se race--yes, one time in my life. Mr. Flanagan. Do you know anything about horses? Mr. Duke. Yes, I know a lot. I was in the 15th Field Artillery. I ought to know about horses. Mr. Flanagan. I notice in the letter you ask, ``How are the horses running?'' And you testified a few minutes ago that Sir Laurel Guy was a show horse. Mr. Duke. He is a show horse. Mr. Flanagan. What would a show horse be doing running? Mr. Duke. He has to run. They run him in a saddle, and then they run him behind a cart, or the show carts, and the entire prize is predicated on how the horse conducts himself wherever he is running. The Chairman. Who owned the show horses? Mr. Duke. Senator Morse owned Sir Laurel Guy at that time. The Chairman. At that time? Mr. Duke. Yes, at that time. And I think he just about purchased him about that time. The Chairman. Are you sure of that? Mr. Duke. I am not sure of that, but if my memory serves me right, it was about that time that he probably purchased the horse. Mr. Flanagan. You must have had some discussion with Morgan about Senator Morse's show horses. Mr. Duke. I probably did. Mr. Flanagan. Was Ed Morgan a friend of Senator Morse? Mr. Duke. Yes, he became a friend of Senator Morse. Mr. Flanagan. Did you introduce him to Senator Morse? Mr. Duke. I did. Mr. Flanagan. When? Mr. Duke. Again, I don't recall. A couple of years ago. Mr. Flanagan. Sometime in 1948, '49, possibly? Mr. Duke. I don't recall what specific year, or time. Mr. Flanagan. Under what circumstances did you introduce him to Senator Morse? Mr. Duke. Well, I might be mistaken in this, and I have got to be sure. I think that Senator Morse spoke before the FBI graduating class, and I think Mr. Morgan wanted to meet him at that time. Mr. Flanagan. At that time, was Morgan a bureau agent or a lawyer? Mr. Duke. No, he was a lawyer, but he still was very intimate about a lot of the members of the Federal Bureau of Investigation. The Chairman. I am curious about the ``talent'' you mention in the letter. You say you were going to round up ``talent'' and bring it to Washington. Mr. Duke. Again, I have to answer, I don't recall, at this time what I was referring to. The Chairman. Do you have any idea what it was? Mr. Duke. It could have been oil leases. There were a lot of them available in that area; and it could have been cases, and it could have been most anything, and I really don't recall what I was referring to. The Chairman. At least you were not referring to talent in the accepted sense of the word? Mr. Duke. No. The Chairman. You were using that as a code word? Mr. Duke. I mean my expression, and I expressed myself probably a lot of ways. The Chairman. Could you tell us why, in a letter of that kind, instead of saying ``talent'' if you mean oil leases, you would not say ``oil leases,'' and if you mean television cases you would not say ``television cases?'' Mr. Duke. I notice in that letter that I refer to television cases. Mr. Flanagan. And you also refer to oil matters. Mr. Duke. That is right. Mr. Flanagan. And you called it oil lands, and you didn't call it talent. Mr. Duke. As far as the Noble Wilcoxon case and the Schafer case are concerned, I am sure that those cases he already had, and I don't think I would have any reason to be referring in any code to him regarding those cases. The Chairman. Could I ask you this question: When you went out and solicited tax cases, where would you get your information about the case to begin with? Mr. Duke. Again, as I say, to the best of my knowledge, from various accounting firms, from attorneys on the West Coast, and I knew quite a number of attorneys. The Chairman. Sometimes attorneys would contact you and tell you about a tax case? Mr. Duke. That they probably had, and they wanted to associate with some counsel in Washington, and they knew that I was here quite often, and they wanted to know if I knew of any competent firms. The Chairman. Let us stick, now, to the cases that you solicited personally, cases where there was no lawyer in the case. Did any lawyer ever tell you about a case before you solicited the case? Mr. Duke. I don't recall right now if they ever have or not. The Chairman. Did Morgan ever refer any cases to you? Mr. Duke. Again, I would have to go through my files to search pretty thoroughly, and I don't recall whether he did or not. The Chairman. You do not remember whether he did or not? Mr. Duke. No, I don't. You see, Senator, it might sound asinine to you gentlemen here, but I was in a very diversified line of business, and I met quite a number of people, and I actually have. To recall things now, I might be able to in some instances. The Chairman. Have you seen Mr. Morgan since you have been in Washington on this trip? Mr. Duke. No. Mr. Flanagan. Have you called him? Mr. Duke. No. Mr. Flanagan. When was the last time you saw Ed Morgan? Mr. Duke. Again, I don't remember. It was a couple of years ago, I guess, maybe a year ago or maybe a couple of years ago. The Chairman. Do you recall any case now where Morgan or any other Washington attorney got the information on a tax case, and referred it to you? Mr. Duke. I don't recall, I really don't; and it is possible, but I couldn't say. He might have, and there is a possibility that he gave me some; and I could say, I did say this before, before the jury, I am not sure. They asked me, and I think that I told them yes, that some of these cases I did get, but I honestly--and you are asking me to be candid with you--I honestly don't remember, and I don't want to injure or impugn anybody's character about this by letting my imagination run away with me and say yes, they did, when I am not sure. The Chairman. You did tell the grand jury? Mr. Duke. It is possible I did, and I am not sure whether I did or not. The Chairman. You do not remember now that you told the grand jury that cases had been referred to you by Washington attorneys? Mr. Duke. I might have told the jury that, and I might have told the King committee that, but at that time--I want you gentlemen to understand it is no alibi--I was a pretty sick person when I appeared before both bodies, and I lost sixty pounds in about fourteen days. Mr. Flanagan. I have here a letter, a copy of a letter dated September 5, 1949, addressed to Welch, Mott & Morgan, opening, ``Dear Ed,'' and signed by typewriter, ``Russell W. Duke.'' I notice on page two of this letter, at the top of the page, you state: Ed, I have a lot of cases in California that I have to do a lot of bird-dogging on, and I hate like sin to go down there and bird-dog without clicking on a few. I wish that you would be able to secure some talent as I could use some hay. What are you talking about there? Mr. Duke. Again, I don't recall; it might be cases and it might not be. [The letter referred to was marked as committee's Exhibit No. 2, R. W. Duke, January 15, 1953, and is as follows:] Portland, 13 Oregon, September 5, 1949. Welsh, Mott & Morgan, 710 Erickson Building, Fourteenth Northwest, Washington, DC. Dear Ed: I was up to see Mr. Braman, as I told you over the phone today, and I received the information which I am passing on to you. The patent was originally issued on October 6, 1936, Patent No. 2056165, and then it was re-issued December 14, 1948, Reissue No. 23058, issued to Louis J. Bronaugh, of Portland, and Thomas I. Potter, of New York. The attorney in the case is Richard S. Temko. Louis J. Bronaugh is a Portland attorney. I shall try to get in touch with him and learn all I possibly can regarding the reissue. However, it is my understanding that Potter had put the patents on the refrigerator and a patent for a pump as his collateral to the Refrigeration Patent Corporation, and he had no authority to have the patent reissued exclusively to himself. However, he has accomplished having the patents reissued, as I have stated above. Mr. Braman has written Mr. Potter a letter and is awaiting the reply; and as soon as he receives Mr. Potter's reply, he is then going to retain your firm by paying the $2000 down and the percentage of the property. I tried to get myself retained as a public relations agent; however, I had a logical argument against it by saying if he retains a public relations agent on investigation and retains attorneys, the cost would probably cause the other stockholders to back down from going ahead in the suit, so will have to hold to the original agreement. I will participate in the monies that you get; however, I don't worry about that because we can always work something out satisfactory to all concerned. Ed, I have a lot of cases in California that I have to do a lot of bird-dogging on, and I hate like sin to go down there and bird-dog without clicking on a few. I wish that you would be able to secure some talent as I could use some hay. I am letting things quiet down on the coast by lying dormant and putting more effort in lining up the coming campaign. I assure you that the request you made of me on the phone that Senator Morse will go along 100 percent, because the longer you get to know him, the more you will learn that he is a man of his word; but he has had so much to do, and, as I understand, he has been given assurance that you are number one on the list. In all the time I have known Senator Morse, I have never known him to deviate or to say something that is not so. He either tells you in the beginning nothing doing, or he will go along. I am willing to gamble with you in any shape, form, or manner that you will be in as soon as the other chap resigns. I sincerely hope that the cases that are back there clear up so that we can start on something else. Again I repeat, ``I can use the hay.'' Howard has received an appointment as a commissioner on the city Boxing Commission. The job is gratis; however, it takes up a tremendous amount of his time. He also was appointed on a commission of 22 attorneys to study revising the city charter. That, also, is gratis. Plus his fishing, his handball, and his Oregon Medical Association's work, the good Lord only knows how he does it all. However, he gets by. He is in the best of health; and I am sure that if I told him I was writing you, he would tell me to say ``hello.'' I conveyed to Mr. Braman that urgency in this particular case was all important. Mr. Braman said that within three weeks time he would call me and be ready to retain your firm. As I told you over the phone, Mr. Mott talked to him on the phone the day before he was there; and Braman is very much impressed by Mott and your firm. Senator Morse gave you a big send-off when Braman had asked him as to what type of firm and people you are. If you ever read the letter that Braman received from Senator Morse, you will have to look into the mirror to see if you're the same individual because, Ed, he really boosted you very, very high. As you know, the talent is plentiful, and it is a psychological effect when one comes in cold and tells a person what he knows about him, so I hope sincerely that you will be able to secure some talent for me. With best wishes to you, Welsh and Mott, I remain, Sincerely, Russell W. Duke. Mr. Flanagan. It is quite likely that you were talking about cases? Mr. Duke. It is possible. Mr. Flanagan. When you are referring to ``talent''? Mr. Duke. It is possible. Mr. Flanagan. When you were talking about ``hay,'' is that money? Mr. Duke. Yes, sir. Mr. Flanagan. You weren't talking about hay for these horses? Mr. Duke. No. Senator Potter. What else could ``talent'' mean in that sentence? Mr. Duke. I don't recall at this time. Could I read the letter, and I could probably tell you. Mr. Flanagan. It is a rather long letter. Go ahead and read it if you wish. Mr. Duke. Again, I will have to tell you that I really don't recall what that referred to, and it could have been cases and it could have been most anything. Mr. Flanagan. I refer to the last page of this letter, page three, the second paragraph: As you know, the talent is plentiful, and it is a psychological effect when one comes in cold and tells a person what he knows about him, so I hope sincerely that you will be able to secure some talent for me. Mr. Duke. What year was that again? Mr. Flanagan. It is September 5, 1949. Do you know what you meant by that statement? Mr. Duke. No, I don't. Mr. Flanagan. When you say that ``it is a psychological effect when one comes in cold and tells a person what he knows about him,'' you are in fact referring to the fact if you come in with information on a man's tax case and start telling him about it, you are in a much better position to got yourself hired as public relations counsel? Mr. Duke. It is possible, but I wouldn't say yes or I wouldn't say no. Mr. Flanagan. Then it is possible, you say, that what you are referring to here is that it is very helpful to you if you can go in to a taxpayer or his lawyer and tell him some of the facts of the case, is that correct? Mr. Duke. I wouldn't say that that refers to that, no. Mr. Flanagan.  Mr. Duke. It is possible. Anything could be possible. Mr. Flanagan. Where would you get information on a tax case? Mr. Duke. Usually from the client or from the attorney. Mr. Flanagan. No, you are talking about ``going in cold.'' Mr. Duke. Well, I might not be referring to that. Mr. Flanagan. And telling a person. Mr. Duke. I might not be referring to a tax case. Mr. Flanagan. Are you in fact indicating here that you can get information from some government source, either Justice or the Internal Revenue Bureau, and go in and tell the client about it? Mr. Duke. I never got any information from the Internal Revenue Bureau or the Department of Justice. Mr. Flanagan. Did you get any indirectly from Justice or the Internal Revenue Bureau, here or in the field? Mr. Duke. Indirectly, yes, from the client or from the client's attorney. Mr. Flanagan. Did you ever ask Ed Morgan to go to the Justice Department, the Internal Revenue Bureau, or any other government agency, and get information in connection with a tax case? Mr. Duke. Other than I did in that Burns case. I didn't tell him where to go, and I asked him if he could get any information regarding the case. Mr. Flanagan. Did Morgan ever tell you--and I want you to consider this question carefully--did Morgan ever tell you that he had contacts in the Justice Department or Internal Revenue Bureau where he could get confidential information concerning tax cases? Mr. Duke. I don't know. You are wording it in such a way-- -- Mr. Flanagan. I will reword it. Did Morgan, Edward P. Morgan, ever tell you that he had contacts in the Department of Justice where he could get confidential information about tax cases? Mr. Duke. Well, I will answer it this way: He probably told me that he was in the Justice Department for eight and a half or nine years, and he knew his way and knew the handling and the federal procedure of handling cases in the Justice Department. Mr. Flanagan. I did not ask that question, Mr. Duke, and I will ask it again. Did Morgan ever tell you that he had ways and means to get confidential information from the Justice Department concerning tax cases? Mr. Duke. Not that I remember. Mr. Flanagan. Is it possible that he told you that? Mr. Duke. I doubt it, and I don't think a person with his mentality would make a statement like that. Mr. Flanagan. Did Morgan ever tell you that he had ways and means to get confidential information from the Internal Revenue Bureau concerning tax cases? Mr. Duke. I don't recall him ever making a statement like that to me. Mr. Flanagan. Did Morgan ever get information for you other than his efforts in the Inez Burns case, from either Justice or Internal Revenue? Mr. Duke. I don't know where he would get the information, but if I ever wrote him a letter, I would ask him to get whatever information he could pertaining to the particular case, for the attorney out there. Mr. Flanagan. Would he do that, or did he ever do that before he