NEW YORK, October 1, 1861.

Honorable WILLIAM H. SEWARD,

Secretary of State, United States.

SIR: Yours of the 23rd September with inclosures in relation to George Miles, confined in Fort Lafayette, were received in due course. I have examined his case and taken all the testimony against him that I can discover, and beg leave to make the following report:

It appears that George Miles was a commercial agent engaged in disposing of property and collecting moneys in the loyal States for persons in the States declared in the President's proclamation to be in insurrection. That when arrested he had in possession securities and moneys so collected which he was about to carry South to the States in insurrection. A schedule of these securities and moneys was furnished you by the superintendent of police, J. A. Kennedy, and is herewith reinclosed. * It further appears that he was seeking to cover up the funds and property of his employers to save them from confiscation.

Even if the securities and moneys found on Mr. Miles are subject to confiscation under the act of Congress approved August 6, 1861, or the fifth section of the act approved July 13, 1861, his acts as they appear in the testimony do not amount to a legal offense for which he could be personally convicted as a criminal. I do not think it can be pretended that the securities and moneys were intended to be used or employed in aiding, abetting or promoting insurrection or resistance to the laws. I do not see how any offense can be established against Mr. Miles.

Very respectfully, yours,

SETH C. HAWLEY.

I inclose herewith the documents transmitted to me and in addition the affidavit of John S. Young, sergeant of detectives, which contains all the evidence I can hear of against Mr. Miles.

[Indorsement.]

OCTOBER 3, [1861].

Let Miles be released upon taking the oath of allegiance and engaging to hold no correspondence and do no act hostile or injurious.

W. H. S[EWARD].

[InclosITAN POLICE DISTRICT, City of New York, ss:

John S. Young being duly sworn doth depose and [say] as follows:

I am sergeant of the detective force of New York. I arrested George Miles at the Metropolitan Hotel, New York, about or before 20th of August last and searched him and his baggage and found the funds described in a schedule furnished by Superintendent J. A. Kennedy to the Secretary of State, also numbers of letters addressed to persons South from persons here. These letters were sealed. Miles was prepared to start for the South that evening. He had been a room mate with a man by the name of Jones who talked violent secession doctrines very openly and indiscreetly. Miles said less and was more discreet. Miles said that his business was as agent for Southern men of business in selling commodities and collecting money and sending it South, and that this was done to prevent confiscation of property. He

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* See p. 533 for Kennedy's inventory.

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