the same was held, if the amount received or expended shall exceed the sum of fifty dollars, and every candidate for election at which such candidate was voted for, or with which such political committee was concerned, if the amount received or expended shall exceed the sum of fifty dollars file with the officers hereinafter specified a full, true and detailed account, subscribed and sworn or affirmed to by him, before an officer authorized to administer oaths, setting forth each and every sum of money contributed, received, or disbursed by him for election expenses, the date of each contribution, receipt and disbursement, the name of the person from whom received or to whom paid, and the object or purpose for which the same was disbursed. Such account shall also set forth the unpaid debts and obligations of any such candidate or committee for election expenses, with the nature and amount of each, and to whom owing. In the case of candidates for election who have previously filed accounts as candidates for nomination the accounts shall only include contributions,_receipts, and disbursements subsequent to the date of such prior accounts. If the aggregate receipts or disbursements of a candidate or political committee, in connection with any nomination of election, shall not exceed fifty dollars, the treasurer of the committee or candidate shall, within thirty days after the election, certify that fact, under oath, to the officer with whom the statement is filed, as hereinafter provided.

SEC. 6. Every such account shall be accompanied by vouchers for all sums expended exceeding ten dollars in amount. It shall be unlawful for any candidate, or treasurer of a political committee, or person acting as such treasurer, to disburse any money received from any anonymous source.

SEC. 7. It shall be unlawful to administer the oath of office to any person elected to any public office, until he has filed an account as required by this act, and no such person shall enter upon the duties of his office until he has filed such account nor shall he receive any salary for any period prior to the filing of the

same.

State committee..

Expenditures in behalf of Gov. Gifford Pinchot

State committee, unpaid bills__

(Cents omitted)

Pinchot for Senator, western committee (Pittsburgh)..

County committees...

Personal expenditures by Governor Pinchot_

CONTRIBUTIONS TO PRIMARY CAMPAIGN OF GOV. GIFFORD PINCHOT

In addition to Governor Pinchot's personal contribution of $43,767, his wife contributed $40,000, and his aunt, Mrs. Charles B. Wood, of Washington, D. C., $50,000; Amos Pinchot, $10,000; George B. Woodruff, attorney general of Pennsylvania, appointed by Governor Pinchot, $17,600. The total contributions made by members of the Pinchot family represent more than 70 per cent of the total expenditures.

EXPENDITURES IN BEHALF OF THE PEPPER-FISHER TICKET

It is impossible to state these expenditures accurately because of the uncertainty in amounts of unpaid bills, notes, and obligations, because of the mixed character of the campaigns conducted directly in Senator Pepper's behalf and for the whole ticket, and, finally, because of the possible overlapping of expenditures by State, regional, county, and special organizations.

However, the following compilation, based on the figures presented in evidence and in the official reports to the secretary of state of

Pennsylvania, photostatic copies of which were obtained by your committee, is felt to be as accurate as the circumstances and agencies at the disposal of the committee allowed:

Pepper-Fisher expenditures

(Expenditures exclusively for Fisher omitted)

George Wharton Pepper (personal expenditures) -
Pepper central campaign committee..

Western Pennsylvania Republican organization_
Republican citizens' committee..
Minutemen committee__

Patriotic League.......

Central Pennsylvania Pepper-Fisher committee..

Expenditures of Pepper-Fisher county committees reporting.
Total unpaid bills and unpaid notes...

Total..

CONTRIBUTIONS TO PEPPER-FISHER CAMPAIGN

The Mellon family contributed the acknowledged sum of $75,000, as follows:

Andrew W. Mellon, Secretary of the Treasury-
R. B. Mellon, his brother...

W. L. Mellon, his nephew ($22,000 cash and an obligation of $3,000) _ _ _

$25,000 25, 000 25,000

Joseph R. Grundy, president of the Pennsylvania Manufacturers' Association, and the controlling genius of the Pepper-Fisher ticket, placed at the disposal of his candidates' campaign over $400,000. These sums, in cash and notes, were ascertained by your committee from the reluctant testimony of Grundy and William F. Folwell, the treasurer of the Pepper-Fisher Republican citizen's campaign committee. The character of his testimony and of the transactions may be seen from the following passages:

The CHAIRMAN. Were letters sent out over your signature to various manufacturers in the State who were members of this association of which you were the chairman?

