TESTIMONY OF RANDOLPH GRAY, ACCOMPANIED BY COUNSEL, LARRY S. DAVIDOW; AND TESTIMONY OF JOHN E. BOLMAN— Resumed

Senator CURTIS. Mr. Gray, yesterday we had testimony to the effect that individuals were ordered to work at the summer camp and retirement farms, and then if they failed to do so, paid fines. (At this point Senator Mundt entered the room.)

Senator CURTIS. It was also brought out in the hearings that the international board of the UAW made a finding that there was no system of fines. I would like to have you look at three copies of letters here and tell us what they are.

The CHAIRMAN. The Chair presents you what purports to be three photostatic copies of letters. One is a mimeographed copy dated January 14,1948, apparently signed by Richard T. Gosser, addressed to international representatives, full-time local 12 officers.

Another one is addressed to international representatives dated February 21, 1947, signed by Mr. Gosser.

The third is dated November 4, 1949, entitled "Interoffice Communication," signed by Mr. Gosser. Would you examine them and state if you identify them?

(The documents were handed to the witness.)

Mr. GRAY. Yes, I can identify them.

The CHAIRMAN. What are they?

Mr. GRAY. They are letters from Mr. Gosser's office in regard to the penalties people were going to pay for not working at the farm. The CHAIRMAN. They may be made exhibits 41-A, B, and C, in the order of their dates.

(Letters referred to were marked "Exhibits Nos. 41-A, 41-B, and 41-C" for reference and may be found in the files of the select committee.)

Senator CURTIS. Mr. Gray, you have examined those, have you? Mr. GRAY. Yes.

Senator CURTIS. In substance, do they support the contention that workers were assigned-that is, employees of the union-to work on the retirement farm and the summer camp, and fined if they failed to do so?

Mr. GRAY. That is correct.

Senator CURTIS. Mr. Gray, you testified yesterday that you first became a board member, and then you took over the duties as financial secretary, and then later were elected financial secretary. During that time, were you familiar with all of the business transactions that were channeled through the regular course of the union?

Mr. GRAY. Not in its entirety; no.

Senator CURTIS I say those that were channeled through the regular course according to the bylaws and the regulations?

Mr. GRAY. Oh, yes.

Senator CURTIS. You knew about the operation of the hardware store?

Mr. GRAY. Yes.

Senator CURTIS. In the first instance, it was owned by Mr. Gosser and Mr. Schultz?

Mr. GRAY. That is right.

Senator CURTIS. Later on, Mr. Gosser bought the entire thing?

Mr. GRAY. That is what I understand, yes.

Senator CURTIS Did the union, local 12, the Building Corp., the summer camp and farm, and other entities purchase supplies from the Colonial Hardware?

Mr. GRAY. They most certainly did.

Senator CURTIS. About how many employees did Colonial have, do you know?

Mr. GRAY. They had two or three there.

Senator CURTIS. Were other people working in Colonial at times that were paid by other sources?

Mr. GRAY. Yes. Sometimes they would sign Vernal Scott and a fellow named Connie Hatt; and, of course, Mr. Schultz himself would go out there.

Senator CURTIS. Who paid their salaries?

Mr. GRAY. The local union.

Senator CURTIS. The local union?

Mr. GRAY. That is right.

Senator CURTIS. In other words, while this conflict of interest was going on, the people on the union payroll were working in the store? Mr. GRAY. Yes.

Senator CURTIS. Who were allowed to make purchases from the store!

Mr. GRAY. There was quite a number of people. Some I don't even know personally because I just seen the names on some of the slips. It was supposed to be run through my office, but it seems any man and his brother could buy materials.

Senator CURTIS. Are you referring to purchases made for the general public or purchases made for the union.

Mr. GRAY. I don't know. It was supposed to be made for the union. I don't know what was done with the stuff.

Senator CURTIS. Did you yourself ever make any complaint to anyone in the union about the transactions of Colonial Hardware? Mr. GRAY. I have complained to Mr. Schultz. I have complained

to

Senator CURTIS. While he was associated with the hardware store? Mr. GRAY. Yes.

Senator CURTIS. And you were financial secretary?

Mr. GRAY. That is correct.

Senator CURTIS. In substance what would you say to him?

