There is a footnote at the bottom that states that tickets may be
obtained at various NSDAP (Nazi Party) Offices. General admission was 50 pfennigs for the
public, 40 pfennigs for Nazi Party members.
Operation Bernhard
German counterfeit 5 pound note
We should very briefly mention what has been called the greatest counterfeiting
operation of all time, Operation Bernhard. This was not a propaganda campaign, although
the very same people who prepared the banknotes were also involved in a PSYOP campaign to
parody British postage stamps with Communist and Jewish symbols. Operation Bernhard was
instead, a secret German plan devised during World War II to destabilize the British
economy by flooding the country with forged Bank of England £5, £10, £20, and £50
notes of 1934.
This was not the first wartime attempt to counterfeit the money of Great Britain. In
1939, Reinhard Heydrich decided to destroy the economy of Britain by flooding it with fake
banknotes. He authorized “Operation Andreas,” commanded by SS Major Alfred
Naujocks, who was given a budget of 2 million Reichsmarks. His technical director was Dr.
Albert Langer. In April 1940, the never-patient Reinhard Heydrich ordered Naujocks to
counterfeit Norwegian currency, and when told that the effort would at least four months,
he fired Naujocks.
The plan was code-named “Operation Andreas” because the British flag bore
the Cross of St. Andrew. The Germans thought that it looked like an “X.” In the
same way they wanted to strike through the value of the pound, thus making it worthless.
Heydrich did not want to use criminals to make the banknotes, and as a result the
plan never went into full production. By early 1942, Langer claimed that his Operation
Andrew unit had produced 200,000 five-pound notes and 200,000 ten-pound notes. The project
lacked the skilled labor force necessary to go into mass production, and as a result of
internal squabbling among Nazi SS officials, Operation Andrew sputtered to a halt. It is
probably just as well. Reichsbank Minister Funk stated that the plan was untenable and he
could see no way to deliver the banknotes to England. Operation Bernhard also refused
to use criminals preferring to use Jewish concentration camp inmates until the need for a
counterfeit U.S. banknote eventually brought a professional counterfeiter into the fold.
The paper for the counterfeits was originally prepared at the Hahnemuhle paper mill
near Dassel.
SS Major Bernhard Kruger
The second and far more successful plan was directed by, and named after, SS Major
Bernhard Kruger, who set up a team of 142 counterfeiters at the Sachsenhausen
concentration camp. The Germans scoured the Concentration Camps for Jewish printing
experts. A memorandum to Camp Commanders said:
Recruitment of Jewish Prisoners
Prisoners in the camp who are qualified in the printing trade such as paper
manufacturing printers or suitable craftsmen are to report to me immediately.
In Kruger’s Men, Malkin mentions Krueger’s preconceived notions about
Jews, possibly from his SS indoctrination. The Jews who were brought to him
were not counterfeiters. They were people with some knowledge of printing.
He tells August Petrich that he will have to teach these prisoners all he
knows about printing. Then he admits:
Are there really artisans among Jews? I thought they were traders, brokers,
capable stock market and businessmen, experienced doctors, and lawyers. I
find it a unique story, Almost like an April’s Fool joke…Imagine, graphic
artists, engravers, repro-photographers and so on from Jewish inmates.
Murray Teigh Bloom tells us a bit about Kruger, (edited for
brevity):
In September 1940, Kruger was assigned to the 6th Directorate of
the Reich Security Main Office (RSHA). In the same year, he was sent to
France with a special assignment. He was tasked with obtaining American,
Canadian, English, and other passports, identity cards and other documents,
which were then used as samples…Kruger was later appointed as a head of the
4th Department engaged in photography and the production of forgeries.
On 8 May 1942, Kruger was appointed the head of the Nazi British
banknote counterfeiting operation. He immediately confiscated took all the
machinery and products from the earlier Andreas banknote Operation.
An Operation Bernhard printing plate can be seen at the International Spy Museum in Washington D.C
The research on, and production of the British banknotes began in 1942. The major
problem was the engraving of the complex printing plates and the breaking of the British
code used to generate valid serial numbers. One of the experts on the team was Salamon
Smolianoff, a Russian who had been forging British 50-pound notes since 1927 and who had
been arrested and jailed in Amsterdam for counterfeiting. Another was Adolf Burger, a
Slovakian Jew who had been trained as a printer. According to Burger, who wrote two books
about his experiences, the forgers at Sachsenhausen also successfully copied the U.S. $100
bill.
At least five of prisoners who took part in “Operation Bernhard” published
their memoirs. Moritz Nachstern was the first. His book was published in
Norway, in 1946, and in 2008 was republished and translated into many
languages of the world.
Number 64401 Remembers
In Uncle Krueger's Money, Dmitriy Litvak tells us about other
authors:
Counterfeiter Adolf Burger returned to Czechoslovakia after the war. The
first version of his memoirs was recorded in 1945 by Czech journalists
Silvia and Oskar Cresci under the title Number 64401 Remembers and
was published only in Czechoslovakia. The book cover drawing for the first
edition was done by Leo Haas. Later, in the 70s, Burger wrote his own
memoirs. This memoir was translated and republished in the DDR (in 1983),
under the title The Devil's Workshop. The film The Counterfeiter,
based on Burger's book, won the 2008 Academy Award for Best Foreign Film.
In The Devil's Workshop Burger says in part:
In September 1944 Kruger appeared in his forgery workshop and announced.
Gentlemen from today we are going to produce dollars too.
There were special rooms set aside for the dollar group. New machines and different
paper arrived from Berlin. Soon after Kruger brought in real $50 and $100 bills and gave
them to Jacobson the foreman.
The eight of us worked in isolation from the other prisoners. No one else was allowed
to enter the three rooms in the back part of that block.
The last project in the forgery workshop was production of $50 and $100 bills. Only two
hundred $100 bills were printed.
Kruger told Himmler of the success by phone and assured his boss that everything was
ready now for the production of forged dollars.
"A million forged dollars a day are to be produced working in two 19-hour
shifts." It was then 12 February 1945.
