In this capacity, he helped channel funds to the revolt against Liberal President José Santos Zelaya, who had incurred the anger of the United States by negotiating with Germany and Japan to resurrect the proposed Nicaragua Canal.

In return, in 1914, he signed the Bryan–Chamorro Treaty, which granted the United States exclusive rights to build an inter-oceanic canal across Nicaragua.

One Liberal commander, Augusto Sandino, rejected the agreement and waged a guerrilla war against the U.S. Marines, who remained in the country to prop up Díaz's government and enforce the Espino Negro accord.

In 1928, after elections supervised by the Marines, Díaz was replaced as president by former Liberal General José Maria Moncada.

He lived in the U.S. for more than a decade, primarily in New York City but also in Miami and New Orleans, before moving to Costa Rica, where he died in 1964.