MEMORANDUM FOR THE ATTORNEY GENERAL.

Referring to the letter addressed to you by the Governor of North Carolina of August 12, 1918, hereto attached, concerning report made by Special Agent Phillips, I have the honor to invite your attention to the attached memorandum prepared for me by Mr. Clark, of this office, giving the facts in the investigation out of which this matter arises.

That the report of the agent reached the Governor was the fault of an officer in the Provost Marshal General’s office, with which office, of course, we deal in perfect confidence. The matter was taken up with the Provost Marshal General’s office last May and since that time no further difficulty of this kind has been experienced.

It would seem from Mr. Clark’s memorandum that we should ascertain the present status of the proposed prosecution of Laughinghouse before taking any action to transfer Special Agent Phillips, as his removal at this time might seriously interfere with a meritorious prosecution. I am, accordingly, writing Special Agent Phillips to ascertain the present status of this case.

Agent Phillips has accomplished exceedingly fine results in North Carolina in the enforcement of Sections 12 and 13 of the Selective Service Act as well as of Section 6, and it will be very unfortunate indeed for us if it is necessary to remove him to some other field.

It has been three months since the Governor brought this report to the attention of General Crowder. There also seems to be some foundation for his inquiries concerning the Governor as the latter’s actions are apparently necessarily interwoven with those of the prospective defendants.

The agent has not told people, as suggested by the Governor, anything adverse to the Governor, but has so far as is known, confined his statements to those made in [illegible] and confidential report to his superiors which he had a perfect right to make and which reached the Governor through an error which was no fault of his or of this Department.

While the first three reasons given by the Governor for Phillips’ removal are not impressive, I appreciate the force of his fourth reason, but it occurs to me that a letter might be drafted of explanation and regret to the Governor which would also contain a reference to the value of Phillips’ work and a request for an expression of his views as to whether or not under all the circumstances, in view of the great need for the services of efficient men where they are able to do the best work, he would not be willing to overlook the particular statement of the agent which was offensive to him.

Quite likely the Governor is interested in preventing a prosecution of Laughinghouse and the chances are he will insist on Phillips’ removal, but such a letter will gain a little time and might possible make it unnecessary for us to transfer a man who has done very good work under circumstances which will necessarily cause him to feel that he has suffered some by having done his duty.

Please advise me whether you think it worth while for me to try to draft such a letter as is herein suggested.