cedure of informing you that anything you say in these proceedings may be held against you in some other proceeding.

Do you understand that?

Mr. BERMAN. Yes, sir.

Senator HARRIS. We inform you that you are entitled to counsel. Are you represented by counsel?

Mr. BERMAN. Yes; I am.

Senator HARRIS. Will you identify yourself?

Mr. SILVERMAN. Mr. Berman is a partner of mine but I am appearing for him as counsel, and my name is Matthew Silverman of the firm of Robinson, Silverman, Pearce, Aronsohn & Sand, 230 Park Avenue, New York.

Senator HARRIS. Mr. Berman, I believe you have been employed by FHA here in Washington on several occasions; is that correct? Mr. BERMAN. Yes, sir.

Senator HARRIS. Would you state the various times and positions of that employment with FHA?

Mr. BERMAN. I was originally employed by FHA in April of 1949, I believe, as an attorney-adviser in the FHA Legal Division.

Senator HARRIS. That lasted, I believe, until February 1, 1954? Mr. BERMAN. Through the end of 1953, I believe.

Senator HARRIS. And then were you employed again in December of 1954 to January of 1957 as an attorney?

Mr. BERMAN. In December of 1954 I was employed as a consultant originally and the work developed into a complete routine so I was then put on as an attorney, not an adviser at that point, but I was a supervising attorney and I remained in that position until June of

1957.

Senator HARRIS. Now, on May 4, 1956, I believe you received a letter from Mr. Max H. Goldschein of the Department of Justice, commending you for your assistance in the District of Columbia, Federal Grand Jury investigation of FHA matters in 1954; is that correct?

Mr. BERMAN. I remember receiving such a letter, and I can't state that was the date.

Senator HARRIS. I believe 6 days after that letter, on May 10, 1956, you received a written notice of demotion or intended demotion from the position of supervisory attorney-adviser to attorney-adviser for what was said to be incorrect and misleading statements to FHA concerning your affiliation with the law firm of Snyder and Berman.

Then by letter of June 5, 1956, you were advised that your demotion was to take effect June 17, 1956; is that correct?

Mr. BERMAN. Without verifying the dates, that action did take place; yes.

Senator HARRIS. What was the situation on those reported incorrect and misleading statements by you to FHA concerning your affiliation with that law firm?

Mr. BERMAN. When I came back to FHA in December of 1954, I was then a partner in a two-man law firm which was dissolved at that time by agreement.

The question of the impropriety arose from the fact that due partly to my negligence I did not see that my name was removed from the

office door. It was not removed from the office door, and at one point I was challenged on this and I went back to the office building and insisted it be removed and again through my negligence, I didn't check to see if it had been removed. In fact, it still was in being at a time when someone, I believe, filed a complaint with FHA that I was practicing law on the outside.

The decision of FHA was at the worst I was negligent in not removing my name from the door which was required by the Personnel Manual, and I received this temporary demotion but subsequently I was reinstated to my grade as supervising attorney.

Senator HARRIS. I believe that was August 3, 1956. You received a letter of commendation from the FHA Commissioner, Mr. Mason, and on December 30, 1956, you received a promotion which restored your salary to what it had been prior to the demotion; is that correct? Mr. BERMAN. Without verifying the dates, that is what happened;

yes.

Senator HARRIS. Then you were employed again by FHA, I believe, July 8, 1963, to February 28, 1964, as Associate Deputy Commissioner for Operations; is that correct?

Mr. BERMAN. That is correct, sir.

Senator HARRIS. And was that a new position? first appointee to that position?

Mr. BERMAN. Yes, sir.

And were you the

Senator HARRIS. What was the mission of that position to be?

Mr. BERMAN. As I understand from my conversations with the Commissioner, when he talked to me about taking on this position, the FHA was going to be reorganized in an atmosphere where the operating divisions, of which there are several, would be put under the supervision of one man and that would be the position of Associate Deputy Commissioner for Operations.

And so basically, the day-to-day decisions that the Commissioner did not have time to make might be made on other than the broad policy questions.

Senator HARRIS. Now in that position as Associate Deputy Commissioner for Operations, did you receive and deal with correspondence having to do with Barrington Plaza, an FHA insured project, in Los Angeles?

