[Congressional Record Volume 142, Number 55 (Thursday, April 25, 1996)]
[Senate]
[Pages S4253-S4256]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




ALLEGED SWISS COLLABORATION WITH THE NAZIS AND THE SMUGGLING OF GERMAN 
                      LOOTED PROPERTY TO ARGENTINA

  Mr. D'AMATO. Mr. President, I rise today to discuss an issue that 
continues to trouble me, namely that of the role played by Swiss banks 
and their continued retention of assets belonging to European Jews and 
others before and during World War II.
  In a document from the State Department, entitled, ``Nazi and Fascist 
Capital in Latin America,'' dated March 23, 1945, found at the National 
Archives, details Nazi capital infiltration of Latin and South America. 
Yet, within the report, there are sections which explain the role of 
the Swiss bankers in helping to secret Nazi assets out of Europe. At 
this time, Mr. President, I ask unanimous consent that this report be 
printed in the Record.
  The relevant part of the report states that,

       ``Accusations have also been voiced that Nazi German 
     capital is escaping in Swiss diplomatic pouches, probably 
     without the knowledge of the Swiss federal government, 
     because of the government's practice of entrusting diplomatic 
     missions to its bankers and businessmen traveling to the 
     Western Hemisphere.''

  If this is true, it suggests that Swiss bankers might have directly 
help get Nazi assets out of Europe to Latin and South America. This 
revelation could lead to serious questions about the sincerity of the 
Swiss bankers with regard

[[Page S4254]]

to Jewish assets in their possession, as well as those of the Nazis. 
Where did all of the money go? That is what the Banking Committee will 
try to find out.
  The report follows:

