clear to me, Mr. Weber.
Mr. Weber. Look at the contract. They have the same contract that
anyone has. It has to be proven that there is a conflict. I have never
had one ounce of responsibility toward those companies or my invest-
ment in those companies, as a stockholder, not as an owner, and any-
thing that I have ever done in my position as a business representatives
has always been, first, to my obligation to the members that I repre-
sent in all characters.
The Chairman. While not saying that you have or have not done
anything wrong, but as a matter of principle, of ethics, it manifestly
gives rise to a conflict of interest for an official of a trade union to
sign a contract with a company in which he, himself, has a financial
8148 IMPROPER ACTIVITIES IN TL"HE LABOR FIELD
interest. There is a conflict of interest. You are in the position of
duplicity where, on one hand, you sign a contract for the protection
of your union members and, on the other hand, you sign a contract for
the benefit of the company, or someone signs it for you, representing
the company.
I am not saying that there could not be instances, and there may be
instances, in which actually no fraud is done or perpetrated.
But the principle of it itself, according to the AFL-CIO code, is
unethical, and certainly it is a practice that cannot be condoned, be-
cause while one man may exercise such power honestly it does give
the opportunity to crooks and manipulators to exploit the union for
their own personal profit and advantage.
It is a practice that should be condemned, and, in my book, should
be prohibited.
Proceed.
Mr. Kennedy. Have you taken any steps to divest yourself of anj
of these companies in which you have these interest 'i
Mr. Weber. I have.
Mr. Kennedy. Wlien did you start taking those steps ?
Mr, Weber. Since the newspapers got into it, ]Mr. Kennedy. I
guess 2 years. Everyone has asked me would I like to sell an interest.
I tell them to go and talk to Mr. Fisher. I don't know if they have.
Mr. Kennedy. Have you sold any of your interests in any of these
companies ?
Mr. Weber. No; because you never know the actual value of it,
Mr. Kennedy.
Mr. Kennedy. You might have taken action in the last 2 years,
but you have not gotten around to selling any of the interests, is
that right?
Mr. Weber. No ; I haven't. I have been too busy.
Mr. Kennedy. I can see that.
Mr. Weber. I have.
The Chairman. Is there anything further ?
Mr. Kennedy. Do you get an automobile from the union, as well
as your salary and expenses?
Mr. Weber. The last 4 years, I think, we have been getting auto-
mobiles from the union. But previous to that I used to buy my own.
]\Ir. Kennedy. In the last 4 years you have been getting automo-
biles?
Mr. Weber. Yes.
JSIr. Kennedy. How many automobiles have you gotten in the
last 4 years ?
Mr. Weber. I think two.
Mr. Kennedy. Two automobiles have been purchased by the union ?
Mr. Weber. Yes.
Mr. Kennedy. What kind of an automobile do you have now ?
Mr. Weber. Right now ?
Mr. Kennedy. Yes.
Mr. Weber. I have a Chrysler, 1957.
Mr. Kennedy. That the union got?
Mr. Weber. No ; that is my own.
Mr. Kennedy. What does the union have for you ?
Mr. Weber. I am using, off and on, the extra car that the union
has. Once in a while I use that.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8149
Mr. Kennedy, Has the union purchased any automobile for you
in the last couple of years ?
Mr. Weber. Not this year, or not last year. I have taken over the
1956 automobile that the president had.
Mr. Kennedy. That has been turned over to you ?
Mr. Weber. It was turned over to me in 1956.
Mr. Kennedy. What did you do with the other automobile?
Mr. Weber. I turned that over to the recording secretary or finan-
cial secretary.
Mr. Kennedy. What kind of automobile is that ?
Mr. Weber. Cadillac.
Mr. Kennedy. Do you have a boat of your own, too ?
Mr. Weber. I do.
Mr. Kennedy. What kind of a boat is it?
Mr. Weber. Well, it is 20 years old, and it is a cruiser.
Mr. Kennedy. How big is it ?
Mr. Weber. Fifty-two-foot.
Mr, Kennedy, "\¥lien did you buy that ?
Mr, Weber. In 1950.
Mr, Kennedy, 1950?
Mr. Weber. Yes.
Mr. Kennedy. From whom did you buy it ?
Mr. Weber. From a Mrs. Brooks in California.
Mr. Kennedy. Who is Mrs. Brooks ?
Mr, Weber. She was the previous owner.
Mr. Kennedy. Did you know Mrs. Brooks before ?
Mr. Weber. Never met her in my life,
Mr. Kennedy. You didn't?
Mr. Weber. No.
Mr. Kennedy. How much did you pay for the boat ?
Mr. Weber. $17,500.
Mr. Kennedy. Was that by check or by cash ?
Mr, Weber. That was by check.
Mr. Kennedy, All of it by check, your own check ?
Mr. Weber. It was a certified check, I think.
Mr. Kennedy. A certified check?
Mr. Weber. Yes.
Mr. Kennedy. How did you get the certified check ?
Mr. Weber. Well, I got $5,000 from my brother, $5,000-^
Mr. Kennedy. By check or by cash ?
Mr. Weber. I don't know whether it was check or cash. But we
had to make out one check to Mrs. Brooks, I think.
Mr. Kennedy. Where did you get the rest of the money ? $5,000
from your brother ?
Mr. Weber. I had $5,000 of my own, and there was $7,500 by a
Mr. Brady.
Mr. Kennedy. Was your own by check or by cash ?
Mr. Weber. It could have been by check or cash, whatever I had,
Mr, Kennedy. Did you keep your money in a bank at that time ?
Mr. Weber. I never was close to a bank to keep my money.
Mr. Kennedy. So this is $12,000 in cash that you had ?
Mr. Weber. It could be, either by a check or by cash.
Mr. Kennedy, I know it could be by check or by cash. But was it
by cash ?
8150 IMPROPER ACTIVITIES IN THE LABOR FIEI^D
Mr. Weber. Whatever it was.
Mr. Kennedy. Would you keep $12,000 in cash at home?
Mr. Weber. No.
Mr. Kennedy. Where did you keep the cash ?
Mr. Weber. In the bank, I guess, if I had it in a bank.
Mr. Kennedy. But you don't know the answer to that, whether it
was check or cash ?
Mr. Weber. No, I do not.
Mr. Kennedy. Where did you buy the cashier's check ?
Mr. Weber. Either Union National Bank or Montclair Trust.
The Chairman. This car that you speak of that the imion furnishes
you, is it in the union's name ?
Mr. Weber. The extra car is, yes.
The Chairman. What about the other ones ?
Mr. Weber. Usually they are made out in the name of the person
that is responsible for them.
The Chairman. In other words, the cars are bought and given to
you ?
Mr. Weber. It is not given. It is only for the use of the repre-
sentatives or myself or any of the officers of the union.
The Chairman. And the expense of operating the car, to whom
is that charged ?
Mr. Weber. The expense of operating the car ?
The Chairman. Yes.
Mr. Weber. The union supplies the expenses.
The Chairman. Your operating costs ?
Mr. Weber. That is right.
The Chairman. That is in addition, then, to the other expenses
you get ?
Mr. Weber. No, it is not. That is a part of the expense.
The Chairman. You pay it, then, out of the expense ?
Mr. Weber. Out of the expense that is allocated to us.
The Chairman. And the operating expense is not charged to the
union and paid for in addition ; is that correct ?
Mr. Weber. That is correct. Senator.
The Chairman. Senator Ervin.
Senator Ervin. On several occasions, we have received information
in this committee indicating that people holding positions of authority
in unions were sitting on one side of the bargaining table representing
the members of the union, and also having contracts at the same time
with the people sitting on the other side of the bargaining table
involving the work in which they were supposed to represent the
imion. I do not know whether these cases come under the ethics
setup by the AFL-CIO, but I do know that they are condemned by
an ethical standard that was written into the Bible at least 2,000 years
ago, which says that no man can serve 2 masters. No labor leader
ought to permit liimself, or any other human being, to be in a position
where he can be charged with occupying a dual position.
I am not passing any judgment on you, Mr. Weber, but it is very
suspicious, when the man who represents labor on one side is engaged
in business with the very people who are employing the labor that
he represents and the people he is supposed to protect at the bar-
gaining table.
IMPROPER ACTlN^ITIEb IX THE LABOR FIELD 8151
Bat I am not passin<y judgment on any one individual case.
It appears here from this testimony that Mr. Fay was charged with
conspiring to extort money from contractors, and with extorting
money from contractors. Certainly you do not contend that if he was
guilty of the charge preferred against him that he was acting in
behalf of the union in committing the alleged acts, do you ?
I will put it another way.
It ai^pears here from this evidence that Mr. Fay was tried and
convicted upon a bill of indictment charging him with conspiring to
extort money from contractors for his own benefit, and with actually
extorting money for his own beneiit.
You do not claim as an officer of your miion that he could possibly
be doing those things for the beneiit of the union, do you ?
Mr. Weber. To protect the men on the job where the situation was
involving him was a matter of protecting the work of over 1,100 men,
where a union, communistically inclined, was tiying to destroy the
employer who was working on those jobs, and the members of our
union was working for, and the moneys were paid to pay the pickets
to counterpicket this Commie union.
Senator Ekvin. Then you contend, not making it applicable to
Mr. Fay, but just generally, you contend that a labor leader can go
out and practice extortion and in so doing be acting for the benefit
of the union?
Mr. Weber. I don't say that, Senator. But the issues were brought
up before the members of our union. Pickets were there working on
the job. Pickets were receiving compensation so that they could go
and get something to eat, and they used their automobiles.
Senator Ervin. I cannot understand as a lawyer how it was in
this individual case where a person, even though he has a high rank
within the union, who has a position of authority, w^ho is charged with
committing a criminal offense, w^hich cannot possibly fall within the
scope of his duties to the unioii — I cannot understand why it is that
the union takes its money and defends him upon that criminal charge
which cannot possibly arise out of any legitimate act done by him in
the scope of his authority as an officer of the union.
Yet it appears here that this union used at least $6,300 of its money
to defend Mr. Fay upon the charge that he had done something
which could not have had any proper or legitimate relation to any-
thing that he was authorized to do for the union.
How do you justify using union funds in that manner %
Mr. Weber. The issue was brought up before the members. There
was no money in the union at that time. We just got through a ter-
rific depression. No union had any money to finance a fight against
anyone. The contractors were the ones that contributed the money
tow^ard the picketing to pi'otect themselves from this communistically
inclined union that was trying to put 1,100 men out of work.
If you mean to tell me that because Mr. Fay got into these diffi-
culties— it was only for the purpose that he was carrying out the
duties of his job, as was explained to the members of the union.
The Chairman. Did that money that Mr. Fay received go into the
union treasury %
Mr. Weber. No, sir.
The Chairman. If it belonged to the union and was for the benefit
of the union, should it have gone into the union treasury ?
8152 IMPROPER ACl'IVITIES IN THE Ll\BOR FIE-LD
Mr. Weber. Well, there was hundreds and hundreds of pickets
there, and all of that money, Senator
The Chairman. That is another way of getting b}' good bookkeep-
ing- and proper accounting of union funds. If that money was paid
legitimately, to help the union in defense of its position against an-
other union or against Communists, or anything else, should not that
money have gone into the union treasury and be accounted for ?
]Mr. Weber. At that time, there were several unions involved, team-
sters, laborers
The Chairmax. I don't care if there are a hundred involved. Each
one should have a proper accounting of any money contributed to them
by management, should they not ?
Mr. Weber. I don't know anything about that.
The Chairmax. Apparently you are trying to justify the expen-
diture of all of this union money to defend Mr. Fay on the basis that
his acts were in service of the union.
Mr. Weber. Wasn't that tried in the Tax Courts ?
The Chairman. I don't know about that.
Mr. Weber. Well, I think it was.
The Chairman. I am not talking about court or no courts.
Mr. Weber. I think the Tax Courts have all the information that is
necessary, which I don't have, and how it was expended, and how it
was paid. I don't know anything about that. It was in the Tax
Courts, Senator.
The Chairman. I understand. But now you say you do not know
anything about it.
Mr. Weber. I don't know how it was paid. I don't know how it
was distributed. The only thing I know is that the Tax Courts have
exonerated Mr. Fay.
The Chairman. We have not gotten to the Tax Court yet. What I
am saying is money paid by management for the benefit of the union
and for the use of the union to further its cause, to make a contribution
for that purpose, should not that money go into the treasury and be
properly expended and accounted for life any other funds I Since it
wasn't, you say now you don't know how much money it w;is, or what
was done with it. You don't know how it was expended.
Mr. Weber. I know what was done with it, but I don't know how it
was expended. It was given to men that were on the picket line.
The Chairman. All of it?
Mr. Weber. It is all according to the tax case.
The Chairman. We are not talking about the tax case. AVe are
talking about the money paid in there that justified your union paying
out $6,300 to defend Mr. Fay for his acts.
Mr. Weber. The only thing I know is that whatever was done by
the union was done at an election. It was a legitimate meeting. It
was transacted properly. It is a matter of record. The only thing
that I can speak about is on the record.
The Chairman. What part of that money is a matter of record ?
Mr. Weber. Whatever was expended in behalf of the defense of Mr.
Fay. .^i
The Chairman. I understand that. That is probably a matter of
record; yes. But I am talking about money coming under the charge
of extortion. If it is in the interest of the union, I cannot understand
IMPROPER ACTIVITIES IN THE LABOR FIELD 8153
Avhy it sliould not go into the union treasury and be expended in accord-
ance with the other expenditures of the union, and be expended in the
same manner.
Senator Ervin. AYhat you overlook is that there was a jury in New
York that heard the char^-e against Mr. Fay, and under the charge he
was charged with practicing extortion for his personal enrichment. _ I
would like to know under those circumstances how you can justify
taking union money to defend the man upon the charge of practicing
extortion for his personal enrichment and not for the benefit of the
union.
Mr. Weber. Well, the members don't feel that way.
Senator Ervin. Well, on the members in this union, the evidence
indicates that the membei's of this union usually did Avhat the officers
suggested that they do. This was suggested, I notice, by tlie board,
which comprises the head men who control the union.
Also, they said in this resolution, or part of it, in one paragraph,
that Mrs. Fay, as a confidential secretary, has done an outstanding
job for the local union, and we have not been able to find out from a
single witness a single thing she ever did.
That is all.
The CHAiR:MA>r, Is there anything further ?
Mr. Kennedy. Do you know a Mr. Leslie, of local 825 ?
Mr. Weber. He is one of my representatives.
Mr. Kennedy. Steve Leslie ?
Mr. Weber. He is.
Mr. Kennedy. Do you know if he has interest in any companies?
Mr. Weber. No; I do not.
Mr. Kennedy. You don't know of any other outside income that he
has?
Mr. Weber. I do not,
Mr. Kennedy. You have no information on that whatsoever ?
Mr. Weber. I do not.
Mr. Kennedy. Have you ever heard a rumor that he has ?
Mr. Weber. I guess I did.
Mr. Kennedy. What kind of a company did you hear that he had
an interest in ?
Mr. Weber. I don't know. He had an interest in a boat or so.
Mr. Kennedy. Was that the boat that was ferrying the operating
engineers over to their work ?
Mr. Weber. It could be, working in conjunction with dredging
operations.
Mr. Kennedy. So he is a business agent of the local that has a boat
that ferries the Operating Engineers to their work, is that right?
Mr. Weber. I stated, Mr. Kennedy, I didn't know.
Mr. Kennedy. Is that what you heard ?
Mr. Weber. That is w]iat I heard, that he had a boat or something
of that sort.
Mr. Kennedy. And that he was ferrying the Operating Engineers
across to their work ?
Mr. Weber. Not that. I said I heard that he had a boat.
Mr. Kennedy. Not just a boat like you have a boat, but a boat that
did some work. Didn't you hear tliat ?
Mr, Weber. Yes, I guess it could be that he had a work boat. It
could be a tug or something.
8154 I.M PROPER ACTIVITIES IX THE LABOR FIELD
Mr. Kennedy. Did you hear that the work boat carried Operating
Engineers ? Did you go that one step further ?
Mr. Weber. No.
Mr. Kennedy. Wliere did you understand he had the work boat ?
Mr. Weber. Well, I know when we were organizing the dredging,
and that is going back since 1940, if we could not get to the dredge to
talk to the men we would have to swim to it, because we couldn't get
any boats to take us over to the dredge.
Mr. Kennedy. So how does that fit into this ?
Mr. Weber. That is probably how he got into a boat.
Mr. Kennedy. Mow you got him into a boat that carries the Op-
erating Engineers ; is that right ?
Mr. Weber. I don't Imow.
Mr. Kennedy. You told me this story that you couldn't get to the
dredges.
Now somebody has a boat. I presume the boat is to take the Operat-
ing Engineers to the dredges.
Mr. Weber. That is the reason he got the boat from the inception.
Mr. Kennedy. So this is the boat that takes the Operating Engi-
neers to the dredges ?
Mr. Weber. I do not know. I told you I didn't know, I said, as
you asked, did I hear, and I said yes, I did hear, but I didn't know.
Mr. Kennedy. But you heard that was the kind of a boat he had?
Mr. Weber. A work boat.
Mr. Kennedy. Did you inquire into that, too ?
Mr. Weber. No.
Mr. Kennedy. You are not interested? You don't see that there
is a conflict of interest there ?
Mr. Weber. The only thing I am interested in is that the proper
conditions of the men are taken care of. I have had no complaints
about Mr. Leslie from anyone. His personal affairs are not my affairs.
Mr. Kennedy. The ethical practices code applies to that also, but
you are not going to make any inquiry into it to find out what the
story is ?
Mr. Weber. I will have to find out now, Mr. Kennedy.
Mr. Kennedy. Will you make an inquiry into it ?
Mr. Weber. I will.
Mr. Kennedy. You will.
Mr. Chairman, we have made a study of what Mr. Fay has received
from the union for which he has done no work.
Mr. Mundie has made a study of how much would have to be paid
into a fund in order to achieve a pension of some $12,000 a year.
The Chairman. You are talking about Mr. Fay ?
Mr. Kennedy. Yes.
The Chairman. Are you through with Mr. Weber ?
Mr. Kennedy. Yes.
The Chairman. You may stand aside.
Mr. Mundie, do you solemnly swear that the evidence you shall give
before this Senate select committee will be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Mundie. I do.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8155
TESTIMONY OP JAMES MTJNDIE
Mr. Webek. Thank you, o:entlenieii, tliank you very much.
The CiiAiK^kiAX. Mr. Munclie, state your name.
Mr. MuNDiE. My name is James Mundie.
The Chairman. Are you a member of the staff on loan from what
department of Government ?
Mr. Mundie. United States Treasury Department.
The Chairman. All right. Proceed.
Mr. Kennedy. Mr. Mundie, have you contacted an insurance coni-
pany to determine how much money would have to be paid by an indi-
vidual in order to achieve at the age of approximately 65 a pension
of some $12,000 a year?
Mr. Mundie. I have.
Mr. Kennedy. Could you tell us what figures they gave you as to
what would have to be paid by the individual in order to get such a
pension ?
Mr. Mundie. At the age of 35, with 30-year payments, to receive
a pension of $1,000 a month at the age of 65, the cost of this would be
$4,500 a year, and in 30 years it would be $135,000, and with dividends
to discount it would be a total of $105,000,
Mr. Kennedy. You would have to invest $105,000 ?
Mr. Mundie. That is correct.
Mr. Kennedy. Over a 30-year period. Of course, the $30,000 —
you deducted $30,000?
Mr. Mundie. Yes; for discount purposes.
Mr. Kennedy. But that would tie up this amount of money during
this period of time ?
Mr. Mundie. Yes.
Mr. Kennedy. That would be $105,000 that it would cost the indi-
vidual ; is that right ?
Mr. Mundie. That is correct.
Mr. Kennedy. Mr. Chairman, the total of $105,000, plus the $63,000
of legal fees, gives us a total of $168,000, plus approximately $3,000
for Mrs. Fay's car, which takes it up to a total of $171,000, plus $67,800
for Mr. Fay's salary, taking it up to $238,800, minimum for Mr. Fay
since he was found guilty of extorting $63,000.
The Chairman. Since he was found guilty ?
Mr. Kennedy. Yes ; since he was found guilty of extorting $63,000.
The Chairman. Is there anything further?
Mr. Kennedy. Yes.
The Chairman. Call the next witness.
(Members of the select committee present at this point in the pro-
ceedings were Senators McClellan and Ervin.)
Mr. Kennedy. Now, Mr. Chairman, we get into a transition here.
We have gone into Philadelphia where there was some testimony on
a contractor called S. A. Healy, and the fact that Mr. William E.
Maloney asked Mr. Underwood to give Mr. S. A. Healy certain favors.
In addition, according to the records when Mr. Fay was indicted,
Mr. S. A. Healy was a prospective witness. He appeared before the
grand jury, and one of the counts of the indictment involved Mr.
Healy.
Mr. Healy then went out to Illinois, according to Mr. Hogan's re-
port, and refused to come back and testify in the trial. It was impos-
8156 IMPROPER ACTIVITIES IN THE LABOR FTEI.D
sible to get him back because there was no reciprocity between New
York and Illinois at the time. Mr. Healy then w^ent down to Florida,
and he was served with a subpena down there by the district attorney
to come back to New York.
He left the district in Florida and went back to Illinois, and still
refused to come to New York. So the result was that he did not
testify in the trial.
I would like to read, Mr. Chairman, what Mr. Hogan stated about
Mr. Healy.
The Chaieman. Now, this is just a preliminary statement to show
what you are trying to cover ?
Mr. Kennedy. That is correct; and it is showing that Mr. Healy
is an important witness in the transition from what we have been
going into, in the affairs of William E. Maloney.
The Chairman. This is a transition period from the locals into
the international ?
Mr. Kennedy. Into the international; and Mr. William E.
Maloney's control over the two Chicago locals, and the important
effect that these locals can have over the business of Mr. Healy.
The Chairman. Those are the two that are in trusteeship ?
Mr. Kennedy. Yes.
Mr. Hogan spoke of another witness who jumped the jurisdiction,
a contractor, and refused to come back and testify, and he goes on to
say:
Another example of good citizenship was presented by Stephen A. Healy, of the
S. A. Healy Co., of Chicago, 111. Mr. Healy does a great deal of business with
the Government. He is a powerful citizen in Chicago ; recently bought the
Stevens Hotel. For over a year Healy refused to come into this jurisdiction..
Illinois, unfortunately, is a State where there is no reciprocal witness statute,
and all the law-enforcement authorities of this county could do was to beg him
to be a good citizen and to come in here, and to urge his attorneys to so persuade
him. He stood out there and ignored us.
F'nally he elected to slip off to Florida and we were successful enough in
grabb'ng him in Florida. He put up bail and jumped bail and went back to
Illinois.
After a year and a half, and not until December of 1943, did he come into-
this jurisdiction. Then he had a very fancy story indeed. Your Honor. Yes,
he Iv^d paid money, and he paid $125,000. "Did you have conversations with
Fay?" "No, never talked to him; was on the job, never talked to Fay or
Bove." "Well, did anybody threaten you?" "Yes, I did get threats." "From
who?" "Charles Shea." "What his happened to Shea?" "Well, he is a con-
tractor, and he died." "Did you pay any money?" "Yes, I paid money." "To
whom?" "Mike Carrozo." "Who is Mike Carrozo?" "He is an associate of
Al Capone, and a very good friend of the president of the Operating Engineers,
Mr. Malon(^y" — who probalily has sent a letter and a testimonal with respect
to the greatservice that this man Fay has done for labor.
But that is the type of witness that we had to deal with, and I say that the^
witnesses in this case — their action in actually coming forward when there was
great pressure on a good many of them — he urged Killmer not to come here at
all : a representative of his went to MacDonald and said : "Jack, spare me as
miich as you can. Do what you can for me."
That was a summary of the trouble and the difficulties the district
attorney had with Mr. Healy, and the problem.
Is INIr. Healy in the room? I would like to ask Mr. Calabrese to
testify as to the relationship, business relationship between Mr. Healy
and Mr. Maloney, that we know of, and from what the records show.
The Chairman. Will you take the witness stand, Mr. Calabrese.
Is Mr. Healy present ? All right, you may remain and listen to this
testimony, because you will be interrogated about it.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8157
TESTIMONY OF ALPHONSE F. CALABRESE— Eesumed
The Chairman. You have been sworn. Will you proceed.
Mr. Kennedy. Now, Mr. Calabrese, you have made a study of
some of the records of Mr. Healy that have been made available to
us?
Mr. Calabrese. 1 have.
Mr. Kennedy. And also the records of other individuals'?
Mr, Calabrese. Mr. Maloney, yes.
Mr. Kennedy. Could you tell us if Mr. Healy and Mr. Maloney
have been in any kind of business together?
Mr. Calabrese. Yes, I was able to ascertain from the examination
of records in another investigation that Mr. Healy, and Mr. Maloney,
and Mr. Orville Soucie, who is now serving time in Terre Haute Fed-
eral Penitentiary for extortion
Mr. Kennedy. What w^as his position?
Mr. Calabrese. He was president of the local union in Terre Haute,
Ind., of the International Union of Operating Engineers.
Mr. Kennedy. He is now in prison convicted of extortion?
Mr. Calabrese. That is correct.
Mr. Kennedy. Go ahead.
Mr. Calabrese. These three were in oil-well ventures in the State
of Indiana in the year of 1951.
The Chairman. What is that?
Mr. Calabrese. Oil-well ventures.
' The first venture, which was an oil w^ell described as the Ziegler
well, was a well in Davis County, Ind. It was entered into in the
early part of 1951. The oil-production man, a party by the name of
Walter Cook, Jr., who had offices in Terre Haute, Ind., interested
Mr. Soucie, who was an associate of his, and who also lived in Terre
Haute, Ind., in an oil-well venture, as I mentioned before, described
as Ziegler well.
. He asked Mr. Soucie if he could get $15,000 for this investment.
Soucie stated that he had some friend, and he would find out, but he
had to go to Miami to an executive board meeting. Soucie at this
time was international trustee of the International Union of Operat-
ing Engineers.
The Chairman. Of that local up there and not of the whole inter-
national ?
Mr. Calabrese. He was president of the local, and trustee of the
whole international, yes.
The Chairman. Was all of the international in trusteeship?
Mr. Calabrese. There are three trustees that go over the books of
the international.
The Chairman. I see.
Mr. Calabrese. Mr. Soucie went to Miami and interested Mi*. Ma-
loney, the international president of the lUOE, and according to Mr.
Soucie, whom I interviewed in the Federal penitentiary last Novem-
ber, Mr. Healy happened to vralk into the home of Mr. Malojiey in
Miami Beach, and at that time Mr. Healy became interested in it.
T!\ereafter, each put up $5,000 and Soucie opened a bank ;u'count
in th'^ name of M. H. & S. Associates. O. R. Soucie, at the Bloom-
field S ate Bank, in Bloomfiold, Ind, Tliis was on February 5, 1951.
21243— 58— pt. 20 16
8158 IMPROPER ACTIVITIES IX THE LABOR FIEI.D
I have photostatic copies of checks that were sent to Mr. Soucie, one
from Mr. William E. Maloney, dated January 31, 1951, payable to
O. B. Soucie, in the amount of $5,000, drawn on the American Secu-
rity & Trust Co., of Washington, D. C, and signed "William E.
Maloney."
The Ci-iAiRMAisr. Is that on union funds or personal funds i
Mr. Calabrese. This w^as his personal check.
The Chairman. That will be made exhibit Xo. 84.
(Document referred to was marked "Exhibit No. 84" for reference
and will be found in the appendix on p. 8310.)
Mr. Calabrese. I have also a check dated January 24, 1951, made
by the S. A. Healy Co., in the amount of $5,000 payable to P. O.
Soucie. Now, there is a typographical error. This was endorsed by
Mr. Soucie and put in that bank account.
The CiiAiRMAiSr. That may be made exhibit No. 85.
(Document referred to was marked "Exhibit No. 85"' for reference
and will be found in the appendix on p. 8311.)
Mr. Kennedy. If it becomes necessarj^ we can go into these details.
But what I would like you to do is just a summary of the venture,
and what they were called, and what happened. Just give us the
bare outline of the facts involved in the two or three deals in which
they were in together.
Mr. Calabrese. As a result of this venture, there was a dry hole.
They lost everything of the $15,000, with the exception of $1,994.95,
which each person obtained.
Mr. Kennedy. They were in one business together ; Healy, Maloney
and Soucie were in one business venture together back in 1950.
Do you have them in another business ?
Mr. Calabrese. We have a second one.
Mr. Kennedy. Just give us a bare outline of the facts. They went
into business together, is that right ?
Mr. Calabrese. This is another oil well venture, called the Mans-
field well. Here Mr. Healy issued a check — I will correct that. Thb
S. A. Healy Co. issued a check in the amount of $18,000_ dated May
10, 1951, in return they received three-quarters interest in a royalty
right on the Mansfield well.
From the records that Mr. Healy made available, and Mr. Maloney
made available, w^e ascertained that Mr. Maloney had one-third in-
terest and paid $6,000, and that Mr. Soucie had one-third interest, and
he also paid $6,000.
This well also resulted in a failure and it was a dry hole.
Mr. Kennedy. That is what we know on the record as to their
business interests together ?
Mr. Calabrese. That is correct.
Mr. Kennedy. That is on the record, is it?
Mr. Calabrese. That is correct.
Mr. Kennedy. Now, I would like to call Mr. Healy, and ask him
about what other financial transactions they have had, other than
these deals.
The Chairman. Mr. Healy, come around, please.
Will you be sworn?
IMPROPKR ACTIVITIES IX THE LABOR FIELD 8159
Do you solemnly swear that the evidence, given before tliis Senate
select committee shall be the truth, the whole truth and nothing but
t he truth, so help you God ?
Mr. He ALT. I do.
TESTIMONY OF STEPHEN A. HEALY, ACCOMPANIED BY HIS
COUNSEL, JACOB GRUMET
The Chaikmax. Will you state your name, your place of residence
and your business or occupation.
Mr. Healy. Stephen A. Healy, Kingsdale, 111., contractor.
The Chairman. You will have to speak a little louder, Mr. Healy,
To expedite this matter, you have counsel representing you ?
Mr. Healy. Yes, sir.
The Chairimax. Counsel, identify yourself for the record.
Mr. Gruuiet. Jacob Grumet, member of the New York bar, and
office at 233 Broadway, New York City.
The Chairman. Proceed.
Mr. Kennedy. You are in the contracting business ?
Mr. Healy. Yes, sir.
Mr. Kennedy. And how long have you been in the contracting
business?
Mr. Healy. About 35 years.
Mr. Kennedy. And you operate under the name of S. A. Healy Co. ?
Mr. Healy. That is right.
Mr. Kennedy. Do you have any other companies which you oper-
ate under in the contracting business ?
Mr. Healy. No.
Mr. Kennedy. Do you know Mr. William E. Maloney l
(At this point witness consulted with counsel.)
Mr. Healy. I refuse to answer on the ground that my answer may
tend to incriminate me.
Mr. Kennedy. How long have you known
The Chairman. Just a moment. What was the question, if he
knew Mr. Maloney ?
Mr. Kennedy. That is correct.
The Chairman. You decline to answer on the ground that ac-
knowledging you knew ]\Tr. IVIaloney might tend to incriminate you;
is that your statement ?
Mr. Healy. Yes, sir.
The Chairman. All right ; proceed, Mr. Counsel.
yiv. Kennedy. Can you tell us how long you have known Mr.
Maloney ?
Mr. Healy. I refuse to answer on the same grounds.
The Chairman. I think it would be a little more respectful of the
committee, and I think that you may w^ant to do that, to say that you
decline to answer instead of refusing.
Proceed.
Mr. Kennedy. Have you had any business dealings
; Mr. Grumet. He probably does not know the exact form, and he
does not mean to be disrespecf f iil to the committee.
The Chairman. I did not think that he did, but going out over
the airways, it might sound })etter for him to say that he respectfully
declines rather than refuse.
8160 IMPROPER ACTIVITIES IN THE LABOR FIE'LD
Mr. Grumet. I agree with you.
Mr. Kennedy. Have you had any business dealings with Mr.
Maloney other than those described already before the committee?
Mr. Healy. I decline to answer.
Mr. Kennedy. On what grounds ?
Mr. Healy. The same grounds.
Mr. Kennedy. Which are what ?
Mr. Healy. That it may tend to incriminate me.
The Chairman. If you want to take the fifth amendment on all
of these questions, it is your privilege, of course.
Mr. Healy. I can't hear you now.
The Chairman. What is that ?
Mr. Healy. I can't hear you.
Mr. Grumet. He has difficulty in hearing.
The Chairman. I will try to reach you. Does that reach you ?
Mr. Healy. Yes, sir.
The Chairman. All right, proceed.
Mr. Kennedy. Mr. Healy, have you had any other business dealings
with Mr. William E. Maloney, other than those described here by
the committee?
Mr. Healy. I decline to answer that also.
Mr. Kennedy. On the ground it might tend to incriminate you?
Mr. Healy. Yes, sir.
Mr. Kennedy. Have you made any payments of any kind to Mr.
William E. Maloney?
Mr. Healy. I decline to answer that also. On the same ground.
Mr. Kennedy. Is it not a fact that local 150 in Chicago is the local
that has the greatest control over your operations?
Mr. Healy. I decline to answer that also.
Mr. Kennedy. Is it not a part of the arrangement between you and
Mr. Maloney that local 150 will be kept in trusteeship so that he can
have control over its affairs?
Mr. Healy. I decline to answer that also.
Mr. Kennedy. Have you not had discussions with Mr. William E.
Maloney on that?
The Chairman. I know the witness has a little handicap, and he
just declines to answer. Just declining to answer is not a justification
for refusing to answer. The witness has counsel present, and the
Chair is going to require that the witness meet the requirements. We
want a record made, and just to say he declines to answer is not suffi-
cient. That is not an excuse and it will not excuse the witness for
not answering.
Mr. Grumet, The witness is just anxious to have the record clear
and will give a full statement.
The Chairman. I always assume when counsel is present, he will so
advise the witness of his rights and so forth, and I do not like to inter-
ject this, but I am assuming that the witness intends to take the fifth
amendment all of the way through, and therefore I want the record to
show it, that he is taking it on that basis, or, if he is not, then the
Chair will order the witness to answer these questions and we will
proceed on that theory.
Mr. Grumet. Let the record show that up to this point, his declining
to answer was based on the fifth amendment.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8161
The CiiAiRMAX. The Chair will o-raiit that request in order to
expedite the proceeding. Hereafter, however, when he is asked ques-
tions, I expect the witness to be able to answer in accordance with his
purpose, if he has that purpose, to protect his rights against self-
incrimination. There are many questions we would like to ask this
witness, and maybe we can ask some that he won't decline to answer on,
and I am hopeful, because I want to say at the outset, that this is a
businessman.
AVe have had people here in the labor movement before us, some
members, and some otHcials who had a duty and an obligation to give
an accounting of their stewardship as officers representing hard-work-
ing people who pay dues into their organization. They took the fifth
amendment, and that may be a privilege that they have a right to
exercise.
But then when we get business people before us, you have a right
to expect and hope at least that a businessman could give an accounting
of his transactions with labor leaders. It is a very unhappy situation
for the country when the men who are big contractors, doing millions
of dollars worth of business in this country and working people and
labor union members and others, cannot give an accounting of their
transactions with the labor leaders who are supposed to be representing
the union men that are paying the dues.
We do not know. All we can do is proceed to bring them here. But
it is a kind of a sordid picture from where I look at it.
Proceed.
Mr. Kennedy. Kee}) in mind that Healy has already admitted dur-
ing the 1940's that he paid $125,000 to another union official.
The Chairman. Ask him about it.
Mr. Grumet. May I say something at this point ? It is very difficult
for a witness under these circumstances, sometimes, to determine just
where he may oj^en the door to self-incrimination.
The Chairman. I appreciate that.
Mr. Grumet. And therefore he may be compelled to take the
privilege throughout.
The Chairman. I appreciate that, too, and so proceed, Mr. Kennedy.
But it is our duty to ask the questions, if we have the information
upon which to justify the questions in an inquiry of this kind, and
apparently from the records we ha-ve that basis, and justification.
Proceed, Mr. Kennedy.
Mr. Kennedy. Have you in fact admitted that you paid $125,000
to Mr. Carrozo ?
Mr. Healy. I decline to answer that on the ground it may incrim-
inate me.
Mr. Kennedy. That was during the 1940 's was it not, Mr. Healy ?
Mr. Healy. I decline to answer.
Mr. Grumet. I think that you are going back about 20 years, isn't
that it?
Mr. Kennedy. During the 1940's, he can answer the question. Did
you admit that you had paid $125,000?
Mr. Healy. I decline to answer on the ground that it may tend to
incriminate me.
(At this point, the following members were present: Senators Mc-
Clellan and Mundt.)
8U)2 liMPROPER ACTIVITIES IX THE LABOR FlEl^D
Mr. Kennedy. Mr. Healy, the key to this situation is this local 150
in Chicago. Could you tell us what conversations you have had with
Mr. Maloney about that local ?
Mr. Healy. I decline to answer on the ground that it may tend to
incriminate me.
Mr. Kennedy. We had testimony before the committee from a rep-
resentative of the Philadelphia local, who told us that he was told by
William E. Maloney on two separate occasions to lay off on work that
you were doing, not to try to unionize or organize the employees.
Would you make any comment on that ?
(Witness conferred with counsel.)
Mr. Healy. I decline to answer on the ground that it may tend to
incriminate me.
Mr. Kennedy. Mr. Chairman, we have made a review of the books
and records of Mr, Healy. I would like to have him testify to them.
Would you make any comment about your books and records, Mr.
Healy, regarding the use of any of the money that is listed there as
being spent ?
Mr. Healy. I decline to answer on the grounds that it may tend to
incriminate me.
The Chairman. Just a moment. I want to ask you a question or
two. Some of the testimony before this committee clearly indicates
that you were a favored contractor, and that you got special favors
from the Operating Engineers Union, its international and some of
its locals . In other words, that they didn't enforce the contract against
you, whereas they might against other contractors.
Do you wish to make any statement about that ?
Is it true or false ?
Mr. Healy. I decline to answer on the same reason, that it may tend
to incriminate me.
The Chairman. Would it be fair to say that you have been in collu-
sion with the international president of the Operating Engineers Inter-
national Union, and, thus, by exchange of favors you have benefited
him to his profit, to his personal gain, and that in return he has shown
favors to you as a contractor, a labor employer, with his organization,
and, thus, you have also profited ?
Mr. Hkaly. I decline to answer on the ground tliat it may tend to
incriminate me.
The Chairman. Have your relations with him, dealing with him
as a union official of an international union, been mutuall}' profitable
between you?
Mr. Healy. I decline to answer on the ground that it may tend to
incriminate me.
The Chairman. Mr. Healy, do you feel any sense of obligation and
responsibility as a businessman in this comitry and a large contractor,
taking contracts, Govermiient contracts and others, do you feel any
sense of obligation to the American public to make a franlc statement
about these relationships that cast suspicion upon you ?
Mr. Healy. I decline to ansAver on the grounds that it may tend to
incriminate me.
The Chairman. You don't say that you have or do not have any
sense of obligation, as I understand it ?
Mr. Healy. I decline to answer on the same grounds.
The Chairman. Senator Mundt ?
IMPROPER AC'IIVITIES IX THE LABOR FIELD 8163
Senator Mundt. Mr. Healy, I share with the chairman a sense of
shock that yon shonld decline to answer questions about your activi-
ties. This is a rather saddenino- experience. It is pretty hard for me
to believe that all of your experience as a businessman and as a big con-
tractor has been of the type that you would have to shield behind the
fifth amendment. You, of course, are a better judge of that than I am.
But I would like to ask you something of the nature or the kind of
construction work in which you have been engaged for many years.
Were you a contractor for the Chicago subway system ?
(Witness conferred with his counsel.)
Mr. Healt. I decline to answer on the ground it may tend to in-
criminate me.
Senator Mundt. Are you sure you understood the question? I
simply asked you whether you were a contractor involved in the con-
struction of the Chicago subway system.
Do you decline to answer that question on the fifth amendment ?
Mr, Healy. Yes.
Mr. Grumet. As I said before. Senator, it may open the door
Senator Mundt. Wait a minute. This is not a question of opening
the door. This is a question of whether or not the witness has any-
thmg to shield because he was a contractor on the subway system. I
don't know.
Mr. Gruiniet. This may be a preliminary question to other questions
which will follow.
Senator Mundt. Certainly, and when a question follows which in-
volves a sense of guilt on his part or a sense of peril, I expect him to
take the fifth amendment. If there is involved some corruption here
that I don't know about, I am expecting him to take the fifth amend-
ment. If there is not, I expect him to be cooperative to the United
States Senate. I asked him simply the question of whether he had
contracts involving the Chicago subway system.
Mr. Grumet. But may I say it is difficult to know Avhere to draw the
line, even under the cases I have read.
Senator Mundt. There is nothing difficult here. If there is nothing
to hide, it is not difficult to hide.
I do not have evidence before me of corruption in this contract, but
maybe we are missing a bet. But the witness' response indicates to
me we ought to get busy with the investigators, as we may have missed
something. I am asking a question in good faith to try to determine,
as I hope we can, that at least some of this activities represent a gen-
tleman, and did not involve any bribery, any corruption or anything
else. I will ask him the simple question of whether or not his com-
pany did participate in the construction of the Chicago subway
system.
If you insist on taking the fifth amendment on that question, that
is up to you. You may have reasons that I know nothing about. I
am certainly not going to try to jeopardize your constitutional rights.
But you surely arouse in the minds of millions of Americans a great
suspicion if you do take the fifth amendment on a question of that
type.
(The witness conferred with his counsel.)
Mr. Healy. I decline to answer on the ground it may tend to in-
criminate me.
8164 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Mtjndt. Were you one of the contractors involved in the
New York City-Delaware water project?
Mr. Healy. I decline to answer on the grounds it may tend to in-
criminate me.
Senator Mundt. Were you one of the contractors on the Chicago
water contract ?
Mr. Healy. I decline to answer on the ground it may tend to in-
criminate me.
Senator Mundt. Let me give you a chance, Mr. Healy, to say some-
thing for yourself, which could put you, at least, in a somewhat
better light, than the black picture you are painting with your own
brush at this time.
In your many long years as a contractor, have you ever had a
Government contract with the United States Government, which was
faithfully carried out and of which you are proud, and of which you
can say ""Well, on this one I am happy to sav I helped build so and
so"(
(The witness conferred with his counsel.)
Senator Mundt. I know you have had some Government contracts.
I want you to pick one out of which you are proud, that will bear out
under any investigation we might want to make, if there are any,
(The witness conferred with his counsel.)
Mr. Healy. I decline to answer on the gi'ound it may tend to in-
criminate me.
Senator Mundt. You can't think of one that you can point to and
say, "Well, this one is clean. You can go to it; there is nothing to
worry about," and not be afraid that we are opening the door, be-
cause we would ask another question, but, "Ask all the questions
you want to about this one. On this one I will stand; of this one I
am proud." Can you find any like that ?
Mr. Healy. I still decline to answer on the ground it might tend
to incriminate me.
Mr. Chairman. Any further questions ?
Mr. Kennedy. Can we have Mr. Healy stand by ?
The Chairman. Let me ask this one question : Have you had, and
you know this could be established, have you had construction con-
tracts with the Federal Government? It is your Government and
mine.
(The witness conferred with his counsel.)
Mr. Grumet. He didn't hear that.
(The witness conferred with his counsel.)
Mr. Healy. I decline to answer on the ground that it may tend
to incriminate me.
The Chairman. Well, I didn't hear you. Would you speak a little
louder ? I saw the movement of your lips, but I did not hear you.
Mr. Healy. I said I decline to answer on the ground it may tend
to incriminate me.
The Chairman. Do you mean you have had transactions with your
Federal Government that might tend to incriminate you, or that you
have had no contracts or transactions with the Federal Government,
and that might tend to incriminate you ? Why ?
(The witness conferred with his counsel.)
IMPROPER ACTIVITIES IN THE LABOR FIELD 8165
Mr. Grumet. Again I have to repeat what I said before — that this
may serve — that there will be other questions that will undoubtly fol-
low, and this may serve as a link from a chain.
The Chairman. Mr. Counsel, the Chair has had a little experience
early iii life of trying to practice law, and I know that a witness could
open the door. I am not questioning that. But I am trying to
see if there is any door that we can open without him feeling the
necessity of taking the fifth amendment. I have asked him about con-
tracts with the Federal Government, his Government and mine, the
Government that we try to represent here and try to protect for all
the people, for all citizens of this country,
Mr. Grumet. That is just the point. If we open the door, how far
do we go ? That is exactly the question that perplexes the witness.
Senator Mundt. Let me ask a question of the lawyer.
You are a citizen and I am a citizen. I am not going to put you
under oath, but I am getting some cheap counsel, because I am not a
law3^er. But don't you feel that men that have contracts with the
Federal Government, if they have them, should be able to answer a
question as to whether or not they have had such contracts with the
Federal Government I J)o\\\ you think the Federal Government has
a right to protect itself against witnesses who say, "I had one, but I
canY talk about it, so I have to take the fifth amendment. There is
something there that I can't talk about, as you may be opening up
the door" ?
Mr. Grumet. Are you asking me the question ?
Senator Muxdt. Yes.
Mr. Gri'met. I vrill answer it by asking you a question. I assume,
Senator, you are a lawyer ?
Senator Mundt. I am not.
Mr. Grumet. That may be the reason that you are putting that
question. I say this to you, most respectfully. Do you think it is
fair to ask a lawyer representing a client in this situation the ques-
tion that you put to me I What my opinion may be does not matter.
I am here to represent a client, to whom I owe a duty. I am trying to
perform that.
Senator Mundt. I am not going to put you mider oath. I am not
going to insist upon that. I thought you would be glad to explain it.
]Mr. Grumet. I think the lawyers sitting up there may Imow the
answer to tliat question as well as I do. But I will not undertake to
answer that question here. I might, in private, tell you what I think.
Senator Muxdt. I would appreciate it if you Avould tell your client
what 3^ou think and have him tell me.
The CiiAiRMAX. Let's have order.
Mr. Grumet. I think that this witness can think for himself.
The Chairman. Would you be willing to tell us, Mr. Healy,
whether a^ou have a Government contract at this time, w^hether you
are doing construction work for the Federal Government now?
(The witness conferred with his counsel.)
Mr. Healt. I decline to answer on the ground that it may tend to
incriminate me.
8166 IMPROPER ACTIVITIES IN THE LABOR FIELD
The CiiAiRMAX. I am going to instruct the staff to find out. I
would like to know that, if we can ascertain that fact. I would like
to know it. I do not know^ what others' views might be about it, but
I have some doubt about the wisdom and propriety of the Federal
Government contracting with people who find it necessary to take
the fifth amendment when asked a simple question of whether they
have a Government contract. I think it is something, since we are
making this record, that all agencies of the Federal Government en-
tering into construction contracts should be informed about.
Are there any other questions ?
Mr. Kennedy. Could he stand by for a moment ?
The Chairman. All right. If you will remain there, convenient,
so you can hear the testimony, Mr. Healy, we will put another witness
on the stand.
Mr. Balaban, come forward please.
Mr. Kennedy. Mr. Balaban and Mr. Moran.
The Chairman. Mr. Balaban and Mr. Moran, take the witness
chairs.
Mr. Balaban, you have been previously sworn ?
Mr. Balaban. No, sir.
The Chairman. Each of you will be sworn. You do solemnly swear
that the evidence you shall give before this Senate select committee
shall be the truth, the whole truth, and nothing but the truth, so help
you God ?
Mr. Moran. I do.
Mr. Balaban. I do.
TESTIMONY OF HARRY J. MORAN AND JACK S. BALABAN
The Chairman. Mr. Moran, state your name, address, and business
or occupation.
Mr. Moran. I am Harry J. Moran, an accountant with the General
Accounting Office, assigned to this committee.
The Chairman, How long have you been with the Federal Gov-
ernment ?
Mr. Moran. Since 1954.
The Chairman. 1954. You are an accountant ?
Mr. Moran. Yes, sir.
The Chairman. Mr, Balaban, you work for the committee, you have
been with the committee on loan from the General Accounting Office
for quite some time, have you ?
Mr. Balaban. That is right, sir.
The Chairman. Are you a certified public accountant ?
Mr. Balaban. No, I am not. I am an accountant.
The Chairman. How long have you been with the Federal Gov-
ernment ?
Mr. Bx\LABAN. Since 1934.
The Chairman. And an accountant for the Government during that
period of time ?
Mr. Balaban. That is correct, sir.
The Chairman. All right.
Proceed, Mr. Kennedy.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8167
Mr. Kexnedy. You made a study and examination of tlie books of
Mr. Healy and his company, the S. A. Healy Co. ?
Mr. Balaban. I did, sir.
Mr. Kennedy. And an examination by you, also, Mr. Moran ?
Mr. MoRAN. Yes, sir.
Mr. KJENNEDY. You made a study of certain items which are listed
, as nondeductible expenses ?
Mr. Balaban. We did, sir.
Mr. Kennedy. And that is from 1950 through 1956, is that right ?
Mr. Balaban. That is correct.
Mr. I^nnedy. Would you tell the committee what was found in
that investigation regarding the books and records of Mr. Healy, and
what we have found in our subsequent investigations ?
Mr. Balaban. We have found that there were checks to Mr. Healy
and to his son and some others during the years 1950 through 1956,
totaling $228,923 that were charged to nondeductible expenses.
Mr. Kennedy. What does that mean by nondeductible expenses ?
