811.515/1449
The Ambassador in Bolivia ( Boal ) to the Secretary of State
[Received July 18.]
Sir: I have the honor to refer to the Department’s telegram No. 440 of July 10, 1942, 8 p.m., as well as to the Embassy’s telegram in [Page 622] reply, No. 534 of July 13, 12 noon,12 and to the Embassy’s despatch No. 247 of July 8, 1942,13 all referring to the control measures instituted by the Bolivian Government for the purpose of transmitting United States currency to the Treasury Department.
As stated in the Embassy’s telegram and despatch under reference, the controls instituted by the Bolivian Government are believed to be satisfactory and to be working effectively. However, it has occurred to the Embassy that it may be of interest to the Department to know that the Banco Central has the apparent intention of using the foreign dollar exchange turned over to it under the control measures in its own name. As will be recalled, the control measures provide that all dollar currency turned over to the bank by individuals will be deposited to the bank’s own account in New York, and once the funds are released by the Treasury Department, the Banco Central will carry out the respective liquidation with the individual who makes the deposit here. It has been learned through reliable sources that the Banco Central has announced to depositors that it will not return the dollars either as traveler’s checks or in drafts to the original owners, but will purchase the dollars at the official rate of exchange, which is 46 bolivianos to the dollar. Since the street rate has risen to as high as 52 bolivianos to the dollar, the benefits to the bank in securing dollar exchange at the lower figure are obvious.
Respectfully yours,