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vessel in Philadelphia and possibly other vessels were or
would be available for purchase in tho near future, g
STCRLN advised he made a trip to Philadelphia where
he exandned the log books of the vessel in question and took
a look at the general condition of the vessel in so far as
the decks, engine and other pertinent parts of the vessel
could be examined without going to the trouble of e detailed
survey. He said
ONASSIS that the
and, although he
vessel, the nave
purchased by USPC.
STOEEN advis
particular vessel in
existed and first lo
a meeting which took
Broadway, New York L
he was introduced to
STORENed at the tine he took a look
Philadelphia he did not even
arnud of the existence of thehe returned to ew York City and reported to
vessel appeared-to be in good condition '
is not certain, he believes this
of which he does not recall, was particular
subsequently
at this
know USPC
company at
place in the office of ONASSIS at 52_
ity, a few days later, at which meeting
EJFEHLCN by GHLSSES. He stated that
ONHSSIS, BbRdUSON and himself were the only individuals "
present at this nesting, at which tine 0NnSSIS rcouested _
to work with BERENSON in cleaning, repairing and fitting
' for general service the vessels to be purchased by USPC. ;" STORENrecalled that at this nnctin ONnSSIS and BLRENSON ~indicated USPC was buying at least E, and possibly as many
QB 7; vessels of the T-2 tanker type.
STOHBE adeised he went to work the very same day cf
the meeting to, as he put it, get the company in operation-
He explained that at the tinu of the meeting USPC had some
office BpaC6 at :2 Broadway separate from the office space
of ONASSIS! but that the extent of the furniture and office
equipment was two chairs. We said he immediately started
making arrangements to equip tho office space with furniture
and employ needed clerical and stenographic help. He added
that at tho time of his first rusting with BERENSON, USPC
had no operating eouipmsnt in so far as ships were concerned
hut that within a period Of three weeks, the first T-2 tumker
had been obtained and made ready for service at the Todd
Shipyards. I
__Hc advised that soon thereafter two additional taukers .
had been obtained and were being readied for service at the.I
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Bethlehem Shipyards, New York City when he received a telephone
call at Bethlehem Shipyards one day from BBRENSON inquiring
if he, 5TORnN, would like to become a director in USPC. STOREN
stated he told BhHEN$0N he would very much like to become a
director of the company aid felt it was quite a cemplinnnt.
On further cuestiening STOREN related that he felt
BERENSON offered him a directorship in the company because '
he, STOHEN, had been successful in getting the first tanker
ready for service in a short period of approximately three
weeks time and because BERENSON desired to tie him, STOREN,
closely to USPC for future consulting and supervisory services.
STOREN advised that about two days after receiving
the above telephone call he went to ONaSS1S' office, 52
Broadway, New York City to thank BISRENSON for making him a"
director of USPC, having first attempted to see BERENSON at
his own office. He stated that on centactin BERENSON onthis occasion '-"""NSOiii offered to sell himb shares of,USPC'stock for k STORAN said he was a so very happy"
about this and immediately agreed to accept the stock at the
agreed price inasmuch as he, §TQR5N, felt the stock was worth
more than per share. He said he felt that this gesture
on the part of;BaRhNSON was another way of expressing his
appreciation for the job he had done on the first tanker and
also was a manner of tying him to USPC for future services. In
fact, he stated he felt BtRnRSON was more or less giving the
stock to him as it was his impression the -shares of stock
would represent approximately lb interest in seven T-2 tankers.
STOREN was definite that the :, price was set
by BLREPISON and advised he paid for the stock by his own .
personal check payable to RsREN&0N, which check was drawn on
either the Pacific Nnti one]. ank, Sun Francisco, California,
or the Chase National Bank, New York City. STOREN stated that
he could produce the cancelled check in the event it becomes
xecessary at a'lator date.y;]c/2 He stated that he did not know who previously owned the-shares of stock which he purchased but that he presumed
BERENSOH_ewned them as the check in payment of the stock was
made payable to BnRENSON personally.
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He advised that he could not recall the actual date
when the stock was transferred to his name on the corporate'
books but believed it took place about the time of the first
directors Uneting of USPC attended by him in the late spring
or early summer of l9hB, at which meeting Admiral BOHEN, ~
BERENSON, COKKINIS, CARVER and a representative of the law
firm of Sherman, Sterling and Wright were present. He advised
he does not now recall what discussions took place at this
particular directors nesting but that the minutes would speak
for themselves. ' c
He also related that at the time of the above directors
meeting, or shortly thereafter, he saw a list of the stock-
holder of uspc which reflected sweats held-shares, corcmus
s exact number of shares no recalled!, with the remainingshares, CaRV1:.R held shares and BLRENSON held
s ock being in the name of a foreign corporation, the name of
which he does not recall but which company is commonly referred,
to as "0HASSIS* ccmpcny . He ccitea that he could not recall
the way he learned that this foreign compaiy was controlled by
ONASSIS. y . A . s
the cleaning, repairing ' ~STOREN advised he supervised
" and fitting for service of all seven tankers purchased by
USPC not including the two later obtained from_Pacific
Tankers, Inc.! and was paid for his services at the rate of
$5,000.00 per vessel. He advised the $5,000.00 figure was
suggested by BERENSCN and pointed out that the matter of fee
was not discussed at the beginning when OHASSIS originally
requested him to go to Philadelphia and take a look at th T-2
tanker there. In this connection he stated he had performed .-
services for ONASSIS for a number of years and on frequent
occasions performed minor services without charge to ONASSIS, 0
at least did not discuss the matter of fee until after the
services had been performed. .
STQREH advised he was principally interested in the
engineering and operational end of USPC and did not trouble
himself with the chartering and financing problems in con-
nection with the vessels involved. He stated he did not know
the source of USPC funds except that he does recall from over-
heuring discussions at various directors nnetings, that USPC _
borrowed monies from various banks. He stated he had no
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knowledge of any funds supplied USPC by ONASSIS personally_or
by the concern generally referred to as "0NASSIS' Company .
1 . currosn eves advises sA b7 92
the rela Q11 and sis that he had no snow_edge o- -"- -__e- 1 eionsh1§'E¬¬¬!%'!HE'?!¥Tbus parties in USPC prior to September
'~ 2?, 19h? as he did not become connected with the companyxntil
March of l9h8. However, he was acquainted with BERENSON,
STOREN and ONASSIS prior to that_tiuB. -J
With regard to BERENSON, CaRVER stated that during
.- World War II BaRENSON was an aide to General MARK CLARK and
' after he left military service he was employed by Grace Lines
- in their passenger shipping business, He does not know the
4- _ nature of BERENSON'S position with Grace Lines and is not
aware that BnRENSOH had previously been experienced in the
' operation of thnksr vessels.
He said that RERENSON told him that he had formed USPC
after he learned that the Maritime Commission was selling taikers
and it appeared to him to be a good opportunity because he felt
there would be a demand for these vessels. He stated that
H STOREN is Ngrwegian and is a ship repair expert, It is CARVER'S
understanding that'STOREN went to BERENSON to solicit shipp
; renuir business from USPC and it was as a result of this contact
-' With BEHLNSON that he became associated with USPC.I
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w.-L1He stated that STOREN had previously been known to
j. BERENSON because of his acquaintance in the shipping field.
CARVER stated that he had not previously known COKKINIS and
that COKKINIS had been brought into the company through ONASSIS.
., --Additional remarks of CARVER relating to his associa-
tion with BsRENSON and ONASSIS are set-forth under DEPARTMENTITLM NUMBsR 6. - . __._--*"""
7% Admiral m»soLn 0. H w N advises SA [0797I
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had no knowledge of any relationship existing between these
parties prior to that date.
NICOLAS COKKINIS, Vice President of USPC advised that
he was not acquainted with BLRENSON,.EUELEY, BOWEN, STOREN
and CARVER prior to the tine that he became associated with
USPC around May or June of 19h8.
Reletie to ONASSIS, hé first not ONASSIS in about
19h5 when he was employed by the MICHeEL EMBIRICOS Shipping
Corporation which was owned by COKKINIS' uncle, MICHAEL
EMBIRICOS, He advised that in about 19h6 he left the employ
of the above mentioned corporation in order to form his own
shipping company.
In about Eecember 19h6 he contacted ONASSIS with the
intention of getting the business of operating 0NASSIS' ships.
He advised that CHASSIS agreed to charter ships of his cor-
poration, the Central Anricnn Steamship Agency, Inc. about
February 19h?. Further infornution concerning the relation-
ship existing between ONASSIS and COKKINIS is set forth'underDEPARTMENT ITEM Nunsnn 76. - ' '
EEPARTMENT_IPEMNUMBh§:lO L
This item requests the identity of the law firm that
incorporated Petroleum Carriers of Panama. Full detail con-
cerning thie question is set forth in the lest section of this
report in the INTERVInW OF ROBcRT L. BnRbNSON.
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This item requests that thg amount gr T
money paid either by way of salary,expenses, dividends, advances
or loans to BEHENSON, COKKINIS, STOREN and CARVER by.USPC,
American Marine Corporation, Victory Carriers, Pacific Tankers
Incorporated and Trafalgar Steamship Company be determined. "
The foregoing information was ascertained by SA A! T from the books and records of the various concernsmentioned. LC results of this examination are being submitted 51%!
with this report as Exhibit B. e
e DEPABTPIENT IlEl'i,H1l?i4BER 13
This item requests that the amount of dividends paid
by each of the corporations named in Department Item Huber 11
be ascertained.
The following investigation was conducted by sA A! I-- in T ~ /L7-
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From an examination of the books and records of the
various companies mentioned, a schedule was prepared reflecting 92
the dividends paid by these companies during the years 19h8
through 1951, such schedule being submitted with this report and
designated as Exhibit C. e '
-In connection with this schedule, it is to be noted
that no dividends were paid by Victory carriers, American Marine
Corporation and Pacific Tankers for the years 19h? through 1951.-
An examination of tho minutes book of these companies further
reflected no declaration of dividends was made during this period.
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5' This item requests information relative to arrange- .
ence a d became the fi al ments whereby SlmB§pQ,_§pW_ n IoungwIInTDTS______gg »and chartering a,ents of theUHhSSIS-K0 g _ group. The/Item also requesis information relatfvelto arrangements for
' the payment of operating expenses of vessels in the U.S.P.C.
gg?gpr%gdtgdX§n§g§!by Simpson, Spence and Young hereinafter
The_§oll ing inve _ was conducted by SAS A!
and - .
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Young, advised ¬hathis firm has*ao"wr1£ten agreement difh
either the ONASSIS-KQNI§LIDl§_5f5U* or fH§i_. S. I, QLi££QDpto funetion astteir fisealnor chagtering agents. He stated
that the relation§hip_betyeegH§SI in New;Xork_and_ABI$IQILES -
_ 5. 0NASSIS'in'Neu York_began in:1a§:l§§Q or eagl1_lQh0, -
although"he believes that there may have een some prior
business association between ONASSIS and the London Office of
i SSY.IWYTI Y'92Y 136 I.