Mr. Balaban. It means that they were not taken into consideration
as a business expense in preparing the income-tax returns of the
S. A. Healy Co.
Mr. Kennedy. What sort of expenses would you have, or would the
company have, which could not be deducted? What kind of expenses
would they have ? They could perhaps have political expenses ?
Mr. Balaban. That is right, sir.
Mr. Kennedy. Would this include any of the expenses that were
charged to politics ?
Mr. Balaban. l^o, sir. This $228,923 does not include those that
were charged for political expenses.
Mr. Kennedy. This is exclusive of that ?
Mr. Balaban. This is exclusive of that.
Mr. Kennedy. What other kinds of expenses would a company
have which could not be deducted ?
Mr. Balaban. Well, there were Christmas gifts in cash to members
of the family.
Mr. Kennedy. Is that included ?
Mr. Balaban. That is not included in the $228,923.
Mr. Kennedy. Can you think of any legitimate expenses that a
company could have which could not be deducted, other than the
ones that you have mentioned ?
Mr. Balaban. No, I cannot, sir.
Mr. Kennedy. If you were making a payment to a government of-
ficial or to a union official, or any matter such as a payoff, those kind
•of expenses could not be deducted, is that correct ?
Mr. Balaban. That is correct, sir.
Mr. Kennedy. So they would have to be listed as nondeductible
expenses ?
^Ir. Balaban. That is correct.
Mr. Kennedy. Would you break it down according to the year a,s to
what you and Mr. Moran found ?
Mr. Balaban. Do you want the totals by years ?
The Chairman. Do you liave a capitulation of it there ?
Mr. Balaban. That is right, sir.
8168 IMPROPER ACTIVITIES IN THE LABOR FIE!LI>
The Chairman. You have verified it ?
Mr, Balaban. We have.
The Chairman. You prepared it yourselves ?
Mr. Balaban. We have.
The Chairman. You and Mr. Moran?
Mr. Balaban. That is correct.
Mr. Kennedy. Mr. Moran, you have checked this, have you ?
Mr. Moran. Yes, I have. I have photostats of all the checks to
back up each of these.
The Chairman. It may be printed in the record at this point, and
the witness may be interrogated about the separate items.
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IMPROPE'R ACTIVITIES IN THE LABOR FIELD
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8171
Additional checks to S. A. Healy and T. B. Healy charged to nondeductible
expense which were not transferred to the 8. A.. Healy long-term obligation
account
Dec. 21,1950
Jan. 28,1952
Check
No.
Payen
T. B. Healy -
Cash
S. A. Ilcaly
Endorsements
other than payee
.$7, 500
6,500
Cash to S. A. Healy per
Schudder financial re-
port (trustee check).
Mr. Kennedy. I see, for instance, starting in 1950, the payee of the
checks is T. B. Healy. What relation is T. B. Healy to S. A. Healy?
Mr. MoRAN. T. B. Healy is the son of S. A. Healy.
Mr. IvENNEDY. He received $21,500 in 1950 ; is that correct ?
Mr. MoRAN. That is correct.
Mr. IvENNEDT. That is from a review of the records ?
Mr. MoRAN. Yes, sir.
The Chairman. Is that in addition to his salaries and expenses
that were paid ?
Mr. MoRAN. He receives no salary from the S. A. Healy Co.
The Chairman. He wasn't employed by the company at that time?
Mr. Moran. No, sir.
The Chairman. He wasn't carried on the payroll ?
Mr.MoRAN. No, sir.
The Chairman. These were checks that were made to someone not
an employee ?
Mr. MoRAN. That is right, sir.
Mr. Kennedy. Going down this list, I see a large number of checks
to T.B. Healy.
Senator Mundt. Before we leave 1950, may I inquire whether you
checked the personal-income statements of Mr. T. B. Healy to see how
he handled that in his personal income ?
Mr. MoRAN. Yes, sir ; we did, sir. It doesn't appear on the income-
tax returns of T. B. Healy.
Senator Mundt. T. B. Healy never reported the $21,500 ?
Mr. MoRAN. That is correct.
Senator Mundt. So that it would stand on the face of it that Mr.
T. B. Healy was simply taking the money to give to somebody else,
to report on his income tax ?
Mr. MoRAN. That is right, sir.
Senator Mundt. It was not his money, he didn't keep it, but he
disposed of it in some way that he didn't have to report it?
Mr. MoRAN. That is correct.
Mr. Kennedy. Have you interviewed Mr. T. B. Healy to determine
what he did with the money, starting in 1950 ?
Mr. MoRAN. Yes, sir; we have. We took a statement, an affidavit
from Mr. T. B. Healy.
Mr. Kennedy. Have you got the affidavit there ?
Mr. Moran. Yes; I have.
Mr. Kennedy. Would you make that available to the Chair ?
The Chairman. "V^^iich one of vou procured this affidavit from Mr.
T.B. Healy?
8172
IMPROPER ACTIVITIES IN ^PHE LABOR FIELD
Mr. MoRAN, I did, sir, Mr. Calabrese and myself.
The CHAiRMAisr. The Chair will read the affidavit.
AFFIDA^aX
District of Columbia.
Citif of Washington, ss.:
I, Thomas B. Healy, make the following sworn statement to A. F. ('alabrese
and Harry Moran, who have identified themselves to me to be investigators with
the Senate Select Committee on Improper Activities in the Labor or Management
Field.
I make this statement voluntarily, with full knowledge that it may be used
in open hearings before this Senate Select Committee on Improper Activities
in the Labor or Management Field.
I have examined a 2-page schedule prepared by Harry Moran listing checks
totaling $228,923, for the period 1950-56. Of this total amount, I received
$177,300, on the following dates :
Date
May 1
Aug. 31
Nov. 2
1961
May 7
Nov. 30
Dec. 14
Dec. 17
196&
Mar. 25
May2«
June 6
June 17
June 20
Check
Amount
No.
7,322
$7, 500
8,165
6.500
S, 585
7,500
9, 071
8,500
853
8,500
982
9,500
994
9,500
1,701
8,500
2,253
9.000
2,301
9,500
2,379
9,500
2,405
8,000
Date
1952
June 30
July 18
Aug. 2
Sept. 4
Nov. 22
1965
Feb. 3_-_
Aug. 2
Oct. 19
1956
Aug. 8
Check
No.
Amount
9,000
8,500
7,800
13,000
10,000
5,000
8,500
I, in every instance, obtained cash, and turned over this cash to my father,
Mr. Stephen A. Healy. I do not know what he did with this $177,300, which
I turned over to him.
I have read this aflSdavit, consisting of two pages, have initialled each page,
and state to the best of my knowledge everything therein is true and correct.
(Signed) Thomas B. Healy,
(Typed) Thomas B. Healy.
Daniel M. Heialy.
Harry J. Moran.
A. F. Calabrese.
Subscribed and sworn to before me this 23d day of January 1958.
• [seal] Chas. E. Alden,
Notary Public, District of Columbia.
My commission expires August 14, 19fi2.
Senator Mundt. Mr. Moran, did you then examine the personal
income-tax returns of Mr. Stephen Healy to see whether or not those
returns reported this sum of $170,000 ?
Mr. Moran. Yes; I did.
Senator Mundt. Was it there ?
Mr. MoRAN. No; it wasn't.
Senator Mundt. Mr. Stephen Healy did not report receipt of that?
Mr. Moran. No.
Senator Mundt. So either his income-tax report was fraudulent,
or he, in turn, transmitted all of his money to some third party?
Mr. Moran. That is correct.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8173
The Chairman. All right. Proceed.
Mr. Kennedy. How much more of the $228,000, Mr. Balaban, how
much more of the $228,000 above the $170,000, approximately $170,-
000, went to Mr. S. A. Healy ?
Mr. Balaban. $21,000 additional went to Mr. S. A. Healy.
Mr. Kennedy. Then $3,500 went to Mr. Shupe?
Mr. Balaban. That is right, sir.
Mr. Kennedy. Do you know what he did with that money ?
Mr. Balaban. Yes. We have an affidavit from him.
The Chairman. The affidavit may be printed in the record at this
point. You may state the substance of it, what he said he did with
tlie money.
Mr. Balaban. Mr. Shupe, in his affidavit, said that he turned the
money over to Mr. Ricliard J. Hill, a vice president of the S. A.
Plealy Co. We have an affidavit from Mr, Hill, saying that he turned
the money over to ]\Ir. S. A. Healy.
The Chairman. The two affidavits may be printed in the record
at this point, the affidavit of Mr. Plill and from Mr. Shupe.
(The documents referred to follow :)
Affidavit
I, V. L. Shupe, was formerly an assistant secretary of the S. A. Healy Co.,
White Plains, N. Y., and make the following signed and sworn statement.
I was employed by the S. A. Healy Co., White Plains, N. Y., for a period of
.several years up until June 1957.
That I make the following statement at the telephone request of Mr. Jack
Balaban of the stafE of Mr. Robert F. Kennedy, chief counsel for the United
States Select Committee on Improper Activities in the Labor or Management
Field, and that the statements contained herein are true to your deponents'
knowledge and belief. The vouchers and canceled checks are not readily avail-
able for my personal inspection, but to my best recollection and belief, the fol-
lowing sums were turned over to Mr. Richard J. Hill, Jr., vice president of the
company, and charged on the company's books as nondeductible expenses. The
amounts shown are parts of the respective check numbers made payable to me
and cashed by me.
Check No.
Date
Amount
D10951
Sept. 5,1951
Sept. 20, 1952
Oct. 11,1955
Apr. 16,1956
$2, 000
D 13078
500
D14759
500
500
I have no knowledge as to the use made by Mr. Richard Hill, Jr., of the above
sums.
V. L. Shupe.
State of New York,
County of Westchester, ss:
Subscribed and sworn to before me this 24th day of January 1958 at Tarry-
town, N. Y.
[seal] Joseph P. Grehan,
Notary Puhlic, State of New York, No. 60~666SJfOO,
Qualified in Westchester County.
Term expires March 30, 1958.
21243— 58— pt. 20-
8174 IMPROPER ACTIVITIEiS IN THE LABOR FIELD
Affidavit
New York, N. Y., January 22, 1958.
To : Robert F. Kennedy,
Chief Counsel, United States Senate Select Committee
on Improper Activities in the Lahor or Management Field:
I, Richard J. Hill, Jr., vice president of the S. A. Healy Co., 65 Court Street,
White Plains, N. Y., make the following signed and sworn statement. I make
this voluntary statement knowing that it may be used in open hearings by the
United States Senate Select Committee on Improper Activities in the Labor or
Management Field.
I have been employed with the S. A. Healy Co. since about the year 1942 and
have been a vice president of the company for several years in charge of the
White Plains, N. Y., office.
During May of 1957, investigators Robert J. Cofini and John Prinos, who
identified themselves to me as being on the staff of the United States Senate
Select Committee on Improper Activities in the Labor or Management Field,
commenced an examination of the company's records. They made specific in-
quiries concerning several large checks charged on the company's books to an
account "nondeductible expenses" for the years 1950 through 1956.
Later I discussed matters relating to the nondeductible expense account at
the New York office of the committee with Mr. Jack Balaban, who identified
himself to me as a staff member of the committee.
At a meeting held in Chicago with Mr. Stephen A. Healy and Daniel M. Healy,
his attorney, Mr. Stephen A. Healy said that these cash items should be
charged to his account.
Journal entries to charge the S. A. Healy long-term obligation account with
$228,923 formerly charged as nondeductible expenses were made subsequent to
the meeting in Chicago. I instructed Donald Zeier, the S. A. Healy Co. accountant
at the White Plains, N. Y., office, and Mr. C. M. Laux, of Lawrence Scudder & Co.,
Detroit, Mich., the S. A. Healy Co. auditors, to make these entries on the books.
I have no knowledge as to the use made by Mr. Stephen A. Healy of the $228,923.
The $228,923 was made up of cash items which had been charged as nondeducti-
ble expense. The total nondeductile items in the period in question approximates
$400,000. The rejjiainder of the items over and above the $228,923 are readily
identifiable by their designation on the S. A. Healy Co. books.
I have read and initialed each page of this affidavit consisting of two pages and
state that they are true and correct.
Richard J. Hill, Jr.
State of New York,
County of New York, ss:
Subscribed and sworn to before me this 22d day of January 1958.
Sadie Sapir,
Notary PuUic, State of Neiv York, No. 24-3453Jf00, Qualified in Kings
County, Certificate Filed With New York County Clerk.
Commission expires March 30, 1959.
Mr. Kennedy. Then there is $6,600 to Gil Pomid.
Mr. Balaban. We have an affidavit from him where he says he also
turned the money over to Mr. Eichard J. Hill.
The Chairman. That affidavit may be printed in the record at this
point.
(The document referred to follows :)
S. A. Healy Co.,
General Contractors, 20 North Wacker Drive,
Chicago, III., January 24, 1958.
Mr. Robert F. Kennedy,
Select Committee on Improper Activities in the Labor-Management Field,
Senate Office Building, Washington. D. C.
Dear Mr. Kennedy : In view of my not having the checks that are in question
available at the present time, however, to the best of my knowledge and recollec-
tion the proceeds of the following checks were turned over to Mr. Richard J.
Hill, Jr.
EVIPROPE'R ACTIVITIES IN THE LABOR FIELD 8175
Check number
Date
Amount
Aug. 16,1955
Sept. 17, 1955
Feb. 17,1956
July 18,1955
$2,400
D14715 . . -
800
D15117
500
1228 -- . ---
3,000
G. G. Pound.
State of Illinois,
County of , ss:
Subscribed aud sworn to before me this 24th day of January 1958.
[seal] W. a. Lavine,
Notary Public, Illinois.
My commission expires June 25, 19G1.
Mr. Kennedy. What did Mr. Hill say he did with the money ?
Mr. Balaban. He said he turned it over to Mr. S. A. Healy.
The Chairman. Is that covered in the affidavit ?
Mr. Balaban. Yes, sir.
Mr. Kennedy. V/here did the $13,000 in cash go ?
Mr. MoRAN. On the $13,000 payable to cash, we do not have the
checks available, so we were not able to determine who the endorser
was.
Mr. Kennedy. So you don't know what happened to that ?
Mr. MoRAN. Well, it was considered as going to S. A. Healy, too.
Mr. Kennedy. In the books ?
Mr. MoiL\N. That is right.
Mr. Kennedy. AVhaf jiboiii the luiscelianeous, $7,5!:i3 ?
Mr. MoRAN. That was a journal entry covering the sale of scrap on
a Never-sink dam in 1956. That was $7,523. .
Mi\ Kennedy. Do yon know what happened to that money ?
Mr. MoRAN. That also went to S. A. Healy.
Mr. Kennedy. So the total of $228,923 over this period of 1950 to
1956 all went to S. A. Healy, is that right?
Mr. MoRAN. Yes.
Mr. Kennedy. Did he declare any of this $228,923 in his income tax
returns ?
Mr. MoRAN. No.
Mr. Kennedy. He did not declare any of it ?
Mr. MoRAN. Xo.
Senator Mundt. Plow about the sale of scrap ? Was that recorded
on tlie books of the company as income ?
Mr. MoRAN. I wasn't able to find it on the books of the company.
However, it did show up in the certified record of the Healy Co. by
the auditors. I reviewed the work papers of the auditor, and this
$7,523 was picked up as going to S. A. Healy.
Senator Mindt. So it appears probable, then, that the necessary
income taxes were paid on this $7,523 by the company?
]Mr. MoR.vN. I did not understand the question, sir.
Senator Mundt. Does it appear probable from your study, then, that
this was reported to the Government as income, and taxes paid on it
by the company ?
Mr. Moran. No.
Senator Mundt. No?
Mr. Moran. By the companj'^, yes. By the company.
8176 IMPROPER ACTIVITIES IN THE LABOR FTEfLD
Senator Mundt. By the company. I understand there is nothing
in the income-tax returns of Mr. Stephen A. Healy indicating even
that he got this money.
Mr. MoRAN. That is correct.
Senator Muxdt. Or what disposition was made of it.
Mr. MoRAN. Eight.
Senator Mundt. it would seem to me even though he didn't keep it
as his own, that some record would have to be made on a proper income
tax report indicating the flow of that much money through a man's
personal account. You are positive that there is no record of that
at all?
Mr. MoRAN. No, sir.
(At this point, the following members of the committee were pres-
ent : Senators McClellan and Mundt.)
The Chairman. I have one other thought at that point.
Did all of this money go to S. A. Healy in cash, after the checks
were cashed ?
Mr. MoRAN. That is our understanding, yes, that is from the
affidavits that were submitted to us.
The Chairman. That is indicated by the affidavits that you have?
Mr. MoRAN. Yes, sir.
The Chairman. These checks would be cashed then, or the cash
received and turned over to Mr. Healy ?
Mr. MoRAN. That is right.
Senator Mundt. Were you able to get from Mr. Healy any explana-
tion of this while you were talking with him ? We have not been very
lucky in this hearing getting anything from him at all.
Mr. MoRAN. He gave no indication at all.
Mr. Kennedy. Now, Mr. Balaban, since our investigation started,
has the company made a change in their books and records ?
Mr. BalaiSan. Yes, they did. After our investigators went into the
company in White Plains, N. Y., journal entries were made transfer-
ring this $228,923 from the S. A. Healy Co. as nondeductible expenses,
to the S. A. Healy long-term obligation account. That is, they charged
it to his personal account, and credited earned surplus.
Mr. Kennedy. S. A. Healy had invested large sums of money in the
company, originally, is that right ?
Mr. Balaban. That is correct, sir.
Mr. Kennedy. So after our investigators began making their in-
vestigation, this company transferred the $228,000 from nondeductible
expenses to a payment to Mr. Healy, a payment to Mr. Healy on the
loan that he initially made to the company.
Mr. Balaban. That is correct.
Mr. Grumet. May we have the date that he made this initially ?
Mr. Kennedy. I don't have it.
Mr. Balaban. I don't have the date.
Mr. Kennedy. Do you know when it is ?
Mr. Grumet. I think it is a loan that has been on the books for
probably about 20 years or more.
Mr. Kennedy. Thank you. I think that is important. This was a
loan that had been made some 20 years ago.
Mr. Balaban. It was not actually a loan; Mr. Healy had turned
over equipment — t]iat is my understanding — had turned over some
IMPROPER ACTIVITIES IN THE LABOR FIELD 8177
equipment and cash to the company in order for it to operate. That
was at the time when the corporation was first started.
Mr. Kennedy. It was when our investigators began their investi-
gation that this $228,000 was then charged to a repayment to Mr.
Healy for this equipment that had been turned over some 20 years
before ?
Mr. Balaban. 1 believe so.
Senator Mundt. This woukl be a payment on equipment and it
w^ould then become a deductible expense ; would it not ?
Mr. Balaban. I don't get you, Senator.
Senator Mundt. If this money, instead of being considered a non-
deductible expense, were in fact to be designated as money spent for
equipment, then it would become a deductible expense of the company.
Mr. Balaban. That is correct.
Senator Mundt. Consequently, I am wondering whether there is
anything in the record to indicate that they have filed an amended
income-tax report to show that in fact, this 'was deductible money.
Mr. Balaban. Not that I am aware of, sir.
Senator Mundt. Would you contact the Internal Revenue Depart-
ment in that connection because it will be interesting if this is in fact,
just a dodge, whether they are going to try to fool the Internal Reve-
nue people as they are trying to do the committee. If it is not a dodge,
obviously, they are going to file an amended income-tax return because
this was a deductible loss.
Mr. Grumet. It was the repayment of a legitimate obligation.
Senator Mundt. If it is machinery, it is a deductible expense.
The Chairman. Could it not be done by checks and marked ac-
cordingly and entered on the books at the time ? I can't answer, but
it does seem to me that if it is a legitimate operation and they want
to pay off their debt or parts of the debt, they would enter it accord-
ingly and not wait until it was under investigation 20 years later and
go to changing the books.
Mr. Kennedy. Mr. Balaban, that covers the complete situation as
far as this money is concerned ?
Mr. Balaban. That is correct.
Mr. Kennedy. Now, could w^e ask Mr. Healy to return for just a
moment to the stand ?
The Chairman. Mr. Healy, come around.
Mr. Grumet. May I have one question here, please, from the ac-
countant ?
The Chairman. You may submit a question to the committee.
Mr. Grumet. I would like to ask the accountant what the amount
of that original obligation was.
Mr. MoRAN. The latest information that we have is that the fur-
therest we were able to go back was 1946 and at that time it was in
excess of $705,000. We could get no determination from them or from
the records just what the original loan was.
Senator Mundt. You can simply file that and let me ask the witness
that question, and he ought to know.
Sit down, Mr. Healy, and I will ask you that question.
8178 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OF STEPHEN A. HEALY, ACCOMPANIED BY HIS
COUNSEL, JACOB GRUMET— Resumed
Senator Mundt. What was the amount of this original loan ? Did
you hear the question, Mr. Healy? What was the amount of the
original loan made to the S. A. Heal}^ Co. ?
Mr. Healy. I decline to answer on the ground it may tend to
incriminate me.
Senator Mundt. Now, Mr. Counsel, there is your witness and you
ought to be able to find out for us.
Mr. Kennedy. Mr. Healy, did any or all of this money go to
Mr. William Maloney ?
(The witness conferred with his counsel.)
Mr. Healy. I decline to answer on the ground it may tend to
incriminate me.
Mr. Kennedy. Did any of this money go to any other union
official, other than Mr. Maloney ?
Mr. Healy. I decline to answer on the ground it may tend to
incriminate me.
The Chairman. Was any of it paid out as a bribe ?
Mr. Healy. I decline to answer on the ground it may tend to
incriminate me.
The Chairman. Was any of it paid out to buy special favors ?
Mr. Healy. I decline to answer on the ground it may tend to
incrininate me.
The Chairman. How old are you ?
Mr. Healy. Sixty-eight.
The Chairman. It is getting about time, isn't it ?
Mr. Healy. I may outlive you.
The Chairman. Sure you may, but don't you think it is about time
to get this record straight ?
Mr. Healy. I tliought you meant it Avas about time for me to
depart.
Mr. Grumet. He misunderstood the significance of your question.
Mr. Healy. I thought you said I was getting old enough to leave
the world.
Mr. Grumet. He misunderstood your remark.
The Chairman. I don't want you to die. I just want you to tell
the truth,
Mr. Grumet. You said, "It is about time," and he did not under-
stand tlie significance of your remark.
The Chairman. I think it is gi'owing a little late ; and if you are
going to get it cori-ected, this would be the time to start, don't you
think so, Mr. Healy?
Mr. Healy. I decline to answer on the ground it may tend to incrimi-
nate me.
The Chairman. I hope you live long enough so you can come in
here without having to avail yourself of the privilege of the fifth
amendment, or that the circumstances will bring to your attention
and your conscience your duty to give a full and correct accounting
of these transactions with j^our Federal Government and with the
representatives of the men who work and labor and toil and who
support union organizations.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8179
I think Ave are entitled to know it ; this Congress has a great respon-
sibility in this field. From the revelations before this committee,
AYorking people have been subjected to exploitation, to abuses, to the
denial of their legitimate rights as citizens of this country and as
members of labor organizations.
If we could get some of you folks who have the knowledge of what
has gone on to testify truthfully, it would enable the Congress to
legislate intelligently and effectively so as to prevent in the future
some of the travesties that have been revealed before this committee.
I do not know whether a little plea like that would possibly influ-
ence you to cooperate and to be more helpful. If it does not, then
I have done my best. Would you help us any better than you have ?
Mr. Healy. I still decline.
The Chairman. You still decline ?
Mr. Healy. Yes, sir.
The Chairman. I hope you think about it. I hope you live long
enough to think about it and during that period of time where you
have a conviction of conscience and come forth with the truth and let
it be known. That is so that we might protect people and protect
our country.
This world is in great danger and we are in peril. These things
weaken us from within. We are drafting our boys and training them
and spending billions upon billions of dollars trying to prepare for
any eventuality from a potential enemy from without, and these prac-
tices certainly do not build the strength that we may need when that
fatal day comes.
We need your help. Your country needs your help, I hope you
will think about it and change your mind before breakfast tomorrow.
All right, proceed.
Senator Mundt. Maybe this is a question that you could answer,
and it will help to clear up one part of the record, since you have
heard the testimony by the accountants. You did not report any of
this two hundred or more thousand dollars in your income-tax state-
ment.
Are you prepared to say that you did not keep this money for
yourself and that your income tax statements were properly made
out?
Mr, Healy, I decline to answer that on the ground it may tend
to incriminate me.
Senator Mundt. You decline to answer that ?
Mr, Healy, Yes, sir.
The Chairman, Well, the Chair is going to excuse you for this
afternoon, but I am going to urge again with all good faith and all
seriousness that you think about this matter until in the morning, and
when the committee reconvenes I want you present at that time,
I will ask that you return to the witness stand and advise us
whether you are willing to answer these questions — any of them that
you have been asked today or such others as may be asked in the
morning, I sincerely hope that you will find it consistent with your
duty to your country and consistent with your conscience to do so.
You may stand aside,
Mr, Kennedy. Mr. Calabrese will be a short witness.
Mr. Calabrese, you have been working on this investigation of the
Operating Engineers?
8180 IIMPROPER ACTWITIES IX THE LABOR FIET^D
TESTIMONY OF ALPHOKSE F. CALABEESE— Resumed
Mr. Calabrese, Yes, sir.
Mr. Kennedy. And specifically on the investigation involving the
finances of William E. Maloney ?
Mr. Calabrese. That is correct.
Mr. Kennedy. During the course of the investigation have we
found that ]Mr. William E. Maloney has a considerable number of
safe deposit boxes ?
Mr. Calabrese. That is correct.
Mr. Kennedy. How many safe deposit boxes have we found Mr.
Maloney has?
Mr. Calabrese. We have found 10 safe deposit boxes in both Mr.
and Mrs. Maloney's names.
Mr. Kennedy. Would you tell the committee where those safe de-
posit boxes are located ?
Mr. Calabrese. The first one is Miami Beach First National Bank
in the name of Mr. and Mrs. Maloney.
The Second is Lake Shore National Bank, Chicago, 111., in the name
of Mrs. William E. Maloney.
Chicago Board of Trade Deposit Co., Chicago, 111., Mr. William
E. Maloney.
Arlington Heights National Bank, Arlington Heights, 111., Mr.
and Mrs. William E. Maloney.
American National Bank & Trust Co., Chicago, 111., Mr. William
E. Maloney.
Continental Illinois National Bank & Trust Co., Chicago, 111., Mr.
William E. Maloney.
Security First National Bank of Los Angeles, Los Angeles, Calif.,
Mr. William E. Maloney.
Liberty National Bank of Washington, D. C, Mr. William E. Ma-
loney.
American Security & Trust Co., Washington, D. C, Mr. William
E. Malonev.
National Safety Deposit Co., New York, N. Y., Mr. William E.
Maloney.
Mr. Kennedy. What is that in summary, the number of cities in
which he has those safe deposit boxes ? How many are there in Chi-
cago ; do you have that ?
Mr. Calabrese. I can get that very quickly.
There are five in Chicago and its area.
Mr. Kennedy. How many in Miami ?
Mr. Calabrese. One in Miami.
Mr. Kennedy. And in Washington ?
Mr. Calabrese. Two ; and one in New York City.
Mr. Kennedy. iVnd one in Los Angeles ?
Mr. Calabrese. Yes, sir.
Mr. Kennedy. Did you find an 11th safety deposit box also?
Mr. Calabrese. We found one which we believed to be Mr. Ma-
loney's safe deposit box. It is in the name of his stepfather, Thomas
Mulcare, who is now deceased.
Mr. Kennedy. What led you to the conclusion that that is also at
the disposal of William E. Maloney ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8181
Mr. Calabrese. Very briefly, upon Mr. Mulcare's death about a
year a^o
Mr. Kennedy. This is in Chicaj2,o?
Mr. Calabrese. This account is at South East Safe Deposit Co. in
Cliicao;©, lib We ascertained that on November 12, 1957, tlie bank
sent a registered letter to Thomas Mulcare. The appHcation had the
address of 327 South LaSalle Street, Chicago, which is the address
of local 150 of the International Union of Operating Engineers.
This was received by one of the office help, Mrs. Moffa, on Novem-
ber 12, and she signed for it, and then turned it over to ]\Ir. Maloney.
On November 14, 1957, a person, a woman, went down to the bank and
paid the arreas on the rental.
This letter, I might add, notified Mr. Mulcare that he was in arrears
in his rental payments and that if the amount was not paid the box
would be drillecl open. I have an affidavit from the custodian at the
South East Safe Deposit Co. which you may like to have read.
The Chairman. The affidavit may be printed in the record at this
point.
(The affidavit is as follows:)
Chicago, III., January 8, J958.
I, Inez M. Killbury, make the following signed sworn statement to Mr. Harry
Moran, who has identified himself to me as an investigator with the United
States Senate Select Committee on Improper Activities in the Labor or Man-
agement Feld. I have been told that this statement may be used in open hear-
ings held before the United States Senate Select Committee on Improper
Activities in the Labor or Management Field.
I reside at 7030 Cregier Avenue, Chicago. 111., and am employed as custodian
at the South East Safe Deposit Co., at 1180 East 63d Street, Chicago, 111.
On November 14, 1957, a woman, who gave her name as Mrs. Helen Justine,
came to me to pay the rental fee on Thomas Mulcare's safe-deposit box. I recall
that she made this payment by giving me a $50 bill. She stated that she was
from "the oflBce" and that the address shown for Mr. Mulcare, 327 South
La Salle Street, Chicago, 111., as shown on Mulcare's application and contract
card was correct and that Mr. Mulcare's mail should be forwarded to that
address. She gave her home address as 5560 West 55th Street, Chicago, 111.
I remember her as being very well dressed.
I have been shown a picture of a man and a woman by Mr. Harry Moran,
and, while I cannot make a positive identification because of the size of the pic-
ture, the woman in the picture vei*y strongly resembles the person who repre-
sented herself to me as Mrs. Helen Justine. I have been told by Mr. Moran
that this is a picture of Mr. and Mrs. William E. Maloney.
I have read the above statement, which consists of one typewritten page,
and state, to the best of my knowledge, everything therein is true and correct.
(Signed) Inez M. Killbury.
Irllard Kaak.
Mr. Kennedy. Did you check the address that that woman gave
when she was there ?
JMr. Calabrese. Mr. Moran checked the address and he ascertained
it was in the middle of the Midway Airport, in Chicago, 111.
Mr. Kennedy. Now, the most important part of all, Mr. Calabrese,
is that we have requested Mr. ]\Ialoney to open these safe-deposit
boxes so we can examine the contents have we not ?
Mr. Calabrese. Yes, I did. I made the request through his attor-
ney on November 24 and I was refused.
Mr. Kennedy. Have we received information back that Mr, Ma-
loney has refused to open these safe-deposit boxes and make the
records in connection with those available to the committee? Has he
refused to open his safe-deposit boxes?
8182 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Calabrese, Yes, sir, it has been refused. That request has
been refused.
Mr. Kexnedy. He would not allow us to examine the safe-deposit
boxes and learn what is contained in there?
Mr. Calabrese. That is right, through his attorney in Chicago.
Mr. Kennedy. So he has refused as far as that is concerned to
cooperate with the committee ?
Mr. Calabrese. That is correct.
The Chairman. Is there anything further ?
If there is nothing further this afternoon, the committee will stand
in recess until 10 : 30 in the morning and Mr. Healy will be back at
that time.
(Whereupon, at 4:55 p. m., the hearing in the above entitled
matter was recessed, to reconvene at 10 : 30 a. m., the following day.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
THURSDAY, JANUARY 30, 1958
United States Senate,
Select Committee ox Improper Activities
IN THE Labor or Management Field,
Washington^ D. C.
The select committee convened at 10 : 30 a. m., pursuant to Senate
Resolution 74, agreed to January 30, 1957, in room 457, Senate Office
Building, Senator John L. McClellan (chairman of the select com-
mittee) presiding.
Present : Senator John L. McClellan, Democrat, Arkansas ; Senator
Sam J. Ervin, Jr., Democrat, North Carolina; Senator Pat Mc-
Namara, Democrat, Michigan; Senator Barry Goldwater, Republican,
Arizona.
Also present : Robert F. Kenned}-, chief counsel ; Jerome S. Alder-
man, assistant chief counsel; Alphonse F. Calabrese, investigator;
James Mundie, investigator; Jack S. Balaban, a GAO investigator
on loan to the select committee ; Robert Worrath, investigator ; Ruth
Young Watt, chief clerk.
The Chairman. The committee will come to order.
(Members of the select committee present at the convening of the
session were: Senators McClellan, Goldwater, and McNamara.)
The Chairman. Mr. Healy, will you resume the stand, please, sir?
TESTIMONY OF STEPHEN A. HEALY, ACCOMPANIED BY HIS
COUNSEL, JACOB GUITJMET— Resumed
The Chairman. Mr. Healy, when you testified yesterday, or, rather,
when you declined to testify, we had asked you a number of questions
about Government contracts and some of your other activities that
this committee is interested in, that the Government has the right
to know about.
You availed yourself of the fifth amendment privilege. The Chair
asked you to think about it last night and see if you coiddn't reconcile
your conscience to meet your public responsibility and come forth this
morning with the facts as you know them to be.
I will ask you now if you are ready to testify, or are you still going
to pursue the course you did yesterday ?
IVIr. Healy. I am still going to pursue the same course I did yester-
day.
The Chairman. You are not going to answer about these Govern-
ment contracts ?
Mr. Healy. No, sir.
SIS?.
8184 IMPROPER ACTlVrTIEiS IX THE LABOR FIELD
The Chairman. All right. We have two here, particularly, in 1956,
I would like to ask you about. One is a contract with the Navy De-
partment, 11th Naval District, construction of Rainbow-Lilac-Red
Mountain-Cathill tunnels at 11th Naval District, San Diego aqueduct,
San Diego, Calif., contract NO Y-12806.
Did your company have that contract, Mr. Healy ?
(The Avitness conferred with his counsel.)
Mr. Healy. I still refuse to answer — I decline to answer on the
ground that it might incriminate me.
The Chairman. You still decline to answer about your relations
with your own Government on the ground that if you answered, the
answer might tend to incriminate you, is that correct?
Mr. Healy. Yes, sir.
The Chairman. I am going to ask you another question.
Mr. Grumet. May I say something- jit this point i It is just a ques-
tion, as I said yesterday, to the witness opening the door to other
questions that may incriminate hiuL
Therefore, he has to take the privilege throughout.
The Chairman. That statement is in the record repeatedly. But
that does not indicate that this committee should not pursue its duty
to make every reasonable effort, at least, to try to get through.
Senator McNamara. Wx. Chairman, that raises a question in my
mind. Are you a citizen of the United States ?
Mr. Healy. Yes, sir.
Senator McNaMx\ra. Were you born in this country- ?
Mr. Healy. Yes.
Senator McNamara. That is all, Mr. Chairman.
The Chairman. I am going to ask you one more time. I will re-
peat the question that I have asked you. Did you have a contract
with the Navy Department in 1956, the 11th Naval District, for con-
struction of Rainbow, Lilac, Red Mountain, and Cathill tunnels at
11th Naval District, San Diego aqueduct, San Diego, Calif., con-
tract No. NO Y-12806 ?
Did you liave such a contract with your Government or the Navy
Department ?
Mr. Healy. You just asked me that question, didn't you, before?
That is the same question ?
The Chairman. I didn't understand you.
Mr. Healy. That is the same question you asked me before.
The Chairman. It is the same question I am asking again.
Mr. Healy. The answer is the same.
The Chairman. What is the same ?
Mr. Healy. I decline to answer on the grounds that it may in-
criminate me.
The Chairman. Now I want to ask you another question. Do you
honestly believe and do you state under your oath that you so be-
lieve that if you give a truthful answer to that question, a truthful
answer thereto might tend to incriminate you ?
(The witness conferred with his counsel.)
Mr. Healy. I decline to answer on the same ground.
The Chairman. With the permission of the committee, the Chair
orders and directs you to answer that question.
Mr. Healy. I decline to.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8185
The Chairman. I make this statement to you in connection with
the order and direction the Chair has given you : We have had some
folks up here in higli positions in hibor unions wlio have taken a simi-
hir position. They refused to answer even simple questions regard-
ing their connection with the union and other questions that couldn't
possibly, as I see it, even tend to incriminate them.
Mr. Grumet. But these may be preliminary questions which may
serve as a link in a chain of proof.
The Chairman. That is in the record. I will ask counsel to let me
proceed. I felt, and I still feel, that no one has a right to take the fifth
amendment, invoke that privilege, unless he states under oath — and he
is under oath, he is on the witness stand testifying — unless he states
under oath that he honestly believes that if he gave an answer, a truth-
ful answer, to the question asked, that a truthful answer thereto might
tend to incriminate him.
Therefore, I am going to treat you as a businessman just as I have
the others, and ask this committee to take the same procedures against
you when you refuse to testify tliat you honestly believe that if you
answered the (question truthfully that you had a contract with your
own Government, with a Government department, that such an answer
might tend to incriminate you.
1 give you that statement, that suggestion, before I ask you to finally
answer, because I want you to know. I just cannot fiind it in my heart,
in my being, to treat businessmen any different than labor leaders. If
they are going to put themselves in the same category, they look alike
to me.
The Chair orders and directs you to answer that question, whether
you honestly believe that if you gave a truthful answer to the question
regarding having a Government contract, that such truthful answer
might tend to incriminate you.
(The witness conferred with his counsel.)
Mr. Healy. I decline to answer.
The Chair]man. All right. Mr. Counsel, with the permission of
those present, I ask that the same proceedings be prepared against this
witness as are in process against the two labor leaders or labor officials
that we ordered proceedings against during the course of recent hear-
ings. That matter may be presented to the committee in its executive
session as soon as it is prepared. I am sure the witness knows what I
mean.
Are there any further questions of this witness ?
Senator McNamara. Mr. Chairman, I have no further questions.
I have a short comment. It seems to me that you properly castigate
labor leaders and business people who come here and take the fifth
amendment and who are not cooperative. I think maybe the hearings
up to this time have developed to a point where you should properly
castigate the bar association, too, because these people come in here
and plead tlie fifth amendment on the basis of advice that they are
given by their attorneys, who sit right there with them and advise
them to take the fiftli amendment. If you are castigating people, let's
include the bar association.
The Chairman. Each Senator has the right to express his own
views.
8186 IMPROPER ACTIVITIES IN THE K\BOR FIE!LD
Mr. Grumet. May I say I think that is a most unfair statement to
the members of the bar. The fifth amendment is part of our Con-
stitution.
Senator McNamara. I expected you to think that.
Mr. Grumet, That is a privilege that a citizen of the United States
has, fortunately, and I don't think you liave the right to castigate
counsel. I think I have as higli degree of ethics as you have, and I
don't think you have a right to castigate me or anj^one else.
Senator McNamara. You start displaying them any minute, now.
The CHAiiofAisr. Just a moment. The Chair tries to proceed in
these matters to make a record, to make a record that can be reviewed.
We do not have the bar association before us. Eacli member, each
Senator, has a right to his opinion about the bar association or an}^
association. This committee is primarily investigating labor-man-
agement relations. We have labor people before us, and we have
management people before us. I can't help but feel that, since we
ordered the action taken against representatives of labor or of some
labor, who have appeared before the committee, who have taken the
position tliat tliey would not answer a question, that they honestly
believed that if they answered the question propounded that a truthful
answer might tend to incriminate them, I am simply proceeding this
morning just as we have proceeded in some other instances where
representatives of labor were involved.
What will be the final outcome of it, I do not know, but I think we
need to determine, once and for all, insofar as we can, whether the,
fifth amendment can just be used capriciously and converted into an
instrument for the shielding of crime and preventing proper tribunals
from getting evidence that is needed. I tliink we have to settle that
issue. There isn't but one way to settle it, and that is to have some
legal action that will go to the proper proceedings for a determina-
tion.
Mr. Grumet. I tliink, Mr. Chairman, you, as a member of the bar,
yourself, appreciate my position here in advising a client as any law-
yer does.
The Chairman. You have a perfect right to advise a client as to his
legal rights.
Mr. Grumet. That is exactly what I am trying to do, according to
the highest concepts of the bar. If I may say so, I think the dis-
tinguished Senator who made that comment perhaps is not a member
of the bar, and does not miderstand the duty of a lawyer to a client.
The Chairman. The Chair has made the statement that he cannot
be responsible for what any individual may think, even a member of
this committee. The other members of this committee are Senators
in their own right ; they are elected by their people. They have just
as much right to express their views as the Chair does. I may not
always agree with them, and they may not ahvays agree with me.
But I do not have the American Bar Association before me this morn-
ing, and therefore I am not making any comments regarding the
bar association.
I think I know the responsibilities of attorneys, and Avhen an attor-
ney comes in here and conducts liimself properly, lie Avill be treated
with every courtesy.
Mr. Grumet. I want to thank yon for that statement, Mr. Chaii-
man, and also for your courtesy. Max I recommend to the distin-
IMPROPER ACTIVITIES IN THE L.\BOR FIELD 8187
guished Senator that lie read the Fifth Amendment, by Professor
Griswold, of Yale, and some of the statements made by some of the
hip-hest officials in this country about that privilege. I am sure, after
reading that, he would not make the statement he did here.
The Chairman. All right.
Senator McNamara. Mr. Chairman ?
The Chairman. Senator McNamara.
Senator McN amara, I don't think we should let the record stay in
the state that it is in at the moment. 1 have taken an oath to uphold
the Constitution of the United States, and I know that that includes
the fifth amendment, and I am for it. But, if we are going to casti-
gate some people and not other people for using it, I don't think it is
quite cricket, I think we ought to castigate everybody who is a party
to it, or else castigate nobody who is a party to it, and I will settle for
either way.
Mr. Cthumet. Do you mean to tell me that you make no distinction
between a witness, perhaps, who takes the fifth amendment, and the
lawyer who is acting as a lawyer giving advice to a witness? You
make no distinction there ^
Senator McNamara. I make this distinction. If it is proper for a
lawyer to so advise him, he shouldn't be castigated. If he should be
castigated for it, so should you.
^Ir. Grumet. I beg- to differ with you, and I don't think I ought to
be. Unfortunately, you are not a member of the bar and don't under-
stand the duties of a lawyer.
Senator McNamara. If you think you are saying something deroga-
tory to me, believe me, sir, I think you are giving me praise, because I
construe that to mean that I am not trained in confusion as you are. If
you want to get personal, let's go from there.
Mr. Grujmet. No ; I don't mean to be disrespectful.
The Chairman. Just a moment. The Chair is castigating no one.
I am stating the principles that I believe in, and I believe there is an
issue that should be determined. If there is one way to get it deter-
mined, it is to get it to the courts. I think it ought to go there, because
I think we ought to know whether this is a legitimate, proper use of
the fifth amendment or it is not. I am making the record for that
purpose.
Mr. Grumet. By all means, and that is for a court to determine.
The Chairman. That is for the court to determine. I said a while
ago I thought I understood exactlj^ what the Chair was doing.
Senator McNamara. To that, I will say "Amen."'
The Chairman. All right. You may stand aside. Call the next
Avitness.
Senator Kennedy. Mr. Chairman, after the testimony of Mr.
Healy, and the testimony regarding safe-deposit boxes in the posses-
sion of Mr. Maloney, we would now expect to call Mr, William Ma-
loney to answer questions about his relationship with Mr. Healy as
well as a number of other questions that we have regarding his own
personal activities.
He has presented a doctor's certificate saying that he is too ill to
appear. It is therefore necessary for us to present the evidence based
on documents that we have studied, based on investigations that we
have made. It is necessary for us to present this evidence not through
Mr. Maloney, but through out own staff investigators. As I said yes-
8188 IMPROPER ACTIVITIES IN THE LABOR FIELD
terday, Mr. Maloney has been less than cooperative with the committee
in the past. He has refused to open his safe-deposit boxes and answer
questions regarding the contents of those safe-deposit boxes. Unfor-
tunately, as I said, we are going to have to go ahead and present this
evidence through our own staff investigator.
The Chairman. Let me see the doctor's certificate. I think in view
of the record, so that the record will be complete, and those who read
might understand wdiy Mr. Maloney is not present, that that certifi-
cate perhaps should be printed in the record at this point.
I do that because people reading the record will not know why you
did not call him. There would just be a statement that he was ill. It
might be challenged. Do we have the certificate ?
Well, the certificate from the physician may be printed in the
record at this point so there will be no question as to why we are not
proceeding to have him here. Of course, in any other proceeding, if
a witness is ill and unable to testify, we cannot compel his appearance
and we should not.
If, however, we find anyone that is perpetrating a fraud or decep-
tion on the committee, we will take the necessary steps to bring him
before the committee. I understand that Mr. Maloney is ill, and that
possibly he is ill to the extent that he should not be required to attend.
But so that the record may be complete, I would like to have the
certificate, unless there is objection, printed in the record at this point.
(The document referred to follows :)
Miami Beach, Fla., January 1^, 1958.
Senator John L. McClellan,
Chairman, Select Committee on Improper Practices in the Lat)or or Man-
agement Field, Senate Office Building, Washington, D. C.
Dear Senator McClellan : Mr. William Maloney, of 6325, La Gorce Drive,
Miami Beach, Fla., has been under my medical care since April 1, 1955, sufifer-
ing from a cardiac condition. During this time it has been necessary to hos-
pitalize him at the St. Francis Hospital because of an associated chest condition,
heart failure, and kidney disease.
Following a trip to Chicago, Mr. Maloney came directly to my oflSce com-
plaining of a flareup of his lieart and chest condition. This \yas last week on
January 8. I carefully checked him via electrocardiogram, laboratory tests, and
clinical examination and found that he was again in heart failure. I immedi-
ately sent him into the St. Francis Hospital — against his wishes, I might add —
and placed him on absolute bed rest and medical management. He is still in
serious condition at the hospital and requires constant medical care.
It was requested on November 12, 1957, that I write my personal feelings
about Mr. Maloney's condition, and I have been told that this letter was for-
warded to you. I have been today advised by Mr. Woll, of your city, that Mr.
Maloney has promised you that he would come to Washington when needed by
yourself and that your committee will open its hearings next week.
Mr. Maloney has insisted that he be permitted to make this trip and assist your
group.
I have definitely and absolutely informed both Mr. Woll and Mr. Maloney
that this trip is completely impossible, both at this time, of course, and for
some months in the near future, and that I would withdraw from the case
should they persist in his leaving the hospital. His condition is far worse than
Mr. Maloney himself realizes, and Mr. Woll is insisting in his keeping his
promise not realizing the seriousness of my patient's condition. I am particu-
larly in the unenviable position of not being able to let my patient know the
seriousness of his condition while preventing him from making this trip and
keeping his promise to you. He is aged beyond his chronological years from
the cardiac standpoint, is already in heart failure at this time and any slight
stress will simply result in a pulmonary edema and cardiac arrest. I therefore
am writing this letter directly to you as an interested physician who fears the
consequences should Mr. Maloney attempt this trip.
cated
IMPROPER ACTIVITIES IN THE LABOR FIELD 8189
I fully recognize the excellent work you and your wonderful committee are
doing, and have felt that it was doing a good job. However, in this case, as a
physician caring a great deal for the safety of his patient, I must request that
my orders be followed and that should some means be found by yourself so
that Mr. Maloney not be subjected to this trip I would sincerely appreciate
such an eftort. I cannot stress too strongly that Mr. Maloney's condition is
very serious, that it has been becoming worse, and that he is now in a cardiac
failure subject to sudden death at any time as a result of his condition.
Please feel free to communicate with me relative to this matter, and I will
malve every effort to cooperate with you.
Yours sincerely,
Leonard H. Jacobson, M. D.
Mr. Kennedy. Mr. Chairman, I might point out that he was sub-
penaecl to appear before the committee, and he presented the doctor's
certiticate. Also, during the course of investigation, lie furnished
some of liis books and records. In view of the fact that he was not
able to appear — the doctor said he could not come — we asked him to
furnish an alHdavit to the conmiittee that he turn over all of his books
and records, and that the safe deposit boxes that we already foimd
were the total number of safe deposit boxes that he had.
He has not signed an affidavit to that effect. The lawyer has indi-
well, he has not signed any affidavit to that etiect.
The Chairman. The Chair will announce that the subpena will be
a continuing subpena, and if at any time his condition improves to
where he can be required to attend, he will be required to attend and
testify.
Mr. Kennedy. Now, Mr. Chairman, we will go ahead and start put-
ting some of the records in, based on our investigation. First witness
to be called will be Mr. James Mundie.
The Chairman. Mr. Mundie, come forward.
(At this point, Senator Ervin entered the hearing room.)
The Chairman. Have you been sworn ? .
Mr. Mundie. I was sworn yesterday. Senator.
TESTIMONY OF JAMES MUNDIE— Resumed
Mr. Kennedy. Mr. Chairman, the first matter is in connection with
a boat
The Chairman. Mr. Mundie, you are an inve.stigator for the com-
mittee, on the committee staff ?
Mr. Mundie. Yes, sir.
The Chairman. How long liave you been with the Government ^
Mr. Mundie. I have been with the Treasury since 1921.
The Chairman. You have been with the Treasury Department since
1921, and you have been working for this committee how long?
Mr. Mundie. Since March 1957.
The Chairman. Proceed.
Mr. Kennedy. The first matter to be discussed will be this boat,
Mr. Chairman. I have a picture of it.
(At this point, Senator Gold water withdrew from the hearing
room.)
The Chairman. Here is an affidavit from Mr. Howard F. Bond.
Mr. Kennedy. That is in connection with the purchase of the boat ?
2124.3 — 58— pt. 20-
8190 IMPROPER ACTIVITIES IX THE K\BOR FIE!LD
The Chairman. The Chair will read the affidavit into the record.
It appears to be in order.
Miami, Fla., January 15, 1958.
