817.77/261: Telegram

The Chargé in Nicaragua (Beaulac) to the Secretary of State

275. Supplementing my 274, November 23, 4 p.m. The Minister of Finance following decree of November 8th, appointing Kennedy acting manager, instructed the National Bank in writing to place railroad funds at order of the Government. This order was later countermanded verbally by President Moncada. Government is paying salaries of railroad employees with money borrowed from the Anglo-South American Bank.

[Page 661]

Rosenthal has cabled to New York office of the National Bank requesting that it ascertain from new board of directors of railroad whom the board has authorized to draw funds needed for payrolls, et cetera. In order to preserve railroad funds and still carry on, it is suggested that new board of directors direct the National Bank from time to time to place certain funds at the disposal of the Government or local officials of the railroad, such funds being limited strictly to needs of operation.