under extraordinary influences brought to bear by the friends of interested parties; and in repeated instances the rebel agent took care to indorse upon special applications the express declaration that he neither made nor countenanced such applications.

In consequence of this state of thing, and while there was a hope of effecting general exchanges, only a few applications of a special character were forwarded over the lines; but when it became apparent that a general exchange could not be effected I received your instructions to forward all special applications for exchange, in order, as you explained the purpose at the time, to afford every possible opportunity to extend relief to as many individuals as might have the good fortune to secure Southern influences for that object; and great numbers of such applications were sent over the lines, most of which, however, were never heard from afterward.

Another fact I beg to state in connection with this subject, as a further illustration of the efforts of the Department to extend relief to Federal officers and soldiers imprisoned South, to wit: The rebel authorities resorted to the system of placing individuals in close confinement, in alleged retaliation for what on our side was but the legitimate operation of the laws of war in the punishment of spies and other offenders against those laws. In the endeavor to afford relief in a particular case of this kind the rebel seized the opportunity of proposing the mutual release and exchange of all prisoners in close confinement, although at that time we had no rebel prisoners thus confined except by due course of law. This proposition was manifesty unfair, and a recovered letter from the rebel agent has shown that he knew it was so.

Nevertheless, the proposition was accepted by your orders, and although it effected the release of some criminals belonging to the rebel army, it carried relief to a number of Federal officers and soldiers in the South, who thus obtained liberation, the concession on your part having had in view the relief it promised, and to some extent effected, in favor of a few of our officers and soldiers.

The recovered letter alluded to was dated at City Point, March 17, 1863, and addressed to Brigadier-General Winder, in the following words:

SIR: A flag-of-truce boat has arrived with 350 political prisoners, General Barrow and several other prominent men amongst them. I wish you to send me at 4 o'clock Wednesday morning all the military prisoners (except officers) and all the political prisoners you have. If any of the political prisoners have on hand proof enough to convict them of being spies, or of having committed other offenses which should subject them to punishment, so state opposite their names. Also, state whether you think, under all circumstances, they should be released. The arrangement I have made works largely in our favor. We get rid of a set of miserable wretches and receive some of the best material I ever saw. Tell Captain Turner to put down on the list of political prisoners the names of Edward G. Eggling and Eugenia Hammermister. The President is anxious should get off. They are here now. This, of course, is between ourselves. If you have any female political prisoner whom you can send off safely to keep her company I would like you to send her. Two hundred and odd more political prisoners are on their way. I would be more full in my communication if I had time.

Yours, truly,

RO. OULD,

Agent of Exchange.

It should be noticed in this report that when the subject of exchange became embarrassing, because of the unwillingness of the enemy to exchange man for man, he demanding all of the rebel prisoners we held in exchange for the white prisoners held by him, Major-General Halleck, by the direction of the Secretary of War, made an effort to obtain exchanges on equal terms. For this purpose he sent a flag of truce to