I, Howard F. Bond, herewith give the following voluntary statement to
Ralph W. Mills, assistant counsel, United States Senate Select Committee on
Improper Activities in the Labor or Management Field. I understand that my
statement may be entered in the record of sworn testimony received by the com-
mittee to which I have no objection since my comments are the truth to the best
of my recollection and are freely given in response to the questions put to me.
I am a yacht broker with offices and docks at 901 MacArthur Causeway,
Miami, Fla.
During early 1949 I had the 47-foot EIco yacht, the Half Moon, at my docks.
It was was being offered for sale upon behalf of its owner, Mrs. James C.
McGann, of Philadelphia, Pa., and Palm Beach, Fla.
On or about February 2, 1949, two men came to my office for the first time
and looked at the Half Moon. One of them was named Fitzgerald, who said
he was connected with the International Union of Operating Engineers. From
the conversation it appeared that the other man, whose name I do not recall,
was with the same union. I have been told that Mr. Fitzgerald is the late
F. A. Fitzgerald, general secretary-treasurer of the International Union of
Operating Engineers, known as the I. U. O. E. This visit was some time late
in the morning. The two men were in a hurry because they said they were
en route to the horse races. They looked at the Half Moon briefly, expressed
interest, and departed in a matter of minutes.
Late on the afternoon of the same day, after time for the races to be over,
the same 2 men returned to my office accompanied by about 6 other men, all of
whom indicated that they were with the same union, the I. U. O. E. This
group of union men took ;i quick look at the Half Moon, after which they v»^ent
for a ride on her not lasting over 20 mhiutes.
Thereupon, they decided to buy the Half Moon ; and offered .$35,000 for it,
which was somewhat less than the price Mrs. McGann was asking. An agree-
ment then was entered into between Mr. Fitzgerald and me. Mr. Fitzgerald
deiiosited .$.500 in cash with me to serve as a binder, pending Mrs. McGann's
acceptance of the offer and receipt of the union's check for $35,000 which was
promised. »
The entire transaction was very easy and fast. The visit of the eight union
men at my office and docks did not last over 30 minutes altogether. On or
about 2 days later, or February 4, 1949, the $35,000 check drawn on the account
of the International Union of Operating Engineers was received by me; I
retui-ned the $.500 cash deposit to Mr. Fitzgerald : and closed the deal with
Mrs. McGann by obtaining her signature on a "Bill of Sale of Enrolled or
Licensed Yacht." The lUOE then became owner of the Half Moon.
This is the only transaction I have had with any union or union men. Of the
eight or so men I have mentioned who visited me in connection with the
purchase of the Half Moon, the only one whose name I now recall is Mr. Fitz-
gerald. I have had no dealings since with any of these men, with the I. U. O. E.
Itself, or with any other representatives of that union.
I now know on sight Mr. William E. Maloney, who I'm told is president of
the I. U. O. E. : but I have never had any associations or dealings with him in
any way, and have no knowledge of his activities, friends, or associates. It is
my recollection that when I have seen Mr. Maloney in the Miami area in past
years it always has been during the winter season. I am not absolutely posi-
tive, but I do not recall Mr. Maloney as being one of those who negotiated with
me for the purchase of the Half Moon.
During the above-described negotiations for the purchase of the Half Moon,
someone in the group of union men, possibly Mr. Fitzgerald, mentioned that the
yacht was to be used for "entertainment," and also said something about its
use for "union operations" or "union purposes."
I paid little attention to the reasons given for purchase of the yacht.
When the I. U. O. E. acquired the Half Moon it had no captain ; and a luxury
craft, such as that yacht, requires skilled attention and operation at all times.
Mr. Fitzgerald asked me at the time of purchase to recommend a skipper for the
yacht. I recommended Capt. Cecil F. Braund, a very high type and reliable
man. The union employed him immediately ; and Captain Braund has been mas-
ter of the Half Moon continuously to date.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8191
After the Half Moon was bought by the I. U. O. E. it remained at my docks
for a brief time until Captain Braund moved it to a berth at the Miami Beach
boat slips at nearby Miami Beach, Fla.
I have read my statement consisting of three pages, counting this page, and
state that it is the truth to the best of my memory. I am signing it this 15th
day of January 1958.
HowAKD F. Bond.
Witnesses :
RvLPH W. Mills.
Sworn to and subscribed by the above-mentioned Howard F. Bond before me
this 15th day of January 1958.
O. C. Denmark, Notary Public.
Notary public, State of Florida at large; my commission expires March 19,
1959; bonded by Massachusetts Bonding & Insurance Co.
The Chairman. All right, proceed.
Mr. Kennedy. Mr. Mundie, have you examined the records of the
Operating Engineers to determine how that boat was paid for?
Mr. Mundie. I have, sir.
Mr. IvENNEDY. Would you tell us what you found ?
Mr. ]MuNDiE. I have a photostat copy of a check drawn by the In-
ternational Union of Operating Engineers, No. A-2183, dated Feb-
ruary 2, 1949, payable to Mrs. James C. McGann or Howard Bond in
the amount of $35,000. This was drawn on their account at the
Libert}^ National Bank of Washington, D. C.
I also have a photostat copy of the voucher, outlining the same de-
scription of the check, and it says it is for a boat.
The Chairman. The check and voucher may be made exhibit 86,
the check being b<6 and the voucher being 86A.
(The documents referred to* were marked "Exhibits Nos. 86 and
86A" for reference and will be found in the appendix on pp. 8312-
8313.)
The Chairman. May I inquire if it shows out of what funds ?
Mr. Mundie. Out of the expense account.
The Chairman. Out of the expense account funds. Would that
be union funds, pension or welfare funds ?
]Mr. Mundie. It is union funds.
Tlie Chairman. Out of union funds?
Mr. Mundie. Yes, sir.
Mr. Kennedy. Did you examine the international to determine
Mhether tliere was any authorization for the purcliase of the boat?
Mr. Mundie. Yes, sir. I have here a record of the minutes dated
February 1 to 9, 1919. It is entitled "Case No. 15, Purchase of In-
spection Craft for Coastal Construction Work."
Mr. Kennedy. Would you read that again ? That is ratlier im-
portant.
Mr. Mundie (reading) :
Case No. 15. Purchase of Inspection Craft for Coasial Construction Work.
Vice Presidents Walsh and Delaney reported on the conditions of the water-
way and coastal construction work in the operations on the Atlantic coastal
area, and of the necessity of supervision inspections connected therewith, both
from the land and sea approaches, in which it was brought out that no means
were now available by which periodical and emergency trips to that depth of
our work performance on the water could be made. Vice I'resident Swanson
spoke on the use to which watercraft operations by the union local No. 3 hns
been put. and the necessity experienced by him and his organization of cover-
ing the San Francisco Bay operations by water inspections by way of boats as
well as by land approach. After full consideration upon motion duly n\ade
and seconded, it was unanimously resolved that the International Union of
8192 IMPROPER ACTlVITIEiS IN THE LABOR FIELD
Operating Engineers purchase and operate a suitable, stable, and seaworthy
inspection boat for use along the Atlantic coast and inland waterways, and
that the general secretary-treasurer be authorized to make payment therefor
and execute all documents necessary in connection therewith.
The Chairman. May I inquire as to the date of those mmutes ?
Mr. MuNDiE. These are minutes of a meeting dated February 1 to
February 9, 1949.
The Chairman. From February 1 to February 9, 1949?
Mr. MuNDiE. Yes, sir.
The Chairman. What is the date of the check ?
Mr. MuNDiE. The date of tlie check is February 2, 1949.
The Ch.^.irman. Now, those are minutes of what, of the interna-
tional convention, or is it the executive board of the international?
Mr. MuNDiE. Those are entitled ""JMinutes of the Meeting of the
General Executive Board of the International Union of Operating-
Engineers, Held at the Alcazor Hotel, Miami, Fla."
The Chairman. So that the minutes reflect that the executive board
approved the purchase of the boat before the check w^as issued?
Mr. MuNDiE. Down at the bottom of this page it has "February 3
to February T" and on the next page it has, "February 7 to P^bruary
9, inclusive."
Mr. Kennedy. Then it would appear that the check was issued a
day prior to the approval in the minutes ?
Mr. MuNDiE. Yes, sir ; it would be the day prior.
Tlie Chairman. I just wanted to clear that up.
Mr. MuNDiE. On the first page of this book, it says February 1, and
the second page is February 2 and 3, and the next page is February
3d to the 7th, and the next page is 7th to the 9th, and that is the end of
the book.
Mr. Kennedy. From the record it appears that they selected the
boat and paid for the boat prior to getting the approval of the execu-
tive board.
Mr. MuNDiE. That is correct.
Mr. Kennedy. Now, Mr. Chairman, Mr. Mundie wall have to tes-
tify to some other matters relating to the boat, but I would like to
call another witness.
The Chairman. Will you remain there, Mv. Mundie, if you would
like. We will call another witness.
The minutes from Avhich the witness has read excerpts, the total
minutes may be made exhibit No. 87.
(Document referred to was marked "Exhibit No. 87" for reference
and may be found in the files of the select committee. )>
Mr. Kennedy. Capt. Cecil Braund, w ill you come forward, please.
The Chaip.man. Will you come around, Captain.
Do you solemnly SAvear that the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and noth-
ing but the truth, so help you God?
Mr. Braund. I do.
TESTIMONY OF CECIL E. BRAUND
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Braund. My name is Cecil F. Braund. I live at Miami, Fla.,
and my occupation is sailor.
IMPROPE'R ACTIVITIES IN THE LABOR FIELD 8193
The Chairman. Do you waive counsel, Mr. Braund?
Mr. Braund. Yes, sir.
Mr. Kennedy. You spell your name B-r-a-u-n-d ?
Mr. Braund. Yes, sir.
Mr. Kennedy. You have been a skipper on the sea for how long?
Mr. Braund. Since February 5, 1949.
Mr. Kennedy. That is how long you have been with the Operating
Engineers, but how long have you been working with boats?
Mr. Braund. Since 1923, sir.
Mr. Kennedy. You were hired in February of 19-19 by the Operat-
ing Engineers, is that right?
Mr. Braund. That is right.
Mr. Kennedy. To be the skipper of their boat ?
Mr. Braund. That is right.
The Chairman. The Chair presents to you a photograph and I will
ask you to inspect it and state if you identify the picture, and what
it is a picture of. Do you identify that picture?
Mr. Braund. Yes, sir.
The Chairman. What is it?
Mr. Braund. It is a yacht, the Half Moon.
The Chairman. I beg your pardon.
Mr. Braund, It is the yacht Half Moon.
The Chairman. Is that the yacht, Half Moon, that we have been
talking about here, a picture of it ?
Mr. Braund. That is right, sir.
The Chairman. It may be made exhibit No. 88.
(Photograph referred to was marked "Exhibit No. 88" for refer-
ence and Avill be found in the appendix on p. 8314.)
The Chairman. Captain, for your information, those of you who
ai-e captains of boats or yachts, and so forth, do you have to pass some
kind of an examination, or are you licensed in some way? Is there
some regulation that you have to comply with or establish yourself
as eligible for that type of service?
Mr. Braund. Not a pleasure boat, sir.
The Chairman. Not on a pleasure boat ?
Mr. Braund. No, sir.
The Chairman. Have you been captain of any other kind of ship ?
Mr. Braund. Yes, sir.
The Chairman. And you have met those requirements for other
ships ?
Mr. Braund. I am sorry, sir, I misunderstood your question. I
have been captain only on pleasure boats, sir.
The Chairman. Captain only on pleasure boats ?
Mr. Braund. Yes, sir.
The Chairman. So the title "Captain" means you are in cliarge of
the boat for wdioever employs you ?
Mr. Braund. That is all.
The Chairman. There is no further significance?
Mr. Braund. No.
Mr. Kennedy. Ca])tain, could you tell us liow long this yacht is?
Mr. Braund. It is 47 feet, sir.
Mr. Kennedy. AYliat is the tonnage, about 20 tons ?
Mr. Braund. I believe it is 23, sir.
8194 IMPROPER ACTlVITIEiS IN THE LABOR FIELD
Mr. Kennedy. The gross tonnage, it says here, is 28 tons, or almost
29 tons.
Mr. Braund. That could be right, sir.
Mr. Kennedy. You were hired in February of 1949, and you have
been with the vessel ever since, is that right ?
Mr. Braund. That is right.
Mr. Kennedy. For what purpose has this boat been used? First,
by whom, primarily, has the boat been used ?
Mr. Braund. It has been used by Mr. Maloney and other union men
that I know of.
Mr. Kennedy. Has it been used for pleasure trips by Mr. Maloney,
and his wife and other union officials ?
Mr. Braund. It has at times ; yes, sir.
Mr, Kennedy. Has it, to your knowledge, been used to inspect
coastal construction work ?
Mr. Braund. Not to my knowledge, sir. Of course, that was pos-
sible, as we were running along somewhere.
Mr. Kennedy. But you were never told to go out to inspect coastal
construction work ?
Mr. Braund. I can't say that I have, sir.
Mr. Kennedy. During what period of time or what period of the
year was this boat used ?
Mr. Braund. Well, primarily it has been used down in Florida,
which is the winter season.
Mr. Kennedy. In what months down in Florida ?
Mr. Braund. From January to April.
Mr. KJENNEDY. And is that when Mr. Maloney is down in Florida ?
Mr. Braund. That is usually right.
Mr. Kennedy. He is down there almost every year between January
and April?
Mr. Braund. Yes, sir.
Mr. Kennedy. Does he have a home down there ?
Mr. Braund. I believe so, sir.
INIr. Kennedy. Have you ever been to his home ?
Mr. Braund. I was in his home once, sir.
Mr. Kennedy. Have you seen his home ?
Mr. Braund. I have seen it from the outside.
Mr. Kennedy. I think we have a i)icture of that.
(A document was handed to the witness. )
Senator McXamar^v. Could I ask this at this point: In your judg-
ment was this price of $35,000 paid for the boat excessive or reason-
able?
Mr. Braund. I don't believe it was excessive.
Senator McNamara. You think it was a reasonable price ?
Mr. Braund. Very reasonable.
The Chairman. I hand you another photograph, and I ask you to
examine it and state if you identify it.
Mr. Braund. As I say, I am not too familiar with the home, but it
sure looks like it.
The Chairman. I did not understand you.
Mr. Braund. I am not too familiar with the home, but it does look
like it.
The Chairman. That mav be made exhibit Xo. 89.
IMPROPE'R ACTIVITIES IN THE LABOR FIELD 8195
(Photograph referred to was marked "Exhibit No. 80" for reference
and will be found in the appendix on p. 8315.)
Mr. Kennedy. How many times a week would it be used by Mr.
Maloney and his family or his wife ?
Mr. Braund. About twice a week, sir.
Mr. IvENNEDY. Would it be just a question of going out and taking
a run around the bay or the ocean there 'I
Mr. Braund. That was mostly so.
jMr. Kennedy. Sometimes fishing ?
Mr. Braund. Sometimes fishing trips, yes, sir.
Mr. Kennedy. To your knowledge it was never used to go out and
inspect any construction work ?
Mr. Braund. I can't say, sir.
JMr. Kennedy. Was it ever brought up North I
Mr. Braund, Yes, sir.
Mr. Kennedy. Could you tell us when and how many times it was
brought up North, and to where it was brought 'I
INIr. Braund. Well, I thought I had been up here 4 times, but ac-
cording to the logs, we looked over this morning, I guess we have only
been up here 3 times. It was during 1949.
Mr. Kennedy'. AVliere did you go in 1949 ?
Mr. Braund. I came up to the bay here, sir, down to Shady Side, Md.
Mr. Kennedy. And who used the boat then ?
Mr. Braund. Mr. Maloney, and the union officials.
Mr. Kennedy. Was it used to inspect construction work at that time
that you know of ?
Mr. Braund. I can't say, sir ; we went up and looked over that new
bridge that was being built at that time over the Chesapeake Bay, and
I forget the name of it now.
Mr. Kennedy. But as far as going out in actual trips to go and
inspect any construction work, you never did that, did you?
Mr. Braund. I don't believe so, sir.
Mr. Kennedy'. What about this, you came up in 1949 and you came
on to the Chesapeake Bay, and you came up in 1952?
Mr. Braund. Yes, sir.
Mr. Kennedy. Wliere did you go at that time ?
Mr. Braund. Just around the bay, sir.
Mr. Kennedy. The same spot ?
Mr. Braund. Yes, sir.
Mr. Kennedy. Did you come up a third time ?
Mr. Braund. I am sure I did.
Mr. Kennedy. Did you go up to Long Island at one time ?
Mr. Braund. I went up to Long Island in 1949, 1 believe.
Mr. Kennedy. And who used the boat up in Long Island ?
Mr. Braund. Mr. Delaney.
JMr. Kennedy. And do you know what his position was with the
Operating Engineers?
Mr. Braund. No ; I don't at that time, sir.
Mr. Kennedy. I believe he was secretary-treasurer of the Operating
Engineers.
JMr. Braund. He is now.
Mr. Kennedy. He is now?
Mr. Braund. Yes, sir.
8196 IMPROPER ACTIVITIEiS IN THE LABOR FIELD
Mr. Kennedy. He was vice president of the Operating Engineers
at that time ?
Mr. Braund. I don't know.
Mr. Kennedy. And how long did you stay in Long Island?
Mr. Braund, Approximately 10 weeks.
Mr. Kennedy. Was he stationed there or what was the arrange-
ment ?
Mr. Braund. As I understood, he had a summer home up there.
Mr. Kennedy. And you were there for his use during the summer?
Mr. Braund. That is right.
Mr. Kennedy. And the same kind of trips that you described already
Mr. Maloney used the boat for, it was the same kind of trips that you
took Mr. Deianey ?
Mr. Braund. Yes, sir.
The Chairman. Captain, who pays your salary ?
Mr. Braund. Beg pardon, sir.
The Chairman. Who pays your salary?
Mr. Braund. The union.
The Chairman. The union?
Mr. Braund. Headquarters.
The Chairman. The international union?
Mr. Braund. Yes, sir.
The Chairman. You get checks from the union ?
Mr. Braund. Yes, sir.
The Chairman. You are paid by the month, I assume ?
Mv. Braund. Twice a month.
The Chairman. You are paid twice a month ?
Mr. Braund. Yes, sir.
The Chairman. And all of your checks and all of your pay has
come from the union treasury?
Mr. Braund. That is right.
The Chairman. What crew do you liaA^e?
Mr. Braund, Just myself, sir.
The Chairman. No others?
Mr. Braund. No, sir, except when we take long trips, I usually
hire a man to go with me.
The Chairman, Who pays him?
Mr, Braund. Well, thev do.
The Chairman. Who is "they"?
Mr. Braund. The union pays him.
The Chairman. The union pays anybody you employ?
Mr. Braund. Yes, sir.
The Chairman. When you say go on long trips, you mean when
you go out on a cruise?
Mr. Braund. No, sir ; that means when I move from INIiami to Wash-
ington, or Annapolis.
The Chairman. When you are out at night, you have to have some-
one with you, or do you actually assign someone?
Mr. Braund. We usually tie up at night, but you still iiued help.
The Chairman. On long trips, you employ someone else ?
Mr. Br^\und. That is right, sir.
The Chairman. And the union pays for that ?
Mr. Braund. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8197
Senator McXamaua. Tliis additional crew you hire, are they
usually deckhands or stewards or what is it '.
]\rr. Brauxd. Well, they are usually men that are familiar with
boats, and usually someone I know.
Senator jMcNamara, On these long trips, do you have a steward
to do the cooking?
Mr. Braund. No, sir, not except for myself. Those particular
trips I make alone.
Senator McNajiara. When you take these long tri]:)S, you ordinarily
do not have officials of the union with you, or do you ?
]\Ir. BR.VUND. No, sir ; not at that time.
Senator McNamar^v. When you came from Florida to Chesapeake
Bay, did you have some of the officials accompanying you?
Mr. Braund. No, sir.
Mr. Kennedy. Except for the three trips that you have taken up
here, up north, is the boat used more than from January through
March or early April, generally ?
Mr. Braund. I think it shows a couple of trips in May or June
this year.
Mr. Kennedy, But primarily, the time that the boat is used is dur-
ing the period that Mr. Maloney is down at his winter home from
January through April in Miami ?
Mr. Braund. That is right.
Mr. Kennedy. Other than those 3 or 4 months, the boat is not used
very often ?
Mr. Braund. That is right.
Mr. Kennedy. It is not used very frequently ?
Mr. Braund, That is right.
Mr, Kennedy, Now, tJiis boat would be described as a pleasure
craft, would it not ?
Mr. Br^^und. I w ould say so.
The Chairman. Would you mind stating your salary, your amiual
salary ?
I have it, but I would like to get it in the record, so we can get
a better understanding as we go along.
Mr. Braund. I think, in 1956, 1 made $5,002 or something like that,
sir. I forget exactly what it was.
The Chairman. For this service on that boat ?
Mr. Braund. That is right, sir.
The Chairman, Are there any other questions of the captain ?
Senator McNamara, I would like to ask a question. This $5,002'
that you received in 1956; would that be approximately the union
scale for somebody who is operating mechanical equipment ?
Mr. Braund. If there is any union scale on boats, sir, I haven't
heard of it.
Senator McNamara. You are working for an international union
that claims jurisdiction in all sorts of equipment that is mechanically
operated. They have a union scale. I think it Avould be considerably
more than $5,000 a year.
Mr. Braund. I would not know their scales, sir.
Mr. Kennedy. That is all I have.
The Chairman. All right ; thank you.
Mr. Kennedy, Mr. Mundie, would you return to the stand ?
8198 IMPROPER ACTrVITIES IN THE LABOR FIELD
TESTIMONY OF JAMES MUNDIE— Resumed
Mr. Kennedy. Have you made a study of the records of the Op-
erating Engineers to determine the cost to the union for this pleasure
craft?
Mr. MuNDiE. I have, sir. I have photostatic copies of the ledger
sheets for the years 1949, 1950, 1951, 1952, 1953, 1954, 1955, and 1956.
Tlije Chairman. Those photostatic copies may be made exhibit
No. 90.
(Documents referred to were marked "Exhibit No. 90"' for reference,
and may be found in the files of the select couuuittee.)
The Chairman. Now, you may testify from them, if you desire.
Mr. MiTNDiE. I also have made a recapitulation on a worksheet.
The Chairman. You have made a capitulation of the expenses of
the boat ?
Mr. MuNDiE. For all of the yeai*s ; yes.
The Chairman. You may start by telling us that the boat cost
$35,000 originally ; is that included ?
Mr. MuNDiE. Yes, sir..
The Chairman. Go ahead and testify regarding the expenditures.
Mr. MuNDiE. In 1949, the boat cost $35,000. The captain's salary
was $3,270, and the expenses were $7,887.39. In the year 1950, the
captain's salary was $4,100, and the expenses were $5,534,94.
The Chairman. That is $5,000 for expenses?
Mr. MuNDiE. $5,532.94. In 1951, the captain's salary was $4,200.
The expenses were $4,571. In 1952, the captain's salary was $4,500,
and the expenses were $10,548.42.
The Chairman. That is $10,000 for expenses ?
Mr. MuNDiE. Yes. In 1953, the captain's salary was $4,690, and the
expenses were $5,940.47. In 1954, the captain's salary was $4,740,
and the expenses were $5,193.25. In 1955, the captain's salary was
$4,990, and the expenses were $8,356.57.
The Chairman. What was the captain's salary that year ?
Mr. MuNDiE. $4,990. In 1956, the captain's salary was $5,040, and
the expenses were $1,973.87. That makes a total cost of the boat,
$35,000; the captain's salary, $35,530; the boat expense, $50,005.91;
and a grand total of $120,535.91.
The Chairman. $120,535.91 ?
Mr. MuNDiE. Yes, sir.
The Chairman. Now, that does not include the year 1957?
Mr. MuNDiE. No, sir.
The Chairman. Apparently, it would run over $130,000 ?
Mr. MuNDiE. It would run pretty close to that.
The Chairman. The captain says he is now getting over $5,000.
Mr. MuNDiE. Yes, sir.
The Chairman. So, it would run in the neighborhood of $130,000,
since the boat was purchased, that the union dues have gone to pay
this expense ?
Mr. MuNDiE. That is correct .
The Chairman. All right.
(At this point the following members were present : Senators Mc-
Clellan and Ervin.)
IMPROPER ACTIVITIES IN THE LABOR FIELD 8199
Mr. Kennedy. And, Mr. Chairman, the boat, as has been ])ointed
out by the previous witness, was for personal, private purposes, rather
than for any union purpose.
The Chairman. This capitulation may be made exhibit No, 91.
(The document referred to was marked "Exhibit No. 91" for ref-
erence, and may be found in the files of the select committee.)
The Chairman. Is there anythinir further ?
Mr. Kennedy. That is all," for the present, of this witness.
The Chairman. Call the next witness. You may stand aside.
Mr. Kennedy. We are aoing into another transaction involving
Mr. Maloney, and I would like to call Mr. Alphonse Calabrese.
TESTIMONY OF ALPHONSE CALABRESE— Resumed
The Chairman. Mr. Calabrese, you have been previously sworn.
You may proceed.
Mr. Kennedy. Mr. Calabrese, you have been working on the Oper-
ating Engineers and the activities of Mr. William E. Maloney?
Mr. Calabrese. I have.
Mr. Kennedy. Specifically, you have some information regard-
ing an International Labor Conference in Geneva, Switzerland, held
from June 7 to July 1, 1950 ?
Mr. Calabrese. I do.
Mr. Kennedy. And did Mr, William E. Maloney attend that con-
ference ?
Mr. Calabrese. He did.
Mr. Kennedy. For attending that conference, did he receive some
money from the United States Government, for his expenses, for tak-
ing the trip ?
Mr. Calabrese. Yes, he did,
Mr. Kennedy. Would you give us a breakdown as to the money
that he received from the United States Government and from any
other source for taking that trip, and what has happened to the
monej^ ?
You can relate it as you planned.
Mr. Calabrese. Mr, Maloney was appointed by the Secretary of
Labor as one of the advisers to the delegate for the workers of the
United States at the ood session of the International Labor Conference,
Geneva, Switzerland,
The Chairman. What year?
Mr. Calabrese. That was held on June 7 through July 1, 1950.
As a result of this appointment, he was given an advance of $10,000
by the International Union of Operating Engineers.
Mr. Kennedy. How nmch was that ?
Mr. Calabrese. $10,000. With this $10,000, Mr. Maloney pur-
chased
Mr. Kennedy. Would you go through what he was given by the
United States Government?
Mr. Calabrese. The total moneys that the United States Govern-
ment paid for Mr. Maloney was $1,001.85.
Mr. Kennedy. That was to cover his traveling ?
Mr. Calabrese. To cover his transportation and his per diem.
Mr. Kennedy. He received a little over $1,000 ?
Mr. Calabrese. A little over $1,000, that is correct.
8200 IMPROPER ACTIVITIES IN THE Ll\BOR FIFXD
Mr. Kennedy. In addition to that, he received $10,000 from the
union ?
Mr. Calabrese. Actually, a grand total of $13,387.29 from the
union.
The Chairman. He got $10,000 advanced. How do you account for
the other $3,000 ?
Mr. Kennedy. Give it to us the way you planned.
Mr. Calabrese. With the $10,000, Mr. Maloney purchased $10,000
worth of traveler's checks in various denominations. Our investiga-
tion has revealed that $1,890 of these checks \\e have, produced pur-
suant to subpena by the American Express Co.
Three thousand six hundred and ninety dollars cashed by Mr. Ma-
loney, have been destroyed by the American Express Co. That leaves
$4,420 in traveler's checks that are not accounted for to date. That
is to say the American Express Co. still has those checks out on the
books. They have never been returned.
The Chairman. They have never been cashed ?
Mr. Calabrese. They have never been cashed.
The Chairman. Were they issued to Mr. Maloney ?
Mr. Calabrese. That is correct.
The Chairman. To him personally ?
Mr. Calabrese. To him personally.
The Chairman. Are they still good? If they are presented, could
they be cashed now ?
Mr. Calabrese. I would say so, Senator.
The Chairman. That is one way, then, of laying a little money
aside for a rainy day.
Mr. Calabrese. We feel perhaps they may be in one of those safe-
deposit boxes.
The Chairman. I expect that you are right.
Mr. Calabrese. With regards to this trip, there was a $63.60 pur-
chase made at Lutz & Co., Inc., here in Washington, for a suitcase
for Mr. Maloney.
Mr. Kennedy. This is in addition to the $10,000 ?
Mr. Calabrese. This is in addition.
Mr. Kennedy. He charged a suitcase of $63.60 ?
Mr. Calabrese. Yes. And the union paid it by check. We have
the clieck.
Mr. Kennedy. The $10,000 wasn't suflicient, evidently, so he got the
suitcase and charged that to the union ?
Mr. Calabrese. As you can see, there are additional moneys.
Mr. Kennedy. Go ahead.
Mr. Calabrese. On May 8, 1950, the union paid $411.19 for a re-
cording machine. This appears on the voucher, the union voucher.
However, the invoice from which this material was purchased, indi-
cates that it was actually a Leica camera, with a hood and filter.
Mr. Kennedy. And it was listed on the union books as a recording
machine ; is that right ?
Mr. Calabrese. On the voucher, that is correct, yes.
Mr. Kennedy. On the voucher it was a recording machine, but, in
fact, it was a camera.
Mr. Calabrese. That is right, for the payment of this material.
The Chair3ian. How do you know it was a camera ?
How did you get that information?
IMPR-OPE'R ACTIVITIES IN THE LABOR FIELD 8201
Mr. Calabrese. From the invoice of the company that sokl the
camera to Mr. INIakmey.
The Chairman. It is for the same amount ?
Mr. Calabrese. For the same amount ; yes, sir.
The Chairman. At the same time ?
Mr. Cai^vbrese. It is approximately tlie same time ; yes, sir.
The Chairman. In other words, the company that sold the item,
showed that they sold a camera ; is tliat correct ?
Mr. Calabrese. The invoice shows May 5, 1950, and the check and
voucher is May 8, 1950.
The Chairman. Three days later ?
Mr. Calabrese. Yes, sir ; 3 days later,
Mr. Kennedy. What was purchased with this amount of money
from the shop was a Leica camera ; was it not ?
Mr. Calabrese. That is correct, a Leica camera and hood and
filter.
Mr. Kennedy. It was not a recording- machine ?
Mr. Calabrese. It was not a recording machine. That is it exactly.
On May 11, he received $60 from the union, the voucher indicating
that this was for gratuities for Mr. Maloney's European trip.
The Chairman. Gratuities? Tips?
]Mr. Calabrese. Tips; yes, sir. On July 31, 1950, the union paid
$1,054 for photographs taken at a well-known restaurant in New York
City, and the voucher indicates that this was for photograplis for Mr.
Malonev'S bon voyage dinner.
Mr, Kennedy, How much is that for pictures of Mr. Maloney's
bon voyage dinnei?
Mr. Calabrese. $1,054.
The Chairman. What became of the photographs?
Mr. Calabrese. They apparently went to Mr. Maloney and his
friends.
The Chairman. To Mr. Maloney and his friends. All right. Pro-
ceed.
Mr. Calabrese. With regard to the voyage itself and transpor-
tation, the Government paid for Mr. Malonev's transportation aboard
the Queen Elizabeth. He left i\\Q United 'States on May 15, 1950.
Mr. Maloney was accompanied by his wife. The union paid for Mr.
Maloney's wife's travel and, in addition, paid an additional $72 to-
ward the transportation of ]\Ir. Maloney which the United States
Government had paid for, apparently for a better berth.
Mr. Kennedy. Better accommodations?
Mr. Calabrese. Better accommodations, that is correct.
Mr. Kennedy. So in addition to the $10,000, the union also paid
for his wife's transportation to Europe, and then paid another $72
so that ISIr. Maloney could get better accommodations ?
Mr. Calabrese. Yes. That totaled $537.
Mr. Maloney and his wife had planned to return to the United
States aboard the America on a particular date, but it apparently
Avas canceled.
Mr. Maloney had purchased return transportation with a Govern-
ment travel request. This was canceled out. The uuion had bouglit
]\rrs. Maloney's transportation back. What happened then was that
the United States Lines made a rebate to the United States Govern-
8202 IMPROPER ACTIVITIES IN THE LABOR WIE'LT)
meiit for Mr. Maloney's ticket, and made another rebate of $361.50
to Mr. Maloney, himself, for his wife's ticket which had been pur-
chased by the union.
This money, this cJieck, was deposited in Mr. Maloney's bank ac-
count.
The Chairman. So he cashed in transportation for his wife that
the union had paid for ?
Mr. Calabrep^:. The return portion.
The Chairman. Then he got the check and put that check in his
own personal account '(
Mr. CALiVBRESE. Ycs.
The Chairman. And it amounted to how much ?
Mr. Calabrese. $361.50.
Mr. Maloney returned to the United States on the lie de France and
arrived in New York City on August 1, 1950. He submitted an ex-
pense account to the United States Government and was allowed
$605.08 in expense money, per diem.
The Chairman. From the Government ?
Mr. Calabrese. From the Government.
This, coupled with the transportation that the Government paid
overseas, was $1,001.85. That is the figure I mentioned earlier.
While Mr. Maloney was over in Europe, he spent some time vaca-
tioning in Europe, and arranged to buy a 1947 Chevrolet from an
American citizen in Paris. This Chevrolet was paid for by union
check in the amount of $900. This is an additional siim of money
that the union paid for. The car came back on the lie de Frwnce.
The Chairman. It came what ?
Mr. Calabrese. It returned on the lie de France with Mr. Maloney
and was paid in counterpart funds of the United States.
The Chairman. They paid out counterpart funds to bring his car
back?
Mr. Calabrese. To return the car; yes, sir. The total figures, ex-
clusive of the counterpart funds, which are French francs, are these.
Total moneys paid by the lUOE to or on behalf of Mr. and Mrs.
Maloney, amounted to $13,387.29 ; cost to the Government was $1,001.85,
or a grand total of $14,389.14. I might add with regard to the Chevro-
let we do not know what happened to that after it got back to the
United States. That may be another document that may be in his
safe- deposit boxes.
Mr. Kennedy. So over $13,000 of union funds were used to take
Mr. Maloney and his wife to Europe, and used for transportation for
this vacation, for the purchase of pictures, the camera, luggage, and the
other matters that you mentioned, and the automobile ; is that right ?
Mr. Calabrese. That is correct.
Mr. Kennedy. All for Mr. Maloney's personal pleasure ?
Mr. Calabrese. That is correct.
Mr. Kennedy. The initial $10,000 was approved by the executive
board ?
Mr. Calabrese. That is correct.
Mr. Kennedy. And that the executive board, made up of the vice
presidents of the Operating Engineers, wliose salaries are fixed by Mr.
William E. Maloney ; is that right ?
Mr. Calabrese. That is my understanding.
IMPROPE'R ACTIVrriES IN THE LABOR FIELD 8203
Mr. Kennedy. And some $3,600 he just took ?
Mr. Calabuese. That is right ; yes.
The Chairman. Was there any accounting for that $10,000 other
than Mr. Maloney got it ?
Mr. Calabrese. There is no accounting; no.
The Chairman. It was just a lump-sum payment, "Here is $10,000.
Go out and have a good time."
Mr. Calabrese. That is correct.
The Chairman. Is there anything further ?
Mr. Calabrese. The documents backing up the statements I have
related are here, and if you would like to put them in as exhibits,
or as exhibits for reference, we liave them available, the documents
pertaining to these transactions.
The Chairman, Can they be put in as one exhibit in a package?
Mr, Calabrese, Yes,
The Chairman, The documents supporting the testimony given
by the witness with respect to this trip of Mr. Maloney and his wife
to attend this conference, with respect to all matters the witness has
now testified to, those documents may be made a package exhibit,
exhibit 92,
(The documents referred to were marked "Exhibit No. 92" for
reference and may be found in the files of the select committee.)
The Chairman. The connnittee could not get through by noon, but
we can, I think, finish this afternoon with respect to those witnesses
who are in appearance here today. That does not mean that the hear-
ing will close today, but we can very well recess now until the after-
noon and then conclude after a couple of hours this afternoon.
Since we have to hold an afternoon session, the Chair is going to
recess until 2 : 15,
(Whereupon, at 11:45 a. m., a recess was taken, with the follow-
ing members present : Senators McClellan and Ervin, to reconvene
at 2 : 15 p. m. of the same day.)
afternoon session
(At the reconvening of the committee, the following members were
present : Senators McClellan and Gold water.)
The Chairman. The committee will come to order. Proceed, Mr.
Kennedy, to call the next witness.
Mr. Kennedy. Mr. Balaban and Mr. Gould.
The Chairman. Mr. Balaban, you have been previously sworn?
Mr. Balaban. Yes, sir.
The Chairman. Mr. Gould, you have not been sworn. Do you
solemnly swear that the evidence you shall give before this Senate
select committee shall be the truth, the whole truth, and nothing but
the truth, so help you God ?
Mr. Gould. I do, sir.
TESTIMONY OF JACK S. BALABAN (RESUMED) AND MARSHALL T.
GOULD
The Chairman. Mr. Balaban has already identified himself for the
record.
Mr. Gould, will you identify yourself, please, sir?
8204 IMPROPER ACTIVITIES IN THE LABOR FIEILD
Mr. Gould. I am an accountant for the General Accounting Office.
The Chairman. What are your initials?
Mr. Gould. M. T. Gould, Marshall T. Gould.
The Chairman. You are with the General Accounting Office?
Mr. Gould. Yes, sir, assigned to this committee.
The Chairman. On loan to this committee. All right, proceed.
Mr. Kennedy. Once again, Mr. Chairman, as I said this morning,
since Mr. Maloney is not here, we will have to proceed with the doc-
uments we have examined and with our own investigators to try to
show the picture of Mr. Maloney's activities. This morning we went
into the trip that he took to Europe, and also the boat that was operat-
ing for his personal pleasure down in Florida, but which was paid for
by the union, and on which the expenses were kept up by the union.
' I would like to find out some information from Mr. Balaban.
How much money did Mr. Maloney receive from the Operating Eng-
ineers, its local 150, which is under trusteeship, or organizations that
are connected with the Operating Engineers, that he declared on his
income tax from the year 19-50 through 1956 ?
This would be as is shown in his income-tax returns.
Mr. Balaban. In his income-tax return, he showed that he received
$388,578.13.
Mr. Kennedy. He received $50,000 in 1950?
Mr. Balaban. That is right.
Mr. Kennedy. $50,000 in 1951 ?
Mr. Balaban. That is right.
Mr. Kennedy. $50,800 in 1952?
Mr. Balaban. That is correct.
Mr. Kennedy. $56,700 in 1953?
Mr. Balaban. That is correct.
Mr. Kennedy. $55,000 in 1954?
Mr. Balaban. That is correct.
Mr. Kennedy. $66,078.13 in 1955 ?
Mr. Balaban. That is correct.
Mr. Kennedy. And in 1956, $60,000, is that right?
Mr. Balaban. That is correct.
Mr. Kennedy. That is from the union.
The Chairman. From the international ?
Mr. Kennedy. The international, local 150, would that be correct?
Mr. Balaban. No, it is just the international.
Mr. Kennedy. That would include everything he declared from
the union's side, from the international and from any organization
connected with the international ?
Mr. Balaban. That is all he declared.
Mr. Kennedy. That is all he declared, is that right?
Mr. Balaban. That is right, sir.
The Chairman. In other words, this covers during those years 1950
to 1956, his income-tax return showing the income received from union
sources, whether international, local, trusteeships, or otherwise?
Mr. Balaban. That is correct.
The Chairman. And the total is $388,578.13 ?
Mr. Balaban. Yes, sir.
Mr. Kennedy. And that would include his income and any ex-
penses that he declared, is that right ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8205
Mr. Balaban. That is right.
Mr, Kennedy. Plow much, from our investiji;ation, have we found
that Mr. Maloney received from the union as described by the chair-
man ?
Mr. Balaban. We show a total of $742,228.20.
The Chairman. How much?
Mr. Balaban. $742,228.20.
Mr. Kennedy. So there is a difference from what he declared and
what he received of $372,500?
Mr. Balaban. $353,650.07.
Mr. Kennedy. $353,650.07?
Mr. Balaban. That is correct, sir.
Mr. ICennedy. Which is a difference between what he declared and
what he actually received in this period 1950 through 1956 ?
Mr. Balaban. That is correct, sir.
Mr. Kennedy. Would you give us the figures of what he actually
received during the years that we have mentioned, starting in 1950?
The Chairman. Let me ask a question. The 1950-56, is that in-
clusive, for a 7-year period ?
Mr. Balaban. For a 7-year period, yes, sir.
In the year 1950, $103,792.63; for the year 1951, $94,023.30; 1952,
$111,814; 1953, $106,206.97; 1954, $114,068.64; 1955, $118,808.05 ; 1956,
$93,514.61 ; making a total of $742,228.20.
The Chairman. Do you have some worksheets there from w^hich you
have developed these figures ?
Mr. Balaban. That is right, sir.
The Chairman. Do you have a sheet where you worked up these
totals ?
Mr. Balaban. Yes, sir.
The Chairman. I think that may be made exhibit No. 93.
(The document referred to was marked "Exhibit No. 93" for refer-
ence and may be found in the files of the select committee.)
The Chairman. You testified to the totals, generally, but I think
the worksheet should be made an exhibit.
Mr. Balaban. We also have some supports for these worksheets,
sir.
The Chairman. All right. The supports for the workslieets may
be made an exhibit in bulk. They will be made exliibit No. 94, the
supporting documents and the figures on the worksheets, the vouchers
and other evidence supporting the figures you have testified to.
(The documents referred to were marked "Exhibit No. 94" for
reference and may be found in the files of the select committee.)
The Chairman. They can be placed in one package; can't they?
Mr. Balaban. Yes, sir.
Mr. Kennedy. Did we find that Mr. William E. Maloney would
submit statements that he had spent so much money on a trip or a
voyage or for various kinds of expenses when it was completely un-
substantiated ?
Mr. Balaban. Tliat is correct, sir. They ran into a considerable
amount of money.
Mr. Kennedy. Did he, in fact, substantiate any of the expenses that
he had during the 7-year period ?
21243— 58— pt. 20 19
8206 IMPROPER ACTIVITIES IX THE Lu\BOR FIEILD
Mr. BalabxVN. No, they were just slips saying he spent so much
on this date for entertainment, hotel bills, and railroad, with no sub-
stantiation whatsoever.
Mr. Kennedy. And did we find, Mr. Gould, on a number of occa-
sions which we will go into in detail, that Mr. William E. Maloney
charged double and triple expenses for a trip that he might take ?
Mr. Gould. That is correct, sir.
Mr, Kennedy. That he would charge various organizations for the
same hotel room, for the same meal, or for the same trip; is that
right ?
Mr. Gould. That is correct, sir.
Mr. Kennedy. Included in the $742,228.20 are the yacht expenses
of $74,378.52 that we mentioned this morning; is that right?
Mr. Balaban. Tliat is correct, sir.
Mr. Kennedy. That was the yacht that was used for his personal
pleasure in Florida ?
Mr. Balaban. That is right.
Mr. Kennedy. You did not include in the figure the $35,000 for his
original purchase ; did you ?
Mr. Balaban. No, we did not; just the maintenance and salary of
the captain.
Mr. Kennedy. Include also is an apartment tliat the union main-
tained for William E. Maloney ?
Mr. Balaban. That is correct.
Mr. Kennedy. The headquarters of the Operating Engineers has
been here in Washington ?
Mr. Balaban. It has been here for many, many years.
Mr. Kennedy. Does Mr. Maloney keep a home in Chicago?
Mr. Balaban. He has a home, outside of Chicago, in Arlington
Heights, 111.
Mr. Kennedy. Does he have a home in Florida ?
Mr. Balaban. He does. He has one in Miami .
Mr. Kennedy. Does he keep an apartment here in Washington,
D.C.?
Mr. Balaban. Yes ; he does, sir.
Mr. Kennedy. Does the union pay for the apartment ?
Mr. Balaban. Yes, sir. I can give you the total for the 7 years.
It is $17,472.10.
Mr. Kennedy. Which the union has paid for his apartment here
in Washington, D. C. ; is that right ?
Mr. Balaban. That is correct.
Mr. KJENNEDY. And the apartment is not used by the union but is
used by him personally ?
Mr. Balaban. That is right. It is in his name, William E. Maloney.
]Mr. Kennedy. It is not a union apartment that visitors coming
into Washington, D. C, doing business with the Operating Engineers,
can stay in ? It is not that kind of an operation ; is that right ?
Mr. Balaban. I would say "No," sir.
Mr. KENNEDY. It is just his personal apartment ?
Mr. Balaban. I would say so ; yes, sir.
]\Ir. Kennedy. And the union has paid the rent on that apartment ?
Mr. Bal^vban. That is correct, sir.
Mr. Kennedy. Then he has racetrack memberships for himself ?
Mr. Balaban. Yes, sir ; he does.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8207
Mr. Kennedy. At what racetracks does he have niembersliip?
Mr. Balaban. We have a list here, sir.
Mr. Kennedy. Mr. Gould, do you have those ?
Mr. Gould. Yes, sir.
Mr. Kennedy. I^t me ask you if it is not correct, that he has had
membership at Hialeah, Gulf Stream, and Arlington Parlv ?
Mr. Gould. That is correct, sir.
Mr. Kennedy. And the union has paid those racetrack fees for him ?
Mr. Gould. Yes, sir.
Mr. Kennedy. And the total for the 7-year period for his racetrack
membership was $4,575 ?
Mr. Balaban. That is right, sir.
Mr. Kennedy. And has he also belonged to country clubs ?
Mr. Balaban. He belongs to several country clubs, but we have only
charged here — well, yes, sir.
Mr. Kennedy. He has belonged to country clubs ?
Mr. Balaban. That is correct, sir.
Mr. Kennedy. And that is a country club down in Florida ?
Mr. Balaban. That is right.
Mr. Kennedy. It is a country club right next to his home ?
Mr. Balaban. That is correct.
Mr. Kennedy. Has the union paid for that ?
Mr. Balaban. They have.
Mr. Kennedy. And there is a country club here in Washington,
D.C.?
Mr. Balaban. That is correct.
Mr. Kennedy. And the union has paid for his membership in that ?
Mr. Balaban. That is correct.
Mr. Kennedy. Can you tell us what the total of the country club
in Florida is ?
Mr. Balaban. The club dues for the LaGorce Country Club, the
total for the 7 years, is $4,140, just for the LaGorce Country Club.
Mr. Kennedy. lYliat about the other country club ?
Mr. Balaban. We didn't include the one here in Washington.
Mr. Kennedy. That is not included ?
Mr. Balaban. Not in this figure here; this is just the LaGorce
Country Club.
Mr. Kennedy. Is that included in the $353,000? That is not in-
cluded in the $353,000 ?
Mr. Balaban. It is a questionable figure.
Mr. Kennedy. That is the money received. This is a figure where
he received the money directly or the union paid bills of William E.
Maloney personally, either directly or indirectly.
Do you have the other country club? Is that included in the
$353,000?
Mr. Balaban. Yes ; in the miscellaneous item on page 2 of this sched-
ule, it is included.
Mr. Kennedy. You have broken down this $353,000 figure, Mr.
Balaban, into 2 figures?
Mr. Balaban. That is correct, sir.
Mr. Kennedy. Giving him the benefit of the expense payments
that he claims that he has undergone, and separating the items which
you would not consider legitimate payments, what do you find out
8208 IMPROPER ACTIVITIES EN THE LABOR FIELD
of the $363,650 figure to be considered as possibly legitimate items?
Mr. Balaban. Well, we were rather liberal in this, Mr. Kennedy.
We took out $182,539.90 and said that it is possible that they may
have been partly legitimate. But $171,116.17 we feel is not. That
includes the items on page 1 of the schedule.
Mr. Kennedy. That would include the country club next to his
home down in Florida, would it?
Mr. Balaban. That is correct, sir.
Mr. Kennedy. But it would not include the country club here in
Washington ?
Mr. Balaban. That is correct.
Mr. Kennedy. And that would include the racetrack membership ?
Mr. Balaban. That is right.
Mr. Kennedy. And the apartment?
Mr. Balaban. That is correct.
Mr. Kennedy. And the yacht expenses ?
And those expenses where you found that he had been paid double
or triple, twice, or three times for the same trip ; is that right ?
Mr. Balaban. That is right, sir.
(At this point. Senator Ervin entered the hearing room.)
Mr. Kennedy. I wonder if at this point, Mr. Gould, if you would
give us an example of where Mr. William E. Maloney has charged
double or triple for the same trip, or where he has received payments
for doing services that he did not perform.
Mr. Gould. Yes, sir.
Mr. Kennedy. You have taken 1 year ?
Mr. Gould. We have taken 1 year. The various conventions or
meetings that we took were those that he had attended in 1956.
Mr. Kennedy. Would you speak up ?
Mr. Gould. We are taking the various meetings he attended in 1956.
For instance, at Miami Beach, Fla., between February 1 and February
14 he attended an executive council of the building construction trades,
executive council of the metal trades and executive council of the
A.F.ofL.
The Chairman. Is that at Miami Beach?
Mr. Gould. Yes, sir.
The Chairman. Speak a little louder.
Mr. Kennedy. You will have to explain this as we go along, what
you are trying to develop.
Mr. Gould. All right, sir.
Mr. Kennedy. In 1956 he attended various conventions and made
various trips?
Mr. Gould. That is correct, sir.
Mr. Kennedy. We found, for instance, starting on February 1,
1956, there was an executive council meeting of the building and
construction trades department?
Mr. Gould. That is right.
Mr. Kennedy. And that was at the Monte Carlo Hotsl; is that
right?
