Morning Session
M. GERTHOFFER: Mr. President, Your Honors, at the end of the last session I had the honor of beginning the account of the French Prosecution on the economic pillage. In the first chapter I had indicated to you succinctly how the Germans had become masters of the means of payment in the occupied countries by imposing war tributes under the pretext of maintaining their army of occupation and by imposing so-called clearing agreements, functioning to their benefit almost exclusively.
In a second chapter, entitled “Sequestering of Production in the Occupied Territories,” I had the honor of expounding to you that, after the invasion, the factories were under military guard and that German technicians proceeded to transfer the best machines to the Reich; that the working population, having come to the end of their resources, grouped themselves around the factories to ask for subsidies; and, finally, that the Germans had ordered the resumption of work and had reserved for themselves the right to designate provisional administrators to direct the enterprises.
At the same time, the Germans exercised pressure over the rulers of the occupied countries and over the industrialists to bring the factories back to productivity. In certain cases they themselves placed provisional German administrators in charge and insinuated that the factories would be utilized for the needs of the occupied populations.
On the whole, to avoid unemployment and to maintain their means of production, the industrialists, little by little, resumed their work, endeavoring to specialize in the manufacture of objects destined for the civilian populations. Resorting to various means of pressure, the Germans imposed the manufacture of defensive armaments and then progressively of offensive armaments. They requisitioned certain enterprises, shut down those which they did not consider essential, distributed the raw materials themselves, and placed controllers in the factories.
The German control and seizure continually expanded in conformity with secret directives given by the Defendant Göring himself, as can be seen in a document dated 2 August 1940, discovered by the Army of the United States, which bears the Document Number EC-137, and which I place before the Tribunal as Exhibit Number RF-105. This is the essential passage of the document:
“The extension of the German influence over foreign enterprises is an objective of German political economy. It is not yet possible to determine whether and to what extent the peace treaty will effect the surrender of shares. It is now, however, that every opportunity should be used for German economy, in time of war, to obtain access to material of interest to the economy in occupied territories and to prevent removals that might hinder the realization of the above-mentioned aim. . . .”
I stop this quotation here. After having had knowledge of such a document, there can be no further doubt about the intentions of the German rulers. The proof of the putting into execution of such a plan is shown in a document which will be read when the particular case of France will be dealt with in the course of this exposé.
The Tribunal will be informed about a study of a certain Michel, Chief of the Administrative General Staff on Economic Questions, deputy to the German commanding officer in France, which brings out the extent of the dictatorship of the Reich over the occupied countries in economic matters. The control of the enterprises in occupied countries was assured by civil or military officials who were on the spot and also, later on, by similar German enterprises, which had become their “Paten-Firma.”
To give an example of this economic domination, here are the orders received by an important French company. This involves the Thomson-Houston Company, and I present a letter to the Tribunal under Document Number RF-106 in the French documentation, which is addressed to this establishment. It is dated Paris, 8 October 1943.
“Société des Procédés Thomson-Houston, 173 Boulevard Haussmann, Paris.
“You are fully responsible for the punctual, careful, and reasonable filling of the German orders which are passed to you, both as regards the giver of the order and my office, which is the competent agency for all orders given to France.
“To facilitate for you the execution of your obligations, the firm of the Allgemeine Elektricitäts Gesellschaft, Berlin (NW 40), Friederich-Karl-Ufer 2-4, is designated by me as the ‘Paten-Firma.’ I attach the greatest importance to close collaboration on technical matters with the above-mentioned firm. The Paten-Firma will have the following functions:
“1) To co-operate in the establishment of your production plan to utilize your capacities;
“2) To be at your disposal for all technical advice which you may need, and to exchange information with you;
“3) To serve as an intermediary, if need be, for negotiations with German authorities;
“4) To keep me informed as to anything that might occur which might prevent or limit the fulfillment of your obligations.
“In view of assuring these tasks, the Paten-Firma is authorized to delegate a Firmenbeauftragter to your firm, and when necessary, technical engineers from other German firms who may have handed you important orders.
“In order to permit the Paten-Firma to accomplish its task it will be necessary to give the firm or its Firmenbeauftragter the necessary information on everything that relates to the German orders and to their execution:
“1) By placing at its disposal your correspondence with your supply houses and with your subcontractors;
“2) By informing it now of the extent to which the capacities of your factories are being utilized and permitting it to check on the production;
“3) By letting it take part in your conferences and see your correspondence with the German authorities.
“It is your duty to inform the Paten-Firma or their Firmenbeauftragter immediately about any orders which you may receive.”
This is the end of the quotation.
Almost all the important enterprises in the occupied territories were thus placed under the control of German firms, with the double aim of favoring the Reich’s war effort and of achieving by progressive absorption an economic preponderance in Europe, even in case of a peace by compromise.
In the agricultural sphere the Germans used similar means of pressure. They made wholesale requisitions of products, leaving the population with quantities clearly insufficient to assure their subsistence.
I now take up the third chapter devoted to individual purchases by the German military or civilian forces in the occupied countries.
If the present statement cannot take up individual acts of pillage or the numerous thefts committed in the occupied countries, it is important nevertheless to mention the individual purchases, these having been organized methodically by the German rulers to benefit their own nationals.
At the beginning of the occupation the soldiers or civilians effected purchases by means of vouchers of doubtful authenticity which had been handed them by their superiors. Soon, however, the Germans had at their disposal a sufficient quantity of money to allow them to purchase without any kind of rationing, or by means of special vouchers, considerable quantities of agricultural produce or of objects of all kinds, notably textiles, shoes, furs, leather goods, et cetera. Thus, for instance, certain shoe stores were obliged to sell every week, in exchange for special German vouchers, 300 pairs of men’s, women’s, or children’s shoes for town wear.
This is indicated in an important report of the French economic control, to which I will have occasion to refer several times in the course of this presentation and which I submit to the Tribunal under Document Number RF-107.
The individual purchases which constitute a form of economic pillage were, I repeat, not only authorized but organized by the German rulers. In fact, when the Germans returned to their country they were encumbered by voluminous baggage. A postal parcel service had been created by the Germans for the benefit of their nationals living in the occupied countries. The objects were wrapped in a special kind of paper and provided with seals that enabled their entry, duty free, into Germany.
