On 9 June 1945 Lieutenant Nacke and an SS Lieutenant in American custody went to Taxenbach to contact one of Spacil’s liaison men, a local forester, who knew where the valuables were cached. Persuaded by the password and Spacil’s letter that it was in order to show his visitors where the treasure was hidden the forester led them up the mountain road to Rauris and the home of an individual called Urschunger. There, under the floor of a barn, they found a cache of 19 bags of gold coin and bullion, the latter subsequently found to weigh 10.5 kilos and be worth $11,722. Behind a bricked-up enclosure in the attic of the house they then found a stash of paper currency which included 160,179 US dollars and 96,614 English pounds (not counterfeit) in sacks sealed with Berlin Reichsbank seals.
More valuables were found at another cache just off the Rauris road. These comprised a very odd job lot of loot – a cross-section of the SS’s magpie scourings from Nazi-occupied Europe, including such handsome prizes as 4 watches, 9 rings, 2 boxes of counterfeit pound notes, 1 jewelled cross with diamond, 1 silver English florin, 1 silver English half-crown, 2 English silver sixpences, 9 English threepenny bits, 2 American silver quarters (worth all of half a dollar) and 2 dimes (worth all of 20 cents). In all, the valuables recovered from Spacil – those whose value could be in any way accurately determined – amounted to $550,857 which left some $8,580,143 (worth $76,363,272 in 1998) unaccounted for.
Whatever happened to that prodigious sum of missing funds was never revealed by Colonel Skorzeny, nor was he ever asked about it by US Army intelligence. When he gave himself up to the Americans on 16 May, Skorzeny was immediately driven off to Salzburg so that he could discuss the surrender of his men with higher-ranking officers. The sergeant who drove him there had never heard of the name Skorzeny, but when the German explained that it was he who had led the Mussolini rescue operation, the sergeant’s interest was suddenly riveted.
‘Then you must be the guy that led those Germans wearing our uniforms behind our lines during the Battle of the Bulge?’
Skorzeny admitted that he was indeed that man.
‘Well I’ll be damned!’ the sergeant exclaimed, pulling up in front of a Weinhaus in Berchtesgaden. ‘Buddy, I’m going to get you a bottle of wine so you’ll enjoy the rest of the trip to Salzburg. When they get their hands on you at divisional headquarters they’re going to string you up feet first.’
At Salzburg Skorzeny was promptly arrested and escorted to a CIC (Counter Intelligence Corps) headquarters in Augsburg for interrogation. He talked freely about professional business, about new sabotage techniques, ‘werewolf’ training and political insurrection against the Russians in the Ukraine and the Balkans. He complained that his agents had not been properly looked after by the Wehrmacht, were not given commissions, never given enough to live on, never had their expenses paid on time. He chatted happily on, the confident German hero and professional saboteur, assassin and subverter, but not a word did he utter about the treasure Spacil had placed in his custody. He did not talk about it during the three years he was in captivity at Nuremberg and at Dachau internment camp, nor during his trial on war crimes charges (in which he was acquitted), nor after his former SS comrades had organised his escape from American custody. Only when Skorzeny resurfaced as a free man in Spain in 1950 did it become apparent that a substantial portion of the missing treasure had resurfaced with him. He was now a rich man, living in a large villa in Madrid, entertaining lavishly, married to a Countess, and actively engaged in lucrative arms sales and deals in railway stock worth more than $5 million. And as the organiser and operational director of the clandestine SS escape organisation Die Spinne, which helped smuggle fugitive SS men out of Germany to comparative safety in South America and the Middle East, it was clear to American intelligence that Skorzeny now had large funds at his disposal. The SS assets snatched at gunpoint from the Reichsbank in war-torn Berlin in 1945 were being put to work again – and for the same old gang.
The SS robbery was not the last time the Berlin Reichsbank was to be ransacked by intruders. For after the SS came the Red Army. The military situation in the capital had deteriorated rapidly after Spacil’s departure and by 24 April the encirclement of the city was complete. To the north and east the Russians were approaching the S-Bahn defence ring. In the west and south they had reached Spandau and Potsdam. In the days that followed, the Red Army advance continued irresistibly towards the dead centre of the Nazi empire, the Reich Chancellery, from whose bunker the palsied and half-cracked Führer continued to direct his non-existent troops. On 30 April Adolf Hitler killed himself. On 2 May Berlin fell to the Russians.
