Appropriations, Department of Justice

him by the auctioneer, he endeavored to get the goods, but he wa of course, unable to do so because they never existed. He therefor brought this suit against the United States in the Court of Clair for breach of the alleged contract of sale. We contended, amor other things, that the Government had canceled the sale on th ground of fraud, that the claimant was charged with notice of th limited authority of an agent of the United States, and that th laws of this country and not those of Great Britain governed t case. In order to secure evidence properly to defend the case was necessary to send the attorney assigned to it to England. H traveled extensively throughout England and interviewed scores British subjects. He also secured two witnesses from Belgium 1 make out the Government's case. The hearings were conducte at the office of the American consul general in London. As a resu of these efforts, sufficient evidence was secured to substantiate th Government's defense, and, after argument, the Court of Claim dismissed claimant's petition, stating in its opinion that "he car not be heard in this court to assert a claim so evidently based upo a design to get something for nothing."

This case is an excellent example of one taking considerable tim and money in the preparation of its defense. The travel expenses ( the attorney were, of course, a large item, then came the fees and travel expenses of the witnesses, and then the cost of reporting the testimony. In all, I should estimate that this amounted to betwee $2,500 and $3,000, payable from the defending suits appropriation But it is submitted that the judgment of dismissal more than counterbalances the expenditure.

Another case of considerable interest and importance was that d the J. J. Preis & Co. v. United States. This was a test case to ascer tain the validity of a so-called bonus for savings in connection with contracts for the manufacture of Army uniforms. The claimant was one of the many clothing manufacturers, who, upon the entrance of this country into the late war, began the manufacture of the millions of uniforms needed for the Army. The War Department, having obtained control over practically all of the available stock, furnished the cloth to the manufacturers for the uniforms to be made. After a great number of these contracts had been awarded it was believed that considerable yardage was being wasted by careless or inefficient cutting of garments. Therefore, with a view to obtaining as many uniforms as possible from the wholly inadequate supply of cloth, the policy was adopted of amending existing contracts to provide for the payment in cash of one-fifth of the value of the uncut yardage on comparing the quantities actually used in cutting with the allowances for the purpose listed in the schedules attached to the original contracts. As the contracts were completed from time to time, the amount of the uncut material was ascertained, and payments of the premiums for savings were made. A question having arisen in the War Department as to the validity of such amendments, the payments made as premiums were in most cases deducted from payments due on subsequent contracts. The claimant in this case having unsuccessfully contested the point before the War Department, brought suit in the Court of Claims for over $10,000 as premium on the savings in cutting less than 100,000 garments. The case was argued, and on February 12, 1923, the court rendered judgment against the

laimant, thus sustaining the position of the Government that the mendatory contract was void by reason of lack of consideration, nd also as being against public policy. In view of the millions of arments manufactured under these conditions, it can be seen that ad the litigation been successful the cost to the Government would ave been very considerable.

The committee may be interested in a case which held that the becretary of War may, in his discretion, refuse to accept a bid for Government property, even though such bid has already been acepted by the auctioneer appointed by the War Department to onduct the sale. I refer to the case of the Erie Coal & Coke Corpoation v. United States, wherein the claimant, pursuant to adverisements circulated by the War Department to prospective purchasers of surplus war material, entered its bid of approximately $25 per ton for certain sodium nitrate offered for sale at an auction conducted by an auctioneer appointed by the War Department. The goods were knocked down to claimant as highest bidder, and t thereupon deposited 10 per cent of the purchase price with the auctioneer and otherwise complied with all the regulations of the sale. Later the claimant demanded that the Secretary of War execute a formal contract, which demand was refused on the ground that the price bid was inadequate, being about $40 less per ton than the market price at the time. The claimant then brought suit in the Court of Claims for $1,208,370, the difference between the $25 per ton bid and the market price at the time and place, which was alleged to be about $65 per ton. The Government demurred to the petition, contending, among other things, that there was no contract of sale to claimant such as conformed to the requirements of section 3744 of the Revised Statutes, and also that the Secretary of War was legally vested with discretion and authority to reject any and all bids which did not return to the Government a fair and adequate value of the goods offered for sale. The Court of Claims sustained the Government's demurrer and dismissed the petition. The case is now on appeal to the Supreme Court.

Of course you must remember, too, that in disposing of cases are not the ones actually to dispose of them. The court does that, and the court is very seriously handicapped at the present time by a great flood of cases, and on several occasions during the present term they have been compelled to adjourn for a week in order to decide cases instead of hearing them. We are always ready to try enough cases to keep them busy, and as a rule they hear cases three days a week and decide cases three days a week.

INCREASE IN ESTIMATES.

Mr. SHREVE. You are asking for an increase of about $19,500.
Mr. LOVETT. Yes, sir.

Mr. SHREVE. Part of that is for traveling expenses, $2,000. The item for personal services seems to be increased from $25,000 to $30,000. How is that brought about?

Mr. HARRIS. That is for the employment of expert witnesesses very largely, witnesses who are used in these cases.

other personal services paid from this appropriation.

There are no

Mr. SHREVE. Printing and binding consumes a considerable portion of that, does it not?

Mr. HARRIS. No printing and binding is paid from this appro priation. You will notice under the second sub head there is ar item for stenographic work (job), for which the amount asked i $26,750. That is for commissioners and notaries public who tak testimony all over the United States. Attorneys go to the various places and conduct the examinations and the depositions are sent in It is listed under printing and binding, but in fact it is for reporting

the cases.