But before production could start Berlin was being attacked by the Allies.
Burger says that an order from the Reich Security main office ordered the work to stop
the machinery to be dismantled
SS Major Bernhard Kruger in Postwar British Captivity
Most references to Bernhard Kruger tell of him driving away from the concentration
camp with a satchel full of counterfeit money at war’s end. In fact, Kruger was
arrested first by the French who held him for about two years trying to convince him to
forge for them, and then by the British who questioned him in depth about his wartime
counterfeiting.
When I interviewed Kruger in the 1950s he was a very bitter man who felt
he had been mistreated by the allies. In fact, as a former SS officer, he probably got off
much lighter than he should have. We
talked about many subjects. Some of his comments on the counterfeit currency
were:
My duties within the context of psychological and economic warfare
were limited to the currencies of the British Pound and the US Dollar. Both
currencies take the lead in international payments. Therefore, the numerous
other currencies were not interesting enough. You certainly know that the
allied secret services also forged currencies but in a lesser degree than
Germany. For instance, the German Reichs credit certificates
Reichskreditkassenschein)) that circulated as a means of payment in the
territories that were occupied by German troops.
If I don’t err, your knowledge is based on the book “Unternehmen
Bernhard” by Dr. Wilhelm Höttl of Oberaussee, Upper Austria who publishes
under the pseudonym Walter Hagen.
The press as well as the TV stations reproduced, without verifying
the truth, the related passages of the above-mentioned book. The same did
the journalists who were interested in the subject. That went well until
some forgers of Operation Bernhard who lived in Vienna took legal action
against these allegations. The two accused journalists tried to justify
themselves by referring to the passages in Dr. Höttl’s book. Therefore, the
author Dr. Höttl aka Walter Hagen was heard as a witness before the court of
Vienna. This resulted in Höttl’s admission that he had never and at no time
had anything to do with the Operation Bernhard. This admission and the
statements of the accusing forgers led to the fact that there were never
medals, awards, or prizes for the forgers. Furthermore, another result of
the judicial proceeding in Vienna was the conclusion that the forgers were
not criminals, like Dr. Höttl absurdly and untruthfully had stated in his
book. According to Hitler’s order only individuals of Jewish descent were
allowed for the work who were not imprisoned due to criminal activities but
only (imprisoned) because of their religious confession. There is only one
exception, a forger who was not a Jew but a criminal. He was a professional
forger of US dollar notes and became known only in 1944 with Operation
Bernhard. Your question how the Jewish prisoners got along with the others
is therefore obsolete, although there were problems among themselves.
I pulled the Höttl book out of my library to what so angered
Kruger. Höttl says in part:
Kruger rang me up in my office in Berlin to ask for my help in an
application for military decorations. He had applied to Schellenberg for
some, as a reward for good work on the part of his staff and had been
refused although it was only a question of the most modest awards. To the
best of my recollection, it was 12 good service medals and six good service
crosses of the 2nd class…Naturally I was glad to do Kruger this service.
Kruger was delighted, but it did not turn out so well for me. Only some of
the decorations were for the members of the SS and the civilians employed by
Kruger. The good service medals were bestowed on deserving prisoners in the
Concentration Camp…Three of them were Jews. The Commandant of Oranienburg
almost had a stroke when he was confronted by the proud display of
decorations during an inspection…Kaltenberger had a sense of humor, He
congratulated me on having been the first to award military decorations to
Jews.
I asked Kruger if he has saved any of his products, the stamps, and
banknotes of Great Britain, as all the Allied Propagandists had done.
Your question as to why I don’t have a collection like this is
easily explained. I was in French captivity until May 1949. After my release
I was ill for a long time due to the conditions during captivity. Afterwards
I had no income for quite a while. I therefore had neither the time nor the
financial resources to build up a collection of this kind. Later, it was not
worth the trouble because of the high costs due to the rising demand.
An Operation Bernhard British 100-pound plate
We catch Kruger in little lies here and there. For instance, every
reference we read about the counterfeiting operation says that the Germans
just did four notes with the highest denomination being 50 pounds. And yet,
a diving club of Lake Toplitz
called Tauchclub Dachstein-Salzkammergut said in 2012 that they found a plate for a 100
pounds banknote. They also found the dateline that was to be added to the
counterfeit note.
The 50 Franc banknote of France Plate
Kruger also seems to have been involved in the printing of French
currency. We don’t see any actual notes at the bottom of Lake Toplitz, but
there are numerous printing plates, so the project was undertaken, but
perhaps never completed. Some of the French plates in the denomination at
the bottom of the lake are 50, 100, and possibly 500 francs.
The 500 Korun banknote of Slovakia
The Germans also counterfeited the 500 Korun banknote of Slovakia
of 1941. Some bags of these forgeries were found floating in the
Hallstätter See in 1970 and on later occasions. Others were found at the
bottom of the lake. This is another of the Austrian lakes the Nazis used to
hide incriminating material. It is situated a few miles west of the Toplitz
lake. There enough of these banknotes found that they can be bought in
Europe for 200 Euros plus VAT tax.
An undated article in the newspaper Oberösterreichischen
Nachrichten, mentions the find of a bag full of Slovakian fake banknotes
in the Hallstätter lake by schoolboys. Their find was not the first, because
the article started:
In the summer of 1970 fake banknotes of about 30 million Kronen
that were discovered floating in bags on the Hallstätter See caused a great
sensation. The Ministry of the Interior investigated…It is confirmed that
the banknotes were left at Hallstatt by members of the Slovakian secret
service, who were there at the end of the war. One of the most prominent
members of the Slovakian party who sought shelter in the “Alpenfestung
Salzkammergut”
[An Alpine fortress of the Salzkammergut district] in the last days of
the war was the Slovakian chief of government, the priest Josef Tiso, who
was killed in 1947 as Hitler’s ally in WWII. The keepers of the fake
banknotes threw them into the lake to get rid of them. The Austrian police
did not pursue the matter because the banknotes were completely worthless,
and it was not worth employing a diver.