In order to get an idea of the volume of individual purchases, it is important to refer to the declarations of one Murdel, ex-director of the Reichskreditkasse at present detained in Paris, who was heard before an examining magistrate of the Cour de Justice de la Seine on 29 October 1945. This is the declaration made by Murdel on the subject of individual purchases, and I submit it in evidence as Document Number RF-108.
The judge asked Murdel the following question:
“What were the needs of the army of occupation? What purchases did you have to make on its account?”
Murdel answered:
“It is impossible for me to answer the first part of the question. I had tried during the occupation to obtain information on this point, but it was objected that this was a military secret which I had no right to know. What I can tell you is that we settled the pay of the troops and that a private earned from 50 to 60 marks, a noncommissioned officer 50 percent more, and an officer considerably more, naturally. I have no idea what forces the occupation army may have included, as these forces were extremely variable.”
I skip a few lines to make this shorter. Murdel adds:
“Apart from this, every soldier on leave returning from Germany had the right to bring back with him a certain number of marks (50). The same was the case for any German soldier who was stationed for the first time in France. We exchanged the marks into French francs. I value the total of the sum that we paid out each month in this way at 5,000 million francs.”
One may thus estimate at about 250,000 million francs, at least, the individual expense incurred in France by the Germans, of which amount the greater part was used for the purchase of products and objects sent to Germany, to the detriment of the French population.
To show the size of these costs, I would add that the amount of 5,000 million francs a month, in other words 60,000 million francs a year, is greater than the budget receipts of the French State in 1938, for these were only 54,000 million francs.
After having viewed the individual purchases, I shall enter upon a fourth chapter devoted to the organization of the black market by the Germans in the occupied territories. The population of the occupied countries had been subjected to a severe rationing of products of all kinds. They had been left only obviously insufficient quantities for their own vital needs.
These regulations made available a large quantity of the stock production which the Germans seized by means of operations that were, to all appearances, regular: requisitions, purchases by official services, individual purchases, or those in exchange for vouchers of German priority. We have just seen that these purchases represented for France, alone, an average of 5,000 million francs per month.
But such regulations produced, as a corollary, a depletion of merchandise and the concealment of products with the aim of keeping them from the Germans. This state of affairs gave birth, in the occupied countries, to what was called the black market, that is to say, clandestine purchases made in violation of regulations on rationing.
The Germans themselves were not slow in proceeding, to an ever greater extent, to purchase on the black market, mostly through agents and sub-agents, recruited among the most doubtful elements of the population, whose work was to find out where these products could be found.
These agents, compromised by violations of the legislation on rationing which they had committed, enjoyed absolute immunity; but they were constantly under the threat of denunciation on the part of their German employers in case they should slow up or stop their activity. Often these agents also fulfilled functions for the Gestapo and were paid by commissions, which they obtained in black market transactions.
The different German organizations in the occupied countries fell into the habit of making clandestine purchases that became increasingly important in volume. Indeed, they began to compete among themselves for this merchandise, the chief result of which was to increase the prices, thus threatening to bring about inflation. The Germans, while they continued to profit by the clandestine purchases, were anxious that the money which they used should maintain as high a value as possible.
To obviate such a situation, the rulers of the Reich decided in June 1942 to organize purchases on the black market methodically. Thus the Defendant Göring, the Delegate of the Four Year Plan, gave to Colonel Veltjens, on 13 June 1942, the mission of centralizing the structure of the black market in the occupied countries. This fact emerges from several documents discovered by the Army of the United States, of which I submit the first to you as Document Number RF-109. It is the nomination of Colonel Veltjens, signed by the Defendant Göring himself. I do not want to take up the time of the Tribunal in giving a complete reading of these documents. I think that they cannot be contested, but if this should occur later, I will reserve for myself the privilege of reading them later, unless the Tribunal would prefer me to read them immediately.
THE PRESIDENT: I am afraid we must adhere to our ruling. The documents which we cannot take judicial notice of must be read if they are to be put in evidence. You need only read the portions of the document which you require to put in evidence—not necessarily the formal parts, but the substantial parts which you require for the purpose of your proof.
M. GERTHOFFER: This is the letter of 13 June 1942, signed by the Defendant Göring.
“Owing to the simultaneous purchases of goods by the different branches of the Wehrmacht and other organizations on the so-called black market, a situation has developed in some occupied territories which hampers the methodical exploitation of these countries for the needs of German war economy, is also harmful to German prestige, and endangers the discipline necessary in the military and civilian administration. This deplorable state of things can no longer be tolerated. I therefore charge you to regularize these commercial transactions in agreement with the services that are involved and, particularly, with the chiefs of the administration of the occupied territories. In principle, commercial transactions in the occupied territories that are made outside the framework of the normal provisioning, or constituting a violation of price regulations, must be limited to special cases and can be carried out only with your previously given assent. I approve your proposal that only to trading companies controlled by the Reich should be assigned the handling of these goods, in the first place the ‘Roges.’
“I beg you to submit, at the earliest possible date, a detailed plan of operation for starting your activity in Holland, Belgium, France, and Serbia. (In Serbia it is Consul General Neuhausen who is to be in charge.) This plan must include the seizure of port installations and machinery and tools of enterprises to be closed down in the occupied territories. As to the results of your work, I beg you to submit a report to me every month through my representative; the first to be sent on 1 July 1942.
“If necessary, the Central Planning Board will decide as to the distribution of merchandise thus purchased.”—Signed—“Göring.”
Thereupon, on 4 September 1942, the Defendant Göring had given orders for the complete collection of all merchandise of use, even if signs of inflation should result from this act, in the occupied territories. This is shown by a report signed “Wiehl,” concerning the utilization of funds derived from occupation costs. I submit this to the Tribunal as Exhibit Number RF-110 (Document Number 1766-PS).
Shortly after, on 4 October 1942, the Defendant Göring made a speech on the occasion of the Harvest Festival, a speech that is reported in Das Archiv of October 1942, Number 103, Page 645. In this speech the Defendant Göring stated implicitly that he meant purchases on the black market in the occupied countries to continue for the benefit of the German population. I submit a copy of this article as Document Number RF-111 and I quote from it the following passage:
“I have examined with very special care the situation in the occupied countries. I have seen how the people lived in Holland, in Belgium, in France, in Norway, in Poland, and wherever else we set foot. I have noticed that although very often their propaganda speaks officially of the difficulty of their food situation, in point of fact this is far from being the case. Of course everywhere, even in France, the system of ration cards has been introduced; but what is obtained on these ration cards is but a supplement, and people live normally on illegal commerce.