               Nazi and Fascist Capital in Latin America

       Ever since the Nazis and the followers of Mussolini began 
     to lose confidence in their ultimate victory, they started to 
     establish safe refuges for their capital in neutral 
     countries. The object of these transfers is only, in a minor 
     degree, for the purpose of establishing coches for their 
     loot, for the purpose of enjoying a comfortable old age, with 
     personal and economic security, such as that of Kaiser 
     Wilhelm II in the Netherland town of Doorn. The main purpose 
     is the reestablishment of German industrial and financial 
     power or influence in countries from which they could again 
     attempt to dominate the world, first economically and later 
     politically.
       These transfers are being accomplished by various methods. 
     Most of them are being made by the intermediacy of neutral 
     countries. A great deal of capital, British and United States 
     currency, jewels, and technical secrets and stock 
     certificates have been transported from Germany to neutral 
     Switzerland, Spain, Tangier, and Portugal, and from there to 
     the final destination, largely to neutral Argentina where the 
     capital is expected to enjoy safety from any Allied 
     interference. Spanish Falangists, aristocrats, and 
     businessmen have been helping in these transfers, with their 
     voyages from Spain to Argentina. These activities gained 
     momentum in 1944.
       In Spanish ships and German submarines, as much as possible 
     of Germany's capital, American and other currency of the 
     Allied nations, confiscated by the Nazis, inventions, 
     technical personnel, officers, and machinery has been sent to 
     Latin America, including some industrial plants complete with 
     administrators. A typical example was the arrival in 
     Argentina, at the beginning of 1945, of the heads of the 
     CHADE (Compania Hispano-Americana de Electricidad), Juan 
     Ventosa y. Calvet and F.A. de Cambo. The heads of the 
     Deutsche Bank and the Allgemeine Elektrizitats Gesellschaft 
     figure prominently on the board of directors of CHADE which 
     controls electric light and power for the city and province 
     of Buenos Aires. Before his trip to Argentina, Ventosa y. 
     Calvet was seen several times in Berne and Montreux, 
     Switzerland, in the company of Hitler's financial advisor, 
     Dr. Hjalmar Schacht. That is one example of how the Argentine 
     Government has managed to speed up the development of war 
     industries. In that way, Fritz Mandl, former Austrian 
     munitions manufacturer, organized his armament factories in 
     Argentina. Collaborators with German investments in Argentina 
     are: Gen. Basilio Pertine, Dr. Arnold Stoops, Guillermo 
     Schulenberg, Max Kleiner, Federico Curtins, Dr. Alejandro 
     Czisch, Fernando Ellerhorst, Dr. C.E. Niebuhr. All of them 
     are members of the board of directors of the most 
     important German, or German-controlled, companies in 
     Argentina: Siemens Bauunion, Siemens Schuckert, Osram, 
     Wayss & Freytag, Bayer, Allgemeine Elektrizitats 
     Gesellschaft, known as A.E.G., and many others.
       The main German investments include banks, such as the 
     Banco Aleman Transatintico and the Banco Germanico de la 
     America del Sud; insurance companies, such as La Germano 
     Argentina, Compania de Segures Aachen y Munich; construction 
     companies, such as Siemens Bauunion; electric machinery 
     companies, such as the half-dozen subsidiaries of Siemens-
     Schuckert, and Siemens & Halske; chemical companies, most of 
     the subsidiaries of I.G. Farbenindustrie, such as Quimica 
     Bayer S.A., Quimica Schering, Quimica Merck Argentina, 
     Anilinas Alemanas; machinery distributors, such as Compania 
     de Motores Otto Deutz Legitima S.A., Sociedad Tubos Mannesman 
     Ltda., Aceros, Roechling-Buderus, S.A., Aceros Schoeller-
     Bleckman, S. de R.L. and many others.
       Accusations have also been voiced that Nazi German capital 
     is escaping in Swiss diplomatic pouches, probably without the 
     knowledge of the Swiss federal government, because of the 
     government's practice of entrusting diplomatic missions to 
     its bankers and businessmen traveling to the Western 
     Hemisphere.
       The vast fortunes of Nazi party leaders and industrialists, 
     sent out of the Reich for safe-keeping to neutral countries, 
     but mainly to Buenos Aires, are ready to resume business 
     through Germany's industrial and chemical cartels in new 
     headquarters as soon as Germany surrenders. The alleged or 
     Swiss aid to Germany in these matters is believed to have 
     contributed to Russia's refusal to attend last year's 
     international Aviation Conference in Chicago because of the 
     presence there of Swiss and Spanish delegates.
       The personal fortunes of Nazi officials, including Hermann 
     Goering, Joseph Goebbels, Robert Ley and others, are said to 
     be reaching Geneva via German diplomatic pouches, and from 
     there--it is alleged--they are sent to Buenos Aires.
       The Nazis once used Spanish diplomatic pouches in Venezuela 
     and other countries to send strategic materials like 
     industrial diamonds and platinum home from South America. 
     Before Argentina broke its official ties with Germany, the 
     Nazis sent vital materials to Berlin in their diplomatic 
     pouches and received large shipments of such diverse items as 
     propaganda, short-wave radio transmitters, and the blueprints 
     for war weapons now produced in several Argentine arms 
