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Foreign Relations of the United States 1945-1950 Emergence of the Intelligence Establishment Department of State Washington, DC

From the Strategic Services Unit to the Office of Special Operations

                           

120. Letter From the National Intelligence Authority to Attorney General Clark

Washington, August 8, 1946.

//Source: Central Intelligence Agency Records, Job 83-00764R, Box 1, Folder 5. Secret. According to Wright's August 8 memorandum (Document 122) the letter was drafted by the Central Intelligence Group.

Dear Mr. Attorney General: Pursuant to authority contained in the President's directive of 22 January 1946,/1/ the National Intelligence Authority has directed the Central Intelligence Group to assume, by June 30, 1947, the intelligence coverage in Latin America that is now performed by the Federal Bureau of Investigation. The Director of Central Intelligence, by letter dated 3 July 1946,/2/ concurred in the offer of the Director of the Federal Bureau of Investigation to withdraw from Latin America provided Mr. Hoover was willing to postpone withdrawal until the Central Intelligence Group is adequately organized and staffed to arrange an orderly transfer with a minimum of interruption.

/1/Document 71.

/2/Document 113.

However, the Federal Bureau of Investigation has notified the Department of State and the Central Intelligence Group that its representatives will be withdrawn [less than 1 line of source text not declassified] by August 16, 1946. The Department of State has also received intimations that the Federal Bureau of Investigation is preparing to withdraw its representatives from the other Latin American countries prior to the time that the Central Intelligence Group will be able to replace them.

The attached tentative schedule/3/ indicating the dates by which the Central Intelligence Group is prepared to assume intelligence responsibility in the various countries of Latin America has today been furnished the Federal Bureau of Investigation. It is requested that the Federal Bureau of Investigation be instructed to retain its present personnel in the Latin American countries to which presently assigned until the Central Intelligence Group is able to assume responsibility. After the arrival of the representatives of the Central Intelligence Group, the Federal Bureau of Investigation staff must remain for an adequate period in order that the new organization can profit by the Bureau's experience in each country and in order that continuity of operation may be assured.

/3/Not printed; see the Supplement.

The Department of State is at present processing the papers of a C.I.G. representative who is now available to replace the F.B.I. man in [less than 1 line of source text not declassified] all other instances, it is imperative that no withdrawals be made until the C.I.G. has an opportunity to satisfactorily install their personnel.

We are certain that you appreciate the wisdom of this course of action and feel certain that it meets with the desire of the President of the United States.

The National Intelligence Authority:/4/

/4/Printed from a copy that indicates the original was signed by Acheson, Patterson, Acting Secretary Sullivan, and Admiral Leahy.

121. Memorandum From the Director of the Federal Bureau of Investigation (Hoover) to Attorney General Clark

Washington, August 8, 1946.

//Source: National Archives and Records Administration, RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Documents, Box 8, Folder 18. No classification marking.

I have been advised by Mr. Tamm of his discussion today with you relative to the letter addressed to you under date of August 8th and bearing the signatures of Messrs. Patterson, Acheson and Sullivan and Admiral Leahy, relative to the transfer of the intelligence functions performed by the Federal Bureau of Investigation in Latin America to the Central Intelligence Group./1/ I am addressing to you separately today a memorandum outlining in detail the developments with reference to this situation since the Central Intelligence Authority obtained a Presidential directive establishing itself as an operating unit in the collection of intelligence information, and General Vandenberg, pursuant to that directive, indicated his desire to take over the coverage of Latin American intelligence./2/ Mr. Tamm has advised me of your desire to agree to the tentative schedule for the transfer of intelligence functions to CIG in so far as it is practicable and possible, in view of your feeling that the President has undoubtedly approved the attached action recommended by Mr. Patterson and the co-signers representing the State and Navy Departments and the White House./3/

/1/Document 120.

/2/Dated August 8; not printed. (National Archives and Records Administration, RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Document, Box 8, Folder 18)

/3/Document 120.

