Chasing Gold: The Incredible Story of How the Nazis Stole Europe's Bullion (60 page)

The next morning, the two men were back working in the mine, when they learned that American forces would be moving into city shortly. Frommknicht told Thoms, “Let’s go to the entrance and see if we can slip away.” Frommknicht had a driver, and their plan was to leave immediately for Berlin. When the driver arrived, he locked the door to room #8 and gave the key to a guard. He then told Veick to go get his suitcase and return immediately to join him on the trip to Berlin. Veick left quickly, but by the time he returned to the mine, American soldiers had entered Merkers. Frommknicht and Thoms had also disappeared. A mine director said he’d seen them leave on foot, but added, “I don’t believe they will get far.”
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U.S. troops marching through the village just before noon on April 4 saw German civilians unloading bags out of a truck. The G.I.s stopped and asked what was in them, and the locals replied, “currency.” The Americans, though, just kept marching. In the mayhem of war, military units, displaced persons, prisoners-of-war, and civilians were all blending together.

At about 9:00 on Friday morning, April 6, U.S. soldiers Pfc Clyde Harmon and Pfc Anthony Cline were guarding a road about six miles from Merkers, when two women approached them walking through the village of Bad Salzungen about six miles from Merkers. A military curfew was in place, so they should not have been on the road, and that is when the soldiers met with the two women, one pregnant, who revealed the various activities that had been going on at the Kaiseroda mine. It was this mine where the women had seen Germans offloading gold and other valuable things. The next day, the G.I.s went to the mines, blasted the door blocking entrance to a storage room, and found hundreds of bags of gold as well as containers filled with jewelry taken from concentration camp inmates.
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Just before 8:00 P.M. that night, Reichsbank President Funk and his wife Luisa were at their rural home south of Munich in the village of Bad Tölz. Hitler had given the house to him in 1940 for his fiftieth birthday. They were listening to the BBC on the radio, even though that was illegal. BBC correspondent Robert Reed came on the air. The first thing he said was this was his 143rd radio report and that it had been censored. Then he announced: “This morning American soldiers working in a twenty-one-hundred-foot-square salt mine broke through a red brick wall and found one-hundred tons of German gold.”
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Luisa Funk said later that her husband was “heart broken” by the news and told her that everything was now “finished.” A general was supposed to have blown up the mine if enemy forces ever got close to it. The Nazi plan, Funk explained, was that it would have taken two to three years to excavate the gold, and that during that time Germany would be able to stabilize itself politically under Hitler’s leadership. The gold was going to be used to rebuild the country after the war.
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In Berlin that same night, Propaganda Minister Joseph Goebbels learned about the Merkers discovery from United Press, the American news service. He was furious and dictated to a secretary for his diary, “Sad news from Mülhausen in Thuringia. Our entire gold reserves amounting to hundreds of tons and vast art treasures, including Nefertiti, have fallen into American hands in the salt mines there.” He went on to rant against Reichsbank President Walther Funk, saying that the gold and art should never have been moved out of Berlin and that he had “always opposed” the transfer. Goebbels also complained that this had only happened because German trains had not run over Easter, the weekend before.
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Outside Paris the next day, Col. Bernard Bernstein, a member of General Eisenhower’s staff, was enjoying a late Sunday breakfast. He and Ike’s other aides had moved there from London after the liberation of the city the previous August. They were now working out of Louis XIV’s spectacular Versailles Palace in the
Grande Écurie
(Big Stable). As he walked away from his breakfast in the mess, Bernstein had under his arm a copy of
Stars and Stripes
, the GI’s daily newspaper. When he arrived at his office, he looked at the front page. The lead story was about the war in the Pacific and carried the headline “Carrier Planes Sink Japs’ Greatest Warship.” Just below that was a report about the European war with the headline “15 Mi. From Bremen.” It was a two-paragraph story in bold type, though, that captured Bernstein’s attention. The headline: “Reich Gold Hoard Captured.” The Associated Press reported that Third Army forces had found 100 tons of gold bullion plus large amounts of French francs and other currencies.
