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If the policy expressed in the last sentence of the second paragraph of the letter which I will read later is to be that of the administration and some Members of our Congress, one wonders how much longer it will be possible to prevail upon men to fight for this country. In addition, I know of no better argument the Communists can use to obtain followers than to tell the orphans of the above-mentioned officer that their father fought for this country, that he was sacrificed to save England and Russia, that as a result he became a prisoner of war and died in a Jap prison camp due to neglect and abuse, that now our Government has decided his life savings, confiscated by his captors, must be contributed to the enemy who killed him.
You no doubt wonder what my personal interest is in this matter. First, I informed this officer what General MacArthur told me, and the man believed his funds would not be lost.
Second, I had $213.76 in the Philippine Trust Co. After the approval of the Japanese Peace Treaty in 1952, I considered this money lost and dropped it on my income-tax return. Apparently, that action has been approved. I fail to see how I will benefit very much by the passage of this bill.
I do sincerely hope that the members of this subcommittee will recommend a favorable report on H. R. 6407 and will exert every effort to secure a prompt passage of the bill.
Now, as to the letter to General Devereux from Mr. Jack McFall, Assistant Secretary of State, dated August 27, 1951; it is as follows:
Reference is made to your letter of August 16, 1951, regarding certain provisions of the Japanese Peace Treaty. Receipt of this letter in the Department was acknowledged by telephone on August 21.
There is attached a copy of the treaty of peace with Japan which is to be offered for signature at the Conference at San Francisco. Article 15 (a) of the treaty provides for the return of the property of each Allied Power and its nationals if such property was within Japan at any time between December 7, 1941, and September 2, 1945, unless the owner has freely disposed thereof without duress or fraud. This article also makes provision for compensation in cases where such property was within Japan on December 7, 1941, and cannot be returned or has suffered injury or damage as a result of the war.
In view of the limited resources available to Japan, it has not been considered feasible to extend the compensation provision to property losses which occurred outside Japan, including private bank accounts of servicemen in the Philippine Islands which were confiscated by the Japanese after the surrender of the islands in 1942.
That, to me, is the gist of the letter. If you desire me to read the remainder
Mr. HINSHAW. We will accept it for the record. You think the balance of it is not particularly applicable to this question, do you?
General BLUEMEL. Yes, sir.
It is signed "Sincerely yours, Jack K. McFall, Assistant Secretary, for the Secretary of State." (Letter referred to is as follows:)
DEPARTMENT OF STATE,
Washington, August 27, 1951. MY DEAR MR. DEVEREUX: Reference is made to your letter of August 16, 1951, regarding certain provisions of the Japanese Peace Treaty. Receipt of this letter in the Department was acknowledged by telephone on August 21.
There is attached a copy of the treaty of peace with Japan which is to be offered for signature at the Conference at San Francisco. Article 15 (a) of the treaty provides for the return of the property of each Allied Power and its nationals if such property was within Japan at any time between December 7, 1941, and September 2, 1945, unless the owner has freely disposed thereof without duress or fraud. This article also makes provision for compensation in cases where such property was within Japan on December 7, 1941, and cannot be returned or has suffered injury or damage as a result of the war. In view of the limited resources available to Japan, it has not been considered feasible to extend the compensation provision to property losses which occurred outside Japan, including private bank accounts of servicemen in the Philippine Islands which were confiscated by the Japanese after the surrender of the islands in 1942.
In connection with the drafting of the peace treaty, the Department has given serious consideration to a wide variety of claims by nationals of the United States and its allies against the Japanese Government. The problem of providing compensation from Japanese resources for the various public and private claims arising out of the war is a very difficult one, particularly since the extensive losses of life and property and personal injuries suffered by our allies must be considered on the same footing as our own insofar as compensation by Japan is concerned.
Since the end of World War II it has been necessary for the United States to supply economic assistance to Japan to the extent of nearly $2 billion because of Japan's inability to earn from sale of her exports sufficient foreign exchange to supply even the minimum needs of her population for food and other necessary imports. The furnishing of aid to Japan has been considered essential to the basic goal of the United States with respect to Japan, namely that Japan achieve political and economic stability and become a peaceful and self-supporting member of the international community oriented toward the democratic countries of the world. A requirement that Japan pay compensation for war losses out of her inadequate foreign exchange resources would consequently involve the imposition of a burden on the United States taxpayer and would constitute a barrier to the achievement of stability and self-support in Japan.
