UTILITIES CORRUPT ELECTIONS, AIDE CHARGES

McMillin, Miles

Public Power News Utilities Corrupt Elections, Aide Charges By MILES McMILLIN SENSATIONAL charges of power trust interference with free political expression throughout the nation were hurled last...

...Doing Away With 'Obstacles' In order to carry on securities operations, Boehm asserts, it was necessary for the defendants "to engage in political activity in the various states in which North American Company had interests, as well as on a nation-wide scale, to control legislators and officers of the various states whose duties related to the utilities field, and do away with any and all obstacles encountered from time to time when those obstacles interfered in any way with the issuance and sale of securities...
...Robert M. La Follette, Jr., and "> former Gov...
...In Ohio, the petition sets forth, funds were used to elect governors and to obtain passage of state legislation and to prevent the City of Cleveland from expanding its municipal power plant, one of the most successfully operated in the country...
...William McClellan, chairman of the board of Union Electric...
...Several other high officials of North American and its St...
...In addition, Boehm charges, funds were used to influence federal appointments, and nominations of national political candidates, including the nominations for President...
...North American employes, he asserts, "were instructed, ordered and required by superior officers in the North American Company, under penalty of dismissal, to obtain funds for political purposes by means of kickbacks from attorneys, contractors and others, as well as by padding of expense accounts and salary kickbacks, which moneys so collected were used for political purposes, with the full knowledge and authority on the part of the North American Company, its officers, Sullivan and Cromwell, and Dillon, Read and Company...
...Louis circuit court that North American has used a $5,000,000 slush fund to influence elections and political appointments on a "nation-wide scale...
...John Woodbridge, vice president and chief counsel for Union Electric...
...La Follette, who like his brother was "in favor of strict regulation of public utilitiy rates, business and security issues...
...These practices, he adds, are still going on and are made possible by the influence obtained by political activity...
...In Illinois, the ex-utility executive charges, funds were used to defeat municipal ownership proposals in Centralia and Bell-ville...
...Other states specifically referred to are Missouri, Illinois, Ohio, Michigan, California, and the District of Columbia...
...According to the allegations, funds were also spent in a futile effort to defeat Sen...
...Edward L. Shea, president of North American...
...During the trial of Egan and the company in the roborated Boehm's testimony that perjury committed by both of them in the SEC hearings was committed on the advice of North American officials and attorneys...
...Louis when Frank J. Boehm, former $54,000-a-year executive vice president of the Union Electric Company of that city, named the North American Company, one of the nation's largest utility holding companies, and many of its present and former officers as defendants in libel suits which seek to recover $24,500,000 in damages...
...Carl Byoir, lawyer and public relations expert who was hired by North American during the SEC investigation of Union Electric...
...The petition names some of the most prominent figures in American utility and financial affairs...
...Practices such as those of which Union Electric was found guilty were required by North American St...
...Boehm, whose career as a utility executive came to an end two years ago when the Union Electric Company, a subsidiary of North American, was found guilty of corrupt practices, charged in his petition in the St...
...Public Power News Utilities Corrupt Elections, Aide Charges By MILES McMILLIN SENSATIONAL charges of power trust interference with free political expression throughout the nation were hurled last week in St...
...He also alleges that money was spent to accomplish the defeat of former Mayor Daniel Hoan of Milwaukee...
...A now disbarred lawyer has confessed to being the intermediary in the slush fund dealings in the former city...
...The petition recounts also the manner in which money was spent in Missouri to obtain favorable legislation and elect candidates...
...Louis subsidiary are named, as well as the partners of the Sullivan and Cromwell law firm...
...Clarence Dillon of Dillon, Read and Company, a New York investment firm which for years has marketed North American stock and bond issues...
...Prominent Financiers Named The former North American executive, who served a 10-month prison sentence for perjury in connection with a Securities and Exchange Commission investigation of Union Electric's slush fund activities, charges that he was made a scapegoat by his superiors in a conspiracy to manipulate the financial affairs of the North American empire for the "profit and personal advantage" of the controlling group...
...The petition asserts that in Wisconsin funds were expended in behalf of former Governor Walter Kohler and Julius Heil, the only two Republican candidates to contest successfully gubernatorial elections against former Progressive Gov...
...John Foster Dulles, prominent internationalist and member of North American's legal firm, Sullivan and Cromwell...
...Of special interest to readers of The Progressive, and especially Wisconsin readers, are Boehm's allegations that part of the slush funds were spent in an effort to defeat Sen...
...Among them are: Harrison Williams, Wall Street financier and chairman of the Board of North American...
...A Round Of Denials Funds were used in other states, Boehm asserts, for the same or similar purposes...
...Phil La Follette...
...Louis Federal District Court in the Spring of 1942, Boehm found support for his contention that Union Electric's corrupt practices were carried on with the knowledge and approval of North American officials from Albert Laun and J. D. Mortimer, both former employes of Union Electric...
...Philip F. La Follette...
...The San Francisco utility is owned by the Pacific Gas and Electric company, one of the North American brood whose name has been identified with some of the most vicious anti-public ownership drives on the West Coast...
...Boehm also charges that financial affairs of North American have been so manipulated as to bring huge profits to top officials and to the Dillon, Read firm, as well as for Sullivan and Cromwell...
...Others named are: James E. Fogarty, former North American president...
...Citing the vast operations of the powerful holding company, Boehm declares that the system has total assets of $1,500,000,000, but that control is held by officials owning less than one-tenth of one per cent of the common stock with a market value of less than $120,000...
...His suit charges a conspiracy to "defame, slander and libel" him by seeking to make it appear that he created and handled the Union Electric fund...
...Boehm's sensational charges brought a round of denials from the officials whom he implicated in the vast conspiracy to undermine representative government...
...To conduct their political affairs, the petition states, "it was necessary to secretly obtain and expend large sums of money in such a manner that these transactions would not appear of record or be reflected in the books of the corporate or individual defendants...
...In Milwaukee, Wis., slush funds were used, the petition asserts, "to defeat Daniel Hoan, who was in favor of municipal ownership of utilities, for the office of mayor . . ." and "to defeat a proposal submitted to popular vote by the city of Milwaukee which, if successful, would have meant the acquisition by the city of Milwaukee.of the North American subsidiary...
...Laun also corofficials, the former utility official alleges...
...The $600,000 slush fund, which Union Electric and its president, Louis Egan, were found guilty of distributing, was part of the vast pattern of corruption carried on by the holding company, Boehm asserts...
...California, Boehm asserts, felt the impact of the slush fund avalanche when funds were poured into that state to defeat proposals for municipal acquisition in San Francisco and to influence the elections of governors and state legislators...

Vol. 7 • November 1943 • No. 48


 
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