I desire to say that thus far in the progress of the army every dollar's worth of property, except that which has been taken by individual robbers in money and jewelry, who have ben punished summarily therefor, has been scrupulously appropriated to the use of the Government. Not a speculator nor a plunderer follows the trail of the army and none will be permitted in this campaign.

I have the gratification of representing in the most unqualified manner the general desire of the people for the restoration of the Union. Many thousands would gladly at once renew their obligations to its support did I encourage it. Four hundred of our prisoners of war have voluntarily taken the oath of allegiance, and there are manifestations of various kinds which show that the spirit of the rebellion and the supremacy of the Confederacy has passed from the minds of this people. There is an excellent opportunity, by a wise and conciliatory policy, to realize, in this quarter at least, the most sanguine expectations of the President.

On the march to this point I ordered the arrest of ex-Governor Mounton, who occupied the gubernatorial chair in 1845 and subsequently. He is a man of large influence and intelligence, and has wielded with an iron hand his power over the masses of the people in this part of the country. He was president of the Convention that declared Louisiana to have separated from the Union. His influence is still important, and at a time when the sentiment of the people was in transition from acquiescence in the Confederate Government to a recognition nd renewal of their obligations to the Union it seemed important that such a man should at least be quiet. I have therefore ordered him to New Orleans in the custody of the provost-marshal-general, with instructions to that officer to provide hi comfortable quarters, but not allow general intercourse with the people of the city, where he will remain until further orders from the Government of the United States. This is the only arrest made, except for crime.

The inclosed dispatch to the Secretary of State I beg may be transmitted to his Department.*

I have the honor to be, with great respect, your obedient servant,

N. P. BANKS,

Major-General, Commanding.

Major-General HALLECK,

Commander-in-Chief of the Army of the United States.

No. 18.] HEADQUARTERS DEPARTMENT OF THE GULF, Opelousas, La., May 5, 1863.

SIR: I have the honor to report that First Lieutenant C. S. Sargent, acting aide-de-camp of my staff, whom I sent up on the Cornie, on the afternoon of the 3rd instant, to communicate with Admiral Farragut, returned early this morning, bringing dispatches from Admiral Porter, and the gratifying intelligence that he had captured Grand Gulf; had then joined Admiral Farragut with four iron-clads, and was then about to start with his iron-clads and ours to Alexandria. Grant was on the Mississippi side, above Grand Gulf, with 36,000 men; had had a successful engagement with the enemy, and was expecting to be re-enforced by Sherman (W. T.) to 50,000.

Admiral Porter brought with him to the Red River the iron-clanks Benton, Pittsburg, Price, and La Fayette. Admiral Farragut has

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*See of same date, sand Chase to Stanton, May 28, 1863, in Series III.

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