Mr. BERMAN. I would answer "Yes" and then I would like to clarify the "Yes." I received copies of all correspondence that left any of the operating divisions, and I did not read all copies. I can not say specifically with respect to Barrington Plaza other than the testimony this morning indicated that I did see some correspondence.

I do remember this, but I can't remember the dates that I received it and dealt with it.

Senator HARRIS. I hand you what has been marked as "Staff Exhibit B–123–A” which consists of a series of letters and other correspondence from FHA files from August 12, 1963, to February 20, 1964. Directing your attention to the first item in that series, you will see that is a letter dated August 12, 1963, from C. O. Christenson, Director, to Mr. Mossman, collection supervisor of John Hancock Mutual Life Insurance Co., in regard to the Barrington Plaza Corp.; is that correct?

Mr. BERMAN. That is correct. Senator HARRIS. Can you testify whether or not that is a true copy of the letter in the files of FHA?

Mr. BERMAN. I cannot testify it is a true copy. It appears to be and it is signed by Chris Christenson.

TESTIMONY OF ALPHONSE F. CALABRESE- -Resumed

Senator HARRIS. Mr. Calabrese, would you stand, please? You are the same Mr. Calabrese who has formerly testified in these hearings? Mr. CALABRESE. I am.

Senator HARRIS. And you understand that you are still under oath? Mr. CALABRESE. I do.

Senator HARRIS. I hand you what has been marked as "Staff exhibit B-123-A," and which consists of several items and ask you if each of those items is a true and correct copy of correspondence on file in FHA?

Mr. CALABRESE. They are, sir.

Senator HARRIS. They will be admitted as exhibit 133.

(Documents referred to marked "Exhibits Nos. 133 and 133A through 133N" for reference; exhibit No. 133 will be found in the appendix on p. 370: exhibits Nos. 133A-133N may be found in the files of the subcommittee.)

TESTIMONY OF STANLEY BERMAN; ACCOMPANIED BY COUNSEL, MATTHEW SILVERMAN-Resumed

Senator HARRIS. This letter dated August 3 will be a part of that. That letter, Mr. Berman, contains the notation that a carbon copy of it went to you; does it not?

Mr. BERMAN. Yes, sir.

Senator HARRIS. I call your attention to this. The second item will be exhibit 133-B and that is a letter from C. E. Mossman, collection supervisor of John Hancock, addressed to the Federal Housing Administration, and it is in regard to Barrington Plaza; is it not? Mr. BERMAN. Yes, sir.

Senator HARRIS. Do you know whether or not you had a copy of that letter?

Mr. BERMAN. I would doubt very much. The copy of the original does not show any copies being sent, and they would not know of FHA's internal distribution of copies.

Senator HARRIS. I refer you to the next item, which would be 133-C, memorandum dated September 11, 1963, from C. O. Christenson to Mr. James Berry, director, FHA, in Los Angeles, and it shows that a carbon copy was sent to you; is that correct?

Mr. BERMAN. Yes, sir.

Senator HARRIS. And that is a memorandum having to do with Barrington Plaza Corp.; is that correct?

Mr. BERMAN. That is right.

Senator HARRIS. The next item we will refer to as 133-D, which is a memorandum dated October 10, 1963, from Mr. C. Franklin Daniels to Mr. James Berry, in regard to Barrington Plaza. It shows on the second page, I believe, a carbon copy to you; is that correct?

Mr. BERMAN. Yes, sir.

Senator HARRIS. Í refer you to the next item, which will be 133-E, and that is a letter dated October 18, 1963, from Mr. James Berry to Mr. Franklin Daniels; is that correct?

Mr. BERMAN. Yes, sir.

Senator HARRIS. Í refer you to the second paragraph of that letter, which says:

Last week Mr. Stanley Berman, associate deputy commissioner of Washington, D.C., discussed a default on this project with us. After hearing our opinion, he suggested that we write you a letter stating our recommendation to this default problem. Therefore, we have withheld action on your October 10, 1963, letter pending your decision on our recommendation.

Do you recall that conversation and the facts as stated in that paragraph?

Mr. BERMAN. After reading this memorandum, yes, I do remember that conversation.

Senator HARRIS. I will refer you then to the next item, which will be 133-F, which is a memorandum from C. O. Christenson to James W. Berry, Director, and it also has to do with Barrington Plaza, and it shows, does it not, a carbon copy to you?