Mr. GRUNDY. No, no, I do not think so. I am quite sure there were not. The CHAIRMAN. Where were the moneys deposited which were collected by this committee; in what bank?

เ

Mr. GRUNDY. I take it that it was the Corn Exchange Bank of Philadelphia. The CHAIRMAN. The Corn Exchange Bank?

Mr. GRUNDY. That is simply because Mr. Folwell is a director in that bank, and I rather assume that is where he put the money.

The CHAIRMAN. Has that committee a deficit now?

The CHAIRMAN. Your moneys are exhausted, are they not?
Mr. GRUNDY. Yes; I take it they are substantially exhausted.
The CHAIRMAN. Who became responsible for these amounts?

Mr. GRUNDY. Well, I suppose primarily Mr. Folwell is responsible for them. The CHAIRMAN. Are the accounts outstanding yet, or have they been paid, and is there a deficit in a bank somewhere represented by a note on which money was obtained to pay them?

Mr. GRUNDY. I think there is probably both.

The CHAIRMAN. Both?

Mr. GRUNDY. Both.

The CHAIRMAN. Who was it that arranged with the banks for a credit? Mr. GRUNDY. Well, it was, of course, Mr. Folwell. He was the man who arranged for the money that is owing to the banks.

The CHAIRMAN. And who was to stand with Mr. Folwell?

arrangement about underwriting Mr. Folwell's obligations?

Mr. GRUNDY. He and I made a joint note.

The CHAIRMAN. For how much?

Mr. GRUNDY. $90,000.

What was the

The CHAIRMAN. When did you sign that joint note to the bank?

Mr. GRUNDY. It was probably somewhere around the 14th or 15th of May. The CHAIRMAN. That is just before the primary?

Mr. GRUNDY. Yes.

The CHAIRMAN. You needed about $90,000, and you and Mr. Folwell signed a joint note; to what bank?

Mr. GRUNDY. The Corn Exchange Bank. I know he got the money there. The CHAIRMAN. That was to get money to meet the bills which were coming in and had to be paid, and to prepare for some money for election day? Mr. GRUNDY. To pay the watchers on election day; that is what it was. The CHAIRMAN. $90,000 for watchers on election day in Philadelphia? Mr. GRUNDY. Yes.

The CHAIRMAN. Had you signed some other notes before that?

Mr. GRUNDY. The committee had not-I mean, I knew Mr. Folwell had.
The CHAIRMAN. Had you signed notes with him before that?

Mr. GRUNDY. No, no.

The CHAIRMAN. This note for $90,000 is the first note you signed?

Mr. GRUNDY. Yes; that is the first note.

The CHAIRMAN. Did you sign any afterwards?

Mr. GRUNDY. No, sir; I did not sign any afterwards.

The CHAIRMAN. Who, of the committee, besides Mr. Folwell, went on this note that you had negotiated at the bank?

Mr. GRUNDY. Mr. Folwell and myself.

The CHAIRMAN. That is the $90,000?

Mr. GRUNDY. That is the $90,000.

The CHAIRMAN. But you said there were other notes?

Mr. GRUNDY. Yes; that Mr. Folwell has signed.

The CHAIRMAN. When did he sign those notes, before or after the $90,000 note?

Mr. GRUNDY. Both before and after.

The CHAIRMAN. Do you know the amounts of these notes?

Mr. GRUNDY. Yes; I think they aggregate somewhere about $300,000.

The CHAIRMAN. How much of that money was obtained after the $90,000 note was signed?

Mr. GRUNDY. Well, I really can not answer. His books would show that. It might be, say, half and half.

The CHAIRMAN. That is, you think that about $150,000 was obtained after the 14th day of May?

