Nazi Gold

by Douglas Botting

  The question is: what gold? There is one possible explanation. When the Reichsbank treasure was originally buried at Walchensee, a consignment of 25 boxes of gold – stated to be bullion – were buried with it, but only 20 boxes, containing not gold bullion but gold coins, were recovered. If the 25 boxes had, in fact, contained not bullion but coins, it followed that 5 boxes of coins were missing – though in the confusion surrounding the Reichsbank gold and currency recoveries this is difficult to determine exactly. Whatever the grounds for suspicion, they seem to have been sufficient to impel the Americans to launch an intensive investigation into the matter of the missing Reichsbank reserves.

  12. The Boys from the CID

  It was an extraordinary quirk of fate that General Patton, commander of the Third United States Army and one of America’s most acclaimed military leaders, should be burdened with responsibility for the Reichsbank treasure twice in the space of three months. It was Patton’s Army that had first stumbled on the main part of the Reichsbank hoard at the Merkers mine in April 1945, and Patton himself had been one of the first Americans to set eyes on this prodigious wealth. It was again Patton’s Army, after fighting its way across Germany from one side to the other, that came across a second hoard of Reichsbank treasure – or what was left of it – in the area of Mittenwald in June, and Patton himself who initiated the investigation into the mysterious circumstances surrounding its recovery and disappearance. In an earlier chapter we have seen how the gold and foreign currency located in the hills above Lake Walchen by Hitler’s former security officer, Colonel Friedrich Rauch, was brought to Patton’s headquarters at Bad Tölz on 29 June 1945 by a squad of Third Army Military Police and how the general, in the salty and unequivocal language that was so characteristic of him, outlined his proposals for future action in that connection: ‘I want those civilian bastards handed over to the Criminal Investigation Department, and see to it that an investigation is started to find out what happened to the rest of this hoard. I don’t want anybody ever to say that sonuvabitch Patton had stolen any part of it.’

  It was thus in Patton’s office, in an order bawled through an open door in a former SS barracks, that the long, tortuous, baffling American investigation into the Reichsbank affair had its origins. The series of successive and overlapping enquiries were to take the best part of four years and involve just about every investigative agency that the Americans could bring to bear on the case – the CID, CIC, CCD, FBI, Inspector General’s Department, Public Safety Branch, Military Government Special Branch and Theater Provost Marshal. They were to focus on Garmisch and gold and spill over into Munich and narcotics. They were to use the whole weight of the Army and every trick in the book, and yet by the time they had finished Patton would be long dead, the treasure would have vanished, the birds would have flown and the Pentagon would be sweeping the records under the carpet. The whole sorry saga could be seen as a farce, were it not for the extent of the crime, corruption and incompetence that were laid bare in the process, and the impermeability of a mystery that survived to the very end.

  Many of the problems that confronted the investigators were inherent in the nature of the American Occupation. At the end of the war the Allies had envisaged that for an indeterminate period – perhaps for 20, perhaps even for 50 years – Germany would be ruled as an occupied enemy country until such time as it was fit to rejoin the community of nations. Germany was roughly quartered into four zones, each zone occupied by the forces of one of the victorious Allied Powers – the Russians in the east, the British in the north-west, the French in the south-west and the Americans in the south. Initially the Commander-in-Chief and Military Governor on the American side was General Eisenhower, but in reality he was more of a prestigious figurehead, who had won his spurs in war rather than government, and the effective day-to-day running of the American Zone of Germany fell on the shoulders of his Deputy Military Governor (who later became Military Governor and later still Commander-in-Chief as well), General Lucius D. Clay – the dominant Allied arbiter of western Germany’s destiny in the hiatus period between the death of the Third Reich in 1945 and the birth of the autonomous Federal German Republic in 1949, the period covered more or less exactly by this book.

  In the first year and a half after the war the American presence in Germany – which bore the generic title of United States Forces, European Theater (or USFET for short) – was divided in two; the US Army and the US Military Government, known as OMGUS (Office of Military Government, United States). Under OMGUS headquarters in Berlin came the Military Government of the three southern provinces of Bavaria, Hesse and North Würtemburg-Baden and the northern port enclave of Bremen which made up the American Zone. The one for Bavaria – which comprised half of the American Zone and generated three-quarters of its problems – was usually known as OMGB, which stood for Office of Military Government, Bavaria and was run by a succession of Military Governors with varying degrees of talent and success. The entire occupation was an improvisation and the people that ran it were an improvised bureaucracy. In this respect the American Zone resembled the British, French and Soviet Zones. There simply was no precedent in history for four civilised nations governing a fifth as absolute rulers. Given such unique circumstances, it is not greatly surprising that the new rulers of Germany – certainly those in the US Zone – were unable to devise in advance a system of government that was adequate to cope with the unimaginable difficulties confronting it at the end of the war. ‘The apparently unanimous judgement of contemporary critics,’ one American academic historian of the Occupation wrote recently, ‘is that the Occupation suffered mightily from defects of organisation, from beginning to end and from top to bottom. The most obvious defect was the abyss between Military Government and the Army.’

