The endorsement on the check for May 3 is, again, another writer. And the endorsement for May 24 is, again, another writer

In this particular series of checks we have four different writers. The CHAIRMAN. You have five checks to the same person with four different persons endorsing them, according to your interpretation of the handwriting of the endorsement?

Mr. DOULDER. Yes, sir.

The CHAIRMAN. Do you find this as a wholesale practice?

Mr. DOULDER. Yes, sir. I have additional charts to show how wholesale it was.

The CHAIRMAN. You will be able to show how wholesale it was?
Mr. DOULDER. Yes, sir.

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

Mr. DOULDER. There are a number of flagrant cases where the person who signed the weekly timesheet differed from the person who received the check and still another person-that is a third personactually endorsed the check. That is, at least three separate persons were involved in one transaction.

1. The person or persons who prepared the weekly timesheet. 2. A second person who receipted for the check.

3. A third person who endorsed the check.

On my workpapers, these are characterized as "CDE" transactions, involving multiple fraud.

The CHAIRMAN. Do you have a chart for that?

Mr. DOULDER. Yes, I believe I have, Senator.

The CHAIRMAN. Proceed.

Mr. DOULDER. I have prepared a chart with figures for the combined centers 1 and 2, for the last full workweek in January, February, March, April, and May. It shows the total number of frauds committed, for each week, by each of the methods described above.

The CHAIRMAN. Do you have that chart?

Is this the chart to which you have referred?

Mr. DOULDER. This is the chart which I am referring to; yes, sir. The CHAIRMAN. Let it be printed in the record and marked chart G. (The chart follows on the next page.)

The CHAIRMAN. Proceed.

Mr. DOULDER. I would like to stress at this point that in every possible case where I have determined that the signatures appeared to be valid or inconclusive, I gave the benefit of every doubt to the validity of the transaction. Stated obversely, those that are labeled by me as fraudulent are flagrantly fraudulent. It is likely that of those 64 instances where there was no obvious fraud, a careful detailed examination would invalidate a number of them. For example, in some cases, some of the names were handprinted and the corresponding signatures were in script. I resolved all such doubts in favor of the validity of the transaction. In other cases-just a few-some documents were missing, perhaps a check or the timesheet or the receipt. In those cases, I presumed that the missing signature was valid.

Returning now to the summary chart, we see that in January there were 48 timesheets, matching receipts, and canceled checks. My examination revealed that there were at least 81 separate acts of fraud. It must be kept in mind that several of these sets of documents involved more than one fraud.

CHART G

*Last week of month Jan. - May 1968, Centers 1 and 2

Nonetheless, 60 of the 84 clearly contained elements of fraud and two of them were those cases where at least three separate persons were involved-one prepared the timesheet, a second signed the receipt and yet a third endorsed the check.

The next column contains the data for the month of February and each of the columns on through the end of May. As you can see, the percentage of fraudulent sets of documents progresses from a low point of 71 percent fraudulent in January through 75 percent in February, 95 percent in March, 98 percent in April, and 99 percent in May. The instances of multiple frauds-with at least three separate persons signing the timesheets, the receipt, and the canceled checkincreases from two in January to three in February, five in March, 24 in April, and 75 in May.

With regard to that single transaction which is labeled as being valid or inconclusive in May, I might add that is the timesheet for Edward Williams in Center 2 but that neither the voucher nor the check was available for examination. It was on the basis of giving every presumption of validity to the transaction that this was put in the category "valid or inconclusive."

I have another chart here which visually portrays in bar graph form the progression of fraud over these 5 months examined.

Senator JAVITS. Mr. Chairman, can I ask a question?

The CHAIRMAN. Yes.

Senator JAVITS. Mr. Witness, I just want to clear up one point. You speak of a certain very high percentage of fraud, the percentage being based on the number of timesheets, I gather. Is that correct?

Mr. DOULDER. It is the combination of timesheets, receipts, and endorsements on checks.

Senator JAVITS. I wonder whether you tried to break the thing down by individual recipients.

In other words, would it be a different percentage if we said that of the total number of people who signed timesheets, attendance reports, receipts for checks, and endorsements, of the total number of people who signed, the percentage of fraud was so and so.

What confuses me is that you might have 30 people on one sheet and 80 percent of those sheets might have one fraud. That might not necessarily prove too much.

I wonder, do we have any figure to show the percentage of fraud by the number of signatures that were actually on these various items? Mr. DOULDER. No, sir; but that could be worked out.

Senator JAVITS. What do you think about it? Do you think that would be a fair measure of the volume of fraud which was involved, rather than the fact that the timesheets, which might have 30 people

Mr. DOULDER. Senator, a timesheet would be one fraud, which would be (a), such as two or more writers on it. When I examined it and found there were two or more writers on the particular timesheet, I just

Senator JAVITS. When you speak of a timesheet, you speak of a timesheet of one single individual?

Mr. DOULDER. Yes, sir.

Senator JAVITS. So every timesheet contains only one individual? Mr. DOULDER. Correct.

Senator JAVITS. Therefore, if there was any fraud on that timesheet you thought it fair to classify that as a fraud and give a percentage based upon that because they were individual timesheets. Is that correct?

Mr. DOULDER. That is correct.

Senator JAVITS. That is what I wanted to know.

Mr. ADLERMAN. In other words, if I understand it correctly, if there were three different signatures on the timesheet, it was not considered three different frauds but it was considered one fraud for this purpose.

Senator JAVITs. And also, as I understand it, Mr. Adlerman, for determining the percentage of timesheets which had a fraud in them, you counted the whole sheet as one document.

Mr. DOULDER. Yes, sir.

Senator JAVITS. I just wanted it clarified.

Mr. ADLERMAN. If there were 20 signatures on one timesheet, if there were four that were fraudulent and 16 not fraudulent, we only counted it as one fraud.

The CHAIRMAN. Proceed.

Mr. DOULDER. I would like to turn for a moment to the documents for the month of May. They show some excellent examples of what I have earlier categorized as "total fraud" cases. The first 36 serially numbered checks, their receipts, and their corresponding timesheets were carefully examined. I have enlarged the first six of these. They are charts 1, 2, and 3.

The CHAIRMAN. Which one are you talking about?

Mr. DOULDER. The bar graph chart.

The CHAIRMAN. That will be chart H.

(The chart follows on the next page.)

Mr. DOULDER. That visually shows in bar graph form the fraud I have described.

The CHAIRMAN. That has been printed in the record. Give us an explanation of it so we will understand.

Mr. DOULDER. It is a bar graph chart taken from the figures of the table graph, showing in bar graph form the percentage of fraudulent and percentage of valid or inconclusive which is in white.

In the black are the fraudulent.

The CHAIRMAN. What does the next chart show?

Mr. DOULDER. I have enlarged the first six of these checks which represent a timesheet, the receipt and the endorsement of the check for six separate instances.

The CHAIRMAN. Which chart is that? I don't see any chart like that with six checks. You mean there are three charts?

Mr. DOULDER. There are three charts, each bearing two individuals. The CHAIRMAN. They will be numbered I-1, I-2, and I-3, so we can keep them together.

(The charts face this page.)

The CHAIRMAN. Give us an explanation of these charts, what you mean by them, what they reflect.

Mr. DOULDER. Let us look at the six timesheets, the six timesheets which are represented on the left of each chart.

The CHAIRMAN. We are on I-1 now, so we can keep them identified. Tell us about I-1, the Bruce Adams chart.