IN RE: INVESTIGATION BY SPECIAL AGENT PHILLIPS OF J. J. LAUGHINGHOUSE, CHAIRMAN OF LOCAL EXEMPTION BOARD OF PITT COUNTY, NORTH CAROLINA, AND CHARGES OF POLITICAL ACTIVITY AGAINST GOVERNOR BICKETT.

Various complaints came to Special Agent Phillips that the Draft was being improperly administered by the Local Exemption Board for Pitt County, North Carolina, and on August 26, 1917, he made a personal investigation of this Board. He found that the complaints were occasioned because of deferred classifications granted by this Board to wealthy registrants and that one of these deferred classifications complained of was that granted on the grounds of dependency to Ned Laughinghouse, son of J. J. Laughinghouse, Chairman of the Board. After serving four days, Dr. J. E. Noble, Medical Member of the Board, resigned and published a statement to the effect that his resignation was due to unfair discrimination shown by the Board in granting exemptions.

Mr. Phillips continued his investigation of this Board and from time to time submitted reports to this office and also reported to Major Langston, Military Aide to the Governor, as to the results of such investigation. On January 11, 1918, he wrote a letter to Major Langston, suggestin the removal from office of J. J. Laughinghouse, Chairman, and Government Appeal Agent Simons. This recommendation of Mr. Phillips, with his reports upon which the same was based, was submitted to the Provost Marshal General on January 16, 1918, for his appropriate attention. On January 29, the Provost Marshal General sent me a copy of a communication received by him from Major Langston, advising the Provost Marshal General of the removal from this Board of Government Appeal Agent Simons and recommending that no further change in the personnel of the Board be made.

As the complaints against the Board did not cease, Special Agent Phillips continued his investigation and wrote this Bureau concerning the same on April 15, 1918. From this letter it appears that Phillips had secured proof showing that ten registrants of Pitt County were placed in a deferred class by the Local Board, whose action was reversed by the District Board, and the questionnaires of the men were returned to the Local Board for classification in conformity with the decision of the District Board. After these questionnaires reached the Local Board, Laughinghouse again placed them in deferred classes and falsified his records by showing the registrants to be in the class given them by the District Board. These facts were reported to Major Langston, who said that the matter had been taken up with the Governor, but who did not know whether the Governor was going to take any action or not. Phillips was later informed by Major Langston that a letter had been received from the Provost Marshal General, recommending that the Governor remove Laughinghouse from the Board.

In his letter of April 15, 1918, Phillips said:

“The Governor did not do this, but appointed another Government Appeal Agent. The reason that the Governor will not remove Laughinghouse is for the fact that the Secretary of State of North Carolina is a son-in-law of Laughinghouse; another reason is purely political. I am frank to say that I find the Governor playing politics with the members of the Boards. Several times he has written the Local Board in behalf of an individual registrant and in one or two cases the Board has classified them in classes which they have been frank to say, did not belong in a deferred class. These cases I have investigated and put the facts before the District Board and they have been placed in their correct classes.”

A copy of this letter of April 15, 1918, was sent to the Provost Marshal General, without comment, for his appropriate action.

Later Laughinghouse prepared a statement for the press, publicly criticising the zeal of the Government Appeal Agent in taking cases to District Boards where deferred classifications were granted by the Local Board, as his office compelled him to do. The publication of this article was suppressed by Major Langston.

Special Agent Phillips then reported the results of his investigation of Laughinghouse to United States Attorney Carr and was advised that a prosecution would lie against Laughinghouse for a violation of Section 6 of the Selective Service Law, for his falsification of the records of the Local Board.

On May 10, 1918, this office was advised by the Provost Marshal General that Laughinghouse had been removed from office.

On May 18, 1918, the Provost Marshal General forwarded to this office a copy of the letter received by him and quoted in Governor Bickett’s personal letter to the Attorney General. A letter was thereupon sent to Special Agent Phillips, asking for an explanation of the charges made. He replied, stating that he did not know how the Governor had become aware of his charge that he had been playing politics, that no such charges, either verbally or in writing, had been made, except in the letter which he sent the Bureau on April 15, as quoted above. He further said:

“If a copy of this letter was sent the Provost Marshal General, I can then account account for the Governor being advised of my statement, as there are several North Carolinians in his office, one of whom was Director of Military Enrollment previous to his appointment as Lieutenant and assignment in Washington.”

I then took the matter up by telephone with the Provost Marshal General’s office and learned from Lieutenant Hughes that in recommending to Major Langston the removal of Laughinghouse, they had transmitted to him Special Agent Phillips’ letter of April 15th, and apparently he, in turn, showed this letter to the Governor, which accounts for all of his ill feeling against Phillips.

On June 14, 1918, United States Attorney Carr wrote the Bureau, suggesting that no prosecution be instituted against Laughinghouse at that time. In this recommendation Government Appeal Agent Wooten, of the Pitt Board, concurred. I quote from a letter written by Mr. Wooten to Major Langston, dated May 10, 1918:

“The foregoing reasons are, in my opinion, sufficient to justify me in asking that you suggest to the Department of Justice that it has already accomplished in this County the corrections demanded. And further I state that it has been done in such manner as to reflect great credit on the efficiency of the Department.”

On June 19, 1918, a letter was written to Mr. Carr, advising him that the prosecution of Laughinghouse at that time was left to his discretion, but that it was expected that his discretion would be exercised in such a way as to promote the most effective operation of the Selective Service Act in that community.

While Mr. Phillips was very zealous and painstaking in this investigation, the same was conducted by him with great discretion, and he has never openly criticised Governor Bickett, nor, so far as appears from our files, has he made any insinuations against him resulting from this investigation. As appears above, this unfortunate condition would not have arisen if the Provost Marshal General’s office had not sent to Governor Bickett’s office a copy of Special Agent Phillips’ letter of April 15, 1918. I do not think that any serious consideration should be given to the charge that Special Agent Phillips has been addicted to the use of alcoholic liquor, as he has been one of our most efficient Agents in enforcing the liquor and vice regulations under Sections 12 and 13 of the Selective Service Act.