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Nazi Gold
Part 7:Turkey, Argentina and Nazi Gold

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Like other neutral countries, Turkey was bound to the Nazis through trade, but that’s where any similarities stop. Turkey descended from the Ottoman Empire and was primarily a Moslem nation. During the World War I, Turkey had aligned itself with Germany. Immediately following WWI, Turkey conducted a program of exterminating the Armenians, a charge that Turkey still vigorously denies. Moreover, Turkey began WWII bound to Britain and France by the military alliance of October 1939; declared neutrality in June 1940 after the fall of France; and ended the war allied with the Allies. Much of Turkey’s proclaimed neutrality was a result of Turkish fears of a Nazi invasion. After the fall of the Balkans to the Nazis, Turkey signed a Treaty of Friendship with Germany in June 1941.

Throughout the war, Turkey walked a tightrope, balancing the needs and expectations of the Nazis against those of the Allies. While Istanbul was a center of spying and intrigue during the war, Turkey took no overt action against the Nazis, and in turn the Nazis never violated Turkey’s borders. In October 1941, Turkey signed an important trade agreement with Germany. In exchange for raw material, especially chromite ore, Germany would supply Turkey with war materials and other finished goods. At the same time, Turkey maintained friendly relations with the U.S. and Britain, which supplied Turkey with modern war equipment in exchange for chromite ore. Turkey’s chromite ore was critical for the Nazis. Turkey was their sole source for chrome, a vital element in steel making. Albert Speer stated that Turkey’s chromite ore was so vital to the Nazis that war production would come to a complete stop 10 months after the supply was cut off. The ore was shipped from Turkey by rail through some of the most rugged country in the world. Towards the end of the war, the allies targeted bridges along the main rail line to stop the chromite shipments.

In 1941, Turkey was added to the lend-lease nations available to receive equipment. In January 1943, during the Casablanca Conference, FDR considered asking Turkey to enter the war. In November 1943, all three of the big leaders, Churchill, Roosevelt, and Stalin, called for Turkey’s entry into the war. In February 1944, after Turkey made its entry into the war contingent upon massive military assistance and a significant Allied military presence, Britain and the U.S. stopped their aid program. By 1943, the Allies foresaw no threat from a Nazi invasion. It wasn’t until April 1944 before Turkey ceased the chromite exports to Germany, and then only after being threatened with the same economic sanctions that the other neutral countries were under. Later in August, Turkey suspended all diplomatic relations with Germany. Late in February 1945, on the eve of establishing the United Nations, Turkey declared war on Germany.

Turkey was not a major receiver of gold from the Nazis. In fact, the best estimate of the US experts was in the range of $15 million dollars. Most of the gold was believed, to have been looted from Belgium. In addition, two private German banks, the Deutsche Bank and the Dresdner Bank, sold gold from the Melmer account in exchange for foreign currency.

Allied efforts to recover gold from Turkey were never pursued with any vigor. Turkey’s geographical location, controlling access to the Black Sea, and its border with the Soviet Union made Turkey a cornerstone for US strategic interests in the coming Cold War. In 1946, formal talks were held considering the gold received from the Nazis as well as German assets in Turkey. The Allies estimated that German assets totaled $51 million. In March 1947, the Truman Doctrine included Turkey along with Greece. In July, the US signed a $150 million trade agreement with Turkey. The trade agreement dealt a deathblow to any further negotiations on restitution.52 Turkey never turned over any gold.

Throughout the 1930s, Argentina was ruled by a succession of military dictators and fraudulently elected presidents. These regimes were weaken by their internal corruption and sought to legitimize themselves by reviving an ancient Hispanic alliance of the Cross and the Sword. The ties with Franco of race, religion, and language were emphasized. Some even called for undoing Argentina’s war of independence from Spain and was calling for rule by a Viceroy. The military leaders and the Catholic Church, urged on by the Vatican, dreamed of creating a Hispanic Catholic nation that could counterbalance the U.S. in the Western Hemisphere. By the time war broke out Argentina was divided into two camps, one pro-Nazi the other pro-Allied. However, Argentina’s foreign policy was controlled by Vatican connected operatives calling for a triangle of peace between Argentina, Spain and the Vatican.53