  Military Government was supposed to rule through German agencies, while the Army was intended merely to provide troops as enforcers. In reality the Army got in the way of both Military Government and the fledgling German civil service. The tactical army units continued to behave as if they owned their areas and the conflicts that sprang up between the two sets of Americans in uniform – the Military Government and the Army proper – threatened to undermine the authority of the Occupation.

  American investigative units were not exempt from this jealousy and estrangement. Thus the Criminal Investigation Division (CID), which was responsible for investigating major crimes committed by or against members of die United States Army, was part of the Army’s Corps of Military Police under the command of the Theater Provost Marshal. On the other hand, the Counter Intelligence Corps (CIC), whose primary function was the protection of the US occupation against espionage, sabotage and subversion within the boundaries of the US Zone, was largely responsible to Military Government, though in practice it was often involved in the same cases as the CID.

  There was not only jealousy between Army and Military Government agencies but a severe lack of co-ordination between them. These two broad compartments of the American occupation were vertically structured, with few lateral connections from one to the other. Many local Military Government commanders considered themselves perfectly free agents, ignored directives from above and (in the words of one contemporary critic) operated in ‘a variety of feudal kingdoms in which they ruled supreme’. They were not entirely to blame. The channel of communication between the people at the bottom of the hierarchical pyramid and their peers at the top was a clogged and faltering one. Policy and plans tended not to filter down to the men in the field. The action and intelligence reports from the men in the field jammed somewhere in the bottlenecks on the way to headquarters in Frankfurt and Berlin. In other words, it was as difficult to liaise and co-operate within one chain of command as it was between one chain of command and another.

  No wonder the numerous agencies that investigated the Reichsbank robbery (and other matters) found themselves either working in ignorance of one another’s findings or trampling over one another’s evidence. Conflicts led to
poor intelligence. ‘Germany was deluged with intelligence teams and commissions of inquiry of every possible description,’ wrote one former intelligence officer. ‘In this general mêlée and struggle for information, organised intelligence work became impossible. Various groups worked at cross-purposes, information was not exchanged.’ Even General Clay, the Governor of the US Zone, was forced to accept the criticism that the intelligence agencies were not functioning well. Intelligence from both the Army and the CID was not satisfactory, since it was largely the product of men who were simply good at languages and hated Germans – many of them Jews of German origin or east Europeans from countries which had suffered under Nazism. Military Government intelligence was little better because it came mostly from German sources, was often faulty and could not be checked by the Americans themselves.

  Human factors complicated the competence of the American Occupation as a whole and the success of the investigative agencies in particular. There was a high rotation of personnel, a constant reshuffling of officials as new men took over who were unfamiliar with the local situation, did not know what had happened under their predecessors, and would themselves be replaced as soon as they had mastered their jobs. A French historian of post-war Germany wrote of OMGUS: ‘With very few exceptions, they lacked really first-class men.’ Most Americans were reluctant to serve overseas. Few saw the occupation as a long-term career prospect. The most experienced and best qualified men were usually the ones with the most ‘points’ and among the first to return to the States for demobilisation. Military Government was only allowed to offer one-year contracts and a top salary of $10,000 per annum; many of the more able men in the occupation felt they could not afford such short-term and relatively low-paid work, and returned to America as soon as they could to establish themselves in more permanent careers with brighter prospects. Those that were left were either men from the Regular Army or career employees from Federal departments and agencies who were obliged to serve wherever they were ordered; or else they were men who had volunteered to stay on because they doubted their competence to obtain as good a job at home and had a vested interest in the German scene, with its lucrative black market and sex on tap – ‘the wine, women and song boys’, as one OMGUS political adviser once described them.

  The CID, who bore the initial responsibility for investigating the Reichsbank robbery, had its full share of Occupation types. A provisional wartime organisation of screened and trained men drawn mainly from Military Police organisations, the CID at the end of the war consisted mostly of men counting the days until they could go home – preferably before Christmas, or sooner. Replacements were recruited from available military personnel and even from civilian life. ‘The background checks of some of the people who had slipped in via overseas recruiting was interesting,’ wrote one CID permanent employee. ‘Several had criminal records, while others were discredited police officers, etc. Naturally these people were kicked out, but what did they get away with while they had the badge?’ The same source has provided, with others, a series of pen portraits of some of his colleagues from that time, a rich gallery of Occupation types, some good, some bad, all of them only too human. Here is a cross-section (with their names omitted for obvious reasons):

  In my opinion he would have done the Nazis real credit. Corrupt.

  A real jerk. Was a former Ohio State Trooper and thought in terms of uniformed patrols. Had no idea of investigations of anything more complicated than a traffic accident or a hold-up.

  Formerly a Lieutenant in the Nazi Gestapo, later a Master Sergeant in the US Army CID. Before the war he had to flee for his life following a quarrel with Gestapo Chief Reinhard Heydrich. After internment in England, he emigrated to the USA, renounced his hereditary Prussian tides of Baron and Count, and was drafted into the American Army. As he was fluent in German, French and Russian, incredibly well connected with the German nobility and with many Nazi widows, including Frau Goering, he proved a very valuable ClD Agent. He was used exclusively for high-level cases and was outstandingly successful.