During the period comencing in 1939 or 19h0, SSY
provided space in their offices for various individuals -i
engaged in shipping operations. ONASSIS was One of these
' individuals and Mr. AUGENTHALBR recalled that at that time
- ONASSIS was operating three vessels which he believes were
registered under foreign flags. SSY acted as an agent in
chartering these vessels. Subsequent to World war II, ONASSIS
a through his various companies acquired other vessels and
generally expanded his operations; AUGENTHALER believes that i
the KONIALIDIS brothers Joined with ONASSIS subsequent to
World war II. SSY has continually operated as chartering
agents for the group to the present time. When the U. S. P. C. e
group commenced business, SSY also became chartering agents for
these companies. n
AUGENTHALER stated that no specific arrangements were
ever made for the payment of operating expenses or other expenses
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' of vessels for the two groups. Initially SSY wgs_g9t reimbursed
or the e;pensg_involved in making_payments pr_the accounts
.9_fI._the;-U--_5._R--C--arena.-s.>.f ,e<2_I"a§£1i°=~ °1" 1=.1.19ia:=¢-=3-'s'n . -'¢mx='B1Iia-=:..
At the resent timql:§§Y_rggeivesf$lj§UUTOO_per month from.Victorygarriers, Inaiaastimrséentlfor this egpgsse, Noneéffkthe otherzcompanies in the VT§.° F. C. iEicTup QI3___£1£!_Q§__QF___
the-companies in*the*foroign*group-pay SSY7FoF tHeso extra _ -
services rendered. '
with respect to payments of operating expenses and
other expenses made by SSY for the ships in the two groups
involved, Mr. AUGENTHALER advised that these payments were
made from the funds on deposit with his company to the credit
of the shipping companies. The procedure in making these
expenditures was to make the payment on specific instructions
of the shipping company in each case. In the early stages
- of the operation he advised that payments would be made against
the shipping company accounts on verbal instructions received
from a representative of_the shipping company. Later SSY
required e voucher or a letter requesting that e payment be
made and charged to the shipping company account.
- » Mr, AUGENTHALER advised that such payments should have
been made only against credit balances available to the shipping -
-- companies on the SSY books.
AUGEHTHALER emphasized that the firm policy at all
times was to make payments for the account of clients only
where a sufficient credit balance was present in the client's"
account to cover such payments. He stated, however that inadministcriru" thi 0 the firm placed trust i '
He said that the
rrsona scortain that a client had o
er - , a requested payment
ation of the facticmse vcs id no p
sufficient credit to cov
woul
AUGENTHALER advised that company policy with respect
to these groups was that the balances in the various accounts
would be considered as a package in determining whether or
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not there was sufficient credit to cover specific payments
requested by the shipping companies. He said that although -
one or more of the accounts in the two groups might have -
- debit balances the company would still pay out funds to be-
charged against these accounts provided that there was sufficient
c dit b l . i th th * t i h t f re a ances n e o or accoun s n t e groups o 0 feet the
debit balances and create-a not credit balance for a theaccounts. He stated that in view of Z>_51:1-1e fact that the members of the 1 m o r1 y Q!
p ndes personally, he was not positively sure that the accounts
of the U. S. P. C. group and the foreign group always had
sufficient credit balance to cover requested payments.
Mr. AUGENTHALER advised that since May, 1950 he and
the other members of the firm personally verified account .
'balances to determine that there are always sufficient credits
to meet expenditures. in addition, he advised that since _
April, 1951, all accounts handled by SSY are required to
maintain credit balances on an individual basis, and no
payments would be made for any company unless that companyls
account had a sufficient credit balance to cover the payments.
In this manner, each account in the U. S. P. C. group and the
_. foreign group is now required to maintain a credit balance.'
Mr. LUGENTHLLER was requested to furnish the ledger .
sheets for all of the accounts in the U. S. P. C. group and
the foreign group. He advised that upon advice of counsel he
would furnish these accounts only upon the permission of the
officials of the company whose account was involved.
Subsequently, Mr. AUGENTHALER made available for H.
examination the following accounts which SSY considered to
be the accounts in the U. S. P. 3. group?
- United States Petroleum Carriers, Inc,
Victory Carriers, Inc.
Pacific Western! Tankers, Inc.
Oceanic Transport Company4. 1 -
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Olympic Whaling Company, Inc.
Amcrican Marine Gorperation .
He also made available the following accounts which A
SSY considered to be those within the 0NHSSIS;KONIALIDIS group:
Sociedad Maritime Miraflores , ' '
Sociadad Industrial Maritime Financeria ArionaPanama, South America '
Gin, Uruguaya dc Gomercio y Maritime
Miramar Sociedad Anon.
Olympic 011 Lines, fanama
Balleneros Ltd., South America
Olympic Whaling_Compeny, South hmurica . _ . .,
_ - ~-_;- »;-Lf5 ;_f-t§v;~ 3-$51;-11'-;_1-1~f§fe1"¢"§ -1"?" "1 . ""1"'"'" T" '""""_i'Ti:."** .".i".'i' ""_"_'I ?it_.'i.'."_" .";": TI'1'.'"'
Magallencs Co, Panamena do Navegacion, South America 3
Sociodad Lrmadora Aristomenis, Panama, South America
Mr. AUGEHTHALER advised that the only account which
excluded is the account of Erinamar. He advised that
Erinamar is a Greek steamship company which has its headquarters
in Paris, France, and is considered by him to be part of the -~
ONASSIS-KONI&LIDIS group. Mr. AUGENTHLLER failed to obtain .
permission from the officials of Erinamar to have the accounts
of that company examined. He advised that the account of "
Erinamar was opened with SSY on Novenmer 6, 1950 and from the
inception of.this account carried substantial credit balances.
These balances were considered by the officials of SSY along -
with the other accounts in the U. S. P. C. and foreign groups =
in determining whether or not the combined balances of these
' accounts were in credit-kv -has been
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It is noted that it was daring the period subsequent
to May, 1950 that Mr. AUGENTHALER personally verified credit ;n~-
balances in these accounts, ' L . -;;.
These accounts were examined and the month ending
balances for l9h5 through 1951 were compiled for each company.
In compiling these balances consideration was given to the
fact that in the individual ship accounts of each company .
disbursements for the operation of the vessels were entered, -
on the subsidiary sheets at the time of disbursement and" -
transfer to the company control account in the month subsequent
to disbursement» In compiling the month ending balances of
the individual companies,this transfer of expenses was adjusted
in the company account to the month of actual disbursement. '
1" It is noted that while many of the shipping company
accounts reflect credit balances, according to the account 9
ledger, the adjustment of these accounts to charge the vessel
disbursements in the proper month resulted in a debit balance
in the account-
The monthly balances by companies within the U. S. P. C.
group were consolidated for a monthly balance of the entire '
" -group during the four year periods The monthly balances of
companies within the foreign group were also consolidated for
a monthly balance of that entire group. Details regarding
these monthly balances of the individual companies and of.the.
group are contained in agents work papers. A schedule of
the monthly balances of the U, S. P, C. group and the foreign
group and a consolidation of those balances was prepared and
is attached to this report as Exhibit H."
Balances as reflected in agents work papers for the
account of Erinamar for the period from March, 1951 through
December, 1951 were obtained from a work a er showin con-solidated balancue presrn tcd b SSY
accountant. ' _ ,,
It is noted that balances reflected on Exhibit H and
in agents work papers for the months of November, 1950 through
February, 1951 are shown to be overdrawn in substantial amounts.
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AUGENTHALER, as previously noted, stated that the
Erinamar account contained a large credit balance during this
period. He stated that such credit balances would offset the ~
otherwise debit balances of the group as a whole.
Examination of the ledger accounts relative to the -
U. S. P. C. group revealed that overdrafts existing at the
end of certain months in 19hB and l9h9, as reflected on Exhibit
H, were paid within a short period after the close of the month
in which the debit balance appears. For example, as of the and
of May, 19h8, the U. S. P. C. group accounts had a debit _
balance of $98,207.79. The ledger account reflects receipt by A
ssy of $90,000.00 to be s lied against this debit. Thisr8c01pttl&S on June 7, l9Eg. The balance of thisgoverdraft
of $5,207.70 was received by SSY on June 28. *
Overdrsfts existing at the end or June were cleared
by July 15, l9h6. Overdrafts existing at the end of July, 19hB
were cleared by August l6, l9h8, This same procedure was '
followed in connection with overdrafts at the end of other
months as reflected by Exhibit H. _
The ledger account of U. S. P. C. on the books_of SSY
reflects that on January 9, 19h8 a disbursement was made by
SSY to Chase National Bank in the amount of $202,650.00. A
letter dated January 9, 19h8 to the Chase National Bank .
instructs that institution to transfer $202,650.00 to the .
Riggs Bank, Washington, D. 0., in order that Riggs might issue
a check in the same amount to the Maritime Commission, The
books of SSY reflect that this disbursement was'reimbursed -..
by U. S. P, C. to SSY on January l3, 19MB. _ _"-
disbursement was made
$227,650.00 with
Riggs National BankOn January 13, 19h8, a similar
to Chase National Bank'in the amount of
instructions to transfer these funds to
in order that Riggs might issue a check in the amount of
$202,650.00 to the_Maritime Commission and a check to ROBERT
DUDLEY in the amount of $25,000.00. Payment was received by
SSY from U. S. P. C. in the amount of $20h,650.00 to be applied
I .
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W against this disbursement on January 16, 19hB. The remaining
1" . $23,000.00 was received from U. S. P. C. on January 21, l9hB.
92 Therefore, for the period January 9, 19hB to January 21, 19b5,
_ the U. S. P. C. accout at SSY was in debit position. -
,-
J , AUGENTHALER stated that there may have been times when
J an account and the group of accounts as a whole may have had a
debit balance due to a payment made by SSY for their account.
He stated, however, that this situation would only have occurred
when SSY knew that the funds to cover such disbursements were
v en route to them. 92
1 . AUGENTHALER further stated that SSY never had any e
security against the accounts of the U. S. P. C. or the foreign
"groups, stating that he never considered any such security to be
necessary. He stated that if he ever considered security to
be necessary, he would consider available credit balances in
nccounts within the group as such security, plus the possibility
of obtaining, maritime liens against the operating revonuof
vessels owned by the group. 'z ' _S
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This item derl aith bare boat charter of the
vessel .RICF.PFS to the Soconv-Vacuum O11 Company, Inc.,
and the assignin o" toe charter hire in connection therewith
to the Chase N"tlDU&l Bunk to retire a Q1,h00,000 loan on
this vessel
The followin investigation was conducted by
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The records of USPC reflect that the tanker
ARICKAREE was banaboat chartered in January, 19hB, for a
period of 12 years to Petroleum Carriers of Panama, Inc-,
and subsequently bare boat chartered to Socony-Vacuum
Oil Company until March, 1953. These records also reflect
that e portion of the hires received on this charter from
Socony-Vacuum Oil Company under the latter charter have
been set up as_a liability to Petroleu Carriers of 1
Panama. " .
