The American-flagged, 35-ton schooner Cheerio was built in 1893 as a barge / lighter. Her owners were the Antilles Shipping Corporation which had officers in San Juan and Ciudad Trujillo, Dominican Republic. The majority stockholder was Pascual Negroni, a Puerto Rican in the Dominican Republic, and Jose Alberto Negroni and Pedro Vasquez in San Juan. The total value of the uninsured vessel and cargo was claimed after the casualty to be US$10,000.
On her final voyage the Cheerio was heading from Trujillo City to Ponce, on the south coast of Puerto Rico, east across the Mona Passage. The cargo was mahogany wood. Her crew of nine men total was led by Captain Felix Hernandez. The nationalities of the crew were: one British (West Indian), five Dominicans, and three Americans. The voyage was proceeding slowly, with headway only two and a half knots in light winds. Aside from the helmsman there was one lookout. There was a light wind from the northeast, and haze was making visibility difficult.
In the middle of the passage, when roughly eight miles southeast of Mona Island, at 1:10 am on the 19th of June 1942 watch-stander Antonio Jose Malian saw a bluish green light roughly ten miles off the port bow. It was on for a minute, then off for a minute – probably a torch being used by the Germans to prepare their gunnery for sinking the schooner. Starting at 2:00 am, the next man to steer the ship was Eloy Tocker. He too saw the same light, this time eight miles off the starboard bow, several times.
At 2:30 am local time U-107 under Harald Gelhaus (not U-161 under Albrecht Achilles, who was in rendezvous with U-156 in the Caribbean at the time), opened up a barrage of shelling on the schooner from a position 100 meters aft. The sub was heading to the northwest, towards Mona Island, in the opposite direction of the schooner, which was heading southeast. After lobbing four or five shells the submarine let the men abandon ship, which they did by jumping in the water. Then the sub continued by sending two or more rounds into the schooner.
In the middle of the attack an American PBY amphibious airplane swooped down on the action from the direction of Mona Island but despite circling the scene did not drop depth charges or go after the submarine, which dove to escape. The plane then returned to the direction of Mona Island. The Cheerio was set afire by the shelling and sank. The men remained near the scene, sticking together (“they all helped each other” according to Fernandez). An hour after the attack began, or about 3:30 am, the boat sank. Two hours later, at about 5:30 am or shortly after dawn, another US patrol aircraft spotted the survivors and vectored a US patrol boat to them.
The men were found clinging to driftwood by the US Coast Guard 83-foot patrol boat CG 459 (#83309), which was based at Charlotte Amalie, Virgin Islands. Aside from minor cuts the men were uninjured. They were taken to Mayaguez also on the south coast of Puerto Rico, where they stayed at the American Hotel and were interviewed by Lieutenants A. V. Franceschi and G. W. Yancey of the US Naval Reserve on the 19th of June, 1942. Captain Fernandez and four of the crew (Perez, Tocker, Facundo, and Matos) put in claims with the US government for lost property.