FO371-23516 — Page 207

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inoreased its staff./

(111)

Considerable activity and movements of newspapermen

to and from Canton and Kaoru and occasionally French Indo-China

have been maintained throughout this quarter. In this connection,

cases have come to our notice recently of Bilitary and Special

Service men masquerading as press representatives.

On the other

hand, several Military and Naval officers have paid short visita

to Hong Kong quite openly.

3.

Further proof of the widespread ramifications of

Japanese espionage activities has come to light through the

discovery of an Intelligence Department in the local branch of

the Bank of Taiwan. It is known that they obtain data relatin

to Chinese Military, trade, currency, etc., and latest reports

have dealt with the political situation in South China, Kilitary

and defense expenses of Hong Kong and the trade done in wolfram ore

through Hong Kong to foreign countries. One member of their staff

attached to the Head Office in Taihoku quite openly but

inadvertently stated that he was Chief of the Bank's Intelligence

section.

4.

Press reports have it that an understanding has been

reached between the Portuguese and Japanese Authorities regarding

Kacau, and in this connection, the following may be worthy of

note to show the increased Japanese interest in Macau which has

been noticeable of late.

(11)

The Comandant of the Fortuguese Gendarmerie in Macau

mado a trip to Japan on 8.2.39, returning on 10.3.39, but it carnot

be confirmed through this office that WADA, the suspoct pseudo

dentist in Macau, went with him.

(111) On 24.3.39 an official attached to the Foreign Affairs

Department, Formosa, arrived in Hong Kong on his way to ?ladau and

made it quite olear tha: his destination was Hacau only and not

merely for the purpose of eventually reaching Canton.

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