File No. 817.51/840

The Secretary of State to the Financial Agent of Nicaragua

Sir: The Department has received your communication of October 30, 1916,1 enclosing copies of the contracts concluded by you with Messrs. Brown Brothers and Company and J. and W. Seligman and Company, and with the National Bank of Nicaragua, under date of October 26, 1916, in behalf of the Government of Nicaragua, relative to the adjustment of debts owing by the Nicaraguan Government to the other parties to this contract out of funds which the United States Government is obligated to pay the Government of Nicaragua, under the terms of the treaty relating to the interoceanic canal.

The Department desires to inform you that it has examined these contracts and you are advised that its attitude towards them is the same as expressed to you in its communication of August 31, in relation to the former contracts signed by you on behalf of the Government of Nicaragua with Messrs. Brown Brothers and Company and J. and W. Seligman and Company and with the National Bank of Nicaragua, Incorporated.

The Department has instructed the American Minister at Managua to bring to the attention of the Nicaraguan Government the fact that these contracts have been received and again to express its regret that action looking to the disposition of the funds in question appears to have been taken by the Government of Nicaragua without proper regard for provisions contained in the recently ratified treaty.

The Department, therefore, can take no cognizance of the contracts transmitted with your letter under acknowledgment, other than to emphasize to the Government of Nicaragua the Department’s views respecting contracts of this character and to request a prompt statement from the Nicaraguan Government in relation to them.

I am [etc.]

Robert Lansing
  1. Not printed.