CONFIDENTIAL
47/1
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bu
(3)
BANK OF ENGLAND
Threadneedle Street
London
BC2R 8AH
RECEIVED IN
14th January 1974.
REGISTRY No.47
15 JAN1974
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خوفي
MF7/2(131)
Деси чай,
In my letter of the 21st December I promised to write further about the questions raised by Donald McCarthy in Abu Dhabi about visiting merchant bankers.
McCarthy seems to be primarily concerned about two points: Tirstly whether he should encourage British firms or individuals to fish for money in the Gulf; and secondly how to tell the reputable firms from the fly-by-night operators.
On the first point, I think that Embassies should be preparád to give all reasonable encouragement to representatives of reputable City firms, since even if the funds are eventually channelled elsewhere, there should be some benefit to the invisible account.
We hope of course to attract investment of oil surpluses in Britain and, to the extent the Far East is a competitor, we are less interested in seeing money go that way. So far as the Hongkong & Shanghai Banking Corporation are concerned, the guidance McCarthy gave seems about right. They can do business in any case through the British Bank of the Middle East, their wholly owned subsidiary.
On the second point, it is more difficult to suggest an answer. I agree with McCarthy that the practice of giving indiscriminate letters of recommendation is undesirable and should be discouraged. No doubt the Embassies have standard works of reference, and would deal circumspectly with doubtful cases.
In cases of difficulty, if McCarthy or his colleagues get stuck on a banking name and would like further information, we would be glad to see what we can provide, and if necessary he could contact me by telephone,
I enclose a copy of this letter for McCarthy if you think this
appropriate.
Yours sincerelyy
D.I.Lewty, Esq.
R.H.Turner.
Hemy Themes. Нешу
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