Mr. Gould. Correct. For that, the building and construction
trades paid him $1,000.
Mr. Kennedy. They paid him $1,000 for attending that conference ?
Mr. Gould. Yes, sir.
IMPROPE'R ACTIVrriES IN THE Lu\BOR FIELD 8209
Mr. Kennedy. During that same period of time, did he receive his
expenses from the union?
Mr. Gould. He also received between February 1 and February 14
daily expenses from the union. That totaled $514. In addition,
he got
Mr. Kennedy. Let's take the first one, February 1 to 4, 4 days. He
received $1,000 for that?
Mr. Gould. That is right.
Mr. Kennedy, In the same period of time, for the 4 days, he had his
daily expenses paid by the union for $183 ; is that right ?
Mr. Gould. That is correct.
Mr. Kennedy. And in addition he had the other incidental expenses
paid, $56.54?
Mr. Gould. That is correct.
Mr. Kennedy. Now, did he declare any of this money on his in-
come-tax return ?
Mr. Gould. No, sir ; he did not.
Mr, Kennedy. So he received $1,000 from the executive council of
the building and construction trades department, plus getting ex-
penses, possibly legitimate expenses for staying 4 days at that hotel
paid for by the union, and none of this money including the $1,000
did he declare on his income-tax return.
Mr. Gould. That is correct.
Mr. Kennedy. So he received $1,000 from the union on that trans-
action.
Mr. Gould. That is correct.
Mr. Kennedy. He was down here at the same place on February
6 for an executive council meeting of the metal trades department.
Mr. Gould. That is correct.
Mr. Kennedy. For that he received $700.
Mr, Gould. From the IUOE.
Mr. Kennedy. And during that convention, from February 5 to 11,
a 7-day period, he received his expenses from the union ?
Mr. Gould. $187, yes.
Mr. Kennedy. Plus $10.94 for other incidental expenses.
Mr. Gould. That is correct.
Mr. Kennedy. Then there was another executive council meeting
of the AFL which was during the same period of time for which he
received another $700.
Mr, Gould, That is correct.
Mr. Kennedy. And he also received $144 as expenses from the
union, from the international union ?
Mr. Gould. That is right.
Mr. Kennedy. So from the dates of February 1 to 14, these 3 meet-
ings, he received $2,400 from these various organizations; is that
right?
Mr. Gould. That is correct.
Mr. Kennedy. But in addition to that he had his expenses paid
by the international union totalling
Mr. Gould. $581.48.
Mr. Kennedy. Those were his expenses for his hotel and for other
incidental expenses paid by the international union; on top of that
lie received $1,400, none of which he declared.
8210 IMPROPER ACTRITIES IN THE LABOR FIEILD
Mr. Gould. Yes, sir.
Mr. Kennedy. None of which he ever mentioned.
Mr. Gould. Yes, sir.
Mr. Kennedy. Which he received from the union ; is that right ?
Mr. Gould. That is correct.
Mr. Kennedy. So, Mr. Chairman, on that, we would inchide the
$2,400 fio-ure in our figure of $181,000, while the others we would
say were legitimate expenses.
The Chairman. I see.
Mr. Kennedy. Now, going on from April 9 to 13.
Mr. Gould. For that j^eriod, there was an lUOE convention in
Chicago, 111., at the Conrad Hilton. He received a check from the local
150 for $500.
Mr. Kennedy. That is under trusteeship and was at the time.
Mr. Gould. Yes, sir.
Mr. Kennedy. And under his control, therefore ?
Mr. Gould. Yes, sir.
Mr. Kennedy. And he received $500 from them.
Mr. Gould. That is correct. He also received $700 from the inter-
national making a total of $1,200.
Mr. Kennedy. That is $1,200 for that convention?
Mr. Gould. Yes, sir.
Mr. Kennedy. So he received money from the international and
for the same convention he received money from the local, local 150,
under trusteeship and therefore, under his direction.
Mr. Gould. That is right.
Mr. Kennedy. So he received double expenses there.
Mr. Gould. Yes, sir.
Mr. Kennedy. Did he also receive other expenses for the same
trip?
Mr. Gould. Yes, sir ; for the period April 9 to 13, he claimed daily
expenses and was paid a total of $255 for daily expenses.
Mr. Kennedy. Plus incidentals ?
Mr. Gould. Yes ; and the incidentals amounted to $92.81.
Mr. Kennedy. Making a total of what ?
Mr. Gould. $348.81.
Mr. Kennedy. So he received for that period of time trip expenses;
is that right?
Mr. Gould. That is correct.
Mr. Kennedy. He put in bills, or he had a regular amount of money
from the international organization to pay his expenses, and in addi-
tion to that he put in his expenses and then he received money from
local 150, which was under his direction and control.
Mr. Gould. That is correct, sir.
Mr. Kennedy. None of this money did he declare in his income tax.
Mr. Gould. No, sir. The next meeting was the executive council
of the building and construction trades meeting about May 31, in
Washington, D. C.
Mr. Kennedy. That is May 14 and 15 ?
Mr, Gould. Tlie general executiA'e board on May 14 and 15 was
held in Chicago, 111.
Mr. Kennedy. And he received $700 for that?
Mr. Gould. $700 from the lUOE.
IMPRiOPE'R ACTIVITIES IN THE LABOR FIELD 8211
Mr. Kennedy. Did he have a lot of expenses for that trip ?
Mr. Gould. Well, sir, the records showed he was in the hospital.
Mr. Kennedy. So he did not even attend the meetings,
Mr. Gould. Well, according to the hospital records.
The Chairman. The hospital where ?
Mr. Gould. In Chicago; yes, sir.
Mr. Kennedy. Do you have the records of the hospital ?
Mr. Gould. AVe don't have them Avitli us here on that one, sir.
Mr. Kennedy. The records are available ; are they not ^
Mr. Gould. They are available.
Mr. Kennedy. You have them in the office?
Mr. Gould. Yes, sir.
Mr. Kennedy. But tliej' show what time he registered in the
hospital ?
^Ir. Gould. That is correct.
Mr. Kennedy. And what time he got out of the hospital ?
Mr. Gould. That is correct.
Mr. Kennedy. And it shows he w\as in the hospital during the
period of time the convention was held ?
Mr. Gould. That is correct, sir.
Mr. Kennedy. Now tell me this: Did he nevertheless submit ex-
penses to the union for that visit in Chicago?
Mr. Gould. Hotel expenses, yes, sir.
Mr. Kennedy. Can we go on to that ?
Mr. Gould. On May 14 and 15 there was a room of $47.50 and a
restaurant charge of $5.61.
Mr. Kennedy. So he charged the union $52.61 for a room to attend
this convention and he also received $700 and during the whole period
of time he was in the hospital.
Mr. Gould. That is correct.
The Chairman. I assume none of that will be accounted for in his
income tax ?
]Mr. Gould. No, sir.
Mr. Kennedy. Now, going on to May 31.
Mr. Gould. On May 31, in Washington, D. C, there was an execu-
tive council of the building and construction trades department. For
that he received $1,000 from the building and construction trades.
The expense for May 31 only on his daily expense account Avas $21
that he claimed.
Mr. Kennedy. That executive council was held where ?
Mr. Gould. In Washington, D. C.
Mr. Kennedy. And the date of the council meeting was May 31 ?
Mr. Gould. That is correct.
Mr. Kennedy. And he received $1,000 for attending that meeting?
Mr. Gould. That is correct.
Mr. Kennedy. And $21 for other daily expenses ?
Mr. Gould. That is right.
Mr. Kennedy. Does it show where he was that day ?
Mr. Gould. His daily expense account shows from May 28 he went
from Chicago to Milwaukee and May 31 shows he was in Chicago and
he charged dinner and entertainment, $21, in Chicago.
Mr. Kennedy. So he charged $21 for dinner and entertainment in
Chicago while he received another $1,000 for being in Washington,
D.C.
8212 IMPROPER ACTIVITIES EST THE LABOR FIELD
Mr. GoTiLD. That is correct.
Mr. Kennedy. Attending that meeting.
Mr, Gould. Yes, sir.
Mr. Kennedy, And again none of this was declared on his income
tax.
Mr. Gould. That is correct, sir. Shall I continue ?
Between the period of August 22 and August 30, he attended meet-
ings at Stroudsburg, Pa., and Forest Park, Pa. I understand they
are close by. He received $1,000 from the executive council of the
building and construction trades.
Mr. Kennedy. That convention was from August 21 to August 25 ;
is that right ?
Mr. Gould. Yes, sir.
Mr. Kennedy. And another $500 ?
Mr. Gould. From the executive council.
Mr, Kennedy. From the lUOE, that was for attending the execu-
tive council of the AFL.
The Chairman. That was August 26 to August 27 ?
Mr. Gould. That is correct, sir. In addition to that, he was paid
daily expenses totaling $326 and in addition to that his hotel room at
the Penn-Straude Hotel was paid not only for him, but for his
chauffeur, also, and for the car.
Mr. Kennedy. How much was it for his chauffeur ?
Mr. Gould. The chauffeur was only $23.26.
Mr. Kennedy. How much was the total ?
Mr. Gould. The total of that was $417.83.
Mr. Kennedy. Wliich was for the 7-day period ?
Mr. Gould. That is correct.
Mr. Ivennedy. Those were the expenses that the union paid and in
addition the international union gave him $500 and the building and
construction trades department gave him another $1,000?
Mr. Gould. That is correct.
Mr. Kennedy. None of this did he declare ; is that right ?
Mr. Gould. That is right.
The next one was on September 23 ; he went to Atlantic City and
attended an executive council of the Metal Trades. The interna-
tional paid him $700 for that meeting ajid we have covered in our
daily expenses from September 23 to September 27 and the payments
on that were $255 for daily expenses and the payment for hotel
bills was $245.51, making a total payment in addition to the $700
of $500.51.
JSIr. Kennedy. That was for a 4-day period ?
Mr. Gould. Well, that is right, September 23 to 27.
Mr. Kennedy. He received $700 from the international to pay
his expenses and then in addition he submitted his expenses for
which a total of over $500 — it was over $100 a day, none of which
he declared in his income tax.
Mr, Gould. That is correct.
Mr. Kennedy. Mr. Chairman, I wanted to bring out the amount
that he received, the fees that he received for attending these meet-
ings, makes a total for 1956 of how much ?
Mr. Gould. $7,500.
Mr. Kennedy. And the total that he received on top of that for
attending these meetings was what ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8213
Mr. Gould. $1,922.24.
The Chairman. That was presumably his expenses actually paid
by the union, his actual expenses ?
JNIr. Gould. That is correct.
The Chairman. So he made in that brief period of time, $7,500 net
profit at least, from these charges against the lUOE and also from
the local ?
Mr. Gould. Yes, sir.
The Chairman. None of that was accounted for as income?
Mr. Gould. No, sir.
The Chairman. This worksheet that you have, do you have a copy
of this before you ? That is the worksheet on which you made these
calculations, that may be made exhibit No. 95.
(The document referred to was marked "Exhibit No. 95" for ref-
erence and may be found in the files of the select committee.)
Mr. Kennedy. Now, that type of item, the $7,500 type of item
would be included in the $171,000 figure that you arrived at, while
the $1,922.24 would not be included.
Mr. Gould. That is correct.
JMr. Kennedy. You are giving him the benefit of all of those ex-
penses, even though you know that some of the expenses were charged
when he was not even in the city where they were charged ?
Mr. Gould. That is correct.
Mr. Kennedy. And obviously, some of them were not legitimate, but
you have given him the benefit of the doubt on all of those expenses
anyway ?
Mr. Gould. Yes, sir.
Mr. Kenndy. In addition to that there is this $7,500.
Mr. Gould. Yes, sir.
Mr. Kennedy. Could you tell the committee what you found going
through this kind of a study and investigation for each year? For
1956 you had a $7,500 figure and can you give the committee what
you found where there is double and triple expenses for each year
starting in 1950 without going through each item ?
Mr. Gould. All right, sir.
The Chairman. Let me make the supporting documents that you
have, the canceled checks and other documents supporting these figures
that you have testified to, exhibit No. 96. Those supporting documents,
checks, and vouchers and so forth, may be made exhibit No. 96, a
package exhibit.
(The documents referred to were marked "Exhibit No. 96" for ref-
erence and may be found in the files of the select committee.)
The Chairman. Proceed.
Mr. Gould. We selected one meeting for each year for the period
1950-55, to see if the pattern was the same as it is in 1956. For in-
stance, in 1950 we took Houston, Tex. The meeting was held at the
Shamrock Hotel.
The Chairman. Proceed.
Mr. Gould. The meeting was held in Houston, Tex. He received
$700 from the lUOE and $1,000 from the building and construction
trades and then for the convention of September 25, he received another
$700 or a total of $2,400.
8214 IMPROPER ACTIVITIES IN THE LABOR FIELD
During that period of time, from September 18 to the 25, he re-
ceived in daily expenses a total of $591, and the hotel bills totaled
$720.83.
Mr. I^NNEDY. Making a total of what ?
Mr. Gould. About $1,300, sir.
Mr. IvENNEDY. That was for about 8 days ?
Mr. Gould. Yes, just about that.
The Chairman. About 8 days and he had how much hotel expense?
Mr. Kennedy. And he had c. o. d. packages, as well ?
Mr. Gould. The hotel bills total $720, and included in the hotel bills
was one item c. o. d., a package for $157.50. And then he had drug-
store expenses, the beauty parlor of $8 was in there, making a total of
$207.25.
The Chairman. Do the records show whether Mrs. Maloney accom-
panied him on that trip ?
Mr. Gould. I believe so, sir. I am speaking from memory.
The Chairman. I suppose that beauty parlor expense was ac-
counted for in that.
Mr. Gould. Yes, sir.
Mr. Kennedy. Y/hat is the total there ?
Mr. Gould. $1,311.83.
The Chairman. He received that presumably for his actual ex-
penses, hotel bills, and hotel accommodations, and such things as he
charged at the hotel. In addition to that, he received $2,400 from the
union and the local ?
Mr. Gould. That is correct, sir.
The Chairman. Well, now, none of that was reported in his income
tax?
Mr. Gould. No, sir.
The Chairman. So he is getting around $300 a day and all expenses
in addition to his salary of $50,000 a year?
Mr. Gould. That is correct, sir.
Mr. Kennedy. Can you give us an example in 1951 ?
Mr. Gould. In 1951, we selected Miami Beach, Fla. The meeting
there was held at the Robert Richter Hotel, and he received $700
for attending the executive council metal-trades department.
That was paid by the lUOE, and he received another $700 for attend-
ing the executive council of the AFL, and that is from the lOEU, and
then he received $1,000 for attending the executive council of the
building and construction trades department.
The Chairman. From whom did he receive that $1,000 ?
Mr. Gould. From the building and trades department, AFL-CIO.
(At this point, the following members are present: Senators Mc-
ClellanandErvin.)
The Chairman. That is over a period of how many days ?
Mr. GouTLD. That is a period from January 16 to January 21. Dur-
ing the period of January 17 to February 1, he was paid daily expenses
by the lUOE of a total of $611, and his hotel bill totaled $1,026.86.
We broke that down into a room of $927.
The Chairman. For how many days ?
Mr. Gould. From January 15 to February 4.
The Chairman. January 15 to February 4?
Mr. Gould. That is right.
The Chairman. That is about $50 a day for a hotel room ?
EVIPROPE'R ACTIVITIES IN THE LABOR FIELD 8215
Mr. Gould. Just about, sir.
Mr. Kennedy. What was the total of his expenses, phis the hotel ?
Mr. Gould. $1,637.86.
Mr. Kennedy. That is about $100 a day ?
Mr. Gould. Just about, sir.
Mr. Kennedy. Just about, sir.
Mr. Kennedy. In addition to that, he got $2,400 ?
Mr. Gould. Tliat is correct.
Mr. Kennedy. Neither the $2,400 nor the $100 a day did he declare ?
Mr. (jouLD. No, sir. In 1952 we selected Seattle, Wash. There was
a convention between April 9 and 18. For this convention, he re-
ceived $2,000 from local 150, which is the Chicago local, and he re-
ceived $700 from the international in Washington. During the period
of April 6 to the 18th, he received a total of $376 in daily expenses,
plus $513,50 in hotel expenses being; paid for him.
Mr. Kennedy. What is the total 'i
Mr. Gould. $889.50.
The Chairman. So he got $2,700 for that period of time?
Mr. Gout^d. That is correct, sir.
The Chairman. That is about liow many hundred dollars a day ?
Mr. Kennedy. That is April 9 to the 13th, is it ? Is that right ?
Mr. Gould. xVpril 9 to 13.
The Chairman. That was over $500 a day he was charging there,
is that correct ?
Mr. Gould. That is correct, sir.
The Chairman. Plus all of these other expenses ?
Mr. Gould. Yes, sir.
Mr. Kennedy. He was getting $200 in the other expenses a day, and
from the other payment he was getting about $500 a day.
Mr. Gould. That is correct.
Mr. Kennedy. So he was getting about $700 a day ?
Mr. Gould. Yes, sir.
The Chairman. Besides his actual expenses ?
Mr. Kennedy. No, that is including expenses. And none of this
did he declare ?
Mr. Gould. That is right. For 1953 we selected one meeting at
St. Louis, Mo. The meeting was held at the Jefferson Hotel. He
received $1,000 from the building and construction trades for attend-
ing the executive council of the building and construction trades de-
partment. He received $700 from the lUOE for attending the con-
vention of the metal trades department, and he received $700 from
the lUOE for attending the convention, the A. F. of L. convention.
That covered a period of September 13 to September 25. For the
period September 13 to September 26, he received in daily expenses,
paid by the lUOE, a total of $687, and his hotel bill for that period
paid by the lUOE amounted to $780.08, or a total of $1,477.08.
The Chairman. That was in addition to the $2,400 ?
Mr. Gould. That is correct, sir.
The Chairman. And none of which was declared ?
Mr. Gould. That is right.
The Chairman. All right.
Mr. Gould. For 1954 we selected New York City, their meeting at
the Commodore Hotel, between August 4 and August 12. It was an
8216 IMPROPEiR ACTIVITIES IN THE LABOR FIEILD
executive council of the buiding and trades,
the executive council of the metal trades department; he received
$700, paid by the lUOE. He received another $700 from the executive
council metting of the A. F. of L. That totals $2,400. His daily
expenses for the period 8-4 through 8-13, which was paid by the
lUOE totaled $444.
In addition to that, the international paid his hotel bills at the
Commodore Hotel, and Hotel New Yorker, a total of $456,34, or a
grand total of $934.00.
Mr. Kennedy. He got that $800 for his regular expenses and in
addition he got the $2,400 ?
Mr. Gould. That is correct, sir.
Mr. Kennedy. And he did not declare either amount, is that cor-
rect ? He didn't declare $900 or the $2,400, is that right ?
Mr. Gould. That is right, sir. In 1955 we selected the meeting in
Chicago at the Conrod Hilton. He received $700 from the lUOE,
for the executive council meeting, and he received $1,000 from the
building and construction trades department. He received an addi-
tional $700 from the lUOE for the executive council meeting of the
A.F.ofL.
During the period 8-2 through 8-12, his daily expenses totaling
$685, were paid by the international, and the hotel bill at the Conrod
Hilton, from 8-2 to 8-12, totaling $345.71 was j^aid by the union.
That gives a total amount of $1,030.71.
The Chairman. This sheet, Mr. Gould, that you worked this out
on, as you have testified to, may be made exhibit No. 97, and your
supporting documents thereto may be made a package exhibit, exhibit
98.
(The documents referred to were marked "Exhibits Nos. 97 and 98"
for reference and may be found in the files of the Select Committee) .
The Chairman. I notice on this sheet that you have just been test-
ifying to, that it covers the years 1950 through 1955.
Mr. Gould, That is right.
The Chairman. But you have not included here all that you found
You have only taken these, as I understand it, as samples of what you
found in those years ?
Mr. Gould. That is correct, sir.
The Chairman. In other words, there is much more?
Mr. Gould. Yes, sir.
The Chairman. But this simply shows or indicates how the racket
was run, is that right ?
Mr. Gould. Yes, sir.
The Chairman. You do have the other figures, and you used those
in your calculations to reach the grand total ?
Mr. Gould. Yes, sir. We used those amounts in the grand total.
The Chairman. I mean other occasions during these years when he
duplicated his accounts, and so forth ?
Mr. Gould. Yes, sir.
The Chairman. You have those and you have included them in your
total?
Mr. Gould. That is right.
The Chairman. But you just present this sheet and these instances
as samples or typical of the racket that was being carried on ?
Mr. Gould. That is correct, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8217
Mr. Kennedy. Mr. Gould, have you in fact broken down the figures
wliere he received his expenses from the union ? Do you liave the fig-
ures where he received moneys over and above that which you have
given in your examples here today ?
You have it broken down to 1956. You gave us the whole situation
as far as 1956, and the total there was $7,500; is that right?
Mr. Gould. That is right, sir.
Mr. Kennedy. He received legitimate expenses above that, but he
received $7,500 flat; right?
Well, have you broken it down that way, where he received the
double and triple expenses ?
Mr. Gould. Yes, sir.
Mr. Kennedy. It was $7,500 in 1956. What was it in 1955 ?
Mr. Gould. For the total of 1950 through 1956, it amounted to
$69,100. Of that $69,100 he received $27,000 from the building and
construction trades department of the A. F. of L.
He received for convention expenses, the lUOE paid him a total of
$3,300, and local 150 for convention expenses paid him $2,500.
Mr. Kennedy. That is what he got paid by the lUOE and by local
150. But it is not the expenses that you are talking about here in the
right-hand column, where he would submit a voucher for the hotel, or
submit a voucher for entertainment or that kind of thing. This is just
a flat payment.
Mr. Gould. A lump-sum payment, sir.
Mr. Kennedy. And this is where he was already paid by the inter-
national union for these expenses. This is over and above the expenses
for which he was paid ; right ?
Mr. Gould. That is correct, sir.
The Chairman. And over and above his regular annual salary of
$50,000 a year?
Mr. Gould. Yes, sir.
Mr. Kennedy. So he received $26,000 from the A. F. of L. meet-
ings, $10,100 from the lUOE general executive board meetings, is
that right?
Mr. Gould. That is right.
Mr. Kennedy. And both of those figures were paid by the Inter-
national Union of Operating Engineers ?
Mr. Gould. That is correct.
Mr. Kennedy. Pie got $27,000 from the building and construction
trades department ?
Mr. Gould. That is correct.
Mr. Kennedy. $3,300 directly by the lUOE ?
Mr. Gould. Eight.
Mr. Kennedy. And $2,500 by local 150, which is under his direc-
tion and control ?
Mr. Gould. That is correct, sir.
Mr. Kennedy. That makes a total of $69,100, is that right?
Mr. Gould. That is correct.
Mr. Kennedy. That is over and above the expenses he would sub-
mit for his hotel and for his entertainment ?
Mr. Gould. That is correct.
Mr. Kennedy. Now would you submit to the chairman and to the
committee the kind of vouchers he would submit, even for what we
have allowed for authorized or proper expenses ?
8218 IMPROPER ACTRITIES IN THE LABOR FIEILD
Did he ever have any substaiitiation at all for any of these
expenses ?
Mr. Gould. No, sir.
Mr. Kennedy. Even the ones that w'e are allowing, did he ever
have any substantiation for those?
Mr. Gould. No, sir. He made out a weekly expense account in
which he just wrote down, for example, and I am quoting from one
here, "Dinner and entertainment, $27", or on January 22, he said
"Executive board dinner and entertainment, executive board mem-
bers, $87."
"January 23, dinner and entertainment, $19."
January 24, dinner and entertainment, executive board, $29."
"January 25, dinner and entertainment, executive board meeting,
$41."
Mr. Kennedy. But there were no vouchers for them at all?
Mr. Gould. No, sir.
Mr. Kennedy. Would you let the committee see some of those?
The Chx\irman. This worksheet showing the amounts received
from each source that you have testified to may be made exhibit
No. 99.
(The document referred to was marked "Exhibit No. 99" for ref-
erence, and may be found in the files of the select committee.)
Mr. Kennedy. Based on this kind of vouchers
The Chairman. Let this voucher be made exhibit No. 100, this
sample.
(The docmnent referred to was marked "Exhibit No. 100" for ref-
erence and will be found in the appendix on pp. 8316-8317.)
Mr. Kennedy. Based on this kind of vouchers, with no substanti-
ation, and allowing him all of that, we get a total of $182,539.90,
based on this kind of vouchers, is that correct?
Mr. Gould. That is correct, sir.
Mr. Kennedy. That would be giving him expenses in 1950 of
$32,187.69 ?
Mr. Gould. That is correct.
Mr. Kennedy. 1951, $22,262.20; 1952, $29,002.23; 1953, $25,103;
1954, $33,803.84 ; 1955, $24,808.35 ; 1956, $15,272.49.
Is that correct ?
Mr. Gould. That is correct.
Mr. Kennedy. That is over and above his $50,000 or $55,000 salary ?
Mr. Gould. Yes, sir.
Mr. Kennedy. On top of all of that are all of these other expenses
which you have outlined, totaling another $171,110.17 ?
Mr, Gould. Yes, sir.
The Chairman. Do you identify this photostatic copy as being
accurate with respect to the figures you have testified to about those
totals?
(The document was handed to the witness.)
Mr. Gould. Yes, sir.
The Chairman. That one is already an exhibit. Well, they are
all in.
Mr. Kennedy. We have some more items to break down.
The Chairman. The Chair wishes to make this observation with
respect to this testimony so that the record may reflect the importance
and the significance of it. All of this money, all of these expendi-
IMPROPER ACTIVITIES IN THE LABOR FIELD 8219
tures, came out of union funds, out of union dues, either from the local
or from the international. All of those funds are tax exempt. The
revenue department does not examine the books of unions, their
records and financial records, Avith respect to how the money is used,
how it is spent, whether it is for union purposes or not.
It has not done so up to now. There has been a question under
existing law whether they had the authority to do so, because those
funds are tax exempt.
The question arises as to whether the law is adequate. This testi-
mony here, and the operation that you have listened to, clearly demon-
strates how easy it is under the circumstances, and in an operation of
this kind, for someone to get hundreds of tliousands of dollars, as in
this instance, out of tax-exempt funds, and use those funds for his
personal use. Thus, no taxes are paid on them, and such people
escape their share of financial support for this Govermnenc, and thus
become a favored class by taking tax-exempt union dues and convert-
ing them into a source of income for personal gain and profit.
I think it clearly shows that in this area some legislation is needed
to stop up these loopholes and to require proper accounting, proper
reporting, and to prevent those who would be crooked and dishonest
in their trusted positions as officers of unions, to prevent them from
looting and pilfering the funds that belong to the union men who pay
the dues and who do the work.
I think this testimony is quite important and will give Congress
some information so that it will know where and how to legislate,
not only to protect the Government in revenues that it is entitled to
receive, just as other taxpayers pay their taxes, but also to protect
the union men, union members, from this character of exploitation.
Is there anything further ?
Mr. Kennedy. I want to call Miss Leahy now, Mr. Chairman,
Cecelia Leahy, the bookkeeper at the international union. She might
throw some further light on this matter.
The Chairman. Miss Leahy, will you be sworn ?
You do solemnly swear that the evidence you shall give before this
Senate select committee, shall be the truth, the whole truth and
nothing but the truth, so help you God ?
Miss Leahy. I do.
TESTIMONY OF ELIZABETH CECLIA LEAHY
The Chairman. Miss Leahy, will you state your name, your place
of residence, and your business, occupation or empjoyment, please?
Miss Leahy. Miss Elizabeth Cecelia Leahy, Silver Spring, Md.,
bookkeeper for the International Union of Operating Engineers.
The Chairman. Bookkeeper for the International Union of Oper-
ating Engineers ?
Miss Leahy. That is correct.
The Chairman. Miss Leahy, do you waive the right of counsel to
be present while you testify ?
Miss Leahy. I do.
The Chairman. Thank you very much. How long have you been
in the employ of the lUOE as a bookkeeper here in Washington ?
Miss Leahy. Well, as a bookkeeper, since 1942.
The Chairman. A bookkeeper since 1942 ?
8220 IMPROPER ACTIVITIES IN THE LABOR FIEJLD
Miss Leahy. Yes, but I have been employed there since 1929.
The Chairman. Since 1929?
Miss Leahy. Yes,
The Chairman. You have been a bookkeeper for the union, the
international union, during the period of 1950 through 1957?
Miss Leahy. That is correct.
The Chairman. Thank you very much. All right, Mr. Kennedy.
Mr. Kennedy. In that capacity, you are familiar with various of
the expenses of Mr. William E. Maloney ?
Miss Leahy. Yes ; I am.
Mr. Kennedy. You kept the books and records which would indicate
and show those expenses ?
Miss Leahy. Yes ; I did.
Mr. Kennedy. Did you receive any instructions regarding the noti-
fication to the Internal Kevenue Department that Mr. Maloney was
incurring those expenses ?
Miss Leahy. Yes ; I did.
Mr. Kennedy. What instructions did you receive, and from whom ?
Miss Leahy. I received the instructions from Mr. Maloney.
The Chairman. From whom ?
Miss Leahy. From Mr. Maloney. It was not to report any expenses
to the internal revenue, other than his board checks.
The Chairman. Not to report any expenses to the internal revenue
other than what ?
Miss Leahy. His general executive-board expense checks.
The Chairman. Other than the general executive-board expense
checks ?
Miss Leathy. And then they were only from 1955.
The Chairman. What?
Miss Leahy. The executive-board expense checks were from 1955
to the present date.
The Chairman. And they did not even report that before ?
Miss Leahy. I did not understand you.
The Chairman. You have only reported executive-board expenses
since 1955 ?
Miss Leahy. That is correct.
The Chairman. Prior to that time, you did not report them?
Miss Leahy. That is correct.
Mr. Ivennedy. And you prepared the withholding-tax forms for
the officers and employees of the international union; is that correct?
Miss Leahy. Yes.
Mr. Kennedy. Based on those instructions from William E. Ma-
loney, you did not report the other moneys he was receiving?
Miss Leahy. That is correct.
Mr. Kennedy. Did you make any notation at the time on your rec-
ords that these moneys that Mr. Maloney was receiving should not
be reported to the Internal Revenue Department ?
Miss Leahy. Yes ; relative to his expenses.
The Chairman. I hand you here what appears to be a photostatic
copy of a ledger sheet, showing general executive-board meetings
(defense fund), and it shows 1 entry in there of $700. I ask you to
examine this photostatic copy and state if you identify it, and state
what it is.
(The document was handed to tlie witness.)
IMPRiOPE'R ACTIVITIES IN THE LABOR FIELD 8221
Miss Leahy, Yes. It is expenses for general executive-board
meeting, of $700, November 16, 1950.
The Chairman. November 16, 1950?
Miss Leahy. Yes.
The Chairman. I see a notation in the ri^ht-hand corner of that
ledger sheet, a typed notation. Will you read it, please ?
Miss Leahy (reading) :
This is not to be posted to personal accounts, per W. K. M., 1-28-49, by tele-
phone from Florida.
The Chairman. He telephoned you from Florida not to report it?
Miss Leahy. No ; not to post it to his personal account.
The Chairman. Not to report it as part of his personal account?
Miss Leahy. That is correct.
The Chairman. Was that $700 just a flat payment?
Miss Leahy. Yes ; it was.
The Chairman. There wasn't any bill for expenses or anything,
but it was just a check, presumably, to cover expenses ?
Miss Leahy. That is correct.
The Chairman. You take withholding tax only from the personal
accounts ; is that correct ?
Miss Leahy. Only from salaries.
The Chairman. From the salaries ?
Miss Leahy. Yes, sir.
The Chairman. From any income actually paid to him as salary ?
Miss Leahy. That is correct.
The Chairman. So, it was not posted so as to reflect that with-
holding tax was due on it ?
Miss Leahy. I don't understand that. Senator.
The Chairman. Well, you did not place it in the same category
as salary that he received ?
Miss Leahy. This was not salary. It was expenses.
The Chairman. It is marked "Expenses."
Miss Leahy. That is correct. That is how it was given to me, as
expenses.
The Chairman. But there was no statement of any expense to sup-
port it?
Miss Leahy. That is correct.
The Chairman. Tliat photostatic copy may be made exhibit 101.
(The document referred to was marked "ifixhibit No. 101" for ref-
erence, and Avill be found in the appendix on p. 8318.)
The Chairman. I present you another similar photostatic copy of
a ledger sheet entitled "A. F. of L. Expenses, Defense Fund." I ask
you to examine this photostatic copy and see if you identify it.
(The document was handed to tlie witiiess.)
Miss Leahy. Yes: I do.
The Chairman. Tliat is a photostatic copy of tlie original, and you
recognize it as such ?
Miss Leahy. Yes: I do.
The Chairman. It may be made exhibit No. 102.
(The document referred to was marked "Exhibit No. 102" for ref-
erence and will be found in the a])pendix on p. 8319.)
The Chairman. What is the notation in the right-hand corner of
that ledger sheet ?
21243— 58— i)t. 20 20
8222 IMPROPER ACTrV^ITIES IN THE LABOR FIE[LD
Miss Leahy (reading) :
Not to be posted to the accounts per W. E. M., verbal instructions by telephone
from Florida, 1-28-48, to CL.
The Chairman. How many items of expenses are listed there, and
the total ?
Miss Leahy. Do you mean just for Mr. Maloney ?
The Chairman. Just for Mr. Maloney.
Miss Leahy. There are five.
The Chairman. Five separate ones? Just read the amounts of
them.
Miss Leahy. $700, $700, $700, $700, and $700— they are all for
$700.
The Chairman. $3,500 listed there as blanket expenses ?
Miss Leahy. That is correct.
The Chairman. And there was no reporting of withholding tax
on that money ?
Miss Leahy. That is correct.
The Chairman. The purpose of that is so that it will not have to
be accounted for in his income tax, isn't that correct ?
Miss Leahy. Well, of course, Senator, we don't take withholding
tax out of expense money anyway. Withholding is only taken out of
salaries.
The Chairman. I know you don't. I am not blaming you, you
were only carrying out your job in auditing. They issue a check and
call it expenses, but it may actually be income and not expenses, be-
cause there is no voucher submitted for it. You understand what I
mean.
Miss Leahy. Yes, sir.
The Chairman. In other words, it may be a false entry that it is not
actual expenses, but it is income just the same as salary would be.
Miss Leahy. Yes, sir.
The Chairman. That has already been made an exhibit. Did you
have a separate sheet, as those indicate, for these flat expenses, we will
call them, where there was just a lump-sum payment?
Miss Leahy. That is correct.
The Chairman. You had a separate sheet in the ledger for those?
Miss Leahy. That is correct.
The Chairman. Did you have another sheet for the expenses where
a voucher was submitted, where it appeared to be actual expenses?
Miss Leahy. Yes ; I did.
The Chairman. I hand you here a series of four ledger sheets, ap-
parently recording the actual expenses, where vouchers were sub-
mitted and where they were paid.
Will you examine those four photostatic copies and state if you
identify them ?
(The documents were handed to the witness.)
Miss Leahy. Yes.
The Chairman. Those may be made exhibit No. 103.
(The document referred to was marked "Exhibit No. 103," for
reference and may be found in the files of the select committee.)
Mr. Kennedy. Would you read the notation on the top of that ?
Miss Leahy (reading) .
Do not report any expense to Internal Revenue, per TV. E. M. verbal in-
structions to Cecelia in person, 12-9-48 —
IMPROPFJR ACTIVITIES IX THE LABOR FIELD 8223
and over in the corner it says —
O. K. to report GEB checks for expenses and back board expenses on form
1019, per W. E. M. and Bansley, 12-22-55.
Mr. Kennedy. That was in 1953 that you started ?
Miss Leahy. In 1955.
Mr. Kennedy. That you started to report these expenses ?
Miss Leahy. That is right.
Mr. Kennedy. As a general proposition, you got tlie instructions —
and I quote again :
Do not report any expense to Internal Revenue per W. E. M.
Who is he ?
Miss Leahy. Mr. Maloney.
Mr. Kennedy. Mr. William E. Maloney —
Verbal instructions to Cecelia in person, 12/9/48.
That started back in 1948.
Miss Leahy. That is correct.
Mr. Kennedy. That is all.
Senator Ervin. I am rather intrigued as to why they called this
fund from which Mr. Maloney was receiving these flat expenses
defense funds.
What was it set up to defend ?
Miss Leahy. Any executive board meetings or any kind of meet-
ings like that, conventions, are taken out of defense funds.
Senator Ervin. What I am intrigued about is why they call them
■defense funds.
Miss Leahy. I don't know that.
Senator Ervin. They would seem to be apt to call it president's
extravagance fund, it seems to me.
Miss Leahy. I don't name the fund; the office does that. I just
work there.
Senator Ervin. Thank you.
Mr. Kennedy. I would like to call Mr. Bansley.
The Chairman. Will you be sworn, please ?
You do solemnly swear that the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and noth-
ing but the truth, so help you God.
Mr. Bansley. I do.
TESTIMONY OF JAMES R. BANSLEY
The Chairman. Be seated and state your name, your place of resi-
•dence, and your business or occupation.
Mr. Bansley. My name is James R. Bansley, and I am a certified
public accountant, with offices at 128 North Well Street, Chicago, 111.
The Chairman. Do you waive right to counsel, Mr. Bansley ?
Mr. Bansley. Yes, sir.
The Chairman, Proceed.
Mr. Kennedy. You are with the Operating Engineers, Mr. Bansley ?
Mr. Bansley. I am the accountant that does the auditing for the
local 150 and 39, Mr. Kennedy.
Mr. Kennedy. How long have you been with them ?
Mr. Bansley. Oh, I think back in the early 1930's.
8224 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. You were brought in by Mi\ Maloney ?
Mr. Bansley. Yes ; I was hired by Mr. Maloney.
Mr. Kennedy. And you make the audit of these two locals that are
under trusteeship ?
Mr. Bansley. That is right.
Mr. Kennedy. Do you do any other work for the union ?
Mr. Bansley. Yes ; we audit the welfare fund of local 150.
Mr. Kennedy. And anything further?
Mr. Bansley. Well, now, for the union, we do the auditing, and I
don't know what you mean by any further material.
Mr. Kennedy. Any other locals, or do you do any work for the
international ?
Mr. Bansley. We do no work for the international and no work for
any other locals.
Mr. Kennedy. You also do some of the auditing work or prepare
the income tax returns for Mr. William E. Maloney ?
Mr. Bansley. Yes, sir. I did.
Mr. Kennedy. Do you get paid for that work by local 150 of Mr.
William E. Maloney ?
Mr. Bansley. Well, up to this time I haven't billed anybody for it,
Mr. Kennedy.
Mr. Kennedy. You are paid by local 150 ?
Mr. Bansley. I am paid by local 150 for the services I rendered to
them.
Mr. Kennedy. And William E. Maloney for the services you render
to him, he does not pay you anything ?
Mr. Bansley, That is a gratuity^ let us call it.
Mr, Kennedy, You prepared his income tax returns from 1950
through 1956; is that right?
Mr, Bansley, Yes, sir.
Mr. Kennedy, In my conversations with you in the noon hour, you
stated that the Internal Revenue Department raised a question about
the expenses of Mr, Maloney received durnng 1950 and 1951 ; is that
correct ?
Mr. Bansley, That is right,
Mr. Kennedy, What steps did you take then to find out what
expenses he had received ?
Mr, Bansley, Well, I either called or wrote to the international
office, and asked them to advise me of the total amount of expenses that
Mr. Maloney received in the years 1950 and 1951.
Mr. Kennedy. Wliat did you find out, or what report came back to
you from the international ?
Mr. Bansley. I received a letter from them, as I remember, with
$10,000 showing as expenses in 1950, and $11,000 in 1951, or it may
have been vice versa, but it was around that figure for each of the
years.
Mr, Kennedy, How much was he declaring in income from the
international at that time, from the union at that time ?
Mr, Bansley, Well, he was declaring, as I recall it — your figures
are perhaps more accurate tlian my memory — $55,000, or the neigh-
borhood of $55,000,
Mr, Kennedy, And in botli years, approximately $55,000 ?
Mr, Bansley, I would tliink so. And in 1950 and 1951 it may
have been $5,000 less.
IMPROPER ACTIVrTIES IN THE LABOR FIELD 8225
Mr. Kennedy. "\^'liat were you trying to find out ; what above that
he was receiving from the union ?
Mr. Bansley. Yes, sir ; his reimbursed expenses.
Mr. Kennedy. Did you find out what it was in 1950 ?
Mr. Bansley. It was either $11,000 or $10,000.
Mr. Kennedy. How much was it in 1951 ?
Mr. Bansley. If it was $11,000 in 1950, it was $10,000 in 1951.
Those were the two figures.
Mr. Kennedy. Mr. Bahiban, based on our investigation, how much
did we find tliat Mr. Maloney received from the union during that
period of time, over and above the salary that he reported ?
Mr. Balaban. $53,792.03 in 1950, and $44,023.30 in 1951.
The Chairman. That is over and above all that he reported in
salary and expenses ?
Mr. Balaban. Yes.
The Chairman. Those figures that he gave, $53,000 one year and
$44,000 another year, are the amounts we have found over and above
the total amount lie reported for those years.
Mr. Kennedy. Did you know anything about that ?
Mr. Bansley. No ; I did not.
Mr. Kennedy. Are you surprised and shocked to hear it ?
Mr. Bansley. I am very much surprised that your figures would
come anywhere near, let us call them, the boxcar figures that have
appeared here today.
Mr. Kennedy. You did not know anything about it ?
Mr. Bansley. I knew nothing about these expenses at the inter-
national union,
Mr. Kennedy. Had you been told by Mr. Maloney about these
expenses ?
Mr. Bansley. I knew that he was getting expenses.
Mr. Kennedy. Had you been told about these other payments that
had been made to Mr. Maloney ?
Mr. Bansley. What do you mean by other payments ?
Mr. Kennedy. Payments for double and triple expenses.
Mr. Bansley. I liad no knowledge of what was going on in the
international union.
Mr. Kennedy. Did you ask him to find out what these figures were?
Mr. Bansley. I didn't know they existed, and so I couldn't very Avell
ask him.
Mr. Kennedy. Did you ask him for all of the money he was receiv-
ing from the international ?
Mr. Bansley. I am sure that I must have, and I couldn't have in-
telligently filed his return if I didn't,
Mr. Kennedy. And the income tax returns are based on the figiu-es
he gave you ?
Mr. B^ansley. Yes, and the information was furnished to me, and on
the basis of that, I filed his return,
Mr. Kennedy, So that this information was not made available to
you, and this information that has been testified to today was not made
available to you by Mr, Maloney ?
Mr, Bansley, No,
Mr. Kennedy. That is correct ?
Mr. Bansley, That is correct.
8226 IMPROPER ACTIVITIES m THE Ll\BOR FIELD
The Chairman. You have not gone over the books of the inter-
national ?
Mr. Bansley. That is right.
The Chairman. And you have simply taken the information sup-
plied you by the international, and by Mr. Maloney, upon which to
base your calculations of his return ?
Mr. Bansley. That is right, Senator.
The Chairman, And you had no knowledge of these other incomes ?'
Mr. Bansley. I had no knowledge that they were of the amounts
as indicated. I knew Mr. Maloney was getting some reimbursed ex-
penses from the international, but from any information I had, thev
would be, at the most, $10,000 or $11,000 a year.
The Chairman. That is what the international reported to you ?
Mr. Bansley. Well, for those particular ^^ears that I had occasion
to ask or it.
Mr. I^NNEDY. Now, you say that you kept the books of local 150.
Was Mr. Maloney receiving anything from local 150, which was under
trusteeship ?
Mr. Bansley. Well, you say anything — do you mean salary ?
Mr. Kennedy. Money or gifts from local 150 under trusteeship ?
Mr. Bansley. During this period ?
Mr. Kennedy. Yes.
Mr. Bansley. Yes. To my knowledge he received a gift of a tele-
vision set, and I believe it was in the year 1952, or it might have been
1953 or 1954, and I am talking from memory. It was about $350. I
think he received another gift from local 150 of an air-conditioning-
unit.
Mr. Kennedy. Who gave him that gift, or those gifts ?
Mr. Bansley. Well, I would presume it would be local 150.
Mr. Kennedy. Who, in local 150, decided he should have those
gifts?
Mr. Bansley. Well, Mr. Law, I believe, was the supervisor at that
time.
Mr. Kennedy. Mr. Law ?
Mr. Bansley. William J. Law, L-a-w.
Mr. Kennedy. And that local is under trusteeship ; is it ?
Mr. Bansley. Yes.
Mr. Kennedy. And who appoints Mr. Law ?
Mr. Bansley. Mr. Maloney. That is the routine, I would imagine.
He is the general president and he has right to appoint.
Mr. Kennedy. Mr. Law saw fit to use union money to buy Mr.
Maloney an air-conditiong set and a television set?
Mr. Bansley. That is right.
Mr. Kennedy. He wanted to give him a gift ?
Mr. Bansley. Yes, sir.
Mr. Kennedy. And he used union funds ?
Mr. Bansley. I would think that that is right, Mr. Kennedy.
The Chairman. Was any vote taken by the union members?
Mr. Bansley. That I wouldn't know. Senator.
The Chairman. They do not have any voice when the local is under
trusteeship ?
Mr. Bansley. That I don't know. I don't know how much voice
they have.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8227
The Chairman. You never heard of them having any voice in that
union ; have you ?
Mr. Bansley. Well, I have never really inquired. I have had no
occasion to inquire.
The Chairman. It appears on the face of it, unless there is some
explanation, that here is a union taken over in trusteeship in which
the international and the international president appoints somebody
as "supervisor*' or ''tiustee" or whatever term you want to apply.
That supervisor or trustee is responsible directly to the international
and by reason of that he is directly responsible to the international
president. He is not responsible or accountable to the membership
in the union ; is he ? You know that ; do you not ?
j\Ir. Bansley. You say he is not responsible to the membership in
the union ?
The Chairman. He is not accountable. A trustee or supervisor is
not accountable to the membership in the union.
Mr. Bansley. We publish a statement for the members every
year, and every year the members get a statement.
The Chairman. Is it as faulty as the income-tax return ?
Mr. Bansley. No, sir ; it is not faulty.
The Chairman. The income-tax returns appear to be.
Mr. Bansley. That is a matter of opinion, Senator.
The Chairman. Do they contain statements of fact? I am not
blaming you for that, but again I am pointing out how these trusteed
unions are operated, and they are operated to respond to the will and
for the benefit and usually the profit in many instances of the superior
officers in the international.
Mr. Bansley. May I say to you, Senator, that for the purpose of
the record, at the time Mr. Maloney left the local 150, the total as-
sets, that is the cash and so on, aggregated about $40,000.
As of June 30, 1957, the total assets of that union in cash and
securities was approximately $1.2 million.
Now, I don't know what that means from the standpoint of super-
vision, and I am not going to argue.
The Chairjman. That is splendid indeed, but he got paid about
$55,000 a year.
Mr. Bansley. Not from local 150. He got his salary from the
international.
The Chairman. He was getting it from the same union members,
whether it comes from the international treasury or from the local.
It came out of the workingmen's pockets.
Mr. Bansley. I will have to grant that.
The Chairman. We agree on that ?
Mr. Bansley. Yes, sir.
The Chairman. All right, proceed.
Mr. Kennedy. You say that you gave the union members a finan-
cial statement ; is that right ?
Mr. Bansley. Yes, sir.
Mr. Kennedy. Did you report, in the financial statement, that Mr.
Maloney had been given a gift of a television set?
Mr. Bansley. It wasn't probably set out that Mr. Maloney got a
gift of a television set, but it was probably included in the expenditures
of the union.
Mr. I^NNEDY. As a general matter, in the expenditures ?
8228 IMPROPER ACTIVITIES IN THE Ll\BOR FIE!LI>
Mr. Bansley. Yes, sir.
Mr. Kennedy. Nobody would know, then, that Mr. Maloney got
a television set ?
Mr. Bansley. Not from reading that statement ; no.
Mr. Ejennedy. Did they know that he got an air-conditioning out-
fit?
Mr. Bansley. No ; not from reading the statement.
Mr. Ivennedy. When you came across this item in your auditing
of the books, that this man was giving Mr. Maloney a television set
out of union funds, did you check to see whether that was approved
by the union ?
Mr. Bansley. All of those expenditures were approved by the
supervisors.
Mr. Kennedy. Just answer the question. Did you check and find
out whether giving Mr. Maloney a television set was approved by the
union ?
Mr. Bansley. I don't know what you mean by approved.
Mr. Kennedy. That is not a tough question.
Mr. Bansley. We probably looked at that check, and looked at
that bill, and saw that it was O. K.'d for payment.
Mr. Kennedy. O. K.'d by whom ?
Mr. Bansley. By Mr. Law, who I believe was the supervisor at
that time.
Mr. Kennedy. Is he the union then in your estimation ?
Mr. Bansley. No ; but he was the man that was responsible for the
union at that time.
Mr. Kennedy. Did you see whether it was approved by the mem-
bers of the union, who pay the dues ?
Mr. Bansley. Oh, no, I would not see that.
Mr. IvENNEDY. In other words, all it had to do was be approved by
the man who ran the union and that was sufficient for your audit ?
Mr. Bansley. I think so ; yes, sir.
Mr. IvENNEDY. That is the kind of audits that have been going on.
The membership never finds out what is going on, and they just know
so much money comes in and so much money goes out and it all adds
up correctly.
The Chairman. Are there any other questions ?
Senator Ervin. I have no questions, but, Mr. Chairman, it is right
interesting to look at sections 1, 2, and 3 of article 19 of the constitu-
tion of the International Union of Operating Engineers w^hich pro-
vides for defense fund, and provides that it shall be used to sustain
the union and its members in the case of lockouts and strikes.
