The fate of several Justice Department investigations into alleged illegal payoffs and rebates in the shipping industry is up in th air, pending a decision expected next week from Attorney General Griffin Bell.
In a highly unusual move, Bell last week ordered U.S. Attorneys in Cleveland and Newark to hold up efforts aimed at prosecuting several shipping firms.
Bell's action came after a request from two senators and a congressman who said they were preparing legislation that would provide amnesty for the firms under investigation.
Sen. Daniel Inouye (D-Hawaii), Sen. Ted Stevens (D-N.Y.) wrote to Bell asking him to "consider advising all local U.S. Attorneys that prosecutions for rebating or conspiracy to rebate be held in abeyance pending outcome of legislation now under active consideration."
The legislation, they pointed out, is designed "to encourage everyone who has been involved in rebating to come forward and disclose the nature and extent of his activities, and thereby assist the Federal Maritime Commission in acquiring greater knowledge and familiarity with comtemporary malpractices."
In addition, the legislators feared that prosecution of American flag carriers would put them at a disadvantage because foreign carriers allegedly do the same thing, and are out of reach of U.S. prosecution.
One of the films being investigated in connection with the probe is Seatrain Lines, Inc., of New York. In a report filed with the Securities and Exchange Commission this week, Seatrain acknowledged that it was a target of probes by the Justice Department, Federal Maritime Commission and the SEC.
"The company is discussing with the Federal Maritime Commission the possibility of a settlement with respect to any such violations of the Shipping Act. It is anticipated that such a settlement will involved a monetary penalty and, possibly, other sanctions," Seatrain said in its filing.
Another firm reportedly under investigation is sea-Land, a division of R. J. Renolds Industries.
The Cleveland investigation began in 1976, when officers of Cleveland-based Tenna Corp. resigned following disclosure that they had taken kickbacks from Seatrain in 1974 and 1975.
Tenna is the world's largest manufacturer of automobile retractable antennas.
The probe led Justice Department investigators into the network of payoffs by shipping firms to the executives of companies whose goods they carry.
According to sources close to the investigations, the payoffs generally were included in the bills for shipping the goods.
Justice Department sources say many of the attorneys involved in the probes are dissatsified with the department's decision to halt their efforts until a decision is reached on the pending legislation.