It is noted that this schedule proposes that the Central Intelligence Group will take over the coverage of designated Latin American countries on February 15, 1947, will take over a second group on April 1, 1947, and the balance of the Latin American countries on May 15, 1947. If you insist on my complying with this schedule, I will, of course, have no alternative but to agree to it. I desire to point out to you, however, that I had anticipated insisting with General Vandenberg that the Central Intelligence Group take over the first group of offices on September 15, 1946, a second group on November 1, 1946, and the balance of the Latin American offices on January 1, 1947. I contemplated this action in order, first, to return to the domestic service of the FBI as promptly as possible the experienced Bureau Agents who have been operating the intelligence service in South America. It is unnecessary for me to point out to you again the dire need which the Bureau has at this time for special Agents, and I feel that since the Central Intelligence Group desired to take over the Latin American coverage, the sooner the Bureau Agents return to their domestic duties, the better off the Bureau will be.

Since my representatives in Latin America know of the contemplated program of General Vandenberg--the State Department has already advised all of its Latin American Ambassadors of the proposed CIG program--it is a matter of considerable difficulty to keep the interest of the Bureau personnel in Latin America at an efficient level. Since these men know that their assignments as intelligence agents in South America will shortly terminate, they rapidly, as a matter of human nature, lose interest in a job which they consider is now finished and their interests naturally turn to their new assignments and responsibilities in the United States. I feel, consequently, that the quality of the Bureau's performance in Latin America will probably decline because of the diminishing interest on the part of Bureau Agents in these assignments. I think that in the interest of efficiency it is highly desirable to transfer these men to their new duties and the duties in which their interests will now lie as soon as possible. I think, conversely, it is highly desirable, since the CIG desires to go into the Latin American field, that they take over their responsibilities as soon as possible.

A third element which enters into a decision upon this subject is the fact that undoubtedly, and despite their assurances to the contrary, the Central Intelligence Group, will definitely endeavor to proselyte Bureau personnel presently serving upon intelligence assignments. The Bureau's representatives in the Latin American field are men of outstanding qualifications with exceptional backgrounds and they have performed very meritorious service in the Latin American field. It is logical to assume that the Central Intelligence Group will endeavor to secure the services of these people. I feel that the sooner the Bureau brings these people back to the United States, the less danger there is of the Bureau's losing the services of experienced personnel, which it so vitally requires in the domestic field at the present time.

I do not believe that the General Vandenberg group can contend that they are unable to take over the Latin American intelligence duties until next year because of their inability to obtain personnel. Certainly when the Bureau was instructed to establish a Latin American intelligence service, no latitude was allowed for any extended period of personnel recruitment and the Bureau virtually overnight placed in the Latin American countries an operating, efficient intelligence service. A recent organization chart of the Central Intelligence Group indicated that a staff of some 90 persons is presently assigned at the seat of Government in Washington. This staff is about tenfold that which the Bureau has utilized to operate a Latin American intelligence service. In addition, I have been informed that the personnel investigative division of the Central Intelligence Group has been investigating about 187 applicants for positions each month. Recently General Vandenberg advised the National Intelligence Authority that he contemplated having the services of 3,000 people in his organization by the end of the current fiscal year, of whom 1900 would be engaged in secret intelligence. General Vandenberg advised that in addition to the $12,000,000.00 made available to him for the fiscal year 1947, he would need $10,000,000.00 for his operations during the current year and expressed the view that he might have to secure an independent budget rather than operate from funds made available by the State, War and Navy Departments. It seems to me, consequently, that the Central Intelligence Group is not confronted with any personnel problems and apparently is financially able to carry on their operations. I think it is rather interesting to note that when the Federal Bureau of Investigation prepared an estimate for a worldwide intelligence system, we contemplated the use of 650 Agents at an annual cost of about $10,000,000.00 a year.

I feel, consequently, that the Central Intelligence Group should be required to take over the Latin American intelligence in three stages--taking over the first group of offices in their proposed schedule on September 15, 1946, the second group on November 1, 1946, and the final group on January 1, 1947. While I, of course, will do whatever you desire in this situation, I do want you to know that I feel very strongly that the Central Intelligence Group, having sought the coverage of intelligence in the Latin American field, should be required to assume promptly the responsibility for this coverage.

