Memorandum to E. I. McLarney from Elting Arnold, with Attachment

0 P Y Mr. E. I. McLarney, Deputy Commissioner September 7, 1951 Income Tax Unit, Bureau of Internal Revenue Elting Arnold Assistant General Counsel At the most recent interdepartmental meeting regarding the China Lobby further requests for information from the Treasury Department were received. As a result I attach a list of names concerning which the same investigation of your files is requested as was asked by my memorandum of August 15, supplemented by my memorandum of August 20. In conversations with Mr. Sugarman I indicated that in addition to the items specifically referred to in the second paragraph of the August 20 memorandum it would be important that you furnish any other information from your files seem- ing to indicate any connection with China or the China Lobby. I did not make this request in writing because Mr. Sugarman informed me that he would make sure that this additional information was supplied. However, in connection with these additional names, it seems desirable to record the request in writing. We have also received certain questions which are set forth below: 1. "Alfred Kohlberg is quoted by Ed Harris of the St. Louis Post Dispatch as stating that he charges the cost of printing pro- China propaganda and the cost of publishing his newspaper against the operations of his importing company, Alfred Kohlberg, Inc. He states that this includes the cost of ma- terial sent regularly to 2,000 publishers and editors. Bureau of Internal Revenue should check income tax returns of Alfred Kohlberg and Alfred Kohlberg, Inc., for possible violation of income tax law." In my opinion this question can be interpreted as having two effects (1) to suggest that your Bureau might be interested in the possible violation of income tax laws which is indicated, and (2) to request that information developed in any such investigation be made available to the Committee. Since I understand that you have already made some investigation of Kohlberg it may be that you can supply at least some information bearing on this question. If you can, it is requested that the information be made available to me on the same understanding as to the conditions on which it will be conveyed to the Committee as previously stated. 2. "A report on the Chennault income tax case involving a strong box containing $250,000 in cash which was located in New Orleans is needed." Please supply any information you may have on this matter to be conveyed to the Committee on the same terms. DECLASSIFIED E.O. 12065, Sec. 3-402 ANNUAL SEGRET State Dept. Guideline, June 12, 1979 TREASURY LTR. 1-26-79 By NLT NARS, Date 7-18-10