War of the Rebellion: Serial 041 Page 0669 Chapter XXXVIII. CORRESPONDENCE, ETC.- UNION.

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It consists substantially of the old command of General Mouton, increased by conscription, and probably amounts to 2,000 infantry troops and four or five batteries of light artillery. The cavalry brigade of Colonel Major is also under his command. It consists of four small regiments of Texans, who are chiefly employed upon outpost duty. I crossed the Berwick this morning to examine the fort built there, and learned that large numbers of negroes have been seized within a few days to work upon the fortifications at Camp Bisland. The fort at Berwick, prepared for eight guns, I think I shall destroy, unless otherwise ordered.

They are also fortifying at Irish Bend. Through deserters, who are arriving constantly, much information in regard to the movements of the enemy reaches me, not of great military importance, but personally interesting. If desired, detailed reported can be furnished.

I respectfully repeat my application that a few pieces of light artillery may be sent to this post.

I am, sir your obedient servant,

FRANK H. PECK,

Lieutenant-Colonel, Commanding United States Forces.

[Indorsement.]

HDQRS. SECOND BRIGADE, FIRST DIVISION,

Camp Hubbard, La., August 5, 1863.

Respectfully forwarded, and for the information of the commanding general I add the following, which was communicated to me by the colonel of the Seventh Louisiana Volunteers:

The parish priest of La Fourche yesterday told Captain Silvey, provost-marshal, that he has received information, through a channel which he could not disclose, that 2,000 rebels cavalry were massed in the vicinity of the Teche, for the purpose of a raid on this post.

I entertain no fears, but have made dispositions accordingly.

I am, colonel, very respectfully, your obedient servant,

ROBERT B. MERRITT,

Colonel, Commanding Brigade.

NAVY DEPARTMENT,

August 5, 1863.

Honorable E. M. STANTON,

Secretary of War:

SIR: I have the honor to inclose to you the copy of a letter, dated the 24th ultimo, from Acting Rear-Admiral Bailey, and also the copy of a paper transmitted by him, signed by George S. Denison, who calls himself "special agent of the Treasury Department and acting collector of customs," authorizing Brott, Davis, and Shonn to bring cotton from the rebel region, and whose vessel, the Sea Lion, was captured coming out of Mobile.

The particulars of this extraordinary proceeding will be ascertained from a perusal of Acting Rear-Admiral Bailey's letter. As regards Mr. Denison and his license to trade with the rebel enemies, or any assumed authority to evade or violate the blockade, they cannot be reorganized, nor am I aware that General Banks has power to issue an order for such purpose, if he has done so.