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Full text of "Investigation of improper activities in the labor or management field. Hearings before the Select Committee on Improper Activities in the Labor or Management Field"

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INVESTIGATION OF IMPROPER ACTIVITIES IN THE 
LABOR OR MANAGEMENT FIELD 



HEARINGS 

BEFORE THE 

SELECT COMMITTEE 

ON IMPEOPER ACTIVITIES IN THE 

LABOE OE MANAGEMENT EIELD 

EIGHTY-SIXTH CONGRESS 

FIRST SESSION 

PURSUANT TO SENATE RESOLUTIONS 74 AND 221, 85TH 
CONGRESS, AND SENATE RESOLUTION 44, 86TH CONGRESS 



JANUARY 27, 28, 29, AND FEBRUARY 3, 1059 



PART 43 



Printed for the use of the Select Committee on Improper ActiTities In the 
Labor or Management Field 




INVESTIGATION OF IMPROPER ACTIVITIES IN THE 
LABOR OR MANAGEMENT FIELD 



HEARINGS 

BEFORE THE 

SELECT COMMITTEE 

ON IMPROPER ACTIVITIES IN THE 

LABOR OR MANAGEMENT EIELD 

EIGHTY-SIXTH CONGRESS 

FIRST SESSION 

PURSUANT TO SENATE RESOLUTIONS 74 AND 221, 85TH 
CONGRESS, AND SENATE RESOLUTION 44, 86TH CONGRESS 



JANUARY 27, 28, 29, AND FEBRUARY 3, 1959 



PART 43 



Printed for the use of the Select Committee on Improper Activities in the 
Labor or Management Field 




UNITED STATES 
GOVERNMENT PRINTING OFFICE 
36751 WASHINGTON : 1959 



n 



Boston Public Library- 
Superintendent of Documents 

APR 2 - 1959 
DEPOSITORY 



SELECT COMMITTEE ON IMPROPER ACTIVITIES IN THE LABOR 
OR MANAGEMENT FIELD 

JOHN L. McCLELLAN, Arkansas, Chairman. 
KARL E. MUNDT, South Dakota, Vice Chairman 
JOHN F. KENNEDY, Massachusetts BARRY GOLDWATER, Arizona 

SAM J. ERVIN, JE., North Carolina CARL T. CURTIS, Nebraska 

FRANK CHURCH, Idaho HOMER E. CAPEHART, Indiana 

Robert F. Kennedy, Chief Counsel 
Rdth Yodng Watt, Chief Clerk 

n 



CONTENTS 



James R. Hoffa and the International Brotherhood op Teamsters 

Appendix _ _ _ ^**^* 

Statement of— 16179 

Allder, Harrv Clifford.. ,-^^^ 

Shenker, MoVris A }';?947 

Testimony of— 1^949 

Cunningham, John R _ ifiioq 

Si:^l^ii!:^"or,,;::::;::::------"----''*'°''"^ 

Goodman, Seymour '^anna la^Xl 

Healy, Daniel J 1^006, 16074 

Herman, Moss jf??? 

Hutner, Herbert :^^-- J^^^J 

Lucas, Martha ^^^' J^n^J 

Maher, Joseph F zz^t.- 1o07o 

McMaster, Rolland '^961, 5971 

McShane, James J. P. ^^^^' J^nlo 

Peters, Donald ^anhy"^a^ni i^V^o 

Rumminger, William J....' ^^^^^' 1^103, 6108 

Shulman, Theodore... |2Taa 

Sinclair, Richard G... j^JXo 

Tierney. Paul J }6102 

wSe' Donlld'"' ^ 159§7,-i6526,-i653§,"i6058.-i6567, leJoQ 

, 16152 

EXHIBITS 

211 A. Letter dated December 2. 1958, addressed to Senate 

Select Committee on Improper Activities in the introduced Anne 
Labor or Management Field, from Dr. Charles on pag?"" l^a 

-,,„ ^ Silverberg. re Richard Kavner 150=0 r*^ 

211B. Letter dated November 20, 1958. addre"sse"d To Senate ^ ^ 

belect Committee on Improper-Labor Management 
Activities, from Dr. David Feldman. re Richard 

Kavner _ ir:Qco /*% 

211c. Report of U.S. Public HealtY "s'eVvice" "eVamlnatTon of ^ ^ 

Richard Kavner ifiot^o f*\ 

21 ID. Letter dated January a'Tgsg.' add7e;sed"to"s"enaie ^ ^ 

feelect Committee on Improper Activities in the 
Labor or Management Field, signed by Dr. Aaron 

_,,^ Birenbaum re Pete Saffo 1=0=0 /*v 

21 IE. Letter dated January 9, 1959, addressed" to' SeJi ate ^ 

belect Committee on Improper Labor-Management 
9111? T^.. '"'i^'f •/'■?™ ^'■- Edward J. Berger. re Pete SaflFo.. 15952 (*) 
21 IF. Letter dated January 9, 1959, addressed to Senate ^ 

belect Committee on Improper Labor-Management 
91 1 r T? Activities from Dr. Arthur E. Strauss, re Pete Saffo. . 15952 (*) 
211G. Report of I. S. Public Health Service e.xamination of ^^ ^ ^ 

Pete SaflFo jgg-2 (*) 

•May be found In the files of the select committee. 

m 



ars 



IV 



CONTENTS 



212. Thirty-four checks which represent money paid out by introduced 

William Rumminger in purchase of an agreement on page 
with Holland McMaster during 1955, 1956, 1957 15959 

213. Certificate — Conducting Business under an Assumed 

Name, pursant to Michigan statute, for M. & G. 
Trucking, signed by Rolland McMaster, dated 
December 28, 1949 15962 

214. Signature card from The Detroit Bank, Detroit, 

Mich., on the account of M. & G. Trucking Co., 
authorizing Yvonne McMaster and Mary Alice 

Chenier to sign checks 15962 

215A. Articles of incorporation of Ram Transport, Inc 15984 

215B. Articles of incorporation of Enterprise Equipment & 

Leasing Co 1 5984 

215C. 1953 annual report of Reed Transportation Co 15984 

216. Fifteen letters dated from March 1948 through March 

1949, from Joseph M. Jacobs to Dr. Leo Perlman 

and from Dr. Perlman to Mr. Jacobs 15990 

217. Eight letters dated from April 27, 1949, through August 

1, 1952, relating to the award of insurance for local 

1031, IBEW 15992 

218. Documents referring to Central States Conference of 

Teamsters and their welfare fund and insurance 16000 

219. Documents referring to Michigan Conference of Team- 

sters, and correspondence between Dr. Perlman and 
James R. Hoffa and the Dorfman group as to handling 
insurance 16003 

220. A book "Whose Welfare?," a report on union and em- 

ployer welfare plans in New York, published by the 
Insurance Department of the State of New York 16007 

221. A book "Private Employee Benefit Plans — A Public 

Trust." a report on welfare and pension funds in 

New York State 16007 

222A. Code of ethical practices with respect to the insuring of 
benefits of union or union-management welfare and 
pension funds 16008 

222B. Illustrative commission scales to accompany the above 

code of ethical practices 16008 

223. Check No. 1501, dated March 11, 1957, payable to 

Mount Vernon Life Insurance Co. of New York, in 
the amount of $39,155.35. signed by Allen M. Dorf- 
man 16022 

223A. Check No. 1502 dated June 21, 1957, payable to Mount 
Vernon Life Insurance Co., in the amount of $12,- 
306.31, signed by Allen M. Dorfman 16022 

223B. Letter dated December 9, 1957, addressed to William 
Smith, secretary-treasurer. Mount Vernon Life 
Insurance Co. from Morry Rapaport, assistant to the 
president, the Exchange National Bank of Chicago.. 16022 

223C. Credit slip of the Exchange National Bank of Chicago 
showing credit of $12,306.31 to the account of Mount 
Vernon Life Insurance Co 16022 

224. Memorandum dated April 8, 1952, to Dr. Perlman from 

Mr. Smith — subject Michigan Conference renewal- . 16031 
224A. Letter dated April 8, 1952, addressed to Dr. Leo Perl- 
man, Union Casualty Co., signed by Frank E. Fitz- 
simmons, trustee, Michigan Conference of Teamsters 

welfare fund 16031 

224B. Memorandum dated April 10, 1952, to Dr. Perlman 
from Mr. Smith — subject Michigan Conference of 
Teamsters 16038 

225. Letters from Dr. Perlman to James Hoffa from Dr. 

Perlman to Allen Dorfman, from Dr. Perlman to 

James R. Hoffa 16041 

*May> be found in the files of the select committee. 



Appearr 
on page 

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16179 

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(*) 

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16180 
16181 

16182 

16183 

(*) 

(*) 
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CONTENTS 



226. Letter dated April 8, 1952, addressed to Dr. Leo Perl- 

man from SaTiiuel Schwartz, Michigan Conference of introduced Appears 
Teamsters Welfare Fund, re Michigan Conference of on page on page 
Teamsters 16042 16184 

227. A group of 153 checks 16053 (*) 

228. Report dated October 30, 1958, Northeastern Life Insur- 

ance Co. of New York, with covering letter dated 
November 14, 1958, from David Previant of Padw'ay, 
Goldberg & Previant 16072 (*) 

229A. Invoice No. 3303 dated April 15, 1956, from Lucas Co. 

to Aldor Insurance Agency, in the amount of $1,000. 16077 16185 

229B. Invoice No. 3305 dated November 8, 1956, from Lucas 
Co. to Aldor Insurance Agency, in the amount of 
$1,000 16077 16186 

229C. Invoice No. 3352 dated February 11, 1957, from Lucas 
Co. to Aldor Insurance Agency, in the amount of 
$1,950.79 16077 16187 

229D. Invoice No. 3300, dated April 22, 1956, from Lucas Co. 

to Union Insurance Co. in the amount of $500 16077 16188 

229E. Invoice No. 3302, dated May 10, 1956, from Lucas Co. 

to Union Insurance Co., in the amount of $1,000.-- 16077 16189 

229F. Invoice No. 3304, dated November 11, 1956, from Lucas 

Co. to Union Insurance Co., in the amount of $1,000- 16077 16190 

229G. Invoice No. 3354, dated February 6, 1957, from Lucas 
Co. to Union Insurance Co., in the amount of 
$850.12 16077 16191 

230. Check No. 3480, dated March 20, 1958, payable to 

American Airlines, Inc., in the amount of $866.38, 
drawn by Warehouse and Mail Order Employees 
Local No. 743, Chicago 16100 16192 

231. Hotel bill from the Castaways, Miami Beach, in the 

name of Don Peters, Chicago, 111., from February 

13 to February 16, 1958 16101 (*) 

232. Hotel bill from the Castaways, Miami Beach, dated 

February 10, 1958, in the name of Paul Dorfman 

and Allen Dorfman 16102 (*) 

233. Delta Airlines, Inc., transportation receipt and invoice 

No. 28747, dated February 3, 1958, round trip, Mid- 
way to Miami and return, in the amount of $221.32. 16103 16193 

234. Check No. 3403, dated March 7, 1958, payable to 

Harold Rvan, in the amount of $600, drawn by local 

743, Chicago 16103 16194 

235. Bill from Erie Cafe, dated March 25, 1958, in the 

amount of $196.60 and check No. 25, dated April 1, 
1958, pavable to Erie Cafe, in the amount of $196.60 
drawn by local 743, Chicago 16104 16195- 

236. Check No. 2123 dated November 5, 1957, payable to 16196 

Fontainebleau Hotel Corp., in the amount of 
$4,289.89, drawn by local 743, Chicago, together 
with statement dated September 30, 1957, to local 
union No. 743, attention: Stephen S. Jarolin, secre- 
tarv-treasurer the James HoflFa Dinner: "Your share 
(One third of $12,869.65)" 16105 16197- 

237. Check No. 2735, dated December 14, 1956, payable to . 16198 

cash, in the amount of $1,150 drawn by local 743, 

Chicago 16106 16199 

238. Check No. 2817, dated January 3, 1957, payable to 

Hygrade Food Products Corp., in the amount of 

$1,901.34, drawn by local 743, Chicago 16106 16200 

239. Hotel Saxony bill No. D 11383 rendered to 608 Union 

Insurance Agency of Illinois and paid by Allen Dorf- 
man's partnership in the amount of $2,142.96 with 
an erasure on line 24 16107 (*) 

•Ma;^ be found in the files of the select committee. 



VI 



CONTENTS 



239 A. Original Hotel Saxony bill No. D 11838 rendered to introduced 
Union Insurance Agency of Illinois, in the amount of on page 
$2,142.96 16109 

240. Two memoranda, one dated November 8, 1951, and 

one dated November 16, 1951, on Waste Trade 
Industry of Chicago stationery, signed by Ted Shul- 
man, executive director, and also by Edward Lissner, 
president 16112 

241. Memoranda, one dated January 15, 1953, and one 

dated November 2, 1953, on Waste Trade Industry 
of Chicago stationery, signed by Ted Shulman, execu- 
tive director, and Edward Lissner, president 161 13 

242. Check No. 1230, dated October 19, 1954, payable to 

Larry Lera, in the amount of $200 drawn by Waste 

Trade Industry of Chicago _ 16114 

242 A. Check No. 1204, dated January 21, 1954, payable to 
Ross Miller in the amount of $386 and drawn by 
Waste Trade Industry of Chicago 16114 

243. Photograph of six men, Ted Shulman, Paul Dorfman, 

Lou Gordon, Bernie Nemerov, Ross Miller, and 

Harry Serlin 16115 

244. Photograph of three men, Shulman, Miller, and 

Dorfman 16117 

245. Application for boxer's license, State Athletic Com- 

mission of Illinois 16117 

246. Check No. 3134, dated October 6, 1957, payable to 

Fontainebleau Hotel Corp., in the amount of $414.11, 

drawn by Sanatex Corp., Chicago, 111 16119 

246A. Two Hotel Fontainebleau bills Nos. 79228 and 79229 
in tlie name of Abe Levin and Norman Greene, total- 
ing $414.11 16119 

247. Statement of John R. Cunningham, member of local 

584, Milk Wagon Drivers Union, New York 16126 

248. Hotel Woodner bills for the period December 2 through 

December 7, 1958, for "Moss Herman and One"; also 
December 11 through December 16, 1958 for "Moss 

Herman and One" 15152 

Proceedings of — 

Januarv 27, 1959 15947 

January 28, 1959 16017 

January 29, 1959 16081 

February 3, 1959 16123 

*May be found in the files of the select committee. 



Appears 
on page 



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16201 



16202 



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INVESTIGATION OF IMPROPER ACTIVITIES IN THE 
LABOR OR MANAGEMENT FIELD 



TUESDAY, JANUARY 27, 1959 

U.S. Senate, 
Select Committee on Improper Activities, 

IN THE Labor or Management Field, 

Washington^ D.O. 

The select committee met at 10 a.m., pursuant to call, in the caucus 
room. Senate Office Building, Senator John L. McClellan (chairman 
of the select committee) presiding. 

Present : Senator John L. McClellan, Democrat, Arkansas ; Senator 
Sam J. Ervin, Jr., Democrat, North Carolina ; Senator Frank Church, 
Democrat, Idaho; Senator Karl E. Mundt, Republican, South Da- 
kota; Senator Carl T. Curtis, Republican, Nebraska. Also present: 
Robert F. Kennedy, chief counsel ; Pierre E. G. Salinger, investigator ; 
Joseph F. Maher, investigator; Martin S. Uhlmann, investigator; 
John P. Findlay, 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 : Senators McClellan and Curtis.) 

The Chairman. The Chair may make a very brief statement that 
the purpose of the hearings scheduled for today is to hear some wit- 
nesses whom the committee desired to hear in a previous investigation 
and during a previous series of public hearings. 

They were not available at the time. In some instances they were 
ill, unable to attend in response to the committee's request or to a sub- 
pena. We are trying to pick up these loose ends in the next 2 or 3 
days and complete the record in the matter of hearings that we have 
previously conducted, insofar as these witnesses' testimony may sup- 
plement and complete it. 

Mr. Kenndy, you may call your first witness. 

Mr. Kennedy, Mr. Barney Baker, Mr. Chairman. Mr. Baker's 
attorney is here. 

The Chairman. Let counsel come forward. Mr. Counsel, have a 
seat. Counsel, identify yourself for the record, please. 

STATEMENT OF HARRY CirETORD ALLDER 

Mr. Allder. My name is Harry Clifford Allder, a member of the 
Bar of Wasliington, D.C. 

I received a communication, Mr. Chairman, from Mr. George Fitz- 
gerald, who represents Mr. Baker, to the effect that Mr. Baker is in a 
hospital in Chicago, 111., the Augustana Hospital, 411 West Dickens, 

15947 



15948 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Chicago, 111., telephone number Diversey 8-1000. His doctor is Dr. 
Joe Brown, 100 West North Avenue, Chicago^ 111. 

He stated further that the doctor had said that he was unable at 
this time to respond to this committee. 

The Chairman. Do you have a cerificate or anything, a document to 
file with the committee ? 

Mr. Allder. I do not, sir. This is a telephone communication to 
me of late yesterday. 

The Chairman. Mr. Fitzgerald requested that you appear before 
the committee and give that information; is that correct? 

Mr. Allder. Yes, sir ; he did. 

The Chairman. Mr. Counsel, what have you with respect to this 
witness ? 

Mr. KJENNEDY. Mr. Chairman, as you remember, Mr. Baker was to 
be called a morning last year, and went to the hospital the morning 
that he was to appear. So we were imable to call him at that time. 

The Chairman. Mr. Baker did have a heart attack at that time, 
did he not? 

Mr. Kennedy. He went to the hospital, Mr. Chairman. 

The Chairman. Did you get any medical record or certificate at 
that time with respect to his ailment ? 

Mr. Kennedy. We have had, Mr. Chairman, several conflicting re- 
ports on the extent of his illness while he was in the hospital here in 
Washington, D.C. I can say no further on that matter at this time. 

We subpenaed him again to appear before the committee today, 
and within several days of his receiving that subpena of the notice to 
appear here, he went back into the hospital in Chicago. We were 
going to make attempts to have him examined by a Government doc- 
tor, but that cannot be done in the hospital, so he is remaining in the 
hospital and we are unable to make any further examination of him 
to determine whether he would be in shape to come and testify. 

The Chairman. Well, there is no doctor's certificate before the com- 
mittee. What are the prospects of getting a certificate from his 
attending physician with respect to his condition? 

Mr. Allder. I am sure one can be gotten pretty quickly, Mr. Chair- 
man. I will see to it that it is furnished the committee. 

The Chairman. All right. Have a certificate for us here tomor- 
row morning. You can do it by telephone, I am sure. 

Mr. Allder. Yes, sir. 

The Chairman. Have it here tomorrow morning at 10 :30 when the 
committee reconvenes. 

In the meantime, Mr, Counsel, any information that you can get 
with respect to his condition, let us have it. The committee certainly 
wouldn't want to impose upon any witness who is ill, and whose 
physical condition is such that he shouldn't be required to appear in 
a public hearing. We don't want to do any injustice or impose on one 
who, by all rights, should not be required to testify. 

At the same time, the committee must guard against imposition 
against it, as well. Counsel, of course, I can understand your posi- 
tion, when you are called and asked to give this information. But 
certainly counsel for the witness knows that the proper procedure is 
to provide this committee with a certificate from a doctor, the physi- 
cian, stating the witness' condition. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15949 

Counsel, may I inquire how long the witness has been notified that 
his presence was desired here today ? 

Mr. KJENNEDY. He was notified approximately 2 weeks ago, Mr. 
Chairman, and as I understand it, at least from the report we received, 
he entered the hospital about 10 days ago in Chicago, 111. 

The Chairman. We will await the certificate of the physician to- 
morrow morning and we will weigh the matter further at that time. 

Mr. ICennedy. Do you know who his attending physician is ? 

Mr. Allder. Dr. Joe Brown, 100 West North Avenue, Chicago. 

The Chairman. Thank you very much. 

I understood chief counsel to say we couldn't have anyone on be- 
half of the committee examine him while he is in the hospital. "What 
is the reason for that ? I do not understand that. 

Mr. Kennedy. We do it through the Public Health Service, Mr. 
Chairman, and the Public Health Service will not examine in the 
hospital. 

The Chairman. If it becomes necessary, we can arrange for some 
other physician ? 

Mr. Kennedy. Yes. 

The Chairman. Call the next witness. 

Mr. Kennedy. I would like to have the attorney for Mr. Dick Rav- 
ner and Mr. Pete Saffo give his report to the committee. Mr. Chair- 
man, we also called Mr. Richard Kavner, who is an official of the 
Teamsters Union under Mr. Harold Gibbons, and Mr. Pete Saffo, 
who is also an official of the Teamsters Union under Mr. Harold 
Gibbons. 

Both of these individuals who were expected to testify last year 
pleaded illness. We called them again for today and we have re- 
ceived some information that they are unable to appear. 

The Chairman. Counsel, you may be seated. Identify yourself 
for the record. 

STATEMENT OF MORRIS A. SHENKER 

Mr. Shenker. My name is Morris A. Shenker. I am a lawyer, 
licensed to practice law in the State of Missouri and in Federal 
courts. 

With respect to the situation of Mr. Richard Kavner, on December 
2, and thereafter, this committee was advised that medical histories 
were forwarded to this committee, and a request was made that if the 
committee desires, an examination of Mr. Kavner be had by a physi- 
cian designated by this committee. 

On last Saturday, I believe it was the 23d of January, such an 
examination was made. We have conferred with the doctors, with 
our doctors. The Public Health physicians could not give us the in- 
formation, as they are precluded from furnishing the information to 
us, but they will only furnish that to the committee. 

But it is established from the doctors that treated Mr. Kavner that 
he is suffering from severe attacks of paroxysmal tachycardia, and he 
is under the care of Dr. Charles Silverberg, of the city of St. Louis, 
and Dr. David Feldman, of the city of St. Louis, both of whom con- 
cur in the opinion that Mr. Kavner is subject, in view of the repeated 
history of a sudden — well, whenever he is under emotional strain, he 
is subject to attacks which consist of a sudden loss of consciousness 



15950 IMPROPER ACTIVITIES IN THE LABOR FIELD 

followed by severe sweating and pain of his extremities, and also show- 
ing the swelling of some parts of his body, and that it increases the- 
heart; he has a rapid heart action, with the rate of about 220 per 
minute; that they reached a conclusion that it would be extremely 
dangerous for him, with very serious consequences, in the event he was 
to submit to questioning. 

That is the reason, Mr. Chairman, that Mr. Kavner is not available- 
to testify. 

The Chaieman. Is he in a hospital ? 

Mr. Shenker. No, sir. 

The Chairman. Has he been in a hosiptal ? 

Mr. Shenker. Yes, sir. The last time, according to my record, that 
he was in a hospital was in November of 1958. 

The Chairman. For what period of time ? 

Mr. Shenker. I will only approximate it. I don't have the exact 
dates. But I believe it was for about 2 weeks. 

The Chairman. I think that was along about the time the commit- 
tee was trying to have him testify. 

Mr. Shenker. I am not familiar with that, excepting that this 
is not the only time that Mr. Kavner was in a hospital. He has been 
sick since 1957. He has been suffering with this affliction, and sub- 
jected to these attacks ever since 1957. 

The Chairman. Does he do any work ? 

Mr. Shenker. Yes, sir ; of a limited nature. 

The Chairman. What kind of work does he do ? 

Mr. Shenker. Well, generally as assisant to Mr. Gibbons. 

The Chairman. He works for Mr. Gibbons as assistant to him with- 
out impairing his health ? 

Mr. Shenker. I say the doctors, in fact, recommend that some work 
be done, but they seem to be of the opinion, and so are most people, 
that work for Mr. Gibbons is considerably different than testifying 
before this committee is. 

The Chairman. Mr. Chief Counsel, do you have information re- 
garding this witness ? 

Mr. Kennedy. I will correct my statement that I made earlier about 
the fact we wanted him in November. We had wanted him in Sep- 
tember of last year. But we did have a Public Health Service doctor 
examine Mr. Kavner, Mr. Chairman, and he stated that it might en- 
danger him to testify before the committee. 

The Chairman. I don't care what any doctor says. If, a man is 
able to work and carry on his business, I have serious doubt that he is 
in such a condition that he couldn't come and testify before a com- 
mittee. I just cannot nuderstand that a man could carry on his nor- 
mal work, engage in an occupation of that character, and tlien when 
testimony is needed from him he is too ill to testify. 

Mr. Kennedy. He had his picture, I believe, in the November or 
December edition of the Teamster magazine, as somebody who had 
performed services here in Washington and attended meetings. I 
know he has been in Puerto Rico on Teamster business. So he has 
been extremely active in Teamster business from what we can tell. 

Senator Curtis. Does the Teamsters Union carry hospital, medical, 
and surgical insurance on this man ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15951 

Mr. Shenker. I am sure they are covered under the LHI, which 
covers them the same as any other employee. But on the other hand, 
for any examinations outside, or any hospitalization outside of the 
confines of their policy, of course, they have to pay for those them- 
selves. 

For instance, I know that the doctor that attended the examination, 
in conjunction with the Public Health doctor, that he was chargin, 
them directly, because that is not a part of the Teamsters Union a; 
fairs. That is, it isn't covered by the Labor Health Institute. 

Mr. Kennedy. That is all, Mr. Chairman. 

The Chairman. The committee will take this particular case under 
further consideration. Do you have the documents ? 

Mr. Shenker. These are copies of what we forwarded to the Chief 
Counsel for the committee. 

The Chairman. Do you have them? 

Mr. Ivennedy. I believe we do. 

Mr, Shenker. I will be glad to file them, if you need them, but 
they are only copies. 

The Chairman. These documents may be filed for the record as 
exhibits and designated accordingly as exhibits for the committee's 
consideration in connection with this case. 

Do we have "a written report also from the Government doctor? 

Mr. Kennedy. It is on its way, Mr. Chairman. 

The Chairman. Wlien it is received, it will also be made an ex- 
hibit for the record. 

Senator Curtis. Has the Public Health doctor or anyone else ascer- 
tained whether or not Mr. Kavner could give testimony in a nonpub- 
lic hearing ? In other words, in an executive session ? 

(At this point Senator Mundt entered the hearing room.) 

The Chairman. I don't know whether they make any distinction 
or not between a public hearing and an executive session. Do they ? 

Mr. Kennedy. I don't believe they do, Mr. Chairman. 

The Chairman. I don't think any distinction is made. 

Is there anything further ? 

Mr. Kennedy. Mr. Pete Saffo. 

Mr. Shenker. "With reference to Mr. Saffo, the situation as to him 
is the following: That Mr. Saffo was hospitalized insofar as major 
operations are concerned the first time, as I can note from this record, 
in October of 1947, and that he was hospitalized again in 1953, and 
then in March of 1958 he was admitted to the hospital in St. Louis 
for treatment of a coronary thrombosis. During his stay at that hos- 
pital he was treated by Dr. Birenbaum and Dr. Arthur Strauss. 

He was discharged from the hospital on April 9, which means he 
remained there approximately 5 weeks. Then he was again read- 
mitted to the Jewish Hospital in St. Louis on June 18, 1958, for chest 
Sains. He was again treated by the same doctor in consultation with 
>r. Strauss, and the opinion and conclusion that was reached was 
that he suffered further heart damage. 

He was discharged from the hospital on July 5th, and has been 
under the care of the doctors since that time. During the entire 
period and since that time, he has been advised to be very cautious 
about his activities. He has been only participating in a very limited 
extent in his activities. In other words, he only works about, I would 



15952 IMPROPER ACTIVITIES IX THE LABOR FIELD 

say, not over 2 to 3 hours a day, and in doing so the advice of the 
doctors has been to avoid all possible excitement and any tensions. 

The doctors in the examinations of him, they are keeping him under 
constant supervision, they are of the opinion that any unusual strain 
or stress or excitement might be fatal to Mr. Saffo. 

The diagnosis of Mr. Saffo wliich was made by Dr. Strauss orig- 
inally, in consultation with Dr. Birenbaum, was that he had an 
acute coronary thrombosis, with a myocardial infarction, and the 
same conclusion, substantially, was reached after that. 

The Chairman. What is the date of that certificate ? 

Mr. Shenker. This is written on January 9, 1959, and the original 
was forwarded to the committee. In fact, letters by the doctors are 
addressed to the committee. 

Pursuant to our request made of the chief counsel of the committee, 
an examination was made by the Public Health doctors in conjunc- 
tion with one of the doctors that is attending Mr. Saffo, on the 23d 
of this month, and the findings, I understand, were forwarded to the 
chief counsel of your committee. 

The conclusion that is reached — I might read just that paragraph. 
This is written by Dr. Aaron Birenbaum : 

It is my professional opinion that any type of tension could precipitate an- 
other coronary thrombosis. I have, therefore, advised Mr. Saffo that because 
of the tension involved and his previous cardiac damage, his appearance before 
your committee would place his life in jeopardy. 

That is the letter that Dr. Aaron Birenbaum, a heart specialist, 
wrote to your committee. 

The Chairman, These documents may be made an exhibit for 
consideration by the committee. I will state that these two cases 
will be considered further. It may well be that the witnesses should 
not be required to appear before the committee. 

Mr. Shenker. May I also respectfully request that the examinations 
made by the Public Health doctor, when you receive those written 
reports, that they also be made part of the exhibits in the Saffo case? 

The Chairman. The Chair intended to include all of the docu- 
ments referred to. 

Mr. Shenker. Very well. 

The Chairman. They will be made exihibits Nos. 211A, 211B, 
211C, 211D, 211E, 211F, and 211G and that will be true with respect 
to the documents submitted regarding Richard Kavner. 

(At this point Senator Ervin entered the hearing room.) 

(The documents referred to were marked "Exhibits Nos. 211A, 
211B, 211C, 211D, 211E, 211F, and 211G, for reference and may be 
found in the files of the Select Committee.) 

The Chairman. The fact that some one has had a heart attack 
at some time does not mean that someone should be excused from 
testifying. We have a President of tlie United States who has suf- 
fered a time or two and also a leader in the U.S. Senate. They cer- 
tainly carried on their duties and certainly these people should be 
required to give testimony if that is the only reason to he considered. 

Frankly, I think a lot of these folks just don't want to testify. That 
is the truth about it. 

Now, they may be able to come within some legal rule that will 
permit them to escape, but I am not going to treat these matters 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15953 

lightly. I am going into them sufficiently to satisfy myself, and 
satisfy this committee at least, that there is some real justification for 
them being excused. 

Is there anything further ? 

If not, you may stand aside. Call the next witness. 

Mr. Kennedy. Mr. Rolland McMaster, Mr. Chairman. 

The Chairman. Come forward, Mr. McMaster. 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 
nothing but the truth, so help you God ? 

Mr. McMaster. I do. 

TESTIMONY OF ROLLAND McMASTER, ACCOMPANIED BY 
COUNSEL, HARRY CLIFFORD ALLDER 

The Chairman. State your name, your place of residence, and your 
business or occupation, please, sir. 

Mr. McMaster. My name is Rolland McMaster. 

I would like to ask, Mr. Chairman, if I could get my attorney, who 
is supposed to be here, but he stepped outside. 

The Chairman. Yes ; you may. We will suspend for just a moment. 

Mr. McMaster. Thank you. 

Mr. Chairman, I would like to apologize for the situation I am in, 
but I do have an attorney and he was here with me some time ago. 
Right now I can't find him. 

The Chairman. Let us have order. 

Mr. McMaster. I would like the pleasure of postponing this until 
I find him. 

The Chairman. The question was to state your name, your place 
of residence, and your business or occupation. 

When we hear your answer to the question, the Chair will 

Mr. Kennedy. Here he is. 

(Counsel Allder entered the hearing room and accompanied Mr. 
McMaster.) 

The Chairman. Is this your counsel ? 

Mr. McMaster. Yes. 

The Chairman. The question, Mr. McMaster, is : State your name, 
your place of residence, and your business or occupation. 

Mr. McMaster. My name is Rolland McMaster. I live at 52030 
Pontiac Trail. 

The Chairman. Wliat is your business or occupation ? 

Mr. McMaster. Mr. Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

The Chairman. You honestly believe that if you stated what your 
business or occupation is, that a truthful answer to that question might 
tend to incriminate you? Is that what I understand you to say? 

Mr. McMaster. I respectfullv decline, your Honor, Mr. Chairman, 
to answer because I honestly believe my answer might tend to in- 
criminate me. 

The Chairman. Just a moment. The Chair was trying to clarify 
or clear up what j^ou said before. 

Read the question back to the witness, the last question, please. 

(The question of the chairman was read by the reporter.) 



15954 IMPROPER ACTIVITIES IN THE LABOR FIELD 

(The witness conferred with his counsel.) 

Mr. McMaster. Yes. 

The Chairman. Proceed, Mr. Kennedy. 

Mr. Kennedy. Mr. McMaster, as I understand it, axjcording to our 
records, you are a business agent for local 299 of the International 
Brotherhood of Teamsters. 

Mr. McMaster. Mr. Kennedy, I respectfully decline to answer be- 
cause I honestly believe my answer might tend to incriminate me. 

Mr. Ej:nnedy. And according to our information you have been 
connected with that local since approximately 1940 ; is that right? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kxnnedt. You have been with local 299 since 1940, with the 
exception of 3 years that you were in the Armed Forces; is that 
right, Mr. McMaster? 

Mr. McMaster. Mr. Kennedy, I respectfully decline to answer be- 
cause I honestly believe my answer might tend to incriminate me. 

Mr. KENNEDY. In addition to receiving the income and expenses 
that you received from local 299 of the Teamsters, you also have in- 
terest in various trucking companies in and aromid the Detroit area? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Could you tell the committee how you obtained the 
interest in those trucking companies ? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Mr. Chairman, could we call several witnesses re- 

farding Mr. McMaster's activities in this area, and then recall Mr. 
fcMaster at a later time, later on this morning, to ask more detailed 
questions about these matters ? 

The Chairman. Mr. McMaster, I think the committee has sub- 
stantial information that it can develop in the course of testimony 
before it. Do you want us to develop that testimony and give you a 
chance to know exactly what the committee has with respect to your 
activities before you answer questions ? 

(The witness conferred with his counsel.) 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Mr. Counsel, proceed to put on the other witnesses. 

Mr. McMaster, you may remain present. You may take the seat 
behind you. You will remain present and hear this testimony because 
you will be interrogated about it as to whether it is correct, after it is 
put on the record. 

Call the next witness. 

Mr. Kennedy. Mr. Chairman, we think that this matter is of ex- 
treme importance, because there has been discussion over the past 
year and a half as to the good contracts that some of the Teamster 
Union officials are able to obtain for their members. 

But as we are aware, and as the testimony has been developed here, 
it is not just a question of good written contract: it is a question of 
the enforcement of the contract if Teamster Union officials liave inter- 
ests in trucking companies that operate not only in the Miohig;in area 
but all over the country. This particular witness, it will be shown, 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15955 

has interests in truckino- companies that operate in the Michigan area. 
As tlie liearings go on, and as we developed in the past, there are Team- 
ster officials who have interests in trucking companies that go through 
most of the midsection of the country. It is a question of whether 
these union officials can truly enforce the contract where they, them- 
selve.s, have a personal financial interest, and where they do business 
with comj)anies that have contracts with the Teamsters. 

The Chaikman. Call the first witness. 

Mr. Kennedy. Mr. William J. Kumminger. 

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. Kumminger. I do. 

TESTIMONY OF WILLIAM J. RUMMINGER 

The Chairman. State your name, your residence, and your business 
or occupation, please, sir. 

Mr. RuMMiNGER. William Rumminger, 1990 Humphrey, Birming- 
ham, Mich. I am a salesman for Douglas Trucking Lines. 

The Chairman. Is that located in Detroit, Mich. ? 

Mr. Rumminger. Detroit, yes. 

The Chairman. Do you waive counsel, Mr. Rumminger ? 

Mr. Rumminger. I beg your pardon ? 

The Chairman. You waive counsel, do you ? 

Mr. Rumminger. Yes. 

The Chairman. All right, Mr. Kennedy, proceed. 

Mr. Kennedy. Mr. Rumminger, you had an interest in the Aero 
Cartage Co. ? 

Mr. Rumminger. Yes, sir. 

Mr. Kennedy. And you obtained that interest in approximately 
1953; is that right? 

Mr. Rumminger. That is right. 

Mr. Kennedy. What business did the Aero Cartage Co. do ? 

Mr. Rumminger. It was nothing but a sales company in the Detroit 
area, hauling for Douglas Trucking. 

The Chairman. Doing what? 

Mr. Rumminger. Hauling steel for Douglas Trucking. 

Mr. Kennedy. The Aero Cartage Co. did not actually haul the steel 
itself, did it? 

Mr. Rumminger. That is right, they did not. 

Mr. Kennedy. They went out and tried to get business, is that 
right, for the Douglas Trucking Co. ? 

Mr. Rumminger. That is right. 

]Mr. Kennedy. And you owned the Aero Cartage Co. ? 

Mr. Rumminger. Yes, sir. 

Mr. Kennedy. And you received a certain commission on the busi- 
ness that you were able to get for the Douglas Trucking Co. ? 

Mr. Rumminger. That is right. 

Mr. Kennedy. Was it a successful company during 1953 and 1954? 

Mr. Rumminger. Business was bad, yes. 

Mr. Kennedy. It was very bad ? 

Mr. Rumminger. Yes. 



15956 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. "Was one of the accounts that you had the McLouth 
Steel Corp. ? 

Mr. KuMMiNGER. Yes. 

Mr. Kennedy. Where are they located? 

Mr. RuMMiNGER. In Detroit. 

Mr. Kennedy. Had you received much business from them ? 

Mr. Rumminger. I had received business, yes. 

Mr. Kennedy. A very small amount of business, is that correct, a 
very minor amount of business ? 

Mr. Rumminger. The company weis new and it takes a while. 

Mr. Kennedy. You had only received a very minor amount of 
business up to 1955 ? 

Mr. Rumminger. Yes. 

Mr. Kennedy. In 1955 were you approached by Mr. RoUand Mc- 
Master in connection with your business ? 

Mr. Rumminger. Business in general, yes. 

Mr. Kennedy. Rolland McMaster at that time you knew to be a 
business agent of the Teamsters Union ? 

Mr. Rumminger. That is right. 

Mr. Kennedy. Was he a business agent that handled the employees 
for the McLouth Trucking Co. ? 

Mr. Rumminger. That I do not know. 

Mr. Kennedy. Was he the business agent for the employees of the 
Douglas Trucking Co ? 

Mr. Rumminger. Yes. 

Mr. Kennedy. Did he make any statements to you as to the fact 
that he could help you in your business ? 

Mr. Rumminger. He did make the statement that he might enable 
me to get more trucklines in my office so as to share my expense and 
he would help me whenever he could, yes, putting in a good word. 

Mr. Kennedy. That he would try to get some trucking companies 
to move their place of business into your office ? 

Mr. Rumminger. To share my expense, yes. 

Mr. Kennedy. Did he also state that he thought he might be able 
to help you with the McLouth Steel Corp ? 

Mr. Rumminger. I had mentioned several accounts that I could be 
helped in, yes. 

Mr. Kennedy. I don't understand that answer. Did he also make 
a statement to you that he could help you with the McLouth Steel Co. 
Corp? 

Mr. Rumminger. There was no mention by him of that McLouth, no. 

Mr. Kennedy. There was no mention by him ? 

Mr. Rumminger. Not specifically, no. 

Mr. Kennedy. He did not mention McLouth Steel Corp ? 

Mr. Rumminger. I mentioned McLouth, yes. 

Mr. Kennedy. Did he say he could help you with McLouth ? 

Mr. Rumminger. He said he would put in a good word for me at 
Mcl^outli, yes. 

Mr. Kennedy. Was he able to help you at McLouth? 

Mr. Rumminger. The business has been good, yes. 

Mr. Kennedy. What financial arrangements did you make with 
him at that time? 

Mr. Rumminger. My setup was strictly on a percentage basis. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15957 

Mr. Kennedy. "What financial arrangements did you make with 
Mr. McMaster at that time? 

Mr. RuMMiNGER. It was more or less on a partnership basis. I 
split my personal net profit with him, which was 3 percent, on the 
McLouth business. 

Mr. Kennedy. You gave him 3 percent of all the business that he 
could obtain for you from McLouth ; is that right? 

Mr. RuMMiNGER. Yes. 

Mr. Kennedy. And did you begin to make payments then to him 
starting in 1955, after this conversation ? 

Mr. RuMMiNGER. Yes. 

Mr. Kennedy. Did your business with McLouth Steel Corp. increase 
after that? 

Mr. RuMMiNGER. I didn't get the question, sir. 

Mr. Kennedy. Did your business with the McLouth Steel Corp. in- 
crease after that, after this conversation ? 

Mr. RuMMiNGER. Yes. 

Mr. Kennedy. And then did you begin making payments to Mr. 
McMaster? 

Mr. RuMMiNGER. I made all payments to M. & G. Trucking. 

Mr, Kennedy. Wliat was the M. & G. Truicking Co. ? 

Mr. RuMMiNGER. That I do not know. 

Mr. Kennedy. Was that the company that Mr. McMaster told you 
you should make the checks out to ? 

Mr. RuMMiNGER. Yes. 

The Chairman. Who is Mr. McMaster that you were dealing with 
at that time ? 

Mr. RuMMiNGER. Who was he ? 

The Chairman. Yes. What did he represent? What was his 
business ? 

Mr. Rumminger. The Teamsters Union. 

The Chairman. In what capacity ? 

Mr. Rumminger. Business agent. 

The Chairman. Business agent for what Teamsters local? 

Mr. Rumminger. 299. 

The Chairman. For 299 ? 

Mr. Rumminger. Yes, sir. 

The Chairman. So you were paying commissions to a Teamster 
or business agent of the Teamster local to help you get business ? 

Mr. RuiviMiNGER. I paid all my commissions to M. & G. Cartage. 

The Chairman. Who are they ? 

Mr. Rumminger. That I don't know. It is a cartage company. 

The Chairman. Is that who directed you to pay them to? 

Mr. Rumminger. That is right. 

The Chairman. Did you ever find out who M. & G. Trucking 
Co. is? 

Mr. Rumminger. No, sir, I haven't. 

The Chairman. Were you interested in knowing ? 

Mr. Rumminger. No, sir. 

The Chairman. "Why? Wouldn't you like to know who you are 
doing business with, who you are paying out money to ? 

Mr. Rumminger. I never checked that, sir. 

36751— 59— pt. 43 2 



15958 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. I beg your pardon ? 

Mr. RinviMiNGER. I never check it, sir. 

The Chairman. I asked you if you are not a little interested in 
knowing who you are paying out your money to, who you are doing 
business with. 

Mr. RuMMiNGER. Well, the business had increased. I felt no need 
to check any further. 

The Chairman. No need to check any further ? 

Mr. RuMMiNGER. That is right. 

The Chairman. The wliole idea of making this arrangement with 
the business agent of the Teamsters local was to get an increase in 
business ? 

Mr. EuMMiNGER. That is right. 

The Chairman. And you did not care who got the profit? You 
did not care who got the money you were paying out ? 

Mr. RuMMiNGER. Well, I felt M. & G., whoever that was, made 
their profit, yes. 

The Chairman. What did they have to do with making a profit? 
Did you ever have any business dealings with M. & G. other than 
issuing these checks ? 

Mr. Rumminger. No, I haven't. 

The Chairman. Did you ever talk with anybody who represented 
M.&G. Trucking Co.? 

Mr. Rumminger. No, sir. 

The Chairman. Did you ever meet anybody or know anybody who 
was identified with such a company ? 

Mr. Rumminger. No, sir. 

The Chairman. So you just made checks to them at the direction 
of this business agent of the local ? 

Mr. Rumminger. That is right. 

The Chairman. And who did you have an understanding with you 
were to pay the 3 percent to ? 

Mr. Rumminger. Mr. McMaster. 

The Chairman. Who was to get that money ? 

Mr. Rumminger. I beg your pardon ? 

The Chairman. Who was to get that money when you had that 
understanding ? 

Mr. Rumminger. M. & G. Cartage. 

The Chairman. Did you inquire who M. & G. Cartage Co. was at 
that time ? 

Mr. Rumminger. No, sir, I did not. 

The Chairman. The truth is that you knew this money was to go 
to McMaster, did you not ? 

Mr. Rumminger. I knew it was McMaster. 

The Chairman, You knew it was to go to him, did you not? 

Mr. Rumminger. Who was in the company I never inquired, I never 
checked. 

The Chairman. You just made this arrangement with the business 
agent of the local in order to get the business ? 

Mr. Rumminger. That is right. 

The Chairman. Could you identify the checks that you gave over 
a period of time to the trucking company ? 

Mr. Rumminger. Yes, sir. Those are my checks. 



IMPROPER ACTIYITIES IN THE LABOR FIELD 15959 

The Chairman. Is M. & G. Trucking Co. and the M. & G. Cartage 
Co. one and the same ? 

Mr. RuMMiNGER. Yes, sir. 

The Chairman. When you are speaking of one you are speaking of 
the other as well ? 

Mr. IIu:mminger. That was a mistake on my part in making out the 
check, sir. 

The Chairman. As far as you know these checks, whetlier made to 
M. & G. Trucking Co. or M. & G. Cartage Co., all went to the same 
party ? 

Mr. Rumminger. Yes, sir. Mr. McMaster's name never appeared 
on the back. 

The Chairman. What? 

Mr. Rumminger. Mr. iMc]Master never did sign any of the checks 
on the back. 

The Chairman. He never did sign any ? 

Mr. Rumminger. No, sir. 

Mr. Kennedy. Mr. Chairman, we have the certificate from the State 
of Michigan, county of Wayne, in connection with M. & G. Trucking 
Co., which indicates that it was owned and controlled by Mr. Mc- 
Master. 

Senator Mundt. Mr. Chairman, before we leave the checks, I won- 
der if we can find out whose name did appear on the backs. 

The Chairman. I am going to introduce them. 

I have here a number of checks, probably 30 or 40 checks. With- 
out identifying each one, I will present them to you in bulk and ask 
you to examine them. They can be counted as to the nmnber. Iden- 
tify these checks and state what they are and what they are for. 

(Documents handed to the witness.) 

The Chairman. Let the record show the Chair has presented to 
the witness at this point a blank number of checks. The exact num- 
ber can be ascertained and the record shall speak accordingly. 

Mr. Rumminger. Yes, sir. 

The Chairman. Those are the checks you paid out in pursuance of 
your agreement with Mr. McMaster ? 

Mr. Rumminger. That is right. 

The Chairman. They were over a period of 1955, 1956, and 1957? 

Mr. Rumminger. That is right. 

The Chairman. These checks may be made, in bulk, exliibit No. 212. 

(The checks referred to were marked "Exhibit No. 212" for refer- 
ence and may be found in the files of the select committee.) 

The Chairman. Do you know whether these are all of the checks 
that you paid ? 

]Mr. Rumminger. Yes, sir, that is aU of the checks I paid. 

The Chairman. That is all that you have? 

Mr. Rumminger. Yes, sir. 

The Chairman. Do you Imow what the total amount is you paid 
out dm-ing the 3-year period of time in this fashion ? 

Mr. Rumminger. No, sir, I don't. The figures are 

The Chairman. I think it aggregates some $19,711.07, according 
to the accountants of the comnnttee. Would that be approximately 
correct, in your judgment ? 

Mr. Rumminger. Yes, sir. 



15960 IMPROPER ACTrvrriES est the labor field 

The Chairman. And what was this paid out for ? 

Mr. KuMMiNGER. That was for half of my commissions. 

The Chairman. Half of your commissions ? 

Mr. RuMMiNGER. The 3 percent, yes. 

The Chairman. That was actually paid out to someone designated, 
this cartage company or trucking company, designated by this business 
agent of local 299 ? 

Mr. Rummingki:. That is right. 

The Chairman. And that was to get business? 

Mr. Rumminger. To get business and also to bring in other busi- 
ness to share my office, which I never did get, but there was other 
trucklines to come in. 

The Chairman. In other words, you already had this account but 
you were not getting enough of the business ? 

Mr. Rumminger. That is right. 

The Chairman. And there was this one account that he operated on 
to get you more business from that account ? 

Mr. Rumminger. Yes, sir. 

The Chairman. And he was to bring in others ; is that right ? 

Mr, Rumminger. There is no mention made of any definite accounts 
at all. It was more or less on like a partnership arrangement where 
he would bring in whatever he could to help share my expenses. 

Senator Mundt. All of these checks seem to be signed M & G 
Cartage Co. in pen and ink, underneath the name, Mary Alice 
Chenier. 

Do you know who Mary Alice Chenier is ? 

Mr. Rumminger. No sir; I don't. 

Senator Mundt. You do not know ? 

Mr. Rumminger. No. 

Senator Mundt. You never met her? 

Mr. Rumminger. No, sir. 

Mr. Kennedy. I can tell you. 

Senator Mundt. All right, if you can tell us. 

Mr. Kennedy. She is the sister of RoUand McMaster's wife. 

Senator Mundt. She is the sister-in-law, then, of Rolland Mc- 
Master ? 

Mr. Kennedy. That is correct. 

Senator Curtis. Mr. Chairman ? 

The Chairman. Senator Curtis. 

Senator Curtis. How would you deliver these checks to M & Gr 
Cartage ? 

Mr. Rumminger. I mailed the checks, sir. 

Senator Curtis. Do you recall the address ? 

Mr. Rumminger, No, sir, I can't. It was in Bloomfield, but I can't 
recall the address. 

Senator Curtis. But you always mailed them ? 

Mr. Rumminger. Yes. 

Senator Curtis. Did you have a covering letter with them all tha 
time? 

Mr. Rumminger. I beg your pardon ? 

Senator Curtis. Did you send a letter with them each time ? 

Mr. Rumminger. No, sir. 

Senator Curtis. You just mailed the checks? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15961 

Mr. RuMMiNGER. Yes. 

Senate:^ Curtis. That is all. 

Senator Mundt. Who on behalf of the M & G Cartage Co. ever 
came in and checked your books and examined your records to be sure 
you were sending the right amount? 

Mr. RuMMiNGER. No one ever checked. 

Senator Mundt. You could have sent them half as much and gotten 
by that way ? 

Mr. RuMMiNGER. Yes, sir. 

Senator Mundt. Nobody ever came and looked ? 

Mr. RuMMiNGER. No, sir. 

Senator Mundt. They just took your word for it? 

Mr. RuMMiNGER. Yes, sir. 

Senator Mundt. Did you have Mr. McMaster's name on the envelope 
in which you sent the checks ? 

Mr. Rumminger. I sent them to M & G Cartage. 

Senator Mundt. Did you have to have a street address or a post 
office address? 

Mr. Rumminger. I had the address. I don't recall what is was. 
But it was in Bloomfield. 

Senator Mundt. How big a city is Bloomfield? 

Mr. Rumminger. It is a suburb of Detroit. 

Senator Mundt. So you would have to have a street address? 

JVIr. Rumminger. Yes, sir. 

Senator Mundt. You must have that street address some place in 
your files and records? 

Mr. Rumminger. I do at home, yes. 

Senator Mundt. You did not submit that to the committee? 

Mr. Rumminger. No, sir. 

Senator Mundt. But you have it? 

Mr. Rumminger. Yes, sir. 

The Chairman. You may remain seated. 

You do solemnly swear that the evidence you shall give before this 
Senate select commitee shall be the truth, the whole truth, and nothing 
but the truth, so help you God ? 

Mr. IVIaher. I do. 

TESTIMONY OF JOSEPH F. MAHER 

The Chairman. State your name, your place of residence, and your 
present employment. 

Mr. Maker. My name is Joseph F. Maher. I live in Alexandria, 
Va., and I am a member of the staff of this committee. 

The Chairman. In the course of your duties, have you made an 
investigation of this particular business enterprise known as the 
M & G Trucking Co. or MG Trucking? 

Mr. Maher. Yes, sir. 

The Chairman. I hand you here a photostatic copy of a document 
and I will ask you to examine it and state if you can identify it. 

(Document was handed to the witness.) 

Mr. Maher. Yes, sir. 

The Chairman. What is it? 

Mr. Maher. This is a certificate of doing business under an assumed 
name. 



15962 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. It is what ? 

Mr. Maher. It is a certificate for doing business under an assumed 
name. 

The Chairman. For doing business under an assumed name? 

Mr. Maher. Yes, sir. 

The Chairman. Where is the certificate from, what authority? 

Mr. IVIaher. We received it from the Michigan secretary of state's 
office in Detroit, and it is in the name signed by Holland McMaster. 
The original is on file there. It is dated December 28, 1949, at which 
time he filed the certificate for doing business in the name of M & G 
Trucking Co. 

The Chairman. He filed this certificate in the secretary of state's 
office? 

Mr. Maher. Yes, sir. 

The Chairman. In 1949 ? 

Mr. Maher. Yes, sir. 

The Chairman. Certifying that he was doing business imder the 
name of MG Trucking Co., M cS^ G Trucking Co. ? 

Mr. Maher. Yes, sir. 

The Chairman. This is a photostatic copy from which you are 
testifying ? 

Mr. Maher. Yes, sir. 

The Chairman. It may be made exhibit No. 213. 

(Document referred to was marked "Exhibit No. 213" for reference 
and may be found in the files of the select committee. ) 

The Chairman. I hand you another photostatic copy of a document 
and ask you to examine it and state if you can identify it, please? 

(Document handed to the witness.) 

Mr. JSIaher. Yes, sir. 

The Chairman. What is it? 

Mr. Maher. This is a signature card that we received from the 
Detroit Bank, in Detroit, Mich., on the account of M & G Trucking 
Co. at that bank. The signature card reflects that Holland McMaster 
authorized Yvonne McMaster and Mary Alice Chenier to sign checks 
on behalf of M & G Trucking Co. 

The Chairman. On that account? 

Mr. Maher. On that account. 

The Chairman. That photostatic copy may be made exhibit No. 
214. 

(Document referred to was marked "Exhibit No. 214" for reference, 
and will be found in the appendix on p. 16179.) 

The Chairman. All right, Mr. Kennedy, have you further ques- 
tions ? 

Mr. Kennedy. What do the figures show as to the amomit of 
money that was paid to the M & G from Mr. Rummin^er ? 

Mr. Maher. Mr. Rumminger furnished the committee an affidavit 
in which he stated that — 

the approximate gross figures for the year 1955, in the name of Aero Cartage, 
was $170,090; for the year 1956, $275,987; for the year 1957, $210,957. The 
total for those 3 years : $(>57,034. 

Mr. Kennedy, This is the gross business that the McLouth Steel 
Co. gave to Mr. Rumminger's company ? 
Mr. Maher. Yes, sir. 



I]V1PR0PER ACTIVITIES IN THE LABOR FIELD 15963 

Mr. Kennedy. And this had increased from less than $50,000 in 
the previous year ; is that correct ? 

Mr. Mahek. Yes, sir. 

Mr, IvENNEDY. And went up materially. Then how much were 
the payments that Mr. Rumminger made each year to Mr. McMaster 
through the M & G Co.? The chairman read the total amount of 
$19,000. 

Mr. Maher, In 1955, the commission paid to M & G Cartage was 
$5,102.72. In 1956, the commission paid was $8,279.62. In 1957, 
$6,328.73. The total for the 3 years is $19,711.07. 

The Chairman. Are those figures substantially correct, Mr. Rum- 
minger? 

Mr. Rumminger. Yes, sir. 

The Chairman. You checked your records and you gave those 
figures in your affidavit? 

Mr. Rumminger. They were computed by the committee and I 
believe tliey are right, yes. 

The Chairman. You believe those figures to be accurate, to be 
correct ? 

Mr. Rumminger. Yes, sir. 

The Chairman, All right, Mr. Kennedy. 

Mr. Kennedy. You made these payments to Mr, McMaster 

Senator Mundt. Before we leave Mr. Maher, I have a question for 
him. 

The Chairman. All right. 

Senator Mundt. Did j-ou examine the bank accounts of the M & G 
Cartage Co. ? 

Mr. IVIaher. Yes, sir. 

Senator Mundt. Did it indicate that there were other sources of 
revenue other than the checks received from Mr. Rumminger? 

Mr. j\L\HER. Yes, sir. We could not identify those sources, but it 
did indicate there were other sources of revenue. 

Senator Mundt. Were they substantial sources ? 

Mr. Maher. Yes. 

The Chairman. Substantial amounts? 

Senator Mundt. Substantial amounts ? 

Mr. jSL^her. Yes, sir. 

Senator Mundt. About how large did the balance run ? 

Mr. Maher. We have the figures. Senator. 

Mr. Kennedy, Senator, we have learned from the tax returns of 
Mr, McMaster, made available to us, how much he declared from the 
M & G Cartage Co., if you w^ould like to have that. 

Senator Mundt. What I was trying to determine was whether he 
might have had arrangements similar to these with other operators 
besides ]\Ir. Rumminger, or wliether this was a bank account set up 
just to absorb the income from Mr. Rumminger. 

You tell me that this was just a fractional part of his total bank 
accounts ? 

Mr. Maher. Yes, sir. 

Senator Mundt. It was handled under the name of M & G Cartagre 
Co.? 

iSIr. Maher. Yes, sir. 



15964 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Senator Mundt. Do you have available the figures showing what 
the full amount of the account was or what its average monthly incre- 
ment was ? 

Mr. IVIaher. From his income tax return, Senator ? 

Senator Mundt. I mean from the bank account. Did you have 
access to the bank statements? Did you get a photostatic record of 
the bank statements ? Did you get it from the bank accounts ? 

Mr. Maker. Yes, sir; and they assimilate what he puts into his 
income tax returns. We have those figures available. We also have 
information on another company named Hess Cartage. He appar- 
ently had an identical arrangement with Hess Cartage. 

Senator Mundt. So the way it appears from the bank accounts 
there were at least two companies with which he had this commission 
arrangement ? 

Mr. Maher. Yes, sir. 

Senator Mundt. And there might have been more ? 

Mr. Maker. Yes, sir. The names of those companies we have not 
been able to find out. 

Senator IMundt. But you could get some deduction from the value 
of the accounts. Would you say that the Hess Co., the Kumminger 
Co., and the Aero Cartage Co., together would represent more or less 
than 50 percent of the velocity of the accounts ? 

Mr. Maker. I would say less, Senator. 

Senator Mundt. Less than 50 percent? 

Mr. Maker. I would say so. 

Senator Mundt. So that there was at least over twice as much other 
financial activity in the account which could or could not have been, 
as far as your records show, derived from the same type of commis- 
sion connection? 

Mr. Maker. Yes, sir. 

Senator Mundt. And there is nothing in the account that indicates 
the sources of this other revenue? 

Mr. Maker. No ; there is not. The names are not in the accounts, 
sir. 

Senator Mundt. Mr. Kumminger, are you still operating the Aero 
Cartage Co.? 

Mr. Kumminger. No, sir, I am not. 

Senator Mundt. Did you sell it out? 

Mr. Kumminger. It dissolved. There was nothing to sell out. 

Senator Mundt. Wliy did you dissolve it? 

Mr. Kumminger. I dissolved it in the first of 1958, when I took 
the job with Douglas on selling freight as well as steel. Business got 
so bad I couldn't keep on. 

Senator Mundt. Was this all the business you did, this $210,000 
with M. & G., or McLouth Co.? Was that all'the business you had? 

Mr. Kumminger. I had other accounts, smaller accounts; yes, sir. 

Senator IMundt. But the $6,000 that you earned as your share of 
that commission represented substantially the major part of j^our 
income; is that right? 

Mr. Kumminger. I would say yes. 

Senator Mundt. So you quit it to go into a salaried job? 

Mr. Kumminger. That is right. 



IIMPROPER ACTIVITIES IN THE LABOR FIELD 15965 

Mr. Kennedy. You paid this money to Mr. McMaster through the 
M. & G. Co. because of his ability to obtain this increase in business 
for you ; is that right ? 

Mr. RuMMiNGER. Yes, and to bring in other trucklines to share 
my overhead. My overhead was quite high. 

]\Ir. Kennedy. But there was no question at any time that he was 
the one that was able to bring this business to you? 

Mr. RuMMiNGER. I never doubted it ; no. 

Mr. Kennedy. Do you know who it was in the McLouth Steel Co. 
that he was able to contact? 

Mr. RuMMiNGER. No, sir ; I do not. 

Mr. Kennedy. Did you know that Mr. McMaster was the business 
agent for the McLouth Steel Co. employees ? 

Mr. Rumminger. No, sir ; I did not. 

The Chairivian. May I inquire, ^Ir. Counsel, if they had a contract 
at that time ? 

Did local 299 have a bargaining contract with this company ? 

Mr. Kennedy. The trucking company did, and Mr. McMaster was 
the business agent. 

The Chairman. Thank you. 

In other words, Mr. McMaster was arranging and dealing with a 
company that had a bargaining contract with the employees of this 
trucking company so he could get the commissions. 

Mr. Kennedy. That is correct. 

The Chairman. And he presumably, in the capacity he occupied 
as business agent to the company, should have been representing the 
interests of these employees ? 

Mr. Kennedy. That is right. 

The Chairman. Yet he was making an arrangement with this 
company, helping it direct its business to a source from which he 
could get a commission? 

Mr. Kennedy. That is correct. Mr. Chairman, the income tax 
returns that have been made available by Mr. McMaster indicate that 
in 1953 he cleared from the M. & G. Co. $387.51. In 1954, $15,228.92, 
and in 1955, $18,706.55 ; in 1956, $10,202 ; and in 1957, $11,465.21. 

The amount of money that he received from Mr. Rumminger was 
just less than 50 percent of the total income that he received in the 
M. & G. Cartage Co. He had other commission arrangements with 
companies that at the present time we do not have the names of. 

Senator Mundt. Have we explored the records of the Hess Truck- 
ing Co., Mr. Counsel? 

Mr. Kennedy. He had an interest in other trucking companies in 
addition to this, Mr. Senator, that we expect to go into. 

The Chairman. Is there anything further of this witness ? 

Mr. Kennedy. That is all. 

The Chairman. You may stand aside for the present. 

Call the next witness. 

Mr. Rumminger, you are not excused. We may want to recall you. 

Mr. Kennedy. Mr. Chairman, this is an affidavit from Mr. James E. 
Douglas. 

The Chairman. This affidavit will be printed in the record in full 
at this point. 



15966 IMPROPER ACTIVITIES EST TEffi LABOR FIELD 

(The affidavit referred to is as follows:) 

Affidavit 
State op Michigan, 
City of Detroit, ss: 

I, James E. Douglas, Jr., 1311 North Washington Street, Owosso, Mich., make 
this statement freely and voluntarily to Joseph F. Maher, who has identified 
himself to me as an investigator for the Senate Select Committee on Improper 
Activities in the Lahor or Management Field. I know that this statement may 
be used at a public hearing. 

I am the president of Douglas Trucking Lines, Inc., located at 1011 East Main 
Street. Owcsso. Our company was formed in 1923 ; our steel division in Detroit 
was set up in approximately 1953. Our primary business prior to 1953 was 
the hauling of general commodities other than steel. We hauled only a limited 
quantity of steel from the Detroit area. Mr. Bill Rumminger was at that time in 
his own company, Aero Cartage. Because of the loss of his ICC authority he 
wanted to discontinue his company and enter our employ. The original setup 
consisted of a straight commission arrangement with Mr. Rumminger of about 
10 percent. For this amount Mr. Rumminger rented the terminal, hired office 
help and dispatchers, and solicited the major steel accounts. Owner-operators 
were used entirely for hauling the steel products. In effect, this meant that all 
of our expenses were on a percentage basis, i.e., 75 percent to the owner-operator, 
10 percent to Rumminger, and 15 percent to Douglas Trucking as a net amount 
to cover our expenses, overhead, etc. This continued until January of this year 
when Mr. Rumminger went on a salary basis. His reasons for going on a salary 
basis and discontinuing Aero Cartage and the commission arrangement were 
these : 

1. Reduced volume of the auto industry had lowered his commission. 

2. Control of steel account had gradually shifted to the consignee and Mr. 
Rumminger's control of the steel accounts was thus weakened. 

3. Mr. Rumminger felt that the railroads were gradually taking over the 
primary steel accounts and that on a long-term basis he should begin to enter 
the so-called dry freight business. 

I first heard of M. & G. Trucking Co. a few weeks ago from Mr. Joseph Maher, 
of the Senate select committee. Prior to Mr. Maher's call I had not heard of 
M. & G. Trucking, nor had I heard of Mr. McMaster in connection with M. & G. 
Trucking. I had no knowledge that Mr. Rumminger was paying M. & G. Trucking 
or Mr. McMaster a commission. Subsequent to my talk with Mr. Maher, Mr. 
Rumminger called me and explained that he had been paying M. & G. Trucking 
2 percent of the revenue on all steel shipped by McLouth. He stated that this 
was in payment for the solicitation services of Mr. McMaster for the McLouth 
account. Prior to this telephone call I had no knowledge directly or indirectly 
of any business dealings between Mr. Rumminger and Mr. McMaster. 

Douglas Trucking had received no revenue from McLouth Steel prior to the 
setting up of our steel division in Detroit to the best of my knowledge. 

I do not know what contact Mr. RoUand McMaster had with any representative 
of McLouth Steel. 

As I remember, I first met Rolland McMaster at a luncheon meeting in Detroit 
approximately 2 years ago. This was to discuss a grievance case involving the 
discharge of a driver. We subsequently lost the case. I have only met Rolland 
McMaster about five or six times. I know of no other arrangements or deals 
between Douglas Trucking Lines or its employees with any other labor union 
officials or business agents. To my knowledge, we have done no business with 
any coini)any directly or indirectly connected with a labor union official other 
than with M. & G. Trucking. 

I have never had any threats or violence from any labor imion official, nor 
have I ever made a payoff directly or indirectly to any lahor union officials, nor 
to my knowledge, has any other Douglas Trucking employee. 

Prior to my conversations witli Mr. Rumminger a few weeks ago I never 
heard of Powers Trucking Co. and Douglas Trucking Co., never transacted any 
business with Powers Trucking to the best of my knowledge. 

The above statements are made to the best of my knowledge and belief. 

James E. Douglas, Jr. 
Sworn and subscribed before me this 10th of September, 1958. 

Dokothy Kemnttz, 
Notary Public, County of Wayiie, State of Michigan. 

My commission expires August 19, 1961. 



IMPROPER ACTIVmES IN THE LABOR FIELD 15967 

Mr. Kennedy. Mr. Garavaglia. 

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. Garavaglia. I do. 

TESTIMONY OF JOHN GARAVAGLIA, ACCOMPANIED BY COUNSEL, 
RICHARD C. VAN DUSEN 

The Chairman. State your name, your place of residence, and your 
business or occupation. 

Mr. Garavaglia. John G. Garavaglia, 13111 Rosedale, Wyandotte, 
Mich., traffic manager for McLouth Steel Corp. 

The Ch^^^irman. Thank you, sir. Do you have counsel? 

Mr. Garavaglia, Yes, sir. 

The Chairman. Counsel, will you identify yourself? 

Mr. Van Dusen. I am Richard C. Van Dusen, a member of the firm 
of Dickinson, Wright, Davis, McKean & Cudlip, of Detroit; a member 
of the jNIichigan bar. 

The Chairman. You may proceed, Mr. Kennedy. 

Mr. Kennedy. You are Mr. Garavaglia, G-a-r-a-v-a-g-1-i-a, is that 
correct ? 

Mr. Garavaglia. Yes. 

Mr. Kennedy. You have been employed for approximately 20 years 
'by the iMcLouth Steel Corp. ? 

JSIr. Garavaglia. That is right. 

Mr. Kennedy. The last 18 years as traffic manager ? 

Mr. Garavaglia. That is right. 

Mr. Kennedy. When did you first become acquainted with Holland 
McMaster? 

Mr. Garavaglia. Around 1953. We took over W. T. Cartage Co. 

Mr. Kennedy. Wliat is W. T. Cartage? 

Mr. Gar^vvaglia. A contractor for McLouth Steel Corp. 

Mr. Kennedy. 'What did they do? 

Mr. Garavaglia. They performed a service of hauling local com- 
moditi&s. 

Mr. Kennedy. They are the trucking company for McLouth Steel ? 

Mr, Garavaglia. That is correct. 

Mr. IvENNEDY. Did you know the arrangements between the 
McLouth Steel Co. and Mr. Rumminger to obtain business for the 
McLouth Steel Corp. ? 

Mr. Garavaglia, Will you repeat that, please ? 

Mr. Kennedy. Do you know of the arrangements between the 
McLouth Steel Corp. with Mr. Rumminger ? 

Mr. Garavaglia. There was no arrangements whatsoever made on 
it, on them hauling steel. They are a common carrier. 

Mr. KJENNEDY. Did you understand the arrangement between the 
McLouth Steel Corp. and Mr. Rumminger for JMr. Rumminger to 
attempt to obtain business for the McLouth Steel Corp., for the 
hauling. 

Mr. VAN Dusen. Would you mind repeating your question, Mr. 
Counsel ? 

Mr. Kennedy. How long have you known Mr. Rumminger? 

Mr. Garavaglia. Approximately 12 years. 



15968 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. Were you aware of the arrangement that he had 
with the Douglas Trucking Co. to obtain contracts for the hauling of 
steel? 

Mr. Garavaglia. He did not obtain a contract from McLouth Steel. 

(The witness conferred with his counsel.) 

Mr. Kennedy. Did you know of that arrangement ? 

Mr. Garavaglia. Yes ; I knew of that arrangement. 

Mr. Kennedy. Who informed you about that arrangement ? 

Mr. Garavaglia. Mr. Rumminger, himself. 

Mr. IvENNEDY. When was that ? 

Mr. Garavaglia. Approximately in 1953, 1 believe. 

(The witness conferred with his coimsel.) 

The Chairman. Was that an arrangement whereby Mr. Rum- 
minger was to go out and get business and get a commission on it if 
he could get people to patronize your company ? Is that correct ? 

Mr. Van Dusen. Mr. Chairman, I think if Mr. Garavaglia just 
tells you the circumstances under which Mr. Rumminger called upon 
him, it would satisfy the question. 

The Chairman. Give us the story. 

Mr. Garavaglia. Mr. Rimiminger called on me first when he 
worked for Hancock Trucking. He was soliciting for Hancock 
Trucking. That is another trucking company that hauls iron and 
steel arms. At the time Hancock went out of business, Bill Rum- 
minger started with Douglas, and he has been calling on me ever since 
and still calls on me today, on soliciting business for his trucking 
company. 

The Chairman. I thought he was out of business ? 

Mr. Garavaglia. No, sir; he is not. He might be, but Douglas is 
still operating. 

The Chairman. Douglas is still operating ? 

Mr. Garavaglia. Yes, sir ; and he still calls on me, Mr. Rumminger 
himself. 

The Chairman. He may call on you, but I understood him to testify 
that his company is out of business. 

Mr. Garavaglia. Well, I don't know anything about his. I am 
referring to Douglas Truck Lines. 

The Chairman. All right. Proceed. 

Mr. Kennedy. The W & T Cartage Co. hauls locally; is that 
correct ? 

Mr. Garavaglia. That is correct. 

Mr. Kennedy. And the Douglas Trucking Co. would be one of 
several companies that would haul long distance? 

Mr. Garavaglia. Intra; that is right. 

Mr. Kennedy. And he, as you understood it, was working for the 
Douglas Trucking Company, attempting to get business? 

Mr. Garavaglia. That is right. 

Mr. Kennedy. And you were working for the McLouth Steel 
Corp. ? 

Mr. Garavaglia. That is right. 

Mr. Kennedy. In your capacity as traffic manager for the McLouth 
Steel Corp., would it be your decision as to what company would 
receive the contracts for the hauling of this, interstate ? 



IMPROPER ACTIVmES EST THE LABOR FIELD 15969 

Mr, Garavaglia. Well, that is a difficult question to answer. You 
are saying a contract. We have no contract with any carrier. They 
are common carriers, 

Mr, Kennedy. Would it be your responsibility to make the ar- 
rangements ? 

Mr. Garavaglia. Yes. 

Mr. Kennedy. It would be your responsibility. Did Mr. Rolland 
McMaster ever speak to you about giving more business to the Doug- 
las Trucking Co. ? 

Mr. Garavaglia. No, he has not. 

Mr. Kennedy. According to the previous witness, he entered into 
an arrangement in 1955 whereby Mr. Holland McMaster, if he could 
obtain an increase in business from your company, was to receive a 
percentage of the profits. Immediately thereafter, the business from 
the McLoutli Steel Corp, increased tremendously. 

Can you give us any explanation of that ? 

Mr, Garavaglia. Yes, I can. It was due to the fact that our ton- 
nage had increased over the period of years that we were coming up 
the ladder. Our tonnage has gotten greater and we have used more 
carriers in our organization, 

Mr, Kennedy. You had carriers that you had used for an extended 
period of time, you had some of the largest trucking companies in 
the ^lichigan area that could have been hauling this steel. Wliy was 
it that you turned to this new company that was handling a relatively 
minor amount of your business? 

Mr. Garavaglia. Tliey could not handle all the business that we 
had at the time Douglas Trucking started with us. Our tonnage had 
increased tremendously, and we still have the various companies we 
use right now, and they still haven't had enough equipment to take 
care of us. 

Mr. Kennedy. Your business with this company increased 400 or 
500 percent over a period of some 5 or 6 months. It was immediately 
after Mr. McMaster had a conversation with you. 

Mr. Gar^waglia, I don't know about that, 

Mr, Kennedy, You had no conversation at all with Mr, McMaster? 

Mr. Garavaglia. No, sir ; I did not. 

Mr. Kennedy, He never urged you to give your business to the 
Douglas Trucking Co, ? 

Mr, Garavaglia, No, sir. 

Mr. Kennedy. You never had any conversations at all ? 

Mr. Garavaglia. None whatsoever. 

Mr. KJENNEDY. Did IMr. McMaster suggest to you that you go into 
business together? 

Mr. Garavaglia. No, sir, 

Mr, Kennedy, He never made a suggestion of that kind ? 

Mr, Garavaglia, No, sir. 

Mr, Kennedy, Did you ever go into business with McMaster? 

Mr. Garavaglia. No, sir. 

Mr. Van Dusen. Might the witness be permitted to elaborate a lit- 
tle on the question of the volume given to Douglas Trucking Co. ? 

The Chairman, Yes. 



15970 IIMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Garavaglia. We had not taken any business away from any 
carrier whatsoever when Douglas started. They all received their 
fair portion of steel out of our plant. 

Mr. Van Dusen. The business you gave to Douglas was increased 
business over and above the amount you had formerly in total ? 

Mr. Garavaglia. That is right. 

The Chairman. How much had your business increased after 
1954 ? In 1954 what was the amount that this company received ? 

Mr. Kennedy. Less than $50,000. 

The Chairman. Say $50,000 in 1954. 

Mr. Kennedy. It went to $170,000 in 1955 and $270,000 in 1956. 

The Chairman. That would be an increase of 400 or plus percent, 
between 400 and 500 percent. Did the gross business of your com- 
pany increase that much during that period of time ? 

Mr. Garavaglia. Yes, sir; just about. 

The Chairman. 400 or 500 percent in a year or two ? 

Mr. Garavaglia. Yes, sir. We went through a $210 million expan- 
sion at that time and the facilities were ready for operation. We 
started there veiy small with two electric furnaces. In our business 
now we have four electric furnaces, two blast furnaces, an oxygen 
plant. We were producing probably around 40,000 tons a month 
then and we are producing now 145,000 tons. 

Mr. Kennedy. I felt we should have this witness called before the 
committee, Mr. Chairman, to get this explanation. The previous wit- 
ness testified that he gave Mr. McMaster 50 percent of the profits based 
on the fact that Mr. McMaster said he could deliver this business. 

In order to tell the committee the story, we felt it was important 
that this witness be called to testify as to his participation in this com- 
pany. 

The Chairman. According to the record up to this point, Mr. Rum- 
minger actually paid out some $19,000 in commissions, to McMaster, 
on the basis of this business that was received from your company. 
That is the testimony, undisputed up to this point. 

You say that it wasn't necessary for him to pay out that money 
because you were going to give him the business anyhow ? 

Mr. Garavaglia. That is correct. 

The Chairman. So he was a pretty stupid businessman? That is 
what you would have to conclude? 

Mr. Garavaglia. That is right. 

The Chairman. That is, unless the deal was actuallj' made. Of 
course, the question of the propriety of a business agent going out 
and dealing in such things is still a matter of concern. 

Is there anything further? 

Mr. Van Dusen. Might I add just a couple of things to the record? 

Listening to the previous testimony, I think it should be clear on 
the record, and you have affidavits in your file to this effect, that Mc- 
Louth Steel Corp., has no contract with the Teamsters Union or with 
any of its local unions, no contract of any kind with Rolland Mc- 
Master. 

I should also mention that the great bulk of the freight payments 
which we are talking about to Douglas Trucking were not made by 
McLouth, but were made by shippers who were purchasing the st«el 
and paying the freight collect. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15971 

Mr. Kenkkdy. On the first, point, the W & T Cartage Co., which 
does the local hauling for the McLoiith Steel Corp., has a contract 
with the Teamstei-s Union. 

Mr. Van Dusen. That is correct, but W & T is not affiliated with 
McLouth Steel Corp. 

Mr. Kennedy. But it is owned by McLouth employees, and the 
business agent for the employees of the W & T Cartage Co. is Holland 
McMaster. 

Mr. Van Dusen. That is correct, but I wanted to have the distinc- 
tion perfectly clear that McLouth has no contract with the Teamsters 
whatsoever. They are represented by the Steelworkers. 

