The Nazi war machine bulldozed all before it in the victorious days of the blitzkrieg campaigns of 1939–41 that reached from the Atlantic Ocean to the gates of Moscow. Most of the nations of Europe were crushed beneath the Nazi jackboot and the tracks of the all-powerful panzers. Once occupied, these countries were unmercifully plundered of their wealth and cultural heritage to feed the coffers of Nazi Germany and satisfy the greed of its corrupt leadership. Between them, Adolf Hitler and Field Marshal Hermann Göring acquired the most extensive and valuable art collections of any individuals ever in history. Similarly, the national treasuries of the occupied countries were looted of their gold bullion and coinage to pay for the raw materials necessary to sustain Germany’s war effort. First and foremost, the Nazi Party was a criminal organization and its hierarchy acquired much of this wealth for its own dubious ends, let alone the gold and money extracted from the victims of the Holocaust before they were butchered in the gas chambers of the death camps. Large quantities of gold and precious gems were processed through the neutral countries of Switzerland, Sweden, and Spain, with considerable individual fortunes secreted in the numbered accounts of Swiss banks. There is an old German saying that “Money does not bring happiness unless you have it in a Swiss bank.”
By 1943, Martin Bormann realized that the war was lost and the Nazi Party doomed to extinction. He instituted Aktion Adlerflug (Project Eagle Flight) to smuggle gold bullion, gems, and other valuables out of Germany to safe havens around the world, especially in South America. The amount of money was staggering. There was to be no repeat of the Treaty of Versailles, when Germany was stripped of all its possessions and wealth. At the same time, Bormann devised Aktion Feuerland (Project Land of Fire) to secure a safe refuge for the Nazi leadership. The chosen bolt-hole was in the depths of deepest Patagonia in Argentina. The price was high, but Nazi gold was a powerful inducement. Argentine gold reserves grew from 346 tons in 1940 to 1,173 in 1945—a sum of some $1.4 billion. Brazil’s grew from 50 tons to 346 in the same period—an increase of $350 million. As a comparison, the cost of gold in 1945 was $37 an ounce: it is now, at this writing, $1,360 an ounce. Similarly, the purchasing power of the U.S. dollar in 1945 was approximately twelve times what it is today, so all sums quoted in this book must be multiplied by at least a factor of ten to appreciate their true value.
By 1944, the Western Allies were poised for the invasion of northwest Europe with the largest amphibious landings in history on the coastline of Normandy in France. The Allies were well aware of the superiority of German military technology, from the Tiger 1 heavy tank to the Messerschmitt 262 jet fighter, as well as the world’s first ballistic missile—the V-2 “Vengeance Weapon.” Similarly, the Allies were highly fearful that the Germans might develop the first atomic bomb. Evidence of the extermination of the Jews and other minorities was becoming apparent, as was the plunder of Europe’s wealth and famous works of art. Accordingly, the Allies created a host of elite Special Forces units to address each of these problems. Teams of warriors and experts, such as 30 Advance Unit, Monuments Men, TICOM, and the Alsos Mission, were at the vanguard of every Allied army to uncover German military technology, loot, and hidden treasures. Their work was so secret that their extraordinary exploits can be revealed only now after many years hidden in classified documents. These elite units were crucial in the defeat of Germany, and with the subsequent emergence of the Cold War their roles became integral in the struggle against communism. Their quest for Nazi weapons and research projects proved invaluable in the postwar space race and the development of intercontinental ballistic missiles, advanced submarines, and biological warfare agents.
With defeat looming, members of the Nazi hierarchy, such as Reichsführer-SS Heinrich Himmler, tried desperately to achieve a separate peace with the Western Allies, whereby the democratic powers would join forces with Germany to fight the threat of communism as the Red Army rampaged through Eastern Europe. Most of these peace feeler forays were conducted through neutral countries with agents of the British Secret Service, MI6, or the U.S. Office of Strategic Services (OSS). The main OSS center in Europe was in Switzerland and run by Allen Dulles, later director of the Central Intelligence Agency (CIA) between 1953 and 1961. From his offices in Bern, Dulles coordinated hundreds of agents, including several Nazi diplomats, across occupied Europe. In early 1945, Dulles was in direct communication with various Nazi factions and Wehrmacht generals to arrange a separate peace in Italy and Austria in order to shorten the war and end the suffering of millions.