It is further interesting to Imow that in disbui-sin*^ this fund to
prevent lockouts and strikes, the president can determine how much
is to be used and how long it is going to be used, and it can be author-
ized for such period of time as he specifies, with nobody to control
him, whicli is just another indication how under the constitution and
this operation that Mr. Maloney was about as near an absolute mon-
arch as North America has known.
The Chairman. I do not know whether this constitution has ever
been made an exhibit. Has it, Mr. Kennedy?
Mr. Kennedy. It has not.
The Chairman. Mr. Calabrese, I hand you a printed book, a small
book, and can you identify it ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8229
Mr. Calabrese. Yes, this is the constitution of the International
Union of Operatino; Engineers, which has been amended.
The Chairman. Do you have the original constitution and the
amendment thereto?
Mr. Calabrese. Yes, sir.
The Chairman. The two documents may be made exhibits 104, the
original being 104, and the amendments thereto, 104-A.
(The documents referred to were marked "Exhibits 104 and 104-A,"
for reference, and may be found in the files of the select committee.)
j\Ir. Kennedy. There is a section here dealing with auditors, re-
garding tlieir responsibilities and duties. I would like to have it
read into the record.
I think it indicates and shows that there is no real check when an
auditor makes a record or makes a study of the books of a local.
The Chairman. Let us have order, please. The chair will read from
exhibit 104-A which is the amendment to the constitution of the
International Union of Operating Engineers.
I read article 23, subdivision 2, section I, entitled "Auditor":
It shall be the duty of the auditors to audit the books and accounts of the
recording corresponding secretary, the financial secretary, the treasurer, and
any other officer or representative holding funds of the local union at the end
of the official quarter each year. And to report thereon at the first meeting
of the local union in the months of January, April, July and October.
The auditors shall have power to summon any officer or member to explain
the condition of his record or any discrepancy that may appear therein and any
officer so summoned shall be required to turn over to the auditors all papers,
records, books, and property belonging to the local union demanded by them.
They shall furnish the general president full and complete data on any subject
witliin their control or knowledge when requested.
Mr. Kennedy. Now, Mr. Chairman, we will continue with the activ-
ities of Mr. Maloney tomorrow, in local 150, but we had a matter
that came up yesterday regarding the activities of Mr. Peter Weber,
and some companies in which he had an interest. We have a witness
here on that.
The Chairman. We will interrupt testimony at this point. There
will be no further testimony this afternoon regarding Mr. Maloney, but
we will resume that phase of the inquiry tomorrow.
Mr. Kennedy. That is right.
The Chairman. ^Vho is the witness ?
Mr. Kennedy. Mr. Raymond S. Fisher.
The Chairman. Do you solemnly swear that the evidence you shall
give before this Senate Select Committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Fisher. I do.
TESTIMONY OF RAYMOND S. FISHER, ACCOMPANIED BY HIS
COUNSEL, LOUIS I. FISHER
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Fisher. Raymond S. Fisher, 202 Ava Avenue, Summerdale,
N. J., and I am a contractor.
The Chairman. Mr. Fisher, you have counsel present to represent
you?
Mr. Fisher. Yes, sir.
8230 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Will you identify yourself ?
Mr. Louis Fisher. Louis I. Fisher, F-i-s-h-e-r, member of the bar of
the State of Illinois, 100 East Erie Street, Chicago, 111.
Mr. Kennedy. Mr. Fisher, you were born in Chicago ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. December 19, 1916 ?
Mr. Fisher. December 9, 1916.
Mr. Kennedy. And you went to the University of Chicago ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And then you went to work for S. A. Healy Co?
Mr. Fisher. Approximately a year after I left the university, I had
several short-time jobs in the intervening year.
Mr. Kennedy. And from approximately 1939 through 1944, you
worked for Mr. Healy?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And then you went in the service ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And then in 1946 you went back to work for Mr.
Healy?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And you worked for him until 1950 ?
Mr. Fisher. Yes, sir.
Mr. Ivennedy. What sort of work were you doing for him at the
end ?
Mr. Fisher. My primary work was as cost accountant, and I was
also office manager, and assisted in estimating bids for construction
work.
Mr. Kennedy. In the course of the work you w^ere doing, did you
meet Mr. Peter Weber ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. At that time, was he an official of the local 825 ?
Mr. Fisher. I believe, sir, that at the time that I met him, in the
latter part of 1946, he was a member, I believe, of the international
organization and subsequently to my belief, in 1947, I knew him to
be an official of local 825.
Mr. Kennedy. He was a business agent for local 825 subsequently ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. Then in 1950, did you decide you would set up
business for yourself ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And at that time did you attempt to go into a busi-
ness which was unsuccessful? Not a major business venture, but you
made a slight inroad into going into business and it was unsuccessful ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And that was the construction business ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And then this was about 1950 ?
Mr. Fisher. That is right.
Mr. Kennedy. Then did you contact Mr. Peter Weber subse-
quently ?
You explain in your own words, what happened.
Mr. Fisher. At the time that the organization that I first formed
was no longer functional, I tried to form a new organization by
niPROPE'R ACTIVITIES IX THE LABOR FIELD 8231
ticquiriiig capital from many sources, eight in particular. I had
hoped to get eight with nominal investments.
Mr. Kennedy. Eight people?
Mr. Fisher. Yes, sir; one of whom was Mr. Weber wliom I con-
tacted through a friend and one who already had committed himself
to entering the business with me.
Mr. Kennedy. How much did he agree to put up at that time ?
Mr. FisiiER. $2,500.
]\Ir. Ivjennedy. Was he to receive some shares in the corporation ?
Mr. Fisher. During the first, perhaps, 3 or 4 months of the organi-
zation's existence, we had the use of his money Avithout my firm
knowledge as to whether it was for stock or a loan. At the end of
that 4-month period, when those who had contributed to the capital
of the organization got together, we decided that stock would be
issued for all of the contributions that had been made.
Mr. Kennedy. You gave him 25 shares of stock at that time?
Mr. Fisher. Yes, sir.
Mr. Kennedy. Did Mr. Peter Weber receive his stock at the same
time everyone else received theirs ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And there was not a question of the stock being dis-
tributed and then not being able to pay olf Mr. Peter Weber and give
him 25 shares instead ?
Mr. Fisher. All of the stock certificates, sir, were written at the
sa me time, and issued at the same time.
Mr. Kennedy. Did you Imow whether Mr. Peter Weber put the
money up in cash ?
Mr. Fisher. It was handed to me by another in cash and repre-
sented to be the money that Peter Weber contributed.
Mr. Kennedy. By whom was it handed to you ?
Mr. Fisher. By James A. Brown.
Mr. Kennedy. Wlio was also in the local ?
iNIr. Fisher. Who was working, not an official of the local but a
working member of the local.
Mr. Kennedy. That business has been phenomenally successful;
]ias it not?
Mr. Fisher. It has been extremely successful ; yes, sir.
Mr. Kennedy. Would you feel that the presence of Mr. Weber in
the company has helped and assisted the success of that company, in
all frankness?
Mr. Fisher. I definitely feel that it has helped in an intangible
manner. I feel that the Imowledge that he was a stockholder in the
company in some instances has benefited the company, but compared
to the overall success I would say that it was a very, very minor con-
tribution.
Mr. Kennedy. Do you feel that the contribution that he has made
is the result of his connection and contact with the union, as an
official of the union ?
Mr. Fisher. Not so much, sir, with his own union, because if any-
thing I feel that tlie connection with his own union has caused us to
operate in our connection with them in a most particular and proper
manner. But perhaps because of the Imowledge among other trades
with whom we do business that he has a share in the company, our
8232 IMPROPER ACTIVITIES IN THE LABOR FIELD
relationship with them may have been better than it otherwise would
have been.
Mr. Kennedy. As a matter of fact, you have not had any difficulty
or most of the work you have done has been in the area covered by
local 825 ?
Mr. Fisher. Approximately 70 percent.
Mr. Kennedy. And you have not had any difficulty with local 825 ?
Mr. Fisher. None; no material difficulty with 825.
Mr. Kennedy. And, when you did have problems, you felt free to
discuss them with Mr. Weber ?
Mr. Fisher. I have discussed them with him, but I have generally
worked them out with his subordinates, who, of course, were mindful
that he had an interest in the company.
Mr. Kennedy. These people that work on your contracts, the union
officials that work on the contracts, the business agents; they work
under his direction, do they not ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. Have you also gone into another piece of business
with Mr. Weber, the Public Contracting Corp. ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And that is the same stockholders as the P. C. I.,
the Public Construction, Inc.?
Mr, Fisher. The stockholders in Public Constructors, Inc., have
the same pro rata share, but no stock certificates have been issued for
Public Contracting Corp.
Mr. Kennedy. How long has that company been in existence?
Mr. Fisher. I believe it was formed in 1954, but I am not sure.
Mr. Kennedy. So, it has been in existence for 3 or 4 years, ap-
proximately ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And Mr. Weber has an interest in that company?
Mr. Fisher. The same percentage of interest that he has in the
other ; yes, sir.
Mr. Kennedy. And he is aware of the fact that he has had an in-
terest in that company ?
Mr. Fisher. I am sure that he is aware that we had formed what
we spoke of as an equipment company. I am really not sure that
he is even aware of the name of it.
Mr. Kennedy. But you have discussed this company with him,
have you not?
Mr. Fisher. I am sure that I have.
Mr. I^NNEDY. And that is a company that operates in the same
area?
Mr. Fisher. Yes, sir.
Mr. Kennedy. You also have formed another company, the Jersey
Equipment Co. ?
Mr. Fisher. The Jersey Equipment Co. was a partnership operat-
ing under that name prior to the time that I obtained an interest in it.
Mr. Kennedy. What does the Jersey Equipment Co. do?
Mr. Fisher. The Jersey Equipment Co. owns two truck cranes
that are rented to whoever has use for truck cranes, generally con-
tractors. Most generally, it is to Public Constructors.
Mr. Kennedy. Did you get Peter Weber interested in this com-
pany?
IMPROPER ACTIVITIBS IN THE LABOR FIELD 8233
Mr. Fisher. Yes, sir.
]\Ir. Kennedy. And could you tell the committee how the money
was, raised or put up for that company ?
Mr. Fisher. Yes, sir. In order to buy the half interest in Jersey
Equipment Co. that was available when one of the half owners ap-
proached me about buying out his partner, I was informed that $9,000
was needed to make the purchase. I had $3,000 from a relative avail-
able for a few months to invest any way that I found lit, and I con-
tributed $3,000, my wife and I, lending $1,500 to the relative, and
$1,500 to Peter Weber, and the other $3,000, making a total of $9,000,
was loaned to Peter Weber by Public Constructors, Inc.
]\Ir. Kennedy. So, Mr. Peter Weber did not put up any of his
money, and he borrowed the money from you and from the Public
Constructors ?
Mr. Fisher. That is right.
Mr. Kennedy. So, the $4,500 was put up by him; that was all
borrowed i
Mr. Fisher. Yes, sir.
Mr. Kennedy. Did he place his home up as collateral on that loan ?
Mr. Fisher. He offered to, but he did not.
Mr. Kennedy. At the time he received the money, he did not offer
to, did he ?
Mr. Fisher. I believe not. There may have been a 2- or 3-day
lapse.
Mr. Kennedy. And it was afterward, when a question came about
paying the money back, that he offered to put his home up ?
Air. Fisher. There was a necessity for closing the deal one day,
at whicli time I called and asked him for the money, and he said that
he would get it up, and when, a couple of days later, I called and
asked wliere it was, he said, "If you have to have it, I will put up
my house or borrow it or something," but he did neither.
(At this point, the following members were present: Senators Mc-
Clellan and Ervin.)
Mr. Kennedy. Pie never put his house up ?
Mr. Fisher. No, sir.
Mr, Kennedy. And it never became a serious matter of discussion,
did it ?
Mr. Fisher. No, sir.
Mr. Kennedy. And those cranes operate now ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And they have working for them, once again, these
Operating Engineers; is that right?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And they operate in the jurisdiction of local 825?
Mr. Fisher. Yes, sir.
Mr. Kennedy. Why did you ask Mr. Weber to come into this part-
nership ?
Mr. Fisher. I think the main reason in my mind was that I felt that
his participation in it would help assure keeping them working and
thereby make my relatives, my mother-in-law and father-in-law,
some money on the venture.
Mr. Kennedy. That his connection with the union would permit
or insure that these cranes continued to operate; is that correct?
8234 lAIPROPER ACTIVITIES IX THE LABOR FTEfLD
Mr. Fisher. It is so, sir, but I wouldn't like to imply that I had in
mind that he would impose them on anyone.
All construction work in the area that was performed with construc-
tion equipment was done with his knowledge or at least the knowledge
of the union, and I felt that he was aware of many situations where
they could have been used that I may not have been aware of.
Mr. Kenishedy. So you felt that not only his association with the
union as an official, but the knowledge that he would have as his official
of the union, could assist this company, is that right ?
Mr. Fisher. Yes, sir.
Mr. KJENNEDY. And finally Union Engine Service Co. is another
company in which you have been in business with Mr. Weber ?
Mr. Fisher. Yes, sir.
Mr. Kennedy. And your interest began in what way ? Can you ex-
plain that ?
Mr. Fisher. Yes, sir. I was approached by two employees of an-
other firm doing the type of business that was proposed for Union
Engine Service, namely repairing diesel engines and perhaps occasion-
ally gasoline ones, and some allied lines, and told that these two indi-
viduals were discontent with their present employment and felt that
they could take the business away from their present employer to the
benefit of another organization, and that they had contacted various
union members, 825 members, as would be their job in trying to acquire
work for their current employer, and that the union members had
indicated a willingness to contribute toward the organization of an-
other firm to do the same type of business.
At the same time they were accompanied by James Brown, who is
a stockholder in Public Constructors, and a friend of mine, and he
advised that if the organization was formed, they would like me to
supervise it, to head it.
Mr. Kennedy. So you agreed to do so ?
Mr. Fisher. I agi'eed to do so.
Mr. Kennedy. And this was going to be made up of a number of
business agents who were members of local 825 ?
Mr. Fisher. That is the way it developed.
Mr. Kennedy. Where did you have your first meeting of this com-
pany?
Mr. Fisher. The meeting that was held prior to the actual organiza-
tion of the company was held at the union hall of local 825.
Mr. Kennedy. The first meeting of this company. Union Engine
Service Co., wdiich was going to employ these operating engineers,
the first meeting of the company was held in the union hall of local
825. Is that right?
Mr. Fisher. I believe so, sir, yes.
Mr. Kennedy. Mr. Fisher, you have been cooperative in your dis-
cussions with the members of the staff. I just want to ask you one
question. Do you see that there is anything improper in having this
business relationship with an official of a labor union where you were
employing members of that labor union and were in competition with
other companies which had to rely on the good will of the labor union
official ?
Mr. Fisher. I can see, sir, that there is that possibility. But it
didn't exist, and I would have permitted it to exist. Our relationship
with the union was proper in all respects.
niPROPFJR ACTIVITIES IN THE LABOR FIELD 8235
Mr. Kennedy. It very Avell might have been. But do you see on the
surface, on the face of it, that there was a clear conflict of interest as
far as Mr. AVeber was concerned, and as far as you were concerned
liavinsf Mr. Weber in partnership with you, Mr. Jim Brown and
others ?
Mr. Fisher. May I speak to my counsel a minute, please ?
The Chairman. Surely.
(The witness conferred wdtli his counsel.)
Mr. Fisher. I can see, sir, that it might have been improper, but
had it ever got to be so, I would have taken whatever measures are
necessary to sever the relationship.
Mr. Kennedy. But on the face of it, without getting into what
was done wrong or right within the corporation or the companies in
which you were involved, on the face of it there is a clear conflict of
interest, is there not ?
Mr. Fisher. It looks like it, yes, sir.
The Chairman. Is there anything further?
If not, thank you very much, Mr. Fisher.
Mr. Kennedy. Thank you, Mr. Fisher.
The Chairman. Are there any other witnesses this afternoon?
Mr. Kennedy. We are all finished.
The Chairman. The committee will stand in recess until 10 : 30 in
the morning.
(Whereupon, with the following members present : Senators McClel-
lan and Ervin. the committee recessed at 4: 17 p. m., to reconvene at
10 : 30 a. m. Friday, January 31, 1958.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
FRIDAY, JANUARY 31, 1958
United States Senate,
Select Committee on Improper Activities
IN the Labor or JVL^nagement Field,
Washing/ton, D. G.
The select committee convened at 10 : 30 a. m., pursuant to Senate
Resolution 74, agreed to January 30, 1957, in room 457, Senate Office
Building, Senator Jolin L. McClellan (chairman of the select com-
mittee) presiding.
Members of the select committee present: Senators John L. Mc-
Clellan, Democrat, Arkansas; John F. Kennedy, Democrat, Massa-
chusetts; Barry Goldwater, Republican, Arizona; Karl E, Mundt,
Republican, South Dakota; Carl T. Curtis, Republican, Nebraska.
Also present : Robert F. Kennedy, chief counsel ; Jerome S. Adler-
man, assistant chief counsel; Alphonse F. Calabrese, investigator;
Jack S. Balaban, GAO investigator on loan to the select committee;
Pierre E. G. Salinger, investigator ; James Mundie, investigator ; Ruth
Watt, chief clerk.
The Chairman. The committee will come to order.
Call the next witness.
Mr. Kennedy. Mr. Chairman, one of the items that we mentioned
yesterday, of expenses by Mr. Maloney, was a miscellaneous item and
I thought that we would have Mr. Balaban testify for a minute or
two on what kind of items were purchased by the international for
Mr. William E. Maloney, the fixtures that we talked about and one
of those suitcases.
The Chairman. As I understand, these are items that were car-
ried as expenses on trips.
Mr. Ivennedy. Or just personal matters that were paid for by the
union.
The Chairman. Goods that were bought and had been charged to
the union, which were strictly personal.
TESTIMONY OF JACK S. BALABAN— Resumed
The Chairman. This is implementing your testimony of yesterday
where we had placed in the record the accounts and the moneys he
had received, or that the union had paid out for him as expenses.
Mr. Balaban. That is right, sir. These are personal items.
The Chairman. All right.
Mr. Balaban. One item was a diamond and platinum wristwatch
for $1,250.
21243— 58— pt. 20 21 8237
8238 EVIPROPER ACTIVITIES m THE LABOR FIELD
Another suitcase for $91.50.
An item of 8 hams for $107.35.
There were some shirts for $144.12.
A pair of shoes for $24.
An RCA television, $585.60.
Senator Curtis. May I interrupt right there? These items like
the television and the platinum wristwatch and diamond, does it show
■who got them ?
Mr. Balaban. Yes, sir.
Senator Curtis. Who did ?
Mr. Balabax. Mr. Maloney got them.
Senator Cuktis. For his personal use, or did he give them away?
Mr. Balaban. He got them for his personal use.
Senator Curtis. You do not know whether they were gifts for
anyone ?
Mr. Balaban. Not that we know of. The bills are out showing
that they were received by Mr. Maloney. We have the backups for
all of these items.
The Chairman. If they were given to someone else, Mr. Maloney,
of course, could give the explanation of it, but in the first instance
he procured them; he purchased them; he submitted the bill to the
union and the union paid for them.
Mr. Balaban. That is correct, sir.
The Chairman. Wliat he did with them afterward, we do not know.
Mr. Balaban. That is right, sir.
The Chairman. All right ; go ahead.
Mr. Balaban. Then we have some other items as to the annual dues
at racetracks.
Mr. Kennedy. We have been into that.
The Chairman. "V^Hiat did that total, annual dues to racetracks ?
Mr. Balaban. Total is $875. These are selected items, Senator.
They are not the totals. The totals were put in yesterday on those
big schedules which are already in as exhibits.
The Chairman. I understand. I did not remember whether the
record showed the total amount paid out for the racetrack.
Mr. BBalaban. We do have the figures for that schedule.
Mr. Kennedy. For the years' total it was approximately $875 for
the racetrack ?
Mr. Balaban. These are just selected items,
Mr. Kennedy. More than $875 ?
Mr. Balaban. That is right.
Mr. Kennedy. Then one other matter, the television conversion,
$125; is that right?
Mr. Balaban. That is right, sir.
Mr. Kennedy. You mentioned the RCA television, $585.60 and then
the television repairs, $125.
Mr. Balaban. That is in addition to the price of the television.
Mr. Kennedy. These were matters all paid for by the international
union for Mr. William E. Maloney ?
Mr. Balaban. That is right, sir.
The Chairman. As I understand, this list j^ou have read is just a
sample. It does not cover all of them ?
Mr. Balaban. That is right ; it is just a sample.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8239
The Chairman. Are there any further questions i
All right, thank you.
Mr. Kennedy. Now, Mr. Chairman, we get into the locals under
trusteeship out in Chicago.
We have here — Mr. Calabrese has the list of locals that were under
the trusteeship of the International Union of Operating Engineers.
It is nowhere near the number under trusteeship in the teamsters,
but the date when some of these locals were put under trusteeship are
of interest.
I will ask Mr. Calabrese if he will read that list.
The Chairman. All right.
TESTIMONY OF ALPHONSE CALABRESE— Resumed
Mr. Kennedy. How many kjcals of the Operating Engineers are
under trusteeship ?
Mr. Calabrese. At this time, 12.
Mr, Kennedy. Will you read the list of them and when they were
put under trusteeship ?
Mr. Calabrese, The first 11 are as of June 1, 1957.
Local union No. 94. New York, placed under supervision on
December 20, 1941.
Local union No. 98— —
Mr. Kennedy. The supervisor of that is Thomas E. Burke?
Mr. Calabrese. That is correct.
Local union 98, Springfield, Mass., was placed under supervision
on September 27, 1940.
Mr, Kennedy, Going back to local 94, that has 1.709 members?
Mr, Calabrese. That is correct.
Mr. Kennedy. Local 94 has 1,709 members, and local 98 is 1,851
members ?
Mr. Calabrese. Yes.
Mr, Kennedy. 1,851 members?
Mr. Calabrese. That is correct.
Senator Curtis. What was the the date of each of them ?
Mr. Calabrese. Local 94 was placed under supervision on Decem-
ber 20, 1941. Local 98 was placed under supervision September 27,
1940.
Local 136, in Port Washington, Long Island, in New York, was
placed under supervision, on August 4, 1938.
The members listed here are 300.
Local union No. 139 of Milwaukee, Wis.
Mr, Kennedy, The supervisor of that is Joseph J, Delaney; is
that right?
Mr, Calabrese, Yes,
Mr. Kennedy. He is the secretary-treasurer?
Mr. Calabrese. He is the present secretary-treasurer of the inter-
national union.
Mr, Kennedy, For local 136 Delaney is supervisor ?
Mr, Calabrese, That is correct.
Senator Curtis. Who is supervisor at Springfield, Mass.?
Mr. Calbrese. William Welsh, who is one of the international vice
presidents of the international union.
8240 IMPROPER ACTIVITIES IX THE LABOR FIELD
Mr. Kennedy. I hate to go back again, but I think it would be
helpful also if we put the assets of the locals in.
For instance, local 94, the assets are $31,415.96.
Mr. Calabrese. That is correct.
Mr. Kennedy. Assets of local 98 are $168,727.34; is that correct?
Mr. Calabrese. That is correct.
Mr. Kennedy. Local 136 is $204,714.83 ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Local 139, Milwaukee, supervisor is Mr. Marshall
Wlialing?
Mr. Calabrese. Placed under supervision, November 26, 1939;
membership, 3,057 ; the assets, $178,029.59.
Local 150, which was Mr. Maloney's local, is in Chicago, 111., and
was placed under supervision on May 7, 1929. It is now supervised
by Mr. James P. Crane.
There is a total membership of 6,638. The assets are listed as
$1,012,069.92.
Mr. Kennedy. That has been under trusteeship since its incep-
tion?
Mr. Calabrese. That is correct ; yes.
Local union No. 377, Great Falls, Mont., placed under supervision
on August 22, 1052. The supervisor is Joseph B. Dzivi; membership,
^92; assets, $66,761.62.
Local No. 399, Chicago, and these are the Stationary Engineers in
Chicago
Mr. Kennedy. They are engineers that work in the boiler room?
Mr. Calabrese. That is right. They handle the big boilers in the
large industrial plants, and so forth. This was placed under super-
vision on December 13, 1929. The present supervisor is Mr. Anton J.
Imhahn. He is also an international vice president.
The Chairman. What is the membership ?
Mr. Calabrese. 3,045 ; the assets are $452,872.12.
Local 410 of Binghamton, N. Y., was placed under supervision on
March 11, 1948. The present supervisor or the supervisor listed, is
Joseph H. Delaney, now the secretary-treasurer of the international
union.
Membership is 429 ; the assets, $33,246.50.
Local union No. 542, Philadelphia, Pa., placed under supervision
August 19, 1952. The supervisor listed is Hunter P. Wharton. The
assistant supervisor H. W. Lavery. Membership is 4,643. Assets
are $395,116.52.
Senator Curtis. How do those assets compare with the time they
took it over in 1952 ?
Mr. Calabrese. I am sorry ?
The Chairman. That is fewer assets than when they took it over
in 1952, is it not?
Mr. Calabrese. Senator, these assets are listed as of the date that
we got them; namely, 1957. I don't know what the assets were in
1952.
Senator Curtis. The previous witness, the president, during that
interim when they had control of their own union, from 1948 to 1952,
told of building up the assets to something around $700,000. That
included the welfare fund, of course. This is about half of what it was
when they took over, if the same factors are involved.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8241
Mr. Calabrese. Local Union 545, Syracuse, N. Y., placed under su-
pervision on January 23, 1941. The supervisor listed is Joseph J.
Delaney, and Howard Dalton, assistant supervisor.
The membership is 1,886. The assets are $336,285.16.
Local Union No. 832, Rochester. N. Y., placed under supervision
October 28, 1946, and supervisor listed is Joseph J. Delaney. The
total membership is 1,065 ; the assets, $147,911.47.
The Chairman. What is the number of that local ?
Mr. Calabrese. 832.
Now, this is the list that was provided to us by the International
Union of Operating Engineers as of June 1, 1957.
Now, since this list was prepared, another local union, namely, that
of union No. 3 in San Francisco, Calif., has been placed under trustee-
ship because of the troubles that came to light recently.
The Chairman. What is the membership of that union ?
Mr. Kennedy. About 24,000.
Mr. Calabrese. That is about it ; approximately 24,000.
The Chairman. 24,000 members. I believe that was the testimony.
It was placed under supervision this year ?
Mr. Calabrese. It was placed under supervision when Mr. Swanson
had the difficulty.
The Chairman. 1957?
Mr. Calabrese. 1957. The latter part of 1957.
The Chairman. What are the assets of that local union ?
Mr. Calabrese. I don't have the figures on that, Senator. I don't
have them readily.
Senator Curtis. My observation has been that when they are placed
under supervision of trusteeship their assets are dissipated. In every
case we have had in here they have little or no assets and if they get
their autonomy back they build them up again.
The Chairman. As I recall, the membership of the international is
about 270,000 ; is that correct ?
Mr. Calabrese. The most recent figure I reecived this morning from
the international and it is given to me as 283,434.
The Chairman. What is the total membership that is under trustee-
ship according to your figures ?
Mr. Calabrese. The 12 locals total 51,056, and that is the most
recent figure.
Mr. Kennedy. Does that include local 3 ?
Mr. Calabrese. Yes.
The Chairman. In other words, about one-fifth of the membership
is under trusteeship ?
Mr. Calabrese. Approximately, yes.
The Chairman. Although that is not one-fifth of the number of
locals, but one-fifth of the membership of the international today is
under trusteeship ?
Mr. Calabrese. Approximately, yes.
The Chairman. That means that those members, one-fifth of the
total membership of the international have no voice or vote whatso-
ever?
Mr. Calabrese. That is right.
Mr. Kjennedy. Mr. Chairman, under the rules of the international
those in the parent organization can vote in elections, therefore, those
in A, B,
8242 n [PROPER activities ix the labor riErLD
figures we have found that only 131,108 out of the 283,434 are allowed
to vote, which is ai^proximately 46 percent.
Tile Chaikman. Yes, but after you take off
Mr. Kennedy. No; that is including those who cannot vote and
;ta_king off those who are under trusteeship and cannot vote.
The Chairman. Less than half of them can vote.
Mr. IvENNEDY. That is correct, and in the Operating Engineers,
less than half of the members of the Operating Engineers can vote.
JNIr. Calabrese. That is for their local officers.
The Chairman. The way they vote for the international officers
is that the international officers or supervisor appoints the delegates
or whatever delegates are appointed to the national committee.
The local members do not select the delegates where they are mider
trusteeship, do not select delegates to the national convention.
iMr. Calabrese. That is correct.
_ The Chairman. So they are in effect appointed by the interna-
tional ?
Mr. Calabrese. That is correct, Senator.
The Chairman. So the voting strength of all these locals that are
in the trusteesliip is definitely controlled by the international unions
in the international election?
Mr. Calabrese. I would say that is a fair assumption.
Senator Curtis. Mr. Chairman, I would like to make an observa-
tion, I can understand the argument for the union checkoff of dues by
the employer to the union where it is genuinely a union chosen by the
employee and that he has a part in running it.
Certainly I cannot understand why the law would tolerate a check-
off for a union that for 10 or 15 years its own international will not
let run or have a voice in it.
I think that would probably tend to stop these racketeers in the
international unions from grabbing the assets, making pawns out of
the employer.
Mr. Kennedy. This figure does not include also the permit he must
-pay to the union.
Senator Curtis. In that connection may I ask a question about this
money ?
This relates to the Philadelphia local. They spoke of the 5 percent
of the man's pay had to go back in the union and some of the workers
referred to as a kickback, how was that collected? Was it collected
through checkoff or otherwise ?
Mr. Calabrese. I do not know. Senator.
The Chairman. Mr. Calabrese, you have made a compilation of
these figures about which you have just testified regarding the locals,
the number of the local, the date it was placed under supervision, the
supervisor, the number of members, and the amount of assets.
This list was prepared under your super^dsion ?
Mr. Calabrese. Yes, sir.
The Chairman. Is that the basis of your testimony ?
Mr. Calabrese. It is.
The Chairman. That may be made exhibit 105.
(The document referred to was marked "Exhibit No. 105" for
reference and may be found in the files of the select committee.)
Mr. Kennedy. Mr. Chairman, that is the breakdown of the A, B,
C, D, and E category.
IMPROPER ACTIVrriES IN THE LABOR FIELD 8243
The Chairman. Mr, Calabrese, have you examined this breakdown
in the A, B, C, D, and E category of these unions under trusteeship?
Mr. Calabrese. I did.
The Chairman. That may be made exhibit No. 106.
(The document referred to "was marked "Exhibit No. 106,'' for
reference and may be found in tlie hies of the select connuittee.)
Mr. Kennedy. Now, IVIr. Chairman, we have gone already into the
local under trusteeship in Philadelphia. Now we are going into the
locals under trusteeship in Chicago.
And regarding their operation and their use of funds, I would like
to call an investigator to the stand to testify regarding some of the
uses of the funds of local 150, which has been under trusteeship now
for some 29 years, where the membership has riot been allowed to vote
for 29 years.
TESTIMONY OF JAMES MUNDIE— Resumed
The Chairman. Mr. Mundie, you have been previously sworn.
Mr. Mundie. I have.
Mr. Kennedy. Now, local 150 was put imder trusteeship in 1929;
is that correct?
Mr. Mundie. That is correct.
Mr. Kennedy. And Mr. William E. Maloney was the supervisor of
that local up until the time he became international president?
Mr. Mundie. That is correct.
Mr. Kennedy. And then Mr. Crane succeeded him ?
Mr. MuNDLE. Mf . Law succeeded him,
Mr. Kennedy. And then Mr. Crane succeeded him in 1954 ?
Mr. Mundie. That is correct.
Mr. Kennedy. Do you have a breakdown and review of their rec-
ords of some of the items which have been purchased for Mr. William
E. Maloney and some of the services performed for Mr. Maloney out
of 150?
Mr. Mundie. I have, sir.
Mr. Kennedy. Now, Mr. Maloney, as international president, is sup-
posed to receive all of his pay, salary, and compensation from the in-
ternational ; is that not correct ?
Mr. Mundie. That is my understanding.
Mr. Kennedy. And any services he performs for local 150 are a
part of the services he performs for the international ?
Mr. MuNDEE. Yes, sir.
Mr. Kennedy. He should not receive pay or compensation from
both the local and from the international ?
Mr. Mundie. That is my understanding.
The Chairman. He receives a salary and compensation as interna-
tional president, and that obligates him to perform the services for any
local, for any such services as he performs ?
Mr. Mundie. That is correct.
Mr. Kennedy. Would you tell us whether Mr. Maloney has in fact
received items and services from local 150 despite the fact that he has
been international president ?
Mr. Mundie, Yes; I have here before me photostat copies of the
purchases of automobiles that were made for Mr. Maloney by 150.
8244 EVIPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Would you give us the situation as far as that is con-
cerned ?
Mr. MuNDiE, I have here before me a photostat copy of an invoice
dated June 10, 1950, from the W. A. Mack Co. in Chicago, IlL, for a
Cadillac automobile purchased and sold to William E. Maloney in the
amount of $4,590.40.
The Chairman. What is the date of it ?
Mr. MuNDiE. June 10, 1950.
Mr. Kennedy. Who was that paid by ?
Mr. MuNDiE. Local 150.
Mr. Kennedy. Do you have supporting documents showing it wa&
paid by local 150?
Mr. Mundie. I have, sir.
The Chairman. That invoice and the supporting documents may
be made exhibit 107.
(Documents referred to were marked "Exhibit No. 107"' for refer-
ence and may be found in the files of the select committee. )
Mr. Mundie. I have a photostat copy of a letter dated May 26, 1952,.
from William E. Maloney, addressed to Mr. William J. Law, super-
visor.
Mr. Kennedy. Just summarize the letter.
What he did then was to say that the local owed him $2,000 ?
Mr. Mundie. For travel expenses, with no substantiation.
Mr. Kennedy. And he was going to keep the Cadillac purchased in
1950?
Mr. Mundie. That is correct.
Mr. Kennedy. In lieu of the expenses ? »
Mr. Mundie. That is correct.
The Chairman. That may be made a part of exhibit 107 as further
explanation of the transaction. It will be made a part of exhibit 107»
Mr, KJENNEDY. In December of 1953, did Mr. Maloney sell that
Cadillac?
Mr. Mundie. Yes. In 1953, Mr. Maloney sold this Cadillac to Mr.
Newell J. Carman. I have a photostat check of Mr. Carman's, No.
935, dated some time in December of 1953, in the amount of $2,000.
Mr. ICennedy. And N. J. Carman is the present vice president of
the Operating Engineers ?
Mr. Mundie. That is correct.
Mr. I^nnedy. Wliat happened was that the local bought a Cadillac
for the use of William E. Maloney in 1950.
Mr. Mundie. That is correct.
Mr. I^NNEDY. In 1952, Maloney wrote to the local and said that
they owed him $2,000 for travel, which he did not substantiate at
all, and he said he was going to keep the Cadillac instead.
Mr. Mundie. That is correct.
Mr. Kennedy. The next year he sold the Cadilac for $2,000 to the
present vice president of the International Union of Operating Engi-
neers, Mr. Carman.
The Chairman. That document may also be made a part of exhibit
107.
Mr. Kennedy. What did Mr. Malone do with the check ?
Mr. Mundie. It was deposited in local 150's bank account.
Mr. Kennedy. For what purpose?
Mr. Mundie. For the purchase of a 1952 Cadillac.
IMPROPE'R ACTIVirrES IN THE LABOR FIELD 8245
Mr. IvENNEDY. So he received is 1952 Cadillac from the local union
for the $2,000?
Mr. MuNDiE. That is correct.
Mr. MuNDiE. I have an invoice here.
The Chairman. Was it a new Cadillac ?
Mr. MuNDiE. Yes, sir.
The Chairman. And what did the union pay for it?
Mr. MuNDiE. Local 150 paid $5,400.
The Chairman. And Mr. Maloney paid only $2,000 for the original
Cadillac.
Mr. MuNDiE. The $2,000 that Mr. Maloney received was deposited
in the local 150 bank account.
The Chairman. And he got a new Cadillac instead ?
Mr. MuNDiE. Yes, sir.
Mr. Kennedy. By 1953 he had received a brandnew 1952 Cadillac
for nothing ?
Mr. MuNDiE. That is correct.
The Chairman. Was the title issued in his name ?
Mr. MuNDiE. Well, that I do not know, but I have the bill of sale
in his name.
The Chairman. I would regard it as such, then. If the bill of sale
is in his name, that would be true.
Mr. MuNDiE. That is right.
The Chairman. Mr. Maloney's name.
Mr. MuNDiE. That is correct.
The Chairman. Actually, he has not invested anything at all,
not one dime in this new car.
Mr. MuNDiE. No, sir.
The Chairman. All right. The document supporting this second
car may be made exhibit 108.
(Document referred to was marked "Exhibit No. 108" for reference
and may be found in the files of the select committee.)
Mr. Kennedy. What did he do with the Cadillac ?
Mr. MuNDE. That Cadillac was sold to Newell J. Carman for $2,000,
in November of 1954.
Mr. Kennedy. What did he do with that money ?
Mr. Mundie. That $2,000 was deposited in his personal checking
account at the First National Bank of Cliicago, 111. That was on
December 6, 1954.
Mr. Kennedy. So now he ends up with the $2,000 as well.
Mr. Mundie. That is correct.
Mr. Kennedy. And he does not have a car by this time ?
Mr. Mundie. Yes, he has a car.
Mr. Kennedy. He gets another car?
Mr. Mundie. Yes, sir.
The Chairman. That document, the last one that you have there,
may be attached to exhibit 108 as a part of that exhibit.
Mr. Mundie. I have a photostat copy of an invoice from W. A.
Mack Co., dated February 25, 1954, stating they sold, to William E.
Maloney, a 1954 Cadillac, "in the amount of $5,800.17.
Mr. Kennedy. That car is still in the possession of Mr. William E.
Maloney^
8246 IMPROPER ACTIVITIES IX THE Ll\BOR FIELD
The Chairman. Who paid for it ?
Mr. MuNDiE. Local 1.50.
The Chairman. You have supporting documents for that ?
Mr. MuNDiE. Yes, sir ; I have the check.
The Chairman. All documents the witness presents in support of
the purchase of the car on February 25, 1954, will be made exhibit 109.
(Documents referred to were marked "Exhibit 109" for reference
and may be found in the files of the select committee.)
Mr. Kennedy. Wlio pays for the storage and the gasoline and oil
for that car ?
Mr. MuNDiE. Local 150.
Mr. I^NNEDT. All expenses are paid for by local 150 ?
Mr. MuNDiE. For both cars.
Mr. Kennedy, He has another car ?
Mr. MuNDiE. Yes, sir.
Mr. ICennedy. Also purchased by local 150 ?
Mr. Mtjndie. Purchased by local 150, on December 2, 1955, for a
1956 Cadillac. I have a photostat copy of an invoice, sold to Mr.
William E. Maloney in the amount of $6,557.11.
The Chairman. That is a fourth car now ?
Mr. MuNDiE. Yes, sir.
The Chairman. All documents pertaining to the fourth car will
be made exhibit 110.
(Documents referred to were marked "Exhibit 110" for reference,
and may be found in the files of the select committee.)
The Chairman. Let me ask now, he now Avinds up with two cars ?
Mr. MuNDiE. He has two cars, a 1954 and a 1956,
The Chairman. Wliat about the title of the 1956 car, do you have
a bill of sale on that ?
Mr. MuNDiE, Yes, sir, I have a title of a 1956 car dated November
13, 1955, However, on the back of that title, which is maintained in
150, it is signed in blank by William E, Maloney.
The Chairman. He has the car ?
Mr. MuNDiE. He has the car, yes.
The Chairman. That is a part of exhibit 110.
Mr, Kennedy, So he has two cars purchased by 150 ?
Mr, MuNDiE, Yes, sir,
Mr. Kennedy. And those cars are also used by Mrs, Maloney ?
Mr. Mtjndie, That is right,
Mr, Kennedy, And when they are used for Mrs. Maloney, the gas
and storage also is paid for by the union ?
Mr, Mtjndie, That is correct.
Mr, Kennedy, And she signs ?
Mr, MuNDiE, She has a gas ticket, a credit card.
Mr. Kennedy. Wliatever gas expenses she has, are also paid l\v
local 150?
Mr, Mtjndie. That is correct,
IMr, Kennedy, What about Mr. Maloney when he comes to Wash-
ington ; is he without a car ?
^Ir. ]\IrNDTE. No : he has two cars in Washington.
Senator Curtis. These cars outside of Washington, both the cars
and the expenses are paid out of this local ?
Mr, Mundie. That is correct.
IMPROPER ACTIViTIES IX THE LABOR FILLD 8247
Senator Curtis. What is the number of that local ?
Mr. Ml XDIE. 150.
Senator (\'rtis. That has been under trusteeship since 1929 ?
Mr. McNDiE. Yes, sir.
Mr. Kennedy. What does he do Avhen he comes to Washington ?
Mr. MuNDiE. He has a 1952 Cadillac, and a 1958 Chiysler.
Mr. Kennedy. The 1952 Cadillac is a car bought by the interna-
tional union?
Mr. MuNDiE. I have a photostat copy of a check dated March 31,
1952, No. B-6643, payable to the Capitol Cadillac-Oldsmobile Co., in
the amount of $5,013.65. I also have an invoice or a voucher from
the international bearing the same number as the check, and it says
1952 Cadillac.
Mr. Kennedy. Where is that automobile kept ?
Mr. MuNDiE. Here in Washington.
Mr. Kennedy. And is that kept at the apartment ?
Mr. Mundie. That is kept at the apartment.
Mr, Kennedy. Kept at Mr. William E. Maloney's private apart-
ment I
Mr. Mundie. That is correct, and it — —
Mr. Kennedy. And the bills are paid by the international?
Mr. ]MuNDiE. Yes, sir.
]\rr. Kennedy. And the garage charges for this car are also paid by
the international ?
Mr. Mundie. I examined the bills coming from the apartment, and
they had garage, teleplione, and maid sei'vice.
The Chairman. All paid by the international ?
Mr. Mundie. All paid by the international; yes.
The Chairman. In whose name is this 1952 Cadillac liere in Wash-
ington ?
Mr. Mundie. I have a receipt here from the Capitol Cadillac Co.,
dated March 31, 1952, Xo. 8361. and it says, "Eeceived of WiUiam E.
Maloney."
The Chairman. What was received ?
Mr. Mundie. The $5,013.65.
The Chairman. Did Mr. Maloney pay for it?
Mr. Mundie. The international paid for it.
The Chairman. The international paid for it?
^Ir. Mundie. Yes, sir.
The Chairman. To whom is thfe title issued ?
Mr. Mundie. Well, I don't have the title, sir.
Mr. Kennedy. Mr. Calabrese has it.
Mr. Calabrese. It is in Mr. Maloney's name. I have checked with
the international union, and they have verified that.
The Chairman. They have verified that title of this car is in Mr.
Maloney's name.
Mr. Kennedy. You sav he also purchased a Chrvsler Imperial,
1958, is that right?
The Chairman. Those pertaining to the 1952 car, those documents
may be made exhibit 111.
(Documents referred to were marked "Exhibit 111," for reference,
and will be found in the appendix on pp. 8320-8321.)
S248 IMPROPER ACTIVITIES LS' THE LuVBOR ¥1EL,D
Senator Mundt. I have here photostat copy of an international
check No. 7138 in the amount of $6,418, payable to DeCozen East
Orange Co., and the voucher says, "For 1958 Imperial Crown four-
door sedan, less discount."
The Chairman. Where is that title ?
Mr. MuNDiE. The title is in the International Union of Operating
Engineers.
The Chairman. That one is in the international union ?
Mr. MuNDiE. Yes, sir.
Mr. Kennedy. From whom was that car purchased by the interna-
tional union?
Mr. MuNDiE. From Mr. Fay.
Mr. Kennedy. Mr. Joseph Fay ?
Mr. Mundie. That is correct, on December 26, 1957.
The Chairman. It was purchased from Mr. Fay ?
Mr. Mundie. Yes, sir.
The Chairman. He has become a car salesman ?
Mr. Kennedy. A car solicitor.
The Chairman. That is my error. Proceed.
Mr. Kennedy. So he has three Cadillacs, and an Imperial, is that
right?
Mr. Mundie. That is right.
Senator Curtis. Are there any chauffeurs ?
Mr. Mundie. Yes, he has a chauffeur here at the international.
The Chairman. Those records referring to the 1958 car will be made
exhibit 112.
(Documents referred to were marked "Exhibit 112," for reference,
and will be found in the appendix on pp. 8322-8323.)
Mr. Kennedy. The important matter so far as the local is concerned
is that these automobiles that you gave us first were paid for by the
local union, which was under trusteeship at the time ?
Mr. Mundie. That is correct.
Mr. Kennedy. And paid for by the local for Mr. William E.
Maloney ?
Mr. Mundie. That is correct.
Mr. Kennedy. He is the one that appointed tlie supervisor for the
local ?
Mr. Mundie. That is correct.
Mr. Kennedy. Do you have any other purchases out of local 150
for Mr. William E. Maloney ?
Mr. Mundie. I do. I have a photostat copy of an invoice from
Rabin's Supply & Furniture Co., 126 Selby Street, Hammond, Ind.
It says, "One JPhilco 34-ton air conditioner for Mr. Maloney, $386.''
The Chairman. That may be made exhibit 113.
(Document referred to was marked "Exhibit 113," for reference
and will be found in the appendix on pp. 8324-8325.)
Mr. Kennedy. That was paid for by the local ?
Mr. Mundie. By 150 ; yes.
I have another invoice from the same company dated January 15,
1954, for 1 RCA Victor television, in the amount of $289.45. I also
have the photostat copy of the check.
The Chairman. AVliat is that for ?
Mr. Mundie. For a television set.
IIMPROPPR ACTIVITIES IN THE LABOR FIELD 8249
The Chairman. That may be made exhibit 114, those documents.
(Documents referred to were marked ''Exhibit 114'- for reference
and will be found in the Appendix on pp. 8326-8327.)
Mr. Kennedy. Where was that television sent ?
Mr. MuNDiE. To Mr. Maloney's residence.
Mr. Kennedy. Out in Arlington Heights ; is that right ?
Mr. MuNDiE. Yes, sir.
The Chairman. Proceed ; do you have something else ?
Mr. Mundie. That is all I have.
Mr. Kennedy. Then I believe that he received $2,000 in convention
expenses in 1952, and $500 in 195G ?
Mr. Mundie. That is correct.
Mr. Kennedy. From the local for which convention he was also
reimbursed by the international ?
Mr. Mundie. Yes, sir; the convention was at Chicago, 111., in Uie
respective years.
Mr. Kennedy. That is all.
Tlie Chairman. Thank you very much.
Call the next witness.
The committee will stand in recess for 5 minutes.
(Thereupon, a brief recess was taken.)
The Chairman. The committee wdll come to order.
TESTIMONY OF PIERRE E. G. SALINGER— Resumed
The Chairman. Have you been sworn in this proceeding ?
Mr. Salinger. I have, sir.
Mr. Kennedy. Mr. Salinger, we have been interested in the situa-
tion regarding local 150 out in Chicago, 111.
Mr. Salinger. Yes, sir.
Mr. I^nnedy. And as it relates to William E. Maloney.
Mr. Salinger. Yes, sir.
Mr. Kennedy. Mr. William E. Maloney came into the labor union
movement in Chicago, did he not?
Mr, Salinger. Correct, sir.
Mr. Kennedy. And he had some difficulty in the late 1920's, and
in 1929 he got control of local 150, did he not ?
Mr. Salinger. He was the first supervisor of local 150.
Mr. Kennedy. He was made supervisor and head of the local when
there were no members ?
Mr. Salinger. That is correct.
Mr. Kennedy. The local was formed especially by the international,
and he was given control as a supervisor ?
Mr. Salinger. Yes, sir.
Mr. Kennedy. We have traced with the assistance of Mr. George
Hartman, of the Chicago Tribune, the activities of Mr. William E,
Maloney during the 1930's.
Mr. Salinger. Yes, sir.
Mr. IvENNEDY. And the situation then, and who his contacts were
during this period of time.
Mr. Salingi:r. Yes, sir.
Mr. KJENNEDY. With whom he worked and on whom he relied.
Mr. Salinger. Yes, sir.
8250 IMPROPER ACTIVITIF:S in the labor FIEI.D
Mr. Kexxedy. Up until the 1940's. through the early part of the
1940's.
Mr. Salinger. Yes, sir.
Mr. Kennedy. Have you prepared a memorandum, based on the
activities of Mr. William E. Maloney from the information from Mr,
Hartman, from other sources of information, including Govei-nment
agencies ?
Mr. Salinger. That is correct, sir.
Mr. Kennedy. You have prepared that memorandum for submis-
sion to the committee members ?
Mr. Salinger. I have, sir.
Senator Curtis. Mr. Salinger, I have had a glance at this docu-
ment. It recites not only a history of William E. Maloney, but it
makes reference to his actions in certain situations. Is it correct to
state that this is based upon accounts that have heretofore been
published ?
Mr. Salinger. A majoriy of them have been published. Some of
them have not. Senator.
Senator Curtis. Then you have added to that your own verifica-
tion by interviews with reporter for the newspaper that has pub-
lished these ?
Mr. Salinger. He turned over to me his original notes that he took
at the time that he conducted his own survey back in the 1940's.
Senator Curtis. You have examined those notes ?
Mr. Salinger. I have them here ; yes, sir.