German specialist Wolfgang Baldus and I had a conversation about
these forgeries. He said:
Counterfeit money for Slovakia would make sense. The Slovakian
fascist priest Jozef Tiso could do with it the same as the Germans did: pay
agents, buy gems or gold or art paintings abroad, sell the stuff in
Switzerland or wherever in exchange for genuine currency or other
unsuspicious valuables such as the Germans did, but all for the benefit of
the Slovakian treasury. After several bags were found in the Hallstätter
lake in the 1970s, some people offered to tell the story to the police as
well as to some magazines, provided they would remain incognito. None of the
organizations wanted to grant that secrecy and thus the story is still
untold.
Tiso was a Slovak politician and Roman Catholic priest who served
as president of the Slovak Republic, a client state of Nazi Germany during
World War II, from 1939 to 1945. Tiso collaborated with Germany in
deportations of Jews, deporting many Slovak Jews to extermination and
concentration camps in Germany and German-occupied Poland, while some Jews
in Slovakia were murdered outright. Deportations went on between 25 March
1942 until 20 October 1942. An anti-fascist partisan insurgency was waged,
culminating in the Slovak National Uprising in summer 1944, which was
suppressed by German military authorities with many of its leaders executed.
Consequently, on 30 September 1944, deportations of Jews were renewed, with
additional 13,500 deported. In 1947, after the war, Tiso was executed for
war crimes and crimes against humanity in Bratislava.
So, the Slovakian fake banknotes were found both in the Hallstätter
and the Toplitz lakes.
Some of the boxes discovered in the salvage operation
The German magazine Stern received a permit from the
Austrian government to conduct a salvage operation in the Toplitzee
in July 1959. They brought boxes of counterfeits and items to the surface.
This salvage went on both legally and illegally for years afterwards leading
to some deaths. In 1963 and 2000 the salvage returned. Besides the
banknotes, gold, jewels, and other Nazi stolen booty was brought up from the
deep.
I want to take just a moment to mention that the Germans were in
full retreat. The Bernhard counterfeiters and their machinery and crates of
banknotes and other treasures were racing through the mountains and valleys
trying to keep a step ahead of the advancing enemy troops. As time seemed to
be running out, the enemy got closer, the SS troops panicked, and vehicles
broke down or were abandoned, there were many places that the items were
dumped in rivers and lakes with the idea of possibly bringing them back to
the surface at some future time when the Allies were gone, and it was safe
to do so. I was never very interested in the various places, but researcher
Kenneth Pugh did list them so perhaps I should mention them to my readers.
He mentions the Bernard group first reaching Mauthausen concentration
camp, then Redl-Zipf concentration camp, then Ebensee and
finally scattering in the rugged mountainous terrain of Traunsee and
Toplitzee. He adds:
Some trucks made it only as far as Lake Traunsee where their cargo
was dumped into the lake. SS Obersturmfuehrerr Hansch received assistance
from Wehrmacht Marine troops stationed at a U-boat equipment and torpedo
testing base at Toplitzee and dumped his entire cargo into the cold, deep
waters of the lake. One of SS Officer Hansch’s trucks transporting
counterfeit notes and printing plates broke down. The items in that truck
were dumped in the Enns and Traun Rivers.
These are the
places we know about. How many more Nazi records and treasures were dumped
in other places and forgotten? I think there might be many more such
treasures hidden away in forgotten and hidden lakes. Now, back to the story.
Burger also says regarding to the dollar project that the inmates selected to
counterfeit the U.S. dollar were Solomon Smolianoff, Norbert Levy (chief of the
photographic department), Abraham Jacobson (director of the copy department), Adolf Burger
(typographer) and Leonard and Roger Weill (retouchers). The painters Leo Haas and Peter
Edel would assist them as needed.
In a top secret interrogation after the war Jacobson stated that he started forging
U.S. dollars in May 1944. He claims they planned to print $50 and $100 bills, and although
5000 pieces were made, they were never numbered or left the plant. It seems that every one
of the counterfeiters told a different story after the war and since there probably was
some compartmentalization, it may be that they are just telling us the rumors
that they heard from each other.
The main problem was to find an adequate printing method. Genuine dollar notes were
printed in what Burger calls tiefdruckverfahren, which
can be translated as “engraved (intaglio) printing”but the inmates did not
have the correct type of printing press. It was decided instead to print the notes in the Lichtdruck
process. This method uses a glass plate that is covered with light-sensible gelatin layer
on which the film negative is exposed. No screening is necessary to reproduce halftone
pictures, but only up to 1.000 copies can be printed from one plate. A typical feature of
this seldom used printing process is the wrinkled grain that is seen instead of screen
dots under a magnifying glass. Burger claims that they attempted to counterfeit $50 and
$100 banknotes with the Lichtdruck process. He says that only two-hundred copies of
the $100 note were printed.
I probably should not editorialize since this article is entirely factual, but I
feel that I must make some comments here. The vast majority of the information about this
operation comes from former Jewish concentration camp inmate counterfeiters. They lived in
relatively good conditions while all around them their fellow inmates died of starvation,
disease and ill treatment. There probably is survivor guilt. In addition, the inmates were
helping their sworn enemies win the war. We understand why they acted as they did, but
they were by definition, collaborators. As a result, many of the inmates now talk about
how they fought the Germans and sabotaged their efforts, and Burger, in his autobiography,
becomes practically a one-man sabotage machine. I think we need to be very critical when
we read these reports and ask ourselves if they are totally reliable. In the various
interviews you will read that no $100 bills were printed, the backs of some $100 bills
were printed, One-hundred or two-hundred $100 bills were printed, and perhaps even $20 and
$50 bills were worked on. It is difficult to know what really happened.
The German-language movie Die Falshers (The Counterfeiters) based on
Burger’s book depicted the inmates handing Major Kruger forged American banknotes.
The Czechoslovakian Report on the Berhard Forgeries
This is probably the
first published report on the German counterfeits; the classified “Secret”
booklet is dated 15 December 1945.