At the onset of the war in Europe, Argentina’s weak President Ramon Castillo announced a policy of prudent neutrality. Despite having agreed to the Havana Conference of 1940, in which an attack on any country of the Western Hemisphere would be considered an act of aggression on all American states, Argentina adhered to its neutrality policy. Argentina weakly defended its neutrality policy by claiming that any action undertaken in response to an attack was a matter for each state’s individual interpretation. Argentina had remained neutral during WWI and its’ economy benefited handsomely as a consequent. There was hope again that a policy of neutrality would revive the economy from the devastating depression of the 1930s.

In January 1942, Argentina agreed to the terms of the Rio Conference to sever all commercial and financial relations with the Axis powers. In June 1942, Argentina agreed to the Final Act of the Inter-American Conference on Economic and Financial Controls, obligating all states to end all commercial intercourse, direct or indirect, with the Axis. Argentina ignored the terms and continued with business as usual with the Nazis. Moreover, during 1942 Juan Goyeneche, a confidential agent of Peron and Adrian Escobar, the Argentina’s ambassador to Spain, traveled through war torn Europe, meeting with Nazi and Vatican officials. Goyeeneche collaborated extensively with the Foreign Intelligence Branch of the SS. Escobar and his consul Aquilino Lopez were collaborating with Himmler’s secret service by crossing into Vichy France and reporting details of Spanish and Allied diplomats.

After extensive meetings with the Vatican secretary of state, Cardinal Luigi Magione, an agreement was reached in which, once peace was established, Argentina would apply its immigration laws generously. This seemingly innocent meeting takes on critical importance at the end of the war. It proves that the Vatican was planning on helping Nazis war criminals escape from Europe as early as 1942. This meeting established the Vatican ratlines.

On October 10, the Pope received Escobar and welcomed Argentina’s view that it was appropriate for the Vatican to participate in the peace talks. Following the Vatican meeting in late October, Goyeneche traveled to Germany and met with Ribbentrop, seeking Nazi support for the nationalist candidate in the 1943 elections. This façade of neutrality would be maintained until 1943 and the colonels' revolution that eventually brought Peron to power.

Once the colonels were in power, they first sought arms from Germany in case war broke ought between Argentina and Brazil. By September 1943, the colonels gave up the idea of smuggling arms into Argentina from Germany and instead sought an alliance with Nazi Germany. The group of colonels dispatched Osmar Hellmuth and Carlos Velez to Spain to negotiate with the Nazis. Unfortunately for the colonels, US Magic intercepts had detected the upcoming mission from transmissions between the SS agent in Argentina, a Captain Backer and Schellenberg in Germany and had the British seize Hellmuth when the ship docked in Trinidad.

The seizure of Hellmuth failed to deter further plots. Peron and Becker continued to plot overthrowing neighboring governments to set up a pro-Nazi block in South America. Peron wrote in a secret manifest of the colonels as follows.

"Forming alliances will be the first step. We have Paraguay; we have Bolivia and Chile. With Argentina, Paraguay, Bolivia and Chile, it will be easy to pressure Uruguay. Then the five united nations will easy draw in Brazil because of its type of government and its large nucleus of Germans. With Brazil fallen, the American continent will be ours."54

On December 20, 1943, a military coup in Uruguay installed General Gualberto Villarrod as president. Peron and Becker had planned the coup. American counterintelligence was aware of the coup through Magic decrypts of Becker’s transmissions from Argentina. The coup however, was a failure for the Nazis. Using material from Magic decrypts, the US twisted Argentina’s arm. Facing the U.S. threat to release the decrypts and Hellmuth’s admissions from interrogations implicating Argentina’s role in the coup, Argentina was forced to break off diplomatic relations with the Nazis in January 1944. However, Argentina maintained its neutrality and did not declare war against Germany until a month before Hitler’s suicide.