I am returning herewith the original letter addressed to you by Messrs. Patterson, Acheson, Sullivan and Leahy and the attachment referred to therein.

122. Memorandum for the Record

Washington, August 8, 1946.

//Source: Central Intelligence Agency Historical Files, HS/CSG-2227, Job 83-00739R, Box 2, Folder 3. Top Secret. Although the memorandum is dated August 8, it was obviously amended later, since the postscript refers to developments on August 10.

Late in the afternoon of 6 August 1946, the Office of the Secretary of State requested a meeting of NIA to be held on 7 August 1946./1/ The purpose of the proposed meeting was to air the danger involved in pulling FBI operatives out of Central and South America prior to the time CIG was prepared to take over--and to come to necessary decisions in the matter. At the time of calling the meeting, the State Department requested we prepare a memorandum for NIA, outlining our actions to date in this regard and indicating our time schedule for taking over Central and South American activities.

/1/See Document 117.

The NIA meeting was held on the morning of 7 August/2/ and our memo/3/ was submitted by Colonel Galloway. All NIA members were adamant in the necessity for FBI to remain operative in the area until he took over and in the necessity for an overlap of operatives in order to preserve continuity.

/2/Document 118.

/3/Dated August 7. (Central Intelligence Agency Historical Files, HS/CSG-2227, Job 83-00739R, Box 2, Folder 3) See the Supplement.

The meeting was brief, spearheaded by Admiral Leahy. The Secretary NIA was directed to prepare a letter to the Attorney General, requesting that FBI be directed to retain their operation in the subject area until we were fully operative. The Secretary was also directed to draft a letter to the Attorney General, to be signed by the President, for use in the event no action was taken by the Attorney General on the letter from NIA.

The NIA letter to the Attorney General was prepared by us on 7 August, signed by all members of NIA, and dispatched on the morning of 8 August 1946./4/ The draft of the Presidential letter/5/ has been approved by all members of NIA and is being retained for later use if necessary.

/4/Document 120.

/5/Document 119.

E. K. Wright
Colonel, GSC
Executive to the Director

On Saturday, 10 August, I was called to the office of Admiral Leahy and informed that the Attorney General had agreed to take steps providing that FBI personnel did not move out of Latin American areas until CIG could replace them with proper operatives and until there was a reasonable overlap of time between the arrival of CIG personnel and the departure of FBI personnel./6/ Admiral Leahy also stated that Mr. Clark was anxious that CIG take no steps toward the employment of FBI personnel in Latin American areas as this personnel were all trained operators and were needed in the domestic field.

/6/See Document 123, which gives an account by Hoover's assistant of the Attorney General's August 10 meetings with the President and Admiral Leahy.

123. Memorandum From the Director's Assistant (Tamm) to the Director of the Federal Bureau of Investigation (Hoover)

Washington, August 10, 1946.

//Source: National Archives and Records Administration, RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Documents. No classification marking.

Pursuant to your instructions, I talked to the Attorney General this morning at his request with reference to the SIS situation. He stated that he had been to the White House yesterday and that he spent almost two hours talking to the President about this situation. Prior to the time that he talked to the President, Admiral Leahy had talked to the Attorney General/1/ and had indicated to him that it was desired that the Department of Justice through the Bureau render every possible assistance to the CIG in taking over the SIS work in South America. Admiral Leahy indicated that the CIG would not be able to move into any of the countries as rapidly as the Bureau desired to withdraw from them but that the State Department desired to insure a continuity of coverage and that, consequently, the Bureau should only withdraw upon the basis of a harmonious schedule with CIG moving in to take over the various countries.

/1/No record of these conversations with Clark has been found.

The Attorney General stated he talked to the President about this situation and the President indicated some doubt that the CIG would work but the President stated he had to at least try it out in view of the recommendations made to him by his Cabinet members. The Attorney General advised him that Ambassador Pawley, Spruille Braden and various other State Department representatives were very much opposed to FBI withdrawing but the President thought the FBI should coordinate its program in such a way that CIG could move in on an orderly basis and take over the operations. The Attorney General desired, therefore, that the Bureau arrange through appropriate conference with CIG so as to insure that our withdrawal would be upon the basis of CIG's ability to move in and take over the operations in various countries.