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Only a few minutes later, Bernstein received a phone call from General Frank McSherry, the deputy assistant chief of staff at Eisenhower’s headquarters, which was then located in Rheims, France. The general told Bernstein that General Patton had asked Eisenhower to take over responsibility for the gold. McSherry added that Eisenhower wanted his financial officer to assume charge of it and move the valuable cargo to a more secure location. McSherry then ordered Bernstein to get to Merkers as soon as possible. The original plan was for him to fly to Frankfurt/Main and then proceed by car to Merkers, only eighty miles away. But by then, it was too late in the day to fly that far, so Bernstein flew instead to Rheims to meet with both McSherry and General Lucius Clay, who was due to head the military government in Germany after the war was over. Bernstein met the generals the next morning, and at the end of their talk, Clay asked him if he had any questions. The colonel replied, “Only one, General. May I act as it seems to me to be wisest to do?” Clay replied, “Yes.” Bernstein then left for Frankfurt.
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Even before he got to Merkers, Bernstein had to decide whether to move the gold and artwork to the Ehrenbreitstein Fortress across the Rhine River from Koblenz or to the Reichsbank’s branch in Frankfurt. The fortification had been overlooking the Rhine since 1000 BC, and the current version dated back to the seventeenth century. After visiting both locations, Bernstein picked Frankfurt. Ehrenbreitstein was already full of documents, and it was also considered an inappropriate site for the art. Frankfurt, on the other hand, was a good place for storing both gold and art. An added plus was that the bank was only a mile from the I.G. Farben building, which had already been selected to be the U.S. army headquarters after the war.
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Bernstein then continued on to Merkers, where he visited the gold vault and interrogated two captured Reichsbank officials, Werner Veick, the head cashier of the Reichsbank’s Foreign Notes Department, and Otto Reimer, the chief cashier. Veick claimed that he didn’t know much about the gold, but said that Albert Thoms, who had been captured while trying to escape from Merkers, “knows all.” Reimer admitted that he and other bank employees had loaded one thousand bags of currency with the intent of taking them back to Berlin or to local Reichsbank offices. A bank official also revealed that they now had only about four tons of gold left in Berlin.
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Later that evening, Bernstein left for Patton’s headquarters. After the colonel explained the lay of the land in Merkers to the general, he said he thought the gold should be moved to Frankfurt. Patton confidently told the young subordinate that the Germans were not going to “push me” out of the area and that the gold could simply remain in the mine. Bernstein agreed that the Germans were unlikely to recapture Merkers, but added that under the recent Big Three agreements at Yalta, that area of Germany would be in the Soviet sector of occupation. Bernstein then added, “We certainly want to get all of this out of here before the Russians get here.” Patton was astounded with that information and immediately approved moving the gold to Frankfurt, where it would be safely inside the American zone. The Soviets later demanded that the gold be shipped to them, but Washington ignored the request.
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The following day, Bernstein returned to Merkers and interrogated Dr. Paul Rave, the assistant to the director of the Prussian state museums, who had accompanied the Berlin artworks to the mine. The Germans were cooperating, and everything was starting to fall in place.
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An advance team of the Allied monuments, fine arts, and archives unit had already arrived in Merkers on April 8. They were museum directors, curators, and art historians who were following just behind the conquering armies rescuing artworks that the Nazis had stolen from museums and private collections all over Europe. George Stout, who before the war had been an art conservationist at Harvard’s Fogg Museum, was the leader of the cultural operation. Although only a lieutenant in rank, he was the best American art man in uniform. He had landed at Normandy and traveled with troops rescuing priceless pieces of culture.

A minor turf battle quickly developed between Bernstein’s men and those of Stout. Was this primarily an operation to rescue gold or to protect art? Stout wanted his boss, Britain’s Geoffrey Webb, to come to Merkers to direct the art operation. When Patton learned of that, he sent an order telling Bernstein that this was to be an American-only project. “No damn limeys,” exclaimed the general. The arts men felt they were being treated as second-class citizens, while the gold guys were running the show. The art team, however, were professionals and went to work checking on the conditions in which the art had been stored and preparing to move their part of what had been found in the salt mines. In some cases, they found priceless pieces sitting in pools of water. Many paintings were wrapped only in brown paper, and a few had been ripped during transport.