The War Claims Commission, established under the War Claims Act of 1948 (Public Law 896, 80th Cong., 2d sess.), was directed by Congress to inquire into and report to the President for submission of a report to the Congress, with respect to war claims arising out of World War II, including recommendations concerning methods for dealing with such claims. The first report of the Commission was forwarded by the President of the Congress on May 3, 1950, but, as pointed out in the report, sufficient time had not been provided for completion of the work required of the Commission. It is understood that the Commission is presently engaged in the preparation of a further report which will contain comprehensive recommendations of the character contemplated by Congress in establishing the Commission. Sincerely yours,
JACK K. McFALL,
(For the Secretary of State). General BLUEMEL. I would like to make a few additional comments, if I may. I have supporting documents here which I will be glad to turn over, which substantiate what I have said in my statement. The reason I have brought with me these documents is that I would like the committee to understand that we members of the armed services have not come here as a first affair, that I personally have made every reasonable effort to secure this money from some other source and have met with no success whatsoever. If
you desire me to quote the pertinent parts of each of these documents, I shall be glad to do so, or I can hand them over just to go into the record.
Mr. HINSHAW. I think that the committee would be interested to know what the documents consist of and the general purport of tho documents. Then they may decide as to whether or not they should be included in the record of this hearing.
General BLUEMEL. All right, sir.
The first one was a statement from the Judge Advocate General of the Army. We were permitted, when we first came back, to make claims for properties lost, and the Judge Advocate General of the Army decided that money on deposit in a bank
Mr. HINSHAW. Just a moment, General.
Would you give the date of that and the military reference so that it could be checked in the files ?
General BLUEMEL (reading):
Headquarters, Army Service Forces, Office of the Judge Advocate General, Washington 25, D. C., Claims for Money on Deposit in Philippine Banks, JAGO, January 23, 1946.
Money on deposit in the bank is not property within the meaning of the applicable statute and regulations. It is legal obligation or indebtedness owed to the depositor by the bank. This obligation is a continuing one, which the depositor may enforce when conditions permit.
While some of the banks doing business in the Philippines are yet not open for their purpose of accepting deposits and permitting withdrawals, this office is advised that all banks are open for the purpose of answering inquiries of depositors with respect to their accounts.
Accordingly, if the claimant has not already done so, it is suggested that a letter of inquiry be addressed directly to the bank requesting information as to the status of the account on December 31, 1941, and as to the forms and procedure of asserting the claim.
During the Japanese occupation of the Philippines, the accounts of all hostile nationals in banks incorporated under the laws of the Philippines were ordered transferred to the Japanese controlled bank of Taiwan, Ltd. In the event inquiry discloses that the account was so transferred and the bank now refuses to honor the account, it is suggested that a letter be written to the United States High Commissioner, to the Philippine Islands, Manila, giving a complete statement of facts concerning the account and request information as to the procedure.
In other words, it said write to the High Commissioner and he would interest himself in the case. It is signed by the Chief of the Claims Division of the Judge Advocate General of the Army.
I will turn this over to go in the record. Mr. HINSHAW. We will put that entire letter in the record, General. (The letter referred to is as follows:)
HEADQUARTERS, ARMY SERVICE FORCES,
OFFICE OF THE JUDGE ADVOCATE GENERAL,
Washington 25, D. C. (JAGO January 28, 1946). Claims for money on deposit in Philippine banks.
1. Claims filed under the Military Personnel Claims Act of 1945 and AR 25–100, May 29, 1945, have included items consisting of deposits in Philippine banks. Inquiries have also been received as to the manner of presenting claims for deposits in Philippine banks.
2. Money on deposit in a bank is not property within the meaning of the applicable statute and regulations, but is a legal obligation or indebtedness owned to the depositor by the bank. This obligation is a continuing one which the depositor may enforce when conditions permit.
3. While some of the banks doing business in the Philippine Islands are not yet open for the purpose of accepting deposits and permitting withdrawals, this office is advised that all banks are open for the purpose of answering inquiries of depositors with respect to their accounts. Accordingly, if the claimant has not already done so, it is suggested that a letter of inquiry be addressed directly to the bank, requesting information as to the status of the account on December 31, 1941, and as to forms and procedures for asserting claim.
4. During the Japanese occupation of the Philippines the accounts of all "hostile” nationals in banks incorporated under the laws of the Philippines were ordered transferred to the Japanese controlled Bank of Taiwan, Ltd. In the event inquiry discloses that the account was so transsferred and the bank now refuses to honor the account, it is suggested that a letter be written to the United States High Commissioner to the Philippine Islands, Manila, giving him a complete statement of the facts concerning the account and requesting advice as to the procedures which should be followed to realize upon the claim. It is understood that the High Commissioner is taking an active interest in the situation created by the Japanese manipulation of bank accounts and that claimants who place their claims of record with the High Commissioner's office will be advised of the procedure to be followed as soon as such a procedure can be worked out.
RALPH G. BOYD,
Chief of Claims Division
(For the Judge Advocate General). General BLUEMEL. I wrote a letter, too, in compliance with that, to the banks. The reply is Philippine Trust Co., Manila, Philippine Islands, dated June 19, 1946, and it is addressed to me. I was then still on active duty.
We are in receipt of your letter of June 4, 1946. In reply, we wish to inform you that the checking account you had with us with a balance of 427 pesos and 53 centavos, was among the accounts of Americans, Britishers, and Dutch nationals transferred by the Japanese to the Bank of Taiwan, Ltd., on September 29, 1944.