was actually retained as counsel? Mr. Duke. Not to my knowledge. Mr. Flanagan. He would only do that after he would be retained? Mr. Duke. Now, wait a minute. In the Inez Burns case, he was never retained, but he made an effort to get some information; but whether he went to Justice or where he went, I am inclined to believe that any information he would get, he would legally try to secure it from the proper source. Mr. Flanagan. Did you ever ask him to get information in tax cases before he was actually retained as counsel, other than the Burns case? Mr. Duke. Not that I recall. It is possible in other cases like the Burns case, too. I don't recall. Mr. Flanagan. I will refer to the letter of September 5 on page two. Mr. Duke: I assure you that the request you made of me on the phone that Senator Morse will go along 100 per cent, because the longer you get to know him, the more you will learn that he is a man of his word, but he has had so much to do, and, as I understand, he has been given assurance that you are number one on the list. What are you talking about? Mr. Duke. I don't know for sure, but I think--does that go on? I think that I read that letter, didn't I? Mr. Flanagan. Yes. Mr. Duke. Does that go on to say that someone was going to resign from a position? Mr. Flanagan. Yes. I will read it for you: In all the time I have known Senator Morse, I have never known him to deviate or to say something that is not so. He either, tells you in the beginning nothing doing, or he will go along. I am willing to gamble with you in any shape, form, or manner that you will be in as soon as the other chap resigns. Mr. Duke. I think that that wasn't only Senator Morse. I think there were quite a few senators. This Mr. McCoy was going to resign from the FCC, and Mr. Morgan, having his experience and knowledge of FCC and television work, I think made application for that position. Mr. Flanagan. Did you talk to Senator Morse on behalf of Morgan's candidacy as an FCC commissioner? Mr. Duke. I did. Mr. Flanagan. Did you ever assist or attempt to assist Morgan in getting any other federal jobs? Mr. Duke. I did. Mr. Flanagan. Which jobs? Mr. Duke. I assisted, and I don't know, the Tydings committee---- Mr. Flanagan. What did you do on his behalf so he got to be counsel to the Tydings committee? Mr. Duke. I talked to several senators that I knew, including Senator Morse, to see if it was possible to get him on that committee; and also on this OPS. Mr. Flanagan. When he was made national director of enforcement for OPS? Mr. Duke. He was made chief counsel, wasn't it? Mr. Flanagan. Inspector of enforcement. Mr. Duke. Yes, sir. Mr. Flanagan. What did you do on his behalf for that job? Mr. Duke. I talked to various senators and congressman to see if I couldn't get him on that. Mr. Flanagan. Who are the senators you talked to? Mr. Duke. I don't recall. I think probably Senator Kilgore, Senator Morse--again, I don't recall who all I talked to; whoever had anything to do with the committee or those positions. Mr. Flanagan. Did you ever know Eric Ellis from Portland, Oregon? Mr. Duke. I didn't know him; I met him. Mr. Flanagan. Did you ever meet his attorney, Mr. George Bronaugh? Mr. Duke. Yes, I met them both. Mr. Flanagan. Mr. Ellis owned the restaurant known as Mr. Jones' Restaurants, didn't he, in Portland? Mr. Duke. That is right, Mr. Flanagan. To your knowledge, did Mr. Eric Ellis have tax problems back in 1950? Mr. Duke. Well, now, I will have to answer that for you and it won't take much time but it will have to be answered properly. I had an accountant, and his name was Lester Talbott, who used to be in the Internal Revenue Department. Mr. Flanagan. Where is he from? Mr. Duke. Portland, Oregon. And it seems that this Eric Ellis was employed by a rancher or manufacturer in Tacoma or Spokane, Washington, and the Internal Revenue Department, in investigating this employer of Eric Ellis, found a discrepancy in his accounts. And Ellis was the bookkeeper or the accountant. Then he made an open deal with the Internal Revenue Department that if he would testify against his employer---- Mr. Flanagan. Who was the employer in this case? Mr. Duke [continuing]. I don't recall. There are records of it; Talbott has them. That if he would testify against his employer, he wouldn't have to file any income tax returns for the next few years. And Eric Ellis didn't file any returns for the next few years. So one day Ellis called me at my home and told my wife that as soon as I came in to come down to see him. And so I called Talbott and asked Talbott if he knew Ellis, and he said yes. He told me the story about Ellis. So I went down to see Mr. EIlis in his restaurant, and he asked me if I could do him any good or give him any help on his case. And I already had all of the knowledge and information, and I wanted him to tell me, and so he told me about it. I said, ``The best thing you can do is to go to the Internal Revenue Department and tell them how much you owe, and tell them you haven't filed returns for the past four or five years, and get out of it the best you can.'' So the next day he called me again and asked me to meet with him and his attorney in another restaurant that he owned and so we went there. They proceeded to get a fifth of whiskey and start plying me with whisky and kept asking me who in the Internal Revenue Department in Portland was aiding in these tax cases. I told them it was asinine in questioning me on that, and you couldn't get me drunk on it, and that as far as their problem was concerned the best thing he could do was go ahead and settle with Internal Revenue Department themselves. I left them with that, and I haven't seen them since, and I understand the case was settled for about $4,000. Mr. Flanagan. This second meeting that you had, with Mr. Ellis, you say his attorney, George Bronaugh, was present? Mr. Duke. Yes, sir. Mr. Flanagan. Who else was in the room besides yourself and George Bronaugh and this man? Mr. Duke. That is all. Mr. Flanagan. At Mr. Jones' Restaurant? Mr. Duke. They were all called that. Mr. Flanagan. This was the one on International Avenue? Mr. Duke. Not on International Avenue. Mr Flanagan. The one on Sandy Avenue? Mr. Duke. No. It was on Interstate Avenue. Mr. Flanagan. Interstate Avenue? Mr. Duke. Yes, sir. Mr. Flanagan. At that time, did you try to prevail upon either Mr. Ellis or his attorney to hire you as public relations counsel? Mr. Duke. No, indeed. Mr. Flanagan. Did you have any discussions about the fact that you might be their public relations counsel? Mr. Duke. No, indeed. They were trying to retain me, and I refused, because I already knew the entire story on Ellis, and I didn't want to have anything to do with Ellis. Mr. Flanagan. At that conversation in Mr. Jones' Restaurant, the only one you say you ever had with Ellis and Bronaugh concerning their tax matters---- Mr. Duke. That is right. Mr. Flanagan [continuing]. Did you tell them, either directly or indirectly, that you could secure confidential information? Mr. Duke. No, sir. They were questioning me on that to see if I could, and I told them not. Incidentally, the same day I called up the Internal Revenue Department and gave them that very information, that these two men were questioning me on that. Mr. Flanagan. Did you at that time tell them that you could get information out of the Justice Department or the Bureau of Internal Revenue? Mr. Duke. Absolutely, I did not. I would never make a statement that I could get information from Justice or the Internal Revenue, because it is impossible to do so. Mr. Flanagan. Did you at that meeting in that restaurant with Ellis and Bronaugh, tell them, either directly or indirectly, that you could offer your services as a public relations agent on a monthly fee basis? Mr. Duke. No, I told them how I operated. Mr. Flanagan. But did you offer your services to Mr. Ellis or to his attorney? Mr. Duke. Not to my knowledge did I ever offer my services to either one of those gentlemen. Mr. Flanagan. Are you quite sure that you didn't offer your services to those gentlemen? Mr. Duke. Well, I will answer it this way: By the time we hit that first fifth and the second fifth, no one knew what they were talking about, and---- Mr. Flanagan. Just a moment. A few moments ago you said that, as I recall your testimony, after you left this meeting you went to the Bureau of Internal Revenue and told them. Mr. Duke. I did. Mr. Flanagan. Were you still drunk? Mr. Duke. No. I am telling you they tried to get me drunk, but they were plenty drunk. Mr. Flanagan. But you weren't? Mr. Duke. I was feeling ``high,'' but I wasn't drunk. Mr. Flanagan. You knew what you were doing and what you were saying? Mr. Duke. I certainly did. Mr. Flanagan. Did you tell these men, either directly or indirectly, that you could follow through with various offices where their case might be, their tax case? Mr. Duke. Their case? Mr. Flanagan. Yes. Mr. Duke. That would be impossible, and again I will have to answer it this way: The case was already set, and it was already set for them to adjust the case, and the deal was already made with the Internal Revenue Department by themselves, to adjust the case in Seattle, and they didn't require anybody's help. Mr. Flanagan. Did you ever tell these gentlemen at that time at that meeting that you could follow other cases through the various departments? Mr. Duke. I wouldn't discuss any other cases with them. The Chairman. I do not believe you have answered that question. Mr. Flanagan. Did you in fact tell them that you had followed other cases or could follow them through the various departments of government? Mr. Duke. I possibly did, yes. Mr. Flanagan. Did you or didn't you? Mr. Duke. I don't recall. Mr. Flanagan. Did you tell them that tax cases could be killed in the Department of Justice by you or people that you knew? Mr. Duke. No. That I would emphatically deny. Mr. Flanagan. Did you tell them, either directly or indirectly, that through certain contacts that you might have, that you could stop cases in the Department of Justice? Mr. Duke. I wouldn't make no such statement, no. Mr. Flanagan. Did you ever state, either directly or indirectly, that you could stop or fix tax cases at any place in the government? Mr. Duke. Nowhere would I make a statement like that, that I could fix tax cases. Mr. Flanagan. Did you make any such statement to these gentlemen at that time? Mr. Duke. No, I did not. The Chairman. Can you go back three questions and read that? [The record was read by the reporter.] The Chairman. Does that mean you did not make such a statement? Mr. Duke. Not to my knowledge did I ever make such a statement, no. Mr. Flanagan. Did you state, either directly or indirectly, to those gentlemen, that is, Ellis and Bronaugh, or did you intimate to them, that if their tax case went to the Justice Department that they would have to hire any certain Washington attorney? Mr. Duke. Mr. Flanagan, if I might state--and this committee should know this--there was an attempt made to entrap me by those two gentlemen, and I had information, and I have Mr. Talbott to testify to that. I was told that Ellis was going to try to entrap me. You are asking me a lot of questions pertaining to these two gentlemen, and I told you that I knew their efforts were to try to trap me, and when I went to talk to these gentlemen I spent the first evening, I spent about ten minutes with Mr. Ellis in his restaurant, and left him, and told him I couldn't do anything for him, and absolutely left him, and the next day they called again and asked me to meet him, and I met him there, and I asked him what he wanted, and he said he wanted to talk to me about something else beside the tax case. And I met him there, and I met the other gentleman, and he never introduced me to the other gentleman as being an attorney, and he brought out a fifth of whisky, and said ``Have a drink.'' And I said, ``Sure, I will.'' And I let them drink theirs first, and we kept on visiting and talking and nothing else. And then they started asking me a lot of questions, and I started telling them, and I said, ``Look, I am not answering anything like that.'' I knew what they were wanting, and I knew they were trying to frame me, because he was already involved in one frame of his employer, and, now, if these men have given a statement and they would swear that I made such statements, and I sit here and say no, and, these men swear that I did make such statements, here I am being framed by a man that framed or helped frame another man. Senator Potter. Is that what you mean by being framed? Mr. Duke. They tried to entrap me into statements or into a deal in order to involve me in tax matters, because Ellis was sore at Talbott, and Talbott used to be his accountant, and after Talbott found out what he had done, and what he had done in Spokane with his former employer, he and Talbott got very bitter. Senator Potter. Why would they go out of their way to frame you? Mr. Duke. After all, I can say this, without being egotistical, because I learned a long time ago that ego is an anesthesia provided by nature to deaden the pain of a damned fool, and I don't want to be placed in that category, but politically I was pretty big in Oregon, and there were many efforts made to discredit me in Oregon. Senator Jackson. You were pretty big politically? Mr. Duke. Yes. Senator Jackson. What is that? Mr. Duke. I have been in labor and I have for quite a long time controlled--headed one of the largest locals in the United States. Senator Jackson. Controlled it? Mr. Duke. No, I headed it. I didn't control it. Senator Jackson. What local was that? Mr. Duke. Local 72 of the Boilermakers, AFL. Senator Jackson. You were president of it? Mr. Duke. No. Senator Jackson. Where did you control it from? Mr. Duke. I withdrew that word ``control'' and I said---- Senator Jackson. Where did you head it from, in what capacity? Mr. Duke. On the committee, the executive committee. Senator Jackson. You controlled the committee? Mr. Duke. I didn't say ``control.'' I withdrew that. Senator Jackson. What did you head? Mr. Duke. I headed the Boilermakers Local. Senator Jackson. President of it? Mr. Duke. No, I wasn't president of it, and we had no president. And we had a lawsuit and we had rather a bitter fight about two or three years and we finally got rid of the president and the business agent, and we operated the local from a committee. Senator Potter. Then if you were active politically, these people must have assumed that you could use political influence for tax adjustments. Mr. Duke. No, sir, those people were maneuvering for someone else. Mr. Flanagan. Mr. Duke, I would still like to pursue this question further and get a categorical answer from you if I could. I will rephrase my question. At this meeting with Ellis and his attorney, Bronaugh, in that restaurant on that day, did you state, directly or indirectly, if the Ellis case went to the Justice Department they should hire a lawyer in Washington by the name of Morgan, or any other lawyer? Mr. Duke. It is possible I might have told them that, yes. Mr. Flanagan. Did you recommend Morgan to them as a lawyer? Mr. Duke. It is possible that I might have. What year was that? Mr. Flanagan. 