Mr. GRAY. I had complained the first time about the fluorescent lights. I didn't see why we should be paying double the rate because I had purchased these lamps originally, I mean the same type-as far as I was concerned for what purpose we needed-for 15 bucks from Commercial Electric, which is the electrical house on Adams Street at that particular time. I was told I had to get the lamps at the hardware store. I think I paid $27 or $28 for the same thing as far as I was concerned, because it was nothing but the two 40-watt bulb fluorescent lamp.

Senator CURTIS. You complained that the union was paying about $27 for a lamp in Colonial Hardware that they could have bought elsewhere for $15?

Mr. GRAY. Sure. The record in the local union will prove that if they didn't destroy them.

Senator CURTIS. What did Schultz say?

Mr. GRAY. He tried to tell me it was the better lamp. I said it is the same thing for what we have. We are trying to conserve money. It is strictly a two-tube 40-watt bulb. What is the difference? It throws the same light. To me I could not see any difference between the two lamps.

Senator CURTIS. I am going to hand you a copy of a document that has already been received in evidence. It is marked "Exhibit 20." I want you to look at it and I am going to ask you some questions about it.

(The document was handed to the witness.)

Senator CURTIS. What is that?

Mr. GRAY. It is a report that Mr. Gosser wanted me to send up to his office on what the cost of the summer camp was on a breakdown we had in our particular office.

Senator CURTIS. Who prepared it?

Mr. GRAY. The staff that was under my jurisdiction.

Senator CURTIS. This is items paid out of what fund?

Mr. GRAY. Out of the summer camp and farm.

Senator CURTIS. By the way, were all of these moneys banked in a common pool?

Mr. GRAY. The unit account was.

Senator CURTIS. What do you mean by the unit account?

Mr. GRAY. I think there was somewhere around 50 or 60 unit accounts. Of course, we kept them separate by a book entry and by check distribution on the number. In other words, if a unit was going to get a check we would type that particular unit's name on the right hand top of the check so it could be identified that it came from that particular unit credit account.

Senator CURTIS. But at the bank, did you have all those put in one? Mr. GRAY. Yes, it was what they called a pool account. You could draw on the other guy's money.

Senator CURTIS. It was possible that one unit might be overdrawn but still the check written on your books that was charged to that unit would be honored by the bank?

Mr. GRAY. That is right.

Senator CURTIS. By units, don't try to list all 60, what do you mean? Mr. GRAY. Different plants. Under an amalgamated local each plant is called a unit of the local.

Senator CURTIS. Was the farm a unit?

Mr. GRAY. Yes.

Senator CURTIS. So far as your setup was concerned?

Mr. GRAY. It was a unit. So was the summer camp a unit. Senator CURTIS. This exhibit 20 on page 1 near the bottom, there is a word struck out. Then it says "hardware items too numerous to list in account classification, $36,360.38."

Do you know what word was stricken out?

Mr. GRAY. I certainly do. It was the word Colonial.

The CHAIRMAN. The word what?

Mr. GRAY. Colonial.

Senator CURTIS. So when you prepared this, this showed Colonial Hardware items too numerous to list in account classification of $36,000. That meant that in this period of time covered the union had spent $36,000 with Mr. Gosser's hardware store.

Mr. GRAY. That is just on that particular item. I mean there is other items on there.

Senator CURTIS. There are other items?

Mr. GRAY. Sure.

Senator CURTIS. This was just the miscellaneous items?

Mr. GRAY. Yes. You don't know how to classify it. It was a part for a washer machine. The girls said they did not know how to break them down so they threw them together.

The CHAIRMAN. Tell us what period this covers. You have it dated February 3, 1948.

Mr. GRAY. As I recall, it was from the time they opened up the camp and the farm up to February 3, 1948.

The CHAIRMAN. When did they open it up?

Mr. GRAY. I think it was around 1946 or 1947 or somewhere in there. There is a record when they opened it up.

The CHAIRMAN. Maybe you can tell us. I want to know what period of time this covers. It is not very informative.

Mr. GRAY. I have some other records.

you exactly.

The CHAIRMAN. All right. Proceed.

I could look it up and tell

Senator CURTIS. Will you tell us as briefly as you can the circumstances which led to striking out the word "Colonial"?

