Nazi Gold

by Douglas Botting

  However, the question of missing Nazi gold had a brief public reappearance in April 1985. A new but obscure book entitled Raubgold aus Deutschland (‘Looted Gold from Germany’) was published in Switzerland. This was the first publication to examine the relationship between looted gold, the Reichsbank and Switzerland. Drawing on the country’s own banking records the book attracted considerable media interest for a short time. In fact, Ian Sayer was interviewed on the BBC’s World At One programme over these new revelations. However, our knowledge of the stolen gold which the Reichsbank had exported to Switzerland was fairly restricted, as our book Nazi Gold was concerned mainly with the disposition of the gold bullion and other treasure which remained hidden in Germany at the end of the war. The intriguing revelation over the Reichsbank’s gold deposits in Switzerland was to surface once more before it finally developed into an international scandal in the summer of 1996.

  In 1989 the authors became aware of the publication of a new book entitled Hitler’s Gold – the Story of the Nazi War Loot, a scholarly (and difficult to find) appraisal written by an American history professor, Arthur L. Smith, who had compiled an extremely definitive account of the Reichsbank’s transactions in looted gold and the economic uses it was put to during the war. Much prominence was given to Germany’s gold dealings with Switzerland and the Allied plan, code named ‘Safehaven’, set up in an attempt to prevent neutral countries trading in or laundering looted Nazi gold. We were pleased to note that Nazi Gold featured in Professor Smith’s sources, but disappointed to see that Professor Smith chose to deliver a neatly veiled side-swipe in our direction when he complained that books on the Second World War and post-war gold – his own apart, naturally – were generally thin on documentation, thick with unsubstantiated hearsay, purveying an air of mystery while preserving the impression of documented exposé. Professor Smith could not have known then that we were destined to claim the honour of tracking down and returning to its rightful owners the last two bars of gold bearing Nazi markings. Nor was he in a position to appreciate then that our continued perseverance and 23-year investigation would prove to be the catalyst for the 1997 London Conference on Nazi gold.

  Though we were the catalyst, the prime mover in the campaign to unravel the mystery surrounding the whole subject of Nazi gold in its broad context was the World Jewish Congress (WJC), based in New York. In 1995 the Congress stepped up its pressure to persuade the Swiss authorities to reveal the existence of dormant bank accounts which had originally been opened by Jews who subsequently became victims of the Holocaust. Although discussions with the Swiss on this subject had taken place on several previous occasions since the end of the war, American political pressure and will had not been forthcoming, By the mid 1990s, however, the political climate had changed dramatically, and in early 1996 President Bill Clinton himself was persuaded to intervene. His first step was to appoint Stuart Eizenstat, the Under Secretary of State who acted as the US special envoy for property restitution in Central and Eastern Europe, to conduct an inter-agency investigation to evaluate the evidence against Switzerland. The search for dormant assets had become inextricably linked with another quest – that of the ultimate disposition of the $378m (1945 value) of looted gold which Nazi Germany had shipped to Switzerland between 1940 and 1945. The US investigation was carried out under the auspices of the Department of State. Lasting seven months and involving 11 government agencies, 15 million pages of documentation were reviewed in the National Archives before the preliminary study was published in May 1997.

  It was the WJC’s tireless spin doctoring of ‘newly released classified documents’ that finally embarrassed Switzerland into revealing the existence of bank accounts opened by Holocaust victims – a revelation that quickly led to an international clamour for Switzerland to repay the current monetary value of the looted gold it had received from Germany during the war. All this was food and drink to the European newspapers, which seized on and then embellished a whole series of sensational stories in which Switzerland was invariably labelled as a fully fledged wartime Nazi collaborator, both politically and morally. The fact that the vast majority of the ‘newly released classified documents’ had been available for some 20-odd years escaped the entire media circus. We were in possession of some of these documents as long ago as 1978. Some of them are noted in the sources of Nazi Gold.