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Bernstein and Stout together inspected nearby mines where they had been told more art had been stored. Berlin museum experts initially sent pieces to the Ransbach mine one hundred miles west, but the Americans decided it wasn’t an appropriate place and moved them to Merkers. Stout found forty-five cases that contained works by Dürer and Holbein as well as an estimated two million rare books. In the nearby Philippstal mine the Americans discovered countless more old books and maps. They also interrogated Dr. Shawe, a Berlin librarian who was responsible for manuscripts.
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When Bernstein returned to his housing on April 11 after a hard day in the salt mine, a message from Patton was waiting for him. It said that he should be at the entrance of Kaiseroda mine the next morning at 9:00. Bernstein dutifully followed orders, but no one showed up at the assigned time. Finally at about 10:30, a jeep pulled up. On the front was a plaque with five stars. That could be only one person: Five-Star General Dwight Eisenhower. Eisenhower and Generals Patton and Omar Bradley also hopped out of the vehicle. They were all there to inspect the Merkers mine. Bernstein led the group to an old wooden elevator shaft, an ancient contraption that carried them down to the bottom of the mine twenty-one hundred feet below. As the generals descended in the open elevator, Bernstein had a terrible thought: the guy operating it was a German! Bernstein, though, didn’t say anything. Patton quipped that if the cable snapped, “Promotions in the United States Army would be considerably stimulated.” Eisenhower shot back at the irrepressible Patton, “OK, George, that’s enough. No more cracks until we are above ground again.”
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With Bernstein as their guide, the generals toured room number eight. The original press report of 100 tons of gold had vastly underestimated the cache. There was probably double that and more, but no one knew for sure because they could only count the number of bags and suitcases. Perhaps to relieve their tension, the generals returned to joking. Bradley told Patton that if they were still in the “old freebooting days, when a soldier kept his loot, you’d be the richest man in the world.” Patton didn’t say a word, and just grinned. The artworks didn’t impress Patton much. He wrote in his memoirs, “The ones I saw were worth, in my opinion, about $2.50, and were of the type normally seen in bars in America.”
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Bernstein explained that the suitcases were filled with gold and silver items perhaps taken from concentration camp inmates. The generals already knew about the camps since U.S. forces four days before had liberated a slave labor camp in the nearby village of Ohrdruf. At one point during their tour, Eisenhower saw some writing in German on a wall and asked if Bernstein could translate it. The colonel, who knew Yiddish, replied that it said, “The State is Everything and the Individual is Nothing.” Eisenhower muttered to himself that he found that an appalling doctrine. The generals stayed underground for an hour. There had still been some talk of shipping all the gold and artworks to the U.S., but Bernstein told them that he favored moving everything simply and quickly to nearby Frankfurt. The brass agreed.
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Following the visit to the Kaiseroda mine, the three generals and officers accompanying them went to Ohrdruf to tour the death camp. “It was the most appalling sight imaginable,” Patton later wrote. The group saw a table where inmates had been whipped; forty naked bodies were now stacked on it. Nearby there was a pyre made of railroad ties. Patton later wrote with disgust, “In the pit itself were arms and legs and portions of bodies sticking out of the green water which partially filled it.” The war-hardened Eisenhower wrote in a letter to General George Marshall, “The visual evidence and the verbal testimony of starvation, cruelty and bestiality were so overpowering as to leave me a bit sick.”
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The group ended the day at Patton’s headquarters, where the generals stayed up late talking about the horrific scene they had just witnessed. The need to loosen up after the visit to the concentration camp got them back to joking. Eisenhower asked Patton what he’d do with all the gold. Never at a loss for words, Patton replied there were two schools of thought among his men: one group thought that it should be made into medallions with one going to “every sonuvabitch in Third Army.” The other wanted to hide it and use it to buy weapons the next time Congress cut the army’s appropriation. Eisenhower looked over to Bradley and said, “He’s always got an answer.”
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