The Minister in the Dominican Republic ( Schoenfeld ) to the Secretary of State

No. 715

Sir: I have the honor to inform the Department that Mr. William E. Dunn, Financial Adviser to the Dominican Government and Special Agent for the Emergency, returned to Santo Domingo from the United States yesterday.

Mr. Dunn has informed me that the legal preliminaries for the transfer of the Fiscal Agency for Dominican loans from Messrs. Lee, Higginson and Company to the Guaranty Trust Company were passed upon by counsel in New York and that the arrangements for the transfer would shortly be completed. In the meantime, Messrs. Lee, [Page 619] Higginson and Company had formally tendered to the Dominican Government their resignation as Fiscal Agents and the necessary documents and executive decree were being drawn up here in compliance with the recommendations of counsel in New York. As soon as appropriate notification of action at this end were transmitted to New York, it was expected that public announcement under the loan contracts would be made of the resignation of Messrs. Lee, Higginson and Company and of the appointment of the Guaranty Trust Company as Fiscal Agents for Dominican loans.31 According to Mr. Dunn, it was possible also to arrange for the appointment of Lee, Higginson Corporation as co-paying agents for Dominican loans in Boston and Chicago.

Mr. Dunn informs me that the proposed legislation to amend the Emergency Law referred to in my despatch No. 677 of November 15, 1932 and previous correspondence, is in abeyance for the present inasmuch as it was found expedient to change the sequence of the procedure as contemplated at the date of my despatch cited. It appears now to be intended to send a formal communication to the new Fiscal Agents, when they assume their duties, substantially in the terms of the proposed note to the American Government enclosed with my despatch mentioned, with a view to consideration of the problem by the Fiscal Agents, the organization of some agency representing the bondholders with whom the Dominican Government may properly discuss the situation and with a view to the eventual amendment of the Emergency Law in pursuance of the suggestions and consent of the Fiscal Agents and of such authorized agency representing the bondholders as it may prove practicable to set up.

It is apparently the intention of the Financial Adviser to return to the United States during January next, at which time the necessary public announcements of the transfer of the Fiscal Agency are expected to have been published in the newspapers for the requisite period and the Fiscal Agency will have been definitely taken over by Guaranty Trust Company. At that time, Mr. Dunn expects to begin detailed discussion of the general plan above outlined preparatory to its execution in so far as it may require action both in the United States and in Santo Domingo.

Respectfully yours,

H. F. Arthur Schoenfeld
  1. Decree dated December 14, 1932, issued by the President of the Dominican Republic, accepting the resignation of Messrs. Lee, Higginson and Company as Fiscal Agents for Dominican loans and appointing the Guaranty Trust Company of New York as Fiscal Agents for these loans was published in Gaceta Oficial No. 4531, December 17, 1932.