Senator Curtis. You have sought such verification and corrobora-
tion as you could from other sources to ascertain the accuracy ?
Mr. Salinger. Correct ; Government agencies and other sources.
Senator Curtis. What Government agencies? I will withdraw the
question.
The Chairman. You have referred to Government agencies to get
some corroborating evidence ?
Mr. Salinger. I have received reports from Government agencies.
The Chairman. You have there some photostatic copies of docu-
ments corroborating some of the parts of your report.
Mr. Salinger. That is correct, sir.
The Chairman. Now, in filing this staff memorandum, you have
undertaken to verify to your satisfaction there are reasonable grounds
for believing these things to be facts?
Mr. Salinger. I have, sir.
Tlie Chairman. The Chair feels this waj about this docmnent:
We have undertaken to have Mr. Maloney present. At least tem-
porarily, he is unable to attend these hearings. I would not want
to do him any injustice. We do expect to have him come before this
committee as early as his health will permit.
Therefore, I am going to permit this document that you testify to,
a compilation of your investigation and the information you have, to
be made an exliibit for reference. Along with the other testimony
here, the facts that have been established under oath by witnesses
who have appeared before the conunittee, and the record made in
these public hearings, it will serve as a bill of particulars for Mr.
Maloney to know, and for his international imion and its members to-
know, and foi- the AFT>-CIO and its ethical practices committee to
IMPROPER ACTIVITIES IN THE LABOR FIELD 8251
know just what the facts are with respect to Mr. William E. Maloney,
president of the International Union of Operating Engineers.
It will also serve as a staff report of this committee until we can
get Mr. Maloney here, at least, to interrogate him about it.
The facts and the charges set forth in this memorandum will also
serve as information to the Congress from this committee with re-
spect to legislation, because there are things in this report that cer-
tainly need legislative attention.
Now, we want to have Mr. Maloney here as soon as it is possible
for him to attend, and to interrogate him, specifically with reference
to each one of these actions that are reported by the staff.
I think it is fair to him, insofar as we can, to let him know what
information we have, and also to let others who are interested, and
who should be interested, know what information this committee has
and the evidence it is seeking to confirm or deny these facts as now
related to us.
So this w^ill be made exhibit No. 115.
(Document referred to was marked "Exhibit No. 115" for refer-
ence, and may be found in the files of the select committee.)
The Chairman. I am not going to have it read at this time. It
becomes a part of this record for reference, but I wanted to get it
officially before this committee, so that any who are interested in it
may refer to it. Mr. Maloney may have the benefit of the informa-
tion, he and his counsel, as to what this committee has uncovered
with respect to his past activities, how this union has been operated,
and the abuses that have been perpetrated upon these union members.
Do you have anything to add to that, Mr. Curtis?
Senator Curtis. No, Mr. Chairman.
The Chairman. Is there any thing further ?
Mr. Kennedy. No.
The Chairman. All right ; you may stand aside.
Mr. Kennedy. The memorandum refers specifically to the activity
of Mr. Maloney with respect to local 150. I would like to call two
members of local 150, Mr. Clarence Donath and Mr. Charles Press,
The testimony, to some extent, will go into matters covered by the
memorandum.
The Chairman. Come around, gentlemen.
Do you and each of you solemnly swear the evidence you shall give
before the Senate select committee shall be the truth, the whole
truth, and nothing but the truth,, so help you God ?
Mr. DoNATH. I do.
Mr. Press. I do.
TESTIMONY OF CLARENCE DONATH AND CHARLES W. PRESS
The Chairman. Be seated.
On my left the witness will state his name, place, residence, and
business or occupation.
Mr. DoNATii. My name is Clarence Donath. I live at 16ii5 North
Nagle Avenue, Chicago, 111. I am a hoisting engineer.
The Chairman. You are an operating engineer ?
Mr. DoNATH. That is right.
The Chairman. Member of local 150 ?
Mr. DoNATH. Yes, sir.
8252 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. The next gentleman ?
Mr. Press. My name is Charles W. Press, and I live at 6921 Co-
lumbia, Hammond, Ind., also member of Operating Engineers, 21
years.
The Chairman. Member of local 150 ?
Mr. Press. Yes, sir.
The Chairman. You waive counsel ?
Mr. DoNATH. We do.
Mr. Press. We do.
The Chairman. Thank you very much.
Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Donath, you have been with the Operating En-
gineers for how long ?
Mr. DoNATH. Since 1923, Mr. Kennedy.
Mr. Kennedy. What was the first local you were in ?
Mr. Donath. 569.
Mr. Kennedy. Is that the local Mr. William E. Maloney was also
with ?
Mr. Donath. Yes, sir.
Mr, Kennedy. During the 1920's, according to the information we
have, the local 569 of the Operating Engineers were having a juris-
dictional fight with local 69 ; is that right ?
Mr. Donath. With local 69 ?
Mr. Kennedy. Yes.
Mr. Donath. No. I heard when I went into the organization that
69 was broken up and 569 was the result of that.
Mr. Kennedy. 569 replaced 69 ?
Mr. Donath. That is right.
Mr. Kennedy. What was 569 prior to that ? What was the number ?
Mr. Donath. I don't know.
Mr. Kennedy. What was the local's number when you originally
went in 'i
Mr. Donath. 569.
Mr. Kennedy. Was local 69 in existence at that time ?
Mr. Donath. No, sir.
Mr, Kennedy. Local 69 had become part of local 569 ?
Mr. Donath. That is right.
Mr. Kennedy. That is before j^ou got into the local ?
Mr, Donath. Kight.
Mr. Kennedy. Was Mr. Maloney a business agent of local 569 ?
Mr, Donath. Not when I first went in,
Mr, Kennedy, Was he subsequently ?
Mr. Donath. He was elected about a year or two after I became
a member of 569,
Mr, Kennedy. Was there a plan underway during the 1920's to
amalgamate local 569 with local 42 of the Brotherhood of Chauffeurs?
Mr. Donath. That was in 1929.
Mr. Kennedy. And the international executive board had ordered
the amalgamation ?
Mv. Donath. The international president, sir.
Mr. Kennedy. Had most of the members of your local 569 opposed
the ama]<z:amatioD ?
Mr. DoxATir. Yes. sir.
IMPROPE'R ACTIVITIES IN THE LABOR FIELD 8253
Mr. Kennedy. Was that opposition led by a man by the name of
Dennis Ziegler ^
Mr. DoNATii. That is right.
Mr. Kennedy. And also Edward F. Moore ?
Mr. DoNATH. Right.
Mr. Kennedy. Maloney was in favor of the amalgamation?
Mr. DoNATH. Yes, sir.
Mr. Kennedy. In May of 1929 Maloney w^as leading the step toward
amalgamation, did the members of the union vote as to wdiether they
wanted to heave Maloney out of the local ?
Mr. Donath. Yes ; they did. He came into the local one night with
an ultimatum from Mr. O'Neil who was then general president
The Chairman. Will you speak louder ?
Mr. DoNATH. Mr. Maloney came into the local meeting in 1929
with an ultimatum from the then general president, Mr. Haddell, that
we amalgamate with local 42. The membership voted that they did
not want to go over, so we stayed out and fought.
Mr. Kennedy. Did they vote then on William E. Maloney?
Mr. Donath. Yes, sir; they did. They voted to throw him out of
the meeting and expel him from the union.
Mr. Kennedy. Was that a pretty close vote as to whether to oust
him ?
Mr. DoNATH. About 400 to 1.
Mr. Kennedy. Leaving Maloney voting for himself and the 400
voting against him ?
Mr. Donath. That is right,
Mr. IvENNEDY. That was in 1929 ?
Mr. DoNATH. Right.
Mr. Kennedy. Then did he go to the international and get a char-
ter for local 150?
Mr. DoNATH. I believe he had the charter at the time, Mr. Kennedy.
Mr. Kennedy. Anyway, local 150 was immediately set up with Wil-
liam E. Maloney running it ; is that right ?
Mr. DoNATH. That is right.
Mr. Kennedy. And you received instructions for all local 569 mem-
bers to go into local 150 under William E. Maloney ?
Mr. DoNATH. That is right.
Mr. Kennedy. Did you try to get an injunction against that ?
Mr. DoNATH. Yes, sir ; we did.
Mr. Kennedy. That was subsequently withdrawn ?
Mr. DoNATH. That is right, sir.
Mr. Kennedy. Now, was it also stipulated that if you did not trans-
fer immediately from 569 to William E. Maloney's local, local 150,
that you would lose death benefits you had been paying ?
Mr. DoNATH. That I don't know anything about.
Mr. Kennedy. Was it learned subsequently that you could not
transfer your death benefits unless you transferred immediately ?
Mr. DoNATH. Well, I only know about my case, Mr. Kennedy. I
didn't go into local 150 until February of 1935.
Mr. Kennedy. Did you get your death benefits at that time ?
Mr. DoNATH. No ; I had to start fresh.
Mr. Kennedy. So you lost the payments you had made ?
Mr. Donath. I lost the previous years.
21243— 58— pt. 20 22
8254 IMPROPER ACTIVITIES IX THE LABOR FIEI.D
The (Chairman. How lono- had you been making payments ?
Mr. DoNATH. From approximately 1924 to 1929.
The Chairman. You had been making payments 5 j^ears for death
benefits and you lost that ?
Mr. DoNATH. Right.
Mr. Kennedy. Ziegler was leading the opposition to William E.
Maloney in local 150 ?
Mr. DoNATii. Right.
Mr. Kennedy. You were trying to continue your old local as it
remained and the local that had ousted "William E. Maloney?
Mr. DoNATH. That is right.
Mr. Kennedy. Did you make a request to the international to keep
569 going?
Mr. DoNATH. We tried every way we could to keep it going, sir.
The Chairman. About how many members did it have at that
time?
Mr. DoNATH. Wlien we finally broke up ?
The Chairman. Yes.
Mr. Donath. I would say there were approximately five or six
hundred members in there.
The Chairman. Some five or six hundred members at the time the
struggle was going on ?
Mr. DoNATH. Right.
Mr. Kennedy. Did you hear during the early 1930's of the forma-
tion of an organization called TAT ?
Mr. DoNATH. There were a lot of rumors flying around Chicago at
that time.
Mr. Kennedy. That was the trucking and transportation associ-
ation ?
Mr. DoNATH. Right.
Mr. Kennedy. In 1930 or 1933, was Maloney and about a dozen
well-known gangsters in Chicago indicted for their operations in
TAT?
Mr. DoNATH. That is right.
Mr. Kennedy. That is the Trucking and Transporting Associa-
tion ?
Mr. DoNATH. Right.
Mr. Kennedy. That was in December 1933; is that right?
Mr. Donath. Somewhere around there.
Mr. Kennedy. Ziegler, as you say, was leading the opposition;
subsequently Ziegler was murdered, was he not ?
Mr. Donath. He was.
Mr. Kennedy. Will ;vou tell us what happened there ?
Mr. Donath. Mr. Ziegler left the office at the end of his day's
work and went home on the streetcar and bus. He got off on the
corner of the street he lived on at Addison and Keeler, I believe it
was, and he started to walk down the street and this man came up
behind him and shot him in the head and then jumped into a car and
got away.
Mr. Kennedy. This was during his opposition to William E. Ma-
loney ?
Mr. Donath. That is right, sir.
Mr. Kennedy. Do you know whether there was a document or
memorandum in his possession ?
IMPROPER ACTRITIE.8 IN THE LABOR FIET.D 8255
Mr. DoNATH. No ; I do not.
Mr. Kennedy. Mr. Chairman, this won't be authentic, firsthand
information, but we have a copy of the document that I believe Mr.
Ziegler had in his possession or that was avaihible during that period
of time.
Is that right, Mr. Salinger ?
Mr. Salinger. He had documents about the interview with the per-
son that had knowledge about the documents.
Mr. I^NNEDY. Do we have a copy of what was supposed to be said
in the document in his possession ?
Mr. Salinger. Yes, sir.
Mr. Kennedy. Can we put that in ?
The Chairman. Let me see it.
Mr, Kennedy. Mr. Salinger, prior to the time Ziegler had been
murdered he had been writing letters to William Green.
Mr. Salinger. He had.
Mr. Ivennedy. He had written a number of letters to William
Green ?
Mr. Salinger. He had.
Mr. Kennedy. Can we put a nmnber of those letters, or excerpts
from William Green in the record ?
The Chairman. You can verify those ?
Mr. Salinger. We have copies of the letters. These were typed
from copies at the time and made available to the people I got them
from.
The Chairman. All right, do you want to make them an exhibit ?
They may be made exhibit 116.
(The document referred to was marked "Exhibit No. 116" for ref-
erence and may be found in the files of the select committee.)
Mr. Kennedy. I think this describes the situation then and the
situation we will describe even up to the present time and this is some
20 years later.
Mr. Salinger. The first letter was written to Mr. Green on Janu-
ary 9, 1933, by Mr. Ziegler. He stated in part :
I am taking the liberty of writing you in the interest of a very large number
of engineers, hoisting, portable, and stationary, located in various cities and
towns in the United States.
These men were for many years a large majority and still are members of the
International Union of Operating Engineers. Because of the many abuses
existing within the International Union of Operating Engineers for several
years past and still being practiced by the oflBcers of the International Union
of Operating Engineers the rank and file of our organization has completely
lost confidence in the integrity and ability of the oflBcers of the international.
Many of the ofiicers have so muscled their way into many of the local unions
riiat the members feel it is impossible ever again to have the international
union again function as it should in the interest of the members and in ac-
cordance with the principles of the AFL.
He goes on to say :
The membership of the organization is sick and tired and disgusted with
being classified as being dominated and controlled by the worst form of rack-
eteers, hoodlums, and murderers in America. We want and demand freedom
from this stigma.
He closes the lettei- saying :
In conclusion I desire to make this clear to you. Brother Green, this is not a
hasty ill-advised action by a handful of either disgraced or disgruntled members,
but on the contrai-y among our men are to bo found the very best mechanics,
8256 IMPROPER ACTIVITIES IN THE LABOR FIELD
and oldtime members are in the vast majority. We have a keen sense of respon-
sibility. We fully realize that if we are to have a good, clean, honest, and
efficient organization, it is up to the membership to make it so. I do not hesitate
to say to you that if we are granted the charter we ask in less than 6 months
time from date of issue we will show you a larger membership than now exists
in the corrupt International Union of Operating Engineers. And in one year we
will exceed any previous record for membership.
Fraternally yours,
Dennis B. Ziegler.
The Chairman. Ziegler was writing to William Green, president
oftheAFL?
Mr. DoNATH. That is right, sir.
Now, he got an answer from Mr. Green which said in part :
I would strongly advise against the action which you are planning to take.
It will serve no good purpose. If you have complaints against the administra-
tion of the officers of the existing organization of Operating Engineers, surely
there is a way by which your complaint can be considered and adjusted. No
good purpose can be served by splitting the organization of Operating Engi-
neers, dividing it into hostile camps fighting each other instead of fighting to-
gether. I repeat again, I strongly urge you to desist from taking action which
you state you and those associated with you are planning to take.
Very sincerely yours,
William E. Green.
The Chairman. How long was that before Ziegler was killed?
Mr. DoNATH. Ziegler was killed in February 1933.
These letters were written in January 1933.
Mr. Chairman. Just about a month?
Mr. DoNATH. Yes, sir.
Senator Curtis. Is it not true that at the time that Green Avrote
that letter that Ziegler and his associates had already sought relief
in court \
Mr. DoNATH. They had, sir. In fact, they had obtained one in-
junction and contempt action against Mr. Maloney and the other
officers for attempting to coerce the members of local 569 becoming
local 150.
Mr. Kennedy. They used democratic means, but were beaten.
Mr. DoNATH. That is right. He wrote another letter to Mr. Green
on January 18, 1933:
In your letter you say "There is surely a way by which our complaints
can be considered and adjusted." Do you have in mind any method by which
this can be done, or any tribunals to which we may go? We are not permitted
to assemble in convention.
I might interpose there was not an international convention of
Operating Engineers from 1928 to 1940, 12 years.
The Chairman. Not an international convention for 12 years?
]\rr. Donath. For 12 years.
Tlie Chairman. All right.
Mr. DoNATH (reading) :
Whole local unions are voted by supervisors appointed by the president of
the international. Other local unions are bodily disenfranchised. The votes of
other local unions are flagrantly miscounted so that we may be denied the
privilege of assembling in convention and correcting the ills from which the
organization suffers.
In the absence of a convention the only remaining tribunal is the officers them-
selves \vh )m we charge with misconduct. Are they to be permitted to pass upon
the proi)riety of their own acts? Are they to be the judges of their own steward-
ship? What chance do we have to have our complaints considered and adjusted?
IMPROPEK ACTlVITIEiS IN THE LABOR FIELD 8257
The letter goes on in that vein.
The Chairman. Those letters may be marked "Exhibit 116."
Do you have personal knowledge of the effort Mr. Ziegler was
making on behalf of the membership at that time?
Mr. DoNATH. Yes; I do. I know he was making a very strong
effort to straighten the affairs out down in Chicago.
The Chairman. He was the leader trying to hold together the
\mion, 569, to keep it from being amalgamated with 150 ?
■Mr. DoxATH. That is right, sir.
The Cpiairman. 150 was just simply a charter that had been issued
toMaloney?
Mr. DoNATH. That is right.
The Chairman. After he had been kicked out, or about the time
he was kicked out by a vote of the members of local 569 ?
Mr. DoNATH. That is right.
The Chairman. They were undertaking to force all the members to
go into local 150?
Mr. DoNATH. That is right.
The Chairman. Ziegler was leading the fight to try to preserve
5G9 and not be forced to join the one-man union?
Mr. DoNATH. That is right, sir.
The Chairman. I assume it was a one-man union. He is the one
that got the charter and the only man that voted for it ?
Mr. DoNATH. That is the way it was.
Senator Curtis. Wlio issued the charter ?
Mr. DoNATH. Arthur Hudclell, president of the international.
Senator Curtis. Is he still alive ?
Mr. Donath. He was murdered.
Mr. Kennedy. Mr. Salinger, was there a document that was alleged
to have been found in Mr. Ziegler's possession at the time ?
Mr. Salinger. I have not seen the document.
Mr. Kennedy. What was alleged ?
Mr. Salinger. The document was alleged to have contained a
report of a threat to Mr. Ziegler by Mr. Maloney and his next in com-
mand, Mr. Jolmny Lynch, and it was supposed to have taken place,
the memo was dated February 23, 1932.
Mr. Kennedy. \Vliich was what, and how did that relate to the
day he was killed ?
Mr. Salinger. It was a year and a day before he was killed. He
said to escape these two gentlemen that he jumped into a taxicab and
at that time 1 of the 2 were supposed to have said to him, "You,
something, I will get you."
Now subsequently, the taxidriver who took Mr. Ziegler away from
these two gentlemen, was found, and verified what Mr. Ziegler had
said, and he did not realize that he had Mr. Ziegler in the cab until
he was taken down to the State's attorney's office in Illinois, after
Mr. Ziegler had been murdered, and then he related the incident
to them.
Mr. Kennedy. Wliat did he say that was said to Ziegler at that
time?
Mr. Salinger. He said exactly what Ziegler said, "You son of a ,
I will get you yet."
Mr. Kennedy. What was the conversation ?
8258 UMPROPER ACTIVITIES IX THE Lu\BOR FIEILD
Mr. Salinger. The cab drivei- turned around to Ziegler, and said,
"Are tliose guys fooling ''i " And he quoted Ziegler as saying, "Fooling,
hell, those guys are really out to get me."
The Chairman. Now, Mr. Maloney ^Yas present, and was 1 of the
2 men when Ziegler got in the cab ?
Mr. Salinger. He identified the two men who threatened him, one
was Mr. Maloney.
The Chairman. Mr. Maloney can answer. In other words, he can
state it is true or contend that these statements are false.
Mr. Salinger. That is correct, sir.
The Chairman. I wanted this in the record so that Mr. Maloney will
be prepared to answer these questions when he comes before the com-
mittee.
Is there anything further?
Mr. Kennedy. You mentioned about Mr. Huddell being killed.
Mr. Salinger. Yes, sir.
Mr. Kennedy. Would you just relate what happened as far as
that is concerned. What was the date of this ?
Mr. Salinger. On May 20, 1930, Mr. Huddell and Mr. Frank
Landon, the editor of the International Union of Operating Engi-
neers newspaper, and Mr. Possehl a vice president were in a Washing
ton D. C. restaurant when a gunman entered and fired a number of
bullets. He got Mr. Huddell near the heart, and he died 10 days later
from pneumonia. Mr. Landon was shot in the ear, and Mr. Possehl
was missed completely.
That would be approximately a year after Mr. Maloney was given
that local.
Senator Curtis. Was anyone prosecuted for tliat murder '?
Mr. Salinger. No, sir.
Senator Curtis. Was anyone ever arrested for it ?
Mr. Salinger. No, sir.
Mr. Kennedy. Going on, after Mr. Ziegler was killed, subsequently
you did go into local 150, did you?
Mr. DoNATH. In 1935.
Mr. Kennedy. Did you or any member of your family have any
personal difficulty during this period of time? Were you threatened
or your family was threatened?
Mr. DoNATH. My father was slugged on the Daily News iob when
the Daily News Building was built. He was beaten up at that time,
when that job was going on. He was working fo)- W. J. Newman,
when they were sinking the wells for the building.
Two men came into the engine room that they had there for a big
electric air compressor, and called him a lot of names, and said he was
fighting Maloney, and they beat him up, and they said they were
going to get me too. This happened on a Monday morning about 1
or 2 o'clock in the morning.
So my father came home from work, about 8 : 30 or 9 o'clock, and he
was pretty well beaten up. So I asked him what happened, and he
told me. t asked him, I said, "Do you know who did it ?"
And he said it was the Davis brothers. I left my house, and I had
a date with Eddie Morgan in the Sherman Hotel at 10 o'clock and on
the way downitown I stopped off at the union office which was then
in the Plumber's Hall at Washington and Aida Street. So I walked
EVIPROPE'R ACTIVITIES IX THE LABOR FIELD 8259
into the office, and 1 said to tlie secretary, "Who are these Davis
brothers that think they are so tough?" I said, "You tell them they
had better be careful or they are going to get hurt, too."
So one man was standing there, and he was about 6 feet tall, and
he said, "Who are you ?" I told him, "I am young Doughnuts." That
is a nickname they call me. He said, "Well, I will take you to him,
and so I said, "O. K., let us go." And so we went downstairs, and I give
him a pretty good trimming, and I gave him what he gave my father.
Senator Curtis. Do you know what his name was ?
Mr. DoNATH. Plis name was Davis, and I don't know what his first
name was.
Mr. Kexnedy. They did not bother you after that (
Mr. DoxATii. They never bothered me since then.
Mr. Kexxedy. We liave mentioned here about the TAT indictment
and Maloney being- indicted with some dozen others in connection with
that. AAHiat do the records show happened to Mr. Maloney ?
Mr. Salixger. He was acquitted.
Mr. Kexxedy. Did he stay in Chicago ?
Mr. Saltxger. First lie went to Miami to see how tilings wei-e going
to go.
Mr. Kexxedy. Who did he go with to Miami ?
Mr. Salixger. With Mr. Johnny Lynch.
Mr. Kexxedy. ^"\Tio was his assistant ?
Mr. Salixger. That is correct.
Mr. Kexxedy. Wliat subsequently happened to Mr. Lynch ?
Mr. Salixger. He was acquitted also on the same charge. However,
while Mr. Maloney and Mr. Lynch were in Miami, the members of
local 150 voted to oust both of them from office, and to call a. new
election, and they notified the general president of the Operating
Engineers Union by letter in January of 1934 that tliey were going to
take this action.
The Chairmax. What action ?
Mr. Salixger. Kicking Maloney and Lynch out.
The Chairman. Thatislocall50?
Mr. Salixger. The members.
The Chairman. Go ahead.
Mr. Salinger. To this they got a rather curt telegram from the
president, Possehl, saying they could not do anything of the kind.
Mr. Kennedy. Did they vote on J^icking him out ?
Mr. Salinger. A vote of 268 to 1, as I recall, or 268 to nothing.
Mr. Kennedy. By the membership.
The Chairman. That was this new local now ?
Mr. Salinger. Yes, sir.
The Chairman. They did not want him either ?
Mr. Salinger. That is right.
Mr. Kexxedy. Do you have the telegram that was sent back to
the local ?
Mr. Salinger. This is a copy of the telegram sent to the local by
John Possehl, on January 16, 1934. It says in part
The Chairman. It may be made exhibit No. 117.
(Document referred to was marked "Exhibit No. 117," for refer-
ence and may be found in the files of the select committee.)
8260 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Salinger (reading) :
Recent actions of membership in their regular meeting of January 1934, con-
doned by appointed oflacers and representatives are all without authority and
bespeak and attempt to foster rebellion and cessation without cause. You are
hereby ordered and directed to immediately recognize the authority of William
E. Maloney as supervisor for and in behalf of the general president, and file
with him copy of all activities in record form of the monthly meeting of January
1934.
It goes on and it ends with this little admonition :
Govern yourselves accordingly. Signed, John Possehl.
The Chairman. That was the president of the international at that
time, denying the right of the two-hundred-and-some-odd members of
local 150 to have any voice in the operation of their local, and denying
them the right to reject and to get rid of Maloney, who had been
appointed or who had been given this charter ?
Mr. Salinger. And he was at that time under indictment for
extortion.
Mr. Kennedy. Now, you have been fighting for independence dur-
ing this whole period of time ?
Mr. DoNATH. Yes, sir.
Mr. Kennedy. And subsequently you joined local 150 in 1935, and
since that time you have been trying to get independence for the
local?
Mr. DoNATH. That is right, sir.
Mr. Kennedy. Despite that, and despite the fact that the local
has been under trusteeship since 1929, despite the fact the local has
been chartered since 1929, you never have been allowed to vote for
your officers?
Mr. DoNATH. That is right, sir.
Mr. Kennedy. Now, have you tried to get the officers to give you
independent autonomy, and have you brought that up at meetings?
Mr. DoNATH. Yes, I did, in March of 1956. I presented a motion on
the floor, under the good of the order, that the officers of local 150
I)etition the international president, William E. Maloney, to release
ocal 150 of international supervision.
"Wlien I first presented the motion, the Chair said he would not
entertain it. Then later he relented, and I told him that he must
entertain the motion, and he relented, and allowed the motion to go
to the question, and a vote. We had a voice vote on the question. The
motion was carried.
The Chairman. That is as late as 1956 ?
Mr. DoNATH. That is right, sir.
The Chairman. Your motion was what ?
Mr. DoNATH. That the officers of local 150 petition the international
president, William E. Maloney, to release local 150 of international
supervision, and give us local autonomy.
The Chairman. Those officers were officers that had been appointed
by Maloney?
Mr. Donath. That is right.
The Chairman. And your position carried from the rank and file
members at that meeting, directing those officers to petition the inter-
national president, Maloney, to release your local from supervision ?
Mr. Donath. That is correct.
mPROPER ACTIVITIES IN THE LABOR FIELD 8261
The ('hairman. xVnd let it go back to its own autonomy ?
Mr. DoNATH. That is right.
The Chairman. And that motion carried?
Mr. DoNATH. It did.
The CiLviRMAX. By what kind of a vote ?
Mr. DoNATH. Well, it carried, Senator.
The Chairman. Was it a standing vote ?
Mr. DoNATH. A voice vote.
The Chairman. Did the presiding officer acknowledge that the mo-
tion was carried ?
Mr. DoNATH. He did.
The Chairman. Was it evident that it had carried?
Mr. DoNATH. It surely was. He would not have gone along with
it if it did not.
The Chairman. So you cannot say how many voted for it or how-
many against it ?
Mr. Donath. Not numerically, no.
Mr. Kennedy. But there was such a voice vote that even the pre-
siding officer recognized that the motion carried ?
Mr. DoNATH. That is right.
Mr. Kennedy. What became of it after that, and what happened?
Mr. Donath. I have not heard anything further from it.
Mr. IvENNEDY, You iiever heard from that since.
Mr. DoNATH. No, sir.
Mr. IvENNEDY. Do you know whether they actually petitioned Ma-
loney or not ?
Mr. DoNATH. I believe he did, and I am not sure.
The Chairman. You do not know ?
Mr. DoNATH. I asked if he sent the letter in to Maloney, and he
said he did.
The Chairman. He told you that he did ?
Mr. Donath. That is right.
The Chairman. Those on the staff who investigated that matter,
did they find any record of that action by the members at that meet-
ing, any record in the minutes showing that this motion was made
and passed ?
Mr. Calabrese. We have the minutes of the meeting which verified
what Mr. Donath stated.
The Chairman. The minutes of that meeting may be made exhibit
118.
(Documents referred to were marked "Exhibit No. 118," for refer-
ence and may be found in the files of the select committee.)
Mr. Calabrese. As a result of that letter which was sent to the
president over the signature of Mr. Crane, the supervisor, and the
secretary-treasurer, Joseph Collins, stating that the undersigned con-
stituting the officers of 150 pursuant to a motion passed at a monthly
meeting of local 150 held in Chicago, 111., on March 22, 1956, hereby
petition the general president of the Union of Operating Engineers
to release local 150 from international supervision, a copy of the
minutes of which meeting is hereto appended.
The Chairman. This letter may be made a part of exhibit 118 to-
gether with the minutes of meeting at that time.
8262 IMPROPER ACTIVITIES IN THE LABOR FIEI/D
Do you Unci any record of the action that the international president
took on that petition ?
Mr, Calabrese. There was no acknowledgement of this letter, Sena-
tor, until another meeting in April of 1956, at which time one of the
business representatives, James T. Mulligan, gave a lengthy talk in
regard to the supervision of local 150 and it was in a laudatory vein.
Subsequently, under the good of the order. Member Ed Gayney
made a motion that the officers of local 150 and the officers of lUOE
be given a rising vote of confidence. This motion was seconded by
Bill Murphy, and the motion was carried by overwhelming vote. It
was the consensus of opinion that the entire body agreed with the
explanation given— that is, Mr. Mulligan's explanation — why local 150
came under the supervision of the international union, and wanted
supervision.
The Chairman. Were you at that meeting ?
Mr. DoNATH. I was, sir.
The Chairman. Those minutes may be made exhibit 119.
(Documents referred to were marked "Exhibit Xo. 119" for ref-
erence, and may be found in the files of the select committee.)
The Chairman. ^"^Iiat occurred at that meeting?
Mr. DoNATH. Well, everything that Mr. Calabrese has stated.
Mr. Kennedy. Wliy did they reverse themselves ?
Mr. DoNATH. Mr. Kennedy, it has been a practice in our organiza-
tion that, any time that they wanted any kind of legislation passed on
the floor, they would notify the various master mechanics to get their
men in. Now, I have been informed from time to time by members in
the organization when the meeting was rigged to keep my mouth shut,
that I would be beaten at particular meetings, and I would do that.
So, I know that these men were loaded in there for the purpose of
beating me down, if I got up on the floor with any kind of suggestions.
The Chairman. You were present and, because of fear and threats,
you were afraid to protest the action they were taking ?
Mr. DoNATH. Not so much fear or any intimidation. Senator. I
was notified in advance that, if I brought anything up on the floor
that night, I would be beaten by the members. I don't mean phys-
ically beaten, I mean I would be beaten in a vote. They had the
meeting rigged up.
The Chairman. They had the meeting rigged, so that they knew
they could out vote you ?
Mr. DoNATH. That is right.
Mr. Calabrese. As a result of the April 26 meeting, Mr. Crane then
wrote another letter to the j^resident, Maloney, dated May 7, 1956,
and it makes reference to his letter of March 27, 1956, and then states
what happened at the April 26, 1956, meeting, and I will quote :
A motion was made and seconded to give a risina; vote of confidence to the
olBcers of local 1.^0, and the officers of the International Union of Operating En-
gineers, and to Iveep local 150 under supervision of the international. The vote
was 4.W to approximately 8 or 12.
Now, the very next day, by letter dated May 8, 1956, Mr. Maloney
wrote Mr. Crane and acknowledged the March 27 letter which asked
for release of local 150, and the May 8 letter. In it he states :
I wish to say that I believe the members of local l.W have made a wise choice
in not wanting to be released from supervision. This local union is one of the
lAIPROPKH ACTIMTIKS IX THE LABOR FIELD 8263
most progressive in the country, and it li.-is probably done more for its mpmbers
than any other local in the United States.
Then he goes on to say :
It was a very wise move when the members of local 150 put their confidence
in the officers of the local and decided to remain under supervision, and I think
it will work out to the best interests of the membership.
The (/HAiRMAX. Those two letters may be made exhibits 120 and
120A.
(Documents referred to were marked "Exhibits Nos. 120 and 120A"
for reference, and may be found in the files of the select conmiittee.)
Mr. Calabrese, He continues :
Of course, there will always be some members who will want to change the pro-
cedure for their own special benefit. If you will look at the record of 150, you
will find that there has been a great deal of progress made in the years that it
has been under supervision, and everybody seems to be satisfied, except a few
disgruntled members who wouldn't be satisfied under any circumstances.
I want to congratulate your local 150 on its wonderful success.
The record speaks for itself.
With kindest regards, 1 am.
Fraternally yours,
William E. Maloney,
General President.
Mr. Kennedy. Was it explained to you at this meeting by the offi-
cers that this was a business proposition ?
Mr. Donath. What do you mean by that ?
Mr. Kennedy. That this local union was a business operation, and
was there anything said about that ^
Mr. Donath. Well, I don't recall.
Mr. Kennedy. You do not remember any discussion about that ?
Mr. Donath. No, sir : I don't.
Mr. Kennedy. This is from a letter from Mr. Crane to Mr. Maloney,
where he says :
Due to the ever-increasing expansion of heavy industry in the Chicago area,
in my opinion it is important that local 150 have continuity of personnel in the
administration of its officers. The present officers of the local, by their expe-
rience, know the contractors and their requirements. They know the operators
who are experienced in operating the different types of equipment upon which
our operating engineers, boilers, and firemen work.
The administration of local 150 has been successful and its officers very hon-
estly administered its affairs. The same is true of the local's health and welfare
fund.
No one has accused us of inefficiency or dishonesty, and nobody can.
To subject this large local to periodic changes in management of its affairs
by election of officers would not help the membership. It would bust it.
The operation of this local union is not small business to be taken care of
after working hours. It is big business.
That is the way it was looked upon by your local officials.
The Chairman. That letter is a part of the files, Mr. Calabrese?
Mr. Calabrese. Yes, sir. This is a letter wliicli was received from
local 150 ; that is correct.
The Chairman. It was received from 150. It mav be made exhibit
121.
(Document referred to was marked "Exhibit No. 121" for reference,
and nuiy be found in the files of the select committee.)
Mr. Kennedy. He spoke about the good and fine relationship that
existed between the contractors and the union officials. Does Mr.
W. A. Healy operate much in the Chicago area ?
8264 IMPROPER ACTIVITIES m THE Lu\BOR FIEI^D
Mr. DoNATH, He does ; yes, sir.
Mr. Kennedy. And the local 150 has contracts with the W. A. Healy
Co.?
Mr. DoNATH. That is the S. A. Healy Co.
Mr. Kennedy. They do?
Mr. Donath. Yes, sir ; they do.
Mr. Kennedy. Could you tell us anything about the operations of
the S. A. Healy Co., as far as the union conditions are concerned?
Mr. DoNATH. They have always been a favored contractor, sir.
Mr. Kennedy. A favored contractor ?
Mr. Donath. Yes, sir.
Mr. Kennedy. What do you mean by "a favored contractor" ?
Mr. DoNATH. Well, at one time they had a contract on the sanitary
sewer job, and this contract run over the prevailing wage rate for the
year, into another year. So Mr. Lynch was chairman at that time,
and he prevailed upon the men that worked for Mr. Healy to stay
there and finish out the contract.
I have a statement from one of the men that worked on the job that
when they worked overtime they didn't get the overtime scale of
wages. They were paid the straight-time wages for overtime.
Mr. Kennedy. Was it generally understood among the members
of local 150 that S. A. Healy got preferred treatment ?
Mr. Donath. Yes, sir.
Mr. Kennedy. And that the union conditions were not enforced
for the S. A. Healy Co.?
Mr. DoNATH. That is right.
Mr. Kennedy. As far as local 150 was concerned, the Operating-
Engineers, the working conditions or union regulations were not
enforced where the S. A. Healy Co. was concerned ?
Mr. DoNATH. As far as the working agreement was concerned.
Mr. Kennedy. The contract was not enforced?
Mr. DoNATH. That is right.
The Chairman. You say the men did not get overtime on that job ?
Mr. DoNATH. I know of one case, sir
Mr. Kennedy. I just have a few question of Mr. Press.
You have been in the local for how long?
Mr. Press. 21 years.
Mr. Kennedy. You have been up in Indiana ?
Mr. Press. Yes, sir.
Mr. Kennedy. And have you had difficulty also up in Indiana ?
Mr. Press. Yes, we do.
Mr. Kennedy. Have you tried to get your own local autonomy ?
Mr. Press. Yes, sir.
Mr. Kennedy. It has not been successful ?
Mr. Press. No. We went so far as going to the State legislature
and getting a bill passed.
Mr. Kennedy. You got a bill passed to give you your own local
autonomy ?
Mr. Press. Yes, sir.
Mr. Kennedy. You got that passed in the State Senate in Indiana ?
Mr. Press. Yes, sir.
Mr. Kennedy. And has the international done anything about that ?
Mr. Press. No.
IMPRiOPE'R ACTIVITIES IN THE LABOR FIELD 8265
Mr. Kennedy. Were you reprimanded for getting the bill passed ?
Mr. Press. Well, in different ways. I was never threatened, but in
different ways they pick on members of our group; that is, trying to
straighten the local up, and have a vote and have a local that is really
worth something.
Mr. Kennedy. They discriminate against you as far as jobs are
concerned ?
Mr. Press. I used to be master mechanic on almost all jobs. "V^Hien
we got the bill passed, they gave me a 2 weeks' job, or maybe a month's
job, and now I am fortunate enough that they sent me on a 2 weeks-
job, and it is going to turn out as a permanent job, and they are very
sorry that they ever gave it to me.
Mr, Kennedy. Otherwise they were discriminating against you as
far as jobs were concerned ?
Mr. Press. Yes, sir.
Mr. Kennedy. Have you spoken up at the membership meetings
trying to get your own local autonomy ?
Mr. Press. A lot, yes, sir.
Mr. Kennedy. Without success ?
Mr. Press. Yes, sir,
Mr. Kennedy. Have you asked them for a membership list ?
Mr. Press, Yes, sir.
Mr. Kennedy. So you could contact the members ?
Mr. Press, Yes, sir,
Mr, Kennedy, What have they told you ?
Mr. Press. They said, "That is our own private business and it is
none of your business." We have asked them how many men we have
in Indiana, and they say about GOO, but we know there are more than
that.
Mr. Kennedy. They W'Ould not even tell you how many members
there are in the locals in your area ?
Mr, Press. They give us a rough estimate of 600,
Mr, Kennedy, But he would not show you the books or the records ?
Mr. Press. No.
Mr. Kennedy, You are not allowed to see those ?
Mr, Press, I was in the hall recently, and asked him to look at the
out-of-work list, and I wanted to know just what boys were out of
work, and Mr, Oliver and Mr. Carver, on our side at one time, they
took him into Chicago and brainwashed him, and now he is the busi-
ness agent and he has turned against us. His name is Lloyd Carver.
Mr. Kennedy. The leadership will not cooperate with you at all?
Mr. Press. That is right.
Mr. Kennedy. Have "you ever worked on any jobs that the S, A.
Healy Co. has had an interest in ?
Mr. Press. I think that they were connected with the Marr's job in
Gary, Ind.
Mr. Kennedy. Did you work on that job ?
Mr. Press, Yes, sir,
Mr, Kennedy, Did they receive preferred treatment up there?
Mr, Press, Pardon me,
Mr, Kennedy, Did that company receive preferred treatment on
that job?
8266 IMPROPER ACTRITIES IK THE L.\BOR PIEILD
Air. Press. I couldn't say that they did. I tried to straighten the
job up, as a steward, and I was promised a master mechanic's job, but
[ was fired because they said I didn't know how to operate the crane.
Mr. Kennedy. A^^iat were you trying to do, Mr. Press?
Mr. Press. Well, they had different pieces of equipment running
and there wasn't men on the job and 1 made them put men on the
equipment.
Mr. Kennedy. In other woi'ds, they were not meeting the contract,
is that not right ?
Mr. Press. That is right.
Mr. Kennedy. They were not living up to the contract ?
Mr. Press. Yes, sir.
Mr. Kennedy. And you tried to get men put on there so tliat they
would have to abide by the contract ?
Mr, Press. Yes, sir.
Mr, Kennedy. And subsequently you were fired from your job?
Mr, Press. Yes, sir.
Mr. Kennedy. And the reason they gave you was that you did not
know how to operate the crane, right ?
Mr, Press. Yes, sir.
Mr. Kennedy. How long had you been operating a crane ?
Mr. Press. I have been operating a crane since I was about 20 years
old.
Mr. Kennedy, And had you had any complaints about that crane
operation ?
Mr. Press. Never.
Mr. Kennedy. So when you started to have the contract enforced on
this job in which the Healy Co. had an interest, you were fired from
that job?
Mr, Press, Yes, sir,
Mr, Kennedy, And the union supported that ?
Mr, Press, Mr, Crane was good enough to come out on the job at 8
o'clock the next morning with Mr. Oliver, and they went and talked
with the superintendent, and I forget his name now, and when we came
out Mr. Crane said, "There is nothing I can do. You are just fired,
I will give you another job,"
Mr, Kennedy, I just want to see if we cannot summarize what you
feel is wrong with the local at the present time.
Senator Kennedy, Could you just tell me how you get to be a mem-
ber, Mr, Donath? In the local out in Chicago, who decides whether
you should be permitted to join ?
Mr, Donath, In my particular case, you mean ?
Senator Kennedy, If anybody wants to join, what are the steps they
go through, and who decides whether they should be permitted to join
the local?
Mr. Donath, Usually you start in as an apprentice hoisting engi-
neer.
Senator Kennedy. Can anyone join, or do you have to go before an
examining board or something ?
Mr. Donath. No.
Senator Kennedy. How do they determine that ?
Mr. Donath. I guess it is who you Imow.
Senator Kennedy. You are not permitted to vote on those cases, I
understand.
IMPBOPER ACTIVITIES IN THE LABOR FIELD 8267
Mr. DoNATH. That is right.
Senator Kennedy. How do you get to be a senior member ?
Mr. DoNATii. "Well, in order to become a regular member of the
organization, it is at the discretion of the officers.
Senator Kennedy. What is that?
Mr. DoNATH. At the discretion of the officers.
Senator Kennedy. So the officers of the local decide whether you
should be moved from being a nonvoting member to being a voting
member of the local ?
Mr. DoNATH. That is right.
Senator Kennedy. So that in other words there are no definite
standards of time and experience which permit you automatically to
become a senior member.
Mr. DoNATH. No ; there is not.
Senator Kennedy. Xow, as far as the jobs themselves are concerned,
who decides whether you will get work for the day ?
Mr. DoNATH. Pardon me.
Senator Kennedy. Who decides, if you are a senior member of
local 150, whether you will get a job on that day? Who does the
hiring ?
Mr. DoNATH. The officers. They send you out from the hall.
Senator Kennedy. The officers of the union ?
Mr. DoNATH. That is right.
Senator Kennedy. The officers of the local. And supposing the
officers of the local did not want to put you to work, and let us say there
is only a limited amount of work available, can they discriminate
between one member of the local and another ?
Mr. DoNATH. If they desire to ; yes.
Senator Kennedy. So in other words it is not the contractor who
does the hiring in these cases, it is the officers of the union ?
Mr. DoNATH. That is right, sir.
Senator Kennedy. They determine who joins the union and they
determine who works once they are in the union ?
Mr. DoNATH. That is right.
Senator Kennedy. AVlien you say it is possible for them to beat you
in an election, do you mean that it is possible that their wishes repre-
sent a majority of the membership, or how is it possible for them to
beat you in an election ?
Mr. DoNATH. It is possible this way. Senator, that the membership
of local 150 are so afraid to get on tlie floor and state any bad conditions
on a job for fear of reprisals to the effect that they will be fired and
lose their employment and that they will be discriminated against
by the officers of the organization and let to sit around for a few
weeks until they get good and hungry, and that will teach them a
lesson so that when they do go back to work they will keep their mouth
shut and go along.
Senator Kennedy. AVhether the local is in trusteeship or not, the
officers of these locals really have tremendous control over the lives of
the members, is that correct ?
Mr. Donath. That is right.
8268 IMPROPER ACTIA'ITIEiS IN THE LABOR FTE^LD
Senator Kennedy. This is a summing up by the staff, is it, of the
grievances ? Could you answer, Mr. Donath, whether these grievances
are in accordance with your experience, that local 150 has :
1. An undemocratic system of international supervision, denying
the members the right to elect any of their officers, or having anything
to say about the way their local is operated.
Mr. DoNATH. That is right.
Senator Kennedy. No. 2. The withholding of information as to
how much our officers are paid, and what our expenses are for. All
unusual expenditures made from the treasury of our local, outside
of normal operating expenses, should be approved by the members at
a special meeting.
Mr. Donath. That is right.
Mr. Kennedy. Could I interrupt there. Did you receive notifica-
tion that the local was purchasing Cadillacs for William E. M;aloney ?
Mr. Donath. We never received any information of any kind, Mr.
Kennedy.
Mr. Kennedy. Did your membership ever know that you had pur-
chased Cadillacs for Mr. William E. Maloney ?
Mr. Donath. No, sir.
Mr. Kennedy. You did not know until these hearings ?
Mr. Donath. I didn't know a thing about it until these hearings.
Mr. Kennedy. That is several Cadillacs.
Mr. Donath. I was surprised.
Mr. Kennedy. Did you know about the television set ?
Mr. Donath. No, sir ; I did not.
Mr. Kennedy. And the airconditioner ?
Mr. Donath. No, sir ; or the yacht either.
Senator Kennedy (continuing) :
We the members, want the right to nominate and elect delegates to the inter-
national convention by secret ballot, and have a secret ballot vote on all vital
questions.
Mr. Donath. That is right.
Senator Kennedy. And 4 :
We want to have the right to have a wage and working agreement committee
composed of one-half officers and one-half members of the local, approved by
the members.
Mr. Donath. That is right.
Senator Kennedy. That deals with the problem we are discussing
about the assignment of work. This deals with that problem ?
Mr. Donath. No ; this deals with the making up of working agree-
ments for the various contractors and the wages to be paid.
Senator Kennedy. And No. 6 :
The members should have the right to adopt policies in a democratic manner
which would eliminate the vicious practice of men being brought in from out-
side areas who pay permit fees and replace regular members on jobs.
Mr. Donath. Yes, sir.
The Chairman. In that connection I have received, since we started
these hearings, complaints of that nature, not only in this union but
in others. Thei-e seems to be a kind of a practice in some areas, at
least, and in some unions, that here is a local that is constituted of
men who live there, and who have paid their dues and have been
members for years, and some work project comes along and the offi-
IMPROPEK ACTIVITrEiS IN THE LABOR FIEI.D 8269
cers can, and frequently do, let people come in from other States or
other areas who are possibly members of other locals, and let them
come in and pay a permit fee and ^ive them a job. And the fellow
who is locally there who is supporting the union, he does without a
job. Is that a practice that prevails in your union ?
Mr. DoNATH. It does, I believe, or I was informed by one of the
members who attended the last meeting that there were quite a few
men out of work, and just the other day we were cutting the main
for a sewer project on Roscoe, by the San Tusie Construction Co.
He had 4 pieces of equipment on the job, and he had 2 engineers
there.
Wliile I was there, the air compressor had stopped running, so he
called the man oif the bulldozer and told him to go over and check
the air compressor to see what was wrong with it. So I walked over
to him, and I asked him where the engineer was that was supposed to
be on the compressor, and he said, "We don't have one," and I said,
"How long have you been without an engineer ?" And he said, "There
hasn't been any since I have been here." I says, "How long have you
been on the job?" and he said, "A couple of weeks."
(Present in the hearing room. Senators McClellan and Kennedy.)
The Chairman. That would be where they were letting them get
by without complying with this contract?
Mr. DoNATH. That is right, sir.
The Chairman. I see the other witness there indicates he is fa-
miliar with it.
Will you comment on it?
Mr. Press. Yes, sir; our last meeting in Highland, Ind., that is a
branch meeting
The Chairman. It is a branch of the local?
Mr. Press. Yes, sir. I asked how many men were out of work in
our local there in Hammond and he said, I believe it was 146 or 148.
I said, "Now, how many permit men are in the area?" This assistant
business agent said 46.
The Chairman. You had 46 permit men in there from other areas
working ?
Mr. Press. Yes, sir.
The Chairman. While 146 of your regular members of that local
\vere still out of work?
Mr. Press. They also let them take a voice vote in a meeting.
The Chairman. Let who take a voice vote?
Mr. Press. These permit men. Mr. Crane let them vote, let them
in. Half the time they don't have a doorman. They don't check
their votes.
The Chairman. They let them come in and vote ?
Mr. Press. Yes.
The Chairman. If it serves the purpose of the officers ?
Mr. Press. They tell them to come in.
The Chairman. That is when it serves the purpose of officers.
They would not permit them to vote if there was a challenge made
to the officers ; would they ?
Mr. Press. That is right. I brought it up again January 16 about
getting out from under international supervision. Mr. Crane says
we will take a vote on it. I wanted to take a vote for all the members
21243— 58— pt. 20 23
8270 IMPROPER ACTIVITIEiS IN THE LABOR FIELD
in the whole local 150. "No," he says, "we will vote right now
if you want to." I wanted to vote, to get a chance to vote on it. So
he took the vote, a voice vote. He allowed those permit men to
speak up.