The Chairman. Are there any further questions of this witness? 

Mr. Kennedy. That is all, Mr. Chairman. 

The Chairman. All right. You may stand aside. 

Mr. Van Dusen. May the witness be excused ? 

The Chairman. We probably can excuse you at the noon hour when 
we adjourn. We will wait and see. You may stand aside for the 
present. 

Mr. Kennedy. I would like to recall Mr. Maher to give the infor- 
mation we have about the rest of the trucking companies. 

TESTIMONY OF JOSEPH F. MAHER— Resumed 

Mr. Kennedy. Mr. Maher, we found that EoUand McMaster has 
an interest in another trucking company ? 

Mr. ^L^her. Yes, sir. 

Mr. Kennedy. Would you tell us what other trucking companies ? 

Mr. Maher. In 1950 he had an interest in Powers Trucking Co. 

Mr. Kennedy. What was the Powers Trucking Co. ? 

Mr. Maher. It was a regular local transit company formed by 
Edward Powers and RoUand McMaster in approximately 1950. 

Mr. Kennedy. How long did he keep his interest in that company ? 

Mr. Maher. I believe it was 1956. 

Mr. Kennedy. And in addition to that, has he had an interest in 
other trucking companies ? 

Mr. Maher. Yes, sir. The records we obtained reflect that he had 
an interest in Reed Transportation Co. I believe it was a partnership 
with Jack C. Reed and RoUand McMaster. 

Mr. Kennedy. What was that company ? 

Mr. Maher. This was a local transit company around Detroit. I 
believe that the officers of the company were Reed as president, and 
Yvonne McMaster, secretary. 

Mr. Kennedy. Wlio is Yvonne McMaster ? 

Mr. Maher. Rolland McMaster's wife. Rolland McMaster was on 
the board of directors. 

Mr. Kennedy. When did that company come into business? 

Mr. Maher. I believe it was 1953, approximately. 

Mr. Kennedy. Was that company succeeded by another trucking- 
company ? 

Mr. Maher. Yes, sir; a company by the name of Ram Transit 
Corp., Inc., a corporation formed by three individuals. Jack Reed, 
formerly of Reed Transportation, a man named Allen, and Rolland 
McMaster. 



15972 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. What was the Ram Transporting ? What did they 
do? 

Mr. Mahee. I believe it was a f ollowup to Reed Transportation Co. 

Mr. Kennedy. What services did they perform? Were they in 
the leasing business ? 

Mr. Mahee. Yes. 

Mr. Kennedy. They leased to other trucking companies ? 

Mr. Mahee. Yes, sir. 

Mr. Kennedy. Do we have any figures on Ram Transport, Inc. ? 

Mr. Mahee. I believe we do, sir. 

Yes, sir. We have obtained work papers from Lewis Rosen, an 
accountant for Rolland McMaster and also for the various companies 
that he was associated with. Mr. Rosen's papers that we obtained 
reflect that Ram Transport, Inc., received $24,978.44 between Septem- 
ber 16, 1954, to September 15, 1956. Ram Transport received this 
money, I believe, from Darling Freight Lines, in Grand Rapids, Mich. 

Mr. Kennedy. For what services ? Do you know? 

Mr. Mahee. I believe it was in connection with the hauling of 
freight for Darling. 

Mr. Kennedy. Did we find Mr. McMaster in any other companies ? 

Mr. Mahee. Yes, sir. Powers Trucking Co. was succeeded by a 
company called Aggregates Transport, Inc. 

Mr. Kennedy. How do you spell that ? 

Mr. Mahee. A-g-g-r-e-g-a-t-e-s. I believe Rolland McMaster was 
helpful to Edward Powers, whom he had known for about 30 years, 
in setting up Aggregates Transport, Inc. 

Mr. Kennedy. Did he have a financial interest in Aggregates ? 

Mr. Mahee. We are not able to ascertain exactly what financial 
interest he had ; no, sir. There is another company called Canter's, 
Inc., that was incorporated in January 1951.- The incorporators were 
Rolland McMaster, George Roxburgh, Jr. 

Mr. Kennedy. Who is George Roxburgh ? 

Mr. Mahee. A business agent of the Teamsters. 

Mr. Kennedy. And James M. Clif t ? 

Mr. Mahee. Yes, sir. 

Mr. Kennedy. Who is James M. Clift? 

Mr. Mahee. Also a business agent of the Teamsters Union. 

Mr. Kennedy. Wliat was the function of that company ? 

Mr. Mahee. To manage, lease, and sell real estate and principally 
to own and operate a riding stable. 

Mr. Kennedy. They had horses ? 

Mr. Mahee. Yes, sir. 

Mr. Kennedy. They leased out the hoi-ses ? 

Mr. Mahee. I believe so, sir. 

Mr. Kennedy. Did you find any of his relatives in any other 
company ? 

Mr. Mahee. Yes, sir. I believe Yvonne McMaster, his wife, was 
an officer in Reed Transportation. 

Mr. Kennedy. I mean other than the ones you have mentioned. 

Mr. Mahee. Yes, sir. There is a nephew by the name of Carl 
McMaster who started the Enterprise Equipment & Leasing Co. The 
articles of incorporation of that company are dated March 30, 1956. 
Carl, I believe, is a nephew of Rolland McMaster. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15973 

Mr. Kennedy. Do you know what the function of that company 

was « ^ ■^ 

Mr. Maker Principally to buy, sell, or lease terminals of any kind. 
1 also believe from the interview with Mr. Rosen and his work papers 
that this company was started with a loan of $5,000 from Yvonne 
McMaster. 

Mr. Kennedy. That is Mr. :McMaster's wife ? 

Mr. Maher. Yes, sir. 

Mr. Kennedy. Then he has a farm also ; is that right ? 

Mr. Maher. Yes, sir; out in Wixom, Mich. 

Mr. Kennedy. What is the name of that farm ? 

Mr. Maker. Idle Acres Ranch. 

Mr. Kennedy. Do you know how large the farm is ? 

Mr. Maker. Probably around 20 acres. I am not certain. 

Mr. Kennedy. You have examined the income tax returns of Mr 
McMaster ? 

Mr. Maker. Yes, sir. 

Mr Kennedy. Would you relate to the committee what they dis- 
close for these various trucking companies and other businesses ? 

Mr. Maker. Yes. sir. We received these income tax returns from 
Lewis Rosen, Mr. McMaster's accountant. A summary of the returns 
for the years 1949 through 1957 reflect 

Mr. Kennedy. I think you have to take it each year. I don't think 
it would show by adding the figures up. 

Mr. Maker. The income tax return reflects for 1953 Mr. McMaster 
recen^d income from Powers Transport in the amount of $805 : $300 
from Canter's, Inc.; $387.51 from M & G Trucking, and $747.73 from 
Keed 1 ransportation Co. 

<£o?Qn oo^^"^"^^ ^^^ ^^^^ ^^^^ reflected a farm loss for that year of 

»p2,oo0.38. 

Mr. Kennedy. Then income from the union of $10,175 ? 

Mr. Maker. Yes, sir. 

Mr. Kennedy. Let me just read these figures off and you tell me 
whether they are correct. In 1954, $10,070 from the union; is that 
right ? ' 

Mr. Maker. Yes, sir. 

Mr. Kennedy. Commissions, $283.80 ? 

Mr. Maker. Yes, sir. 

Mr. Kennedy. In 1953 he declared commissions of $1,964.65 ? 

Mr. Maker. Yes, sir. 

Mr. Kennedy. There is no telling where that money came from « 

Mr. Maker. No, sir. 

Mr. Kennedy. Then Ram Transportation, $1,225; is that right? 

Mr. Maker. Yes, sir. 

Mr. Kennedy. M & G, $15,228.92 ? 

Mr. ^Iaker. Yes, sir. 

Mr. Kennedy. And a farm loss of $2,446.78 ? 

Mr. jVIaher. Yes, sir. 

Mr. Kennedy. Making a total income of $24,215 ? 

Mr. Maker. Yes, sir. 

Mr. Kennedy. Then in 1955, $10,070 from the union ? 

Mr. Maher. Yes, sir. 

Mr. KJENNEDY. $1,700 in commissions? 

36751— 59— pt. 43 3 



15974 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Maher. Yes, sir. ..• orooi?;? 

Mr. Kennedy. Powers Transportation, ^2,245 { 
Mr. Maher. Yes, sir. 
Mr. Kennedy. M &G$18,706.55 ? 

Mr. Maher. Yes, sir. 4; Oii n ^aY 79 « 

Mr. Kennedy. A loss from the farm ot $10,647.72 ? 

Mr. Maher. Yes, sir. 

Mr. Kennedy. Makmg a total of $23,936.99 ^ 

Mr Maher. Yes, sir. . , 

Mr. Kennedy. Then in 1956, $10,070 from the miion ? 

Mr. Maher. Yes, sir. , . 

Mr. Kennedy. $1,200 in commissions^ 

Mr. Maher. Yes, sir. . ^- ^t 

Mr. Kennedy. $525 from Powers Transportation ^ 

Mr. Maher. Yes, sir. ^ . „ ^ 9 

Mr. Kennedy. $10,202 from M & G ? 

Mr. Maher. Yes, sir. 4= dii a aoj. f^Q 2 

Mr. Kennedy. A loss from the farm of $14,49-1.59 i 

Mr. Maher. Yes, sir. -p (£1 o ftsf^ a.1 ? 

Mr. Kennedy. Making a total income of $10,685.41 { 

Mr. kZedy^ Then last year, 1957, $10,070 from the union ? 

Mrllv^EDY^l'bo in commissions, $11,465.21 from M & G 

Trucking ? 

Mr. Maher. Yes, sir. 

Mr. Kennedy. And a farm loss of $19, < 94.01 < 

Mr. Maher. Yes, sir. . ctoo^TQft? 

Mr. Kennedy. Making his income $3,847.36 ^ 

Mr Maher. Yes, sir. We observed, sir, that as the M & ^ /™ 
in"me was increased, the farm losses also mcreased at the same 

^'Tenator Ervin Maybe Mr. McMaster had become what is called an 
agtcutirist'X is I person who makes his money m the city and 
loses it on the farm. 

Mr. Kennedy. Can we recall Mr McMaster 

The (^HAiRMAN. Come forward, Mr. McMaster. 

TESTIMONY OF ROLLAND McMASTER, ACCOMPANIED BY COUNSEL, 
HARRY CLIFFORD ALLDER— Resumed 
Mr Kennedy. Mr. McMaster, during the 1930's you were convicted 

^'i:i^"£i:'r M;; K!:;m^I-respectfully decline to aiiswer be- 
cause" I honestly believe my answer might tend to mcrnninate me 

Mr Kennedy. In 1932, for the attempted larceny of auto t res, 
1936, aiw^^^ult and batteiy, and 1936 larceny ; is that correct? 1 hose 

*^Mr McilTsTERS. I respectfully decline to answer because I honestly 
believe my answer might tend to mcnnunate me. ^„, f,,„n 

Mr Kennedy. MrrHoifa was attempting to get a deferment f.mn 
the Iraf for vol, and he wrote a letter and said, you were promoted 
to b less repres;ntative on December 19, 1941 : is that correct? , 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15975 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Isn't it correct that at that time that the letter was 
written, or at the time you received that promotion, you were out on 
bail after beinp; arrested for felonious assault in the fact that you as- 
saulted two brothers, the Smith brothers, with baseball bats and knives, 
you and seven other individuals from the Teamsters Union? 

Mr. McMvsTER. I respectfully decline to answer because I honestly 
believe my answer mijjht tend to incriminate me. 

Mr. Kennedy. Isn't it correct that this was never followed up 
because the Smith brothers refused to sign a complaint against you? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believ^e my answer might tend to incriminate me. 

Mr. Kennedy. Did you, in fact, assault them with baseball bats 
and knives, Mr. McMaster? 

Mr. McMaster. I res]:)ectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Could you clear up for us the situation regarding 
the payment that you received from Mr. Rumminger for obtaining 
the business from the INIcLouth Steel Corp. ? 

Could you tell us how you were able to obtain that contract, that 
account ? 

Mr. Mc]\L\STER. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Would you tell us what the charge in your income 
tax returns each year is to income received from commissions, $1,000 
and $1,800, and who that comes from? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Would you tell us what trucking companies paid 
you that money, Mr. McMaster? 

Mr. MclVL^STER. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Did you ever receive any money from the Bridge- 
way's Co., the Bridgeway's Corp., in Michigan? 

Mr. McIVIaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

(Present at this point: Senators McClellan and Ervin.) 

Mr. Kennedy. Mr. McMaster, when our investigator, Mr. Maher, 
interviewed you at Teamster headquarters, did you strike him? Did 
you hit him at all? 

Mr. McIVIaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Would you tell the committee what the reason was 
for your hitting Mr. Maher and then, when you were surrounded by 
six or seven other Teamster officials, you bodily pushed him out of the 
Teamster headquarters ? 

Mr. McMaster. I respectfully decline to answer because I honastly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. It is correct, is it not, that this happened in the 
Teamster headquarters in Detroit? 

Mr. McMASTFJi. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 



15976 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. Did you say or tell Mr. Maher lie was a Communist 
for investigating you ? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. And did you tell him that he should have been in 
the service and that you had been fighting against people like Mr. 
Maher? 

Mr. McMasi^er. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. And didn't Mr. Maher explain to you at that time 
that he had spent 3 years in the service? 

Mr. McMaster. I respectfully decline to answer the question be- 
cause I honestly believe my answer might tend to incriminate me. 

Mr. Kennedy. Isn't that the time, when you were surrounded by 
these otlier six or seven Toamster officials, that you threw him out 
of the headquarters of the Teamsters Union? 

Mr. McMaster. I respectfully decline to answer the question be- 
cause I honestly believe that my answer might tend to incriminate me. 

Mr. Kennedy. Mr. Chairman, we had subpenas served on this 
witness for all his personal books and records, as well as the books 
and records of the businesses thnt he owns and operates. 

The Chairman. Where are those checks, the other exhibits? 

Mr. Kennedy. They are here. 

The Chairman. The Chair presents to the witness a series of 
checks that have been made exhibit No. 212, checks that were drawn 
by William Rumminirer, made payable to the M. & G. Trucking Co. 
and M. & G. Cartage Co. 

I ask you to examine that exhibit and examine those checks and 
state if you identify them. 

(Tlie documents were handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. Allder. What is the question, Senator? 

The Chairman. I asked him to examine the checks and state if 
he identifies them. 

Do you identify those checks? 

Mr. McMaster. Mr. Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

The Chairman. I hand you here exhibit No. 213, which is a photo- 
static copy of the certificate of conducting business under an assumed 
name. It appears to be dated the 28th day of December 1949. It 
has been made exhibit No. 213. 

I will ask you to examine that and state if you identify it. 

(The document was handed to the witness.) 

(The witness conferred with his counsel.) 

The Chairman. Do you identify the document, exhibit No. 213, 
which the Chair has presented to you ? 

Mr. McMaster. Mr. Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

The Chairman. It bears the signature of Rolland McMaster. I 
will ask you to examine that signature and state if it is yours. 

(Tlie witness conferred with his counsel.) 

Mr. McMaster. Mr. Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15977 

The Chairman. Did you file this certificate with the secretary of 
state ? 

(The witness conferred with his counsel.) 

Mr. McMaster, I respectfully decline to answer because I honestly 
believe my answer mi^rht tend to incriminate me. 

The Chairman. Who is Miss Chenier ? 

Mr. McMasttsr. I respectfully decline to answer the question because 
I honestly believe my answer might tend to incriminate me. 

The Chairman. Do you know her ? 

Mr. McMasi-er, Mr. Chairman, I respectfully decline to answer the 
question because I honestly believe my answer might tend to 
incriminate me. 

The Chairman. Is she your wife's sister ? 

Mr. McMaster. I respectfully decline to answer the question be- 
cause I honestly believe my answer might tend to incriminate me. 

The Chairman. In other words, if she is your wife's sister, that 
might tend to incriminate you ? 

(The witness conferred with his counsel.) 

Mr. McMaster. Mr. Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

The Chairman. I hand you here exhibit No. 214, which appears to 
be a signature authorization for the drawing on a bank account. I 
will ask you to examine it and state if you identify it. 

(Document handed to the witness.) 

(Witness conferred with his counsel.) 

Mr. MCiNlASTER. ]Mr. Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

The Chairman. According to this exhibit 214, Yvonne McMaster 
and Mary Alice Chenier are authorized to draw checks on this account. 
The account is in the name of M. & G. Trucking Co. This authoriza- 
tion bears the signature of Rolland McJNIaster. Did you sign this 
authorization ? 

(Witness conferred with his counsel.) 

Mr. McINIaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Who is Yvonne McMaster? 

(The witness conferred with his counsel.) 

Mr. McMaster. Mr. Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

The Chairman. Is she your wife? 

Mr. McMaster. Mr, Chairman, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

The Chairman. Is not Mary Alice Chenier a sister of your wife, 
Yvonne McMaster ? 

Mr. McMaster. I respectfully decline to answer the question be- 
cause I honestly believe my answer might tend to incriminate me. 

The Chairman. And did you not in this authorization designate 
them as persons to sign checks on the account of the M. & G, Truck- 
ing. Co.? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. And is it not the same Mary Alice Chenier who 
endorsed all of the checks that are covered in exhibit 212 in order 
to deposit this money to the credit of this account ? 



15978 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer miglit tend to incriminate me. 

The Chairman. How much of the money did you get out of this 
account ? 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. In other w^ords, you have been involved in a trans- 
action, if you were involved, you were involved in a transaction, about 
which you cannot testify without the risk of self-incrimination; is 
that correct ? 

Mr. McMaster. I respectfully decline to answer the question be- 
cause I honestly believe my answer might tend to incriminate me. 

The Chairman. I hand you here a subpena that is directed to 
Rolland McMaster, issued by this committee. According to the re- 
turn on it, it was served on you on the 23d day of July 1958. I ask 
you to examine the subpena and state if you identify it as the sub- 
pena that was served on you. 

(The document was handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. McMaster. A subpena was served on me on or about that time, 
sir. 

The Chairman. Does that appear to be it? 

Mr. McMaster. It has the appearance of the one that I received. 

The Chairman. You do not deny that you received such a sub- 
pena? 

Mr. McMaster. No. 

The Chairman. All right. 

You were ordered and directed in this subpena to produce certain 
records. This subpena may be printed in full, together with tlie re- 
turn thereon, in the record at this point. 

(The subpena follows :) 

United States op America 

Congress of the United States 

Lr4647 
To Rolland McMaster, Wixom, Mich., Greeting: 

Pursuant to lawful authority, you are hereby commanded to appear before 
.the Senate Select Committee on Improper Activities in the Labor or ^lanagement 
Field of the Senate of the United States, forthwith, at their committee room, 
101 Senate Office P.uilding, Washington, D.C., then and there to testify what you 
may know relative to the subject matters under consideration by said committee, 
and to produce duces tecum in accordance with the schedule attached hereto 
and made a part hereof. 

Ileieof Fail Not, as you will answer ydur default under the pains and penalties 
in such cases made and provided. 

Given under my hand, by order of the committee, this 19th day of July, in the 
year of our Lord one thousand nine hundred and fifty-eight. 

(Signed) John L. INIcCi-eixan, 
Chairnidn, Senate Select Committee on Improper 

A ctirities in the Labor or Management Field. 

Production of those records at Washington, D.C., will be waived if they are 
made available immediately at Detroit, Mich. 

schedule to subpena L-4 647 

To T)roduce duces tecum your personal records for the period January 1, 1949 
to date, including cash re<'eipls and disbursements, bank statements, canceled 
checks, correspondence files, paid bills, and any and all documents that relate in 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15979 

iiuy way to loans, loan accounts and to your ownership, oiK'ration and control 
of the following; conn)anies : Powers Trucking Company, Aggregate Transport 
Company. Ram Transport Company, M. & G. Trucking Company, Enterprise 
Equipment and Leasing Comi)any, and any and all other comiianies, corporations, 
and i)artnerships in which you have a financial interest for the said period of 
time. 

SERVICE 

JULY 23, 1958. 
I made service of the within subpena by delivery personally a copy to the 
within-named Holland McMaster, at 2741-TrumbulI, Detroit, Mich., at 9:35 
o'clock a. m., on the twenty-third day of July, 1958. 

(Signed) Joseph F. Maher. 

The Chairmax. You were ordered by this subpena to produce cer- 
tain records, certain of your personal records. Have you complied 
witli the subpena ? 

(The witne.ss conferred with his counsel.) 

Mr. Allder. Senator, there is a little confusion about that. I think 
the facts are that the committee went and got the records, wdiich are 
named there. They do have them in their possession. 

The Chairman. I will ask the question this way. In this subpena 
you were directed to produce duces tecum your personal records for 
the periods January 1, 1949, to date, including cash receipts and dis- 
bursements, bank statements, canceled checks, correspondence files, 
paid bills and any and all documents that relate in any way to loans, 
loan accoimts, and to your owmership, operation and control of the 
following companies: Powers Trucking Co., Aggregate Transport, 
M & G Trucking Co., Enterprise Equipment & Loading Co., and any 
and all other companies, corporations and partnerships in which you 
have a financial interest for the said period of time. 

The question is : Have you undertaken to comply or have you com- 
plied with that direction and subpena ? 

(The witness conferred with his counsel.) 

Mr. Mc]Master. What was your question again, JNIr. Senator? 

The Chairman. Without repeating and identifying all the records, 
the question is : Have you complied with the subpena with respect to 
turning over these records or producing them ? 

(The witness conferred with his counsel.) 

Mr. McMaster. Yes. 

The Chairman. How have you complied with it ? 

(The witness conferred with his counsel.) 

Mr. McMaster. The committee has the records in their possession. 

The Chairman. Do you have any other records other than those 
that the committee has secured ? 

(Witness conferred with his counsel.) 

Mr. McMaster. To the best of my knowledge, tlie committee has all 
the records that were necessary under the subpena. 

The Chairman. I didn't say necessary. 

Mr. McMaster. I mean all that I knew about then. 

The Chairman. You are telling this committee now you have no 
other records other than those that the committee has now ? 

Mr. Allder. That is at the time of the serving of the subpena. 

The Chairman. At the time of the serving of the subpena ? 

Mr. McMaster. That is right, Mr. Chairman. 

The Chairman. You state that under oath ? 

Mr. McMaster. Yes. 



15980 IMPROPER ACTIVITIES EST THE LABOR FIELD 

The Chairman. You have not subsequently destroyed any records 
that you had at that time ? 

(The witness conferred with his counsel.) 

Mr. McMaster. No. 

Mr. Kennedy. Do you have any checks for the Ram Transporta- 
tion Co.? 

Mr. Allder. I think we ought to be a little more explicit about that, 
Mr. Kennedy. If you add to that question in existence at the time 
of the serving of the subpena, I think, it is then just one thing. But 
if you just want to ask a general question, it will bring a different 
answer. 

The Chairman. All of these questions with respect to the docu- 
ments are confined to the time of the service of the subpena. 

(The witness conferred with his counsel.) 

Mr. Kennedy. Did you have any canceled checks from the Ram 
Transportation Co. at the time of the service of the subpena ? 

Mr. McMaster. No. 

Mr. Kennedy. What had happened to the canceled checks from that 
company ? 

(The witness conferred with his counsel.) 

Mr. Mc]VL\ster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Did you anticipate the service of the subpena and 
the investigation and tlius destroy your records, Mr. McMaster? 

Mr. McMaster. No, I did not. 

Mr. Kennedy. What happened to the checks from the Ram Trans- 
portation Co.? 

(The witness conferred with his counsel.) 

Mr. McIVIaster. Mr. Kennedy, to the best of my ability I believe 
the committee has those records. 

Mr. Kennedy. We do not have any checks for that company. We 
do not have any checks for the Powers Trucking Co. We do not have 
any checks for the M & G Cartage Co., and we do not have receipts 
and disbursements for these companies. 

Where are all those records? They were not turned over to us. 

(The witness conferred with his counsel.) 

Mr. Kennedy. Mr. Chairman, we have received some records from 
the accountant of Mr. McMaster's, as related. But these, for the most 
part, except relating to Mr. McMaster's income tax statements, were 
Mr. Rosen's own records. They were work papers that Mr. Rosen 
had made up, based on the accounting work he had done for Mr. Mc- 
Master. But we have not received in any substantial degree any of 
the books and records of Mr. McMaster. That is, except for the farm. 
We have received the books and records for the farm. But we have 
not received the books and records of the M & G Cartage Co., Powers 
Trucking, and the canceled checks for these companies, which are 
extremely important. 

The Chairman. Where are those records, Mr. McIMaster? 

Mr. Ali.der. Senator, he would like to answer the question, if he 
knew, but as far as he knew, the accountant has them or the Internal 
Revenue has them. 

Tlie Chairman. Let him answer. He is under oath. 

Where are the records of these companies, the Powers Trucking 
Co., the Aggregate Transport Co. ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15981 

Mr. McMaster. I believe all of those records that you would want 
of me are either in the Internal Kevenue's office or the committee's 
office. 

The Chairman. You do not have them ? 

Mr. McMaster. No, sir. 

The Chairman. You have not withheld any records from this 
conmiittee, called for by this suhpena 'i You state that under oath ? 

(The witness conferred with his counsel.) 

Mr. McMaster. Knowingly, I don't have any records, sir. 

The Chairman. You state under oath that you have not withheld 
or concealed any of the records called for by this subpena? 

Mr. McMaster. Yes, sir. Knowino^ly 1 don't know of any. 

Mr. Kennedy. The fact is, jSIr. Chairman, we still do not have 
these records. 

The Chairman. The Chair presents to you another subpena served 
on you on the 23d day of July, 1958, served on you as an officer of 
the following companies : Powers Trucking Co., Aggregate Transport 
Co., Ram Transport Co., M & G Transport Trucking Co., and Enter- 
prise Equipment and Leasing Co., directing you to produce for the 
period of January 1, 1959, all books and records, stock transfer books, 
minute books, and all books of account, including cash receipts and 
disbursements, bank statements, canceled checks, ledgers, memora- 
dums, correspondence files, and any and all other related records and 
documents, including corporate tax returns for the following corpo- 
rations : Powers Trucking Co., Aggregate Transport Co., Ham Trans- 
port Co., M & G Trucking Co., Enterprise Equipment and Leasing 
Co. 

In addition thereto, to produce any and all records of each of the 
above corporations relating to transactions with or on b?half of labor 
unions and/or labor union officials during the period aforesaid. 

The Chair presents this subpena to you and asks if you recognize 
it as the subpena served upon you. 

(Document handed to the witness.) 

(Witness conferred with his counsel.) 

The Chairman. Do you recognize that as the subpena that was 
served on you ^ 

(Witness conferred with his counsel.) 

Mr. McIMaster. Yes, Senator ; it was served on me. 

The Chairman. You have already been interrogated about some of 
those records. 

Til is subpena may be printed in the record at this point in full. 

(The subpena referred to follows:) 

United States of America 

Congress of the United States 

Lr-4648 

To Roland McMaster, as an oflcer of the follotving companies: Powers Truck- 
ing Co., Aggregate Transport Co., Ram Transport Co., M d G Trucking Co., and 
Enterprise Equipment and Leasing Co., Wixom, Michigan, Greeting: 

Pursuant to lawful authority, you are hereby commanded to appear before 
the Senate Select Committee on Improper Activities in the Labor or Management 
Field of the Senate of the United States forthwith, at their committee room, 101 
Senate Office Building, Washington, D.C., then and there to testify what you 
may know relative to the subject matters under consideration by said commit- 
tee, and to produce duces tecvim pursuant to the schedule hereto annexed and 
made a part hereof. 



15982 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Hereof fail not, as you will answer your default under the pains and penalties 
in such cases made and provided. 

Given under my hand, by order of the committee, this 19th day of July, in 
the year of our Lord one thousand nine hundred and fifty-eight. 

(Signed) John L. McCleixan, 
Chairman, Senate Select Committee on Improper Activities in the Labor or 
Management Field. 
Production of these records at Washington, D.C., will be waived if they are 
made available immediately at Detroit, Michigan. 

SCHEDULE A (L-464 8) 

To produce duces tecum, for the period January 1, 1949 to date, all books and 
records, stock transfer books, minute books and all books of account, including 
cash receipts and disbursements, bank statements, cancelled checks, ledgers, 
memoranda, correspondence files, and any and all other related records and 
documents including corporate tax returns for the following corporations : 

1. Powers Trucking Company 

2. Aggregate Transport Company 

3. Ram Transport Company 

4. M & G Trucking Company 

5. Enterprise Equipment and Leasing Company 

In addition thereto, to produce any and all records on each of the above cor- 
porations relating to transactions with or on behalf of labor unions and/or labor 
union officials during the period aforesaid. 

SERVICE 

July 23, 1958. 
I made service of the within subpena by delivering personally a copy to the 
within-named Holland McMaster, at 2741-Trumbull, Detroit, Mich., at 9 : 35 
o'clock a.m., on the twenty-third day of July, 1958. 

V Signed") Joseph F. Mahee. 

The Chairman. Have you complied with that subpena in that you 
delivered the records called for or produced them as called for? 

(Witness conferred with his counsel.) 

Mr. McMaster. Mr. Kennedy, all the things asked for in the sub- 
pena that were in existence at the time of the issue of the subpena 
are in the hands of the committee, to the best of my knowledge and 
belief. 

The Chairman. You state that you have not withheld any of those 
records ? You state that under oath, do you ? 

Mr. McMaster. Yes, I do. 

The Chairman. You have not concealed or withlield any of those 
records from the committee ? 

(The witness conferred with his counsel.) 

Mr. McMaster, I have not. 

The Chairman. All right. Proceed, Mr. Kennedy. 

Mr. Kennedy. The same situation exists, Mr. Chairman. 

I wonder if we could make arrangements for a consultation with the 
accountant. We have to try to deterniine where these books and 
records have gone to. 

The Ciiairjvean. Who is yowv accountant ? 

(Tlie witness conferred with his counsel.) 

Mr. Kennedy. I will say this: When our investigator talked to 
your wife, she told the investigator that she was not pennitted to 
turn over the books and records because of j'our being investigated; 
that Mr. George Fitzgerald had told her that she was not to turn over 
the books and records. 

(The witness conferred with his counsel.) 



IMPROPER ACTIVITIES IN THE LABOR FIEI/D 15983 

The Chairman. Who is your accountant, so we can confer with 
him? 

Mr. McMastek. Mr. Lew Kosen. 

Tlie Chairman. Is there anything further? 

Senator Ervin. 

Senator Ervix. Did I undei-stand your correctly when I under- 
stood you to testify that you honestly believed that it might tend to 
incriminate you in the commission of some criminal ofl'ense if you 
admitted that you were married to your wife? 

(The witness conferred with his counsel.) 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Senator ER\aN. I will leave it up to you to answer her when you get 
home. 

That is all. 

Mr. Kennedy. JSIr. Chairman, there are just two other matters. 

You were one of the business agents that supposedly or allegedly 
loaned Mr. Hoffa $1,000 in 1953; is that correct? 

(Tlie witness conferred with his counsel.) 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 
\Mr. Kennedy. Did you in fact advance him the $1,000? 

Mr. McMaster. I respectfully decline to answer the question because 
I lionestly believe my answer might tend to incriminate me. 

Mr. Kennedy. Mr. jNIcMaster, is it also correct that you have a 
$5,000 loan outstanding from the Teamstei^ Union, Local 299, on 
whicli you pay no interest at the present time? 

(The witness conferred with his counsel.) 

Mr. Kennedy. Is that correct ? 

(Tlie witness conferred with his counsel.) 

Mr. McMas'tor. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. When I interviewed you out in Detroit a year ago, 
you made that statement, but you also made a statement that you had 
no hnancial interests in any outside businesses other than your farm 
and your horses. That statement evidently was not correct, because 
we have found you have a financial interest in these various trucking 
companies. 

I wonder if the statement about the $5,000 loan is correct. 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Could you tell the committee how you were able to 
obtain this loan without paying any interest, this $5,000 loan? 

Mr. Mc]VL\STER. Mr. Kennedy, I respectfully decline to answer 
because I honestly believe my answer might tend to incriminate me. 

Mr. Kennedy. Did Mr. Hoffa know that you had these outside 
financial interests in these trucking companies? 

(The witness conferred with his counsel.) 

Mr. McMaster. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. That is all, Mr. Chairman. 

The Chairman. Are there any further questions of this witness? 

The witness, Mr. Maher, testified with respect to the articles of 
incorporation of Ram Transport, Inc., the Enterprise Equipment & 



15984 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Leasing Co., and Reed Transportation Co. The copies of the articles 
of incorporation to which he testified, in the order I have named them, 
may be made exhibits Nos. 215A, 215B, and 215C. 

(Documents referred to marked "Exhibits 215A, 215B, and 215C," 
for reference and may be found in the files of the select committee.) 

The Chairman. Is there anything further? 

All right, sir. You may be excused. 

The committee will stand in recess until 2 o'clock, 

(Whereupon, at 12 : 40 p.m., the committee recessed, to reconvene 
at 2 p.m., the same day.) 

(Members of the select committee present at the taking of the recess 
were Senators McClellan and Ervin.) 

ArTERNOON SESSION 

The Chairman. The committee will be in order. 

(Members of the select committee present at the convening of the 
afternoon session were Senators McClellan and Ervin.) 

The Chairman. Call tlie next witness. 

Mr. Kennedy. Mr. Allen Dorf man. 

The Chairman. Do you solemnly swear that the evidence you shall 
give before this Senate select committee shall be the truth, tlie whole 
truth, and nothing but the truth, so help you God? 

Mr. Doreman. I do. 

TESTIMONY OF ALLEN DORFMAN, ACCOMPANIED BY COUNSEL, 
STANFORD CLINTON 

The Chairman. State your name, your place of residence, and your 
business or occupation. 

Mr. DoRFMAN. Allen Dorfman, 1268 Sheridan Road, Highland 
Park, 111. ; insurance. 

The Chairman. You are in the insurance business ? 

Mr. Dorfman. Yes, sir. 

Tlie Chairman. I believe you testified before the committee pre- 
viously ; have you ? 

Mr. Dorfman. Yes, sir. 

The Chairman. All right, Mr. Kennedy, you may proceed. 

I beg your pardon, Mr. Counsel 

Mr. Clinton. My respects, Mr. Chairman. My name is Stanford 
Clinton, and I am an attorney at law, licensed to practice in the State 
of Illinois, and my office is at 134 North La Salle Street, Chicago, 
111. 

Mr. Chairman, I should like to inquire, or at least present a ques- 
tion for your consideration, if I may. 

The Chairman. All right, Mr. Counsel. 

Mr. Clinton. I would like to ask — or may I put it this way — it is 
my understanding, that the Northeastern Life Insurance Co. under 
date of October 27, 1958, presented for filing with the committee a 
leport and analysis of the insurance coverage for the Teamstei-s which 
was underwritten or written through Mr. Dorfman's agency. 

I would like to inquire if it is appropriate and proper as to whether 
or not the document has been received and is a part of the record 
or has been rejected. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15985 

Tlie Chairman. It has not been made a part of the record, I know. 

Mr. Kennedy. The document has been received, Mr. Chairman. 
The president of the company has been called to testify. The docu- 
ment that was received has some major errors in it, and it was felt 
that the way to handle the matter was to have a witness from the 
company itself testify. 

The Chairman. In other words, the document will likely be a mat- 
ter of evidence before tlie liearin^s are completed and possibly there 
will be some interrogation with respect to the accuracy of information 
the document contains. 

Mr. Clinton. Thank you, Mr. Chairman, 

Mr. Kennedy. Mr. Dorfman, when did you begin your insurance 
business ? 

Mr. Dorfman. I claim my privilege under the fifth amendment to 
the Constitution. 

The Chairman. What privilege do you refer to, please? 

Mr. Dorfman. The fifth amendment to the Constitution. 

The Chairman. Do you honestly believe that if you answered that 
question truthfully that a trutliful answer might tend to incriminate 
you? 

Mr. Dorfman. Yes, sir. 

The Chairman. Proceed. 

]\Ir. ICennedy. Mr. Chairman, I understood that the witness, and 
maybe I misunderstood, would answer questions dealing with the es- 
tablishment of the insurance business, and that is why he was called 
as the first witness to give the information regarding the establish- 
ment of the insurance business and liow Mr. Dorfman came to be the 
broker for the Central Conference of Teamsters Welfare and Pension 
Fund. 

Will you tell us any information about that? 

(The witness conferred with his counsel.) 

Mr. Clinton. ^lay we hear that question, Mr. Chairman ? 

The Chairman. The first question ? 

A[r. Clinton. The last statement of Mr. Kennedy. 

Mr. Kennedy. I had understood that the witness would answer 
questions regarding the establisliment of his insurance business and 
how he came to liecome the broker for the insurance of the Central 
States Health and Welfare Fund. 

Would you tell us how you came to become the broker for that in- 
surance fund ? 

jNIr. Dorfman. I claim my privilege under the fifth amendment to 
the Constitution. 

Mr. Kennedy. This of course is another problem in the document 
that was submitted to the committee, l^ecause that document went into 
some detail as to how Mr. Dorfman became the broker for this fund, 
and this is an extremely important matter, and a matter that we will 
have some further testimony on today. 

That is why I had hoped that we would get some first-hand infor- 
mation from Mr. Allen Dorfman also. 

Would you tell us anything about how the insurance happened 
to be given oi- how you happened to become the broker for that 
insurance? 

Mr. Dorfman. I claim my privilege under the fifth amendment to 
the Constitution. 



15986 IMPROPER ACXmTIES IX THE LABOR FIELD 

Mr. Kennedy. Would you tell us how nuich money you have re- 
ceived out of that insurance fund ? 

Mr. DoRFMAN. I claim my priA^lege under the fifth amendment to 
the Constitution. 

Mr. Kennedy. Mr. Chairman, in that case I would like to call as 
a witness the member of the staff who will place in the record the 
documents showing when Mr. Dorfman went into the insurance busi- 
ness, and how he came to receive this insurance from not only the 
Central States of the Teamsters but also from local 1031 of the Elec- 
trical Workers. 

The Chairman. Do I understand that union funds or pension and 
welfare funds of union members are involved in this inquiry ? 

Mr. Kennedy. That is correct, Mr. Chairman. 

The Chairman. Mr. Dorfman is in the role of a businessman that 
has been recipient of some of those funds in a business transaction ? 

Mr. Kennedy. Yes, he has been. There has been some $96 million 
"worth of premiums that have been paid by the Central Conference of 
Teamsters and the Michigan Conference of Teamsters. 

The Chairman. To the Dorfman firm ? 

Mr. I^nnedy. To the insurance company, for which Allen Dorf- 
man is the broker. 

The Chairman. That money passed through his hands. 

Mr. Kennedy. We will show, Mr. Chairman, how much of the 
money passed through his hands. He was the one who handled it. 

The Chairman. Mr. Dorfman, apparently you are a businessman. 
It is not infrequent, as you probably have observed yourself, that we 
get certain hoodlums and racketeers and gangsters and thugs and 
crooks and underworld characters, the scum of humanity in here, in 
connection with some labor activities, that take the fifth amendment. 
They can't talk about their affairs. 

But it is certainly not a pleasant experience to find businessmen 
handling large sums of money belonging to union members, or derived 
from dues of union members, paid into a trust fund or a fund for 
their benefit, or to service the operations of their union — it is not a 
pleasant thing or a pleasant experience to find a businessman involved 
in transactions of that nature w^ho finds himself in a situation where 
he cannot answer questions regarding his business relations with a 
union or with one of its trust funds without finding that to answer 
truthfully he might incriminate himself. 

Do you want to leave that impression here and make that statement 
that you cannot answer these questions about the organization of your 
company and how you happened to get this account ? 

Do you want to leave the statement under oath here that you can't 
answer those questions truthfully without the risk of incriminating 
you ? Is that what you want to do ? 

( The witness conferred with his counsel.) 

Mr. Dorfman. Senator, these questions might tend to incriminate 
me. 

The C^jiAir.TMAN. You would know better than I. If you state 
under oath that you honestly believe that a truthful answer to them 
might incriminate you, then I shall respect your judgment in the 
matter. 

Mr. Dorfman. [They might tend to incriminate me. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15987 

The Chairman. I said that, and that is what I understand you are 
saying, to answer these questions truthfully your answer might tend 
to incriminate you ; is that correct ? 

Mr. DoRFMAN. Yes, sir. 

The Chairman. All right. Proceed. 

Mr. Kennedy. Mr. Chairman, we will have to recall Allen Dorf- 
man, but I would like to put the evidence in first. 

The Chairman. Mr. Dorfman, you sit right behind there where 
you can hear the witnesses and we are going to put on the testimony 
for your information, and edification possibly. 

Bring on the witness. 

Mr. Kennedy. First I would like to call Mr. Martin Uhlmann. 

The Chairman. Mr. Uhlmann, will you come around, please. 

Mr. Kennedy. I might say before Mr. Uhlmann is called, that this 
has been probably the most difficult investigation that the committee 
has conducted. We have been working on it for a period of approxi- 
mately a year and a half. The financial manipulations of Mr. Allen 
Dorfman and his father, Mr. Paul Dorfman, together with some of 
the officials of the Teamsters Union, are extremely complicated and 
it has taken a great deal of time to ti*y to even make it as simple as 
we hope it will be during the next day and a half. 

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. Uhlmann. I do. 

TESTIMONY OF MARTIN S. UHLMANN 

The Chairman. State your name, your place of residence, and your 
present employment. 

Mr. Uhlmann. My name is Martin S. Uhlmann, and I live in 
Arlington, Va., and I am a member of the staff of the Senate select 
committee. 

The Chairman. How long have you been a member of the staff? 

Mr. Uhlmann. A vear and a lialf . 

The Chairman. All right, Mr. Kennedy, proceed. 

Mr. Kennedy. You have been working on this investigation during 
tliat i^eriod of time? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. Now, Mr. Uhlmann, will you first give the committee 
just a little background as to the kind of insurance that is handled and 
w hose insurance we will be talking about, and the part that the Allen 
Dorfman plavs in that insurance and what company he does the work 
for. 

Mr. Uhlmann. Well, we have found that some 98 percent of the 
iiisui'aiu'e written by the Dorfman agencies related to group welfare 
iiisiii'ance for hibor unions. Over the years, from the time he entered 
tlie business in 1949 up until a recent date, the premiums from this 
source have aggregated in excess of $98 million. 

Mr. Kennedy. What are the major sources for those premiums? 

Mr. Uhlmann. Tlie major sources or the principal source has been 
ilie Central States Drivers Council Health and Welfare Fund on 
w hi ell the premiums alone over the years amount to $60 million. 



15988 IMPROPER ACTIVITIES IX THE LABOR FIELD 

Mr. Kennedy. How about the Michigan conference ? 

Mr. Uhlmann. On the Michigan conference, the premiums have 
aggregated about $26 million. 

Mr. Kennedy. What is the next largest ? 

Mr. Uhlmann. The next largest is the local 1031 of the Inter- 
national Brotherhood of Electrical AVorkers, and they have aggregated 
a little over $8 million. 

Mr. Kennedy. AVhich makes a total of approximately $94 million ? 

Mr, Uhlmann. Yes, it does, or a little better than 95 percent of the 
total group welfare insurance written through the Dorfman agency. 

Mr. Kennedy. Total of all of the premiums that they have written 
insurance for has been some $98 million; is that right? 

Mr. Uhlmann. The total premiums, yes. 

The Chairman. When was this company organized, or when did it 
come into being ? 

Mr. Uhlmann. In Januaiy of 1949. 

The Chairman. Is this the total amount of premiums that liave 
been paid to this company, $98 million ? 

Mr. Uhlmann. It is the amount of premiums that has been paid to 
or through this company, but nearly all of it, so far as we could estab- 
lish, has found its way ultimately into the hands of the insurance 
underwriter. There has always been one insurance underwriter for 
the Dorfman insurance enterprises. 

Mr. Kennedy. What is the name of the insurance underwriter? 

Mr. Uhlmann. At the present time it is called Northeastern Life 
Insurance Co. of New York, and it has gone through a series of 
changes. 

Mr. Kennedy. Would you give the name that it had originally ? 

Mr. Uhlmann. Initially the name was Union Casualty Co. 

Mr. KJENNEDY. How long did it have that name ? 

Mr. Uhlmann. It had that name from 1943 to 1951. 

Mr. Kennedy. 1943 to 1951 it had tlie name of Union Casualty Co.? 

Mr. Uhlmann. Yes, sir; a New York company. 

Mr. Kennedy. How was the name changed in 1951 ? 

Mr. Uhlmann. In 1951, they were authorized to write life insur- 
ance business, and the name was changed to Union Casualty & Life 
Insurance Co. That was in December of 1951, to be precise. 

Mr. Kennedy. For how long did they keep that name ? 

Mr. Uhlmann. Until October of 1956 when the name was changed 
to Mount Vernon Life Insurance Co. 

Mr. Kennedy. How long did they keep that name ? 

Mr. Uhlmann. Until February of 1958 when Mount Vernon Life 
merged with another company called Northeastern Life and the 
merged company or consolidated company adopted the name of 
Northeastern Life Insurance Co. of New York. 

Mr. Kennedy. AYhich is the name it has at the present time? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. "\'\niat has been the relationship between what was 
originally Union Casualty Co., and Allen Dorfman? 

Mr. Uhlmann. Well, in 1946, Allen Dorfman's father, Paul Dorf- 
man, who was then head of the Waste Material Handlers Union, had 
his insurance for that union underwritten by the Union Casualty Co. 
It was then managed and directed almost entirely by a Dr. Leo 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15989 

Pcrlmaii. That arrangement for the underwriting insurance was 
made through Joe Jacobs, a prominent labor attorney in Chicago. 

In 1948, some rather extensive correspondence took place between 
Mr. Jacobs and his law firm in Chicago with Dr. Perlman, in New 
York, which ultimately led to the licensing of Allen Dorfman and his 
getting into the insurance business for the Union Casualty Co., in 
Chicago. 

Mr. Kennedy. "WHiat would be their relationship, and how does that 
w^ork ? 

Mr. Uhlmann. Well, in December of 1948, Allen Dorfman was 
hired by Dr. Perlman to be the general agent for the Union Casualty 
Co. in Chicago, which in a few words meant that all insurance written 
in that area for the Union Casualty would necessarily go through 
Allen Dorfman and from which he would derive a commission. 

Mr. Kennedy. What was that date ? 

^Ir. Uhlmann. December 1948. 

Mr. Kennedy. On that date did Allen Dorfman have a license? 

Mr. Uhlmann. No, sir, he did not. He was hired to be trained in 
the insurance business. 

Mr. Kennedy. How was it that he came about to be selected for 
that position? 

Mr. Uhlimann. ]Mr. Jacobs, the attorney, in the light of his rela- 
tionship with Paul Dorfman, suggested to Dr. Perlman that it might 
be desirable in view of prospective increases in insurance business, 
particularly group insurance business in the INIidwest, it misfht be 
desirable for that companv to establish a branch office in the Middle 
West. 

Mr. Kennedy. Hoav do you know that? 

Mr. Uhlmann. We have correspondence, considerable exchange of 
cori'espondence that seemingly started in March of 1948, and went 
on through the early part of 1949 when the company, the insurance 
agency I should say, in which Allen Dorfman was a stockholder, 
was formed. 

Ml-. Kennedy. Does that correspondence show that Allen Dorfman 
was set up in the insurance business in Chicago through the etl'orts 
of Joe Jacobs, and his father, Paul Dorfman ? 

Mr. TThlmann. I would say without a question it does show that. 

Mr. Kennedy. Now, Mr. Chairman, we have those letters, and I 
have reviewed the correspondence as well and the correspondence in- 
dicates without any question that Mr. Allen Dorfman was set up in 
the insurance business by the efforts of his father, Paul Dorfman, 
and with the help of Joe Jacobs. 

The correspondence indicating that, I believe there are approxi- 
mately a dozen letters; is that right? 

Mr. Uhlmann. More than that. 

The Chairman. How many letters do you have there? 

Mr. Uhlmann. Fifteen. 

The Chairman. Who is that correspondence with, or between? 

Mr. Uhlmann. In the main, from Jacobs to Perlman and from 
Perlman to Jacobs, or Jacobs' law firm which wjis then known as 
Jacobs & Kamin. 

The Chairman. You identify the 15 copies of letters? 

Mr. Uhlmann. Yes, sir. 

36751— 59— pt. 43 4 



15990 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. Are tliey carbon copies or photostatic copies? 

Mr. Uhlmann. They are photostats, in each case. 

The Chairman. The 15 photostatic copies of letters may be made 
exhibit No. 216, and they may be lettered A, B, C, and D, in the order 
of their date. 

(Documents referred to were marked "Exhibits 216-A through 
216-0," for reference and may be found in the files of the select 
committee. ) 

The Chairman. It is those letters now may be referred to and 
excerpts read from them, Mr. Counsel, if you desire to sustain a point 
or make a point with respect to what they contain. 

Mr. Kennedy. We have a memorandum, Mr. Chairman, that sum- 
marizes the pertinent points in each letter. 

The Chairman. The witness may summarize the points in the 
letters. 

Mr. Kennedy. Using the language of the letter, in some cases. 

Mr. Uhlmann. Well, the very earliest letter that we were able to 
locate in the course of this investigation was dated March 26, 1948, 
when Mr. Jacobs wrote to Dr. Perlman to the effect that he and Paul 
Dorfman planned to be in New York on April 12 of that j-^ear and 
that they had several important matters to discuss with hun, Dr. 
Perlman. 

On April 12, Jacobs wrote to Perlman and invited him to have 
breakfast with him and Mr. Paul Dorfman at the Hampshire House 
in New York City. 

On October 2, Jacobs wrote to Perlman again and he said that he 
and Paul Dorfman have commenced what he described as "Operation 
Chicago" and that Paul Dorfman had a department store lined up 
for him. I presume that meant insurance for that department store. 

On October 5, 1948, Perlman wrote to Jacobs and said that he 
would meet with Paul Dorfman and Jacobs in New York City. 

On October 21, 1948, Perlman wrote to Jacobs and enclosed some 
benefits for what he described as "Teamsters Union Chicago." The 
union was not identified. 

On November 17, 1948, Perlman wrote to Allen Dorfman, and this 
is the first letter we could locate of correspondence between Perlman 
and Allen Dorfman. There Perlman said that he planned to be in 
Chicago and asked him to arrange for an appointment with his father, 
Paul, because a meeting would be of "mutual advantage" to them. 

Later that month the law firm of Jacobs & Kamin wrote to Dr. 
Perlman and said that the law firm was active on a program previ- 
ously outlined in other correspondence and that they had made ar- 
ran<remeiits for filing Allen's application that day. 

The Chairman. Does it identify the application: application for 
what? 

Mr. Uhlmann. Application for a license in the State of Illinois, an 
insurance license. 

In the same letter, I might say, it was stated that TTnion Casualty 
was asked to file an application" in Allen Dorfnum's behalf since it 
was a requirement of law by the State of Illinois. 

()n November -'50, tlie following day, Perlman wi-ote to tlie law firm 
f)f Jacobs & Kamin, telling fliom that the request for the license had 
gone forward to Springfield, 111., tliaf dav. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15991 

On December 13, 19-18, Perlman again wrote to the law firm con- 
firming that his company would sign a general agency agreement with 
Allen Dorfman's company, by which he would be appointed as the 
exclusive general agent for Union Casualty in Chicago. 

On December 30, 1918, Perlman wrote to Allen Dorfman and con- 
firmed the fact that he had appointed him to head the general agency 
in Chicago, effective January 3, 1949, at a salary of $100 a week. 

On February 23, 1949, Dr. Perlman wrote to Allen Dorfman stat- 
ing that he wanted to meet with Allen in Detroit to conclude some 
business on a Teamsters group which was not identified by name. 

On March 10, 1949, the Union Casualty Co. sent a letter tx) Mr. 
Allen Dorfman in which they enclosed his temporary license. 

That, sir, is the end of the correspondence. 

Mr. Kennedy. Now, this is of extreme importance for a number of 
reasons, one of which is the fact that Paul Dorfman and xVllen Dorf- 
man have always maintained in the past that Paul Dorfman had 
notliing to do with Allen Dorfman being set up in the insurance busi- 
ness ; is that not correct ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. And this would show clearly, or the correspondence 
would show clearly, that Allen Dorfman received his start initially 
through the efforts of his father, Paul Dorfman, and with the help 
and assistance of Joe Jacobs ; is that right? 

Mr. Uhlmann. The correspondence I read clearly points to that. 

Mr. Kennedy. Mr. Uhlmann, what was the next situation that 
evolved from this ? 

Mr. Uhlmann. On April 29, 1949, Mr. Dorfman received his perma- 
nent license as an insurance agent in the State of Illinois. 

Mr. Kennedy. When did he receive his first insurance? 

Mr. Uhlmann. Just 2 days later, on May 1 of that year. 

Mr. Kennedy. That was the insurance for local 1031 ? 

Mr. Uhlmann. That is right. 

Mr. Kennedy. What did he receive as far as commissions on that 
insurance? 

Mr. Uhlmann. Over the years, he has received a total of $700,000, 
approximately. 

Mr, Kennedy. He has received $700,000 for the handling of that 
insurance ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. For local 1031 ? 

Mr. TThlmann. Yes, sir. 

Mr. Kennfj)y. What percentage commissions did he receive initially 
when he received tliat ? 

Mr. I'hlmann. Initially, for approximately the first 3 years of 
that insurance, he received 10 percent commission from the Union 
Casualty Co., the underwriter, and an additional 5 percent from the 
United Public Service Corp. which was affiliated with the Union 
Casualty Co., making an aggregate of 15 percent. 

Mr. Kennedy. Is that extremely high ? 

Mr. Uhlmann. That is regarded as quite excessive. 

Mr. Kennedy. Excessive? 

Mr. TTHLMANN. Yes, sir. 

Mr. Kennedy. Do you have also some correspondence {Rowing liow 
this insurance for local 1031 Was awarded to Allen Dorfman^ 



/ 
15992 IRIPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Uhlmann. Yes, sir. As a matter of fact, Mr. Darling who 
was head of the union then, and he still is, was questioned about it 
by another committee some few years ago. During the hearing he 
was questioned, I should say, about the events that lead up to awarding 
this insurance. He said that he had discussed the matter with Mr. 
Jacobs, who was attorney for local 1031, and he was the Joe Jacobs 
that I referred to earlier, and he had also discussed it with Mr. Paul 
Dorfman and he tliought that Allen Dorfman was present at the time,, 
and Dr. Perlman, of course, as the vice president of the underwriter^ 
was there too. 

Mr. Kennedy. Would you put the correspondence in the record. 
We have some correspondence indicating how this insurance was 
awarded through Allen Dorfman, and we would also like to have it 
placed in the record for reference. 

The Chairman. What do you have, Mr. Witness, witli respect to 
correspondence on this point ? 

Mr. Uhlmann. Well, on April 27, 1949 

The Chairman. Do you have a number of letters ? 

Mr. Uhlmann. Yes, sir, I do. 

The Chairman. How many ? 

Mr. Uhlmann. Eight letters. 

The Chairman. Between whom ? 

Mr. Uhlmann. There are several people, sir, officials of the insur- 
ance company and Allen Dorfman primarily, almost entirely as a 
matter of fact. 

The Chairman. Those eight letters may be made exhibit 217, and 
they may be further identified in the order of their dates, A, B, C^ 
and so forth. 

(Documents referred to were marked "Exhibits 217A through 
217H," for reference and may be found in the files of the Select 
Committee.) 

The Chairman. Now, you may testify as to excerpts from them if 
you desire. 

Mr. Uhlmann. On April 27, 1949, Dr. Perlman wrote to Frank 
Darling confirming that he would insure the members of local 1031 
effective May 1, 1949. 

On August 24, 1949, Perlman sent his first check for commissions 
to Allen Dorfman in the amount of $1,000 in connection with this 
insurance. 

On September 30, 1949, Dr. Perlman wrote to one of his officei-s 
who was then out of the city, suggesting that he contact Paul Dorf- 
man who was then in St. Paul, Minn., and in so writing he described 
it this way : 

Paul Dorfman proved to be very influential in the AFL and many trades. He 
was also instrumental in tlie materialization of the Electrical Wmicers Brother- 
hood plan. 

On November 9, 1949, Dr. Perlman entered into an agreement with 
Allen Dorfman in relation to the local 1031 insurance and as part of 
this agreement he enclosed a clieck for $700 which he said would 
cover his office rent since Allen Dorfman had not yet apparently at 
that time liad an oflice of his own. 

Dr. Perlman was sending him this $700 in order that he conhl go( 
started by way of paying his rent, and advancing it, and also for 
oflice equipment, as Perlman described it. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15993 

On April 8, 1950, Allen Dorfman wrote to William Smith, one of 
the officers of the Union Casualty Co., pointing out that he had 
talked with Mr. Darling about getting some life insurance for a group 
of members, and that the life insurance at the time was carried with 
another company. He mentioned that Mr. Darling would like to 
turn that business over to him, that is, Mr. Dorfman, as — well, to 
quote it, he says : "As a favor to me." 

lie then suggested that the company try to bid on it with a view 
to having the business transferred to them. 

On November 28, 1949, we find a letter written by the company at 
Mount Vernon. This person that wrote the letter was assistant, then, 
to Dr. Perlman, and he advises the United States Life Insurance Co., 
wliich then was underwriting the life portion of this insurance, to 
address all commimications to their representative who was handling 
•claims, and tliat all such communications be sent to the office of the 
local, that is, Mr. Darling's office. 

So apparently the insurance company itself, from this correspond- 
ence, did not have its own office in the city of Chicago, since it was 
using the facilities of local 1031 for the purpose of handling and 
paying claims. 

Mr. Kennedy. It would indicate even at the time that this insur- 
ance was granted that neither ]Mr. Allen Dorfman had an office nor 
the insurance company had an office in Chicago ? 

Mr. UiiLMANN. Yes, sir; that is correct. 

I have a letter here dated October 9, 1949, written by the United 
States Life Insurance Co. to Mr. Engstrom, who was the claims super- 
visor for the Union Casualty Co. in Chicago, primarily at the time 
handling local 1031 claims. 

This letter was addressed to him at the International Brotherhood 
of Electrical Workers, Local 1031, in the city of Chicago. 

That, sir, completes the correspondence. 

Mr. Kennedy. That was tlie first piece of insurance that they re- 
ceived. What occurred after that, Mr. Uhlmann ? 

Mr. UiiLMANN. Well, beginning with December of 1949, the first 
Teamster group came into the Dorfman company, and that was local 
743, in Chicago. It is still carried by the Dorfmans. 

Mr. Kennedy. Who is the chief official of the Teamsters Union in 
local 743? 

Mr. Uhlmann. Don Peters is head of that local. 

Mr. Ivennedy. Did they also receive the Central Conference of 
Teamsters ? 

Mr. Uhlmann. Yes. That followed in 1950. 

Mr. Kennedy. What was the situation regarding that? 

Mr. Uhlmann. Well, that was rather complex in several respects. 

Mr. Kennedy. We have gone into this to some extent in the hearing 
we held last year; is that right? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. And into some of the correspondence ? 

Mr. Uhlmann. Yes, we have. 

Mr. Kennedy. We can summarize the correspondence we have al- 
ready put into the record and supplement that by whatever other 
information we have. 

This is of extreme importance, Mr. Chairman, because of the 
amount of money that ultimately came out of it and went into the 



15994 IMPROPER ACTIVITIES IN THE LABOR FIELD 

hands of Mr. Allen Dorfman. We will put those figures into the 
record after Mr. Uhlmann finishes his summaiy of the situation. 

Mr. Uhlmann. The Central States, Southeast and Southwest 
Areas Health and Welfare Fund, very likely is one of the very largest 
group welfare and insurance plans in the United States today. It may 
well have been at the time that the insurance Avas awarded, in Maroh 
of 1950. 

We find this 

Mr. Kennedy. What point do you make in summary ? 

Mr. Uhlmann. Well, in summai-y, I should like to say this : That 
I have some 75 documents that have a bearing on the award of this 
insurance that have been assembled from various sources. 

Mr. Kennedy. Wliat do those documents show ? 

Mr. Uhlmann. They show that the insurance was not awarded 
on a real competitive basis. 

Mr. IvENNEDY. Who do they show was responsible for the award- 
ing of the insurance ? 

Mr. Uhlmann. They show that Mr. Hoffa, who was one of the two 
members of the negotiating committee for Central States at the time^ 
and Dr. Perlman, referred to earlier, and possibly Paul Dorfman 
were instrumental in having this insurance awarded to the Union 
Casualty Co., as you pointed out a moment ago, on which the Dorf- 
mans have received commissions over the years. 

Mr. Kennedy. The individual that made the decision for the Cen- 
tral Conference of Teamsters was whom ? 

Mr. Uhlmann. The decision, on paper at least, was made by both 
Mr. Hoifa and Mr. Healy jointly, as chairmen of this negotiating 
committee. 

Mr. KJENNEDY. What does the correspondence show, the letters and 
the documents that you have, as to who was responsible for granting 
the insurance ? 

Mr. Uhlmann. I beg your pardon. The granting of the insur- 
ance was made by a majority vote of the committee of the health and 
welfare fund. 

Mr. Kennedy. And what does it show as far as the one who was 
instrumental in causing this award to be made ? 

Mr. Uhlmann. Mr. Hoffa. 

Mr. Kennedy. And the correspondence and tlie documents show 
that? 

Mr. Uhlmann. Yes. 

]\Ir. Kennedy. And the correspondence and the documents show 
that the award was not made to the low bidder; is that right? 

Mr. Uhlmann. Yes, sir, 

Mr. Kennedy. And that there was collusion between Mr. Hoffa 
and Paul Dorfman in favor of Mr. Allen Doi-fmnn ? 

Mr. Uhlmann. Yes. And Dr. Perlman. 

Mr. Kennedy. There was collusion among Mr. Hoffa, Mr. Paul 
Dorfman, and Dr. Perlman, in favor of Allen Dorfman and Dr. Perl- 
man ; is that correct ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. Was Paul Dorf man's wife involved in this also^ 

Mr. Uhlmann. Yes. 

Mr. Kennedy. She received a certain percentage of the commissions 
that came out of this Central Conference of Teamsters ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15995 

Mr. Uhi.mann. Yes. At the time this insurance was placed, in 
March 1950, the Dorfnians had been operating under a corporate form 
of organization. Later that year they changed their capital structure 
in a manner so as to set up a partnership. 

In the early stages, Allen Dorfman held a one-fourth interest in the 
partnereliip profits, and his mother had three-fourths. Tlien a year or 
so later that was changed to a 50-50 arrangement, which is still in 
effect today. 

Mr. Kenxedy. Who were the trustees of the fund at the time; that 
is, at the time the insurance was awarded ? 

Mr. Uhlmann. At that time there was no trustees as such, but they 
were members of employer and employee committees. But those 
who were instrumental in placing the insurance were Mr. James R. 
Hoffa and Mr. Michael J. Healy ; they were the negotiating committee. 
The Chairman. They later had six trustees; is that right? 
Mr. Uhlmaxn. Three of each. 
The Chairmax. Name them ; labor first. 

Mr. Uhlmaxx. Mr. HofFa, Mr. Healy, and Mr. Gale Murrin; and 
on the employer side there was Mr. Earl N. Cannon, Mr. A. O. Buck, 
and Mr. Cabell Cornish. 

The Chairman. So there were six that participated in or who had 
the authority and duty to participate in and handle this award of 
insurance ? 
Mr. Uhlmaxx. Yes. 
The Chairman. All right. 

Mr. Uhlmax'x\ I should qualify this. There was an employer and 
employee committee to which copies of bids were to be sent. The 
employers' group had a committee of some 20-odd people. If there 
were any labor people on its side, I don't have a list of them. I have 
only the group that comprised the employer committee and there was 
some 22 of those men. 

The Chairmax. Well, the trustees have equal representation, don't 
they, as between employer and employee? 

Mr. Uhlmaxx. I believe that was the case. I am trsnng to make 
the distinction between trustees and the so-called committees. 

The Chairmax'. Who actually made the award of the insurance, the 
trustees or the committee ? 

Mr. Uhlmann. The Negotiating Committee; that is, Mr. Hoffa 
and Mr. Healy. 

The Chairman. They made the award ? 
Mr. Uhlmann. Yes. 
The Chairman. And not the trustees? 

Mr. Uhlmann. Not the trustees. However, the trustees were part 
of the committee. They were just a part of tlie larger committee. 

The Chairman. Well, a man may be a stockholder, of course, and 
also a member of the board. But those representing the stockholders 
in this instance, so to speak, made the award ? 
Mr. Uhlmann. That states it well. 

The Chairman. They had the final authority to make it. Who 
actually made it, controlled it and directed it, may be another thing. 
Mr. Uhlmann. Yes, sir. 
Tlie Chairman. All right. Proceed. 

Mr. IvENNEDT. Can you summarize what all this correspondence 
and memoranda says? 



15996 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Uhlmann. Yes, sir. There were three separate occasions on 
which bid invitations were sent out with respect to this insurance be- 
fore it was awarded. The first bid invitation was dated January 10, 
1950, and was sent to some 40 companies. 

Union Casualty Co. was not included in that list, in the first go- 
around. 

The Chairman. That is the company that Dorf man represented ? 

Mr. UiiLMAN. Yes, sir ; and that is the company that ultimately got 
the insurance. 

The Chairman. It wasn't included in the first list? 

Mr. Uhlmann. It was not included. 

The Chairman. All right. 

Mr. Uhlmann. In the second list, the second bid invitation was 
dated February 4, 1950, and this company was included in the list 
for the first time. 

I didn't mention that the bids in response to the first invitation were 
thrown out on the ground that there was considerable confusion. 
Beyond, that, there was no explanation made. Two days before the 
second bid invitation went forward, and that was dated February 4, 
Allen Dorfman wrote a letter which was introduced in the record 
last September on page 4581 of the transcript, in which he told Dr. 
Perlman that, "Our efforts to land the Central States business will 
be successful." 

That was before the second round invitation went out. 

The Chairman. That was 2 days before the 4th of February 1950 ? 

Mr. Uhlman. Yes, sir. 

In response to the second round, there were some 13 companies 
involved, and again it was stated that because of some confusion and 
because of the fact that some of the bids were too high in relation 
to what the welfare fund was able to pay for this coverage, that still 
another round, or bid invitation, would have to be sent out. 

On the third occasion, the number of companies invited to bid was 
reduced to eight on the ground that they were the eight lowest selected 
out of the 13 that had bid on the second go-around. 

Mr. Kennedy. Go ahead. 

Mr. Uhlmann. In both the second and third bid invitations, there 
were some specifications which are of real interest in that it was indi- 
cated the average age of the union members was 43. The bid invita- 
tion also pointed out that there was to be no change or variation made 
after the bids themselves went forward. However, in the case of 
Union Casualty, when they submitted their final bid, they did not 
correspond to the specifications in the bid invitation with respect to 
the life portion of the insurance in that their bid coverage age 39, 
whereas, their competitors submitted bids on age 43. 

The Chairman. That last round of bids went out on March 7, I 
believe ; is that correct? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. Does the correspondence indicate that Allen Dorf- 
man had discussed this matter with Jimmy Hoffa about putting in a 
bid based upon tlie age of 39 rather than the age of 43 ? 

Mr. Uhlmann. Yes. Allen Dorfman wrote to Perlman on March 
8, 1950, the day after the last bid invitation, was sent out, and that 
letter was introduced in the previous testimony. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 15997 

It said in part that Mr. Hoffa said it would be all right to quote the 
lower rate on the life insurance portion. 

Mr. Kennedy. He also stated, as I remember it, that, however, if 
it was found that the rate turned out to be 43 years instead of 39, 
that the insurance company would have to bear the loss; is that 
correct ? 

Mr. Uhlmann. That is correct. 

Mr. Kennedy. What is the next item? Let's move along and just 
summarize these documents. 

Mr. Uhlmann. We found some evidence that some o:" the bid in- 
formation from competing companies was in the files of the Union 
Casualty Co. 

lilr. Kennedy. Did we find in going through the files of the Union 
Casualty Co. the bids that were put in by the opposition companies, 
is that right, by the competitors ? 

Mr. Uhlmann. Yes, that is right. As a matter of fact, we had 
occasion to correspond with the other companies to establish whether. 
or not they, too, had received any bid information, and we were told 
in each case that they did not. 

Mr. Kennedy. Go ahead. 

Mr. Uhlmann. On one particular occasion. Dr. Perlman, under 
date of ]\Iarch 2, 1950, wrote to the U.S. Life Insurance Co. and 
enclosed a bid from the Pacific Mutual Life Insurance Co., which was 
the lowest bidder, and he inquired of them as to how Pacific IMutual 
was able to bid so low on the life portion, and he wanted them to 
explain in some way that they possibly might as to how they were 
able to do it. 

As a matter of fact, Dr. Perlman used the term "amazing." It is 
very evident that he had this bid information in liis possession before 
the awards were made. 

Senator Ervin. Isn't the Paeific Mutual Insurance Co. one of the 
large, strong insurance companies of the United States? 

Mr. Uhlmann. Yes, sir, they were the low bidder. 

Mr. Kennedy. They were tlie low bidder. But tliey were thrown 
out ; is that correct ? 

Mr. Uhlmann. Yes. At the last hearing, on September 18, 1958, 
Mr. AValker, who is vice president of Pacific Mutual, and who per- 
sonally participated in this bidding at the time, presented an affidavit 
to this committee in which he stated, in transmitting his bid which, 
incidentally, required that it be sealed; that he had discussed the 
matter with Mr. Hoffa, and Mr. Ploffa had pointed out that since 
the company at one time was in some financial difficulty, roughly 15 
years before the bid was being considered, that for that reason they 
were thrown out. 

As indicated by his letter, he only had a minute or two to discuss 
the matter, and he was dismissed. 

Mr. Kennedy. What did he say in the matter? 

Mr. Uhlmann. Well, he asked Mr. Hoffa whether he regarded him- 
self as both judge and jui-y with respect to that situation, and the 
response was "Yes." He then dismissed him, and the Pacific Mutual 
bid was thrown out, even though it was the lowest, as I stated earlier. 

Mr. Ivennedy. At that time, the Pacific Mutual was in far better 
financial status than the Union Casualty Co. ? 



15998 IMPROPER ACTIVITIES IN THE LABOR FIELD 

.•:;;Mr. Uhlmann. Yes. Far superior. There is no real comparison 
between them. 

" Mr. Kennedy. The difficulties that they had had financially Avere 
difficulties that they had had prior to the time the Union Casualty Co. 
was even f oi-med ; is that right ? 

Mr. Uhlmann. That is right. The difficulties dated back to 1936 
and the Union Casualty Co. was formed in 1942; or 1943, I should say. 
, Mr, Kennedy. And the representative of the company said that 
he had only a minute in which to discuss the bid and then he was told 
by Mr, Hoffa that he was dismissed; is that right? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. And he asked Mr, Hoffa if he was both judge and 
juiy and Mr. Iloft'a claimed that he was? 

Mr, Uhlmann. That is correct. 

Mr. Kennedy. And the award was then given to the Union Casualty 
Co.? 

Mr. Uhlmann. Yes, that very day. That was March 15, 1950. 

Senator Ervin. In other words, they went through the form of so- 
liciting bids from a number of insurance companies, and then, appar- 
ently, those who wei'e cliarged with receiving bids, they turned over 
the bids or information about the bids of all the other companies to 
the Union Casualty Co. 

Then, on the final roundup, with a strong insurance company like 
the Pacific Mutual bidding the lowest, they throw out its bid on the 
ground that during the depression, when a large part of the popula- 
tion of the United States were having to beg a nickel to get a cup of 
coffee, that during the depression that they had had some financial 
difficulties. 

They throw out the low bid so that they could award and did award 
the contract to the Union Casualty Co., which was a far weaker com- 
pany than the Pacific Mutual. 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. Do you have the financial status of the Pacific 
Mutual ? 

Mr, Uhlmann. Yes, The latest available information preceding the 
date on which this award was made was for the year 1949, quite 
naturally, and at that time the Pacific Mutual Co. had admitted assets, 
as the term is used in the insurance business, of $376 million. Union 
Casualtv had $768,000. 

The surplus of Pacific Mutual was $12,400,000, as contrasted with 
$105,000 of Union Casualty. 

Mr. Kennedy. And Mr, Hoffa threw out the Pacific INfutual because 
•they were not financially sound, altliougli they were worth $376 mil- 
lion and Union Casualty was worth $768,000, approximately? 

Mr. IThlmann. That is right. Then in the year 1949, the surplus in- 
crease with respect to Pacific INtutual was approximately $1 million 
as contrasted with a $35,000 decrease in the case of T^nion Casualty. 

Aside from tlie financial, tlie major financial dis])arities of the two 
companies, thi^ fact remains that Pacific Mutual, insofar as its ratings 
are concerned by Best's, which is a recognized authority, was certainly 
the more experienced company in this field of welfare insurance at 
that time. 



IMPROPER ACTIVITIES IX THE LABOR FIELD 15999 

Mr. Keninedy. Was there testimony by some of the members of the 
committee, the trustees, before the Hoffman committee, regarding 
the commissions that were to be paid on this insurance? 

Mr. Uhlmann. Yes, there was. I liave it here before me. Before 
that committee some few years back, Mr. Buck was questioned about 
commissions w'ith reference to this particular insurance, and lie said 
this: 

My recollection is tluit the (inestioii was put to Dr. Perlninn whether or not 
jiny commissions were involved, and as I recall his answer was that no com- 
missions were involved. The insurance company was dealing directly with the 
trustees. 

Mr. Kennedy. Was there another trustee who answered the same 

•question? 

Ml". Uhlmann. Yes, Mr. Earl Cannon. He had this to say : 

He said it was his impression that Dr. Perlman told the trustees 

that he had no agency, and that there would be no agency costs, and 

that the trustees would be dealing directly with the insurance com- 

jiany. Mr. Cannon also had this to say : 

I voted against the selection of the company at a meeting of the employers. 

Mr. Kennedy. At that time they received the award from the Cen- 
tral Conference of Teamsters. 

We will go, in a moment, Mr. Chairman, into the fact that they 
did receive a brokerage fee, they did receive commissions. 

I would like to have you finish up with the awarding of the in- 
-urance and tell us what happened with the Michigan Conference 
of Teamsters. 

Have you finished with the Central Conference award? 

]Mr. Uhlmann. Well, yes ; I have. 

Mr. Kennedy. Now, the Michigan Conference of Teamsters had 
had a different insurance company ; is that right ? 

Mr. Uhlmann. Yes. The Michigan Conference of Teamsters wel- 
fare fund was set up in January of 1949, and their first insurance, 
tliat is, group welfare insurance, was underwritten by the Continental 
Assurance Co. in June of 1949. 

The Chairman. Mr. Witness, you testified regarding a number of 
documents you had to substantiate your testimony with reference to 
the Central Conference, I believe ; is that correct ? 

Mr. Uhlmann. Yes. The Central States Conference. It is the 
Central States Southeast and Southwest Areas Health and Welfare 
Fimd. 

The Chairman. You have concluded your testimony with respect 
to that as of the moment ? 

Mr. Uhlmann. Yes, I believe I have. 

The Chairman. You referred to a number of documents ? 

Mr. Uhlmann, Yes. 

The Chairman. Have you now delivered those to the clerk, the 
documents that you referred to ? 

Mr. Uhlmann. Yes. 

The Chairman. What are they marked ? 

Mr. Uhlmann. They are marked the documents identified with the 
Central States award. 

The Chairman. Those documents may be made exhibit No. 218 in 
bulk. 



16000 IMPROPER ACTIVITIES IN THE LABOR FIELD 

(The documents referred to were marked "Exhibit No. 218" for 
reference and may be found in the files of the select committee.) 

The Chairman. Now you may proceed with the other. 

Mr. Uhlmann. The Michigan Conference 

Mr. Ejennedy. Just a moment. That was called Central States at 
that time? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. What is it called now ? 

Mr. Uhlmann. Central States, Southeast and Southwest Areas 
Health and Welfare Fund. 

The Chairman. In other words, the name has been changed? 

Mr. Uhlmann. Well, there has been a slight change in that. An 
additional area was added after it was initially set up. It was initially 
the Central States Drivers Council Health and Welfare Fund, and' 
then they added the Southeast and Southwest areas, as I recall. 

The Chairman. All right. 

Mr. Uhlmann. Shall I proceed with the Michigan Conference of 
Teamsters ? 

The Chairman. Proceed with the Michigan conference ; yes. 

Mr. Uhlmann. The Michigan Conference of Teamsters Health and 
Welfare Fund was established on January 25, 1949, in the city of 
Detroit. 

The following day Mr. Hoffa wrote a letter to Dr. Perlman, on Jan- 
uary 26, 1949, in which he inquired of him as to what benefits could 
be offered for a particular premium, which he stipulated in his letter. 

On February 2, 1949, Perlman responded to that letter of Mr. Hoffa. 
In March of 1949, a trust agreement, setting up the Michigan Confer- 
ence of Teamsters Welfare Fund was drawn up and adopted, at which 
time Frank Fitzsimmons was appointed as the labor trustee. He is 
an employee of local 299 in Detroit. And Mr. J. Howard Minnich was 
trustee for the employers. There were only two trustees on that fund. 

On January .'](), 1951, the administrator for the Michigan Confer- 
ence Welfare Fund addressed a communication to Mr. Allen Dorfman 
in which he pointed out the various policies that they had with the 
Continental Assurance Co., which had been in effect since June 
1949, and also indicated the amount of premium that was being paid 
with reference to each of those policies. 