On 15 May Reichsbank officials holding keys were summoned to the provisional Reichsbank building (not only the original Reichsbank but its successor had been totally destroyed by bombing) and were ordered by a Russian officer, Major Feodor Novikov of Red Army Intelligence, to open the vaults.
Before the final collapse there had been 90 gold bars worth $1,278,000 ($10,735,200 today) and over four and a half million gold coins (dollars, sovereigns, guilders, francs) worth $2,156,625 ($18,115,650 today), along with 400 million dollars’ worth of negotiable bonds technically payable in gold or dollars. Major Novikov examined the contents of the vaults, then ordered them to be locked up again and demanded the keys. Shortly afterwards the contents of the Reichsbank disappeared. Whether Novikov was acting under orders – the Supreme Soviet never passed any laws for the confiscation of enemy property during the war – or operating on his own account has never been established. The gold was never seen again. But the bonds (Weimar, Westphalia, Industrial) have turned up at long intervals in West Germany, Holland, Israel, USA, Switzerland, Canada and Great Britain. During 1998 the bonds began to reappear in Central America.
The first known reappearance of the bonds was in 1951. On 13 August of that year a dubious private American banker, Herman William Brann, created a sensation at the US Air Force’s European Headquarters in Wiesbaden when he told officers an incredible story. A Russian agent called Churra Gorenstein, who ran a small business from a flat in Paris, had approached him with a request to sell back to the new German Federal Government $75,000,000 worth of dollar-denominated German bearer bonds (Weimar bonds). There were caches of these Weimar bonds in Paris and Liechtenstein, Brann said, with a face value of $275,000,000 and these were being sold on the black market with forged proofs of ownership. Brann believed the bonds had been seized by the Russians when they invaded East Germany, then smuggled out through Czechoslovakia and given to Gorenstein to sell in the West in return for much-needed Western currency. The incident was reported to Washington and a special agent from the US Counter Intelligence Office of Special Investigations was assigned to track down the bonds and their current owners. Over the next ten years the agent and his associates were able to sort out $240,000,000-worth of genuinely held German Government bonds from the ones looted by the Russians. By then the German Federal Government had enacted legislation for validating the pre-war bonds so that they could either be redeemed for cash or exchanged for other securities or negotiable certificates. The bonds were payable to the bearer but under the new law the bearer had to establish proof of ownership of the bonds on 1 January 1945. By 1961 it seemed that the problem of the looted bonds was at an end. But in 1969 a new source of bonds appeared.
In October 1969 a London bank received a request from New York to sell £27,000,000 of the bonds. Scotland Yard, the German Federal Bank, Interpol, the FBI and the American Department of Justice were called in and investigations revealed that the bonds had belonged to a branch of the now defunct Reichsbank and had been smuggled from East Germany to New York ‘probably to finance Russian intelligence activities in the West’.
In spite of the German Government’s legislation the bonds have continued to surface right up to the present day. The Mafia are supposed to have a room full of them to subsidise their devious operations. In 1974 $2,500,000 of Westphalia bonds were deposited in a bank in Hamilton, Ontario. Subsequently the bonds be
gan to appear all over the USA and approaches were made to financial institutions in Washington to redeem $10,000,000 in German gold bonds that were said to have matured. In March 1979 three men were tried and sentenced in Brantford, Ontario, for fraudulently attempting to obtain credit for Westphalia bonds with a face value of $1,000,000. As recently as the summer of 1982 a Gibraltar-based insurance company called Signal Life built up a substantial part of its portfolio with gilt bonds backed by Weimar Republic and other industrial bonds acquired from a convicted American securities swindler named Chester Gray.