1950. Mr. Duke. The whole thing is wrong. I didn't meet him until 1949, and in 1950 he was broke and he was out of the restaurant business. Mr. Flanagan. You now state that when you had this meeting, whether it be in 1949 or 1950, the only meeting you say you ever had with Ellis and his attorney, you now state that you did not indicate that if their case went to Justice and they would have to hire a Washington lawyer? Mr. Duke. Repeat that again. Mr. Flanagan. Did you state at that meeting that these gentlemen would have to hire a Washington lawyer? Mr. Duke. I told you I don't recall anything that was stated at that meeting. Mr. Flanagan. Did you indicate to them that if their case got to the Justice Department, they would have to get Ed Morgan or else they would lose that case? Mr. Duke. I don't recall making any such statement. Mr. Flanagan. Did you state to them or indicate to them that they would have to hire Morgan if their case went to Justice so that they could be sure to win their case? Mr. Duke. Again, I could not answer directly or indirectly because I don't recall. Mr. Flanagan. You have no recollection of what you said? Mr. Duke. No, I don't. Three years ago, was that, and I talked to quite a number of people. Mr. Flanagan. Did you report to the Internal Revenue Department that day that you went to them? Mr. Duke. I certainly did. Mr. Flanagan. What did you tell them? Mr. Duke. I just told them of the meeting, and what took place at the meeting, and who was there. Mr. Flanagan. Did you tell them anything about the fact that Morgan may have to be hired in these cases? Mr. Duke. I don't recall. Mr. Flanagan. Did you think, in fact, that it was necessary to hire Morgan in Justice Department cases? Mr. Duke. I don't know why. There are other competent attorneys here that are probably just as capable. Mr. Flanagan. Did you recommend Morgan as an attorney to Ellis or Bronaugh? Mr. Duke. It is possible, and I don't recall. Mr. Flanagan. Now, your testimony here is very confusing. First of all, you say that you recommended nothing to them; and now I ask you, did you or did you not recommend Morgan? Mr. Duke. I didn't say that I didn't recommend anything to them. It is possible that I recommended Morgan, and I don't recall. Mr. Flanagan. Did Morgan contact you at that restaurant when you were there? Mr. Duke. No. Mr. Flanagan. Did he call you on the telephone? Mr. Duke. He wouldn't know to call me. How would he know to call me at a restaurant? He would call me at my home. Mr. Flanagan. Who did you contact in the Bureau of Internal Revenue to give these facts to? Mr. Duke. I don't recall. It might have been, someone in the intelligence unit. Mr. Flanagan. In Portland? Mr. Duke. Yes. Mr. Flanagan. Did you ever handle any cases involving claims against the government? Mr. Duke. I did. Mr. Flanagan. Claims bills pending in Congress? Mr. Duke. I don't get that. Mr. Flanagan. Bills for claims against the government that were in the Congress? Mr. Duke. Yes. Mr. Flanagan. Did you ever receive any money from any persons or any firm to assist them in putting their claims bills through the Congress? Mr. Duke. In this way: Every time I had to come back here, they paid my fare and expenses. Mr. Flanagan. Did you come back here to promote their claims through the Congress? Mr. Duke. No, not at first. Mr. Flanagan. Well, at the last, did you; at any time did you? Mr. Duke. After the bill was introduced in the Congress I had to come back here and appear before the various committees to try to get the bills through. Mr. Flanagan. Did you discuss this bill with any members of the House or the Senate? Mr. Duke. I did. Mr. Flanagan. Who were your clients in that case? Mr. Duke. Herman Lawson, and Nelson Company. Mr. Flanagan. Was American Terrazzo Company one of your clients? Mr. Duke. No. Mr. Flanagan. Did you go to American Terrazzo and attempt to get them to hire you? Mr. Duke. No. Mr. Flanagan. Did you discuss this case with anyone connected with American Terrazzo? Mr. Duke. I did. Mr. Flanagan. With whom? Mr. Duke. I do not recall at the moment. Mr. Nelson and Mr. Brace of both companies were putting up the money, and had already spent quite a lot of money on this before I ever entered into this, and I know Brace and Nelson, we have been very close friends for a number of years, and I knew about this case. They were getting tired of spending their money for it, and I asked them what they were doing on it, and they told me, and I said, ``The best thing you can do with this case is to go right directly to the federal works or Public Works Administration and get to the chief counsel and discuss the case with him, and find out how far you can go with it.'' Well, they told me to go ahead and try it. They paid my expenses, and we came out here, and I met with the chief counsel of the federal works, or whatever bureau or department that bill or the claim was against, and discussed the case with them, and they told me what to do. And in fact, they prepared the bill, and said that the claim was justifiable and it should be paid. I was just representing Mr. Nelson at the time, and he paid $500, I think, for my fare, round-trip fare to come out here. Then Mr. Frick, who was the chief counsel, stated that the bill would have to be put into the Congress. Mr. Flanagan. Did you ever discuss this case on behalf of your clients with any member of Congress? Mr. Duke. Yes, I have. Mr. Flanagan. With whom? Mr. Duke. I don't recall. Various congressmen. Mr. Flanagan. Did you discuss it with Senator Morse? Mr. Duke. I did. Mr. Flanagan. Did he introduce a bill after your discussion? Mr. Duke. He introduced two of them. Mr. Flanagan. On your behalf? Mr. Duke. We don't want to get Senator Morse involved in that. I brought Mr. Nelson and Mr. Brace back here, and they discussed the bill with Senator Morse. Mr. Flanagan. Did you ever discuss the bill with Senator Morse? Mr. Duke. Yes, later on, after he introduced it. Mr. Flanagan. And you were discussing it on behalf of your clients? Mr. Duke. Yes, sir. Mr. Flanagan. This was the San Francisco case? Mr. Duke. That is right. Mr. Flanagan. Were you at that time registered as a lobbyist? Mr. Duke. No. I inquired about that, and the Justice Department, or whoever it was in the Justice Department, told me that as long as it was not--a person couldn't register as a lobbyist unless he was lobbying to change legislation and laws of our land. But on a private claim bill, if you visit the various senators and congressmen to put it through, it was not classified as lobbying, and it wasn't necessary for me to register. Senator Potter. Who gave you your advice in the Department of Justice? Mr. Duke. I don't recall now, and also it was the counsel for the committee headed up, I think, if I am not mistaken, and I might be in the name, by Congressman Buchanan, was it? Wasn't he the chairman of the Lobby committee? Senator Potter. Yes. Mr. Duke. Their chief counsel told me the same thing, so long as it was not lobbying to change laws of this legislature. Senator Potter. Do you recall who your contact was in the Department of Justice who gave you that information? Mr. Duke. I called the Department of Justice and I asked them--they asked who I wanted to talk to, and I explained, and then they referred me to whoever it was, and I do not recall. Senator Jackson. Did you go down and see them? Mr. Duke. I talked to them on the telephone. Mr. Flanagan. In connection with this claims case, Mr. Duke, did you ever, directly or indirectly, indicate to anyone connected with American Terrazzo that if they didn't hire you as public relations counsel, you would see that their name would be taken out of the bills that were then pending? Mr. Duke. I did not make that kind of statement. If I can tell you what happened in that, you will understand it. Mr. Nelson and Mr. Brace decided that they were not going to foot the bills for all of the other people, all of the other claimants, and so we had a meeting in my room, Mr. Nelson and Mr. Brace and everybody involved, and they called them to come in. And I happened to be in San Francisco with Mr. Bobber. They discussed this case and they told the other claimants that they would have to proportionately prorate the cost of this bill, and put up their share of it. Senator Potter. What cost of it? Mr. Duke. Mr. Brace and Mr. Nelson had already spent several thousands of dollars retaining attorneys and trying to get the bill through. They advanced my expenses coming out here, and they felt justifiable that all of these people, that they should get together and prorate their share. Now, I had no fee. If Nelson and Lawson would get their claim, then they were to pay me. Senator Potter. How much? Mr. Duke. We would have settled that later. Senator Potter. You took on a job without any amount being set as to what you would receive? Mr. Duke. That is right, Senator, in this particular case. We are very close friends, both Mr. Nelson and Mr. Brace and myself, and we have known each other for a number of years. Senator Potter. Who made the first contact with Senator Morse? Did you make it or did Mr. Nelson and Mr. Brace? Mr. Duke. We all three came out here together, and I took them in to Senator Morse's office, and they explained to Senator Morse the predicament they were in, and then Mr. Frick contacted Senator Morse and wanted to know, and Frick prepared the bill. Senator Potter. What was your $500 round-trip expense money, where did that come from? Mr. Duke. In the beginning, they paid my fare coming out here. Senator Potter. You mean when you came out together? Mr. Duke. That is right. Mr. Flanagan. Did you tell Senator Morse that you were getting a fee or expenses out of this claims case? Mr. Duke. I don't think so. Mr. Flanagan. Did you ever tell him that you were getting fees or expenses or acting as public relations counsel in any tax cases? Mr. Duke. I don't think so, no. Mr. Flanagan. Did you ever ask for his assistance in a tax case, not involving a constituent of his in the State of Oregon? Mr. Duke. Not assistance. I would ask him, there was one particular case that comes to my mind, the L. diMartini case, where the Internal Revenue Department agent ruled that because a man conducted his business at the age of ninety, even though he was active in it, he was not entitled to the salary he was getting. Mr. Flanagan. Was that a California case? Mr. Duke. That is right. Mr. Flanagan. Did you ask Senator Morse to appear in that or any other case down at the Internal Revenue on behalf of any of your clients? Mr. Duke. I don't think that I have. I think that Mr. Kaiser, if I am not mistaken, asked him to. Mr. Flanagan. Who is Mr. Kaiser? Mr. Duke. He is the comptroller and head of the L. diMartini Company. Mr. Flanagan. That is a California company? Mr. Duke. That is right. Mr. Flanagan. Did Senator Morse ever know you were acting as public relations counsel for these taxpayers? Mr. Duke. I don't know. Mr. Flanagan. That he might be contacting Internal Revenue on behalf of? Mr. Duke. I wouldn't know if he did. Mr. Flanagan. Did you ever tell him you were getting fees for representing these taxpayers as public relations counsel? Mr. Duke. Not to my knowledge. Mr. Flanagan. So, then, you say that he had no knowledge of the fact? Mr. Duke. I wouldn't say that, whether he had knowledge or not, but I don't think that I ever discussed it. Mr. Flanagan. You never brought that to his attention? Mr. Duke. I don't think so. Mr. Flanagan. Did he ever tell you or bring it to your attention that you were acting as public relations counsel for these people? Mr. Duke. I don't recall. Senator McClellan. May I ask two or three questions, and I have to go. I would like to ask you, Mr. Duke, how you became known as a tax public relations man, or government public relations man, to contact different agencies of government? Mr. Duke. Well, Senator, I have been coming back here for quite a number of years. Senator McClellan. For what? Mr. Duke. For various--my own businesses, and I manufacture trailers, and I had to come back here to get cleared through the various bureaus of the government, and I manufactured various and sundry items that had to be cleared through Washington, both in the Internal Revenue Department and in the old OPA, and the War Production Board, and the army and the navy; and coming back here at that time, I got acquainted here with Washington quite well. Senator McClellan. Did that help to qualify you in any way as a tax public relations expert? Mr. Duke. Well, I don't know whether it qualified me, but you take a person that comes out here to Washington and hasn't been here before, he finds it very difficult, as I did, and I spent three months here before I found out that I was to go to the Miscellaneous Tax Division. For three months I was looking for the Excise Tax Division of the Internal Revenue. Senator McClellan. You got experience in knowing where to go to in the Internal Revenue Bureau or the Department of Justice, so that you could guide others and counsel them and charge a fee for it? I am trying to get your background, and how you got into this, and how people knew that you had some services to sell. Mr. Duke. From practical experience and coming back here on my own work. Senator McClellan. In tax matters? Mr. Duke. Oh, yes, I was involved. You see, in everything, trailers and various and sundry items, there are excise tax and trailer tax, and there are various numbers of them, and in one trailer there are eight or nine taxes that you have to pay. Senator McClellan. I understand. And did you have problems with the revenue bureau here in Washington? Mr. Duke. Oh, yes, I did, for several years. Senator McClellan. So you had some practical experience in contacting them? Mr. Duke. That is right. Senator McClellan. Now, did you maintain an office while you were carrying on these public relations activities? Mr. Duke. I did. Senator McClellan. Where? Mr. Duke. Portland, Oregon. Senator McClellan. Do you have an office there now? Mr. Duke. No, I haven't had an office there since the explosion, in 1950. Senator McClellan. In 1950? Mr. Duke. That is right. Senator McClellan. Did you advertise it as a public relations service? Mr. Duke. I did. Senator McClellan. Which you had to offer? Mr. Duke. I did. Senator McClellan. Did you keep records or files pertaining to your business? Mr. Duke. I have. Senator McClellan. Did you keep all of your files? Mr. Duke. Every scrap of paper from the time I started business. Senator McClellan. Every scrap of paper? Mr. Duke. Yes. Senator McClellan. Have these files been subpoenaed by this committee? Mr. Duke. They have. Senator McClellan. Are they now in the possession of the committee? Mr. Duke. I wouldn't know. Senator McClellan. Do you know whether they have obtained and have in possession now all of your files, or only a part of them? Mr. Duke. I wouldn't know. You would have to ask the chief counsel. Senator McClellan. May I ask you, then, have you disclosed to the committee or to the chief counsel of the committee, Mr. Flanagan, the whereabouts of your files so that they may be made available to the committee? Mr. Duke. To the best of my knowledge and ability, yes. Senator McClellan. All of your files? Mr. Duke. Yes, sir. Senator McClellan. You know where they all are or where they were? Mr. Duke. I didn't know where they all were, and I had an idea, and I so disclosed to the committee counsel. Senator McClellan. You have disclosed that? Mr. Duke. That is right. Senator McClellan. I have not seen these letters, but there seems to be one word that is causing some inquiry; in the two letters that have been referred to here in this preliminary questioning, the word ``talent'' appears and seems to have some particular significance as a code word or as related to something other than ``talent,'' the meaning of which was known to you and to Mr. Morgan. Mr. Duke. That is right. Senator McClellan. I do not know whether there are other letters that have the use of this word to convey some particular meaning or impression. Possibly there are. So I will ask you, do you know if that is a word that you use frequently in your correspondence with Mr. Morgan? Mr. Duke. I think that if you go through all of my files and correspondence, I think that you will find that that expression and word is used to various other people, and not necessarily lawyers. Senator McClellan. I understand it may have been used in others, but I want to talk about this correspondence here