By the time Sachsenhausen was evacuated in April 1945, according to Chief Inspector
(later Chief Superintendent) William Rudkin of the London Metropolitan Police, the
printing presses there had produced 3,945,867 £5 pound notes, 2,398,981 £10
pound notes, 1,337,335 £20 pound notes and 1,282,902 £50 pound notes for a
total on £134,610,945 pounds. The Germans used them all over Europe for espionage and
covert operations, purchased weapons with them from partisan bands, and even paid their
spy "Cicero" in the British embassy in Turkey with the counterfeits. The notes
are considered the most perfect counterfeits ever produced, being extremely difficult to
distinguish from the real thing. The best grade was used by German spies in enemy
countries and for purchases in friendly or neutral countries. The second best grade was
for collaborators and informers. The third grade would have been dropped over the British
countryside to destroy its economy. This never happened because it was impossible to
produce enough notes to destroy an economy, and worse, it would tip off the British that
their notes were being counterfeited. The last grade was destroyed.
Nazi Counterfeiting of British Currency during WWII
The most detailed examination of the German propaganda notes is
probably Nazi Counterfeiting of British Currency during WWII, written
by Bryan Burke in 1987 in a limited edition of 100 books.
Did the Germans really counterfeit U.S. currency? Sachsenhausen Concentration Camp
inmates were interviewed at the end of the war at the Seventh Army Interrogation Center.
Two Jewish prisoners, Jacob Goldglass and Henrik Fajermann stated on 20 May 1945 that the
counterfeiting team that had produced millions of fake British pounds had planned to
counterfeit American banknotes late in the war. The secret report stated:
The camp had thirteen machines for the production of British pound notes and two
machines for the production of American dollar bills. The latter could not be produced
because of the lack of suitable paper.
Hans Walter, one of the original Bernhard forgers spoke of his experiences in 2009.
There was not much new in his comments, but it is nice to have facts verified by one of
the forgers. He said that barracks 19 was sealed off from the remainder of the camp and
there was no contact with the other prisoners. The Camp Commandant was not even aware of
the work being done there.
His job was to inspect the forged notes and to put them into one of five categories
(not four as mentioned elsewhere in this article). Has believed that the best notes,
category one, were for shipment to England (through Chicago and Switzerland). The next
grade was to be sent to the English colonies. The third grade was to be used in sabotage
operations at the front and in Africa and Egypt. Grade four notes were to be dropped over
England to disrupt the economy and the poorest of the forgeries were discarded.
Hans said that Bernhard Kruger would come to visit once or twice a week. The hardest
portion of the British note to copy was "Britannia" because of the large amount
of details in the figure. There were no secret marks applied to the notes and none of the
prisoners ever got any of the forgeries out of the camp.
After successfully forging the English notes, Hans said that his fellow prisoners set
about to make U.S. one hundred dollar bills. The green color of the ink created a problem
but that was overcome. To complete the process would have resulted in the gas chamber so
the prisoners decided to slow the project. Hans said that in mixing the ink he added a
little machine oil to the mixture so that when the green ink dried some of it would come
off when rubbed by a finger. Kruger took notes to a German printer to try to solve the
problem but they could not.
A declassified report entitled “Counterfeiting Activities of Section 6-F-4 in
the Reichssicherheitshauptamt” (German Main Security Office) agrees:
It was also planned to produce American dollars. Section 6-F-4 already possessed the
necessary engraving plates but had not been able to produce a satisfactory paper. The
paper on hand was much too stiff and had other failings.
We know that part of the block 18 dormitory was cleared for the dollar workshop in
May 1944. There is a theory that Kruger was willing to have the project linger on since a
successful ending or total failure meant his inmates would be executed and he might find
himself on the Eastern Front facing the Russians. As a result, the dollar project
stretched on and on. Anthony Pirie says in Operation
Bernhard, William Morrow and Company, NYC, 1961:
Early in January 1945, Kruger received a phone call from Sachsenhausen. Soon
afterwards, in Block 19, he was minutely examining the first run of the new dollar notes
– a hundred samples of the hundred-dollar bill.
Burke adds in Nazi Counterfeiting of British Currency During World War II, The
Book Shop, San Bernardino, CO, 1987:
On the 6th of January 1945, a selection of notes was shown to Himmler in which,
it is said, he could not separate the genuine from the copies. The engraving was much
harder than for the simple Bank of England notes, but the numbering system proved to be
quite easy to break…Some of the prisoners involved thought that about 200 of the $100
notes were printed. McNally [a U.S. Army major who had served in the American Secret
Service and was appointed to Germany after the war to protect the occupying forces from
counterfeit currency], in his investigation, estimated about 6,000…
Lawrence Malkin says in Kruger’s Men, Little, Brown and Company, NYC,
2006:
Within two days they had printed what Smolianoff [the one true criminal
counterfeiter in the group – known by a dozen aliases] judged a “pretty fair
copy of the back of a hundred dollar bill. Across a table the Dollar Group spread fifteen
genuine greenbacks with their fake demonstration bill. Without a magnifying glass, it was
hard even for the forgers themselves to distinguish the counterfeit.
The group then started work on the front of the $100 note and after a week they had
a suitable $100 counterfeit note. The inmates were ordered to produce one million dollars
of U.S. currency a day.
Arlie Slabaugh says in Prisoner of War Monies and Medals, Hewitt Brothers,
Chicago, Il, 1965:
Late in 1943 it was decided to counterfeit U.S. currency…By late fall
1944the reverse of the $100 bill was finished, approved and retouching began on the face.
Twenty $100 bills were produced which passed
inspection except for the U.S. date and serial number which had not yet been solved. The
paper had finally been imitated but due to the bombings the factory could not produce the
quantity needed. The U.S. $100 bill never went into production. The plates were destroyed.
The Counterfeit specialist Murray Teigh Bloom, author of seven books on currency,
wrote in an International Journal of Intelligence and Counterintelligence article
entitled “Uncle Sam: Bashful Counterfeiter” that the Germans attempted to
counterfeit a U.S. $20 note. He says that the operation proceeded so slowly that it was
never completed. I have seen no other evidence of this denomination being counterfeited.