All latter-day attempts to negotiate German gold and dollar bonds taken from the Berlin Reichsbank by the Red Army after the end of the war have ultimately foundered on the near-impossibility of establishing legal ownership on 1 January 1945. But one particular form of bond, the German industrial bearer bond, has proved more of a headache. German banks have admitted that they have to be careful about rejecting claims on these bonds because of the possibility that the original owners may have been Jews who disappeared in the concentration camps. It was not unusual during the war for Jews to try to buy their freedom by transferring jewellery and bonds to their captors in return for a promise to be allowed to escape. While it is almost certain that most of the Westphalian and Weimar gold and dollar bonds in circulation were stolen by the Soviets, there are still about $20,000,000 of legitimately held bonds yet to be registered. Even today it is not too late to validate legitimately held bonds, though as time goes on it will become increasingly difficult to prove ownership of a bearer bond all the way back to 1 January 1945. Until that time the aftermath of the Reichsbank robbery, in a sense, still lives.
The theft of $400 million of gold bonds from the vaults of the Reichsbank in Berlin, the disappearance of $3,434,625 of gold bars and gold coins from the same vaults, the armed robbery from those vaults of $9,131,000 of foreign currency and other valuables by General Spacil on 22 April, the piecemeal theft by General Berger, Reichsbank Director Rosenberg-Lipinski and others of immense amounts of foreign currency brought from the Berlin branch to the Munich branch for safekeeping – all these individual robberies combined to make the disappearance of a large portion of the Reichsbank reserves in the spring of 1945 the greatest monetary loss through grand larceny suffered by any organisation in modern times. The Great Train Robbery of 1963, in which fifteen masked men stopped the Glasgow to London night express and robbed it of £2,500,000, is the Great Reichsbank Robbery’s nearest rival in this century, but still falls far short in sums involved, while a comparison with other modern robberies on a similar scale – the value of their total takings greatly distorted by the world-wide inflation that has taken place since the early 1970s – is given at the end of Chapter 13. To find anything which compares in magnitude to the robbery of 1945 one must go back more than 260 years, to April 1721, when two pirates, Captain John Taylor and Captain Olivier La Buze, made their historic capture of the Portuguese East Indiaman Nossa Senhora do Cabo in the harbour of St Denis in the Mauritius island group, and robbed the retiring Viceroy of Goa (Portuguese India), the Count of Ericeira, of £500,000 worth of diamonds and a further £375,000 worth of Indian and Chinese silks, porcelain and other precious goods from the East – a nice haul then and worth a king’s ransom now.
The final inventory of the Great Reichsbank Robbery, however, was destined to grow even longer. For on the day that General Spacil lifted nearly ten million dollars of loot from the Berlin Reichsbank vaults, the surviving contents of that bank reached their journey’s end. On 22 April the gold convoy from Berlin at last drew up outside the officers’ mess of the Mountain Infantry Training School at Mittenwald with an estimated 15 million dollars in gold and currency loaded on board its Opel-Blitz trucks. From that date forward the fate of this prodigious hoard of treasure has been a matter of intense mystery and speculation which has defied every kind of investigative enquiry. The true story of that extraordinary consignment – of the robbery, murder, racketeering, corruption, scandal and cover-up which it engendered, and which embarrassed an army and nearly shamed a nation – can now be told.
3. The Burial of the Treasure
The ancient frontier town of Mittenwald is one of the most attractive of the Alpine resorts of southern Bavaria. Strategically located at the head of the important Mittenwald pass through the mountains into the Austrian province of Tyrol, and superbly situated in the green valley of the Isar, the town is overlooked by towering Alps, densely forested on their lower slopes – Mittenwald literally means ‘middlewood’ or ‘in the middle of the wood’ – and in winter thickly covered with snow and heavily scored with ski slopes. The older quarter of the town presents an almost medieval appearance. The streets are lined by picturesque old houses with long, low-sweeping roofs and prominent eaves, and frescoed façades elaborately painted by local artists centuries ago. Dominating the middle of the town stands a candy-striped little baroque church of curiously Russian-looking design, with a tower vividly painted from top to bottom. Mittenwald is still, as Goethe once described it, ‘a living picture-book’.