     plants, notably that of the former Austrian munitions king, 
     Fritz Mandl.
       Another method of obtaining allied or ``free'' currency in 
     neutral countries, a method which furthermore obviates the 
     necessity--often involving a certain risk--of smuggling 
     currency, valuables, or stock certificates into neutral 
     countries, was extortion from Germans living in neutral 
     countries. The system of extortion, which the Nazis had 
     employed on a world-wide scale during that year, was based 
     upon the sale of exist permits from Germany and occupied 
     territories. Persons seeking such permits were compelled 
     to persuade their relatives or friends in the Western 
     Hemisphere to place at the disposal of the Nazis large 
     sums of ``free'' currency of the neutral powers. At the 
     same time, residents of the American Republics were 
     informed that their relatives or friends in Germany, or in 
     territories occupied by it, would be sent to concentration 
     camps or subjected to other tortures if the specified sums 
     of money were not paid within a fixed period of time. 
     Through this procedure, many persons in Europe, who had 
     ties of friendship or relationship with residents of the 
     New World, were held as hostages pending the payment of 
     ransom in the free currencies.
       The fortunes in securities, bullion and cash transferred to 
     the Argentine capital are only part of the sums being 
     invested abroad for the Nazi hierarchy by banks of neutral 
     countries. International financial speculators have invaded 
     the United States, Argentina, and Panama to assist the 
     Germans in one of the greatest mass exodi of capital ever 
     known. United States Government agents have successfully 
     blocked the activities of a number of these speculators but 
     have as yet been unable to do anything about the misuse of 
     diplomatic immunity of neutral countries. Such neutral 
     diplomatic pouches are passed without inspection on Spanish, 
     Portuguese, and Swiss merchant ships at the British control 
     stations in Gibraltar and Trinidad.
       It is reported that Reichsmarshal Goering lately used this 
     method to transfer personal funds. According to these 
     reports, Goering previously sent more than $20,000,000 of his 
     personal fortune to Argentina via the Dresdener Bank of 
     Berlin and the Schweizer Bankverein of Geneva. His 
     representative in Argentina is Dietrich Borchardt, a German 
     of Argentina citizenship, who not long ago visited the United 
     States and engaged in financial transactions.
       Goering is also reported to have transferred some funds to 
     Argentina by a Nazi submarine which in the Spring of 1943 
     surfaced near Mar del Plata on the Argentina coast and 
     transferred some forty boxes to a tugboat of an Axis-owned 
     line in Buenos Aires. Part of that money is said to have been 
     invested in the ``Electro Metalurgica Sema'' arms plant in 
     Buenos Aires which Goering recently sold to the Argentine 
     government for $5,000,000.
       One of the latest reports is the discovery that Nazi 
     Propaganda Minister Joseph Goebbels has $1,850,000 in United 
     States money in a safety deposit box in a German-controlled 
     bank in Buenos Aires, under the name of a friend of German 
     origin there.
       Foreign Minister Joachim von Ribbentrop has a large sum 
     deposited in the name of his cousin, a German named Martin, 
     who recently received $500,000 from a Swiss bank from the 
     account of the Nazi diplomat.
       Admiral Karl Doenitz, chief of the German Navy, has an 
     undisclosed sum in the care of a relative, Edmundo 
     Wagenknecht, owner of one of the largest German import and 
     export firms in Argentina.
       Robert Ley, Chief of the Nazi Labor Front, recently bought 
     a large farm near Bahia Blanca, Argentina, under the name of 
     Franz Borsemann, a trusted Nazi friend.
       It is estimated that in 1939 German investments in Latin 
     America amounted to at least 150 million dollars or 16 
     percent of the total foreign investment of Germany. This 
     figure does not include the capital belonging to persons of 
     German lineage or capital employed by those who had acquired 
     an American citizenship while maintaining Nazi contacts and 
     sympathies. It consists of those investments whose ownership 
     is known to be German, hence it is a minimum figure. Much of 
     this, although small in proportion to British and United 
     States holdings, was effectively and intensively organized 
     and integrated into the Nazi political system.
       When the Germans overran almost all of continental Europe, 
     they seized many millions of French francs, Dutch guilders, 
     Belgian belgas, Norwegian and Danish kronen, Czech korunas, 
     Polish zlotys, and a great deal of American and British 
     currency found in the banks of these countries. They 
     transported or transferred them to neutral banks, and from 
     there much of it went to South America, mainly to Argentina. 
     This money was partly used for the purpose of expanding Nazi 
     controlled industries in these neutral countries.
       According to some Argentine estimates, the Germans have 
     $750,000,000 cashed or invested in South America, including 
     their pre-war investments.
       During the war, these investments have been considerably 
     increased through the infiltration of German capital.
       ``Anilinas Alemanes'' (German Anilines), which is part of 
     the huge German dye trust, is an example. According to 
     figures registered by this company with the Argentine

