INVESTIGATIONS: The Broken Rule

Around the White House offices somber-faced staffers tiptoed across the squares of linoleum tile, whispered out their business as if some member of the official family were seriously ill. There was no laughter; tension ran higher than at any time since Dwight Eisenhower's heart attack. In the spacious, green-carpeted corner office, only 30 paces from the President's own, worked Presidential Assistant Sherman Adams, 59, briskly shuffling papers, softly snapping monosyllabic orders as he had since the day that he became Dwight Eisenhower's chief of staff in January 1953.

But Sherman Adams, the White House and the U.S. knew that things would never be the same again. Adams was the man who decried the influence peddling of the Truman Administration, the stern moralist who had banished Republicans from the Administration at the first hint of errant behavior, the walking book of ethics dedicated to keeping the Eisenhower Administration spotless, as Candidate Eisenhower put it in 1952, "clean as a hound's tooth." This same Sherman Adams was now being held up in headlines from coast to coast as a man who lent his influence to a friend in trouble with Government agencies. Neither the secondhand reassurances of the President nor the rearguard action of Presidential Press Secretary James Hagerty could do very much to take the sensation out of the story.

Adams was pinpointed by two investigators of the House Special Subcommittee on Legislative Oversight. They turned up in Boston a month ago, took time out to follow up a tip to look at the books of the stately Sheraton Plaza Hotel. They hit pay dirt: on a dozen occasions between 1955 and May 1958, members of the Adams family stayed at the Sheraton Plaza and racked up total board and food tabs of nearly $2,000. The bills, the investigators found, were paid in full by a millionaire Boston textile manufacturer and real estate man named Bernard Goldfine (see box).

Then, back in Washington, the committee put together the other end of the story, turned up three instances of Goldfine's benefiting from his friendship with Sherman Adams:

¶ On Dec. 30, 1953, Adams called Federal Trade Commission Chairman Edward F. Howrey to ask for the source of an FTC complaint against Goldfine for putting a "90% wool, 10% vicuña" label on cloth that actually contained some nylon. ¶ On April 14, 1955, when Goldfine was investigated again on the same charge, Adams got him an appointment to meet Chairman Howrey. Once there, Goldfine waved the Adams name like a magic sledge hammer. "Please get Sherman Adams on the line for me," he ordered, loud enough for nearby FTC staffers to hear. "Sherm, I'm over at the FTC," he said on the telephone. "I was well received over here." ¶ The next year, Adams asked White House Special Counsel Gerald Morgan to check with Securities and Exchange

Commission lawyers to see why Goldfine's East Boston Co. was under investigation.