Word: rfc
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...months, Arkansas Democrat William J. Fulbright has been gathering evidence for a full-scale investigation of RFC by his Senate banking subcommittee. Last week, as his committee began hearings, it looked as though he had struck pay dirt at the first swing of his pick. The case was that of the Texmass Petroleum Co., an oil outfit which got authorization for a $10,100,000 loan from RFC in 1949. The money has not yet been paid out and Senator Fulbright hoped he could prevent its ever being drawn...
Among the first witnesses was Comptroller General Lindsay Warren. He said: the loan to Texmass was "probably illegal [and] . . . without the authority of law." He based his opinion on subcommittee evidence showing that: 1) RFC examiners had turned down the loan as "not justified" because the company lacked the ability to pay it back in ten years, and 2) RFC's own review committee had bluntly reported that the loan would be "largely a bail-out of investors and certain creditors." Furthermore, out of RFC's five directors, the loan had been approved by a mere...
Gushing Out. What is Texmass and why did it want RFC money? The subcommittee learned that in 1945 a group headed by Dallas Oil Promoter Homer W. Snowden persuaded 350 wealthy Bostonians to invest more than $8,000,000 in separate oil projects, managed by Snowden and his associates. Later they formed the Texmass Petroleum Co. to take over the oil & gas properties in Texas. In the spring of 1947 Texmass borrowed $4,000,000 from Massachusetts Mutual Life Insurance Co. and $3,500,000 from John Hancock Mutual Life Insurance Co. Later, the 350 Bostonians put up another...
...Give RFC authority to make long-term loans and to guarantee more bank loans tosmall business...
From the $37,500,000 in loans he had received from RFC, Lustron Corp.'s President Carl G. Strandlund had paid himself a salary of $50,000 a year. Last week, after RFC had forced defaulting Lustron into receivership, Receiver Clyde M. Foraker's first act was to fire Strandlund, two $25,000-a-year vice presidents, and two other officers drawing $25,000 between them. Ex-President Strandlund had no immediate plans. Said his attorney: "Mr. Strandlund is resting." Unless a way is found to operate Lustron profitably, the next step would probably be liquidation. An RFC...