Another communication was addressed by the administrator of that 
fund to Dr. Perlman covering the same subject. On March 2, 1951, 
the actuary for the United States Life Insurance Co. — I bring this 
company into the picture only because at the time that this insurance 
was being negotiated, Union Casualty was not licensed to write life 
insurance and, consequently, its insurance coverage was confined to 
underwriting accident and health coverage only. 

For that reason, a life insurance company, of course, liad to be 
selected to cover that feature of the insurance, and Perlman worked 
out an arrangement with the United States Life Insurance Co. 

Now, on March 2, 1951, the actuary for this company addressed 
a letter to the president of that company in Avliich he stated that Dr. 
Perlman told him that it was his plan, that is, Perlman's plan, to 
establish a branch office of the Michigan Conference of Teamsters 
Wclfnre Fund in Clhicago, and tlmt in tliat way they would be able 
to write the insurance in the State of Illinois. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16001 

I should mention at this point that under the trust agreement, the 
trustees were obligated to develop and establish a plan of insurance, 
and that their headquarters were in the State of Michigan, and spe- 
cifically in the city of Detroit. 

To justify the position that they had taken in relation to having this 
insurance written in Illinois, Dr. Perhnan, of course, said also that 
the premiums would be collected in Illinois, and that there would be 
no solicitation for this life insurance business in the State of Michi- 
gan, masmuch as Dr. Perhnan or United States Life Insurance Co. 
itself, incidentally, were not licensed to either solicit or write life 
insurance business in the State of Michigan at the time. 

For that reason, since they were licensed to do so in Illinois, the 
plan was to have it done in that State, if possible. That contract for 
the insurance was signed on March 8, 1951, effective with the policy 
year beginning April 1, 1951. 

Mr. Kennedy, What happened was that the Michigan Conference 
of Teamsters had given the aw^ard to another insurance company, 
Continental Assurance ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. And they had communicated with the Michigan Con- 
ference of Teamsters just prior to March of 1951 and stated to them 
that they could give more benefits and lower the premium rate; is 
that ri'riit? 

Mr. Uiilmann. Yes. 

Mr. Kennedy. During this period of time there were maneuverings 
going on, correspondence and letters back and forth, indicating that 
the Dorfman group was expecting to get this insurance of the Michi- 
gan Conference of Teamsters ; is that right ? 

Mr. Uiilmann. That is correct. 

Mr. Kennedy. And there was a problem because the insurance com- 
pany w^as not established to do business in Michigan, so they were 
going to try to arrange it so that they could work out of Illinois ; is 
that correct ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. And these maneuverings were going on all the time 
the other insurance company had the contract ? 

Mr. Uhlmann. That is correct. 

Mr. Kennedy. Then the award was given to the Dorfman group on 
March 8, 1951 ; is that right? 

Mr. Uhlmann. That is right. 

Mr. Kennedy. Mr. Hoffa took it away from the Continental As- 
surance Co. and gave it to the Dorfman group ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. Tliat is on IMarch 8, 1951. Wlien did the Dorfman 
group submit their bid on the insurance ? 

Mr. Uiilmann. Well, specifically. Dr. Perhnan submitted a bid to 
the Michigan Conference of Teamsters Welfare Fund the following 
day, March 9, 1951. 

Mr. Kennedy. So they received the award on March 8, 1951, and 
didn't submit their bid until March 9, 1951 ? 

Mr. Uiilmann. Yes, sir. 

Senator Er\^n. You know it is a fact that virtually every State in 
the Union has certain standards by which it has devised to regulate 
the doing of insurance business within the State, and that those 



16002 IMPROPER ACTIVITIES EST THE LABOR FIELD 

standards are devised by the State to try to protect its citizens, to ma:ke 
it certain that they place insurance in the companies which are able 
to perforin the contract, don't you ? 

Mr. Uhlmann. Ybs, sir. 

Senator Ervin^. And this company that was awarded this contract 
had been unable, or at least had not obtained authority to do business 
in the State of Michigan? 

Mr. Uhlmann. Yes, sir. 

Senator Ervin. So in order that this company, whicli had been 
unable to obtain authority to do business in the State of Michigan, 
might have this contract, they even moved the place for the making 
of the contract from the headquarters of the Teamsters in the State 
of Michigan to an office in Chicago, or proposed to do so ? 

Mr. Uhlmann. I would say proposed to do so, since we found no 
evidence that tlie Michigan Conference of Teamsters Welfare Fund 
had, in fact, ever establislied an office in the State of Illinois, and in 
the light of the trust agreement there is a very grave question as to 
whether tliere was any authority for that w^elfare fund to have a 
branch office anywhere outside of the State of Michigan. 

Senator Ervin. Certainly the State of Michigan would be willing 
for anj^ insurance company to do business in the State of Michigan 
if it were able to come up to Michigan requirements. 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. Did they ever meet the requirements ? 

Mr. Uhlmann. Yes. The United States Life Insurance Co. 

Mr. Kennedy. Did they meet the requirement at the tune of the 
award ^ 

Mr. Uhlmann. Well, let me put it this way : For some reason or an- 
other, and the reason is not known to me, they were not licensed to 
write life insurance in Michigan until 1952. 

Mr. Kennedy. They received the award in March of 1951 ? 

Mr. Uhlmann. Tliat is right, at a time when they were not licensed 
in Michigan. 

Mr. Kenned^'. There had been some dissatisfaction, had there not, 
with the way that Dr. Perlman's group, the Dorfman's group, was 
handling insurance for the Central Conference of Teamsters; is that 
right? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. One of the points that was raised was the high re- 
tention rate. In fact, Mr. Hoffa raised that question himself, did lie 
not? 

Mr. Uhlmann. Yes, sir; he did. 

Mr. Kennedy. Nevertheless, despite that fact tlie contract was 
signed for the Micliignn Coiifer(Mice of Teamsters a])plying the same 
terms as had been applied to the Central Conference of Teamsters? 

Mr. Uhlmann. That is riglit. 

Mr. Kennedy. Now, I would like to place in the record tlie otlier 
insurance that the Dorfman group lias received, a list of Doi-fnian 
Teamstei*s groups. 

The CuAiKisr.vN. Ibn-e you placed in rhc i-ccord oi- made e.\hii>irs 
any docunuMifs you have su])i)()i't ing yoni- (estiniony wi'ii i-efei-enoe to 
the Michigan con fei'ence? 

Mr. Uhlmann. Well, I would like to add tins: .^ s I. stated earlier,, 
one of the features for justifying the writing of (ho iusurtiiirt^ c<iii- 



IMPROPER ACTIVITIES IN THE LABOR FIELD 



16003. 



tract in Illinois was that the insurance preminms on the life insur- 
ance would be mailed directly or paid from Chicago. "We have copies 
of letters indicatiuj^ that the premiums were sent directly from Deti-oit 
to the insurance company in New York. 

The CiiAiR.MAX. What I would like to do is for you to assemble 
there in bulk all of the documents you have now suppoi'tiiifif the testi- 
mony that you have given regarding the Michigan conference, and 
let those be made exhibit 219 A, 13, and so foi'th, in the order of their 
dates. 

(Documents were marked "Exhibits 219 A, et seq.", for reference 
and may be found in the files of the select committee.) 

The Chairman. Now then, you may proceed. 

Mr. Kexnedy. Mr. Chairman, those are the chief insurance cover- 
ages that we are going to discuss, but the Teamsters have given the 
Dorfman Insurance Agency other local unions, and I would like to 
have them placed in the record, and they include various unions that 
go through the Dorf mans. 

The Chairman. Do you have a list in the course of your investiga- 
tion, or have you discovered other locals of the Teamster's Union whose 
insurance goes through the Dorfman agency ? 

Mr. Uhlmann. Yes, sir. 

The Chairman. Do you have a list of them ? 

Mr. Uhlmann. I do. 

The Chairman. Have you checked that list for accuracy ? 

Mr. Uhlmann. Yes, sir. 

The Chairman. All right, that list may be printed in the record 
at this point. You may supply it and it will be printed in the record 
rather than made an exhibit. 

(The document referred to follows:) 

List of Dorfmans' Teamster groups 
Northeastern Life Insurance Co. of Republic National Life Insuamce Co. 



New York 

Local 743 

Local 580 

Local 405 

IxK-al 713 

Local 447 

Loc-al 610 

Local 688 

Local 876 

Michigan Conference 

Central States 

Contract Steel Carriers 

J. L. Keeshin Transport 

Tot.ll. 12 



Local 781 

Local 86 

Local 21 

Local 726 

Local 608 

Local 659 

Local 335 

Joint Council 37 * 

Local 90 

Local 206 

Group Participation 

Trustees, Inc. (Riggers & 

chinery Movers, Local 575) 
Joint Council 82 
LfK-al 95 

Total, 13 



Ma- 



Mr. Kennedy. Thei-e are three important matters in this, Mr. 
Chairman. One is to determine what the Dorfmans got out of this 
in the Avay of compensation, and then of course, how that cost the. 
Teamster IJnion members' money, and cost the Teamsters TTnion mem- 
bers' benefits. Then the third matter that we will be going into sub- 
sequently is what was the quid pro quo, as far as Mr. Jinuny Holla was 
concerned, for the awarding of the contract. "\Ve have attempted to 



1 Offlt-eworkers eiiiploycfl bv 15 1<k-;i1s : 80!). 57. 58. 162. 20f!, 223, .•?21, 305. 501. ofiO. (J5tj. 
689. 883. 000. 911. 



16004 



IJMPROPER ACTIVITIES IN THE LABOR FIELD 



develop that there was collusion about the awarding of the contract 
in the Central Conference of the Teamsters and the Michigan Con- 
ference of Teamsters, and those who were in charge understood that 
there were not going to be any commissions paid or charges paid in 
connection with these contracts. 

I would like to ask Mr. Uhlmann to testify as to how much money 
has been paid to the Dorfmans in the form of commissions and service 
fees, and then I would like to call a witness, Mr. Chairman, from 
the New York State Insurance Department and have him testify as 
to what these figures mean and what an ordinary broker would have 
received under a similar circumstance. 

The Chairman. What have you there now before you, and what 
are you going to testify to? These are the total amount of receipts 
or remunerations or commissions or whatever it is that has gone to 
the Dorfmans from this insurance. 

Mr. Uhlmann. Yes, sir. 

The Chairman. Do you have a chart of it, or have you made out a 
statement of it? 

Mr. Uhlmann. Yes, sir. 

The Chairman. That statement may be printed in the record at 
this point as a part of the record, and now you may testify about it. 

( The chart referred to follows : ) 

Central States, Michigan Conference, and Local 1031 commissions and service 

fees paid to Dec. 31, 1958 





Central States 


Michigan 


Oonference 


Local lOil 


Policy year ' 


Commis- 
sions 


Fees 


Commis- 
sions 


Fees 


Commis- 
sions 


Fees 


1949-50 










$32, 727. 70 
121,672.42 
107, 505. 56 
113,801.14 
115,895.34 
25, 377. 74 
22, 790. 26 
24, 205. 95 
25, 164. 30 
8, 460. 62 




1950 51 


$44, 975. 79 
82, 627. 28 
145, 959. 17 
200, 700. 75 
71,401.57 
92, 554. 73 
111,377.52 
131,235.67 
91,827.67 


$7, 328. 08 

29,611.44 

16, 218. .55 

73, 029. 06 

137, 735. 83 

188, 875. 88 

255, 752. 26 

300, 263. 02 

101,918.81 








1951 52 . 


$39, 762. 83 
78, 236. 75 

106, 598. 88 
37, 347. 98 
41,430. 11 
49, 40S. 94 
48,091.91 
40, 743. 92 


$14, 090. 13 
10,681.11 
11,687. .52 
7.5, 565. 74 
' 88,884.33 
\m, 033. 46 
10,5,611.79 
78, 541. 60 




195:-.53 

1953-54 


$3, .0. 34 
6, 816. 17 


1954-55 

195.5-56 - 


17, 66111 
15, 787. 53 


1956-57 


16.818 03 


1957-58 


21,504.13 


1958-59 (to Dec. 31, 1958) 


10, 488. 66 


Total -- 


972, 660. 15 


1, 110, 732. 93 


441, 621. 32 


493, 095. 68 


597. 601. 03 


92, 112. 97 







COMBINED commissions AND SERVICE FEES TO DEC. 31, 1958 



Policy year ' 


Central 

States 


Michigan 
Conference 


Local 1031 


Total 


1949-50 






$32, 727. 70 
121.072.42 
107,505.56 
116,831.48 
122,711.51 
43. 045. 85 
38, 577. 79 
41, 023. 9S 
46. 668. 43 
18,949.28 


$32, 727. 70 


1950-51 -.- 


$52, 303. 87 
112,238.72 
162, 177 72 
273, 720 81 
21.9, 137. 40 
281, 430. 61 
367, 129. 78 
431,498.60 
193, 746. 48 




173, 976 29 


1951-52 --- 


$53, 852. 96 
88, 917. 86 
118,286.40 
112,913.72 
130, 314. 44 
157, 442. 40 
153, 703. 70 
119.285.52 


273, 597. 24 


1952-53 


367, 927. 06 


19.53-54 


514,727.72 


19.54-.55 


305, 096. 97 


1955-56 


450, 322. 84 


1956-57 --- 


565, .596. 16 


1957-.58 - 


631, 870. 82 


1968-59 (to Dec. 31, 1658) -- 


331, 981. 28 






Total 


2, 083. 393. 08 


934, 717. 00 


689,714.00 


3, 707, 824. 08 







' Policy year on Central States and Michigan Conference runs Apr. 1 to Mar. 31; on Local 1031, May 1 
to Apr. 30. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16005 

Mr. Uhlmann. The total commissioners and service fees paid to 
the Dorf mans from 1949 to a recent rate, total a little over $4 million. 

Mr. Kennedy. AVhat is the recent date? 

Mr. UiiLMANN. The end of December 1958. Of that sum of money, 
$3,700,000 was paid in the form of commissions and service fees in 
relation to three policies alone, and those three policies are the Central 
States and the Michigan conference, and local 1031 concerning which 
I have testiiied as to the award of those particular insurance policies. 

The Chairman. State that figure again, as against the grand total 
of all of them. 

Mr. Uhlmann. The grand total of all was a little over $4 million. 

The Chairman. Can you get it somewhat exact ? 

Mr. Uhlmann. It is $4,041,000. 

The Chairman. All right, and what is the amount from these three 
contracts? 

Mr. Uhlmann. In the aggregate, you mean ? 

The Chairman. Yes. 

Mr. Uhlmann. $3,707,824. 

The Chairman. Plave you calculated the jjcrcentage of the total 
that these three provided ? 

Mr. Uhlmann. In relation to the whole, you mean ? 

The Chairman. Yes. 

Mr. Uhlmann. It is about 92 percent. 

The Chairman. Approximately 92 percent. That is a mathemati- 
cal calculation, but it is approximately 92 percent. Does that repre- 
sent their total business or just business from unions? 

Mr. Uhlmann. This represents only business from group welfare 
insurance of labor unions. 

The Chairman. That is the $4,041,000, that total, that came from 
that source? 

Mr. Uhlmann. Yes, sir. 

The Chairman. And $3,707,824, or approximately 92 percent came 
from the three contracts of the Central States, the Michigan con- 
ference, and local 1031 ? 

Mr. Uhlmann. Yes, sir. 

Mr, Kennedy. Now we will have to break it down for each group ; 
first the Central States. 

]Mr. Uhlmann. As for Central States, which of course is the largest 
by far, the commissions are $972,660. The service fees were $1,110,733. 

Mr. Kennedy. What is the total for that ? 

Mr. Uhlmann. $2,083,393. 

Mr. Kennedy. "WHiat about Michigan conference ? 

Mr. Uhl]nl\nn. Tlie Michigan conference commissions. $441,621. 
The service fees are $493,096. That makes a total of ?;934,717. 

On local 1031, the commissions were $597,601. The service fees 
were $92,113. The total was $689,714. The total in commissions for 
the three groups was $2,011,882. The total service fees were $1,695,- 
942. The total of both, $3,707,824. 

Mr. Kennedy. What are service fees ? 

Mr. Uhlmann. Service fees are paid to an insurance agent or 
broker to cover his costs or designed to cover Ms costs primarily to 
perform two or three functions, and the most important of which, or 
the largest one of which is the processing and payment of claims. 

36751 — 59— pt. 43 5 



16006 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The second represents the mailing and distribution of individual 
policies to members and their dependents, and also booklets, and the 
third is to keep a roster or commonly referred to as the enrollment 

cards of the membership. , j- ^^ r^ ^ ^ 

Mr. Kennedy. So that in commissions, for insurance ot the Central 
States conference, roughly $972,000 in commissions was paid despite 
the assurances to the trustees and to those who made the award that 
no commissions would be paid. 

Mr. UiiLMANN. Yes, sir. . -, , • i 

Mr Kennedy. Mr. Chairman, these are excessively high commis- 
sions. I would like to call now Mr. S. Goodman, of the insurance 
department of the State of New York, and have him sit with Mr. 
Ulilmann and testify on the question of commissions. 
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 
nothing but the truth, so help you God ? 
Mr. Goodman. I do. 

TESTIMONY OF SEYMOUR GOODMAN 

The Chairman. State your name, your place of residence, and your 
business or occupation. i i • xt 

Mr Goodman. Mv name is Seymour Goodman, a broker in JNew 
York, and I am employed by the New York State Insurance Depart- 
ment as a supervising examiner at 123 William Street, m the city of 
New York. „ 

The Chairman. How long have you been so employed i 

Mr. Goodman. Twenty years. , . ^ • a ^:io 

The Chairman. You have had 20 years' experience m this held { 

Mr. Goodman. I have previous technical experience as a general in- 
surance broker and so my insurance experience runs over 30 years. 

The Chairman. Over 30 years? 

Mr. Goodman. That is right. 

The Chairman. Are there any further qualifications ? 

Mr Kennedy. I have here in front of me, Mr. Chairman, a report 
on welfare and pension funds in New York State, submitted to the 
superintendent of insurance ; and another book entitled, ' State of 
New York Insurance Department— Whose Welfare?*' a report on un- 
ion-employer welfare plans in New. York, and it is submitted to 
Bohlinger, the superintendent of insurance, and there is mention of 
the witness in both of the.se books, and I would like to have him 
identify the books if he would. 

The Chairman. I hand you two books, and I ask you to examine 
them and state if you identify them, and if you can, briefly do so 
for tlie record. 

( The documents were handed to the witness. ) 

Mr. Goodman. The first report in the time of publication was 
"Whose Welfare?" published bv the Insurance Department of the 
State of New York. It was published on or about December 1954, 
and it was a report on our fiist formal investiiration of union em- 
ployee welfare plans in New York, and it was made by the deputy 
sm^'^rintendont of insurnnce. Adelbert G. Straub, Jr., to the Honorable 
Alfred J. Bohlinger, superintendent of insurance. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16007 

The Chairman. That book may be made exhibit No. 220 and it 
will be for reference only and not as evidence. 

(The document referred to was marked "Exhibit No. 220" for 
reference, and may be found in the files of the Select Connnittee.) 

Mr. ICennedy. Did you play a major role in the writing of that 
report ? 

Mr. Goodman. Yes. 

Mr. Kennedy. And I believe that in the beginning of the report 
it so states, does it not ? 

Mr. Goodman. In the letter of transmittal by Deputy Superin- 
tendent Straub to Superintendent of Insurance Bohlinger; yes. 

The second report which was published about a little over 2 years 
later on the basis of a continuing and expanded investigation was 
submitted by Martin S. House, who was special counsel to the Hon- 
orable Leffert Holz, superintendent of insurance, and the report 
which is dated February 20, 1956, and published by the insurance 
department, is entitled "Private Employee Benefit Plans, a Public 
Trust, a Report on Welfare and Pension Funds in New York State." 

The Chairman. Thank you, and that book may be made exhibit 
No. 221 for reference. 

(The document referred to was marked "Exhibit No. 221" for 
reference and may be found in the files of the Select Committee. ) 

Mr. Kennedy. Did you also play a major role in the writing of 
this report ? 

Mr. Goodman. Yes, sir. 

Mr. Kennedy. Is that so acknowledged in the book? 

Mr. Goodman. It is, sir. 

Mr. Kennedy. So you had a considerable amount of experience in 
the matter that we are discussing this afternoon? 

Mr. Goodman. I believe so. 

Mr. Ivennedy. Now, Mr. Goodman, have you participated in the 
formation of charts and other documents to show and demonstrate 
how much of a commission brokers should be paid on certain kinds 
of insurance? 

Mr. Goodman. Yes, sir. 

Mr. Kennedy. Now, would you examine these records that are en- 
titled "Computation of Effective Rate of Commission and Average 
of Fii^t Year and Renewal Commission Rate Over 10 Years" ? 

The Chairman. I hand you here a series of documents entitled 
"Computation of Effective Rate of Commission, Average First Year's 
Renewal Commission Rate Over 10 Yeai*s," and ask you to examine 
them and state if you identify the documents, and if you prepared 
them and otlier infonnation that will be helpful to the committee in 
evaluating them. 

Mr. Goodman. I wish to make a correction, sir. I advised mem- 
bers of your staff in the preparation of this, and the calculations were 
prepared under my instructions, how they should be prepared by the 
membere of your staff, and I did check them for accuracy. 

Mr. Kennedy. I am talking first about the charts, the making up of 
the figures that you have to apply. 

Mr. Goodjian. I see. Then perhaps I could explain that I think it 
is important to go back one step. The National Association of Insur- 
ance Commissioner in December of 1957 adopted a code of ethical 
practices with respect to the insurance and benefits of union or union- 



16008 IMPROPER ACTIVITIES IN THE LABOR FIELD 

management welfare and pension funds. I participated in the work 
of drafting this code, which was based upon the recommendation in 
the report entitled "Whose Welfare f This code of ethical practices 
Avas adopted by the Insurance Department of the State of New York 
the same month. 

The code contains a schedule of what are to be considered reasonable 
commissions. 

Mr. Kennedy. Could you talk up a little louder or bring the micro- 
phone closer, because this is extremely important. 

Mr. Goodman. The code sets forth two scales of what are to be con- 
sidered reasonable commissions, and perhaps I should read the para- 
graph which precedes this table. 

The table following illustrates on the basis of the effective rates for the indi- 
cated premium volume a generally accepted range of commission rates, first year 
and renewal average over 10-year commission-paying period, to insurance agents 
and brokers, derived from schedules — 

and I emphasize — 

currently in use on group life and group accident, sickness policies, which are 
considered to be reasonable and not excessive. 

Now, I may interject at this point that these scales were based upon 
quite extensive analysis of studies of commission practices of insurance 
companies writing group insurance and welfare funds as a part of it. 

Mr. Kennedy. And over a period of time ? 

Mr. Goodman. Over a great many years, and that these scales are 
based upon what were considered sound practices in the business for 
many years. Now, we show a range here of two different coimnission 
scales, one which is considered a low one and one which is considered 
somewhat higher, but still considered reasonable. 

Now, these rates of commission shown in the code of ethical prac- 
tices are average rates as indicated over a 10-year period, and for 
use of examiners in the insurance department, we prepared a supple- 
mentary schedule showing the derivation of these commission rates, 
which shows the amount of commissions on both the low and some- 
what higher scale for both first year and renewal. 

It is based upon these commissions, and this worksheet which is 
the basis for the commissions in the code of ethical practices, that 
these calculations were derived. 

The Chairman. That code of ethical practices may be made exhibit 
No. 222 A, and the other document you have there, what is that docu- 
ment ? 

Mr. Goodman. This document is entitled "Code of Ethical Practices 
Witli Eespect to Insuring of Benefits of Union or ITnion-^Mnnajxement 
Welfare and Pension Funds, Illustrative Commission Scales." 

The Chairman. It may be mnde exliibit No. 222B. 

(The documets were marked "Exhibits 222A and 222B" for refer- 
ence and may be found in the files of the select committee) 

Mr. Kennedy. Mr. Uhlman have you applied, the schedule that 
Mr. Goodman talked about to tlie commissions and the sums of money 
that were involved in the awarding of the contract of the Central 
Conference of Teamsters? 

Mr. TThlmann. Yes, sir ; I have. 

Mr. Kennedy. Could you tell us what figures you arrived at? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16009 

Mr. Uhlmann. With respect to Central States, our calculations 
show that from the first policy year, which started March 1, 1950, 
through March 1, 1958, that the commissions that should have been 
paid under this code aggregated $611,200. 

AVith respect to the Michigan conference, which started April 1, 
1951, through March 31, 1958, the commissions there should have 
been $139,400. Local 1031, for which the first policy date was May 
1, 1949, and through April 30, 1958, the aggregate commissions amount 
to $502,600 under the code. 

This makes a total — I am sori-y. The figures I have read there, I 
beg your pardon ; the figures I read to you represent the excess com- 
missions in each case. 

The Chairman. Wait a minute now. Let us start all over again. 
You have us confused. 

Mr. Uhlmann. I am afraid I have. 

The Chairman. Let us start over again and get it correct. "WTiat 
is the $611,000? 

Mr. Uhlmann. The $611,200 represents the excessive commissions 
paid under the Central States policy between March 1, 1950 and 
March 31, 1958. 

The Chair:man. In other words, for 8 years there was an excess 
payment in commissions from the Central States of $611,200? 

Sir. Uhlmann. Yes, sir. 

Tlie Ctt.'.irman. All right. Now we will take the Michigan con- 
ference. Let us get that next. 

Mr. Uhlmann. From April 1, 1951 through March 31, 1958, 
$139,400 was excess. 

The Chairman. That was excess? 

Mr. Uhlmann. Yes ; they are both excess figures. 

The Chairman. Let us get the third one. That would be local 
1031. 

Mr. Uhlmann. Local 1031 of IBEW, Electrical AVorkers, May 1, 
1949 through April 30, 1958, $502,600 is excess. 

And this makes an aggregate excess in commissions for these three 
policies of $1,253,200 for the period of time stated. 

The Chairman. That is just commissions ? 

Mr. Uhlmann. That is just commissions. 

The Chairman. That has nothing to do with service charges ? 

]\Ir. Uhlmann. No, sir. 

The Chairman. Do you have something with respect to service 
charges ? 

]Mr. Kennedy. I do not think he has finished with commissions. 

I would like to ask Mr. Goodman if he has any comment on those 
figures. 

Mr. Goodman. Yes, I think that the method of computation which 
led to these excess figures was done on an extremely conservative basis, 
giving the benefit of the doubt and possibly having the commission 
slightly higher according to the code of ethical practices scale than 
they might bs. The reason for that is that we had no basis of deter- 
mining what were to be considered first-year premiiuns upon which 
they might be entitled to a first-year commission during renewal 
years. 



16010 IMPROPER ACTIVITIES IN THE LABOR FIELD 

As a result, we considered all increases in premium from year to 
year as first-year premiums for first-year commission purposes. Be- 
cause a commission in the first year is considerably higher than in 
renewal years, there is a possibility that these figures may overstate 
the amount of what would have been the reasonable amount of com- 
mission. So possibly if it were possible to go back in complete detail, 
the excess might possibly be greater. 

Mr. Kennedy. This is a conservative figure ? 

Mr. GrOODMAN. Right. 

Mr. Kennedy. On these three policies, at least $1,250,000 in excessive 
commissions were paid? 

INIr. Goodman. Based upon the benchmark of the code of ethical 
practices. 

The Chairman. Do you think there is any doubt but what a repu- 
table insurance company would have been glad to handle it for the 
amount of commission you indicate would be reasonable ? 

Mr. Goodman. Yes, sir. We have characterized in at least one or 
two or three of these cases, and the two reports I referred to, that the 
commissions on these cases were excessive. 

Mr. Kennedy. You have already taken note of that officially ? 

INIr. Goodman. Yes. They have been characterized in the report. 
They are only identified by code, though, and not by name. 

The Chairman. In other words, these were taken into account in 
the report that you made ? 

Mr. Goodman. Yes, sir. 

The Chairman. Although they are not identified except by code. 
You know which ones they are, do you ? 

Mr. Goodman. I do, sir. 

Senator Ervtn. Did I understand that in making this computation, 
reaching this conclusion, in order to be perfectly fair you gave the 
benefit of all doubt to those receiving the commissions ? 

Mr. Goodman. Yes, sir. 

Mr. Kennedy. That would be over $750,000 of that which was from 
the Central Conference of Teamsters and from the Michigan Welfare 
Fund ; is that right, Mr. Ulilmann ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. And those were insurance policies that were awarded 
directly by Mr. Ho if a ? 

Mr. tjHLMANN. I would say that, yes, or through his influence. 

Mr. Kennedy. Do you have some other figures that you want to add 
to that on the commissions as far as Dr. Perlman is concerned ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. We have another figure to add to this. There were 
otlior commissions that were paid on the same insurance. 

Go ahead. 

Mr. Uhlmann. Over and above the commissions paid to the Dorf- 
man agencies for the insurance just described, there were some 
$600,000-odd paid to the United Public Service Corp., which was an 
entity that was established largely by Dr. Perlman, who was referred 
to earlier in this testimony, and by virtue of the dual capacities that 
he occupied in each of these companies, he was able to funnel rather 
extensive sums of money by way of commissions and alleged service 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16011 

fees through the United Public Service Corp, primarily for his own 
financial enrichment. 

With respect to the three policies alone that we have been talking 
about here today, we calculate that a little over $600,000 by way oi 
commissions, commissions alone, were paid to the United Public 
Service, all of which we regard as excessive on the ground that there 
seems to have been no basis whatsoever for this company to play any 
part in this insurance, that is, in the acquisition of this insurance or 
in servicing the contract. 

(At this point Senator Church entered the hearing room.) 

Mr, Kennedy. Do you agree with that, Mr. Goodman ? 

Mr. (toodman. My recollection on some of that is quite hazy, as I 
only participated on sort of a fringe basis with respect to some of 
these transactions, although I would say that Dr, Perlman was wear- 
ing two hats at the same time and there might be a question as to the 
payment of commissions. 

]\Ir. Kennedy. But the part that is slightly more questionable is an 
additional $600,000; is that right? 

Mr. UiiLMANN. Yes. 

Mr, Kennedy. That would bring the total up to approximately 
$1,850,000? 

Mr. Uhlmann. Yes. 

Mr. Ivennedy. $1,250,000 definitely is established, and the $600,000 
is where there is a question ; is that right ? 

Mr. Uhlmann. Yes. 

(At this point the chairman left the hearing room.) 

Mr. Ivennedy, Is there anything you wish to add ? 

Mr. Goodman, I have nothing further. 

Mr, Ivennedy. This report and the investigation was done on the 
Dorfman and Perlman operation was done in what year ? 

Mr. Goodman. May I have both volumes ? 

Mr. Kennedy. That was done by the commission in New York ? 

Mr. Goodman. By the insurance department in New York. I might 
say this: That you must bear in mind that we were not considering 
Dorfman or Union Casualty as individual operations. We were in- 
vestigating all welfare fund activities in the State of New York as 
handled by insurance companies licensed to do business in the State of 
New York. 

At the same time, we were developing other information as part of 
our regular examination w^ork of the Union Casualty. What is con- 
tained in this report is based primarily upon the special investigation 
of welfare funds generally. 

At certain parts of the report reference is made to Central States, 
Michigan conference, and local 1031, and they indicate and character- 
ize that the commissions and fees paid in those instances were 
excessive. 

If you wish to, I can identify the places in the report. 

Mr, Ivennedy, Wliat year was this ? 

Mr, Goodman, This first report, "Wliose Welfare?" was printed on 
December 6, 1954, 

Mr, Ivennedy, And this situation that you went into in 1954 has 
been going on ever since, evidently, from the figures that have been 
revealed here ? 



16012 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Goodman. I have reason to believe so. 

Mr. Kennedy. Are the Dorfmans licensed to practice insurance in 
the State of New York? 

Mr. Goodman. No, sir. 

Mr. Kennedy. Why is that? Has their license been lifted by the 
Stateof New York? 

Mr. Goodman. Their license was revoked by the State of New York. 

Mr. Kennedy. For what reason ? 

Mr. Goodman. For refusal to permit our examiners to look into the 
records of Allen Dorf man or the Union Insurance Agency of Illinois, 
a licensee of the New York Insurance Department. 

Mr. Kennedy. Mr. Uhlmann, are there some figures on the service 
fees that you would like to place into the record ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. That is, the excessive payments on service fees to 
the Dorfmans? 

Mr. Uhlmann. The only cost information that we were able to 
develop with respect to servicing of contracts which are handled by 
the Dorfman agencies cover a period of some 18 to 20 months. In 
this period of time, we have found that, for about 6 or 7 months, 
the difference between the amount received from the insurance com- 
pany as service fees and the amount charged as expenses in servicing 
these contracts, represented a difference of 53 percent, which is a 
different way of saying, another way of saying, that there was roughly 
a 53 percent profit made on this servicing. 

I believe that insurance experts will vouch for the fact that in the 
main, servicing is a function performed by an agent concerning which 
little or no profit is expected to be made. 

Mr. Kennedy. Is that correct, Mr. Goodman ? 

Mr. Goodman. Yes, sir. 

Mr. Kennedy. Based on our calculations, it would appear, at least, 
that they made profits amounting to approximately 53 percent? 

Mr. Uhlmann. For the period of time I just referred to. For a 
fuller period, and this is the only period on which the records were 
available to us, we have found that the profit was some 27 percent. 

So in, shall we say, averaging it out or leveling it off, we come up 
with an extraordinarily conservative estimate as to what might be ex- 
cess, and we fixed it at 25 percent. We don't feel anyone can quarrel 
with that as constituting excess. 

On that basis alone, measured against the total service fees received 
over a period of time on these three policies alone, there is a minimum 
of $400,000-odd that could readily be declared as being excessive. 

(At this point the chairman entered the hearing room.) 

(At this point Senator Ervin left the hearing room.) 

Mr. Goodman. May I make a correction ? As far as the service fees 
are concerned, it has been a long established policy of the Insurance 
Department of the State of New York and it is now represented in 
the code of ethical practices, that there should be no profit factor in 
service fees. 

Mr. Kennedy. None at all? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16013 

Mr. Goodman. None at all. May I read from the code of ethical 
practices with respect to that ? 

An insurer should not make any payment of fees or allowances of whatever na- 
ture and by whatever name to any person, firm, or corporation, in connection with 
the sale, service, or administration of a group policy issued to a welfare or pension 
fund other tluin commissions to an insurance agent or broker as heretofore 
described, except in reimbursement for the reasonable value of one or more 
of the following services performed on behalf of the insurer. 

They must be services performed on behalf of the insurer. The 
only four services that we recognize are : 

(1) Issuing certificates. 

(2) Maintaining employee records. 

(3) Billing premiums. 

(4) Processing claims. 

Senator Church. Is that code of ethics officially promulgated by 
the State of New York ? 

Mr. Goodman. It was adopted first by the National Association of 
Insurance Connnissioners in December of 1957, and in the same month 
adopted by the Insurance Department of the State of New York. 

Senator Church. So it has the adherence and approbation of the 
insurance companies themselves ? 

Mr. Goodman. Yes. We worked in the drafting of this with many 
representatives of some of the outstanding insurance companies in 
the country. 

Mr. Kennedy. So it would appear, would it not, that the excess 
payments to the Dorfmans and Dr. Perlman in this matter amounted 
conservatively to $1,650,000, and possibly up to well over $2,250,000 ; 
is that correct ? 

Mr. Ulhmann. I would say that; yes, sir. 

Mr. Kennedy. But the conservative figure is $1,650,000 that was 
paid in excess to Allen Dorfman, period, and with the possibility of 
another $600,000 in excess to Dr. Perlman ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. But Allen Dorfman and his mother received this 
$1,650,000 excess payments. 

Mr. Chairman, we are going into other matters in connection with 
this, but I think we might want to call Mr. Allen Dorfman back for 
a moment first. 

Thank you, Mr. Goodman. 

The Chairman. Thank you, gentlemen. 

Mr. Dorfman, you may take the stand if you wish. 

TESTIMONY OF ALLEIT DORFMAN— Eesumed 

The Chairman. Let the record show that Mr. Dorfman is recalled. 

All right, Mr. Kennedy ; proceed. 

Mr. Kennedy. Mr. Dorfman, could you tell us what arrangements, 
what conversations you had regarding the granting of the commis- 
sions in connection with the Central Conference of Teamsters? 

Mr. Dorfman. I claim my privilege under the fifth amendment to 
the Constitution. 

Mr. Kennedy. Can you tell us anything about the Michigan Con- 
ference of Teamsters ? 



16014 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr, DoRFMAN. I claim my privilege under the fifth amendment to 
the Constitution. 

Mr. Kennedy. Can you tell us whether it is a fact that you have 
received excess payments of $1,650,000 ? 

Mr. DoRFMAN. I claim my privilege under the fifth amendment 
to the Constitution. 

Mr. Kennedy. Mr. Dorf man 

Mr. Clinton. Mr. Chairman, I do not know how good my mathe- 
matics are, but if that computation of $1,600,000 is correct, Dorfman 
would have been in the hole around $400,000 or $500,000 during the 
time he was in business. I would suggest that maybe some recompu- 
tation might be in order. 

The Chairman. We are perfectly willing to have it. We will ask 
your client to help us do it. 

Would you help us? Would you be glad to help us? Mr. Dorf- 
man? 

(The witness conferred with his counsel.) 

Mr. Clinton. Unfortunately, Mr. Chairman, Mr. Dorfman is in a 
position that if he starts to discuss finances, he would have waived 
his privilege. But these are simple matters of statistics of income 
and disbui-sements of this agency, to which the investigators of the 
committee have had access. 

As I understand it, Dorfman would have lost $400,000 by being in 
business for over 9 years, if Mr. Kennedy's mathematics are correct. 
I think it might bear checking. 

The Chairman. Mr. Counsel, you are here to represent your client 
and that is true. But I don't believe it would be well for you to testi- 
fy for him. I think it would be well and we would be glad to re- 
ceive his testimony if he wants to testify that he lost it or would 
have lost $400,000 on the basis of this calculation. AVe will be glad 
to hear his testimony, and then take other testimony and go right 
into the merits of it and ascertain what the facts are. 

All I know is what these witnesses who are in a position to know, 
who have checked the records, testify to. Here is a man who is pre- 
sumably an expert in this field who has been a witness. I have no 
reason to question his qualifications as such. Apparently that has 
been pretty well established. 

Sometimes there can be expense that we do not know about, but 
these experts ought to know generally what is right and what is a fair 
fee, and a commission. They have testified. I would be very happy 
if Mr. Dorfman could testify and throw some light on this whole 
transaction. If there is nothing wrong with it, it should be cleared 
up, because there are working people who have something at stake 
here. 

In fact, the whole labor movement has something at stake. I think 
business has something at stake, too. We have here, again, as I 
pointed out earlier, a spectacle of a businessman handling large trans- 
actions like this who comes in here and states under oath that he 
honestly cannot talk about it or he cannot answer questions about it and 
tell the truth about it without the risk of self-incrimination. 

So under those circumstances, we liave to resort to testimony from 
others who have had experience, and make comparisons with what 
the record shows here and what, from their experience, would be a 



lAtPROPER ACTIVITIES IN THE LABOR FIELD 16015 

proper or fair charge, a reasonable profit or commission, for such 
services. 

All right, Mr. Counsel, have you anything further ? 

Mr. Kennedy. Just if Mr. Dorfman would give us any explanation 
as to how he was able to make over $1,650,000 in excess profits in 
connection with the Central Conference of Teamsters and the Michi- 
gan conference. I would like to hear it. 

Could you give us an explanation, Mr. Dorfman ? 

Mr. Dorfman. I claim my privilege under the fifth amendment 
of the Constitution. 

Mr. Kennedy. Do you feel that a truthful answer might tend to 
incriminate you, if you gave us a truthful answer ? 

Mr. Dorfman. Yes, sir. 

The Chairman. Is there anything further? 

Mr. Kennedy. That is all for now. 

The Chairman. Mr. Dorfman, you will return tomorrow. 

The committee will stand in recess until 11 o'clock tomorrow. 

(Members of the select committee present at time of recess: The 
Chairman and Senator Church.) 

(Whereupon, at 4:12 o'clock p.m. the select committee recessed, to 
reconvene at 11 o'clock a.m., Wednesday, January 28, 1959.) 



INVESTIGATION OF IMPROPER ACTIVITIES IN THE 
LABOR OR 3IANAGEMENT FIELD 



WEDNESDAY, JANUARY 28, 1959 

U.S. Senate, 
Select Committee on Improper Activities 

IN THE Labor or Management Field, 

Washington, D.C 

The select committee met at 11 a.m., pursuant to recess, in the 
caucus room, Senate Office Building, Senator John L. McClellan 
(chairman of the select committee) presiding. 

Present : Senator John L. McClellan, Democrat, Arkansas; Senator 
Sam J. Ervin, Jr., Democrat, North Carolina ; Senator Frank Church, 
Democrat, Idaho; Senator Karl E. Mundt, Republican, South Dakota. 

Also present : Robert F. Kennedy, chief counsel ; Pierre E. Salinger, 
investigator: Joseph F. Mahei', investigator; ]\Iai*tin S. Uhlmann, in- 
vestigator; John P. Findlay, 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: Senators McClellan and Curtis.) 

The Chairman. Mr. Kennedy, call your next Avitness. 

Mr. Kennedy. Mr. Chairman, we have a number of different facets 
of the insurance that we are going to go into today. I would like to 
start out by calling a member of the staff, Mr. John Findlay, in con- 
nection with the embezzlement of some of the layoff premiums. 

The Chairman. Be sworn, please. 

You do solemnly swear the evidence you shall give before this Senate" 
select commitfee shall be the truth, the whole truth and nothing but 
the truth, so help you God ? 

Mr. Findlay. 1 do. 

TESTIMONY OF JOHN P. FINDLAY 

The Ch mrman. State your name, your place of residence, and your 
present employment, 

IMr. Findlay. John P. Findlay. I reside at 315 Maryland Avenue, 
Freeport, N.Y. I am a CPA and I am employed by the United States 
Army Audit Agency. I am on loan to your committee. 

The Chairman. How long have you been a CPA ? 

Mr. Findlay. I was given my certificate in XeAv York in 1937. 

The Chairinian. 1937 ? 

Mr. Findl.\y. 1937. 

The Chairman. More than 20 years ? 

16017 



16018 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. FiNDLAT, That is right. 

The Chairman. Proceed, Mr. Kennedy. 

Mr. Kennedy. How long have you been with this committee ? 

Mr. FiNDLAY. For about 1 year. 

Mr. Kennedy. Have you been working during that period of time 
on the investigation of Allen and Paul Dorfman ? 

Mr. FiNDLAY, That is right. 

Mr. Kennedy. And the insurance that was granted by the Central 
Conference of Teamsters; is that right? 

Mr. FiNDLAY. That is so. 

Mr. Kennedy. Mr. Findlay, is one of the matters that you have 
spent some time on the so-called layoff premiums that have gone 
through the office of Mr. Allen Dorfman ? 

Mr. FiNDLAY. Yes. 

Mr. Kennedy. Would you explain to the committee what a layoff 
premium is ? 

Mr. FiNDLAY. The insurance certificate issued by the Mount Vernon 
Life Insurance Co. under the group policy provides, with respect to 
each member of local 1031 — this is the Electrical Workers — that in 
the case of a temporary layoff or a leave of absence, or a work stoppage, 
the individual policyholder may continue the insurance by making the 
premium payments direct during the period of layoff. 

In this case, the provision applied for a period of about 6 months. 
In other words, he could carry his insurance for 6 months after the 
time he was laid off. 

Senator Church. Without paying the premium during that period ? 

Mr. FiNDLAY. No. Instead of the employer making the premium 
under the group insurance plan, the individual has the right to con- 
tinue the insurance on his own by making the payment direct. 

Senator Church. I see. 

Mr. FiNDLAY. Now, in the case of local 1031, they issue a booklet to 
each of their members, in which they tell them of this arrangement, 
and provide that they will instruct them how the premium is to be 
paid. 

Local 1031 being in Chicago, the premiums are paid directly to Allen 
Dorfman's insurance company. That is the Union Insurance Agency 
of Illinois, or, in some cases, to the Aldor Insurance Agency. 

Mr. Kennedy. Aldor, A-1-d-o-r ? 

Mr. FiNDLAY. A-1-d-o-r. 

Mr. Kennedy. And that is Mr. Allen Dorfman's insurance agency ? 

Mr. FiNDLAY. That is also one of Mr. Allen Dorfman's insurance 
companies. 

Mr. Kennedy. What is he supposed to do with the premiums after 
he receives them ? 

Mr. FiNDLAY. Mr. Dorfman is supposed to remit them in accordance 
with the laws of the State of Illinois. These being fiduciaiy funds, 
they are to be remitted within 90 days after he receives them. He was 
supposed to remit them to the Mount Vernon Life Insurance Co. in 
the latter period. 

It was formerly known as the Union Casualty and Life Insur- 
ance Co. 

Mr. Kennedy. Did we find on our investigation that instead of re- 
mitting or forwarding these premiums on to the insurance company 






IMPROPER ACTIVITIES IN THE LABOR FIELD 16019 

itself in New York, he deposited the premiums in his own bank 
account ^ 

Mr. FiNDLAY. He first deposited the premiums in a bank account 
of the Union Insurance Agency of Illinois, which is his company in 
partnership with his mother, Rose. These moneys were put in a fund, 
a bank account, in the Exchange National Bank, marked "Special 
Account." During the period that we conducted the examination, 
there was some $51,461.66 collected with respect to these premiums 
from the individuals. 

]\[r. Kennedy. How much was that again? 

Mr. P^iNDLAY. $51,461.66. 

Mr. Kennedy. These were premiums that were collected and not 
forwarded to the insurance company, but were deposited in a special 
account, which belonged to Allen Dorfman and his mother, Rose Dorf- 
man ; is that correct ? 

Mr. FiNDLAY. That is right, to his Union Insurance Agency of Illi- 
nois company, owned by Allen and his mother. Rose. 

Mr. Kennedy. Over what period of time was he depositing these 
premiums in his own bank account? 

Mr. FiNDLAY. From April 1954 to February 1957 was the date that 
the $51,000 we are speaking of was accumulated. 

Mr. Kennedy. And this ceased shortly after our investigation be- 
gan ; is that correct? 

Mr. FiNDLAY. That is right. 

Mr. Kennedy. What steps then did Mr. Allen Dorfman take? 

Mr. FiNDLAY. Well, before I tell you what happened to the $51,000 
that was remitted eventually to the Mount Vernon Life Insurance 
Co., I would like to mention that there were 21 items draw^n on this 
Union Insurance Agency fiduciary account totaling $47,544.63, com- 
prising payments to Allen Dorfman's entities, Aldor Insurance 
Agencv ; Dover Insurance Agency ; Union Insurance Agency of Illi- 
nois ; Windsor Investment Co. ; Northwestern Oil Co. ; David Prob- 
stein, general agent; Allen Dorfman, general agent; the Michigan 
Conference of Teamsters Welfare Fund; and to Allen Dorfman 
personally. 

Mr. Kennedy. So he deposited the money in the bank account 
and then, over this period of time, he spent the money? 

Mr. FiNDLAY. Yes. He financed the operations of other com- 
panies, including some of the expenses of the Union Insurance Agency 
of Illinois, and, of course, several of these checks were drawn to Allen 
Dorfman himself. Allen signed all of the checks coming out of this 
fiduciary account. 

Mr. Kennedy. Were there any other funds placed in the account? 

Mr. FiNDLAY. Well, of course, there were some other funds. Oc- 
casionally there would be a deposit from the policyholder and the 
policyholder would go back to work so they made the refund in small 
amounts to the individuals. These would be the monthly premiums 
for which they had paid, and subsequently the company taking them 
on their payroll would indicate that they were covered. So the em- 
ployee would occasionally get some minor checks back. 

On February 19 and 20, apparently the decision was made to make — 
this is 1957 — a decison was made to repay these funds to the Mount 
Vernon Life Insurance Co., so it was necessary for Allen to draw 



16020 IMPROPER ACTIVITIES IN THE LABOR FIELD 

the money that had been advanced to the othei- entities from these 
companies to reimburse the account, because actually the account 
sometimes had less than $1,000 in it, although the average was some 
$17,000 collected for the 3-year period. 

The Chairman. Are you speaking of this $51,000 account now ? 

Mr. FiNDLAY. Yes, the $51,000 account. 

The Chairman. At times it had less than $1,000 in it ? 

Mr. FiNDLAY. Had less than $1,000 in it ; yes. 

The Chairman. That was before the reimbursement was made ? 

Mr. FiNDLAY. Before the reimbursement. 

Now, Mr. Kennedy, your point with regard to the payment of the 
$51,000 to the Mount Vernon Life Insurance Co. 

Senator Church. Before we get to that, this reimbursement, when 
was it made with respect to the time that our committee investigations 
of this matter commenced ? 

Ml". FiNDLAY. Well, all the money was refunded on the dates that 
I have mentioned, February 19 and 20. 

Senator Church. February 19 and 20? 

Mr. FiNDLAY. Of 1957. 

Senator Church. When did the committee investigation of this 
matter start ? 

Mr. Kennedy. Well, we began our investigation of tlie Teamsters 
and of this whole arrangement back in January of 1957, and we had 
witnesses in starting with the Senate Subcommittee on Investigations 
around January 11, 1957. Then the select committee was set up on 
February 1, 1957. So it was at least a month that the individuals 
w^ere well aware of the fact that we were investigating this whole 
subject matter. 

Mr. FiNDLAY. Two checks w^ere drawn to the Mount Vernon Life 
Insurance Co. by the ITnion Insurance Agency of Illinois for the lay- 
off premiums withheld for the period April 1954 to February 1957. 

One of the checks was dated March 11, 1957. The payee was the 
Mount Vernon Life Insurance Co., and the amount was $39,155.35. 
This check was received in Mount Vernon, N.Y., and deposited in the 
Mount Vernon Life Insurance Co.'s account. 

With respect to the difference of $12,306.31, a second check was 
drawn on June 21, 1957, and the payee in this case was the same, the 
Mount Vernon Life. However, tliat check ne'\'er reached the Mount 
Vernon Life Insurance Co. until December of 1957. 

Mr. Kennedy. What happened to that money? That was how 
much ? 

Mr. FiNDLAY. $12,306.31. 

Mr. Kennedy. Did you trace that check for us? 

Mr. FiNDL.\Y. Allen Dorfman took the chex:'k which was drawn in 
his own office in Chicago. It was payable to the Mount Vernon Life 
Insurance Co. He had a rubber stam]^ endorsement placed on the 
check, Mount Vernon Life Insurance Co. 

He then signed it personally and endoi'sed it pereonally, and de- 
posited it in his personal bank account in the Exchange National 
Bank of Chicago. 

Mr. Kennedy. In fact, he made the check out to the Mount Vernon 
Insurance Co., and then with a rubber stamp he endoi-sod it on the 
back, "The Mount Vernon Life Insurance Co."; is that right? 

Mr. FiNDLAY. That is ri<rht. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16021 

Mr. Kekxedy. Then he endorsed it himself and deposited the check 
in his own bank account? 

Mr. FiNDLAY. Yes. 

Mr. Kennedy. So it would appear, if you just made an examination 
of the records, that he had in fact turned over this $12,000 to the 
insurance company ? 

Mr. FiNDL.\Y. Yes. 

Mr. Kennedy. When in fact, he had forged the signature on the 
back with a rubber stamp and deposited it in his own bank account? 

Mr. Findlay. That is right. 

Mr. Kennedy. Would you tell the committee how we came to leam 
that? 

Mr. Findlay. Well, of course, seeing the two checks drawn, we 
tried to trace them to the books of the Mount Vernon Life Insurance 
Co., and spent considerable time at Mount Vernon with no result. 

We subsequently subpenaed the accounts of this premium insur- 
ance account, and we found that tlie $12,306.31 which had been trans- 
ferred to Allen's account in June, he had arranged with the Exchange 
National Bank to notify Mount Vernon Life Insurance Co. that 
the deposit was in error, and that it was being credited to their ac- 
count in the Exchange National Bank of Chicago. That was on 
December 9, 1957. 

The information was furnished to the bank by IMike Breen, the 
comptroller for Allen Dorfman's insurance entity. The bank acted 
on his instructions without making any check of the deposit slip, 
which clearly showed the amount of $12,306.31 was intended to be 
deposited to Allen Dorfman's account in June. 

We visited the bank and obtained an affidavit from them stating 
that the transaction had been handled in accordance with the instruc- 
tions from Dorfman's office, and that the previous advices stating 
that the deposit had been credited to the wrong account was in error. 

Mr. Kennedy. Do you have that affidavit? 

Mr. Findlay. Yes, we do. 

Mr. Kennedy. What happened was that Dorfman, after we began 
to make an investigation of this, had the bank executive write out 
a statement to the insurance company that this check had been de- 
posited in error in Allen Dorfman's account; is that right? 

Mr. Findlay. Yes. 

Mr. Kennedy. Then upon our investigation and examination of 
the check, we found that it could not have been in error, and they 
then furnished us an affidavit from the bank executive saying tliat 
the check had been deposited in Allen Dorfman's account on the in- 
structions of Allen Dorfman's office ? 

Mr. Findlay. That is right. 

Mr. Kennedy. Could we have the affidavit ? 

The Chmrman. Do you have the checks that you referred to there? 

Mr. Findlay. I do. 

Tlie CiTAiR^rAN. Do you have photostatic copies of them ? 

Mr. Findlay. I do. 

The Chairman. The check for $39,155.35, I believe that is tlie 
amount of it — is that correct ? 

Mr. Findlay. Yes. I will have it in a second. 

36751 — 59— pt. 43 ^6 



16022 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. I am trying to identify it to make it an exhibit. 

Mr. FiNDLAY. The $39,155.35— 

The Chairman. That check, a photostatic copy of it, may be made 
exhibit No. 223, and the check in the amount of $12,306,31 that you 
have referred to may be made exhibit No. 223-A. 

(The checks referred to were marked "Exhibits Nos. 223 and 223-A" 
for reference and will be found in the appendix on pp. 16180-16181.) 

The Chairman. Since they relate to the same account, we will make 
them similar exhibit numbers. 

The letter of December 9, 1957, from Morry Rapaport, of the Ex- 
change National Bank of Chicago, to Mr. William Smith, secretary- 
treasurer, Mount Vernon Life Insurance Co., will be made exhibit 
223-B. 

(Document referred to was marked "Exhibit 223-B" for reference 
and will be found in the appendix on p. 16182.) 

The Chairman. The other document, of the Exchange National 
Bank of Chicago, showing credit to the account, may be made exhibit 
223-C. 

(Document referred to was marked "Exhibit 223-C" for reference 
and will be found in the appendix on p. 16183.) 

The Chairman. We have an affidavit from Morry Rapaport, dated 
the 28th day of February 1958. 

Mr. Kennedy. The point is, Mr. Chairman, that this letter, which 
is exhibit 223, was sent to the insurance company, and the impression 
that you would arrive at upon reading this letter is that by a mistake 
made by the bank, this check was deposited in the account of Allen 
Dorfman rather than sent on through the insurance company. 

Upon our investigation and examination of the check, we found that 
to be impossible. 

So then we went back to the bank and asked them for an explana- 
tion of this letter, which was wholly misleading. The check shows 
clearly that Allen Dorfman intended to deposit the check in his own 
bank, account. 

The Chairman. The letter which I have referred to, which was 
made one of the exhibits numbered 223, 223-B, reads: 

Due to an error, we have deposited check No. 1502 for $12,306.31, made out to 
the Mount Vernon Life Insurance Co., dnted .lune 21, 19.")7. to the Allen M. 
Dorfman account instead of to the Mount Vernon Life Insurance Co. We have 
this day rectified this error and regret having caused you any inconvenience. 

The affidavit, dated the 28th of February 1958, states that on De- 
cember 9, 1957, he received a telephone call from one Mike Breen. 

* * ♦ wlio is connected with a number of Allen Dorfman enterprises and is well 
known to this affiant ; that said Mike Breen informed this affiant that a certain 
check numbered in02 in the amount of $12,300.31 had been deposited to the ac- 
count of Allen Dorfman on June 21. 19.57, when it should have been deposited 
to the account of Mount Vernon Life Insurance Co., and requested this affiant 
to rectify the matter and notify Mount Vernon Life Insurance C'O. accord- 
ingly ; that as requested this affiant, without visual inspection of check No. 1502 
of Union Insurance Agency of Illinois, fiduciary premium account, and the de- 
posit ticket covering the deposit of such check caused the account of Allen Dorf- 
man to be debited with the sum of $12,306.31 and the account of the Mount Vernon 
Life Insurance Co. of New York to be credited with a like sum. 

That is signed "Morry Rapaport," and dated as indicated by the 
Chair. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16023 

The affidavit may be printed in full in the record at this point. 
(The affidavit follows:) 

Affidavit 
State of Illinois, 
€ounty of Cook, ss: 

Morry Rapaitort, being first duly sworn on oath, deposes and says: 

That he is assistant vice president of the Exchange National Bank of Chicago; 

That on December 9, 1957, he received a telephone call from one Mike Breen, who 
is connected with a number of Allen Dorfman enterprises and is well known to 
this affiant; 

That said Mike Breen informed this affiant that a certain check numbered 1502 
in the amount of $12,306.31 had been deposited to the account of Allen Dorfman 
on June 21, 19r>7, when it should have been deposited to the account of Mount 
Vernon Life Insurance Co., and requested this affiant to rectify the matter and 
notify Mount Vernon Life Insurance Co. accordingly ; 

That, as requested, this affiant without visual inspection of check No. 1502 of 
Union Insurance Agency of Illinois, fiduciary premium account, and the deposit 
ticket covering the deposit of such check caused the account of Allen Dorfman 
to be debited with the sum of .$12,300.31 and the account of Mount Vernon Life 
Insurance Co. of New York to be credited with a like sum. 

Further affiant saith not. 

(Signed) Morrt Rapapokt. 

Subscribed and sworn to before me this 28th day of February 1958. 
[seal] (Signed) Aluert Laxgelutig, 

Notary Puhlic. 

Mr. Kennedy, The check, as you will see, is made out to the Mount 
Vernon Life Insurance Co. of New York, Mr. Chairman. 

The Chairman. AVe are speaking now about the check for $12,306.31. 
It w^as made to the Mount Vernon Life Insurance Co. On the back it 
is stamped Mount Vernon Life Insurance Co. and then signed Allen 
M. Dorfman. The check was deposited in Dorfman's personal account. 
Is that correct, counsel ? 

Mr. FiNDLAY. That is correct. 

The Chairman. That check was deposited in Dorfman's personal 
account and did not go into the Mount Vernon Life Insurance Co. 
account at all ? 

Mr. FiNDLAY. That is correct. 

The Chairman. In other words, although the records of this $51,461 
account showed that a check had been issued on it for $12,306.31 to 
Mount Vernon, that check, the proceeds of it, went back into Dorf- 
man's personal account? 

Mr. FiNDi^Y. That is right. 

The Chairman. So until further investigation was made and this 
was discovered, the Mount Vernon Life Insurance Co. did not receive 
that money ? 

Mr. FiNDLAY. They didn't know about it. They didn't receive it. 

The Chairman. They didn't even know about it 'i 

Mr. FiNDi^A.Y. No. 

The Chairman. Did they know about it before the letter of 
December 7, 1957? 

Mr. FiNDLAY. No, they did not. 

The Chairman. That was the first information. In other words, 
this thing has gone on since June 1957, until December, when the 
investigators found this situation. It w\as then that the bank wrote 
the letter, apprising the INIount Vernon Life Insurance Co. of the fact 
that an error had been made and this had been deposited to Mr. 
Dorfman's account? 



16024 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. FiNDLAY. That is correct. 

The Chairman. Is that the correct situation ? 

Mr. FiNDLAY. Yes. 

Tlie Chairman. In other words, this money had been misappro- 
priated from the Union Life Insurance Co. and placed in Dorfman's 
personal account? 

Mr. FiNDLAY. Yes. 

The Chairman. That was a misappropriation of it. 

Mr. FiNDLAY. A misappropriation of transmission of these funds, 
as required by the Illinois Insurance Code. The fimds should be 
transmitted within 90 days after the receipt thereof. 

The Chairman. Well, the misappropriation — the other records, the 
records of the $51,000 account would show on the basis of this check 
that the money went to Union Life Insurance Co. ; that it had been 
reported and had been paid. 

Mr. FiNDLAY. That is right. 

The Chairman. That is what the $51,000 account would show. 

Mr. FiNDLAY. Yes. 

The Chairman. But in pursuing the check and trying to find when 
those proceeds reached the Mount Vernon Life Insurance Co., you 
found tliat they had not reached there at all ; that instead, they had 
gone into Dorfman's personal account. 

Mr. FiNDLAY. Yes, sir. 

The Chairman. And that vras by veasf^n of the wf v he mdors'^d the 
check, by stamping Mount Vernon Life Insurance Co. on it and then 
placing his own name under that endorsement and having the check 
deposited to his credit, to his personal credit. 

^fr. FiNDLAY That is exactly right. 

The Chairman. Wlien you discover that, the bank writes this letter ; 
is that correct? 

Mr. FiNDLAY. Yes. 

The Chairihan. Then it gives the affidavit to which we referred, in 
which it says that Mr. Mike Breen had instructed, in a telephone 
call 

* * * that he received a telephone call from one Mike Breen, connected with 
a number of Allen Dorfman's enterprises and well known to this affiant * * *, 

It was from him that thev found out that this monev had been 
misappropriated or diverted into a personal account instead of going 
into the Mount Vernon Life Insurance account where it belonged? 

Mr. FiNDLAY. Yes. I would like to make this clear, though : The 
account that Allen Dorfman used to make the transfer to, that was 
the Exchange National Bank account of the Mount Vernon Life 
Insurance Co. in Chicago. Tlie Allen Dorfman Agency was not au- 
thorized to make any deposits to that account and never has done so. 
Furthermore, that account is not used for premium collections, which 
this represents. That information came from the Mount Vernon Life 
Insurance Co. 

The Chairman. In other words, this is further out of order or out 
of line with regular procedure, because the money did not belong in 
tliat account in the first place ? 

Mr. FiNDLAY. Exactly. 

The Chairman. It should have gone to anotlier account. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16025 

Mr. FiNDLAT. It should have gone directly to the Mount Vernon 
Life Insurance Co. offices in Mount Vernon, N.Y. 

The CiiAiBMAJsr. That is where all other premiums had gone? 

]\Ir. FiNDLAT. That is so. 

The Chairman. You spoke of tlie withholding. This account of 
$51,461.66, I believe, was established in April 1954? 

Mr. FixDLAY. 1954, and ran through February of 1957, although the 
two checks were drawn in March and June. 

The Chairman. I understand. But at the time the account was 
opened, it was not opened for the amount of $51,000. 

Mr. FiNDLAY. No. It was increased by the receipt of the individual 
premium payments by the laid-off employees, averaging about $17,000 
a year. 

The CiiAiRMA>7, But the point is such moneys as were collected from 
the laid-off employees was due to be reported to the Mount Vernon 
Life Insurance Co. offices in Mount Vernon, N.Y. 

Mr. FiNDLAY. That is so. 

The Chairman. And for the period of April 1954 through February 
1957 none of those funds had been accounted for, none had been paid 
into the Union Life Insurance Co. or accounted from by Mr. Dorfman? 

Mr. FiNDLAY. That is right. 

The Chairman. All right. I think we have it. 

]Mr. FiNDi^Y. In addition to that, I would like to add, however, 
that the accountants. Miller, Mandel & Co., who make the audit of 
the Union Insurance Agency books, kept memorandum records of the 
amounts that were due, and in their review notes in connection with 
the payment in February, they state that — 

the fiduciary premium account, and due to the Mount Vernon Life Insurance 
Co., do not appear on any books, although we have not determined that the bank 
account was used to discharge tlie liability. 

In other words, they are covering themselves with respect to the dis- 
position of these funds. Actually, the accounting for these funds 
was maintained on memorandum records only in a manner that would 
be difficult to trace. 

Mr. Kennedy. They did not appear on any regular boolcs or 
records ? 

Mr. FiNDLAY. They did not appear on the general books of the 
U^nion Insurance Agency or Aldor Insurance Agency. 

Mr. Kennedy. And, as a matter of fact, the insurance company in 
New York had no way of knowing that this $51,000 was due to them; 
is that right ? 

Mr. FiNDLAY. None whatsoever. In fact, the amount might be 
greater than $51,000, because if there were some cash payments, be- 
cause of the manner in which the records were kept, they could have 
been put in a drawer, or in a tin box and not deposited in the bank 
account. 

Another feature of this 

Mr. Kennedy. So this misappropriation went on over a period from 
1954 to 1957 and ended up with this $12,000 ? 

Mr. FiNDLAY. Yes. 

Mr. Kennedy. And it totaled $51,000? 

Mr. Findley. That had been paid. 



16026 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. In that connection, as I understand it, Mr. Dorf- 
man was using this account all during that period of time for his own 
purposes, by drawing checks on it, checking on it, and using those 
funds for purposes other than for w^hat they were received. 

Mr. FiNDLAY. Yes. We have photostats of the 18 checks that were 
drawn on the account. Three checks were missing. We were unable 
to obtain photostats of them. That represents the $47,544 which he 
used to finance his own operations. 

Another feature of this is that during the period of the withhold- 
ing of the funds, Allen Dorfman was processing claims filed by the 
laid-off employees, in some cases death claims, totaling $4,000, $:2,000, 
$2,500, various amounts. We made a test of that and we found $17,500 
worth of death claims paid by the Mount Vernon Life Insurance Co. 
to the policy holders for which they had not received the premiums. 

The Chairman. In other words the Mount Vernon Life Insurance 
Co. was honoring the contract they had, although they were not 
getting the premiums. 

Mr. FiNDLAY. That is right. The claims were filed through Allen 
Dorfman's office, and death claim benefits are paid by the Mount 
Vernon Life Insurance Co. from that office. The accident and health 
claims of these laid-off employees are also paid through the Chicago 
office, so that undoubtedly there were other claims paid by Dorfman 
covering accident and health, while all of the funds were being with- 
held. 

The Chairman. Are there any further questions ? 

All right, you may stand aside. Call the next witness, Mr. Kennedy. 

Mr. Kennedy. I call Mr. Uhlmann. 

The Chairman. This witness has been previously sworn. 

TESTIMONY OF MAETIN S. UHLMANN— Resumed 

The Chairman. You will remain under the same oath, and Mr. 
Kennedy will proceed. 

Mr. Kennedy. I am going back now to the operation of the insur- 
ance agency by Allen Dorfman, and their servicing of the insurance, 
Mr. Chairman, and I would like to have Mr. Uhlmann discuss briefly 
the situation regarding the retention rates of the insurance company in 
connection with their bid initially for the Central States insurance, 
and then later for the Michigan insurance. 

Mr. Uhlmann. With respect to the Central States policy. Dr. 
Perlman in submitting his bid included a retention rate of 171/2 per- 
cent which, of course, meant that was the percentage related to the 
premium dollars to be collected under that policy that would be kept 
by the Union Casualty Co., as it was called at that time. 

However, in his retention formula, he also had, shall I say, a "gim- 
mick" in there, in this sense: The first policy year for the Central 
States covered a 13-month period, and in his bid he stipulated that for 
purposes of computing the retention the first month's premium less 
the first month's claims would be retained by the company, that is the 
net. 

This was another way of saying that for the first month, specifically, 
March 1950, the Union Casualty Co. under that plan would have 
retained, as they did, 100 percent of the difference between the premi- 
ums collected and the claims paid. And for the remaining 12 montlis, 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16027 

that is, from April 1, 1950, through March 31, 1951, the 171/2 percent 
then conies into play, and as a consequence, by taking into consideration 
the aggregate premiums collected during this 13-month period in 
relation to the claims paid in the same period we found that the true 
retention by Union Casualty was a little over 21 percent. 

Mr. Kennedy. What was the retention rate of the Union Pacific Co. 
which was the low bidder for insurance? 

Mr. ITiiLMANN. The Pacific Mutual Co., you mean ? 

Mr. Kennedy. Yes. 

Mr. Ufilmann. That bid included a retention rate of 9.3 percent 
for the first year, as contrasted with some 21 percent for Union 
Casualty Co. 

Mr. Kennedy. Now, Mr. Uhlmann, the insurance company, Union 
Casualty Insurance Co., did not maintain the retention rate at I7y2 
percent for the following years. 

Mr. Uhlmann. Well, they retained I71/2 percent in the second 
policy year. It did not extend beyond 17i/^ percent as it did in the 
first policy year because it was only a 12-month policy year. How- 
ever, in policy years beginning April 1, 1952, they did not retain that 
percentage because the claims that had to be paid under that policy 
were so great that they could not maintain that retention figure. 

Mr. Kennedy. "WHiat has the retention amounted to over the period 
of the policy? 

Mr. Uhlmann. Over that policy period, the aggregate or the differ- 
ence between the total premiums received and the total claims paid, 
was about a little under $5 million. 

Mr. Kennedy. What is the significance of that figure? 

Mr. Uhlmann. Well, just this : That if, for example, there was not 
an insurance carrier or an underwriter in the picture, then obviously 
there would be no need for paying commissions or service fees which 
we discussed yesterday, nor would there have been any need for 
carrying the office overhead of the insurance underwriter, and to- 
gether with other expenses which come out of the retention. 

IVIr. Kennedy. It has cost the welfare fund that amount ? 

Mr. Uhlmann. The welfare fund paid an aggregate of under $5 
million for the operation of this insurance during this period of time. 

Senator Church. What period of time are we talking about now ? 

Mr. Uhlmann. We are talking about the period between March of 
1950 through March of 1958. 

Senator Church. An 8-year period ? 

Mr. Uhlmann. Yes, sir. 

Senator Church. "WHien you say the cost was $5 million, you mean 
by that that the cost of carrying the insurance program exceeded by 
$5 million the benefits paid out ; is that correct ? 

Mr. Uhlmann. That is riglit. It is simply the difference between 
premiums paid less claims paid. 

Senator Church. Now, to get that figure in some perspective, how 
does that $5 million relate to the total amount of premiums paid to the 
total amount of benefits ? How sizable is this in connection with the 
scope of the program ? 

Mr. Uhlmann. Well, the total premiums paid in this period of 
time was roughly $51 million, and the claims paid were approximately 
$46 million. Now then, the point that I was about to make, Senator, 



16028 IMPROPER ACTIVITIES IN THE LABOR FIELD 

was this : It is recognized, I believe, that for a period of at least 3 or 
4 years of an operation of this size, and it is a very large one, this fund 
as was pointed out yesterday, is considered one of the very largest in 
the United States, and it covers members of the Teamsters in some 25 
States — after some 3 or 4 years one might conclude that the trustees 
in the interest of the members and their families and their dependents 
might have given serious consideration, if not adopt a different course 
of action in the light of the experience that had accumulated at that 
time. 

The thought that occurs to me, for example, I might say more so 
on the basis of conversations with experts in the insurance field, is 
that the trustees might have given some serious consideration or have 
adopted a self-insurance program or have considered transferring this 
insurance to another carrier where the retention would have come 
closer to a little over 3 percent, let us say, or a maximum of 4 percent, 
as opposed to an overall average of about 9 percent, which was the 
case in the Central States over this 8-year period. 

Senator Church. In other words, the experience over the 8-year 
period showed that the actual cost to the Teamsters of carrying this 
insurance was excessive, as compared to alternatives available. 

Mr. Uhlmann. Yes, sir. 

Senator Church. And after a 3- or 4-year period ordinary prudent 
management, in the interest of the Teamsters themselves, would have 
indicated the advisability of transferring this to another carrier or 
instituting a program of self -insurance. 

Mr. Uhlmann. Yes, sir. A reexamination, let us say, at the end of 
the fourth year or thereabouts, and this is not a case of Monday morn- 
ing quarterbacking, I would like to add, I believe that this reexamina- 
tion would have led to the alternative of these two measures that we 
are now discussing. 

As a consequence, the savings in money to the Central States Wel- 
fare Fund would have been a minimum of about 4 percent. That is 
a minimum of that, between 1954 and 1958,' if they carried the cover- 
age with another company. 

Senator Church. Just to be sure that I miderstand the testimony 
correctly, you say that the experience that tliey actually had over the 
8-year period involved a retention of about 9 percent ? 

Mr. Uhi^mann. Yes, sir. 

Senator Church. And general experience in the insurance business 
and alternatives available to them would have permitted them to have 
obtained tlie same insurance coverage at a retention figure of about 
4 percent ? 

Mr. Uhlmann. At a maximum of 4 percent. 

Senator Church. So that actually they were paying twice as much 
as prudent management would have dictated. 

Mr. Uhi,mann. Yes, sir. 

vSenntor Church. Is that correct ? 

Mr. Uh I. "MAN Is. Yes, sir; in my opinion, and m the jiidgtnent of 
experts. 

Senator Cihtrch. Can you give me that figure or can you translate 
that figure from a percentage figure to a dollars and centi? figure? 

Mr. TThlmann. I can give you an estimate of it, Senator. Eoughly 
$2,400,000 would be involved. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16029 

Senator Chfrch. So tliat it Avoiild be fair to say then that the con- 
tinuation of this insurance projjrani after a fair trial period had 
cost the Teamsters, tlie men who drive the trucks, $2,400,000 more 
than it should have cost them ? 

Mr. T'tilmaxx. I would like to ooi-rect that. If we commence with 
the end of the fourth year, the calculations w^ould indicate that the 
excess in those circumstances would be roughly $1,800,000. 

<inf^n,ff^j. rHTRrii. Correctin<r my statement then, from $2.4 million, 
to $1.8 million, then my statement is correct ? 

Air. I Hi^EAxx. ^'es. sir. 

Mr. Kexxicdy. The $2.4 million is from the beginning of the policy. 

Mr. Uhlmann. That is right. 

Senator Churcit. And the $1.8 million would be from the time when 
experience under the policy would have indicated a change of course 
to be pi'udent. 

Mr. Uhlmann. Yes, sir, and that is attributable largely to the very 
rapid growth of the number of members and dependents, too, in that 
fund, which in turn meant a very great acceleration in terms of pre- 
mium dollars collected. 

]Mr. Kenxedy. And most of this excess of money that has been paid 
by the Teamsters had been paid in order to meet the charges that have 
been made b}^ Allen Dorfman, and Rose Dorfman, and Dr. Perlman ; 
is that correct ? 

Air. I'hlmank. Oh, yes, by far. 

Air. Kexxedy. The excess of payments have been necessary in order 
to meet the charges made by these individuals ? 

Mr. Uhlmann. Yes, because commissions and service fees by far 
represent the largest part, or comprise the largest portion of the money 
that is spent by an insurance underwriter out of its retention, and 
thei-efore the statement made. Air. Counsel, is precisely correct. 

Air, Kenx'edy. It has not been that the underwriter has received a 
great deal extra amount of money in this. 

Air. UiiLMAX^x. Oh, no. The net to the underwriter, this would have 
no effect upon the net to the underwriter. Aly discussion here is con- 
centrated on the impact that this had on the w^elfare fund itself. 

Sitting from that side of the table, as I pointed out earlier a rather 
thorough reexamination of the entire problem would have dictated a 
different course of action. 

Air. Ken^x^edy. So now we have gone through the excessive cost to 
the Teamsters and we have gone through the excessive payments to 
Allen Dorfman, and to Rose Dorfman, and to Dr. Perlman. 

Now, let us take it down to what the immediate effect was on the 
Teamster member. Did we find that because of these excessive costs 
that had to be paid, the Teamsters agreed to reduce the benefits to the 
individual members? 

Air. Uhlmaxx. Yes, sir. 

Air. Kexxedy. "Wlien did they reduce the benefits? 

Air. Upilmaxx. I would like to add just one point here, and that is 
that our comments until now have been confined to the Central 
States. It seems to me that we should not overlook the impact that 
this had on the Alichigan Conference of Teamsters Fund, which is a 
very large one, and again the remarks in the main that I made in refer- 
ence to the Central States Health and Welfare Fund apply to the 
Alichigan Conference Welfare Fund. 



16030 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. In other words, there is a corresponding overcharge 
to that fund as you have outlined with reference to the Central States. 

Mr. Uhlmann. Yes, Mr. Chairman. 

The Chairman. It is comparable ? 

Mr. IJhlmann. The figures are smaller only because the fund it self 
does not have the same volume that the Central States has. 

The Chairman. But percentagewise, it could be applied ? 

]\Ir. Uhlmann. Yes, sir. 

Mr. Kennedy. Would you have a figure on that, Mr. Uhlmann, 
the Michigan Conference ? 

Mr. Uhlmann. On the Michigan Conference, the aggregate as I 
pointed out earlier, and in that case there is a 1-year less period in- 
volved, from 1951 through 1958, and excluding the first 4 ^^ears, which 
seems to me to be reasonable for a welfare f mid to have made a study, 
in localizing the excess cost to the fund, if it were either carried with 
another carrier or self- insurance, figure there woidd be roughly 
$500,000. 

Mr. Kennedy. Now let us go on to the reduction of benefits. 

Mr. Uhlmann. In considering this, or in approaching this question 
of reduced benefits, I should like to point out first that I have before 
me the material relating to the Michigan Conference of Teamsters 
Welfare Fund when we found an increase in the commissions to the 
agency in Chicago. For example, commencing with January of 1952, 
the commissions were increased from 2 to 3 percent; and on July 1, 
1952, they were again increased from 3 to 4 percent; and on top of 
that there was a 2 percent commission and a 2 percent service fee 
added for life insurance portions of the policy. So that the difference 
in commissions over and above what had been paid before that, in this 
2-year period, between 1952 and 1954 when these cuts in benefits took 
place, was roughly $54,000. 

