800.20235/431b: Circular airgram
The Secretary of State to the Diplomatic Representatives in the American Republics Except Argentina, Bolivia, Chile, and Paraguay
The following background information concerning Axis activities in Argentina is being sent to you for your information and possible use in conversation with authorities of the government to which you are accredited but not for transmittal in writing to the Foreign Office:
The most conspicuous example of direct aid given Axis interests by agencies of the present Argentine Government is in the case of El Pampero, the pro-Nazi newspaper. El Pampero is known to have received funds from the German Embassy over a period of several years. The day after Argentina severed relations with the Axis, the editor of El Pampero, Enrique P. Oses led a group of persons who personally protested the act of the Government. Oses was arrested but almost immediately released. El Pampero denounced the break editorially and the paper was suspended because of its criticism of the government. Within a week, however, it was replaced by El Federal. The latter retains the same editor and has the same format. It is issued from the same office and distributed under El Pampero’s old mailing permit. Newsprint for El Pampero and El Federal was supplied by the Ministry of Agriculture headed by Diego Mason. This Ministry has been buying 300 tons monthly of locally manufactured newsprint which it has sold at less than current market prices to these and other pro-Nazi papers. El Federal, like its predecessor El Pampero received paid advertising from the Ministry of Agriculture, the Municipality of Buenos Aires and the Postal Savings Bank. Since February 25, Colonel Diego Mason has been Acting Foreign Minister as well as Minister of Agriculture.
The German firms in Argentina, as is well known, have contributed funds to the German Embassy for Nazi propaganda purposes over a [Page 302] period of many years. About 80 per cent of the funds so used in Argentina were from Argentine sources, the remaining 20 per cent being supplied from sources in Germany. Due to the declining fortunes of the Reich in the war it became apparent last fall that the German Embassy was finding it increasingly difficult to secure these contributions. But when there were indications that President Ramírez might for whatever motive break relations, German firms, realizing that they would then be in danger of being expropriated by the Argentine Government in the process of implementing the break of relations, began to cooperate voluntarily with the German Embassy in an effort to protect their own interests. Thus in the past few months it seems apparent that more money than ever has been spent by German interests in Argentina in a desperate effort to influence the leaders of the Argentine Government. These funds have been supplied with two objects in view: (1) the business interests are willing to do anything to win self-preservation, (2) the German Embassy is taking advantage of this willingness with the object of preserving a foothold in Argentina so as to make that much of South America a haven where Nazi strength may eventually be renewed, even though Germany is defeated in Europe. There are several documents substantiating this claim in the form of directives and information sent from the Embassy to German groups.
The case of El Pampero also illustrates the foregoing. A few months ago El Pampero proposed the liquidation of a newspaper employees’ pension fund. This would have released for return to the newspapers money held by the Government, of which El Pampero evidently was in need.
While it can not be proven, it is generally accepted as true that long-established German firms have transmitted funds to Argentine officers through the system of bribes, kickbacks, loans, over-drafts and many other kinds of favors so that these firms are in a position to exert tremendous pressure on certain Army officers. An illustration of the friendly relations existing between Argentine Army officers and important German firms is seen in the case of Colonel Perón himself. Shortly after the break of relations, Colonel Perón visited the Bayer Company plant where, after making a minute inspection, he was honored at a luncheon attended by the entire personnel. His speech on that occasion indicated a friendly attitude toward this extremely influential German-owned company. While it is unnecessary to review the well-known history of activities of this and other German firms as semi-official agencies working in the interest of the Nazi party and the German Government in Argentina, it is of interest to note that Heinrich Vollberg, the former gauleiter of the German business community in Buenos Aires, began his career as an employee of the Bayer Company.
[Page 303]Also illustrating the close relationship existing between Argentine Army officers and German firms is the well known fact that when bidding has opened on Army construction jobs, the Germans usually have known so much about details of the construction in advance that they have been able to bid much more closely than their competitors and still be sure of a profit.