Mr. H. 0. BECKER, Treasurer and Secretary of
USPC,advised that the charters and sub-charters on the
ARICKAREE were effective Jpril 2, 19h8, when this vessel
was delivered to Soeony-Vacuum Oil Company, as further,
discussed under Department Item Number 15. .
Marine Trans;;.g;t;;;.;L_;_n_l_ |r"!ivi.=:len, Soeony-Vacuum Oil !oMn_ 3',advised S.-J. ? that their records reflect
that the cha1tere owner of the 3QICKnREE is USPC and
that all charter hires on this vessel were assigned to the
Chase National Bank of the City of New York. He further
advised that their records contained no information on the
AHICKAREE'S being chartered by USPC to Petroleum Carriers
of Panama, although they have a photostatic copy of a
telegram dated April 22, 19h8, from the United States
Maritime Commission to USPC approving a bare boat charter
on the ARICKAREE to Petroleum Carriers of Panama for a
period of 12 years.%j,1
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DEBéBIH§NT 1T§MaEH353R 15 - . '
This item requests that it be ascertained if the charter
hire from the Aristophanes, Ariston and Calliroy was actually
paid to the National City Bang in retirement of the $3,750,000.00
loan made on February 25, 19uU or was the charter hire on the
Camas Meadows, Fort Bridger and Lake George substituted for the
original three foreign vessels. It further requests that the
dates of the charters on the Camas Meadows, Fort Bridger, Lake
George and Arickaroe be ascertained.
The fo11owinr' investigation was conducted by SAS-él!lanai ~
£9.51!
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1 ihe fcllowinc investigation was conducted by SA _
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HAROLD 0. BECKER, treasurer, USPC, advised that the
$3,750,000.00 loan made on February 25, 19MB by the National City
Bank was retired by direct payments by USPC to tho National City .
Bank. The loan account and cash disbursement records of USPC
reflects this loan was repaid by USPS from a special account
at the National City Bank, New York, and that the loan was fully
paid on September l9,Alqf% H0 stated that the effective dates
of the charters of USPC to Petroleum Carriers of Panama and sub- -
charters by Petroleum Carriers of Panama would be the same date,
that bcing the date of delivery to Sacony-Vacuum 011 Company
and commencing of the first voyage as follows:
Camas Meadows, March 19, 19b8, 12:30 p.m.
Lake George, March 18, 19hB, h:30 p.m. t
Fort Bridger, February 26, 19hB, 5:05 p.m.
Arickaree, April 2, 19u8, 1:05 p.m. '
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ITEM NUMBER 16 . ' - ~ QEP.-92.R';7r-121m
This item requests that when the AHICKAREE,
FT. BRIDGER, and [AKF GEORGE were chartered to Socony
Vacuum oil Company, were these new charters or were these
vessels assigned to previous charters entered into by
the Socon? Vaoun and the QEASSIS-KGEIALIDIS Group, with
respect to the foreign vessels ABISTOPBANES, ARISTON and
CALIIROY.
é The following investigation was conducted by '
Q _ Sm» i
- Marine Tr&n!!oL! Division, Sccony Vacuum Oi! Company,
A . r v -t -+ a 1@~a rhn fh as nnTnwAnww 2w Broadway, Hex-. it-.r.. Cl...'§,', a..v_-e.. ........ ..... .... .....e........_....
was a bareboat chartered by Socony on March 23, l9hB,
retroactive to February 20, 19b8, from USPC for a period
-of five years at a rate of $2 per dead weight ton per month.. _Q2.!
*r?" **"r"+"c*"# ""¢m-0n¥Februarye29;~i9h§~the»ehsrter~hire~on~this»@~~ ~~~ sea
vessel was assigned to the Chase National Bank and all
payments of charter hirehavebeen made to this bank. This
charter was a new charter and not a substitution and it is
still in effect. =
-
- d that _ _ A ,___W 10conyAVacuum advise - ,7 !- the FT. BIiIDGj-1! was chartered by PETCAP to Bioconyiionim " ' °
ncing; ' January 13, l9h8 for eleven consecutive voyages, comme
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on or about March 1, 19h8, at a rate of United States
Maritime Qommission Rate Qrder L38 plus 1b5%, gddendum
number 1 to this charter reflects that Socony must perform
one or more coastwiso voysges up to April 15, 19hB before
commencing with the tanker charter dated January 13, 19b8,
which was svbjcct to the approval of the United States
Maritime commission. The first three coastwise voyages
were to be at a flat United States Maritime comission rate,
By assignment dated February 25, 19hB, a1] charter hire
on the vessel was to be paid to the National City Bank.
This chsrter was terminated at the completion of the voyages,
The ARISTPPHANES, a Norwegian flag vessel, was
time chartered on October 2h, 19h? by Socony for a period
of five years from Sociedad Maritime Miraflores at a rate
of $h.2O per dead weight ton per month. On November 30,
1951 the SS FT. BRIDGES, the charter éwner being PETCAP,
was substituted for the ARISTOPHAHI5 at the same rate..
By agreement dated November 23, 1951, the charter hire dn
the FT, BHlDGIR was assigned to the National Gity_5ang,
A Instant charter is still in effect.
_adV1Bed that socony, on March 11, L719b8, signed a chsrter agreement with USPC, whereby the FJ
SS LAKE GEORGE was chartered to them on a consecutive voyage
basis for three years beginning with the date of the vessel
reporting for its first loading. The charter hire was to
be at United Status maritime commission rate plus 95% for
the first year and at a flat United States Maritime Commission
_ 1"at -. for the £1BOCi-I111 12111111 yrirlr, The charter hire Q11 1;}-19
vessel was assigned by USPC on March 11, 19MB to the National
City Bank-I
On April 21, 19h8 the United States Maritime
Comissioniuprovod the pplicutiwn or USFC to time charter
the LAKE GEORGE to PETCAP for ten years commencing on or -
about M1P¢h 30, 19hU. USPS then requested Socony to cancel
the consecutive voyage charter dttod H1PCh 11, 19h8 andI
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charter with PETCAP- USPC also canceled their
Ar nue +Qn h§nn +n +h¢ mn+Innn1 lfv nnnbU-L bin-11; U91. llJ.J. U UV U1-A92|I 130- UJ-92-Ill!-IIL ya.-I-I; guclnl' sign a new
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on May 12, l9h8, retroactive to April 30, 19b8,
socony signed a consecutive voyage charter for a period
"of three years"with PETCAP at United States Maritime
Commission rate plus 95% for the first year and a flat
United States Maritime Commission rate for the second and
third years, on may 28, 19MB PETCAP assigned all the
charter hire duo them on the LAKE GEORGE to the National
City Bank, retroactive to April 30, l9hB_ qhis charter
terminated on April 30, 1951. This was an original charter,
andcd not involve a substitution of a United States flag
vessel for a foreign flag vessel.
Sometime between the dates of August 25, 1951
and scptomber 25, 1951, the SS LAKE GEORGE and the SS
WILIIAM A.H. EURDTN, both T-2 tankers, were to be substituted
for-_the OI-Y1-{PIC TOIYCH, a 28,000 ton tanker owned by Olympic -
_ Oil Lines oi Panama, whioh tanker use under charter to '
Socony. Therefore, the charter on the OLYMPIC TORCH was
canceled and a new consccutivevoyage charter was made
between USPC and Socony for the vessel LAKE GEORGE on
June 10, 1951. This charter was to terminate on June 30,
1956. The charter hire rate was to be United States Maritime
Comission rote minus 20%. By assignment dated September 12,
l9Sl, all charter Lire on this vessel was paid to the
National City Bank of New York. The charter period for
the SS WIILIAN A.H. UURDEN was the same as for the $3 LAKE
GEORGE; however, the parties to the charter were sooony
Vacuu oil cunpany and Western Tankers, Inc. Subsequently
USPC was substituted as charter owner of the vessel. Thecharter hh~e,fwhich was st United States Maritime commission
rate minus 20¢, was assigned by USPC to the National cityBanko _
*'..1.ate-Li um. the vessel CALLIROY tic!1 * . '
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they did have it on a single voyage
19h? from its charter owner ARIONA.
3h, 19h? thecharter on November 19,
0n Qctober SS ARISTON was time
chartered by Socony for a periodaof five years at a rate
of #h,1O per dead weight ten per month, The vessel wasdelivered to Socony on November 1?, 1¢hB. Due to Soconyls
not being satisfied with the pcrfonnance of the AHISTON,
the vessel sf. n;.r>..v.:-1.92= s. "'1-IITOIJ was substituted on August 11+.
19h9. However, as CNASSIS wanted to convert the WHITON to
a whaler, the vessel SS CAMAS MEADOWS was substituted on
November §, 19h9. The charter hire, which remained the
. same as for the SS ARISTON, was assigned to the National
City Bank.
DEP!;RTI~IEI{1_ITE§§;EZ ragga gig 17__
This item requests that it be determined what
preliminary arrangements had been made prior to September 27,
19M? to borrow-the funds needed to pay for ten tankers, and
with what financial institutions were these arrangements
made.
- Fuil details in reference to the arrangements
for the financing of the ten tankers and what foreign e
citizens or corporations would he used to guarantee any
loans or to post co11etera1,is set forth in detail in the
last scctinr of this report in the interview with BERENSON,
1-
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B ' naezeanwral-agar: manta 118
%3.: This item re uests the amount of cash on deposit '1 by USPC on January 6, 19u%, and the amount de osited to theP. credit of USPC on January 7, l9uB, in connection with the _
- - sale of stock to Ariona or by cash advances.
, I r
* ' The_following investigation was conducted by '
- 2 saai A
3 § amount of $1,200 on deposit with the Rings National Bank,; Washington, D. 0., as of January 6, 19h8.1
I5 -= In connection with the sale of hO0 shares of l
u 1* common stock to Ariona, the records reflected the receipt E
P @ , of $100,000 in connection therewith on January 15, l9h8. - 5
E ; This amount was deposited in the regular checking account, __ Ii ., ' £1 _ The books and records of USPC reflected a total .
of USPC maintained at the National City Bank of New York._ - 0F: f
, I 1 Reference is here made to Department Item Number 1,
§ as previously set forth,which contains a schedule showing ---
1 I -15116J3%§.§.;.._§!Y11.Q.L1_D.1¬l._A1C1§L.§'C>11I3C.e...O.f..£1m:1st.,o1?..ell-- devosits -made» U - a--wey ; to the USPC regular account at the National Cit? Bank'fromnmf l
- ; January 9, 19h , to January cU, 19h8,
' From an examination or the Minute Book or U5PG,
H 7 it was reflected that the sale of h00 shares of stock to
~ Ariona was made on January 7, 19hB. However, as set forth
' previously in this item, the receipt of QlO0,000 for the sale
; _ of this stock was not deposited to the bank account until
E January.15, 19h8.