“The recognition of this has caused me to make a firm decision, creating a principle which must be rigidly adhered to. The German people must be considered before all others in the battle against hunger and in the problem of food supply. It is my desire that the population of the territories which have been conquered by us and taken under our protection shall not suffer from hunger. If, however, through enemy measures difficulties of food supply should arise, then all must know that if there is to be hunger anywhere it shall in no case be in Germany. . . .”
The United States Army has discovered a secret report, made on 15 January 1943, by Colonel Veltjens, in which he gives an account of his activity over a period of 6 months to the Defendant Göring. This is Document Number 1765-PS, which I submit now to the Tribunal as Exhibit Number RF-112. It is not possible for me to give a complete reading of this report. I shall simply read certain passages of it.
In the first part of his report Veltjens explains the reasons for the rise of the black market in these terms:
“1) The reduction in merchandise as a result of the regulations and rationing. . . .
“2) The impossibility of stabilizing prices. . . .
“3) The impossibility of price control on German lines owing to lack of personnel in the German control organizations.
“4) The neglect of practical support for counter-measures on the part of the local administrative authorities, especially in France.
“5) The half-hearted penal justice of the local judiciary authorities.
“6) The lack of discipline of the civilian population. . . .”
Then under the same number 6), a little further, Veltjens indicates:
“The activity of the German services on the black market grew little by little to such an extent that more and more unbearable situations arose. It was known that the black market operators offered their merchandise to several bureaus at the same time and that it was the one which gave the highest price who obtained the merchandise. Thus, the different German formations not only vied with each other in obtaining the merchandise, but also they caused the prices to rise.”
Further on in his report, Veltjens indicates that he has assumed the direction of the service created by the Delegate for the Four Year Plan in these terms:
“Finally, in June 1942, in agreement with all the central services, the delegates for the special missions (B. f. S.) were charged with taking in hand the seizure and the central control of the black market. Thus, for the first time, a necessary preliminary condition was created for effectively dealing with the problem of the black market.”
In the second part of his report, Veltjens explains the advantages of the organization in charge of which he was placed and he writes, among other things:
“It has been stated that purchases on the black market in their present volume would become in the long run too much for the budget of the Reich. In answer to this it must be pointed out that the greater part of the purchases were made in France and were financed by occupation costs. Out of a total of purchases amounting to 1,107,792,819 RM, the sum of 929,100,000 RM was charged to the French for occupation costs so that the Reich budget was not involved for that amount.”
After having indicated the inconveniences of the black market, Veltjens concludes:
“In recapitulating”—writes Veltjens—“it must be stated that, in view of the supply situation in the Reich, now as before we cannot do without black market purchases as long as there are still hidden stocks which are important for carrying on the war. To this vital interest all other considerations must be subordinated.”
In a third part of this same report, Veltjens deals with the technical organization of his offices. Here are some interesting passages:
“The general direction and supervision of the purchases is the task assigned to the control services which have been newly created for this purpose, as follows:
“a) Supervisory service in France, with headquarters in Paris;
“b) supervisory service in Belgium and the North of France, with headquarters in Brussels;
“c) supervisory service in Belgium and in the North of France, auxiliary service Lille, with headquarters in Lille;
“d) supervisory service in Holland with headquarters in The Hague;
“e) supervisory service in Serbia with headquarters in Belgrade.”
Then Veltjens tells us that purchases themselves were carried out by a restricted number of licensed purchasing organizations, that is, 11 for France, 6 for Belgium, 6 for Holland, 3 for Serbia.
“So”—he writes—“all the purchases are subject to the central control of the delegate for the special missions.”
Further on Veltjens adds:
“The financing of the purchases and the transport of merchandise are to be carried out by the Reich-owned Roges m. b. H. The merchandise is then to be distributed to the purchasers in the Reich by Roges in accordance with instructions from the Central Planning Board, or departments appointed by the Central Planning Board and in order of urgency.”
In the fourth section of his report Veltjens gives the volume of the operations carried out up to the date of 30 November 1942, that is to say, in less than 5 months, as his organization had not begun its activity before 1 July 1942. Here are the figures that Veltjens gives:
“The volume of purchases made (up to 30 November 1942):
“(a) Since the inauguration of the purchases directed by the German commanders or the Reich Commissioner, and of the directed distribution of merchandise in the Reich, there has been purchased a total of 1,107,792,818.64 Reichsmark: In France a total amount of 929,100,000 Reichsmark; in Belgium 103,881,929 Reichsmark; in Holland 73,685,162.64 Reichsmark; and in Serbia 1,125,727 Reichsmark.”
Veltjens adds:
“The payment in France is made from the account of the occupation costs, and in the other countries by means of clearing.”
Then Veltjens gives a table of merchandise purchased in this way over the period of these 5 months. I shall simply give a summary to the Tribunal:
“1) Metals, 66,202 tons valued at 273,078,287 Reichsmark; 2) textiles, a total value of 439,040,000 Reichsmark; 3) leather, skins, and hides to a total value of 120,754,000 Reichsmark.
Veltjens adds:
“Further purchases comprised: Industrial oils and fats, edible oils and fats, wool, household articles, mess articles, wines and spirits, engineering equipment, medical articles, sacks, et cetera.”
Veltjens then gives a table of the increase in prices during these 5 months. Then he states the principle that the black market must be utilized solely to the benefit of Germany and be severely repressed when it is utilized by the populations of the occupied countries. On this subject he actually writes:
“1. Extension of price control. As an increase of the personnel of the German controlling offices may not be possible, or may be possible only to a limited extent, it will be necessary to obtain from the local administration authorities greater activity in this respect.
“2. Application of severe penalties, on German lines, for violations of regulations. This is the only means of remedying the lack of discipline among the civilian populations, arising from their individual and liberal ideas. A check of the sentences that have been passed by the local tribunals is to be recommended.
“3. The promise of rewards for denouncing violations of the rationing regulations, equivalent to a high percentage of the value of the goods seized on account of the denunciation.
“4. The hiring of informers and of agents provocateurs.