So, although there is no evidence of the German counterfeits ever being put into
circulation, there are numerous written references to them being printed.
The Money Game
The artist Mort Kunstler painted a scene of the counterfeit currency workshop of
Sachsenhausen concentration Camp entitled “The Money Game.” The scene is
explained in advertisements as:
In the dark recesses of Barracks 19 at the Sachsenhausen concentration camp, a
German SS officer examines a sample of counterfeit U.S. currency being manufactured for
distribution in an effort to undermine the economy of the United States. Unbeknown to
Hitler and his cohorts, the scheme would never reach fruition as the conspiracy would be
thwarted by an allied victory in Europe.
What is interesting about the painting from the artist known for his historical
accuracy is that it depicts a counterfeit $50 banknote, one that
may
have never been counterfeited
by the Jewish inmates in the camp. Most written references state that only the $100 note was counterfeited, as reported in
the classified “Secret” December 1945 Czechoslovakian Ministry of the Interior Report on Forgery in Sachsenhausen Concentration Camp.
Translated to English it says in part:
…Kruger brought in about fifty 100 dollar bank notes…For whole months
the work did not produce satisfactory results…Faults could be seen in the application
of color. At other times they filed to achieve the right tone of green for the reverse
side of the 100 dollar notes. 220 experiments were made altogether until at the end of
December 1944 they were able to begin on the production of the bank notes…But
although the prisoners had an ultimatum from Himmler to manufacture dollars, the actual
production was never carried out…Altogether about 200 one hundred dollar bank notes
were printed. These were left in the camp.
A $100 Bernhard Forgery?
Researcher Kenneth Pugh depicted what is alleged to be a Bernhard
Kruger $100 counterfeit Bernhard banknote in a discussion with the British
Empire Stamp Group. He did not recall where he first found it. I have
never seen such a note in my research so if it is as advertised this is
very interesting and rare.
There seems to be a lot of confusion about the American counterfeit
dollars, although most comments seem to agree that two hundred $100 dollar
bills were produced. Some of the many comments we find in print are:
Prisoners engaged in the production of dollars testified that
200 pieces of 100-dollar bills were issued...McNally, by contrast, points
out 6,000 in his report...At the end of 1943, it was decided to start
issuing American dollars... At the end of 1944, the reverse side of the
100-dollar bill was completed, and work began on the front side. 200 pieces
of one-hundred-dollar bills were produced, which were checked, except for
the numbering system.
John K. Cooley says in Currency Wars, Skyhorse Publishing, NYC, 2008:
Kruger turned over some genuine $50 and $100 notes to copy…The SD leadership
had originally demanded that the team produce 200 perfect $100 specimens…On the two
hundred and fiftieth attempt…The result was twenty-four perfect $100 counterfeits.
During the same night, the team printed the required 200 bills, face value $20,000.
On the other hand, Wilhelm Hottl says in Hitler’s Paper Weapon, Rupert
Hart-Davis, London, 1955:
Kruger had enlisted one of the world’s outstanding experts in forging
dollars. A Bulgarian gypsy named Solly Smoljanoff; he was also known by
many other names to the police of all nations. Smoljianoff assured Kruger
that he could make first-class plates for fifty- and hundred-dollar notes
and produced the first examples by the end of 1944…when the first dollars
were delivered in early 1945, they were turned down because of defective
paper…
Moritz Nachtstern talks about his experiences as a forger in Sachsenhausen and says
that there were $50 bills produced in Counterfeiter – how a Norwegian Jew survived
the holocaust, Osprey Publishing, Oxford, U.K., 2008. The counterfeiters talk about
their work at different times:
We will soon begin the manufacture of 50-dollar bills en masse. I swear old Uncle
Sam is going to be so bloated with dollar bills that he will burst…
It won’t be long and you’ll see a 50-dollar bill that beat everything
in the industry. It will be my life’s masterpiece…
Are you completely finished with it? Does it look good? You should have seen
Kruger. He embraced me and carried on like a maniac. I can tell you this men; if anyone
has produced a better 50-dollar bill than mine, he has not been discovered.
So, at least three authors believed that the Germans attempted to counterfeit a U.S.
fifty dollar bill. Perhaps Mort Kunstler got the idea from Hottl.
Mort Kunstler and Author
In 2006 the author was asked to display and explain American
and foreign weapons and uniforms as part of an exhibition of Mort Kuntsler's
military paintings.
Operation Bernhard seems to be the story that lives on forever. On 18
August 2011 a set of the four counterfeit notes was auctioned in Great Britain. The four
banknotes were recovered from Lake Toplitz in Austria and estimated at 2,000 pounds. That
seems rather steep because generally a set can be bought for less than half that amount. I
assume the auctioneer thought that the Lake Toplitz provenance made them more valuable.
Many experts have stated that the British did not know that their banknotes were
counterfeited by the Germans until after the war. In fact, the British did know because
they were regularly arresting Nazi spies and the Germans had paid some of them with
Bernhard counterfeits. In February 2012 the British National Archives released documents
on the discovery of counterfeit banknotes found in the possession of Nazi spies. The
documents say in part:
According to information given by Alfred Naujocks, who gave himself up in November
1944, the Germans started to forge these notes in 1940 with the object of scattering them
over the country from the air at the time they were invading the British Isles, in order
to cause a loss of confidence and general confusion.
[These are clearly the early attempts and not the later Bernhard counterfeits].
In September 1943, the German spy Tricycle arrived with 500 five pound notes, 152
of which were counterfeits. In March 1944, the spy Treasure was found with 30 ten pound
notes, 23 of which were counterfeits.
The Bernhard 10 Pound Forgery
When I collected the German counterfeits I liked the ones that had been identified
and stamped by banks. The Germans liked to think that they were never caught but I had
many such notes with different handstamps showing that the notes had been recognized as
fakes by various European banks. The Poles have stamped this note FALSZYWY (False).
