In cases where it appears that the granting of a license by the Bureau of Enemy. Trade would be advantageous to the Alien Property Custodian in the administration of a trust, the division administering advises the reporter to make application for license, at the same time advising this department of its action. The department thereupon. advises the Bureau of Enemy Trade of the attitude of the Alien Property Custodian. Likewise when it appears that revocation or modification of an existing license would be advantageous to the Alien Property Custodian's administration, this department, upon being similarly advised, takes up the matter with the Bureau of Enemy Trade for such revocation or modification. STOCK AND BOND DEPARTMENT. The functions of this department are as follows: Appraising stocks, bonds, promissory and collateral notes, etc., appearing on the inventories sent to the department by the Depositary and Inventory Department, and afterwards returned there. Recording and cross-indexing on the department's books and cards all the above items, so as to show full and complete list of securities in each report and trust, and also the total amount of the various kinds and classes of these securities, where held, and for whose account. The collecting of data such as capitalization, dividend and interest, and payments, sinking fund notices, reorganizations, exchanges, etc., on the various securities, and the issuing companies, so that the work of the depositaries may be intelligently checked up and supervised. Furnishing the various divisions and others entitled quotations and general information relating to these securities. Keeping an income record of all stocks, bonds, and notes, held by the depositaries, and checking up their quarterly reports, to see that everything necessary has been done, and done properly. These quarterly reports are sent to this department by the Division of Accounts and returned to that division after the department has verified them. The department is thoroughly equipped with the various statistical manuals, and card and news services, and is regularly supplied with the necessary financial papers and sales and quotation sheets from the principal stock and bond exchanges. REAL ESTATE AND MORTGAGE DEPARTMENT. This department furnishes to the Bureau of Trusts, and the various divisions therein, practically the same information regarding real estate and mortgages as the Stock and Bond Department does regarding securities. It supplies the official appraisal for all items coming under the general head of real estate and mortgages, keeps a record of such property, and checks up the work of the depositaries, pertaining to this class of property. Where it is necessary to obtain information regarding real estate, inquiries are, as a rule, sent to the Real Estate Board nearest the actual location of the property, and they are asked to supply this information or to suggest some reliable party who can. In the case of mortgages, an inquiry blank is sent to the depositary who sees that the information requested is obtained, and returned to this department, where it is cross-indexed and filed. The real estate taken into custody involves properties located in 42 States, belonging approximately to 1,200 enemies. Most of the properties are located in cities and industrial centers, and only a small portion is located in rural and farming districts. In the main, the properties were acquired by inheritance, and only a small amount appears to have been held by enemies for investment purposes. The aggregate value of real estate demanded and inventoried amounts to approximately $7,500,000, and it is fair to assume that when all reports have been returned to this department, the value will exceed $12,000,000. It has been the general policy of the Custodian not to sell real estate unless it is necessary to prevent waste and protect the interests of the Government. The management of all real estate taken into custody is placed with depositaries with instructions to keep the improved property in good repair, that the property shall be leased and rents collected by them, insurance maintained to the full protection of the property, and interest upon outstanding mortgages and taxes paid. All expenditures, however, must be made from funds derived from the trusts. DEPOSITARY AND INVENTORY DEPARTMENT. The work of this department is under two sections. That of the depositary section is to designate depositaries for all enemy property demanded, except money or other cash items. That of the inventory section is to secure inventories of such property. Wherever a depositary is designated, an inventory of the property demanded is to be received from it, except in continuing trusts, in which the corpus remains in the hands of the fiduciary, and the depositary receives only money or other property if and when distributed by the fiduciary. The steps taken by this department are, successively: Designating depositaries under the supervision of the managing director; checking recommendations of the Bureau of Trusts for Depositaries to see if a depositary has already been designated for other property of the same enemy; in cases of new depositarics designated, sending general designation and a qualifying bond for execution, together with a copy of the Trading with the Enemy Act, and of the Manual of Instructions to Depositaries; execution of a specific designation to the depositary in each trust; correspondence with depositaries relating to designation, qualification, resignation, transfer of trusts from one to another, cancellation of trusts, and compensation of depositaries if not according to schedule of the manual; checking compensation of depositaries whenever charges are not in accordance with the