“Further to hinder illegal production:
“5. Closing of all enterprises that are not working for the war industry.
“6. Closing or merging of enterprises whose capacity or production is being only partly exploited.
“7. Closer control of the productivity of factories.
“8. Close examination of the quantity of raw materials allotted for the German orders placed in France.
“9. A policy of prices which affords the enterprises adequate profit and thus guarantees their means of existence.”
Examining the demands of the rulers of the occupied countries with relation to the German purchases on the black market, Veltjens writes:
“Moreover, lately the French and Belgian economic and government circles, among others the Chief of the French Government himself, have considered it necessary to complain about the organized German buying. In response to remonstrations of this kind, it should be pointed out—in addition to various other arguments—that on the part of the Germans, too, there is naturally the greatest interest in the disappearance of the black market. But the chief responsibility for its existence rests with the government authorities themselves for their incompetence regarding price control and their negligence in meting out just punishment, whereby lack of discipline among their own population is encouraged.”
The Tribunal will allow me to stress the value of the argument developed by Veltjens by reminding it that the Germans were the principal purchasers on the black market, and that their agents enjoyed absolute immunity.
Finally, speaking of the machinery in the factories, Veltjens writes in his report:
“Another order of the delegate for the special missions concerns seizure of the machinery of closed factories. It is an established fact that great capacities, particularly of machine tools, are not being utilized at present, while at home they are urgently needed for armament production. After an agreement by the delegate of special missions, the military commander, and the plenipotentiary for machine production, there has been created in France, at the armament inspection office, an office for the distribution of machines (Maschinenausgleichstelle).
“The creation of Maschinenausgleichstellen in Belgium and Holland is pending. One of the main difficulties, in this field, is to overcome the resistance of the owners of the factories, as well as that of the local government offices of the occupied territories.
“The occupation authorities will have to use every means to break this resistance.”
In conclusion, Veltjens alludes in his report to the Roges company, which was a special organization for the transport to Germany of the booty captured in the occupied countries, and more particularly, of products acquired by operations on the black market. One of the directors of this organization, called Ranis, was interrogated on 1 November 1945, and declared in substance that the Roges company had begun its activity in February 1941, succeeding another organization. On the whole he confirms the facts that are reported in Veltjens’ report. I shall therefore simply submit a copy of his interrogation to the Tribunal under Document Number RF-113.
The scope of the operations on the black market is thus established by German documents which cannot be contested by the opposite side. I beg to point out to you that these documents prove that within 5 months, in three countries, these operations amount to the sum of 1,107,792,818 Reichsmark. We shall come back to certain details when examining the special situation of certain countries. However, it is necessary for me to indicate the reasons why the Defendant Göring finally came to decide that the black market operations should be suspended.
Indeed, on 15 March 1943, under the pretext of avoiding the risk of inflation in the occupied countries, Göring decided that black market purchases be suspended. We have just seen that the Defendant Göring worried little about the fate of the population of the occupied countries, since he had decided that the black market purchases were to continue even at the risk of inflation.
The true reason is the following: While the official German organizations were buying at prices which were strictly fixed by them, the clandestine organizations were accepting much higher prices. The merchandise was therefore always gravitating to the black market, to the detriment of the official market; and clandestine production in the end absorbed the normal production.
Finally it must be added that the corruption resulting from such practices in certain circles of the German Armed Forces became disquieting to the German leaders. The black market was therefore suppressed officially on 15 March 1943, but some purchasing bureaus continued their clandestine activities until the time of liberation but on a much smaller scale than before 15 March 1943.
I cite a passage of the report of the French Economic Control which I have just put into evidence as Document Number RF-107 and which gives an idea of the disorder that was created by the German actions and which shows the reasons why the Reich authorities officially suspended the black market purchases—Page 21 of the French text:
“That was the time when champagne, cognac, and benedictine were handled by lots of 10,000 to 50,000 bottles and pâte de foie gras by the ton! From the very beginning the general corruption had affected a great number of the Wehrmacht officers, attracted by the sumptuous life which surrounded them. It penetrated so far into the German military circles that, from the lower mess sergeant up to the superior officer, each one was implicated with the worst traffickers, demanding commissions on all the deals. In a clandestine sale of wool thread the authorities found themselves face to face with a general of the Air Force.”
Around them soon flocked all the bad elements of France, swindlers and other habitual criminals. Then came a crowd of all the customary trade traffickers, brokers, and out-of-work agents, generally unimportant middlemen.
It is understood that in such a circle, composed of unknown and elusive people, the black market deals which were transacted without invoices and in cash, and without written receipts, except those of the German offices, cannot today be easily disclosed and evaluated.
I resume the quotation at Page 22:
“Originating in the course of the year 1941, the commercial agitation of these Parisian purchasing bureaus continued in this manner for about 20 months. But, after having attained its peak at the end of 1942, this activity came to an abrupt end in March 1943, a victim of its own excesses.
“Actually, during the entire occupation production prices were strictly limited by the French authorities and even more so by the German economic services which were systematically opposed to any increase in prices and anxious, above all, to maintain large purchasing power for the French money at their disposal.
“But, since the supplies delivered to the enemy under contract were being paid for at prices hardly better than the legal ones, the clandestine purchasing agencies accepted at the same time rates several times higher for the same products.
“So the conveying of merchandise to the German black market increased more and more, while the secret production of goods to be forwarded through these dark channels increased. The disorder became rapidly such that, in certain branches of industry, deliveries according to contract could not be carried out except with great delay, in spite of the menacing protests of the German authorities.
“Completely aghast, the French Ministry of Industrial Production had to inform the German authorities that the national production would soon no longer be able to meet its obligations.
“This obvious situation, together with the necessity of putting an end to the incredible corruption brought about by the black market in the Wehrmacht, led the Reich Government, if not totally to suppress the black market, at least to consider closing the Paris purchasing bureaus.
“This measure was made effective 13 March 1943 according to an agreement between Bichelonne and General Michel.
“However”—and this is very significant—“the German economic services did not fail to ask in compensation for a considerable rise in the quotas fixed under the agreements. Thus for the Kehrl plan alone this rise amounted to 6,000 tons of textiles.
“Only a few bureaus were able to carry on their activities until the liberation, either by endeavoring to execute their purchases through Roges (D’Humières, Economic Union, et cetera), or collaborating with military authorities buying supplies and with the bureaus of the German Air force and the Navy.”