[[Page S4255]]

     government, its capital there in 1940 was 5,000,000 pesos. In 
     1943 it was 9,600,000 pesos, the balance having been invested 
     from abroad during the war. Although the company officially 
     was cut off from all supplies from Germany during that 
     period, its 1939 profits of 69,453 pesos had soared to 
     1,731,847 pesos in 1943.
       German government officials ``bought'' millions of dollars 
     in Argentine securities from their owners in occupied Europe, 
     giving the victims worthless German paper money or securities 
     in exchange. The Argentine securities thus obtained have been 
     sent to Buenos Aires for safe-keeping. Future attempts of the 
     victims to recover these Argentine securities will be a 
     difficult, if not impossible task.


                        Previous Commercial Ties

       Industries and commercial houses operated by Germans in 
     Latin America conducted their activities as though 
     nationalized by the Third Reich, in the interest of the Party 
     and often with little regard for financial profit and 
     ordinary business enterprise. Commercial enterprises such 
     as retail and wholesale distribution, importing and 
     exporting, commodity brokerage, and drug compounding and 
     distribution were the types preferred for German 
     investment. More than half of the German capital in Latin 
     America was invested in this field of endeavor.
       The largest and most extensive investments were made by 
     Germans in Brazil. Here the basis for a thriving trade in 
     German and Brazilian commodities existed as a result of a 
     large colonies of Germans in Brazil which had been 
     established under the leadership of the Hanseatic 
     Colonization Company beginning in 1887. Most of these early 
     colonists were farmers and laborers and as their economic 
     status became stronger and more prosperous, German 
     industrialists, traders, technicians, and small capitalists 
     were attracted to the country. Thousands of farms owned by 
     Germans and citizens of German descent and in 1939 an 
     estimated 40 million dollars in German capital was invested 
     in commercial houses. German traders maintained the closest 
     of ties with Germany, dealing principally in German goods and 
     in products specially prepared, packed and shipped from 
     Brazil to German markets. These strong commercial ties were 
     fully utilized by the Nazi party organization not only to 
     extend the party network but to provide powerful financial 
     support.
       Similar commercial penetration occurred throughout Latin 
     America reaching a position of dominance in Chile, Colombia, 
     and Bolivia. In 1939, German investments in commercial firms 
     in Chile were estimated at 16 million dollars, in Colombia 9 
     million, and in Bolivia 5 million. German business agents 
     covered the area reaching remote districts with products of 
     German industry and seeking commodities in exchange. Easy 
     credit terms were extended, personal favors granted, and 
     buyers tied to sellers by means of continuing obligations. 
     Such firms as Bayer, Becker, Elsner, Kyllman, Swertzer, and 
     Zeller operated prosperously and with extensive credit 
     furnished by banks with German connections. With typical 
     thoroughness the Germans extended their control until 
     dominance was achieved in many fields. In Uruguay a Nazi 
     gauleiter named Delldorf used the firm of Lahusen and Company 
     as a center of party espionage. This firm with other German-
     owned and controlled units dominated the wool export trade of 
     the country. The financial strength and commercial prestige 
     of these firms enabled them to exert effective powers over 
     press and radios; a power which was fully used.
       In addition to these strictly German investments there were 
     substantial capital holdings in the hands of local citizens 
     of German descent with Nazi sympathies and connections. In 
     Colombia alone there were an estimated 225 firms of this type 
     with capital aggregating about 5 million dollars.


                        Agricultural Investments

       Second in size to German investment in commercial 
     enterprises were German land holdings in Latin America. In 
     Argentina, German colonies were established, principally in 
     Patagonia. More than half of the population in this area was 
     foreign, the Germans numbering 15,000. Several of the richest 
     and most extensive land holdings in Patagonia were dominated 
     directly or indirectly by powerful German interests. The 
     Germans lived here as Germans speaking their own language, 
     retaining German customs, schools, and religion, celebrating 
     German holidays, and spreading a continuous flow of Nazi 
     propaganda. The area was virtually a Nazi State, followed the 
     party line, and kept alive the issue of creating a separate 
     State.
       In Peru, Gildermeister and Company with home offices in 
     Lima and Berlin operated under the name of Negociacion 
     Agricola Chicama, Limitada (formerly Casagrande Luckner 
     Plantagen, A.G.). In 1939 this firm owned the largest sugar 
     plantation in the world (more than 1.5 million acres) and 
     controlled the production of more than half of all sugar 
     produced by Peru. The capital investments of this firm were 
     estimated at about 20 million dollars; it possessed its own 
     private seaport, Puerto Chicama, but the total quantity and 
     composition of exports and imports which flowed through the 
     port is a matter of conjecture. Gildermeister maintained 
     close ties with the Nazis, one of the Gildermeister brothers 
     serving as the Peruvian ambassador in Berlin until 1942. The 
     concern employed German as well as native personnel, and 
     dominated completely the economy of the Chicama Valley.
       In Central America, notably Guatemala and Costa Rica, 
     German land holdings were substantial. In Guatemala, German 
     capital controlled about 60 percent of the coffee acreage and 
     the amount invested was estimated at 20 million dollars. 
     Similarly, in Costa Rica about 5 million dollars of German 
     capital was invested in coffee and sugar plantations.


