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An alien property custodian system was established today by the U.S. Treasury to protect interests of 120,000 Japanese aliens and citizens and German and Italian aliens who will be evacuated by the Army from the vital Pacific Coast defense area.

Rep. John Tolan, heading the congressional committee investigating economic aspects of the evacuations, announced the treasury program.

The Federal Reserve Bank of San Francisco was placed in charge of protecting alien property. Branch offices were planned for all major centers of population in the evacuation belt. Aliens were advised to contact the Reserve Bank for information, instructions and protection.

In the case of agricultural properties, on which crops may be growing, the Treasury said attempts would be made to arrange for leasing or selling the property or for continuing attention to the growing crops with a view of preventing their loss.

Secretary [Henry] Morgenthau said particular attention would be given to “protection of the property of such persons against fraud, forced sales and unscrupulous creditors.”

“Obviously, the emergency will cause financial loss to the group involved,” Secretary Morgenthau stated. “However, the program is intended to accord this group reasonable protection of their property interests consistent with the war effort.”

The Federal Reserve Bank was given “full authority to act without reference to Washington,” although it was pointed out “over-all control of all aspects of the evacuation must obviously rest in the military authorities.”

Mr. Morgenthau predicted that “the established integrity and ability of the Federal Reserve Bank will enlist the confidence of all the affected groups and discourage gouging by creditors or other self-seeking interests.”

The bank was directed to work “in close liaison” with the Federal Security Agency, U.S. Department of Agriculture and other Federal, state and local agencies in dealing with the property during liquidation.

“These agencies,” Secretary Morgenthau went on, “will undoubtedly be called upon by the military authorities to handle other aspects of the evacuation problem, such as transportation and resettlement of the evacuees, and their re-employment in new areas.”

The Treasury Department, it was stated, “will furnish the Federal Reserve Bank by airplane with the requisite number of trained experts to assist in working out the details of the program in the field and to participate in its execution.”

It was revealed that John W. Pehle, assistant to Secretary Morgenthau, already is in San Francisco to help the Reserve Bank put the program into effect.

Although some details are yet to be worked out, an outline of the program follows:

“A. Properly staffed offices under the direction of the San Francisco Federal Reserve Bank will be opened at once in the local communities from which evacuees will be moved.

“B. Announcement will be made throughout the area by the Federal Reserve Bank of San Francisco that its representatives in these offices are prepared to assist evacuees with the problem of liquidating their property and protecting them against those seeking to take unfair advantage of their plight.

“C. Those representatives will assist in putting the evacuees in a position to obtain buyers, lessee, and others users of their property on fair terms. In cases where the evacuee is unable to select his own agent to dispose of his property the Federal (Reserve Bank) will be prepared to act as agent for the evacuee under a power of attorney or similar arrangement and take steps to liquidate the property on fair terms.

“D. Evacuees threatened by creditors will be encouraged to come to the representatives of the Federal (Reserve Bank) for advice and guidance. The Federal (Reserve Bank) representative will also discuss the matter with the creditor with the view of working out a fair settlement and limiting the remedies that may be pursued by the creditors who threaten unfair action. By and large the mere existence of this program of helping evacuees will eliminate or forestall most of the sharp practices that are now feared.

“E. In some cases the property of the evacuee may be such that its real value can only be realized at a future time; e.g. Japanese novelties. In such cases the bank’s representative will assist the evacuee in arranging for the storage of such property if that is the wish of the evacuee.

“F. On agricultural properties, the bank’s representative, with the assistance of representatives of the United Stated Department of Agriculture, will attempt to arrange for the leasing or sale of such property or if need be for the growing of the crops, with the view to preventing their loss through inattention.

“G. The Federal Reserve Bank of San Francisco and its representatives will be cloaked with adequate authority to cope with problems arising on the basis of existing circumstances. The program will be flexible and at all times the bank will attempt to keep matters on voluntary basis, satisfactory to the evacuee. When these efforts fail it may be necessary for the bank’s representative to step in and take the property over for the purpose of obtaining a fair and reasonable liquidation.

“It is expected that the setting up of this program and the accordance to the evacuees of facilities for the liquidation of their property should greatly expedite the departure on a voluntary basis of the evacuees from military areas.

“This program is being put into effect at the request of the secretary of war and will be carried out under the general direction of the local military authorities. Full authority has been delegated to the Federal Reserve Bank of San Francisco to carry out such a program.”

Additional announcements of evacuation plans, as well as the setting up of new military areas in interior states, was expected to be made soon by Lieut. Gen. John L. DeWitt, Western Defense Command and Fourth Army commander, and Tom C. Clark, Western alien co-ordinator.

A committee from the Japanese American Citizens League, which represents American-born Japanese, was to confer during the day with Federal authorities on evacuation plans. The league has been meeting here since Sunday.

First stopping place outside the military areas for Japanese who do not make their own removal plans (under Government supervision) will be in the Owens Valley, where the Army is establishing a reception center. There the Japanese will be classified as to occupation, and sent to resettlement colonies. Mr. Clark outlined the plan to the league yesterday.

He said the communities would have their own Japanese doctors and merchants and would be given protection by military authorities “or whatever authorities are established.”

Asked by a delegate if Japanese would have unrestricted movement within the communities Mr. Clark said such problems must be settled individually. He explained the “amount of protection” necessary in each community would determine the freedom of movement.

Mr. Clark added that the control policy would not seek to divide families and would not attempt to undermine “prevailing wage rates” by conscripting Japanese-Americans for labor gangs.

He praised the Japanese for self reliance and reported that only 140 families required Federal aid in evacuating areas under previous orders which forced 3000 aliens to find new homes.

Colonel W.F. McGill, provost marshal of the Western Defense Command, told the league that an Army proclamation also will be issued “very soon” designating new military areas in which evacuees will not be permitted to settle.

Nobumitsu Takahashi, agricultural co-ordinator for the league, submitted a report to the conference asserting that removal of the Japanese would disrupt the California vegetable industry. He reported that Japanese truck farmers produced crops valued at 40 million dollars annually and that the “stand to lose approximately 100 million dollars in investments.”

Meanwhile General DeWitt announced that farmers who destroyed crops would be arrested as “saboteurs.” He said aliens guilty of such action would be subject to internment and citizens to prosecution.

San Francisco News
March 10, 1942

Go to the Japanese Internment page.