The Chairman, Who were not members of the union and were
simply working under permit ?
Mr. Press. That is right.
The Chairman. So when you were challenging the way they were
operating it, when you wanted to get it back into the control of the
members who supported it, when that challenge was up and that
was the issue? He permitted the permit men to vote?
Mr. Press. That is right.
The Chairman. And counted their vote ?
Mr. Press. A voice vote. I did not want a voice vote, but in order
to get any kind of vote, I had to take it that way. We were shouted
down.
The Chairman. By the permit men ?
Mr. Press. Yes.
The Chairman. Is that right ?
Mr. Press. Yes.
Now, at our next meeting all of our men will be there and we can
do most anything we want then.
The Chairman. You are going to have all of yours tliere the next
time?
Mr. Press. Yes ; we are going to try to.
The Chairman. I hope it works and you get what you want, but
from past experience and the record we have before us here
Mr. Press. We have never gotten anything yet.
The Chairman. You have never gotten anything yet ?
Mr. DoNATH. Mr. Senator, can I ask a favor before you adjourn?
The Chairman. Yes.
Mr. DoNATH. Would you give us the same statement you made to
Mr. Dekoning when those witnesses left the chamber?
The Chairman. Yes, sir. That is a standing order so far as the
Chair is concerned, and this committee is concerned.
I appreciate very much that you rank-and-file members, when you
come up here and testify, are taking a risk because of the power that
these officers have, and particularly these appointed officers, super-
visors, over a local such as yours, and they can easily undertake to
retaliate and discriminate against you.
And if you receive any threats with respect to your testimony here,
any attempt is made to intimidate or coerce you, or threaten you in
any way, you report it to this committee.
And as I have stated before, I shall regard it as contempt of the
United States Senate and Ave will ask the committee to proceed ac-
cordingly. Such action would in my judgment be a defiance of the
autliority of the Federal Government by trying to coerce and intimi-
date witnesses from getting the facts and the truth that this Congress
needs upon which to predicate remedial legislation. If any such acts
occur, ai\y such incidents occur, please report it immediately to this
committee.
Mr. DoNATH. Thank you very much, sir.
Mr. Press. At the end of this last meeting Mr. Crane says to me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8271
The Chairman. Your what ?
Mr. Press. Your turn is coming. I don't know what he meant. I
would like to find out what he meant.
The Chairman. If he makes any more such statements or anything
occurs, you let us know. Maybe Mr. Crane can come up here and
testify.
The committee will stand in recess until 2 o'clock this afternoon.
(Thereupon, at 12 : 35 p. m., the committer was recessed, to recon-
vene at 2 p. m., same day.)
AFTERNOON SESSION
(At the reconvening of the committee, the following members were
present: Senators McClellan, Goldwater, and Mundt.)
The Chairman. The committee will come to order.
Mr. Kennedy. Mr. Chairman, we talked this morning about local
150, under trusteeship in Chicago, and also about local 399. We went
into some of the alleged misuses of union funds of local 150.
Now, I would like to liave some staff investigators testify on their
examination of the records of local 399 which as we have pointed out
lias been under trusteeship since 1929.
Tlie main witness was to be Anton J. Imhahn. He is a vice presi-
dent of the Operating Engineers, but we have received a doctor's
certificate from his doctor who said that he was unable to attend the
hearing. He was the supervisor of local 399.
We then expected to have Mr. Andrew Leach, who is his assistant
supervisor, and he has also gone to the hospital.
The Chairman. These doctor's certificates or letters from doctors
may be printed in the record at this point.
I do not know how many of these people are really sick or what
kind of sickness they are having right now. I assume that it is of
such nature that they cannot attend.
We will make these certificates part of the record.
(The certificates are as follows :)
Chicago, III., Jan nan/ 15, 195S.
Senator Jonx L. McClellan,
Senate Office Building, Washington, D. C.
(Attention: Robert F. Kennedy.)
Dear Senator McClellan : This is to certify that Mr. Andrew Leach has
lieen under my professional care since ^Tune 9, 1957. A few days prior to that
time he suffered a stroke involving the right side of his body and connected also
with loss of speech. Since that time Mr. Leach has improved constantly, so
nuu'h so he can walk, to some extent use his right arm and his speech has also
returned to a great extent.
The pdssibility of f'lrtlier strokes under stress has to be considered. Since
(his cerebrovascular accident, Mr. Leach has shown some signs of personality
change, especially restlessness and excitability, which probably would make him
a poor witness before any court.
It is my opinion that it might be detrimental and dangerous to Mr. Leach's
health for him to appear in Washington for the purpose of testifying before the
United States- Senate Select Labor Committee.
Sincerely yours,
Ericj[ Liebert, M. D.
8272 IMPROPER ACTIVITIES IX THE LABOR FIE'LD
St. Bernard's Hospitax,
Chicago, III., January 10, 1958.
Senator John McClellan,
Senate Office Building, Washington, D. C.
Dear Sir : This is to state that Mr. Anton J. Imhahn has been and still is a
patient at St. Bernard's Hospital under my care. He is suffering from acute
cardiac decompensation. His present condition would not warrant interro-
gation.
Due to the serious nature of his condition he may be hospitalized for another
2 months or more.
Very truly yours,
Samuel S. Dubovy, M. D.
The Chairman. If we find this committee is being imposed upon,
we will hold somebody to account. We were really satisfied that Mr.
Maloney was not able to attend. His reports are that his condition
is improving. Therefore, when this committee adjourns this after-
noon, at which time we expect to have concluded this particular series
of hearings, subject to their being reopened to hear Mr. Maloney. I
understand, I hope this is correct information, that Mr. Maloney's
condition is improving. I sincerely trust that it improves sufficiently
that he can give us the benefit of his presence and I hope at that time
his testimony.
All right, proceed.
Mr. Kennedy. Mr. Moran and Mr. Calabrese.
Mr. Chairman, both of these gentlemen have been sworn.
TESTIMONY OF ALPHONSE CALABRESE AND HARRY MORAN—
Resumed
Mr. Kennedy. Mr. Calabrese, you, Mr. Moran, and Ted Symon
have made a study of local 399.
Mr. Calabrese. That is correct.
Mr. Kennedy. And Mr. Symon is an accountant and he has worked
under the direction of the committee and he has done a good deal of
this work?
Mr. Calabrese. That is correct.
Mr. Kennedy. The finances of local 399 ?
Mr. Calabrese. That is so.
Mr. Kennedy. And Mr. Moran, you assisted in that matter ?
Mr. Moran. Yes.
Mr. KJENNEDY. This is the local in which Mr. Imhahn is the trustee
and Mr. Leach is the assistant ; is that correct ?
Mr. Calabrese. Yes ; Mr. Imhahn is the supervisor.
Mr. Kennedy. And Mr. Leach is the assistant supervisor ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Now, did you find that there were a number of per-
sonal purchases and personal bills that were paid by this local for
Mr. Imhahn and Mr. Leach ?
Mr. Calabrese. We did.
Mr. Kennedy. Did you, for instance, find that Mr. Leach had a
membership in the Wing and Fin Hunting and Fishing Club ?
Mr. Calabrese. Yes ; we did.
Mr. Kennedy. Did you find that the union paid for his membership
in the Wing and Fin Hunting and Fishing Club I
Mr. Calabrese. That is correct.
IMPROPER ACTIVrriEiS IN THE LABOR FIELD 8273
Mr. Kennedy. To the total of what ?
Mr. Calabrese. $1,031.11 for the period 1951 to 1953.
Mr. Kennedy. That was paid out of union funds %
Mr. Calabrese. Yes ; that is correct.
Mr. Kennedy. Now, what does the Wing and Fin Hunting and
Fishing Club do ? What does it consist of ?
Mr. Calabrese. The membership is allowed to hunt and fish in this
area, on the ground that they own.
Mr. Kennedy. What sort of charges did Mr. Leach liave for that
club?
Mr. Calabrese. We found charges such as these:
Eaising birds annually, $350.
]\Ir. Kennedy. Did the union pay $350 for raising Mr. Leach's
birds?
Mr. Calabrese. That is correct.
Dressing 16 ducks, $8.
Dressing 12 pheasants, $6.
Mr. Kennedy. That was paid for by the union ?
Mr. Calabrese. That was paid for by the union.
Mr. Ejennedy. Did he also have a gunrack ?
Mr. Calabrese. Also a gunrack which cost the union $10.
Mr. Kennedy. What about mounting the fish that he caught?
Ml-. Calabrese. Now, these fish were caught down in Miami. There
were charges that the union paid for mounting of a tarpon, $21.
Mounting of a Jack, $11.50.
Mounting of a bonefish, $17.50.
And mounting of a trigger, $10.
Mr. Kennedy. Those are some of the examples of the payments
by the union for Mr. Leach ; is that correct ?
' Mr. Calabrese. That is correct.
Mr. IvENNEDY. Did Mr. Leach and Mr. Imhahn also make some
purchases at a gourmet shop out in Chicago ?
Mr. Calabrese. They did.
Mr. Kennedy. It is called the "Stop and Shop" ?
Mr. Calabrese. That is correct.
Mr. KJENNEDY. What was the total amount of purchases by Mr.
Leach at this store ?
Mr. Calabrese. During the period 1950 to 195Y the total was
$15,119.20.
Mr. Kennedy. And by Mr. Imhahn ?
Mr. Calabrese. $2,447.12.
Mr. Kennedy. Making a combined total of ?
Mr. Calabrese. $17,566.32, that the union paid.
Mr. Kennedy. And this was all out of union dues ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Wliat sort of things did Mr. Leach and Mr, Imhahn
use union funds to purchase ?
Mr. Calabrese. Mr. Leach
Mr. Kennedy. I might say, Mr. Chairman, we have an example of
this which we have mimeographed which you might want to examine
and possibly put in the record.
The Chairman. Mr. Calabrese, was this mimeographed list pre-
pared under your supervision ?
8274 IMPROPER ACTIVITIEiS IN THE LABOR FIELD
Mr. Calabrese. It was, Senator.
The Chairman. Are you prepared to state that it is accurate on
tlie best information you have and adopt this as yours ?
Mr. Calabrese. I am.
The Chairman. The mimeograph of this may be made exhibit No.
122.
(The document referred to was marked "Exliibit No. 122" for ref-
erence, and may be found in the files of the select committee.)
The Chairman. Now, you may testify to diiferent items in it, if
you care to.
Mr. Kennedy. Give us some examples of the things bought?
Mr. Calabrese. One of the items was 3 cases of Old Forester, at
$94.50.
A case of Haig & Haig, $82.50.
Twenty poimds of almonds, $9.80.
Bill Baxter lemon soda, $7.90.
Crepe Suzettes. $27.
Parrot liquor, $9.40.
The Chairman. Wliat kind ?
Mr. Calabrese. Parrot.
The Chairman. Is that to make a parrot talk ?
Mr. C vlabrese. T don't know what type it is.
Mr. Kennedy. We inquired and we understood it was liquor that
you Doured over a stuffed parrot. That was $9.40 ?
Mr. Calabrese. Yes.
The Chairman. It is wovth more than the stuffed parrot.
Mr. Calabrese. Twelve French pastries at $52.10.
Pioneer minced clams, $2.94.
Mr. Kennedy. Do you know what Pioneer minced clams are ?
Mr. Cal/\brksk. No? excent Pioneer might be the brand name.
Twelve chocolate filled sti^^ks, ^17.82.
Mr. Kennedy. This is all union money being used to make these
purchases ?
Mr. Calabrese. That is correct.
Twelve artichoke bottoms, $15.15.
Twelve goose livers, $83.40.
The Chairinian. How much ?
Mr. Calabrese. $83.40.
The Chairman. For 12 <roose livers?
Mr. CALABRESE. That is the way the invoice shows.
The Chairman. Sir?^
Mr. Calabrese. That is how the invoice indicates it.
The Chairman. Does it show whether they were cooked or not ?
Mr. Calabrese. That is all. Senator.
Senator Goldwater. Mr. Chairman, I think that would be the goose
that laid the golden er^g.
Mr. Calabrese. Two cases of Mumm's champagne, $154.
Two cases of Burgundy, $65.
Fourteen-carat "old locket, $45.
Mr. Kennedy. Is that in the S+op and Shop ?
Mr. Calabrese. That is not. We are out of the Stop and Shop.
Mr. Kennedy. The Stop and Shop was the food. H. & P. salad
sticks were $6 ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8275
Mr. Calabrese. Yes.
Mr. Kennedy. And 100 tins of frozen orange juice, $21 ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Fifty frozen true blue berries, $19.50.
Mr. Calabrese. That is correct.
Mr. Kennedy. You made a list of items of foods that were pur-
chased out of union funds for Mr. Leach and Mr. Imhahn; is that
correct ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Now, that was a total altogether of some $17,566.32 ;
is that correct?
Mr. Calabrese. That is correct.
Mr. Kennedy. There were further items that were sent, of another
possibly $10,000, but we don't Iviiow where they ended up; is that
right 'I
Mr. Calabrese. That is correct.
Mr. Kennedy. They were sent to the union, local 399 ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Or the person picked them up was unidentified ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Imhahn and Leach can be identified with the
$17,566.32, but the total purchases were $27,624.37, and the items were
similar to the items that are on this list ?
Mr. Calabrese. That is correct.
Mr. Kennedy. Did you find that they made some purchases at the
Central Monogram Works ?
Mr. Calabrese. We did.
Mr. Kennedy. Those purchases were made by whom ?
Mr. Calabrese. By Mr. Leach.
Mr. Kennedy. And that totaled how much ?
Mr. Calabrese. $5,399.55, for the period 1951 to 1952, 1955 to 1956.
Mr. Kennedy. Will you give us some examples of those purchases?
Mr. Calabrese. Fourteen-carat gold locket, $35.
Marcasite brooch, $45.
Fourteen-carat gold letter opener, $60.
Fourteen-carat gold calendar, $50.
Fourteen-carat gold buckle, $60.
Fourteen-carat gold cuff links, $45.
Fourteen-carat gold tie pin. $22.50.
Fourteen-carat gold locket, $105.
Fourteen-carat antique design watch, $295.
(At this point Senator Mundt entered the hearing room.)
Mr. Kennedy. For a total of $5,399.55, of those kinds of purchases.
Mr. Calabrese. That is correct.
(At this point Senator Goldwater retired from the hearing room.)
Mr. Kennedy. Now, w^e find also he was a member of the Tam-0'-
ShanterClub?
Mr. Calabrese. Yes, sir.
Mr. Kennedy. That was not approved by the membership ?
Mr. Calabrese. No, sir.
Mr. Kennedy. The total of that from 1951 to 1954 for Mr. Leach
was $2,911.35?
Mr. Calabrese. That is right.
8276 IMPROPER ACTIVITIES I]S^ THE LABOR FIELD
Mr. KJENNEDT. He also made some purchases at Tam-0-Shanter
pro shop ?
Mr. MoRAN. Yes, sir; we have affidavit from the former pro at the
Tam-0-Shaiiter pro shop and he enmnerated items purchased by Mr.
Leach.
Mr. IvENNEDY. That was for a total of $911.91.
Mr. MoRAN. Yes, sir.
Mr. IvENNEDY. Will you submit the affidavit to the chairman ?
Mr. MoRAN. Yes.
The Chairman. The affidavit appears to be in order. It may be
made exhibit No. 123 and excerpts of it may be read into the record.
(The document referred to was marked "Exhibit 123" for reference
and may be found in the files of the select committee.)
Mr. MoRAN. I will read the last three paragraphs of an affidavit
from Willard Gordon, the former pro at the Tam-0-Shanter Country
Club. The affidavit is dated January 17, 1958 :
I do not have any records now of the transactions with Mr. Leach. He got
all of the individual statements made out in detail to him and also the state-
ments made out to the union. After he picked these statements up and until the
account was paid by the union, my only record of the obligation was notations
in his account of the total amount due. And after the account was paid this
latter record was of no further value to me.
These purchases at the Pro Shop by Mr. Leach went on for about a year or a
little more and then stopped. I do not know why he quit buying unless the
answer is that only so much can be bought in such a shop until the saturation
is reached.
I recall that among Mr. Leach's purchases were a good many sports slacks,
sweaters, shirts, and at least one set of golf clubs, about $40 worth of plastic
shirt boxes apparently for himself, and near Christmas he bought a number of
items, mostly sports clothing, apparently for friends of his whom I do not
know.
I do not recall the total amount spent by Mr. Leach in the Tam-0-Shanter Pro
Shop, but the suggestion that it was around $900 seems about right.
Then he goes on to swear that the statement is true.
Mr, Kennedy. He said there that Mr. Leach made purchases for
about a year and then stopped, and the only conclusion that he could
come to was that Mr. Leach had reached the saturation point.
Mr. MoRAN. That is correct.
Mr. Kennedy. I see on this group of samples that we have a trim-
mer and edger. Would that have to do with golf ?
(At this point Senator Goldwater returned to the hearing room.)
Mr. MoRAN. No, I don't believe so. That is in connection with the
shrubbery and garden supplies that were purchased for Mr. Leach.
Mr. Kennedy. Now, Mr. Leach made some purchases from a
taxidermist ?
Mr. MoRAN. That was in connection with stuffing of the fish or
mounting of the fish that were enumerated on the example list.
Mr. Kennedy. That was $60 worth of stuffing of fish?
Mr. MoRAN. That is correct.
Mr. Kennedy. Then he used some money of local 399 to purchase
a portrait.
Mr. MoRAN. Yes, he did.
Mr. Kennedy. Will you explain that?
Mr. MoRAN. The portrait was made from a photograph of Mr.
Leach at a hotel in Miami, Fla., I believe.
H^IPROPER ACTIVITIES IX THE LABOR FIELD 8277
Mr. Kennedy. It was a portrait painted of a picture of Mr. Leach?
Mr. MoRAN. That is right.
Mr. Kennedy. Was that donated to the union?
Mr. MoRAN. No, I believe he kept tlie portrait. We don't know
what became of the portrait, but we do know it was paid from union
funds.
Mr. Kennedy. $250 was used to paint this portrait of Mr. Leach?
Mr. MoRAN. Yes.
]Mr. Kennedy. You have not seen the portrait?
Mr. MoRAN. No, I haven't.
Mr. Kennedy. Was that approved by the membership?
Mr. MoRAN. No, sir.
Mr. Kennedy. Now, we have here shrubbery and garden supplies.
Will you tell us about that ?
Mr. Calabrese. Yes. Mr. Lerch purchased for the period 1956-57,
$2,137.77 worth of shrubbery and garden supplies from the Jensen
Floral Co., in Chicago These bills which were incurred were paid
by local union 399 union funds.
Mr. Kennedy. Can you give us some samples of the things he
purchased ?
Mr. Calabrese. Yes. A bag of Kentucky bluegrass, $56.56.
Mr. Kennedy. Out of union funds ?
Mr. Calabrese. This is all out of union funds.
Fifty-pound bag of Golden Vigoro.
A roller, 14 by 20, $8.56.
A dozen gloves, $4.74.
A bean sprayer, $28.80.
Twelve pounds of crab-grass killer, $20.40.
Arton Sodar, $43.20.
Trimmer and edger, $17.80.
Senator Goldwater. Did you look at the minutes of this local?
Mr. Calabrese. Yes, the minutes have been reviewed from 1950
until 1957, Senator.
Senator Goldwater. Did you find any record of any of these ex-
penditures having been approved by the membership ?
Mr. Calabrese. The record does not show that. Senator.
Senator Goldwater. Do you know of any blanket authority being
given to anyone to make these expenditures of this kind ?
Mr. Calabrese. The record does not show that.
Senator Goldwater. Who approves in this local the spending of
money ?
Mr. Calabrese. Every bill is approved and signed by Mr. Imhahn,
the supervisor. A copy, as I understand it, of the daily expenditures
are sent to the international president, Mr. Maloney, since it is under
trusteeship.
He has the duty or responsibility of looking over these expenditures.
Senator Goldwater. Is the nature of the expenditures noted in the
ledger ?
Mr. Calabrese. No ; not as such. We had to go back to the invoices
to determine.
In other words, in the ledger would be to Tam-0-Shanter or the
Jensen Floral, but we would have to go back to the invoices to know
the nature of the expenditure.
8278 IMPROPER ACTIVITIES IN THE LABOR FTEOLD
Senator Goldwater. In your examination of the minutes did you
find any evidence of union expenditures being discussed with the
membership ?
Mr. Calabrese. There were none, Senator.
Senator Goldwater. At no time did the treasurer stand up and make
a treasurer's report ?
Mr. Calabrese. I can answer the question in this way: The only
person during our interrogation of the officials of the local union, the
only person we understand knew about these expenditures were Mr.
Imliahn and Mr. Leach. The secretary did not know what these ex-
penditures, what the union funds were being spent for.
Senator Goldwater. Did you find any place in the minutes any
record that any member had ever asked to see the financial records of
the union ?
Mr. Calabrese. I can recall of none, Senator.
Senator Mundt. Did your examination of the record disclose where
this shrubbery was delivered ?
Mr. MoRAN. I did not hear the question.
Senator Mundt. Did your examination of the records disclose
where the shrubbery was delivered ?
Mr. MoRAN. Yes, sir ; it did.
Senator Mundt. Will you explain about that ?
Mr. MoRAN. I have the invoices from both the Jensen Floral Co.
and a wholesale distributor that supplied the Jensen Co.
On those invoices it will show the name and address of the place
of delivery. And on those it would sliow Mr. Andrew Leach.
In some cases where it was not delivered to his home it will have
Mr. Leach pick up. That will mean it was picked up at the store.
Senator Mundt. It did disclose sufficient evidence to indicate that
this shrubbery was being used to beautify the grounds of Mr. Leach's
permanent home ?
Mr. MoRAN. That is right, sir.
Senator Goldwater. I would like to ask one more question regard-
ing these minutes.
In your examination of the minutes did you find any record of an
election having been held ?
Mr. MoRAN. There has never been an election. To answer your
question there was no record of any election. There has not been an
election for many years in local 399.
Senator Goldwater. Am I right in recalling that it has been 29
years since there has been an election in this local ?
Mr. MoRAN. They have been under supervision since 1929, Senator.
(Present in the hearing room: Senators McClellan, Mundt, and
Goldwater. )
Senator Goldwater. It has been 29 years since they have had an
election ?
Mr. Calabrese. Yes, sir.
Senator Goldwater. Has there be any effort that you have dis-
covered by the membership to change that status ?
Mr. Calabrese. There has been one instance and I will have to check
my record on that. I believe in 1953 Mr. Maloney, shortly after he
had testified before another committee, another congressional com-
mittee, who had inquired into the tiiisteeship, had written Mr. Im-
IMPROPE'R ACTIVrTIES IN THE LABOR FIELD 8279
halm asking him whether it was not time to give consideration to the
release of supervision of 399.
Mr. Imhalm wrote Mr. Maloney and told him that he would take
it up at some subsequent date with the membership. My recollection
is that not until 1956 was the question of release of supervision
brought up before the membership. At that time a laudatory speech
was given of supervision and the record shows, or the minutes show
that the membership voted unanimously to go along with the super-
vision.
Now I have the specific documents there.
Senator Goldwater. In that connection, to develop a possible an-
swer as to why there was unanimous decision to stay under trustee-
ship, am I right in recalling that in order for a man to get a job where
this local has jurisdiction, he applies to the union for that job, is that
correct ?
Mr. Calabrese. Senator, I think perhaps that question would be
better answered of Mr. Brady, the secretary-treasurer of 399. This is
a stationary engineer local and it is different from the hoisting engi-
neer local of 150. To give you a correct and proper answer, that would
have to be done.
Senator Goldwater. Could the counsel refresh my memory on that ?
Mr. Kennedy. The testimony that has been developed so far be-
fore the committee is that as far as the Operating Engineers are con-
cerned— it is possible that this local may be an exception but generally
it has been the rule — they must go to the union and the union officials
in order to get a job.
The contractors go to the union and then the union officials are the
ones who decide who is going to get the job. So the results are, that
if there is any opposition to the incumbent officials, those people can
be cut olT from work. We have developed that in a number of dif-
ferent locals during this hearing.
Senator Goldwater. It is not difficult to understand why the mem-
bership was unanimous in approving the operation under which they
were operating. If a man objected to it, the chances of his not work-
ing the next day would be very good.
Mr. Kennedy. Not only that, but in this other local that has also
been under trusteeship, the man w^ho led the opposition for approxi-
mately 6 years ended up with 3 bullets in his head.
Then further on, we develop the fact that those who have opposed
the leadership have been discriminated against as far as jobs were
concerned, and where the local 150 voted on 1 month to get out of
supervision, the next month the place was packed and they reversed
themselves completely, supposedly or allegedly, and of course they
have no secret ballot.
Senator GoldWx\ter. That practice is not only immoral, it is also
illegal. I just wanted to bring out the fact that here is a case preva-
lent in this union, and I suppose in otliers, where a man actually
cannot work or he has not the right to a job.
Therefore, he has not the right to life, liberty, and the pursuit of
happiness unless he does exactly as the union leader says. Of course,
this only bears out, Mr. Chairman, my contention that unless this
Congress recognizes the right to work as one of the basic rights of
Americans, we are not performing our full responsibility to the
8280 IMPROPER ACTIVITIES IX THE LABOR FIELD
American workers. I think we can talk all we want to about writing
legislation to prohibit this, and that, and the other thing, and writing
legislation to insure democracy in unions.
But I am convinced as one member of this committee that until
we give the man the right to quit his union and not lose his job, we
are not going to police these unions because you do not police a demo-
cratic process from the top, you police democratic processes from
down below. I think this is a very flagrant example of how a union
should possibly be run in Eussia, but not in the United States. I do
not want to bore the committee with my observations on right to work
because I think they are pretty well known, but this is an exact exam-
ple of what I have been talking about occurring not only in this union,
but other unions where a man cannot live and cannot enjoy the rights
that are guaranteed him under the Constitution unless he kowtows to
a labor leader.
Mr. Ivennedy. Mr. Calabrese, we also have listed certain question-
able hotel charges at Hot Springs, Ark.
Mr. Calabrese. We found that during the period of 1951 to 1957,
Mr. Leach incurred hotel bills and charges at a hotel in Hot Springs,
Ark., in the amount of $8,258.39.
Tlie Chairman. What hotel?
Mr. Calabrese. It is the Arlington Hotel, as we understand it, it
is a spa in Hot Springs, Ark.
The Chairman. A most excellent hotel?
Mr. Calabrese. I would think so.
Mr. Kennedy. Why did we select Hot Springs, Ark., as one in
which the hotel charges were questionable ?
Mr. Calabrese. There were no meetings that we know of that were
held at Hot Springs, Ark. There were no executive board meetings
held there that we know of.
Not that Mr. Leach was a member of the executive board, but even
assuming he would attend one, we found none being held at Hot
Springs, Ark., during this period of time.
The Chairman. In other words, there was no official meetings or
no record of any official meetings of any segment of the union in that
city at that time?
Mr. Calabrese. That is right, Senator.
The Chairman. There may have been a meeting, but obviously it
was unofficial, and possibly secret.
Mr. Calabrese. That is correct.
I might say this, that on some of these things that we put here as
questionable hotel charges, and questionable purchases at Monogram
Works, we had endeavored to obtain an explanation from Mr. Leach.
However, he was incapacitated because of his illness, and he was
not even able to come down and talk to us informally about these
matters, as we had uncovered them by investigation.
Mr. Kennedy. There is no Operating Engineers local that operates
out of Hot Springs ?
Mr. Calabrese. None that I know of, Mr. Kennedy.
Mr. Kennedy. So it did not appear that there was any official
business in Hot Springs, Ark. ?
Mr. Calabrese. There is none that we could find.
Mr. Kennedy. Did he have some extra hotel expenses there?
IMPROPE'R ACTIVrTIEiS IN THE LABOR FIELD 8281
Senator Gold water. Any one that drank that much liquor that is
listed on this item, on these sheets, would have to spend a long time
in Hot Springs.
Mr. IvENNEDY. Did we find other charges in Hot Sprmgs, Ark., that
were paid for by the union ?
Mr. Calabrese. Yes, sir.
Mr. Kennedy. Do you have some examples ?
Mr. Calabrese. Yes, a bathhouse, $17.30 ; massage, $17.45 ; barber
shop, $7.15 ; and toggery, $3.15.
Mr. Kennedy. Do you know what that is?
Mr. Calabrese. I guess it would be clothes, and other than that I
don't know. I liave never been to the Arlington Hotel myself.
Cash paid out by tlie hotel to Mr. Leach in the amount of $50.
Mr. Kennedy. What do we find is the total of these types of items,
the Stop & Shop, the Wing & Fin, the Tarn O'Shanter, the shrub-
bery and garden supplies, the hotel, the jewelry, getting his fish
stuffed, and buying his portrait ? How much does that cost the union ?
Mr. Calabrese. For ]\Ir. Leach, $36,079.28.
Mr. Kennedy. How about Mr. Imhahn ?
Mr. Calabrese. $2,477.12.
Mr. KJENNEDY. And combined ?
Mr. Calabrese. $38,526.40.
Mr. IvENNEDY. In addition to that, there is approximately $10,000
more of Stop & Shop items, is that right ?
Mr. Calabrese. That is correct.
Mr. Kennedy. I think these were all paid for by union funds, is
that right?
Mr. Calabrese. That is right.
The Chairman. That is the same document which has already been
made an exhibit.
Mr, I^NNEDY. Could we have these other records, the exhibits for
reference, Mr. Chairman, the record from which these items have been
taken ?
The Chairman. They may be made exhibit No. 122A.
( Document referred to was marked "Exhibit No. 122A" for refer-
ence and may be found in the files of the select committee.)
Mr. IvENNEDY. Mr. John F. Brady is the next witness.
The Chairman. Will you be sworn ?
Do you solemnly swear that the evidence, given before this Senate
select committee shall be the truth, the whole truth, and nothing but
the truth, so help you God ?
Mr. Brady. I do.
TESTIMONY OF JOHN F. BEADY, ACCOMPANIED BY HIS COUNSEL,
EOBERT L. HUNTER
The Chairman. State your name, and your place of residence, and
your business or occupation.
Mr. Brady. My name is John F. Brady, and I live at 9544 South
Damon Avenue, in the city of Chicago. Presently I am financial
corresponding secretary of local 399, B. and C. of Chicago, 111.
The Chairman. Do you have counsel present ?
Mr. Brady. Yes, sir, I do.
8282 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Mr. Counsel, will you identify yourself for the
record ?
Mr. Hunter. Robert L. Hunter, member of the firm of Gregory &
Hunter, 105 South La Salle Street, Chicago, and I am a member of
the Illinois bar.
The Chairman. Thank you very much.
All right, Mr. Kennedy, you may proceed.
Mr. Kennedy. Mr. Brady, you were with the Operating Engineers ?
Mr. Brady. Yes, sir.
Mr. Kennedy. How long have you been with them ?
Mr. Brady. 15 years.
Mr. Kennedy. You have been an officer or you are ?
Mr. Brady. I liave been secretary since 1949.
Mr. Kennedy. Were you elected to that position ?
Mr. Brady. No, I was not.
Mr. IvENNEDY. You are secretary of what local ?
Mr. Brady. 399.
Mr. Kennedy. In Chicago, 111. ?
Mr. Brady. Yes, sir.
Mr. Kennedy. And you were appointed to your position ?
Mr. Brady. In a sense. May I mention it this way, that in the
predecessors in the financial secretary job, when they were on vaca-
tion, or maybe sick, I used to fill in, in their job. My predecessor in
the job was sick, and I filled in there, and he got in such a medical
condition he did not want the job any more, and lie retired back as a
business agent and so I still stayed on as financial corresponding
secretary.
Mr. Kennedy. You held that position for about 9 years ?
Mr. Brady. Since May of 1949.
Mr. Kennedy. You have been in the local for 15 years ?
Mr. Brady. Yes, sir.
Mr. Kennedy. Have they had an election for officers since you have
been in the local ?
Mr. Brady. No, sir.
Mr. Kennedy. When was the last time they had an election?
Mr. Brady. I would not know.
Mr. Kennedy. What are your responsibilities as secretarj^ ?
Mr. Brady. My responsibilities as secretary is to receive all funds
or moneys taken in by the union, to keep an accurate financial account
of each member's name, and address and financial status, and to report
at the end of meetings the income of moneys that we have, and to
report to our membership the amount of members in good standing
at the end of the month, and to be responsible for the per capita tax
stamps that come in, and the welfare or the information in regard
to our membership on reports to the general secretary-treasurer as to
witlidrawals, admissions, deaths, resignations, and things of that
nature.
That is the financial secretaries job, and corresponding secretary, I
answer the information that men may write in, letters addressed to
me for information from the members, tliat is wliat I do as cor-
responding secretary.
Mr. Kennedy. You are responsible for keeping the membership
informed as to the finances ?
IMPROPER ACTIVrriES IN THE LABOR FIELD 8283
Mr. Brady. Wliat income comes in, yes.
Mr. Kennedy, And you do not tell them about what goes out?
Mr. Brady. That is not my duty.
Mr. Kennedy. Do you tell them about what goes out?
Mr. Brady. Yes, at membership meetings, they will report the ex-
penditures and the receipts and disbursements.
Mr. Kennedy. Who reports on that?
Mr. Brady. Mr. Imliahn.
Mr. Kennedy. Who is the supervisor ?
Mr. Brady. Yes, sir.
Mr. Kennedy. And he gives them a report on how the money is
spent ?
Mr. Brady. Not itemized, no.
Mr. Kennedy. Just tells them generally, this money came in and
this much went out ?
Mr. Brady. Keceipts so much and disbursements so much.
Mr. Kennedy. Does he tell them that Mr. Leach spent $350 rais-
ing birds ?
Mr. Brady. I never heard him, no.
Mr. Kennedy. And you attended the meetings ?
Mr. Brady. Yes, I do.
Mr. Kennedy. Or that $8 for dressing 16 ducks, does the member-
ship know their funds have been used for that ?
The Chairman. How about the golden goose livers, was that ever
reported to the meml^ers ?
Mr. Brady. Not to my knowledge.
Mr. Kennedy. Or $9.40 was used to purchase some parrot liquor?
Mr. Brady. No.
Mr. Kennedy. They never were informed of that ?
Mr. Brady. No.
Mr. Kennedy. They are just told so much money came in and so
much money went out?
Mr. Brady. Total receipts for a certain time, and disbursements,
so much.
Mr. Kennedy. Is it felt that that is all they are entitled to know,
being under supervision ?
Mr. Brady. What is that?
Mr. Kennedy. Is it felt that that is all they are entitled to know,
being under supervision ?
Mr. Brady. I would not know how to answer that. I suppose
through a period of years, that is the way it happened and it was
just kept up.
Mr. Kennedy. Do you understand that they have not had a vote
in that union for 29 years?
Mr. Brady. Yes, I do.
Mr. Kennedy. You sign the checks?
Mr. Brady. I countersign checks.
Mr. Kennedy. Why do they have you countersign checks?
Mr. Brady. Well, it is just something that has been going on for
years and years. It was one of the things that the financial secretary
does, and 1 just continue to do the same things as my predecessor.
Mr. Kennedy. Any check that comes over your desk, you just auto-
matically sign it?
8284 EMPROPER ACTIVITIES IN THE LABOR FIEIjD
Mr. Brady. Every one is voucliered for, and it would not be a case
of not knowing a strange check. There is a voucher for every check.
The Chairman. You mean vouchers came over for this list of
things ?
Mr. Brady. Yes.
The Chairman. And you knew it was being paid out for that
purpose ?
Mr. Brady. Well, it came through.
The Chairman. It came through, and you saw it, and you say that
you saw it?
Mr. Brady. Yes, sir.
The Chairman. And you knew all of this was going on ?
Mr. Brady. It just comes through in name.
The Chairman. In name ?
Mr. Brady. Not itemized.
The Chairman. No itemized statement?
Mr. Brady. No.
The Chairman. You do not know what it is for?
Mr. Brady. It just goes to a certain company.
The Chairman. And you are not supposed to know what it is for ?
Mr. Brady. Well, I do not think so, because I don't have any
authority.
The Chairman. Wlio does have authority to know before they sign
a check if you have got to countersign ?
Mr. Brady. Mr. Imhahn, or Mr. Leach that O. K.'s the bills, and
they come through, and they are set up for payment, and when they
come through to me as the countersigner, I sign them.
The Chairman. In other words, you just simply go on the signa-
ture of the other two ?
Mr. Brady. That is right.
The Chairman. And they sign a check and you feel it is your duty
to sign it without inquiring into anything about what it is for or
whether it is accurate ?
Mr. Brady. I have no alternative, and I have no authority to ask.
The Chairman. You have no authority to ask ?
Mr. Brady. No.
The Chairman. And you are just a check signer, and countersigner,
and that is about all, is that right ?
Mr. Brady. Yes, sir.
Mr. Kennedy. Did it ever occur to you that the reason that you
might have the position of countersigning checks was to insure that
the union funds were not stolen ?
Mr. Brady. I never gave it that thought, and I kept it as a duty
of the job.
Mr. Kennedy. What would be the reason for having somebody sign
a check if not to protect the union funds ?
Mr. Brady. I don't know.
Mr. Kennedy. It never occurred to you at all, in 9 years that you
had been signing checks ?
Mr. Brady. That is right.
Mr. Ivennedy. It never occurred to you that you had some respon-
sibility for the money of the union ?
Mr. Brady. In that sense, no, because I felt that if it is O. K.'d
by my superiors, and they say to pay it, whom am I to tell them no.
EMPEOPER ACTIVITIES IN THE LABOR FIELD 8285
Mr. Kennedy. Maybe Mr. Imhahn is stealing the money, and maybe
Mr. Leach is stealing the money also and you were there to counter-
sign the checks ?
Mr. Brady. I don't know.
Mr. Kennedy. You never cliecked it ?
Mr. Brady. I never checked it.
The Chairman. What do you think would have happened to you
if you had refused to countersign a check they approved ?
Mr. Brady. Well, I don't know. I am like an employee there, and
I don't know.
The Chairman. You have some idea about it, do you not ?
Mr. Brady. Yes, sir.
The Chairman. What is that?
Mr. Brady. Yes, sir.
The Chairman. Will you express it?
Mr. Brady. Well, I don't know how to express it. I imagine it is
my duty to sign it as an employee in there, and if you refuse to sign
it, someone is liable to countermand you and want to know why you
want to do something like that.
Tlie Chairman. You would not continue countersigning them, and
you would have been out of business ?
Mr. Brady. It is a possibility.
The Chairman. It is a probability, is it not ; do you agree ?
Mr. Brady. Well, they were in the position to hire me, and I think
they would be in a position to fire me.
The Chairman. They had that power ?
Mr. Brady. Yes, sir.
The Chairman. And you recognized that ?
Mr. Brady. Yes, sir.
Senator Goldwater. Did you have regular audits of your books ?
Mr. Brady. Yes, sir ; we have a yearly audit.
Senator Goldwater. Were those made by outside auditors ?
Mr. Brady. Yes, sir.
Senator Goldwater. Did the auditors ever call attention on their
audit reports to the possibility of misuse of these funds ?
Mr. Brady. They were not to me.
Senator Goldwater. Did you see the copy of the audits ?
Mr. Brady. I have seen some.
Senator Goldwater. Were there any notations that indicated that
they thought these moneys were being improperly spent, or was that
within the province of the auditor ?
Mr. Brady. I can't think from memory, and those audits are there,
and if there are notes in them they would be there. I don't want to
try to guess at notes or something.
Senator Goldwater. There were two audits a year ?
Mr. Brady. One ; we get an audit a year.
Senator Goldwater. Does the international audit the books?
Mr. Brady. No, sir ; an auditing firm.
Senator Goldwater. Were these audits sent on up to the
international ?
Mr. Brady. I believe so, now, and I know one goes to Mr. Imhahn,
and I am pretty sure that the auditing firm would send one to
others.
21243— 58— pt. 20 24
8286 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Goldwater. Mr. Bansler does the auditing?
Mr. Brady. Yes, sir.
Mr. Kennedy. And he was put in that position by Mr. Ma-loney ?
Mr. Brady. He is not in that position. He is an outside auditing
company.
Mr. Kennedy. He also does Mr. Maloney's income-tax returns?
Senator Goldwater. It is a nice combination.
Senator Mundt. Is Mr. Bansley a certified public accountant?
Mr. Kennedy. He is. He felt all he had to do was add the figures
up and make sure one column added up and the other column added
up. He felt that was the extent of his res]3onsibility.
The Chairman. In other words, he did not undertake to make sure
that the expenses were justified ?
Senator Mundt. This audit was really not an audit to determine
whether or not these expenditures were legitimate or illegitimate, but
simply to determine whether or not the reports made to the union
were accurate or not, the amount of money received and the amount
of money spent ; is that it ?
Mr. Brady. I would think that an auditing firm would make a
regular audit there, the same as anywhere else.
Senator Mundt. It would depend a little bit on what kind of under-
standing they had with the auditing firm as to what you Avere
expected to do. You were supposed to make an analysis to deter-
mine the money was appropriately spent, or were you simply going
to check up to see that the bank-account aspects were correct?
Mr. Brady. I would assume that the auditing company would go
in and make an audit the same in our office as in any other industry
or any other company that they would go to.
Senator Mundt. You have seen the auditing reports; I have not.
What kind of auditing reports did they make?
Mr. Brady. Not being an auditor, I did see them, but I am not an
auditor. It looked to me like it was a fine audit, as far as auditing is
concerned.
Senator Mundt. Are you prepared to testify under oath that this
certified public accountant in Chicago sent in a report every year
that they thought these were all legitimate expenses ; that they thought
the books of the company were in good order.
Mr. Brady. No; I do not think I could testify under oath for an
auditing concern.
Senator Goldwater. Mr. Brady, is there anything in yours consti-
tution or bylaws of the local that requires a regular financial report
to the membership ?
Mr. Brady. In the bylaws, I am not sure if there is anything, but
there is under the Labor-Management Act, under the Taft-Hartley
law.
Senator Goldwater. Were those reports made by Mr. Imhahn ?
Mr. Brady. Reports?
Senator Goldwater. Were the reports made to the membership of
these financial situations of the union by Mr. Imhahn, to the union?
Mr. Brady. You mean reports to our members ?
Senator Goldwater. The financial report; yes.
Mr. Brady. After our audit is made, we get copies printed of the
financial report, of the financial condition of the local union, and
IMPROPE'R ACTIVITIES IN THE LABOR FIELD 8287
those are printed, and tliere is a copy for every member that wants
them.
Senator Goldwater. Do you mail those copies?
Mr. Brady. No; we don't.
Senator Goldw^vter. Where are the}' available?
Mr. Brady. They are available in the office, at the dues window,
and we pass them out at the meetings.
Senator Goldwater. Do you cover the membership completely,
you feel, with those?
Mr. Brady. Whoever wants them. We don't try to go around and
hand them to them at this house, but they are there for them, and
we report that the financial reports are there, and when they are at
tlie meetings we pass them out to them and we read them off at the
meetings.
Senator Goldwater. Did Mr. Imhahn at any time make a verbal
report to the membership in the meetings ?
Mr. Brady. Not to my knowledge. It would be part of the minutes,
if he did.
Senator Goldwater. From your memory as financial secretary, did
any member of your local ever question you or any of the officials as
to the expenditures being made?
Mr. Brady. I was never questioned by a member.
The Chairman. Those are financial reports, you give to the mem-
bers just the simple statement we took in so much money this past
year nnd we spent so much ; is that it?
Mr. Brady. A regular report, a regular financial report, financial
statement.
The Chaieman. I do not know whether it was regular, or not. It
was not a complete one that informed them of how the money was being
spent ; was it ?
Mr. Brady. Well
The Chairman. You do not know ?
Mr. Brady. You are talking now about the regular printed finan-
cial report that comes out w^th all of the income and expensas ?
The Chairman. You can show that by saying this ,year we took in
a million dollars, we spent $999,000. We have a balance of $1,000
left.
Mr. Brady. That is not the kind of report it is. It itemizes down
on various funds.
The Chairman. Does it show all these expenditures ?
Mr. Brady. Not itemized.
The Chairman. Did you have a column there showing that you
were buying goose livers or anything ?
Mr. Brady. No, sir.
The Chairman. At this point the Chair will read excerpts from an
affidavit from Mr. Law^rence Hickey.
Do you know Mr. Lawrence Hickey ?
Mr. Brady. Yes, I do. He is the treasurer of our organization.
The Chair:man. The affidavit will be printed in the record in full
at this point and I will read these excerpts from it.
Chicago, III., January 10, 1958.
I, Lawrence Hickey, residing at 7.535 South Marslifield Ave., Chicago, 111.,
make the following signed and sworn statement to A. F. Calabrese and .lack
Balaban, who have identified themselves to me as investigators with the United
8288 IMPROPER ACTIYIT'IES IN THE K\BOR FIErLD
States Senate Select Committee on Improper Activities in the Labor and Manage-
ment Field. I make this true and voluntary statement vpith the full knowledge
that this may be used in open hearings to be held by the United States Select
Committee on Improper Practices in the Labor or Management Field.
I am 67 years of age and have been a member of the lUOE since 1917, and a
member of local No. 399, Chicago, 111., since its inception about 1929.
This local has been under international supervision for many years.
In 1950, I was appointed treasurer of local No. 399 by Mr. Imhahn, the presi-
dent-supervisor of local No. 399. My duties as treasurer is to sign checks drawn
on the local's bank account. Mr. Imhahn and Mr. Brady, the financial secre-
tary of the local, also must sign these checks.
My procedure has been to come down to the local's office 2 or 3 times a month
and sign in blank a number of checks.
I have never seen what the checks are issued for and have never been told, nor
have I inquired as to the specific purpose for which the checks were issued.
Mr. Imhahn would know the purpose for which the checks are issued.
There has never been a meeting of the executive board of the local during the
period that I have been the treasurer.
I have been shown several bills and canceled checks covering purchases of
merchandise and services at the Tam O' Shanter Country Club and the Wing and
Fin Hunting and Fishing Club, Inc., and state that I have never seen these
documents heretofore, and, further, that I know absolutely nothing about who or
why these expenses were incurred.
I received $120 a month from the local as salary for being treasurer. My
full-time occupation, however, is that of a stationary engineer employed by the
City of Chicago Sanitary District, a job that I have held since 1930.
I have read the above statement, consisting of three handwritten pages, and
have initialed each page. Everything therein is true and correct.
Lawrence Hickey.
State of Illinois,
County of Cook, ss:
Subscribed and sworn to before me this 10th day of January A. D., 1958.
[seal] Rosalind Springs,
Notary Public.
My commission expires July 16, 1960.
Witnessed by :
Bart Hickey.
Clarence F. Calabrese.
January 10, 1958.
Senator Mundt. Mr. Brady, did you ever sign any checks in blank ^
Mr. Brady. Yes, sir; I did.
Senator Mundt. Is that your standard operating procedure, you
sign them in blank, the treasurer signs them in blank, and Mr. Im-
hahn carries on from there? Is that the way it is done?
Mr. Brady. That is right.
Senator Mundt. All they would really need down there in that
office is a couple of rubber stamps with your signature on it and the
treasurer's and save that money, if that is all you do ?
Mr. Brady. As I say, there is an O. K.'d bill by Mr. Imhahn and
there is a voucher and that goes through with the check.
Senator Mundt. In other words, as it appears to me — you correct
me if I am wrong — the responsibility for determining who should get
the money, how much money should be paid out, is really exclusively
thatof Mr. Imhahn?
Mr. Brady. That is right.
Senator Mundt. The rest of you fellows carry out a constitutional
function and sign checks without raising any questions, sometimes
signing them in blank in advance ; am I right ?
Mr. Brady. That is right.
Mr. Kennedy. How much salary do you receive?
IMPROPER ACTIVmES IX THE LABOR FIELD 8289
Mr. Brady. I get $8,540 a year.
Mr. Kennedy. xVnd expenses?
Mr. Brady. I get $40 a week.
The Chairman. Expenses ? Forty dollars a week expenses ?
Mr. Brady. Yes, sir.
The Chairman. What expenses do you have ?
Mr. Brady. Well, I go out in the field, too, and negotiate. There are
different expenses of the secretary, buying tickets, buying some ads,
buying somebody a dinner, things of that nature.
The Chairman. Do you submit an itemized statement of your ex-
penses ?
Mr. Brady. No ; that is a straight $40 a week expense.
The Chairman. It is flat ?
Mr. Brady. Yes, sir.
The Chairman. Do you report it on your income ?
Mr. Brady. No, sir ; I don't.
Mr. Kennedy. How much does Mr. Imhahn receive in salary?
Mr. Brady. To my knowledge, from the local, it is $845 a month.
Mr. Kennedy. Do you have a pension from the international? Is
tliere a pension arrangement?
Mr. Brady. There is an international pension I think for inter-
national officers.
Mr. Kennedy. What is that based on ?
Mr, Brady. I don't know.
Mr. Kennedy. I believe the plan is for retirement after 15 years
of continuous service and upon reaching your 60th birthday. The
pension is based on the average of a person's annual earnings durmg
the last 3 years prior to retirement with the recipient receiving 40
percent on the first $3,000 of his salary from the International and
60 percent on his salary in excess of $3,000.
Now, Mr. Imhahn receives his salary from the local ?
Mr. Brady. There is $845 goes from the local to the international
office.
Mr. Kennedy. He has you send his salary in to the international ?
Mr. Brady. That money goes in, I don't know the setup of how his
pension works or his international wages or anything.
Mr. Kennedy. It is sent to the international, and then they put
that together and pay him from the international ?
Mr. Brady. To the best of my knowledge.
