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Kay 2 , I9I4O Mr. I r a C l e r k , F i r s t Vie© President, Federal Reserve Bank o f San Francisco, San Franciaco, C a l i f o r n i a * Dear Mr. Clerks I r e c e i v e d t h e oopy of your l e t t e r of A p r i l 29th t o I4r. ilulroney. You w i l l r e c a l l t h a t along a t the end of the n e g o t i a t i o n s and a f t e r i t had been ^decided t o delegate the r e s p o n s i b i l i t y of v a l u i n g t h e c r i t i c i s e d banking practises t o a eocaaitteo, the bank proposed t h a t i t hare t h e r i g h t t o appeal t o t h e Coaqptroller from the d e c i s i o n o f t h e committee, but a f t e r sor.e discussion, the proposal was withdrawn. I n these circumstances, I b e l i e v e t h a t the C o m p t r o l l e r ' s o f f i c e w i l l be very r e l u c t a n t t o g i v e any i n s t r u c t ! o n s to Mr. Wright f o r f e a r t h a t subsequently t h e y might be charged w i t h not aoting i n good f a i t h i n c a r r y i n g out the agreement, and t h a t they w i l l m a i n t a i n a handa-off a t t i t u d e , l e a v i n g the matter of in^t e r p r e t a t i o n as w e l l as a p p l i c a t i o n o f the agreement e n t i r e l y to the committee. I r e a l i s e of course the d i s t i n c t i o n between i n t e r p r e t i n g t h e meaning o f the agreement and i n s t r u c t i n g the oommittee w i t h respeot t o what t h e i r f i n d i n g should be i n t h e case of a particular building. At the same t i m e , however, i t i s hard t o separate the two i n t h e present case and I p e r s o n a l l y t h e r e f o r e am i n c l i n e d t o be somewhat sympathetic w i t h t h e i r p o s i t i o n whieh I understand i s being forwarded t o you. On the o t h e r hand, my r e o o l l e c t i o n of t h e background of the agreement and of the discussion of t h e p a r t i c u l a r case i s i n e n t i r e aooord w i t h the statements i n your l e t t e r . I i n t e r p r e t the agreement as you do and have no reason t o b e l i e v e t h a t t h e Compt r o l l e r 1 s o f f i c e would t a k e a d i f f e r e n t p o s i t i o n * The f o r e g o i n g about sums up the s i t u a t i o n as I see i t and I hope w i l l be of some s l i g h t assistance t o you. Tours very t r u l y , J . P. D r e i b e l b i s , Assistant General Counsel*
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