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Retired Adm. Hyman Rickover, who allegedly accepted gifts from...

By GREGORY GORDON

WASHINGTON -- Retired Adm. Hyman Rickover, who allegedly accepted gifts from the General Dynamics Corp. while heading the Navy's shipbuilding program, told House investigators the company's chairman advised him this week to plead a faulty memory, sources said Wednesday.

The congressional inquiry, which turned up documents showing Rickover was given diamond earrings, silver and other gifts, also has produced evidence other Navy officials may have received presents, knowledgeable sources said.

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Rep. John Dingell, D-Mich., has asked the General Accounting Office to review account records of General Dynamics to determine the extent of the gift-giving on behalf of the company's Electric Boat shipbuilding division.

The 84-year-old Rickover, who built a reputation as a tough government contract negotiator with General Dynamics, said in a rare telephone interview Wednesday that he phoned company chairman David Lewis in St. Louis almost as soon as he was confronted about the gifts by a reporter on Monday.

Sources said Rickover recalled asking if he had taken any jewelry of value, and offered to repay the money, but Lewis advised against it and suggested he tell questioners that he did not recall.

Asked to confirm this account, Rickover said, 'I will not say that. It would be wrong for me to start accusing him of that. You're asking me something I don't want to answer.'

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A spokesman at the company's St. Louis headquarters declined immediate comment on the Rickover-Lewis conversation.

Rickover described the conversation to investigators for Dingell's Energy and Commerce subcommittee when they interviewed him Tuesday, the sources said.

Defense Department regulations adopted in 1977 bar military personnel or their families from accepting gifts or any other gratuities, and criminal laws prohibit acceptance of large gratuities by federal officials.

The Washington Post, which said the gifts to Rickover from General Dynamics and other shipbuilders allegedly totaled thousands of dollars over two decades, reported the Justice Department also is investigating the matter.

One source told United Press International that the FBI has yet to request interviews with Rickover or other key figures in the matter.

Justice Department spokesman John Russell declined comment.

An aide to Dingell said that, based on the interview with the admiral, investigators found 'no evidence of any consideration for these gifts. Our conclusion is that the taxpayers got their money's worth from Admiral Rickover.'

Rickover, who was with the Navy for 63 years, attributed most of the gifts to ship-launching ceremonies, where gifts such as silver goblets often are passed out by shipbuilders.

'They always hand out these gifts ... so I naturally collected a lot of them,' he said. Asked if he had taken other gifts, such as the $695 pair of diamond earrings, he said, 'I don't know. I'm not a very materially minded person. I spend my time on studying and training people.

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'When I left my job as head of the nuclear section, I had a room full of junk that contractors had given me. I put them out on a table, and the employees who worked for me went out and took them -- not all of them.'

Evidence of the gifts was uncovered during investigations of allegations that General Dynamics officials -- including a fugitive former executive -- took multimillion-dollar kickbacks to inflate or rig subcontracts on government shipbuilding contracts.

A General Dynamics spokesman said in a statement that it would be 'inappropriate' for the company to discuss the alleged gifts because 'the Justice Department is interviewing some of our present and retired employees.'

The company added: 'However, we will say that there has been no wrongdoing by anyone at Electric Boat or General Dynamics and we are very confident that those investigating this matter will come to the same conclusion.'

Sources said there also is evidence the company falsified records to conceal the gifts to Rickover.

Company records show that in 1977, Gorden MacDonald, General Dynamics' top financial officer, twice directed an aide to purchase jewelry for Rickover -- including the earrings and a $430 jade pendant, they said. One purchase was disguised in company records with an invoice that stated the money went for 10 watches for Electric Boat retirees, the sources said.

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