CONTACT REPORT

Created: 11/25/1953

OCR scan of the original document, errors are possible

'I* HISTORICAL REVIEWg n SANITIZED Securliy

CONTACT

W^^J 53 PLACE: King's office

PERSONS PRESE;;T:

COVER USED: None Discussions r

serious impasse was described by JC as having developed withinDept.esult of the Under Secretary of State Cabot havingout of the PBSUCCESS picture. Apparently Cabot, desiring to seeis done in Guatemala, hasriefing from CIA as toplans are and what its current activities are, as Cabot wanteda program to attack the problem. In particular, he planned tomeeting of all coffee buyers to determine what could be done in As Cabot has not been cut in, he has never been officialyCIA's activities but he did evidence knowledge of certain things goingwhich he had not been informed. Allan Dulles,iscussion withlo talk to Bedell Smith at noon today regarding the possibilityCabot in, at leastimited degree, recognising that Smithconfidence nor personal liking for Cabot. Further, Allan Dulles

was to sneak tohis brother, John Foster Dulles, in an effort to resolve this raatter as Cabot insisted upon this briefing taking place on Monday,ovember, by J. c. King. Accordingly, an effort must be made by Allan Dulles to offset Cabot's intentions or to obtain approval to cut him in on PBSUCCESS tolash and possible serious compromise of PBSUCCESS to date.

stated he wanted to shipons of arms now in New Yorkjtoonce in order to test Somoza's alleged agreement to cooperate.strong exception to this proposal, pointing out that the entirehandling arms was fraught with peril from the security point of view

and great danger aa to control, owing to the possibility once the arms were in the hands of certain people they might go off on their own, thus aborting the program, it was explained that the new concept docs not necessarilyery large shipment of orras to Nicaragua but, contrarily, only that those actually required for training of the cadre classes at Pto. Cabe2as be shipped. Further, that the arms would be compartmented and would be delivered to various places in orden.to achieve maximum control and secrecy. ?he problem of getting arms from Nicaragua to jump-off points in Honduras and Salvador is am* inerious problem of logistics and sufficiently disadvantageous to warrant holding such arms in Nicaraguainimum.

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.aid that there are various ways in which the arTj could bec uutea to specific teams, both by clandestine entry through Nicaragua/ani by black air-drop. JC weighed these objections and withdrew his decision to ship arms at once to Nicaragua. Another important factor involved In this discussion t was pointed out Jchat the shipment of arms should not proceed in advance of tbe military negotiations withNicaragua as we must first be sure that Soraozaarrot well within reach before we come along with the stick. JC agreed to this.

3. The question of initiating an energetic foreign currency procurement program was discussed with JC and he was informed that further details would be available Monday on the subject. JC seeraed to realize that this matter of obtaining necessary large quantities of foreign currencies would not be easily resolved and concurred rocurement program utilizing all sources for the acquisition of the necessary funds.

Ii. Regarding the security clearancesind RUFUS, JC informed

that ithere was not objection to going direoCJy to Staff C, providing the request was handledormal manner without attracting any attention to the possibility that these individuals would be used for operational purposes. This was agreed to. The matter of safehouses, according to JC, should be handled directly with ho has been alerted to Jo lay on specific requirement.^. ttC was informed that this would Aoctbedone until the subject matter was studied more thoroughly.

5-presented to JC for his approval as the candidate

to fill the AamifiiaActive Assistant slot. Mentioning herhaving been Ray Leddy's secretary,our of duty inprofessing knowledge of administrative procedures at bothin the fieldnowledge of the language. JC said tbat heuse the girlwas expectedecember as he had no

slot for her and wanteu to recommend her very highly for thisthoy had no knowledge of her administrative abilities asidehandling of work requirements in

agreet to wait her arrivalecember Del ore man^ng ms own decision.

Security Infw.'Jon

Original document.

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