I advised the Attorney General that while you had not so stated in your recent memorandum,/2/ you had instructed me to advise him orally that the CIG was definitely stalling in this situation. I pointed out to him that it was rather inconsistent that Bureau Agents were not good enough to carry on the SIS operations in the Latin Americas but at the same time their services are so indispensable that they cannot now be withdrawn or replaced. I told the Attorney General that the CIG had a bright group of alleged intelligence representatives, including a number of men who had deserted from the service of the FBI during the war, who appeared, according to CIG estimates, at least capable of carrying on the SIS operations. I stated that as a matter of fact General Vandenberg had the effrontery to designate as his representatives to confer with the Bureau on the change-over of operations ex-FBI Agents who had deserted from the Bureau service while on foreign assignment and who were definitely persona non grata to you and to the Bureau.

/2/Presumably Document 121.

The Attorney General was advised that you had instructed that we be entirely reasonable in attempting to work out a schedule for the transfer of SIS duties but that from the schedule submitted by CIG, it was very obvious that CIG was stalling and the dates set by them were unreasonable. I told him that you had, upon the basis of my previous conversation with him in which he expressed the desire to support the President in getting this plan set up and in operation, instructed that we make reasonable concessions to the CIG in an effort to bring about a reasonable schedule for the transfer of duties. I pointed out to the Attorney General that the withdrawal of individual personnel, such as the withdrawal of the Legal Attaché in Brazil, did not indicate that the office was being closed but that this was an administrative transfer of an individual Agent predicated upon a reduction program which you had outlined subsequent to the termination of the war. I told the Attorney General that there were some 25 or 30 men currently under transfer back to the United States but that these transfers had nothing to do with the change-over of the SIS coverage to CIG, but rather were routine transfers which would have been effected even though the Bureau remained in SIS. I told the Attorney General you desired him to have this information in the event any question were raised about the recall to the United States of any individual Agent.

The Attorney General stated that he desired to make reasonable concessions to CIG in permitting them to take over the intelligence coverage and stated he desired me to talk to Admiral Leahy and outline to him the Bureau's problem and its position with reference to these problems. I suggested to the Attorney General that, in the light of the information which I had furnished to him, he might desire himself to talk to Admiral Leahy and indicate that we would go along in anything that was reasonable in the light of all the circumstances, but the Attorney General stated he believed it would be better if a Bureau representative conferred direct with Admiral Leahy. He stated he would call Admiral Leahy and arrange an appointment and asked that I let him know how we made out with Leahy.

The Attorney General indicated that he told the President that it was anticipated that CIG would try to proselyte the Bureau's personnel and the President said that of course he would not tolerate anything of that kind and if it became necessary, he would issue an order to CIG prohibiting them from hiring FBI people.

124. Memorandum From the Director of the Federal Bureau of Investigation (Hoover) to Attorney General Clark

Washington, August 12, 1946.

//Source: National Archives and Records Administration, RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Documents. No classification marking. A typed note on the source text indicates that it was sent at 5 p.m. on August 12. This memorandum from Hoover is based on a longer August 12 memorandum from Tamm to Hoover. (Ibid.) See the Supplement.

Pursuant to the appointment arranged by you with Admiral Leahy, Mr. Tamm consulted with the Admiral this morning. Admiral Leahy was informed that I was endeavoring, in accord with your desires, to assist in every practical way to arrange for the transfer of the Latin American coverage to the Central Intelligence Group but that there were certain elements and factors about which it was felt Admiral Leahy should be advised. He was informed that some months ago, in accord with your authorization, I had drawn up a schedule for a worldwide intelligence service under the Bureau's direction, which contemplated the use of some 650 agents, at an annual cost of ten million dollars, with the cost of operation concealed within the Bureau's appropriation to avoid publicity with reference thereto. It was pointed out that this plan had not been acceptable, but that the Bureau had, after the Central Intelligence Group was established, been virtually evicted from South America.