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pEPAHTUE§1;ITE HUMSEQW19
This item requests that the amount of money
on deposit by USPC as of February 25, 19b8, be ascertained.It further requests that information be obtained concerning ~
the loan agreenent with the National City Bank as of this
date, namely February 25, 19MB. 2 2
The'following investigation was conducted byMi 2
From an examination of the General Ledger, Cash
Receipts Journal and Cash Disbursements Journal of USPC,
the following bank balance was determined as of February
Account Number 1
Cash - National City Bank
of New York -
Regular Account $ 21,596.72
_ Accoun§_Humbqr_1l
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Further information in this respect is contained
in the interview with ROBERT L. BERENSON which is act out at
the end of this report-
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DEP'.RT1":EN'i' ITEM I-JUMIBER 20 - - i J___ _ __ _ __ _______ _
This item requests that it be ascertained whet official
of the National City Bonk represented the bank in negotiating the
loan agreement of February 25, 19h8, and further, to examine the
. bank's memoranda relating thereto. ' V
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QEPAHTMLNT ITEM HQ-BLQ 21 . :1,
This item requests that it be ascertained whether any
ayments were made at the Chase National Bank by USPC on the$1,875,000.00 note and, if so, how much was paid and was any
interest paid. .
The following investigation was conducted by SA_ !.- A C
Q-.-a--.- _._-.--'
-..-_ .It is to be noted, in connection with this item, the
Department refers to exhibit number 20 of the United States
Maritime Commission report, dated May 2h, 1951. This exhibitis a carbon copy of a promissory note dated March 2h, 19hB, in-
which USPC prom see to pay to the order of Ariona-the sum of~*%1¬8?5y00Q»O0~at~the~o£[email protected]£~the»-v Mi y of New York. The installment dates and amounts are set"
forth and the interest rate is stated as three percent per
annum 0
. ,_
HAROLD 0. BECLH, Treasurer and Assistant Secretary of
USPC, was questioned concerning the foregoing promissory note.
BECKER reviewed the records of USPC and produced a photostatic
copy of the promissory note in question and such photostat is
being submitted with this report as enclosure number 1.
It is to be noted, in connection with the promissory note
produced by BECKER, that it is dated March 29, 19MB and states
that USPC promises to pay to the order of Ariona the sum of
$1,875,000.00 and such payments are to be made at the office of
thé'company in the City of New York. BECALn also produced a ""
photostetic copy of a letter dated Januarv 26, l9h9, from Ariona,
to USPC. A photostatic conv of this letter is being submitted
with this report as enclosure number 2. This letter makes refer-
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ence to promissory notes held by Ariona, totaling $2,130,000.00
consisting of a note in the amount of $1,875,000.00 datedMarch 29, 19%B, a note in the amount of $165,000.00 dated
Jul 15, 19h and a note in the amount of $90,000.00 dated July 30,lqhg. This letter sets forth the method of payment in connection -
with these notes and states that the interest rate shall continue
at two percent from the original dates thereof. -
Mr. BECKER also produced phctostatic_copies of the notes
mentioned in this letter, namely the @165,000.00 note dated
July 15, 1905 and the $90,000.00 note dated July 30, 19hB.
Photostatic copies of these notes are being submitted with this
report as enclosure numbers 3 and h.
BECKER also produced a photostatic copy of a letter dated
April 29, 1909 addressed to ARIONA and signed by ROBERT L.
BERLNSON, President of USPC. A photostatic copv of this letter
is being submitted with this report as enclosure number 5.
This letter sets forth that the previous three notes mentioned
in the letter agreement of Januarv 26, l9uB is hereby cancelled,
and_in lieu thereof USPC agrees to pay Ariona the su of .
$2,130,000.00 by the maturity date of Januarv 1, 1958. The
interest rate is sot-forth as two percent per annum, and the
method of pavment is set forth.
From an examination of the books and records of USPC,
it was ascertained that the balance in the loan account with -
Ariona remained at $2,130,000.00 until September 10, 1951, at
which time check number 3796 dated September 10, 1951 in the
amount of $l,h00,000.00 was issued to Ariona. The present
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' ;;EPAR'1'1~1Em{_ ITEM aux-155a, 22
W Of
H to repayment, the
for repayment.
» CHARLES
had no agreement, .
'8 2the amounts a vance ,
amount repaid and the
AUGENTHALER, Partner,
written or oral, with-c .. . -._.-.--.--»-.-_.92-_._..-,,_i_._i ,
I070
1 I _
This item requests information as to what agreement =
SSY had with ONASSIS or ARIONA for the t
J'92 v-v-In run 1|-1-an nr-nr9211r92+ hf TTQUH Ir-|r92'111r1'l'rn:rLLALIUD ,|,92.Il, val!-4 uvuvuslv 92-1.1. uusv 1.-n1v¢.un-¢.¢¢cransfer or advance of H
the original amount
the understanding as
source of funds used
SSY stated that SSY
ONASSIS or ARIONA for
f f d f r the account of USPC- He the transfer or advance o un s o
' stated that SSY made_whatever payments ONASSIS or ARIONA
- directed them to make, but that each such nayment would be
= upon separate instructions, and would be charged against
0 credit balances on SSY'S books available to the company re-
questing such payment» .
AUGENTHALER stated that individual companies_within.
1 the ONASSIS-KONIALIDIS group might, at times, have had debit
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' packagq' to determine whether a sufficient credit balance
existed to cover a requested payment. He stated that it
was SSY'S policy that no payments would be made unless a
sufficient credit balance did exist. Their policy has been -
discussed previously under Doparment Item Number 13-
AUGENTHALER said that SSY never advanced its own -
funds for the account of USPG and therefore had no under-
standing with respect to repayment and had received no re-
In reference to the transfer of the $1,875,000.00 i
F by SSY to USPC at the instructions of ARIONA, this matter is
- discussed in detail under Department Item Number 21.
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NY 14.6 2507
DEPARTI92T1192!T ITPM mmeen g_3_
This item request that it be ascertained who
negotiated with the Metropolitan Life Insurance Company
for the note of $l,hO0,000 on the ARICKAREE, and further
if there was any security on this loan other than the mortgage.
Tho following investigation was conducted by=~»A»~i =-
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_]3ElPlaR_Ti-T.ENT_IT_EM QTUMBER 21+ .
This item deals with the negotiations at the Socony
Vacuu Oil Company in regard to the charters on the FT..
BRIDGER, LAKE GEORGE and ARICKAHEE with PETCAP. It is also
in reference to the part ONASSIS took in the negotiations
of the charters and in reference to the charter rate and to
whom Socony Vacuum Oil Company-paid the charter,
Marine Transport DiVis10n ; cuum ompany, 6
Broadway, advised SA A! that he recalled L
that in about December, l94¢ is . "BENSON came to see
Mr. F. R. PRATT, General Manager of the Marine Transport
Division, regarding
that time Mr. PRATT"iii
the of the ARICKAREE- AtIinto his office con-
aggremen was rea __
that timi. st nque tings Mr. BERENSON was accompanied
by Mr. A. S. ONASSIS and an oral agreement was reached on
February 20, l9hB, although the charter was not signed until .
March 23;'l9hBr tlhis charter_was conc1u§ed;with §$PQ. _ g gY_§f]dM. nir '
.92---..¢n._n-. -.-§--
that USPC is the chartered owner of the ARICKAREE and that s
the charter hire is paid to the Chase National Bank for the '
accoun under assi nment a reement dated Februar 20 T S E5 Y .019148. :tated that during these negotiations
he receive the mpression that BERENSON had little experience
in the tanker chartering field while ONASSIS was acquainted
with all matters regarding this type of enterprise,
wan» reference to the FT BHIDGEZR L15! . . . ,
Sttdotht this ship was substituted for the ARISTOPHANES.
because Socony was not satisfied with the performance of the
ARISTOPHANES as its_performance was below that claimed in "
the charter agrcemont...The substitution of the.FT. BRIDGER,
the chartered owner of which was PETCAP, was handled by Mr,
SCHAEFFER of USPC.d a erlee Q19!
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_ Lneg0t19_.t1on3 _PLTCAP in reference to the consecutive voyage charters of f7QZ!
the FT. BRIDGER and LAKE GLORGE to Socony, which arc now
terminated, wtro handled by A. S. O1=A';.SIS.
Correspondence in enclosure number 6, conccrninthe vessel LAKE utonct, confirmou tho statement e
Information pertaining to the charter hire and the- 7
charter rates on tho Ai£lGKitRF._-L, F'l=- BRIDGLR and GEQRGE is
contained in Department Item humbcr 16 and Department Item
Number 25,
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9s1?11RT1~;E1§Tl TE?-I mnwpsa 725
This item is in reference to the payment of the '
charter hire by Socony Vacuum Oil Company to the National
City Bank in retiring the mortgages on the FT. BRIDGER and
the LAKE GEORGE. It also deals with the accounting made "--
with respect to the total charter hire payments in excess
of the mortgage and to whom these funds were disbursed.
the records of qcuum Oilvailable byMarine Transpor u"v s on, o gjz!
charter hire on the FT. BRIDGER
d to the National City Bank underAccording to
and L. _assignment agreement with PETCAP, until December 7, l9h9, _
at which time the National City Bank advised Socony Vacuum
Oil Company that they no longer had any interest in the
charter hire moneys. By assignment dated September 12,
the charter hire on the ZAKE GEORGE was again paid by
socony to the National City Bank; and by assignment dated-
Novombor 23, 1951 the charter hire on-the FT. BhIDGEE_was
. also again paid by Secony to National City Bonk.
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QEPQHTMENT ITE@ NUMER 26
This item requests that it be ascertained the .
manner in which charter hire was paid on the vessel ARICKAREE.'
_ As previously set forth in Department Item Number 16the charter hire on the vessel ARICKAREE was paid by Socony-
Vacuum Oil Company to the Chase National Bank;
! The following investigation was conducted by &Ena;!SM _ Z
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ssrasrr-new 1EEIil1UIFT=IR .27,
This item requests that information be obtained
relative to the sub-chartering of the vessel CAMAS MEADOWS
to a French firm by the name of Groupement d'Achat Carburants
and to whom this_compeny paid such sub-charter hire.
The following investigation was conducted bySM xn...!
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French Oil ndustry Agency, ;O Broadway, New lork City, l
advised that the firm Groupemcnt d'Achat Carburants of
Paris had been given a monopoly on all imports of oil into
France by the French Government. This monopoly was dissovled
in April or May of 1950, and the firm Groupomcnt d'Achat »
Carburants is in the process of liquidation. The records of
this firm, however, are still in the possession of the French
Oil Industry Agency. _ '1
V The French oil Industry Agency at the present
time consists of a group of individuals who have been
delegated powers of attorney by the majority of French oil
importers for the purpose of handling and the transfer
of funds in the United States. The agency does not hold
any charters for any vessels.
Photostatic copies of the voyage charter. dated
February 12, 19b8, between USPC and Groupement and related
papers were made available and are being submitted with
this report as Enclosure Number 7. This voyage charter
reflects that the tanker CLHAS PTADCUS was to be used to
fulfill the charter; however, the owner hold an option to
substitute any other similar United States flag vessel.