Mr. GRAY. It seems that it kind of irked Mr. Gosser because I had inserted the word there. In fact, I didn't originally do that. The girls in the office grouped it together because I told them what Mr. Gosser wanted on the report. He complained about me having the word "Colonial" there, it was trying to show him up that he was hogging all the business for his hardware store. So he had me X it out. That is the reason for it being X'd out.

Senator CURTIS. Who was with you at the time it was presented to Mr. Gosser?

Mr. GRAY. I think Mr. Speidell and I believe Melvin Schultz. Senator CURTIS. Tell what happened in connection with presenting this list to him that he asked to have prepared.

Mr. GRAY. As I recall right I think I met Lloyd on the steps and I showed him the item. I said I suppose Dick will blow his top when he sees this particular item, because he has been critical of me mentioning the Colonial Hardware. Sure enough, when I got upstairs, he did.

Senator CURTIS. Mr. Gray, in referring again to the action of the international executive board when they investigated this, one of the charges made by these rank and file members was identified as allegation 20-J:

It is alleged that Brother Gosser issued orders that any vouchers containing his initials be processed immediately.

Mr. GRAY. That is correct.

Senator CURTIS. That is what?

Mr. GRAY. That is right.

Senator CURTIS. You say that is correct?

Mr. GRAY. It had to be processed immediately if he OK'd them. Senator CURTIS. The findings of Mr. Reuther's international board are, "No supporting evidence has been made to this allegation." That is the end of the quote. Now I want to hand you certain documents.

The CHAIRMAN. I hand you what purports to be carbon copy of a letter dated October 3, 1949, addressed to Howard Seren and Richard Gosser. I guess it is from Richard Gosser to Howard Seren. Would you examine it and state if you identify it?

(The document was handed to the witness.)

Mr. GRAY. Yes, I remember that. I can identify it.

Senator CURTIS. What is that?

Mr. GRAY. It is a copy of a letter sent to me by Mr. Gosser. Senator CURTIS. It is very brief. I believe it will save time to read it.

Mr. GRAY. I mean it was sent to Seren, but I got the carbon copy. Senator CURTIS. Who is Howard Seren?

Mr. GRAY. He was the president of the local at that particular time. DEAR BROTHER SEREN: I am sending you this letter with a copy going to the other two fellows signing the summer camp, farm, and pavilion checks from now on so there will be no misunderstanding. On the camp, farm, or pavilion I do not want any checks signed by you until I have written my initials in the corner. Then there will be no argument as to where the money is going because I will know.

Sincerely yours,

RICHARD GOSSER, Vice President.

Senator CURTIS. He was vice president of the union at that time?
Mr. GRAY. That is right.

Senator CURTIS. Did this relate to internal matters of local 12?
Mr. GRAY. Yes.

Senator CURTIS. You have been a long-time union official. Does a vice president have authority over the internal affairs, receipts, and expenditures of a local union?

Mr. GRAY. Under the constitution he is not supposed to have any, but the way they operate, he seems to have some in there where he does. In other words, the international seems to uphold him.

Senator CURTIS. So in addition to the conflict of interest in trading with himself, he had no lawful authority to tell the local where they should buy?

Mr. GRAY. He didn't have no actual authority, no.

Senator CURTIS. All right. Here is another letter.

The CHAIRMAN. The Chair presents to you a photostatic copy of a letter dated May 25, 1946, addressed to you apparently from Mr. Gosser. Will you examine it and state if you identify it.

(The document was handed to the witness.)

Mr. GRAY. Yes, I can identify it.

Senator CURTIS. What is it?

Mr. GRAY. It is a letter addressed to me from Mr. Gosser, who at that time was the regional director of the UAW.

Senator CURTIS. I believe it will save time if you read it.

Mr. GRAY (reading):

DEAR BROTHER GRAY: I believe it would be a wise thing for you to direct a letter to all concerned informing them that in the future no purchases are to be made for local 12 without the consent and authorization of Brother Schultz, and no purchases are to be made for the building corporation without the authorization of myself, even if it is just a 10-cent fly swatter. I think we should start putting on a little pressure in regard to this spending of money around here. Thanking you in advance for your cooperation, I remain,

Sincerely yours,

Senator CURTIS. What is the date of that?

RICHARD GOSSER.