with Mr. Morgan, and did you use it frequently in your correspondence with him? Mr. Duke. It is possible. I would have to look through my files to see how often I used it. Senator McClellan. If you used it frequently, did it have one particular meaning, and one particular significance? Mr. Duke. Right at this moment, I couldn't tell you what it meant. Senator McClellan. At any time, whether the first time you used it or the last, or in between? Mr. Duke. I wouldn't know; right now I wouldn't recall. Senator McClellan. Did it have reference--and you know enough about these two letters to know whether it had reference to the common and accepted meaning of the word ``talent?'' Mr. Duke. No, not to its common and accepted meaning. Senator McClellan. It did not? Mr. Duke. No. Senator McClellan. Then what did it have reference to? Mr. Duke. I couldn't tell you, because I don't recall right at this time. Senator McClellan. Would you say that wherever and whenever you used it, in your correspondence with him, since it did not refer to talent in the common accepted meaning of the word, that it did have reference to something specific and in using it you used it for that specific expression or to convey that specific meaning each time you used it? Mr. Duke. It is possible. Senator McClellan. Well, this is what I am trying to determine. You would not use the word ``talent'' one time to mean a race horse, and another time to mean hay or money, or another time to mean clients, and it had a continuous meaning as between you and Morgan when you used the word? Mr. Duke. It is an expression, probably, of mine, and I think, as I told you, if you go through other correspondence to various people, it might not be professional people, I might be referring to talent, and I---- Senator McClellan. How would he know, if you used it to mean different things, how did Ed Morgan know what you meant when you used the word, which one you meant? Mr. Duke. I might have talked to him on the telephone and I might have talked to him in person before I left Washington. Senator McClellan. And told him that when you used the word ``talent,'' it meant so-and-so? Mr. Duke. Not necessarily. I mean discussing various things. Senator McClellan. I am trying to determine how he understood what you meant by the word ``talent'' if you did not know yourself. Mr. Duke. If I could remember right now what I was referring to, I could tell you right now what it meant. Senator McClellan. The point is, you did not use it in the sense of the correct meaning of the word, you admit that. Mr. Duke. The common accepted meaning. Senator McClellan. That is right. You did not use it to convey that meaning? Mr. Duke. It is possible, and I don't recall now what I used it for. Senator McClellan. Well, evidently it had quite a significance between the two of you; you acknowledge that? Mr. Duke. It might have had, yes. Senator McClellan. It might have had? Do you not know that it had? Mr. Duke. No, I don't. Senator McClellan. Do you not now know that it had? Mr. Duke. Yes. Senator McClellan. And you used it to convey that particular meaning rather than to use the normal term that would convey the meaning to someone else? Mr. Duke. I really do not recall what I meant by that expression in that letter. Senator McClellan. Do you think that you will be able to recall what you meant by the use of the word ``talent'' in your correspondence? Mr. Duke. It is possible. Senator McClellan.  Mr. Duke. It depends, and I will tell you why it depends on that. As I told you, I was in this explosion, and I might leave here and land in a hospital and be in a hospital for the next six months, and I told you I have a malignancy that is spreading, and I have X-rays in my files to prove it, and this malignancy spreads and sometimes I will blank out for a couple of weeks at a time, and so you are asking me if it is possible to remember---- Senator McClellan. That is the reason you are saying it may not be possible for you to remember? Mr. Duke. I didn't say that. It is possible that it might be that I might blank out, and I might be blank for maybe a month or two weeks. Senator McClellan. You might not live to remember, if we want to indulge in extreme speculations, but I am not trying to go into your physical condition in detail. You are saying normally you think you would be able to remember; if that is right, Okay. Mr. Duke. It is possible. I don't know, Senator. As I told you, I am trying to keep myself calm; and excitement, I hemorrhage. Senator McClellan. I do not want you to get excited. Mr. Duke. I am under a pressure right now, and that pressure can blank me out. Senator McClellan. Let me ask you another question. What did you mean by bird-dogging? Mr. Duke. Bird-dogging cases, television cases. Senator McClellan. Soliciting cases? Mr. Duke. Yes, soliciting any kind of cases. Senator McClellan. Then what service did you actually have to sell to prospective clients and to those who employed you? What service did you actually sell to them? Mr. Duke. Can I give you an example? Senator McClellan. I would like for you to answer the best way you can. Mr. Duke. A couple of friends of mine had---- Senator McClellan. I understand--first may I qualify that. It is my understanding that you are not a lawyer. Mr. Duke. No. Senator McClellan. You are not an accountant? Mr. Duke. No. Senator McClellan. And yet you engage in public relations dealing with those two professions, primarily? Mr. Duke. Well, public relations, anyone can go into that, and it doesn't---- Senator McClellan. I understand you can go into it, but you are selling something related to the profession of a lawyer or public accountant primarily, or to government. Mr. Duke. That is right. Senator McClellan. One of the three, just what you had to sell to your clients. Mr. Duke. I will give you an example. There were a couple of friends, four friends of mine, that started with about $1500, and in six years' time they ran this business, a wood business, to about, I guess, maybe a $2 or $3 million business. All of the time they retained the same services of a small bookkeeper, that is all he was. So we met, they came after me to see what I could do to help and they wanted to retain me as a public relations expert. I met with them and with their accountant, and I went over the books and realized he was absolutely wrong; that under the present bookkeeping system or the accounting system that he had set up for the firm, it would cost the firm a fortune, and they were making money but paying it all out in taxes and holding nothing back in reserve, and they were ready to go bankrupt, and they retained me at the sum of $250 a month. They could have done this themselves. They had six years previous to do it in. I went down, and retained the services of a certified public accountant, brought them up to the firm, set up their books, set them up a new payroll system, and they set up their machinery and their equipment and their buildings on a lesser number of years to depreciate, and I saved them thousands of dollars. Senator McClellan. I am not primarily interested at the moment in specific cases. I am trying to determine, as a public relations man and in your relations here with Mr. Morgan, a Washington attorney, and with others in handling claims against the government, or in selling some service to clients in matters relating to the federal government, what you actually sold them. You did not sell them professional ability as a lawyer. Mr. Duke. No. Senator McClellan. You did not sell them professional ability as an accountant. Mr. Duke. Not a professional accountant, no. Senator McClellan. All you sold them was placing them in contact here with somebody whom you thought could help them? Mr. Duke. No, not necessarily. Senator McClellan. What else besides that? Mr. Duke. I would go over their entire case, over all of their books, and I would probably spend maybe two or three weeks going over them to determine, to see if they had a justifiable cause to oppose the Internal Revenue Department on their case; and if I so found, I would so advise the client. Senator McClellan. Then what further service did you perform? Mr. Duke. Then, I would advise them to retain competent counsel. Senator McClellan. And you would recommend that counsel that you thought was competent? Mr. Duke. That is right. Senator McClellan. Now, that is the service that you undertook to perform to earn the fees you charged or which they would be willing to pay? Mr. Duke. That is right. Senator McClellan. I just wanted to get that clear. Senator Jackson. Just one question. Senator McClellan. I am sorry. I have to go, and I wanted to get in the record just what his business was in the thing. Senator Jackson. I have one question along that line. The Chairman. I would like to say they have got to put him on a plane at six o'clock. Senator Jackson. What is the reason for using these code words, ``talent,'' and so on? Mr. Duke. Again, I will have to go back, and I don't recall. Senator Jackson. What were you trying to cover up? Mr. Duke. Well, let us put it this way. My vocabulary is limited, and I probably used it for a varied expression. Senator Jackson. You have admitted that it is not used in or it was not used in its usual sense or its usual meaning and context. Mr. Duke. No. Senator Jackson. What were you trying to cover up? Mr. Duke. I didn't admit specifically it was not used in that as its common acceptance, and I say it is possible that I used it for not its common acceptance. Senator Jackson. Why, then, would you use it not in its accepted sense, and what were you trying to cover up? Mr. Duke. Nothing to cover up, and I do not recall why I used it. Senator Jackson. You are not using it in its usual sense? Mr. Duke. That is true but I still don't recall why I used it. Senator Jackson. You were trying to cover something up. Mr. Duke. I never tried to cover anything up, and if I had tried to cover anything up I would have destroyed all of my files, and there is nothing in my files that I am trying to cover up, and they are all available. Senator Jackson. You are using code words here. Mr. Duke. Not necessarily. Senator Jackson. Who would know what you meant by ``talent'' and the horse race business here, except you who were sending it and Mr. Morgan on the other end? Mr. Duke. Nobody here would, but suppose you and I were friends, intimately, and we went around together and we used various expressions, and perhaps I might have been using one, and you and I would get to know each other very well and have various expressions, and there it would be a lot better than a lot of people---- Senator Jackson. Now, maybe you have given an answer. Senator Potter. Could I ask one question? You sold your services as a public relations man? Mr. Duke. Not necessarily as a public relations man, just agent. Senator Potter. In your testimony, you said that your office--you had an office? Mr. Duke. My office was a diversified office. The Chairman. Senator Potter, I had hoped we could let everybody question the witness fully, and I had hoped the congressmen would have a chance, but the traffic is extremely bad and it is getting late. You are still under subpoena, Mr. Duke, and you are now ordered to return here on February 2, at ten o'clock in the morning, unless notified of some other time. And you will call the committee collect, on the Friday before February 2, you understand. Mr. Duke. How long is that from now? Mr. Flanagan. Two weeks from Friday. Mr. Duke. That is all right. The Chairman. I may say to the congressmen and senators here, I think it would be well, if we are contacted by the press, if we would refuse to comment on this matter, in view of the fact we are in such a preliminary stage. [Whereupon, at 5:15 p.m., a recess was taken until 10:00 a.m., Monday, February 2, 1953.] RUSSELL W. DUKE [Editor's note.--Edward P. Morgan (1913-1986) served as an FBI agent from 1940 to 1947, rising to the rank of chief inspector. He was also a staff member of the joint committee that investigated the Japanese attack on Pearl Harbor. In 1947 he joined the Washington law firm of Welch, Mott and Morgan, specializing in corporate, tax, and international law. In 1950 he became chief counsel to the special subcommittee of the Senate Foreign Relations Committee, chaired by Senator Millard Tydings, that investigated Senator McCarthy's charges of Communists in the State Department. During the Korean War, in 1951, Morgan became chief of the enforcement division of the Office of Price Stabilization. He resigned that position in 1952 and went to Wisconsin to campaign against Senator McCarthy's reelection. After Russell Duke refused to return to testify in public, Morgan was not called back to give public testimony. In its annual report, the subcommittee noted: ``There is no indication that Duke performed any legitimate service for any taxpayer. He possessed no legal, accounting, or other technical ability. Not a lawyer himself, he utilized the services of attorneys and primarily the services of Edward P. Morgan, of Washington, D.C. In the cases investigated by this subcommittee, Russell W. Duke received a total of $32,850 in fees, and approximately $2,500 in expenses; and Attorney Edward P. Morgan received $13,700 in fees, and $450 in expenses. Completion of this investigation is awaiting the resolution of Duke's criminal trial. In the meantime, the evidence concerning Morgan's conduct is being submitted to the Washington, D.C., Bar Association.'' However, Duke was acquitted and Morgan remained a member in good standing in the District Bar. In 1980 and 1985 he served as a member of the Presidential Commission on Executive, Legislative and Judicial Salaries, and in 1985 was named to the President's Commission on the Bicentennial of the United States Constitution. Edward P. Morgan did not testify in public session.] ---------- FRIDAY, JANUARY 16, 1953 U.S. Senate, Senate Permanent Subcommittee on Investigations of the Committee on Government Operations, Washington, DC. The subcommittee met, pursuant to Senate Resolution 251, agreed to January 24, 1952, at 10:30 a.m., in room 357 of the Senate Office Building, Senator Karl E. Mundt presiding. Present: Senator Karl E. Mundt, Republican, South Dakota; Senator Everett M. Dirksen, Republican, Illinois; Charles E. Potter, Republican, Michigan; Senator John L. McClellan, Democrat, Arkansas; Senator Henry M. Jackson, Democrat, Washington. Present also: Representative Kenneth A. Keating, Republican, New York; Representative Patrick J. Hillings, Republican, California. Present also: Roy Cohn, chief counsel; Robert Collier, chief counsel, House Subcommittee to Investigate the Department of Justice, Committee on the Judiciary; William A. Leece, assistant counsel; Jerome S. Adlerman, assistant counsel; Robert F. Kennedy, assistant counsel; Ruth Young Watt, chief clerk. Senator Mundt. The committee will come to order. Mr. Cohn, who is our first witness? Mr. Cohn. Our first witness, Mr. Chairman is Mr. Edward P. Morgan. Senator Mundt. Will you be sworn? Do you solemnly swear to tell the truth, the whole truth, and nothing but the truth, so help you God? Mr. Morgan. I do. TESTIMONY OF EDWARD P. MORGAN Senator Mundt. For the purpose of the record, will you give the committee your name and address, present position and occupation? Mr. Morgan. Edward P. Morgan, residence 3000 39th Street, Northwest, Washington, D.C.; business, law office, 710 14th Street, Northwest. Senator Mundt. Now, Mr. Cohn will proceed with the questioning. Mr. Cohn. Mr. Morgan, for how long a period of time have you been engaged in the active practice of law in Washington? Mr. Morgan. Since March 15, 1947. Mr. Cohn. What did you do directly prior to that time? Mr. Morgan. I was associated with the Federal Bureau of Investigation. Mr. Cohn. For how long a period of time? Mr. Morgan. March 2, I