The period of the charter was that
rmnain in force for as many consecutive voyages
could perform over a fourteen-month period,commencing
from the date the vessel was presented for leading for itsit was to
as the owner-u-vi: lu92l - v§|:nr4-pff"P~l|uo§fIu1|u-~'q:'¢-l¢;|In'-"*- _ D . 1, ___r Pr
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The freight rate as amended was to be in '
accordance with United States Maritime Commission Bate
Order L38, plus 165% for the first two voyages and plus -
- 160% for all other voyages.
A letter dated Hay 17, 19u8, from USPC toof Bryant and Vining Company, Inc., Agents
of U , c lects that the United States Maritime Commission __
on April 22, l9hB, had approved a ten-year time charter
of the CAMAS MEADOWS to Petcep and that the CAMAS MEADOWS
voyage charters would be-performed by Petcap, the chartering
owner. This letter also indicated that Lambert Brothers, Ltd.,
London, England, were the general agents of Petcap. -
_ A schedule of the payment of charter hire and 1
demurrage is as follows:
Note: Payment on Voyage #1 was made to
the National City Bank under-assignment
made by USPC. All other payments to
National city Bank were under assignment _
made by Petcap and all other payments
were made to Petcap direct, with the
exception of Voyage #7 which was paid
t La b t0 m er Bros,, Ltd. as agents of
Peteap and Veyare =8 which was paid to
Petcap c/o' £7aJ
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NY 00-2567
Voyage
Number
1
1
2
2
2
3
3 -
H
h
5
6
7
8
9 0
10 __Date of
Payment
u/20/us
5/M/AB
7/19/MB
10/EB/h
11/h/MB
8/9/n8
8/31/08
10/0/is
1/7/M9
11/3/h8
1/10/noFreight or
Demurrage
Freight
Freight
Freight
Demurrage
Demurrage
Freight
Freight
Freight_ ,i .iii__iiii
i~!
Peid'To
National
Bank
National
Bank _
National
Bank
Peteap"
Petca
National
Bank
National
BankCity
City
City
City
City-$Amount
Shh,hBS-70
21,1Ok.O9
016,569.00
33,520.00
851952.00
3?h,978.92
16,392.50
378,817.97
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*inIormed that the tanker CAMASMEADOWS-was not rec er cred at the completion of the charter
dated February 1, l9h8; however, he related that on December
1, 19h8, the S0conyVacuum Oil Company and Compagnie
Francaisse De Raffinege entered into a voyage charter for
four consecutive voyages, which was later amended to-eight
additional voyages. No particular ship was identified to
perform the voyages butsocony was to supply one ship per _
month between the'first and 15th day of the month, beginning
with January, 19h!, but the vessel was to be nomineteci fourr
weeks prior to loading.
dViBGd that Addendum Number 16
reflects t st the vesse C. J*L'92S 1'-I1?-AD01-IS was substituted for '
the vessel H.E.'RMAN F. WHITON. Payment of the charter hircs on the
vessel were made to Socony-Vecuwn Oil Company. _
_ IQ; following investigation was conducted by
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NY Q6-2537 .
P13§3.TTI5=lNT TTEH NUMBEFLZBv
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E
This item is in reference to the details of the
agreements with Socony Vacuu Oil Company for the substitution
of the FT, BHIDGER and the LAKE GEORGE on time charters.of " '
foreign flag vessels. The identity of the foreign flag » 5
vessels which were originally chartered to Socony Vacuum a
and the charters_invo1ving these arrangements were to be 2
emf Pm-r92'|"1'92D92Jy nL§|§ ll.
Details concerning the substitution of the FT.
BRIDGER for the ARISTOPHANES owned by Sociedad Maritima
Miraflores is contained in Department Item Number 16 and
Department Item Number 2k.
I ' Information pertaining to
substitution for the OLYMPIC TORCH,
Cil .Lines of Panama, is contained
Number 16 and as follows:the LAKE GEORGE as a '
owned by the Olympic
1' n T92nnn1~+mn'n+. T+.n1-nLIL QJIIIII ii U .92§CQY L YYIII
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Marine ranspor lVlSl0 K * Varuum Oi Company, 26 57;." Broadway, advised SA A that the OLYMPIC -
' GAMES owned by the Olymp c il " lHQS- s chartered to Socony
on a five year time charter ~ basis. Subsequently Mr. PRATT 3
and Mr. ONASSIS made an agreement whereby the OLYMPIC TORCH i
would be substituted for the OLYMPIC GAMES. This was satis= '
Factory to Socony as the OLYMPIC TORCH was of equivalent "
- tonnage but a faster ship and, therefore, Socony stood to.
make a substantial saving on the substitution. The OLYMPIC
GAMES went off charter on July 26, 1950 and the OLYMPIC TORCH .
___ was delivered on August 12, l9h9,
The reason for the ONASSIS substitution was that
ONASSIS wanted to make a whaler out of the T-E tanker,
SS HERMAN F. HHITCN, and to transfer it to a foreign flag,
As it was necessary to got the approval of the United States
Maritime Commission, ONASSIS was prepared to tender the
OLYMPIC GAMES, a foreign flag vessel, for United States I
registry in exchange for the WHITON'S release from United
States registry,
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In July, 1951 Mr. PRATT and Mr. ONASSIS made
another agreement whereby Socony would receive two T-2 tankers
as a substitution for the OLYMPIC TORCH. It was necessary
that ONASSIS obtain the OLYMPIC TORCH, a foreign flag vessel,
to fulfil an agreement he had made
Oil COMPEDYQ Socony was satisfied
as it added greater flexibility to
market for a 28,000 ton vessel was
not benefit from a rate standpointwith the Anglo-Saxon
with the substitution
their fleet and as the
very poor. Socony did
on this substitution-
As previously reported the OLYMPIC TORCH time charter
was canceled and the vessel was re-delivered on August 3, 1951.
The T2 tankers, LlKE GEORGE and WILLIAM A. H. BURDEN, were
the substituted vessels.
The charters and related papers of the vessels-
chartered by Soeony from the ONASSIS-KONIiLIDIS group are
being incorporated as Enclosure number 0.
[EPART NT ITBM_ amass 29 ...' ~< ; ihéiii s :N"' _iL C C . .
-_,_.'
¢This item renuests the identity of the individuals '"'f '
that negotiated the sale by USPC on May 10, l9hB of its stock-
in Petroleum Carriers of Pa1ama to Miraflores for %2,600.00
and the purpose of this sale. '
Information regarding the above question is set '
forth in detail in the last section of this report that
f8pOrtS the INTBRVILH OF ROBLRT L. BbRLN5DH¢~
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PEPARTMNT ITEM NUMBER }0 _
5 This item requests information regarding the inception,
background and operation of the collateral loan account of USPS ;
_at National City Bank. _ N - 6 --
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As a result of this position taken by National Cit Bank, 6II
§ the Department Questions Nos. 5, 17, 19, 20, 52, 62, 63 and 6 , as4: to when neqotiations began and who participated in them concerning' Bank, cannot be
ascertained. Fowover, the facts pertaining to who participated in
these negotiations and when they occurred are contained in the
interview of ROBERT L. BEREFSON set forth at the end of this report.
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In this respect, it is noted that Exhibit
U. S. Maritime Commission report dated May 2h, 1951,
from ROBERT L. BEREHSON, President, USPC, to ARIONA,
19h8, indicates that ARIONA will furnish to USPC the' . * Q @-
21 of the
a letter '
dated June 22,
funds neces~
sary to make payments on the mortgages of the FORT BRIDGER, LAKE
GTORGE and CA?AS HEADOWS- g
Exhibit 23 of this same Maritime report, a letter from
R. L. BERENSON, President, usrc, to ARIONA, dated August 16, 19u8,
states as follows--I
"We have new made arrangements with the National City
Bank of New York and it will not be necessary for you, in the
future, to place us in
collateral to guarantee our loans.funds, but only to furnish the bank with
' -"We shall, accordingly, as of the next due date,
August 26, 19b8, discontinue the arran¢ements set down in our
letter of Juno 22. In the future, will you kindly arrange the
guarantee of our loan at the National City Bank of New York by
placing collateral with them as amounts fall due under ou mortgage
loans in accordance with the schedule of due dates which we have
sent you. ' - -
"Will you please confirm your arrangement with the
above procedure and also confirm that the collateral which you
will deposit with the National City Bank of New York will be left
with them to cover any renewals of the loans from the bank which
we may require for a period up to ten 0! years."
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_NtiOnQl Grai loan Arrangement to uepny§Qnk" it J . w-. .
The cash disbursomonts vouchcr on cncr ed errecords of USPC, wh chhwczilelixalilined by sién Bro Af1 t th t~¥& C do t e ow n a mcn s o ona an one%h1s goliagorgi ioan acgount: B P y g?!
' §heck No. or Othorethodrpf Paymeng * Date Amount
$5,550,000
' 250,0009-12-51
5:2-51
u-16-51
5-23-503795 -
3359
3299 -'Check No.
Check No.
1,200,000 Check No.
Paid by transferring same to secured 100,000"
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Date" Amount Check No. or 0ther_Meth9d of Paymenti|-1¢-_--u--n-
USPC letter to National City Bank,
February 28, 1950. Debit memorandum was
dated March 1, 1950. This was paid in
connection with writing of a new note
reducing the collateral loans from
$0,500,000 to $h.hoo,o00. .
Check No. l66h 12-15-us it 005,000
s-31-00 1,500,000 Paid by transferring same to mortgage
loan account and issuance mortgage loan
dated March B, l9h9 in the amount of '
£11 Cf nn 92_r'|n-irvla 14-92nn 1.1-no nnili u92J92I92l, IIILJ-92Il'.L J-92Jlw92-IA UUI-LI II!-4-J-5 l-Q92I
follows: .
Date Amount
$ 53
166,
53» 9
. as 0 . l,oa.., %-: 9 9 all or - c rung,
._l._ "J_I_'_,-A% 3I,,,,..3_3_3.- - F115 .".;2i¬;.'-i;.;.';-
- 530333.33 _ -
333.333-36
The balance in USPG's regular checking account at the
National City Bank on September 12, 1951, according to the cash
receipts and disbursement records of USPC, was $39,392.23. These
records reflect that the only other rcccipt'of September 12, 1951
was $1c,c22,222.22, which was received from Metropolitan Life In=
surance Company, of which ton million dollars represented the pro
coeds of a bond issue sold by USPC to the Fotropolitan Life In-
surancc Company under Preferred Ship Mortgage and Indcnture dateden
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- ~ ~ The balance in USPC's regular checking account at_the
National City Bank on May 1, 1951, according'to the records of H
USPC, was $82,923.h6, and on May 1-2, 1951, there was a receipt of
$378,296, of which $377,955.58 represented proceeds from the 5519
of Pacific Tankers, Inc. capital stock by USPC to Victory Carriers,
- Inc. on July 19, 1950. These records reflect regular disbursements
on May 1-2, 1951 of $77,691. Tho records reflect that a payment Y
was made on May 2, 1951 to the National City Bank by USPC Check
Ne. 3359 in the amount of $250,000, drawn on the regular account.