                           Banking Interests

       Ranking third in size, the German investments in banking in 
     Latin America were of considerably greater importance as 
     instruments of Nazi control then might appear from their 
     capital. German personnel was strategically placed in local 
     banks; correspondent contacts were developed and maintained 
     on an extensive scale; loans to institutions of strategic 
     importance and to governments were made and the dominant 
     motive was often clearly political rather than economic.
       In every report or news dispatch from South America, two 
     banks have been named as the key transmission-belts for 
     financing German enterprises in Latin America: the German 
     Overseas Bank (Deutsche Ueberseeische Bank) and the German-
     South American Bank (Deutsche-Suedamerikanische Bank). 
     The former--its Spanish name is Banco Aleman 
     Transatlantica--is under the control of the Deutsche Bank, 
     the largest private bank in Germany, with eighteen 
     branches in Argentina, Brazil, Chile, Peru, and Uruguay. 
     Its board of directors contains, besides the heads of the 
     Deutsche Bank, the director of the Krupp combine, Dr. 
     Busemann; the general director of the potash trust, Dr. 
     Diehn; and representatives of the Steel Trust and of 
     Siemens-Schuckert, one of the two largest electricity 
     trusts in Germany. The German Overseas Bank has interests 
     in the Central Banks of Argentina, Chile, and Peru.
       The majority of shares in the German-South American Bank 
     (Banco Germanico de la America del Sud) belong to the 
     Dresdener Bank, Germany's second largest private bank. Here, 
     too, the Krupp combine is represented in the person of 
     Krupp's brother-in-law, Baron von Wilmosky. Hermann Buecher, 
     chairman of the board of AEG, Allgemeine Elektrizitats 
     Gesellschaft, the largest German electricity trust, is also a 
     director of the bank. Consul Heinrich Diederichsen, head of a 
     large Hamburg import and export house, is a director of the 
     bank; while his son, utilizing the money of the German-South 
     American Bank, plans a very important role in the fascist 
     Integralists movement in Brazil.
       German banks were of notable importance in Argentina, 
     Brazil, Colombia, and Chile, operating with numerous branches 
     and controlled from Berlin. The former Banco Italiano (now El 
     Banco Credito del Peru) was a 10 million dollar Axis 
     institution which dominated the banking business of Peru. It 
     has such power that few important steps, affecting government 
     finance or of major economic importance, were taken without 
     consulting the officers of this institution. Through 
     selective financing, it controlled the public utilities and a 
     substantial number of private business interests in Peru.


                     Investments in Transportation

       The major German investment in Latin American 
     transportation was made in airlines. The systems developed in 
     strategic areas. The principal lines, Condor, Lufthansa, 
     Sedta, Varig, Scadta, and Lloyd Aero Boliviano, operated 
     largely with German personnel (some of whom were officers in 
     the Nazi Army) and systematically mapped the strategic areas 
     of Latin America. This subject is treated in a separate 
     section of this report.
       German shipping companies forced to suspend business 
     activities as a result of the British blockade did not close 
     their offices but in many cases expanded and opened new 
     offices to carry on propaganda functions.
       The Compania Union Industrial de Barranquilla was the only 
     shipbuilding firm in Colombia for the river trade. Its 
     control was German, most of its personnel was German and 
     nearby property and business was owned or dominated by 
     Germans.