Mr. GRUNDY. Yes.

The CHAIRMAN. Was it obtained before the primaries or after the primaries? Mr. GRUNDY. Both, of course, Senator.

The CHAIRMAN. Since the primaries were over

Mr. GRUNDY. Yes.

The CHAIRMAN (continuing). Mr. Folwell has borrowed other sums from the banks?

Mr. GRUNDY. No; not from banks.

The CHAIRMAN. Where did he borrow it from?

Mr. GRUNDY. He borrowed it from me.

The CHAIRMAN. Oh! Well, now, let us get this note business straightened out, if we can. I am a little dull, anyway, about understanding financial matters, and perhaps everything else. When did Mr. Folwell make his first loan, either from you or from any other individual or from any bank?

Mr. GRUNDY I can not state specifically. I do not want to be held down to a date, but I think it was about the 4th of April. You see, Mr. Folwell went abroad and was unable to handle these finances and things, and so on, and the money had to be raised and I loaned his acting treasurer there, from time to time when contributions did not come in; he came to me and I loaned him what moneys he wanted from time to time.

8

SENATORIAL CAMPAIGN EXPENDITURES

The CHAIRMAN. Who was the acting treasurer?

Mr. GRUNDY. A Mr. Gorman, to whom I referred; Frank J. Gorman. The CHAIRMAN. The first loan that you made to Gorman, or to the mittee

Mr. GRUNDY. To Folwell; it was as treasurer.

The CHAIRMAN. You loaned the acting treasurer, for Folwell?
Mr. GRUNDY. Yes; and received receipts from Folwell.

The CHAIRMAN. Have you that receipt?

Mr. GRUNDY. Well, I have it, but I have not got it here.

The CHAIRMAN. You know, my subpoena to you was to bring every pa book, document, or letter throwing any light or tending to throw any light. Mr. GRUNDY. I will have a copy of it made for you. I would like to retain

original.

The CHAIRMAN. We would, of course, like to see the original, but we will ret

it to you.

Mr. GRUNDY. All right.

The CHAIRMAN. Can you tell us the amount of that first?

Mr. GRUNDY. I can not; it may have been seven or eight thousand dollars. The CHAIRMAN. You got a receipt for that, did you?

Mr. GRUNDY. Yes.

The CHAIRMAN. That was about April 4.

Mr. GRUNDY. I think that was the date.

The CHAIRMAN. It was the second one.

Mr. GRUNDY. I do not recall; from time to time as funds did not come in, contributions and bills did come in, they came to me and I gave them the money The CHAIRMAN. How many different advances did you make before yo signed the $90,000 note?

Mr. GRUNDY. I suppose seven or eight, maybe.

The CHAIRMAN. Can you tell us the aggregate of the advances?

Mr. GRUNDY. No; I would not want to; the record will show, Mr. Folwell wil show.

The CHAIRMAN. Can you approximate it?

Mr. GRUNDY. Well, I roughly said that probably half of this was loaned before that $90,000 and the other half since.

The CHAIRMAN. That is to say you yourself, then, before the $90,000 was loaned at the bank, obtained at the bank

Mr. GRUNDY. Yes.

The CHAIRMAN. You yourself had advanced the $150,000.

Mr. GRUNDY. I think it may be put that way for general purposes, that I could say, "yes."

The CHAIRMAN. That is within ten or fifteen thousand dollars, I suppose.
Mr. GRUNDY. Yes; that is right.

Senator KING. That is, you loaned it yourself?

Mr. GRUNDY. Yes.

Senator KING. You loaned this $150,000?

Mr. GRUNDY. Yes; before the borrowing of the $90,000.

The CHAIRMAN. Since the $90,000 was borrowed you have loaned further sums aggregating about $150,000?

Mr. GRUNDY. I think that is right; that is, in a general way, right.

The CHAIRMAN. So you were the angel of this enterprise to the extent of $300,000?

Mr. GRUNDY. If that is what you call it I shall be flattered.

The CHAIRMAN. From what other individuals were advances obtained?

