800.51/910a
The Acting Secretary of State to Diplomatic and Consular Officers
Sirs: In view of the fact that many default situations are arising, that American holders of foreign securities are suffering great losses, and that there did not exist any adequate body to represent their general interest, the Administration took the initiative to bring a suitable and competent body into existence. The Department of State and the Treasury, and the Federal Trade Commission, called to Washington on October 20, 1933, a group of disinterested individuals which had been asked to undertake the task.
The Organizing Committee for the group on December 18, 1933, reported to the full group plans for the organization, and after receiving the necessary approval from the whole group the organization applied for and received a charter from the State of Delaware [Maryland], It will, within the next few weeks, establish its offices and proceed to the study of various situations of great and immediate interest to American holders of foreign securities. This organization is to be independent of the Government in the conduct of its affairs and is to act solely on its own responsibility. The Department understands that it plans gradually to establish working relationships with all interested American parties, and that it will very largely operate through subordinate groups and committees. The Department hopes that the existence of this organization will increase the ability of American holders of foreign securities to protect equitable interests. Towards the organization and such subordinate agencies as may be created, the Government has reserved full liberty of action and expects to cooperate within the proper limits of international law and fairness in the circumstances of each situation.
There are attached for your information copies of the press releases given out by the White House after the meeting of October 20, 1933,6 and by the Foreign Bondholders Protective Council after its organizing meeting on December 18, 1933.5
Very truly yours,