believe, 1940. Mr. Cohn. Do you know a man by the name of Russell Duke? Mr. Morgan. I do. Mr. Cohn. When did you first meet Mr. Duke? Mr. Morgan. If I may refer to some notes, please, counsel, because I tried to refresh my memory on first knowledge of this man, I would like to say at the outset, of course, that since the inquiries that have come to me from certain members of the press, I have endeavored to refresh my memory from every source I possibly could, and on the basis thereof, I am going to try this morning to certainly present to this committee, completely and fully, all the information that I have. I must say, however, that inasmuch as this goes back four and a half, almost five years, I naturally cannot remember all of the details; but I certainly will do the best I can. Mr. Cohn. I think the question was: When did you first meet Mr. Duke? Mr. Morgan. In September; September 16, 1946, to be exact. Mr. Cohn. And under what circumstances? Mr. Morgan. A very good friend of mine, of long standing, brought Mr. Duke to my office. Mr. Cohn. What was your friend's name? Mr. Morgan. Mr. Howard I. Bobbitt, an attorney of Portland, Oregon, whom I had known for years in the FBI, and who, in fact, had been agent in charge of the FBI in Portland, Oregon. Mr. Cohn. And for what purpose did Mr. Bobbitt bring Mr. Duke to your office on that occasion? Mr. Morgan. There was no ostensible purpose in bringing Mr. Duke to my office. Mr. Bobbitt came into see me, as he does every time he came to Washington. Mr. Duke was accompanying him at that time. Mr. Cohn. Had you ever heard of Mr. Duke before this meeting? Mr. Morgan. Never, to my best knowledge and belief. Mr. Cohn. Mr. Bobbitt had never mentioned him to you in any way? Mr. Morgan. To my best knowledge and belief, he had not. Mr. Cohn. And Mr. Bobbitt walked in and brought this man Duke in with him, and that is the first you ever heard of Russell Duke? Mr. Morgan. That is correct. Mr. Cohn. Can you give us the substance of the conversation at that first meeting? Mr. Morgan. Well, apart from the matter of mere social conversation, Mr. Bobbitt mentioned to me that at that time they had been in Washington along with an attorney from San Francisco in connection with a particular case, one involving a man named Thomas Guy Shafer, of Oakland, California. He stated that they had been having conferences at the Bureau of Internal Revenue with respect to the case. He advised me that Mr. Knox was the counsel for Mr. Shafer and that, in all probability, the case was going to require a great deal of additional work and that they would probably need Washington counsel in connection with it. He asked me if I would consider handling the case. I talked with them in some detail concerning their knowledge of the matter and asked them if they were in a position to retain me at that time. They said that certainly, subject to approval by Mr. Knox. Mr. Knox, to the best of my knowledge at that time, was in Washington, or at least was on his way to New York. But, in any event, Mr. Knox came by my office a short time thereafter and explained to me who Mr. Shafer was. He was a druggist in Oakland. There was a tax deficiency of a very sizable amount, approaching, on, as I remember, 400, maybe $500,000, with the penalties that were involved. And thereafter I agreed to represent Mr. Shafer and I did represent him. Mr. Cohn. What was Mr. Bobbitt's connection with the tax man, Mr. Shafer? Mr. Morgan. Mr. Bobbitt was associated as company counsel with Mr. Knox. Mr. Cohn. What was Mr. Duke's connection? Mr. Morgan. Mr. Duke's connection, there I must say it is quite vague in my mind, because I had little occasion to inquire at that particular point. As a matter of fact, I am not at all certain, this far removed, that I have any specific knowledge concerning the nature of Mr. Duke's association at that time. Now, in light of what I now know--and it is sometimes difficult to distinguish between what you then know and what you know now--Mr. Duke, it appears, was associated as a public relations counsel or an investigator or what not for Mr. Shafer, and it is my understanding, since that time I did not know it then--to the best of my knowledge, Mr. Knox had engaged Mr. Duke for that purpose. Mr. Cohn. And Mr. Duke is not a member of the bar? Mr. Morgan. Not to my knowledge. Mr. Cohn. Did you ever have any communication with Mr. Duke about the Shafer case after that first meeting? Mr. Morgan. When you say communication, do you mean written communication, or oral? Mr. Cohn. I mean written or oral, direct. Mr. Morgan. I am sure he came by my office many times. He probably inquired about it. Mr. Cohn. What was he doing in connection with this case? Mr. Morgan. Insofar as I was concerned, after I took over the active handling of the case, there was no service he was performing as far as I was concerned. Mr. Cohn. For what purpose was he in communication with you when you became counsel? Mr. Morgan. Merely an inquiry in connection with the case, as to its status and so on. Mr. Cohn. Was he representing Mr. Shafer? Mr. Morgan. He was representing Mr. Shafer. Mr. Cohn. I say did he come in and inquire in behalf of Mr. Shafer? Mr. Morgan. Not as such. It was merely an inquiry, since he had been in my office in the initial conversation concerning the case, as to how the Shafer case was coming along. Mr. Cohn. And you felt at liberty to discuss that? Mr. Morgan. I didn't see any reason why I shouldn't. Mr. Cohn. Were you authorized by Mr. Shafer or his counsel to discuss the case with Mr. Duke or to consult him in any way? Mr. Morgan. As a matter of authorization; certainly not. Mr. Knox knew Mr. Duke and had been in discussion with him, certainly about the matter. You can ask Mr. Knox. Mr. Cohn. What finally happened with the Shafer matter? Mr. Morgan. Mr. Shafer was indicted. Mr. Cohn. Did you receive a fee in connection with your services? Mr. Morgan. I did not. Mr. Cohn. You received no remuneration whatsoever? Mr. Morgan. None whatsoever. Mr. Cohn. Did Mr. Duke receive any? Mr. Morgan. I do not know and at that time I had no idea that Mr. Duke was in any way engaged, as I indicated earlier, formally in the case. I know now that Mr. Duke received funds in connection with the case, I certainly do. Mr. Cohn. You know that now? Mr. Morgan. Yes. Mr. Cohn. When did you find that out? Mr. Morgan. I found that out from newspaper reports at the time the King committee was out in California. Senator Mundt. May I inquire: why would you be discussing the case with Mr. Duke when you knew he was connected with it? Mr. Morgan. Senator, insofar as Mr. Duke was concerned, it was not a matter of discussing the case, and, as I say, I have no definite record on the matter. I am sure that somewhere along the line, after having been in the office with Mr. Bobbitt, he may have inquired of me, ``How is the Shafer case coming along,'' something like that. I would indicate to him there was nothing to report, nothing new and no developments in the matter. I saw nothing improper in that, certainly, still don't. Mr. Cohn. Did you ever have any relations with Mr. Duke concerning any other case? Mr. Morgan. Yes, I did. Mr. Cohn. How many others. Mr. Morgan. I would like to indicate specifically each one, if you would like. Mr. Cohn. Could you give us first the total and then discuss them? Mr. Morgan. Insofar as the reference of matters that I could say Mr. Duke referred a case to me, there would be two cases specifically. One was the case of Dr. Ting David Lee, a Chinese doctor in Portland, Oregon, and the other is a case involving a man named Noble Wilcoxon, of Sacramento, California. Now, after having made that observation--and if you would like any other explanation of that I will be glad to give it to you--I should say this: On November 10, 1948, Mr. Duke came to my office. He was accompanied at that time by a Mr. Conrad Hubner, introduced to me as a lawyer of San Francisco. We had a conversation generally by way of discussion of mutual acquaintances. I learned that Mr. Hubner had associated with him a man that I had known in the FBI, and at this particular meeting, Mr. Hubner discussed with me the possibility of handling the Washington end of two cases in which he was counsel. He stated that these cases were at that particular time still under consideration in San Francisco. He said he was three thousand miles away from Washington and necessarily had to have someone here because he couldn't be coming back and forth to handle the Washington end and the Washington incidents of the cases, there were two. One of those cases involved a man named Harry Blumenthal. The other involved a man named Wolcher. I have forgotten his first name. Mr. Hubner advised me that he did not know when those cases would be referred to Washington for consideration. I noted here that that visit was on November 10, and that he forwarded to me power of attorney in each of those cases on March 24, 1949. Now, I mentioned those two cases because there was an instance where Mr. Duke had referred to me an attorney--I assume he recommended me. I was very grateful for his having done so, and I assume responsibility in those cases. Mr. Cohn. Following this initial recommendation when Mr. Duke came in with Mr. Hubner, did you have any communication with Mr. Duke concerning those cases, following the initial meeting? Mr. Morgan. The Wolcher and Blumenthal Case? Mr. Cohn. Yes, the Wolcher and Blumenthal. Mr. Morgan. I may have. I recall none certainly. But I would not say I did not, because I have no recollection. If you have anything that might refresh my recollection on the matter, I would be glad to see it. Senator Mundt.  Mr. Morgan. Yes, I have. I have examined them, Senator; I received a subpoena sometime in the afternoon, I guess it was last Monday, at eight, I believe. It was a ``forthwith'' subpoena, requesting that I produce all records and so on--I don't know, maybe counsel would like to read the subpoena into the record--with respect to any correspondence of any kind with Russell Duke and any financial dealings with Russell Duke and so on. As I say, it was the ``forthwith'' subpoena. I wanted to comply with it in every way possible. We had no file on Russell Duke. That meant that to obtain any correspondence, conceivably we would have to run through virtually every file in the office, including general correspondence and that sort of thing. But I took girls off other work and made them run a check of all of our files, and at 5:30 I called the counsel of the committee, and said that insofar as I was able to I would be glad to come up and produce these records. They said that wouldn't be necessary, I could be up in the morning, and I did at 10:30 in the morning. As I said then and I certainly repeat now, I would not vouch that that is every piece of correspondence with respect to Russell Duke, I don't know. That is all we could find at the time. There may be more. Mr. Cohn. Since the time you produced those papers, have you continued to search the files to determine whether or not you did in fact fully comply with the subpoena? Mr. Morgan. Yes. We haven't made a consistent project out of it. We have been very busy in the office in the last few days. As a matter of fact, when I received the subpoena, I had a man who traveled eighteen hundred miles to confer with me on the case. I dropped it and went out on this. The best we can, we did, yes. I find no other correspondence insofar as he is concerned. Mr. Cohn. You have no other correspondence? Mr. Morgan. No other correspondence. Mr. Cohn. So following the searches you made, you now feel you have complied with the subpoena? Mr. Morgan. Insofar as I was able to, yes. Mr. Cohn. And that you produced every paper called for by the subpoena, in your possession? Mr. Morgan. Yes, sir. Mr. Cohn. What was the final determination of the Wolcher and Blumenthal cases? Mr. Morgan. Those were two separate cases. Mr. Cohn. What was the final determination of each one of them? Mr. Morgan. In the Blumenthal case--I remember that rather vividly---- I assume, Senator, that we regard this as proper to be discussing incidents of a case. I am somewhat reluctant to do it because of the relationship with the client, but I will go ahead and do it, if you like. In that particular case I conferred with the Justice Department attorney after the case had been referred to the Justice Department. Mr. Cohn. Could you give us his name, please? Mr. Morgan. I think it was Mr. John Lockley. Mr. Cohn. Was he in the tax division? Mr. Morgan. Yes. Mr. Lockley told me very frankly that they intended to prosecute Blumenthal unless he saw fit to come clean. By that he meant Blumenthal's position was that he had not received himself, on his own behalf, certain monies in certain transactions growing out of deals during the war. And Lockley stated that the Justice Department was simply not going to accept that position, that they were going to insist that he indicate who got the money, or they were going to prosecute him. I communicated that information to Mr. Hubner in San Francisco. Mr. Hubner thereafter advised me Mr. Blumenthal had stated that he had gone to jail once in connection with the incidence of that case, and that he did not intend to go again. Thereupon he made a full disclosure in the matter. That information was made available to Mr. Lockley. I don't know whether Mr. Blumenthal became a witness for the government thereafter against those individuals who received the money, or not. To the best of my recollection, the case was taken on from there. I don't know, frankly, the ultimate disposition. Mr. Cohn. Did you ever receive a fee? Mr. Morgan. Yes, I received a fee of $1,000. Mr. Cohn. Did Mr. Duke receive a fee? Mr. Morgan. I do not know. I have no knowledge in the matter. Senator Mundt. At what point in the case did you cease to be connected with him? Mr. Morgan. At such time as I had understood from conversations with Mr. Hubner that they were going to proceed locally with a further investigation of the matter, based on the additional information that Blumenthal had voluntarily supplied the Department of Justice. On the Wolcher case, I had one conference, as I remember it, perhaps two--I can't be sure of that--with Mr. Lockley. I remember the first one very vividly, because while I was talking to Mr. Lockley I received a very fateful telephone call in my life. The call was for me to consider taking the position as counsel to a certain committee of the Senate. Mr. Cohn. Which committee was that? Mr. Morgan. That was a subcommittee of the Senate Foreign Relations Committee. Mr. Cohn. Did Mr. Duke make any efforts to obtain that counselship for you? Mr. Morgan. Certainly not. I say certainly not. I don't know what Mr. Duke may have done at any particular time, but insofar as I know, he certainly did not. Mr. Cohn. Did you ever discuss that counselship with him? Mr. Morgan. Prior to assuming the counselship? Mr. Cohn. Yes. Mr. Morgan. Certainly not. I am quite positive of that. Senator Mundt. Did you afterward? Mr. Morgan. What do you mean discuss it, Senator? I don't understand what you mean. I have discussed the incidents of my association with that committee but---- Senator Mundt. Tell us what you mean by the kind of discussion that you had. Mr. Morgan. With Mr. Duke? Senator Mundt. Correct. Mr. Morgan. I don't remember any discussion, with Mr. Duke, but I certainly wouldn't say, Senator that I didn't talk with him and with hundreds of other people about my association with the committee. Senator Mundt. I wondered when you qualified the question ``prior to,'' which indicated that you had discussed it afterwards. Mr. Morgan. I made that observation because counsel's inquiry related to whether Mr. Duke had anything to do with my securing the position, and I stated that certainly not to my knowledge, in any way. And I remember