To the end, Bormann was determined to save the looted wealth of Germany for his own nefarious ends and to sustain a select band of Nazis following military defeat and the fall of Berlin. Massive funds were channeled abroad while large stashes of bullion and stolen artworks were hidden underground in deep mines across the Third Reich. These were primed with explosives for demolition, which Bormann considered preferable to allowing them to fall into the hands of the Bolshevik hordes. But to Bormann, the artworks were also a bargaining tool. It seems evident that Bormann offered the OSS a Faustian pact: the fruits of one thousand years of Western art together with the secrets of Nazi Germany’s advanced military technology in exchange for the escape of one man—Adolf Hitler. The alternative was the total destruction of the jewels of Western civilization. This was the key to Aktion Feuerland. The deal was done and on the night of April 28, 1945, the plan was put into place. Grey Wolf was on the run.
GREY WOLF
The name Adolf derives from the Old High German for “noble wolf.” From early on, Adolf Hitler used the nom de guerre of Wolf. It was a title he used throughout his life. His first mistress, Mitzi Reiter, called him Wolf and it was as Herr Wolf that he was introduced to Eva Braun. To intimates such as the Wagner family, heirs of composer Richard Wagner, he was known as Uncle Wolf. As Hitler became more famous, he had the surname of his younger sister Paula changed to Wolf so that she could live quietly in Vienna while running an arts and crafts shop; she was buried as Paula Wolf at Berchtesgaden when she died in 1960. Hitler’s yacht was called Seewolf (Sea Wolf) and his personal plane Fliegende Wolf (Flying Wolf). His field headquarters in East Prussia was the Wolfschanze (Wolf’s Lair); in the Ukraine it was Wehrwolf (Werewolf), while for the battle for France it was the Wolfsschlucht (Wolf’s Gorge). Among the most potent of Hitler’s weapons during World War II were the wolf packs of U-boats that preyed on Allied shipping. U-boats themselves were known as grey wolves and it was in one of them from a wolf pack code-named Gruppe Seewolf that Hitler escaped to Argentina, where he spent his declining years as the proverbial Grey Wolf.
PART I
THE NAZIS TRIUMPHANT
German troops goose-step through Warsaw, Poland, October 1939.
Chapter 1
FUELING THE BEAST
AT THE BEGINNING OF OCTOBER 1942, the Third Reich was at the zenith of its success. The empire occupied by Hitler’s armies stretched from the Arctic Sea of northern Norway all the way south to the deserts of North Africa, and from the Atlantic coast of France eastward to the Volga River, deep inside the Soviet Union. On the North African front of the Wehrmacht (German armed forces), Field Marshal Erwin Rommel’s Deutsches Afrika Korps was poised on the border of Egypt for a final offensive to capture the Suez Canal—the vital jugular vein of the British Empire. On the Volga, Gen. von Paulus’s Sixth Army was fighting its way yard by yard into the city of Stalingrad in savage street fighting. If the Suez Canal and Stalingrad were to fall to the Germans, then the oil fields of the Middle East and the Caucasus would be theirs for the taking, fueling the German war machine with the essential lifeblood of warfare to sustain itself for decades.
Meanwhile, the ships from Canada and the United States carrying the fuel, the munitions, and the very food that beleaguered Britain needed to sustain itself after three exhausting years of war were being sent to the bottom of the Atlantic in appalling numbers by German submarines. From their bases on the Atlantic coast of France, Adm. Karl Dönitz�
��s U-boats ranged out to gather in “wolf packs” astride the western sea-lanes. Since January 1940, British experts at the Government Code and Cypher School at Bletchley Park had been increasingly successful in cracking intercepted German signals traffic generated by the “Enigma” encryption machine, producing the stream of priceless top-secret intelligence—code-named “Ultra”—that would give the Allies an extraordinary insight into the intentions and capabilities of Hitler’s armed forces. Nevertheless, it was May 1941 before the capture of an Enigma machine and its operating manuals from a U-boat allowed the breaking of the Kriegsmarine (German navy) codes. For a while, British antisubmarine successes had increased encouragingly, but, in February 1942, a modification of the Enigma code-setting system—code-named “Shark” by Bletchley Park—once more denied the Royal Navy its invaluable access to Dönitz’s operational orders to his U-boat commanders at sea. The cost of this denial was about to be demonstrated yet again.
