The Minister in the Dominican Republic (Schoenfeld) to the Secretary of State
[Received 3:35 p.m.]
72. Dunn informs me this morning that local representative of National City Bank of New York reports his head office has not been [Page 122] informed by Lee, Higginson of official notice of decrees transmitted to fiscal agents by telegram of Dominican Minister of Finance, October 7.34 Dunn has therefore requested local representative National City Bank to advise his head office of the action of the Dominican Government and to inquire whether head office would object to Dominican Government cabling Lee, Higginson and Company inquiring whether the latter would be willing to step aside and allow National City Bank to assume lead in attempting to carry out refunding plan.
I assume that the Department has been in constant communication with Lee, Higginson in order to exhaust every possibility of securing their cooperation with the Dominican Government in debt readjustment but I gather that Lee, Higginson are inclined to wash their hands of the situation and to attempt to place responsibility on the Department of State. Under the circumstances, I respectfully request that unless Lee, Higginson have definitely determined on a negative attitude, the Department make a further effort to secure their active assistance.
It is already evident that the Dominican Government is considering an extension of emergency procedure to divert amortization on entire outstanding loans or alternatively the entire service of the two series of 1926 bonds including interest. I have made it clear that an incontestable showing of necessity for this together with unquestionable assurances as to the purposes to which funds would be applied and as to the agency through which they would be disbursed will have to be made before this Legation could undertake to submit so far reaching a proposition to the Department. It seems to me to be increasingly desirable that another and stronger effort be made, if possible, to secure cooperation of the bankers.