ACTIVITIES OF THE SECURITIES AND EXCHANGE COMMISSION AND THE POST OFFICE DEPARTMENT IN FLORIDA FRIDAY, FEBRUARY 15, 1946 UNITED STATES SENATE, SUBCOMMITTEE OF THE COMMITTEE ON THE JUDICIARY, Jacksonville, Fla. The subcommittee met, pursuant to call at 9:30 a. m., Friday, February 15, 1946, in courtroom No. 2, at Jacksonville, Fla. Present: Senator Pat McCarran (chairman) and Senator James O. Eastland. Also present: J. G. Sourwine, counsel to the committee. The CHAIRMAN. The subcommittee will come to order. This subcommittee sits here today pursuant to Senate Resolution No. 35 of the Seventy-ninth Congress, together with Senate Resolution No. 112 extending Senate Resolution No. 35 and Senate Resolution 194 extending the time of Senate Resolution No. 35. The resolutions are as follows: [S. Res. 35, 79th Cong., 1st sess.] RESOLUTION Resolved, That the Senate Committee on the Judiciary or any duly authorized subcommittee thereof, is authorized and directed to make a full and complete study and investigation of the activities of the Securities and Exchange Commission and Post Office Department, or any representative thereof, with a view of determining whether (a) the activities of said agencies, through their representatives, are crippling, hampering, or rendering ineffective the Municipal Bankruptcy Act, as amended, heretofore enacted by Congress; and (b) whether or not the activities of said agencies, through their representatives, are unfairly resulting in undermining the credit of the taxing units of the State of Florida. The committee shall report to the Senate as soon as practicable and not later than April 2, 1945, the result of its study and investigation, together with its recommendations. For the purpose of this resolution the committee, or any duly authorized subcommittee thereof, is authorized to hold such hearings, to sit and act at such times and places during the sessions, recesses, and adjourned periods of the Seventy-ninth Congress until April 2, 1945, to employ such clerical and other assistants, to require by subpena or otherwise the attendance of such witnesses and the production of such correspondence, books, papers, and documents, and make such investigations, to administer such oaths, to take such testimony, and to incur such expenditures as it deems advisable. The committee is authorized to utilize the services, information, facilities, and personnel of the departments and agencies of the Government. The expenses of the committee, which shall not exceed $1,000. shall be paid from the contingent fund of the Senate upon vouchers approved by the chairman of the committee. 1 [S. Res. 112, 79th Cong., 1st sess.] Resolved, That the authority conferred by S. Res. 35, Seventy-ninth Congress, agreed to February 26, 1945 (relating to an investigation of the Securities and Exchange Commission and the Post Office Department), is hereby continued during the sessions, recesses, and adjourned periods of the Seventy-ninth Congress until December 31, 1945; and that the limit of expenditures under such resolution is hereby increased by $2,500. [S. Res. 194, 79th Cong., 1st sess.] Resolved, That the authority conferred by S. Res. 35, Seventy-ninth Congress, agreed to February 26, 1945, as extended by S. Res. 112, Seventy-ninth Congress, agreed to May 3, 1945 (relating to an investigation of the Securities and Exchange Commission and the Post Office Department), is hereby continued during the sessions, recesses, and adjourned periods of the Seventy-ninth Congress. The CHAIRMAN. At this time we will insert in the record the report of the Committee on the Judiciary, of the Senate of Florida, reporting the resolution to the Senate of Florida. (Said report of the committee is herewith incorporated, being in words and figures following:) To the Senate of Florida: REPORT OF COMMITTEE Your committee, of which the undersigned was chairman and vice chairman, respectively, appointed under authority of Senate resolutions numbered 2 and 8, respectively, adopted at the 1943 session of the legislature, which said resolutions, among other things, provided that: "Whereas sound principles of State government in a world at war direct rigid adherence to economy in the administration of the government of the State of Florida, to the end that the taxpayers of Florida shall be unencumbered with unnecessary State taxation, thus liberating their resources and better enabling them to bear their part of the burden of this world war program" beg to make the following report: Shortly after the adjournment of the 1943 session of the Florida Legislature, your committee received many urgent and pressing appeals from outstanding local officials and citizens of Key West and Monroe County, urging your committee to investigate the bond refunding situation and conditions in that community, and representing to your committee that they were being hampered and prevented from carrying out voluntary refunding agreements on account of arbitrary and illegal interference of certain State officials, and that said interference, if persisted in, would result in enormous and unjustified additional burden placed upon the taxpayers of said community. Your chairman, after deliberate consideration of said appeals, as well as of said resolutions, and after consulting with other members of the committee, concluded that it was the duty of your committee to conduct a hearing, as a fact-finding body, to the end of rendering whatever relief to the taxpayers lay within their power. Your chairman appointed a subcommittee to conduct this hearing, composed of Senator Beacham, as chairman, and Senators Franklin and Baker. Monroe County and Key West, of course, are located within the senatorial district of Senator Franklin. The subcommittee proceeded to Key West and conducted hearings into the subject matter, and we file as a part of this report, copy of the testimony taken down and transcribed by an official court reporter, which was introduced before said committee. It will be noted that the committee requested the presence of the members of the House committee appointed in 1941 with authority to conduct similar investigations, as well as Walter P. Fuller of St. Petersburg, Fla., who was investigator for said committee; and it will be further noted from said testimony that none of said persons appeared |