ON THE EARLY MORNING of November 2, 1942, a convoy of forty-two ships designated SC-107, heading eastbound out of New York, was approaching the “Black Pit”—the seven-hundred-mile gap in the mid-Atlantic where shipping could not as yet be protected by Allied aircraft. Closing in on the convoy were thirteen U-boats of Gruppe Veilchen (Group Viola). At this time many Allied naval assets had been diverted far south to take part in Operation Torch, the invasion of French North Africa. Convoy SC-107 was protected only by Canadian Escort Group C4, with just one destroyer and four corvettes. Under the cover of darkness and bad weather, two U-boats slipped through the widely stretched cordon of escorts and maneuvered into attack positions. Cdr. Baron Siegfried von Forstner’s U-402 fired a salvo of torpedoes at a range of four hundred yards and one struck the freighter SS Empire Sunrise amidships, damaging it badly. It would later be finished off by Lt. Cdr. Horst Uphoff’s U-84. Lt. Cdr. Herbert Schneider’s U-522 also penetrated the escort screen and sank no fewer than four vessels. By dawn, Gruppe Veilchen had sunk eight ships and damaged two more. The U-boats then slipped away to avoid detection but had to remain on the surface in order to keep up with the convoy.
Throughout the following day, convoy SC-107 tried to evade the wolf pack by changing course whenever fog or snowstorms provided any fleeting cover. Soon after the early sunset of November 3, U-89 (Cdr. Dietrich Lohmann) slipped into the center of the convoy and launched five torpedoes. Two of them struck their targets, including the convoy commodore’s ship, the 5,318-ton SS Jeypore, laden with ammunition. Around midnight, U-132 (Lt. Cdr. Ernst Vogelsang) unleashed a fan of five torpedoes toward the starboard flank of SC-107. Three ships were hit. Thirty minutes later one of these vessels, carrying munitions, exploded with such ferocity that surface ships some six miles away felt the blast and U-boats at depths of two hundred feet were jolted by the shock wave—indeed U-132 and her crew were never heard from again. On November 5, a Royal Air Force B-24 Liberator long-range bomber of No. 120 Squadron arrived overhead and further naval escorts from Iceland rendezvoused with SC-107. When U-89 was damaged by air attack, Gruppe Veilchen broke off the battle. It had won a significant victory: in all, fifteen merchantmen out of forty-two were sunk and four damaged, for a total of 107,958 tons of shipping lost.
During the month of November 1942 alone, a total of 730,000 tons of Allied shipping was sunk. During the whole of 1942, the Allies lost an estimated 1,661 ships and 6.5 million tons of cargo to U-boat attack. About 87 U-boats were sunk but 238 new boats were commissioned and that year saw Dönitz’s fleet increased from 91 to 212 boats. Famously, British prime minister Winston Churchill wrote, “The only thing that ever really frightened me during the war was the U-boat peril.” He declared, “On their defeat hung the outcome of World War II.”
IF THE COSTS OF A WORLD WAR in blood and misery are almost incalculably huge, so they are in treasure—but for the canny and the farsighted, vast deficits also create vast opportunities.
The terms imposed on Germany by the Treaty of Versailles after her defeat in World War I were draconian. Articles 231 to 248, the “war guilt” clauses, stipulated that Germany alone bore complete responsibility for the war and therefore must pay immense reparations to France, Belgium, Britain, and other countries. The sums involved amounted to 132 billion gold marks ($31.4 billion). When Germany defaulted on payments, the French and Belgian armies occupied the Rhineland. The mark collapsed and the economy was saved only by massive loans through Wall Street and other international banks.
In August 1924, the Dawes Plan brokered by the U.S. government imposed a moratorium on reparations and provided a $200 million loan to allow German industrial reconstruction. This elegant solution allowed American money to finance German industry through loans, whereby the German government was able to make reparation payments to Britain and France and they in turn were able to repay America for the loans they had incurred to finance their colossal military expenditures during World War 1. In the decade between 1921 and 1931, international banks provided Germany with some 27 billion marks in loans while the Allies received some 19.1 billion marks in reparations. Created in 1930 specifically for the task, the Bank for International Settlements (BIS) in Basel, Switzerland, staffed by representatives from all the participating nations, supervised the process of reparations.