  The European media campaign began in the early spring of 1996. By the end of July the chairman of the Holocaust Education Trust, Greville Janner (now Lord Janner), was featuring in news stories with straplines such as ‘UK Accused Over Nazi Gold’ and ‘Britain Knows Swiss Kept Nazi Stolen Gold’. The focus of Janner’s claim was the apparent revelation that in 1946 the Allies had accepted a proposal by Switzerland that they should only be required to hand over a very small proportion of the gold they had received from Germany during the war. The fact that an agreement of this nature not only existed but had been published by the government and was referred to in a number of academic reference works for several decades seems to have been overlooked in the mad dash for the statutory conspiracy theory. This was considerably assisted by British Foreign Minister Malcolm Rifkind, who initially flatly denied that Britain had participated in such a deal. It was to be some time before embarrassed Foreign Office officials were able to point to the 90-odd British government files which the public had been able to read without let or hindrance for the 20 years since they had been declassified.

  Unfortunately, the media’s desire for Swiss blood coloured their thinking to such an extent that the quest for increasingly lurid and sensational headlines only served to underscore the complete lack of a brief but detailed account of the basic story. In reality the World Jewish Congress’s original revelations related to an agreement formerly known as The Washington Accord. Signed in 1946, this agreement accepted that in return for a payment of $58.4 million of gold, America, Britain and France would drop their post-war claim for the return of all gold received by Switzerland from Germany during the war (namely some $400 million). The original basis for this claim was an American message to the Swiss in 1944 which stated America’s categorical refusal to ‘recognise the transference of title to the looted gold which the Axis holds or disposed of in world markets’. This was a clear warning not to accept gold from Germany that may have been looted from occupied countries. Since all looted Nazi gold exported to Switzerland during the war had been resmelted to the Reichsbank format, the Swiss could argue – as they did – that they had not handled any looted gold. However, all European Central Banks – including the Swiss – were aware of the approximate value of Germany’s pre-war stocks i.e. about $200 million. German transfers to Switzerland during the war totalled in excess of $400 million (i.e. more then twice the amount of Germany’s pre-war reserves). The Swiss must therefore have realised that they were trafficking in looted gold. Current estimates indicate that the looted element of the $400 million may be as high as $335 million.

  What never became clear to the international media (and consequently the public) was that by 1996 the Swiss were not still concealing vast quantities of Nazi gold in Zurich bank vaults which had remained untouched since the end of the war. If the Swiss had received $400 million (exaggerated to $500 million in the media) and had only returned $58m this simply proved that the Swiss still had $342 million in their vaults – equivalent to $5 billion in 1996 money.

  According to a 1985 report in the Wall Street Journal, the reality was actually very different. The gold shipped from Germany to Switzerland was actually sold for Swiss francs. The Swiss banks, essentially, were acting as commission agents. The proceeds were credited to the Nazis’ Swiss account. Part was used to purchase Swiss arms but the bulk was used to make payments to the central banks of Portugal, Spain and Romania – countries which initially refused to accept German gold, probably as a result of having received similar warning messages from the Americans. Whatever the real situation was, in 1996, the Swiss announced that their entire earnings from their
wartime gold trade with Germany amounted to a mere 20 million in Swiss francs (or about 4.64 million in US dollars). In 1996 there was no looted gold hoard in their vaults. But looted gold still existed – and it was much closer to home.

  The publicity generated by Greville Janner at the end of July brought us back into the Nazi gold arena once more. The title of our book had been widely circulated in the media, government offices and other institutions around the world and was now about to be adopted as a generic term. However, there were still new leads to follow. Although we had concentrated on looted gold found in Germany by the Allies (rather than looted gold traded through the auspices of the Swiss) we knew that media interest was gathering momentum and that media interest sometimes moves mountains.

  By the beginning of August Janner’s ‘revelations’ had disappeared from the headlines. But a chance lunch with Sunday Times lawyer Alastair Brett, who had so ably assisted us in persuading the State Department to launch their investigation over a decade earlier, effected an introduction to Sunday Times Insight team editor Frank Kane. After explaining the basis of Nazi Gold, Kane asked if we had anything new which might help to keep the momentum initiated by Janner going. Sayer explained that while we could not contribute much to the Swiss story, there were two ongoing issues which remained unresolved.

