The Justice Department yielded yesterday to a Senate subcommittee's demands and gave the panel some documents relating to its criminal investigations into shipbuilding claims from Virginia's largest private employer and another shipyard.
The Senate Judiciary subcommittee on administrative practice and procedure had demanded the materials Monday after senators questioned why the investigations were ended.
A memo from the office of the U.S. attorney in Alexandria in 1981, that was released at a hearing, pleaded for continuing the investigation of Newport News Shipbuilding and Dry Dock Co. and called the shipyard's claims for $894 million from the Navy "the greatest assault on the U.S. Treasury in American history."
Assistant Attorney General Stephen Trott yesterday presented Sen. Charles E. Grassley (R-Iowa), the subcommittee chairman, with a briefcase of documents he said included all the department's materials on a closed investigation of claims filed by Lockheed Corp. and edited material relating to the Virginia investigation. He said the department will file a petition in federal court in Alexandria next week seeking direction as to whether additional information regarding the Newport News investigation can be given to Congress.
Trott refused yesterday to hand over materials relating to an investigation of the electric boat division of General Dynamics Corp. He said documents relating to the case must remain confidential because of a continuing grand jury investigation.
The documents, which Grassley subpoenaed Monday, are expected to give the committee insight into why Justice officials stopped investigations into $894 million in shipbuilding claims by Newport News, $160 million by Lockheed Corp. and $843 million filed by General Dynamics. The two former cases were later settled for about 25 percent of the shipyards' original claims while the government paid General Dynamics 75 percent of its claim.
The General Dynamics case first was killed but then reopened after corporate executives accused the company of intentionally bidding low to win Navy shipbuilding contracts and then filing overrun claims.
Federal investigators were looking into the possibility of fraud in the initial claims for construction of nuclear submarines, cruisers and aircraft carriers but closed the Lockhead and Newport News cases in 1979 and 1983 without filing criminal charges.
Documents made public Monday showed that investigators in the U.S. attorney's office in Alexandria pushed to continue the investigation of Newport News as late as May 1983. Those documents said investigators told D. Lowell Jensen, the former head of Justice's criminal division, they could quickly assemble information to fashion strong indictments of Newport News.
A 1981 report by the Alexandria office cited evidence of a Newport News conspiracy that was "staggering in its size and complexity." Additional documents signed by Alexandria U.S. Attorney Elsie Munsell included scathing criticism of the handling of the investigation by the department's fraud section.
Munsell, a presidential appointee now under consideration for a federal judgeship, declined yesterday to comment on the documents.
At a hearing Monday, Grassley complained that Trott and justice officials were being uncooperative in the Senate inquiry. "I detect some different attitude today than there was previously," he said after receiving the new documents.
Grassley said his subcommittee may still press for the General Dynamics materials.