Krueger's Men (32 page)

A N
OTE ON
S
OURCES

L
AWRENCE
M
ALKIN AND
M
ARGARET
S
HANNON

T
he Nazi counterfeiting scheme has been public knowledge since newspaper accounts began appearing during the last months of World War II. Its enormity soon became evident as experts followed Allied troops to assess the danger to U.S. currency as well as the damage to British finance. Since then, the story has become as barnacled in myth as the sunken German warship
Bismarck.
Too many details descend from overheated, secondhand, and often self-promoting accounts circulated by officials who tracked the counterfeits, treasure hunters, imaginative journalists, East German propagandists, and even former Nazis peddling their own versions. Many have made their way onto the Internet as fact. One British writer claimed in 1961 that “most of the story’s protagonists are dead,” although they were not. He declared he had therefore “imaginatively reconstructed” some unrecorded events. Unfortunately, he neglected to distinguish between events that were fact and those that were imagination. This book represents our best efforts to scrape away the barnacles of such myths by telling a tale whose essential fascination is enhanced by being true.

The success of Operation Bernhard depended on secrecy, and that alone kept German records sparse. The SS also wanted all traces buried (or murdered). Our sources are primarily diplomatic cable traffic and contemporaneous documents of the investigations conducted by Allied intelligence officers, currency specialists, and officers of Scotland Yard’s counterfeit division. Their reports were based heavily on interviews with the prisoners that were conducted within weeks or months of their escape. The prisoners’ own drama unfolds mainly through memoirs, most of which were unknown or simply ignored by earlier writers. None was more valuable than
Falskmynter i blokk 19,
by Moritz Nachtstern and Ragnar Arntzen, published in Oslo in 1949. This virtually forgotten book was discovered on the Internet by Margaret Shannon with the help of the remnants of the Norwegian language she picked up during her childhood years in Oslo. We thank Anne Synnevaag of Norwegian Public Radio for obtaining permission from Nachtstern’s son Jan to quote from an English translation. She also led us to his daughter Sidsel, who explained how he wrote the book, which was republished in Norwegian in 2006.

Another important source was the fragments of Bernhard Krueger’s reminiscences, principally via interviews with Murray Teigh Bloom, whose own meticulous investigation was the first by an American writer. His fascination with our discoveries was undiminished by his age (approaching ninety), and his support and assistance for this project never wavered even when it disproved his own account of Salomon Smolianoff’s role as Krueger’s principal forger of sterling.

The author, Lawrence Malkin, has known the outlines of this story since he began reporting on finance from London in the 1960s. Margaret Shannon, senior research historian of Washington Historical Research, was the associate producer and principal researcher of an effort begun in the late 1990s to locate and return Nazi assets believed to have been looted and dumped in the Toplitzsee. It was financed by the Simon Wiesenthal Center and the Columbia Broadcasting System, and we are grateful to Rabbi Marvin Hier, dean and founder of the center, for permission to draw on Shannon’s research. In 2002 Malkin was referred to her by Wayne deCesar, the U.S. National Archives specialist in the records of the U.S. Secret Service, which is the principal anticounterfeiting agency of the United States.

Thereupon followed three years of collaborative research, with Shannon principally uncovering official correspondence and reports, cables, intercepts, letters, diaries, film footage, captured documents, transcripts of interrogations, and photographs in various archives. Many of these documents have been available for thirty years to researchers willing to look for them. Others have been declassified only recently. Under the U.S. thirty-year rule, most OSS documents were not systematically reviewed for declassification until 1976, well after the first accounts of Operation Bernhard had been written. Only in the first years of this century did the CIA declassify its files on Wilhelm Hoettl, Friedrich Schwend, and Georg Spitz. The timing was fortunate for this book and is the direct result of the Nazi War Crimes Disclosure Act of 1998, which requires all U.S. federal agencies to identify and declassify records related to Nazi war crimes. More than 8 million pages of documents were declassified, some directly related to Operation Bernhard.

Missing from the U.S. Secret Service archives, however, is File CO 12,600, which contained the voluminous Secret Service master files on Operation Bernhard. Bloom was allowed to view the files privately at the U.S. Treasury and referred to them in his writing as “The Amstein Report” after André Amstein, the chief of Switzerland’s anticounterfeit police and his country’s representative to Interpol. According to the U.S. Secret Service archivist Michael Sampson, File CO 12,600 was “destroyed in a routine purge.” Herr Amstein, a lawyer in private practice in Bern, wrote in 2002 refusing an interview on the grounds that he was an old man, remembered little, and had no documents from the period. This made it necessary to reconstruct the contents through archival research.

Among captured German records at the National Archives in Washington is one invaluable document: the 1942 and 1943 telephone directories of the RSHA, which helpfully list the division, building, and room number for its employees. By extrapolating from the names of those who worked in Amt VI F, we were able to confirm the identities of those who worked in the counterfeiting operation, its chain of command, and even who worked in what office. (Have you ever wondered why the Pentagon telephone book is classified?)

