File No. 315.112G75/2

Chargé Spencer to the Secretary of State

No. 346

Sir: With further reference to the arrest of Mr. J. W. Grace, an American citizen residing at Tela and under investigation for the starting of a destructive fire in his hotel on the morning of August 28 last, details of which were reported to the Department in my despatch No. 344 of August 31 last, I have the honor to inform the Department that I have since received a telegram from Consul Dyer of La Ceiba stating that Mr. Grace is at liberty and that the criminal court of La Ceiba is conducting an investigation regarding the origin of the fire.

On three different visits to the Foreign Office this matter has been informally discussed with Dr. Vásquez, who assures me that the conduct of the Tela commandant, will be carefully investigated. This morning, on the last of these visits, at my suggestion Dr. Vasquez sent a telegram to the commandant recommending that he give fullest consideration to any suggestions made to him by Consular Agent Rivers.

I am assured that Consul Dyer will keep me fully informed regarding future developments of the case and I shall promptly report to the Department such action on my part as the circumstances may require.

I have [etc.]

Willing Spencer