France

The "credit" balance of the Bank of France under the Franco- German clearing established on 14 November 1940 amounted to 4,400,000,000 RM as of September 1943 (3615-PS). The clearing

[Page 1071]

arrangement was designed, of course, principally for the financing of exports, that is, for purposes not related to the needs of the occupation army. (EC-619)

Coercion in the establishment of the Franco-German clearing is readily demonstrable. Extreme pressure was brought to bear, particularly in regard to the rate of exchange established in the agreement, by threatening to cut off communications between "occupied" and "nonoccupied" zones in France (3602-PS; 3603-PS), a step which would have destroyed the last vestige of economic order in France. The harsh terms of the agreement, which required the Bank of France to make immediate payment for exports to Germany regardless of the balance of trade, fixed the rate of exchange at 20 francs to the mark (as compared to 10 to 1 before the war), and gave Germany a unilateral option to cancel at any time, forcibly suggest that the agreement would not voluntarily have been accepted. (EC-619)

Holland

The clearing system between Holland and Germany was of short duration, being cancelled effective 1 April 1941, when free transfer of Reichsmarks to Holland was introduced. (See infra, D, (5).) It is therefore not deemed of sufficient importance to warrant discussion at this

(3) The Nazi conspirators unlawfully took over the gold reserve of the National Bank of Belgium and the Netherlands Bank in the interest of the German general war effort.

Belgium

The gold of the National Bank, deposited with the Bank of France and transferred to Dakar, was brought to Berlin pursuant to German-French "agreement" in the amount of 545,700,000 RM (ECR-149), and there deposited with the Reichsbank in Berlin (ECR-24). Because of the "high demands on gold and foreign exchange" which led to a "considerable straining of the reserves" (EC-401), the "Reich Government felt itself required to lay claim to the gold of the National Bank for the Reich" (ECR-149). A decision to proceed by requisitioning under paragraph 52 of the Hague Regulations (EC-401) was not executed, apparently because of fears on the part of the Reichsbank that title thus acquired would not be recognized (ECR-115). On order of Goering (ECH- 5, part 9, Annex XIII), the gold was then "requisitioned on 19 September 1942 by the Oberpraesident of the Province of Mark Brandenburg for the Deputy of the Four-Year Plan, on the basis of the Reich Contribution Law (Reichsleistungsgesetz)

[Page 1072]

of I.IX.1939 (Sec. 16, paragraph 1, No. 5, and Sec. 2a)" (ECR-1149).

Holland

As shown above, part of the Dutch "voluntary" contribution to the "war against Bolshevism" was paid in gold. The gold was, in fact, taken from the Netherlands Bank. (EC-401)

(4) The Nazi conspirators unlawfully compelled the nationals of the occupied countries to surrender and offer for sale all precious metals ad foreign exchange to the local central banks, which delivered them to the German Reichsbank.

Belgium

By German decree of 17 June 1940 and administrative orders issued pursuant thereto the Belgians were required to surrender gold and foreign exchange notes to the Emission Bank, which in turn, delivered the loot to the Reichsbank (ECR-24).

By May 1943, the Reichsbank had acquired in this fashion gold and foreign exchange of the value of 23,400,000 RM. (ECR-149)

Holland

Gold and foreign exchange delivered by the Netherlands Bank to the Reichsbank "on the basis of the direction of the Reichsmarshal" (Goering) amounted to 74,000,000 RM through November 1940. (EC-465)

France

It is believed that the same practice was followed in France, but evidence as to details has not been found in the German documents presently available.

(5) The Nazi conspirators issued German Reichsmarks as currency in the Netherlands, for purposes unrelated to the need of the occupational troops, which currency they caused to be freely exchanged for gulden by the Netherlands Bank. The Nazi conspirators, animated in part by the view that the Netherlands were "akin in blood to the German nation" (3613- PS), sought to promote a "mutual interpenetration of the German and Netherlands economies" through the acquisition by Germans of Dutch participations (EC-468) and Dutch investment in German securities. (ECR-174)

To this end, restrictions on the free transfer of Reichsmark and gulden across the German-Dutch border were removed. Conversations between the Reich Economics and Finance Ministers in October 1940 led to the first step in this direction, the issuance by the Economics Minister of a Circular (Runderlass) -- No.

[Page 1073]

89/40 -- which produced substantial changes in the foreign exchange control along the German-Dutch borders (EC-468). This provided, inter-alia, that RM 1,000 or its equivalent in gulden could be taken across the German-Dutch border by travelers or in border trade without permit, and permitted Germans to transfer to Holland up to 5,000 RM per person per month for any purpose except purchase of goods without any permission (EC-468).

These relaxations were made effective in Holland by free exchange of Reichsmarks for gulden by the Netherlands Bank, introduced "on the initiative" of the Commissar, and by enforced acceptance of Reichsmark currency by the Dutch business population. (EC-468)

The Reichsmarks thus made available in the Netherlands were mainly used to purchase Dutch securities on the stock exchange (EC-468). Permission to make such purchases was extended to a large number of German banks by the German Ministry of Economics. The transfers were made with "reluctance" by the Dutch, in connection with which the Reich Commissar at the Netherlands Bank observed, "it may be pointed out with some justification that an out-payment of gulden made against a Reichsmark credit, which can only result through the burdening of the Netherlands State credit, represents no genuine transfer" (EC-468) .

Notwithstanding the objections of the then Commissar at the Netherlands Bank (EC-468), circular 87/40 was soon followed by No. 29/41 of 31 March 1941, which abolished almost completely all restrictions on the free use of the Reichsmark in Holland (ECR-197). Circular 29/41 provided that all foreign exchange transactions between Germany and the Netherlands were freed of control, the only important exception being that German investments of more than 100,000 gulden in Holland required permission of the Reichskommissar in the Netherlands. The clearing agreement was abolished, and payments between Germany and the Netherlands were permitted by simple bank checks, drafts, or postal money orders. A simultaneous order by the Reich Commissar for the Occupied Netherlands Areas lifted all restrictions set by Netherlands foreign exchange law on such transactions (ECR- 197).

After this "introduction of free payments traffic" or "removal of the foreign exchange frontiers," payments for exports from Holland were made in Germany "through the accounts of the banks, mainly through the account of the Netherlands Bank,

[Page 1074]

which takes on the exchange into gulden means of payment without further formalities." (ECR-174)

This exchange presumably merely continued the practice introduced earlier at the "instigation" of Seyss-Inquart. At all events, the President of the Bank, van Tonningen, was a Nazi agent, and his acts may be charged to the Nazi conspirators.

The result of this radical step was this:

"Ever since the introduction of free payments traffic the status of the Netherlands Bank is mainly influenced by the taking up of Reichsmarks. On 31 March 1941, the day before the introduction of free payments traffic, the Netherlands Bank had a total stock of about 83 million RM of Reichsmark credits, on 30 April 1941 of about 213 million RM, and on 31 May 1941 of about 366 million RM. Thus, in the two months after the removal of the foreign exchange frontier, it has taken up about 283 million RM, the gulden equivalent, at the rate of RM 132.7 equals florin 100, on the basis of the transfer agreement with the Reichsbank." (ECR-174)

Thus the Netherlands Bank was caused to pledge its credit (in the form of Dutch currency) in exchange for a Reichsmark credit. In this manner the Nazi conspirators were enabled to exact from the bank a loan unlimited in quantity and beyond the bank's control, by the simple expedient of writing out a check in Germany.

The original plaintext version of this file is available via ftp.

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