excusing myself from Mr. Lockley's office at that time. I talked with those who were interested in having me take that position, and I agreed to do so. Thereafter, having become counsel to the committee, I withdrew from active consideration of cases and later on Mr. Hubner came back to Washington for a conference on the Wolcher case. He went to the Justice Department with one of my law partners. They conferred on it. Mr. Wolcher thereafter was indicted, so I understand. Mr. Cohn. Did you receive any fee? Mr. Morgan. I received a thousand dollars in connection with each of those cases, and that $1,000 was a retainer paid me at the time Mr. Hubner originally engaged me for the purpose of handling the cases at such time as they might be referred to Washington for attention. Mr. Cohn. The $1,000 was for the purpose of a retainer in case the cases got down to Washington? Mr. Morgan. Exactly. Mr. Cohn. What if the cases didn't go down to Washington? Mr. Morgan. The retainer necessarily would be returned to Mr. Hubner. Mr. Cohn. Did you ever return any retainer that you took on that basis in any tax case? Mr. Morgan. In any tax case? Mr. Cohn. Yes. Mr. Morgan. Yes, I have returned retainers. Mr. Cohn. In tax cases. You took the retainer predicated on the possibility of the case going to Washington? Mr. Morgan. Well, now, I think of one case in which a fee in escrow was returned. Mr. Cohn. What was the name of that case? Mr. Morgan. That was the Shafer case. Mr. Cohn. That is the one in connection with which you originally met Mr. Duke? Mr. Morgan. That was the one at the time Mr. Bobbitt brought Mr. Duke to my office. Mr. Cohn. I asked whether or not you had received any fee and you said no. Mr. Morgan. I didn't receive any fee. Mr. Cohn. How much was put up in escrow? Mr. Morgan. $20,000. Mr. Cohn. What was the escrow arrangement? Mr. Morgan. The escrow arrangement was simply this: I talked to Mr. Knox at the outset in the handling of the case. The matter of fee came up. Mr. Knox explained it to me this way: that Mr. Shafer had spent a great deal of money in connection with legal representation and for other purposes in an effort to get this case disposed of locally; and that he did not feel in the position to want to spend any additional money by way of a fee as such. That, of course, meant that he wanted the case to be handled on a contingency basis. I discussed with Mr. Knox fully the incidents of the matter. I looked at the size of the case insofar as dollars and cents were concerned, I looked at the ramifications of it, I looked at the financial position of the client. I set a contingency fee, explaining to Mr. Knox at that point that manifestly, in a case that was going to involve as much work as certainly I anticipated would be involved in this case, that the contingency would be appreciably higher than would be an out-and-out fee at the outset. In setting the fee additionally, I realized that I would have to send a reference fee to Mr. Bobbitt. I also contemplated that I would probably have to go to California to make inquiry and further investigation and probably engage an accountant, which I assumed that I would have to pay for in the situation. This fee was placed in escrow in the event prosecution was denied in the case. Mr. Cohn. Who was the escrow agent? Mr. Morgan. The escrow agent--there was no formal escrow agent. It was maintained in a reserve account in Riggs National Bank. I understood Mr. Knox and I had formal correspondence with respect to the arrangement. Mr. Cohn. Exactly what was the contingency involved? Mr. Morgan. Mr. Shafer did not want to be prosecuted. The contingency in the case was whether or not we could present the case to the Department of Justice that would adequately convince the department that this was a case that should not be prosecuted criminally. Mr. Cohn. The indictment was stopped or did not go forward? Mr. Morgan.  Did you return the $20,000 immediately after the filing of the indictment? Mr. Morgan. We did. I did not return it because I was not with the firm at that time, but my office did. Mr. Cohn. I think you were telling us about two other tax cases which you handled as a result of introductions by Mr. Duke, is that correct? Mr. Morgan. There are two other cases in which Mr. Duke seems to have been in the picture; and I want to relate both of them. Mr. Cohn. Will you please do so? Mr. Morgan. Yes. One case is a case involving a man named Jack Glass, of Los Angeles, California. That case came to me by reference to me from an attorney named Maurice Hendon. I might say Mr. Hendon was then and is still a very prominent lawyer. Mr. Hendon called me concerning the handling of the case. He made arrangements whereby he would come back to Washington for a conference. There Mr. Hendon paid me a fee in connection with the case, and I gave him a one-third reference fee for referring the case to me. At some stage of the picture--I don't know just exactly where, when and how, I ascertained that Mr. Duke had approached Mr. Glass in connection with this case. I am frank to say that I think my knowledge insofar as any particularity is concerned, it stems from a conference I had with Mr. deWind of the King committee, who indicated to me, I think that in this particular matter Duke had obtained some money. Mr. Cohn. Exactly when was this? When did you get into the Glass case? Mr. Morgan. Mr. Hendon, called my office on July 12, 1949, and I held a conference with Hendon here in Washington, as I remember, on July 27, 1949. Mr. Cohn. It is your testimony that in the course of the telephone conversation, in the course of the first meeting, Mr. Duke's name was not mentioned in any way? Mr. Morgan. To the best of my knowledge and belief, it was not. Now, in trying to recall something that happened that long ago--I was in Los Angeles the other day in connection with other business matters. I had a conference with Mr. Hendon in connection with something wholly unrelated to any of this sort of thing. He brought up at that time the fact that when the King committee had been on the West Coast, that he had submitted to the committee an affidavit concerning the matter. I asked him at that point: I said, ``How and when and under what circumstances, as best you can remember, did Mr. Duke enter into this picture?'' He stated to me that his reference of this case to me was by reason of some friend of mine who was a lawyer that he knew. I don't know whether it was someone that I had known in the bureau, or not. He said that Duke had approached Glass and made an arrangement with Glass over his objection. That is the best that I can do to help you on that. That is Mr. Hendon's recollection of the matter; insofar as I can recall, it is my recollection. Mr. Cohn. When did you first discover Mr. Duke's connection with this particular case? Mr. Morgan. I just couldn't recall. It is just a blank. I remember Mr. deWind speaking out. I remember talking to Mr. Hendon about it. But I don't remember any conversations with Mr. Duke about it, but that certainly wouldn't mean that there weren't any. Here is what I am trying to remember in this situation. Frankly, I draw a blank on it. When Mr. Hendon was back here in July 1949, July 27, 1949, I am, sure that if Duke were in the picture, that he must have mentioned it, we must have discussed it. But I just have no recollection on the point. Mr Cohn. Did you keep any diary entries? Mr. Morgan. No, I maintain no diary. Mr. Cohn. From what were you able to reconstruct some of these exact dates you have given us here? Mr. Morgan. From the files on each of the cases. Mr. Cohn. You mean correspondence? Mr. Morgan. Yes. I mean correspondence or memoranda in the files. Mr. Cohn. Would your memoranda in the files in the Glass case reflect whether or not Mr. Duke had been present at any of these meetings? Mr. Morgan. You mean insofar as with Mr. Hendon? Mr. Cohn. With Mr. Hendon or with anybody else in connection with the case? Mr. Morgan. I am certain, insofar as I can reconstruct the situation, counsel, that Mr. Duke was never at any conference with me and Mr. Hendon. In other words, I just have no recollection of it, and I am sure if it occurred I would have remembered it. Mr. Cohn. What was the final disposition of the Glass case? Mr. Morgan. Mr. Glass was declared non compos mentis by the court in Los Angeles. Mr. Cohn. Was that following an indictment? Mr. Morgan. No; it was prior to indictment. Mr. Glass was supposed to have a very serious heart condition, and Mr. Glass did have a heart condition, and I was advised by Mr. Hendon that his physician said that the strain in connection with the whole matter was responsible for it. I say that because that was one of the things we presented to the department as a basis for arguing that the case should not be prosecuted. Mr. Cohn. With whom in the Department of Justice did you deal in connection with the case? Mr. Morgan. As I remember, it was Colonel Victor Swearingen. Mr. Cohn. Did you receive any fee in connection with the services you rendered in the Glass case? Mr. Morgan. Yes. Mr. Cohn. How much? Mr. Morgan. I received a fee of $4,000, of which $1,500 I forwarded to Mr. Hendon as a reference fee. Mr. Cohn. Did Mr. Duke receive any compensation in connection with that case? Mr. Morgan. I have indicated to you, according to Mr. deWind that he did. Mr. Cohn. How much was it? Mr. Morgan. I don't know. Mr. Cohn. Mr. deWind mentioned no amount? Mr. Morgan. He may have. I just don't remember. Mr. Cohn. What is the next case you handled with which Mr. Duke had a connection? Mr. Morgan. This particular case, when you say Mr. Duke had a connection, I remember quite well. I have tried to remember, as best I can, the initial meeting in my office with Mr. Bobbitt. At that time Mr. Duke was discussing various cases in which he had been concerned. In other words, he was giving his background to me, more or less. He had explained that during the war he had represented various companies and organizations and that many of those were involved in difficulties. I have tried to remember some of those that he mentioned because a newspaper man the other day asked me if I remember one case, and there came back a flicker of memory on it. It relates, I think to that discussion. It is a case involving di Martini, that is. But who they were I don't know. Now, di Martini, I didn't handle the case, don't remember it. But there was one matter I do remember his mentioning when he was in my office, and that is a rather bizarre case, on the basis of what I now know about the incidence of it, involving an Inez Burns of San Francisco. Senator Mundt. Just a minute, before we get away from this. All this discussion, this string of cases, was taking place in your office, the first time you met him; is that right? Mr. Morgan. No, Senator. These cases, I will be glad to give you date by date as to when any of these cases came my way. But I want to remember this case. Senator Mundt. It is my understanding of your testimony a few minutes ago that you said Mr. Bobbitt came to your office and Mr. Duke was telling you about all these various cases. Mr. Morgan. I was trying to resurrect my knowledge of Mr. Duke and his activities, and this is the case I am about to mention. That is when I first heard of it. Mr. Cohn. It is my understanding from your testimony just a couple of minutes ago, that you were referring to this first meeting in which Mr. Bobbitt brought Mr. Duke to your office. You testified previously that the Shafer case was discussed, is that right? Mr. Morgan. That is the case that Mr. Bobbitt referred to me, yes. Mr. Cohn. And Duke came along to that meeting at which there was a reference to the case? Mr. Morgan. It was the first time I ever met the gentlemen. Mr. Cohn. Haven't you just testified that at the same meeting Mr. Duke also mentioned to you this Inez Burns case? Mr. Morgan. I am trying to give you the background in connection with the Burns matter because this is not a case in which I feel that I was in any way associated with Mr. Duke as a lawyer or anything like that. Mr. Cohn. What I am trying to get at is this: Did Mr. Duke mention this Inez Burns case to you at the first meeting between Mr. Bobbitt, Mr. Duke and yourself? Mr. Morgan. I am disposed to think he probably did, yes. Mr. Cohn. Did he mention a case involving someone named di Martini? Mr. Morgan. Yes, I think so. Mr. Cohn. Were there any other cases mentioned by Mr. Duke? Mr. Morgan. I don't remember any others. Mr. Cohn. Why did Mr. Duke, who is a public relations man, not a lawyer, bring up three tax cases in his discussion with you on that first occasion? Mr. Morgan. As I remember, there were two: the Burns matter and the di Martini case. Mr. Cohn. How about Shafer? Mr. Morgan. Mr. Bobbitt brought that case to me. Mr. Cohn. You mean Mr. Duke didn't mention it? Mr. Morgan. Mr. Duke was certainly there. But I mean in source as far as I was concerned, that is a reference from--I wouldn't say a lifelong friend but a friend of many years' standing, who is a very reputable lawyer on the West Coast. Mr. Cohn. He brought Mr. Duke with him, and Mr. Duke participated in the discussion? Mr. Morgan. There is no question about that. Mr. Cohn. Did Mr. Duke participate in the discussion, about the Shafer case? Mr. Morgan. Mr. Bobbitt led the discussion in all. Mr. Cohn. Did Mr. Duke participate? Mr. Morgan. He may have. Mr. Cohn. Don't you remember where he did, or whether he did or didn't? Mr. Morgan. Frankly, I don't. Mr. Cohn. You do remember discussing that case with Mr. Duke on subsequent occasions? Mr. Morgan. Discussing as I said before. I have no positive recollection on it, but if he inquired about the status of the case we talked about it in my office with Mr. Bobbitt, I would certainly have indicated to him what the status was. Mr. Cohn. You said you had no positive recollection of it. I thought you had previously testified quite definitely that you had a clear recollection of Mr. Duke having made inquiries as to the status of the case and having called you about the Shafer case after the first meeting. Mr. Morgan. The record will reflect that, Mr. Counsel. Mr. Cohn. What is your testimony now? Mr. Morgan. My testimony is now that I have no definite recollection of discussions with Mr. Duke concerning the Shafer case after the initial meeting, other than the fact that if he had inquired about it I would have certainly told him the status of the case. Mr. Cohn. Except for that conjecture, it is your testimony now that, according to your present recollection, you have no recollection whatsoever of having discussed the case with Mr. Duke after that first meeting? Mr. Morgan. My testimony is that I have no positive recollection one way or the other. Mr. Cohn. Were any other tax cases discussed at that first meeting. Mr. Morgan. I tried to give you the last one, and if you will let me proceed with it now, I will. Mr. Cohn. Will you give me the name of the last one, please? Senator Mundt. That still doesn't answer the question. The question was: were any other cases discussed at the first meeting? Mr. Morgan. Nothing other than the ones we have mentioned. Mr. Cohn. Burns, di Martini and Shafer? Mr. Morgan. Yes. Senator Mundt. You are sure of that? Mr. Morgan. Yes. Mr. Cohn. Now, we were talking about the Burns case. Could you tell us what was said about the Burns case by Mr. Duke to you at that first meeting? Mr. Morgan. My only recollection of that matter this far removed is the presentation to me of a rather gory story about the woman who had a large sum of money that she had secreted in the basement of her home and that the rats had eaten up the money and that it had become gummy and so forth. On the basis of that, I recall that particular phase of it. I remember that Duke indicated at that time that he had some connection with this particular individual. And, as I