File No. 817.51/809
Minister Jefferson to the Secretary of State
Managua , August 13, 1916, 11 a.m.
The Department’s August 10, 4 p.m. I deem it inadvisable to make full payments from treaty proceeds to bankers and others, for example, the treasury bill principal and interest amount to $1,210,413.70, the national bank rate loan principal and interest $98,014.99. Ethelburga interest for two years $756,000 and the Amsinck account, principal and interest to December 31, 1916, $314,271.82. Should the above amounts be paid the money would go into the hands of a few, leaving but small amount to be applied to other outstanding debts and would cause a great disappointment to the people of Nicaragua.
I think best to pay mixed claims awards first and then pro rata payments and arrange with bankers for balance due them. Many of the accounts should be scaled down, the interest in many cases being exorbitant and unjust.
The question of the retention of customs revenues, other expenditures of money should be temporarily withheld.