THE PRESIDENT: We will adjourn for 10 minutes.
[A recess was taken.]
M. GERTHOFFER: In the course of my explanations I shall come back to the case of each particular country, concerning the black market operations, in order to show their extent. But I think that, just now, it is established by the Veltjens report, as well as by the passages from the French Economic Control report which I had the honor to read to the Tribunal, that the black market was organized by the leaders of the Reich, and especially by the Defendant Göring.
And to finish the general observations concerning economic plundering, I beg the Tribunal’s permission to give a few explanations from the legal point of view. That is the subject of Chapter 5 of this first part.
From a legal point of view it is not contestable that organized plundering of the countries invaded by Germany is prohibited by the International Hague Convention, signed by Germany and deliberately violated by her, even though her leaders never failed to invoke this Convention every time they tried to benefit by it.
Section III of the Hague Convention, entitled “The Military Authority over the Territories of the Enemy State,” relates to economic questions. These clauses are very clear and need not be discussed. If the Tribunal will allow me to recall them in reading, here is Section III of the Hague Convention which I put into the document book as Document Number RF-114, and which is entitled, “The Military Authority over the Territories of the Enemy State”:
“Article 42: A territory is considered occupied when it is placed actually under the authority of the hostile army. The occupation extends only to the territories where this authority has been established and can be exercised.
“Article 43: The authority of the legitimate power having in fact passed into the hands of the occupant, the latter. . .”
THE PRESIDENT: I think we can take judicial notice of these articles of the Convention.
M. GERTHOFFER: I shall therefore not read this article, since the Tribunal knows the Convention, and shall simply limit myself to certain juridical remarks.
These texts of the Hague Convention show in a very clear way that the Germans could seize in occupied countries only what was necessary for the maintenance of troops indispensable in the occupation of the territories. All items which were levied beyond these limits were in violation of the texts which you know, and consequently these acts were acts of plundering.
Counsel for the Defense may contend that all these prescriptions must be put aside, because Germany had set herself the goal of continuing the war against Britain, the U.S.S.R., and the United States of America. The Defense may claim that, because of this, Germany was in a state of need and had to counter the prescriptions of the Hague Convention, trying to interpret the Article 23 G as allowing destruction or seizure even of private property.
I shall immediately answer that this text does not lay down rules relating to the conduct of the occupant in enemy territory. These last prescriptions are contained, I repeat, in Articles 42 to 56, but they referred to the conduct, which the belligerents must observe in the course of the combat.
The words “to seize” in the sentence, “. . . to seize enemy property except in cases where . . . these seizures are absolutely demanded by military necessity,” mean—and there can be no discussion as to translation because actually the French text is binding—the words “to seize” mean not to appropriate a thing, but to put it under the protection of the law with a view to leaving it unused, in the state in which it was found, and keeping it for its true owner or for whoever can show right to it. Such a seizure permits the military authority, as long as the action lasts, to prevent the owner from using the property against its troops, but it does not authorize the military authority in any case to appropriate it for itself.
Acts of economic plunder are all contrary to the principles of international law and furthermore are formally provided for by Article 6b of the Charter of the International Military Tribunal of August 1945.
These constant violations of the Hague Convention had the result of enriching Germany and permitted her to continue the war against Britain, the Soviet Union, and the United States, while they ruined the invaded countries, the populations of which, subjected to a regime of slow famine, are now physically weakened and, but for the victory of the Allies, would be on the road to progressive extermination.
These inhuman deeds therefore constitute War Crimes which come within the competency of the International Military Tribunal as far as the leaders of the Reich are concerned.
Before finishing this rapid summary of juridical questions, the Tribunal will permit me to refute in advance an argument which will certainly be presented by the Defense, especially as far as economic plunder is concerned. They will claim that your high jurisdiction did not exist, that international penal law had not yet been formulated in any text when the defendants perpetrated the acts with which they are at present charged, and that therefore they could not be condemned to any sentence whatsoever by virtue of the principle of non-retroactivity of penal laws.
Why, Gentlemen, is this principle adopted by modern legislation? It is indisputable that any person who is conscious of never having violated any legal prescription could not be condemned because of acts which were committed in such circumstances.
For example, somebody issues a check without funds to cover it, before his country had adopted a penalty for such an offense. But the case which is submitted to you is quite different. The defendants cannot maintain that they were not conscious of having violated legislation of any kind. First of all, they violated international conventions: The Hague Convention of 1907, the Kellogg-Briand Pact of 27 August 1938, and then they violated all the penal laws of the invaded countries.
How, in these proceedings, shall economic plunder be qualified? Theft, swindling, blackmail, and even, I will add, murder—since, in order to attain their aims, the Germans have premeditated and committed numerous murders which enabled them to intimidate the population in order to plunder them better.
From the point of view of domestic law, these deeds certainly fall under the application of Articles 295 and the following ones of the French penal code, and especially of Article 303, which stipulates as guilty of murder all offenders, of whatever category, who, to execute their crimes, resort to torture or perpetrate barbarous acts. I will add that the defendants violated even the German criminal code, in particular under Articles 249 and following.
Counsel for the Defense will certainly stress that some leaders of the invaded countries were in agreement with the Reich Government as to the economic collaboration, and that consequently the Reich Government cannot be charged with acts which derive from these agreements.
Such arguments must be refuted:
1.) If, in all the invaded countries, patriots resisted with more or less courage, it is true that some of them, out of inertia, fear, or self interest, turned traitors to their country. They have been or will be condemned. But the crimes committed by certain of them cannot be exonerating or even extenuating circumstances in favor of the defendants, especially since the latter had very often put these traitors in to manage the occupied countries. The fact of having brought individuals to turn traitor to their country only aggravates, on the contrary, the heavy charges against the defendants.
2.) These so-called agreements had all been obtained by pressure or by threat. The concluded contracts show that they were solely in favor of Germany, who, as a matter of fact, never brought any compensation or illusory benefits—very often their burdensome nature is seen from the mere reading of such contracts, as I will have the honor to show in certain particular cases.
With these explanations my general observations on the economic pillage are concluded, and if the Tribunal is willing we can examine the particular case of Denmark.