I also have notes stamped by the British FALSIFICATION.
[It appears that in some cases one section of German intelligence was selling
counterfeits in Lisbon to raise funds and another section was buying the counterfeits that
they believed were genuine and paying spies with that currency. We cannot be sure if the
Germans intended to give the spies the fake money or not. We also notice that the British
watched every banknote in foreigner’s hands and traced them back to the point of
origin trying to decide if the banknote had somehow come into German hands and was being
used to pay spies].
On Veteran’s Day 2021, I was asked to take part in a Zoom
discussion on the German counterfeit banknotes by the 400-member British
Empire Study Group of New York. I was described as a “special guest,”
and acted as a reference source for Kenneth Pugh, to answer questions and
make comments as needed. Kenneth did a very detailed report and I thought it
might be worthwhile to add some of his comments to this article, even though
20 years has passed since I wrote it. I found these comments particularly
interesting. I had shortened my report to make it brief but some of the
things Ken discussed deserved adding to the article.
He pointed out that Operation Andreas was from 1939 to 1941 and
they only prepared 5- and 10-poind notes. After Heydrich’s assassination,
Ernst Kaltenbrunner took over and Bernhard Kruger who had proven himself
very capable in the production of British banknotes in
Operation Andreas, was placed in charge. Operation Bernhard ran from 1942 to
1945 and the 20- and 50-pound notes were counterfeited then. In 1943 the
Germans started work on the U.S. $100 bill.
The headquarters for Operation Andreas was the Reichssicherheits
Hauptamt (RSHA - Amt VI) counterfeiting factory in this classic mansion
at Delbruckstrasse 6A, Schloss Charlottenberg district, Berlin. The building
was called “The Devil's Workshop” for all the secret espionage documents
created there. The second floor contained the photographic section, first
floor was administration, and the basement held the 200-ton printing press.
The printing plates were engraved onto copper in the Schloss Friedenthal
building near Sachsenhausen concentration camp. The Spechthausen paper
factory in Eberswalde was selected by to research and develop the special
linen paper for the banknotes.
The counterfeiters at Sachsenhausen, now numbering 140, up from the
original 39 Jewish prisoners, came from fifteen nations and represented
fifty-five trades or professions. Most were Jewish, but others were career
criminals that had special skills useful to the operation.
The 50 Pound Bernhard Forgery signed Peppiatt
Curiously, Sir
Kenneth Oswald Peppiatt, the Bank of England’s chief cashier,
refused to believe the counterfeit’s existed, stating that:
He could not
imagine anyone clever enough to match any piece of paper with his signature
on it.
Sir Kenneth Oswald Peppiatt
When Mussolini was arrested the German S.S. agent was given
permission to use 50,000 operation Bernhard pounds to bribe Italian officials in Naples.
Mussolini quickly located on the island of Maddalena. Approximately 25,000
pounds of Operation Bernhard currency was used in bribes to conduct the
rescue. The British and Americans were dropping weapons to the partisans in
Yugoslavia, and the Germans used Bernhard counterfeits to buy the guns from
the guerrillas and use them against the Allies.
Surprisingly, in November 1939, Paul Chourapine, a Russian spy
operating in Athens, Greece, uncovered the details of the counterfeiting
plan; Bank of England Governor Sir Montagu Norman and the other directors
were informed of the plan. Their reaction was to mostly ignore it. Even when
the French Police offered an informer who knew of the existence of a
“factory” producing five- and ten-pound counterfeits, Sir Kenneth Oswald
Peppiatt, the Bank of England's chief cashier, ignored the information. The
Bank of England first obtained examples of Operation Andreas counterfeits on
1 March 1941, when a German agent tried to pass them in a Reichsbank in
Switzerland.
This concludes our discussion of German propaganda aimed at the United States and
Europe. There are other banknote-leaflets allegedly produced, but none has been seen at
present. For instance, Murray Teigh Bloom states in The Brotherhood of Money, BNR
Press, Port Clinton, Ohio, 1983, that "the Germans planned to take French currency
plates with them when they retreated." Allegedly this plot was foiled when the French
gave the Germans deformed and faulty plates. Bloom says: "The Germans used the
deformed plates to make propaganda notes - a seeming French note on one side and on the
other a message urging French soldiers and 'maquis (Partisans)' to surrender." These
alleged surrender passes are unknown and it is probable that the leaflets in question are
those that pictured the 5-franc AMG note we mention above.
Burger claims that his Counterfeiting team forged Soviet currency and NKVD papers:
We made almost everything; Soviet rubles, and in a smaller quantity, Soviet
documents. I remember once we had to falsify 200 identity cards of the Soviet
People’s Commissariat Security employees.
Jacobson adds that the Germans intended to counterfeit French 25 franc notes but
they never produced any. He was ordered to counterfeit currency of the Netherlands but
convinced his bosses that it was too difficult.
How do I end this little look at Bernhard Kruger? Perhaps we should see his
own unrepentant words spoken to my old friend Murray Bloom:
Under my supervision and direction $600,000,000 worth of the finest British
pound notes ever made outside the Bank of England were made by me and 140
involuntary assistants. The counterfeiting experts of Scotland Yard, the
French Surete and even the U.S. Secret Service assured me, in tone of
grudging admiration, that I was responsible for more counterfeit notes in a
two-year period than all the known bogus money makers in those countries had
turned out in the previous century.
Chinese Pro-Japanese Propaganda
The Japanese Army regularly produced propaganda leaflets in an attempt to sway the
patriotism of the Chinese National Army and the guerrillas. The pro-Japanese Chinese
collaborationist government took part in a series of propaganda operations against the
legitimate Chinese government and the guerrillas that helped it.
Genuine Central Bank of China 1 yuan note of 1936 (front)
Parody of Central Bank of China 1 yuan note of 1936 (back)
The first parody of a Chinese banknote was a lithographed full-color replica of the
Central Bank of China 1 yuan note of 1936 with a safe conduct pass in brown on the back.
