He resigned in 1919, however, to accept a position with the U.S. State Department as a financial adviser to Haiti, during the island republic's occupation by the U.S. Marines. During his time in Haiti, he clashed with Haitian president Philippe Sudré Dartiguenave over economic issues, which resulted in McIlhenny suspending Dartiguenave's salary, causing a diplomatic crisis and inviting private criticism from the U.S. State Department.