We have already singled out several people who contributed heavily to our research, but they are far from the only ones who have made this book possible. Our most essential guide was the historian and archivist Robert Wolfe, who for more than thirty years was chief of captured German records at the U.S. National Archives. Although officially retired in 1995, Wolfe remains actively engaged with documents covering German and Japanese war crimes. As a National Archives volunteer with Top Secret clearance, he has repeatedly given us wise and generous counsel about documents, and candid assessments of the credibility of many of the personalities, living and dead, who figure in this book.

At the Bank of England, the newly appointed archivist Sarah Millard and her staff helped breathe fresh air into this history by showing us files whose existence at the Bank had simply been denied by her predecessor. The British National Archives at Kew is a researcher’s dream, computerized and efficient in delivery; we regret that its staff remained as anonymous as it was unfailingly helpful and courteous. Tim Hughes, a professional researcher based in nearby Twickenham, initiated us into the rules and procedures during a two-week research visit in 2003. Meanwhile, Professor Alan Milward, economic historian at the British Cabinet Office, helped point the author toward essential Treasury files.

At the U.S. National Archives, we are deeply grateful for the assistance in our search of intelligence and military records of Timothy K. Nenninger, Lawrence H. McDonald, and the legendary John E. Taylor. Among the archivists and historians overseeing civilian records, we thank Milton Gustafson, diplomatic historian, and Greg Bradsher, director of the Holocaust-Era Assets Records Project. Wayne deCesar cheerfully made repeated searches in the compressed shelving that houses the U.S. Secret Service records. In the microfilm reading room, we benefited enormously from the diligence of a former archivist, Neils Cordes, who unearthed Smolianoff’s Mauthausen record and conclusively established the date of his transfer to Sachsenhausen. Edward Barnes, Elizabeth Lipford, and Louis “Smitty” Smith located records in places they were not supposed to be. John Fox, newly appointed historian of the Federal Bureau of Investigation, and Michael Sampson, archivist/historian of the U.S. Secret Service, went beyond the call of duty to assist us. At the Franklin D. Roosevelt Presidential Library, which is part of the National Archives, Robert Clarke took great pains to locate John Steinbeck’s correspondence and to find pages in the voluminous
Morgenthau Diaries.
Susan Shillinglaw, director of the Steinbeck Center of San Jose State University, helped us find further traces of Steinbeck’s encounters with FDR.

Fiona Fleck, an intrepid journalist based in Geneva and friend of the author’s family, navigated the shoals of the Swiss bureaucracy with the invaluable help of Ruth Stalder of the Swiss Federal Archives in Bern and Claudia Wassmer, a lawyer for the Swiss police (Bundesamt für Polizei), who released in a most unbureaucratic manner some documents that might otherwise have remained sealed for several more years.

Batya Leshem of the Central Zionist Archives did research we could not do ourselves without a trip to Jerusalem. Hans Coppi of Berlin carefully conducted the author on a tour through the remains of the Sachsenhausen concentration camp, now a museum, and Winfried Meyer, then the museum’s director, provided valuable leads.

The author also acknowledges — and can never sufficiently thank — the assistance of a number of friends and colleagues in breaking down inevitable bureaucratic barriers or providing advice and information when needed, often on short notice. Chief among them is Sir Derek Mitchell, formerly director of overseas finance for Her Majesty’s Treasury, who has supported this project from its inception. So has David Kahn, dean of American cryptographic historians, whose invaluable assistance continued right through to a careful reading of the manuscript, which was also checked by Andrea Merrill. Others are Paul A. Volcker, Michael Bradfield, Stuart Eizenstat, Peter Jay, Yuval Elizur, Curtis Roosevelt, Shareen Brysac, Sanford Lieberson, William McCahill, Robert Wernick, the German writer Melissa Mueller, James Nason of the Swiss Bankers Association, Michael Rose of Interpol, Nathalie Moreau of the Colmar Archives, Nadine Coleman of Paris, Anne Makkinje of Amsterdam, Peter Bakstansky of the Federal Reserve Bank of New York, and Michael T. Kaufman and Michael Vachon, respectively the biographer and the spokesman of the financier George Soros. Ingeborg Wolfe, Jaakov Lind, Toby Molenaar, and Tina Vogel assisted with translations.

Finally, no book is ever realized without unseen hands that hold and shape it. Lianne Kolf of Munich, the author’s European agent and summer neighbor, nurtured and stood by him when others had deserted the project; she staunchly continues to do so. The author’s friends, his American agent, Thomas C. Wallace, and his lawyer Louis Atlas, defended this project against all who would stop it. The author’s wife, Edith, closer to the subject of wartime survival than most, nobly endured her husband’s entangling obsessions. Helmut Ettinger, the book’s German translator, served as a meticulous guarantor of accuracy and quality, and the author thanks his German editor, Elmar Klupsch, for generously providing his services and much else. Likewise Peggy Freudenthal, Little, Brown’s chief copyeditor, who saw this book and its complex scholarly impedimenta to press with meticulous skill and great charm. Geoff Shandler, editor in chief at Little, Brown, a colleague on several previous books, and a valued friend, offered imaginative structural advice and meticulous textual skill of a kind that has almost vanished from today’s publishing world but, as long as he practices his craft, will continue to enrich the lives of authors and readers alike.

March 2006