  The first related to the State Department investigation into the two Belgian bars. Kane was fascinated and telephoned the State Department to enquire into the progress of their 1983 investigation. Unbelievably, Kane established immediate contact with Ely Maurer, the State Department’s Assistant Legal Adviser, who had been heading the investigation. As to the status of the investigation Maurer was both succinct and unforthcoming.

  ‘Ongoing,’ he told Kane. Kane was puzzled. ‘Ongoing?’ he replied, incredulous. ‘For 13 years?’ the Sunday Times realised they had been put on to something big. But there were even bigger fish yet to fry.

  The second related to the matter of the Albanian gold. Our original challenge to the government on the Albanian gold issue and the dealings of the Tripartite Gold Commission in 1984 still remained unresolved 12 years later. Here was a golden opportunity to resuscitate it. As Ian Sayer began to relate the story, Kane began to see front-page headlines. In the run-up to the exclusive he was preparing for the Sunday Times issue on 11 August, he persuaded the Foreign Office to widen its continuing investigation into Britain’s participation in the collection and disbursement of looted gold by including the seven tonnes still sitting in the Tripartite Commission’s Bank of England account. Next he contacted Greville Janner. After learning of the existence of the Tripartite Commission’s hoard, Janner repeated our 1985 call to Jeff Rooker to allocate the remaining gold to a needy cause – but this time Janner specifically suggested that it should be used for the benefit of Holocaust survivors and their families.

  Around the time of publication, rumours had begun to emerge that some of the gold recovered by the Allies and placed in the Tripartite Commission’s gold pot originated from Nazi concentration camps, where it had been stolen from Jewish prisoners or in some cases extracted in the form of gold dental fillings. Sayer explained that our research had clearly indicated this to be the case as far back as 18 years ago. But he pointed out that the quantities were tiny in comparison with the overall quantities involved and that in any event it would be impossible to establish definitively, nearly half a century later, whether or not any of the bullion still held in the Bank of England and in the US Federal Reserve Bank contained ‘tainted’ gold.

  On 11 August 1996 the Sunday Times ran the story, though not as the world-exclusive front-page splash the story deserved in the context of the current campaign. A couple of weeks later the story made a brief reappearance when the London Evening Standard ran a headline story based on a ‘newly declassified document’ uncovered by the World Jewish Congress, which alleged that British forces had recovered two tonnes of looted gold which originally formed a part of the Nazi Foreign Office’s gold reserve. There was no evidence, the story said, that the two tonnes had been handed over to the appropriate authorities (i.e. the Tripartite Commission). Other newspapers ran similar articles. Readers of Nazi Gold were already aware of the position regarding the Foreign Office gold (see the section on Ribbentrop’s gold) and we immediately wrote to British Foreign Secretary Malcolm Rifkind offering to provide additional documentation which might assist in dealing with the allegations. No reply was received and interestingly that particular story has never surfaced either officially or unofficially since its only appearance in August 1996.

  Picking up the story next was the Independent on Sunday. On the 8 September 1996 they ran a half-page feature entitled ‘Nazi Gold Trail turns Fiction into Fact’. This article focused on the activities of Elan Steinberg, the executive director of the World Jewish Congress and outlined his investigation which culminated in the appointment of a joint Swiss Bankers Association-World Jewish Congress commission under the former chairman of the US Federal Reserve Paul Volcker to investigate Swiss records relating to dormant bank accounts of Holocaust victims and Switzerland’s wartime gold trading activities with Nazi Germany.

