New-York tribune., 1917-06-11
Banks Take Action
To Check Financial
Aid to the Enemy
Cooperation Of Telegraph and
Express Companies Asked by
Reserve Board

Emphasizing the fact that no foreign
exchange or banking business Of g
nature calculated to give aid or COM
fort TO the enemy directly or indi'
rectly will be countenanced. the Fed
eral Reserve Board at Washington has
sent out instructions to the twelve Fed
eral Reserve institutions for retrans-
mission to member and other banks in
the several districts relating to trans
actions of American banks which In
volve dealings with alien enemies. 1t
is understood that the committee of
foreign exchange bankers recently ap-
pointed for the purpose of scrutiniz-
ing all exchange operations and gold
exports had hand in framing the let
ter Of instructions.
Under the governments programme
for stopping all banking operations
with alien enemies express and tele-
graph companies have been called into
service. Moreover. the large force OF
national bank examiners under tho
charge Of the Controller Of the Cur
rency Is cooperating with the Wash
ington authorities.
This step has been taken at tho sug-
gestion Of the State Department which
recently sent q communication to the
Federal Reserve Board calling It's at
tention to the desirability Of guarding
against transfers OF banking credits
TO neutral countries for the account Of
alien enemies and against the usc OF
domestic credits for similar purposes.
Gold Exports Scrutinized
Shortly before the entrance Of the
United States into the war. and sub
sequently, gold shipments to South
America and Mexico were looked upon
with suspicion by governmental author
tiles. who saw in such transfers from
the United States a possible attempt
on the part Of German interests here
10 transfer their credits to neutral
countries. Owing, 1t Is said. to the
activity OF the government such move
ments have been reduced TO minimum,
and the letter that has been sent out
from Washington for distribution
among the banks Of the country will,
il is hoped, effectually stop sll such
transfers. That the Treasury Depart
ment is exercising control over the
gold movement to japan is we'll known.
Transactions To Be Watched
The letter sent out by the Federal
Reserve Board covering operations with
alien enemies says:
"The board is informed that the
State Department is not concerned IN
the ordinary commercial transactions
and routine bank accounts OF aliens
Of whatsoever nationality, resident in
the United States, with banks situated
therein. II is suggested by the de-
partment, however, that each banker
doing business in this country SHOULD
scrutinize with particular care such
accounts as may be held by his bank
for any resident alien enemy, and in
the event any suspicious transactions
counts, that they be reported immedi-
ately to the board for transmission to
the proper department.
"The transactions which are Inter-
esting to the State Department may
be divided into three classes:
"1. Foreign exchange transactions be-
tween banks in this country and banks
in neutral countries in Europe;
80 10,
such as the obtaining Of credits by
alien enemies resident In the United
States;
"3. Banking transactions between this
country and Mexico, or Central Ameri-
Can and South American countries.
"The State Department is especially
interested in preventing all transfers
of money by cable, by draft, or by
shipments of currency or otherwise to
neutral countries in Europe for the
account of alien enemies.
at is, Of course, difficult for bank
TO determine offhand whether or not a
transfer is for the account Of alien
enemies when it is asked by an indi-
vidual or corporation in this country to
make n transfer TO bank in a neutral
country.
ne Doard IL ADVISED, however, tnat
the State Department Is anxious that
bankers throughout the country should
be warned that they should scrutinize
most carefully every application made
TO them involving the transfers Of funds
to neutral European countries, which
transfers seem intended to give aid to
the enemies of this country, either di-
rectly or indirectly.
Suspicious Connections
"The board Is further advised that
Tho State Denartment is intereetnd In