When the Germans invaded Denmark, contrary to all the prescriptions of the law of nations and to their engagements, they were not certain of rapidly dominating Western Europe. At first they laid down the principle that they would not take anything in the country, but after their success of May 1940 their attitude changed; and little by little they treated Denmark more or less like the other occupied countries.
Nevertheless, they sought to achieve annexation pure and simple, and took rigorous measures against the population only in the course of 1942, when they saw that they would not be able to win Denmark over. From the economic point of view, and to assure their domination, they tried to have at their disposal the majority of the Danish means of payment, and they used to this effect two methods which to a great extent were used by them in other countries: (1) The levying of a veritable tribute of war, under the pretext of maintaining their army of occupation; (2) the functioning of the so-called clearing agreement to their almost exclusive benefit. These two methods should be studied in Chapter I of this statement.
Chapter I, German seizure of the means of payment; costs of occupation.
Article 49 of the Hague Convention stipulates that if the occupant levies a tax the money will only be for the army of occupation or for the administration of the territory.
The occupant can therefore levy a tax for the maintenance of its army, but this tax must not exceed the sum strictly necessary. The needs of the army of occupation mean, not the costs of armament and equipment, but only the costs of billeting, food, and pay. I say normal expenses, which exclude luxuries.
Article 52 authorizes the occupying power to exact from the communes or inhabitants, for the needs of the army, requisitions in kind and services, with the express condition that they should be proportionate with the resources of the country and of such a nature that they should not imply for the population the obligation to take part in operations against their own country.
The same Article 52 stipulates that levies in kind shall be paid as far as possible in cash; otherwise they are to be confirmed by receipts and the sums due paid as soon as possible.
In other words, the Hague Convention allows the occupying army to requisition in occupied territories what is necessary for the maintenance of the troops but under two conditions, apart from contributions in kind: 1) That the requisitions and the services should be proportionate to the resources of the country, that is to say, that sufficient should be left over for the inhabitants, to enable them at least to live; 2) that the levies should be paid as soon as possible. This is not a question of fictitious payment made with funds extorted from occupied countries, but actual payment, which implies supplying real equivalents.
Article 53 of the Convention of The Hague which permits the occupying powers to seize everything which could be turned against them—and in particular, cash, funds, and securities of all kinds belonging to the state of the occupied country—does not authorize the occupying power to appropriate them.
According to information furnished by the Danish Government, when the Germans entered Denmark they declared that they would not demand anything from the country, but that supplies for the German Army would come from the Reich.
Nevertheless, instead of buying Danish crowns to permit their troops to spend money in Denmark, as early as 9 May 1940 they imposed the circulation of notes of the Reichskreditkasse, which is shown in Number 26 of the VOBIF, which I have already submitted under Document Number RF-93.
Upon the protestations of the National Danish Bank against the issuing of foreign paper money, the Germans withdrew these notes from circulation, but demanded the opening of an account at the National Bank, promising to draw upon it only for sums which were essential for the maintenance of their army in Denmark.
But the Germans did not lose time in violating their promises and in levying on their account, in spite of the Danish protests, sums infinitely superior to the needs of the army of occupation.
According to the information given by the Danish Government, the Germans levied, per month, an average of 43 million crowns in 1940; 37 million crowns in 1941; 39 million crowns in 1942; 83 million crowns in 1943; 157 million crowns in 1944; 187 million crowns in 1945. The total of these levies amounts, according to the Danish Government, to 4,830 million crowns.
I submit, as Document Number RF-115, the financial report of the Danish Government concerning this, a report to which I shall refer again in the course of this statement.
The indications of the Danish Government are corroborated by a German document discovered by the United States Army, Document EC-86, Page 11, which I submit to the Tribunal as Exhibit Number RF-116.
This is a secret report of 10 October 1944, written by the Arbeitsstab Ausland, and concerns the requisition of funds of the occupied territories.
On Page 11 the following is said:
“Denmark is not considered as occupied territory, and therefore does not pay occupation expenses. The means necessary for the German troops are placed at the disposal of the central administration of the Reichskreditkasse by the Central Danish Bank, through channels of ordinary credit. In any case, for the duration of the war uniform payment by Denmark is assured.”
The writer of this report says that the levies to 31 March 1944, for occupation expenses, amount to: 1940-1941, 531 million crowns; 1941-1942, 437 million crowns; 1942-1943, 612 million crowns; 1943-1944, 1,391 million crowns; which represents, up to 31 March 1944, levies amounting to 2,971 million crowns. This corresponds to the information given by the Danish Government for approximately the same period—2,723 million crowns.
The same German report shows that the rate of exchange for the mark, as compared to the rate of exchange for the crown, had been fixed by the occupying powers at 47.7, then at 53.1 marks per 100 crowns.
Even though the Germans claim, against all evidence, that Denmark was not an occupied territory, they levied in this country the total sum of 4,830 million crowns, an enormous sum in view of the number of inhabitants and the resources of the country. In reality, this was nothing other than a war tribute which Germany imposed under the pretext of furnishing means of payment to her army stationed in Denmark.
The maintenance of the army necessary for occupying Denmark did not necessitate such large expenses. It is evident that the Germans used, as in other countries, the majority of the funds extorted from Denmark to finance their war effort.
Chapter II, clearing.
In 1931 Germany faced financial difficulties, which she used as a pretext to declare a general moratorium on all her foreign obligations. Nevertheless, to be able to continue, to a certain extent, her commercial operations with foreign countries, she concluded with most of the other nations agreements permitting the payment of her commercial debts, and even of certain financial debts, on the basis of a system of compensation called “clearing”.
Ever since the beginning of the occupation, 9 April 1940, and for its duration, the Danish authorities did everything they could, but in vain, to counteract German activity in this direction.
Under the pressure of occupying forces Denmark could not prevent her credit in the clearing balance from constantly increasing, owing to the German purchases which were made without the guarantee of any equivalent. According to the Danish Government, the credit balance of the account progressed in the following way: 31 December 1940, 388,800,000 crowns; 31 December 1941, 784,400,000 crowns; 31 December 1942, 1,062,200,000 crowns; 31 December 1943, 1,915,800,000 crowns; 31 December 1944, 2,694,600,000 crowns; 30 April 1945, 2,900 million crowns.
