Goldfine Accused Of Income Tax Evasion

Press, Volume XCVII, Issue 28629, 4 July 1958, Page 9

Goldfine Accused Of Income Tax Evasion

(Rec. 11 p.m.) NEW YORK, July 3. Mr Peter F. Mack (Democrat, Illinois) said today Mr Bernard Goldfine’s treatment of his gifts to President Eisenhower’s chief assistant, Mr Sherman Adams, amounted to income tax evasion by falsely listing gifts as business expenses.

But Mr Goldfine said the bills had had routine handling by his accountants. “If the Internal Revenue Service feels we made a mistake . . we will adjust our returns,” he said, the American Associated Press reported. Mr Goldfine. who gave his explanation in a statement last night,

will face questioning about that and other matters under oath today before a House of Representatives subcommittee. The subcommittee is investigating charges that Mr Adams helped Goldfine to get favoured treatment from Federal agencies investigating some aspects of his business operations. The subcommittee’s chairman, Mr Oren Harris (Democrat. Arkansas) said the questioning of Mr Goldfine would probably continue into next week.

Both Mr Adams and Mr Goldfine have said they exchanged gifts on a personal basis but both have denied that Mr Goldfine sought or received favoured treatment from the Government as a result. «

Mr Mack reported that the subcommittee, of which he is a member, had evidence to back up most of the other charges it has heard against Mr Goldfine, including that of an unnamed witness who might confirm that Mr Goldfine once said he bought a house in Washington for Mr Adams. That charge, which Mr Goldfine and Mr Adams have both denied, was one of a number made by Mr John Fox. a former associate and now a business enemy of Mr Goldfine. the American Associated Press said Mr Goldfine. a Russian-born poor boy who built a New England empire m textile mills and re ai estate, spent all of his first two and a half hours on the stand yesterday reading 22 pages of « 25-page statement defending himself and Mr Adams. In the statement he denied

various charges, explained his troubles with Federal agencies, and described Mr Fox as a man who “has told many lies about Bernard Goldfine and will tell many more, I am sure.”

It was after yesterday’s hearing that Mr Goldfine’s lawyer acknowledged that the industrialist’s gifts to Mr Adams had been deducted as business expenses for income tax purposes. Under the circumstances, such gifts would - be deductible only if the giver expected to get something of value in return, the American Associated Press said. Revenue Service officials indicated that a review of Mr Goldfine’s tax returns was under way. Mr Harris said another target of the committee’s questioning today would be three-quarters of a million dollars worth of cheques from Goldfine firms which were outstanding and uncashed, although some were dated back as far as 1941. The reason was still a mystery to the investigators. Mr Mack, in a separate interview, said Mr Goldfine would have to declare his tax returns were wrong or say 1 is gifts were intended to secure Government favour from Mr Adams which Mr Mack said. Goldfine did get. Mr Adams has said he made contact with the Securities Exchange Commission and the Federal Trade Commission on Goldfine cases but has denied they were “wire-pulling” for Mr Goldfine.

Mr Mack said: “The only way now Sherman Adams’ neck can be saved would be for Goldfine to take the rap for him and plead guilty to income tax evasion by falsely listing gifts as business expenses.” Mr Mack added that practically all the wide-ranging allegations made by John Fox in three days of sworn testimony are backed up by other information in the hands of the Congressional investigators.