During the final year of the war, Argentina was a prime destination for many of the assets that Bormann was spiriting out of Germany for a rebirth of the Third Reich. Following the war, Argentina was also a prime destination for Nazi war criminals. Even war criminals that escaped to other South American countries generally first entered the continent through Argentina. While other South American countries generally supported the US policies during the war, there was no cooperation forthcoming from Argentina. Other countries adhered to the Proclaimed List and took steps to eliminate any smuggling efforts. The Treasury Department urged harsher actions towards Argentina than what the State Department was willing to implement. The State Department was hampered by a fear that a harsher policy would alienate other South American countries and by a difference of opinion with the British. During both world wars England depended upon Argentina for beef. However, as early as 1942, Argentina’s neutrality policy made it a leading focus of the Treasury Department and the Board of Economic Warfare.

The large number of German companies in Argentina allowed the profits to be turned over to the Nazi’s espionage organizations in turn for Reichsmark credits in Germany. The Treasury Department also suspected that Argentina made substantial amounts of foreign exchange available to the Axis countries, accepted the entry of large amounts of looted currency and securities into its markets, and allowed German firms to cloak their assets. A FBI report released in June, 1943 described how Buenos Aires served as the Western Hemisphere outlet for U.S. bank notes that had been looted in occupied Europe and entered into commercial traffic in Switzerland.55

Throughout the war Argentina served as a hub for Nazi smuggling operations. Bulk items of trade were easily stopped by the blockade. However, critical items of small size, such as industrial diamonds and platinum were especially needed by Germany and could be smuggled through the blockade on a regular basis. Immediately after Pearl Harbor, Morgenthau wanted to freeze Argentina’s assets. In May 1942, Morgenthau presented evidence to President Roosevelt that numerous Argentine companies were cloaking German funds in the United States and that Argentina had recently sent over $1,000,000 to the United States in looted currency. However, Roosevelt continued the policy set forth by the State Department. After repeated requests from the Treasury Department, the State Department agreed to an ad hoc blocking of selected Argentine accounts in October. Over 150 individuals and firms in Argentina were added to the Black List.

Safehaven negotiations with Argentina started in 1944 and were restrained by the distressed relations. In February 1944, Argentine President Ramirez delegated his powers to General Edelmiro Farrell. The US failed to recognize the Farrell government and recalled the ambassador. In August and September the State department announced additional sanctions against Argentina due to its failure to comply with the denazification of Argentina. In response, Argentina withdrew from the Montevideo Committee for the political defense of the continent. The Argentine Central Bank thereafter provided little help to U.S. investigators in locating German assets. After Cordell Hull resigned as Secretary of State in November 1944, the incoming secretary, Edward Stettinius, formulated an easier policy towards Argentina. Nelson Rockefeller, the appointed wartime chief of South American intelligence, also favored easier terms with Argentina. Rockefeller controlled banks had illegally transferred funds between the U.S. and Argentina from frozen accounts.

On February 7, 1945, Treasury Secretary Morgenthau suggested to Acting Secretary of State Joseph C. Grew that a special Treasury representative be sent to Argentina in order to uncover and control Nazi external assets in Argentina. Grew rejected the request, citing political considerations. In early 1945, as a resolution in support of Bretton Woods Resolution VI was passed by the Inter-American Conference on War and Peace held in Mexico City. The resolution, known as the Act of Chapultepec, however, did not grant control of Nazi assets in Latin American countries to multinational governing bodies, but recognized the right of each of the American Republics, including the United States, to German property within its own respective jurisdiction. Due to its continuing pro-Nazi policy, Argentina was excluded from the meeting. Recognizing its increasing isolation from other nations of the Western Hemisphere forced Argentina to declare war against Germany in the last month of hostilities.

On February 11, 1946, the State Department released the famed Blue Book on Argentina. The book confirmed that the Argentine government asserted no control over German firms and the efforts to seize their assets were delayed until those assets could be dispersed elsewhere. The book also confirmed that Nazi Germany transmitted large sums of money to its Embassy in Argentina without any serious obstacles. Some historians credit the release of the Blue Book for the election of Peron due to an anti-American backlash. On May 22, 1946, the Safehaven team reported the total value of German assets at roughly $200 million. The assets included bank balances, real estate, merchandise, and the like. No caches of art or gems were found and the team concluded that Argentina was not a major destination of looted treasure. Moreover, the team reported that no records revealed Argentina as a recipient of Nazi gold.

