PROFITEERS ROUTED

Otago Daily Times, Issue 24432, 18 October 1940, Page 12

PROFITEERS ROUTED

“CASHING IN” ON WAR EFFORT PRICES COMMISSIONER’S WIN (From' Our Own Correspondent) SYDNEY, Oct. 10. Wholesale profiteering in essential materials for the fighting services has been uncovered by the Commonwealth price-fixing authorities. Swift action has been taken against the profiteers, and they have been forced to disgorge excess profits, amounting in some cases to thousands of pounds Prosecutions will probably follow. The goods in which they have been profiteering are all classes of material required for Navy, Army, and Air Force uniforms: and the materials used in the manufacture of singlets, shirts, and underwear for the three services, in addition, profiteers have meddled in the supplies of timber, hessian, and materials used in tents. Those concerned were a number of former importers whose businesses had been virtually wiped out by import restrictions, “Action has been taken against these people,’ ! said Professor D. B. Copland, the Commonwealth Prices Commissioner. “They are dealers who established themselves as middlemen ,to handle those commodities which might be in short supply and needed fpr war purposes They sought to establish, themselves as secondary and redundant wholesalers, who were performing no useful purpose by helping to turn over some commodities at a profit. The prices regulations prevent this type of dealing, and whenever it has been found, we have taken prompt and drastic action as we shall continue to do.’’ The methods of the middlemen ’ were brazen, but simple.,- First-. - they engaged scouts to discover the immediate and pressing needs of the fighting services. With this information they approached manufacturers and bought if possible, the whole of their output, Wherever possible, they obtained discounts. because of the huge quantities purchased. When Government purchasing agents . went to the manufacturers they found that stocks had been cornered. When they went to the people who had cornered the stocks they found that the prices had skyrocketed. The element of the gambler’s risK figured largely in all these transactions, because the contracts entered into by the departments contained the saving clause that the purchase was made subject to the price oaid being not in excess of the legal maximum allowed The middlemen gambled on the chance that the department would not challenge the price charged and there are a number of cases on record where they got away with it—temporarily They reckoned without the ~ Price Commissioner's Department. which came down heavily on them and ordered them to refund profits in excess of the legal maximum. The Price Control regulations have proved too much for profiteers. They nave learned, many of them to their cost, that cashing in on the war efi’ori for their own excess profit does not pay- ’