Business & Finance: The Fist Tightens

The Senate Committee probing RFC last week drew a bead on one of RFC's best customers—Kaiser-Frazer Corp. In a 30-page report, the Committee charged RFC should not have made a $34 million loan to K-F in October 1949. Even though K-F would have gone bankrupt without it, said the Committee, K-F's prospects of repaying out of earnings were so dim that "the public [interest]...did not justify the use of public funds to continue operation of K-F as an auto company." Following the first loan, K-F tapped RFC for $35 million more, repaid about $11 million. That wasn't fast enough for RFC...

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