The serial number 558829 N/E appears on both front and back. The pass is dated 1936 in
Arabic numerals on the back and the date in Chinese on the front is MK25 (1936). This was
the original safe conduct pass. This note is also known with a slightly modified text and
different serial number.
The safe conduct message appears as nine vertical lines of Chinese text in a central
boxed area, flanked on the left by a circular area containing one vertical line of six
Chinese characters and on the right by a circular scalloped area containing one vertical
line of six Chinese characters. Above the central boxed area is a horizontal arced banner
line of five Chinese characters; below the central area is a horizontal straight line of
eleven characters. The text is:
Safe conduct pass for military troops
Welcome to the forces of peace Guarantee of safe
passage
Prior to the Official Announcement of the Military Committee, this Safe Conduct
Pass has been made for those who intend to join the peace reconstruction movement of the
New Central Government. There has been an understanding with the front-line troops of the
Japanese Army. Please show this Pass to the sentries of the Japanese Army to obtain
protection and the means to join the New Central Government.
Military Committee, National Government, Nanking
The note is described in World War II Remembered, C. Frederick Schwan and Joseph
E. Boling, BNR Press, 1995.
The Nanking Nationalist Government with Wang Ching-wei as President was a
collaborationist carbon copy of the Nationalist Government of Chiang Kai-shek. The
Japanese puppet government in Nanking copied the names of bureaus and agencies in an
attempt to appear legitimate. However, the genuine Chinese government did not have a
Military Committee. The term "peaceful reconstruction movement" was a direct
counter-propaganda slogan to the nationalist "reconstruction through the war of
resistance movement."
The second variety of this note was described in Oriental Affairs, March
1941. The text is mostly the same with some variation perhaps caused by translation but
the propaganda text at the sides of the note is described as:
Welcome to take part in peace - To safeguard your life.
The article states that the note was produced by “The Headquarters of the
Pacifying Forces in Kiangsu, Chekiang and Anhwei Province.” In addition:
The forged notes are stated to have been freely distributed among villagers in
the countryside…
Genuine Central Bank of China 5 Fen
5 Fen parody
The Japanese collaborationists then proceeded to take the propaganda message on the
back of the original banknote and reproduce it on the currency of other banks. The first
copy is a green replica of Central Bank of China 5 fen (5 cents) note of 1939 with a safe
conduct pass in green on the back, reduced in size to fit the smaller size of this note.
Curiously, they copied the serial number along with the text so this note is also 558829
N/E on the back with no serial number on the front. The pass is dated 1936 in Arabic
numerals on the back; the date in Chinese on the front is MK28 (1939).
The Ward D. Smith and Brian Matravers book Chinese Banknotes, Shirjieh
Publishers, Menlo Park, CA, 1970, is the “Bible” of Chinese numismatics. They
say in regard to the 5 fen note:
[The 5 cents] also exists with a slightly larger but otherwise identical obverse,
but with a reverse dated 1936. It was issued by the Nanking Government Military Affairs
Committee as a form of safe conduct pass to encourage defections from the Chinese
nationalist military.
Genuine Farmer’s Bank of China 1 chiao (10 cents)
A Safe Conduct Pass Parody of Farmer's Bank of China 1 chiao (10 cents)
The Chinese also parodied the Farmer's Bank of China 1 chiao (10 cents)
note of 1937 with safe conduct pass in blue on the back. The serial number appears on both
front and back. The pass is dated 1936 in Arabic numerals on the back; the date in Chinese
on the front is MK26 (1937). The text is identical to the preceding two banknotes.
A Second Parody of Farmer's Bank of China 1 chiao (10 cents)
There are two versions of the Farmer's Bank of China 1 chiao (10 cents) note of 1937
with safe conduct pass in blue. Once again the serial number appears on both front and
back. This pass is a modified reprint of the preceding item. The pass is dated 1942 in
Arabic numerals on the back; the date in Chinese on the front is MK26 (1937). Besides the
difference in date, there is a slight difference in the text in the central box: the last
(leftmost) line has only five Chinese characters rather than six, and the two references
to the "New Central Government" have been changed to "Nanking
Government."
As stated earlier, there is a second pro-Japanese safe conduct pass on the Bank of
China 1 yuan note of 1936 that we depict above. This note is dated 1936 in Arabic numerals
on the back and the date in Chinese on the front is MK25 (1936). This second variety has
the serial number 267355 N/H on the front and back. The front is identical to the genuine
banknote,
This version has the serial number 267355 N/H on the front and back. The front is
identical to the genuine banknote, and once again the safe conduct message is on the back.
This pass has the same structure as those in the preceding listing, and bears similar
texts with some minor changes and additions. The central boxed area in this pass now
contains ten vertical lines and translates to:
Safe conduct pass for military troops
Welcome to the forces of peace
Guarantee of safe passage
Prior to the Official Announcement of the Military Committee, this Safe Conduct
Pass has been made for those who intend to join the peace movement of the New Central
Government. There has been an understanding with the front-line troops of the Japanese
Army and the Pacification Army. Please show this Pass to the sentries of the Japanese Army
or the Chinese Army to obtain protection and the means to join the New Central Government.
Pacification Army of Kiangsu, Chekiang, and Anhwei Provinces
This second variety is illustrated and discussed in Oriental Affairs 15, 3
(March 1941).
In Battle Hymn of China, Knopf, NY, 1943, Author Agnes Smedley mentions a
banknote safe conduct pass dropped over the north bank of the lower Yangtze River, an area
occupied by the Communist New Fourth Army:
Another handbill looked like a banknote except that the reverse side explained the
procedure for desertion. It urged guerrillas to bring their rifles. Halt at least 200 feet
away from a Japanese garrison and wave a white flag. Next all should lay their rifles on
the earth, then, with arms uplifted, approach the Japanese sentry one by one to be
searched for concealed weapons. After that a life of ease would be theirs!
Japanese Overprint on Malaya Currency
The Japanese defeated and occupied British Malaya in 1942 and printed occupation
currency for their use. For some unknown reason they placed a propaganda message on the
back of this 1944 $100 dollar banknote.