  This long overdue operation is both a noble and worthy cause but it was born on a wave of international publicity generated by a lack of specific knowledge on the subject. The Independent article concentrated on the origins of Steinberg’s investigation. From this we learn that it was not until February 1995 that the World Jewish Congress realised that the US National Archives contained two tonnes of documents relating to Operation Safehaven. ‘We were astonished,’ said Steinberg. ‘None of us had ever heard of Safehaven. We assumed that if the US or British governments had records of assets stolen by Nazis we would have been told.’ When Steinberg asked why the documents had never been shown, the archivist allegedly replied that nobody had asked to see them. It seems curious to us that the Congress had not come across the best-selling Nazi Gold, for within its pages they would have found a wealth of details on the Nazi wholesale looting of European gold reserves and its subsequent disposition. They would also have been able to review the primary documentation on which our account was based, much of it emanating from the US National Archives! We were also surprised that neither the World Jewish Congress, the US National Archives nor myriad journalists who evaluated and reported on this story in 1996 had come across Arthur Smith Jr’s Hitler’s Gold – The Story of the Nazi War Loot published in New York in 1989. From the early 1980s Professor Smith had reviewed not only the ‘secret’ British files in the Public Records Office but those of the German Bundesarchiv and Institute for Zeitgeschichte, together with declassified documents ‘first’ seen by Steinberg’s researchers more than a decade later. The mysterious ‘Operation Safehaven’ is given a whole chapter by Smith and the chapter title was ‘Safehaven’.

  Two days after The Independent article the Foreign Office produced a report entitled ‘Nazi Gold – Information from the British Archives’. This document detailed the extent of Britain’s knowledge relating to Switzerland’s wartime financial dealings with Germany and Britain’s role in the recovery and disposal of looted gold formed in Germany at the end of war.

  A simple transcription error by the Foreign Office historian gave rise to a forest of headlines the next day. In 1945 the American estimate of looted gold held in Swiss banks was $400 million. The Swiss let slip a figure of 500 million in Swiss francs ($125m) but the Foreign Office transcribed this as 500 million dollars instead of Swiss francs. Since the Swiss had made a payment of $58 million, most of the papers believed the balance was still in Swiss bank vaults. While this erroneous hue and cry was going on Malcolm Rifkind agreed to press the Swiss on the issue during a visit to Switzerland the following week.

  One section of the Foreign Office report concerned ‘Gold Found in Germany’. The concluding paragraph was as follows:

  The occupying forces and their investigatory teams followed up all leads, but were well aware that they were unlikely to uncover all g
old hidden in Nazi Germany. What they found, however, was gathered together, mostly at Frankfurt, and unless clearly identifiable was later used for the gold pool to be distributed by the Tripartite Gold Commission established in 1946.

  This official government statement is one which we emphatically challenge. It is blatantly untrue, as will be seen later.

  On the day the Foreign Office released its report, Ian Sayer was asked to appear on Sky News and BBC World Television News. He took the opportunity to address some of the inconsistencies in the media coverage and to call for a further investigation, but this time in relation to the looted gold which disappeared from the US Occupied Zones of Germany after its recovery by US forces.

  For us the story continued. September 1996 saw the publication of Op JB (short for Operation James Bond) by first-time author Christopher Creighton. The book had been rejected by a number of publishers before Simon and Schuster bought it, reputedly for the breathtaking sum of £500,000. Originally billed as true and still carrying a non-fiction label, the book was fronted by a publisher’s preface which concluded by saying that the reader would have to make up his own mind as to whether or not he believed it. This incredible piece of claptrap was treated with scepticism by most reviewers but, despite this, nobody bothered to unequivocally prove it. The awe-inspiring storyline goes something like this.

  Op JB is an account of how the author, Christopher Creighton, and intelligence officer (and future creator of James Bond) Ian Fleming, together with what is described as a ‘commando unit’, rescued Hitler’s private secretary and eminence grise, Martin Bormann, from the Reich Chancellery bunker in May 1945. This operation was alleged to have been authorised by Sir Winston Churchill, King George VI and President Roosevelt in order to secure the return from Switzerland to its rightful owners of vast quantities of gold, works of art and other Nazi assets which were apparently controlled solely by Bormann on behalf of the Nazi Party. After signing over his Swiss gold and bank accounts to the Allies, Bormann was granted refuge in England where he lived, under an assumed name, until his death in 1989.