remember, he also had some connection with the attorney, as he so indicated. He said that he did not know what would ultimately happen with the case or what the disposition of the case might be ultimately, but that that was one of those situations in which he hoped that he might refer to me as attorney. On that occasion, that was in September 1948. I did, in December of 1950--that is two years later--by reference with Mr. Frank Ford, attorney of San Francisco, associate myself with him in this particular case. Mr. Cohn. Now, in between the original discussion with Mr. Bobbitt, Mr. Duke and yourself about the Burns case at the time you were retained in 1950, did you have any further discussions with Mr. Duke about the Burns case? Mr. Morgan. I may have. Mr. Cohn. Oral or written? Mr. Morgan. I may very well have. Mr. Cohn. Did you or didn't you? Mr. Morgan. I don't remember. Mr. Cohn. You have no recollection whatsoever? Mr. Morgan. No. Senator Mundt. Did you have any correspondence with him? Mr. Morgan. I recall no correspondence in the file. Mr. Cohn. Did you do anything in connection with the Burns case between this initial conversation in September 1948, and the time you were retained in 1950? Mr. Morgan. I may very well have. Probably to what you are referring. I received a copy of a so-called expose in the Duke matter with respect to a newspaper in San Francisco. Mr. Cohn. My question, Mr. Morgan, was---- Mr. Morgan. I am going to answer your question. Mr. Cohn. I would appreciate it if you would. Mr. Morgan. That particular newspaper account relates to a postscript attributed to a letter from me to Duke. In that particular postscript, as I remember--and I don't remember the specific wording of it--but there is some indication that a check on the Burns case does not locate it back to Washington, and a request for an indication as to who the counsel was in the case; in other words, requesting information from Duke. So, if such a piece of correspondence exists, then to that extent certainly I did. I don't have the slightest recollection of it. Mr. Cohn. Mr. Chairman, in response to the subpoena served on this witness, he produced a copy of a letter dated March 31, 1949, as addressed to Mr. Russell Duke, signed by the penned signature and added typed signature, Edward P. Morgan, on the stationery of Welch, Mott and Morgan. I would ask that that letter be received in evidence. Senator Mundt. Is that the letter with the postscript? Mr. Cohn. Yes, that is the letter with the postscript, to which this witness affixed his signature. [The letter referred to was marked as committee's Exhibit No. 3, January 16, 1953, Edward P. Morgan.] March 31, 1949. Mr. Russell Duke, 4523 Northeast Alameda, Portland 13, Oregon. Dear Russ: Pursuant to our conversation yesterday, I am enclosing herewith two photostatic copies of an editorial which may be somewhat helpful to you relative to the matter which we discussed, along with a clipping from the local Washington Times Herald. Best personal regards. Sincerely, Edward P. Morgan. Enclosures. P.S. I don't seem to be able to get a line on Inez B. at either place back here. Who is the attorney of record in her case? Can you check at S.F. to find when they referred it to D.C.? EPM. Mr. Morgan. Should I have produced the letter pursuant to the subpoena? Mr. Cohn. Yes. Mr. Morgan. That would be it, then. Mr. Cohn. May I read it ? Senator McClellan. Do you want to see the letter? Mr. Morgan. Well, I would like to see it. Mr. Cohn. After examining it, Mr. Morgan, would you read the postscript, please? Mr. Morgan. This is a letter dated March 31, 1949. Senator Mundt. Let me ask you first: is that your signature? Mr. Morgan. I don't think there is any question about it, Senator. The letter is dated March 31, 1949, on the letterhead of my office. It is addressed to Mr. Russell Duke, 45233 Northeast Alameda, Portland 31, Oregon. Mr. Cohn. Would you read the postscript, please. Mr. Morgan. ``Dear Russ''--may I read the entire letter? Senator Mundt. Surely. Mr. Morgan. Pursuant to our conversation yesterday I am enclosing herewith two photostatic copies of an editorial which may be somewhat helpful to you relative to the matter which we discussed, along with a clipping from the local Washington Times Herald. Best personal regards. Sincerely, Edward P. Morgan. It is signed ``Ed.'' Now, there is a postscript: I don't seem to be able to get a line on Inez B.---- Which would be Inez Burns, presumably. at either place back here. Who is the attorney of record in her case? Can you check at S. F. to find when they referred to D.C. It is initialed EPM. Mr. Cohn. What did you mean by either place you were unable to get a line? Mr. Morgan. That would be whether or not it would be in the Bureau of Internal Revenue or the Department of Justice. Mr. Cohn. Had you made inquiries at the Bureau of Internal Revenue and Department of Justice with reference to this case prior to being retained? Mr. Morgan. If this inquiry here was made, most assuredly it was made before I was formally retained in December of 1950. Mr. Cohn. Do you have any doubts that such an inquiry was made? Mr. Morgan. I would say that it must have been made. And having been made and looking at this now, to the best of my recollection, I think I could give you the situation, if you would like to have it. Mr. Cohn. First may I ask you this, Mr. Morgan: Whom did you contact in the Justice Department and with whom were you in contact in the Bureau of Internal Revenue? Mr. Morgan. The contacts with the Justice Department is with the clerk handling the cases over there. No power of attorney is required or as required in the Department of Justice. Mr. Cohn. I was just trying to get the name. Mr. Morgan. Somebody who handles the records. It would be some girl. Mr. Cohn. How about the Bureau of Internal Revenue? Mr. Morgan. The Bureau of Internal Revenue--and the reason I think I might remember this is the fact that I believe it is the first time that I realized, as a practical matter, that you had to have a power of attorney in order to ascertain whether a case was pending in the Bureau of Internal Revenue. I had known, of course, that you had to have a power of attorney in order to represent a client before the Bureau of Internal Revenue. But in this particular instance, I am sure, by reason of an inquiry as to the attorney of record, that we were advised that they could supply no information concerning the matter. Now, I have no background recollection on that other than just what I have said. Senator Mundt. Do you recall the purpose of the editorial? Mr. Morgan. Senator, I don't have the slightest idea. The note here ``Please return the news clipping,'' it is the only one I had. I don't know what it related to. I have no idea. That was March 1949. Senator Mundt. It is a matter of some importance, because the letter indicated the day before you had called Mr. Duke by long distance and talked with him about it. Mr. Morgan. Whether I called Mr. Duke or Mr. Duke called me, I don't know. I would say this: Mr. Duke was very prolific in his telephone calls. I think if you were to check his records, you would find that he made calls all over the country, and he called many, many times, Senator, there is no question about that, about many different things. Senator Mundt. You mean he called you? Mr. Morgan. Yes. When I wasn't there he called one of my partners. He called me at home at night, all hours of the night. So there is no question about that, sure, he called me many times. I would imagine he called me. But I couldn't be sure of that, I don't know. Mr. Cohn. What was the next step in the Burns case? Did you hear back from Mr. Duke as to the name of the attorney of record and when it was referred from San Francisco to the District of Columbia? Mr. Morgan. To the best of my knowledge, I didn't. To the best of my knowledge, that is the last I can recall of it, and I don't think the file enlightens me any. Mr. Cohn. Until the time you were retained in 1950? Mr. Morgan. By Mr. Ford. Mr. Cohn. You have no recollection having done anything in connection with the Burns case between March 31, 1949, the date of this letter, and the date on which you were formally retained by Mr. Ford? Mr. Morgan. I have no recollection of having done anything, and my opinion is that I did nothing. Mr. Cohn. Did you discuss it with Mr. Duke between those dates? Mr. Morgan. I have no recollection of it. Mr. Cohn. Did you discuss it with Mr. Duke between the period of time that you were formally retained? Mr. Morgan. To the best of my knowledge, I did not, but I cannot be sure of that. Mr. Cohn. What was the ultimate disposition of the Burns case? Mr. Morgan. She was indicted. Mr. Cohn. Did you receive any fee in connection with the Burns case? Mr. Morgan. Yes, I did. Mr. Cohn. How much? Mr. Morgan. I think I received a fee in the neighborhood-- and this was paid me by Mr. Ford, the attorney--in the neighborhood of something over $2,000, as I remember. Mr. Cohn. Did Mr. Duke receive any compensation in connection with that case? Mr. Morgan. Not to my knowledge. On that I feel reasonably certain, although on that I can't be sure, because at the time I talked with Mr. DeWind he discussed many situations in which Mr. Duke might have been involved, some of which I had never heard of. He may have advised me, but I just have no recollection. Senator Mundt. How did he make out? With all these long discussions by long distance calls--never seemed to get a fee. Mr. Morgan. Senator, you will have to talk to Mr. Duke about that, I can't help it. Mr. Cohn. Are there any other tax cases concerning which you had any dealings with Mr. Duke? Mr. Morgan. To the best of my knowledge and belief, there are no others. Mr. Cohn. Did you mention a case involving a Dr. Lee? Mr. Morgan. Yes. Mr. Cohn. Tell us about that. What connection did Mr. Duke have with that case? Mr. Morgan. The records of that office indicated that in March of 1949, Mr. Duke called the office to indicate that a Chinese Doctor named Ting David Lee had had a jeopardy assessment levied in his case and that the situation involved moneys received by Dr. Lee by way of inheritance from the Lee family in China. He asked me if I would undertake to try to help him. He said he had been trying to help Dr. Lee out there as best he could in connection with the matter, and the man was strapped, he had buildings downtown, it was perfect security for the obligation owed the government, and that he felt that the jeopardy assessment was unjust. I told him that I would be glad to help him and in a way that I properly could. Then thereafter I wrote him, as I remember, indicating that---- Senator Mundt. By ``him,'' do you mean Lee or Duke? Mr. Morgan. To Duke, after he had called me--indicating that I felt they should supply more information to me in order that I could make an appraisal of the situation and to see in what manner and to what extent we might be of assistance. The next thing I knew, Mr. Duke appeared in Washington with Dr. Lee, came to my office. I met Dr. Lee. He impressed me as a very sincere type individual, and Mr. Duke was obviously his agent, there is no question about that. As a matter of fact, in view of Dr. Lee's complete lack of acquaintance with any phase of tax matters, he certainly needed some help.  He had the jeopardy assessment, he even had to borrow money to get back to Washington he said, in connection with the case. He wanted to know if I could do anything in connection with it. I said ``Well, I don't know what we could do.'' We went over to the Bureau of Internal Revenue, and I would like to say at this point that, to my knowledge, I didn't know one single person over there, that is, to the best of my recollection. We went first to the---- Senator Mundt. What do you mean by ``we'' now, the three of you? Mr. Morgan. The three. I had no doubts about Mr. Duke, I thought he was perfectly legitimate. I took him right along. We first went to the technical staff. We talked there-- well, I don't remember with whom we talked, but it must have been some official there--about the case. He explained to me that they felt that they could not grant a conference prior to the filing of a petition in the tax court; that was the normal procedure and they felt that they didn't want to depart from it in this case. We next went down on the collector's office to find out if there was any possibility of lifting the jeopardy assessment upon a showing of tangible assets in this country that would adequately protect the government. Dr. Lee explained everything he had. Senator Mundt. To whom did you talk there? Mr. Morgan. I don't remember his name, Senator. It was some subordinate we talked to, anyway. I had made no appointment with anybody. We just walked in cold. As a result of that, nothing was accomplished. They felt we could do nothing. They felt the matter of protecting the revenues was the responsibility of the local collector. So we went back to the office and Mr. Lee asked me what had to be done in the situation. I explained to him there was one thing that could be done. That was to file a petition in the tax court and then request an early hearing before the technical staff, in the hopes that you could have the matter resolved and get the jeopardy assessment lifted. He asked me if I would undertake to represent him in connection with the matter, and I agreed to do so. Mr. Cohn. Did you thereafter represent him? Mr. Morgan. I did. Mr. Cohn. What was the final determination in that case? Mr. Morgan. The final determination of the case was a set limit through the technical staff. Mr. Cohn. In other words, you went ahead and filed the petition, is that right? Mr. Morgan. That is right, a petition was filed in Washington, with the tax court. I requested the head of the technical staff on the West Coast for a conference. He set a conference date. Mr. Cohn. Could you give us his name? Mr. Morgan. I think it is Mr. Harlacker, as I remember. He set a date for it. I flew to Portland, a period before the technical staff, presented such evidence as Dr. Lee was in a position to present, demonstrating that he had received these moneys from China as a part of the Lee estate, that it was not income subject to income tax. Thereafter I outlined for him additional information which should be presented to support his case based on inquiries made at the conference. I returned to Washington thereafter. From time to time I understand Dr. Lee was able to find record evidence of the receipt of moneys from China, which he presented to the technical staff. On the basis thereafter, the case was ultimately compromised. Mr. Cohn. Did the compromise take place out west? Mr. Morgan. The first knowledge that I had of the compromise was, as I had the power of attorney, and of course it was my responsibility to agree to the compromise, and the proposed compromise was referred to me for acceptance. I sent it to Dr. Lee. I outlined the considerations in his case. I recommended that he accept it. Mr. Cohn. How much was the original jeopardy assessment? Mr. Morgan. The jeopardy assessment, as I remember it involved something like $100,000. Mr. Cohn. For how much was it settled. Mr. Morgan. It was settled for something over $6,000, with interest. I think there was an interest item that may be brought it up over seven. I can't give you exact figures, without checking on it. Mr. Cohn. Did you do anything in Washington in the Internal Revenue Bureau to obtain an approval of the settlement down there? Mr. Morgan. To the best of my knowledge and belief on this case, I did not. Mr. Cohn. In other words, your own contact with the Bureau of Internal Revenue was your original visit when you were accompanied by Duke and the tax man. Mr. Morgan. And the appearance of the technical staff. Mr. Cohn. That was out west, wasn't it? Mr. Morgan. Yes. Mr. Cohn. I was talking