The New York herald., 1922-06-05

the Russian people.
The United States has lent friend
n ~ effort in preserving for the Rus
II sian people the integrity of their
n national patrimony and in safe
i guarding their economic freedom.
|. Finally. America has generously
n come to the relief OF suffering and
n saved millions of Russians from
,l starvation.l For this assistance and
h support in the hours OF distress Rus
4 sia will conserve eternal gratitude.
In addition TO the statement OF funds
handled by Mr. Bakhmeteff, contained
dn the letter of Secretary Mellon to
Secretary Hughes, the letter appends
"a statement to the effect that Mr. Bakh-
meteff. recently at the request of the
Department paid to this Government out
: OF Russian funds. sums amounting to
! $3.50 .a67 90 Drafts for this amount had
I, been drawn by American diplomatic and
7 consular officers In Turkey, 60 cover
/ expenditures connected with the rep
resentation of Russian interests by the
= United States and for aid and pro-
1 lection of Russian citizens in Turkey
during the period prior TO the entry
of the United States into the war.
Secretary Melons Letter.
The letter Of the Secretary of the
! Treasury addressed to the Secretary
/ of State on June 2, covering the ques-
ton of loans to Russia and the financial
relations of Mr.. Bakhmeteff with this
T, Government, was written in response to
a request from Mr.. Hughes under date
l of May %. Mr.. Hughes had called
attention to recent public discussion Of
the subject and asked the Secretary
of the Treasury TO recite the manner
in which the claims of American cit
! izens against the Russian Government
had been handled. He asked also for
any additional information which
might be considered helpful for public
understanding of the matter"
According to this letter it appears
the net amount OF loans advanced to
the provisional government of Russia
from May 16 1917, to November 15.
l 1917, when the Kerensky government
fell. was s1S7.729,75O. On November 15.
I 1917, an additional loan of $1.329,750
| was advanced and used in payment Of
interest on obligations held by the Gov
! ernment of the United States
These obligations ere signed by Boris
/ Bakhmeteff, as Ambassador, under
J authority which had been given him by
! his government. OF the money lent by
, this Government to Russia the AM
bassador transferred $125.0o0,00o to
\ the account OF the Russian Minister OF
K Finance at Petrograd, reserving S62.-
( 600. 900 here. From April 6. 1917. to
March 4. 1921, the total expenditures
, of the Russian Government in this
J country amounted to 1921 100000. show
! Ing that only comparatively small
part Of the American loan was used Tor
these expenditures.
Liquidation of Claims.
| Secretary Mellon's report tells OF 2
liquidation fund established with the
National City Bank of New York. and
1 describes how the American claims were
disposed Of. His statement follows:
''It appears that under the authority
OF the Liberty Bond acts the Secretary
| Of the Treasury. with the approval OIL
\ the President. made certain loans 70 the
| Provisional Government of Russia Tor
the purpose OF more effectually provid-
ing for the national security and defense
and prosecuting the war. The net
J amount OF the loans so made is $751;
| 729,750. Although credit of $l0o,0ov,-
/ 600 was established by the Treasury IN
favor OF the Russian Government on
May 16, 1917, the first loan to that gov,
'-ernment was not actually made until
ls-Tuly 6, 1917 and was in the amount OF
E$S35. 600. 900. No loans were made by the
IjTreasury to the Russian Government al
I3ter the fall of the Provisional Govern
l&ment early in November, 1917, with the
! lAexception of an advance or Sl,529,io oo
4cn November Is. 1917, the proceeds OF
(which were simultaneously applied by
I1he Russians to the payment or interest,"
,to the Government of the United States
The funds advanced by the Treasury
<n making the above loans were usec
3eolely for the purchase of obligations OF
lsfhe Russian Government in accordance
! with the Liberty bond acts, in the same
(, manner as with other Foreign Govern
l5ments, and the funds so paid for these
I}obIigations became the funds of the Rus
;sfan Government. All of the obligations
| sthus purchased are signed in the name
.of the Provisional Government OF Rus
i3eia by Mr.. Boris BalShmeteff. who was
ltthe representative of that Government
URdeeirnated as being authorized to
4eirn them in the name and on behalf
iof that Government.
''In connection with the loans so made
ITO the Russian Government, the latter
jrendered reports to the Treasury OF Its
xexpenditureA These reports cover the
speriod from April 6. 1917. the date oi
the United States Governments entry
Hnto the war. to March 4, 1921, and show
ltotal expenditures for that period oi
iabout 1921 900, 900. The principal items
tTDl SUCH expenditures dpptdir " nave
Ifbeen munitions. including remounts. ex-
hGhange and cotton purchases and other
upplies.
Total Russian Expenditures.
SIT would seem clear that only a
Comparatively small portion of the total
Expenditures Of the Russian Government
n this country during the period re-
ferred to was made from funds ad.
fvanced by the United States Treasury
6n view Of the fact that II appears from
fthe reports filed by the Russian repre-
>eentatives with this department that OF
fthe S7,729,7 $50 SO loaned about $125.-
1000. 900 was transferred by the Russian
&Ambassador to the account of the Rus
i}sian Ministry of Finance at Petrograd
sand only the balance of about $4,000
900 was retained by the Russian Am
sbassador for expenditures in this coun-
lstry.
According 10 Information shown by
uhe Treasury records. the Russian Gov
fernments financial situation in this
3country at the time of the fall OF the
tiProvisional Government in November
'lds17. was. in a Neral way. as follows
"Its bank bag1 then on hand
Anmounted TO aboud $4,000. The
Wsussian Ambassador b. |st!mated that
IDbout $40 900, 900 thereof represented the
balance remaining from this Govern
Anent's loans to Russia, and that the rest
Nj such funds consisted of moneys de-
rrived from other sources. such as British