891.51A/10–1344: Telegram
The Ambassador in Iran (Morris) to the Secretary of State
[Received 2:22 p.m.]
755. With further reference to Millspaugh’s attempted dismissal of Ebtehaj, I wish to say that Millspaugh in basing himself upon article VIII of the law of 21 Aban 132137 has presumably derived the authority for his action from the language of that article which says, (in paraphrase)
“Under the general supervision of the Minister of Finance, the Administrator General of the Finances shall have direct charge of all the administration of financial affairs—and in conformity with the employment laws and after consulting with the Minister of Finance, he has the right to promote, demote, appoint, dismiss or transfer any employee of the Finance Ministry or any employee connected with the administration of finance and or establishments which are operated with Government capital, and employees of the offices directly connected with the expenditure of public funds and or with the collection of accounts.”
Presumably Millspaugh interprets the language “establishments which are operated with Government capital” to include the Bank Melli. On the other hand, the viewpoint expressed by the Prime Minister to me is that the bank is an autonomous institution and the appointment of its general manager, called locally governor by courtesy, is made by the Council of Ministers upon nomination by the Minister of Finance and requires ratification by imperial firman. The statutes of the bank confirm this. However, the statutes are silent as to the mode of dismissal of the governor. I think we can take it for granted that the Iranian Government and Parliament in granting Millspaugh such powers did not contemplate giving him the sole right of employment and dismissal of a high official whose employment is clearly defined in the statutes of the bank, yet this is just what Millspaugh is attempting to do without the support of the Minister of Finance and despite the verbal disapproval of the President of the Council of Ministers.
Nothing further has come to light in respect to the Government’s decision in this matter. It has not yet been discussed openly in Parliament and the newspapers are refraining from comment, much to my present satisfaction. One newspaper, indeed, printed that Zand, former Minister of War, had been appointed to succeed Ebtehaj. There is no official confirmation of this. Zand is said to be in favor with the Shah and Court Minister Ala. The latter, however, protested [Page 432] to me very quickly and vigorously against Millspaugh’s action. I had the distinct impression that Ala supports Ebtehaj strongly even though he may also like Zand.
- i.e., 1942.↩