  A fine man. Honourable and supportive of his men. He had studied for the priesthood at one time. Later went to the air force and was killed in a plane crash in Alaska.

  An odd character, a real funny guy. He was a sapper in the British Army in World War Two, and joined the American Army CID in Algeria in 1943. An orthodox Jew, he spoke seven languages including fluent Arabic, but in English spoke only in the third-person. He had many friends in high places and seemed to play a lone hand most of the time. There was a rumour that he was an agent of the Zionist underground. His sister’s first name was Tel and his was Aviv – allegedly because he was the very first Jewish male child to be born in that town after its foundation.

  One of the fair-haired boys. A handsome man who created a good first impression, but he was all façade. A compulsive drinker and gambler. Had been a policeman in Miami, Florida.

  Was only 23 years old, but mature beyond his years. Very able and diplomatic. Later became a full colonel.

  Such was the range of individual types within the organisation that from the fall of 1945 was burdened with the task of solving the mystery of the Reichsbank treasure. But in eccentricity no CID man in Germany came anywhere near a particular Command Provost Marshal, who had the ultimate authority over the CID. A former CID agent recalled this controversial personality, who seemed to have stepped straight out of a novel by Evelyn Waugh:

  Brigadier-General George H. ‘Pappy’ Weems was a West Point officer. His basic branch of service was the horse cavalry. He was supposed to have been a brilliant young officer in that branch, but apparently he was unable to keep up with changing times and thus was not absorbed into the armored force. As a senior officer he was given staff assignments and prior to being assigned to Germany he had been head of the military mission to Hungary. He had no background in police work whatsoever and even less of CID. In fact, he never seemed to be able to comprehend why he had soldiers who weren’t wearing uniforms and living in barracks.

  It seemed apparent that Weems had had some kind of stroke. He walked with a cane, had a faulty memory, seemed to have trouble comprehending anything of a complex nature and was given to issuing outrageous orders. (Oh, yes, I almost forgot – he was hard of hearing!) He was obsessed with the idea that there was some sort of international conspiracy to steal typewriters and any case involving the theft of a typewriter had to be brought to his attention. He had me confused with an agent named Zeron and used to refer to me by that name. However, he didn’t like to be corrected. Colonel Karp told me, on one occasion when I had to brief Weems on a case, that Weems would call me Zeron. He said not to pay any attention, because if I interrupted Weems’ train of thought he would go into a tantrum. In other words, he was prematurely senile, probably as a result of a stroke. I doubt that he was dishonest, and any meddling he did was as a result of befuddlement. [Lieutenant-Colonel William A. Karp, on military leave from the US Secret Services, took command of the CID in September 1947.]

  Just because a man was a provost marshal or commander of a Military Police battalion or an agent of the CID was no guarantee that he had any capability or expertise. In the field of police operations, much less that of complex investigations. So often what may have seemed dishonesty was actually incompetence, though there were some arrogant types who felt that because in essence they were the law, they were above the law and could do as they pleased.

  The best that could be said about the CID’s problems was that at least they were all-American. The problems with the CIC, the other main investigative body concerned with the Reichsbank robbery and the scandals of Garmisch, were far more exotic. The CIC was in a constant state of internal feud. Many of its agents were German-born and most of these were Jewish. There were two main categories of Jews in Germany and in the CIC: the western-oriented and the eastern-oriented. Broadly, the western sect viewed their Jewishness as a matter of religion and cultural heritage and considered Germany as their home, notwi
thstanding the holocaust brought about by the Nazis in that country during the Hitler years. The main concern of these western Jews was to root out the Nazis and see Germany become a democratic state to which they could one day return as their rightful homeland. The eastern Jews, by contrast, had their roots in Poland and Russia and were mostly Zionist who saw the future state of Israel as their ultimate home. These eastern Jews considered themselves to be little more than temporary birds-of-passage in Germany and hoped to see that country crushed for ever. The presence of feuding Jewish sects within the ranks of the CIC in Germany, and of first-generation Poles, Czechs and other agents of east and central European origin, led not only to divided loyalties and internal stresses inside the Corps but to opportunistic and illegal alliances outside of it. The CID, a rather more professional outfit, tended to look askance at the CIC. ‘I tried to stay away from the CIC,’ confirmed one CID agent, ‘because they were a bunch of bums as far as I was concerned. They were a bunch of hooligans.’ Another CID agent, reporting back to his superiors about conditions in Garmisch, noted sarcastically at the end of his report: ‘All black-market investigations were being made by units of the CIC. I have nothing to add to this statement.’ All these motley factors had their effect on the success (or otherwise) of the investigations into the Reichsbank affair and have a bearing on the final outcome of this long and complex story.

  Such, then, were the outfits that were unleashed by the Americans on the Reichsbank case and the Garmisch affair between 1945 and 1949. Excessively compartmentalised, with no clear overview, no overall direction, no central co-ordination, no master file, no watching brief, blundering about in the half-light and the dark, not knowing what they were looking for, getting in one another’s way and on one another’s nerves – no wonder one of the first and best of the investigators, Walt Snyder, described the Reichsbank case succinctly thus: ‘It was a fucked-up mess!’