It therefore follows that the source of the funds for the major
portion of this payment was the proceeds of the sale of Pacific
Tankers capital stock to Victory Carriers, Inc. on July 19, 1950,
It is noted that this account was carried in the Accounts Receivable
of USPC until May 2, 1951. _
checking account at the
$233,612.15, according to
in this account onThe balance in USPC's regular
National City Bank on April 15, 1951 was
the records of USPC. The total receipts
April 16, 1951 was $1,200,000, which was received from Pacific
Tankers, Inc. and represents s loan to USPC which was carried by
that concern as an Account Payable of Pacific Tankers, Inc. These
records reflect that the only disbursement from this account on
April 16, 1951 was USPO's Check No. 3299 in_the amount of $1,200,000
paid to National City-Bank in partial retirement of the collateral
-- loan account. It therefore follows that the source of the major
portion of these funds was a loan on "open" account from Pacific
Tankers, Inc. -
The source of the funds of the Ma 23 1950 pa ant onthe National City Bank collateral loan in the amount of ¥T00{000come from funds of the company's normal operation and was pa d asEugigusiy set out by dobi memorandum to their regular account at
B. Brio -
The balance in USPCs regular chockins account at the 6
.H__Nationa1 City Bank on December 1, l9h9 was $7,156.85, and there
was subsequent receipts of $1h3,085.06 and disbursements of '
$109,006.22 between December 1 and December 15, 19h9, in addition -
to the following: _
Large Deposits and Disbursements _
Deposit December 7 19h9 received from Pacific Tankers Inc I$1,822,BO0, representing proceeds of a lean to éacifie
_ __ Tankers, Inc. dated hugust 12, 19h9, in amount of .$1,800,000 and accrued interest thereon of $22,600!._
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December T, 19b9, paid to Pacific Tankers, Inc. by
Chock Ne. 1578, $1,800,000 representing a mortgage
loan to Pacific Tankers, Inc. dated December 7, '
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December 7, l9h9, received from Marina Trading, Inc.,
$5,200,000 representing proceeds of a mortgage loan
given by USPC to Marine Trading, Inc. on December 7,
l9h9, which funds were received by Marine Trading,
Inc. from Metropolitan Life Insurance Company as
proceeds of a Merino Trading, Inc. bond issue sold
to Metropolitan on the same date!.Disbursement.
Deposit
December 7, 1on9, paid to the National City Bank of
New York by Check No. 157?, $h,579,679.36 represent-
ing payments on mortgage notes dated as follows:
5-27-H9 $3.235.937-50
3-5-H9 333.333-36
8"'12-I-.9Disbursements
of which $9,h08.50 was charged against accrued
interest account!. - '
December 15, lqhg, paid National City Bank by Check
NO. 166k, $hB5,000.
The balance in the account as of the close of-business December 15,
l9h9 was $l98,h56¢33. It therefore follows that the major source
of the funds of the December 15, l9H9 Payment on the National City
Bank collateral loan in the amount of }hU5,000 was the Marine Trad-
ing, Inc. mortgage loan dated December 7, l9h9. _
- The only other payment to the National City Bank on the
collateral loan was Nay 31, l9h9 in the amount of $1,500,000,-whichwas paid,as greviously set out,by the issuance of a mortgage loan
dated March , 19h9 in the amount of $1,500,000. The payment of _
this mortga o loan was from normal business operations except thepayment of $833,333.36 on December 7, 19b9, which was paid as set
out in the December l9h9 schedule above. It therefore follows that
the major source of the funds to repay this $833,333.36 to National
City Bank was also the Marine Trading, Inc. mortgage loan dated -
-December ?3 IQM9. set out in that schedule. 'If .
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owing investigation was conducted by SA A! -_ M
The operating results of US?C for the years lqko '
tlirough 1951, as reflected from the company books and records,
were analyzed to determine the profits made by USPC from the 1
operation of the~vesse1s CAMAS MEADOWS, FORT BRIDGER, LAKE
GEORGE and ARICKAHEEQ -
From this analysis, the results of the operation of
USPC are summarized as follows: .
Profit or L
Federal I
19hB" l9h9
1950' n_qqn+1_ LPup»; =1 ULUH Lu
CAMAS MEADOWS
FORT BRIDGER
Total LAKE GEORGE
Operations and ARICKAREEf92-en-gal-I 41.0-92 AlUIJG-1 tll-vJ.Ull
srouy POINT
camp NAMANU
and O Other
BATTLEQROCK Activities
oss before '
ncomo Tax .
t 7,e5u.oh! $ 182.05|1
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In addition, Sociedad Maritime Miraflores Ltd. entered_
into a guaranty with USPC that, under the three time charters, 92
the net of charter hire and vessel operation expenses would be at
least equivdkntto the revenue that would accrue to USPC under
bnreboat charters at the rate of $1.00 per dead weight ton per
month.
In each year Sociedad Maritime Miraflores was required
to remit to USFC~under the guaranty relative to each of the three
time charters. Since the ARlCK..HlE.E bareboat charter was at the rate
of $1.00 to Petroleum Carrier of Panama, the operation of all 92
four vessels over the four years was in effect at a monthly
rate of $1.00 per dead weight ton. '
The operation of the vessels STONY POINT, CAMP NAMANU
- and BATTLE ROCK was under barobost charters to ue Socony-Vacuum
Oil Company. The results of operation shown in the foregoing
,schedule are for the period from March 3, 19h9. the date of ;_
merger of the American Marine Corporation and the USPC, to
. December 31, 19Sl.
Operations of the three tankers-by American Marine
Corporation during 19hB and until March 3, 19h9 resulted in a
~'~~=@ses;seer1e~sr*e225???e¥73%*sieh=ees the adjusted emeritus -5o"*
Marine Corporation earned surplus credited to USPC's surplus
account upon merger. Over the full four years, then, these
three tankers were operated at a not profit, before taxes, of I
$1,96h,36?.l5, while the four original USPC tankers chartered
to Petroleum Carriers of ?enama were operating at a net profit, _
before taxes, of $221,211.90.
In the schedule sot forth previously and in Exhibit E
- attached to this report, items classified under "Other Activities"
consisted primarily of interest expense, interest income and
amortization appliceble to investments in and loans to affiliate
cQmpn163 by USPC, In addition, expenses relative to the Coast
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and depreciation could be ascertained by vessel from-USPC's books. .
BECKER advised that USPC's financing consisted of a series of
loans, some of which were retired from the proceeds of subsequent
loans. Ha stated that the installments on the original mortgage
loans of USPC's initial four tankers were retired threugh
subsequent borrowing. - I
BECKER maintained that it would be an extensive
project to attempt to determine the exact interest expense
applicable to th: purchase of each of USPC*s seven tankers.
BECKER also stated that the extensive investments in and
advances to affiliates by USPC were accomplished through
borrowing funds.
It was suggested to Mr. BECKER that the interest
expense applicable to advances to and investments in affiliates
by USPC during l9h3 through 1951 be computed at h%, the rate
' under mortgage loans by USPC, and that the remaining interest
expense be considered applieahl" *
seven tankers.4the operation of US?C!s
.
- BECKER agreed that this method would present a fair
- ..allocation of interest expense. The foregoing meaod of
allocating interest expense was therefore used. Interest
relative to the tankers was divided equally. Interest income
from affiliates was applied against the interest expense
computed as pertaining to affiliate financing.
In reference to general overhead; that is, administra-
tive and general expense and other miscellaneous expenses and
income, BECKER expressed the opinion that a relatively small
amount of such expenses were applicable to bareboat operation.
He stated that little expense is incurred bv the owner under
bareboat charters, cs the chartercr has full responsibility for
operating the beat and paying expenses.
BECKER suggested that a fixed overhead expense alloca-
tion of $15,000.00 per bereboat charter per year would be a fair
distribution of such expenses. In computing the operating
results above such an allocation was made to the four bareboated
tankers and the remaining administrative and general expense _
5 __4 _ __ _1_-- -_x- _ i _._-.- _ e __ _unueuthr mlauwlluuuuuu oxpuuuuu and luma HGFG 11OCt6¢ $6
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three time charter vessels. Miscellaneous amortization, hhioh
consists of amortization of mortgage expenses and the excess
cost of stock of affiliated companies over book value, was
t d directl to each of the three categories of operation alloca e ' y ~i -
where such was asccrtainablo. The balance of amortization of
f i terest mortgage expenses was allocated in the ratio o nexpense. " V ENY
The portion of this Departmental item relative to .
dividends has been discussed under Departmental item 12,
1.
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This item is in reference to the existence of the
Socony Vacuum Oil Comoany and Grsupcment D'Achat des Carburantes
of Paris charters and_the present employment of the vessels.
It also deals with the commitment of the charter hire revenues
to bank loans until the receipt of the charter hire as it
becomes due byUSPC. ' t c- "
French Oil Industry Agency, B7,
SO Broad tree , a vised SA 1 that the
firm Groupement D'Achat dos Carburan es 0 aria, which is
in the process of liquidation, does not have a charter on
any vessels. _ '
h <9Marine Transport Dlvisic S'coP* e il Company, 6 gt,
Broadway, advised SA {A that the following
vessels are on charter to sucony and the charter hire is
assigned to the banks as listed:
VESSELS ' BANKS
ARICKAREE Chase National Bank
FT. BRIDGER - National City Bank
L;HE GEORGE National City Bank
CAMP NAMANU Chase National Bank
BATTLE ROCK Chase National Bank '
STORY POINT Chase National Bank
WILLIAM 5. M. BURDEN National City Bank
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DEPA_R1M ET IT QYLNUMBER 22
This item requests information as to the law firm
that incorporated American Marine Corporation on October 17, R
I ' ' I
owing investi atio as conducted by SAM! _ _and ski 92e,,,
, ROS win, Rosonbaumani
Meecham, Washington, D. 0., and SUEL C. .ARNOLD, of the firm
of Doughcrty, .'92rn0'ld and Waters, Milwaukee, Wisconsin, "and s *.,;"f . LY- 1 F: ;;._.*:;:-__'= _".-e-: ' ~;+_l-:1; ' .21.. 1' _>* : ; ' ., 1 ' *1:-_"t 7..-1-,-.=-.*";-'_:;,~';*-.1.1:55 "5-:=,=_:z.-;":.=..-:_"_:1i=,;?..=¢.==;;=-:-F-E;z::=?§=;a
* the original stockholders were him- b-!9
self, ARNOLD, P.. ER, and one other individual of 1-hose
identity he was not certain. To the best of his
there were a total of four stockholders each hol
shares of no par value stock, for which a total of
was paidin company. He stated PARKER re
of this anounlz, representing---- qj shr-r took to be issued in PARKER's and92P shares of stock to d in the name
advised that this was furnished
form of n check of 0. or and Company,
at the timefor
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100 shares of American Marine stock remained in his name .
until sometime in February, 1914.6 when the s I American __Marine was sold to U. S. Petroleum Carriers '
he had nothing to do with arranging the sale of e s oc
USPC and first learned of the transaction when PARKER told ,
him they worewgl sell the company." In this connec-
tion PARKER end DUDLEY handled the sale t.
ts * of th for the sale had been
made prior to the time he1
knew anything about it. _.