Now then, beginning with April of 1952 there was an increase in 
premiums of 15 cents a member a month, and in the case of depend- 
ents it was 10 cents per dependent wife per month. 

On April 1, 1952, the very same date, when the policy was renewed 
for the first time with the Union Casualty, the hospital benefits or 
hospital expenses on maternity coverage was reduced from $160 to 
$120. Obstetrics for dependents, that was cut from $75 to $50. Then 
beginning on June 1, 1953, a series of very sharp and drastic cuts in 
benefits took place. For example, the largest single one concerned 
the maximum allowable for surgery for dependents, cut from $300 
to a maximum of $200. 

So what we have here, in a word, is this: We have concurrently 
with increases in commissions and services fees, increases in premiums 
and decreases in benefits. 

Mr. Kennedy. And at the same time we have had the testimony 
before the committee from experts that the commissions that were 
being pnid to the Dorfmans and to Dr. Perlman were excessive, even 
at that time. 

Mr. Uhlmann. Yes, sir. 

I have before me a communication which I should like to point to 
briefly. It is written by an officer of the Union Casualty & Life 
Co., as it was called then. It was written on April 8, 1952, to Dr. 
Perlman, in which he said that — 

At the meeting in Chicago with Mr. Hoffa and Mr. Schwartz — 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16031 

"who at the time was the administrator for the Michigan Conference 
of Teamsters Welfare Fund — 

and in the presence of Mr. Allen Dorfman and jourself and the writer — 

who is Mr. Smith — 

they had discussed this entire question as to what to do with regard to renewing 
the policy of the Michigan Conference Insurance beginning April 1, 1952, and 
it was at that time agreed at that meeting that the premiums would be increased 
and that the dependent coverages — 

which I referred to a moment ago — 

would be cut in the manner described. 

Now, at this point, of course, it raises a question, and perhaps a 
serious one, as to the authority of those present to negotiate these 
matters in the light of the fact that none of the trustees of the Michigan 
Conference Welfare Fund were present. 

The Chairman. Let us identify that document. What is it? 

]Mr. Uhlmann. It is a document written by Mr. Smith to Dr. 
Perlman and the subject is Michigan conference renewal, and it is 
dated April 8, 1952. 

The Chairman. That document may be made exhibit No, 224. 

(Document referred to was marked "Exhibit No. 224" for reference 
and may be found in the files of the select committee.) 

Mr. Uhlmann. I have another document before me, written by Mr. 
Fitzsimmons, who was the employee trustee on the fund, addressed 
to Dr. Perlman, in which he concurs in the benefit reductions and 
increase in premiums agreed to or as covered by the communication 
that I just referred to. 

The Chairman. That document may be made exhibit 224A. 

(Document referred to was marked "Exhibit No. 224A" for refer- 
ence and may be found in the files of the select committee.) 

Mr, Uhlmann. There is some indication that Mr. Fitzsimmons' 
letter may have been backdated to April 8, because on April 10, 1952, 
there is another memorandum from Mr. Smith to Dr. Perlman in 
which lie refers to a telephone conversation between himself and 
Mr. Ploffa and Mr. Brennan, during which the three of them had 
discussed this identical problem; that is to say, benefit reductions 
and premium increases. 

As I pointed out earlier, none of these parties were trustees of the 
welfare fund. 

INIr. Kennedy. And, therefore, had no right whatsoever in making 
these decisions ? 

Mr. Uhlmann. That is correct. 

Mr. Kennedy. This is a meeting that took place between Mr. HofTa, 
Mr. Schwartz from the welfare fund, and Mr. Allen Dorfman, the 
agent ; is that right ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. In December of 1956, the benefits of new members 
in both groups and their dependents were cut 50 percent for the first 
year; is that right? 

Mr. Uhlmann. That is right. 

Mr. Kennedy. So that was another cut? 

Mr. Uhlmann. That was anotlier cut effective at that time, and it 
applied to new members during the course of their first year of em- 



16032 IMPROPER ACTIVITIES IN THE LABOR FIELD 

ployment only. That is to say that following the first year, their 
benefits would be restored to 100 percent. 

But in this connection, I wish to make the point that the premiums 
paid for these people were identical with those for the members who 
received 100 percent benefits. Perhaps this was influenced or in- 
spired by the fact that the losses may have run a little high. 

Mr. Kennedy. It would appear to be that during this period of time 
there was a milking of funds by this group and really what amounted 
to a sellout by those who were making the decisions for the Teamster 
Union member. 

Mr. TThlmann. Yes, sir. 

Mr. Kennedy. During this period of time, did Mr. Dorf man's in- 
come increase tremendously ? 

Mr. TJhx,mann. "Well, as I mentioned earlier, I think, the buildup 
of the commissions, that is, over and above what he had already been 
receiving and which yesterday was testified to as having been exces- 
sive, the increase alone over and above what he had been normally re^ 
ceiving amounted to roughly $54,000, while these cuts had transpired. 

Mr. Kennedy. What about his income itself, item 3A in the memo- 
randum ? 

Mr. Uhlmann. We have found that from the time that Mr. Dorf- 
man entered the insurance business in 1949, that his income had grown 
rather sharply over the years in contrast to what it Avas a year or two 
before he went into the insurance business. 

Mr. Kennedy. Tell us what the situation is. 

Mr. Uhlmann. In 1948, which was the year preceding the one that 
he went into the insurance business, his taxable income was $5,094. 

Senator Church. Is this information taken from his income tax 
returns ? 

Mr. Uhlmann. Yes, sir. 

His insurance ii come — the figures I will cite from here on down will 
be the insurance income alone, the taxable income. 

In 1949, it was $5,200. In 1950, $16,500; in 1951, $25,391; in 
1952 

The Chairman. Wliat was 1951? 

Mr. Uhlmann. In 1951, $25,391. 

Mr. Kennedy. Just round the figures off. 

Mr. Uhlmann. In 1952, $41,700; in 1953, $129,000; in 1954, $166,- 
000 : in 1955, $86,000 : in 1956, $132,000 : and in 1957, $112,000. 

Mr. Kennedy. What about his mother, Rose Dorfman, who was a 
partner ? 

Mr. Uhlmann. Rose Dorfman? We have her tax returns com- 
mencing with the year 1950, when her income from insurance was 
$3,500 that year, and in 1951, $49,000; in 1952, $94,000; in 1953, $119,- 
000; in 1954, $156,000; in 1955, $76,000; in 1956, $115,000; and in 1957- 
$84,000. 

The Chairman. As I recall from other testimony, if I am correct, 
90-odd percent of all of the iiicomc of tlia Dorfmaivs was froi:-. the^se 
three accounts. 

Mr. Uhlmann, Yes, sir ; that is correct. 

The Chairman. So this represents profit, both the income of Allen 
Dorfman and that of his mother, profit primarily from these three 
accounts, the Central States conference, the Michigan conference, 
and local 1031 ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16033 

Mr. Uhlmann. Yes. 

The Chairman. As I remember, about 90 percent. 

Mr. Uhlmann. About 92 percent, roughly. 

The Chahjman. Roughly 92 percent of this income was from those 
three accounts ? 

Mr. Uhlmann. Yes, sir. 

Senator Church. This income, as you have indicated, was taken 
from their own reports on their own income tax returns; is that 
correct ? 

Mr. Uhlmann. Yes. They paid taxes on these sums of money. 

Senator Church. This is what they reported to the Government 
as their income and paid taxes on ? 

Mr. Uhlmann. With respect to insurance. I did not take into 
account here any investments, for example, in some oil operations 
and so on. 

Senator Church, "\^^lat I want to get at is this : Are any of these 
figures based upon any audit made of the books of these parties, or 
any other source of confirmation other than what they themselves 
reported in their tax returns ? 

Mr. Uhlmann. The information contained in the tax returns we 
have found, except for the first year or two when amended returns 
were filed to conform with what had actually transpired, we found 
that in the main they did correspond with the income that should have 
been reported, if that is your question. 

Mr. Kennedy. Mr. Uhlmann, are you talking about the moneys 
that they charged to expenses? Are you saying that we are verifying 
that amount of money ? 

Mr. Uhlmann. No, no. I didn't intend that. I am sorry. 

Mr. Kennedy. "Would you straighten out your answer? 

Mr. Uhlmann. By your question, Senator, you meant that we had 
established that this income, in fact, is the sum of money that should 
have been reported on the basis of their books and records? 

I must say that we did not have the opportunity to examine all of 
the books and records and for this reason we are not in a position to 
establish whether this represents a true figure on which the taxes 
should have been paid. 

Senator Church. Thank you. 

Mr. Kennedy. They de<ilared, anyway, from 1953 through 1957, 
from this insurance agency, at least $1,150,000 in profits; is that 
correct ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. That was from 1953 to 1957 ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. At the same time. Dr. Perlman was doing quite well ; 
is that right? 

Mr. Uhlmann. Yes, he was. 

It should be pointed out in this respect that nearly all of Dr. Perl- 
man's income, of course, came from union welfare funds of different 
sorts. In other words, there was some union somewhere paying for 
this money. A good share of it, beginning in 1950, of course, was 
attributable to the Teamsters and some of the other policies which 
came in through the Chicago office. 

Senator Church. Let me ask this question : In the course of your 
studies of this matter, did you have an opportunity or did you under- 



16034 IMPROPER ACTIVITIES IN THE LABOR EIELD 

take to make any kind of comparison between the benefits conferred 
by this insurance program for the policyholders after the benefits 
were curtailed, and after the premiums were increased, with other 
insurance carriers offering programs of this kind, or is such a study 
feasible ? 

First of all I would like to know if that comparison has been made^ 
and if it is feasible to make such a comparison, just to ascertain the 
extent to which the Teamsters were being shortchanged, 

Mr. Uhlmann. I would say that it is exceedingly difficult to make 
comparisons, per se, largely because we are dealing here with some 
extraordinarily large welfare funds, with, extensive membership, and, 
as a matter of fact, sitting here now I have no information and have 
found none where another welfare fund of the size, let us say, of 
Central States, Southeast and Southwest Health and Welfare Fund, 
with that sort of membership, is carried by another carrier. 

Senator Church. The problem is you had nothing really com- 
parable with which to draw comparisons ? 

Mr. Uhlmann. No, sir. Comparisons have been attempted from 
time to time by other people, but I, myself, would be reluctant to make 
one. 

Mr. Kennedy. Would you like to give us briefly the situation as 
far as Dr. Perlman is concerned? I would like to get through that 
subject and one other before we recess this morning. 

Mr. Uhlmann. In 1952, the New York State Insurance Depart- 
ment made a rather exhaustive investigation into the relationships 
between the Union Casualty Co., which was then run almost entirely 
by Dr. Perlman, and the United Public Service Corp., which 
he had set up, which he also had run, and United Public Service was 
largely, if not entirely, an agency, an insurance agency, that was set 
up for the purpose of having large sums of commission and service 
fee money funneled through it, from which Dr. Perlman was the 
largest single beneficiary. 

Over the years he had accumulated, as a result of this funneling 
operation, both through the United Public Service and the Union 
Casualty Co., an aggregate of about $1 million. "Wlien the New York 
Insurance Department, the New York State Insurance Department, 
was aware of this, they directed the carrier to terminate its contract 
with the United Public Service on the ground that it was hardly 
justifiable. 

In so doing, the United Public Service, or I should say specifically 
Dr. Perlman, entered into an arrangement between the two com- 
panies — it might have been almost a case where he was entering into 
a contract with himself, though I can't say as to that — in any case, 
when the termination took place, there was a provision that in con- 
sideration of the fact that the United Public Service had ostensibly 
or allegedly placed this insurance with the Union Casualty Co., which 
was the carrier, that at termination there should be some considera- 
tion for paying them a given sum of money each year so long as that 
insurance stayed on the books of the carrier. 

As of this date, there are four welfare funds still carried on the 
books of this company whicli today is known as the Northeastern Life 
Iiisui-ance Co., and they are tlie Central States, the Michigan confer- 
ence, the Local 1031, and another Teamster local in Chicago, and that 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16035 

is Local 743. They are the four welfare funds still carried on the 
books of this company for which the United Public Service since 
January 1, 1953, has been receiving an aggregate of $50,000 annually, 
and that sum will be paid in perpetuity; that is to say, so long as this 
business remains on the books of the Northeastern Life Insurance Co. 

It is another way of saying that this becomes a fixed charge which, 
in the iinal analysis, must be borne by these welfare funds, and is an- 
other way of saying, too, that had it not been for this lixed charge, 
that the premiums from these funds would be that much smaller, or 
that the Denelits would have otherwise been increased by that sum 
of money. 

Mr. Kennedy. That is $50,000 each year; is that correct? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. And he is no longer associated with the insurance 
companv? > 

Mr. Uhlmann. Dr. Perlman is no longer associated with this insur- 
ance company, but of the $50,000 he is still paid $5,000 a year. 

Mr. Kennedy. Where does the rest of the money go ? 

Mr. Uhlmann. Largely to the widow of one of his former col- 
leagues, who was associated with him in the United Public Service 
Corp. 

Mr. Kennedy. But that $50,000 has to be paid out by the insurance 
company every year? 

Mr. Uhlmann. Yes, sir. 

The Chairman. There is no benefit in return for it whatsoever ? 

Mr. Uhlmann. No, sir. 

The Chairman. It is just a pension being paid by that fund to 
someone ? 

Mr. Uhlmann. In essence ; yes, sir. 

The Chairman. That is what it amounts to? 

Mr. Uhlmann. Yes, sir. 

The Chairman. There are no benefits in return to the men? 

Mr. Uhlmann. No, sir. There is a very serious question. I know 
that the New York State Insurance people have been concerned about 
this arrangement for a long time, and I feel certain that they would 
like to see it broken off entirely. I rather suspect they may do some- 
thing about that if it is legally possible to do so. 

Mr. Kennedy. Of course, that is just one other item that increases 
the cost to the Teamster Union members and to the union members 
of local 1031 ? 

Mr. Uhlmann. That is correct. 

Mr. Kennedy. In the final analysis, they are the ones that are pay- 
ing for it. 

Mr. Uhlmann. Yes, sir. This money must come from these welfare 
funds. 

Mr. Kennedy. Has Mr. Dorfman been paying the life insurance 
premiums for several of the union officials? 

Mr. Uhlmann. Yes ; he has. 

Mr. Kennedy. Do you have that information ? 

Mr. Findlay, do you have that information ? 

What do the records show for Mr. Dorfman paying for the insur- 
ance premiums of certain officials ? 



\ 



16036 IMPROPER ACTIVITIES IN THE LABOR FIELD 

TESTIMONY OF JOHN P. FINDLAY— Resumed 

Mr. FiNDLAY. Mr. Dorfman, in addition to writing the group life 
insurance policies, also issues individual life policies to a number of 
union officials. The Northeastern Life Insurance Co. carries policies 
for Jimmy Hoffa, Eugene Sancucci, Don Peters, Ed Feimer, Frank 
Fitzsimmons, Irving Green of Mercury Records — 

Mr. Kennedy. Irving Green of Mercury Records ? 

Mr. FiNDLAY. Of Mercury Records. He is the only one who is not 
a union official. And Ted Shulman. He is connected with the Waste 
Trades Union. 

Mr. Kennedy. The Waste Trades Association ? 

Mr. FiNDLAY. The Waste Trades Association ; that is right. 

In addition to that, quite often there are applications filed by Allen 
Dorfman that in some cases are rejected by the Northeastern Life In- 
surance Co. One of those would be on the life of Johnny Dio. 

The question as to the payment of insurance premiums for certain 
union officials 

Mr. Kennedy. Wliat was the situation as far as Johnny Dioguardi 
was concerned ? 

Mr. FiNDLAY. Johnny Dio submitted an application tlirough Allen, 
and it was eventually rejected. But in the application Allen Dorfman 
as the agent was asked how long he knew the proposed insured, and he 
said in 1955 he laiew him for 10 years. He also stated that he knew 
his annual income, Johnny Dio's annual income, was $30,000. 

A specific question was asked: "Do you know of anything which 
might make this risk undesirable ?" He said, "No." 

Subsequently, the company, of course, rejected the application on 
the basis of their credit information. In the case of Johnny Dio, 
Johnny Dio gave Allen Dorfman a check for $684 to cover the pre- 
mium on his life insurance for 1 year. He gave him that check on 
March 21, and the check bounced on March 28. 

It was redeposited on March 31 and it bounced again on April 7. 
Tliere was another deposit on April 7, and the check bounced on April 
19. 

The Chairman. Three bounces so far ? 

Mr. FiNDLAY. Three bounces. In th.e meantime, Allen Dorfman 
had advanced to the Mount Vernon Life Insurance Co., througli his 
Dover Insurance Co., its check, its own che<>k, for $684 in order to 
make the premium payment to the Mount Vernon. 

Mr. Kennedy. For »Tohnny Dio? 

Mr. FiNDLAY. For Johnny Dio's account. Even though he had 
trouble in connection with the personal checks bouncing, there was 
no communication with the Mount Vernon Life, and it wasn't until 
July 8 when Mount Vernon Life decided to reject the application of 
Dio for cause that the money was returned to the Dover Insurance. 
So actually it was a wash entry on the Dover Insurance accounts with 
respect to Johnny Dio. 

The Chairman. You mentioned a number of union officials and 
others that I understand from your testimony, INIr. Dorfman pays 
their insurance premiums. Is that right? 

Mr. Kennedy. That first list, INIr. Chairman, is a list of individuals 
where Allen Dorfman writes their insurance. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16037 

The Chairman. He writes their insurance ? He does not pay their 
premium? 

Mr, Kennedy. Now he will go into that. But that is a list of indi- 
viduals for whom Allen Dorfman writes insurance. 

Mr. FiNDLAY. He does write certain insurance other than the group 
insurance we have beon discussing. 

The Chairman. This is individual insurance? 

Mr. FiNDLAY. This is individual life insurance. 

The CuAiRMi^N. All right. 

Mr. Kennedy. Going back briefly, another individual who ap- 
plied for insurance and who was recommended by Allen Dorfman was 
Gus Zapas; is that right? 

Mr. FiNDLAY. Gus Zapas' application, I believe, was approved, but 
Gus didn't make the payment so the policy was never issued by the 
Northeastern Life Insurance Co. 

Mr. Kennedy. He is the one you might remember, Mr. Chairman, 
who served a term in the penitentiary in Indiana, and who has been 
arrested 45 times. He was having such a difficult time getting a job 
in Chicago he was hired by the Teamsters in Indiana. He had been 
arrested many times in Chicago. 

Mr. FiNDLAY. The personal insurance goes through the books of 
the Dover Insurance Agency, Ltd. On February 28, 1958, the latest 
available balance sheet that I was able to get, the books showed that 
there were advances for policyholders. That was the caption of ac- 
counts receivable used by their accountants. It showed that there 
was some $3,6UU due, from James Hoft'a, $726 representing a payment 
in August 1956. 

The Dover Insurance check was No. 576, and that was for $726. 
That is a semiannual premium on behalf of Jimmy which has not been 
reimbursed to Allen, and no interest is being charged on the books. 

The Chairman. What is the date of that? 

Mr. FiNDLAY. August 1956. 

The Chairman. It has never been paid 

Mr. FiNDLAY. It has not been paid. 

Other semiannual payments are sometimes made direct to the in- 
surance company in Mount Vernon and they have no way of deter- 
mining from whom they receive the money. But actually, there is 
only one semiannual payment appearing on the books as still due from 
Jimmy. 

In addition to that, there is a balance of $694.30 due from Eugene 
San Soucie and his wife, Adele. That represents payments made in 
1956 and 1957 for which San Soucie made partial payments, two pay- 
ments of $480 and $500 to Allen. Those were reflected on the books 
of Dover. 

Frank Fitzsimmons owes a balance of $112.?)6. It is just a portion 
of a premium paid through the Dover on behalf of these individuals. 

Phil Goodman owes $1,079.99, and the others, $989.47. That 
amount of $3,602.05 appears on the balance sheet prepared by Miller- 
Mandell & Co. for management purposes for Allen Dorfman. 

Mr. Kennedy. Is that illegal, to pay the insurance premiums for 
an agency? 

Mr. FiNDLAY. In the case of the payments where no interest is 
charged, we have been informed bj^ the Illinois Insurance Department 

3G751 — 59— pt. 43 7 



16038 IMPROPER ACTIVITIES IN THE LABOR FIELD 

that it is considered in the nature of a rebate and is illegal. In the 
case of New York, I am not sure what interpretation they would 
put on it. 

Mr. Kennedy. But in Illinois it is illegal ? 

Mr. FiNDLAY. It is ; yes. 

The Chairman. Before we recess, the Chair will make the memo- 
randum that the witness testified to a while ago, dated April 10, 1952, 
to Dr. Perlman from Mr. Smith, exhibit No. 224B. 

(The memorandum referred to was marked -"Exhibit No. 224B" 
for reference and will be found in the files of the select committee.) 

The Chairman. The committee will stand in recess until 2 : 30 p.m. 

(Members of the select committee present at time of recess: Sena- 
tors McClellan and Church.) 

( Wliereupon, at 12 : 35 p. m., the select committee recessed, to recon- 
vene at 2 : 30 p.m. the same day.) 

AFTERNOON SESSION 

The Chairman. The committee will be in order. 
(Members of the select committee present at the convening of the 
afternoon session were Senators McClellan and Ervin.) 
The Chairman. Call the next witness. 
Mr. Kennedy. I would like to recall Mr. Uhlmann. 

TESTIMONY OF MARTIN S. UHLMANN— Resumed 

Mr. Kennedy. Now, another subject in connection with the insur- 
ance, Mr. Uhlmann, is the excessive claim reserves set up by the Dorf- 
mans. Can you explain that to us? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. And what do the figures show ? 

Mr. Uhlmann. Well, I do not believe that is attributable to the 
Dorfmans. These reserves are officially, at least, set up by the under- 
writer at Mount Vernon, and what we have done is to analyze all of 
the claim payments made after April 1 of 1958, which is the first 
month of the present policy year, and made a study of those claims 
that were paid after April 1 to determine those on which the claims 
were incurred prior to March 31, or March 31 and prior, concerning 
which a reserve has been set up to meet those claims. What we found 
was that in the case of Central States as well as INIichigan Conference, 
there was a rather substantial overstatement of those reserve figures as 
of last March in relation to claims paid through October 31, 1958. 

Generally speaking, I might add the claim payments for a period 
extending from April 1 through October 31 are generally regarded, 
with some few exceptions, to be sufficient to cover nearly all claims 
incurred prior to the present policy year. 

On that basis, we have projected the overstatement in tlie case of 
Central States, for example, to be approximately 28 percent over and 
above the reserves set up at the end of the policy year, which was 
March 31, and in the case of the Michigan Conference Welfare Fund, 
the reserves were overstated by as high as 37 percent. 

In each case, the percentages are regarded as being extraordinary. 

Mr. Kennedy. What would the ordinary reserve percentage be in 
the ordinary policy? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16039 

Mr. Uhlmann. In discussing this matter with State insurance de- 
partment officials, as well as those in other insurance companies, that 
is otlier than the particular company we were concerned with in this 
investigation, we understand that the average overstatement gener- 
ally runs somewhere between 5 and 8 percent, and sometimes, in ex- 
traordinary cases, as high as 10 percent. Anything rumiing beyond 10 
percent is regarded as extraordinary. 

Mr. Kennedy. And so the Central States, we found, ran up to 28 
percent, or ran 28 percent, and the Michigan Conference ran 38 
percent. 

Mr. Uhlmann. It was 37 percent. 

Mr. Kennedy. Wliat that means as a practical matter is that there 
are these large amounts of money that are available to the insurance 
company; is that not correct? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. That they can use during a period of a year, which 
are charged to reserves but can be used by the insurance company 
during that period of a year for whatever purpose they see fit. 

Mr. Uhlmann. Yes, sir, and as a matter of fact they do precisely 
that. 

Mr. Kennedy. What would have happened to that money if it was 
not made available to the insurance company, and where would that 
money have gone otherwise ? 

Mr. Uhlmann. If the rate of retention that we discussed this morn- 
ing was not as high as 171/^ percent, but rather closer to a rate, let us 
say, of some 4 percent or so, which another carrier, a larger one, might 
have been willing to carry these very large coverages for, then it is 
safe to say without a question that these excess reserves would have 
been refunded to these welfare funds in their entirety. 

(At this point Senator Mundt entered the hearing room.) 

Mr. Kennedy. Now, there is another subject I wish to touch on. 
Have you finished with the reserves ? 

Mr. Uhlmann. Yes, sir. 

Mr, Kennedy. Do you have some figures there that we can place 
in the record to support your testimony ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. You have a memorandum that we can submit to the 
committee ? 

Mr. Uhlmann. I think that I recall the figures. The figures in 
the case of Central States, with respect to excess reserves, are $800,000. 
In the case of Michigan Conference it is $440,000, or an aggregate of 
$1,240,000 for both funds. 

Mr. Kennedy. That is for this year ? 

Mr. Uhlmann. That is for the policy year that ended last March. 

Mr. Kennedy. March of 1958 ? 

Mr. Uhlmann. March of 1958 ; yes. 

Mr. Kennedy. Did you find from a study of the reserves procedure 
that this same kind of operation occurred each year, excessive reserves? 

Mr. Uhlmann. We did not make a study, I am sorry to say, for any 
prior year. The undertaking is quite extensive and the only oppor- 
tunity we had was to have it done for the end of the current year since 
we were concerned with the present status of these reserves. 



16040 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. Couldn't you tell from how much was charged to 
reserves and how much actually paid in claims, whether the charges 
to reserves were excessive during the previous year ? 

Mr. Uhlmann. No, we could not, because unless a very exhaustive 
analysis is made for each year, it could not be done on the ground that 
one must make a clear segregation between claims paid in a particular 
year that has application to claims incurred in the previous policy 
year. 

Mr. Kennedy. Did Mr. Hoffa arrange for the welfare fund to invest 
$350,000 in this insurance company ? 

Mr. Uhlmann. Yes. We have evidence to that effect. 

Mr. I^NNEDY. Will you tell us what the situation is briefly with 
respect to that ? 

Mr. Uhlmann. In testimony a few years ago before another con- 
gressional committee, Mr. J. Howard Minnich, who was then, and 
he is now, an employer-trustee of the Michigan Conference Health 
and Welfare Fund, stated that before the investment was initially 
made in what was then called the Union Casualty Co. in August of 
1951, that in considering the company in which an investment should 
be made it was decided that a safe place would be the Union Casualty 
Co. stock, and he indicated at the time that although he had discussed 
it with Mr. Fitzsimmons, who was then, as he is now, the employee- 
trustee on the fund, that he had discussed it not only with him, but 
also Mr. Hoffa was present. 

Mr. Kennedy. So the welfare fund now has a further reason, since 
1951, and almost an obligation, to retain this insurance company be- 
cause of the fact that they have an investment of some $350,000 in it? 

Mr. Uhlmann. That question has been raised many times. 

Mr. Kennedy. I just asked you a question. 

Mr. Uhlmann. I beg your pardon. Yes, mv answer to that would 
be "Yes." 

Mr. Kennedy. And if the Teamsters pull out their insurance, this 
insurance company itself has very few other accoimts; is that not 
correct ? 

Mr. Uhlmann. That is correct. 

Mr. Kennedy. And could not survive without the insurance of the 
Teamsters ? 

Mr. Uhlmann. As a matter of fact, before the present management 
bought control into the company, an actuarial study was made by 
those people and this person had stated tliat in his judgment if the 
two funds were to withdraw from this company, it would set the 
company back approximately 7 years. 

Mr. Kennedy. Let me ask you about another matter. 

Do we find that Mr. Hoffa — you gave an instance this morning — 
personally negotiated some of the policy decisions and the insurance 
terms of the welfare fund? 

Mr. Uhlmann. Yes, we did find such evidence. 

Mr. Kennedy. Was that a violaticm of the law ? 

Mr. Uhlmann. Well, under section 302(c) (5) of the Taft-Hartley, 
it is stipulated tliat with respect to trustee welfare funds only trust<>es 
of such funds uuiy negotiate insurance for one thing and liave any- 
thing to do with the operations of the fund itself, particularly where 
the emi)l()yees are engaged in interstate connnerce, which is the case 
with respect to the Teamsters. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16041 

Mr. Kennedy. What evidence do we have that he personally engi- 
neered the negotiations^ 

Mr. Uhlmaxn. I have a letter before me dated March 7, 1952, 
from Dr. Perlman to Mr. Hofl'a in which he says that he tried to reach 
him, Iloffa, by telephone several times because he wanted to discuss 
with him the matter of renewing the Michigan conference policy as 
of April 1, 1952. 

In response to that, at the time, Mr. Hoffa was at Hot Springs, 
Ark., and he wired Dr. Perlman to the effect that he was not well 
and he would not be able to return until the middle of April to sign 
the contract. 

On March 24, 1952, there was a letter written by Dr. Perlman to 
Mr. Allen Dorfman in which Dr. Perlman refers to the telegram from 
Mr. Hofl'a indicating that he would not be able to negotiate and sign 
the contract for the following policy year because he was in Hot 
Springs for his health. He then pointed out some other factors that 
are not particularly relevant, but this correspondence is aimed at this 
question. 

We now have a letter dated April 1, 1952, from Dr. Perlman to Mr. 
Hoffa, in which he states that it is his desire to have an increase in the 
premiums of 25 cents a member per month, and that he wants the 
surgical benefits for the dependents reduced from $300 to $200, and 
that he wants the hospital expenses of the dependents reduced from 
$160 to $120. 

The Chairman. Wliat communication are you testifying from now ? 

Mr. UiiLMANN. I am testifying from a letter written by Dr. Perl- 
man to Mr. Hoffa dated April 1, 1952, with reference to the renewal 
of the Michigan Conference of Teamsters Insurance Group Policy 
for the second policy year. 

The Chairman. L«t these letters and documents from which the 
witness has been testifying be made exhibit 225 A, B, C, and in the 
order of his reference to them. 

(Tlie documents referred to were marked "exhibits Nos. 225 A, et 
seq" for reference and may be found in the files of the subcommittee.) 

The Chairman. Now, you may continue if you have other docu- 
ments, and they will be made a part of exhibit 225 identified by letters 
in the order that you refer to them. 

Will you proceed? 

I am referring to docimients and letters pertaining to this subject 
matter in particular. 

Mr. Kennedy. I do not think it is necessary to go through all of 
them, and you gave us one instance. At the beginning he indicated 
by the exchange of correspondence that Mr. Hoffa was not going to 
be able to get back in time to negotiate on this matter, and that later 
on the correspondence showed that he returned and he was able to 
participate? 

Mr. Uhlmann. Yes, and he did. 

The Chairman. About what date did he participate, after his 
return ? 

Mr. Uhlmann. It was April 8, 1952. That was read into the rec- 
ord this morning. 

The Chairman. All right. 

Mr. Kennedy. Have you made all of those letters a part of the 
record ? 



16042 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Uhlmann. Yes. 

Mr. Kennedy. Then there was a letter on April 8, 1952, where the 
representative of the company addresses an envelope to Dr. Perlman 
and tells him not to be sending all the correspondence to Mr. Hoffa ; 
that for the record's sake, at least, it should be sent to the trustees ; is 
that right? 

Mr. Uhlmann. Yes, sir. We have a letter written by Mr. Schwartz 
to Dr. Perlman, pointing out to him that correspondence — this letter 
is dated April 8, 1952 — pointing out to him that correspondence relat- 
ing to welfare fund operations have theretofore been addressed to Mr. 
Hoffa, and he admonishes Dr. Perlman for it, and urges him to have 
those communications addressed to the trustees in the future as a mat- 
ter of record. 

The Chairman. That letter will be made exhibit No. 226. 

(The letter referred to was marked "Exhibit No. 226" for refer- 
ence and will be found in the appendix on p. 16184.) 

The Chairman. As I understand from that, although the letter 
will speak for itself, according to your interpretation of it, appar- 
ently Mr. Hoffa was bossing the fund. There wasn't any question 
about that, but just for the appearance of the thing, that letter re- 
garding it, instead of being addressed to Mr. Hoffa, should be ad- 
dressed to the trustees ; is that correct ? 

Mr. Uhlmann. Yes, sir. 

The Chairman. Very well. 

Mr. Kennedy. Now, I think we might call Mr. Findlay to go into 
the checks that have been written to cash and checks that have been 
written to Mr. Allen Dorf man. 

The Chairman. Mr. Findlay, come forward. 

TESTIMONY OF JOHN P. FINDLAY— Eesumed 

Mr. Kennedy. This, Mr. Chairman, we also consider of extreme 
importance. This money all went to Allen Dorfman. Our attempt 
is to try to trace it from there. Mr. Findlay will show what the 
records of Mr. Dorfman show concerning the disposition of these 
large sums of money. 

The Chairman. Wliere were these sums of money derived from 
which you are speaking of at the present. Wliat are the sources of 
the funds ? You say they all went to Mr. Dorfman. 

Mr. Findlay. We obtained certain checks from the insurance com- 
pany in Mount Vernon; we obtained checks from Allen Dorf man's 
personal account; and we reviewed the checks drawn by the Allen 
Dorfman entities. 

In addition to that, we also checked on certain personal bank loans 
which Mr. Dorfman had made. The review was made of these items 
for the period from 1949 to 1957. There was a total of $332,427 of 
checks. 

The Chairman. How much ? 

Mr. Findlay. $332,427. It comprises checks drawn to the order of 
Allen Dorfman and cashed, totaling $270,508. 

Tlie Chairman. Is that a part of the $332,000 ? 

Mr. Findlay. It is a part of the $332,000. 

The Chairman. What was the amount ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16043 

Mr. FiXDLAY. $270,508. There were 153 checks inchided in that 
total which we have, eitlier the originals or photostats thereof, sliow- 
ing that Allen Dorfman personally cashed these checks. They were 
not deposited in his personal bank account. 

The balance of $61,919 represents items that were drawn through 
Allen Dorfman's personal checking account. The checks were miss- 
ing, had apparently been withdrawn, and since we were unable to 
deteiTTiine who the payee was, Allen maintaining that he does not 
keep a check-stub book, we considered that these checks had been 
cashed by him inasmuch as we have the charge on his personal bank 
statement. We are unable to determine the disposition of these funds. 

The Chairman. Let us see if we can get this so that we can under- 
stand it. You mentioned the amount of $332,427. 

Mr. FixDLAY. Yes. 

The Chairman. What is that amount? 

Mr. FiNDLAY. That represents items which Allen has cashed or has 
drawn on his personal bank account. 

The Chairman. These are expenses or items on his personal bank 
account for the period from 1949 through 1957 ? 

Mr. FiNDLAY. No, sir. The item of $61,919 that I referred to rep- 
resents items drawn through his personal bank account, for which we 
did not have checks. 

The Chairman. I understand. What is the $332,000 item ? 

Mr. FiNDLAY. It represents items which Allen personally cashed, or 
checks which he drew on his personal account which were missing and 
were considered as cashed. 

The Chairman. What fund does that represent, the $332,000 ? Out 
of what fund is that ? 

Mr. FiNDLAY. Well, the checks of $270,508 which we have copies of 
were obtained from various sources. They were obtained from the 
insurance company in Mount Vernon; they were obtained from his 
joint account with his mother; they were obtained through his per- 
sonal bank account ; and any sources whatsoever where Allen actually 
signed for the cash. 

Mr. Kennedy. This is all the cash that he had available in checks 
to him and checks to cash, during this 9-year period, from various 
sources ? 

Mr. FiNDLAY. From various sources ; yes. 

Mr. KJENNEDY. There will be a second matter that we will get into 
in a moment, Mr. Chairman, in connection with the expenses. 

Mr. FiNDLAY. I can answer your question. Senator, to the extent of 
the amount of checks which we have on hand of $270,508. Shall we 
start with that ? 

He got from the United Public Service Corp. 

Senator Ervin. Before you go into that, I would like to ask one 
question to clarify my mind. What you are stating is that from your 
investigations of the records which you could obtain, during the 
period from 1949 through 1957, through December of 1957, that the 
records indicate that Allen Dorfman secured $332,427 in cash ? 

Mr. FiNDLAY. That is right. 

Senator Ervin. And that there were no records furnished to you by 
him or made available to you by which you could determine what 
Allen Dorfman did with this $332,427? 



16044 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. FiNDLAY. That is right. 

Senator Ervin. I will ask you if your investigation does not in- 
dicate that this was the way the moneys were handled by Allen Dorf- 
man, that they were handled in such a way as to conceal what he 
ultimately did with the $332,427 ? 

Mr. FiNDLAY. That is right. 

Senator Ervin. If a man had been trying to hide what he had done 
with the $332,427, he couldn't have devised a more effective method 
of handling the funds than was pursued by Allen Dorfman to accom- 
plish that purpose, could he? 

Mr. FiNDLAY. That is right, inasmuch as they are all cash. Of 
course, we asked Allen Dorfman and his attorney for an explanation 
of certain of these items, and they said the information would not be 
given to the committee examiner; that it might be given to the 
committee. 

The Chairman. In other words, if I understand it, what you are 
going into this personal account for here is to show the large sums of 
money. We have already shown that there were excessive commis- 
sions and other excessive premiums and so forth paid out of these 
funds for this service and for this protection; you have shown that. 

Mr. FiNDLAY. That is right. 

The Chairman. Now you are showing the large amount of funds 
that passed through Allen Dorfman's hands for which there is no 
accounting ? 

Mr. FiNDLAY. No accounting or no explanation obtainable. 

The Chairman. Apparently no explanation is available to us as 
of this moment. 

Mr. FiNDLAY. That is right. 

The Chairman. That is, to show what had become of what would 
average about $40,000 a year or in excess of $40,000 a year during that 
time ; is that correct ? 

Mr. FiNDLAY. That is right. 

The Chairman. All right. 

Mr. Kennedy. Do we have a memorandum for each one of those 
150 checks? 

Mr. FiNDLAY. For each one of the 138 checks ; yes. 

Mr. Kennedy. Would you furnish a copy to the chairman and 
Senator Ervin so that they can follow ? 

Some of these withdrawals to cash, Mr. Chairman, are of extreme 
significance, and although 

The Chairman. Have you compiled a list of the checks that go to 
make up the $270,508? 

Mr. FiNDLAY. Yes, I have it here. 

The Chairman. You have it there ? 

Mr. FiNDLAY. And I have tlie checks. 

Tlie Chairman. You compiled that list of them, did you ? 

Mr. FiNDLAY. Yes, sir. 

The Chairman. That list may be published in the record at this 
point. 



IMPROPER ACTIVITIES EST THE LABOR FIELD 



16045 



(The list of checks referred to is as follows :) 

Memoeiandum 

Septembeb 16, 1958. 
To : The files. 
From : John P. FIndlay. 

Subject : Allen M. Dorfman — Checks cashed and cash withdrawals together with 
missing items presumably cashed. 
1. As shown by the attached summary and documents, Allen M. Dorfman 
cashed checks or withdrew cash from his joint savings bank account a total of 
$270,508.33, comprising 153 items, by years as follows : 



1955 $9, 289. 45 

1956 21, 17.5. 00 

1957 48, 500. 00 



1949 $6, 403. 59 

1950 47, 942. 66 

1951 63, 471. 01 

19.52 10, 645. 16 

1953 47, 0.33. 19 

1954 16. 048. 27 

2. As shown by the attached summary, checks issued payable to Allen M. 
Dorfman or drawn by him on his personal bank account were missing and pre- 
sumably cashed, totaling $01,919.13, comprising 38 items, by years as follows : 



Total 270, 508. 33 



1949 $1, 000. 00 

1953 6, 500. 00 

1954 22, 410. 63 

1955 3, 500. 00 



1956 $28, 008. 50 

1957 500. 00 



Total 61, 919. 13 



Written requests were made of Stanford Clinton (Allen Dorf man's attorney) 
to produce the above documents during the course of the examination of the 
Dorfman records. 

3. The total of such checks cashed and withdrawals made (par. 1) plus items 
missing and presumably cashed (par. 2) totals $332,427.46, comprising 191 items 
by years as follows : 



Year 


Checks 

cashed or 

withdrawals 


Missing 

checks or 

bank charges 


Together 


1949 


$6, 403. 59 
47, 942. 66 
63,471.01 
10,64,5.16 

47, 033. 19 
16, 048. 27 

9, 289. 45 
21, 175. 00 

48, 500. 00 


$1, 000. 00 


$7 403 59 


1950 


47 942 66 


1951 




03. 471. 01 
10 645 16 


19.52 




1953 


6, 500. 00 
22,410.63 

3, 500. 00 

28, 008. 50 

500.00 


53 533 19 


1954 


38, 458. 90 
12 789 45 


1955 


1956 


49, las 50 


1957 


49, 000. 00 




Total 


270, 508. 33 


61,919.13 


332, 427. 46 





It should be statetl that the above is exclusive of checks cashed by Allen 
Dorfman drawn on his personal bank account between 1949 and December 1953 
which he stated were destroyed. 

4. There is false testimony on the part of Lucille Ferkin, Dorfman's secre- 
tary, at the hearings on November 23, 1953, in the investigation of welfare funds 
and racketeering. On page 90, she denied having ever cashed checks payable 
to Allen Dorfman from Union Casualty Co. or United Public Service Corp. The 



16046 



IMPROPER ACTIVITIES IN THE LABOR FIELD 



attached schedule of checks payable to Allen Dorfman which were cashed show: 
Lucille Ferkin as an endorser on the following 14 checks totaling $9,660.11 : 



Date cashed 


Drawer 


Check No. 


Amount 


Apr. 21,1950 
June 24, H 60 


United Public Service . . ... 


8748 
9060 
9068 
9073 
'6631 
9312 
9316 
9348 
9355 
9307 
9375 
10407 
10408 
11804 


$229. 03 


do 


11. (3 


Do 


do 


27. 2s 


Do - 


. do 


39. ^^ 


Aug. 28, 1950 


Union Casualty Co 


3, 000. UU 


Aug. 30, 1950 


United Public Service . ... 


7.44 


Do 


.... do 


6.61 


Do 


do . . . 


8.25 


Do 


. . do 


53.10 


Do 


do. 


14.49 


Sept. 1, 1950 


do 


20.23 


Apr. 16,1951 
Do 


do. 


3, 738. 16 


do 


2, 500. 00 


Sept. 12, 1951 


. do 


4.01 









Schedules attached. 
JPF/rby 



Allen M. Dorfman 
Chronology of checks cashed and cash icithdraicals 



Date check cashed, withdrawal, 
or bank clearance 


Num- 
ber of 
check 


Amount 


Source of funds 


Refer- 
ence 


m9 

Feb. 9 


6931 
6940 
5337 
5118 
5212 
7896 
7986 
5503 
8117 
5547 
8205 


$202. 82 
25 00 

1, 000 00 
204 16 
387 20 
294 02 
293 00 
700 00 
310 03 

2, 000. 00 
987 36 


United Public Service Corp. 


1 


Feb. 10 


do 


2 


Sept. 20 


Union Casualty Co 


3 


Sept. 21 


do.... 


4 


Do 


do 


5 


Oct. 8- 


United Public Service Corp 


6 


Oct. 22 


do 


7 


Nov. 16 ... 


Union Casualty Co 


8 


Nov. 18 - . 


United Public Service Corp 


9 


Nov. 23 


Union Casualty Co 


10 


Dec. 13. . 


United Public Service Corp 


11 




Union Casualty Co 




1949 total 


6,403 59 






5748 
8347 
5828 
8509 
5914 
8645 
8700 
6079 
8748 
8839 
8937 
8999 
9060 
9068 
9073 
9089 
9103 
6424 
9128 
9158 
9168 
9189 
9191 
9220 
924S 
9259 
6251 
6522 
6538 
6539 
9260 
9269 
9275 




1950 
Jan. 16 


500 00 

623. 16 

2756. 75 

277. 84 

758 00 

177.91 

29.98 

2, 000. 00 

229 03 

100. 00 

1 35 

322 99 

11.63 

27.28 

39.88 

37.16 

26.58 

7, 429. 72 

2.54 

99.43 

28.06 

8.05 

17.53 

12.09 

5. 36 

10.20 

1,875.00 

134.41 

4, 939. 95 

261. 26 

8.48 

3,311.39 

1.218.75 


13 


Jan. 19 


United Public Service Corp.. 


12 


Feb. 10 


Union Casualty Co 


14 


Feb. 16 


United Public Service Corp 


15 


Mar. 6 


Union Casualty Co 


16 


Mar. 16 


United Public Service Corp 


17 


Mar. 31 


....do 


18 


Apr. 5 


Union Casualtv Co 


19 


Apr. 21 . .. . 


United Public Service Corp.. 


20 


Apr. 28 


do 


21 




do 


22 


June 8. 


do 


23 


June 24 


do 


24 




do 


25 




. do.... 


26 


July 6 


Union Casualtv Co 


27 


Do 


United Public Service Corp 

do .- 


28 


Do 


29 


Do 


. do 


30 


July 13 


do 


31 


Do 


do 


32 


Aug. 7 


....do 


33 


Do 


do—. 


34 


Do 


. do 


35 


Do 


do 


36 


Do 


do 


37 


Do 


Union Casualty Co 


38 


Do 


do 


39 


Do 


. do 


40 


Do 


.... do.--. 


41 


Do 


United Public Service Corp 


42 




do 


43 


Do 


do 


44 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16047 

Chronoloffy of checks cashed and cash icithdrawals — Continued 



Date check cashed, withdrawal, 
or bank clearance 



Num- 
ber of 
check 



Amount 



Source of funds 



Au?. 28 . 
Aug. 30. 

Do.. 

Do.. 

Do . 

Do . 
Sept. 1.- 
Sept. 20- 
Sept. 29. 

Do- 
Oct.3... 
Oct. 9... 

Do.. 

Do.. 
Oct. 10.. 
Oct. 18.- 

Do_. 
Oct. 30.. 
Nov. 9.. 
Nov. 14. 
Dec. 7... 
Dec. 14.. 
Dec. 23.. 



1950 



1950 Total. 



Jan. 3... 
Jan. 4... 

Do.. 
Jan. 18.. 

Do.. 

Do.. 
Feb. 15.. 

Do- 
Mar. 2.. 
Mar. 27. 
Apr. 16.. 

Do.. 
Apr. 20.. 
May 3-- 

Do.. 
June 5... 
June 18.. 

Do.. 
July 23.. 

Do.. 
July 24.. 
Aug. 15. 
Sept. 10. 

Do.. 
Sept. 21. 

Do.. 

Do.. 
Nov. 5.. 

Do-. 
Nov. 28. 
Nov. 30. 
Dec. 21.. 

Do.. 



1951 



1951 total. 



Jan. 10.. 
Jan. 11.. 
Jan. 15.. 

Do. 
Feb. 13. 

Do. 



1952 total. 



fifiSl 
9312 
9316 
934S 
9355 
9367 
9375 
9461 
9491 
6737 
9511 
6795 
95.56 
9539 
9539 
9562 
9,582 
9643 
9702 
9695 
9723 
9850 
9853 



7143 

7181 

7182 
10000 
10002 
10023 
10165 
10168 

7440 
10222 
10407 
10408 
10456 
10437 
10441 

7862 
10702 
10716 
10849 
10S50 

8118 
10961 
10971 

8220 
11084 

8366 
11102 

8473 
11215 

8609 
11358 
11380 
11460 



11622 
11578 
8829 
11553 
9020 
1011 



3, 000. 00 

7.44 

6.61 

8.25 

53.10 

14.49 

20.23 

2, 500. 00 

5.40 

880. 20 

71.55 

976. 55 

69.16 



Union Casualty Co 

United Public Service Corp. 

do 

do 

do 

.....do 

do 

.....do. 

do 

Union Ca.sualty Co 

United Public Service Corp. 
Union Casualty Co 



1,514.27 

3, 396. 75 

37.85 

61.74 

3.626.15 

68.41 

4.23 

4, 186. 20 

152. 32 



47, 942. 66 



208. 00 
2,014.15 

827. 56 

189.50 
2, 212. 90 

100.00 
2, 500. 00 
1, 852. 30 

115.00 
1, 968. 50 
3,738. 16 

2, 500. 00 
100. 00 

74.00 

3, 599. 96 
5, 694. 30 

3.66 

4, 638. 81 

2,908. 16 

67.50 

4, 896. 58 

96.57 
4,319.20 
1, 903. 70 
4.01 
2, 764. 10 
2, 823. 28 
2,308.11 
3, 243. 00 
2, 425. 68 

300. 00 
2, ,'^81. 16 

493. 16 



63, 471. 01 



3, 105. 00 
100. 00 
2, 280. 00 
95. 15 
2, 214. 50 
2, 840. 51 

10, 645. 16 



United Public Service Corp. 

do 

do 

do 

do 



.do. 
.do. 
.do. 
.do- 



Union Casualty Co 

do 

do 

United Public Service Corp- 

do ., 

do 

.....do 

do 

Union Ca.sualty Co. ., 

United Public Service Corp.. 

do 

do 

do 

do 

do... 

Union Casualty Co 

United Public Service Corp.. 

....do , 

...-do 

..-.do 

Union Casualty Co 

United Public Service Corp.. 
do- 



Union Casualty Co 

United Public Service Corp. 

Union Casualty Co 

United Public Service Corp- 

Union Casualty Co 

United Public Service Corp. 

Union Casualty Co 

United Public Service Corp. 

-...do 

-..-do. 



....do 

-.-.do 

Union Casualty & Life Insurance Co. 

United Public Service Corp 

Union Casualty & Life Insurance Co. 
United Public Service Corp 



16048 



IMPROPER ACTIVITIES IN THE LABOR FIELD 



Chronology of checks cashed and cash withdratoals — Continued 



Date check cashed, withdrawal, 
or bank clearance 


Num- 
ber of 
check 


Amount 


Source of funds 


Refer- 
ence 


195S 
Apr. 30 


LD205 

5729 
.5730 
6178 
6221 
(') 

6422 
6474 


8, 000. 00 
22, 471. 92 

33'^. 21 

122.00 

3, 104. 06 

500. 00 

10, 000. 00 

2, 000. 00 
500.00 


Allen & Rose Dorfman, joint savings 
account 

Commercial StateBank &TrustCo.— 
Allen M. Dorfman loan account 

Union Insurance Agency of Illinois 

Union Insurance Agency of Illinois 

... .do - 




Mar. 26 


108 


Aug. 6 


107 
108 


Do - 


109 


Oct. 22 


110 


Oct. 23 - 


HI 


Dec. 2 


Allen and Rose Dorfman— joint sav- 
ings. 

Union Insurance Agency of Illinois 

do 


112 


Dec. 4 


113 


Doc. 11 - 


114 




Allen M. Dorfman checking account. - 
Allen and Rose Dorfman — joint sav- 
ings. 
Allen M. Dorfman checking account.. 

Union Insurance Agency of Illinois 

do 




1953 total - 


47, 033. 19 






1343 

(') 

1442 
7045 
7151 
7208 
7308 
7465 
7466 

7524 
7993 




19Si 


400. 00 
10, 000. 00 

500. 00 
500. 00 
500. 00 
500. 00 
500. 00 
548. 27 
300. 00 
848. 27 
300. 00 
2, 000. 00 


115 


Jan. 15 


116 


Mar. 2. 


117 




118 


May 21 


119 


Do 


.... do. 


120 


Do 


do. 


121 


June 18 


do.. 


122 


Do 


.... do 


123 


July 14 - 


do .- 

.... do . 


124 




125 




do 






16. 048. 27 






8478 
8514 
346 
9051 
9138 
3393 




1956 
Jan 13 


489. 45 

1, 000. 00 

5. 000. 00 

300. 00 

500. 00 

2, 000. 00 


126 


Feb. 4 


do. 


127 


Mar. 15 .-. 


Dover Insurance Agency . . 


127a 




Union Insurance Agency of Illinois 

do.. 


128 


June 3.- .. .- . 


129 


Aug. 10 


do... 


130 




Allen Dorfman checking account 

do.. 

Windsor Investment Co 




1955 total 


9, 289. 45 






510 
2)02 

132 
2154 
(2) 
(=) 

235 

590 
(3) 




1958 
Mar. 26 


$15, 000. 00 

150. 00 

125. 00 

300. 00 

2, 000. 00 

100. 00 

500. 00 

1,000.00 

2, 000. 00 


131 


Apr. 12 


132 






July 17 


Allen Dorfman checking account 

Union Ins'irance Acency of Illinois... 

Allen Dorfman checking account 

Amalg.amated Insurance Agency 

do 


133 


Aug. 16 


134 


Aug. 19 


135 


Aug. 20 


135a 


Oct. 29 


135b 


Nov. 2 


Union Insurance Agency of Illinois 

Allen M. Dorfman checking account. . 
Amalgamated Insurance Agency Serv- 
ice. 

Union Insurance .\gency of Illinois 

-Vllcn M. Dorfman checking account.. 

Union Insurance Agency of Illinois 

Dover Insurance .\goncy, Inc.. 


136 






1956 total 


21,175.00 






2371 
1059 

11516 
(') 

11558 
1121 
1453 

1454 
(') 

1081 

1149 
11669 
11806 




1957 
Feb. 5 


10. 000. 00 
1,000.00 

1,000.00 
14, 000. 00 
2, 000. 00 
2, COO. 00 
2, 000. 00 

3, 000. 00 
7, 000. 00 

2, 500. 00 

2, 500. 00 

1, 000. 00 

600. 00 


137 


Feb. 8— 


138 


Mar. 20 


139 


Apr. 22 


139a 




140 
141 




Amalgamated Insurance Agency Serv- 
ice. 
do 


142 
143 


July 24 


Allen and Rose Dorfman joint savings 
account. 

Amalgamated Insurance Agency Serv- 
ice. 

Dover Insurance Agency, Inc. . 


144 
145 




146 


Sept. 25 


Union Insurance Agency of Illinois 

do 


147 




148 








1957 total 


48, 500. 00 











1 withdrawal slip. 
' Travelers check. 
' Counter chock. 
* No number. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16049 

Checks missing and presumahly cashed 



Drawer 


Payee 


Date of check 
or bank charge 


Check 
No. 


Amount 


1949 
Union Casualty Co . . 


Alien Dorfman 


Aug. 1949 


5266 


$1 000 00 






1949 total 


1 030 00 


196S 

Union Insurance Agency of Illinois 

Do 


Alien Dorfman 

do 


June 22,1953 
Aug. 13,1953 
Dec. 11,1953 


5554 
5SJ0 
0) 


300.00 

5 230 00 




(•) . . 


1 n.irt no 








1953 total - 


6, 530. 00 

500. 00 
4, 943. 63 
533. 00 
530 00 
530 00 
530 00 
5. 030 00 
270 00 
230 00 
530 00 
500 00 


195A 
Union Insurance Agency of Illinois. 


Allen Dorfman 

(1) . . 


Feb. 3, 1954 
Feb. 5, 1954 
Feb. 24.1954 
Mar. 26, 1954 
do 


6719 

(') 
6741 
6871 
6919 
7001 
7012 

(') 

(') 

(') 
7360 
7459 
7507 
7559 
7652 

(') 
7707 
7795 
7842 
7936 
7977 
8078 
8I3S 
8231 
8277 
836G 
8417 


Union Insurance Agency of Illinois.. 

Do 


Allen Dorfman 

.... do 


Do - 


... do 


Do 


... do 


do 


Do 


do.- 


Apr. 2. 1951 
.\pr. 14,1954 
Apr. 19,1954 
May 10 1954 
June 4, 1951 
June 21,1954 
Julv 2, 1954 
July 16.1954 
Julv 30,1954 
Aue. 11.1954 
Aug. 13,1954 
Aus. 27,1954 
Sept. 10. 1954 
Sept. 24, 1954 
Oct. 8 1954 
Oct. 22,1954 
Nov. 5,1954 
Nov. 19, 1954 
Dec. 3, 1954 
Dec. 17,1954 
Dec. 31,1954 


Allen Dorfman .. 


(1) 


Do -. 


(1) 


Do 


(1) . . 


Union Insurance Agency of Illinois 

Do - - 


Allen Dorfman 

do 


Do 


. .. do 


530 00 


Do 


.... do 


Do 


do 


500 00 

1,030 00 

500. 00 

500, 00 




(1) 


Union Insurance Agency of Iliinois 

Do . 


.\llen Dorfman 

do 


Do --- 


do 


Do - 


do.. 


500 00 


Do 


.. . do 


500 00 


Do - 


do.- 


.500 00 


Do 


do. 


500 00 


Do 


do 


500 00 


Do. - 


^.-..do 


500 00 


Do.. - - -.- 

Do - 


do - 

do 


500.00 
500 00 








1954 total 


22, 410. 63 




.^llen Dorfman 

do. 


Jan. 14,1955 
Mar. 22, 1955 
Nov. 1, 1955 


145 
8780 
9777 


1955 

Union Insurance Agency of Illinois 

Do 


1,000.00 
500 00 


Do 


do 


2,000.00 






1955 total 


3, 500. 00 




(1) 


Apr. 18,1956 
May 2, 1956 
June 20,1956 


(') 
(•) 
(') 


1956 
Allen Dorfman 


15,000.00 
4, 000. 00 
9, 008. 50 


Do 


(1) 


Do.... 


(1) 






1956 total . -- 


28, 008. 50 




(i)„ 


Apr. 24,1957 


(') 


1957 


500 00 










500 00 











• Allen Dorfman states he does not have check stubs, therefore it was not possible to determine check 
number or payee. 

The Chairman. Now, if you will, let us have a copy of it and we 
will follow you as you make explanations about it. 

Mr. FiNDLAY. I should first like to give you the analysis by yeai-s, 
if you would like to have that. 

The Chairman. Very well. 

Starting by the years, give us the amount that is covered by this 
list, begmning with 1949. Wliat is the amount ? 



16050 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr FiNDLAT. That list is $270,508, and I have already testified 
that there are checks missing from Allen Dorfman s personal accounts 
for $61,000, which comprises the $332,000 that we have to account for. 

The Chairman. That makes $332,427. 

Mr. FiNDLAY. Yes. -r •. i t.^^ 

The Chairman. But you list here, as I see it, where you show 

Mr. FiNDLAY. In 1949, the first year, there was $7,404. 
The Chairman. That includes $1,000 that you have no check for? 
Mr. FiNDLAY. It is missing, and which is included m with the 
$61,000. 

The Chairman. All right. 

Mr. FiNDLAY. In 1950, there is $47,943. 

The Chairman. That was 1950. All right. 

Mr. FiNDLAY. In 1951, $63,471. 

The Chairman. All right. .^.^ ^^o roo 

Mr. FiNDLAY. In 1952, it is $10,645 ; in 1953, $53,533. ^ , ^ , 

The Chairman. Plus how much that you had no checks tor ^ 

Mr FiNDLAY. Well, this is checks and no-checks combined. 

The Chairman. You show 1953 down here that you couldn t hnd 

checks for $6,500. ^ , , i o ^ ^i. 

Mr. FiNDLAY. At the back of that schedule, Senator, there is a 

listing of checks missing. 

The Chairman. Very well. Go ahead. 

Mr. FiNDLAY. In 1954, there is $38,459. 

The Chairman. $38,000 what? 

Mr. FiNDLAY. $38,459. ,^..^.on>7 • ^-u ^ 

The Chapman. That includes $22,410, and $16,048.27; is that 

corrBct 

Mr. FiNDLAY. That is right. That is a bank loan which he cashed. 
The Chairman. Why are the two separate? You listed $16,048. 

Verv well. Proceed. ^ „ . ^„ n • 

Mr. FiNDLAY. In 1955, there is $12,789; in 1956, $49,183; and in 

1957, $49,000. ^ r^^ It 

That total is $332,427, which he has to account for. The source of 
this $332,427 was the following: He got from theUnited Public Serv- 
ice Corp. $78,390; he got from Union Casualty Co., $45,568; lie drew 
from the Allen and Rose Dorfman joint savings account $35,000; he 
<rot a bank loan from the Commercial State Bank for $22,471 ; he got 
?ash from his own agency, the Union Insurance Agency of Illmois, 
$40 450; and from other Porfman entities he received ^24,loU. 

That represents $270,508 worth of checks from various sources for 
which we have either the original or photostats of the checks shown 
on the summary which you are looking at. . , , , • • j? 

Then at the back of the summary we have listed checks missing from 
Allen Dorfman's personal checking account or other sources o± Sj>bl,Jiy, 
totaling the $332,427 which we attempted to account for 

Mr. Kennedy. Could you give us two or three examples to show the 
large withdrawals of cash ? 

Mr. FiNDLAY. Yes. , ^ • j i 

Mr Kennedy. Then, Mr. Chairman, as the hearings develop, per- 
haps not todav or tomorrow, but subsequently, these dates will be 
shown to be of particular significance, by actions of certain other 
individuals. 



IIVIPROPER ACTIVITIES IN THE LABOR FIELD 16051 

Mr. FiNDL^VY. I have mentioned that there was a drawing from the 
Allen Dorfman and Rose Dorfman, his mother, Allen and Rose joint 
savings account, the account with his mother, of $35,000. 

In April of 1953 he withdrew $8,000; on December 2, 1953, he with- 
drew $10,000; on Januarv 15, 1954, he withdrew $10,000; and on April 
22, 1957, he withdrew $7,000. ^ 

We asked Allen Dorfman for an explanation of the disposition of 
these funds, and as I say, he refused to give us any explanation whatso- 
ever on the withdrawals from the joint savings account. 

Mr. Kennedy. For instance, on April 22, 1957, how much money 
did he withdraw and have available for himself in cash? 

Mr. FiNDLAY. He withdrew $7,000 on April 22 from the joint sav- 
ings account. 

Mr. Kennedy. I am talking about completely. How much money 
did he withdraw on that day ? 

Mr. FiNDLAY. He withdrew $30,000 on that day. 

Mr. Kennedy. On April 22? 

Mr. FiNDLAY. On April 22. 

The Chairman. Was that withdrawn in cash ? 

Mr. FiNDLAY. It comprised about five items. Shall I give you the 
details ? 

The Chairman. No. Did he withdraw it in cash? Were these 
withdrawals in cash ? 

Mr. FiNDLAY. Yes. They are all in cash. 

The Chairman. In other words, he got $30,000 that day in cash ? 

Mr. FiNDLAY. In cash. 

The Chairman. And he got it from six different sources; is that 
correct ? 

Mr. FiNDLAY. Yes. I have to refer to the particular item. 

The Chairman. I am going by this list that you have supplied the 
members. 

Mr. FiNDLAY. Yes. There are six different items. 

The Chairman. The largest one being for $14,000. 

Mr. FiNDLAY. The $14,000 item ; yes. 

The Chairman. And then there were three for $2,000 each « 

Mr. FiNDLAY. Three for $2,000, one for $3,000, and one for $7,000. 

The Chairman. That makes the $30,000 that he withdrew that day 
m cash from those sources ? 

Mr. FiNDL/\Y. Yes. 

The Chairman. All right. 

Mr. Kennedy. That elate is going to be of some significance. That 
isApril22,1957. 

Senator Mundt. Does the record show whether he withdrew that 
money from the banks or did he take it out of the cash account of one 
of the insurance companies, or where did the monev actually come 
from ? 

_ Mr. FINDL.VY. Well, the first item of $7,000 he withdrew from the 
joint savings account of Allen and Rose Dorfman. 

Senator Mundt. Did you find out whether that was withdrawn in 
big bills or small bills, or how it was withdrawn? 

Mr. FiNDLAY. Well, this is the Exchange National Bank, and I do 
not think it would have cooperated to that extent, and in fact, we had 
difficulty in recording the different items. 



16052 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Senator Mundt. $7,000 even in hundred dollar bills is a pretty good 
sized load of alfalfa hay, and if lower than that it is a pretty big 
bundle of currency. I wonder if he took it out in $1,000 bills, or $500 
bills or bills of the denomination of which banks customarily keep a 
record when they hand out superduper bills. 

Mr. FiNDLAY. We could not obtain any information on that score. 
On the same day he drew a check for $14,000 on his personal bank 
account and endorsed the check at the bank and received the money, 
and that check being of such a size I asked Allen about it and he refused 
to give me information. But the following day his attorney advised 
me that Allen had said the money had gone into their safe deposit 
box in the Exchange National Bank. 

Senator Ervin. To simplify this thing so that a man used to thinking 
in small figures can readily understand it, from the records which you 
were able to obtain during a period of 9 years, beginning in 1949 and 
ending in 1957, Allen Dorfman got $332,427 in cash for which you 
have been unable to obtain any record to show what he did with it 
and which he has refused to tell you what he did with it? 

Mr. FiNDLAY. That is right. 

Senator Ervin. Wlien you average that over a year, breaking it 
down, averaging it over the years, that was equivalent to an average 
of $36,936 a year. 

Mr. FiNDLAY. Yes, sir. 

Senator Ervin. If my arithmetic be correct ? 

Mr. FiNDLAY. Yes, sir. 

Senator Er\in. And breaking it down a little further, it was 
slightly over $100 a day, counting Sundays and holidays each of those 
9 years ? 

Mr. FiNDLAY. That is correct. 

There is one additional thing on this. Allen Dorfman stated that 
his bank statements prior to December of 1953 had been destroyed, 
so that we were unable to trace any items of a cash nature between the 
period of 1949 and 1953, so this $332,000 is a minimum figure. His 
personal bank records were said to have been destroyed prior to 
December of 1953. 

Senator Ervin. And he told you with respect to some of his other 
bank records, he did not keep check stubs, and he made no entries 
on check stubs ? 

Mr. FiNDLAY. He told us he kept no check stubs on any personal 
bank accounts, and therefore we were unable to determine in connec- 
tion with the missing items who the payee was. We had no way of 
determining to whom the check was drawm, and since the check was 
missing it naturally was assumed to have been a cash item or an item 
of that kind. 

Senator Ervin. In other words, he kept no check stubs, and then 
when the check was cashed or whoever got it, then ho destroyed the 
check ? 

Mr. FiNDLAY. The check had been withdrawn from the bank state- 
ment that was turned over to us, and we were able to determine by the 
charges on the bank statement there was some missing items, and 
those items were of sizable amounts and have been listed on the 
schedule which Senator McClollan has. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16053 

Senator Ekvin. And he said ho would not disclose to you any in- 
formation as to what lie had done with any of this money ? 

JSIr. FiNDLAY. That is correct. 

As an example of one of the sizable items for which the check was 
missing, on April 18, 1956, there was a charge for $15,000 for wliich 
the check or voucher had been withdrawn. 

Mr. Kennehy. Now, again, in 1957, we have on July 24, 1957, 
$5,000 withdrawn in casli ; and on February 5, 1957, $10,000 in cash. 

Mr, FiNDL^vY. That is right. 

Mr. Kexxedy. Now, this is all in addition to his regular living ex- 
penses which he had and which, of course, are not included in this 
list, where we could trace the money and we have not included it ? 

Mr. FiNDLAY. It is in addition to items which passed through his 
personal bank account, for which we knew what the items were for. 
In other words, he put through his personal bank accounts some 
sizable amounts, and, of course, a good many of his household expenses 
and investments and things of that type go through his personal bank 
account. Payments for items such as his Federal income tax return 
are made through his insurance entities, and the Union Insurance 
Agency of Illinois or the Amalgamated Insurance & Service Co., 
so that we know that he did not use any of this money in connection 
with payments of that type. 

Mr. Kennedy. Let me give you some further examples, and you 
gave the one on April 15, 1956, of $15,000, but then on March 26, 
1956, there was another $15,000 ; is that not correct? 

Mr. FiNDLAY. That is right. 

Mr. Kennedy. And on January 15, 1954, 1 do not know whether we 
have mentioned this, but $10,000 was withdrawn on that day ? 

Mr. FiNDLAY. Yes, sir. 

Mr. Kennedy. In cash? 

Mr. FiNDLAY. Yes, and I have the 138 checks here, Mr. Kennedy,. 
if you wish to have them. 

The Chairman. Are those the originals or photostatic copies? 

Mr. FiNDLAY. In the case of checks issued by the United Public 
Service Corp. in the early years, w^e were able to obtain the original 
copies. In connection wutli the disbursements in the latter years, 
items which were cashed by Allen in which he obtained the monies 
from certain of his insurance entities, we have photostats. 

The Chairman. The Chair will order that photostatic copies of all 
of the checks which the witness has in this package be made exhibit 
227 in bulk, a total of 138 checks I believe the witness testified to. Is 
that correct ? 

Mr. FiNDLAY. I said 138, but there are 153 checks here. 

The Chairman. All right, there are 153 checks. This package of 
checks, being 153 separate checks, may be made exhibit 227, and 
wherever there are original cliecks Ave will substitute for them photo- 
static copies and they will be made an exhibit in bulk. 

(A group of 153 checks was marked "Exhibit No. 277,"' for ref- 
erence and may be found in tlie files of the select committee.) 

Mr. Kennedy. Could we make as an exhibit this memorandum that 
summarizes the checks. 

The Chairman. I believe I ordered that memoi-andum placed in 
the record and it has already l)eeii printed in the record. 
36751— 50— pr. 4:: s 



16054 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Senator Mundt. I was interested in the statement that you made 
that the personal income tax payments of Mr. Dorfman were made by 
checks drawn on a couple of insurance companies; is that right? 

Mr. FiNDLAY. Yes ; his Union Insurance Agency of Illinois, which 
is a partnership with his mother, and the Amalgamated Insurance 
Agency Services, Ltd., which is a corporation owned by himself and 
his mother. 

Senator Mundt. He and his mother are the sole owners? 

Mr. FiNDLAY. They are the sole owners. Now, the payments which 
are made on behalf of his Federal income tax returns are charged 
to his drawing account in the partnership, and to him personally in 
the case of the corporation. 

Senator Mundt. I couldn't understand how you could make pay- 
ments from an insurance company, but if he was the sole owner or the 
family was, that is understandable. 

Mr. Kennedy. Now, I want to go with you into another matter 
dealing with this, and that was his withdrawals of large sums of 
money from his various entities which are charged to travel expenses. 

How much did he charge in travel expenses and entertainment? 

Mr. FiNDLAY. May I get the file, Mr. Kennedy? I do not have 
it handy here. 

Mr. Kennedy. All right. Will you tell us what it shows as far 
as Mr. Allen Dorfman's charges to travel and entertainment and pro- 
motional expenses were ? 

Mr. FiNDLAY. A total of over $340,000 has been charged on the 
books and tax returns as travel, entertainment, promotion and sales 
expenses for a 4%-year period, from May 1, 1953 to December 31, 1957. 

On May 1, 1953, it was the first year for which the books of the 
Dorfman insurance intities were available. The books prior to May 
1, 1953, as I have mentioned, were said to have been destroyed. The 
records were not completely posted through December 31, 1957, the 
date of the termination of our review, so that again this figure of 
$340,159 is a minimum figure. 

From the Union Insurance Agency of Illinois, which is the partner- 
ship of Allen and Rose, he obtained the bulk of the moneys. He re- 
ceived $238,371 from that agency. He received from the Amalgam- 
ated Insurance Agency Services, $70,342. He received from the 
Dover Insurance Agency, Ltd., $7,268, and from the Windsor Invest- 
ment Co., which is also a Dorfman entity, $125, and Allen Dorfman 
claimed in his personal tax return for 1954 $24,053 of unreimbureed 
travel expenses on behalf of the Union Insurance Agency of Illinois. 
The total of those items is $340,159. 

Mr. Kknnedy. Now, out of the $340,000, how much do we find 
were checks directly to either airlines or a liotel or that we can trace 
direct! V? 

Mr. FiNDLAY. Out of the $340,159, there is $158,802 representing 
payments to hotels such as the Saxony, restaurants, airlines, clubs, 
liquor shops, and floral shops. In other words, they are items and 
direct payments considered in the nature of operating expenses of 
the insurance business for wliich he was takinir them as tax deductions. 

Mr. Kennedy. So that is $158,000 out of the $340,000 ? 

Mr. FiNDLAY. Yes. 

Mr. Kennedy. What happened to the rest ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16055 

Mr. FiNDLAY. The baLance is $181,698— $140,760 Allen got in checks 
which he either cashed or deposited in his personal bank account. 
This $140,000 represents periodic withdrawals of $1,500, $2,000, and, 
in some cases, items to the extent of $11,500, in the case of one check, 
as high as $11,500. 

That represents actual checks drawn to the order of Allen and 
charged to the travel and entertainment expense of the company. 

The difference of $41,000 represents the $24,000 which I mentioned 
he claimed in his 1954 tax return. Another means of obtaining credit 
for travel was to have the auditors prepare an analysis of his expenses 
based on some information furnished to him, and his drawing account 
was credited for $16,885. 

Mr. Kennedy. Mr. Findlay, the important matter here is the 
amount of money for which there is no substantiation. What do 
the records show about that ? 

Mr. Findlay, Well, they show 

Mr. Kennedy. We have found out of the $340,000 there was $182,000 
which was paid directly to Allen or credited to him; is that right? 

Mr. Findlay, Yes, 

Mr, Kennedy, That is the figure we are interested in. Out of that 
$182,000 

Mr, Findlay. Allen Dorfman submitted to the committee expense 
vouchers totaling $77,488. 

Mr. Kennedy. Let's call it $78,000, 

Mr. Findlay. $78,000 ; right. 

Mr. Kennedy. So there was $182,000 which went to Allen Dorfman 
directly or was credited to him. We asked Allen Dorfman for the 
vouchers to support that. Pie gave us some vouchers for some $78,000 
of that: is that right? 

Mr. FINDL.VY. That is right, 

Mr, Kennedy. What kind of vouchers did that consist of ? 

Mr. Findlay. Well, the vouchers were rather sketchy. They were 
what I would call totally unsupported vouchers. In most cases the 
descriptions were vague. 

Mr. Kennedy. Give us two or three examples. 

Mr. FiNDLiVY. Well, in a period in 1956, for the period October 30 
to November 2, he charged $2,815, and the voucher read "25 prospec- 
tive clients to Las Vegas." There were no names furnished. 

On January 15 to February 5, 1955, he charged $2,770, He said, 
"Teamsters meeting and AFL, Miami, Fla," There is no mention 
of the individuals. 

In September of 1955 he put in a voucher for $1,800 and just said 
"Miami-Havana," 

In January of 1956, he put in a voucher for $2,216, marking it 
"Dallas and Houston, southern conference meeting," 

In the month of February 1956, there is a $2,344 item which says, 
"Periodic trips to Miami, promotion." 

In March of 1956 he has "St. Thomas, Miami, San Juan, and New 
York," 

Mr, Kennedy, But no vouchers supporting it whatsoever? 

Mr. Findlay. No vouchers. 

Mr. Kennedy. No bills of any kind ? 

Mr, Findlay. No bills because actually the bulk of this money is 
marked "Entertainment." 



16056 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. So those kinds of vouchers were submitted for 
$78,000 of the $182,000. Did he give you any vouchers for the 
$104,000? Any vouchers at all ? Even of this kind of voucher? 

Mr. FiNDLAY. He gave us none, but we explained to him that we 
didn't have vouchers covering the total charges that had been made to 
the travel accounts on his behalf, and the explanation was "You've 
got what was submitted." 

Mr. I^NNEDY. He has $182,000 credited to him, or checks that were 
made out to him ; and out of that $182,000 he furnished these kinds of 
statements for some $78,000 of it, and no statements of any kind for 
$104,000; is that right? 

Mr. FiNDLAY. That is ri^ht. 

Mr. Kennedy. Ordinarily in an expense account of this kind, 
doesn't the the ordinary citizen have to be able to support the expenses 
that he had, in order to be able to deduct them in his income tax ? 

Mr. FiNDLAY. I would think so. But a review in the prior years by 
the Internal Revenue Service apparently was predicated on allowing 
him a percentage of the commissions which he had received. Inas- 
much as the commissions were excessive, naturally the allowance for 
travel would be excessive. 

Mr. Kennedy. You say the the Internal Revenue Service made a 
review of his records ? 

Mr. FiNDLAY. They made a review through the year 1952, and there 
was a very minor adjustment. His returns for subsequent years are 
now under investigation. 

(At this point, Senator Mundt left the hearing room.) 

Mr. Kennedy. Hadn't the agent who was in charge of the internal 
revenue review of Mr. Dorfman's books been dismissed from the In- 
ternal Revenue Service ? 

Mr. FiNDLAY. That is true. 

Mr, Kennedy. And wasn't he dismissed for his relationship that 
existed between him and certain individuals who he was supposed to 
be investigating? 

Mr. FiNDLAY. Yes. 

Mr. Kennedy. And that is the internal revenue agent that made the 
review of Mr. Dorfman's records for the period up to 1952 ; is that 
correct ? 

Mr. FiNDLAY. That is right. 

Mr. Kennedy. That review was started after the investigation that 
occurred by the Hoffman committee ? 

Mr. FiNDLAY. I believe that is so. 

Mr. Kennedy. And instead of making a further study of some of 
the matters that were uncovered there, there was very little done on 
the case, and Mr. Dorfman paid some minor back taxes and tlie case 
was closed. 

Subsequently, within the last 6 or 8 months, the Internal Revenue 
Service agent has been investigated by the Intei-nal Revenue Service 
and has been removed from office, and the case on Mi-. Allen Dorfman 
has been reopened ; is that correct ? 

Mr. FiNDLAY. That is so. 