about Washington. Mr. Morgan. In Washington, to the best of my knowledge and belief, that is all. Mr. Cohn. And you had no communication, direct or indirect, with anyone in the Bureau of Internal Revenue in Washington in this case, following the original meeting; is that right? Mr. Morgan. Right. Mr. Cohn. How many times were you out west conferring with the technical staff in connection with the matter? Mr. Morgan. One time. Mr. Cohn. Did you receive a fee in this case? Mr. Morgan. Yes, I did. Mr. Cohn. How much. Mr. Morgan. It was a contingent fee. Dr. Lee explained to me that he didn't have any money, that all his funds were tied up. He asked me if I would undertake to represent him on a contingency basis, the contingency being whether or not he ever got any money so he could pay me. I agreed to do so. He set a contingency fee of $4,000 in the case. I flew out to Portland, flew back. I had certain expenses while I was there. As I remember, I was there about three days. I made about three speeches in the state while I was there. I don't remember whether they were scheduled before, or after I knew I was going. When I got back, I communicated with Dr. Lee, explaining to him--I think maybe I communicated with Russell Duke--explaining to him that I did not feel that our contingency arrangement would relate to the actual out-of-pocket expenses incurred on the trip. Thereafter--I have forgotten the exact date--he sent me a check covering the out-of-pocket expenses which would total something around $400, as I remember. Thereafter the case was settled, the jeopardy assessment was lifted. Dr. Lee paid our office the balance, and he deducted, as I remember the expenses from the original fee and got something around $3,450, something like that. Mr. Cohn. Can you tell us the total amount of money you received by you from Dr. Lee? Mr. Morgan. Yes. I received $3,450 and expenses of $450. I might say, Mr. Counsel, knowing what I know now about the practice of law, I never would take a case of this kind for a fee that low if it were on a contingent basis. Mr. Cohn. Did Mr. Duke receive any compensation? Mr. Morgan. I now know that Mr. Duke received very substantial compensation in connection with the matter. I understand that Mr. Duke received in the neighborhood of maybe as much as eight or nine thousand dollars. If I might just add, gentlemen, I can assure you that I would not be handling the case for $4,000 contingent fee if I had known Mr. Duke was getting $8,000 or $9,000. Mr. Cohn. And the amount the taxpayer paid out to you and Mr. Duke was about twice as much the amount the government got, as a result of the settlement, is that right? Mr. Morgan. I think those facts are self evident. Mr. Cohn. Is there any other tax case---- Senator Mundt. Let me ask you first: Did you get your payment from Mr. Duke, or Mr. Lee? Mr. Morgan. From Dr. Lee. Senator Mundt. Yes, Dr. Lee. The check was made payable to the law office, Senator. I was out of town, Senator, as I remember, at the time. In other words, I was not available, and Dr. Lee communicated with the office saying that Mr. Duke wanted the money paid to him, and one of my partners wired out there that money was due to Welch, Mott and Morgan and the check should be made payable to Welch, Mott, and Morgan. So it was payable to the firm. Senator Mundt. The money the firm received came from Dr. Lee in a check signed by him? Mr. Morgan. Right. Senator Mundt. You received no money from Mr. Duke? Mr. Morgan. As a matter of fact, I didn't see the check, but I am sure it must have been from Dr. Lee, because the correspondence indicates that he had forwarded the check. I am sure it was not Mr. Duke. Of that I am confident. Senator Mundt. You are sure you received no money from Mr. Duke? Mr. Morgan. No, sir. Mr. Cohn. Is there any other tax case in which you had dealings with Mr. Duke? Mr. Morgan. To the best of my knowledge and belief, no. Mr. Cohn. Getting back to this Lee case for one minute, in what capacity was Mr. Duke acting for Dr. Lee? Mr. Morgan. He was acting as agent of Dr. Lee, as I understood it. Mr. Cohn. Mr. Duke was not a lawyer or certified public accountant, was he? Mr. Morgan. No, he was not. Mr. Cohn. He was a public relations man? Mr. Morgan. I understood from Mr. Duke's discussion that he handled public relations matters for clients, that he conducted investigations for them and that sort of thing. It was in that capacity that he was engaged by Dr. Lee. I might say for your record that he was engaged by Dr. Lee and not by me, and that I never had any discussions concerning it with the view to having Dr. Lee engage me, if that is what you want to know; none whatsoever. Mr. Cohn. Have you ever had any financial transactions direct or indirect, with anybody connected with the tax division of the Department of Justice? Mr. Morgan. Now, what kind of question is that? What do you mean; financial transactions direct or indirect with anybody in the Department of Justice? Mr. Cohn. Is there something that isn't clear about the question? Mr. Morgan. No, I don't understand it. What do you mean financial transaction? Do you mean did I ever in any way lend anybody money or anything like that? Mr. Cohn. Yes. Mr. Morgan. Or pay them anything? Mr. Cohn. That is right. Mr. Morgan. The answer is, no, not of any kind. Senator Mundt. Did you cash any checks? Mr. Morgan. No. For anyone in the Department of Justice? Senator Mundt. Yes. Mr. Morgan. Certainly not. On that score I can be almost positive. I have no recollection of it. Senator Mundt. What kind of financial transactions are you trying to rule out? Mr. Morgan. I was merely saying, for heaven's sake, if somebody over there along the line wanted to borrow ten bucks from me or something like that--no one did, Senator, but I lend people money right and left. Senator Mundt. You can say categorically you have had no transactions, of any kind? Mr. Morgan. I am confident of that. Mr. Cohn. And would you make the same answer with the Bureau of Internal Revenue? Mr. Morgan. Yes. Mr. Cohn. And how about Mr. Russell Duke? Mr. Morgan. I have had no transactions with Mr. Russell Duke apart from one matter, which I brought to the attention of Mr. Flanagan and Mr. Collier when I brought the papers up here. Mr. Cohn. Will you bring that to the attention of the committee. Mr. Morgan. I certainly will. On June 22, 1949, Mr. Duke came to my office, he appeared to be as near down and out as I have ever seen him. He also put out a very bold front. Mr. Cohn. What was the date again? Mr. Morgan. July 22, 1949, as I remember it. He said that his boy was seriously ill, that his wife had to go to a hospital, that he had a hotel in Washington, that he was flat broke and that he had no way to get back to Portland, Oregon. As a matter of fact, he broke down and cried in the office. I said, ``Russell, what can I do for you?'' He said, ``I want to borrow some money.'' I said, ``How much do you feel that would be necessary for you to take care of your problem?'' He said ``I would like to have five hundred dollars.'' Well, I didn't have $500 myself certainly to lend him. I discussed it with my partners as to whether or not we felt that we should, in the circumstances, lend the money to him. He said he would pay it back when he got back to Portland. We decided to do it. We wrote a check payable to him, drawn on our firm account. He said he would like to have the cash. I had him endorse it, one of the secretaries went over to the bank and got the cash and gave it to him. That was entered as a loan to Russell Duke on our original check stub on July 22, 1949.  Did he ever repay that $500? Mr. Morgan. He did not, and I asked him about it on a couple of occasions thereafter. Mr. Cohn. When did you last ask him about it? Mr. Morgan. I think the last time I asked him about it, if I can remember--well, I couldn't recall the specific date because he was flitting in and out of Washington so much I don't remember exactly. Mr. Cohn. Can you approximate the date for us? Mr. Morgan. I couldn't give you any definite date. It might have been late 1950, something like that. I know he got a very serious injury in a mine explosion and he called me from the hospital bed to tell me he was in bad shape and had to have plastic surgery and that kind of thing. I didn't have the heart to ask him them, so I remember that was 1951. So it must have been sometime in late 1950. Senator Mundt. When was the last you saw Mr. Duke? Mr. Morgan. I would say, Senator--and this is hard to remember--but I would say the last time I probably saw him was in maybe May of 1951. Senator Mundt. When did you last talk to him on the telephone? Mr. Morgan. I think the last time I talked with him on the telephone, as I remember, was when he called me from the hospital after the explosion had wrecked him pretty much. He indicated he was in rough shape, and wanted me to know how he was getting along. I was also nice to him, kind to him. As a matter of fact, let us put it straight on the record. I was a young lawyer and I was grateful to Mr. Duke. I am still grateful to him. I have nothing mean to say about that man. He was kind to me and I appreciated this. And every one of these cases was handled legitimately on the merits of any cases that ever were. Senator Mundt. That last telephone call in 1951 was a hospital bed call, was it? Mr. Morgan. Senator, I just can't remember, I am sure if I checked my record of telephone calls---- Senator Mundt. Was it earlier, or later. Mr. Morgan. I can't remember. It might have been later. I just don't remember when the mine explosion was. Senator Mundt. It was 1952. Have you any correspondence with him since 1952? Mr. Morgan. That I can't remember. Senator Mundt.  You were an old FBI agent so you did a pretty careful job? Mr. Morgan. That is right. That is one of the very embarrassing aspects of the whole thing, there is no question about that. I hope none of you gentlemen are ever comparably victims, but unfortunately, my foresight is not as good as some people's hindsight. My law office is open, my door is open, anybody can come in at any time. Here came a man to my office with one of the most highly respected men I know even today. I took him for face value, for what he was. I went out to Portland Oregon, to handle the hearing in his Lee matter. I met his wife and I met this man's children, and I was in his home. He lived in a respectable part of Portland. I made three speeches in Oregon, two at the Montriomah Hotel. The best people in the city were there. He seemed to know them all well by their first names. He belonged to nice clubs, he took me to the club for dinner. I had every reason in the world to believe he was a legitimate individual. Insofar as inquiring into the man's background, I wish now I could conduct a complete FBI investigation on everybody that walks in my office, but I imagine if I had to do that I wouldn't practice too much law. Senator Mundt. Why do you wish you had done it now? What did you discover subsequently? Mr. Morgan. Senator, I am sure you are not so naive as not to realize what this sort of thing does to a professional man. I mean you can appreciate it by realizing, if you have a good and fine clientele, what this sort of thing does. Senator Mundt. Have you subsequently discovered things in Mr. Duke's record that you wish you had known about earlier? Mr. Morgan. I understand Mr. Duke has a criminal record, I understand that he sought to take his own life. I understand that he had a terrific fight in which he threw his wife down the stairs and she divorced him. I understand he was indicted for perjury and running up and down the West Coast trying to sell some fantastic story for $30,000 or $500,000, or what anybody would give him, drunk as the lord. I know all that, and that is what I am talking about. Certainly I wished I had known that. Senator Mundt. When did you learn about that? Mr. Morgan. Insofar as the later matters that are discussed, I didn't learn about that until relatively recently. I knew that he was indicted by reason of a newspaper account that appeared in the local paper about a year ago, I guess it was. And I know that he sought to take his own life because the same account treated of that. I think the matter of his domestic difficulties was also related in a clipping that I have, as I remember. Senator Mundt. Is it a recent clipping, or how long ago? Mr. Morgan. It was a year ago, in connection with the time of his indictment. There was a story in connection with it then. Insofar as having the record is concerned, I think that that goes back to late 1950, as I remember, or late 1949 perhaps. I remember asking him about it. He was in the office and I said ``Russell, have you ever been arrested?'' He was evasive for a moment and then he said ``Yes, Yes, I was.'' He said ``I would like to tell you the story.'' And he related the entire story. He said that when he was a young man, just out of the navy, he was hitchhiking across the country. He was picked up, he said, as he told me, by a driver of a car, and the police stopped them. He said that he was a confused young man and that they arrested both of them for some kind of robbery. As I remember it, and he said he was a young, confused ``punk,'' as he put it, didn't understand what the situation was, didn't know how to defend himself, and he went to the penitentiary in the state of Iowa. He told me of course, all the details about it, which I don't remember. He said when Governor Gillette, now Senator Gillette--at the time he was governor--ultimately obtained the facts, pardoned him. That was the story. He presented that phase of it to me. Senator Mundt. Did you ever ask Mr. Bobbitt, who was an old-time friend and colleague of yours how come he didn't give you the background of this man he brought to your office at that time? Mr. Morgan. Well, I don't recall instances in which I have had an opportunity to chat with Mr. Bobbitt about it since the time that I knew these things, certainly. I am sure that Mr. Bobbitt didn't know it. Senator Mundt. I thought you FBI agents have a habit of looking pretty carefully into records of people. Mr. Morgan. Perhaps we are given too much credit, Senator. Mr. Cohn. Tell me about this $500 loan which has never been repaid. Have you ever treated that in any way on your income tax return? Mr. Morgan. No, I haven't. I think he will pay me if he gets it. Mr. Cohn. You have not charged him for it? Mr. Morgan. No. And I wouldn't push anybody. He has had his troubles. I am not going to condemn him. You people pass judgment on him, me or anybody else. Mr. Cohn. My only question was how you treated it on the income tax return. Mr. Morgan. Yes, I know. Mr. Cohn. Now, you mentioned the names of two people in the Department of Justice, Mr. Lockley, is that correct? Mr. Morgan. That is correct. Mr. Cohn. John Lockley? Is he the man with whom you had conferences with two of these cases? Mr. Morgan. Yes. Mr. Cohn. Had you known Mr. Lockley before you went to him in connection with these cases? Mr. Morgan. Mr. Lockley was a classmate of mine at Georgetown. Mr. Cohn. Had you known him following your graduation from Georgetown? Mr. Morgan. I could almost say this positively, but you can never be sure, I don't think I saw Mr. Lockley from the day I graduated from Georgetown in 1949, to the day I held a conference with him on the Blumenthal case. I have no recollection of seeing him in the meantime. Mr. Cohn. There was another name you mentioned; Colonel Swearingen. Mr. Morgan. Yes, Colonel Swearingen. Mr. Cohn. Had you known him prior to this conference on the tax case? Mr. Morgan. No. Mr. Cohn. You had never met him before? Mr. Morgan. No. Mr. Cohn. Have you seen him since? Mr. Morgan. Yes, I have seen him since. Mr. Cohn. You have seen him since? Mr. Morgan. Yes. I spoke at his church. He invited me to come out and speak to his class.  M