Congressional Committee to Probe Arab Pressure on American Firms

Rep. Thomas M. Rees (D, Calif;) has pledged “a vigorous and thorough” investigation by the Congressional subcommittee he heads of alleged pressure by Arab nations on American companies to discriminate against employee or customers of the Jewish faith. Rees, who is chairman of the House Banking Committee’s subcommittee on International Trade, Investment and Monetary Policy, said his subcommittee has received a “very disturbing report” of attempts at discrimination in international financial transactions.

He said the Controller of Currency has recently learned that some national banks may have been offered large deposits and loans by agents of foreign investors on condition that no member of the Jewish faith sit on the bank’s board of directors or control any significant amount of the bank’s outstanding stock. “This is the sort of allegation which if proven must be stopped,” Rees declared.

SAUDI-MIT ACCORD SUSPENDED

It was learned, meanwhile, that negotiations for a technical assistance contract between the Massachusetts Institute of Technology and Saudi Arabia have broken down as a result of the Saudi’s last minute refusal to sign the contract which contains a clause prohibiting Saudi Arabia from denying a visa to any member of the project working staff or academic personnel, including students assigned to the project by MIT because of their religious affiliation.

Prince Mohammed ibn Faisal, chairman of the Saudian Saline Water Conversion Corp., balked at signing the contract in Jidda last Thursday because of an allegedly “threatening letter” he received from Dr. Jerome Wiesner, president of MIT, according to reports reaching here. Members of the American negotiating team, led by Prof. William W. Seifert, had reported acceptance of the visa clause by the Saudis.

The letter from Dr. Wiesner reportedly stated that any act of racial or religious discrimination toward an MIT participant would be cause for cancellation. The $2 million contract was to have provided experts for planning Saudi Arabia’s water requirements for the next 20 years. Dr. Wiesner has denied having written any “threatening letters” to Prince Mohammed or anyone else.

PROMISES VIGOROUS INVESTIGATION

The Rees subcommittee investigation will examine so-called “indirect” discrimination when one American company is pressured by the Arabs into a middle-man role and discriminates against another U.S. company or against employes of customers of the Jewish faith. “This investigation,” Rees said, “will be a vigorous and thorough study of recent reports about Arab efforts to export their discriminatory practices. Such practices do not conform to the principles for which America stands, and we in Congress have a clear duty to protect our citizens from foreign discrimination,” the Congressman said.