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General Dynamics is Crown family's jewel

ST. LOUIS -- The most powerful shareholders of General Dynamics Corp., financier Col. Henry Crown and his son, Lester, said in an interview they support the defense firm's management team despite charges of contract fraud.

The Crown family holdings in General Dynamics, which is based in Clayton, Mo., are valued at more than $650 million.

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For more than a year, the defense firm has been accused of contract fraud and improper government billings, which date to the 1970s and total several hundred million dollars.

Both Crown and his son have steadfastly supported the management of the company, including its embattled chairman, David S. Lewis, and have made it clear they would resist any efforts by the Pentagon to force Lewis out.

'David Lewis is one of the finest and ablest men I've ever known,' Lester Crown told the St. Louis Post-Dispatch in its Sunday editions. 'The only thing that exceeds his ability is his integrity. He is s honest as he is able.'

Lewis h s admitted the company made mistakes in its billings but denies the mistakes were major or were intended to defraud taxpayers.

It was Lewis -- handpicked by Crown to head Genral Dynamics 15 years ago -- who is credited with turning the ailing firm around and making it one of the nation's top three defense contractors.

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Lester Crown also has problems with congressional investigators, who are looking into a proported bribery scheme in 1972 in which Crown authorized payment of about $23,000 to some Illinois state legislators.

The Crown family owns more than 23 percent of General Dynamics' common stock -- the single largest bloc of shares in the company.

The company's proxy statement for its annual meeting earlier this month listed the family s owning more than 9.8 million shares, currently valued at more than $650 million. Crown's ties to General Dynamics date to late 1959.

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