schedule of the manual; entering on the records of the department inventories, upon receipt of them from Mails and Files, and the controlling of the inventory until finally checked and entered in the Division of Accounts and filed in the appropriate division; advising all divisions and departments affected by cancellation of trusts, transfer of trusts; and giving information to all divisions and departments whenever required. The depositary section has compiled and issued, for the use of depositaries, a Manual of Instructions to Depositaries, which is supplemented from time to time, as various rulings are made, by loose-leaf sheets which are to be appropriately inserted in the manual. The purpose of the manual is to answer the many questions that arise in connection with the duties of a depositary. The various steps are taken up in logical order, from the time a depositary is appointed, showing what is necessary to be done to comply with the requirements of the office of the Alien Property Custodian, and how this work can be handled most efficiently. In general, by carefully following the manual no further instructions will be needed by a depositary. If special problems, however, arise, they are handled by correspondence between this department and the depositary. The manual covers questions of appointment of depositaries; service of demands by them; their inventory and appraisal; matters relating to stocks, bonds, mortgages, and real estate; matters relating to taxes and assessments; the quarterly reports of depositaries, and their compensation. Under the provisions of the trading-with-the-enemy act, all money and cash items demanded and received by the Alien Property Custodian must be deposited forthwith in the Treasury of the United States. All other property taken possession of by the Custodian is deposited in banks and trust companies throughout the United States and in its insular possessions. Wherever a responsible bank or trust company reports enemy-owned property other than money, such bank or trust company is designated a depositary for such property and transfers such property from the account of the enemy to the account of the Alien Property Custodian. Where property is reported by others than banks and trust companies, a strong depositary is designated in the locality most convenient for the handling of such property. In selecting depositaries for property reported by individuals, preference is given to those institutions which are members of the Federal Reserve System. In cases of continuing trusts where a bank or trust company is the fiduciary, the same bank or trust company is designated depositary, and as fiduciary accounts to itself as depositary. For purposes of convenience, depositaries are required to make quarterly reports, accounting for all receipts and disbursements during the quarter and remitting the net balance, after deducting a reasonable commission, to the office of the Alien Property Custodian at Washington, where such funds are deposited in the Treasury of the United States. The cooperation and assistance of over 500 banks and trust companies throughout this country and in its insular possessions has made possible the quick and accurate handling of nearly $500,000,000 of property during the first year of the activities of the Custodian. If it had not been for such cooperation, it would have been necessary for the Custodian to maintain an enormous office, with a clerical force running into the thousands, and storage vaults of great magnitude. Under the conditions which have existed in Washington for a year it would have been impracticable, if not impossible, to have taken actual custody of the vast enemy properties which are now being administered by the Custodian. The depositaries are virtually branch offices and perform duties which are essential for the proper administration of nearly 25,000 active trusts which are already opened on the books of the Custodian. The services of the depositaries, which have been freely offered and loyally performed, have been especially valuable because of the knowledge and experience of their officers in the various parts of the country and in its insular possessions. A list of the designated depositaries on February 15, 1919, is contained in the appondix. Summary of work of the Bureau of Trusts at the close of business Feb. 15, 1919. 1. Number of reports filed with the bureau up to and including Feb. 15, 1919..... 2. Number of accepted trusts reported.. 3. Number of accounts opened..... 29, 114 32, 296 27,274 The following shows, under appropriate headings, the amount of property taken over to date by the Alien Property Custodian through this bureau: Amount of property of German subjects, in 17,479 trusts..... Total, 25,059 trusts..... Amount of property of Americans in Germany and Austria, in 648 trusts..... $330, 312, 988. 56 39,555, 557.34 369, 868, 545. 90 91, 866, 053. 40 Other property taken over (enemies in Bulgaria, Turkey, etc.), in 1,567 trusts... Total, 27,274 trusts..... Net income from Treasury investments... Property returned to claimants under section 9.. Grand total.... $40, 371, 354. 63 502, 105, 953. 93 839, 770.82 502, 945, 724. 75 1, 353, 024. 87 Summary. Cash deposited with the Secretary of the Treasury: Invested in Government securities. Uninvested... 504, 298, 749. 62 FEBRUARY 15, 1919. $71, 426, 001. 92 8, 015, 135. 70 Cash with depositaries. Bonds, other than investments made by the Secretary of the Treas ury.. Mortgages.. Notes receivable.... Accounts receivable.. Real estate........ General business, etc.. Total..... $79, 441, 137. 62 915, 381. 21 166, 969, 392. 47 60, 862, 354. 18 12,705, 542. 42 5,811, 933. 79 48, 727, 291. 57 10, 393, 505. 23 82,925, 496. 26 34, 193, 690. 00 502, 945, 724.75 |