Braniff Airways hired a Voice of America announcer to promote the airline while the government worker was on a trip to South America.
Top executives of Minnesota Mining & Manufacturing Co. (3M Co.) invoked their Fifth Amendment rights when called to testify before the Securities and Exchange Commission on that company's alleged slush fund for political donations.
And American Airlines, Inc., revealed that its corporate payments program dated back to the mid-1930s. (See separate story, Page E1.)
These were among the revelations yesterday as reporters opened up more than a dozen boxes of documents on nine companies at the Securities and Exchange Commission.
Responding to Freedom of Information Act requests from two newspapers, The Wall Street Journal and The Washington Post, the SEC made public some transcripts of agency testimony and other documents previously kept secret in the agency's 2-year old drive to expose questionable payments at home and abroad by publicly owned corporations.
Braniff's employment of a Voice of America employee was alleged by airline Senior Vice President Charles S. South. He testified that Jose P. del Rio, a VOA speaker and announcer," was "used . . . in various ways."
For example, South said, the VOA announcer took a South American tour on his own time in 1971. "The purpose of this was to interview officials in various Latin American countries on a number of matters. In the course of the interviews he was to benefit Braniff and to mention services of the company," South said.
The interviews, he added, were to be broadcast by the Voice of South America. He gave no futher details.
A spokesman for the Voice of America, U.S. Information Agency official Alan Carter, said yesterday that the government will look into the Braniff Allegations regarding Del Rio, currently an on-air personality here in the Latin American Division.
However, Carter emphasized, it is not a violation of government ethical codes for an employee to have "outside contracts." He also said the VOA destroys all scripts after six months and all tapes after two years, making it difficult to review Del Rio's work in the early 1970s. Del Rio could not be contacted, and the USIA official said he had not heart of the Voice of South America.
South also testified that other airlines were engaged in questionable payments in Latin America and that Braniff officials believed they had to do something to capture business.
"We were in an ambience of very dirty markets. We were the only clean carrier. We are not holier-than-thous, but that was a fact . . . We saw othering business from us, especially group business . . . It was our conclusion . . that if we engaged in the same practices, this would soon put a stop to the smaller carriers' engaging in them. It is a question of pressure economics," he told the SEC.
The Remington Arms case involved still unidentified country. E. 1. dupont de Nemours & Co., which owns Remington, told the SEC that the customs inspector involved threatened to charge not only a larger duty but a penalty if the $18,000 bride were not paid.
Testimony released in the 3M Co. case showed that top officials, including Bert S. Cross, chairman from 1966 to 1970, and former Vice President for Finance Irwin R. Hansen, pleaded their Fifth Amendment rights against self-incrimination when asked by the SEC about 3M political contributions.
In general, the documents released yesterday showed that top corporate officers at most of the firms involved knew that a pattern of domestic political contributions or overseas bribery existed in past years. Testiony of various company officers said such payments were necessary because competitors followed the same practices.
Much of the material, however, was part of previous court settlements and already on the public record. In all of the closed cases, companies and key individuals have consented to settlements without admitting or denying the SEC allegations.
The file contained numerous delletions of names, places and facts. An SEC spokesman said omissions concerned current investigations and privacy or trade secrets that would be endangered by disclosure, deletions permitted under the Freedom of Information Act.
Phillips Petroleum Co., which allegedly diverted $2.8 million of corporate funds to two Swiss accounts and then returned some of the money to the United States for illegal campaign contributions, is under criminal investigation. As a result, transcripts of testimony by Phillips directors were missing from that company's file.
In other documents Harding L. LAWRENCE, CHAIRMAN OF Braniff Airways, Inc., described some of the details surrounding his firm's illegal $40,000 contribution in 1972 to President Nixon's re-election campaign.
He was approached by Nixon's chief fund-raiser, Maurice H. Stans. Lawrence was asked by the SEC attorney ifStans indicated how much money he wanted.
"No, but he did talk in terms of 1 per cent of net worth, or a matter of $100,000," Lawrence answered.
Another excutive testified that $40,000 in cash delivered to Stans was loaned by Chase Manhattan Bank in Panama to a company called Cam Fab, owned by Braniff's regional vive president based there.
Braniff repaid Cam Fab with cash raised from the sale of airline tickets that were never recorded on the company's books.
Lawrence and the company pleaded guilty and paid fines in 1974 for making the illegal contribution.
Previously, the SEC permitted most companies to prohibit public dissemination of the names of payment recipients or their countries when settlements of various cases were reached. With the release of additional / documents, these names are being disclosed in some instances.
For example, Butler National Corp., a small navigational equipment manufacturer based in Lenaxa, Kan., was accused last June of paying $102,500 in 1975 to an unnamed foreign agent in order to sell equipment worth only $317,700.
The files yesterday showed the country was Mexico and the agent there was Roberto Kobeh Gonzalez of Electronica Asociada IRMO S. A. A letter from Butler's attorney to the SEC notes that the agent "is also employed as a pilot and engineer with the agency of the Mexican government, which effected purchases of navigational equipment from Butler.
The Butler attorney's letter says that Fausto C. Miranda, a Mexico City attorney hired by Butler, predicted that if Mexico was named in the SEC complaint, "this information would feed back to Mexico, and assuredly for the sake of appearances Mexico would terminate Butler as a supplier."
The Mexican sale was important to Butler. It amounted to 15 per cent of Butler's total revenues for the year that ended April 30, 1975, and the commission was 65 per cent of its pre-tax income that year.
Reached yesterday by phone, Gary A. Johnson, treasurer of Butler National, said the company still expects a reaction from the Mexican government now that it has been named.
He said that the lidgation had cost Butler between $60,000 and $100,000. "Stanley Sporkin (SEC enforcement chief) and his investigators treated us like a Lockheed or a United Brands," he complained.
The none corporations mentionen in the SEC documents yesterday were American Airlines, American Ship Building Co., Ashland Oil Inc., Braniff. Butler, De Pont. 3 M Phillips Petroleum Co., and Waste Management, Inc., of Hinsdale 111.