Mr. Kennedy. So, therefore, his pension would be that much
greater ; is that right ?
Mr. Brady. I don't know that. I don't understand their pension
law or their systems. That is international.
Mr. Kennedy. The salary from the international would be in-
creased that much by this $845 being sent from the local and then the
international paying him the regular salary plus the $845 he gets
from the local. You did not know that was going on ?
Mr. Brady. I don't understand the setup of the international money.
Mr. Kennedy. He gets a pension based on 40 percent of the first
S3,000 of his salary and 60 percent of the salary in excess of $3,000.
So the more money he gets paid by the international the greater his
salary is ultimately.
8290 IMPROPER ACTWITIES IX THE LABOR FIELD
So to increase the salary from the international he sends his local
salary in to the international and then they combine the both and pay
him. Did yon know he was doing that ?
Mr. Brady. No.
Mr. Kennedy. Do you know the reason why he was doing it ?
Mr. Brady. No ; I don't know that. I don't understand.
The Chairman. Are there any other questions ?
All right, thank you very much.
Call the next witness.
Mr. Kennedy. Mr. Crane.
The Chairman. Mr. Crane, do you solemnly swear that the evidence
you shall give before the select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Crane. I do.
The Chairman. Be seated and state your name, your place of resi-
dence, and your business.
TESTIMONY OF JAMES CEANE, ACCOMPANIED BY COUNSEL,
THOMAS D. NASH
Mr. Crane. My name is James Crane, 3 East 150th Street, Harvey,
111. I am the president of the International Union of Operating Engi-
neers, Local 150, 327 South La Salle, room 732.
The Chairman. Did you say president?
Mr. Crane. Or supervisor.
The Chairman. Well, whichever it is. President and supervisor?
Mr. Crane. Either one.
The Chairman. We have had testimony about supervisor ?
Mr. Crane. I would say president.
The Chairman. I wanted to know if there was any difference ?
Mr. Crane. In this case, no.
The Chairman. You have counsel present ?
Mr. Crane. I have.
The Chairman. Will counsel identify himself.
Mr. Nash. Thomas D. Nash, 111 West Washington Street, Chicago,
111., member of the Illinois bar.
Mr. Kennedy. How long have you been in the Union of Operating
Engineers ?
Mr. Crane. Since 1936.
Mr. Kennedy. You have been an officer for how long ?
Mr. Crane. I was appointed a representative in 1948.
Mr. Kennedy. Have you always been with local 150 ?
Mr. Crane. Always with local 150.
Mr. Kennedy. Have they had an election for officers since you have
been in local 150?
Mr. Crane. Not to my knowledge.
Mr. Kennedy. That is some 22 years ?
Mr. Crane. Twenty-one and a half years.
Mr. Kennedy. Do you know if they have ever had an election for
officers in local 150 ?
Mi\ Crane, No.
Mr. Kennedy. It has been under trusteeship ?
Mr. Crane. Under trusteeship.
IMPROPER ACTIVITIES IX THE LABOR FIELD 8291
Mr. Kennedy. You were appointed to your present position by
^Yhom ?
Mr. Crane. By William E. Maloney.
Mr. Kennedy. Has it been arranged for Mr. William E. Maloney
to receive expenses and certain other gifts or certain other items paid
for by local 150?
Mr. Crane. If it has it was before my time.
Mr. Kennedy. Has any occurred while you have been there?
Mr. Crane. It has.
Mr. Kennedy. What sort of things did he receive by the union?
Mr. Crane. An automobile.
Mr. Kennedy. Cadillac.
Mr. Crane. That is correct.
Mr, Kennedy. For wliat reason did he receive the Cadillac?
Mr. Crane. The Cadillac belongs to local 150. It is endorsed on the
back of the title, the title is kept in our safe, at the address of 32T
South La Salle Street.
Also, the 1950 Ford is not in Mr. Maloney's name. It is in the name
of the International Union of Operating Engineers, Local 150.
Mr. Kennedy. Wliy did he receive a Cadillac ?
Mr. Crane. Because it has been the past practice of giving him a
car. He is a paid-up member of local 150.
Mr. Kennedy. So the membership gets together and gives every
paid-up member of 150 a car?
Mr. Crane. That I don't know.
Mr. Kennedy. Does every member of 150 get a Cadillac?
Mr. CrxVne. They do not.
Mr. Kennedy. I thought you said the reason he did was because he
was a paid-up member of 150.
Mr. Crane. And the president of the International Union. You
might say he is a trustee of local 150. Being the president of the
International LTnion I presume he would be a trustee, too.
Mr. Kennedy. Does every union trusteeship give a Cadillac?
Mr. Crane. Not to my knowledge.
Mr. Kennedy. You took this up with the membership ?
Mr. Crane. I did not.
Mr. Ivennedy. ^Y[\o decided that he was to get a Cadillac ?
Mr. Crane. I bought the Cadillac.
Mr. Kennedy. You decided that ?
Mr. Crane. I decided.
Mr. Kennedy. Who appointed you to your position ?
Mr. Crane. William E. Maloney.
Mr. Kennedy. Were you present when it was decided to give Mr.
William E. Maloney a TV set ?
Mr. Crane. I was what ?
Mr. Kennedy. W^ere vou present when it was decided to give Mr.
William E. Maloney a TV set ? ^ ;
Mr. Crane. I was in the office. I was not present.
Mr. Kennedy. Was that taken up with the membership ?
Mr. Crane. Not to my knowledge.
Mr. Kennedy. That was $289.45.
How about the air conditioner here for $386 ?
Mr. Crane. Tliat is when I was in the office.
8292 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Who decided that ?
Mr. Crane. William E. Law.
Mr. Kennedy. Who is he ?
Mr. Crane. Past president.
Mr. Kennedy. Who appointed him ?
Mr. Crane. William E. Maloney.
Mr. I^NNEDY. Wlio decided on the TV set ?
Mr. Crane. I suppose Mr. Law did.
Mr. Kennedy. And got an encyclopedia. Were you in the oiRce
then?
Mr. Crane. That I don't know.
Mr. Kennedy. You don't know about the encyclopedia?
Mr. Crane. That might be a new one on me.
Mr. Kennedy. What about his convention expenses ?
Mr. Crane. In 1952 he received $2,000.
Mr. I^NNEDY. For what reason ?
Mr. Crane. As a delegate to the Seattle convention.
Mr. I^NNEDY. And he received it from local 105 ?
Mr. Crane. Local 150 as a delegate.
Mr. Kennedy. He was a delegate from 150 ?
Mr. Crane. That is right.
Mr. IvENNEDY. Was he elected by the membership ?
Mr. Crane. Not to my knowledge.
Mr. Kennedy. How did he become a delegate ?
Mr. Crane. Being a member of local 150, paid up member.
Mr. KJENNEDY. Did every paid up member of local 150 go as a dele-
gate?
Mr. Crane. It would be kind of hard to take everybody there.
Mr. Kennedy. How was he selected ?
Mr. Crane. He was appointed.
Mr. KJENNEDY. Who did ?
Mr. Crane. William E. Law.
Mr. Kennedy. And he had appointed William E. Law ?
Mr. Crane. That is right.
Mr. Kennedy. He got $2,000 ?
Mr. Crane. That is right.
Mr. Kennedy. Who gave him the $2,000 ?
Mr. Crane. William E. Law.
Mr. Kennedy. Did you know he also was paid as a delegate by the
international ?
Mr. Crane. I did not.
Mr. IvENNEDY. Received his expenses from the international?
Mr. Crane. I did not.
Mr. I^JENNEDY. For that same trip ?
Mr. Crane. I did not.
Mr. Kennedy. Did he receive any other delegate expenses other
than 1952?
Mr. Crane. 1956.
Mr. Kennedy. How much did he receive then ?
Mr. Crane. Five hundred, the same as all the rest of them got.
Mr. Kennedy. Was he a delegate ?
Mr. Crane. He was a delegate.
Mr. Kennedy. From local 150?
IMPROPER ACTIVITIES IN THE LABOR FIELD 8293
Mr. Crane. Local 150, being a paid up member and appointed.
Mr. Kennedy. By whom ?
Mr. Crane. Appointed by me.
Mr. Kennedy. xA.nd who appointed you ?
Mr. Crane. William E. Maloney.
Mr. Kennedy. $500.
Mr. Crane. $500.
Mr. Kennedy. AVliere was that convention ?
Mr. Ckane. Chicago.
Senator Mundt. How many delegates did 150 have to those con-
ventions, just the one or a group of them ?
Mr. Crane. A group.
Senator Mundt. How many ?
Mr. Crane. I think it was 12.
Senator Mundt. You appointed them all ?
Mr. Crane. That was in 1956.
Senator Mundt. You had 12 delegates in 1956 ?
Mr. Crane. That is right.
Senator Mundt. Did you appoint them all, or did you just appoint
Mr. Maloney ?
Mr. Crane. I appointed them all.
Senator Mundt. They all got the same amount of expense money ?
Mr. Crane. All got the same.
Senator Mundt. All got $500 apiece ?
Mr. Crane. All got $500 apiece.
Mr. Kennedy. Do you know Mr. William E. Maloney got expense
money from the mternational ?
Mr. Crane. I presume he got expense money, how much or what
he used it for I don't know. I don't know whether he got expense
money for going to the convention ; I wouldn't know that.
Mr. Kennedy. Have you taken any steps since you have been super-
visor to conduct a secret ballot to determine if the membership wants
to get out of trusteeship ?
Mr. Crane. If I understand you right, that motion was made on
the floor March 22, 1956, if that is the one you are referring to.
Mr. Kennedy. Yes.
Mr. Crane. I wrote a letter and signed it.
Mr. Kennedy. Was there a vote ?
Mr. Crane. There was a vote.
Mr. Kennedy. Against continuing the trusteeship ?
Mr. Crane. That is right.
Mr. Kennedy. Or for continuing ?
Mr. Crane. March 22, 1956.
Mr. Kennedy, Which was that for, for or against ?
Mr. Crane. That was against.
Mr. Kennedy. The next month they reversed their decision?
Mr. Crane. Yes.
Mr. Kennedy. Were you surprised that one month they voted to
get out of trusteeship and then you had a meeting next montli and
they were in favor of it ?
Mr. Crane. More or less I was.
Mr. Kennedy. It came as a complete surprise to you ?
8294 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Crane. I wouldn't say it was a complete surprise because I
heard rumors what was going on, on the outside, from the members.
Senator Mundt. Did you take any steps yourself to bring about
that reversal of opinion ?
Mr. Crane. No; I didn't.
Senator Mundt. You did not participate one way or the other?
Mr. Crais, e. I did not.
Senator Mundt. You did not do any campaigning or propa-
gandizing ?
Mr. Crane. No, sir.
Senator Goldwater. Mr. Crane, you mentioned that you had heard
of outside activities in relation to this change of vote. What were
those activities?
Mr. Crane. I don't know how to explain it, but it came to me by
word of mouth from outside members, from members, that a number
of them were going to come next meeting night. I said the more the
merrier. That is all.
Senator Goldwater. "\Yliat form of pressure was used ?
Mr. Crane. None that I know of.
Senator Goldwater. Did this activity encompass pressure to get
men to change tlieir vote or pressure to get more members there?
Mr. Crane. I dont understand your question.
Senator Goldwater. Did the outside activity include pressure on
those members who had voted to stop the way the meeting was being
run or was it outside activity to get more members at the next meet-
ing who were favorable to continuing?
Mr. Crane. That I wouldn't know. That would be up to the
members themselves.
Senator Goldwater. Did you hear anj^thing from the mem.bers
that would lead you to believe that they were receiving threats of
violence or economic threats if they did not change their vote?
Mr. Crane. No, sir ; never.
Senator Goldwater. How many people showed up at that next
meeting when the election was changed ?
Mr. Crane. I think at that time there was possibly 450 or maybe
500.
Senator Goldwater. Hoav many members do you have in that
local ?
Mr. Crane. We have around 7,600 at the present time.
Senator Goldwater. Was 450 an unusually large attendance?
Mr. Crane. Sir, first I had better go into it. We cover from Chi-
cago, 175 miles, possibly a little bit farther, to the east, 175 miles to
the west and from Wisconsin or the Michigan line we go about 175
miles south. So it would be hard for all members to get there.
Senator Goldwater. Was 450 an unusually large attendance ?
Mr, Crane. It had been running just about the same attendance.
We have a very good attendance there at our Chicago meeting.
Senator Goldwater. You get four to five hundred at each meeting
now?
Mr. Crane. I would say this is all the way from three to four or
five hundred there.
Senator Goldwater. How often do you meet ?
Mr. Crane. Once a month.
Senator M undt. How many attended the first meeting?
IMPROPEIR ACTniTIEi.S IN THE LABOR FIELD 8295
Mr. Ckane. I would say maybe 350, pretty close to it, maybe 400.
Senator Mundt. Eoughly the same size ?
Mr. Crane. Yes.
Senator Mundt. How did this come up? You presided at both
meetings.
Mr. Crane. I presided at both meetings.
Senator Mundt. At the first meeting did somebody get up and
make a speech and say tlie time has come to get out from under super-
visory control and I so move. Tell us what happened.
Mr. Crane. The gentleman that was sitting here before by the name
of Clarence Donat got up and made a motion — it was seconded. I
think it was by Mr. Donellin^ — to write a letter to petition the inter-
national to take us out from under supervision, which I did.
Senator Mundt. There was discussion both ways on it?
Mr. Crane. Sir?
Senator Mundt. Was there discussion on the floor both for and
against that motion?
Mr. Crane. You miglit say there was on the floor between the
members.
Senator Mundt. How did tliey vote, by show of hands or by
voice ?
Mr. Crane. By voice.
Senator Mundt. At the second meeting did different men get up
and make the motion or did tlie same men ?
Mr. Crane. A different man got up and made the motion.
Senator Mundt. At the meeting somebody got up and made a mo-
tion to change and reverse the earlier decision ?
Mr. Crane. That is right.
Senator Mundt. Did the (u-iginal movers of the motion at the
second meeting object to that?
Mr. Crane. Not to my knowledge.
Senator Mundt. You wer there ; you were presiding.
Mr. Crane. I Avould say no.
Senator Mundt. Did anybody get up and speak against it ^
Mr. Crane. No.
Senator Mundt. Were they given an opportunity ?
Mr. Crane. They had an opportunity to get up.
Senator Mundt. Did anyl^ody try to get up and try to be recognized
and maybe you did not see him and he did not get a chance to talk?
Mr. Crane. I wouldn't think so.
Senator Mundt. You are testifying that anybody who wanted to
protest at the second meeting had adequate opportunity and adequate
time to be heard, but nobody stood up to say, "We don't think we
ought to reverse our position."
Mr. Crane. I would say yes.
Senator Mundt. You say that is the way it happened ?
Mr. Crane. Yes.
Senator Mundt. And you again voted by voice ?
Mr. CiiiVNE. No, it was a rising vote.
Senator Mundt. Roughly how did they divide up? There were
400 there. How would you say they divided up for and against ?
Mr. Crane. I would say probably 8 to 12 of them stayed down; the
rest got up.
8296 I]MPROPE,R ACTrVITIES IN THE LABOR FIELD
Senator Muxdt. Did the people that voted "no" get up after a
while?
Mr. Crane. They had the opportunity to get up.
Senator Mundt. How many got up ?
Mr. Crane. None of them got up.
Senator Mundt. Did you say, "All those opposed now stand," and
nobody stood up?
Mr. Crane. That is right. That is to the best of my knowledge.
Senator Mundt. Some of them just sat down and did not get up?
Mr. Crane. I couldn't say that.
Senator Mundt. You were there.
Mr. Crane. I know I was there.
Senator Mundt. You do not know whether anybody got up and
said no ?
Mr. Crane. I could see nobody got up at that point.
Senator Mundt. How do you tell when you have a meeting in Chi-
cago of 400 men that you have got dues-paying members there ?
Mr. Crane. We have a guard at the door. He checks the books as
they come in. If he can't recognize them, then he will bring them
up to the Chair and they have to be recognized.
Senator Mundt. You would not know all Y,600 of them personally.
Mr. Crane. No.
Senator Mundt. So they must have a union card or something that
they show.
Mr. Crane. That is right.
Senator Mundt. Did you let the permittees vote ?
Mr. Crane. I don't think so. There has been an out-of-town book
come into Chicago. A fellow asked if he could come in but there was
no voting on the floor that night. That is the only time I know of
an out-of-town man being on the floor, I mean being among us. He
belonged to the International Union of Operating Engineers, a dif-
ferent local.
He asked if he could come in and sit in on the meeting.
Senator Goldwater. I wanted to follow up with one question. I
want to ask the counsel if this has been developed prior to this. If
so, I will not ask it.
Was this morning's witness asked what the vote was in the first
attempt to get out from under supervision ?
The Chairman. It was by voice vote.
Senator Goldwater. When it was by voice vote, was it evident to
you that there was quite a majority who were in favor of ending
supervision ?
Mr. Crane. I would say not. I explained it the best I could what
Mr. Donat's motion was and then I asked them to vote at that time.
Senator Goldwater. If you say it was close by a voice vote, it was
up to you to determine whether the ayes had it or the nays had it, is
that correct ?
Mr. Crane. That is right.
Senator Goldwater. In your judgment there were more there who
wanted it than who were opposed to it ?
Mr. Crane. That is right.
Senator Goldwater. You say there were about 400 in that first
meeting?
Mr. Crane. I would presume so, close to it.
IMPROPER ACTIVrriEiS IN THE LABOR FIELD 8297
Senator Goldwater. About 450 at the second meeting ?
Mr. Crane. That is right.
Senator Goldwater. How far apart were they ?
Mr. Crane. You mean the second meeting ?
Senator Goldwater. Yes.
Mr. Crane. A month apart.
Senator Goldwater. Wouldn't you suspect there was quite a bit
of pressure put on to change what in your opinion was a close vote in
favor of it to a unanimous vote against it in 1 month with only 50
additional members being present ?
Mr. Crane. I don't think anybody put any pressure on them what-
soever.
Senator Goldwater. They just thought about it themselves and
decided to remain ?
Mr. Crane. I presume so.
Senator Mundt. Mr. Crane, will you tell the committee, in your
own words, what your best guess is as to why they changed their
opinion ?
Mr. Crane. I couldn't guess at all, because there is no need of my
guessing. I think they have the authority, of their own mind, to
make up their own mind.
Senator Mundt. Nobody denies that. I was wondering, you being
the supervisor, being there, you must have some idea of what trans-
pired to make them change.
Mr. Crane. I wouldn't know. They were there at the next meeting.
That is all I know.
Senator Mundt. Do you think there was a different crowd at the
second meeting than the first ?
Mr. Crane. No, sir. There was quite a number of the first crowd
that was there.
Senator Mundt. Do you think somebody that voted "Yes" at the
first meeting, voted "No" at the second meeting?
Mr. Crane. That could be possible.
Senator Mundt. It was a great surprise to you ?
Mr. Crane. It was a surprise ; that is their privilege.
Senator Mundt. There is no question about that.
The Chairman. Do you think they should have the privilege of
electing their officers ?
Mr. Crane. Sir?
The Chairman. Speaking of this privilege, don't you think they
should have the privilege of electing their officers, too ?
Mr. Crane. You are asking my own candid opinion ?
The Chairman. Yes, sir; candid or otherwise. Let us start with
candid, though.
Mr. Crane. O. K. Truthfully, I think that the local should be
allowed to vote if they want it this way or that way. That is my
opinion.
The Chairman. Do you think they should be allowed to vote on
such items of expenditures as have been listed here today?
Mr. Crane. I truthfully think they should.
The Chairman. I do, too. Will you make every effort to see, here-
after, that such bills as these are presented to the members for their
approval ?
8298 IMPROPER ACTIVITIES IX THE LABOR FIELD
Mr. Nash. Senator, this is 150 ?
Mr. KJENNEDY. There are some bills for 150.
Mr. Crane. I can truthfully say at this time I have been watching
the bills pretty closely when they came in there. Even though there
was a car bought, we have put in over $1.1 million in the savings ac-
count, drawing 2 percent, and we are worth over $1.4 million at the
present time. I don't think I have been very loose with the members'
money.
The Chairmax. Of course, I don't know, except from what the
testimony has shown here, about the union being under trusteeship.
The men know nothing about what was going on, not having an
opportunity to vote, and the officers are perpetuated in there. Maloney
appoints a supervisor, and then he appoints somebody else, and they
make up their minds, in turn, to favor Maloney.
I asked the question, and I do not think you gave an answer, as to
whether you think a union composed of members such as this local
150 should have the right to elect their own officers periodically.
Mr. Crane. I will say at this time it is up to the members themselves.
The Chairman. We know it is not up to them now, because they
can't. You know that, too. They do not have any vote as long as
they are under supervisorship. Don't you think that men who pay
the dues and Avho do the work to support these officers and unions
should have the right to choose their own officers?
Mr. Crane. Truthfully speaking, I will say ''Yes."
The Chairman. Truthfully speaking, I agree with you.
Mr. Crane. That is my own opinion. I cannot go any further,
because that is up to the international. That is the reason I would like
for our members to be able to vote one way or another. There are a
lot of them that want it this way and a lot of them that want it that
way.
The Chairman. Would you like to see legislation compelling the
international to give them the right to vote ?
Mr. Crane. Yes, sir.
The Chairman. We are glad to have you favor that. Would you
like to see them have the right to vote by secret ballot?
Mr. Crane. Yes, sir ; that would be a vote.
The Chairman. That is splendid.
Mr. Kennedy. I take it, Mr. Crane, you have changed your mind
since July 31, 1957, about giving the members the right to vote?
Mr. Crane. That was when the letter was written, and he is asking
me now.
Mr. Kexnedy. Yes. Have you changed your mind since then ?
Mr. Craxe. Not since then.
Mr. Kennedy. You are in favor of giving the right to vote at the
present time, as I understand it.
Mr. Crane. At that time, I was in favor of being able to do whatever
they wished.
]Mr. IvEXNEDY. Let me read what you said.
Mr. Crane. I know what I said.
Mr. Ivennedy. Let me read it to you :
To subject this large local to periodic changes in the management of its af-
fairs by election of officers would not help the membership. It would bust it.
The operation of this large local is not small business to be taken care of after
working hours ; it is big business.
IMPROPER ACTIVITIEiS IX THE LABOR FIELD 8299
Mr. Crane, It is big business. It is very big business, in my opin-
ion.
Mr. Kennedy. And you were not in favor of having the local mem-
bers have the riglit to vote for their officers, because you did not want
a periodic change in the management.
Mr. Crane. If you want me to say something about that, I will.
The Chairman. You may elaborate.
Mr. Crane. There is a point, I might say, where I do not have to
spend my time electioneering.
The Chairman. That is quite an advantage to tlie officers, just to
perpetuate themselves without an election. Is that what you are
implying ?
Mr. Crane. That is right, and I believe, myself, in sincerity, that I
have done everything in my power to help these members in the agree-
ments. We have about 42 different agreements.
The Chairman. We are talking about the principles of democracy.
I do believe as a principle of democracy that the people of my State
ought to have a chance to pass on my stewardship occasionally. I do
not think I have the power to perpetuate myself because I personally
think I have done a good job. Do you ?
Mr. Crane. I could say something about some city that I know
about, but there is no need of my saying anj^thing about that.
The Chairman. Say anytliing you want to if you think it is per-
tinent. I v\'ill determine whether it is or not. I do not know what
your threat is or the implication of that statement.
Mr. Crane. I am not threatening anybody.
The Chairman. All right, proceed.
Mr. Crane. Then I withdraw that one.
The Chairman. All right.
Senator Goldwater. Because you bring up a rather valid argument
about the size of these large locals and the work that is entailed, and
your fear that breaking up the continuity of the management might
be harmful to the union, couldn't you solve that by hiring a business
manager and electing officers every year or 2 or 4 years, whatever you
decide, and then in order to guarantee the perpetuation of what ]ias
been done and what you want to do, to have a man who is paid by the
union to do just that type of work, just as a supervisor or negotiating
contracts or that sort of thing. Wouldn't that solve it ?
Mr. Crane. That could be possible.
Senator Goldwater. Then in a case like that there could be no
argument against an election being held at which the members could
elect their own officers like the president, vice president, secretary and
treasurer they wanted, but the business manager would be selected by
this elected group to carry on in perpetuity the management of the
union aifairs.
Mr. Crane. That would be possible.
(Members of the committee present at this point were Senators
McClellan, Mundt, and Goldwater.)
Senator Goldwater. That is the way it is done in business and we
never have trouble in a corporation, when they decide to elect a new
president or a new vice president, carrying on the atfairs of the busi-
ness. You could apply that to your organization. It would overcome
your objection, whicli has some merit to it.
8300 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Is there anything further ?
Mr. Kennedy. I wanted to ask you, when was the last time Mr.
Maloney spoke to you about Mr. S. A. Healy ?
Mr. Crane. Truthfully, I don't remember him ever speaking of
S. A. Healy.
Mr. KJENNEDY. He never spoke to you at all about S. A. Healy ?
Mr. Crane. No, sir.
Mr. IvENNEDY. Have you ever given any preferred treatment of any
kind to S. A. Healy?
Mr. Crane. I have not. He is treated just as fair as any other
contractor in our locality.
Mr. Ki:NNEDY. Have you ever notified any of the agents not to en-
force the contract on the S. A. Healy Co. ?
Mr. Crane. I have not.
Mr. Ivennedy. You have not ?
Mr. Crane. No, sir.
Mr. Kennedy. And S. A. Healy Co. is treated just like every other
contractor ?
Mr. Crane. To my knowledge.
Mr. I^NNEDY. And despite the testimony that has been given here
before this committee this morning, regarding the preferred treatment
that S. A. Healy has received
Mr. Crane. I have to say S. A. Healy gets the same treatment that
any other contractors do.
Mr. Kennedy. And you say that the statements of two witnesses
this morning are not correct, is that right ?
As far as you know S. A. Healy Co. does not receive any preferred
treatment.
Mr. Nash. Wliat do you mean by preferred treatment? You are
asking liim to make a statement contrary to what the witnesses testi-
fied to this morning.
The Chairman. Well, anybody knows what preferred treatment is.
You treat them different for some special reason than you treat all
others who come within the same category.
In other words, it is very simple. To use an illustration, contrac-
tors are under the same contract, and it provides they will pay a cer-
tain wage scale, and it provides that they will pay time and a half for
overtime.
As to one contractor, you enforce that provision against him, and
another one you favor him by not enforcing it. That would be pre-
ferred treatment. It is just that simple. There may be 100 other
illustrations just as applicable.
Mr. Crane. I say that what the gentleman brought up liere this
morning was an air compressor. There are a lot of places you could
find air compressors running, there are a lot of them. But we try to
keep them all covered as best we could.
As to overtime, in that agreement he is living right up to the over-
time.
Mr. Kennedy. Have you ever heard among members of local 150
that S. A. Healy is a preferred contractor?
Mr. Crane. No, sir ; this is the first time I heard it today.
Mr. Kennedy. It is the first time you ever heard it discussed ?
Mr. Crane. That is right.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8301
Mr. Kennedy. Are you going to take steps within your union to
try to restore the right of the members to select their own leaderehip ?
Mr. Crane. I will do the best I can.
Mr. Kennedy. When will you start taking some steps to do that ?
Mr. Crane. There might be a possibility we have already started.
Mr. Kennedy. There might be a possibility of it, but when will
you?
Mr. Crane. I don't know.
Mr. Kennedy. When you get back in Chicago ?
Mr. Crane. Not when I get back to Chicago. I can't do it that
quick.
Mr. Kennedy. Well, within a week of the time you get back?
Mr. Crane. It might be a week and it might be a month.
The Chairman. Will you start at the next meeting of the member-
ship?
Mr. Crane. Taking this out from under supervision is going to
have to be up to the international, and not me.
The Chairman. I did not say you could do it, but you can start
trying.
Mr. Crane. I have already started to do it.
The Chairman. When did you start?
Mr. Crane. When I wrote that letter on March 22, 1956.
The Chairman. Is that the last thing you have done about it?
Mr. Crane. That is the last thing I have done about it.
The Chairman. When will you make a fresh start ?
Mr. Crane. I have talked about it.
The Chairman. I would like for you to give a report to this com-
mittee within 30 days as to what action you have taken toward try-
ing to move in the direction of getting this union out of supervisor-
ship. Will you do that ?
Mr. Crane. I will do that.
Mr. Kennedy. In this letter of July 31, 1957, it certainly super-
sedes your letter of 1956, and in that letter you come out against
union democracy. You certainly have not been working toward re-
turning the union to its membership since 1957.
Mr. Crane. That is in the letter form.
The Chairman. Tlie witness is under obligation, in his sworn tes-
timony, to report to this committee within a month what action he
has taken and what action he has made to try to bring this union
out of supervisorship.
Is there anything f urtlier ? Is there anything else ?
The Chair has repeatedly said, and this will be a standing injunc-
tion against anyone taking any retaliatory action in the nature of
threats, coercion, or intimidation against any witness who has tes-
tified at these hearings. If such act is committed, witnesses who
liave testified are instructed to report it to the committee immedi-
ately, and as I have stated repeatedly, any such action in my judg-
ment would be an effort to obstruct the due processes of Government
and be in contempt of the United States Senate.
If this committee acts upon my recommendation and if they ap-
prove, we will undertake to have anyone cited who interferes with
the processes of this committee in trying to get factual information
21243 O— 58— pt. 20 25
8302 IMPROPER ACTIVITIES IN THE LABOR FIELD
and get sworn testimony concerning conditions that may prevail or
activities which may have occurred.
Let no one be under misapprehension about it.
Are there any further questions ?
Mr. Crane. May I say one thing? The gentleman over to my
right was sitting here, Mr. Charles Press, forgot to tell you that he
was a guard at the door at tlie meeting in Hammond up to about 2
months ago, and then lie retired from that.
The Chairman. What is that ?
Mr. Crane. He is a guard at tlie door of our meetings in Ham-
mond.
The Chairman. I imagine that is a legitimate function. I do not
understand what you mean.
Mr. Crane. He gave testimony that there were permit men coming
in, and how long they were coming in, I don't know, but evidently
they had to go through the guard.
Senator Mundt. Is he the only guard there ?
Mr. Crane. We have only one guard.
The Chairman. And one door?
Mr. Crane. We have two doors, and we can't shut the doors. We
can't shut the other one on account of tlie fire ordinance, and perhaps
Ave should have two guards.
Senator Mundt. Do you suppose his testimony was right, and he
was keeping them out of his door, but they were walking in the other
door? Is that possible?
Mr. Crane. I just wanted to make that statement, that he was the
guard or had been the guard at the ineetings.
Senator Mundt. The hypothesis that I set up would be possible,
too.
Mr. Crane. I don't think many members come through the other
door.
Senator Mundt. I don't know how many he says came in, but if
you have 2 doors and 1 guard, and 400 ])eople coming in the door,
that could be. I am not saying it is your fault or his fault, but it
is just one of the facts of life that 1 man cannot guard 2 doors, is
it not ?
Mr. Crane. That is right.
The Chairman. The witness may stand aside^ and the Chair wishes
to make a statement for the record.
The Chair announces that this afternoon session concludas tem-
porarily, at least, this series of hearings in the International ITnion
of Operating Engineers. I use the word "temporarily'' advisedly for
there are some contingencies that may make it necessary for this com-
mittee to reconvene and hold further public hearings with regard to
the Operating Engineers at a rattier early date. Certainly if and
when Mr. Maloney is able to testify, and able to appear, the committee
will require his ])resence to interrogate him regarding the disclosures
that have been made by the testimony.
During these hearings, we have endeavored, through a study of
local unions in widely scattered areas of the country and the inter-
national, to determine the conditions which affect the some 280,000
members who perform most vital work in our Nation today, not the
least of which is our $40 billion national highway program.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8303
The committee us well as the public, I think, has been shocked at
the disclosures of the last 2 weeks, such as :
1. The virtual lack of any democratic processes;
2. A dictatorial domination of the membership through violence,
threats, and deprivation of jobs;
8. Fixed elections; and,
4. P^nrichment of top officers in the union at the exj^ense of their
members.
It is rather hard to inuigine how democracy could be more stifled
than it is within the International Union of Operating Engineers.
Take the Long Island local, for example. It has been for a number
of years, and still is, a closed family corporation belonging practi-
cally lock, stock and barrel to the members of the DeKoning family
and their favored friends. Father DeKoning passed the union down
to Junior DeKoning somewhat in the same manner that a baron of
medieval days would pass his titles and privileges down to his sons.
"The fact that both of the DeKonings had been convicted of extor-
tion did not in the least concern or restrict them. They have domi-
nated, and DeKoning, Jr., continues to dominate, the union through
fear and violence. Out of a total of some 4,000 members, only 800
are allowed into the inner circle and can vote. These have been the
favorites of the DeKonings who are willing to do their bidding. It
would even appear that those in charge have gone to the extent of
framing memlDers of their own union in an effort to rid the union of
those who spoke out for honest unionism and better working con-
ditions.
The Newark local, No. 825, of the Operating Engineers, as the
testimony shows, was for many years the personal property of Joseph
S. Fay, a notorious extortionist who, according to the reports of New
York District Attorney Frank Hogan, exercised authority through
fear, intimidation, and threats.
The present business manager of the union, Peter Weber, not only
represents his members as a union official, but bargains with them as
the owner or part owner of a number of companies, some of which are
extremely lucrative. It would be like me sitting down making a con-
tract with myself, so I w^ould profit both ways. That is wdiat it
amounts to. His business interests which employ Operating Engi-
neers are a clear conflict of interest.
The final effrontery in local 825 came when Joseph S. Fay was
rewarded, and I use the word "rewarded'' w ith emphasis, for selling
out his members by being given the equivalent of $2(58,000 in union
dues money for his legal defense, a lifetime pension, and a salary to
his wife while he was serving in the penitentiary.
Now let us turn to another local.
Again, in the San Francisco local, it has been established that the
officers, Victor S. Swanson, Patrick Clancy, P. E. Vandewark and
Clarence Mathews, ran the union as if it were their own personal
business.
They milked thousands of dollars out of the union treasury and put
it in their own pockets. Before the committee they admitted these
depredations of union dues money and it is quite significant to note
that the only conflict between their testimony was and is who ended
up with the pilfered funds. Each claimed that the other got them.
8304 IMPROPER ACTIVITIES IN THE LABOR FIEI.D
In this 24,000-man union the dues-paying members were never told
just what was being done with their money. That holds true with all
of the other locals that we have inquired into during this series of
hearings. Even the secret ballot of the members was not sacred to
these men.
You will recall that these officers admitted, without any apparent
remorse whatsoever, that they had taken 2,000 votes to a mountain
cabin, counted some 500 of them, destroyed the ballots, and then
awarded some 17,000 votes to their favored candidates. They ex-
plained that this was all right because everybody else in the inter-
national was doing the same thing.
Incidentally, I understand, and the press may check on this, that
when Mr. (^lancy and Mr. Vandewark and Mr. MatheAvs returned to
San Francisco after their testimony here, they were handed a resig-
nation which they signed.
The use of international supervision, and we frequently refer to
that as trusteeships, to keep local unions enslaved is the rule rather
than the exception in the International Union of Operating Engi-
neers. The committee heard testimony how a Philadelphia local was
kept under supervision — the equivalent of trusteeship in other
unions — for almost 18 years while the members were not allowed to
vote or have any say in the affairs of their own local. Those who
dared to suggest that this was an undemocratic procedure were beaten
and threatened.
Wliile under the trusteeship of Joseph S. Fay, the evidence conclu-
sively shows that the union was looted of millions of dollars. After
4 years of democratic rule by the union's own members, this union
was again thrown back into trusteeship. One of those now running
the union is a man who is under indictment for extortion in the State
of Pennsylvania.
William E. Maloney, the international president of the Interna-
tional Union of Operating Engineers, has kept two Chicago locals
in trusteeship for nearly 30 years while his appointed stooges looted
these locals and passed part of this loot on to Maloney himself. The
evidence shows that Maloney had thousands of dollars paid for his
personal expenses such as new cars and television sets, and air-
conditioning units, and various other things.
Other officers, including a vice president of the international,
charged the union for fancy liquors, the stuffing of birds, and other
equally exotic expenses, from the funds of one of these supervised
locals.
Not content with looting these captive locals, Maloney also milked
the international by the submission of double and in some instances
triple expenses which went a long ways toward making Maloney the
wealthy man he is today with homes in Chicago and Miami, a fully
equipped luxury yacht, and a furnished apartment in AVashington,
D. C, at the union's expense. He now maintains 10 and possibly 11
safety deposit boxes, in banks and other financial institutions, the con-
tents of which he is unwilling to reveal. I imagine a lot of dues-paying
members would like to see the inside of those boxes, and I think the
Internal Revenue Department would also like to see those boxes, and
I just wondering if they are listening. I hope they find a way to
move quickly.
IMPROPER ACTIVITIES IN THE LABOR FIELD 8305
You know we are going to need some money to finance this defense
program, and we ought to collect these bank accounts.
Through all of these years, Maloney maintained a close association
with out of the Nation's biggest contractors, Stephen A. Healy, and
evidence before the committee indicates that Healy's firm received
favored treatment from the International Union of Operating Engi-
neers.
In appearance before the committee during this series of hearings,
Mr. Healy took the fifth amendment and refused to tell anything about
his financial dealings with Maloney or to explain to the committee
the disposition of some $228,000 in funds written off' on his books, the
books of his company, as a nondeductible business expense, and I think
it was shown pretty conclusively that every dollar of this money, after
it was taken out, immediately went to Mr. Healy himself, and from
there he made disposition of it.
A sordid picture has been presented to this committee on how Ma-
loney, through his association with mobsters and racketeers grabbed
control of the International ITnion of Operating Engineers and has
since ruthlessly maintained this control. It is quite significant that
some of his opposition were murdered, ganglancl style, in the streets
of Chicago.
These hearings, I am sure, will have a salutary effect not only on the
thinking of this committee with regard to remedial legislation which
the Congress must enact to protect the working men and women of
America, at least as it relates to the International Union of Operat-
ing Engineers and some others, but I think it may have, and I hope it
will have, a salutory effect throughout the country and it will alert
more keenly than ever the rank and file members of these unions to
a situation where they are being exploited and imposed on. I am sure
if they will have the courage to act, or enough of them will have, they
can begin to correct many of these things at the local level.
It certainly appears, from the sordid and disturbing record made
here, that these members have been abused, vilified, and rebuffed, often
violently, in their many efforts to bring a little democracy into the
procedures of their unions. Only 46 percent of the members of the
international can even vote for their union leadership. I am per-
suaded that a very substantial number of that 46 percent dare not
exercise their own free volition and will in the votes that they cast.
The American people and this Government cannot, and will not
long, tolerate such dictatorship and the attitude of mind which puts
thousands of working men and women into servitude. It is the duty
of the Congress to act promptly, and I mean at this session of Con-
gress, and enact legislation to deal with this deplorable and unwhole-
some situation,
I think the public should know, and I wish they could know in its
full and true ramifications and to the full extent of the facts, that
hearings such as these, making such revelations as are made in the
public hearings of this committee, could not possibly be successful and
the adequate preparation could not be made, and these facts of mis-
conduct and improper practices obtained, except that this committee
has been fortunate in assembling a staff of Hill-trained, industrious,
loyal, and dedicated personnel.
21243 O— 58— pt. 20 26
8306 IMPROPER ACTIVITIES IN THE LABOR FIELD
The chairman would like to thank and to extend the appreciation
of the committee to those men from the United States General Ac-
counting Office in Chicago, New York, Cleveland, Ohio, Washington,
D. C, and San Francisco, Calif., who have contributed their efforts
and their labor toward the success of this investigation. Those men
are : Mr. Jack Balaban, who testified here ; Mr. Marshall Gould, Mr.
John Prinos, Mr. Robert Cofini, Mr. Harry Moran, Mr. Theodore
Simon, Mr. William Paton, Mr. Paul Riebesel, Mr. Laurence Major-
ossy, Mr. William Braunlin, Mr. Joseph Y. Gordon, and Mr. Charles
Smith.
I certainly wish to commend the regular members of the staff of this
committee who worked on this case, beginning with our chief counsel,
Mr. Kennedy, and his assistant counsel, and also to Mr. Calabrese,
Mr. Adlerman, Mr. Mundie, and Mr. Pierre Salinger, and also to the
clerical personnel of the staff who have worked many long hours on a
tedious task in helping us to prepare this for presentation and making
it a record for all to see, to read, and to understand and upon which
they can pass judgment.
Our thanks to all of them, and the committee stands adjourned
subject to the call of the Chair.
(Whereupon, at 4 : 05 p. m., the committee recessed, subject to the
call of the Chair. )
APPENDIX
Exhibit No. 79A
8307
8308 IMPROPER ACTIVITIES IN THE LABOR FIEI.D
Exhibit No. 79B
IMPROPER ACTIVITIES IN THE LABOR FIELD 8309
Exhibit No. 80
AMlI-RACrSlSEniMC. RESOLUTION
Submitted to the 25th Convention of the International Union of
Operating Englneers-AFL-CIO - April 9, 1056 - Chlcar^o, 111.
V/IIERdlAS scores of highly reputable newspapers and other
well known publications throughout the United ::'-ate3 hrr/e been,
for a long period of tine, publlshin;: tcccvnt" of v;;*lfare funi
looting, ralsapproplation of union funds, aocrot deals and
arrein£,er.ien'vS affQcti-.c collective barcaining apree lents to the
detritnG.it of our union nornbers interests, undemocratic and un-
Amorican union ad.-ninlstratlve practices; all reportedly engaged
in by officials of our International Union and/or its subordinate
branches; and
'..T'^lll^S such practices, If perr.iitted to exist and co.»tlnue,
would deprive sick and disabled vnenbers and their fa:r:iliGs of a
substantial poi-tlon oT v/elfare plan benefits which they \/ould
otherwise receive; deprive renders of the control and benefit of
xinlon treasury fiinds v;hich are in fact their property; deny to
nenibers the benefit of war.es and conditions of eT.ploynent
provided for in effective collective bergaininfj contracts;
deprive members of a proper voice and participation in the
administration of affairs of their respective Local Unions and
the International Union; and
CTIEREAS this nation-wide publicity has brought our entire
union into disrepute and fastened an undeserved stigma on
hundreds of thousands of decent and honorable craftsmen who
make up the membership of our union; therefore be it
RESOLX'ED that the Attorney General of the United States be
formally requested and urged to im-nediately institute a full
scale investigation of our International union and its subordinate
branches for the purpose of determining whether:
(a) Adminiotrative practices of union officials are
such as to deprive our ..ler.ibers of their Civil nights.
(b) Union treasury funds are belnc inproperly or unlaw-
fully diverted and used for purposes not spocifisally
authorized by our nenbership.
(c) '.Volfaro funds, PonsiOA fimds, etc. are being adulnls-
terod In a lawful and proper manner consistent v/ith
the best interests of our. moribershlp.
(d) Our union members ars being deprived of any rlr:ht3,
priviloros, or Imnunitlos granted all American
Citizens by the Constitution of the United States.
(e) Federal Antl -Racketeering Statutes are being, or
have been, violated by any person or persona within
our International Union or any of Its suboMlnate
branches. {
Respectfully submitted by:
Colurabo Acchlone
Local Union 542-542-A-B
Philadelphia, Pennsylw
8310 IMPROPER ACTlVrXIES IN THE LABOR FIELD
Exhibit No. 84
I]VIPRiOPER ACTIVITIES IN THE LABOR FIELD
Exhibit No. 85
8311
8312 IMPROPER ACTIVITIES IN THE LABOR FIEI^D
Exhibit No. 86
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8314 IMPROPER ACTIVITIEiS IN THE LABOR FIEILD
Exhibit No. 88
IMPROPER ACTIVITIES IN THE LABOR FIELD 8315
Exhibit No. 89
8316 IMPROPER ACTIVITIEiS IN THE LABOR FIE^LD
Exhibit No. 100
EXPENSE ACCOUNT .^i^.teo ,.„ ,* #.^,j.. tec^at.on or l«or no B 1 SS9
JlntPruatuufciU*ll«ian*nf,t0pprattiig Snntnrrrs
•O- • • ift03 t? ^tp'eet northwest
••J ,*, **/3^SHIn55*TOI>I» D C ,9__ 1
PiVY TO THE ORDER OF *-! * « ! .* • • • • * S ' .
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fv.;*-- ' jiuhn-natinnal llntnii nf (nprrntinn -Euaitiprrs "° B ISSH
'■P/fcr-c pay '" . . v'^ .
r/»f sum oj
/ y
IMPR£)PER ACTIVITIES IN THE LABOR FIELD 8317
TOWN
STATEMENT
^ L STATE :
DATE /->
.^7
international Winiow of (Operating engineers
To ^
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From, ,
190// , To . _^
Salary. 6 Days at per Day
Expenses: Hotel Bill. R. R. Fare and Incidentals as follows:
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NOTE^In
this blank.
order to receive attention, your accounts must be rendered WEEKLY and on
Six (6) days' salary per week ONLY will be allowed. -41^467
8318 IMPROPER ACTIVITIES IN THE LABOR FIELD
Exhibit No. 101
IMPROPER ACTIVITIES IN THE LABOR FIELD
Exhibit No. 102
8319
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8320 IMPROPER ACTIVITIES IK THE LABOR FIEILD
Exhibit No. Ill
Sv EXPENSE ACCOUNT Am^lVtO Wl^^ TMt^MyiCAN FC0«R*TI0N of UIBOR NO. B 6643
mi^ ^^ 3ntprnaltiuurt IWi^^ ^ ®pprattng SttgtnpprB ~^"
loea K «i»RB£-» Northwest
•\*«£HlNCiTttN. J3. C. MARCH 31 19 ^
ORDER oF__cAgfet:'<}Ap^Liij> gCssMPBTiXpc: « ^on.S'^
FIVE THOUSAND ThTrTSEN AND*6'S/iOO' *" dollars
; *'*, Jnjrrnatlanal ifnion of (Sprrating EnstnrrrB
LIBERTY NATIONAL BANK
WASHINGTON. D. C.
0Lco<J6ux.
fc
Genwral S«er«t»rj-Tr*a««r«r
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&= £ i
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TO THE
N SECURI
FOR 01
GAINLLAC
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Trfjfr.rtr 0/ Jlntpmatinital Inion nf ©prraling Sngiitppra n° B 6643
1003 K STREET. NORTHWEST. WASHINGTON. D C
^'lca«' pax to CiPITaX^ !|LLAC OLDRVOBILE CO. ■^5013.65
The
sum oj
i-ilL Iciiy:iAlii} ThIJTTlEK
ihiu b5/1iX)
Dollars
h
t952 CADILLAC CaR LESS 200.00 DEPOSIT
5013-65
IMPROPER ACTIVITIES IN THE LABOR FIELD
8321
8322 IMPROPER ACTIVITIES IN THE LABOR FIELD
Exhibit No. 112
7138
r;-c^iX^ 3nlrrnatimiai Uninit of (9|iprafiuii SmjuipprB 15-94
W^ -^^ "**" "•^'"- '''^'^ sVreeY northwest 5"
I ,t. i WASHINGTON D C • -^ 19,.2j
PAY TO THE ORDER OF
- sT-ti^Jw-*
Liberty national ban
washington. d c
c. « § i
i? i "
^ -^ £ I ^•
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K.E.Aft DETACH Bcrom PWatMTiMO CfacK
Treasurer of 3ntrntatinual llutnu nf ODprratinu Snniurrr>i < 1 ^^^
1 us 17TM STREET N W . WASHINGTON. D. C
Tlease pay to : " ^ v.; c . $ .
The sum of
for
i< 1
^'¥p iMP^^iAL y
Dollarsl
IMPROPER ACTIVITIES IN THE LABOR FIELD 8323
mi DE COZEN EAST ORANGE CO
^^lijjf 531-3 3 CENTRAC AVE.
EAST ORANGE. N. J.
Telephone OR*Not 47901
8082 3
SOLO TO
1- . -
DATB ■- , . ' V
CASH
Notes
Traoc
House
8324
IMPROPER ACTIVITIES IN THE LABOR FIELD
Exhibit No. 113
RABHrS APPLIANCE & FURNITURE CO. "^
1«AHS| ^g/B T«i«vition . R«fri9«r«tort WKtB i sg»viCi[
Atftwnatie WmNm • V«euwn CtMum • Irenwt • G«ctrk KHdMnt - Horn* httmt
COMPLETE UNi Of CLiCTfUCAL AffUANCiS
PImm SlwfMd 222 ^^.^^^^^ ,^r..^^^ 124 SUty %
HAMMOND. INDIANA
y ^^/3
Addrtss
ixfsy^^lt
T* ' CASH I <J7^/^ CMAKW i ON ACCT IMOSf RETO i P*iD OUT !j "
, ^ 1 i : i
No. 20955 geceved
IMPROPER ACTIVITIES IX THE K\BOR FIEI.D
8325
- TaV : i THt OHDER OP
MERCAHTILt KATIOWl UHt
of Himmond, lafl.
.CABINS APPwlANC.
jM06 HOHMAN 4VCNUf
' • J1AMMK)ND. W|IANA
1>
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I:...:
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8326 IMPROPER ACTIVITIES IN THE LABOR FIELD
Exhibit No. 114
/<»
I ^RABirS APItJANCe S FURNmis CO.
[swyicij
ItAllll VHP *-«-^ * Pafrlnaftnra
COMHiTi Um Of iLiCTMCAL AffUAMCR
Pl«» SMM at ^^, ^. 124 Sy«y Sk
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AU dam and HMumwt eoMb
No. 29016 ite»iv«i by
H#nws-\/fHM
IMPROPF.n ACIIVITIKS IX THK LABOR FIELD
8327
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