Miller, Mandell & Co., the certified public accountants who audit tiie 
books of Allen Dorfman, they make the audit but do not furnish an 
affirmative opinion. In other words, they submit an opinion which is 



IMPROPER ACTrV'ITIES IN THE LABOR FIELD 16057 

considered a disclaimer of opinion. They state that the audit is made 
primarily for management purposes, and that they are not in a position 
to state tlie books and records present fairly the position of his com- 
panies at that date. 

However, based on the examination of the accounts, they also pre- 
pare his Federal tax returns. In connection with the items claimed as 
travel and entertainment on the returns, Miller, Mandell & Co. make 
an analysis of the travel and entertainment expenses. 

In a good many cases, sizable items which appear in the travel ex- 
pense analysis are marked by Miller-Mandell "No detail," or in some 
cases they are marked "Texas expense reimbursement, no detail." 

The Chairman. Marked what? 

Mr. FiNDLAT. "No detail." 

The Chairman. You said something about reimbursement. 

Mr. Findlay. In one item, in 1955, 1 am using this as an illustration, 
a disbursement on behalf of Allen in connexjtion with a Texas expense 
reimbursement, they just marked "No detail." 

In other sizable items where the check was drawn to Allen and they 
asked for an explanation, he gives them some explanation, but it does 
not appear in their working papers. It generally says, "Per Allen 
Dorfman." So it is evident that they did not have any vouchers cover- 
ing these items as well. 

Mr. Kennedy. There are four or live more items I would like to get 
into this afternoon. 

Do we have one specific instance where a deduction was taken by 
Mr. Dorfman that appears at the very least to be unjustified? I am 
talking about the $8,000 deduction that was taken in his personal tax 
returns in connection with the transaction with David Probstein, about 
whom, Mr. Chairman, we have had some testimony in earlier hearings. 

Do you have that ? 

Mr. Findlay. Yes, sir. 

Mr. Kennedy. Mr. David Probstein is the individual who headed 
the State Cab Co. in Indianapolis, Ind., and is the one who has dis- 
appeared. 

Mr. Findlay. Allen Dorfman in his 1955 income-tax return claimed 
as a deduction an advance to David Probstein for acquisition of tax 
liens. 

The Chairman. For what? 

Mr. Findlay. For acquisition of tax liens, $11,500. From that he 
has deducted amounts received from redemption of the loans of $3,309 ; 
he is claiming a loss of $8,190.36 with respect to the Probstein deal. 

Mr. Kennedy. He claimed that as a bad debt ; is that right ? 

Mr. Findlay. He did. 

Mr. Kennedy. All right. 

Mr. Findlay. In August, on August 12, 1954, Allen Dorfman drew 
a check to David Probstein for $11,500 which he forwarded to Prob- 
stein and which was deposited in an account in Indianapolis. This 
$11,500 that Allen forwarded Probstein was obtained from the Union 
Insurance Agency of Illinois on the same day. 

He received a check for $11,500. That' is one of the items which 
was charged to travel and entertainment, although originally it was 
booked in the suspense account, indicating that the item was unusual. 
But subsequently it was journalized out by Miller-Mandell, who m.ake 
a periodic review of the accounts, and charged to the Dorfman account. 



16058 IMPROPER ACTIVITIES IN THE LABOR FIELD 

With respect to that $11,500 item, I also asked where the vouchers 
were for that, and was told that I had received them along with the 
others. However, when I called the attention of the accountant, Na- 
than Miller, of Miller-Mandell, to the fact that this $11,500 appar- 
ently was the same item which was sent to David Probstein, inasmuch 
as he had claimed it as a deduction in his personal income-tax return, 
and the item was also being claimed as an expense item on the books 
of his partnership, it was a duplication, he said, "It appears so." 

The Chairman. As I understand it, on the books of the company 
where he got the money to loan to Probstein, they charged it as an 
expense to that company, a travel expense, and so forth ; is that correct? 

Mr. FiNDLAY. Yes. I have the check here. 

The Chairman. They charged it originally as travel expense ? 

Mr. FiNDLAY. They charged it originallv as suspense and then 
transferred it to "Travel expense." 

The Chairman. All right. But so far as the permanent records of 
that company, it is travel expense ? 

Mr. FiNDLAY. Yes, sir. 

The Chairman. And it has been deducted for income tax pur- 
poses there ? 

Mr. FiNDLAY. Yes, sir. It is included in the figures taken as a 
deduction. 

The Chairman. Taken as a deduction in that instance. Then since 
Probstein didn't pay it back, it is again taken as a loss by him per- 
sonally ? 

Mr. FiNDLAY. It is claimed as an embezzlement loss in his return. 

The Chairman. In his return he claimed it as embezzlement ? 

Mr. FiNDLAY. Yes. 

Mr. Kennedy. Bad debt, I thought. 

Mr. FiNDLAY. Well, it is marked "Embezzlement loss." 

The Chairman. I wonder how you compare that with this $51,000 
that he had out to one side this morning? Was anything said in 
connection with that about embezzlement? 

Mr. FiNDLAY. It wasn't discussed with him. 

The Chairman. That wasn't on his record, but this item is an 
embezzlement account ; is that correct ? 

Mr. FiNDLAY. Yes. 

Mr. Kennedy. As another expense matter, Mr. Uhlmann, did Mr. 
Allen Dorfman have a number of his relatives on the payroll? 

TESTIMONY OF MARTIN S. UHLMANN— Resumed 

Mr. Uhlmann. Yes, sir ; he did. 

Mr. Kennedy. Could you tell us what that shows, briefly ? Briefly 
summarize the situation. 

Mr. Uhlmann. Well, Mr. Dorfman carried on his payroll, apart 
from his mother, of course, w^ho he is associated with, three aunts, a 
brotlier, an uncle, among others. 

Mr. Kennedy. There was Rose Ritman, who is now deceased; is 
that correct ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. What is her relation to Allen Dorfman ? 

Mr. Uhlmann. An aunt. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16059 

Mr. Kennedy. Was that her real name, Kitman ? 

Mr. Uhlmann. That was her married name. 

Mr. Kennedy. Then he had Lynne Williams; is that right? 

Mr. Uhlmann. Well, Lynne Williams was the maiden name of 
Allen Dorfman's wife when she was employed by his agency in 1950, 

Mr. Kennedy. She was on the payroll in her maiden name ; is that 
right? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. Then Gertrude Prosterman ? 

Mr. Uhlmann. That is one of Allen Dorfman's aunts and a sister 
of Rose Dor f man. 

Mr. Kennedy. And William Dorf man ? 

Mr. Uhlmann. He is the husband of Fay Dorfman. Fay Dorf- 
man is on the payroll of Allen Dorfman's insurance agency and Wil- 
liam Dorfman manages the camps, the two camps, which are located 
in Wisconsin. 

Mr. Kennedy. So William Dorfman did not work directly for the 
insurance agency? 

Mr. Uhlmann. He did at one time ; yes, sir. 

Mr. Kennedy. Harry Hitman is the deceased husband of Rose 
Ritman ; is that right ? 

Mr. Uhlmann. I am not quite certain about the relationship of 
Harry Ritman and Rose Ritman, but Harry Ritman, I know, was the 
father of Rose Ritman. I beg your pardon — of Rose Dorfman. 

Mr. Kennedy. Was he on the payroll ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. And Rose Dorfman, of course. 

Mr. Uhlmann. Yes. 

Mr. Kennedy. And then Paul Dorfman ? 

Mr. Uhlmann. Paul Dorfman was not, shall we say, technically on 
the payroll, but from time to time he has received money from the 
insurance company. 

Mr. Kennedy. And then Fay Dorfman we mentioned, who is a 
switchboard operator, and Jay Dorfman, Allen's brother, was he on 
the payroll a while ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. So that is nine relatives that were on the payroll 
at various times, of Allen Dorfman ? 

ISIr. Uhlmann. Yes. 

Mr. Kennedy. What is the significance of that? These were his 
own companies. What is the significance of that as far as we are 
concerned ? 

Mr. Uhlmann. Well, it is well recognized that nepotism some- 
times 

Mr. Kennedy. I am talking about as far as the cost is concerned. 

Mr. Uhlmann. Insofar as the cost is concerned, I am not in a posi- 
tion to tell whether other people would have been required in their 
place. 

Mr. KJENNEDY. Do you know what the charges were to these various 
people ? 

Mr. Uhlmann. I do not have the aggregate sum of money ; no, sir. 

Mr. Kennedy. Do you also have, in addition to this situation, the 
management representatives and various attorneys who were involved 



16060 IMPROPER ACTIVITIES IN THE LABOR FIELD 

in this situation that were on both sides as far as this insurance was 
i™ed re^^^^^^^^^ both the Dorfmans and, in some instances, 

represented the unions? 
Mr. Uhlmann. Yes, sir. 

Mr Kennedy Would you give us what the situation IS? 

Mr: Uhlmann Well, we^have one situation which relates to a 

™r^^E™?:You have the list there. Would you just go down 

*^Mr Uhlmann. Mr. Goodman is an attorney in Chicago, and he is 
on retainer with Northeastern Life Insurance Co. of ^ew York at 
Mount Vernon and also retained by Allen Dorfman, or one of his 

"''m^'' Kennedy. So he is being retained by the insurance company 

^in'iLMfNN.^ It^'Sf course, he had a part interest in one of the 

""Tr'K^^^Z^lnd at a time also did he not.also represent the 

wfs[e Trade Industry of Chicago, which was doing the bargammg 

with the union that formerly belonged to Paul Dorfnian^ Cxoodman in 

Mr. Uhlmann. I have no information about Phil (joodman m 

*^Mr. Kennedy. Then we will have information on that tomorrow. 

Mr.Kunis? ^ . . ^ i.i. ^„ 

Mr. Uhlmann. Well, Mr. Kunis is not an attorney. 

Mr Kennedy I am talking about anyone. 

Mr Uhlmann. i beg your pardon. Yes, Mr. Kunis at one time was 
actuary for the U.S. life Insurance Co. which, as was developed here 
yesSy, carried the life portion of the insurance coverage for both 
[he Cent'^al States and the Michigan ^«ff^^'--%Pf,;^i^//?);7;i:^ 
other welfare groups that were insured through both Mr. Doitman 

"taVef Mr.Tunis left U.S. Life to come with Dr. Perlman's U.S. 
CasualtvCo. as chief actuary and vice president. 
"^ IS a little over a year'ago he resigned from tl-se^position^^^ 
he since has been retained as an actuarial '^^^'^\^''\^y ^^I^^^^^^^^^ 
Life Insurance Co., and he is also a consultant for the Republic JNa- 
t^onalMe Insurance Co., which is the reinsurer for Northeastern 
L?fe and he is consultant for the Central States pension fund, as well 
as f<;;Toint Councils 43, 69, the Western Conference of Teamsters, 
Local 813, Local 449, among others in the Teamster group. 

Mr. Ke'nnedy. So he ser^^es the insurance companies, he serves the 
broker, and he also serves the Teamsters Union which purchases the 

'"^Mr? Uhlmann. Yes. Last summer Mr. Kunis was instrumental in 
having a life-insurance company formed, and his '^f ^^la es in that 
undertaking are people who are in other respects closely affiliated with 
the Dorfmans in other enterprises. 

Mr. Kennedy. How about Llerbert Lissner? . ^i . ^/i ;= « 

Mr. Uhlmann. Mr. Lissner is an attorney m Chicago, and is a 

stockholder in several of the Dorfman noninsurance entities. He is 

a member of the board of directors of the Northeastern Life Insurance 

Co. When Leo Perlman resigned from the insurance company 2 



IMPROPER activitip:s in the labor field 16061 

years ago the trustees of tlie Michigan conference welfare fund dele- 
gated to him the power of attorney to vote their stock. 

Mr. Kp:nnedy. He is a board member of the insurance company and 
also has power of attorney for the Michigan Conference of Teamsters 
welfare fund? 

Mr. Uhlmann. Yes, 

Mr. Kennedy, Dave Previant? 

Mr. Uhlmann. Dave Previant is counsel, chief counsel, I believe, 
for the Central States Drivers Council, and was retained at the same 
time by Union Casualty which is now the Northeastern Life Insurance 
Co, 

Mr. Kennedy, Has he also woi-ked for Allen Dorfman ? 

Mr. IThlmann. At one time he served Allen Dorfman, 

]Mr, Kennedy, How about Thomas W, Reynolds ? 

Mr. Uhlmann, Thomas Reynolds is the claim supervisor who is 
employed by the Northeastern Life Insurance Co., and has been since 
the spring of 1951. He is physically located and stationed in Chicago 
in Mr. Dorfman's office for the purpose of directing all fimctions 
identified with the processing and payment of claims. There is a 
conflict of interest there that is a very strong one suggested, in that 
for a period of time he also served as a trustee for one of the health 
and welfare funds that were insured through the Dorfman agency. 

Mr, Kennedy. That is local 713 ? 

Mr. Uhlmann, Local 713. 

Mr, Kennedy. And Joe Jacobs? 

Mr, Uhlmann, Joe Jacobs served concurrently as Paul Dorfman's 
attorney when he was head of the Waste Material Handlers Union, 
Local 1031, and other union locals, and both for the Union Casualty 
Co, and the United Public Service Corp., each of which were largely 
controlled and owned by Dr. Perlman, 

Mr, Kennedy. Another matter: Would you present to the chair- 
man a list of the insurance and noninsurance entities of Mr. Allen 
Dorfman so we could have those in the record ? 

Mr, Uhlmann. Yes, 

The Chairman, Do you have a list of them? 

Mr, Uhlmann. Yes, sir. 

Tlie Chairman, You have checked that list for accuracy, have you ? 

Mr. Uhlmann, Yes, 

The Chairman. It is correct? 

Mr, Uhlmann. It is. 

The Chairman, The list may be published in the record at this 
point. 

(The list follows:) 

DOEFMAN InSTRANCE AND NONINSURANCB ENTITIES 

Insurance entities: 

Union Insurance Agency of Illinois. 

Amalgamated Insurance Agency Services, Inc. 

Dover Insurance Agency, Ltd. 

Aldor Insurance Agency, Inc. 

Imperial Insurance Agency, Inc. 

Business Life Insurance Agencies, Inc. 

Cambridge Insurance Agency, Inc. 

Alro Agency, Inc. 

Allen Dorfman, general agent,* 



* Intermeshed with Aldor. 



16062 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Alro Insurance Agency, Inc.* 
David Probstein, general agent.* 
Cadillac Insurance Agency, Inc.^ 
Southwest Insurance Agency, Inc.' 
West Coast Insurance Consultants, Inc.* 
Noninsurance entities : 

Jack O'Lantern Lodge.' 
Joll Properties.^ 
Jack O'Lantern Lodge, Inc. 
Tecumseh Lodge, Inc. 
Mercury Investment Corp. 
Pan American Investment Corp. 
Sheridan Lien Co. 
Windsor Investment Co. 
Sheridan Investments, Inc. 
New Flamboyant Hotel. 
Northwestern Oil Co. 

Mr. Kennedy. How many insurance entities does he have at this 
point ? 

Mr. Uhlmann. There are 11 active insurance entities. 

Mr. Kennedy. Then he has some noninsurance entities; is that 
right? 

Mr. Uhlmann. Ten noninsurance entities. 

Mr. Kennedy. Do we find from an examination of the books and 
records that there is a transferring of funds from one company to 
another ? 

Mr. Uhlmann. Yes. That is a common and frequent occurrence. 
Mr. Kennedy, I would like to point out a development which recently 
came to our attention in relation to one of these insurance entities, 
which is on the list. It is identified as the West Coast Insurance Con- 
sultants, Inc. 

This company, this agency, is under contract with the Republic 
National Life Insurance Co., and that contract was dated last Sep- 
tember, September of 1958. 

In that agreement, it was stipulated that the West Coast Insurance 
Consultants, Inc., was authoried to obtain such welfare insurance as it 
could from Joint Council 37 of the Western Conference of Teamsters. 

They did, in fact, obtain such insurance. 

However, on the basis of information from the secretary of state 
and the Department of Insurance of the State of California, we 
find that this particular company is not a California corporation, and 
that it has not made any formal application to conduct insurance busi- 
ness in that State. We were also informed by the secretary of state 
of California that another company, identified as West Coast Insur- 
ance Consultants, was a partnership. Although the partners' names 
were included in the communication, the names are foreign to us. 

In the State of Illinois, we discovered that the West Coast Insur- 
ance Consultants, Inc., was, in fact, incorporated there, but only of 
recent date, so that the contract with Republic National followed the 
date of its incorporation in the State of Illinois. 

No application was made in that State for that company to conduct 
an insurance business there. 



^ Interrncshed with Ahlor. 

2 Writes casualty Insurance only. 

3 Not activated according to Allen Dorfmnn. 

* Formed in Seiitonil)er 1958 ; Sol Schwartz, a Dorfman employee, Is president. 
6 Jack O'Lantern Lodge was succeeded l)y Joll Properties. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16063 

Mr. Kennedy. Do we find that there are transactions back and forth 
in the financing of the various companies ? 

Mr. UiiLMANN. Yes. 

Mr. Kennedy. Would you just give it to us briefly, please? 

Mr. Uhlmann. Well, in the case of one of the companies alone, 
the largest of all in the Dorfman group, there is the Union Insurance 
Agency of Illinois, which is a partnership. We found that over a 
period of some 7 yeare or so there was an aggregate of 113 loans that 
were made, most of which were transactions between other companies 
owned or controlled by the Dorfmans. 

Mr. Kennedy. Mr. Chairman, I would like to call another witness 
now who is president of this company at the present time, the North- 
eastern Life Insurance Co. 

There will be a couple of other matters that we will have to go 
into later, however. 

The Chairman. All right. What is liis name? 

Mr. Kennedy. Mr. Hutner. 

The Chairman. Mr. Hutner, come forward, please. 

(Members of the select committee present at this point in the 
proceedings were Senator McClellan and Ervin.) 

The Chairman. 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. Hutner. I do. 

TESTIMONY OF HERBERT HUTNER 

The Chairman. State your name, your place of residence, and your 
business or occupation, please, sir. 

Mr. Hutner. My name is Herbert Hutner. I live in Harrison, 
N.Y. My business is president of the Northeastern Life Insurance 
Co. of New York. 

The Chairman. Thank you very much. 

You waive counsel, do you, Mr. Hutner ? 

Mr. Hutner. Yes, I do. 

The Chairman. You may proceed. 

Mr. Kennedy. Mv. Hutner, how long have you had an interest in 
Northeastern Life Insurance Co.? 

Mr. Hutner. Since May of 1956. 

Mr. Kennedy. What was the former name of this company ? 

Mr. Hutner. The original name was Union Casualty. Then it 
was Mount Vernon Life. 

Mr. Kennedy. That is the same company we have been discussing 
over the period of the last 2 days ; is that correct ? 

Mr. Hutner. That is correct. 

Mr. Kennedy. It is an entirely different group that is now operating 
the company ; is that right ? 

Mr. Hutner. That is correct. 

IMr. Kennedy. It is headed by you? 
• Mr. Hutner. That is correct. 

Mr. Kennedy. There is no affiliation with the old group ? 

Mr. Hutner. None whatsoever. 



16064 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. Tell me this: Do you still have still have any ar- 
ranp;ement with Mr. Allen Dorfman ? 

Mr. HuTNER. In March, I believe, of 1958 we canceled the agency 
contract with Mr. Dorfman because of the fact that the New York 
State Insurance Department had canceled his license. 

Mr. Kennedy. And were you instructed or urged by the New York 
State commission to cancel your relationship with Allen Dorfman? 

Mr, HuTNER. Yes ; we were. 

Mr. Kennedy. What was the date in 1958 ? 

Mr. HuTNER. I believe it was in March. 

Mr. Kennedy. In March of 1958. Since tlien you have had noth- 
ing further to do with Allen Dorfman ? 

Mr. Hutner. That is correct. 

Mr. Kennedy. That was on the instructions and direction of the 
New York State commission ? 

Mr. Hutner. May I mention the vested nature of his commission ? 

Mr. Kennedy. Yes. 

Mr. Hutner. I- asked might I mention the vested nature of the 
commission. 

When I inherited or got into the company and went into these 
various contracts that we had inherited, the contract of Mr. Dorfman 
called for in the event of termination of a vested right to receive a 
commission so long as the business was on the books of the insurance 
company. 

Tlie Chairman. Is this the union insurance business that he had 
been receiving commissions on? So long as that business remained 
on the books, he had a contract with the company that you took over 
to continue to pay him a stipulated commission? 

Mr. Hutner. Tliat is correct, sir. 

Mr. Kennedy. This giving him the vested commissions, this con- 
tract had been made back in 1953 ? 

Mr. Hutner. I believe originally he even earlier and then amended 
in 1953. 

Mr. Kennedy. Actually giving him the vested commissions ? 

Mr. Hutner. I am sorry, that is correct. 

Mr. Kennedy. Mr. Chairman, this is another aspect of the whole 
case which is so fantastic. They began an investigation of Allen 
Dorfman, the New York State Insurance Department, and also a con- 
gressional committee started looking into him. It was then decided 
to sign a contract with the insurance company, which Allen Dorfman 
signed with them, giving him a vested commission, so that if they 
found anything wrong and improper in Allen Dorfman, even if he 
lost his license in the State of New York, he continued to dra.w the 
commission. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16065 

They signed the contract in 1953 or 11)54, giving him the vested 
commission, and so, no matter Avliat happens now, supposedly, the 
insurance company is stuck with Allen Dorfman, or still has to pay 
him the money. 

The CiiAiKMAN. Wliat is the amount of it? Let us get that into 
the record. 

Mr. HuTNER. The amount of the 

The Chairman. Of the vested commission on that you are having 
to pay. 

Mr. HuTNER. I got some not«s this morning to refresh my recol- 
lection. 

The vested commission — the original commission was 1.1 percent 
and the vested commission is 1 percent. 

Mr. Kennedy. How much does that amount to ? How much did it 
amount to, for instance, last year, this commission ? 

The Chairman. Do you know 'i 

Mr. Hutner. I don't have the records with me, sir. 

The Chairman. That is a pretty good vested commission, isn't it? 

Mr. Hutner. Yes it is. 

Mr. Kennedy. It is approximately $560,000. Would that sound 
right to you ? 

Mr. Hutner. Well, it might be. I w^ould have to check. I would be 
glad to give you the exact figure. 

The Chairman. Do you mean $560,000 per year? 

Mr. I^NNEDY. Yes. 

The Chairman. That you have to pay in commissions on this union 
business ? 

Mr. Hutner. Well, let me see. I don't think it is that much. I 
think the premiums came to some $15 million, so 1 percent would be 
$150,000. Isn't that right ? 

Mr. Uhlmann. I believe Mr. Kennedy's question was directed at all 
of the Dorfman group business and not confined to the two Teamster 
groups. 

Mr. Kennedy. The ones that he has vested commission on. 

Mr. Hutner. I underetand. I would like to furnish the committee 
with the correct figures. 

The Chairman. Will you do that? 

Mr. Hutner. I will. 

The Chairman. Supply them and they will either be printed in 
the record at this point or made an exhibit for reference. I do not 
know how long the list should be. It should be comparatively short, 
shouldn't it? 

Mr. Hutner. Yes. 

The Chairman. It will be printed in the record at tJiis point. Sup- 
ply it under your oath. 



16066 IMPROPER ACTIVITIES IN THE LABOR FIELD 

(The material to be furnished is as follows :) 

NOETHEASTERN LiFE INSURANCE Co. OF NeW YOBK 

Commissions paid to Union, Dover, etc., Insurance Agencies during the year 1958 
{owned by Allen and Rose Dorfman) 

Waste Material Handlers' Union $735. 95 

Local 743 8, 863. 89 

Local 1031, I.B.E.W 18, 830. 45 

Amalgamated Insurance Agency 178. 87 

Local 580 208. 74 

Michigan Conference of Teamsters Welfare Fund 48,990.62 

Local 405 625. 79 

Thomas Paper Stock 602. 38 

Waste Trades Industry 1, 091. 78 

Contract Steel Carriers 104. 57 

B. Cohen & Sons 26.34 

Mercury Record Co 276. 60 

Local 876 1, 981. 83 

J. L. Keeshin 750.04 

Local 713 "A"— Health and Welfare Fund 947.70 

Carnival Workers 1, 351. 72 

Local 688 648. 86 

Local 713 "B"— Health and Welfare Fund 3, 529. 01 

Rayco Auto Seat Covers 243. 68 

Local 610 324. 50 

Local 58 5. 85 

Local 447 

Bergman and Lefkow, Inc 23. 56 

Central States Drivers Council, Southeast and Southwest Areas 

Health and Welfare Fund 122,939.75 

Albert, Inc 158. 71 

Local 72G 115. 16 

Herold Products 40. 14 

Essex Graham 83. 72 

Total 213, 680. 21 

Senator Ervin. That is certainly an unusual contract, that a man 
should get a commission on insurance after he has forfeited to the 
State his right to engage in the business of soliciting and obtaining 
insurance. 

Mr. HuTNER. Well, I think it is, except this : That in the insurance 
field, I think you will find that it is not unusual for a contract with a 
broker or agent to contain a clause stating that the commissions that 
he has earned will be vested. 

Senator Ervin. I suppose that would be true ; yes. 

Mr, HuTNER. But when it gets into the size of this thing, and if it 
grows as it has, it appears to be quite a lot. 

Senator Ervin. In other words, it would seem to thwart public 
policy, public policy vested in the insurance commissions of the var- 
ious States, for authority to grant licenses and to revoke licenses. 

Here they apparently revoked the license for misconduct, yet the 
man continues to draw commissions after his license to engage in that 
business has been forfeited; pursuant to this contract he continues. 

Did you ever consult an attorney to see whether it would be against 
public policy, a provision like tliat? In other words, it would be like 
my practicing law, practicing law with a pai'tner, and I sign a con- 
tract with him that he is going to have to give me a certain percent 
of the earnings of the partnership, even if I cease to be a member of 



IIVIPROPER ACTIVITIES IN THE LABOR FIELD 16067 

the partnership, and even if I have been disbarred from tlie practice 
of law, 

I think it is a serious question of law as to whether a contract of 
that nature is not contrary to public policy. 

Mr. IIuTNER. Well, we certainly will look into it. We have had 
some law^yers look at the contract, and they felt that it was one that 
would have to be enforced. 

Senator Ervin. If I were your lawyer, I would make him bring suit 
on it. 

Mr. Kexnedy. Especially, Senator, when the contract is made 
pending an investigation. This wasn't a contract with vested com- 
missions going back to 1949 and 1950. This was a contract that was 
made in 1953, after the original contract between Allen Dorf man and 
the insurance company had been signed. 

As far as the question of the fraud involved, the State Commission 
of New York was questioning in great terms the public policy of this, 
whether this contract that was signed with Allen Dorfman had fraud 
involved in it. 

Mr. HuTNER. Mr. Kennedy, I just want to say this on that subject. 
After you mentioned this to me last night, I called the department 
this morning and I asked whether anybody had pursued that line, that 
the contract was fraudulent. I was told by the head of the life divi- 
sion that as far as he knew they had not said that. 

That doesn't mean from the standpoint that the Senator mentioned, 
of public policy, that it might not very well raise another question 
here. 

Mr. IvENNEDY. Mr. Ulilmann, Mr. Chairman, has just figured out 
what the vested commissions amount to. 

The Chairihan. Mr. Uhlmann, you are under oath. You may tes- 
tify as to the amount of dollars and cents which are involved in this 
vested commission. 

TESTIMONY OF MARTIN S. UHLMANN— Resumed 

Mr. Uhlmann. With respect to commissions for this year, it is esti- 
mated that the vested commission amoimt will aggregate about 
$212,000. 

With respect to — I am sorry. 

Mr. Kennedy. $212,000 is the vested commissions ? 

Mr. Uhlmann. Yes. That covers vested commissions on all Dorf- 
man groups carried on the books of Northeastern Life. 

INIr. Kennedy. That is the first matter. 

Now, at the urging of the New York Commission, you broke off the 
relationship with Allen Dorfman? 

TESTIMONY OF HERBERT HUTNER— Resumed 

Mr, Hutner. Yes, 

Mr. Kennedy. Who services your insurance business now ? 

Mr, Hutner. The Republic National Life of Dallas, Tex, 

Mr. Kennedy. They do the servicing for you ? 

Mr. Hutner. INIay I explain that? 

Mr. Kennedy. Just answer the question. 



16068 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. HuTNER. Yes. We have a contract with them for them to do 

^^'MrKENNEDY. mo does the servicing for them on these insurance 

policies? 

Mr. HuTNER. Mr. Dorfman. 

Mr. Kennedy. So what has happened 



Z SrZ.°i?tharA£ Dorf,„an, instead of going directly 
to Allen Dorfman, because of the orders of tlie co.nmiss.on n New 
York "hat happens now is that you go through the Republic Na- 
tional rn—rCo. of Texas, and'they go through Alien Dorfman; 
is that right? 

M;:: KtT^oY.'s^Ihe saSe'relationship exists except you go through 

"" Mr'^Hu™. Well, not quite, Mr. Kennedy I" ^hat connecdon, 
we last year were able to reduce the servicing fee from oi/o to 2 per- 
cent insofar as the Central States was concerned, and from 31/2 to 3 
perceTso far as Michigan Conference was concerned So we were 
J^bL to effect a saving of $218,000 in connection with the servicing. 
Mr Kennedy Wa^s that after our mvestigators went m and showed 

^llf CT^'TeTl cann'r^ay it was exactly that way. It was 
somewS™om.d that time. Welave tried to ^eUl.ese thing dow^^ 
as best we can. We came into a situation where we found this con- 
tract hi existence , and our company is relatively small, and we haye 
99 emplovrs and if we were to lose this business it would result m 
fveTsharp cur ailment of our business. We are trying to build 
Sp our ordinary life business. I don't want to get away from your 

^^Mr.^KENNEDY. You reduced the service fees? 

Mr K^D-Y.^^Butlvhat happens is that you got the reduction of 
servke fees%ut your relationship with Allen Dorfman is now con- 
ducted through Republic National rather than directly. 

Ml nu?NER. That is correct, and we look to Repiib lie as a large 
company for this. If there was anything wrong with the servicing, 
or any mismanagement or anything like that we yo^^^Jiave a com- 
pany witli several billion dollars in force to look toward to see that 
servicing is handled properly. -nnrfmnn the 

Mr. Kennedy. Actually they are charged by Allen Doitman tne 

same amount that you paid them ? 

^r SE™Y.'wtTrthe quid pro quo for the Republic National 
then? You have reinsured a greater amount with them? 

Mr HuTNER We have reinsured some more insurance with them. 

Mr Kennedy. What they get out of it is more reinsurance business 
and tiiey are willing to handfe this kind of an arrangement for you? 

Z: l^S^DY '^rwJ;;^n'ryou break off the relationships with 

^ Mr m™.' Completely, you mean ? We broke them off, but we 
kept the business. I would say it was an economic situation, and 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16069 

a practical one to this extent : We went as far as we could to reduce 
these fees to as low a fio^ure as we could. 

As I started to say, tlie people connected with the company, as Mr. 
Kennedy has pointed out, are people that have come into this thing 
fairly recently and wlio inherited this. We were simply faced with 
this question : Shall we give up this business completely and just say, 
"Well, because of the situation with Allen Dorfman we are just goino- 
to cancel out the entire thing," or should we see whether it is possible 
to continue the business, raising the level of it to the highest plane 
possible and giving the most efliciency and honest operation that we 
could ? 

We checked with other insurance companies, and a number of o'lv 
directors and stockholders are officers, senior officers and directors, of 
some of the largest companies in America. We discussed the thing at 
great length, and we came to the conclusion that insofar as we could 
operate this thing in a way that the policyliolder, that is, these welfare 
funds and the trustees and the beneficiaries, would receive an honest 
and efficient handling of their funds as far as the insurance company 
V. as concerned, we would not be doing anything different than if we 
lost the case and ^Metropolitan or Prudential or anybody else took it 
up as has happened, for example, on the west coast with .^tna, which 
IS one of our outstanding companies taking up the Occidental case. 
Mr. Kenni-dy. In other words, you knew that if you broke off re- 
lationships completely with Allen Dorfman you would lose the Team- 
ster account? 

Mr. HuTNER. We felt that way ; yes, sir. 

Mr. Kennedy. Well, in conversations with various individuals you 
were led to believe that if you did not retain this relationship with 
Allen Dorfman you would lose the Teamster account ? 
Mr. Hutner. I had tliat feeling; yes. 

Mr Kennedy. Did you understand what relationship Allen Dorf- 
man had with the Teamsters Union which would warrant such a 
result? 

Mr. Hutner. I just understood that he had had this business for 
many years, and we assumed that he had a very close relationship or 
friendly relationship with the people involved. 
Mr. Kennedy. Which is Mr. Hoffa. 
Mr. Hutner. Yes. 
n ^^^^- ^^ennedy. Now, did you tell the Eepublic National Insurance 
Co of lexas that they would have to make this arrangement with 
Allen Dorfman m order to get this business ? 

Mr. Hutner. Well, I told them they would have to make some ar- 
rangement with Allen Dorfman to get the business. 
Mr. Kennedy. Because of what fact ? 

Mr. Hutner. That I knew we would lose it or I felt we would lose 
It otherwise. 

Mr. Kennedy. So what this amounted to was that the New York 
commission told you to break off this relationship with Allen Dorf- 
man as far as his servicing the insurance, and you knew that yo^i had 
to come up with some idea to be able to keep Allen Dorfman in :here. 

Mr. Hutner. TVel , I might go further than that, and I might say 
that we went to the department and we said we felt it would hurt our 
company immeasurably to lose this business and if we could keep it 

36751— 59— pt. 43 Q 



16070 IMPROPER ACTIVITIES IN THE LABOR FIELD 

n^A if there was any way we could possibly handle the business, hav- 

of the New York law, we would like to do it. ihis metnoa was 
'^Mr'^fiNNlDT'^ Dki the New York Commission know you were 



doing this ? 

Mr. HuTNER. Yes, sir 



Mr SSnedy Do t ey know the same relationship existed betw en 
vof and Allen borf man except it was done through a third party? 
^ MrHr™ I don't tliink-it just depends on the way you put it- 
we feerthat we have a go-between who is very strong, and whom we 
nn.^ lr>nl- tn for oertain things that we couldn t betore. 

Lcomlfy, 4 were able fo reduce the servicing fee considerably as 

" S'cl unMfN'"Tlie question is did the New York Commission or 
the N^ew YoTruthority that required the cancellation of his con- 
tract! ck they know of L arrangement you have with the Eepublic 
and Eepublic has with Dorf man ? 

Mr HuTNEK. I believe they do. , , t^ i *!,„+ 

The Chapman. You say Vou believe they do. Do you know that 

^^'mi^Hutner. Well, I would say yes, I think they do. I tbink that 
they df know it. I would like to have someone ask them, and I don t 

'^ The FHliSrT>!!' Th^^ is, there basnet been a purpose on your 

^ Mr'^H^i'No! sir; I have a memorandum which I submitted 
to^e De^rtment befoii we did this, and I think Mr. Uhlmann saw 

"" ThJcHAmMAN. I wanted to get it in the proper light You haven't 
been a party to trying to deceive the New York authorities ( 

Mr. HuTNER. Absolutely not. and we gave them a memorandum be- 
fore we did anything. 

The ('hairman. All right. . , ,. i n ,«„f 

Mr Kennedy. Would you agree that it doesn t make really a gieat 
deal of sense to have the New York Commission order you to break 
off the relationship with Allen Dorfman, and then you, with anothei 
large insurance company, get together to do what you are not sup- 
posed to do directly, but to do it indirectly ? 

Would you agree that really doesn't make too much sense ( 

Mr Hutner. Well, I agree that it may look that way, and again 1 

say tliat we were faced with two rough alternatives, and we made two 

chan*'-es again I repeat, in the servicing fee, and m having a strong 

servicing agent in between. We felt that that, was as far as we could 

go in keeping the business. , ■ j- j i-i „f 

Mr Kennedy. Was Mr. Kunis one of those who informed you that 

it would appear that you would lose the business if you didn t keep 

the relationship? 

Mr IltJTNER. I believe he did make such a statement. 

Mr. Kennedy. Mr. Kunis is one of those, a consultant not only 
for the insurance company, but he is a consultant for various of the 
Toanisters unions, INTr. Chairman, and he is one of those who would 
appear to have a conflict of interest. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16071 

Tlie CiiAiKMAX. He is interested in the Teamsters Union und he is 
one of their consultants. 

Mr. HuTNER. I believe lie is a consultant to their pension fund; 

The Chairman. And he suggested to you the probability ot your 
losing the account if you didn't make some arrangement with T)orf- 
nian; is that correct? 

Mr. IIiTTNER. That is correct. 

Mr. Kexneoy. So again, Mr. Chairman, it shows this very strange 
and peculiar relationship that exists between the head of the fund, 
Mr. Iloifa, and Mr. Allen Dorfman, that that kind of an arrangement 
would have to be entered into in order for this insurance company to 
keep the business. 

Xow, a memorandum was filed with this committee some couple of 
months ago, after we had the hearings before the committee, brief 
hearings last year in connection with tlie insurance. (\)uld you tell 
us about that ? 

Mr. IIuTNER. Well, when you asked me about it yesterday, I said 
that I wasn't sure who had gotten it up. This morning I called our 
actuarial department, and they tell me that Mr. Kunis in his capacity 
as consulting actuary got it up. 

I might say that since most of it, as I said yesterday, is technical 
I wouldn't be in a position to go into the matters contained therein, 
and I would suggest that if there are any questions on it that Mr. 
Kunis be called. 

^Nlr. Kexxedy. It is furnished to us by the attorney for the I'eam- 
sters I'nion from the insurance company, of which you are president. 

Mr. HuTNER. That is correct, but I didn't know that it had been 
furnished for that purpose. 

Mr. Kexxedy. It is filled with inaccuracies. 

Mr. HuTNER. It is filled with inaccuracies ? 

Mr. Kexx'edy. As far as figures are concerned. 

Mr. Hutxer. Well, again I think somebody should question the 
actuary on that, because it is an actuarial thing which is a professional 
ty^De of thing. 

Mr. Kexxeuy. Was he representing the insurance company or 
representing the Dorfmans, or representing the Teamstei-s when he 
made this up ? 

Mr. HuTNER. He presumably was representing us, because he said 
that there had been certain inaccuracies in the testimony here, and he 
thought that the company should submit a report which would from 
an actuarial standpoint straighten that out. 

Mr. Kexxedy. His name does not even appear in here. 

Mr. HuTXER. Well, I don't know why it does not, because he was 
the one who drew it up. 

Mr. Kexxedy. It is signed by Lawrence Monnett. 

Mr. HuTXER. He is a vice president, but the report itself was drawn 
up by Mv. Kunis. 

^Ir. Kexxedy. It was submitted by a vice president of the company, 
and prepared by a consultant and furnished to the committee by the 
attorney for the Teamsters Union. 

Mr. iluTXER. I did not know that it was going to be furnished by 
the attorney for the Teamsters, Mr. Kennedy. It was gotten up pre- 



16072 IMPROPER ACTIVITIES IN THE LABOR FIELD 

sumably to straighten out some inaccuracies that had appeared in the 
record. 

The Chairman. This document, should it be made an exhibit? It 
seems to me perhaps it should be identified and made an exhibit. 

Can you identify this document? 

Mr. HuTNER. I believe I can, if I may see it for a moment. I have 
seen it and read it. 

The Chairman. It is submitted here under an affidavit of La-w- 
rence L. Monnett, Jr. Do you recognize this document as the one 
that was ])repared by your consultant, I believe, and presented to the 
-attorney for the Teamsters by your Mr. Monnett, the vice president ? 

Mr. HuTNER, Yes ; I do so identify it. 

The Chairman. It will be made exhibit 228 for reference, together 
with the covering letter of transmittal of Mr. Previant. It will be 
made exhibit 228 for reference. 

(Document referred to was marked "Exhibit No. 228" for reference 
and may be found in the files of the select committee.) 

Mr. Kennedy. Now, there is just one other matter on the question 
of the insurance commission in New York questioning this ari^nge- 
ment made in 1953. I call your attention to page 46 of their report, 
in which they describe this letter and this situation, and they state 
that the wliole purpose of this procedure was obviously an expedient 
to protect the agent, irrespective of what may subsequently occur, and 
thus retain his business. 

So they did question the agi'eement that had been made. 

Mr. HuTNFJR. Yes. 

Mr. Kennedy. You found from your review and your own personal 
knowledge that it was Allen Dorfman who was the one making the 
decisions in connection witli this insurance? 

Mr. HuTNER. Well, we felt that he had a great deal to say about it. 

Mr. Kennedy. Tliat is all. 

Senator Ervin. I just want to say it is fairly refresliing to have 
a witness come before this committee and testify Avith frankness and 
without taking any refuge behind the fifth amendment, and I want to 
commend you for it. 

Mr. HtTTNER. As a matter of fact, I came down here without any 
counsel and without any records or anything else. I thought I was 
just going to have an informal discussion, and when Mr. Kennedy 
asked me to testify I said I would be glad to. 

The Chairman. You just bought into a bad situation; didn't you? 

Mr, HuTNER. Well, certainly at times it has made me feel very 
unhappy that we ever bought into it. 

Mr. Kennedy. Wliat would happen if you lost the Teamster busi- 
ness ? 

Mr. HuTNER. Right now, you mean ? 

Mr. Kennedy. Yes. 

Mr. HuTNER. I think that we would probably have to cut back our 
operations to about 20 people, because that is about the size of our 
ordinary business and our other groups. I feel that so long as the 
business can be handled by insurance companies that we should be 
able to handle it and we are doing an honest and open job in handling 
it. We have the facilities, the administrative help at our home office, 
and we have been working on this thing for many many years, and 
with the business to be transferred to any of the other large companies 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16073 

which, as I said before, would be delighted to get it, I think that it 
would take them quite a while, and we made some studies on that, for 
the business to be set up in a way that it would be handled efficiently, 
and that it would cost the fund quite a bit of money to make such a 
change. I think that the trustees of the fund are aware of that fact. 

I would like to say one other thing because we have been tied up 
with many people in Mr. Uhlmann's readings. We have a board of 
directors of 17 directors and, of course, that is a matter of record 
which I might submit to you gentlemen. They are all outstanding 
people in the community and in the country. One director that was 
mentioned as representing Air. Dorfman, we invited to come on the 
board for this reason : the welfare fund and the Michigan Conference 
owns a block of stock in our company, and we felt that they should 
be represented on our board. It is just like anybody else that owns 
stock in the company. 

Mr. Kennedy. You asked who for a representative ? 

Mr. HuTNER. The fund. 

Mr. Kennedy. Allen Dorfman? 

Mr. Hutner. We asked Allen Dorfman, would he convey this at 
that time, and he was the agent of the company, and he was the one 
who suggested that we put this fellow Lissner, who is a lawyer in 
Chicago, on the board. 

Mr. I\JENNEDY. Why should Allen Dorfman be the one selecting the 
representative for that? 

JMr. HuTNER. I don't know whether he made the selection himself, 
Mr. Kennedy. I just say that that was the way we did it. 

Mr. Ivennedy. Allen Dorfman calls the shots for the welfare fund ; 
would you say that ? 

Mr. Hutner. I don't know. 

Mr. I\JENNEDY. Do you find that to be true ? 

Mr. Hutner. I just don't know. 

Mr. Kennedy. You don't want to say ? 

Mr. Hutner. Well, I wouldn't want to say then. It is hard for me 
to say. 

But as far as the other people are concerned, they had some retain- 
ers. This Phil Goodman and Previant had a retainer with the com- 
pany, and they handled some small matters for the company, and Mr. 
Goodman is an old friend of Mr. Dorfman's. I found him a person 
that was veiy reasonable and easy to deal with and he was helpful to 
us in our relationships with Mr. Dorfman. 

Mr. Kennedy. Did you know Phil Goodman was a business partner 
of Jimmy Hoffa as well as Mr. Dorfman ? 

Mr. Hutner. I didn't know that, Mr. Kennedy. 

Mv. Kennedy. Well, he has been, and they have been in business 
together, the three of them. How much do you pay for service fees 
to Dorfman through the Republic National ? 

Mr. Hutner. I just asked them today to give me the savings, and 
may I give you tliose figures in connection with the figures that I am 
to furnish? 

The Chairman. You mean savings by reason of this reduction that 
you already testified to ? 

Mr, Hutner. Yes; the $218,000, but I don't have what was paid, 
which is what Mr. Kennedy would like. 



16074 IMPROPER ACTIVITIES IX THE LABOR FIELD 

Mr. Kennedy. I believe that we liave the figures, and so maybe 
you can tell us if it is correct. 

Mr. UnLMANN. The fiorures we have show that the service fees on 
a reduced basis for the Dorfman o;roups carried on the Northeastern 
Life's books, run about $230,000 a year. 

Mr. Kennedy. Together with the vested commissions, and the serv- 
ice fees, they are still getting almost $500,000 a year out of this. 

Mr. Uhlmann. Slightly under that; yes. 

The Chairman. Is there anything further? 

Thank you very much, Mr. Hutner. 

Call the next witness. 

]\fr. Kennedy. I want to finish up a few things. Mr. Uhlmami, 
would you return to the stand ? 

I would also like to call Mr. Goodman. 

TESTIMONY OF SEYMOUR GOODMAN— Kesumed 

The Chairman. These witnesses have been previously sworn, and 
you may proceed under the same oath. 

Mr. Kennedy. Yesterday you referred to excessive commissions 
that had been referred to in some pamphlets and reports made by the 
New York insurance department. Can you give us the specifics on 
that, so that we can refer to them? 

Mr. Goodman. Yes, sir. In a report entitled "Whose Welfare?" 
which is your committee exhibit 220, at page 108 of the report there 
is a table numbered 19. One of the welfare fund cases among others 
listed there, is that of the Central States Drivers Council and South- 
ern Conference of Teamsters. 

This was a case wherein by the United States Life Insurance Co. 
and the agent of record as we have it here is the United Public Serv- 
ices Corj). These are identified by code number, 43 representing the 
United States Life Insurance Co., and 91 representing the United 
Public Services Corp., and 123 representing the Central States Drivers 
Council and Southern Conference of Teamsters welfare fund. 

At page 104 of the report there is a discusion of that particular 
group case. 

I will lead into it by the paragraph preceding. 

Similar variations in compensation may be observed in table 10 for union 
welfare cases involving premium volumes of about $500,000 to $900,000. Here 
the scale of plan 442 serves as the yardstick for a reasonable level of commis- 
sions closely approximating the typical scale. Insurer 43 illustrates the use of 
different scales by one insurer. 

In the case of plan 128 — 

the Central States — 

this insurer paid service fees as well as commissions on a decremeutal scale 
which was considerably higher than a typical scale. 

At page 200 of the repoit there is a table whicli is identified as table 
K, and it includes eight selected agents to indicate tliose Avho are 
receiving what we consider to bt' excessive commissions. Union In- 
surance Agency of Illinois is identified there by code No. 168. 

At page 203 of the same report a table L, which is designated ''Se- 
lected instances of high commissions and fees i)aid on union welfare 
cases," includes two cases of which the Union Insurance Agency of 
Illinois is identified bv code 1G8. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16075 

Tlie two causes ai-e code Xo. 139, Micliigrtii Conference of Teamsters 
welfare fund, and 1-40, Trustees and Successors of tlie Central States, 
Southeast and Southwest Areas Welfare P'und. 

In a Liter report entitled "Private Employee Benefit Plans of Pub- 
lic. Trust," your connnittee exhibit Xo. 221, at page 212 of the report, 
tlie comment a[)pears : 

Table 1 presents data for selected policies of four f)ther insurance companies. 
It further illustrates that high commissions and administration fees almost 
invariably reduce benefit payments and dividends or experience rating credits 
and reflects unfair discrimination among policyholders. 

Table 41, which is at pao;e 214 of the report, identifies the Union 
Casualty Co., that is. Union Casualty & Life Insurance Co., under 
the code designation of ¥. The case is, of the welfare fund, identi- 
fied as U-8, which is local 1031 of the International Brotherhood of 
Electrical Workers, AEL. The agent designated as 168 is Union In- 
surance Agency of Illinois. 

Mr. Kexnedy. Is that all? 

Mr. GooDMAx. Yes, sir. 

Mr. Kennedy. I appreciate that very much. 

I would like to call another witness, Mr. Chairman. 

This is just another example, Mr. Chairman, of the operation and 
the milking of the funds. I would like to call a witness who has been 
subpenaed here, ]Mrs. Martha Lucas. 

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 noth- 
ing but the truth, so help you God ? 

Mrs. Lucas. I do. 

TESTIMONY OF MARTHA LUCAS 

The Chairman. State your name, your place of residence, and 
your business or occupation, please. 
INlrs. Lucas. Martlia Lucas, 5400 West Chicago Avenue, Chicago, 

The Chairman. What is your present occupation ? 

Mrs. Lucas. I am m the furniture business. 

The Chairman. You are in the furniture business? 

Mrs. Lucas. Yes, sir. 

The Chairman. Do you have counsel or do you wish an attorney 
to represent you, Mrs. Lucas ? 

Mrs. Lucas. Xo, sir ; I was subpenaed. 

The Chairman. All right, Mr. Kennedy, you may proceed. 

Mr. Kennedy. ]\Irs. Lucas, on occasion you have had business deal- 
ings with the Dorfman Co., we have fouiid, from an examination of 
their records and your records. Is that correct ? 

jNIrs. Lucas. Yes, sir. 

]Mr. Ivennedy. And you have sold Allen Dorfman furniture? 

Mrs. Lucas. Yes, sir. 

Mr. Ivennedy, I would like to ask you to examine these invoices 
that I have here. First, invoice Xo. 3303. 

Mrs. Lucas. Yes, sir. 



16076 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. I present to you an invoice dated April 15, 1956, 
from the Lucas Co., made out to Aldor Insurance Agency, the in- 
voice in the amount of $1,000, No. 3303. 

Will you examine that invoice and state if you identify it? 

(The document was handed to the witness.) 

Mrs. Lucas. Yes, sir. 

The Chairman. What is it ? 

Mrs. Lucas. It is our invoice. 

The Chairman. I beg your pardon ? 

Mrs. Lucas. It is our invoice, a copy of an invoice. 

The Chairman. A copy of your invoice, the invoice from your 
firm? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. That invoice is dated April 15, 1956, It describes 
two desks, two chairs, one conference table and eight chairs, and 
$1,000; is that right? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. Did you, in fact, provide two chairs, two desks, one 
conference table and eight chairs to Allen Dorfman? 

Mrs. Lucas. No, sir. 

Mr. Kennedy. The invoice is a fake ? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. Why did you make a fake invoice? 

Mrs. Lucas. I believe it was requested. 

Mr. Kennedy. Wlio requested you to make a false invoice ? 

Mrs. Lucas. Well, someone from the firm. 

Mr. Kennedy. Wlio did ? 

The Chairman. Whose firm, yours or Mr. Dorfman's? 

Mrs. Lucas. No : from Mr. Dorfman's. 

Mr. Kennedy. T\nio requested you from Mr. Dorfman's firm ? 

Mrs. Lucas. I can't be sure on each one. 

Mr. Kennedy. Was it Mr. Dorfman ? 

Mrs. Lucas. I couldn't be exactly sure. 

Mr. Kennedy. Who else do you know in the firm? 

Mrs. Lucas. One of the girls. 

Mr. Kennedy. Wliat girls do you know? 

Mrs. Lucas. I don't recall her nam.e I don't recall the exact name. 

Mr. Kennedy. You know the difference between Allen Dorfman 
and a girl. 

Mrs. Lucas. But it is so long ago, T can't remember exactly. 

Mr. Kennedy. Let me see if I can bring you more up to date, then. 
I will present to you some six or seven more invoices. 

The Chairman. The Chair presents to you an invoice, No. 3305, 
dated November 8, 1956, in the amount of $1,000, issued bv your com- 
pany, the Lucas Co., to the same insurance agency, Aldor Insurance 
Agency, and it says for recarpoting conference room. 

I also present to you a similar invoice, No. 3352, dated February 
11. 1957, shown to be for one conference desk and chair in the amount 
of $950 79, and carpeting in the amount of $1,000, making a total of 
$1,950.79. 



IMPROPER ACTIVITIES EST THE LABOR FIELD 16077 

I present to you another invoice, No. 3300, dated April 22, 1956, and 
which recites that it is for one sofa and two chairs m the amount of 
$500. 

Another one, No. 3302, dated May 10, 1956, in the amount of $1,000, 
and it says it is for four desks and four chairs, per order. 

And another one, No. 3304, dated November 10, 1956, which says it 
is for four desks and four chairs, $1,000, 

And another one, No. 3354, dated February 6, 1957, in the amount 
of $850.12, which says it is for one large built-in cabinet. 

I will ask you to examine these six invoices that I have just men- 
tioned, and state if you identify' them. 

(The documents were handed to the witness.) 

The Chairman. Do you identify those invoices ? 

Mrs. Lucas. Yes, sir. 

The Chairman. Those invoices may be made exhibit No. 229-A, 
B, C, D, E, F, and G in the order in which the Chair mentioned them 
to the witness. 

(The invoices referred to were marked "Exhibits Nos. 229-A 
through 229-G", inclusive, for reference and will be found in the 
appendix on pp. 16185-16191.) 

The Chairman. May I inquire whether any of the merchandise 
called for by those six invoices was actually delivered to the pur- 
chaser, Aldor Insurance Agency ? 

Mrs. Lucas. No, sir. 

The Chairman. No part of the merchandise listed in either of those 
six invoices was either purchased by the Aldor Insurance Agency 
from the Lucas Co., nor was any of it delivered to the insurance 
agency ; is that correct ? 

Mrs. Lucas. Yes, sir. 

The Chairman. Are these six, in addition to the other one you 
identified, all bogus invoices ? 

Mrs. Lucas. Yes, sir. 

The Chairman. And for what reason were these bogus invoices, 
made out? 

First, counsel suggests, and I think it is well, did you ever deliver 
any of the merchandise, your company, any of this merchandise to 
the Aldor Insurance Agency ? 

Mrs. Lucas. Not of that merchandise. 

The Chairman. I beg your pardon ? 

Mrs. Lucas. Not of that merchandise. 

The Chairman. Not of this merchandise ? 

Mrs. Lucas. No, sir. 

The Chairman. That is, that is listed here? 

Mrs. Lucas. No, sir. 

Tlie Chairman. Did you deliver other merchandise to them that 
the agency bought ? 

Mrs. Lucas. A long time ago. 

The Chairman. How long ago ? 

Mrs. Lucas. I can't recall exactly. 

The Chairman. Was it a long time before these invoices were made 
out? Is that right? 

Mrs. Lucas. I couldn't be certain of the dates. I couldn't be cer- 
tain what it was or when, from here. 



16078 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. Mr. Counsel, you may proceed. 

Mr. Kennedy. Did you make deliveries of any kind of furnishings 
or furniture in connection with tliese invoices? Did you make de- 
liveries to Allen Dorf man's home, for instance ? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. And did you make deliveries to Rose Dorf man's? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. These were furnishings for their private homes ; is 
that correct? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. And these invoices here are to cover those deliveries 
that you made ; is that right ? 

Mrs. Lucas. No, sir; I billed them for what I delivered to their 
homes. 

Mr. Kennedy. You billed them separately for that? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. What was the purpose of these invoices that we 
have here ? 

Mrs. Lucas. To receive payment. 

Mr. Kennedy. To receive payment ? 

Mrs. Lucas. Yes. 

Mr. Kennedy. For the other furniture ? 

Mrs. Lucas. Yes. 

Mr. Kennedy. It was to receive payment for the furniture that 
you delivered to their homes? 

]Mrs. Lucas. Yes. 

Mr. Kennedy. So that instead of them paying you privately or 
paying out of their own personal accounts, the nisurance company 
accounts were paying for the furniture; is that right? 
' Mrs. Lucas. Yes, sir. 

Mr. Kennedy. And the invoices would make it appear that the 
furniture was office furniture when, in fact, it was home furniture? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. And these invoices would permit the companies to 
make checks out to you to pay for the furniture ; is that right ? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. That is what liappened ? 

Mrs. Lucas. I received checks. 

Mr. Kennedy. From these two companies, the Aldor Insurance 
Agency and the Union Insurance Agency ? 

IVIiss Lucas. Yes, sir. 

Mr. Kennedy. Then those in turn, Mr. Uhlmann, were deducted as 
ex])enses ; is that correct ? 

Or you can tell that, Mr. Findlay. 

Mr. Findlay. $8,5^50.12 was cliarged on the books of Union In- 
surance Agency as furniture and equipment, and $3,1)50.79 on the 
books of Aldor Insurance Agency. In this manner, their accountants 
were able to depreciate the furniture and take it as a deduction as an 
operating expense, rather than as a j^ersonal expense. 

Tlie Chairman. Tlie.se seven invoices total $(,300.91, if the Chair 
calculated correctly. 

Senator Ervin, 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16079 

Senator Ervin. Did you examine the income tax for these insur- 
ance companies^ 

Mr. FixDLAY. Yes. 

Senator P^rvix. Did they take depreciation for the office furniture? 

Mr. FiXDLAY. Yes, they do. In fact, the total of the furniture 
equi[)ment account and otlice equipment on the books, there is an an- 
nual depreciation on the basis of the figures which includes these 
fictitious invoices. 

The Chairman. They were charged as expenses to the insurance? 

Mr. FiNDLAY. To the Union Insurance Agency and Aldor Insur- 
ance, Inc., tlie companies owned by Allen and Rose. 

Senator Ervin. I think maybe it is not altogether inappropriate 
to make the observation that whoever handled this transaction was 
sort of like the saying about providence, that it moves in mysterious 
ways, its wonders to perform. 

]Mr. Kex^nedy. With whom was the arrangement made on the later 
invoices? Allen Dorfman? 

Mrs. Lucas. I always talked to Allen and one lady at the office. I 
couldn't be sure which. 

jNIr. Kennedy. "Who told you to make these fictitious invoices? 

Mrs. Lucas. Someone from one of the 

Mr. Kennedy. You know who it was ? 

Mrs. Lucas. I talked to both of them, sir. I honestly did. 

Mr. Kex^nedy. You talked to both of them about it ? 

Mrs. Lucas. Yes, sir. Honestly. 

Mr. Kennedy. The girl in the office and Allen Dorfman? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. Both of them you talked to about making these 
phony invoices? 

Mrs. Lucas. Yes, sir. 

Mr. Kennedy. And the furniture that was provided, the home 
furniture, rugs and couches, et cetera, were sent to the homes of 
Allen Dorfman and Rose Dorfman ? 

Mrs. Lucas. Yes, sir. 

The Chairman. Is there anything further ? 

If not, thank you veiy much. 

The Chair will announce that when we resume tomorrow^ at 10 
o'clock in the morning, the committee will meet in room 3302 of the 
New Senate Office Building, Those of you interested may attend in 
that room. That is room 3302. Some other committee will occupy 
this room in the morning. We will go into some new quarters and 
ti-y out the acoustics over in that building. 

With that, we will recess until 10 o'clock in the morning. 

(Whereupon, at 4:50 p.m., the committee recessed to reconvene at 
10 a.m., Thursday, Januaiy 29, 1059, in room 3302, New Senate Of- 
fice Building.) 

(Members of the select committee present at the taking of the re- 
cess were Senators McClellan and Ervin.) 



INVESTIGATION OF IMPROPER ACTIVITIES IN THE 
LABOR OR MANAGEMENT FIELD 



THURSDAY, JANUARY 29, 1959 

U.S. Senate, 
Select Committee on Improper Activities 

IN THE Labor or MxVnagement Field, 

Washington, D.C. 

The select committee met at 10 a.m., pursuant to recess, in room 
3302, New Senate Office Building, Senator Jolm L. McClellan (chair- 
man of the select committee) presiding. 

Present: Senator Jolm L. McClellan, Democrat, Arkansas; Senator 
Sam J. Ervin, Jr., Democrat, North Carolina. 

Also present : Robert F. Kennedy, chief counsel ; Pierre E. G. Salin- 
ger, investigator; Martin S. Ulilmann, investigator; John P. Findlay, 
investigator; James J. P. McShane, investigator; Richard G. Sin- 
clair, investigator; Ruth Young Watt, chief clerk." 

The Chairman. The committee will be in order. 

(Members of the select committee present at convening of session: 
Senators McClellan and Ervin.) 

The Chairman. Call your first witness. 

Mr. Kennedy. Mr. Chairman, over the period of the past day and 
a half, we have been developing a number of points that we wish 
to go into further today. 

There are four major points we have gone into. The first which 
we have established is that there was collusion in the awarding of the 
insurance for the Central States Conference of Teamsters, and that is 
shown through the documents that have been placed in the record 
here. 

Second, there was collusion in the awarding of tlie contract of the 
Michigan Conference of Teamsters, which is shown from the docu- 
ments and, for instance, the fact that the bid was submitted to the 
Michigan Conference of Teamsters the day after the award was 
made, submitted from Allen Dorfman's company. 

Third, right from the beginning, there were excessive commissions 
paid for both the Central Conference of Teamsters and for the 
Michigan Conference of Teamsters, 

Fourth, there is the matter that climaxes all of this, that between 
1952 and 1954 the cost to tlie Michigan Conference of Teamsters and 
to the Central Conference of Teamstei-s was increased. 

The commissions to Allen Dorfman were increased and tlie benefits 
to the members of tlie Central Conference of Teamsters and the Michi- 
gan Conference of Teamsters were decreased on three separate occa- 
sions. 

16081 



16082 IMPROPER ACTIVITIES IN THE LABOR FIELD 

All of these matters were handled with the help and assistance and 
direction of Mr. James Hoffa. 

When we had our witnesses at the beginnmir, we developed tlie 
fact that this contract for the Central Conference of Teamsters was 
orio-hially awarded through the ett'orts and the friendship that ex- 
iste'cl between Mr. Paul l)orfman and Mr. James R. Hofifa. Now, 
Mr. Chairman, what I would like to do today is to call hnn as a 
witness, but prior to so doing that I would like to call a staff member 
who made an investigation of Paul Dorfman, and Paul Dorfman's 
background, and place that information in the record. 

I would like to call Mr. James McShane. 

'The Chairman. Will you be sworn ? _c i • 

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. McShane. I do. 

TESTIMONY OF JAMES J. P. McSHANE 

The Chairman. State your name and your place of residence and 
your present employment. • i • at 

Mr McShane. My name is James McShane, and I reside m ^'e^ 
York' City and I am a staff member of this committee. 

Mr. Kennedy. How long have you been with the committee, Mr. 

McShane ? 

Mr. McShane. A little better than a year and a lialf. 

Mr. Kennedy. AAHiat were you doing prior to that ? . , , ^^ 

Mr. McShane. Prior to that time I was a detective witli the x\ew 

York City Police Department. , . .i at a- i n-, 

Mr. Kennedy. For how long did you work for the ^ew \ork City 
Police Department? 

Mr. McShane. Approximately 21 years. • -^i ^i 

Mr. Kennedy. Did you receive some avrards for services with the 
New York Police Department ? 
Mr. McShane. I did, sir. 

Mr. Kennedy. AMiat were those awards ? . 

Mr McShane. I was cited for bravery 14 times. I have received 
the New York City Police De]^artment Medal of Honor. 

Mr Kennedy. Is tliat the highest award that can be awarded i 
Mr. McShane. That is the highest possible award that any living 
member can receive, sir. . . 

Mr Kennedy. Now, Mr. McShane, since coming with this commit- 
tee, have you devoted some time working on the background of Mr. 
Paul Dorfman ? 

Mr. McShane. I have, sir. .. ., . 1 1 

Mr Kennedy. And do you have some information that would sum- 
marize your investigation, as well as the investigations that have been 
conducted by other Government departments? 

Mr. McShane. Yes, sir; 1 have. „ . , ... . 

Mr. Kennedy. Would you give that information to the committee? 

Mr! McShane. According to our investigation, :Mr. Kennedy, Mr. 

Paul Dorfman is a major figure in the Chicago underworld. He is 

an associate of most of the leading gangsters in the Chicago area. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16083 

TTo is tlie contact man between dishonest union leaders and members 
of the ChicajTo underworld. 

]VIr. Dorfman is 5(5 years. He is tlie former secretaiy-treasurer 
of local 20467, AFL Waste Material Handlers ITnion in Chicago. 
He was ousted from that job by the AFL-CIO in late 1957. As to 
i\Ir. Dorfman's criminal backirround, it does not appear that he has 
ever been arrested for any crime. 

Mr. Kexxedy. Do you mean convicted of any crime? 

Mr. McShaxe. I am sorry; convicted. However, he was arrested 
in li)'2S in connection with ))anots in the 13th ]:)recinct of the old 2-4th 
ward in favor of the Ee]:)iiblican State's Attorney Crow. No disposi- 
tion of this charo-e can be found. 

In 1942 he was charged with mayhem in connection with the beat- 
ing of the executive secretary of the Waste Materials Dealers xVsso- 
ciation. He sulisequenth' was freed on this charge. 

Now the foundei- of local 204B7, one Leon R. Cook, was shot and 
killed in Chicago, 111., on December 8, 1939. Following this murder, 
Mr. Dorfman appeared on the scene and became secretarj'-treasurer 
of the union. 

Mr. Kexxedy. Would it appear from your investigation that he 
merely took over the union immediately after the killing of Mr. 
Cook? 

Mr. McShaxe. It would appear that way, sir. 

Mr. Kexxedy. What about Mr. Dorfman's criminal and other asso- 
ciates in Chicago? 

Mr. McShaxe. Well, of Mr. Dorfman's criminal and other asso- 
ciates, there is one Anthony "Tony" Accardo, known as the head of the 
Chicago mob since the death of Al C^apone. Another is ]Mr. Abra- 
liam Teitelbaum, former attorney for the Capone mob. Another is 
Abner "Longy" Zwillman, one of the top figures in the American 
underworld, who heads the rackets in the State of New Jersey. 

Telephone calls have been traced indicating that a New Jersey 
attorney by the name of Harold Krieger called Longy Zwillman 
at a summer camp owned by Mv. Dorfman in Wisconsin. 

Now, there is a Sol Cilento, a former oflicial of the Distilleiy 
Workers LTnion, who was a subordinate of Abner "Longy" Zwillman. 
There is Mr. Claude Maddox, alias "Screwy" Moore, a Chicago 
racketeer and hoodlum connected with the Hotel and Restaurant 
Workers Union. 

Now, the St. Valentine's Day massacre was plamied in Mr. Mad- 
dox's bar in February of 1929. 

Now, there is Mr. Jolm Dioguardi, alias Johnny Dio, a notorious 
New York gangster in the garment district, and Mr. Dio at the present 
time is in Sing Sing- with another Teamster otHcial for extortion. 
Mr. Dio, I might add, has appeared before this committee. 

Then there is Harry "Chink" Meltzer, a notorious ^Michigan hood- 
lum who was arrested in Chicago for extradition to ^Michigan on 
charges of placing explosives with intent to destroy. 

Mr. Kexxedy. He received a 15- to 25-year sentence? 

Mr. McShaxe. He is currently serving that in Jackson State orison 
in Michigan. When he was arrested he placed a call to Mr. Dorfman 
and told him he was in need of funds and, according to the police 
officers who accompanied him, we went to a West Side Chicago bar 



160S4 IMPROPER ACTIVITIES IN THE LABOR FIELD 

where he found Dorfman had left $25 for him. Mehzer was report- 
erly very angry at the time, and he commented to the officers that 
Dorfman owed him very much more than that. 

There is a Ruth Brougher and she has reported that Robert Barney 
Baker sent her to see Paul Dorfman about the disposition of some 
jewelry she had in her possession. She said subsequently that she 
met Dorfman in Chicago in connection with this matter. Although 
nothing came of the meeting, Dorfman gave her his unlisted tele- 
phone number and told her to call him if she ever needed help. 

Mr. Kennedy. She is the lady who appeared before this com- 
mittee and testified and is now serving a sentence in Florida in con- 
nection with the murder of her boy friend ? 

Mr. McShane. That is true. 

Mr. Kennedy. Now, you talked about his connection with some 
of the union officials. Have we f ovmd that he has been responsible for 
the setting up and establishment of certain locals throughout the 
country ? 

Mr. McSiiANE. That is true ; he has, sir. 

Mr. Kennedy. Would you give us some information on that? 

Mr. McShane. Well, there has been testimony before the com- 
mittee here that clearly indicates that Paul Dorfman was responsible 
in securing the charter of Local 102 of the United Auto Workei*s 
Union, AFL, for Johnny Dio. Sam Zakman, in whose name the 
charter was originally issued, was taken to the Hampshire House in 
New York City and introduced to Paul Dorfman by Sam Berger, 
the manager of Local 102 of the International Ladies' Garment 
Workers' Union. Berger told Dorfman that this is a young man he 
would lilvc to see get a charter. 

Paul Dorfman's name appears on the original charter of local 102, 
and following the meeting with Dorfman, Berger flew to Milwaukee 
with Zakman and obtained the charter which, within a matter of 
months, was turned over to Johnny Dio. 

Paul Dorfman was instrumental in securing a charter in the 
Teamsters Union for Abe Gordon, who now heads local 805 of the 
Teamsters in New York City. Mr. Gordon is a close associate of 
Dorfman, and James R. Hofi'a, and Johnny Dio. 

It is significant that Gordon's initial organizing activities were in 
the vending machine industry in New York and New Jersey, a sub- 
stantial portion of which was controlled by "Longy" Zwillman. 

Mr. Kennedy. During the hearings that we held on Johnny Dio- 
guardi, we traced some telephone calls to Johnny Dio at the head- 
quarters of Abe Gordon ; did we not ? 

Mr. McShane. We did. 

Mr. Kennedy. And the office of Abe Gordon in local 805 and it 
was Mr. Abe Gordon that was down here for a considerable amount 
of time consulting with Jimmy Hoffa during the hearings that we 
held last year; isn't that correct? 

Mr. McShane. That is true; it is, sir. 

Now Mr. Dorfman is reported to have been instnnnental in secur- 
ing a Teamsters Union charter in Minneapolis for James Azzone, who 
was convicted of grand larceny in 1938 and sentenced to the State 
reformatory at St. Cloud, Minn. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16085 

Azzone was active in this Teamstei-s Union Local 688 with Gerald 
Connelly, now servin*^ a Federal penitentiaiy sentence at the U.S. 
penitientary at Terre Haute, Ind. 

Paul Dorfman is responsible for obtaining of a charter for Hari-y 
Karsh, in St. Louis, ISIo., who is the present secretary-treasurer of the 
Carnival Workers Local 447 in St. Louis. Incidentally, Mr, Kai-sh 
has also appeared before this committee. 

As to some of his business associates, he was a partner with Mr. 
James Hott'a in the operation of a summer camp in Wisconsin. He 
is a partner with Mr. Hoffa in the Nortliwestern Oil Co. in North 
Dakota. 

He is a partner, or rather was a partner, v.ith Mr. Ted Sludman and 
Ross Miller in the man:ioement of a heavyweight fighter, known as 
Billy Nolan. 

Mr. Shulman at that time was the executive secretary of the Waste 
Materials Dealers Association A\ith whom Mr. Dorfman would 
negotiate for contracts. 

]Mr. Kexxedy. That is S-h-u-1-m-a-n ? 

Mr. ]McShaxe. That is correct. 

And Mr. Dorfman's son, Allen Dorfman, is a ])artner with Mr. 
Shulman in the Sheridan Lien Co., set u[) for the purpose of purchas- 
ing property seized for the nonpayment of taxes. 

Now, a bit or two more about Mr. Dorfman, if I may say, Mr. 
Kennedy : ]Mr. Dorfman is a former prizefighter Avho fought under the 
name of "Red" Dorfman. He was managed by Sam Pian, who also 
managed Barney Ross, the former welterweight and middleweight 
champion. 

In 19r)5 and 1956, Mr. Paul Dorfman was a guest at the Hotel 
Riviera in Las Vegas, Nev. A part owner of this hotel is the afore- 
mentioned Ross Miller. The hotel ledger sheets show that Dorfman 
was not charged for his rooms. 

In 1956, yh\ Dorfman made a trip to Honolulu and stayed at the 
Royal Hawaiian Hotel, and a check of the Union Insurance Agency 
of Illinois, dated May 4, 1956, in the amount of $912.41 was used in 
the payment of Mr. Dorfman 's room. 

Rose Dorfman also received a check from the Union Insurance 
Agency, and this in the amount of $2,.S00, for partial reimbursement 
of the Honolulu trip. 

Mr. Kexxedy. That summarizes the situation as far as Paul Dorf- 
man is concerned? 

Mr. McSiiANE. Up to the present time, sir. 

Mr. IvEX'XEDY. But you gave some examples of some of the criminal 
associates in the Chicago area, and you have foimd him to be a key 
figure with the underworld in that area ? 

Mr. McShaxe. Yes, sir; I have. 

Mr. Kexxedy. I think that is all. 

The CiiAiRMAX. Call the next witness. 

Mr. Kexxedy. Mr. Paul Dorfman. 

The Chairmax. 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. Paul Dorfman. I do. 

36751 — 59 — pt. 43 10 



16086 IMPROPER ACTIVITIES IN THE LABOR FIELD 

TESTIMONY OF PAUL J. DORFMAN, ACCOMPANIED BY COUNSEL, 

STANFORD CLINTON 

The Chairman. Mr. Witness, state your name, your place of resi- 
dence, and your business or occupation. 

Mr. Paul Dorfman. My name is Paul Dorfman. I reside at 5801 
Sheridan Road, Chicago. 

The Chairman. What is your business or occupation, Mr. Dorf- 
man ? 

Mr. Paul Dorfman. Unemployed now. 

The Chairman. Unemployed. For what period of time have you 
been unemployed, Mr. Dorfman? 

(The witness conferred with his counsel.) 

The Chairman. First I will ask you: Do you have counsel present? 

Mr. Paul Dorfman. Yes, sir. 

The Chairman. Counsel, will you identify yourself? 

Mr. Clinton. My name is Stanford Clinton. I am a member 
of the bar of the State of Illinois, and my address is 134 Xorth 
LaSalle Street, Chicago. 

The Chairman. Thank you very much. 

Ail light, Mr. Dorfman, I believe you said you were presently 
unemployed. How long have you been unemployed? 

Mr. Paul Dorfman. I think it is since December of 1957. 

The Chairman. Since December of 1957? 

Mr. Paul Dorfman. I wouldn't say for sure. I don't remember. 
Since I have been out of the local union. 

The Chairman. December 1957; that is your best recollection at 
the moment? 

]Mr. Paul Dorfman. Well, that is — since I have been out of the 
local union. 

The Chairman. Which, as you recall, was some time in December 
1957? 

Mr. Paul Dorfman. That is correct, sir. I think so. 

The Chairman. You say since you have been out of the employment 
of the local union. What union was that? What was the union you 
referred to ? 

Mr. Paul Dorfman. Waste Material Handlers Union. 

The Chairman. The what? 

Mr. Paul Dorfman. Waste Material Handlers Union, local 

The Chairman. Waste Material Handlers ITnion, local wliat ? 

Mr. Paul Dorfman. No. 20467. 

The Chairman. What was your position of employment with that 
union ? 

(The witness conferred with his counsel.) 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

The Chairman. Was it a legitimate, honest service that you were 
rendering to the union ? 

(The witness conferred with liis counsel.) 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

The Chairman. As I understand you, you were emploved by the 
union. Now you decline to state in what capacity you wei-e em]iloved 



IIVIPROPER ACTIVITIES IN THE LABOR FIELD 16087 

by the union on the ground that an answer thereto might incriminate 
you. 

May I ask you: Do you honestly believe that if you gave a truthful 
answer to the'question, "What wei'e you employed by the imion to do ?" 
or "What position did you hold with this union, local 204()7?" do you 
honestly believe that a truthful answer to that question might tend to 
incriminate you? 

Mr. Paul Dorfman. Yes, sir. 

The Chairman. Then I ask you the question if the employment was 
for legitimate purposes, and 1 am speaking legally, in other words, 
was it for services that were legal under the law that you were to 
perform, were they within the law, legal and proper? That is the 
question. 

(The witness conferred with his counsel.) 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

The Chairman. I would think if it were legal, the services that you 
had performed, and were not in violation of law, that there could 
hardly be any incrimination of you by stating whether they were or 
were not, if they weren't. 

If you state now under oath that a truthful answer to that question 
might tend to incriminate you 

Mr. Paul Dorfmax. I do. 

The Chairman. All right, Mr. Kennedy, you may proceed to ask 
him about the things at issue. 

Mr. Kennedy. ]Mr. Dorfman, you heard the testimony of Mr. Mc- 
Shane regarding your background. I am wondering if there is any 
statement which he made which is incorrect ? 

(The witness conferred w^ithhis counsel.) 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. Kennedy. You are closely associated, are you not, with some 
of the leading members of the underworld of C^hicago ? 

]Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. Kennedy. Isn't it correct that Mr. Hotf a never knew Mr. Allen 
Dorfman prior to 1949, and that his association had been with you, 
Mr. Paul Dorfman? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

Mr. Kennedy. Mr. Allen Dorfman is your son, is he not? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

The Chairman. You don't mean to imply you have a son that you 
can't identify and acknowledge without possible self-incrimination? 
You don't mean to do that, do you ? 

(The witness conferred with his counsel.) 

Mr. Paul Dorfman. Yes, I have a son. 

The Chairman. All right. That is carrying it to the extreme. It 
is superridiculous, isn't it ? Don't you agree wnth me on that ? I think 
your silence and giggle is acquiescence with the Chair. 

Mr. Kennedy. Air. Allen Dorfman is your son? 

Mr. Paul Dorfman. Yes, sir. 