At the right there is a red circle hand-stamp that means: “verified.”
The text is read from top to bottom, right to left, written in a poetic style
where it rhymes, with five characters per line.
It is easy to catch a tiger in the jungle [can also be “high mountain”]
It is hard to find someone to lend you money.
If you have no savings
You will have a big problem.
Greater Japan [can also be “Empire of Japan”]
Malayan Finance Department
A square red chop at left is: “Showa ___ year” The hand-stamped date is
difficult to read, but it certainly was applied during the occupation of Malaya by Japan.
There was no “Greater Japan” after their surrender in 1945.
Japanese pornographic banknote parodies
The Japanese also used pornographic photographs on their banknote parodies to catch the
attention of the Chinese soldiers and patriots. Two are reported to have been disseminated
in Chekiang Province. They were first reported in The China Weekly Review, April
13, 1946 which identified them as "Army Return certificates." The photographs
and the text are inconsistent. The first propaganda banknote appears to be imitations of
the Farmer’s Bank of China 1 chiao (10 cents) note of 1937 depicting a nude girl from
the waist up. The second note may be the Central Bank of China 1 yuan note of 1936 or
5 fen (5 cents) note of 1939 showing a nude girl sitting on a floor.
The text is identical on both notes:
I am constantly looking forward to your return. You are still fighting the war of
resistance. If you continue to fight, you will die in the field! Come back and listen to
my heart.
Ban Shigeo, a technician at the Japanese Army's 9th Technical Research Institute wrote
a slim history of the Japanese WWII Noborito Research Institute entitled: Rikugun
Noborito Kenkyujo no shinjitsu (The Truth About the Army Noborito Research Institute),
in 2001. It was reviewed by Stephen C. Mercado.
The institute was commanded by Lt. Gen. Shinoda, and was involved in projects to
develop poisons, biological agents, and the balloon bombs sent to drift over the western
United States to set forest fires near the end of the Second World War.
Of the Japanese Army's ten numbered institutes, only the 9th Army Technical Research
Institute came under the covert operations section of the Army General Staff's Second
Bureau (Intelligence). Noborito's main customers were the covert operatives trained at the
Army's Nakano School and the counterintelligence officers of the Kempeitai. Noborito
developed equipment for the men of Nakano, where the institute’s equipment was often
tested before deployment.
One wartime project was the counterfeiting of the currency used by Chiang Kai-shek's
regime with the idea of flooding the area held by Nationalist China, causing economic
upheaval, undermining confidence in the Nationalist regime, destroying the economy and
ending the Chinese resistance. The Noborito Research Institute printed the currency,
members of the Nakano School took the counterfeit notes to China, and then Imperial
Japanese Army intelligence units worked with Shanghai's notorious crime gangs to
distribute the currency.
One Type of 5 Yuan Chinese Banknote Counterfeited by the Japanese
More information about this counterfeiting operation became known in 2015. The Asahi
Shimbun stated that the Imperial Japanese Army used a private company to produce
counterfeit banknotes of China. 279 sheets, each about 30 centimeters square, were found
at the Tomoegawa Company’s paper mill in Shizuoka. The army’s Noborito institute
in Kawasaki had placed an order for the sheets with the Tokyo-based company. The sheets
showed watermarks of a profile of Sun Yat-sen, the Chinese revolutionary and founding
father of the Republic of China. They also contain silk fibers. These features are
identical to those of a 5-yuan banknote that was widely circulated in the Republic of
China at that time. Other sheets found at the mill had watermarks of the Temple of Heaven,
a historic structure in Beijing, that appeared on a different kind of 5-yuan bill back
then.
A former Imperial Japanese Army officer who was in charge of the counterfeiting project
claimed that Japan had created fake bills worth 4 billion yuan starting in 1939. It is
believed that the private company was used because the Army institute was unable to make
the banknotes in the bulk required. The civilian-made sheets were produced between August
1940 and July 1941. The workers ensured the bills looked authentic by checking the
sophistication of the watermarks and the amount of silk fibers used.
Originally, authentic banknotes used in the Republic of China were printed in Hong Kong
using technology from the United States and Britain. The machines and original plates to
print the bills in Hong Kong were confiscated and taken to the institute after Japan
occupied Hong Kong in 1941.
A second version of what is apparently the same story says that the Japanese forged the
currency of Nationalist China during 1941 to 1945 using inks and plates (and presumably
paper) seized from Chinese banks in Kowloon. The inspiration for this ploy came from
Lieutenant-Colonel Iwakuro Hideo, 8th Section, Army GHQ, who was a graduate of the Nakano
School for espionage according to Louis Allen, "Nakano School for spies," World
War Investigator, Vol. 1, No. 12, 1989.
At the end of the war, the United States secretly employed some of the counterfeiters
and installed them at the Yokosuka naval base. They continued to forge currency and
documents to support American agent operations in Communist China, North Korea, and the
Soviet Far East. This story first came to light when Ariga Tsutao, a former member of the
current Japan Defense Agency and a noted authority on the Imperial Japanese
Military’s intelligence community, made the allegation.
There were reports in 1943 of the Japanese flooding China with large sums of
counterfeit Bank of China currency notes. Reports from Kweilin indicate that 10 billion
dollars in forged currency were introduced into China. It is interesting to note that
American agents thought the report was exaggerated and recommended that a figure of 100
million dollars be specified instead. In a later letter to the Secretary of the Treasury,
the sum is further reduced to 10 million dollars. The same letter reports that the
Japanese have counterfeited US dollars, Hong Kong dollars, and British sterling. Other
experts such as C. M. Nielsen told me that the Japanese government did not always sponsor
the counterfeiting, but they would often stand by and allow private counterfeiters to
wreak havoc on the Chinese economy.
It is likely that other German and Japanese propaganda banknotes will surface in the
coming years. These are all that are known at the moment. Readers with comments or
additional information are encouraged to write to the author
at sgmbert@hotmail.com.