Mr. BERMAN. Yes; it does.

Senator HARRIS. It was dated October 23, 1963; is that correct?
Mr. BERMAN. Yes, sir.

Senator HARRIS. The next item is 133-G, dated October 28, 1963, memorandum from C. Franklin Daniels to Stanley Berman, Associate Deputy Commissioner for Operations. It has to do with Barrington Plaza also. Did you receive that memorandum, Mr. Berman?

Mr. BERMAN. I don't remember receiving it but I would say I did. Senator HARRIS. The first paragraph relates to a conversation which Mr. Daniels says, as of that date, October 28, 1963, that he had with you the preceding week, concerning this project.

Do you recall such a conversation?

Mr. BERMAN. I recall conversations and I don't remember if it was that week or not, but this is a current memorandum and I would say that is probably when it took place.

Senator HARRIS. The next item is 133-H, and it is a memorandum dated November 6, 1963, from C. Franklin Daniels to Mr. James Berry, relating to Barrington Plaza, and it shows a carbon copy to you; does it not?

Mr. BERMAN. Yes, sir.

Senator HARRIS. The next item is the memorandum dated October 31, 1963, which will be 133-I, from James Berry to C. Franklin Daniels. Did you see a copy of that?

Mr. BERMAN. I would assume not. The office was not required to send copies of all of their correspondence but that just to Washington headquarters.

Senator HARRIS. The next item is 133-J, memorandum from C. O. Christenson, dated December 3, 1963, to James H. Berry, regarding Barrington Plaza, and it shows that you received a carbon copy of that letter; does it not?

Mr. BERMAN. Yes, sir.

Senator HARRIS. The next item, 133-K is a memorandum dated October 31, 1963, from James Berry to Mr. Franklin Daniels. Did you see a copy of that?

Mr. BERMAN. I would assume not, sir.

Senator HARRIS. The next is a memorandum dated December 11, 1963, which will be 133-L and it is from Raymond E. Lewis to the file. It is in regard to Barrington Plaza. Did you see a carbon copy of that letter or memorandum you have before you now?

Mr. BERMAN. Before now I do not remember ever seeing it.

Senator HARRIS. That is the memorandum previously testified to. I will read you the first three paragraphs and you may follow along. It says:

Telephone call, October 21, 1963, Mr. Franklin Daniels, assistant commissioner for multihousing operations, and Mr. Stanley Berman, associate deputy commissioner, Washington, D.C. from Mr. George Bradner, assistant director, and the undersigned regarding the default on captioned project.

I will skip the next paragraph and read the third one which says: Mr. Berman said he has considered our letter of October 18, 1963, but concurred in Mr. Daniels' decision of October 10, 1963. We then suggested that if this was their decision, we should at least make a mandatory requirement from Mr. Lesser for a first class management firm out of his own funds, as the overall management and display of apartments did not seem good. Mr. Berman and Mr. Daniels said this would probably be too severe a requirement for Mr. Lesser to be able to comply with financially. Mr. Berman agreed with us that this latter decision with our limited local office personnel would make our mortgage servicing requirements even more difficult, with a project of this size and complexity of ownership, but he said to do the best we could under the circumstances.

Does that state the facts as you know them, from that telephone conversation?

Mr. BERMAN. I must say that this is correct, that I don't remember the telephone conversation, but what is in the telephone conversation, if I had been in the conversation, is what I would have said.

Senator HARRIS. You don't deny that this memorandum would be correct?

Mr. BERMAN. No, I can't deny it because I just don't remember this specific telephone conversation. I can say that what was said there probably was said.

Senator HARRIS. You do remember you had conversations on the telephone about Barrington Plaza?

Mr. BERMAN. That specific telephone conversation, I do not re

member.

Senator HARRIS. I did not ask you about that specific telephone conversation, I said do you remember that you had some telephone conversations about Barrington Plaza?

Mr. BERMAN. No, sir.

Senator HARRIS. You don't remember any at all?

Mr. BERMAN. Not with the Los Angeles office, no, sir.

Senator HARRIS. You don't remember ever talking to the Los Angeles office?

Mr. BERMAN. In a meeting in the Los Angeles office on the way back from Honolulu, yes.