895B.10/9–2551
The Secretary of Defense (Lovett) to the Secretary of State
Dear Mr. Secretary: The Department of Defense has noted the decision contained in your letter of 8 September 1951 to release to the Government of the Republic of Korea the funds now held in a suspense account in the Treasury Department which have been accumulated from sales of Korean currency to United States troops for their personal expenditures.
Because of the Department of Defense interest in the conditions of the release and the administration of the funds, since this matter could influence other financial and economic developments that might affect the discharging of the Department of Defense responsibility for short-term relief and rehabilitation and the conduct of military operations in Korea, we believe that it would be highly desirable that the conditions of the release and the manner of the administration of the funds should be worked out jointly by the staffs of the Department of Defense, the Department of State, and the Treasury Department.
In this connection, although the Department of Defense wished to have this matter deferred until a later date, representatives of the Department of Defense will be available whenever the Department of State desires.
It should be pointed out that the proposed release of these funds differs from the general practice and experience of the United States in such matters, and is not altogether consistent with previous actions which have been taken in other allied or liberated countries. Previous settlements have not distinguished between the use of currencies by individual members of the U.S. armed forces and currencies used for official purposes. Therefore, it would appear to be desirable to inform [Page 936] appropriate Congressional authorities of the release of the Korean suspense account.
Sincerely yours,
Colonel, USAF, Deputy Director
Executive Office of the Secretary