As early as 1942, the U.S. had knowledge of illegal Argentina currency dealings. In April 1942, the U.S. Consulate in Switzerland reported that an Argentina diplomat was smuggling dollars stolen by the Nazis to his homeland for sale; the proceeds were then transferred to Switzerland. British cables from 1944 show Argentina conducted vigorous trade with Switzerland and often the payment was in gold. By 1945, the State and Treasury Departments had found conclusive evidence of extensive transactions involving the transfer of Argentine pesos, Reichsmarks, and Swiss francs from Argentina to Switzerland. In May 1947, Argentina proposed a transfer of $170 million to its Federal Reserve account. Concern over the source of the gold delayed the transfer only momentarily. Guyatt, reports that in 1973, when Peron returned to power 400 tons of gold belonging to Peron was put up for sale on the black market. 87 Peron’s code-named the sale Bormann 1345. While the Spanish government tutored the sale, the transfer agent labeled the sale as political in nature. Despite the massive increase in Argentina’s gold reserve and the number of Nazi war criminals that found sanctuary in Argentina, even after fifty years there is little proof of Argentina accepting gold from the Nazis.

The Cold War badly compromised the Safehaven operation in Argentina. On June 3, 1947, President Truman and Argentine Ambassador Ivanissevich issued a joint announcement the two countries would renew consultations with other Latin American countries about creating a treaty of mutual assistance. In September, Argentina joined the United States and other American Republics in agreeing to the Inter-American Treaty for Reciprocal Assistance, the Rio Pact, for mutual defense against aggression. Bormann’s cloaked companies in Argentina, as well as any treasure was safe and secure. The hemisphere had to be protected from communism.

On April 10, 1941, following the Nazi invasion of Yugoslavia the so-called independent state of Croatia was established; headed by Ante Pavelic, a member of the fascist Croat Ustasha political movement. Croatia was declared a protectorate of Italy and was supported by both Italy and the Nazis. The Usrashi were also closely aligned with the Vatican. On May 18, 1941, Acting Secretary of State Sumner Welles reaffirmed the exile government of Yugoslavia did not recognize the independent state of Croatia. Shortly afterwards, Croatia sealed the U.S. embassy in Zagreb. Since Croatia only existed as a state during the war, and the U.S. never recognized the state, the figures presented in this section are much more likely to be subject to revision in the future.

Postwar reports indicate the Ustasha treasury had at their disposal more than $80 million of mostly gold coins, some of which the Ustashi stole from the victims. On May 31, 1944, Croatia deposited $403,000 in the Swiss National Bank. On August 4, 1944, Croatia deposited another $1.1 million in gold. An OSS report in July 1945 concluded that Croat-owned commercial accounts in Bern totaled more than $93,000. The Historical Section of the Task Force of the Swiss Federal Department of Foreign Affairs indicates the Swiss National Bank returned all 1,338 kilograms of gold in 121 ingots in the account of the wartime Croatian regime to the National Bank of Yugoslavia on July 24, 1945.

While the bank records of deposit are not likely to change much, the amount of gold the Ustashi carried with them as they fled to Austria as the war was reaching an end is very much in doubt. Estimates placed the value of gold Ante Pavelic had when entering Austria at $5-6 million. Whatever the value of the loot the Ustashi escaped with it is certain that much of it was used to set up and run a ratline jointly with the Vatican. In an October 1946 U.S., intelligence (SSU) reported to the Treasury Department that they believed the Ustashi had $47 million deposited in the Vatican before the Ustashi transferred it to Spain and then to Argentina. Due to the Cold War the Allies expanded little effort in returning the thousands of war criminals from Italy to Yugoslavia. The issue of Ustashi gold received even less attention at the war's conclusion.