Mr. SHREVE. There has been a considerable increase in that work Mr. HARRIS. Yes; and they expect to take more testimony in 192 than in 1924. I might say now that in 1923 we had an original appropriation of $50,000 for this item, with a supplemental of $15,000. so that the total in 1923 amounted to nearly $70,000.

Mr. LOVETT. As an illustration of the way the expenses are increasing because of the vast number of cases we have now as com pared with the number of cases in former years, yesterday I had to have an attorney appointed especially to try 183 tax cases. Ther are all cases filed by the banks from coast to coast, and the banks in these cases are represented by one firm of lawyers.

They are going to begin taking evidence next week and continue taking it until all the cases are cleaned up. It will take fully a year

and this lawyer will be traveling all the time.

That is one instance of the increasing expense for traveling because of the increase of business.

THURSDAY, MARCH 13, 1924.

DETECTION AND PROSECUTION OF CRIMES.

STATEMENTS OF WILLIAM J. BURNS, DIRECTOR BUREAU OF INVESTIGATION; A. J. VAN BUSKIRK, CHIEF NATIONAL POLICE CHIEFS' CRIMINAL BUREAU OF IDENTIFICATION: AND A. J. RENO, CHIEF BUREAU OF IDENTIFICATION.

Mr. SHREVE. For the detection and prosecution of crimes, you are asking $2,184,688 for 1925. Your appropriation for 1924 was $2,245,000.

Tell us how you are getting along with that work.

GENERAL STATEMENT.

Mr. BURNS. Prior to 1908, there was no Bureau of Investigation in the Department of Justice, all agents and investigators, together with the bank accountants, were detailed on the request of said department from the Secret Service of the Treasury Department and from the Office of the Comptroller of the Currency.

Under the sundry civil act of May 27, 1908 (38 Stat. 328), such details were prohibited and on or about July 1, 1908, the first active steps were taken toward the organization of a force of investigators in the Department of Justice for the purpose of collecting evidence and making investigations.

Because of the provision of law mentioned above, and also as it appears for the purpose of systematizing the investigative work of the department, nine men were appointed, and these, together with six who were permanently employed by the department for the purpose of collecting evidence in matters involving violations of the peonage laws, seven who were permanently employed by the department in investigations in connection with land-fraud cases in the West, and 12 examiners who were charged with the duty of investigating the official acts, records, accounts of the United States attorneys, United States marshals, clerks of United States courts, and United States commissioners were organized in the general investigative service of the department under the designation of "The Bureau of Investigation.'

As a result of the changes set forth above, all the investigative work of the department was performed by persons connected with the Bureau of Investigation. Since the establishment of the bureau there has been noted from year to year a marked increase in the number of cases coming before said bureau, until it has grown to its present proportions represented by 52 field offices and 532 special agents and employees, irrespective of the force employed in the bureau at the seat of Government.

The growth and the volume of cases has been far in excess of the increase in personnel.

RESULTS ACCOMPLISHED DURING 1923.

Taking the complete fiscal year 1923, we find the following results accomplished by the Bureau of Investigation:

General Intelligence Division.

Investigations made involving impersonation of Federal officers__ Investigations of violations of Harrison Narcotic Act and results referred to Treasury Department for disposition -

Investigations of the activities of individuals charged with espionage_
Interdepartmental cases handled...

Passport applications and visé cases acted upon during the past year..
Passport applications searched..

Investigations of crimes on Government reservations..

1, 218

863

19, 590

2, 000

Individuals investigated during the railroad strike resulting in the arrest

of more than 1,200 charged with violation of the Federal injunction. 2, 000 Investigations of naturalization frauds___

Under the theft and frauds division the following violations are investigated:
Violation of the national bankruptcy act (sec. 29, A. & B.).
War Risk Insurance Act of October 6, 1917.

Thefts, embezzlement and possession of Government property (secs. 47 and 48, U. S. Criminal Code).

Frauds against the Government (mostly under sec. 37 U. S. C. C.).
Thefts from interstate shipments (Carlin Act, Comp. Stat. 8603).
Presenting false claims against the Government (sec. 35 U. S. C. C.).
Corrupt practices act (Comp. Stat. 188-198).

Use of mails to defraud (sec. 215, U. S. Penal Code).
Postal violations (secs. 179–204, U. S. Criminal Code).

Mr. HARRIS. No printing and binding is paid from this appro priation. You will notice under the second sub head there is a item for stenographic work (job), for which the amount asked is $26,750. That is for commissioners and notaries public who tak testimony all over the United States. Attorneys go to the various places and conduct the examinations and the depositions are sent in It is listed under printing and binding, but in fact it is for reporting

the cases.

Mr. SHREVE. There has been a considerable increase in that work. Mr. HARRIS. Yes; and they expect to take more testimony in 192 than in 1924. I might say now that in 1923 we had an origina appropriation of $50,000 for this item, with a supplemental of $15,000 so that the total in 1923 amounted to nearly $70,000.

Mr. LOVETT. As an illustration of the way the expenses are increasing because of the vast number of cases we have now as com pared with the number of cases in former years, yesterday I had to have an attorney appointed especially to try 183 tax cases. are all cases filed by the banks from coast to coast, and the banks in these cases are represented by one firm of lawyers.

Ther

They are going to begin taking evidence next week and continue taking it until all the cases are cleaned up. It will take fully a year and this lawyer will be traveling all the time.