761.5211/8–851
The Acting Attorney General (Ford) to the Secretary of State
My Dear Mr. Secretary: As you are aware, this Department has previously communicated with your Department concerning the advisability of requiring the Soviet Union to operate in the United States through a Commercial Attaché rather than through the Amtorg Trading Corporation. While I appreciate the position [Page 1634] taken by the Department of State in 19481 that the transfer of Amtorg’s activities to the Soviet Embassy might not be in the interest of commercial or industrial concerns in this country which continue to trade with the Soviet, it appears that the commercial aspects of this situation do not have the same significance at this time as they did in 1948 and that therefore the situation merits reexamination.
Reports recently submitted by the Federal Bureau of Investigation, copies of which have been furnished to your Department, reflect that the commercial activities of Amtorg have declined steadily in recent years. This is evidenced by the fact that the offices of Amtorg have been moved to much smaller quarters; the number of employees has decreased from 393 in November–December 1947 to 14 at the present time; the bank balances have decreased from seven to five figures, and there has been a marked decrease in the import and export business engaged in by Amtorg until the amount of trade now being handled by that corporation is but a small fraction of its previous volume.
The considerations which prompted earlier communications to the Department of State on this subject still obtain. Amtorg, of course, continues to provide an excellent cover for Soviet espionage activities. I feel, therefore, that the threat which Amtorg presents to the security of the United States as a whole outweighs the inconvenience which might be experienced by the few firms which still maintain trade relations with the USSR through Amtorg. In the circumstances I shall appreciate an expression of your views as to the desirability of requesting the USSR to take the necessary steps to effect a transfer of the activities of Amtorg to the Soviet Embassy in Washington.
Sincerely,
- In 1948 the Attorney General proposed to compel the Amtorg Trading Corporation, the official purchasing and sales agency of the Soviet Union in the United States, to register under the Foreign Agents Registration Act of 1938, as amended. In a letter of May 25, 1948, to the Attorney General, under reference here, the Secretary of State expressed the view that if Amtorg were compelled to register under the Act, the Soviet Government would dissolve Amtorg and handle its trade through the Embassy. It was the Secretary of State’s opinion that such a development would be detrimental to the best interests of U.S. firms doing business, but he did not wish to oppose prosecution of Amtorg if the Department of Justice were satisfied that the courts would rule in favor of the U.S. Government in the matter. (800.01B11–Registration/5–2548) Compulsory registration of Amtorg was successfully carried out during 1949; documentation on the matter is in Foreign Relations, 1949, vol. v, pp. 754 ff.↩