Admiral Leahy was informed that when General Vandenberg was asked whether he desired to take over the Latin American coverage, he stated that he did desire to do so, but when I had attempted to initiate a program of withdrawing the FBI staff from South America, this withdrawal had been opposed except on an unacceptable long-term basis. It was pointed out to the Admiral that this placed the Bureau in a position where its Agents were not good enough to remain in South America but at the same time their services were, at least at this time, indispensable. It was pointed out to Admiral Leahy that it is impossible to maintain the morale and efficiency of the Bureau Agents on Latin American assignments on a high basis due to the fact that their interest was bound to lag in the knowledge of their pending return to domestic responsibilities, and that as a result the whole spirit of the Bureau's SIS Division was bogging down.

Admiral Leahy was advised that the Bureau had, upon Mr. Roosevelt's direction, placed in operation in Latin America virtually overnight an efficient intelligence service. In answer to Admiral Leahy's question as to whether it is impossible for the Central Intelligence Group to obtain an adequate operating staff, the Admiral was advised that while this program might be somewhat difficult, it was not impossible as evidenced by the fact that the Bureau had done it under the difficulties of wartime pressure.

It was pointed out to Admiral Leahy that while Bureau Agents were apparently not good enough to continue in the Latin American intelligence field, the persons designated by General Vandenberg to work with the Bureau in turning over the SIS responsibilities to the Central Intelligence Group were ex-FBI Agents who had deserted the Bureau service in time of war for personal reasons and were definitely persona non grata to the Bureau.

Admiral Leahy indicated that it was President Truman's desire to establish a worldwide intelligence service and to relieve the Bureau of all of its foreign responsibilities in the interest of enabling the Bureau to discharge its domestic responsibilities. He stated that the President and he were of the opinion that the Bureau should continue to maintain agents in any part of the world deemed necessary for the facilitating of the discharge of the Bureau's domestic responsibilities.

Admiral Leahy was advised of the fact that many of the Latin American Ambassadors are protesting against the withdrawal of the Bureau but that I would not permit our agents to plan with them any program of opposition.

To summarize the Bureau's overall position, Admiral Leahy was informed that I am making every effort to coordinate the Bureau's program of withdrawal with CIG's program of taking over, but that I was convinced that the CIG was stalling. Admiral Leahy is of the opinion that General Vandenberg and his group are stalling and indicated that he would take this entire matter up with General Vandenberg upon the latter's return to the United States in order to facilitate, expedite and clarify this situation. The Admiral was assured that the Bureau has no desire to be arbitrary or stubborn in this situation but will do everything possible to bring about an expeditious clarification of the entire change-over program.

Respectfully,

John Edgar Hoover/1/

/1/Printed from a copy that bears this typed signature.

125. Memorandum From the President's Chief of Staff (Leahy) to the Director of Central Intelligence (Vandenberg)

Washington, August 12, 1946.

//Source: National Archives and Records Administration, RG 218, Records of the Joint Chiefs of Staff, Leahy Papers, No. 131. Secret.

August 12th Attorney General Clark sent Mr. Tamm of F.B.I. to see me in regard to providing reliefs for the F.B.I. intelligence agents now in Latin America./1/ The Attorney General wishes that the provision of National Intelligence Agents be expedited as much as possible and the President wishes us to comply.

/1/See Document 124.

F.B.I. needs its agents for work here within the United States.

Positive objection was expressed to our having sent ex-F.B.I. men to discuss our common problems with F.B.I.

It would appear advantageous for the Director of C.I. himself to make all contacts with Mr. Hoover, and that ex-F.B.I. men now in the C.I. Group should certainly not be used for such contacts.

Granting that there will be a temporary reduction of efficiency by an early relief of F.B.I. agents in Latin America, it is my opinion that the reliefs can be accomplished at a much earlier date than as at present scheduled and that it should be done.

It is certain that we should not employ in the C.I.G. any persons now in F.B.I., and it is my opinion that to avoid offending Mr. Hoover we should not hereafter, without specific approval in each instance by the Authority, employ any persons who at any time separated themselves from F.B.I.

William D. Leahy/2/

/2/Printed from a copy that bears this typed signature.

Continue with Document 126