BEAUHARNOIS PROJECT

Southland Times, Issue 21607, 20 January 1932, Page 5

BEAUHARNOIS PROJECT

BANKS WITHHOLD LOANS. AWAITING GOVERNMENT’S INTENTIONS. (United Press Assn.—By Telegraph—Copyright.) < (Rec. 7.45 p.m.) New York, January 18. ' The Montreal correspondent of the New York Herald-Tribune reports that the ' banks, which are interested to the extent ' of 12,000,000 dollars in the Beauhartiois ' Corporation, are withholding loans for the power company untjl the intention of the Government is known. The banks for a month have been doing the financing for the Beauharnois project on the basis of a tacit guaranty by the Government, but further guarantees are apparently not forthcoming. It is understood that a block of stock <■ represented in payment by the Beauharnois Company for an industrial company is to be returned to the Treasury. It has been j settled that Messrs McDougall, Henry and s Sweezey retire from the board, but the t membership of the new board is still tin- f decided. t A message published on July 25 last stated: An inquiry has been opened to investigate charges regarding the Beauharnois syndicate’s 75,000,000 dollar St. Lawrence power project, which was carried out under a concession that is alleged to be invalid, ( since it was authorized by the Governor-in-Council instead of by Parliament. It is L claimed that only the latter is competent \ to grant concessions involving the diver- c sion of water from a navigable river. It a has been established that the project was s not carried out in accordance with the i plans on which the concession was grant- a ed. For the syndicate the president admit- s ted that he sought to divert into the canal c the whole river flow instead of the 40,000 s cubic feet permitted. An inquiry is also be- i ing held into the charge that politicians fc improperly used their influence to procure the concession, being financially interested therein. It has been established that one senator who held an interest in the Beau- -. harnois syndicate before the concession was -* granted made cash profits of 300,000 dollars therefrom, and received over 1,000,000 dollars in Beauharnois shares after the concession was granted. A series of threats and allegations of “graft” developed, but it was hoped that “finis” was written to the scandal when the investigating committee’s fl chairman suddenly arose to-day and stated: “We Will hear no more argument by counsel. I do not think we can stand any a more.” c