It is the policy of the Philippine Government, in reopening banks—our bank was reopened on March 11, 1946—not to consider the transferred accounts as deposit liabilities of the bank from which they were transferred. However, a case was brought by an American against the Philippine National Bank regarding them and the trial court held the bank liable for the transfer. The case was appealed to the Supreme Court but until now no final decision has yet been rendered.
For your further information, we wish to mention that a new angle on this matter was developed recently. President Roxas in his address to the Philippine Congress on June 3, 1946, suggested a method to be pursued by that lawmaking body so that the banks concerned may attend to these accounts in the same way that they are attending to those that were not transferred by the Japanese. It is hoped an early legislation, based on the recommendation made by the President, will finally define the status of these transferred accounts. Very truly yours,
E. F. FORD, President. Mr. HINSHAW. Thank you, General.
General BLUEMEL. I carried on some more correspondence. I wrote to the High Commissioner, who was Paul V. McNutt at the time. I think I have a copy of the reply here. It was a very courteous reply.
Mr. HINSHAW. I suggest, General, as you originally suggested, that much of this be placed in the record. It is a matter of sequence arriving at no conclusion; is that not correct?
General BLUEMEL. All right, sir, if you will do it that way I will be glad.
Here is another dated March 23, 1948. This is about 2 years later, where he acknowledges receipt of my letter and says:
The recommendations of President Roxas included in his message to the Philippine Congress on June 3, 1946, that something had to be done to reestablish those transferred deposits, was not needed by that body.
So the Philippine Congress apparently paid no attention to the President's recommendation.
That is signed by Clifford R. Castro, vice president of the bank. Mr. HINSHAW. That will be placed in the record. (Letter referred to is as follows:)
PHILIPPINE TRUST Co.
Manila, Philippine Islands, March 23, 1948. Mr. CLIFFORD BLUEMEL,
Trenton, N. J. DEAR SIR: This will acknowledge receipt of your letter dated February 24, 1948.
We regret to state that in spite of all our efforts to date to assist the parties affected in establishing their rightful claims, all transferred deposits have not yet been returned to us and, consequently, could not be reestablished in our books. The recommendation which President Roxas included in his message to the Philippine Congress on June 3, 1946, that something had to be done to reestablish those transferred deposits, was not heeded by that body.
Further, we wish to inform you that the issue involved in these transferred deposits which has been brought up in a suit filed by the Everett Steamship Corporation v. the Bank of the Philippine Islands (Civil Case No. 120, C. F. I., Manila), has been decided in favor of the plaintiff. However, we were informed that the defendant appealed this case to the Supreme Court, and we regret to state that to this date, no decision has been handed down by the Supreme Court on the case involved.
We quite realize the situation in which our former depositors find themselves, but we wish to assure you that to date, we have done all that is necessary for the best interest of our former depositors. Yours very truly,
CIPRIANO B. CASTRO,
Vice President. General BLUEMEL. Now, the American Embassy, Foreign Service of the United States, Manila, Philippines, July 25, 1946. This is the letter I told you that I wrote to the High Commissioner in compliance with the first advice. He states: Your attention is directed to the following statement
That is just a repetition of the others, but I am trying to show that I exhausted every reasonable method that I knew before we went to the Congress of the United States on the thing; if you will please put that one in the record.
Mr. HINSHAW. That letter will be accepted for the record.
Manila, Philippines, July 25, 1946. Brig. Gen. CLIFFORD BLUEMEL,
Camp Ellis, I11., U. S. A. DEAR GENERAL BLUEMEL: Reference is made to your letter of July 12, 1946, concerning your prewar account with the Philippine Trust Co. which was transferred to the Bank of Taiwan during the Japanese occupation. We are happy to inform you that the Philippine Government is now considering various proposals to reimburse American citizens whose accounts were transferred.
Your attention is directed to the following statement made by President Roxas in his message to the Philippine Congress on June 3, 1946:
“Meanwhile, further to increase the general confidence in banks, we must enact legislation for deposits made prior to the war and transferred by the Japanese to the Bank of Taiwan and the Yokohama Specie Bank. These transfers affected Americans, allied nationals, and loyal Filipinos. Funds affected also include trust funds held for widows and orphans in the Philippines of American soldiers of past wars. Proper claims can be made by the banks against the Japanese Government, but meanwhile depositors must be protected.”
We are anticipating early action on this matter. It is assumed that your bank will inform you when final action is taken by the Philippine Government. Respectfully yours,
HAROLD J. HOFLICK,
(For the Ambassador). General BLUEMEL. I realized this thing might come to a head in 1953, so I wrote again to the Philippine Trust Co., and I have another reply dated January 28, 1953, in which he acknowledges that my account amounted to so much money, and “we wish to advise that they filed claim." And still we get nowhere.
So you can see that up to 1953 the status is practically the same. I have a thick file on the subject, and I merely picked out what I