16088 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. The reason for Mr. Hoffa granting this very lucra- 
tive contract to this insurance company, to Allen JJorfman, was in 
order to enable him to get a foothold in Chicago with the Teamsters 
Union, was it not, Mr, Dorf man '{ 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

Mr. IvENNEDY. And wasn't that foothold to be obtained through 
his association with you, and tlie quid pro quo, for you allowing him 
and bringing him into Chicago, the quid pro quo was the granting 
of this contract on the insurance ? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. IvENNEDY. Isn't it the reason that you had so much power and 
authority and still do in Chicago, because of your close association 
with the members of the underworld in that city ? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. IvENNEDY. Isn't it true that prior to 1950 Mr. Hoffa had no 
following of any kind in Chicago, and that changed after he granted 
the insurance to Allen Dorfman ? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

Mr. IvENNEDY. And wasn't it arranged also that Allen Dorfman 
would get 50 percent of the profits and the other 50 percent of the 
profits would go to you, through your wife. Rose Dorfman? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer miglit tend to incriminate me. 

Mr. Kennedy. Wasn't this the arrangement and deal that was made 
with Mr. Holfa which ultimately brought about ISIr. Hoffa betraying 
the membership of the Teamsters Union by allowing an increase in 
commissions to your wife and to Mr. Allen Dorfman at the same time 
decreasing the benefits to the Teamster Union members ? 

Mr. Paul Dorfman. I respectfidly decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. Ivennedy. In addition to that, Mr. Paul Dorfman, isn't it a fact 
that on occasion you have paid bills of j\lr. James Riddle Hoft'a ? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. Kennedy. Isn't it a fact that during the period of the past 12 
months that you have supplied cash on behalf of Mr. James Riddle 
Hoffa? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to inci'iminate me. 

Mr. Kennedy. And isn't it a fact also that Mr. Allen Dorfman has 
supplied cash to pay the bills, some of the bills, of Mr. James Hoff'a? 

Mr. PAUii Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. Kennedy. Wasn't it a double situation : First, that you enabled 
him to move into Chicago with the control of the Teamsters in that 
area; and secondly, from the large accumulations of money that you 
were going to acquire through this Teamster contract, that you would 
on occasion pay his bills and make investments for him ? 

Mr. Paitl Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might, tend to incriminate me. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16089 

Mr. Kennedy. Isn't it correct that you, yourself, as a union official, 
were never interested in the members of your union ? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer mio:ht tend to incriminate me. 

Mr. Kennedy. Isn't it correct that you never attempted to enforce 
the contract that existed between your union and the Waste Trade 
Industry of Chicago ? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

Mr. Kennedy. Isn't it correct that you also betrayed your mem- 
bership by entering into collusive deals with the head of the Waste 
Trade Industry of Chicago, Mr. Shulman ? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

Mr. Kennedy. That the only interest that you ever had in these 
matters was in the income that you could acquire from your relation- 
ship with the union and your relationship with Mr. Hoffa? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. Kennedy. Weren't you at the trial in New York, and also here 
in Washington, D.C., with Mr. Hoffa continuously, and weren't you in 
a hotel room in Chicago when Mr. Hoffa and several of his colleagues 
were selecting those officials who wold run on his slate in Miami, Fla. ? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

Mr. Kennedy. And isn't this just one further example, but prob- 
ably the most serious, of Mr. Hoffa's tieup with the underworld in 
what ultimately leads to a betrayal of the union membership? 

Mr. Paul Dorfman. I respectfully decline to answer because I hon- 
estly believe my answer might tend to incriminate me. 

The Chairman. Senator Ervin ? 

Senator Ervin. Can you give this committee any satisfactory and 
honest explanation of why it was that the officials of the Teamsters 
Union who have been empowered to obtain insurance in behalf of 
the members of the Teamsters Union gave contracts to Allen Dorf- 
man which resulted in the gift, virtually the gift, of hundreds of 
thousands of dollai's to Allen Dorfman and your wife over and above 
what those same officials of the Teamsters could obtain the same serv- 
ices for from other companies ? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

Senator Ervin. Mr. Dorfman, don't you think it is a tragic day in 
America when you and scores upon scores of other labor leaders who 
have been permitted to exercise authority over other men under the 
laws of this country, when they are asked about their activities as 
union leadrs come here and, one after another, take the fifth amend- 
ment ? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answer might tend to incriminate me. 

Senator Er\t:n. Let me ask you this question : Don't you think that 
Congress, as far as interstate matters are concerned, and the State of 
Illinois and the other States of this Union, ought to take some kind of 
provision to pass some laws that would require such conduct on the 



16090 IMPROPER ACTIVITIES IN THE LABOR FIELD 

part of labor leaders that when they are callied upon to account for 
their official actions that they don't have to hide behind the fifth 
amendment ? 

Mr. Paul Dorfman. I respectfully decline to answer because I 
honestly believe my answ^er might tend to incriminate me. 

Senator Ervin. That is all, Mr. Chairman. 

The Chairman. The witness will probably be recalled later. You 
may stand aside for the present. 

Call the next witness. 

Mr. Kennedy. Mr. Daniel Healy. 

The Chairman. Be sworn, please. 

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. Healt. I do. 

TESTIMONY OP DANIEL J. HEALY 

The Chairman. Mr. Healy, give your name, your place of resi- 
dence, and also your present business or occupation. 

Mr. Healy. Daniel J. Healy, regional director for the AFL-CIO 
region 14, comprising the States of Illinois and Iowa, residing in 
Skokie, 111. 

The Chairman. You waive counsel, do you, INIr. Healy ? 

Mr. Healy. That is correct. 

The Chairman, I didn't quite understand, and if you would, repeat 
for my information, your present occupation. 

Mr. Healy. Regional director of the AFI^CIO. 

The Chairman. Very well. Proceed. 

Mr. Kennedy. Mr. Chairman, this witness is being called to de- 
velop the facts showing the lack of interest that Mr. Paul Dorfman 
has had in the imion members of his local, what the situation was 
when the AFL-CIO took over this local, and the difficulty and prob- 
lems that the AFI^CIO has had since that time, and the collusive 
arrangements that have existed among the Teamsters Union, Mr. 
Dorfman, and the Waste Trade Industry of Chicago. 

Mr. Healy, would you tell the committee when you fii'st became 
associated with the Waste Material Handlers Local Union in Chicago? 

Mr. Healy. Originally, President Meany put the local under 
trusteeship on December 27, 1956. The then regional director for the 
AFL-CIO, Eugene Moats, who has since been promoted to assistant 
to President Meany, was appointed to trustee. 

I w^as transferred out of New Elngland in July 1957 as regional 
director, replacing Mr. Moats, and as part of my duties I was ap- 
pointed on July 'H, 1957, by President Meany, as the trustee of 
directly affiliated local union 20467. 

Mr. Kennedy. How long liad you been in the labor movement? 

Mr. Healy. Since 1940. 

Mr. Kennedy. What positions had yon held ^ 

Mr. Healy. I have been a general organizer for the AFL since 
1943. I have been New England regional director for the AFL 
since 1955. I was assistant rejrional director for the AFI^CIO in 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16091 

New En<T:land for Deconiher 5, 1955, until my appoiiitnient us regional 
director for the 14th region. 

Mr. Kp^nnedy. AVould you follow through with the clu'onology, 
please ? 

Mr. Healy. On taking over the the trusteeship of the local union, 
my predecessor, Mr. INIoats, at that time discovered that the funds 
of the local union and the funds of the health and welfare fund, 
were maintained in a checking account in a bank in the city of Chi- 
cago. The funds in the health and welfare fund Avere not invested 
as per the trust agreement, and they were deposited, as I said before^ 
in a checking account, requiring one signature, namely that of Paul 
Dorfman. 

]Mr. Shulman, who was the association trustee, did not at that time, 
sign any of the checks. Mr. Moats had the funds deposited in a 
savings account requiring two signatures on all moneys belonging to 
the health and welfare fund. 

Mr. Kennedy. Was this money that had been placed in the bank 
drawing any interest ? 

Mr. Healy. Xo, that was not drawing interest. 

Mr. Kennedy. Was it drawing interest at all? 

Mr. Healy. It was in a checking account. 

Mr. Kennedy. What bank was that ? 

Mr. Healy. The name of the bank slips me at the moment. 

Mr. Kennedy. The Exchange National Bank? 

Mr. Healy'. That is correct. 

Mr. Kennedy. Is that the Exchange National Bank that is owned 
or operated by George Sax ? 

Mr. Healy. To the best of my knowledge ; yes. 

Mr. Kennedy. And George Sax also operates the Saxony Hotel 
in Miami ? 

Mr. Healy. That I wouldn't have any knowledge of. 

Mr. Kennedy. Mr. Chairman, we will have further information 
with respect to the Saxony Hotel, George Sax, and Paul Dorfman. 

But the money was deposited in this bank account without paying 
any interest? 

^Ir. Healy. That is correct. 

The Chairman. Give us some idea of the amount of funds, roughly. 

Mr. Healy. Roughly $150,000 was deposited in the account of the 
health and welfare fund. 

The Chairman. Just in an open checking account subject to the 
signature of Mr. Dorfman ? 

Mr. Healy. That is correct, 

Mr. Kennedy. Was that in violation also of the trust agreement? 

Mr. Healy. Well, the truth agreement provided that the funds were 
to be invested. 

We also discovered — when I say "we," I mean the AFL-CIO — dis- 
covered that the insurance contract on which we were currently pay- 
ing 1.5 of the total earnings, contained a clause which allowed the 
carrier at any time to raise the premiums to 2 percent. We are cur- 
rently paying 1.8. 

After taking over the local union in July, we had certain recom- 
mendations which we put into eft'ect. We had to wait until Mr. 
Dorfman had full recourse, under the constitution. 



16092 IMPROPER ACTIVITIES IN THE LABOR FIELD 

His case was reviewed before tlie executive council in the AFL-CIO 
at their meeting in Chicago in 1957, and again before the appeals 
committee at the national convention, and again before the full con- 
vention at Atlantic City. 

In all cases, President Meany's position was upheld. 

Mr. Kennedy. Did you find also misuse of union funds, that IMr. 
Dorfman was paying some of his personal bills, garage bills, et 
cetera ? 

Mr. Healy. My predecessor, Mr. Moats, had an audit of the ac- 
count, and the auditor's report shows that certain personal bills were 
paid out of the fund. 

Mr. Ivennedy. That is, out of the welfare fund ? 

Mr. Healy. That is correct. 

Mr. Ivennedy. Did you also find that Mr. Paul Dorfman was being 
paid both out of the welfare fund and also by the union ? 

Mr. Healy. For a period of time he was receiving a salary from 
the welfare fund and also receiving a salary from the general fund of 
the local union. 

However, sometime in 1956 the total salary was paid out of the 
local fund, not out of the health and welfare. That move was made, 
I think, around December of 1956, prior to the local being placed 
under trusteeship. 

Mr. Kennedy. Is that also a violation of regulations, to be paid out 
of that? 

Mr. Healy. That is a violation of the ethical practices code as 
adopted by the AFL initially at its convention in Miami in 1954, and 
again adopted at the national convention, or the founding convention 
of the AFD-CIO in New York in 1955. 

Mr. Kennedy. Would you continue ? 

Mr. Healy. After the convention upheld Mr. Meany's position, 
there were certain changes that we incorporated. We established an 
office setup whereby the office personnel — where the responsibilities 
were divided, with one office employee exclusively handling the affairs 
of the health and welfare fund and paying out of it, and the other 
handling the affairs of the local union. 

We established an educational course at the University of Chicago 
for stewards, and also a leadership course for the officers of the local 
union. 

We took an individual out of the waste trade industry and put him 
on the road, so to speak, as a chief steward to police the contract on a 
day-to-day basis. He is currently doing it. 

It is sometime in — I don't recall the exact date that he went on. 
On or about February of 1958 — February 27, to be exact — we notified 
the Waste Trade Association of a desire to amend and modify the 
current working agreement. 

Prior to that, we liave had one arbitration case involving — actually, 
two cases — one involving wa^e rates and the other involving contract 
interpretation as it related to holiday pay. 

The contract in existence at that time provided for six paid holidays, 
altliough there were no strings attached ; in other words, no ]ienalty 
on the employee for working tlie day before or daj'' after. When we 
went to police the action of that agreement, we were informed by 
various members of the association that even though the contract 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16093 

clearly specified the employee did not have to work the day before and 
the day after, there was a mutual arranfrement between the associa- 
tion and Mr. Dorfman to the effect that in some cases — and I think the 
employers in this active case took advantage of Mr. Dorfmairs situa- 
tion — iind they said that the employee had to work as long as a month 
before and a month after before being eligible for holiday pay. We 
arbitrated the situation. 

We lost the case involving the wage issue, and we won the case 
involving the holiday pay. 

Mr. Kexnedy. This was a situation where the contract stipulated 
tliat tliey had six paid holidays, and yet the members of the associa- 
tion, the employers, said that they had a private agreement with Mr. 
Paul Dorfman, and the terms of the contract were not to be enforced ? 

Mr. Healt. That is right. As part of their case, they submitted an 
exhibit signed by some 50 to 60 members of the association, stating that 
they had a mutual arrangement, or a mutual understanding, with ISIr. 
Dorfman, regarding the working the day before and the day after the 
holiday before being eligible for holiday pay. 

Mr. Kennedy. So although the contract stipulated one thing, be- 
cause of this arrangement they had been following a different practice ? 

Mr. Healy. That is right. 

Mr. Kennedy. The contract was not being enforced ? 

Mr. Healy. That is correct. On February 27, 1958, as I said be- 
fore, we notified the association that we wished to amend, modify, and 
renew the agreement. We went into negotiation some 30 days later, 
and right along around that time Mr. Paul Dorfman conducted an 
organizational campaign. Our first knowledge was at B. Cohn & 
Sons, who is not a member of the association, where Mr. Dorfman 
went in with the knowledge of the employer and organized or signed 
up the employees on cards for Local 743 of the International Brother- 
hood of Teamsters. 

At that time it was called to our attention that the authorization 
cards carried the designation of AFL-CIO after the local, and as a 
result of that unfair labor practice, charges were filed wliich were dis- 
missed by the Board after investigation, mainly because the contract 
was an independent contract outside of the association and as such 
the expiration date was September 1, so that the move on Mr. Dorf- 
man's part would be premature as far as that agreement was 
concerned. 

Mr. Kennedy. So what happened was that Mr. Dorfman had been 
expelled from the AFL-CIO, and you had found, or learned, that 
there had been misuse of union funds and a violation of the trust 
agreement regarding the welfare fund, and the contract that had been 
written with the association had not been enforced. After this in- 
formation you started to enter into negotiations to sign a contract 
with the Waste Trade Industiy of Chicago, and you found the same 
Paul Dorfman was then going to work for the Teamsters? 

Mr. Healy. That is correct. 

Mr. Kennedy. He was going to work for local 743 of the 
Teamsters ? 

Mr. Healy. That is correct. 

Mr. Kennedy. Trying to sign up these association membei-s? 

Mr. Healy. The employees of the association, yes. 



16094 IMPROPER ACTIVITIES IN THE LABOR FIELD 

I think the next incident was at Standard Re-Wasli Co. where 
again Mr. Dorman signed up the employees on authorization cards 
which carried the designation of 743, International Brotlierhood of 
Teamsters, AFI^CIO. We raised tlie question with the Board on 
the authenticity of the cards mainly because the Teamsters were no 
longer a part of the AFD-CIO at that time, and as a result the local 
union, 743, withdrew their petition. However, the employer filed 
with the Board an RN petition, which is one requesting an election 
among the employees, and the Board processed the petition and the 
Teamsters w^ere successful in defeating the directly affiliated local 
union by some 2 to 1, as I recall, and I don't have the exact comit. 

Mr. Kennedy. Did you find evidence that the employers were 
helping local 743 of the Teamsters ? 

Mr. Healy. Well, I wouldn't say they were helping 743. 

Mr. Kennedy. They were helping Paul Dorf man ? 

Mr. Healy. They were helping Paul Dorfman. 

Mr. Kennedy. And he was representing the union ? 

Mr. Healy. I assume so. 

Mr. Kennedy. Well, you know he was helping 743 or working for 
743 ? 

Mr. Healy. He was working for 743. 

Mr. Kennedy. And did you find evidence that the employers were 
assisting Paul Dorfman in signing up these employees ? 

Mr. Healy. He had free access to the plants, and after the contract 
expired on April 31, we went for a period of time actually from April 
30 until somewhere around November 6 or the middle of November 
before we finally concluded an agreement with the association. Until 
all of that period of time, Mr. Dorfman in many cases with the as- 
sistance of the employers harassed us from an organizational stand- 
point. We got down to June of 1958 where we thought we had a 
meeting of the minds on the agreement, and we presented it to the 
membership on June 12 of 1958, and it w^as ratified by the membership. 
The association were meeting the same night, and their attorney, Mr. 
Goodman, had requested that w^e at least make our position known 
as far as the local union was concerned. 

Mr. Kennedy. Is that Mr. Phil Goodman? 

Mr. Healy. That is correct. 

Mr. Kennedy. He was representing the association? 

Mr. PIealy. That is correct, during the negotiations. 

Mr. Kennedy. We have already had testimony in connection with 
him, Mr. Chairman, as representing the insurance company, and 
representing Allen Dorfman, and he has also gone into business deals 
with James R. Hoffa. 

Mr, Healy. At the meeting on June 12, the members of the associa- 
tion saw fit not to go along with their negotiating committee and 
did not ratify the agreement from the employers" standpoint and 
withdi'ew their offers and so notified us. We actually went from 
that period of time up until the early part of September when we 
had occasion to contact the new attorney for the association, Mr. 
Dave Silbert, regarding a contract with W. B. Cohn & Sons, not a 
member of the association. At tliat time further discussion was re- 
sumed on the contract and Mi-. Silbert secured the signatures of the 
various members of the association empowering him to negotiate an 
afjreement for them. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16095 

We finally concluded an agreement, as I said before, somewhere 
around the middle of November. 

Mr. Kennedy. Is it a j^ood a<;reement ? 

Mr. Healy. Personally, it is not as <rood an a<rreement as 1 would 
like to have seen in there. I say this: We are not proud of it, and 
we nefjotiated at a time when we had an economic recession as far 
as the waste industry was concerned, plus the fact that we had this 
continual harassment from Mr. Dorfman that certainly was not the 
best atmosphere to netjotiate a decent agreement in. 

Mr. Kennedy. If you had not conceded on some of the points, do 
vou realize that the association would have signed up with Paul 
Dorfman and 748? 

Mr. PIealy. Well, he was still conducting his organizational cam- 
paign, plus the fact that the association some time in June had filed an 
EN petition with the National Labor Relations Board requesting 
an election. 

Mr. Kennedy. Was that unusual for the association to file that? 

Mr. Healy. It is unusual for an employer who has had contractual 
relationship with an organization for a long period of time to file 
what is known as an RN petition. 

Mr. Kennedy. What do you think their reason and purpose for 
doing that was? 

Mr. Healy. I would assume that Mr. Dorfman had been unsuc- 
cessful in securing the required number of authorization cards to tile 
a prime petition. In this way, he would have the opportunity, or the 
employees would have an election, and the Board would order an 
election on the basis of the petition filed by the employer. 

Mr. Kennedy. This showed once again the relationship that 
existed between the association members and Mr. Paul Dorfman? 

Mr. Healy. That is correct. 

Mr. Kennedy. Now, did you realize or feel that if you did not sign, 
a contract and give in on some of these points, that you would have had 
even more difficulty in the contract that might have been signed? 

Mr. Healy. We had gone some 6 months, Mr. Kennedy, without a 
contract, and no health and welfare was being deducted and no dues 
were being deducted by the members of the association and we had no 
grievance pi'ocedure and our stewards were not recognized over that 
period of time because the association took the position that the con- 
tract expired on April 30, and therefore they had no obligation as far 
as collective bai-gaining was concerned or of recognizing our stewards 
or processing any grievances. Over that period of time I would say 
that the emj^loyees were used rather roughly by various members of 
the association. 

Mr. Kennedy. Tell me this: What was the situation as far as the 
local is concerned ? Was it run and controlled pretty much by Paul 
Dorfman prior to your coming in there? 

]\rr. Healy. Well, when my predecessor, Mr. Moats, took over, he 
discovered that the president of the union liad very, very seldom run 
a meeting and Mr. Dorfman always chaired the meetings. 

And the minutes of the meeting were taken by the office secretary 
rather than the recording secretaiy of the local union, which is rather 
unusual. 



16096 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. And when Mr. Dorfman was before the AFL-CIO 
ethical practices committee, didn't Mr. Shuhnan appear as a character 
witness for him ? 

Mr. Healy. I was not present at that hearing, but I understood 
he did. 

Mr. Kennedy. And also Mr. George Sax, who ran the bank, ap- 
peared as a witness ? 

Mr. Healy. The minutes show that they both appeared. 

Mr. Kennedy. Both of those gentlemen appeared ? 

Mr. Healy. That is right. 

Mr. Ivennedy. Had there been a negotiating coromittee for that 
local, to negotiate contracts with the association, or Mr. Paul Dorf- 
man? 

Mr. Healy. Prior to the trusteeship, it is our understanding, no. 

Mr. Kennedy. That Mr. Paul Dorfman had done it all ? 

Mr. Healy. That is correct. 

Mr. Kennedy. What about time and a half? Did you find out 
whether that provision had been enforced or whether the members 
were to receive time and a half ? 

Mr. Hjealy. During the negotiations, one of the stumbling blocks 
or one of the issues that was debated at some length was time and 
a half after 8 hours. Naturally, we took the position that something 
that was in the agreement for a long period of time was involved, 
and I couldn't see any reason why the negotiating committee for the 
association should object to it. It was something that had been in 
the agreement for some 8 or 10 years prior. One of the members of 
the association made the remark that it may have been in the contract 
but he didn't thinlv it was being paid. 

Mr. KJENNEDY. Did you find out for yourself, from talking to some 
of the employees, that they didn't receive it ? 

Mr. Healy. That we haven't been able to check into, and that 
would be a tremendous job. 

Mr. IvENNEDY. Did you find any employees that said they had not 
been paid time and a half ? 

Mr. Healy. We have had some grievances on the issue, and it is 
also on the scale where we have processed and we have collected them. 

Mr. Kennedy. What about grievances, had there been any proc- 
essing of grievances prior to your coming in there, that you could 
find? 

Mr, Healy. Well, to the best of our knowledge, Mr. Dorfman did 
process grievances on occasions. 

Mr. IvENNEDY. Was that a general procedure? 

Mr. Healy. As far as we can find out, yes, he processed grievances,, 
on behalf of the men. 

The Chairman. Are there any questions ? 

If not, call the next witness. 

Mr. Kennedy. Mr. Don Peters. 

The Chairman. Mr. l*eters, will you come around ? 

You do solemnly swear tliat 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. Peters. I do. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16097 

TESTIMONY OF DONALD PETERS, ACCOMPANIED BY COUNSEL, 
EDWARD J. CALIHAN, JR. 

The Chairman. State your name and your place of residence and 
your business or occupation, please. 

Mr. Peters. Donald Peters, residing in Illinois, president of the 
Warehouse and Mail Order Employees Union, Local 743, of the Inter- 
national Brotherhood of Teamsters, Chauileurs, Warehousemen and 
Helpers of America. 

The Chairman. Thank you very much. 

You have counsel, and will you identify yourself? 

Mr. Calihan. ]\Iy name is Edward J. Calihan, Jr., 105 West Adams, 
Chicago, 111., member of the bar of the State of Illinois. 

Mr. Kennedy. How long have you been associated with local 743, 
Mr. Peters? 

(The witness conferred with his counsel.) 

Mr. Peters. Since it was chartered in 1941. 

Mr. Kennedy. "V^^len did you become an officer? 

Mr. Peters. Since that time. 

Mr. Kennedy. You became an officer immediately ? 

Mr. Peters. Yes, sir. 

Mr. Kennedy. What had you done prior to that time ? 

(The witness conferred with his counsel.) 

Mr. Peters. I worked in a warehouse. 

Mr. Kennedy. Were you one of the original applicants for a 
charter ? 

Mr. Peters. Yes ; I believe I was. 

Mr. Kennedy. How many members of the union were there at that 
time? 

Mr. Peters. I wouldn't know for sure; it is around 500. 

Mr. Kennedy. How many are there now ? 

Mr. Peters. Fifteen thousand. 

Mr. Kennedy. What was your original position with the union? 

Mr. Peters. Trustee. 

Mr. Kennedy. Did you ultimately take another position, ultimately 
get another job? 

Mr. Peters. I am president of the union today. 

Mr. Kennedy. When did you become president ? 

Mr. Peters. In 1946. 

Mr. Kennedy. Was the union in trusteeship at all ? 

Mr. Peters. Never. 

]Mr. Kennedy. It never was. 

Mr. Peters. No, sir. 

Mr. Kennedy. You were just one of the three trustees? 

Mr. Peters. Yes, sir. 

Mr. Kennedy. Were you elected president originally ? 

Mr. Peters. Yes. 

Mr. Kennedy. Did you have any opposition ? 

Mr. Peters. No. 

Mr, Kennedy. Wlien did you last run for office ? 

Mr. Peters. In 1955 or 1956, and I am not sure. 

Mr. Kennedy. Did you have any opposition at that time ? 

Mr. Peters. No, sir. 



16098 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. Have any of the officers ever had any opposition? 
Mr. Peit^rs. Well, I was in service for 3 years, and I don't know if 
there Avas during that time. 

Mr. Kennedy. That you know of l 
Mr. Peters. Not that I know of. 

Mr. Kennedy. What is your salary, and what do you receive from 
the union now ? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

The Chairman. Is tliere anything about your salary, or your re- 
muneration from the union that is illegal ? 

]\Ir. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

The Chairman. If there is anything in your answer that would 
tend to incriminate you, there is bound to be something illegal or 
improper or something that reflects upon the transactions for you to 
represent the union or to be employed by the union. 

Do you want to leave the record that way, that there is something 
that might tend to incriminate you if the truth were known about it 
and if you answered the question truthfully ? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer may t-end to incriminate me. 

The Chairman. You do leave the answer that way, then. Is that 
correct ? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

The Chairman. Proceed, Mr. Kennedy, and this is another case of 
someone working in a position of trust and responsibility for union 
people, the people who pay the dues, and he can't give an accounting 
of his stewardship without self incrimination. 

Mr. Kennedy. We understand, Mr. Peters' income in 1958 was ap- 
proximately $27,300; in 1957 it was $21,950; in 1956, $19,170; in 1955, 
$15,950 ; and in 1954, $11,100. 
Is that correct, Mr. Peters ? 

Mr, Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Your salary has gone up more than double in a 4- 
year period, since 1954, is that correct? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. For clarification, do you mean his salary from the 
union, according to the information we have, has ranged from $11,000 
in 1953 and 1954, to $27,300 in 1 958 ? 
Mr. Kennedy. That is right. 

Senator Ervin. Which incidentally is in excess of that of a Member 
of the Senate who works about 14 hours a day, and I just would like 
to ask the witness what services he performs which entitle him to 
receive a salary in excess of that of a U.S. Senator who works, I 
think, most of us, very faithfully for our constituents, about 14 hours 
a day. 

Would you do that, please? What services do you render that 
entitle you to draw a salary out of this local union of approximately 
$27,000'avear? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16099 

Mr. Peters. ] res[)e('t fully decline to answer because I lionsstly 
believe my answer ini<rht tend to incriminate me. 

The (yiiAiHMAX. You leave the impression, those of you who take 
the fifth amendment on the question of what kind of service you render 
to a union or to a local or to or^i^anized labor, as to what kind of 
services you render, that there is something innnoral or illegal about 
representing a union, or representing working people. 

It casts a reflection that I don't think they deserve. I think that 
the working ])eople of tliis country, the dues-paying members, like the 
rest of the })eople of America, are decent, law-abiding citizens. I 
think it is an outrage that union leaders, peo]:)le who occui)y positions 
of trust, have to come in hei-e and virtually slander them and lie 
about them by taking the fifth amendment when they testify under 
oath that tliey can tell what they do to serve them without possible 
self-incrimination. 

I think it is just that flagrant a case of either the abuse of the fifth 
amendment or willful reflection upon honest, decent unionism. 

Senator Ervin. Mr. Chairman, as you remark, there are a lot of 
people that fail to distinguish between union officers who come here 
and take the fifth amendment, and others like Mr. Healy who come 
here and take the stand and, Mithout any fear, give the committee 
testimony. 

I am convinced from attending these hearings that a large per- 
centage of the corruption that we have unearthed in some of the 
unions we have investigated has been due to the fact that the officers 
in those unions have absolutely refused to abide by any code of ethics 
■which keeps them from occupying a position to put them in conflict 
of interest as is forbidden by the code of ethical practices of the 
AFL-C;iO. 

If officers would observe such a code of ethical practices in these 
unions where officers take the fifth amendment, a large part of the 
corruption that we have discovered would never have occurred. 

The Chairman. I think that the public draws the distinction be- 
tween the decent element in unionism, as Mr. Healy comes up here 
and cooperates and tries to help the committee and tries to help the 
Government and rise to render a real service to unionism by helping 
to expose and helping to disclose the information that would give the 
Congress what it needs to legislate against this element that is un- 
worthy, in my judgment, of the name of unionism. 

They have to reflect upon the people they w^ork for to avoid telling 
the kind of service they render. 

All right ; proceed, Mr. Kennedy. 

Mr. Kennedy. Now, Mr. Chairman, the matter that Mr. Peters is 
being called on primarily deals with this situation in Chicago, where 
the efforts of Paul Dorfman were working for Mr. Peters' local to 
bring the employees of the Waste Trade Industry of Chicago into the 
Teamsters' Union. 

We have the infonnation and the testimony from previous witnesses 
that this was done with the collusion of the employers. We also have 
information that this arrangement was made in February of 1958 at a 
meeting at the Castaways jNIotel in Miami Beach, Fla., which the rec- 
ord shows was attendee! by Mr. Paul Dorfman, Mr. Allen Dorfman, 
Mr. Don Peters, and that Mr, Ted Shulman, head of the association, 
and INIr. James Iloff a, were also present. 



16100 IMPROPER ACTWITIES IN THE LABOR FIELD 

We also liave information that Mr. Bernie Nemerov also attended 
the meeting. 

The Chairman. Mr. Peters, the Chair presents to you a photostatic 
copy of a check dated March 20, 1958, drawn in favor of the American 
Airlines, Inc., in the amount of $860.38. It is drawn on the "Warehouse 
& Mail Order Employees Local Union, No. 743, countersigned by Don 
Peters as president. 

I ask you to examine that photostatic copy and state if vou identify 
it. 

(The document was handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. Peters. What is the question. Senator ? 

The Chairman". Do you identify that photostatic copy of the check 
as a copy of the original, and are you familiar with the check ? 

(The witness conferred with his counsel.) 

Mr. Peters. I respectfully decline to answer, because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Let the record show the Chair presented the check. 
I now ask you to examine the signature above the line that says "Coun- 
tersigned" on the end of the check. I ask you to state whose name 
appears there. 

(The witness conferred with his counsel.) 

Mr. Peters. Donald Peters. 

The Chairman. Is that name written in your signature ? 

Mr. Peters. Yes, sir. 

The Chairman. Thank you very much. Then you did sign the 
check ? 

Mr. Peters. Yes, sir. 

The Chairman. The check may be made exhibit No. 230. 

(The check referred to was marked "Exhibit No. 230" for reference 
and w^ll be found in the appendix on p. 16192.) 

The Chairman. For what purpose was the check issued, Mr. Peters ? 

(The witness conferred with his counsel.) 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. I believe the stub of the check shows that it is for 
air travel for Hesther and Peters. Would that Peters be you? 

Mr. Peters. I didn't hear the question. 

The Chairman. I think the stub of this check, shows, or has a 
notation on it, that it is for air travel for Hesther and Peters. 
Would that Peters be you ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Who is the man Hesther ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Do you know him ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. On that transportation that was purchased, did 
you travel from Chicago to Miami at that time ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16101 

The Chairman. While you were there in Miami Beach, I believe it 
was, did you stay at the Castaways ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. I hand you here photostatic copies of hotel bills, 
one charged to Don Peters of 220 South Ashland Boulevard, Chi- 
cago, 111. Is that your address ? 

Mr. Peters. Yes, sir. 

The Chairman. I hand you this photostatic copy of hotel bills, 
dated February 16, 1958, and ask you to examine it and state if you 
identify it. 

(The documents were handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. Peters. What was the question, Senator? 

The Chairman. Do you identify that as your hotel bill while you 
stayed down there? That is a photostatic copy of it. Do you iden- 
tify it as such ? 

^tr. Peters. I don't recall, sir. 

The Chairman. It appears to be about correct, doesn't it? 

Mr. Peters. I didn't hear that. 

The Chairman. I say, upon your examination of it, does it appear 
to be substantially correct? 

Mr. Peters. I have no knowledge. 

The Chairman. Did you receive a bill for your hotel when you 
stayed down there ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman In other words, if you stayed at the hotel and the 
hotel presented ;,ou a bill, that might tend to incriminate you? Is 
that what you are testifying? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve that my answer might tend to incriminate me. 

The Chairman. Make tliat item, that hotel bill, exhibit No. 231. 
There will be further testimony about it. 

(The document referred to was marked "Exhibit No. 231" for ref- 
erence and may be found in the files of the select committee.) 

The Chairman. May I ask you if Mr. Paul Dorfman and Mr. Allen 
IM. Dorfman also stayed at the same hotel at the same time as you were 
there, as reflected by that bill ? 

Mr. Peters. I respectfully decline to answer because I honastly be- 
lieve my answer might tend to incriminate me. 

The Chairman. Do you know Allen Dorfman ? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

The Chairman. Do ybw know Paul Dorfman ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Have you ever had any business transactions with 
them ? 

i\Ir. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

36751 — 59 — pt. 43 11 



16102 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Tlie Chairman. What scheme or business transaction did you talk 
or confer about while you were in Miami Beach at this hotel, at that 
time, February 1958? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

The Chairman. Did something take place there that you can't talk 
about without the possibility of self-incrimination on something be- 
tween the three of you ? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

The Chairman. All right, Mr. Counsel, you may proceed. 

Mr. Kennedy. Mr. Chairman, could we have Mr. Dick Sinclair 
place in the record the hotel records ? 

The Chairman. Mr. Sinclair, please be sworn. 

You do solemnly swear the evidence you shall give before this Sen- 
ate select committee shall be tlie truth, the whole truth, and nothing 
but the truth, so help you God ? 

Mr. Sinclair. I do. 

TESTIMONY OF RICHARD G. SINCLAIR 

The Chairman. State your name, your place of residence, and your 
present employment. 

Mr. Sinclair. My name is Richard G. Sinclair. I am employed 
OF a staff member of the Senate Select Labor Committee. My resi- 
dence is Washington, D.C. 

The Chx\irman. Have you been active in the investigation of this 
particular subject matter mider investigation, particularly Mr. Dorf- 
man, Mr. Paul Dorfman, Allen Dorfman, and Mr. Peters, who is 
presently on the witness stand ? 

Mr. Sinclair. I have, sir. 

The Chairman. I hand you here a photostatic copy of what pur- 
ports to be a copy of the hotel bill of Mr. Paul Dorfman and also of 
Mr. Allen M. Dorfman, at the Castaways, Miami Beach, Fla., dated 
February 10, 1958. 

I will ask you to examine those photostatic copies and ask you if you 
identify them. 

Mr. Sinclair. I do identify them, sir. 

The Chairman. Where did you procure them? How were they 
procured ? 

Mr. Sinclair. Tliese were procured from the Castaways Motel. 

The Chairman. They may be made exhibit No. 232. 

(The documents referred to were marked "Exhibit No. 232" for 
reference and may bo found in the files of the Select Committee.) 

Mr. Kennedy. Mr. Chairman, we also have the invoice on Shul- 
man's transportation down to Miami. 

The Chairman. Mr. Sinclair, I present you with another document 
and an invoice. The document I refer to is Delta Airlines, Inc., trans- 
portation receipt, and the invoice is No. 28747, dated February 3^ 
1958. 

Will you examine that document and invoice and state if 3'ou iden- 
tify them ? 

(The documents were handed to the witness.) 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16103 

Mr. Sinclair. This is an invoice for air travel for Bernie Nemerov 
and Ted Shulman to Miami in February 1058. I do identify it. 

The Chairman. From where? 

Mr. Sinclair. From the records of the Sanatex Corp., which is the 
corporation in which Mr. Shulman is principal stockholder. 

The Chairman. And the transportation was from Chicago, for 
travel from Chicago to Miami ? 

Mr. Sinclair. From Chicago to ^liami ; that is correct. 

The Chairman. That may be made exhibit No. 233. 

(Document referred to was marked "Exhibit No. 233" for reference 
and will be found in the appendix on p. 16193.) 

Mr. Kennedy. To expedite this matter, Mr. Chairman, could I 
further call Mr. Sinclair and place some other documents in the 
record ? 

The Chairman. Very well. 

Mr. Kennedy. We also found, with our interview with Mr. Shul- 
man, that he notified us or informed us that Mr. Hoffa was also pres- 
ent ; is that correct ? 

Mr. Sinclair. That is correct. 

Mr. Kennedy. Mr. Shulman will be a witness. 

TESTIMONY OF DONALD PETERS, ACCOMPANIED BY COUNSEL, 
EDWARD J. CALIHAN, JR.— Resumed 

The Chairman. Mr. Peters, tell us who were present down there 
at this conference, will you, please, and that will shorten it. 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Very well. Proceed. 

Mr. Kennedy. I just want to go into some expenses of that local 
union, Mr. Chairman. 

Did your union purchase $600 worth of tickets to the Robinson- 
Basilio fight, Mr. Peters ? 

jNIr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Do we have some documents on that ? 

The Chairman. I present to you a check, countersigned by you, 
drawn on your local No. 743, dated March 7, 1958, in the amount of 
$600, payable to Harold Ryan. 

Will you examine that original check and state if you identify it ? 

(Document handed to the witness.) 

(Witness conferred with his counsel.) 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

The Chairinian. Let that check be made exhibit No. 234. 

(The document referred to was marked "Exhibit 234" for refer- 
ence and will be found in the appendix on p. 16194.) 

The Chairman. Mr. Sinclair, I present to you a check which I 
have just presented to Witness Peters. It has been made exhibit No. 
234. I will ask you to identif}^ the check for us, please, sir. That is, 
if you can. 

Mr. Sinclair. I identify the check, Senator. 

The Chairman. What is it ? 



16104 IMPROPER ACTIVITIES IX THE LABOR FIELD 

Mr. Sinclair. A check for $600, made payable to Harold Ryan. It 
is dated I^Iarch 7, 1958. It is for 15 fight tickets to the Robmson- 
Basilio fight, at $40 apiece. . 

The Chairman. Is it drawn by the union 5 

Mr. Sinclair. Drawn by local 743. 

The Chairman. Fifteen fight tickets ? 

The Chapman. Mr. Peters, who attended the fight at union expense, 
the sweat of the boys who sweat and earn the money ? i_„,,H v 

Mr. Peters. I respectfully decline to answer because I honestly 
believe mv answer might tend to incriminate me. 

The cIaikman. if you did, don't you think you owe ^^ur union 
boys the money that you took out of their treasury and paid for these 

^'m?' Peters. I respectfully decline to answer because I honestly, 
believe mv answer might tend to incriminate me. 

Mr Kennedy. Mr! Chairman, we have here where they went to 
dinner pri^r to going to the fight. This is a bill for $196 to pay for 

^^'The^'c^iliRMAN. Mr. Sinclair, we have a witness who could give us 

''^^'^:^^X'^^^^^ which I now present to 

^^Sr.'siNri'^Trdlck is drawn on the funds of Local 743 for 
$196.60, made payable to the Erie Cafe, and dated April 1' l^f \J^ 
is for 26 dinners by Mr. Peters' party on March 25, 1958, at the J^rie 

^ The Chairman. This check and the bill attached to it may be made 

''(D^ent'r^ferred to was marked "Exhibit No ^5'' for reference, 
and will be found in the appendix on pp. 1619o-lblJb.) 

The Chairman. Mr. Peters do you want to make any comment 
about this check, $196.60, to the Erie Cafe ? 

The CH^^RMfN.' Do vou want to state why you think this was an 
appropriate charge against the boys who work and who pay the dues? 
Do you want to make any comment about that i i_,,^.f u, k^ 

Mr Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incrimmate me. 

The Chairman. How many of you feasted on this $196 on that 

"^"^Mr Peters. I respectfully decline to answer because I honestly be- 
lieve mv answer might tend to incriminate me. 

The Chairman. Did you leave the affair hungry ? , ^^^ . . , , 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve mv answer might tend to incriminate me, sir. , i i 
ThrCiiAiRMAN. All right. I believe the check has already been 

"Mr KENNE^rJv. What was that charged to on the books and records ? 

Mr*. Sinclair. The charge on the books and records was to organi- 
zational expense. 

Mr. Kennedy. For what? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16105 

Mr. Sinclair. Local 743, International Brotherhood of Teamsters. 

The Chairman. How -was the $600 charged for the tickets to the 
fight? 

Mr. Sinclair. That charge was made to the same thing. 

The Chairman. Organizational expenses? 

Mr. Sinclair. Organization expenses. 

Senator Ervin. Maybe they were organizing appetities on one oc- 
casion. 

Mr. Kennedy. "We also found that the members of the Waste Trade 
Industry of Chicago attended the fight, did they not? 

Mr. Sinclair. Yes, they did, Mr. Kennedy. 

Mr. Kennedy. And attended the fight in the same section, sat in 
the same section? 

Mr. Sinclair. They were seated in the same general area with the 
members of the Teamsters local that attended the fight. 

Mr. Kennedy. Here is a check for $4,289.89. 

The Chairman. JNlr. Peters, the Chair presents to you a photo- 
static copy of a check dated November 5, 1957, payable to the Fon- 
tainebleau Hotel Corp., in the amount of $4,289.89. It appears to be 
on your local. No. 743, and countersigned by you, together with a 
bill attached to it, which says "The James Hofi'a Dinner, your share, 
one-third of $12,869.65." Your one-third of it is $4,289.89, the amount 
of the check, I hand you the check, a photostatic copy, and also the 
original bill. I ask j'ou to examine them and state if you identify 
them. 

(Documents handed to the witness.) 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer may tend to incriminate me. 

The Chairman. Is there something about giving Jimmy HofFa a 
dinner, a lavish dinner like that, that might tend to incriminate you 
or the local union you represent ? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer may tend to incriminate me. 

The Chairman. The check and the bill attached will be made 
exhibit No. 236. 

(Documents referred to were marked "Exhibit No. 236" for ref- 
erence and will be found in the appendix on pp. 16197-16198.) 

Mr. Kennedy. Mr. Chairman, that was put a third of the cost 
of tlie dinner. 

The Chairman. That is what it shows on the bill. 

Senator Er\tn. Was that dinner given to Mr. Hoffa in connection 
■with his campaign for election to the presidency of the Teamsters 
Union in Miami last year ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. INIr. Peters, I present you another check drawn on 
your union, dated December 14, 1956, in the amount of $1,150, made 
payable to cash. It appears to be countersigned by you. I will ask 
you to examine that check and state if you can identify it. 

(Document handed to the witness.) 

(Witness conferred with his counsel.) 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 



16106 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. The stub of that check shows for "Christmas gra- 
tuities." Do you know what that is ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Was the Christmas presents you purchased on be- 
half of your union ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Who got that gratuity ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Did you get some of it ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. The check will be made exhibit No. 237. 

(The check referred to was marked "Exhibit No. 237" for reference 
and will be found in the appendix on p. 16199.) 

The Chairman. I present you another check. That was Decem- 
ber 14, 1956, I believe, the other check. Now I present you another 
check dated January 3, 1957 ; it appears to be countersigned by you. 
It is on your local and made payable to Hygrade Food Products 
Corp., in the amount of $1,901.34. The stub to this check recites 
that it is for Christmas turkeys for stewards. 

I wish you would examine the check, and the photostatic copy of 
the check, of the stub, and state if you identify it. 

(Document handed to the witnees.) 

(The witness conferred with his counsel.) 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Do you think buying turkeys to feed stewards is 
kind of incriminating ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. The check and stub may be made exhibit No. 238. 

(Documents referred to marked "Exhibit No. 238" for reference 
and will be found in the appendix on p. 16200.) 

Senator Ervtn. Let me ask a question right there. 

Did your local union authorize you to purchase those turkeys to make 
gifts of them to the stewards ? 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Senator Ervin. I wish you would tell me how it would tend to in- 
criminate you if your local authorized you to expend those funds. 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Senator Ervtn. I can only assume, or at least I think the public 
would assume, that they did not authorize that because it could not 
possibly incriminate you if it had been authorized. 

Mr. Kennedy. Mr. Chairman, I would like to call, if I may, Mr. 
Allen Dorfman, and ask him about nn item that we have. 

The Chairman. Come forward, Mr. Dorfman. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16107 

TESTIMONY OF ALLEN DORFMAN, ACCOMPANIED BY COUNSEL, 
STANFORD CLINTON— Resumed 

The Chairman. Mr, Dorfman, you have been previously sworn. 
You will remain under the same oath. 

Mr. Allen Dorfman. Yes, sir. 

The Chairman. I present to you a photostatic copy of part of a 
hotel bill. It appears to be a hotel bill from the Hotel Saxony, in 
Miama, Fla. I ask you to examine this hotel bill, the photostatic 
copy, and state if you identify it, please, sir. 

( Document handed to the witness. ) 

(The witness conferred with his counsel.) 

Mr. Allen Dorfman. I claim ray privilege under the fifth amend- 
ment of the Constitution. 

The Chairman. Mr. Sinclair? 

Mr. IvENNEDY. It would have to be identified by Mr. Findlay. 

TESTIMONY OF JOHN P. FINDLAY— Resumed 

The Chairman. Mr. Findlay, you have been previously sworn. 
I present to you the photostatic copy of the hotel bill I just presented 
to the witness Dorfman. Can you give us an explanation of it, iden- 
tify it and state what it is ? 

Mr. Findlay. This is a photostat of the invoice rendered to the 
Union Insurance Agency of Illinois, and paid by Allen Dorfman's 
partnership, that company. 

The Chairman. What company ? 

Mr. Findlay. The Union Insurance Agency of Illinois. 

The Chairman. It was paid by Allen Dorfman's partnership com- 
pany, going under the trade name of what? 

Mr. Findlay. Union Insurance Agency of Illinois. 

The Chairman. The Union Insurance Agency of Illinois. What 
is the amount of the bill ? 

Mr. Findlay. The full amount of the bill is $2,142.96. 

The Chairman. Where did you get the bill ? 

Mr. Findlay. We got the original bill from the Saxony Hotel in 
Miami. 

Mr. Kennedy. This bill he is talking about. 

Mr. Findlay. This bill we got from the files of the Union Insur- 
ance Agency of Illinois. 

The Chairman. That photostatic copy of the bill may be made 
Exhibit No. 239. 

(Document referred to was marked "Exhibit No. 239" for refer- 
ence, and may be found in the files of the select committee. ) 

The Chairman. Mr. Dorfman, I ask you to note at the bottom of 
this bill — aparently there was an erasure on line 24, right at the ex- 
treme bottom of the bill. I wish you would examine this photostatic 
copy gain and look at the place where the erasure obviously was made 
on line 24 at the bottom, and tell the committee what was erased. 

(The document was handed to the witness.) 

(The witness conferred with his counsel.) 



16108 IMPROPER ACTIVITIES IN THE LABOR FIELD 

TESTIMONY OF ALLEN DORFMAN, ACCOMPANIED BY COUNSEL, 
STANFORD CLINTON— Resumed 

Mr. Allen Dorfman. I claim my privilege under the fifth amend- 
ment to the Constitution. 

The Chairman. While you have that before you, I present to you 
the original bill, which may help to explain it for you, of which that is 
a photostatic copy. Will you examine the original bill and see what 
is reflected in that line ? 

(The document was handed to the witness.) 

The Chairman. Look at the line where the erasure appears on the 
photostatic copy. 

Mr. Clinton. Is there a pending question, Mr. Chairman ? 

The Chairman. Yes. Do you recognize that as the original from 
which the photostatic copy that has been made an exhibit was taken? 

Mr. Allen Dorfman. I claim my privilege under tlie fifth amend- 
ment to the Constitution. 

The Chairman. You wouldn't say that that is the original, then ? 

Mr. Allen Dorfman. I claim my privilege under the fifth amend- 
ment to the Constitution. 

The Chairman. Do you think that that might tend to incriminate 
you, if that is the original ? 

Mr. Allen Dorfman. Yes, sir. 

The Chairman. I see. What does it say on ihe.t bottom line, line 
24, where the erasure appears on the photostatic copy ? What does it 
say on there ? Look at line 24. 

(The witness conferred with his counsel.) 

Mr. Allen Dorfman (reading). "Check to Donald Peters." 

The Chairman. How much ? 

Mr. Allen Dorfman (reading) . "February 4, 1955, $593.13." 

The Chairman. Did you have Mr. Peters given a check and have it 
charged to your bill or to your company ? 

Mr. Allen Dorfman. I claim my privilege under the fifth amend- 
ment of the Constitution. 

Mr. Kennedy. Did you receive it, Mr. Peters? 

TESTIMONY OF DONALD PETERS, ACCOMPANIED BY COUNSEL, 
EDWARD J. CALIHAN, JR.— Resumed 

Mr. Peters. I respectfully decline to answer because I honestly 
believe my answer miglit tend to incriminate me. 

Mr. Kennedy. Mr. Peters, can you tell 

The Chairman. That bill was paid, as I understand it, out of union 
funds? 

Mr. Kennedy. No; out of the insurance funds. 

The Chairman. Out of the insurance company. 

Mr. Kennedy. The point, of course, Mr. Chairman, is that we sub- 
penaed the records of Mr. Allen Dorfman, and received this record 
from Allen Dorfman, and found tliis erasure, so that you couldn't 
identify the caption that said it was a check to Donald Peters. We 
went then and obtained the original and found the fact that this 
amount of $593 check had been sent. 

The Chairman. Mr. Petei-s, of course, represents the union, and 
Mr. Dorfman represents the insurance company. 



IMPROPER ACTIVITIES IN THE L.\BOR FIELD 16109 

Mr. Dorfmaii, it appears liere tliut you pive a check on your com- 
pany, $59r>.13, to Mr. Peters. I will ask you if you had the insurance 
business of Mr. Peters' lo(;al, locul 74;). 

Mr, Allen Dorfman. I claim ni}' privilege under the fifth amend- 
ment to the Constitution, 

The CiiAiRMAx. AVas tliis a kind of kickback in premiums to Mr. 
Petei-s ? Is that what it is ? Is that why you can't talk about it ? 

Mr, Allen Dorfman, I claim my privilege under the fifth amend- 
ment to the Constitution, 

The Chairman. What kind of a transaction was it? 

If that is an erroneous jissumption in the face of the facts before us, 
if that is an erroneous assumption, will you give us the correct facts 
about it ? 

Mr. Allen Dori-':max, I claim my privilege mider the fifth amend- 
ment to the Constitution. 

The Chairman. Is there anything further, Mr. Kennedy ? 

Mr, Clinton. Mr. Chairman, may I ask the date of that? 

The Chairman, Let this original bill be attached to exhibit No. 
239, Let it be made exhibit 239-A and attached to that exhibit. 

(Document referred to was marked "Exhibit 239-A" for reference, 
and may be found in the files of the select committee.) 

Mr. Kennedy. Mr. Peters, why would you use somebody like Paul 
Dorfman to assist you in organizing the AVaste Handlers employees in 
Chicago ? 

Mr. Peters, Mr, Kennedy, I respectfully decline to answer because 
I honestly believe that my answer might tend to incriminate me. 

Mr, Kennedy. Tliat is the matter w^hich is of primary interest to us, 
as to why, when the evidence was developed, that he was making col- 
lusive deals wuth the employers, that he was very closely associated 
with Mr, Shulman, the evidence w^as that he was not enforcing the 
contracts, and he is kicked out because of these facts and the facts 
that he misused union funds, w^hy would you then use somebody like 
him to assist you in organizing the employees. 

Could you explain that to us, Mr, Peters? 

Mr. Peters. I respectfully decline to answer because I honestly be- 
lieve my answer might tend to incriminate me. 

Mr. Kennedy, Mr. Chairman, I would like to call Mr. Shulman, if 
I may. 

Mr. Clinton. Are the Dorf mans now excused ? 

Mr. Kennedy. Why doesn't he stay until the end of the hearings 
this morning? 

The Chairman. Mr. Shulman, come forward. Be sworn. 

You do solemnly swear that the evidence you shall give before this 
Senate select committee sliall be the truth, the whole truth, and noth- 
ing but the truth, so help you God ? 

Mr. Shulman. I do. 

TESTIMONY OF THEODORE SHULMAN, ACCOMPANIED BY COUNSEL, 

DAVID SILBERT 

The Chairman. State j^our name, your place of residence, and your 
business or occupation. 

Mr. Shulman. My name is Ted Shulman. I live at 6221 North 
Central Park, in Chicago. I am president of the Sanatex Corp. 



16110 IMPROPER ACTIVITIES IN THE LABOR FIELD 

and also executive director of the Waste Trade Industry of Chicago. 

The Chairman. You have counseL 

Mr. Counsel, identify yourself for the record. 

Mr. SiLBERT. David Silbert, member of the Illinois bar, located at 
111 West Washington Street, Chicago, 111. 

The Chairman. All right, Mr. Kennedy. 

Thank you, Mr. Counsel. 

Mr. Kennedy. What is the Sanatex Corp., Mr. Shulman? 

Mr. Shulman. We are in the wiping cloth and polishing cloth 
business. 

Mr. IvENNEDY. And do you sell to the U.S. Government and private 
industi-y ? Is that right ? 

Mr. Shulman. That is right. 

Mr. IvENNEDT. What percentage of your sales are to the U.S. Gov- 
ernment, Mr. Shulman ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe that my answer might tend to incriminate me. 

Mr. Kennedy. If you told how much of your business was with 
the U.S. Government it would tend to incriminate you ? 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. What is there about doing business with the Gov- 
ernment that is wrong or might be incriminating to you? Would 
you tell us? I would like to find out what happens with the Gov- 
ernment that you can't have contact or business with your Govern- 
ment without having possible self-incrimination. Can you enlighten 
us at all ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. You are associated with the business world, aren't 
you? 

Mr. Shulman. Yes, sir. 

The Chairman. Do you regard yourself as a businessman? 

Mr. Shulman. Yes, sir. 

The Chairman. Don't you think it is downright disgraceful and 
contemptible when businessmen and union people can't work together 
or have business relations without placing themselves in the position 
that when they are asked to give a report or an accounting of that 
relationship, that they can't testify without honestly believing that 
a truthful answer to questions pertaining to it might tend to incrimi- 
nate them ? 

Don't you think it downright degrading to be in that situation? 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. All right. Proceed. 

Mr. Kennedy. How many members of the Waste Trade Industry 
are there in Chicago ? 

(The witness conferred with his counsel.) 

Mr. Shulman. About 90. 

Mr. Kennedy. And how many employees do they have ? 

Mr. Shulman. I imagine between 600 and 700 : thereabout. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16111 

Mr. Kennedy. You receive approximately $8,600 from the associa- 
tion each year ; is that right ? 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Is that mcome sent or forwarded directly to the 
Sanatex Corp. ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Is the purpose of that to avoid paying taxes yourself 
on that money ? 

^fr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. And you also receive some $10,000 from the Sanatex 
Corp. ; is that correct? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. You have known Paul Dorfman for how long? 

Mr. Shulman. I respectfully decline to answer because X honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. You have known him for approximately 20 years, 
have you not ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. And you have had arrangements with him since he 
has been head of the Waste Handlers local that he would not enforce 
the contract for your employees ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. You had a close business, financial, and personal 
relationship with Paul Dorfman for a long period of about 20 years, 
did you not, Mr. Shulman ? 

Mr. Shulman. I respectfully decline to answer because I honostly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. For instance, Mr. Dorfman represented you, and 
represented the other members of the Waste Trade Industry, in nego- 
tiating a contract w^ith Teamsters Independent Local 705 in Chicago ; 
isn't that correct? 

While a union official, he represented the association in negotiating 
a contract ; isn't that right ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me- 

Mr. Kennedy. JVfr. Shulman looks so pained, Mr. Chairman. When 
I asked him that question, he shook his head vigorously. I would like 
to show him a document. 

The Chairman. Mr. Shulman, the Chair presents to you two docu- 
ments, or memorandums, one dated November 8, 1951. It is on Waste 
Trade Industry of Chicago stationery. 

Another one is on the same stationery, dated November 16, 1951. 
Each appears to have been signed by you as executive director of the 
Waste Trade Industry, and also by Edward Lissner, as president of 
that association. 

I ask you to examine these two and state if you identify them. 



16112 IMPROPER ACTIVITIES EST THE LABOR FIELD 

( The documents were handed to the witness. ) 

(The witness conferred with his counsel.) 

The Chairman. Do you identify them ? Do you recognize them as 
the originals or as genuine ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe that my answer might tend to incriminate me. 

The Chairman- Does your signature appear on them ? 

Mr. Shui.man. Yes, sir. 

The Chairman. It does. Then they may be made exhibit No. 240. 

(The documents referred to were marked "Exhibit No. 240" for 
reference and may be found in the files of the select committee.) 

The Chairman. You did sign them ? 

Mr. Shulman. Yes, sir. 

The Chairman. Then you are familiar with them ? 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. The Chair, with the approval of the committee, 
orders and directs the witness to answer the question. He acknowl- 
edges having signed it- 

The question is : Is he familiar with the contents? 

Are you familiar with the contents of it ? 

(The witness conferred with his counsel. ) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. With the approval of the committee, the order and 
direction of the Chair will continue throughout your testimony and 
throughout this series of hearings. 

All right, Mr. Kennedy ; proceed. 

Mr. Kennedy. There are some excerpts. It is the Waste Trade In- 
dustry of Chicago, November 8, 1951 : 

To all waste material dealei-s in the city of Chicago. 

It is signed by Ted Shulman, executive director. It says : 

A meeting of all waste material dealers in the city of Chicago has been called 
for 8 o'clock in the Gray Room of the Hotel Sherman* This meeting has been 
called at the urgent request of Mr. Paul Dorfman, secretary-general of Waste 
Material Handlers, Local 20467, AFL, 

Then it goes on to discuss negotiations of the Teamster contract 
and states : 

Please do not make this mistake now. We should like to make clear that if 
you fail to attend this meeting it will be necessary for Mr. Dorfman to assume 
that you are content to pay your drivers in accordance with the wage rates 
established by Teamsters Union Local 705. 

Then over here, on November 16, 1951, another document, in wliich 
it states : 

Mr. Dorfman bus entered into an agreement with the Teamsters Union which 
will cover the majority of drivers employed by our members. 

Then over here, Mr. Chairman, we have another document, January 
15, 1953, showing that they entered negotiations in that year. It says : 

In the fall of 1951, a number of our members faced the problem of being 
forced to increase rates paid to employees not hired as truckdrivers, but who 
occasionally operate trucks in the course of their daily work. Through coopera- 
tion of Mr. Paul Dorfman, our own union representative, a compromise agree- 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16113 

ment was reached with the Teamsters Union whereby certain drivers may con- 
tinue to be paid a rate lower than the $1.75 per hour union scale established by 
the Chicago Teamsters Union, Local 705. 

The Chairman. Mr. Sliiilman, I present to you the document from 
which counsel has just read excerpts. It is dated January 15, 1953, 
on Waste Trade Industry of Chicago stationery. It appears to have 
been signed by you and also Mr. Lissner, as was the other document. 

Mr. Kennedy. Please hand this one, also, Mr. Chairman. 

The Chairman. Also, there is another one on the same stationery^ 
signed accordingly as the other, dated November 2, 1953. 

Will you examine those and state if you identify them ? 

(The documents were handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. SiiULMAN. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Are those your signatures on the documents ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. It is the same signature that is on the other docu- 
ment ; is it not ? That is, the one that you did identify a moment ago, 
made exhibit No. 240 ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Those documents may be made exhibit No. 241. 

(The documents referred to were marked "Exhibit No. 241" for 
reference and may be found in the files of the select connnittee.) 

Mr. Kennedy. Mr. Chairman, Mr. Shulman, again showing the 
association and the tieup with Dorfman, as managing director of the 
Waste Trade Industry, carried on an insurance sales and promotional 
drive for the Dorfman company. He had two employees who sold 
health and life insurance to the employers and to the employees. 
Their names were Ross Miller and Larry Lera, and they were paid 
for that purpose. 

They were paid by the association for the purj^ose of selling in- 
surance for the Dorf mans ; isn't that correct, Mr. Shulman ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Do you mean you paid, out of association funds, 
employees to go out and sell insurance for the Dorf mans? Did you 
do that? 

]\Ir. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. What kind of a liold do these Dorfmans have up 
there in Chicago wdth you folks? They can lead yo.u around and do 
anything with you, can't they ? That is the way it appears ; is that 
correct ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Tlie Chairman. Have they got you all buii'aloed ? You are afraid 
of the Dorfmans ; is that it ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe mv answer might tend to incriminate me. 



16114 IMPROPER ACTrVITIES IN THE LABOR FIELD 

Mr. Kennedy. These two individuals, Larry Lera and Ross Miller, 
were to work particularly with the nonunion employees. The union 
employees were covered by the Dorf man insurance already. 

Here are some sample checks, of which we have more. 

The Chairman. I hand you two checks, Mr. Shulman, one dated 
October 19, 1954, in the amount of $200, payable to Larry Lera ; an- 
other one dated January 21, 1954, in the amount of $386, payable to 
Ross Miller. These checks are drawn by the Waste Trade Industry of 
Chicago. I will ask you to examine the checks and state if you iden- 
tify them. These are original checks. 

(The documents were handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. What were the checks given for? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Were they in payment to these men for services 
rendered in selling insurance for the Dorf mans ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Were they given for some other legitimate pur- 
pose ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. The checks may be made exhibit No. 242 and 
242A. 

(The checks referred to were marked "Exhibit No. 242 and 242 A" 
for reference and will be found in the appendix on pp. 16201-16202.) 

Mr. IvENNEDY. Mr. Chairman, further showing the tie between the 
Dorfmans and Mr. Shulman, we have records indicating and showing 
that Mr. Dorf man and Mr. Shulman vacationed together in the winter 
of 1953 and the winter of 1954, and stayed at the Saxony Hotel in 
Miami. That is the Saxonj^ Hotel that is owned by George Sax, 
at whose bank in Chicago this money had been deposited, the money 
not paying any interest. 

It also is of some interest to note that Mr. Dorfman received re- 
bates on his bills at the Saxony Hotel. 

The Chairman. Do you know Mr, Sax ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. We also can show that they attended many social 
functions together. From an examination of the records, it indicates 
that they dined together frequently at the Erie Cafe, the Singapore 
Restaurant, Fritzel's, Brown and Koppel, and other eating places in 
Chicago ; that the night of the Robinson-Basilio fight, tliis group, the 
association and Mr. Dorfman, all had dinner together at the Erie 
Cafe and then went to the fight. 

We have had the evidence on the fight already put into the record. 
Dorfman and Shulman vacationed together at tlie Joll Projierties 
camp. 

The Chairman. Is that correct? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16115 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Dorfman and Shulman vacationed together at Joll 
Properties camp at Eagle River, AVis. We have a check indicatmg 
that, dated August 1953. 

The Chairman. I hand you a picture which seems to be a picture of 
six men. The full identification of it is not quite clear to the chair- 
man. I would like to present it to you, Mr. Shulman, and see if you 
can help us. 

Will you identify this picture for us, if 3'ou can, please, sir? 

^The photograph was handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Do you recognize anyone in that picture? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Do you think it will incriminate you to recognize 
a picture of yourself ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. You are one of the group of six, are you not? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Where was that picture taken? Wliat was the 
occasion ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. That picture may be made exhibit No. 243. 

(The photograph referred to was marked "Exhibit No. 243" for 
reference and may be found in the files of the select committee.) 

The Chairman. Proceed. 

Mr. KJENNEDY. Mr. Chairman, that picture was taken, according 
to our information, at a testimonial dinner for Paul Dorfman, on 
March 24, 1958, some months after Mr. Dorfman had been kicked 
out of the AFL-CIO. It is a picture showing Mr. Shulman and Mr. 
Dorfman on March 24, 1958. 

The Chairman. Is the statement of counsel correct? 

Mr. Kennedy. It was at the Sherman Hotel. 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Who is the great big old fat boy right in the center 
behind the five ? That isn't Baker, is it ? or is it ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Ivennedy. Mr. Chairman, Barney Baker was attending the 
dinner. 

The Chairman. That isn't Barney Baker, is it? I don't believe 
it is. It may be. I don't want to reflect on Barney if he is not in the 
picture. Do you have any idea about that ? 

(The witness conferred with his counsel. ) 

The Chairman. Is that Barney? You can just say "no" if it isn't, 
and that will leave him out of it entirely. 



16116 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. SnuLMAN. I respectfully decline to answer because I honestly 
believe my answer might tend, to incriminate me. 

Mr. Kennedy. It is not Barney Baker. 

The Chairman. I didn't want to reflect on him. I was trying to 
get this witness to be fair to his pal. 

Mr. SiLBERT. So far as I am concerned, Senator, I would forgive 
you. 

Senator Erven. I wonder sometime if you would write me a con- 
fidential letter and advise me how it would possibly incriminate you 
to admit that this picture of this handsome man is a picture of you. 

Mr. SiLBERT. How confidential ? 

Senator Ervin. Not to be put in evidence. It is just for my 
information. 

Mr. SiLBERT. Is that a question ? 

Senator Ervin. No ; it is just a request. 

The Chairman. In all fairness, I perceive that someone seeing this 
exhibit might come to the conclusion that the man standing next to you 
is Mr. Paul Dorf man. I don't want to be unfair to him, either. 

Would you state whether the man standing next to you is Mr. Dorf- 
man, and, if not, of course, it would be someone else. Who is it ? 

Mr. SiiuLMAN. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Well, we don't want to incriminate him, either. 
If tliat is not him, would you kindly so indicate? 

(The witness conferred with his counsel.) 

The Chairman. You couldn't indicate that for us ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Mr. Chairman, another matter showing the close 
personal relationship and collusion among these various individuals, 
Paul Dorf man, Ted Shulman, and a gentleman by the name of Ross 
Miller, held equal interests in a fighter by the name of Billy Noble 
during 1952-53. 

Is that correct ? He was a promising young heavyweight. 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Who is Ross Miller ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Doesn't Ross Miller have an $80,000 investment in 
the Riviera Hotel in Las Vegas ? 

Mr. Shultsian. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. And this is a picture of the three of them. 

The Chairman. I hand you here another pliotograph containing 
half of the number of pai'ties as the other, o7ily three being in the 
picture. We do not have the exact date, time, place, or circumstances 
of the ]>icture having been taken. Would you help us out? Would 
you examine it and state if yon identify the picture? 

(Photograph handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16117 

The Chairman. You are in the picture, are you not? You are one 
of the parties in the picture, are you not ? 

Mr. SiiuLMAN. I respectfully decline to answer because I honestly 
belieA'e my answer might tend to incriminate me. 

Tlie Chairman. And the man standing immediately on your left 
in the picture, isn't he Mr. Koss Miller ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Is not the third man in the picture Mr. Paul Dorf- 
man ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Now, will you tell us where that picture was taken ? 
Tell us the time and circumstances, what the occasion was, what you 
are celebrating ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. The picture may be made exhibit No. 244. 
(Photograph referred to marked "Exhibit No. 244" for reference 
and may be found in the files of the select committee. ) 

The Chairman. I now hand you a document, a photostatic copy of 
a document, of which the title is "State Athletic Commission of Illi- 
nois, Application for Boxer's License." 

Will you examine that document and state if you recognize it as 
a photostatic copy of the original ? 

Mr. Kennedy. Mr. Chairman, the pictures — have we identified who 
they are ? 

The Chairman. I asked him. 

Mr. Kennedy. One of them is Paul Dorfman, and Ted Shulman is 
on the other end, and Ross Miller is in the middle. 

The Chairman. Is that statement correct that counsel just made 
with respect to that picture that you have just had presented to you? 
Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. I had reference to the. picture made exhibit No. No. 
244. 

Now you may proceed to examine the document that you have 
regarding application for a boxer's license, and state if you recognize 
that as a photostatic copy of the original. 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. I^t the document be made exhibit No. 245. 
(Document referred to was marked "Exhibit No. 245" for reference 
and may be found in the files of the select committee.) 

The Chairman. I^t me see it, please, for further interrogation of 
the witness. 

This document apparently is an application on the part of Bill 
Noble for a license to box under the name of Bill Noble, and it gives 
as references Ted Shulman, Paul Dorfman. and Ross Miller. Are 
you the Ted Shulman referred to in this application ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

36751—59 — pt. 43 12 



16118 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. Did you, Paul Dorfman, and Ross Miller, have 
an interest in this alleged prizefighter? 

Mr. Shtjlman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Was he a flop ? 

Mr. Kennedy. He wasn't bad, Senator. 

The Chairman. Was he pretty good ? 

(The witness conferred with his counsel.) 

Mr. Shtjlman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Mr. Chairman, once again showing the tieup, the 
name of the fighter was Billy Noble, his wife was Mary Noble, and 
both of these people appear on the payroll of Allen Dorfman's insur- 
ance company. 

The Chairman. This is another case like the Davidson fellow ? Was 
the union paying any part of this ? 

Mr. Kennedy. No. Allen Dorfman. 

We have identified Miller as having an $80,000 investment in the 
Riviera Hotel. He also owned — and I don't know whether he still 
owns it — a striptease place called Silver Palm, at 1117 North Wilson 
in Chicago. He is presently in charge of the casino at the Riviera 
Hotel in Las Vegas. 

In examining Shulman's records, we found that Shiilman had an 
outstanding loan to Ross Miller of $5,000 which had not been repaid. 

The Chairman. Do you have information about these things, IVIr. 
Shulman ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. And Mr. Shulman, in October of 1956, promoted 
a gambling flight from Chicago to Las Vegas, which was known as 
the Orson Welles — Hotel Riviera Special. 

Here is a picture of it. 

The Chairman. Do you have information about that ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. This is again showing his relationship with Ross 
Miller, this photograph. 

Senator Ervtn. Mr. Shulman, do you know whether this prize- 
fighter, Billy Noble, performed any services for the insurance com- 
pany of Allen Dorfman, on whose payroll he was carried ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. Mr. Chairman, according to the information that 
we have, the association has paid Mr. Shulman over a period of 5% 
years, in addition to his regular expenses, some $34,855.41. We can 
find no record that he ever reported this on his income tax. 

Is that correct, Mr. Shulman ? 

(The witness conferred with his counsel.) 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate nie. 

Mr. Kennedy. Isn't it also correct that on the payroll of the Sana- 
texCorp. you have a business agent of local 713 of the Teamsters 
Union, who has been selling commodities, selling items to Teamster 
Union members and he is being paid by your company ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16119 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. That is the record for 1958, Mr. Chairman, show- 
ing he received $840.24. 

"We also find that he was a delegate to the convention in Miami and 
that you paid his transportation down and his hotel. Is that correct ? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

Mr. Kennedy. We have the records on that, so if there is any 
question on it we can produce them. 

Here are tlie records showing the hotel bill. 

Despite the trust agreement, Mr. Shulman, while Mr. Paul Dorf- 
man was head of the union, never signed any of these checks. The 
money, as has been testified to, was all placed in this bank, paid no 
interest, and it was a terrific windfall to George Sax, of the Saxony 
Hotel, who also owned the bank. 

Mr. Chairman, the insurance was signed with Allen Dorfman. We 
have had some highly questionable deals in connection with the 
Teamsters and their insurance with Allen Dorfman, and this is cer- 
tainly equally as bad. 

I would like to call Mr. Martin Ulilmann to testify briefly on the 
insurance arrangements with Allen Dorfman's company in connec- 
tion with the Waste Material Handlers Union. 

The Chairman. All right, Mr. Ulilmann, come forward. 

First, Mr. Shulman, I present to you a check drawn on the Sanatex 
Corp. dated October 6, 1957, payable to the Fontainebleau Hotel Corp., 
in the amount of $414.11, together with a bill to Abe Levin in the 
amount of $414.11, 1 believe, the same amount as the check. 

I will ask you to examine the bill, the hotel bill, and the check, 
photostatic copies of the bill and also the original check, and state if 
you identify them. 

( Documents handed to the witness.) 

The Chairman. I believe there are two bills. One is for Norman 
Greene, one of the two bills, and the two bills aggregating $411 were 
paid for by your company. Please examine them and state if you 
identif3^them. 

Do you identify the check, tlie check on your company ? 

Mr. Siiui.MAN. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Do you identify the bills for which the check was 
given in payment? 

Mr. Shulman. I respectfully decline to answer because I honestly 
believe my answer might tend to incriminate me. 

The Chairman. Let the check and bill be made exhibit No. 246 and 
246A. 

(Documents referred to were marked "Exhibit No. 246 and 246A," 
for reference.) 

(Exhibit No. 246 will be found in the appendix on p. 16203 and 
246 A may be found in the files of the select committee.) 

Mr. Kennedy. I would like to ask Mr. Ulilmann if he has made a 
study of the insurance that has been obtained by the Waste Material 
Handlers Union. 



16120 IMPROPER ACTIVITIES IN THE LABOR FIELD 

TESTIMONY OF MARTIN S. TJHLMANN— Eesumed 

Mr. Uhlmann. We have found that between 1946, when the insur- 
ance was first underwritten by the Union Casualty Co. of Mount Ver- 
non, through 1958, that the total premiums amounted to about 
$496,000, and that the claims were $279,000, and that there were some 
dividends paid because the difference between the claims paid and the 
premiums collected was quite excessive, and that the union then re- 
ceived a dividend in the aggregate of a little over $71,000, so that over 
the years the retention by the company was roughly 30 percent of the 
total premiums collected. 

Mr. Kennedy. Wliat was the retention ? 

Mr. Uhlmann. About 30 percent over the years. 

Mr. Kennedy. What is the significance of that ? 

Mr. Uhlmann. Well, it is extraordinarily high, to begin with^ 
and what is significant, of course, is that in the early years, par- 
ticularly in the first 5 years of this insurance, that is, the amount of 
money kept by the insurance underwriter, had a range of about 38 
percent to as high as 75 percent. I am certain that this probably 
exceeds any accomplishment by any underwriter in similar circum- 
stances. 

Mr. Kennedy. There is one other matter I would like to touch on 
briefly. There was an investment, was there not, by an insurance 
company in California ? 

Mr. Uhlmann. Yes, there was. 

In 1955, an insurance company in California bought into the under- 
writer, bought a large block of stock of the company at Mount Vernon 
that was then called Union Casualty & Life Insurance Co. 

Mr. Kennedy. Could you tell us whether there were any payments 
made in connection with that purchase ? 

Mr. Uhlmann. Yes, sir, there were. In the course of this trans- 
action the company in California made payments to four individuals 
that aggregated some $70,000, roughly. Of this sum, $25,000 was 
paid to Mr. Allen Dorfman, although the check was made payable to 
one of his companies, the Windsor Investment Co. and, in addition, 
Mr. Dorfman received an option to buy 400 shares of the con.mon 
stock of that company. 

That option, incidentally, was exercised in December of 1958. 

Mr. Kennp:dy. The $25,000, instead of going directly to Allen Dorf- 
man, where lie would have had to pay taxes on it, was sent to his 
company ; is that correct ? 

Mr. Uhlmann. Yes. 

Mr. Kennedy. So he avoided paying taxes on that, but the com- 
pany would pay the taxes rather than he as an individual ? 

Mr. Uhlmann. That is right, 

Mr. Kennedy. All right. Go ahead. 

Mr. Uhlmann. Tlie option at tlie time it Avas given to Mr. Dorf- 
man, in light of the fact that it then had a market value of roughly 
$120 a share as contrasted with the price at whicli the stock could be 
bought from the company at $80 a share, or a difference of $40 timers 
400 shares — from that it is apparent that the option at that time was 
worth approximately $16,000 over and above the $25,000 cash 
payments. 

Mr. Kennedy. Who else received money ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16121 

Mr. Uhtliviann. ]\Ir. Siclne}^ Korsluik, an attorney in Chicago re- 
ceived $25,000 whicli was described as a commission for some service 
he performed, the details of which I am not acquainted with. 

Mr. Kennedy. Go ahead. 

Mr. Uhlmann. Then Philip Goodman, an attorney, who was re- 
ferred to in yesterdays testimony, was called upon to handle some 
of the transfer of the securities from one group to the other, and for 
that work he received $5,000. 

The fourth person that derived some income as a result of this 
transaction was an Irwin Solomon, who is an accountant in New York 
City, and who has been performing some services for both Dr. Perlman 
and the California Insurance Co. He was paid a so-called finder's 
fee of $12,500. 

Mr. Kennedy. I believe that is everything as far as you are con- 
cerned ? 

Mr. Uhlmann. Yes, sir. 

Mr. Kennedy. Mr. Findlay, I would like to get your testimony on 
the fact that there were records missing. 

Mr. Findlay, did we find from an examination after the records 
of Mr. Dorfman were subpenaed that some of them were missing? 

