The following are corrections of certain statements made in articles concerning Page Airways Inc., Wilmorite Inc. and J.P. Wilmot published during the past year. There is no ongoing dispute between the FAA and Page with respect to an FAA audit of Page's contracts at Dulles and National airport's, as stated in our article. In fact, the matter was settled in February 1975. Page has set aside $9 million with a court to cover an antitrust judgement against it, pending the outcome of its appeal. It is not preparing itself to make such a payment and, therefore, does not have to devote any further funds to this purpose as we suggested. Moreover, the company has paid dividends only once in its corporate history and its not having done so during the past two years is not, as we inferred, necessarily related to its having set aside the above-noted $9 million. Wilmorite was not the recipient of $88 million in federal rent subsidies as reported. It was neither an applicant for, nor a direct beneficiary of, these funds. It only contracted with the recipient to build apartment buildings for which it was paid $16,500,000 to cover costs of construction. The Post reported that Page's National and Dulles airport contracts were awarded in violation of federal competitive bidding policy. We have been informed by some FAA officials that exceptions to the general competitive bidding requirements are permissible, if certain sole source criteria are satisfied and that they believe these criteria were satisfied in Page's case. There is no indication that the FAA decision to extend the Page contracts without rebidding was the product of improper activity by Page or its employes.
A former Grumman Corp. subsidiary pleaded guilty in federal court yesterday to making false statements about more than $5 million in payments it made to foreign officials in connection with the sale of executive jets.
U.S. District Court Judge Oliver Gasch accepted a plea-bargaining agreement under which the company, now known as Gulfstream American Corp., will pay the maximum fine allowed, $10,000 on each of 12 counts.
The case is the latest in a series of investigations of alleged overseas bribery by multinational corporations. The probes are being conducted by a Justice Department-U.S. Customs Service task force.
In an "offer of proof" read into the court record, Justice fraud section attorney Ronnie L. Edelman detailed payments the firm made on 10 sales of its deluxe Gulfstream II jet in six countries between 1974 and 1977. The $6 million jet seats up to 19 percengers and flies nearly 600 miles per hour.
The "commissions" paid by the Grumman American Aviation Corp. ranged as high as $1.3 million in one instance to a sales representative in Saudi Arabia. Another sale in Morocco included payments to a former prime minister of Lebanon that were laundered through two bank accounts in Liechenstein.
The names of the foreign officials who finally received the funds could not be learned in each instance because middlemen protected them, sources said. The names of at least two present foreign government officials who allegedly received payments were deleted from the "offer of proof" just before the public pleading after objections from company attorneys, the sources said.
A recent Justice Department plea agreement in a foreign bribery case with the Westinghouse Corp. was delayed temporarily when Judge Barrington Parker objected to the omission of the name of the country involved. The Washington Post reported that an Egyptian official had received payments in that case and Parker finally accepted the Westinghouse plea.
There was no indication yesterday that Justice initiated -- as it did in the Westinghouse case -- the idea of dropping the names.
In a press release from its Bethpage, Long Island, headquarters yesterday, Grumman said the guilty plea was a "sensible way to avoid the extraordinary expense and inconvenience of prolonged litigation."
Grumman sold its aviation subsidiary last fall to a Nevada company that renamed it Gulfstream American. Though it was Gulfstream that entered the guilty plea yesterday, Grumman has agreed to pay the new owners an amount equal to the fine, company attorneys said in court.
As part of the agreement, Justice said it would not prosecute any Grumman executives, though senior vice president Charles Vogeley allegedly was aware of many of the payments.
Grumman noted in its statement that the government had not attacked the legality of the payments, just the "accuracy and completeness" of its filings on foreign sales. The false-statement statute was used because until December 1977 it was not illegal to bribe foreign officials.
The company was charged specifically with two counts of making false statements to the Export-Import Bank about commissions on the sale of planes to the African country of Togo and to a private corporation in Venezuela. The countries bad borrowed money from the Ex-Im Bank to finance the jets.
In the 10 other counts, Grumman was charged with making false statements on Commerce Department forms, declaring the value of exports by failing to subtract commissions from the total as required.
Company attorneys told the judge that they conceded the government had enough evidence to prove the charges.
At times, the government charged, Grumman acted with Page Airways Inc., its foreign distributor, in making the payments.
Page was charged last year by the Securities and Exchange Commission with making $2.5 million in illegal foreign payments, but denied the allegations and has been fighting that civil action in court.
Judah Best, an attorney who reprepresents Page, said yesterday that the Grumman action "doesn't trouble us in any way because we haven't violated the criminal laws of the United States or any other country. Grumman may have had the requisite guilty knowledge; Page didn't," he said.
Page wasn't named as a defendant in yesterday's action.
According to the government offer of proof, Pge made a $450,000 payment in the Malaysian state of Sabah. Page was involved again in the resale of planes to Saudi Arabia, in which as much as $4 million in commissions was promised, the Justice document said.