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charter these vessels on a bareboat basis to one oz-more
of the first group oil companies and pay off the mortgagen the vessels with charter hire over a five year period, ¥:LQ "' was to be the accountant and PARKER was _ C
to handle certain legal matters and, although he did not -
know it at this time, DUDLEY was supposed to be an expert
on organization of foreign corporations.. _ " » '
returned to New York City and
discussed r with the ers of 0
92 ":1
he does no
, lieves he must hav
. him of their appro
the matter at the meethe ha that,agree es accountants for Americanarine, would
do so on a contingent fee basis with the understanding that,
in the event the business venture proved unsuccessful, 0, F,
Taylor would not render a bill tohmerican Marine and, in the
event the venture proved successful, O. F.Taylor and Company
would bill American Marine at approximately twice the fee
which they charged regular clients for comarable services,,he be
advised 7
was made Secretary-Treasurer of i l io7
Z1
such arrangement made it possible for P¢'aRKER te use
the office of 0. F. Taylor and Company fnam which to make
t 1e ho alls d h. dl mi ll tt whil in ' »
.__..Lthe corporation n t was convenient to have a representa-
tive and official located in New York City an urthcr in that
e p ne c an an e see ancous ma ers e
New York City -
I-Te advis--d P1PKEH2, made I-. number of visits ' 57;-
and he had discussions with them on many occasions, separately
and together, in New York City between October, 19h? andFebruary, l9hB relative to chartering the vessels and finan- Likp' cin the purchase of the vessels. In this connection,_ _
it was almost imperative that the agreement to charter -
e vessels and the agreement to finance the vessels take
place simultaneously as the company or syndicate which '
financed the ships was reluctant to do so unless the identity _oi
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NY -he-2507 _
. Ho advised it appeared for some time prior to
February, 19hB that the New York Life Insuren ee Company
would finance the purchase of the three vessels allotted i 92
to nmerican Marine Corporation by the U. S. Maritime '
Commission. He advised, however, that negotiations with
New York Life Insurance Company did not materialize end he
did not think 0. F. Taylor end Company would receive any
fee whatsoever; in fact, he said the company was considering
writing off certain d bursements to profit and loss wheneither PARKER o informed him that they had found 92 - L10
someone who cou o ain a charterer for the vessels.
He advised it was about this time the stock of
American Marine was sold to U. S. Retrelgum Carriers and
exhibited a letter dated February 5, lqas addressed to
American Marine Corporation, 1025 Connecticut rvenue u.w.,
Washington, D. 0., in which he submitted his resignation as
Director and Secretary-Treasurer effective when accepted by
th ti n It is to be noted that the address of the e corpora o .
American Marine Corporation on this letter the Same s
that of the office of E. COUHTLAND PARKER.- does not recall when he severed__ all connec ens w th e
company but that after February S, 19148 his only connection
"with American Fiarine was to sign papers as Secretary-Treasurer
of the company. _
_'1ttending a meeting in Hoboken, New
Jersey attended by offic als of both American Marine Corpora-
tion and U. S. Petroleum Carriers, at which meeting he signed
a number of papers as Secretary-Treasurer of American Marine.
He said he could not recall if it was at this meeting that
the sale of stock took ple ce or if the meeting was held for
some other f»li.ITp6E6- A
that he and the other partners of _
0. F. Taylor and Company were pleasantly surprised upon
learning arrangements had been made to sell the company and
that they would receive a fee for accounting services rendered
American Marine because he had given up hope of obtaining any
remuneration after the New York Life Insurance Company _ '
financing failed to materialize. He advised that at regular
rates he figured he had performed services amounting to '
appmxfmately F-14., 000.00 for American Marine and, on this
this basis, 0. F. Taylor and Company received approximately . .
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$8,000.00 twice the regular fee!, which money was received f
from ROSH~IBr.UI-1 in installments over a period of about five
- years, the last payment in the approximate amount of $1,200.00
being made very recently.
that he personally received 25% ofthe receeds ta no n cennecti this matter. -these proceeds were
pa e m persona y y 1 M's irm in the form of
cheeks, which checks were turned over to 0. F. Taylor and "
Company and deposited in a bank account, the proceeds being
subsequently divided equally among the ibur partners,
t in connection with the last
' payment that he rece ve from ROSENBAUM, there was aenclosed a release which was drawn up by HOS ENB.-'".UM. lb
did not like the wording of this release inasmuch as t
appeared to him that he was affording to ROSENBAUM complete _ -
protection against any legal action in connection with Ameri-
can Marine Co ated tin t he, accordingly, got
in ton forwarded -to him a c of ah119_.s.iv¢n. to. R@SE1~'Br~UM- EMs mpIe'r-elease and he hada-copy " "-
for himself which he signed and transmitted to
SENBnUM together with the unsigned release which ROSENBAUM
had forwarded to him with the final payment. He added that,
while he had never met ROSENBAUM in New York City, he had
had many discussions with him in Washington, D. C. in -
connection with matters pertaining to the American Marine
Corporation.
- - _<>. P- Taylor md comwmw was
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This item requests that it be determined whet bank _
' has been contacted by officials of American Marine Corporation
to finance the purchase of vessels. ' o '
The following investigation was conducted by SA A! 9257o>
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SA that he did not knozw of any banks, insurance
companies, etc., which had been contacted prior to the date of
incorporation by officials of American Marine Corporation to
finance the purchase of the vessels. He added that subsequent
to the date of incorporation, the only negotiations of which he
had knowledge were with the New York Life Insurance Company, as
set forth under Department Item Number 33. _ ' _
e DEPf92B,I,b*IEIiT ITEMHNUMBEB 35 _ _ .L?
ha.
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ts that it be determined if Messrs. I
had any previous shipping experience. LJC. PARKER,
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PEPARTMEINT ITEM mmera 31
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This item requests the names of the individuals who
participated in the negotiations leading up to the sale of all
the stock of American Marine Corporation to USPC on February 3,*
l9hB. It also requested it be determined if ONASSIS played any
part in these negotiations.
that to tge L25! s !now!e!ge, PARKER and
D BY handled the sale of American
but is not familiar with any of the
leading up to the sale. He pointed
this re er s hearsay and what he
and , was not presentMarine stock to the USPC
details of the negotiations
out that his knowledge in
knew was told him by PARKER
at any of the negotiations.
_that he had never met an individual
by the name of ONASSIS and, therefore, would not know if ONASSIS
played any part in the negotiations
'--.;:=21"'-7:. '.';:»r ;:. -**.@-:;- 1;: ¢_- ,.1?t=:-¢=_=_-_-_":;_i_- ""- _-t --. .~.-_Lr;.~ -' =leading up to this sale. ,
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NY as-250? 'i ' '
PpIEPnRTMENTr;TnMWNUMB5R_3B
The following investigation was conducted by SAA 'h1¢_,
rn - ......_ .......... . "this ituum Fwunxsat-S that it 103 3-30$P6¬n"t I185;
is any relationship between the agreed amount set forth in
nxhibit 29 of US maritime Commission report dated May 2h, 1951
and the 350,000. advanced on February 3, 19h8 by ARIONA through ,
SSY. e . _
In accordance with the terms of the agreement
3&1 600. was paid to GOODHFF, ROSENBAWM and MEACHAM duringl9hé as set forth below:
-Amount
11,600.00Date
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5mr 1,6-2507 . '
DEPARTI-E1-IT ITEI_-1 nu:-men _39
This item requests that it be ascertained whonegotiated with the Chase National Bank for the financingof the three tankers BATTLE ROCK, CAMP NAHANU, and STORY _POIIIT! allocated to Aracrican Marine Corporation, and whatwere the negotiations leading up to the loan agreement ofMarch 23, 19l|.B, in the amount of $14,320,000. v _, 4
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92; |'W!!l|l' ; _ L71,-
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mz use-2507 _ '
DEPABfI'%sNT ITEM 1+0
This item requests that it be ascertained why
the Chase National Bank required OHASSIS to guarantee the f_
loan of $h,320,000, as mentioned in Department Item Nuber 4
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k7,,92
DE?ABIIIE}I_'§ I'IlEI-1 NUIFDEI. 1+1 é
This item requests that it be ascertained who
participated in the negotiations leading up to the ra- '
financing of the vessels BATTLE ROCK, CAMP NAMANU, and
STONY POINT through the Metropolitan Life Insurance Company..
ted 4
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M-92by SAA
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ptrssrnsur ITEQLQUMBER a2 ' - H 5
n unq nnnr'l92'|r92+_:92 :| h _Q I. W Q I H _ ¬ u¬ U 7
C-
In regard to what portion of the funds secured under '
the refinancing of the American Marine Corporation tankers
BnTTLE ROCK, CAM? NAMANU, and STUNY ?0TNT, was used by USPC
to retire the debt to ARIONA, the following facts have been
developed from the books and records of USPC and American 5 =
Marine Corporation: ' -
On Januar_ 19, l9h9, American Marine Corporationused approximately £300,000 of the funds secured under the
refinancing as a partial payment to ARIONA and also paid
USPC approximately $375,000 on January 7, l9h9, from these
- 11111050 - - .
It is noted that the foregoing figures are shown
as approximate amounts because American Marine Corporation
had on deposit $138,1?u.99 in the bank account when the
American Marine Corporation bond receipts were recorded at
the time of the sale. , ' 4 .
-- The records of USPC reflects that they had a balance
in their National City Bank regular account on January 6, 7
19a9, of $552,951.67 and paid ARIONA $690,793.81 on JanuaryI:-
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NY he--2597 .
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NUMBER_gl . _ _
itcm deals with the date negotiations commenced
who participated for the bareboat charters _
PDIHI, the 55 GiMP N&MANU and the SS BATTLE '
Vacuum Oil Company for five years. It is also --
in reference to the part that ONASSIS took regarding these -
negotiations._ - l "ADEP92RTMENT ITEM
This
and the persons
of the 55 SIQHZ
ROCK to Socony
Marine
and Sn A
that J. Burbank and
Battery , p cipal business is dry cargo ship - ,_
operation, was introduced to him by one of the members of 5%!
the Board of Directors of Socony in early February, l9hB. '
During that meeting and subsequent meetings a general dis-
/ cussion was had concerning the chartering of vessels of the.-
tanker type. , _
qbout the middleof February, 3.9148, P advisedthat he was.acquiring three tankers whic would be Liz!
available for charter to Socony and,after some discussion,
h- t orally agreed to bareboat charter t
$2 O5 aer do monthadvi
a rate of
then called
Transport Division,
ffer subject to __bike
I DOC an 1 vie d him
his ability to obtain the vossc s,
this oral agreement must
, 19MB as the first correspon- have b ruary
151.9
lo7Q;een ma e a u
dencc in the file concerning the §S BATTLE ROCK and the SS$3M? NiMiU boars instant date. Correspondence tending to con-irm this period is being enclosed as Enclosure number 9.