TESTIMONY OF JOHN P. FINDLAY— Resumed 

Mr. Findlay. That is so. Subpenas were served on Allen Dorfman 
to produce all books and records from January 1, 1950, to November 
of 1957, covering Allen and Rose Dorfman personally, and the Dorf- 
man Insurance Co. and other entities. There was general compliance, 
except for certain books, records, and documents which were con- 
sidered essential to the various ]j]iases of our examination. 

Here are a few of the missing documents : All of Allen Dorfman's 
personal bank checks prior to December 1953 were said to have been 
destroyed. Therefore, they were not available to us. 

No check stubs or checkbook registers were furnished by Allen 
Dorfman for any period. He claimed that he did not maintain them. 

Certain bank checks on his personal bank accounts were missing 
from December 1953 to the end of 1957. 

Certain of the records of the Dorfman insurance entities were not 
produced for our inspection. 

The books and bank statements and checks prior to May 1, 1953 ; 
these records were said to have been destroyed. 

Significant journal entries for the general books are missing. 

Certain Dorfman partnership and company bank checks from May 
1953 to the end of 1957 are missing. 

Vouchers of Allen Dorfman to account for his travel and enter- 
tainment charges have not been completely furnished. 

No vouchers on Eose Dorfman travel expenses, which were of a 
minor nature. 

Vouchers j^ertaining to the acquisition of furniture and fixtures, 
charged on the books of the Dorfman entities, were not produced. 
This deals with the Lucas matter. 

During the course of our review in the offices of Stanford Clinton, 
the attorney for Allen Dorfman, informal memos were furnished 
to Stanford Clinton indicating what these items were. A detailed 



16122 IMPROPER ACTIVITIES EST THE LABOR FIELD 

memo, I think, is in your hands, Mr. Kennedy, as to the particular 
items. 

Mr. Kennedy. And also yesterday, in the submission of your 
memorandum, there was some indication as to some of the checks that 
are missing ? 

Mr. FiNDLAY. That is so. 

Mr. Kennedy. Thank you. I just wanted to get that into the 
record. 

Mr. Chairman, I would like to also point out that Mr. Hoffa's name 
came into the hearing yesterday and it has also come in today. I 
sent him a telegram some 10 days ago, informing him that his name 
would be brought up in the hearing, that we were going to go into 
this matter in some detail, and he was welcome to attend and to testify 
if he so wished. 

The Chairman. He has a standing invitation from now on to 
testify at any time any derogatory testimony should appear in the 
record. 

Is there anything further? 

If not, the committee will stand in recess until 2 :30. 

(Members of the select committee present at time of recess : Sen- 
ators McClellan and Ervin.) 

( Wliereupon, at 12 :53 p.m. the select committee recessed, to re/?on- 
vene at 10:30 a.m., Friday, January 30, 1958.) 



INVESTIGATION OF IMPROPER ACTIVITIES IN THE 
LABOR OR 3IANAGEMENT FIELD 



TUESDAY, FEBRUABY 3, 1959 

U.S. Senate, 
Select Comimittee on iMPRorER Activities 

IN THE Labor or Management Field, 

Washington, B.C. 

The select committee met at 2 p.m., pursuant to Senate Resolution 
44, agreed to February 2, 1959, in room 3302, New Senate Office Build- 
ing, Senator John L. McClellan (chairman of the select committee) 
presiding. 

Present : Senator John L. McClellan, Democrat, Arkansas ; Senator 
Sam J. Ervin, Jr., Democrat, North Carolina. 

Also present : Robert F. Kennedy, chief counsel ; P. Kenneth O'Don- 
nell, administrative assistant; Paul J. Tierney, assistant counsel ; Car- 
mine S. Bellino, accounting consultant; Ruth Y. "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 and Ervin.) 

The Chairman. All right, Mr. Counsel, you may proceed. 

Mr. Kennedy. Mr. John R. Cunningliam is the first witness. 

The Chair^ian. Come forward, Mr. Cimningham. 

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. Cunningham. I do. 

TESTIMONY OF JOHN R. CUNNINGHAM, ACCOMPANIED BY COUNSEL, 
JOSEPH M. WILLIAMSON AND RAYMOND R. DICKEY 

The Chairman. State your name, your place of residence, and your 
business or occupation. 

Mr. Cunningham. My name is John R. Cunningham, and I reside 
at 33-31 163d Street, Flushing, Queens. At the present time I am 
unemployed. I am a truckdriver in Local 584 of the International 
Brotherhood of Teamsters. 

The Chairman. Thank you very much. Do jou have counsel 
present ? 

Mr. Cunningham. I do. 

The Chairman. Counsel, will you please identify yourself ? 

Mr. Williamson. My name is Joseph M. Williamson, and I am 
an attorney, with offices at 100 South Bennett, Urbana, 111. 

The Chairman. Thank you very much. 

16123 



16124 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Dickey. My name, Mr. Chairman, is Raymond R. Dickey, a 
partner in the firm of Danzansky & Dickey, 1406 G Street NW., Wash- 
ington, D.C. 

The Chairman. JNIr. Cunningham, you have presented a prepai'ed 
statement to tlie committee, I believe, more than 24 houi"S before the 
convening of this session ; is that correct ? 

Mr. Cunningham. That is correct. 

The Chairman. This is a statement which you desii-ed to read. 
The Chair has taken the- time to read this 24-page statement, and I 
have examined it carefully, and a great deal of it is not pertinent to 
this inquiry. A great deal of it relates to a conti'oversy or a matter 
at issue apparently between you and one of the monitors, Mr. Schmidt. 

However, I am going to permit, with the approval of the committee, 
the statement, if you wish to swear to it, to be filed and made an exhibit 
for the information of the committee, as sworn testimony, and then 
permit you to proceed ; and if you desire to refer to certain parts of 
it, you may do so. I am not denying it, but there is no use to sit here 
and listen for an hour to a lot of remarks that I think are not per- 
tinent. However, since you desire to file it, it may be filed, and it will 
be made an exhibit, and in your testimony you may refer to such parts 
of it as you desire to; and if we find some of it improper, well, we 
will, of course- 

Mr. Cunningham. I do desire to, Mr. Chairman. 

The Chairman. Do you state under oath that the statement which 
the Chair holds and which you delivered to this committee is true 
according to the best of your knowdedge and belief ? 

Mr. Cunningham. Mr. Chairman, in going over this as you realize, 
we had to hastily comply with the 24 hours, and I have found two 
pla,ces, and when I come to them, I would like to change it, with 
your permission. 

The Chairman. You indicate now where they are, and we will 
make the change before it is filed. 

Mr. Cunningham. I would like to indicate on page 3, "none of 
whom did I meet until on or about September 27, 1957." That would 
include all 12, and I would like to clarify that. 

The Chairman. You say "None of whom did I meet until on or 
about September 27, 1957"? 

Mr. Cunningham. That is correct. 

The Chairman. What do you wish to change ? 

Mr. Cunningham. I would like to modify that. 

The Chairman. What change would you like to make ? 

Mr. Cunningham. Frank Kennedy and Thomas Mann and I both 
knew, they were out of my home local, 584. 

The Chairman. Then you want to add after 1957, say "except"? 

Mr. Cunningham. "Except," and I would like to add, because I 
have given a deposition in the State of New York, and I don't care 
to contradict anything that I have said up tliere, and that is that 
Harold Wills, Stephen Milone and John McManus I had seen and 
talked to for a moment. 

That is my statement there, in clarification. 

The Chairman. What otlier place do you wish to change it? 

Mr. Cunningham. I would like to say on page 16, Mr. Chairman, 
where it starts with "Schmidt terminated this conversation," and 
strike out "by saying." 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16125 

That would be about the 11th line down, sir. 

Tlie Chairman. You have "Godfrey Schmidt terminated this con- 
versation." 

Mr. Cunningham. And I want to strike out "by saying," and I 
would like to substitute "later saying." 

The Chairman. That change had already been made in this copy 
that I have. It had already been made. You have struck out "by 
saying," and you have inserted "later saying." 

All right, do you have any other, Mr. Cunningham ? 

Mr. Cunningham. On page 17 — 

For the first time I learned Godfrey Schmidt was turning in a bill approxi- 
mating $60,000 listing the names of many people who, to the best of my in- 
formation * * * 

Now I was present when that bill was turned in, and T wouldn't 
want to be held down to the penny, that he turned in for Larry 
Smith, $21,000. 

Now, that is filed in the Federal court. 

The Chairman. Do you want to add $21,000 or something? 

Mr. Cunningham. I believe it to be. 

The Chairman. You want to say "I believe it to be $21,000"? 

Mr. Cunningham. And the exact figures on the rest of wdiat he 
submitted is on information and belief. 

The Chairman. All right. 

You say there "to my best memory." 

Are there any other changes ? 

Mr. "Williamson. May we have just a moment? 

Mr. Cunningham. On page 21, Mr. Chairman, on approximately 
the sixth line, where it starts "Mr. Distinti indicated his executive 
board liad directed him." That should read that he had already 
presented the plan to his membership the previous day. 

The Chairman. Now, let me see. That is Mr. Distinti indicated 
what ? 

Mr. Cunningham. Thaf his executive board had directed him to 
explore the possibility of recapturing self-rule for the Teamsters, and 
that he would present our plan to his membership. 

The Chairman. That is the way it reads here. 

Mr. Cunningham. That should be that he had already presented 
it to his membership, and he would present it to his executive board. 

The Chairman. We will change that, "Eecapturing self-rule for 
the Teamsters. He had already presented our plan." That would be 
"He had already presented our plan to his membership and said 

J^g * * * 55 

Mr. Cunningham. And it had been approved. And he would then 
present it to his executive board. 

Mr. Chairman, those are the corrections that I had desired to make. 

The Chairman. All right now, let us see if that is correct. I read 
it now as I have it: 

Mr. Distinti indicated his executive board had directed him to explore the 
possibility of recapturing self-rule for the Teamsters. He had already presented 
our plan to his membership and it had been approved and he would then present 
it to his executive board. 

Is that correct? 

Mr. Cunningham. Yes, sir. 



16126 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. That correction is made. Is there anything further ? 

Now, then, Mr. Kennedy, you may question the witness, and if the 
witness desires to refer to this statement in answer to your questions, 
he may do so, but that statement under oath is now a part of the 
record as sworn testimony of the witness. 

This testimony will be made exhibit 247. 

(Document referred to was marked "Exhibit No. 247" for refer- 
ence, and may be found in the files of the select committee.) 

The Chairman. Proceed. 

Mr. Kennedy. How long have you been a member of the Teamsters 
Union ? 

Mr. Cunningham. I wouldn't give you the exact time. 

Mr. Kennedy. Approximately. 

Mr. Cunningham. Approximately 17 years. 

Mr. Kennedy. Have you ever been an officer of a Teamstei-s Union ? 

Mr. Cunningham. No, I have not. 

Mr. Kennedy. It is a milk drivers local? 

]\Ir. Cunningham. Local 584, Milk Wagon Drivers and Dairy 
Employees. 

Mr. Ivennedy. And have you always been a member of that local ? 

Mr. Cunningham. No, I transferred from local 680, which is its 
counterpart in Newark, N.J. 

Mr. Kennedy. When did you do that? Approximately. I am not 
looking for exact dates. 

Mr. Cunningham. Fourteen or fifteen years ago. 

Mr. Kennedy. Now, are you a member of any local now ? 

Mr. Cunningham. I am a member, paid-up member, of local 584. 

Mr. Kennedy. Are you a member of any other local other than 584 ? 

Mr. Cunningham. No, I am not. 

Mr. KJENNEDY. Have you been a member of any other local of any 
union other than 680, and 584, over a period of the years? 

Mr, Cunningham. Of the years that you refer to ? 

Mr. Kennedy. Of the last three years, for instance. 

Mr. Cunningham. No, I have not. 

Mr. Kennedy. Mr. Cunningham, you were the head of the so-called 
13 which brought some charges in connection with the election that 
was held in October or September of 1957. 

(The witness conferred with his counsel.) 

Mr. Kennedy. I think that I can clarify it. I say in connection 
with the election that was held. 

Mr. Williamson. The action was originally started, and I hate to 
interrupt, but it was to prevent the election. 

Mr. Kennedy. I said in connection with the election. 

Mr. Williamson. Thank you. 

Mr. ICennedy. You originally brought an action and you ai-e head 
of a group of 13 Teamster members who brought an action in con- 
nection with the election that was held in September of 1957? 

Mr. Cunningham. Yes, sir. 

Mr. Kennedy. And tlie action was brought just prior to that time, 
to try first to prevent the election; is that correct? 

Mr. Cunningham. That is correct. 

Mr. Kennedy. And ultimately, after the election was held, there 
were some further actions taken, and some testimony taken here in 
Washington, D.C., in connection with that election? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16127 

Mr. Cunningham. That is correct; yes, sir. 

Mr. ICennedy. And the trial went on for 4 or 5 weeks? 

Mr. Cunningham. I believe it to be 22 trial days. 

Mr. Kennedy. Ultimately there was a stipulation that was signed ? 

Mr. Cunningham. A consent decree. 

Mr. Kennedy. That consent decree permitted Mr. Hoffa to take 
over as president of the Teamsters, as a provisional president of the 
Teamsters, and also appointed three monitors; is that correct? 

Mr. Cunningham. That was a part of the consent decree. 

Mr. Kennedy. Following that you had a dispute, particularly with 
Mr. Godfrey Schmidt, who was the attorney for the original thirteen, 
and ultimately was appointed a monitor, based primarily on your 
feeling that he should make a more exact account of the funds that 
had been collected. 

Mr. Cunningham. That is correct. 

Mr. Kennedy. Now, you brought an action, I believe, a civil action 
in the U.S. District Court for the District of Columbia on April 28, 
1958, for the removal of Godfrey Schmidt as a monitor; is that 
correct ? 

Mr. Cunningham. Well, I am not going to be tied down by dates, 
Mr. Kennedy, but on or about that time I did ; yes. 

Mr. Kennedy. Now, who was your attorney in that case ? 

Mr. Cunningham. My attorney in that case was Murray Levine, 
of 16 Broadway, and a Maurice Friedman, and his offices were on 
Vermont Avenue here in Washington, D.C. 

Mr. Kennedy. Who had referred you to Murray Levine? 

Mr. Cunningham. Mr. Len Golos. 

Mr. Kennedy. "Wlio is Mr. G-o-l-o-s? That is L-y-n-n? 

Mr. Cunningham. L-e-n G-o-l-o-s. 

Mr. Kennedy. Who is he ? 

Mr. Cunningham. Len Golos is a publicity man, and I believe as I 
knew him then and I believe he still is, he is employed as public rela- 
tions man for Heublein & Co. 

Mr. Kennedy. What is the name of that ? 

Mr. Cunningham. The importers, liquor importers, H-e-u-b-1-e-i-n, 
I believe that to be correct, of 9 East 54th Street, New York City, and 
he had done a tremendous amount of publicity work for us as the 
Teamster rank and file committee; and he was sympathetic with what 
I was undertaking here, and he referred me to Murray Levine. 

Mr. Kennedy. Mr. Levine is an attorney in New York? 

Mr. Cunningham. I believe he has a license. 

Mr. Kennedy. And then you had Maurice Friedman here in Wash- 
ington, D.C. ? 

Mr. Cunningham. Yes, sir. 

Mr. KIennedy. Who paid Mr. Murray Levine and Mr. Maurice 
Friedman ? 

Mr. Cunningham. Nobody. 

Mr. Kennedy. Nobody paid them ? 

Mr. Cunningham. Nobody. 

Mr. Kennedy. Wliat arrangements were made to pay them ? 

Mr. Cunningham. As far as Mr. Friedman was concerned, Mr. 
Friedman would have taken a contingency and he handled, and it so 
shows in the court records, that he handled my application for ex- 
penses. As far as that was concerned, had I been successful although 



16128 IMPROPER ACTIVITIES IN THE LABOR FIELD 

there was no determination of that, he would have secured a percent- 
age of my recovery. Murray Levine did not receive a cent in any 
way, shape, or manner, and in fact he loaned me $100. 

Mr. Kennedy. Neither one of them have been paid? 

Mr. Cunningham. Not by me or anybody else. 

Mr. Kennedy. You brought a second action on or about October 6, 
1958, in the U.S. District Court for the District of Columbia, which 
charged Mr. Schmidt with failure to account for funds, misappro- 
priation of funds, and breach of the attorney-client relationship. 

You are not an attorney, as I understand it. Who was your 
attorney in that matter ? 

Mr. Cunningham. I believe that that was Jacques Schiffer, 32 
Broadway. He had cocounsel down here, and correct me if I am 
wrong, of Mr. Simmons. I believe that to be the correct spelling. 
Mr. Benjamin J. Simmons, or something like that. 

Mr. Kennedy. How had you been referred to Mr. Schiffer ? 

Mr. Cunningham. I had been referred to Mr. Schiffer by Moss 
Herman. 

Mr. Kennedy. Who is Moss Herman ? 

Mr. Cunningham. Moss Herman is a member — was a member; he 
is on a withdrawal card now — of local 584. 

Mr. Kennedy. What does he do for a living now? 

Mr. Cunningham. He has a disability. He is on compensation. 

Mr. Kennedy. How long had he known Mr. Schiffer? 

Mr. Cunningham. I don't know. He had told me that he had 
been down here to see you one day, and hearings were going on here, 
and he came up to attend hearings, that you had asked him to come 
up to hear the hearings. Mr. Schiffer was here as an attorney. 

Mr. Kennedy. Who was he representing at that time? 

Mr. Cunningham. I don't know. I am not prepared to say in 
any way, shape, or manner. 

Mr. Kennedy. He was representing, I believe, the individuals in- 
volved in the paper locals who were the associates of Johnny 
Dioguardi. I believe the record shows he represented Sidney Hodes^ 
Harry Davidoff, Nat Gordon. 

Mr. Cunningham. That is news to me. 

Mr. Kennedy. But Mr. Moss Herman related to you that he had 
met Mr. Schiffer up here in the hearing room at the time he was 
representing some witnesses before our committee ? 

Mr. Cunningham. He told me that he asked him for his card here 
in this room, or at a hearing room of the Senate committee. 

Mr. Kennedy. So Mr. Herman recommended Mr. Schiffer to you. 
Did you go and meet with Mr. Schiffer then ? 

Mr. Cunningham. Yes ; I did. 

Mr. Kennedy. He brought this action. Has he been paid ? 

Mr. Cunningham. No, sir. 

Mr. Kennedy. He hasn't been paid either ? 

Mr. Cunningham. No, sir. 

Mr. Kennedy. Wliat arrangements were made to pay him ? 

Mr. Cunningham. Contingency. 

Mr. Kennedy. On or about December 15, 1958, you brought another 
action. No ; I am wrong in that. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16129 

On October 29, 1958, an action was brought in the Supreme Court 
of the State of New York against Mr, Godfrey Sclunidt, about the 
same kind of action that you took here in Washington, D.C., and Mr. 
Schiffer was your attorney there also? 

Mr. Cunningham. Are you referring to the county of Queens? 

Mr. Kennedy. Yes. 

Mr. Cunningham. That is correct. 

Mr. Kennedy. He hasn't been paid for that, either? The same ar- 
rangement has been made ? 

Mr. Cunningham. May I exphiin that, Mr. Kennedy ? 

The Chairman. Yes ; you may. 

Mr. Cunningham. Thank you, Mr. Chairman. 

We could not get service on Mr. Schmidt in Washington. We with- 
drew the action in Washington and we got service on the same action 
in the State of New York. 

The Chairman. You withdrew one suit here and instituted the 
same cause of action, in other words, in another jurisdiction? 

Mr. Cunningham. Because of service. 

Mr. Kennedy. Then on December 15, 1958, an action w^as taken by 
you, Cunningham v. English^ w^hich was a motion for leave to file 
petition for accounting by monitor Godfrey Schmidt and for the sus- 
pension of Godfrey Schmidt from office of monitor and other relief? 

(The witness conferred with his counsel.) 

Mr. Kennedy. Is that correct ? 

Mr. Cunningham. That is correct. We had additional informa- 
tion. We had just secured additional information and for that reason 
we filed down here. 

Mr. Kennedy. Your attorneys in that case were whom? 

Mr. Cunningham. Those representing me here, plus additional co- 
counsel. 

Mr. Kennedy. That is Joseph Williamson and Mr. Dickey ; is that 
correct ? 

Mr. Cunningham. I believe there are a couple more. 

Mr. Dickey. And Mr. Marshall Miller, from my office. 

Mr. Kennedy. How did you happen to get Mr. Williamson and Mr. 
Dickey ? 

Mr. Cunningham. I had met Mr. Williamson at the Woodner 
Hotel. 

Mr. Kennedy. You were staying at the Woodner Hotel ? 

Mr. Cunningham. That is correct. 

Mr. I^nnedy. When had you started staying at the Woodner 
Hotel? 

Mr. Cunningham. Mr. Kennedy, can I answer the first question ? 
You have a dual question. 

Mr. Kennedy. I am sorry. I thought you were finished. 

Mr. Cunningham. No; you have asked about se^•eral people. 

The Chairman. Go ahead. Proceed. 

Mr. Cunningham. I met Mr. Williamson there at the Woodner 
Hotel. I knew that he represented the Woodner Hotel. Because I 
had had information that certain motions were going to be filed in 
the Federal court that would directly affect me, I didn't think that I 
was represented by an attorney, and I asked Mr. Williamson if he 
would file so that I would be represented, and lie filed. 



16130 IMPROPER ACTIVITIES IN THE LABOR FIELD 

He immediately contacted Mr. Dickey and they filed the praecipe 
that they were representing me in the original case of Cunningham v. 
English. 

Mr. Kennedy. How long had you been staying at the Woodner 
Hotel? 

Mr. Cunningham. I have stayed there off and on, I believe — 
please don't pin me down to this date. But it could be the last of 
August or the first of September of 1958. 

Mr. Kennedy. Where had you been staying when you came to 
Washington prior to that time ? 

Mr. Cunningham. I have stayed at the Statler Hotel, I have stayed 
at the Mayflower Hotel. I stayed at the University Club. I stayed 
at the Ambassador. There was a hotel in the Northwest section where 
I stayed with Peter Hoguet. I just don't remember the name. 

Mr. Kennedy. In August or September of 1958 you started staying 
at the Woodner Hotel ? 

Mr. Cunningham. That is correct. 

Mr. Kennedy. And have you stayed at the Woodner Hotel on all 
of your visits here to Washington since that time? 

Mr. Cunningham. I wouldn't want to be tied down on that. I 
think there is one time at the Statler or the Mayflower. 

Mr. Kennedy. But most all the time you stayed at the Woodner 
Hotel? 

Mr. Cunningham. Most all the time. 

Mr. Kennedy. Your attorneys, Mr. Williamson and Mr. Dickey, 
have they been paid any money ? 

Mr. Cunningham. Yes ; they have. 

Mr. Kennnedy. How much money have they been paid? 

Mr. Cunningham. They were paid $2,500 by me. 

Mr. Kennedy. Was that by check or by cash ? 

Mr. Cunningham. That was by cash. 

Mr. Kennedy. AVhere did you get the $2,500 ? 

Mr. Cunningham. You have asked me a question. Please let me 
finish. 

Mr. Kennedy. I thought you were finished. 

Mr. Cunningham. They got $5,000 from Anthony Distinti. He is 
a plaintiff with me in my pleadings in the court of appeals. 

Mr. Kennedy. How do you spell his name ? 

Mr. Cunningham. I believe it to be D-i-s-t-i-n-t-i. 

Mr. Kennedy. Where is he from ? 

Mr. Cunningham. He is from New York City. He is the president 
of local 277, New York City. It is an IBT local. May I speak to my 
counsel, please? 

(The witness conferred with his counsel.) 

Mr. Cunningham. There was an additional $5,000 aside from Mr. 
Distinti that was paid by — I believe that to be local 701, Mr, Robert 
Coar, Bill Nodi and Robert Coar. 

Mr. Kennedy. How do you spell his name? 

Mr. Cunningham. C-o-a-r. 

Mr. Kennedy. Is that Local 701 of the Teamsters? 

Mr. Cunningham. Tliat is correct. That is an IBT local. The 
other local was $2,000 that came from local 617, and I believe that is 
officially listed as Jersey City. 

Mr. Kennedy. From whom was that? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16131 

Mr. Cunningham. Taylor and McKiernan. 

Mr. Williamson. Since these checks were made payable to us, can 
we straighten him out on this? I am certain that you do want the 
record accurate. May I confer with him ? 

The Chairman. You may confer with him. 

(The witness conferred with his counsel.) 

Mr. Cunningham. We wanted to reHect in the record that those 
checks were drawn against the local unions, not as individuals. 

The Chairman. Now let us see how many checks. One for $5,000 
on local 377? 

Mr. Cunningham. No; 277, sir. 

The Chairman. No ; 277 instead of 377 ; all right. Then there is a 
$5,000 check on local 701 ? 

Mr. Cunningham. Correct. 

The Chairman. And a $2,000 check on local 617? 

Mr. Cunningham. That is correct. 

The Chairman. And there was $2,500 in cash ? 

Mr. Cunningham. From me. 

The Chairman. From you. That is all you have covered to now. 

All right ; proceed. 

Mr. Kknnedy. AVould you tell the committee where you received 
the $2,500 in cash ? 

(The witness conferred with his counsel.) 

Mr. Williamson. He wants to talk about the last question, if we 
may liave just a moment. 

(The witness conferred with his counsel.) 

Mr. Cunningham. Please ask your question. 

Mr. Kennedy. I asked you where the $2,500 in cash came from. 

Mr. Cunningham. In November of 1958, Mr. Williamson told me 
what he had to have. I, in turn, went out and went around hunting 
for money, and I also told Moss Herman that, "These boys don't 
operate on a contingency basis. They got a meter that runs and I 
got to feed it." 

I was unable to raise that much cash myself. However, Moss 
Herman did raise that money, and on December 9 he gave the money 
to me, and which, on December 9, I turned over to Mr. Williamson. 

The Chairman. You procured the $2,500 from Moss Herman? 

Mr, Cunningham. That is correct. 

The Chairman. That is the same money you procured from 
him 

Mr. Cunningham. I would like to say at this point- 



The Chairman. That you turned over to your counsel. 

Mr. Cunningham. I would like to say tliat Mr. Williamson didn't 
like the idea of cash in any way, shape, or manner. He wants cash. 

Mr. Kennedy. Did he take it ? 

Mr. Cunningham. He took it, because it saved me going out and 
going to a bank, getting a cashier's check, turning around and coming 
back with it. He took it ; yes. 

The Chairman. All right. It is being accounted for. Proceed. 

Mr, Kennedy. This is the Moss Herman that you mentioned 
earlier? 

Mr. Cunningham. Yes ; it is. 

Mr, Kennedy, Where did Mr. Moss Herman get the money? 

Mr. Cunningham. I don't know. 



16132 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. Didn't you ask him ? 

Mr. Cunningham. I never looked a gift horse in the face in my life. 

Mr. Kennedy. You didn't ask him ? 

Mr. Cunningham. No ; I was glad to see it. 

Mr. Kennedy. Here is a man on relief and he 

Mr. Cunningham. He is not on relief. His wife works. 

(The witness conferred with his counsel.) 

The Chairman. That is kind of a distinction without difference, 
isn't it? 

Mr. Cunningham. It sure is. 

(The witness conferred with his counsel.) 

Mr, Kennedy. Mr. Cunningham, did he have any means of em- 
ployment himself at the time ? 

Mr. Cunningham. I have already told you. He was on compensa- 
tion, and his wife works. 

Mr. Kennedy. Where did he get $2,500 ? 

Mr. Cunningham. I don't know. 

Mr. Kennedy. Weren't you interested ? 

Mr. Cunningham. No, sir; I was interested in paying the bill 
and getting the money going again. 

Mr. Kennedy. What if the $2,500 came from Mr. Hoffa? Did 
that concern you at all ? 

Mr. Cunningham. It sure would have. 

Mr. Kennedy, Would you have wanted the money if it came from 
Mr. Hoffa? 

Mr. Cunningham, No, sir. 

Mr. Kennedy. Did you ask him if it came from Mr. Hoffa? 

Mr. Cunningham. No, sir. 

Mr. Kennedy. You didn't ask him any questions ? 

Mr. Cunningham, No, sir, 

Mr. Kennedy. You just took the $2,500 ? 

Mr. Cunningham. That is right. 

Mr. Kennedy. Was Mr. Herman paying any of your other bills 
during this period of time ? 

Mr. Cunningham. Yes, he was. 

Mr. Kennedy. He was ? He was paying your bills ? 

Mr. Cunningham. Yes. 

Mr. Kennedy. Where was he coming up with all of this money 
that he was able to pay your bills ? 

Mr. Cunningham. Mr. Herman paid hotel bills. 

Mr. Kennedy. Did he ever t^ll you where tlie money came from? 

Mr. Cunningham. No, he did not; not up until approximately, as 
I have reflected in this statement to you, I reflected here, and I would 
like to refer to that, if I may 

The Chairman. You may refer to your statement. Indicate the 
page, please. 

Mr. Cunningham. Yes, I will, Senator. 

Mr. Kennedy. Go ahead. 

Mr. Cunningham. Approximately 2 weeks ago. 

The Chairman. What page are you on ? 

Mr. Cunningham. That is the last page, Mr. Chairman. 

The Chairman. All riirht. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16133 

Mr, Cunningham. Approximately 2 weeks ago, and I don't want 
to be held down to 14 days on 2 weeks, though I believe it to be a 
little longer ago than that — I believe it to be back at the turn of 1959, 
December of 1958 or the first of 1959, of January — Mr. Herman stated 
to me that for certain of my travel and hotel expenses he was being 
reimbui-sed by Mr. James Hoffa out of Mr. Hoff a's personal funds. 

That was contrary to what he had told me earlier when he said 
that he was doing this personally. Mr. Herman told me further 
that Mr. Hoffa knew nothing of this, and that he did not want to 
disclose this to Mr. Hoffa as the International Brotherhood officers 
did not approve of my conduct, and the type of litigation I had 
commenced. 

I do not personally know the truth of this, and have discussed the 
pending litigation with Mr. Holla only briefly once when I called upon 
him in connection with my dispute with the New York local. 

I would like to say that at the time that I brought this up to Mr. 
Herman, I asked him then where the $2,500 came from, and he told 
me that that was absolutely none of my business. We had gone out 
and raised money before, which was the truth. We had perfected 
appeals in New York City in which they required $2,000. We had 
perfected other appeals in the State of New York ; we were plaintiff 
intervenors up there. 

I had every reason to believe that Moss Herman would not do 
anything to me that would hurt me. When I spoke to him about this, 
I got very mad at him. I told Mr. Herman if he fully realized 
what he was doing to me, that this could jeopardize the suits that 
I had pending now. 

Mr. Kennedy. Speaking of suits that you have now, you have 
another one that you filed on January 6, 1959, for leave to file a 
petition of mandamus or writ of prohibition, is that right, you versus 
Judge Letts ? 

Mr. Cunningham. That is correct. I believe there are three, and 
then there are some plaintiff intervenors in that action, too. 

Mr. Williamson. Mr. Chairman, could we very briefly, with 
reference to that suit, state that it is set for oral argument on Friday 
of this week in the court of appeals? We certainly don't want to 
obstruct your questioning, but we are hopeful that it will not be 
necessary that the fact of the suit or the issue in the suit be too widely 
explored here. 

The Chairman. I don't think we will. It is a question of finances. 

Mr. Kennedy. When you were staying at the Woodner Hotel, were 
you paying your own bills ? 

Mr. Cunningham. At what time ? 

Mr Kennedy. During the time that you started staying at the 
Woodner Hotel, which I understood from your answer was approxi- 
mately June or July. 

Mr. Cunningham. No ; I believe I said the last of August or early 
September. I did not. 

Mr. Kennedy. Who was paying your bills ? 

Mr. Cunningham. Moss Herman. 

Mr. Kennedy. INIoss Herman was picking those bills up ? 

Mr. Cunningham. That is correct. 

36751 — 59— pt. 43 13 



16134 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr, Kennedy. Did you speak to him about where he was getting 
the money to pay your hotel bills ? 

Mr. Cunningham. No. Not until it was brought to my attention 
and my lawyers told me the Senate Kackets Committee are out here 
subpenaing a tremendous amount of material out here, and this is 
going to reflect, and you had better straighten out with Mr. Herman 
]ust exactly what is going on. 

That is what I referred to in my last statement to you. 

Mr. Kennedy. How much money did you get from Mr. Herman, 
other than $2,500 ? 

Mr. Cunningham. I have turned a list over to you, or some of 
your staff members, and I referred to $800 in SejDtember of 1958. 

Mr. Kennedy. Was that by check or by cash ? 

Mr. Cunningham. That was by cash. 

Mr. Kennedy. That was from Moss Herman ? 

Mr. Cunningham. That is correct. 

Mr. Kennedy. What did you do witli that $800 ? 

Mr. Cunningham. My car had been repossessed and the payment 
on it was $770, plus towing charges. I got my car back. 

Mr. Kennedy. And in addition to that, your liotel bills, is that 
right, were being paid by Mr. Herman ? 

Mr. Cunningham. As well as the $2,500. 

The Chairman. Do you, yourself, know the amount of your hotel 
bills that Mr. Herman paid for you ? 

Mr. Cunningham. No, I couldn't compute that right at this mo- 
ment. No, I couldn't, sir. I will try to, sir. 

The Chairman. I think we have it. 

Mr. Cunningham. I have a bill there of my own right now. 

Mr. Kennedy. Who else have you received money from since April 
of 1958? 

Mr. Cunningham. Mr. Kennedy, with respect to you, I turned 
over a list to you that was copied here yesterday. 

The Chairman. Do you have an extra copy of it ? 

Mr. Williamson. We prepared that for ]VIr. Kennedy yesterday. 

Mr. Dickey. The question was from April of 1958. The list we 
gave you, I think, predates that period. 

Mr. Kennedy. That is correct. I am interested from April of 
1958. 

Mr. Dickey. Thank you. 

(The witness conferred with his counsel.) 

The Chairman. I think this starts from February 1958, according 
to the copy I have here. One item on its savs Februarv and April, 
and then Golos, $800. 

Mr. Cunningham. That is correct. 

The Chairman. Beginning with that, would you read the others? 

Mr. Kennedy. Could you signify or indicate which ones of these 
are cliecks and which ones are cash ? 

Mr. Cunningham. Yes ; I will. 

If you will look to the one just above that, my sister, Beatrice 
Chamberlin, I gave from November to date. So that would have to 
reflect in there, too, because she gave me after April. 

Mr. Kennedy. Fine. I^t's get her in, too. 

The Chairman. That starts with November 1957. Your sister, 
Beatrice Chamberlin, $3,360. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16135 

Mr. Cunningham. Correct. 

The Chairman. She has given you that much from that time up 
until now. 

Mr. Cunningham. She says it is more. I am argumg with her. 

The Chairman. Well, at least, so far as you know, it is at least 
that much? 

Mr. Cunningham. That is what we kept a record of. 

The Chairman. Had she let you have this amount all at one time 
or at different times ? 

Mr. Cunningham. Different times. Weekly. 

The Chairman. Were they checks or cash ? 

Mr. Cunningham. Cash. That was cash. 

The Chairman. All of it was cash ? 

Mr. Cunningham. That is correct. 

The Chairman. Now we go to the next one. This is December — 
well, that is not involved. Next, then, is February and April, and 
then Golos, $800. 

Mr. Cunningham. That is correct. 

The Chairman. Is that cash or check ? 

Mr. Cunningham. That was $500 and $300. He has the notes for 
them. Whether I got the $300 first in February or the $500 first, I 
couldn't say, but he has two notes given, and it was cash. Ethel Myers, 
May 1958, $600. That was cash over a period of time. That is time. 

The Chairman. She is a friend of your sister's ? 

Mr. Cunningham. She lives with my sister. 

The Chairman. She lives with your sister? 

Mr. Cunningham. At 805 West Market Street. 

The Chairman. Then you have May 1958. 

Mr. Cunningham. Agnes Kline, $1,750. The initial was $750 that 
she cashed — whether that was a check or war bonds she cashed, I don't 
know. I know when it was secured, and the $1,000 was from May to 
date. 

The Chairman. From what ? 

Mr. Cunningham. All of that was in cash; $750 was the first one. 

The Chairman. $750 was the first payment and $1,000 the second? 

Mr. Cunningham. No; I believe there was two payments on the 
$1,000. 

The ClL\iRMAN. All right. The first $750, and then two pay- 
ments 

Mr. Cunningham. xVnother $1,000. I wouldn't even want to be 
held down to two payments. 

Peter Hoguet, June to September of 1958, Peter Hoguet, some 
checks and some cash. One check will reflect $100 and some odd dol- 
lars paid to the New York Telephone Co. ; a check to me for some. 
Mr. Hosruet has it, and unfortunately he is out of town. I don't 
want to oe pinned down to exactly $350 to Mr. Hoguet. It could be 
more. It certainly isn't less. 

The Chairman. All right. 

Mr. Cunningham. Murray Levine is the lawyer I referred to ear- 
lier today and that was the $100 check. O. E. Snyder is a brother- 
in-law of mine that refers to in August of $200 in cash. 

The Chairman. 1958. 

Mr. Cunningham. Jack Zipkin is the owner of Premium Dairy in 
New York City, and that was a check, $115. 



16136 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Sam Browonick is August. 

Mr. Kennedy. B-r-o-w-o-n-i-c-k? 

Mr. Cunningham. I believe that to be correct. 

Mr. Kennedy. Go ahead. 

Mr. Cunningham. $1,150, in cash. 

Mr. Kennedy. Who is he? 

Mr. Cunningham. Sam Browonick is an organizer and I believe a 
business agent in a Federal charter local that was chartered for office 
help, but it wasn't connected with the 153. That is the white-collar 
workers. 

Mr. Kennedy. How long have you known him ? 

Mr. Cunningham. I met him in Godfrey Schmidt's office some- 
time during the case. I would say to date maybe 13 months, 14 
months, maybe a little less. I wouldn't be pinned down on that. 

Mr. Kennedy. He advanced you $1,150 in cash ? 

Mr. Cunningham. That is correct. 

The next is Hyman Cohen in September, and he is a member of 
local 584, $60 in cash. I met him on the route and I took some of his 
receipts. The last two I have already given to you. 

Mr. Kennedy. That is Moss Herman ? 

Mr. Cunningham. Moss Herman on two occasions, $800 and $2,500. 

The Chairman. Is there anything further ? 

Senator Ervin. I don't know whether 1 heard this right or not, 
but I understood you to say that Moss Herman finally told you that 
he got the $2,500 cash he gave you coming out of the personal funds 
of Jimmy Hoffa. 

Mr. Cunningham. No, sir, he certainly did not. Senator. He cer- 
tainly did not. 

Senator Ervin. I thought you said he told you that later. 

Mr. Cunningham. No ; he did not. 

(The witness conferred with his counsel.) 

Mr. Cunningham. That referred to the hotel bills, Senator. 

Senator Ervin. Then I misunderstood you. You said that when 
he gave you the $2,500, he didn't tell you anything about its source, 
and you didn't have enough curiosity to ask about the source ? 

Mr. Cunningham. I welcomed it. 

Senator Ervin. I say you said when he gave you the $2,500, that 
he gave you no information as to where he had obtained it? 

Mr. Cunningham. No ; he did not. 

Senator Ervin. And you didn't have enough curiosity to ask him 
where he got it ? 

Mr. Cunningham. No : I did not. 

Senator Ervtn. You didn't even want to know to whom you ought 
to have a feeling of gratitude for the assistance they gave you? 

Mr. Cunningham. My gratitude was to Moss Herman, Senator. 
He had done this before, and he went out and raised $2,000 before. 

Senator Ervin. You knew it didn't come from him, though, didn't 
you, out of his personal funds ? 

Mr. Cunningham. I think if need be, Moss Herman could have 
raised that himself. 

Senator Ervin. Well, if he had it in his pocket, he wouldn't have 
had to raise it, would he ? 

Mr. Cunningham. That is true. 



IMPROPER ACTIVITIES IN TttE LABOR FIELD 16137 

Senator Ekvin. Did you think when he gave you that $2,500 that 
he was giving you money which belonged to him ? 

Mr. Cunningham. No ; I did not. 

Senator Ervin. And you didn't have any curiosity about where it 
came from, and you didn't even want to know who you ought to be 
grateful to for making the contributions to Moss Herman ? 

Mr. Cunningham. Senator, I was very thankful to Moss Herman. 

Senator Ervin. Now, let us see if I understood what later happened. 
You were told by him later that the money or at least part of the 
money that was being used to pay your hotel bills came from the 
personal funds of Jinuny Hofi'a. 

Mr. Cunningham. Yes; I have testified to that. Senator. 

Senator Ervin. And you also testified that he told you that Jimmy 
Hoffa didn't know that the money was being used for that purpose. 

Mr. Cunningham. I believe that is what is in my statement. 

Senator Ervin. Can you explain to this committee how it happened 
that Moss Herman may have been using the personal funds of Jimmy 
Hoffa to pay your hotel bill, without the knowledge or consent of 
Jimmy Hoffa ? 

(The witness conferred with his counsel.) 

Mr. Cunningham. Senator, I believe my testimony shows, and it 
certainly reflects in here in the statement that I have given to you, that 
when I did find out that Jimmy HofFa had anything to do with this, 
we certainly had quite a fracas. 

Senator ER^^N. That is not quite answering my question. Did you 
ever inquire of Moss Herman how it happened that he was using 
Jimmy Hoffa's personal funds to pay your hotel bill without the 
linowledge of Jimmy Hoffa ? 

Mr. Cunningham. I can't explain Mr. Herman's actions. 

Senator Ervin. Didn't that statement of Moss Herman's to that 
effect strike your mind as being what you call in the most polite lan- 
guage something which was rather improbable ? 

Mr. Cunningham. How do you refer to "improbable," Senator? 

Senator Ervin. Don't you think it is very improbable that an honest 
man would take the personal funds of another, and use them for some 
purpose of which the other was ignorant without his knowledge? 

Mr. Cunningham. I can't account for Moss Herman's actions, Sen- 
ator, and I can only account for my own, and when I found it out I 
certainly was very put out at it, and my counsel was very exceed- 
ingly put out. 

Senator Ervin. To my way of thinking, if one man takes the per- 
sonal funds of another man without his knowledge or consent and 
uses them for any purpose, that he is committing the crime of em- 
bezzlement. 

Mr. Cunningham. I can't account for him. 

Senator Ervin. Didn't that strike you as a very peculiar kind of 
a story, something that might have come out of "Alice in Wonder- 
land," rather than out of the "Book of Truth ?" 

Mr. Cunningham. T^Tien I found out, Senator, I just walked away 
from the whole thing and I was ready to stop everything right that 
minute. I have no desire to be hooked up in anything, and I came 
in here of my own volition, and I want to talk, and I want to tell the 
whole story and I have nothing to hide, and I want the story brought 
out. 



16138 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Senator Ervin. I am not complaining of your hiding anything, 
and what I am complaining is on your own statement being totally 
devoid of that very natural human trait which we call curiosity. 

Mr. Cunningham. It more than aroused my curiosity. 

Senator Ervin. But you sought no satisfaction for your curiosity 
because you didn't bother to ask him how it happened that he was 
using another man's money without the other man's knowledge or 
consent. 

(The witness conferred with his counsel.) 

Senator Ervin. That is all. 

Mr. Kennedy. I think we will have some testimony quite to the 
contrary. 

The Chairman. Proceed. Did you want to make a staetmenl ? 

Mr. Cunningham. No. 

The Chaiirman. Mr. Cunningham, if I understand you correctly, 
when you learned from Mr. Herman that you were actually getting 
money from Jimmy Hoffa, you resented it and became upset about it. 

Mr. Cunningham. I did. 

The Chairman. Wliy? 

Mr. Cunningham. No. 1, it would have a terrific reflection. I talked 
this over with my lawyer, and it could reflect in the court, and as far 
as legal technicalities are concerned they would have ramifications of 
which I am just not capable of talking about, and I mean they are 
too technical for me to talk about. 

Secondly, I wouldn't take any of Jimmy Hoffa's money, and I have 
been fighting Jimmy Hoffa, and I still am, and I am going to continue 
to fight him. 

The Chairman. Did you get this information before you prepared 
this written statement ? 

Mr. Cunningham. Oh, yes ; it reflects it in here. 

The Chairman. I see it does. I just want you to turn to page 22. 
I read it, and you follow me, please. Right in the middle of the page 
it says : 

I am not employed by Mr. Hoffa, and I am not employed by the international 
or any of its affiliates. I have never taken any money from Mr. Hoffa or solicited 
any from him. If he offered me any, however, in my present position, I would 
certainly accept it and can see no reason either legally or morally why I should 
not. 

In the face of that statement, I can't quite reconcile your resentment 
of his having provided you some money, when you learned about it. 

Mr. Cunningham, I refer to my present jjosition right there. 

The Chairman. What is that ? Are .you saying that you would ac- 
cept it today although you got mad about it 2 weeks ago ? 

Mr. Cunningham. I did as far as the case was concerned; I cer- 
tainly did. 

The Chairman. I am not talking about the case, and this is your 
statement, voluntarily made, and you hadn't been asked about it, but 
you say here that you hadn't gotten any money from him, but if you 
got the chance obviously you would certainly take it and be glad to 
get it. 

And then I couldn't reconcile that with your testimony just a few 
moments ago, when you were highly resentful when you first learned 
you had been getting money from Hoffa. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16139 

Mr. W1LJ.1AMSOX. Mr. Chairman, he consulted with me witli refer- 
ence to that particular aspect of this, and may I just for a moment talk 
to Mr. Cunningham ? 

The Chairman. You may talk to him. 
(The witness conferred with his counsel.) 

The Chaiuman. All right, is there any further explanation of it? 
You may proceed. 

Mr. Kennedy. But as I understand, you are against Mr. Hoffa now, 
Mr. Cunningham ? 

Mr. Cunningham. Yes ; I am. 

Mr. Kennedy. You feel very strongly about it ? 

Mr. Cunningham. I feel very strongly about the case that I started. 

Mr. Kennedy. And against Mr. Hoii'a and the way he is running 
the union ? 

Mr. Cunningham. No. 

Mr. Kennedy. You don't have any feeling against him ? 

Mr. Cunningham. I don't regard Mr. Hoffa in any way, shape, or 
manner. 

Mr. Kennedy. You do not and you don't have anything against Mr. 
Hoffa? 

Mr. Williamson. I would like to refer to the statement for just a 
moment. 

Mr. Kennedy. I think you might refer to page 20. I understood 
Mr. Cunningham just to make a statement that he was fighting Mr. 
Hoffa, and then I see something on page 20. Do you want to read that? 

Mr. "Williamson. Read the first paragraph of your statement. 

Mr. Cunningham. It is not my ambition and it has never been my 
ambition to injure the Teamster movement. I have been a member 
for many years, and I consider that a strong union is vital to we 
working people. Similarly, I should make it plain that I am neither 
for nor against Mr. James Hoffa. I was opposed to the tactics of the 
old board under Beck, but do not consider that a sufficient time has 
elapsed for Mr. Hoffa to have demonstrated how he would run the 
union, even without the intervention of the monitors, and clearly they 
have prevented his rimning the organization as he is responsible for 
doing as president. 

Certainly the refusal of the monitors to permit him to continue the 
termination of the trusteeships, always the principal control device 
by the "ins," after he had demonstrated his intent to end all such 
trusteeships, seems utterly ridiculous to me. 

Mr. Kennedy. So you have nothing against Hoffa or his operations 
of the union, or his operat ions in the past ; is that correct ? 

Mr. Cunningham. I didn't say that. 

Mr. Kennedy. I think that he can answer, Mr. Williamson. 

Mr. Cunningham. I am answering. 

Mr. Kennedy. I am asking you now if you have anything against 
Mr. Hoffa. 

Mr. Cunningham. I don't know Mr. Hoffa. 

Mr. Kennedy. You have no action or you don't want to take any 
action against Mr. Hoffa, and you would like to let him remain in as 
president of the union ? 

Mr. Cunningham. That is not so. 

Mr. Kennedy. I am just asking you. 



16140 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Cunningham. No. I don't care to let him remain in as presi- 
dent of the union. 

Mr. Kennedy. Do you feel that he is a proper person to be president 
of the union ? 

Mr. Cunningham. Well, I would have to reserve an answer on that, 
until we find out all of the stuff. All I know is what I read in the 
newspapei^. 

Mr. Kennedy. I think we will make the record of the committee 
available to you, Mr. Cunningham, if you want to see it. Let me just 
get straightened out about the $2,500. When did vou receive the 
$2,500? 

Mr. Cunningham. I believe I testified to that. 

Mr. Kennedy. I want to get the dates straight. 

Mr. Cunningham. I believe I told you December 9. 

Mr. Kennedy. December 9, 1958; you turned it over to Mr. Wil- 
liamson about that time ? 

Mr, Cunningham. The same day. 

Mr. Kennedy. And the $800 came from Mr. Moss Herman on what 
day? 

Mr. Cunningham. Sometime in the latter weeks of September 1958. 

Mr. Kennedy. And you had the conversation with Moss Hennan 
about the fact that your bills were being paid by the Teamsters some- 
time during January of this year ? 

Mr. Cunningham. Of this year, and it would either be the last of 
December or the first of January, and it was in that few days. 

Mr. Kennedy. Have you ever visited Mr. Hoffa at the Teamsters 
headquarters ? 

Mr. Cunningham. Yes, I have. 

Mr. Kennedy. How many times have you visited him there? 

Mr. Cunningham. Do I refer to it here? 

Mr. Kennedy. I don't know, and I just want the truth. 

Mr. Cunningham. I have been in the Teamster headquarters. 

Mr. Kennedy. How many times have you visited Mr. Hoffa at the 
Teamster headquarters ? 

Mr. Cunningham. Four or five times. 

The Chairman. Mr. Cunningham, if I am not mistaken, just 5 
minutes ago you said that you didn't even know Mr. Hoffa ; is that not 
correct ? 

Mr. Cunningham. I didn't know anything about him. What is my 
statement, and I didn't say I didn't know Mr. Hoffa. 

The Chairman. Of course, the record, the official reporter has, and 
as I recall you said you didn't even know Mr. Hoffa. I could be mis- 
taken, but I think that that is what you said. 

Mr. Cunningham. Well, I don't intend it to mean that I know him 
as a person, to intimately know him. I am not trying 

The Chairman. Just go ahead and straighten it out and tell us how 
well you know him. 

Mr. Cunningham. Not very well. I have gone "ver to him with 
my problems. 

The Chairman. You have ? 

Mr. Cunningham. Yes, sir; I have. 

The Chairman. How many times ? 

Mr. Cunningham. Four or five times. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16141 

The Chairman. Problems regarding this litigation? 

Mr. Cunningham. No, sir. 

The Chairman. Personal problems? 

Mr. Cunningham. Personal problems. 

The Chairman. About what ? 

Mr. Cunningham. About my getting back my job in New York 
City, and the refusal of local 584 to do anything about arbitration, 
which I am entitled to under our contract. 

The Chairman. When was your last visit to him ? 

Mr. Cunningham. Within the past month. 

The Chairman. These visits, have they been during the past year ? 

Mr. Cunningham. They have been since approximately September 
of 1958. 

The Chairman. Since September of 1958 ? 

Mr. Cunningham. That is right. 

The Chairman. All right. 

Mr. Kennedy. Did you discuss Mr. Godfrey Schmidt when you 
visited Mr. Hoffa ? 

Mr. Cunningham. Yes, sir ; I did. 

Mr. Kennedy. Did you discuss the cases you had against Godfrey 
Schmidt? 

Mr. Cunningham. No. 

Mr. Kennedy. Did you discuss the fact he had not given you an 
accounting ? 

Mr. Cunningham. Just a clarification on it, no, and you didn't 
give me a chance on that. I originally was asked by the lawyers, and 
they had learned that I intended litigation against Godfrey Sclimidt, 
and they asked me how broad a scope my litigation was. 

Mr. Kennedy. Who asked you this ? 

Mr. Cunningham. I believe that was in the room, it was at Team- 
ster headquarters. 

Mr. Kennedy. Who asked you ? 

Mr. Cunningham. I believe there was George Fitzgerald, and I 
believe there was Edward Cheyfitz, and somebody represented himself 
as a lawyer, Maheu, or something like that. 

Mr. Kennedy. Bob Maheu? 

Mr. Cunningham. Yes, sir. 

Mr. Kennedy. He is an investigator ? 

Mr. Cunningham. Yes, sir. 

Mr. KJENNEDY. When did you have that conversation ? 

Mr. Cunningham. Mr. Hoffa came into the room, too. 

Mr. KJENNEDY. "What did they want to find out from you at that 
time? 

Mr. Cunningham. They wanted to know about Godfrey Schmidt, 
and his accepting money from management. 

Mr. Kennedy. Is that the first time that you met Mr. Hoffa? 

Mr. Cunningham. Yes. 

Mr. Kennedy. That was the first time ? 

Mr. Cunningham. Yes. 

Mr. Kennedy. Who called you over ? 

Mr. Cunningham. Moss Herman. 

Mr. Kennedy. He was there also ? 

Mr. Cunningham. Yes, sir, he was there. 



16142 IMPROPER ACTIVITIES EST THE LABOR FIELD 

Mr. Kennedy. And he had been requested b}^ Mr. Hoffa to come 
over there? 

Mr. Cunningham. I don't know that, and I don't know who re- 
quested him, and I also brought a lawyer in. 

Mr. KJENNEDY. Wlio did you bring ? 

Mr. Cunningham. Mr. Edward Raff. 

Mr. Kennedy. That is another lawyer ? 

Mr. Cunningham. Yes, sir. 

Mr. Kennedy. Wlio paid Mr. Raff ? 

Mr. Cunningham. He forsook it and he didn't see any money 
in it. 

Mr. Kennedy. Wlien was the second time you went over to see Mr. 
Hoffa? 

Mr. Cunningham. I don't have the exact dates on that, and I 
couldn't be pinned down and I wouldn't want to be pinned down. 

Mr. Kennedy. TVliat did you discuss the second time ? 

Mr. Cunningham. My case in New York City. When I say "my 
case," I mean the case against 584. 

Mr. Kennedy. Did you discuss also the litigation that you were 
bringing against Mr. Schmidt for the removal of Mr. Schmidt? 

Mr. Cunningham. Well, I would like again to refer to exactly 
what Mr. Hoffa has to say about me and my litigation. 

Mr. Kennedy. I was just trying to find out the answers to these 
questions. 

When you went over to visit Mr. Hoffa again, did you discuss with 
him the litigation that you had or the removal of Godfrey Schmidt? 

(The witness consulted with his counsel.) 

Mr. Kennedy. If you just tell the truth, you don't have to look at 
your statement, just tell the truth. 

Mr. Cunningham. I have sworn to this statement already, Mr. 
Kennedy, and that is the truth. 

Mr. Kennedy. You won't have any trouble just telling us the truth 
again, and you don't have to look up and find out what you wrote 
down. 

The Chairman. I don't know whether that is in the statement or 
not, but the question is simply, did you discuss with Mr. Hoffa, the 
second time you went to see him, the case you had against Mr. Godfrey 
Schmidt? 

JNIr. Cunningham. Not the second time, no. I discussed what could 
be done to take action to get my arbitration working in New York 
City. 

The Chairman. That is what you discussed the second time you 
went to see him ? 

Mr. Cunningham. That is right. 

The Chairman. You didn't discuss your litigation down here with 
Mr. Schmidt, did you? The question is, did you or didn't you? 

(Witness conferred with his counsel.) 

Mr. Cunningham. I just don't recall it. 

The Chairman. iVll riglit. 

Mr. Kennedy. Who was at that meeting? 

Mr. Cunningham. Myself. 

Mr. Kennedy. Just you and Mr. Hoffa ? 

Mr. Cunningham. That is right. 



IMPROPER ACTIVITIES EN THE LABOR FIELD 16143 

Mr. Kennedy. Nobody else was present during any part of it? , 

Mr. Cunningham. No, sir. 

Mr. Kennedy. Then when you went back to see Mr. Hoffa a third 
time, who was present at that meeting ? 

Mr. Cunningham. I haven't had anyone with me when I talked tO 
Mr. HofFa. 

Mr. Kennedy. Just you and Mr. Hoffa ? 

Mr. Cunningham. That is right. 

Mr. Kennedy. Did you discuss then your litigation for the removal 
of Mr. Schmidt? 

Mr. Cunningham. I may have, and I just don't recall. I know 
he at one time told me, "Tlie best thing you can do is get yourself back 
on tliat truck again. You and your litigation are crazy, and you are 
crazy, too.'' 

Mr. Kennedy. Did you discuss your action in connection with Judge 
Letts, and did you discuss that with Mr. Hoffa ? ■'■) 

Mr. Cunningham. No, sir. , 

Mr. Kennedy. You never mentioned that ? 

Mr. Cunningham. No, sir. 

Mr. Kennedy. You never brought that up at all ? 

Mr. Cunningham. No, sir. 

Mr. Kennedy. Who was present at any of these other meetings;, 
other than this first meeting where you mentioned Mr. Cheyvitz was 
present ? He is the attorney for the Teamsters. 

Mr. Cunningham. I have already testified to that. 

Mr. Kennedy. Was there anybody present at any of these other 
meetings ? 

Mr. Cunningham. No, sir. 

Mr. Kennedy. Mr. Cheyvitz was the attorney for the Teamsters? 

Mr. Cunningham. I don't know whether he is an attorney or not, 
and I met him originally around January when the consent decree 
was entered, and he is a redheaded little guy. 

Mr. Kennedy. How many times have you talked to him ? 

Mr. Cunningham. A few times. 

Mr. Kennedy. How many times ? 

Mr. Cunningham. Well, I talked to Mr. Cheyvitz in January con- 
cerning the consent decree a couple or three times, I would say. 

Mr. Kennedy. How many times have you talked to him since 
August or September of 1958 ? 

Mr. Cunningham. I just talked to him that 1 day. 

Mr. Kennedy. Just that 1 day ? 

Mr. Cunningham. That is right. 

Mr. I^nnedy. You never had any conversations with him? 

Mr. Cunningham. I never have seen him again, I don't think. ( 

Mr. Kennedy. 'Wliat about Mr. Williams ? 

Mr. Cunningham. Yes, I went over to their office, that is correct. 
You are right on that one. 

Mr. Kennedy. I am not right. I am just asking you. 

Mr. Cunningham. I am glad you brought that up. 

Mr. Kennedy. Thank you. 

^Ir. Cunningham. Because the following day, I did go with Mr. 
Raff and Joseph Lobruto, an attorney from New York City, who 
was in Godfrey Schmidt's office, and I think Moss Herman was there, 



16144 IMPROPER ACTIVITIES IN THE LABOR FIELD 

too, and we went over to Ed Williams' office and he wanted to know 
about Mr. Bulware, of General Electric, and he wanted to know about 
the management's side of it, who had made contributions. 

Mr. Kennedy. This was after your conversation at the Teamster 
headquarters ? 

Mr. Cunningham. That is correct. 

Mr. Kennedy. Were you ever over there other than that occasion ? 

(The witness conferred with his counsel.) 

Mr. Cunningham. This morning I flew down with Ed Williams 
on the plane this morning, and he sat two or three seats back of me. 

Mr. Kennedy. Were you ever there on any other occasion, over at 
their office ? 

Mr. Williamson. Whose office ? 

Mr. Kennedy. Mr. Williams' office. 

Mr. Cunningham. The last time I was in Mr. Williams' office is 
the date that I referred to. I am pretty sure of that, to the best I 
can recall. 

(The witness conferred with his counsel.) 

Mr. Williamson. May we have just a moment, please? 

(The witness conferred with his counsel.) 

Mr. Cunningham. On one occasion Mr. Hoffa asked me what this 
litigation w^as about where I have gone to the court of appeals and 
I told him at that time that the best thing he could do was talk to 
Mr. Williamson. 

Mr. Kennedy. When was that ? 

(The witness conferred with his counsel.) 

Mr. Cunningham. It was shortly after this case was filed, which 
would have been approximately around the 10th, and it was in the 
corridor of the Woodiier Hotel. 

Mr. Kennedy. Did you ever go to Mr. Hoffa's apartment at the 
Woodner Hotel ? 

Mr. Cunningham. Yes, I did ; once. 

Mr. Kennedy. Did you visit Mr. Hoffa there ? 

Mr. Cunningham. Yes. 

Mr. Kennedy. Who else was there ? 

Mr. Cunningham. No one was there. 

Mr. Kennedy. Just you and Mr. Hoffa. 

Mr. Cunningham. That is right. 

Mr. Kennedy. Did you ever see Mr. Gibbons there ? 

Mr. Cunningham. No. 

Mr. Kennedy. Do you know Mr. Gibbons ? 

Mr. Cunningham. I would know him if he walked into this room. 

Mr. Kennedy. Did you ever have any convei-sations about these 
matters with Mr. Gibbons ? 

Mr. Cunningham. No ; I did not. 

Mr. Kennedy. Tell me this : When Moss Herman told you that the 
hotel bills were being paid by Jimmy Hoffa, did you ask him about the 
$2,500, then, who was paying that $2,500 ? 

Mr. Cunningham. Yes, I did, and he assured me it didn't come 
from that source. 

Mr. Kennedy. Did he tell you where it came from ? 

Mr. Cunningham. He just said, "It did not come from that source, 
and it did not come from any teamster." He said, "That I will 
swear on my life, Jack. I did not get it from any teamster." 



EtfPROPER ACTIVITIES IN THE LABOR FIELD 16145 

Mr. Kennedy. Did you find out where it came from? 

Mr. Cunningham. I haven't found out to this day wliere it came 
from. 

Mr. Kennedy. Did you ask where it came from ? 

Mr. Cunningham. Yes, I did, and he said, "Jack, I am telling you^ 
where this money came from you won't get hurt." 

Mr. Kennedy. Why didn't he tell you that ? 

Mr. Cunningham. He just refused to tell me. He refused to this 
minute. 

Mr. Kennedy. And the $800 ? 

Mr. Cunningham. I know the $800. 

Mr. Kennedy. Where did that come from ? 

Mr. Cunningham. His son-in-law got a loan for approximately 
$500, and $300 came from Harry Matinsky. He is also of the milk 
waofon drivers. He was a recording secretaiy of local 584. 

Mr. Kennedy. And $300 came from him and $500 came from 

Mr. Cunningham. From the bank, on a loan, on a long-range loan, 
on which I am paying him back $20-odd a month. 

Mr. Kennedy. When did you find that out ? 

Mr. Cunningham. He did it for me. 

Mr. Kennedy. When did you find out where that $800 came from? 

Mr. Cunningham. At the time it happened. I got him to do it. 

Mr. Kennedy. Did you ever have any conversations with Mr. Hoffa 
about the fact that you would take over a local or he would arrange 
for you to become an officer of a local ? 

Mr. Cunningham. Absolutely not. 

Mr. Kennedy. Did you ever have any discussion at all about your 
obtaining some position in New York in the Teamsters Union? 

Mr. Cunningham. No. 

Mr. Kennedy. Did you ever talk to anybody from Joint Council 16 
about joining in this litigation ? 

Mr. Cunningham. Yes ; I did. 

Mr. Kennedy. Who did you talk to from Joint Council 16 ? 

Mr. Cunningham. Well, of course, Mr. Distinti brought it on the 
floor. That was first introduced on the floor of a regular meeting of 
Joint Council 16, and a resolution was passed. I just don't know what 
the resolution was, but I know I was told by Mr. Distinti that it was 
unanimously approved that they should enter into this litigation. 

Mr. Kennedy. That was to eliminate the monitors ; is that correct ? 
That was in 

Mr. Cunningham. That is the court of appeals case. 

Mr. Kennedy. That is the litigation of Cunningham versus Letts. 

Mr. Cunningham. That is right. 

Mr. Kennedy. And Joint Council 16, headed by John O'Eourke, 
was going to join you in that litigation ? 

Mr. Cunningham. Yes ; he was. 

Mr. Kennedy. Didn't you know the relationship, the close personal 
relationship, that exists between John O'Rourke and Mr. Holf a ? 

Mr. Cunningham. Mr. Kennedy, there are 140,000 or 150,000 men 
up there in Joint Council 16. John O'Rourke is 1 out of 140,000. 

Mr. Kennedy. No. He is one a little bit more important than that. 
He is president of Joint Council 16. 

Mr. Cunningham. That is right. 



16146 IMPROPER ACTIYITIES IN THE LABOR FIELD 

Mr. Kennedy. Did you know of that relationship when Joint Coun- 
cil 16 said that they would join you in this litigation? 

Mr. Cunningham. Joint Council 16 can do anything they want to 
do. I can't stop them from doing it. 

Senator Ervin. Mr. Kennedy has put the same simple question to 
you twice, and you go off on a tangent. 

Mr. Cunningham. No ; I don't try to, Senator. 

Senator Ervin. He has put the question to you twice, a very simple 
question : If you knew at that time of the close personal relationship 
that existed between O'Rourke and Hoffa. That is a very simple 
question. 

Mr. Cunningham. Yes, I know of the relationship. He is the vice 
president of the general executive board and a defendant in the action. 

Mr. Kennedy. Didn't it arouse your curiosity as to why joint coun- 
cil 16 would enter into this litigation with you ? 

Mr. Williamson. Mr. Chairman, may I say in that regard that I 
think this is an invasion of the lawsuit. We urge that it is a good 
lawsuit, and they wanted to join it because they think it has merit 
and we should prevail. 

Mr. I^nnedy. I will tell you why this is of interest to us. We 
have on one hand the Teamsters Union president, at least as to the 
testimony so far, financing, at least in part, Mr. Cunningham's suits 
in the court of appeals. We have Mr. John O'Rourke and joint coun- 
cil 16 joining in that suit on one side. 

Mr. Dickey. Joint council 16 has not joined in that suit and is not 
a party petitioner in that suit. 

Mr. Ivennedy. Indicating they would join. We have on the other 
hand Teamster Union funds used to finance Mr. Edward Bennett Wil- 
liams to fight the suit for the International Brotherhood of Teamsters. 

It is the most inconsistent situation that has ever existed. The 
Teamster Union funds are being used on both sides of the litigation. 

Mr. Williamson. Mr. Chairman, since the counsel for the commit- 
tee has, in the absence of an oath, been able to make a statement, that 
I believe reflects upon the integrity of both Mr. Dickey and myself 
concerning the motivation for this suit, may I very, very briefly ex- 
plain to you and to your committee now how we feel about this ? 

The Chairman. I have no objection to an explanation. I don't 
understand that it reflects, that any statement he made reflects upon 
you gentlemen. 

Mr. Williamson. We feel that it does. We are working lawyers, 
we are trial lawyers. We feel that the suit we have filed in the court 
of appeals has merit as a matter of law. We have researched it very, 
very thoroughly, and we would be complimented to know that some 
of you may have read our brief. 

We don't know much about the internal politics of the Teamsters. 
We do know that we have a good law suit, and we have read of your 
work. We feel that our goal should be the goal of this committee, 
that is, that there be an early convention, an honest election, and cer- 
tain of our clients have assured us that under those circumstances 
they might beat Mr. Hoffa. This we do not know. 

The suggestion by counsel that Mr. Dickey and I would be in a 
position of taking money in a ]3atsy suit or one where somebody is 
rolling over, we do consider to be a reflection upon us, and we quite 
frankly do not like it. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16147 

Mr. Kennedy. I will tell you what 

The Chairman. Just a moment. 

We have a witness here who is testifying, and we have a lot of 
litigation going on. There is some indication, some evidence at least, 
that his litigation, although against certain interests, is being financed 
at least in part by Mr. Hoffa, president of the International. 

There apparently is a conflict of interest. You have the Interna- 
tional Union, the Teamsters Union, interested on both sides of the 
litigation. If that is true, it is something that is most unusual. 
Counsel could be wholly innocent; he could not know that. You may 
be learning something from this testimony. 

Mr. Williamson. If I may, Your Honor 

The Chairman. There is no intention of reflecting upon you, but 
there is an intention of developing this record to show what may be 
behind some of this litigation. 

Mr. Williamson. If I may suggest for the record if the fact that 
the Teamster International or the IBT, however you describe them, 
has a goal or a desired end that is consistent with the desired end of 
our client, creates some doubt of the validity of our litigation, then 
the theory of guilt by knowledge has been expanded, because ob- 
viously 

The Chairman. We are only trying to get information as to the 
activities. 

Senator Erm;n. Mr. Chairman, I see nothing here as far as counsel 
goes. There is no evidence that Mr. Dickey or Mr. Williamson have 
any knowledge of these matters or have any knowledge of the source 
of the $2,500, or any knowledge of these other matters. 

Mr. WiLLLVMSON. We are concerned, however, if it please the chair- 
man, that there be some thought of impropriety in the mind of counsel 
for this committee or a member of this committee, that because our 
goal is the holding of a convention and election of officers under the 
constitution, and at the same time perhaps the International wants 
this, and we don't know whether they do or not, that this should char- 
acterize our lawsuit as being shady in any sense, because we are quite 
proud of it. 

The Chairman. You say that is your goal. The other side may 
have a goal of disrupting, preventing, and thwarting an honest elec- 
tion. I do not know. That is why we are trying to get the facts out 
here. 

Mr. Willl\mson. I think they do have. I think you have devel- 
oped that. 

The Chairman. I don't see how they can hold both positions con- 
sistently. 

Mr. Williamson. If they are trying to thwart the holding of an 
election, they have been successful since January 1, 1958. 

Mr. Ejennedt. The International Brotherhood of Teamsters has 
taken one position, publicly, with their attorney, Mr. Williams, taking 
an opposite point and, according to the testimony of Mr. Cunning- 
ham, financially has taken a contrai-y position by at least the su')port 
in part of Mr. Cumiingham's suit. 

Mr. Williamson. They have only paid a few dollars for his hotel 
bills, and when we heard of this, we told Mr. Cmmingliam it shoidd 
stop. I do not see the impropriety of it, but I do not like it. 

The Chairman. Why did you tell him to have it stopped ? 



16148 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Williamson. Because I didn't want him to have anything to 
do with the other side. I told him not to talk to them, but if tliey 
wanted to discuss the case, to discuss it with me, and I will tell you 
quite frankly I have discussed it with them. 

The Chairman. I think it is quite proper, the advice you have 
given. Proceed. 

Mr. Kennedy. How many times has your attorney discussed the 
matter with Mr. Hoffa? 

Mr. Cunningham. I don't know. Ask him. 

Mr. Williamson. I am quite willing to tell you. 

Mr, Kennedy. You don't know how many times, Mr. Cimning- 
ham? You don't know how many times he has visited Mr. Hoffa 
about this litigation ? 

Mr. Cunningham. No ; of course not. 

Mr. Kennedy. So if he has visited Mr. Hoffa, it has been without 
your knowledge? 

Mr. Cunningham. No. 

Mr. Kennedy. Then how many times has he visited ? 

Mr. Dickey. Mr. Chairman, that is not a fair question. He says 
he doesn't know. 

The Chairman. Do you know if he has visited Mr. Hoffa? 

Mr. Cunningham. Yes. He told me he has. He served him with 
papers. That I know. So you must classify that as a visit, if you 
serve a man with papers. If you go down and 

The Chairman. All right. If you will let me, I will help you. 

Mr. Cunningham. I am sorry, sir. 

The Chairman. You know at least of one time, or at least you have 
been told of one time when your counsel served Mr. Hoffa with 
papers. 

Mr. Williamson. May I suggest that I have been there at least a 
half dozen times ? 

The Chairman. Well, all right. I am trying to get a record here. 

I say, you said that you know of one time, at least, or at least you 
have been told of one time that your counsel visited Mr. Hoffa when 
he went down and served papers on him ; is that correct ? 

Mr. Cunningham. Yes. 

The Chairman. Now, then, do you know of any other time, have you 
been told of any other time, or do you know of any other time that your 
counsel may have visited Mr. Iloft'a ? 

(The witness conferred with his counsel.) 

Mr. Cunningham. He picked up records and he served some papers. 
There was more than one ser\'ice. 

The Chairman. Do you know how many? I just ask you now: 
Do you know how many times ? Either you do or you don't. 

(The witness conferred with his counsel.) 

Mr. Cunningham. I guess a total, maybe, of five times. 

The Chairman. That is information that you have received from 
your attorney about it; so far as your being with him and actually 
knowing he went there, you do not know ? 

Mr. Cunningil\m. That is correct. 

The Chairman. Or were you with him when he went there? 

Mr. Cunningham. No. 

The Chairman. You understand tliat he has been there some five 
times, maybe, to see him ; is that correct ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16149 

Mr. Cunningham. That is correct. 

The CiiAiKMAN. All right ; proceed. 

Mr. Kennedy. That is all. 

The Chairman. Is there anything further ? 

All right, this witness may stand aside for the moment. 

Mr, Williamson. Mr. Chairman, we have certain records here. On 
the subpena, we are willing to do anything with them that you wish. 

The Chairman. What are they ? 

Mr. Williamson. An income tax return, his complaint before the 
New York State Labor Board, a letter from Mr. Lukins with reference 
to a contribution made to Mr. Smith. 

The Chairman. Those papers may be turned over to the clerk and 
she will give you a receipt for them. 

Mr. WiLLiA:jrsoN. And they will be made a part of his testimony ? 

The Chairman. Well, we will have to look at them. Do you desire 
to have them made exhibits ? 

]\Ir. Williamson. We would at this time — well, I don't want to get 
into a personal dispute before this conmiittee with Godfrey Schmidt, 
quite frankly. We would, however, like to have in the record a full 
explanation of the posture within which Mr. Cunningham 

The Chairman. Why don't you turn the papers over to the clerk? 
She will give you a receipt for the papers. The coimnittee will exam- 
ine the papers and will then act upon any request that counsel cares to 
submit. 

Mr. Dickey. Mr. Chairman, may I ask one question, please, sir ? 

The Chairman. Yes, sir. 

Mr. Dickey. As Mr. Williamson has indicated, we have an argu- 
ment set in the court of appeals, U.S. court of appeals, for this 
circuit, on Friday morning at 10 :45. This subpena of Mr. Cunning- 
ham's was received by him, I think, on Thursday, on Wednesday, of 
last week as a forthwith subpena. 

We then consulted with Mr. Kennedy on Friday, or Thursday, and 
told to be here Tuesday. I know that you, as a good lawyer, and 
Senator Ervin also, know that it is a rather difficult problem for a 
lawj-er to prepare an argument in the court of appeals. 

Is it possible that ultimately this witness might be excused mitil 
after this case so that we can get to work? 

The Chairman. He is here in town, isn't he ? 

Mr. Cunningham. Yes, I am. 

The ChaiR'Man. You go ahead and go to work. We will let you 
know if we need you. We will try not to use you before the case is 
over. 

Mv. Dickey. Thank you very much, Mr. Chairman. 

The Chairman. We do the best we can in these cases to try to ac- 
commodate people, but we have a problem, too. 

All riglit, call the next witness. 

]Mr. Kennedy. Mr. Tierney, Mr. Chairman. 

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. Tierney. I do. 

36751— 59— pt. 43 14 



16150 IMPROPER ACTIVITIES EST THE LABOR FIELD 

TESTIMONY OF PAUL J. TIEENEY 

The Chairman. Your name is Paul Tierney ? 

Mr. Tierney. That is correct, Senator. 

The Chairman. You are a member of the staff of this committee? 

Mr. Tierney. I am. 

The Chairman. All right, Mr. Kennedy ; proceed. 

Mr. Kennedy. Mr. Tierney, have you secured certain of the hotel 
records at the Woodner Hotel in connection with JNIr. Moss Herman 
and John Cunningham ? 

Mr. Tierney. I have. 

Mr. Kennedy. Would you relate to the committee what those rec- 
ords show and who paid the hotel bills for those two individuals ? 

Mr. Tierney. With respect to Mr. Cunningham, the records show 
that he was at the Hotel Woodner on August 28-29, 1958, at which 
time he incurred charges of $8.76. The folio reflects that the charge 
was transferred to A-1109, the room number. A-1109 at the time was 
occupied by Mr. Moss Herman. 

The records further indicate that this charge, plus additional 
charges of Mr. Herman, totaling $65.54, were transferred to a ledger 
whicTi is a ledger of the Teamsters Union, 2741 Trumbull, Detroit, 
Mich. Those charges were in turn, paid by the Teamsters. 

Mr. Kennedy. ^Vliich is the headquarters of local 299 in Detroit? 

Mr. Tierney. That is correct. 

Mr. I^nnedy. And that is Mr. Hoffa's local; is that correct? 

Mr. Tierney. That is correct. 

The Chairman. In other words, the hotel bill of both Mr. Cun- 
ningham and Mr. Herman were ultimately paid by the Teamsters? 

Mr. Tierney. That is correct, sir. 

Mr. Cunningham was at the Woodner again on September 8 and 9, 
1958. Charges were $12.56. The folio indicates '''Bill to Moss Her- 
man, A-1149," his room number, and after that "Union, TEA,"' 
Union Teamsters, I imagine, is what that means. 

Thereafter, he was at the hotel on September 18 and 19, 1958. 
Charges were $4.12. There is a notation on that particular folio 
reading "To Herman, 1149," which is his room number. As far as 
those bills are concerned, we will have testimony later on. 

Mr. Kennedy. Just go into what information we have and then we 
will have another witness. 

The Chairman. What is that? 

Mr. Kennedy. In connection with the bills. They were handled 
in a rather peculiar manner. 

