Foreign Relations of the United States: Diplomatic Papers, 1944, General: Economic and Social Matters, Volume II

800.515/9–144: Telegram

The Ambassador in the United Kingdom (Winant) to the Secretary of State

London, September 1, 1944—6 p.m.
[Received September 2—8 a.m.]

7137. For Department, Treasury and FEA. Refer Department’s A–702, April 25 and Embassy’s A–744, June 17.

1. Prior to MEW receiving requisite directives some weeks ago to collect information regarding enemy efforts to secrete assets in neutral countries, Embassy’s repeated discussions with MEW were necessarily general and tentative. Since receipt of directives MEW is proceeding along the following lines for collecting material: firstly, it has prepared a draft circular to British Missions; secondly, it is examining its own files; thirdly, it is arranging for data to be obtained through British censorship and secret services.

2. The text of the draft British circular to Missions is given in Embassy’s A–1067, September l.¹⁸ The draft was recently sent to Foreign Office, Treasury, Board of Trade, Trading with Enemy Department and Embassy for clearance before being sent to British Missions in Lisbon, Madrid, Stockholm, Ankara, Bern, Tangier, Buenos Aires and Washington. To save time MEW will despatch the circular immediately after it has been cleared in London.

3. In meantime Department’s circular airgram to Missions on flight of Axis capital arrived and Embassy discussed British draft with MEW in a preliminary way in the light of the airgram a copy of which was given to MEW. We pointed out that the British draft though broad in its scope does not include new enemy enterprises such as in paragraph numbered 1 of the circular airgram and MEW has agreed to include specific mention of such enterprises in the British circular.

4. Embassy also emphasized to MEW that while British draft substantially covers realisable assets it omits entirely a broader phase of the problem involving specialized enemy personnel along lines of paragraphs numbered 4 to 7 of Department’s circular airgram. MEW appreciates importance of such personnel in building up Germany’s post-war economic potential but its initial reaction is that in the British organizational setup other Departments both in London and in their Missions such as secret services and passport control are involved. MEW’s view therefore is that this enemy personnel problem should be incorporated in a separate and supplementary circular and a reference in the British draft under consideration might be made to such contemporaneous or forthcoming circular. MEW is clearing this matter with other interested British agencies and ETO¹⁹ will keep our authorities advised of developments.

5. Subject to considerations in paragraphs 3 and 4 above Embassy believes that the draft British circular substantially meets requirements. It will probably take 12 days before the draft clears other British agencies. Accordingly it is anticipated that our authorities will have sufficient time to telegraph their suggestions after arrival of Embassy’s A–1067. In any event any suggestions of our authorities would be incorporated in a further circular letter to British Missions.

6. Soon after MEW had obtained directives for the collection of information an internal MEW memorandum in the form of a standing order (No. 282) was issued on August 18²⁰ to guide the various sections of MEW in their watch on current transactions. A copy of the order is contained in Embassy’s A–1068, September l.²⁰ The terms of the order provide for compiling a register to the extent possible of German assets in neutral countries. Information sought is divided under headings of “loot” and “flight capital”. Embassy also pointed out to MEW in connection with the order that it omitted reference to new enemy enterprises and movements of specialized enemy personnel. Since the order is solely an internal MEW memorandum there will be no difficulty in supplementing it to include these additions.

7. The standing order mentioned in preceding paragraph formed the basis of MEW’s requests for data to British censorship and secret services. As a result there were no references to new enemy enterprises and movements of specialized enemy personnel but it is understood that in fact these are included in the scope of the existing tripartite censorship agreement. Accordingly MEW will ascertain whether the coverage of materials under the tripartite agreement is adequate. In this connection it is possible that Washington is not receiving copies of all British wireless intercepts; MEW will investigate with a view to remedying any lacunae. In turn MEW raised the question of our censorship supplying the British with similar material particularly from Argentina. MEW emphasized its view that the information obtained through censorship and secret services will be more valuable than that obtained through the missions.

8. MEW has also commenced investigation of its own files particularly those in black list and financial intelligence sections. However, information in MEW’s files was obtained in order to conduct economic warfare operations rather than as an intelligence procurement problem; hence much of MEW’s material deals only generally or indirectly with the instant problem. Accordingly it will take considerable time apart from inadequate staffing to collect a large amount of material. The first result of searching MEW’s files is contained in 12 brief miscellaneous reports which are being forwarded to Department by despatch No. 17813 of September l.²¹ MEW has promised further similar reports in the near future.

9. On the operational side MEW is paying more attention to problems of looting and secretion of enemy assets by emphasizing listing neutrals involved in such activities.

10. British agencies now primarily interested in collecting information on looting and secretion of assets are MEW and TED.²² It is understood, however, that although MEW has been charged with the collection of data on these problems all its information will be turned over to other agencies at the conclusion of hostilities with Germany. In the first instance TED will probably be the recipient of MEW’s collected information.

11. British have not decided the ultimate uses to which the collected material will be put. It is understood that this question of overall policy will be discussed with our authorities.

12. Embassy is preparing a telegram on MEW’s initial reactions to Department’s circular airgram of August 23.

Winant

18. Not printed.
19. European Theatre of Operations.
20. Not printed.
20. Not printed.
21. Not printed.
22. Trading with the Enemy Department.