* t " 92 an ' "NSON oi week later Mr. ONnSSTS
came to sc< and advised him
purchase the vessels providing Socony would
oral agreement of H at charters at $2.05,
then called him and advised him ofd Mr. BEBL
were
On.
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nit he-2507
res informed to acce t the offer ' esub e e rceogni ion of ; however,was then able to o a n a c er er rate of. from N..SST.S as an agreement had been reached with 573 him the prior week to bareboat charter the ARICKAREE at $2.00. '
This agreement was concluded the same day, .
does not I-mow whatagreements were ma.e etwoen and ONASSIS but he _
believes everything was done in a legal and ethical manner £1is a reputable individual and he has hear oth 9 3' as lluul| = to 1_923 contr erning Mr. omssxs. Furthermore L76?_stated:a rocorznized as the broker in e ,_ matter, and he believed h received a fee from USPS.
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tated he was not certain ofwlexact pesit1|!n in these matters; however e d 1-7:.
su sequently heard through shipping circles that LQQ
had attempted to buy three vessels but was unable inance '
them although he had been willing to invest $800,000.00 of
his own money,
S with regard to the chartersginformed . S
that on March 23, l9h8 Socony bareboat c artere the vessels
SS STONY POINT, SS B.'l'ILE ROCK and the SS CAMP NAMANU from
the American Marine Corporation for a period of five years
each from date of delivery at a rate of $2.00 per dead
weight ton per month. The SS STONY POINT was delivered on
April 1h, IQQB. The SS CLMP HAMANU and the SS BATTLE ROCK
were delivered on March 29, 19hB. .
The charter hire on the SS CAMP NAMANU and the
SS BATTLE ROCK was assigned by the American Marine Corporation -
on March 23, 19MB to the Chase National Bank. The charter
hire on the SS STONY POINT was assiened by the American
Marine Corporation on April 1h, 19u5 to the Chase National
Bank, By nddcndum_#l dated March 3, l9h9 to the charters on "
- S. thq_ebov§_n§m§§ vessels, Sqceny agreed to_eee0p§my$P0"es M _Hr __iV_
'" Tcffirb"OWer§ dhb te theérgerof"Rm6r1eE'Mhrie"U6rpefafiOm£
with USPC, and also agreed to pay the charter hire to Chase
National Bank as assigned by USPC.
1-{Q .
_____ The followinn investization was conducted by SAIA! L7
1a.
-_ - A upDEPA?T"5 ?ilEEUrF?M¥ER
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NY us-2507
nsrmmwsww TTEM HUMBTE 45
This item deals with the negotiations with Socony
Vacuum O11 Company to substitute subcharters from PETCAP
irstead of dircct bereboqt charters from USPC It also
concerns the port ONXSSTS played in these negotiations.
Bfauwy, &uv_
ve no knowledge concerning
t the SS STONY POINT, SS GIMP
NLMLIU and the SS BhTTLu HOCn to PBTC1P They informed
that their records reflect that USPCIHD the chartered
owners of those vessels,Su bfthat they °
t of Uq
P PAR1H§hT ITEI NUMBER go
.vcs+i3etion wee conducted bv SAA
i c-
This itcn requests that it be ascertained who parti
cipated in the ncgoti Lions which resulted in the merger of
Amorlcan Harlné uaiporntiun and QSPC on mafia 3, 19L?
Iniornction concerning tnia item is set forth under
the INTERVIEW OF hGuIRT L. BEHnNSON
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QEPARIHEHT_II§M NUMBER_Q1
This item requests that the amount of charter -
hire paid by Petroleum Carriers of Panama to USPC be
ascertained.1
From an examination of the books and records of
USPC and,more particularly, the accounts set up thereon .
relating to Petroleum Carriers of Panama and Lambert Brothers,
Agents for Petroleum Carriers of Panama, it was ascertained
that the following amounts of charter hire were paid by
Petroleum Carriers of Panama to USPC during the years l9h8
through 1951: ' _ ' .,92
. 19h8 *1 7 63 :751on9 w2:12%:22%.85
1950 2,22l,8h6¢§6
1951 g,123,116.gg
P royal $6,25?.uBt-63 _ "i ~
. ..=. _ ....- __92.... -t _._ --. sin.
~ s-.{;'-.1 at-=-2;. ': .e.@_-.@r:.%e:spie-ee=de-taeils.hashesstoragei":sgea=re=-;is~B5-?¥iiB=*~=**"P*ii**~5=~%§£E'i52
submitted with this report as Exhibit F. This exhibit
consists of four sheets, one for each of the years 19hB, -
19h9, 1950 and 1951- '
It will be round that the charges for charter hire
as set up on the books and records appear on the left portion
of each of these pages and the payments or reimbursement for
charter hire as ascertained from the books and records are
set forth on the right portion of each of these four pages-
It will be noted that the total of the payments or
reimbursement for the years 19hB and l9h9 exceeds the amount
as set up as the charge for charter hire for those years-
This excess is accounted for by the fact that included inn
the payments are amounts for expenses in addition to the
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Further, in connection with the foregoing exhibit
it is to be noted that the payments are reflected in some
instances as coming from Barclay Bank, Ltd., Lambert Brothers,
and Sociedad Maritime Mareflores. The first two organizations ~
named act as agents for the Petroleum Garriers of Panama and .
the latter organization owns the controlling interest in
Petroleum Carrier of P e enema. The investi ation relative tothis item was C91|U.1.lCt6d by SA Mi
DEPARTMENT. ;r;:_M_Nug~geE§_ 46 Ab7c_»-
This item requests that it be aacerteined what law
firm incorporated Victory Carriers Inc. -
emote 0. BPXIKER advised san _ that he Wr-
thought Victory Carriers Incorporated was incorporated by_the
law firm of Goodwin, Roeenbaum and Meacham. However, informa-
tion eoneerning this matter will he eet forth under the INTER-
VIEW OF HOB ERT L. BERENSON.
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QEPARTNENT*ITEMWHUMBEHUQ2
This item relates to the stock of Victory Carriers,
Incorporated, and also tho business transacted by_this company
from December ll, 19h8, to February 26, 19h9¢
fo11owing.investigetion was conducted b? ea '!
k From an examination of the stock certificate boo
of Victory Carriers, Incorporated, it was ascertained that
certificate number 1 for two thousand shares was issued to
USPC on May 20, 19u9. This is the only stock certificate
that has been issued by Victory Carriers.
mp- _---_;_L IIU 1'5 UU.l'92-13Al III 492I-A-- l'l..--.-I;92-a- --92l'92'l-.4L LL-1! -_U-L VLUDIJJTJ UL1-l'I'.LU1'§ 1'51.-LUUU UIIHU IIU
. financial transactions were conducted during the period from
December ll, 1905, to February 26, l9h9; however, the minutes
of the company reflected that the Board of Directors<id hold
meetings during this period. 1
It is to be
of account of Victory
l9L|.9, at which tirne.a
_ Dani: in 1|-1-1:; nu-nnu-|-n+ hf--3;;-nan J-u Luau a.|I1vu.uv us.
i noted in this connection that the books
Carriers were not opened until May 2?,
deposit was made at the National City.
Vpav92vb45¢!l3n§--Mn n anv92-II-1:1 ml-A051;§fv!A+'vvv, I-§!tJ¢l-WD92.rllU¢LlJ5 ll btllb-L IIUUUIL .
contribution of $2,000 and a capital surplus contribution of
$852,000, such investment being made by USPC.
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D-EPART"E1YT_I1I3L1'1 NUTEER 5° ._._-.5-4..--.-_-i-._.a.-_s-.
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This item reouests that the cash position of
USPC as of February 26, l9h9, be ascortained..
__ The following investigation was conducted by
SA A A *=792
. Account
Account
Account
' ~ Account
Total
Q-From_an examination of the General Ledger, Cash
Receipts Journal and Cash Disbursements Journal of USPC A -
it was ascertained that as of February 26, 19h?
following cash balance was available:
N90
NO.
N90
NOQ1
7
9
15National City Bank of New York,
Regular Account
National City Bank of New York,
Special Account _
Chase National Bank, Trust
Account , -
Petty Cash
t'---1.05. 0- ..l_I__, tne "
Q 88,692.69
H1707-03
37,3h2.00
1:500:00
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pE§§RTMENT lIEM NUMBER $1
This item requests that the cash position of Victory
Carriers be ascertained-as of May 25, l9h9, which was the -
date of its contract with the United States Maritime Com-mission. H i-
The following investigation was conducted by SA A! 8
Q .3i 8 _ cg,
It was ascertained from the records of Victory .
Carriers that they had no cash position as of May 25, l9h9. A _
It was further noted that the general books of account were
' opened up as of May 27, l9h9, with a cash deposit of $85h,000
with the National City Bank of New York, such deposit was
credited to the account of USPC on the books of Victory
A Carriers. On the same date an entry was made charging the
account of USPC and crediting the capital stock account in the
amount of $2,000 and the surplus account in the amount of
$852,000. The explanation for this entry read as follows:
"Investment of US Petroleum Carriers, Capital Stock $2,000, .
Surplus $852,000." also on the same date of May 2?, l9h9.
the General Journal reflected a transfer of cash in the amount
of $852,000 to the account of SSY on the books of Victory- __~%
~Carriers. The explanation for this entry was to the effect
that it was for payment made by SbY for our account to United
States Maritime Commission.
' Also on the same date of May 27, l9h9, the General
Journal reflected an entry in the deposit account for United
States Maritime Commission was debited in the amount of $852,000
and the account of SSY was credited in an amount of $852,000.
The explanation for this entry appeared as an amount deposited
with United States Maritime Gommission to cover initial payment
of ten per cent on the purchase of eight victory-type AP3 vessels.
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_ NY #6-2507 -
DE?a5TnENT ITEM NUMBER_§§ _
i This item requests that it be ascertained who
participated in the negotiations with the National City r
Bank which resulted in the loan agreement of Hay 27, l9k9
for $2,800,000. .
he following investi a n w ucted by_ ~'M» i and $A<»Y L70
;,7; I
_ Further information in this respect is contained
- in the intrvie 9£_§03EBT L..BER§N§QH.se;h§ggth,st the, end 0;; _. of this report; "" ' - I _ " 0
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NY as-2501
DEFARTMENT ITEM NUMBER §3_ 0 -
r
_ W This item requeets that it be determined if the '
$2,800,000 loan was connected in any way with the cash and -
collateral loan accounts established by ONASSIS or his foreign _
corporations at the National City Bank for the benefit of
USPC . '
e followin inves was conducted by 8A A!,
Ha,
. Details concerning the Escrow arrangement handled by
Schroder Trust Company are sot out under Department ItemNuIT1bUr 65o I _r»-F
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NY K6-250? .
DEPnRT1"!ENT _I_';"EM__N1JMB_2;R it ' . _
This item requested that it be determined what
§; F; part of the security listed in the loan agreement of May
ti . 27, 19h9, was actually committed when the loan was made. ~'
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