These data are corroborated by those of the German report which I submitted a few minutes ago under Exhibit Number RF-116 (Document Number EC-86), and according to which, on 31 March 1944, the Germans had procured for themselves means of payment, through clearing, amounting to a total sum of 2,243 million crowns.
It has not been possible to establish the use the occupants made of the sum of 7,730 million crowns which they obtained fraudulently, to the detriment of Denmark, with the help of the indemnity of occupation and of clearing.
The information which we have up to now does not enable us to estimate the extent of the operations carried out by the Germans on the black market. Nevertheless, the writer of the report of 10 October 1944, presented previously, indicates; and I quote:
“An estimate of the amounts spent on the black market must not be made. Of course, one may assume that members of the Wehrmacht are buying at top prices butter and other products in Denmark. But it is impossible to fix these sums even approximately, for the black market seems to be less widespread and less well co-ordinated than in the other occupied territories of the West, and is closer to the structure of the German black market with its fluctuating prices. Nevertheless, the prices of the Danish black market can generally be considered as much lower than the German prices. It is, therefore, not possible to speak of an average high price, as for instance in France, Belgium, and Holland.”
It is worth noting that the Germans, and especially members of the Wehrmacht, used to operate on the black market and that payment was effected with funds extorted from Denmark.
Concerning the apparently regular requisitions, we also lack the necessary information to be able to give precise details. Nevertheless, according to a secret report of 15 October 1944, addressed by the German officer of the Economic Staff for Denmark to his superiors in Frankfurt an der Oder, a document discovered by the United States Army and which I submit as Document Number RF-117, the following goods were requistioned by his department:
“From January to July 1943, 30,000 tons of turf; in May 1944, 6,000 meters of wood. . . .”
The writer adds that they tried to push this production to 10,000 cubic meters per month.
“. . . in September 1944, 5,785 cubic meters of cut timber, 1,110 meters of uncut timber, 1,050 square meters of plywood, 119 tons of paint for ships, and special wood for the navy.”
Gentlemen, this is but an enumeration of the requisitions which just one German section happened to make within a short time.
Denmark had to furnish large quantities of cement. Germany furnished her, in exchange, with the coal necessary for this manufacture.
According to this report which I have mentioned, in August 1944 the Germans bought in Denmark foodstuffs for over 8,312,278 crowns. These figures are less than the truth. According to the last information we have received from the Danish Government, the requisitions of agricultural items alone amounted, on an average, to 70 million crowns per month; which represents, for 60 months of occupation, requisitions to a value of 4,200 million crowns.
Chapter III, requisitions not followed by payment.
Apart from that which they managed to buy with the help of crowns which were deposited in their accounts under the pretext of the maintenance of the army of occupation and of clearing, the Germans appropriated an important quantity of things without having paid for them in any seemingly regular manner.
It was in this way that they appropriated supplies from the Danish Army and Navy—lorries, horses, means of transport, furniture, clothing, the amount of which to date has not been evaluated but might be estimated at about 850 million crowns. Many requisitions and secret or even apparent purchases have not yet been estimated exactly.
The same report, submitted under Document Number RF-115, contains, on the part of the Danish Government, an approximate and provisional estimate of the damages sustained by Denmark and of the German plunder, which amounts to 11,600 million crowns.
The information which we have to date does not permit me to give any more particulars concerning Denmark. I will, therefore, if the Tribunal will permit me, begin with the particular case of Norway.
The economic plundering of Norway.
The German troops had only arrived in Norway when Hitler declared, on 18 April 1940, that the economic exploitation of that country should be proceeded with, and for that reason Norway must be considered as an enemy state.
The information which we have on the economic plundering of Norway is rather brief; but it is, nevertheless, sufficient to estimate the German activity in this country during the entire period of the occupation.
Norway was subjected to a regime of most severe rationing. As soon as they entered the country, the Germans tried—and this was contrary to the most elementary principles of International Law—to draw from Norway the maximum resources possible.
In a document discovered by the United States Army, Document Number ECH-34, which I submit as Exhibit Number RF-118, a document which consists of the Journal de Marche of the economy and armament service in Norway, written in April 1940, we have excerpts of the directives relative to administration and economy in the occupied territories.
Here are some excerpts from this document:
“Directive of Armament Economy:
“Norwegian industry, to the extent to which it does not directly supply the population, is, in its essential branches, of particular importance for the German war industry. That is why its production must be put, as soon as possible, at the disposal of the German armament industry, if this has not already been done. This production consists mainly of intermediate products, which require a certain amount of time to be turned into useful products, and of raw materials which—such as aluminum, for example—can be used while we wait for our own factories, which are being built, to be in a position to produce.
“In this connection, above all, the following industrial branches must be taken into consideration:
“Mining plants for the production of copper, zinc, nickel, titanium, wolfram, molybdenum, silver, pyrites.
“Furnaces for the production of alumina, aluminum, copper, nickel, zinc.
“Chemical industries for the production of explosives, synthetic nitrogen, calcium nitrate, superphosphate, calcium carbide, and sodium products.
“Armament industries, naval dockyards, power stations, especially those which are supplying electric current to the above-named industries.
“The production capacities of these industries must be maintained at the highest possible level for the duration of the occupation.
“A certain measure of assistance by the Reich will, at times, be necessary to overcome industrial bottlenecks which are to be expected on account of the cutting off of English and overseas imports.
“Of particular importance is the guaranteeing of raw material industries which to a considerable part depend on overseas imports.
“For the moment it may be left undecided whether a future supply of bauxite from the German stocks is necessary for utilizing the capacities of the aluminum plants.”
As soon as the troops entered Norway, Germany issued notes of the Reichskreditkasse which were legal tender only in Norway and which could not be used in Germany. As in the other occupied countries, this was a means of pressure to obtain financial advantages, which were supposedly freely given by the brutally enslaved countries.
The Germans did their best to become masters of the means of payment and of Norwegian credit by the two methods which have become classic: Imposition of a veritable war tribute, on the pretext of the maintenance of the army of occupation, and also the working of a system of clearing to their profit.
German seizure of the means of payment.
First, indemnities for the maintenance of the army of occupation.