                            Public utilities

       Though direct financial investments by Germans in public 
     utilities in Latin America were small, Germans held key 
     positions in many utility concerns, notably Argentina; and in 
     Uruguay, the German firm, Siemens, contracted to build a 
     great hydroelectric power and distribution system at Rio 
     Negro using German technicians and German equipment and 
     installations. The entire technical personnel of the electric 
     plant in Quito was German. The chief engineer on this project 
     was Walter Giese, a Nazi gauleiter who established in Ambato 
     a powerful Nazi radio transmitting station.


                  transfer of italian fascist capital

       The Italian Government in Rome, cooperating with the Allied 
     Commission, seized and sequestered Fascist estates valued at 
     $80,000,000 in liberated Italy. But high-ranking Fascists are 
     said to have smuggled between $400,000,000 and $500,000,000 
     into neutral countries, most of which is the result of 
     wholesale looting.
       Edda Mussolini, the Duce's daughter and widow of Count 
     Ciano, executed Fascist Foreign Minister, escaped to 
     Switzerland and is credited with having stored away more 
     pillage than any other Italian Fascist.

[[Page S4256]]

       Other nations where Fascists have succeeded in hiding funds 
     include Portugal, Argentina, and Brazil, according to an 
     Allied Commission official.
       Italian ``epuration'' (purge) officials are not 
     investigating a report that Mussolini himself hid some loot 
     in the United States.
       Mussolini's family, including children and grandchildren, 
     his mistress, Clara Petacci and all of her family, comprise 
     sixteen names of 267 whose estates in liberated Italy have 
     thus far been sequestered. Not all of the 267 are Fascist 
     leaders. Some are simply profiteers and war contract 
     swindlers.


                    Swiss Bankers and German Capital

       Three members of the Swiss delegation of the International 
     Business Conference, held at Rye, N.Y., in November 1944, 
     made several attempts to induce the U.S. Treasury Department 
     to rescind its ruling that the true ownership of all funds 
     deposited by Swiss banks in this country be revealed within 
     one year after hostilities cease in Europe. The Swiss banking 
     system in which numbers designate accounts instead of names, 
     makes it enormously difficult to trace secret or hidden 
     funds.
       According to sources having connections in Geneva and 
     Buenos Aires, the reason for Swiss bankers; anxiety to evade 
     disclosure of their clients, names is the fact that Swiss 
     banks have for several years been aiding in the transfer of 
     immense fortunes of Nazi leaders and their European 
     collaborators to the United States, Spain, Argentina, and 
     Brazil.
       The Swiss Committee, headed by Edmond Barbey of Lombard, 
     Odier et Cie., includes Andre Fatio of Ferrier, Lullin, and 
     F.H. Bates, all representing the Union de Bancs Suisses (The 
     Swiss Banking Association). They are basing their plea on the 
     Swiss banking tradition of absolute secrecy concerning their 
     clients' accounts--or even of the fact that the account 
     exists.
       At present Swiss funds deposited in the United States 
     anonymously are blocked by the Treasury Department which 
     promises to release them upon definite proof that they do not 
     belong to enemy aliens or war criminals.
       The chairman of the Swiss delegation to the International 
     Business Conference was Hans Sulzer of Gebrueder Sulzer in 
     Geneva (and a branch in Frankfort-on-Main, Germany), who was 
     on the British blacklist. (Charged with supplying Diesel 
     engines for Nazi submarines, Sulzer hotly replied, ``They 
     were not for submarines!).
       In allowing men like Sulzer and their bankers the cloak of 
     diplomatic immunity, the Swiss government has, probably 
     unwittingly, enabled German leaders like Goering, Goebbels, 
     and von Ribbentrop to spirit huge funds abroad. For centuries 
     Swiss banks have been confidants of men who want to keep 
     their financial transactions secret. A banker is forbidden by 
     the Swiss constitution from disclosing his clients' 
     maneuvers. He would rather go to jail than do so.
       The Swiss Banking Association is therefore doubly anxious 
     to induce the United States to refrain from insisting on 
     postwar disclosure of the names of its depositors here. 
     Besides being forced to confess their relations with war 
     criminals, they will have lost the advantage of secrecy which 
     has enabled them to vie in world influence with the greatest 
     banks.

                          ____________________