Telegraph: Bank of England helped Nazis sell plundered gold

Bank of England has admitted its role in one of the most controversial episodes in its history - helping Nazis sell gold plundered from Czechoslovakia, months before WWII broke, Telegraph reports

Ynet

Published:  07.31.13, 16:41 / Israel News

http://www.ynetnews.com/articles/0,7340,L-4412168,00.html

Newly revealed documents from the Bank of England archive show the involvement of the bank in aiding the Nazis in selling stolen Czechoslovakian gold after the country was invaded. Throughout history, the Bank of England insists its role in the case was "widely misunderstood", The Telegraph reported.

The Nazis invaded Czechoslovakia in September 1938. In March the following year, the Bank of International Settlements (BIS) asked the Bank of England to switch £5.6 million-worth of gold from an account for the Czech national bank to one belonging to the Reichsbank. The British paper reported that documents revealed that much of the gold – nearly 2,000 gold bars – was then "disposed of" in Belgium, Holland and London. The BIS was chaired at the time by Bank of England director, German Otto Niemeyer.
 
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The UK central bank also sold gold to the Nazis in June 1939, without waiting for approval from Westminster, the British paper added. The documents unveiled that "There was a further gold transaction on the 1st June 1939 when there were sales of gold (£440,000) and gold shipments to New York (£420,000) from the No.19 account of the BIS."

This time, before acting, The Telegraph reported, the Bank of England referred the matter to the Chancellor, who said that he would like the opinion of the law officers of the Crown.

"On the BIS enquiring, however, what was causing delay and saying that inconvenience would be caused because of payments the next day, the Bank of England acted on the instructions referring to the Law Officers, who, however, subsequently upheld their action." Just three months later, the Government declared war on Germany, following its invasion of Poland, according to The Telegraph.

In the official history, the Bank insisted that it would have been "wrong and dangerous" for the future of BIS if Governor Montagu Norman took any other course of action, The Telegraph said. It claimed the UK and French governments would have breached peace treaties if they had blocked the move.

Historians have argued that Montagu Norman supported Germany right up until the Second World War. He reportedly attended the christening of the son of Dr Hjalmar Schacht, president of the Reichsbank before the war.

The Telegraph reported that his right hand man at the Bank was Otto Niemeyer who chaired the Bank of International Settlements which was set up in 1930 as a non-political body to facilitate the payments of reparations from Germany after the First World War.

After the outbreak of war, the documents reveal, the Government told the Bank of England it should not act upon an order from the BIS "if it seems to the Bank to be likely that the order might benefit the enemy", The Telegraph reported.