The income of Mittenwald was – and is – derived almost entirely from the manufacturing of violins and from tourism and winter sports. In the last spring of the war neither of these activities was much in evidence. For though the town bore no scars of battle, the war had not passed it by. Throughout the region hospitals and sanatoria provided convalescence and ‘R & R’ for wounded soldiers from the front and exhausted U-boat crews in need of air. At Walchensee the Post Hotel had been leased by Nazi Party Secretary Martin Bormann, disguised as a hospital and turned into a refuge for SS officers and their wives. And only a few hundred yards from Mittenwald town centre stood the principal military installation of the place – the Kaserne, the barracks of the Gebirgsjägerschule, the Mountain Infantry Training School, a modern, white-walled training establishment, pleasantly situated among meadows of the Isar Valley at the foot of the fir-covered slopes of the Karwendel mountains.
The Mountain Infantry School for reserve officers and officer cadets at Mittenwald was one of several training establishments in the Bavarian Alps or the Tyrol where the Wehrmacht trained its troops in the special skills of mountain warfare. German mountain or Alpine troops – Gebirgstruppen or Gebirgsjäger – were an élite within the Wehrmacht. The German mountain soldiers, renowned for their skill, self-reliance and exceptional stamina, had fought with great distinction on many fronts throughout the war, sometimes in theatres of operation where they could exercise their special training and experience, more often in an ordinary infantry role on the plains and steppes of the Russian Front – and even against the British in the sands of the North African desert. On the snow slopes and the thickly wooded heights around Mittenwald Gebirgsjäger officer trainees were taught the esoteric arts of rock climbing, compass marching, mountain rescue and survival, shooting on skis, high-altitude combat, anti-partisan operations, the use of special mountain weapons and the handling of the usual Gebirgsjäger mode of transport – the pack mule. Such skills, needless to say, admirably suited the men of the Gebirgsjäger Training School – or more exactly, their instructors, the school’s officers – for the crucial task with which they were now entrusted, the hiding and safekeeping of the gold and currency reserves of the Reich. And it is doubtful if Funk or his assistant Schwedler could have handed the responsibility for the Reichsbank treasure to a more suitably qualified man than the school’s commanding officer, Colonel Franz Wilhelm Pfeiffer.
Colonel Pfeiffer looked every inch an honest and honourable soldier. He was 40 years old at this time, a tall, balding man of upright bearing and impeccable manners, with a highly developed sense of duty and responsibility to the men under his command. Unswervingly loyal to Hitler, Colonel Pfeiffer was a good German patriot and a distinguished front-line soldier who had won one of Germany’s highest awards for bravery, the Ritterkreuz (Knight’s Cross) – almost the equivalent of the British VC or the American Medal of Honour – in Greece in 1941. Pfeiffer had ser
ved in many theatres and fought and been wounded on many fronts. In Poland he had been shot through the leg by a dumdum bullet. After a disastrous encounter with the British at sea off Crete he had been hospitalised for many weeks. In Russia he had been shot through the spine during the siege of Leningrad and was lucky to be extricated from Russian encirclement with the remains of his regiment. Pfeiffer’s reputation as a soldier stood high. A semi-official history of the Brandenburg Regiments, one of which was commanded by Pfeiffer during the 1st Mountain Division’s campaign in the Balkans, described him at this time: ‘Day after day, in countless battles and engagements in northern Greece, Albania and especially Serbian territory, the 2nd Brandenburg Regiment under the prudent, energetic and caring leadership of its commander, Colonel Pfeiffer, inflicted on the enemy the heaviest possible losses in men and materials.’ In the bloody Battle of Belgrade Pfeiffer was wounded one last time, by a shot in the back of the head, during an engagement which virtually destroyed his whole regiment.
Colonel Pfeiffer’s fighting days were done. Like many other wounded veterans, he was posted to the gentler backwaters of a training command. He had had plenty of experience as a specialist instructor – at a military ski school near Salzburg, with an infantry division in Norway, with the Brandenburg Regiment (one of the first commando formations in Germany). Now Colonel Pfeiffer was posted to the Mountain Infantry Training School in Mittenwald.
He arrived there in December 1944, and it was there, on the night of 21/22 April, that he took on the most onerous responsibility of his entire military career.
Nazi Gold Page 7