Mr. Tierney. These particular bills, Senator, were transferred to 
Mr. Herman's ledger or folio. He was responsible for them. Mr. 
Herman's bill, in turn, was transferred to the Teamster ledger. How- 
ever, we have determined that, actually, these two bills of Mr. Cun- 
ningham's, this $12.56 plus $4.12, plus an additional $4.12, was paid 
in cash by Mr. Harold Gibbons and at Mr. Gibbons' insistence. 

Mr. Kennedy. We will put tliat in through another witness. The 
only point in connection with that particular one is to demonstrate 
or indicate and show that the Teamsters were well aware of the fact 
that these bills were being paid. 

Go ahead. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16151 

Mr. TiERisrEY. Mr. Cunningham was at the Woodner from October 
14 to October 16, at which tune his hotel bill was $32.38. The nota- 
tion on the folio as to this particular bill reads: 

Charge to Attorney Jacques M. Schiffer, 32 Broadway, New York, N.Y. 

Mr. Cunningham was again at the Woodner from Januarj^ 4, 1959, 
to January 9, 1959. The total charges were $96.70. There is a nota- 
tion at the bottom of the folio, handwritten, reading "Charge to 1249, 
Mr. Herman." However, that is crossed over in ink. There is a 
notation on the right, although it is crossed over, but I am sure it 
reads "C/L Teamsters, Detroit." 

There is a notation on the top of this particular card reading "Do 
not charge to Mr. Herman." Information we have received will 
indicate that as of this time a special credit ledger was set up for Mr. 
Cunningham, personally, and this bill was charged to that particular 
account. 

I might say that this card also has a notation on this reading to the 
effect "No information." Thereafter, when this was charged to Mr. 
Cunningham personally, Mr. Cunningham was at the Woodner from 
January 11 to January 12. His total bill was $20.65. There is a 
notation on the card, "Charge to Herman, A-1249." However, the 
ledger which we have just received, the completed ledger related to 
the Teamsters, does not reflect that this particular charge was trans- 
ferred to a Teamsters ledger. 

Mr. Cunningham was again at the Woodner on January 14 to 
January 17, 1959. The charges were $59.78, and they were trans- 
ferred to Mr. Cunningham's personal ledger, these particular charges. 

Mr. Kennedy. So the practice of having the bills transferred 
over — first, the bills were paid directly by the Teamsters. Then they 
were transferred over to Mr. Cunnmgham's bill and paid by the 
Teamsters, and in January of this year, in the middle of January of 
this year, that practice stopped, and a special account was set up for 
Mr. John Cunningham and the bills were billed directly to him? 

Mr. TiERNEY. That is right. There is one correction, you might 
say, that in the second instance they were actually transferred to the 
Teamster billing but paid by Harold Gibbons. 

Mr. Kennedy. What do the records show as far as the bills of Mr. 
Moss Herman ? 

Mr. TiERNEY. I might summarize, if I may, on Mr. Herman. He 
was initially at the Woodner Hotel commencing August 25, 1958, 
and was there at varying times through January of 1959. 

Bills of Mr. Herman which commenced on August 28, 1958, and 
ended October 24, 1958, total $318.29. These bills were transferred 
to the Teamster account, the Teamsters ledger, and were paid by the 
Teamsters. Thereafter, with bills commencing November 27, 1958, 
tnd ending January 28, 1959, which total $1,511.85, were also trans- 
ferred to the Teamsters account, but they remain unpaid as yet. 

Mr. Kennedy. That account has not yet been paid ? 

Mr. TiERNEY. That is right. They are still listed as charges to the 
Teamsters. 

The Chairman. In other words, they are actually now on charge 
to the Teamsters and not to Mr. Herman ? 

Mr. TiERNEY. That is correct. Senator. 



16152 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. Herman got the service, but the charge was made 
against the Teamsters? 

Mr. TiERNEY. Yes. 

Mr. Kennedy. The original bill of some $385 has been paid? 

Mr. TiERNEY. It has been paid. 

Mr. Kennedy. Was that paid by the International or by local 299 ^ 
Was it charged to the International or local 299 ? 
. Mr. TiERNEY. I am not sure. It is just billed to Teamsters Union^ 
2Y41 Trumbull. That would be 299. 

Mr. Kennedy. It was not sent here to Washington, but it was sent 
to Detroit? 

Mr. TiERNEY. That is right. 

There are certain bills — the folios with respect to Mr. Herman and 
for the period December 2 through December 7, 1958, reads that the 
room was occupied by "Moss Herman and One." The second individ- 
ual is not further identified. 

Furthermore, from December 11 through December 16, 1958, the 
folio is similarly designated, "Mr. Moss Herman and One." We are 
not certain as to who the "One" was. The only indication we have 
is that there was a telephone call made from the room on December 7, 
1958, cliarged to a Cunningham. 

The Chairman. Do you want to make those records exhibits? 

Mr. Kennedy. Yes. 

The Chairman. The records the witness has testified from will be 
made exhibit No. 248, in bulk. 

(The records referred to were marked "Exhibit No. 248" in bulk 
for reference and may be found in the files of the select, committee. ) 

Mr. Kennedy. Mr. White. 

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. White. I do. 

TESTIMONY OF DONALD WHITE, ACCOMPANIED BY COUNSEL, 
JOSEPH M. WILLIAMSON 

The Chairman. State your name, your place of residence, and your 
business or occupation. 

Mr. White. My name is Donald White. I live at 10202 Brunett 
Avenue, Silver Spring, Md. I am an accountant employed by a CPA 
firm here in Washington, stationed as resident auditor at the Woodner 
Hotel. 

The Chairman. Thank you very much. 

You have counsel. Let the record show that Mr. Williamson 

Mr. Williamson, I have represented the hotel for 6 years. 

The Chairman. All right. Let the record show that Mr. William- 
son appears as counsel for the witness. 

Proceed, Mr. Kennedy. 

Mr. Kennedy. Mr. White, I want to ask you about this ledger 
sheet. 

Tlie Chairman. The Chair hands you what purports to be a photo- 
static copy of a ledger sheet on an accoimt of the Teamsters Union, 
2741 Trumbull Avenue, Detroit, Mich. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16153 

This that I hand you consists of five photostatic copies of ledger 
-sheets, I believe. Would you examine it and state if you identity it? 

(Document handed to the witness.) 

(The witness conferred with his counsel.) 

Mr. White. Yes, sir. This is our ledger sheet on that particular 
account. 

The Chairman. That is a part of exhibit 248 which we have lust 
Jt-ef erred to ? 

Mr. White. Yes, sir. 

The Chairman-. All right. The witness identifies it as a photo- 
static copy of that account. 
Proceed, Mr. Kennedy. 

Mr. Kennkdy. ^Mr. V\liite, there is a notation there on the ledger 
m connection with its payment. Could you tell us what the back- 
ground of that is ? 

Mr. White. Which specific item are you referring to 

Mr. Kennedy. I think it is the one we have discussed before. 
Mr. White. Mr. Cumiingham's, the portions of his bills? 
Mr. Kennedy. Yes. Would you relate to the committee what 
■occurred ? 

Mr. White. Yes. I do know that several charges of Mr Cun- 
ningham, one I believe, for $12.56, and the other for $4.12, were 
transferred to the twcount of Mr. Moss Herman. His account then, 
when he checked out of the hotel, was transferred to this ledger card. 
Iat ^!^^.^^®^ ^^.' ^^^® ^^'^nt office cashier called me to the desk and said, 
•'Mr. Gibbons is here with three folios which he wants to pay in cash " 
I might state that I had never seen Mr. Gibbons before, and I caii- 
iiot state that this was Mr. Gibbons. I was told it was. I have not seen 
him since. I would not know him now if he walked into the room. 

At that time he had three invoices in his hand, these two I men- 
tioned and another 

Mr. Kennedy. These are two for John Cunningham ? 
Mr. White. That is correct. 

The Chairman. I hand you here those invoices. State if you 
identify them, photostatic copies. Examine them and see if they are 
the photostatic copies of the two you referred to. 
(Documents were handed to the witness.) 

Mr. White. Yes. they are. He had these two invoices and one 
•other for $4.12 also, which I believe was a Mr. Matinskv's bills 

The total of the three amounted to $20.80. This mairwhom I was 
told was Mr. Gibbons, paid us $20.80 in cash for those three invoices. 
Mr. Kennedy. He said he wanted to pay them himself ? 
Mr. White. Yes. 

Mr. Kennedy. And you made the necessary changes on the ledo-er 
^sheets? ' *= 

Mr. White. Well, I didn't make any change. In receivincr pay- 
ment on any of these accounts or any accounts I have, I try to identify 
where I had the charge, and when I get the payment I naturally want 
to place the payment on the same ledger card so that it will balance out 
to zero it I can make it balance out to zero. 

Mr. Kennedy. Did you make such a notation ? 

Mr. White. I made a notation here, yes, that those particular items 
-tvere paid on October 14, so that in the event it was necessary to go 



16154 IMPROPER ACTIVITIES IN THE LABOR FIELD 

back and reconcile with anyone as to what the outstanding balance 
at any time represents I could eliminate those particular items in 
making a reconciliation of the outstanding balance. 

Mr. Kennedy. Mr. Chairman, the situation here, although it is a 
relatively minor amount of money that is involved, indicates and shows 
that the Teamsters, at least as far as Harold Gibbons is concerned, had 
complete knowledge and information of the fact that these bills of 
John Cunningham's were being paid and charged to the Teamsters, 
and he came in personally, himself, and paid this amount of money for 
John Cunningham in cash. 

What was the situation so far as Moss Herman's bills were con- 
cerned ? Who gave you instructions to send those bills to local 2 )9 ? 

Mr. White. To the best of my knowledge, Mr. Herman toLl me 
when the question was raised that I should send these bills to, and he 
made reference to, Dianne, in Detroit. From this I made the as- 
sumption that it should be charged to this Teamster Union, Detroit 
account. 

Mr. Kennedy. Did you know who Dianne was ? 

Mr. White. I am not sure that I did at the time. I believe Dianne 
is Mr. Holla's personal secretary in Detroit. 

Mr. Kennedy. From then on you charged Mr. Moss Herman's bills 
to the Teamster account ? 

Mr. White. That is correct ? 

Mr. Kennedy. Did you have a conversation with Mr. Hoffa in 
January of this year in connection with these bills ? 

Mr. White. Yes ; I did. 

Mr. Kennedy. Wliat did he state to you at that time ? 

Mr. White. I talked to him on the phone, and he was interested in 
knowing whether or not any of the bills of John Cunningham or Moss 
Herman had been paid by any of the Teamster organizations, by either 
any of the locals or by the international. 

Mr. Kennedy. And you told him that they had ? 

Mr. White. Well, I told him that it was difficult for me to try 
to find out. As I mentioned before, when I get a payment in, I 
merely locate the proper ledger that it was charged on, and credit 
that. Whether payments are made by check or whether they are 
made by cash, so long as I can properly identify where the charge 
was, that is where the credit ^oes. An examination further of some 
of the payments on this particular ledger card indicated that some 
of those bills of Moss Herman had been paid by either local 299 or 
the international. I don't recall now. 

Mr. Kennedy. Did you relate that to Mr. Hoffa ? 

Mr. White. Yes, I believe that I did. 

Mr. Kennedy. Did you call him back ? 

Mr. White. No. I think — well, I can't say for sure, whether I 
tried to find out while he was still on the phone or whether I called 
him back. I don't believe I called him back. 

Mr. Kennedy. Did he tell you to stop doing that from then on? 

Mr. White. No, he did not. 

The Chairman. Why did he say he wanted to know ? 

Mr. White. He didn't say why he wanted to know. I knew that 
Mr. Hoffa was a customer of the Woodner, and we like to please our 
customers. I felt that certainly it is information that he could have 
if he wanted it. 



iMPROPteft ACTrvrriES in the labor field 16155 

The Chairman. Wlien he found out, and you told him they were 
being paid in that manner, he didn't tell you to stop it ? 

Mr. White. No, sir ; to my knowledge he didn't tell me to stop it, 
because since that time Mr. Herman has been there and I have made 
the same disposition of the accounts at this time, because nobody has 
given me specific instruction to do otherwise. 

The Chairman. So even Mr. Hoffa knows about it? 

Mr. White. I assume so. 

The Chairman. You assume it? He talked to you about it? 

Mr. White. Well, at the time he talked to me, I certainly told him 
then, yes, and I suppose he knows I am continuing to do it. 

Mr. Kennedy. A special account for Mr. John Cunningham, how- 
ever, was set up subsequently ? 

Mr. White. That is right, yes. 

Mr. Kennedy. And instead of his bills going to Moss Herman, they 
are being paid directly by John Cunningham ? 

Mr. White. At the present time they have been set up to be billed 
to Mr. Cunningham. They have not been paid as yet. 

Mr. Kennedy. That is all. 

The Chairman. Did Mr. Cunningham know how his bills are being 
taken care of at the time ? 

Mr. White. Did he know ? 

The Chairman. Yes. 

Mr. White. I assume so. I never talked to Mr. Cunningham about 
how they were being taken care of. 

The Chairman. All right. Thank you very much. 

Mr. Kennedy. Mr. Moss Herman. 

The Chairman. Come forward, Mr. Moss Herman. 

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. Herman. I do. 

TESTIMONY OF MOSS HERMAN, ACCOMPANIED BY COUNSEL, 
JOSEPH M. WILLIAMSON 

The Chairman. State your name, your place of residence, and your 
business or occupation. 

Mr. Herman. Moss Herman, 142-20 26th Avenue, Flusliing, Long 
Island. I am on compensation, disabled. 

The Chairman. On compensation ? 

Mr. Herman. State compensation. New York, and also receiving 
Federal pension as being disabled, according to the 

The Chairman. Well, is this workmen's compensation you are re- 
ceiving, disability from injury? 

Mr. Herman. Injury while at work. 

The Chairman. You receive disability pension from the State of 
New York and also from the Federal Government; is that right? 

Mr. Herman. I receive compensation from New York and also 
from the Federal Government as being totally disabled. In the— 
what do you call the act ? the Social Security Act. 

The Chairman. Social security ? 

Mr. Herman. Yes, sir. 



16156 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The Chairman. You are actually not employed, then ? 

Mr. Herman. No, sir ; not employed. 

The Chairman. That is your sole income, your compensation, so- 
cial security ? 

Mr. Herman. Yes. 

The Chairman. That is the total source of your income ? 

Mr. Herman. No sir. Mrs. Herman works. 

The Chairman. I am talking about your personal income. 

Mr. Herman. Personal income? That is all. 

Mr. Kennedy. How long have you been on disability ? 

Mr. Herman. I have been disabled since June 28, 1947, sir. 

Mr. Kennedy. Is that the last time you had employment ? 

Mr. Herman. Yes, that is the exact date that I got hurt while on 
the job. 

Mr. Kennedy. And you have not had employment since that time ? 

Mr. Herman. No, sir. 

Mr. Kennedy. You were active in the rank and file movement 
against the incumbent leadership of local 584 of the Teamsters? 

Mr. Herman. Mr. Chairman, may I please put into the record at 
this time two points, and that is this : At first, newspapers have stated 
that I am one, and I think Mr. Kennedy gave that report, that I am 
one of the 13 dissidents. At no time have I, nor do I belong, to the 
group of the 13. 

Mr. Kennedy. I was in error. 

Mr. Herman. You were in error ? Thank you, Mr. Kennedy. 

The Chairman. You are speaking about the 13 that originally filed 
the suit ? 

Mr. Herman. Yes, sir. Mr. Kennedy said he was in error. 

The Chairman. You were not one of those ? 

Mr. Herman. No, sir ; at no time. 

Then, again, sir, I have been told by my attorney that Mr. Kennedy 
or somebody from your department has told newspapermen that I am 
under an alias of Moses Herman, have been arrested, and have con- 
victions. 

At no time have I ever been arrested ; at no time have I ever been 
convicted at all. I wish to have that on record, sir. 

The Chairman. All right. The record is made. Proceed. 

Mr. Herman. And I have never been under any other name of 
Moses Herman. 

The Chairman. You have never gone under any aliases ? 

Mr. Herman. No, sir. 

The Chairman. Is there anything further you wish to state ? 

Mr. Herman. That is all, sir. 

Mr. Kennedy. Mr. Herman, you were active in the rank and file 
movement against the incumbent leadership of local 584 of the Team- 
sters ; is that right ? 

Mr. Herman. Yes, sir. 

Mr. Kennedy. That battle by you and by some of the other members 
of that local has been going on for how long? I am not going to go 
into all of that, but I want to get your background. 

Mr. Herman. I understand. I want to say this, sir, that with refer- 
ence to dates and so forth 



Mr. Kennedy, Just approximately. 



li 



IMPROPER ACTIVrriES IN THE LABOR FIELD 16157 

Mr. Herman. Well, I have been in litigation and other things 
against corruption within the locals in New York for the past 15 years. 

Mr. Kennedy, How long have you known Mr. Hoffa, Mr. Herman? 

Mr. Herman. I did not know Mr. Hoffa, sir, until you called me 
here one day and asked me to appear, that you would like to talk 
to me. I first met you in New York at your home at 270 Park Avenue, 
with Mr. Tierney and Mr. Bellino. Later you called for me and I 
came here. While listening to the different reports, I met Mr. Hoffa. 

Mr. Kennedy. You met him here in the building ? 

Mr. Herman. Here in the building. 

Mr. Kennedy. And you have seen him occasionally since that time, 
have you ? 

Mr. Herman. Well, possibly. I have, I think. Now, I don't know 
whether these supreme court cases in New York came first, one or 
the other. My memory is not too clear. I cannot recall that too well. 
But it was in New York first, or here. But that is where I met him. 

Mr. Kennedy. Have you received any money from Mr. Hoffa? 

Mr. Herman. Well, the moneys I have received — I have received 
as the only help from Mr. Hoffa as an arrangement made by him 

Mr. Kennedy. Just answer the question. Have you received any 
money from Mr. Hoffa ? 

Mr. Herman. Only from him personally, yes. 

Mr. Kennedy. Have you received some ? 

Mr. Herman. My traveling expenses only in cash. 

Mr. Kennedy. When did that start ? 

INIr. Herman. I came here, sir, many months, even before Mr. Hoffa 
was the president of this organization. Mr. Beck was the president 
of this organization. There was a litigation that went on in New York 
and I asked help from Mr. Beck, which also included yourself. 

It seemed I could not get any help from him. When Mr. Hoffa 
became the president, I asked help to the extent of trying to ease the 
corruption in local 584 in New York. He did make a phone call ta 
an attorney, Mr. Cohen, the attorney of 584, asking what is going on 
there. I don't know what the outcome was. 

But then I asked Mr. Hoffa that I would like to straighten out 
part of the mess that is going on in New York. He said, "Okay, 
Mr. Herman, what do you intend doing? You are not a wealthy man. 
You are spending your trips here. You are coming back; you are 
refusing to take money from me. I will tell you what. If you wish 
me to cooperate in some sort of a way, at least let me pay part of your 
expenses, such as if you stay at a hotel I v ill pay your expenses at 
the hotel, and your carfare. I think you are entitled to it." 

I said, "I don't care to be obligated to anybody. I have been offered 
bribes in New York, which the district attorney has heard, and the 
Attorney General knows about it. I turned them down." 

I said, "At no time will I be obligated to anybody." 

When we got into a little dispute, he said, "Okay, then, I am not 
going to ask you. You are not a wealthy man, you are on compensa- 
tion, on disability." 

To keep matters even, and to get the help that I needed, I agreed 
to accept that sort of tiling, help only not from any local, not from 
any organization, but only personal expenses coming out of Mr. Hoffa's 
own pocket. 



16158 IMPROPER ACTIVITIES IN THE LABOR FIELD 

That was the arrangement, fare from New York or whatever I 
needed for traveling expenses, and that is the only cash that I received 
was traveling expenses. 

Mr, Kennedy. When did he start paying you these moneys in 
cash? 

Mr. Herman. Well, I came over to headquarters every now and 
then whenever I laid out, say, $15 or $20. It was around August or 
sometime then. 

Mr. Kennedy. Of 1958? 

Mr. Herman. Yes, sir. 

Mr. Kennedy. He started making payments to you at that time! 

Mr. Herman. He did not make payments. He asked me what 
my expenses was, and I accepted it. I did not know what you call 
get any payment for any work. 

Mr. Kennedy. Did he offer you any payment? 

Mr. Herman. Well, he wanted to offer me money, the same as a 
lot of people wanted to give me money. 

Mr. Kennedy. How much money did he want to offer you ? 

Mr. Herman. There was no fixed sum mentioned, and he said, "Do 
you need any money," and that is the expression that was told, "Do 
you need any money?" I said, "No, I am not taking any money from 
you or anybody else." 

Mr. Kennedy. But you started to take your expenses, is that right ? 

Mr. Herman. That was the only arrangement. 

Mr. Kennedy. Where would you pick up this money from him, at 
the union headquarters? 

Mr. Herman. Mr. Kennedy, you asked me a question and let me 
finish it, please. I am a little slow on dates and I want to get that 
straight, and I don't want to be caught. 

The thing was, when I came to headquarters, I asked whatever 
I spent, we'll say, if I flew a plane, at that time it was $30, I think 
and 44 cents, two trips. I got $60.88. For that matter, I accepted, 
we will say 62 or 63 just to change off. 

If I went by bus, which amounted to $14 both ways, with one day's 
insurance, I accepted the amount of the bus. If I went by train, I 
accepted the amount of the train. That is the only cash I received 
from Mr. Hoffa. 

Mr. Kennedy. Where would you pick this money up ? 

Mr. Herman. I came over to headquarters and I had a talk with 
him in reference to conditions going on through New York and dif- 
ferent other places. That is one of the main reasons why I accepted 
this by conferring with him as to different conditions in New York, 
which were, as you know and found out, veiy bad. 

Mr. Kennedy. So he would pay you $63 ? 

Mr. Herman. What ever my expenses for traveling were, he would 
give me just the amount I aslced for. ISfaybe one time I might have 
gotten $100 figuring for the next time. 

Mr. Kennedy. And would he also pay it to you himself or would 
anybody else pay you ? 

Mr. Herman. No, he gave it to me personally. 

Mr. Kennedy. Always, and you never got it from anybody else? 

Mr. Herman. I never got it from anybody else. 

Mr. Kennedy. Where did he get the money from ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16159 

Mr. Herman. He simply went to his pocket, Mr. Kennedy, and took 
it out and handed it to nie. 

Mr.KEXXEDY. $100 and $63? 

Mr. Herman. Or whatever it was. He took my word for whatever 
I spent, knowing that I liave refusesd him any money that I needed 
and, therefore, he knew I was not looking to make any profit or take 
any extra money from him. 

Mr. Kennedy. How much money did he pay you in all? 

Mr. Herman. Well, I would say $400 up to date. Is that it? 

Mr. Kennedy. Yes. 

Mr. Her]\ian. Four or five hundred dollars. 

Mr. Kennedy. That is from approximately August or so? 

Mr. Herman. Until now, yes, and it is traveling expenses. 

Mr. Kennedy. Then, did you in turn, or were you paying some of 
Mr. John Cunningham's bills? 

Mr. Herman. I don't — what do you say ? 

Mr. Kennedy. Were you paying some of Mr. John Cimningham's 
bills? 

Mr. Herman. In reference to what? 

Mr. Kennedy. In connection with anything. 

Mr. Herman. Well, Mr. Cunningham was at the time in slight dif- 
ficulties and I don't know, and I said, "You come along with me," and I 
paid his bill, or rather he stayed with me at the hotel, and I ate in 
the restaurant and signed a check in the restaurant and covered Mr. 
Cunningham to that expense. 

Mr. Kennedy. Did you pay that money yourself? 

Mr. Herman. No, sir, I just signed for it and at no time did I ever 
see a bill from the Woodner Hotel. The only bill I saw was what I 
signed, included a tip in the restaurant, and gave it to the cashier, and 
that is all I did. 

Mr. Kennedy. Were they keeping the bills hidden from you or what? 

Mr. Herman. No, sir ; I was not interested. I am not interested in 
any bill, and if Mr. Hoffa is willing to pay for it, I will eat as hearty 
as I can. 

Mr. Kennedy. You made arrangements that staying at the Woodner 
Hotel, he would pay those? 

Mr. Herman. My board and food, sir. 

Mr. Kennedy. Did you tell the hotel to send your bill out to Detroit ? 

Mr. Herman. Well, there was an error there; in the beginning I 
didn't know M'hat to do and I said, "Send it to Detroit," and I figured 
Mr. Hoffa goes to Detroit where his home is. 

I had no intention of anything else and then there was an error 
and I understand they sent it to some local or some international. I 
corrected that and I said, "At no time must anybody else receive any 
bill but Mr. Hoffa, personally, as he, personally, will foot the bill that 
1 incur in the restaurant or in my board that I am staying at the hotel." 

ISIr. Kennedy. All of the bills seem to have been sent to local 299 
and paid by that local. 

Mr. Herman. The only thing I can say is, "Yes," it happened in 
the beginning but that was an error and I did not see any bills at 
all and I want you to understand that and I don't know what the total 
is, and I don't know how much it involved except day by day in the 
restaurant, I signed the check, including Mr. Cunningham, and added 
a tip and that is the only thing that I saw. 



161C0 IMPROPER ACTIVITIES EST THE LABOR FIELD 

Mr. Kennedy. Who did you tell in the hotel ? 

Mr. Herman. I beg pardon ? 

Mr. Kennedy. Who did you tell in the hotel about forwarding- your 
bills? ^^ 

Mr. Herman. Who did I tell ? 

Mr. Kennedy. Yes. 

Mr. Herman. I told somebody behind the desk, the cashier or some- 
body and I don't know, and they change cashiers so often there, and 
I told them just send the bill to Mr. Hoffa. 

Mr. Kennedy. What about Diane? 

Mr. Herman. Well, I know she is his secretary out in Detroit, and 
that is the only point I do know. 

Mr. Kennedy. Did you tell them to send the bills to Diane? 

Mr. Herman, I am telling you what the error was, and somebody 
mentioned, "Do you mean his secretary, Diane?" and I said^ "I sup- 
pose so." 

Mr. Kennedy. You mean just this man behind the desk knew what 
Mr. Hoffa's secretary's name was, Diane ? 

Mr. Herman. O, no. He must have known possibly, and he must 
have paid bills for previous people there and all I know is that I said,. 
"Please send this bill to Mr. Hoffa and he will take care of it," and 
that is all I do know. 

Mr. Kennedy. Did you also give Mr. Cunningham the $2,500 ? 

Mr. Herman. Yes, sir. 

Mr. Kennedy. Wliere did you get that money ? 

Mr. Herman. I got that money, I had that money first, previously^ 
and then I had given to me or loaned to me, rather, $3,000. 

Mr. Kennedy. By whom ? 

Mr. Herman. By Mr. Jacques Schiffer. 

Mr. Kennedy. That is the same attorney that we have mentioned 
earlier today ? 

Mr. Herman. Yes, sir. 

Mr. Kennedy. That represented Mr. Hodes, Mr. Davidoff, and 
others ? 

Mr. Herman. I don't recall who he represented at the time. I don't 
recall who he represented. 

Mr. Kennedy. How long had you known Mr. Schiffer ? All of your 
life? 

Mr. Herman. No, sir. 

Mr. Kennedy. When did you meet him ? 

Mr. Herman. Go ahead, sir. 

Mr. Kennf:dy. When did you meet Mr. Schiffer ? 

Mr. Herman. I met Mr. Schiffer in 1057 here at one of your hearings 
and he seemed to have done, or I thought he did a good job and I don't 
know who he represented or what the background was. 

I even think it happened to be one of those paper locals, but he is 
an attorney or as an individual, I thought he did pretty well, and I 
asked for his card. While I did several other people asked for his 
card at the vSame time, right in tliis very ro<^)m, sir. That is wheii I 
met Mr. Schiffer. 

Mr. Kennedy. When di d you see him after that ? 

I might say, Mr. Chairman, he did represent these three gentlemen^, 
all of whom took the fifth amendment. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16161 

Mr. Herman. Who is that? 

Mr. Kknnedy. Mr. Schiffer represented Hodes, Davidoff & Gordon, 
and all of his clients took the fifth amendment before the committee. 

Mr. Herman. I am not interested in who he is, and he was an attor- 
ney and he represents all kinds of people. 

Mr. Kennedy. You thought he had done a good job ? 

Mr. Herman. As far as I am concerned, sitting at this table, I have 
seen some pretty good men handle worse criminals than that, and I 
think they have a pretty good name, and I am not interested in tlieir 
background and I am interested in what they could have done. 

Mr. Kennedy. So when Mr. John Cunningham needed an attorney 
you took him to see Mr. Schiffer ? 

Mr. Herman. When John Cunningham came to me and said, "Moss, 
I am stuck. I need an attorney," and I said, "I think I have the right 
fellow for you." He had been double-crossed, and I don't blame you 
for laughing, Mr. Kennedy, because I also have been double-crossed : 
and I wish to say, Mr. Kemiedy, you may smile, but you are part and 
parcel of the double-cross that I have received. 

I hate to say it, sir, but when this whole thing started this whole 
milk industry in New York, we helped your committee and we went 
out on a limb, sir, and also we brought you all sorts of people, as 
Mr. Tierney and Mr. Bellino can vouch for, and we came to your home, 
Mr. Cunningham and I, and we tried to do a job which you can 
vouch for, and I don't have to be told that I am a crook or I have had 
a conviction when I haven't even got a parking ticket. 

Excuse me, I am sorry, Senator. 

Mr. Kennedy. You took 

Mr. Herman. I wish to apologize for that, and I am very sorry. 

Mr. Kennedy. You took Mr. Cunningham to see Mr. Schiffer ? 

Mr. Herman- Yes, sir, and I thought Mr. Schiffer was just the type 
of man that could handle Mr. Cunningham after what he went through, 
the doublecross. 

Mr. Kennedy. And he agreed to take the case ? 

Mr. Herman. I don't know what happened, the financial arrange- 
ments or anything else. 

Mr. Kjinnedy. Then, did Mr. Cunningham come to you later and say 
he bad to pay some other attorneys? 

Mr. Herman. What other attorneys? 

Mr. Kennedy. Mr. Williamson. 

Mr. Herman. Mr. Cunningham came to me and I don't remember 
the dates, and I think that it was around November or some time like 
that, and I have some sort of memory that he was going to hire an 
attorney. 

I wasn't in Washington at the time. He said he saw an attorney 
that he likes and he thinks can do the job in Washington better than 
Mr. Schiffer could. So he said, "There is only one trouble; they 
want money." 

Previously, in all litigation in New York, I will admit I have had 
many attorneys and all volunteered their services. Therefore, that 
is why I say I smiled when he said those people like money. 

So I said, "I don't know w^here to get it. I will try." He said. 
*'How about you? You can dig up money for all sorts of campaigns 
and all sorts of things. How about it, Moss ?" I said, "Well, I'll try." 



16162 IMPROPER ACTIVITIES IN THE LABOR FIELD 

I had some money given to me by Mr. Schiffer, really, at the time, 
but not for this purpose, and I was in ill health, and I still go to a 
doctor, and Dr. Lilienfeld at 574 West End Avenue, monthly, because 
of my condition, sir. And I wish to state that these are my legs which 
I got while on the job, and these I have because of a fusion on the 
spine, and therefore, they have sort of deteriorated or anesia has 
set in and I still have to go once a month to the doctor. 

He doesn't know what happened to them and those things we can't 
help. This was up to June of 1947. 

Mr. Kennedy. Could you get back to getting the money from Mr. 
Schiffer? 

Mr. Herman. Well, Mr. Schiffer, when I asked Mr. Schiffer, since 
he is an attorney and then we became friendly, and I said, "Look, 
Jacques, I need some money." And he said, '"What for?" And I 
said, "I need it personally." 

My wife is working, as you know, and I didn't have disability from 
the Government yet because I was receiving $28 a week compensation, 
which is $116 a month. My social security was $86.30 and since I was 
receiving more from compensation, I couldn't receive the Government 
setup, because only if there was a comparison there would I receive 
more of it. 

Therefore, until August or September, the Government paid me 
the money because of a law that went through. 

Mr. Williamson. May I consult with the witness for just a moment, 
and I hate to interrupt. 

The Chairman. I wish you would ask him to just answer the 
question. 

Mr. Williamson. These men are very busy, and I am very busy 
and you want to get through and if you will answer Mr. Kennedy's 
questions, we will all get out of here. 

Mr. Herman. He wants to get $2,500, and that is all I paid him. 

The Chairman. You are trying to do $2,500 worth of talkhig ? 

Mr. Herman. I said he only got $2,500, and that is all Cunninghoni 
paid his attorney, and so I can't get any more value out of it. 

Mr. Kennedy! You got the $2,500 from Mr. Schiffer? 

Mr. Herman. Yes, sir. 

Mr. Kennedy. And vou turned that money over 

Mr. Herman. I got $3,000. 

Mr. Kennedy. From Mr. Schiffer, and you turned $2,500 of it 
over to Mr. Cunningham ? 

Mr. Herman. Yes, sir. 

Mr. Kennedy. To pay his attorney ? 

Mr. Herman. That is right. 

Mr. Kennedy. Now, did you give Mr. Schiffer a note? 

Mr. Herman. I ^ave him a receipt or a note or whatever you want 
to call it, without interest, and it was 10-7-58, and thai is the exact 
date on the note. 

Mr. Kennedy. Why Avould Mr. Schiffer, whom you had only known 
briefly, put up $3,000 in cash for you ? 

Mr. Herman. Mr. Kennedy, in New York a lot of people have of- 
fered me cash, and I think it is not my credit because I had to have 
somebody else borrow for me later, but I am still pretty good for 
some monev. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16163 

Mr. Kennedy. Wliy would Mr. Schift'er, whom you knew only a 
short time, put up $3,000 ? 

Mr. Herman. He must have checked my background, sir, and I 
don't know. I asked him and he had it for me, cash money, and he 
gave it to me. 

Mr. Kennedy. Mr. Schiffer was interviewed by our investigator, 
Mr. Herman, on January 28, 1959, and he stated tliat he spent perhaps 
$700 or $800 out of his own pocket for his own expenses such as travel, 
meals, and hotel bills, and he also admitted that on one occasion the 
Woodner Hotel forwarded to Schiffer his own bill and the bill of 
Moss Herman. Was he paying your bill, also, Mr. Herman, at the 
Woodner Hotel ? 

Mr. HERJtAN. I don't know what he paid. We went to x\tlantic 
City at one time with Mr. Cunningham, and he wanted to confer or 
think something over, and I guess he footed the bill. 

Mr. Kennedy. Did you reimburse Mr. Schiffer ? 

The Chairman. You had to go to Atlantic City to think something 
over ? Is that your testimon}' ? 

^Ir. Herman. Yes. 

The Chairman. Is that what you said ? 

Mr. Herman. Pardon me? 

The Chairman. Did he have to go to Atlantic City to think some- 
thing over? 

]\Ir. Herman. I understand that he wanted to get Mr. Cunningham 
out of New York where he was pestered by phone calls or other 
mattei-s. 

The Chairman. Who wanted to get Cunningham out of New 
York? 

Mr. Herman. Mr. Schiffer, and he thought that the best plan was 
to get out because they had a case coming on, and he wanted to sit 
down and study the case at that time. 

The Chairman. He went to Atlantic City to talk about the case? 

Mr. Herman. Yes ; it was just a short time. 

Tlie Chairman. I guess that he came out all right. 

Mr. Kennedy. Did you reimburse Mr. Schiffer for the bills that 
he paid for you at various hotels ? 

Mr. Herman. No, sir. 

Mr. Kennedy. You have not reimbursed liim ? 

Mr. Herman. No ; but the only thing was that I gave Mr. Schiffer 
back $300. That is, he ran short and he needed some money, and I 
gave him back $300, which means that I only owe him $2,700. 

Mr. Kennedy. What about his hotel bills that he paid for you? 

Mr. Herman. Wliat hotel bill did he pay for me, sir ? 

I don't know anything about it. 

Mr. Kennedy. You don't know anything about the fact that he did ? 

Mr. Herman. If he footed a bill 

Mr. Kennedy. Why was he paying your hotel bills ? 

Mr. Herman. Well, if you invite me to go someplace, you are going 
to foot the bill, as far as I am concerned. 

Mr. Kennedy. He invited you to the Woodner Hotel in Washing- 
ton, D.C. 

Mr. Herman. What is that ? 



16164 IMPROPER ACTIVITIES . IN THE LABOR FIELD 

Mr. Kennedy. On November 10 you stayed at the Woodner Hotel, 
from November 10 through November 13. 

Mr. Herman. Well, he brought Mr. Cunningham here to Washing- 
ton and asked me to come along, and he had something pertaining to 
the case of Mr. Cunningham, and, I think, in reference to Mr. Schmidt, 
one of the monitors. Naturally, I took the attitude, since he is on a 
case, I am not going to have Mr. Hoffa foot my bill while I am with 
somebody else's case, and that is the reason he footed the bill on that 
case. 

Mr. Kennedy. Instead of having Mr. Hoffa foot the bill, you had 
the attorney whom you hired ? 

Mr. Herman, I am not interested. I came at the attorney's juris- 
diction. I didn't come on my own business with Mr. Hoffa. If I 
came there pertaining to things that I should notify or be with Mr. 
Hoffa, I would charge Mr, Hoffa. I do not charge him for anything 
except pertaining to his own affairs. 

Mr. Kennedy. This is rather unusual, that you have your bills paid 
by Mr. Cunningham's attorney, and Mr. Cunningham has his bills 
paid by you, and then you get your money from the Teamsters' Union. 

Mr. Herman. If you will check my record, I am a pretty — how 
would you say ? What was that word that you said before ? 

Mr. Kennedy. "Publicly" or what ? 

Mr. Herman. What did you say just now ? It seems to me kind of 
funny. I am a funny kind of a guy, and I allow no one to pay my 
bills unless there is a reason for it. 

Mr. Kennedy. We interviewed Mr. Schiffer, and he said on occasion 
he paid your bills. 

Mr. Herman. Possibly ; yes. 

Mr. Kennedy. And that you have reimbursed him for those bills. 

Mr. Herman. Certain bills, I have, for the sole reason that I have 
been short, and I didn't get to Mr. Hoffa that day. 

Mr. Kennedy. Did you reimburse him or not ? 

Mr. Herman. I possibly did, and I don't recall. 

Mr. Kennedy. Did you ever give him any money ? 

Mr. Herman. Well, I told you I gave him $300. 

Mr. Kennedy. Other than that. 

Mr. Herman. Myself, I don't remember. 

Mr. Kennedy. Did you ever reimburse him for any of your ex- 
penses ? 

Mr. Herman. Possibly I did, and I don't recall just how or when, 
sir. I don't recall. Things have been moving around that fast. 

The Chairman. You just met the man a little less than 2 years ago; 
did you not? 

Mr. Herman. Yes, sir. 

The Chairman. Now you have been paying your expenses at dif- 
ferent times ? 

Mr. Herman. May I say this, sir, that he is not paying my expenses 
except when Mr. Cunningham 

The Chairman. Except there is a reason for it. 

Mr. Herman. Yes. 

The Chairman. On occasions when there was a reason for it, did 
you reimburse him ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16165 

Mr. Herman. At certain times, I recall, yes, once or so I did reim- 
burse him and I just can't recall the incident, and I know I gave him 
some money, and I reimbursed him, some money that he laid out 
for me. 

The Chairman. All of this happened within the last year, or less 
than 2 years time? 

Mr. Herman. If it comes to dates. Senator, I w ish to say if it comes 
to dates I am pretty bad on dates. 

The Chairman. Let us get back to about last November. That is 
pretty close. 

Mr. Herman. What is that? 

The Chairman. Let us get back to about last November, that is 
pretty close. 

Mr. Herman. Yes, sir. 

The Chairman. Your memory is not that bad, I don't suppose. 
Have you reimbursed him for the bills he paid for you last November ? 

Mr. Herman. Last November ? 

The Chairman. Yes. 

Mr. Herman. Where was that ? 

The Chairman. Where were you last November ? 

Mr. Herman. That is what I am trying to recall. I have been back 
and forth so many times. 

The Chairman. Let us say from November 10 to November 13. 
Where were you then ? 

Mr. Hersian. I was at the M^oodner, sir, I think. 

The Chairman. I think your bill came to about $86.18 at that tim.e, 
and he paid it, and did you reimburse him for that ? 

Mr. Herman. Well, $86.20, I reimbursed that, $86 and change, be- 
cause he claimed that bill was supposed to be charged to me, and I 
refused to accept it at first, to be frank with you, sir, and I thought 
it was his bill. And then he turned around and charged it to me, and 
I don't think that I have yet accepted it, unless they pushed it througli 
the hotel. 

The Chairman. You do not think that you ever paid it? 

Mr. Herman. Well, I don't know. I never saw any bills, and these 
bills go right through the hotel, and I don't know. 

The Chairman. You never see them ? 

Mr. Herman. No, sir. 

The Chairman. You don't pay them without seeing them, do you ? 

Mr. Herman. I don't have anything to do with them, sir. 

The Chairman. Well, you did not pay it ? 

Mr. Herman. What is that? 

The Chairman. If you had nothing to do witli it and you didn't 
see it you didn't pay it. 

Mr. Herman. I am just saving that that bill, what you are talking 
about, was the date that Mr. Schiffer invited Cunningham or me to go 
along. That was the one bill 

The Chairman. I still do not know whether you ever repaid that 
bill or not. Did you ? 

Mr. Herman. No, sir : I don't pay any bills, sir. 

The Chaieman. And you don't repay them, or reimburse any one 
who does pay them ? 

36751— 59— pt. 43 If- 



16166 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Herman. The only time I reimbursed is if he lays out cash for 
me, sir. 

The Chairman. What is that ? 

Mr, Herman. If he lays out any casli for me. 

The Chairman. If he just pays a bill, that is not laying out cash? 

Mr. Herman. Well, I never see them. 

The Chairman. Well, is it or not ? I do not know what you mean 
by "laying out cash." 

Mr. Herman. If he would get the plane ticket for me, I reimbursed 
him for the plane ticket that he got for me. Of if we went by train, 
I would reimburse him for that. 

The Chairman. Did you reimburse him for any hotel bills? 

Mr. Herman. Hotel bills? 

The Chairman. Yes. 

Mr. Herman. At the Woodner, I never see any, sir. I can't reim- 
burse him. I can't reimburse anything I never see. 

The Chairman. You did not reimburse him for any hotel bills at 
the Woodner ? 

Mr. Herman. No, sir. 

The Chairman. Because you did not see any bills? 

Mr. Herman. That is right. 

The Chairman. And you don't know who paid them ? 

Mr. Herman. I know one thing: Any bills of mine are supposed 
to be charged to Mr. Hoffa personally. 

The Chairman. You said you were not going to charge them to 
Mr. Hoffa unless he liad something to do with it and when you went 
out there for this fellow you were not going to let him pay the bill. 

Mr. Herman. If I knew the bill was there, I would stop it, and 
I didn't know about it. 

The Chairman. In fact, you don't know whom you owe and whom 
you don't, do you ? You never see the bill and you never know any- 
thing about it. 

Mr. Herman. No, sir; not at the Woodner. 

(Members of the select committee present at this point in the pro- 
ceedings : Senators McClellan and Ervin. ) 

The Chairman. Senator Ervin. 

Senator Ervin. Mr. Schiifer is a lawyer in New York ? 

Mr. Herman, Yes, sir. 

Senator Ervin. And he knew that the only income you had con- 
sisted of disability payments under social security, plus workmen's 
compensation ? 

Mr. Herman. Yes, and my wife working. 

Tlie Chairman. You doivt take her income, do you ? 

Mr. Herman. Well, you said the income. That is part of tlie in- 
come, too, into tlie family. 

Senator Ervin. Your wife's earnings are part of your income? 

Mr. Herman. No. It is part of tlie earnings into the family. I 
couldn't exist without lior income. 

Senator Ervin. Mr. Schiffer knew that that was the only means of 
li veliliood you and your family ]iad ? 

Mr. Herman. Yes, sir. 

Senator Ervin. And you go to liini and ask him for $8,000, telling 
him that $2,500 of that is to pay a retainer fee to some other lawyer*? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16167 

Mr. Herman, At that time, sir, there was no such thing as retain- 
ing, as I told you. At tliat time there was no intention to pay any 
lawyer. It was for my personal self. I wasn't well. 1 was getting 
into debt, with sickness and doctors. That is what 1 used it for. 
There was no thought of any attorney at the time, sir. 

Senator Ervin. Jiut then you told Mr. Sciiitl'er you wanted to bor- 
row the money for yourself, that you needed it ^ 

Mr. Herman. Persoiial use. 

Senator Ervin. You never told him that Mr. Cunningham needed 
it? 

Mr. Herman. Mr. Cunningham did not get any of that at that 
time. He did not know anything about that until possibly a month 
or so, and I never told Mr. Cunningham where I got it. 

Senator Ervin. Let me see if I understand it. I thought you said 
you got $3,000 from Mr. Schiller. 

Mr. Herman. Yes. Right. 

Senator Ervin. And that you used $500 yourself, and gave $2,500 
to Mr. Cunningham ? 

Mr. Herman. No. I said $300 I gave back to Mr. Schiffer later, 
and when JSIr. Cunningham needed some money, I went different 
places trying to get it. I couldn't get the money, and I used $2,500 
of that and gave it to Mr. Cunningham, who, in turn, gave it to Mr. 
Williamson. 

Senator Ervin. All right. How did Mr. Schiffer give you this 
money ? 

Mr. Herman. In cash. 

Senator Er\^n. In cash ? 

Mr. Herman. Yes, sir. 

Senator ER^^N. I certainly practiced law in the wrong part of the 
country, because the lawyers in my part of the country don't run 
around with $3,000 in cash in their pockets. 

So he just reached into his pocket to get the casli ? 

Mr. Herman. No. He had it in an envelope. 

Senator Ervin. Where did he get the envelope? 

Mr. Herman. That you will have to ask Mr. Schiffer. I don't 
know where he got the envelope from. The money was in the 
envelope. He took the envelope out of his pocket and I even counted 
it in front of him, sir. 

Senator Ervin. And vou gave him a receipt? 

Mr. Herman. A receipt for $3,000, dated October 7, 1958. 

Senator Ervin. And he didn't require you to give him any note 
with any endorser ? 

Mr. Herman. Well, no, sir, just a receipt I gave him and it was 
without interest. 

Senator Er\^n. I am trying to hnd out. When you tell him you 
need $3,000 — and this is a man who knew that you only means of 
livelihood were yourself and your family, with the earnings of your 
wife, your disabilit}' under the social security and under the work- 
men's compensation law — when you asked him for $3,000, without a 
word he dives into his pocket, brings out an envelope, and gives you 
$3,000 that you count out ? 

(The witness conferred with his counsel.) 

Mr. Herman. The only thing. Senator, that I can say is, thank 
God I have a good reputation. 



16168 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Senator Ervin. I am not asking about your reputation. I am ask- 
ing about Mr, Schiffer. 

Mr. Herman. I can only tell you what was given to me, in one day, 
$3,000. 

Senator Ervin. That is your testimony, is it not, Mr. Herman? 

Mr. Herman. I am here to tell you the truth, and I am telling 
you the truth. I am not denying anything or stating any other fact. 
I received $3,000 in cash. 

Senator Ervin. This is the way you received it ? 

Mr. Herman. In an envelope handed to me; yes, sir. 

Senator Ervin. You asked Mr. Schiffer? 

Mr. Herman. I asked not only Mr. Schiffer, I asked a number of 
people. Mr. Schiffer came across. 

Senator Ervin. Well, you said those people didn't come across, 
so you had to ask Mr. Schiffer. 

Mr. Herman. Maybe he came first, then. 

Senator Ervin. You w^ent to Mr. Schiffer? 

Mr. Herman. Yes, sir. 

Senator Ervin. And you told him you needed $3,000 ? 

Mr. Herman. That I needed money. He said "How much?" and I 
said, "About $3,000." 

Senator Ervin. So, therefore, he reached into his pocket and pulled 
out an envelope ? 

Mr. Herman. No, sir. That was long before the same day. It 
wasn't the same day. I asked him previously for that money. He 
met me and gave me that money. 

Senator Ervin. Where did he meet you ? 

Mr. Herman. I met him. I met him. We sat in a restaurant. He 
took out the envelope, and he said, "Here, Moss." He was coming 
from New York, I am coming from Queens, a dividing line, we met 
in a restaurant and he gave me the money and he went on to work. 

Senator Erven. How long was that after you told him you needed 
the $3,000? 

Mr. Herman. That must have been a week or a few days. I don't 
just recall. 

Senator Ervin. Did you agree that he would meet you at that res- 
taurant with the $3,000? 

Mr. Herman. He called me and said, "Moss, I haA'e the money. 
Meet me at so-and-so on the way down on the Long Island Rail- 
road. I will get off." I don't recall what the station was. I came 
by with the bus from where I was. It was sort of a halfway point. 

Senator Ervin. We got there. Let us get to the cafe. Leave the 
train out. You met him by appointment, instead of your going to 
his office? 

Mr. Herman. That is right. 

Senator Ervin. You and he met at a restaurant, at a cafe, and he 
reaches in his pocket and pulls out an envelope with $3,000 in it and 
gives it to you ? 

Mr. Herman. He calls me that morning and says he has the money. 

Senator Ervin. Let's get to the cafe. 

Mr. Herman. It wasn't a cafe. It was a restaurant. There is a 
difference between a cafe and i-estaurant. I don't drink. I don't 
drink, sir, so I don't enter cafes. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16169 

Senator Ervin. Let's get to the restaurant, then. You go to the 
restaurant where he meets you and he dives into his pocket and he 
pulls out $3,000 in an envelope ? 

Mr. Herman. Mr, Senator, you make it kind of dramatic but it 
isn't so. He just merely handed me $3,000. 

Senator Ervin. It would seem rather dramatic to me if anybody 
would give me $3,000 under those circumstances. 

Mr. Herman. Possibly where you come from it means a lot of 
money. Possibly around here they spend more than that right here 
in Washington. 

Senator Ervin. Anyway, whetlier it was dramatic or not dramatic, 
he reached into his pocket, pulled out $3,000 in cash and gave it to you. 

Mr. Herman. May I correct you ? I don't like the expression "he 
pulled out." He handed me $3,000. 

Senator Ervin. He extracted it. 

Mr. Herman. I don't know extracted. He handed me $3,000 in an 
envelope. 

Senator Ervin. And which he had removed in some way from his 
pocket ? 

Mr. Herman. Naturally. 

Senator Ervin. He didn't require you to give him any note ? 

Mr. Herman. Yes, sir. I gave him a note. 

Senator Ervin. I thought you said receipt. 

Mr. Herman. Receipt, note, to me it is the same thing. 

Senator Ervin. And no agreement as to when it was going to be 
paid back? 

Mr. Herman. No, sir. 

Senator Ervin. And you weren't going to pay any interest on it? 

Mr. Herman. No, sir. 

Senator Ervin. And you gave him no security ? 

Mr. Herman. No, sir. 

Senator Ervin. And as far as he was concerned, there being no time 
of payment fixed, you could haA^e kept the $3,000 without paying any 
interest on it until the last lingering echo of Gabriel's horn trembled 
into ultimate silence, under the agreement ? 

Mr. Heriman. Senator, I wish you knew me a little better than 
across the table. You wouldn't pass that comment. 

Senator, I could have got many thousands just merely by putting 
my hand out, Senator. I could take all the blackmail and graft, if 
I want to, and Mr. Kennedy knows that, and so does the other gentle- 
men know it. 

]Mr. Kennedy. I can't vouch for you. 

Mr. PIerman. I don't think that is correct, when you pass a comment 
like that against my character. 

Senator Ervin. I am not talking about your character. I am talking 
about the agreement that you made with Mr. Schiffer. You said 
you could have the $3,000 free of all interest, that there was no time, 
no security required, no endorser required, no time fixed for paj^ment, 
I was asking you if imder the agreement you had with Mr. Schiffer, 
that you could have kept the money until, without paying any interest 
on it, until the last lingering echo of Gabriel's horn trembled into 
ultimate silence. 

Mr. Williamson. The Senator is an able lawyer, I know 



16170 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Senator Ervin. I think that is a correct interpretation of that, 
according to the letter of the contract. 

Mr. Williamson. I would suo;gest to you that possibly Mr. Schiffer, 
or whatever his name may be, could have sued him the next day on 
a demand. Frankly, I can understand your characterization 

Senator Ervin. I frankly do not think he could have sued the next 
day. A demand, in order to pay the next day, would have to be 
payable on demand. It didn't say it was on demand. I think that 
under the most generous interpretation of the contract he could have 
kept it for whatever a reasonable time was after that, and what a 
reasonable time was we don't know. But he said he didn't require 
him to agree to pay it back at any definite time and he got it interest- 
free. I would say that Mr. Schiffer looks to me, on Mr. Herman's testi- 
mony, more like an eleemosynary institution than a lawyer. 

Mr. Williamson. Frankly, I can understand your characterization. 

The Chairman. All right. We understand the characterization. 
Is there anything further ? 

Mr. Kennedy. I wanted to go back to the interview that our staff 
representative had with Mr. Schiffer. 

He stated that with the exception of some of the hotel bills that 
he paid for you, and he stated he was reimbursed, with the exception 
of that money he denied paying out any other money, either for 
you or for Mr. Cunningham. 

Could you tell the committee why he would deny making this pav- 
ment of $3,000 to you? 

(The witness conferred with his counsel.) 

Mr. Herman. I can only say, sir, and I am under oath, that I re- 
ceived $3,000 from Mr. Schiffer, and that is what I am telling you. 

The Chairman. You have not paid it back ? 

Mr. Herman. No, sir. 

The Chairman. He said he never let you have it, so I guess you will 
never have to pay it back. 

Mr. Herman. I hope you have that on record, sir. 

The Chairman. You would like to get out of paying it back? 

Mr. Herman. No, sir, I don't 

The Chairman. He says you don't owe it. 

Mr. Herman. I am not interested in what he says. I know I owe 
him that money. I hope he has foi'gotten it, if that is the way he 
takes it. But I will make sure he gets it back. I don't owe anybody 
any money. 

Mr. Kennedy. Do you know INIr. Abe Gordon? 

Mr. Herman. I think I met him once. 

Mr. Kennedy. When did you meet Abe Gordon ? 

Mr. Herman. Somewhere around — let me see. I met Abe Gordon. 
I am trying to place it, somewhere around in New York. I don't just 
recall where. 

Mr. Kennedy. When ? 

Mr. Herman. I can't recall, sir. 

Mr. Kennedy. In the last 2 months? 

Mr, Herman. No, no. Quite a ways back. 

Mr. Kennedy. How long ago ? 

Mr. Herman. Many months ago, I think. 

Mr. Kennedy. How long ago? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16171 

Mr. Herman. I couldn't recall. 

Mr. Kennedy. Did you go to his office ? 

Mr. Herman. I don't know where his office is. I don't know what 
local he belongs to or anything. 

Mr. Kennedy. Do you know Mr. SchitFer is Abe Gordon's attorney ? 

Mr. Herman. No, sir. 

Mr. Kennedy. You don't know anything about that? 

Mr. Herman. No, sir. 

Mr. Kennedy. Did Mr. Schilfer mention to you that any of this 
money was coming from Abe Gordon ? 

Mr. Herman. No, sir. We never talked as to where it came from. 
I asked him, and he called me and said, "I have it for you." I met 
him and he gave me the money. 

Mr. Kennedy. Did you visit Mr. Hoffa here at Teamster head- 
quarters ? 

JSIr. Herman. Many times. 

Mr. Kennedy. Since August of 1958 ? 

Mr. Herman. Yes, many times. 

jMr. Kennedy. Did you ever visit him at his apartment at the 
Woodner Hotel ? 

jNIr. Herman. Maybe I might have once gone up there. That is 
about all. I have nothing pertaining to his apartment. I don't bother 
him in his apartment, sir. 

Mr. Kennedy. Who else was present when you went to his apart- 
ment ? 

Mr. Herman. I don't think anybody was. I don't recall. It has 
been quite a while. I don't go to his apartment. If once I went 
there, I couldn't recall who I went with or if anybody was there. 

Mr. Kennedy. This isn't too long ago — less than a year. 

Mr. Her^ian. For that matter, sir, there are things that happened 
last week I couldn't remember. I will be frank with you. 

Mr. Kennedy. Did you ever give Mr. Cumiingham any cash ? 

Mr. Herman. At no time did I give him cash. He gave me cash 
occasionally when I bought a plane ticket or train ticket for him. 
He reimbursed me. 

jNIr. Kennedy. Wliere did he get the cash ? 

Mr. Herman. I don't know where he got the cash. He gave me 
the cash for anything except when when I took him with me at the 
hotel. Otherwise, that is the only thing. 

Mr. Kennedy. Did you ever offer to pay any of the pickets who 
were picketing the monitors because they had not received action in 
their case ? Did you ever offer them any money ? 

Mr. Herman. What monitors ? 

Mr. Kennedy. The pickets that were picketing the monitors. 

Mr. Herman. Plow long ago was that, sir? 

Mr. Kennedy. October of 1958. 

Mr. Herman. Where was it, sir? 

IVIr. Kennedy. Here in Washington. 

Mr. Herman. I mean whereabouts. 

Mr. Kennedy. Well, did you ever pay, did you ever offer 

Mr. Herman. I am trying to recall when it happened. 

Mr. Kennedy. It is in the last 3 months. I am trying to get an 
answer from you as to whether 3^ou ever offered them any money. 



16172 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Herman. If you are talking of in front of the monitors' build- 
ing opposite the Ambassador, I passed by one time with Mr. Cunning- 
ham. I saw some men picketing. I said, "What are you here for?" 
They said they got a lousy deal from the monitors. I personally did 
not know them. Mr. Cunningham knew them, because previously he 
was with that 13 dissident group. Therefore, he laiew them. I don't 
even 

Mr, Kennedy. Just answer the question. Did you offer them some 
money ? 

Mr. Herman. Oh, surely. Any time it is on a picket line, sir, I will 
always offer them money to buy them coffee, and sandwiches, anything 
else. I ha.ve been on a picket line many a time, and I have gone 
hungry. 

Mr. Kennedy. How much money did you offer them ? 

Mr. Herman. I offered them $20 to buy coffee and cake, and they 
said, "We are not taking money from anybody. We are going to sleep 
in the car if we have to all night." 

Mr. Kennedy. Mr. Cunningham also offered them money ? 

Mr. Herman. No, sir, I offered them the money. 

Mr. Kennedy. For a man who is on relief, and who is borrowing all 
this other money and getting cash from his attorney, having his at- 
torney and the Teamsters Union pay his bills, it seems you are in a 
rather peculiar position to be offering some pickets $20. 

What are you going to say ? 

Mr. Williamson. There is no question before the witness at/this 
time. 

(The witness conferred with his counsel.) 

Senator Ervin. Was Mr. Cunningham to pay you back the $2,500 
you handed him ? 

Mr. Herman. Mr. Cunningham will pay me back the $2,500 because 
he has certain things coming to him that amounts to 10 times that 
amomit of money, sir, that I know of, both in New York and 
Washington. 

Senator Ervin. Did he agree to pay it back ? 

Mr. Herman. I know he will pay me back. There is no agreement. 
Between friends, sir, I don't ask an agreement. 

Senator Ervin. I have a bad practice. When I ask a witness a 
question, I keep asking it until he answei'S. 

Mr. Herman. Fine; I will always answer you. 

Senator Ervin. The question is, Did Mr. "Cunningham agree to pay 
that $2,500 back? 

Mr. Herman. Yes, sir. , 

Senator Ervin. Did he give you a note? 

Mr. Herman. No, sir. He gave me a handshake, sir. I believe in 
a handshake more than I do all the paper in the world. If that 
isn't any good, you can keep your paper, and it is easv, it can be torn 
up. 

Senator Ervin. Furthermore, if you just use a handshake, nobody 
can trace it, either. 

Mr. Herman. I am soriy, sir. I don't like that thought. That is 
not nice. I may be just a public citizen, sir, but I don't think you as 
a Senator should hit me with that. 

Senator Ervin. Do you have a bank account of vour own ? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16173 

Mr. Herman. Yes, sir ; $200 or $300. Do you wish to see it ? 

Senator Ervin. No. 

Mr. n?:KMAX. I have a 10-cent clieckinjx account. 

Senator Ervix. I was just wonderino; why you didn't put this $2,500 
in the bank account and give a check to Mr. Cunningham for it. 

Mr. Hkrman. I figured to use it, sir. 

Senator Ervin. How long did you keep it ? 

Mr. Heriman. Well, I got that around — I am trying to figure out 
the dates — I gave it to Mr. Cunningham on December 9. I received 
it around October — 10-7-58. That is the exact date I remember I 
put onto that note. 

Senator Ervin. In other words, you kept at least $2,500 in cash from 
October 7, 2 months and 2 days ? 

Mr. Herman. Yes, sir. In my home. I can't tell you where be- 
cause I am afraid somebody might come next time and get it. 

Senator Ervin. But you take your checks for your disability and 
social security and put them in a banking account ^ 

Mr. Herjsian. Pardon ? I expected to use that, sir, for an operation, 
sir. 

Senator Ervin. Can't you pay a doctor with a check just as easily, 
and have proof of it afterwards ? 

Mr. Herman. Somehow or other I couldn't get an opportunity. I 
laid in that home of mine, sir. I have been up and down. AYhen 1 
get spasms, I can be right in the middle of the street and have to be 
carried across. I am telling you, I never deposited it. 

Senator Ervin. This was last fall, wasn't it ? 

Mr. Herman. This was around October, October 7. 

Senator Ervin. You weren't having any spasms or anything in 
November when you were down in AYashington about this matter. 

Mr. Herman. Senator, I stayed here at the Woodner, I must tell 
you, and for a number of days I couldn't even leave the Woodner. I 
was in pain and I stayed here because I couldn't even get out of it. 
For a number of days I had no dealings with Mr. Hoffa or anything 
else, but stayed here because I couldn't get out. 

Senator Ervin. You weren't brought down here from Flushing on 
a stretcher, were you ? 

Mr. Herman. Senator, I have been offered all sorts of things, 
crutches and everything else, and I have gotten out of that. I am 
trying to be mobile. 

Senator Ervin. You didn't answer the question. I asked you if 
you were able to walk around to come down here, ride on an airplane, 
a train, a bus, or something, and you were able to walk along the 
picket line 

Mr. Herman. I was in no picket line. 

Senator Ervin. You are able to walk along where they saw the 
picket line. 

Mr. Herman. I was walking from the Ambassador across the street 
to where the monitors were, with Mr. Cunningham. 

Senator Ervin. So the fact that you kept this money in cash 

Mr. Herman. I didn't keep it on me, sir. I had it home. I didn't 
take the money around with me. 

Senator Ervin. That is what you said. 

Mr. Herman. I did not. I left it at home. 

36751 O— 59 — pt. 43 10 



16174 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Senator Ervin. You said the reason you didn't put it in the bank 
was because you were helpless on your back and having spasms or 
something. 

Mr. Herman. No ; you have it twisted. Senator. 

Senator Ervin. That is what you said, as the reason you kept it. 

Mr. Herman. Well, I kept it home. 

Senator Ervin. That is all. 

Mr. Kennedy. When you registered at the hotel and registered as 
Moss Herman and One, as you did on two separate occasions, who was 
the "One"? 

Mr. Herman. Mr. Cunningham, I guess. 

Mr. Kennedy. He was there with you ? 

Mr. Herman. Yes, sir. 

Mr. Kennedy. Why didn't he put his name down ? 

Mr. Herman. He would either come a little later, possibly, or he 
came with me and it was just registered that way. 

Mr. Kennedy. Mr. Herman 

Mr. Herman. He wasn't footing any bill, and to be frank with you 
he did not know that Mr. Hoffa was paying the bill, and I didn't 
like him to have the idea at the time, either. 

Mr. Kennedy. Who is Sam Matinsky ? 

Mr. Herman. I once got a call from the man and I refused it. It 
was a collect call. 

Mr. Kennedy. You never talked to Sam Matinsky ? 

Mr. Herman. I talked to him because I understood he was supposed 
to be a Harry Matinsky, who was a former secretary of 584. When 
I found out it wasn't, I wasn't interested, 

Mr. Kennedy. What did he want — Sam Matinsky ? 

Mr. Herman. He just called me. I don't even recall who the fel- 
low is. He said he wanted to give me some information about what 
happened in New York. 

Mr. Kennedy. About what ? 

Mr. Herman. I get a few calls in reference to that. About 584. 

Mr. Kennedy. He wanted to give you information on that? 

Mr. Herman. Something of that sort. 

Mr. Kennedy. Did he want to give you information on any other 
matter than that ? 

Mr. Herman. I don't know. I talk to quite a number of people. 
I don't recall just what he wanted. 

Mr. Kennedy. Did he want to give you any other information, 
other than information on local 584? 

Mr. Herman. Possibly. I don't recall exactly wliat it was. 

Mr. Kennedy. You don't remember anything else ? 

Mr. Herman. I don't recall. 

Mr. Kennedy. Did you ever talk to him other than that one time? 

Mr. Herman. I have refused his calls, collect calls, to the hotel. 

Mr. Kennedy. Did you ever talk to him other than that one time? 

Mr. Herman. Well, the only way I could have talked to him would 
be if he came througli as Matinsky. 

Mr. Kennedy. Well, did you talk to him then ? 

Mr. Williamson. Would you excuse us just a moment ? 

(The witness conferred with his counsel.) 

Mr. Herman. I don't recall, Mr. Kennedy. 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16175 

Mr. Kennkdy. You don't recall ^ 

Mr. Herman. No: I don't recall. I am awfully sorry; I don't re- 
call. I know 1 turned down his colle€t calls a couple of times. 

Mr. Kennedy. And Harry Matinsky is who? 

Mr. Hf:RMAN. He is a former secretary of local 584, New York. 

Mr. Kennedy. That is all. 

The Chairman. Is there anything further ? 

Mr. Kennedy. Did Mr. Harry Matinsky come down here to Wash- 
iuirton and stay at the Woodner Hotel with you ? 

Mr. Herman. Yes; he came down with some information, and he 
stayed once at the Woodner Hotel. 

Mr, Kennedy. Did you make various trips throughout the country ? 

Mr. Herman. No, sir; I have never been except to Washington. 

Mr. Kennedy. Did you go to Miami on one occasion? 

Mr. Herman. Only one occasion that I explained to you to Miami. 
That was the only occasion. I came back the next day because I 
couldn't get transportation back the same day. 

Mr. Kennedy. You were reimbursed for that trip by the 
Teamstei-s ? 

Mr. Herman. I was reimbursed for the trip. I spent $104 for 
that trip and was reimbursed for it. 

Mr. Kennedy. By the Teamsters ? By Mr. Hoffa ? 

Mr. Herman. By Mr. Hoft'a, not the Teamsters. 

Mr. Kennedy. Mr. Chairman, just on the point of Sam Matinsky, 
we have here two toll slips which indicate that tliere were two calls 
that were made to Mr. Moss Herman by Sam Matinsky, and which 
were accepted by Mr. Moss Heraian. In one conversation they talked 
for 6 minutes. 

The Chairman. So that you may verify or deny them, it appears 
here that he called you from New York on December 23, 1958. Do 
you recall whether he talked to you at that time? 

Mr. Herman. I recall one time. Senator. If it was another time 
that I told you, I don't recall. I know he has called collect and I have 
refused to accept them except when I thought it was Harry Matinsky 
and I accepted. 

The Chairman. It shows here he called you a^ain on December 29, 
1958. 

Mr. Herman. Well, that is possible. I say, I don't recall the second 
time; that is all. I don't recall the second time. 

The Chairman. At that time it shows that he talked to you 6 
minutes. Do you know about that ? 

Mr. Herman. Well, I say possibly it could be true, but I don't recall 
the time. Senator. 

The Chairman. Do you recall the purpose of the call? 

Mr. Herman. Just merely giving me some information as to what 
is going on in New York amongst the joint council, et cetera, and so on. 

Mr. Kennedy. Did you receive any other money from any union 
official since August of 1958? 

Mr. Herman. No moneys at all from anybody. 

Mr. Kennedy. Did you receive any other moneys from any attorney 
other than the amount of money that you discussed here? 

Mr. Herman. No, sir. 



16176 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Mr. Kennedy. Did you receive any money from any other source 
since Auofust of 1958 otlier than the moneys that you have discussed 
liere tliis afternoon, either in loans, ^ifts, or as payments? 

Mr. Herman. Well, I took out a loan of $480, or rather, for Cun- 
ningham. He needed $800 to get his car out of trouble. My son-in- 
law, I have the note here, on which I am paying $20 a month, and 
Mr. Cunningham he paid the last month's note on it. That was for 
$480, and $800 I got from Mr. Matinsky, and added the other for $800. 

Mr. Kennedy. That is those two loans. Other than that, the money 
that you discussed here this afternoon, did you ever receive any gifts, 
loans, or payments from any other individuals from the period 
August 1958 to the present time? 

Mr. Williamson. Do you mean excluding his regular pension? 

Mr. Kennedy. Yes. 

Mr. Herman. Not that I can recall, Mr. Kennedy. 

The Chairman. Where is Mr. Schiffer? 

Mr. Herman. Where is Mr. Schiffer? 

The Chairman. Yes. Do you know ? 

Mr. Herman. Well, his office is at 32 Broadway. 

The Chairman. New York? 

Mr. Herman. Yes, sir. Room 200. 

Mr. Kennedy. Did you talk to him today? 

Mr. Herman. No, sir. 

Mr. Kennedy. Did you talk to him yesterday ? 

Mr. Herman. No, sir. 

The Chairman. When was the last time you contacted him? 

Mr. Herman. I have called him on and off. I don't recall. I have 
called him on and off a number of times. 

The Chairman. When was the last time you called him? 

Mr. AViLLiAMSoN. May I talk to him a moment? 

The Chairman. Well, let the witness/just tell me. 

When was the last time you talked to him? 

Mr. Herman. I could have spoken to him a couple of days ago, 
sir. I don't recall. I make many calls, sir, as my chart will show 
you, if Mr. Kennedy or yourself have the phones. 

The Chairman. If you called him 2 days ago you would remem- 
ber it. If you talked to him on the telephone 2 days ago you would 
remember it. Your memory is not that bad. Did you talk to him 
2 days ago ? 

Mr. Herman. Possibly I did. 

The Chairman, I am not talking about "possibly'". Did you? 

Mr. Herman. Two or three days ago I guess I did. 

The Chairman. Where was he then? 

Mr. Herman. I S])oke to him at his home, Rockville Centre. 

The Chairman. Rockville Ontre? 

Mr. HER:\rAN. Yes, sir. I couldn't get him at his office. I called 
him at Rockville Centre. 

Mr. Kennedy. Have you talked to him here in Washington at all? 

Mr. Herman. Since when? 

Mr. Kennedy. In the last week? 

Mr. Herman. He hasn't been here in AVnshington in the la.st week. 
I haven't seen him. 

Mr. Kennedy. You have not? 



IMPROPER ACTIVITIES IN THE LABOR FIELD 16177 

Mr. HuoiAN. As far as I can recall. I haven't seen him. 

Mr. Kknxedy. AVe have been tryin<r to l(K'ate him, Mr. Chairman, 
and have been unai)le to reach him in the last 2 days. 

The Chaikmax. Is there anythino; further from this witness? 

Mr. Counsel, the Chair Avill direct you to pursue this matter further. 
We have listened to some rather fantastic testimony here this after- 
noon. I do not know the full si<>nificance of it, but it is fantastic, 
some of the things that took place, acc()rdin<r to this testimony. 

I am instructing you to direct the staft' and pursue the matter fur- 
ther and let us see if we can get the truth out of this, with a full 
answer to it. I think we are going to find that some of this money 
has been handled so loosely, and that it comes from a source that this 
committee will be definitely interested in. 

I would like to have Mr. Schiti'er brouglit before this committee and 
interrogated about it. Some of this is fantastic. It has been humor- 
ous, that is true, at moments, but it is also e.-iually fantastic. 

Mr. Kexnedy. It is correct, Mr. Chairman, that we have estab- 
lished the fact that Mr. Moss Herman's bills, as well as Mr. John 
Cunningham's, on occasion, have been paid out of Teamster Union 
funds. 

Mr. Hermax. Mr. Chairman, may I correct that, please? 

I don't know what it is, Mr. Kennedy. At no time has any of my 
bills — I don't know what the errors are, but I want it definitely under- 
stood that if the Teamsters or any other group would pay my bills, I 
would have nothing to do with it. 

Mr. Kexxedy. Mr. Herman, the bills have been paid by the Team- 
sters Union. 

Mr. Herman. Then it is an error, Mr, Kennedy. 

The Chairmax". It may be a fact, 

Mr. Hermax. If it is a fact, then it is not correct. Mr, Hoffa took 
it out of his pocket in paying those bills. He earns a good enough 
salary, sir, and that is one of the reasons I accepted it. 

The Chairmax. But I don't believe anyone believes Mr. Hoffa is 
paying bills out of his own salary. 

Mr. Hermax. It better be,jii" I want no part of it. 

Mr. Kexxedy. Beyond that, there is the money of Mr. Moss Her- 
man's bills at the Woodner Hotel, and there is no question but what 
they are being paid out of Teamster Union funds. 

There might be a question raised about the cash that Mr. Hoffa 
gave you continuously during this period of time when you had this 
association with Mr. John Cunningham. But there are bills at the 
AVoodner Hotel, as well as John Cunningham's bills at the Woodner 
Hotel, which were paid out of Teamster Union funds. 

This is the same time that Mr. Cunningham was bringing this 
action against Mr. Godfrey Schmidt, and Judge Letts; and the 
Teamsters Union, under Mr. Hoffa's direction, with Mr, p]dward 
Bennett Williams, was bringing a contrary action in connection with 
Judge Letts, That is what has been established. 

The Chairmax, We will jjet Mr. Schiffer here. 



16178 IMPROPER ACTIVITIES IN THE LABOR FIELD 

The committee will stand in recess mitil 10 :80 in the morning. We 
will convene in room 3302 in the New Senate Office Building. 

(Members of the select committee present at time of recess: Sena- 
tors McClellan and Ervin.) 

(Whereupon, at 5 p.m., the select committee recessed, to reconvene 
at 10 :30 a.m., Wednesday, February 4, 1959, in room 3302, New Senate 
Office Building.) 



APPENDIX 



Exhibit No. 214 




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10180 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Exhibit No. 223 




IMPROPER ACTIVITIES IN THE LABOR FIELD 



16181 



Exhibit No. 223A 



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Exhibit No. 223B 



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16184 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Exhibit No. 226 



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Michigan Conference of Teamsters Welfare Fund 



FRANK E. rrrasiMMONS 



2741 Tiumbull Avenue 
DetMlt 16. lficiu0an 

woodward 1-8835 
April e, 1952 



ladualilal Ttvtmm: 

J. HOWARD MINNICH 



Dr. Leo Perlmaa 

17 E* Prospect Avenua 

Mount Vernon, Ne* York 

tear Dr. Perlman: 

Ra: Itiehigan Conference of Teamsters 

I «ould like to teke this opportunity to point out 
something to you, which sight prevent future difficulty 
for the Welfare Fund and yourself. 

Frequently, correspondance dealing with adjustnients 
in the Policy are addressed to Mr. James Hoffa, Prealdent 
of Local Union #299, when technicality it should be 
addreosed to the Trustees of the Welfare Fund. 

I bring this to yo^ir attention as your letter of 
April 1, 1952 regarding premium adjustments, which 
should be In our files, was not addressed to the Trustees. 
The Trustees are the only ones able to adjust premiums. 

I hope you will understand the reasons for writing this 
letter to you and that in the future under such circua- 
stances where the purpose of correspondence is to establish 
a record, that it will be addressed to the Trustees. 



Sincerely yours. 




Samuel Schwartr ^l^^t;/^ 

lacHiGAN confeinEnce of 

TEAMSTERS WELF'ARE FUND 



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IMPROPER ACTIVITIES IN THE LABOR FIELD 
Exhibit No. 229A 



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16186 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Exhibit No. 229B 



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Exhibit No. 229D 






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Exhibit No. 229E 



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36751 0—59 — pt. 43 17 



16190 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Exhibit No. 229F 



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16192 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Exhibit No. 230 






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Exhibit No. 233 




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S»natex Corporation 
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Chicago, Illinois 



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4«M OAKTON STREET SKOKIE. ILLINOIS 



INVOICE NUMBER 



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Psbruary 5, 1958 



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Round trip air - Midway to lilaml return op«n 



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I TO OUft INVOICI NUh 



VALIDATION STAMP 



DELTA AIR LINES. INC. 
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16194 IMPROPER ACTIVITIES 

Exhibit 



IN THE LABOR FIELD 
No. 234 





PAY to THE ORDER OP 

LINCOLN l^ATIONAL BANX^ 

lOT CHICAGO. ItVhV^^S f'l'l 

AfD. .Jk^EST C;,L{^. LXCH. In^jjl j 




IMPROPER ACTIVITIES IN THE LABOR FIELD 
Exhibit No. 235 



16195 




16196 



IMPROPER ACTIVITIES IN THE LABOR FIELD 




IMPROPER ACTIVITIES IN THE LABOR FIELD 16197 

Exhibit No. 236 





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Exhibit No. 237 



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Exhibit No. 238 



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IMPROPER ACTIVITIES IN THE LABOR FIELD 16201 

Exhibit No. 242 



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lt)202 IMPROPER ACTIVITIES IN THE LABOR FIELD 

Exhibit No. 242A 




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IMPROPER ACTIVITIES IN THE LABOR FIELD 16203 

Exhibit No. 246 



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.Receh/ed in Cash 




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