At the beginning of the occupation, the Germans used for their purchases notes of the Reichskreditkasse. The Norwegian holders of this paper money used to change it at the Bank of Norway, but this financial institution could not obtain from the Reichskreditkasse any real equivalent. In July 1940 the Bank of Norway had to absorb 135 million Reichsmark from the Reichskreditkasse. To avoid losing control over monetary circulation, the Bank of Norway was obliged to put the Norwegian notes at the disposal of the Germans, who drew checks on the Reichskreditkasse which the Bank of Norway was obliged to discount.
The debit account of the Bank of Norway, following the German levies, amounted to:
1,450 million crowns at the end of 1940; 3,000 million crowns at the end of 1941; 6,300 million crowns at the end of 1942; 8,700 million crowns at the end of 1943; 11,676 million crowns at the liberation of the country.
All the Norwegian protests were in vain in the face of German extortions. The constant threat of the new issuing of notes of the Reichskreditkasse as instruments of obligatory payment beside the Norwegian currency obliged the local financial authorities to accept the system of levies on account, without actual cover, which was less dangerous than the issuing of paper money over the circulation of which the Norwegian administration had no power of control.
This may be seen in particular from a secret letter sent on 17 June 1941 by General Von Falkenhorst, Commander-in-Chief in Norway, to the Reich Commissioner, Reichsleiter Terbeven, a copy of which was found not long ago in Norway and which I submit to the Tribunal as Document Number RF-119. In this document, after having stated that one could not reduce the expenses of the Wehrmacht in Norway, Von Falkenhorst writes:
“I am, however, of the opinion that the problem cannot be solved at all in this manner. The only remedy is to abandon completely the actual monetary system by introducing Reich currency. But of course this does not come into my domain. I regret, therefore, that I am not able to propose any other remedies to you, although I am fully conscious of the seriousness of the situation in which you find yourself.”
To the indemnities for the alleged maintenance of the army of occupation must be added a sum of 3,600 million crowns paid by the Norwegian Treasury for the billeting of German troops. This information comes to us from a report from the Norwegian Government, which I submit as Document Number RF-120.
From the sum of approximately 12,000 million crowns levied for the alleged maintenance of the occupation troops, a large part was used for other purposes; for the police and propaganda, in particular, the occupation spent 900 million crowns. This comes from a second report of the Norwegian Government, which I submit as Document Number RF-121.
Secondly, clearing.
The clearing agreement of 1937 for the barter of goods between Norway and Germany remained in force during the occupation but it was the Bank of Norway which had to advance the necessary funds for the Norwegian exporters. The Germans also concluded clearing agreements in the name of Norway with other occupied countries, neutral countries, and with Italy.
At the liberation, the credit balance of Norwegian clearing amounted to 90 million crowns but this balance does not show the actual situation. In fact:
1) The imports destined to the German military needs in Norway were handled through clearing in a very improper manner;
2) For certain goods especially (pelts, furs, and fish) the Germans had demanded that exportation should be made to the Reich. Then they sold these products again in other countries, especially Italy as far as fish was concerned;
3) The Germans, who controlled the fixing of prices, systematically raised the price of all products imported into Norway which, moreover, were used for the greater part for the military needs of the occupation. On the other hand, they systematically lowered the prices of the products exported from Norway.
In spite of all their efforts and sacrifices, and owing to the fraudulent operations of the occupiers, the Norwegian authorities could not prevent a very dangerous inflation.
From the report of the Norwegian Government, which I submitted under Document Number RF-120 a few moments ago, it is seen that the paper currency which in April 1940 amounted to 712 million crowns, rose progressively to reach, on 7 May 1945, 3,039 million crowns. An inflation of this extent, resulting from the activities of the occupiers, enables us to measure the impoverishment of the country. The same report indicates that the Germans did not manage to seize the gold of the Norwegian Bank, as that had been hidden in good time.
Let us now, Gentlemen, examine the levies in kind.
The Germans proceeded, in Norway, to make numerous requisitions which were or were not followed by so-called regular payments. According to the report of the Norwegian Government, here is the list of requisitioned goods: Meat, 30,000 tons; dairy products and eggs, 61,000 tons; fish, 26,000 tons; fruit and vegetables, 68,000 tons; potatoes, 500,000 tons; beverages and vinegar, 112,000 tons; fats, 10,000 tons; wheat and flour, 3,000 tons; other foodstuffs, 5,000 tons; hay and straw, 300,000 tons; other fodder, 13,000 tons; soap, 8,000 tons.
But this list which I have just read to the Tribunal includes only the official purchases, which were made with Norwegian currency and paid for through clearing; it does not include the illicit purchases.
At present, it is not yet possible to make estimates. As an example, we can say, however, that the export of fish, most of which went to Germany, for 1 year only (1942) came to about 202,400 tons, whereas the official requisitions during the whole occupation amounted only to 26,000 tons.
As in other occupied territories, the Germans forced the continuation of work under threat of arrest.
Most of the Norwegian merchant fleet escaped from the Germans; nevertheless, they requisitioned all the ships they could, especially most of the fishing boats.
Even if the occupier could not seize all railway rolling stock, trams, as well as about 30,000 motor vehicles, were transported to Germany.
If we refer to the report of 10 October 1944 of the German Economic Service, which I submitted under Exhibit RF-116 (Document Number EC-86), we will see that the writer of the report himself estimates that the effort demanded from Norway was beyond her possibilities; and he writes:
“. . . Norwegian economy is especially heavily burdened by the demands of the occupation Forces. For this reason the cost of occupation had to be limited to cover only a part of the expenses of the Wehrmacht. . . .”
After having mentioned that the cost of occupation which had been collected up to January 1943 amounted to 7,535 million crowns, which corroborates the data given by the Norwegian Government, the writer of the German report says:
“This sum of more than 5,000 million Reichsmark is, indeed, very high for Norway. Much richer countries, as for example, Belgium, pay hardly more, and Denmark does not even supply half of this sum. These large payments can only be made possible by German additions. It is, therefore, not surprising that the German-Norwegian trade is in Germany’s favor—that is, it is subsidized. Norway, owing to her very small population, can hardly put labor at the disposal of the German war economy. She is, therefore, one of the few countries which owe us certain amounts in clearing.”
Further on, the writer adds:
“. . . If we deduct approximately 140 million Reichsmark from the expenses of the occupation and the various credits calculated above, we have Norwegian payments to the still considerable amount of approximately 4,900 million Reichsmark.”
THE PRESIDENT: Perhaps that would be a good time to break off.