Two of the American corporate lawyers who were actively engaged in the flow of funds from the United States into Germany were brothers named John Foster and Allen Welsh Dulles. They worked for the prestigious New York law firm of Sullivan & Cromwell. They acted for business clients wishing to invest in German industry or to enter into partnership with established companies. The Dulles brothers, scions of a patrician East Coast family with a tradition of public service, had enviable background experience and contacts for this role. Their uncle was Robert Lansing, who had been U.S. secretary of state under President Woodrow Wilson. During World War I, Allen had served as a State Department attaché in Berlin, Vienna, and Bern in neutral Switzerland, gathering intelligence on the Central Powers. At the invitation of “Uncle Bert” Lansing, both the Dulles brothers had been members of the U.S. commission at the Paris Peace Conference (1919–20) that had culminated in the Treaty of Versailles.
American corporations such as the Aluminum Company of America (Alcoa), DuPont, International Business Machines (IBM), General Motors, International Telephone & Telegraph (ITT), the Ford Motor Company, and General Electric made significant investments in Germany. Joint enterprises were created to exchange technical innovations and to divide market shares around the world. This led to the merging of existing German companies into powerful and influential conglomerates, such as Interessen-Gemeinschaft Farbenindustrie (IG Farben), which was founded in 1925. IG Farben was a market leader in the manufacture of chemicals, dyes, pharmaceuticals, explosives, rubber, and a host of other products—indeed, IG Farben was the prototypical “military-industrial complex.” In April 1929, Standard Oil of New Jersey joined forces with IG Farben to develop a hydrogenation process for converting coal to oil. Again, American money funded the research and development in Germany while the world markets were to be shared between the two companies. In return, IG Farben promised to provide the technical specifications for its new “buna” process for the production of synthetic rubber, a vital strategic resource for both countries. As America’s stake in Germany expanded, so U.S. government officials were less inclined to support the repeated demands for reparations by France and Britain, for fear of jeopardizing American investments.
EVERYTHING CHANGED WITH THE WALL STREET CRASH of 1929. That October, America’s financial system collapsed and the world was plunged into the Great Depression. With its mountain of international debt and its weak and unstable political institutions, Germany’s Weimar Republic was especially vulnerable. In 1929, the National Socialist German Workers’ Party (NSDAP or Nazi Party) boasted just 120,000 members. As the economic situation deteriorated, the party’s popularity grew as a strident force promising the frightened petite bourgeoisie protection against hunger, anarchy, a
nd the perceived menace of communism. In the elections of 1932, the Nazis won a majority of seats in the Reichstag (Parliament) with a popular vote of 37.3 percent. As a result, Adolf Hitler became Reichskanzler (national chancellor or prime minister) on January 30, 1933.
During that month the Dulles brothers were in Germany on behalf of clients of Sullivan & Cromwell, both American and German. The latter included IG Farben, Robert Bosch GmbH, and Vereinigte Stahlwerke AG (United Steelworks), which was run by the leading German industrial families of Fritz Thyssen and Friedrich Flick. The steel magnate Fritz Thyssen had been a major contributor to Nazi funds during the 1932 elections. In early 1933, the Dulles brothers met Hitler to determine business prospects under the prospective government. Hitler’s determination to embark on a massive rearmament program provided even more opportunities for America to do business in the Third Reich. Later, at a Berlin reception given by Thyssen, Allen Dulles met Martin Bormann, an ambitious Nazi bureaucrat assiduously seeking favor with the Führer. He later recalled that Bormann was not the “grubby, uncivilized man” he had been led to expect: “He was soft-spoken and direct, but while he talked to you his eyes continued to keep watch on Hitler and those surrounding him. I felt he was a man of strength who might one day best his more colorful rivals in the Nazi hierarchy.” It was a remarkably prescient observation.
Within weeks of Hitler’s appointment as chancellor, an attempt to burn down the Reichstag building gave him the excuse to rush through emergency legislation suspending civil liberties, freedom of the press, and regional autonomy. The last multiparty election, held on March 5, 1933, returned the Nazi Party with 44 percent of the vote. The first concentration camp for political prisoners was opened on March 22, at Dachau near Munich. On the following day, an enabling act was passed that allowed Hitler to rule Germany by decree as an unfettered dictator. In an irony too gross to need stressing, the act’s full title, Gesetz zur Behebung der Not von Volk und Reich, literally meant “The Law to Remedy the Distress of the People and the Nation.”
Grey Wolf: The Escape of Adolf Hitler Page 3
