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About Medford mail tribune. (Medford, Or.) 1909-1989 | View Entire Issue (Oct. 23, 1963)
I MEDFORD MAIL THIBUNE. MI&ftttD, OREGON Dillon, Family Have $3 Million Riding On Tax Controversy WASHINGTON (UPI)-Treas-; a former subsidiary. This was ury Secretary Douglas Dillon I accomplished by distribution of and members of his family j portfolio holdings. A company have about $3 million riding on j spokesman said today the IRS a tax case under continued ' first approved this but later re study by the International Rev-1 opened the question and even enue Service, an arm of the ! tuallv took the Dosition the dis- MEDNESD.W, OCTOBER 23, 1963 Treasury Department A spokesman for Dillon said that the secretary has taken every precaution to make cer tain that no conflict of interest arises in this or any other tax case. An IRS spokesman de clined to comment on the case. As one of his first acts in of fice, Dillon directed that no tax tribution amounted to a sale and therefore was subject to added tax on realized capital gains. The company spokesman said debate on this had gone on for several years but first wis for malized by IRS on Jan. 19. i9:il. This was a few davs after "un ion's confirmation hearings and SMITING MASTERED Cathy Landry, 7, of Watertown, Mass., who had her right leg removed after doctors discovered it to be cancerous, is getting along fine. Here Cathy demonstrates how she has mastered rope skipping. (UPI) Great to give, grand to gel! BIG BEN BABY BEN GIVE THE WORLD'S MOST POPULAR ALARM CLOCKS! Botli Big anil Baby Ben hae adjustable louil-sotl alarm, quiet tick (or restful bleep, dependable performance to wake you for sure. Make great gifts. From onlv s78Pi WE STCLOX James B. Donovan Tells About 'k On the anniversary of the harrowing Cuban blockade crises, Bill Surface reports an exclu sive interview with James B. Donovan, the American attorney who personally negotiated with the Cuban dictator for the release of the Bay of Pigs prisoners. Read this accurate and current personal ap praisal of the fanatical dictator, who still works to destroy our way of life, by the American who knows him best in the OCTOBER 20TH Weekend Issue of j Family Weelcly with your copy of th Mtolford Mail Tribwn case be brought to his attention j two days before he took oiike unless it had been established in advance that he had no in terest in the affected firm. The tax matter involving the Dillons concerns a closed-end investment company known as United States 4 Foreign Securi ties Corp., whose shares are traded on the New York Stock, Exchange. The firm is holding close to $10 million as a reserve in event of an adverse ruling. Tells of Holdings At his confirmation hearings before the Senate Finance Com mittee on Jan. 11, 1961, Dillon said he personally owned 8'a per cent- of the company's stock and that his family holdings to taled about 35 per cent. He said he planned to continue this in terest through a trust irrevoca ble during his tenure as Treas ury secretary. A Dillon aide told United Press International it could be assumed there has been no change in this situation. He said the secretary, in line with his policy of total isolation from tax matters involving himself, would have no comment on the matter. In its June statement to stock holders, the most recent on file here with the Securities & Ex change Commission (SEC), U.S. & Foreign Securities listed net assets of Sill million, most of them in blue chip common stocks. It said it had set aside $9,650,000 in event of an adverse ruling in the tax case, which it held to be unfounded. Reflects Dillon Ownership It noted that such a ruling could cut the company's net asset value from S36.44 to $33.53, or $2.91 per share. The company has 3.310,815 shares outstanding. The company's most recent annual report to the SEC, filed last April 29, ap peared to reflect Dillon family ownership, mostly through trusts, of 1,010,529 of these shares, which would be about 30 per cent of the total. The case dates back to the 1955 retirement of second preferred stocks of the corporation and of Youth Adventures To Work in Forest A cooperative agreement sign ed recently by the forest service and Youth Adventures, Inc., will permit the Mcdford youth group to undertake development and improvement work projects on the Rogue River National forest, according to C. E. Brown, forest supervisor. The agreement grew out of the efforts of James McGoodwin, Siskiyou regional director of the group, to provide wholesome and educational outdoor activity for youth through camp-out work projects. Projects are picked to provide safe healthful work that will ben efit national forest users. Se lected campsites offer recrea tion opportunity to the group. Technical advice and tools for the projects are furnished by the forest service. MacGoodwin led two camp out work parties last summer on the Butte Falls Ranger dis trict. More than 20 boys, ages 13 to 16, helped clean up camp grounds and lake shores, con structed a foot bridge, installed traffic control barries, construct ed garbage disposal pits, and helped to install part of a camp ground water system. as a memuer ot president icri nedy's cabinet. This "proposed income tax deficiency" initially w:is set at S6.900.0m Accumulated interest since has increased the po'en tial liability to S9.75O.OO0. President Of Firm U.S. i Foreign Securities was set up in 1924 by Dillon, Read & Co., investment bankers. Be fore his appointment by Presi dent Eisenhower as ambas sador to France in 1953, Dillon was president of U.S. & Foreign Securities and chairman of the board of Dillon, Read. After his stint in Paris he moved into the State Department and was un dersecretary of state during the last two years of the Eisenhow er administration. Asked about possible con flicts of interest at his confir mation hearings for the Treas ury post, Dillon said he was di vesting himself of a number of holdings which he ihought might be improper in his new post. He said he had relinquished all active participation in busi ness with his first appointment by Eisenhower, and that much of his holdings already had been turned over to manage ment by irrevocable trusts. He listed 12 firms in which he intended to continue his hold ings, of which U.S. & Foreign Securities was the only one in which he owned as much as one per cent of the outstanding stock. Issues Two Orders In line with his commitments to the finance committee, Dil lon on Feb. 21, 1961.issued two orders designed lo keep speci fic tax cases out of his office. He said tax problems brought to his aides from outside the government should be promptly referred without comment to the commissioner of internal revenue. Where Treasury offi cials needed guidance on tax matters he said they should con sult Treasury Undersecretary Henry Fowler rather than him self. In a separate order he told Fowler he did not want to be concerned with individual tax cases. But he said if any cases came to Fowler for guidance, and Fowler felt the need to dis cuss policy with Dillon, he first should reestablish through Dil lon's trustees that Dillon had no interest in the firm involved. Actually, said a spokesman for the secretary, no tax case ever has been referred to Dillon. TILE COMPANY Dr. Sampson Chairman For Bend Conference ASHLAND Dr. Bill Sampson, chairman of the education di vision at Southern Oregon col lege, was general chairman of the Second Annual Fall Con ference of the Oregon Associa tion for Student Teaching re cently at Bend. 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