Mr. GRUNDY. None that I know of.

The CHAIRMAN. Were there any other advances obtained that you know of, or have heard of, from any person or any institution except these sums of money you advanced and that were brorowed from the

Mr. GRUNDY. Corn Exchange

The CHAIRMAN. Corn Exchange Bank?

Mr. GRUNDY. No; unless contributions which McIlhenny handed in or his committee turned in.

The CHAIRMAN. But I am speaking about loans now.

Mr. GRUNDY. No.

The CHAIRMAN. Any contributions?

Mr. GRUNDY. I do not know of any other.

The CHAIRMAN. Then, if I understand you right, to summarize it, Mr. McIlhenny was engaged in getting contributions, the amount of which you do

not know, and you do not know what contributions have been obtained by the committee as a whole?

Mr. GRUNDY. No; I would not want to say.

The CHAIRMAN. You do know that you have loaned, or advanced to the committee, approximately $300,000?

Mr. GRUNDY. Yes, I do.

The CHAIRMAN. That in addition to that you signed a note with Mr. Folwell to the Corn Exchange Bank for $90,000?

Mr. GRUNDY. Quite right; quite right.

The CHAIRMAN. That about $150,000 of the amount that you obtained was advanced before the transaction with the Corn Exchange Bank which took place on what date?

Mr. GRUNDY. I should roughly say about the 14th of May.

The CHAIRMAN. About the 14th of May?

Mr. GRUNDY. Thirteenth or 14th of May; yes.

The CHAIRMAN. With your advance payment of $150,000 about April 4 you loaned seven or eight thousand, as you recollect?

Mr. GRUNDY. Yes.

The CHAIRMAN. Subject to correction?

Mr. GRUNDY. Yes, sir.

The CHAIRMAN. And after the 14th day of May, when you obtained the $90,000, you put up the other $150,000?

Mr. GRUNDY. Yes, sir; that is right.

Is that right?

The CHAIRMAN. Was any of that $150,000 put up before the primary day? Mr. GRUNDY. No; I think not. Well, it may have been; I would not want to say it was not before the 18th.

The CHAIRMAN. Your best recollection is that you put that last $150,000 up after the election, is not that it?

Mr. GRUNDY. That was put up as the bills came in, and they had to be paid; and it was probably before the primary and after the primary.

The CHAIRMAN. When was the last advance you made to the committee?
Mr. GRUNDY. I do not know; it may have been a week ago.
The CHAIRMAN. You have receipts for all of it have you not?
Mr. GRUNDY. Oh, yes; I certainly have (pp. 226–230).

Here follows in the same connection excerpts from the testimony of William H. Folwell, treasurer of the Republican Citizens' Campaign Committee, and a vice president of the Grundy Association of Pennsylvania Manufacturers:

The CHAIRMAN. When did you first become interested in Senator Pepper's campaign?

Mr. FOLWELL. The latter part of March.

The CHAIRMAN. Did you have anything at all to do with the raising, or planning the raising of funds before you went to Europe?

Mr. FOLWELL. No, sir.

The CHAIRMAN. Did you have anything to do with the raising of money, or plans for the raising of money, or conferring about the raising of money, at any time while you were in Europe?

Mr. FOLWELL. No, sir.

The CHAIRMAN. What date did you go to Europe?

Mr. FOLWELL. The 31st of March.

The CHAIRMAN. Is this your signature to the paper which I show you?

Mr. FOLWELL. That is a copy of it by stamp.

The CHAIRMAN. That is your rubber-stamp signature?

Mr. FOLWELL. I believe so.

The CHAIRMAN. The paper I have referred to in my question I will have marked as "Exhibit 35." It reads as follows:

EXHIBIT 35

REPUBLICAN CITIZENS' CAMPAIGN COMMITTEE,
Philadelphia, Pa., April 9, 1926.

Received of Joseph R. Grundy, $8,160, as a loan to the Republican citizens' committee.

S. Rept. 1197, 69-2, pt 2-2

W. H. FOLWELL, Treasurer.