For the past three years the Argentine Government has acted in negotiations in order to favor and aid Proclaimed List firms.3 Government authorities have openly and deliberately circumvented the provisions under which American merchandise has been released for Argentina by forcing our accepted dealers to transfer materials to Axis companies. The Ministry of Agriculture under Diego Mason has been conspicuous in such activities, likewise the Ministries of War and Public Works, the latter now under General Pistarini.
Due to the protection accorded them by these Government agencies, the firms in Argentina having closest connections with the German Reich during the past four years have been able to improve their financial situations and in some cases have doubled and even trebled their profits, as is proven by available comparative balance sheets of 21 representative German-controlled companies.
From January 31, 1942 to March 31, 1943, Argentine Government departments gave contracts to such firms totaling 34,000,000 Argentine pesos. Foreseeing the difficulties that these firms would have in obtaining certain materials needed for the execution of the contracts, the Government acted as an intermediary in order to obtain the necessary materials.
From January 1, 1942 to February 28, 1943, six Argentine Government agencies purchased material from German firms totaling 6,600,000 Argentine pesos. These firms did not have monopolies in any field. There are numerous specific examples of the means employed by the Argentine Government in order to secure release of materials for the use of German controlled firms. For example, the Ministry of Agriculture circumvented its own regulations regarding bids in order to give a contract for central heating to a Proclaimed List firm. In another instance a pro-Allied firm received a written order from the Ministry of Public Works requiring it to accept bids from certain Proclaimed List firms.
In September 1943 the principal tanning business on the Proclaimed List in Buenos Aires, owned by Ketelhohn Hermanos, was in a precarious condition due to lack of quebracho, supply of which was controlled by pro-Allied organizations. Two representatives of the Ministry of Agriculture called on the local quebracho manufacturers [Page 304] and under a law prohibiting hoarding of merchandise required them to show cause for their failure to deliver quebracho to Ketelhohn Hermanos. Soon afterward these firms received written requests from the Ministry of Agriculture for delivery of considerable quantities of quebracho extract to this tanning company.
Subsequently, it became known that the partners of Ketelhohn Hermanos openly boasted that through the aid of the Ministry of Agriculture they had forced pro-Allied firms to deliver merchandise and that by its intervention the Ministry had enabled them to build up large stocks of quebracho so that they would not suffer in the event Argentina broke relations with the Axis in the future.
Basilio Pertiné has been in the position of Mayor of Buenos Aires since June 15, 1943. He is perhaps the most outstanding pro-Nazi in the Government. In 1942 he was president of three major German companies and was director of Siemens Schuckert, whose branch in Argentina is regarded as a center of Nazi espionage. Pertiné attended artillery school in Germany and later was Argentine Military Attaché in Germany. He served in the German Army during World War I and was attached to the German General Headquarters. A letter in the files of the Argentine Committee Investigating Anti-Argentine Activities indicated that he maintained friendly relations with General von Faupel, President of the Ibero-American Institute of Berlin, the central office where the strategy for the German penetration of Latin America was prepared. General Pertiné was accused of pro-Nazi activity by the Committee Investigating Anti-Argentine Activities.
In 1942 the American Ambassador presented to the Argentine Foreign Office three confidential memoranda relating to Axis espionage activities4 and gave to the Minister of the Interior a list of questions for the use of the police in questioning certain Axis agents. The police who were conducting the actual investigation were never given copies of these memoranda and the Minister of the Interior refused two offers made by the American Ambassador to cooperate in establishing the guilt of the agents in question.
During these investigations the Federal police allowed the suspects considerable freedom and opportunity to converse with one another and lodged them in offices instead of in cells. The police report following examination of the agents, revealed practically no information of value and the only individuals singled out for questioning were almost entirely exonerated.
In the meantime, however, the Provincial Police, not controlled by the Federal Police, independently secured the unexpected confession [Page 305] of Hans Napp. His confession involved several of the persons mentioned in the Ambassador’s memoranda who had been exonerated by the Federal Police. Afterward Napp stated that he had not expected to be questioned in view of the fact that he understood arrangements for his protection had been made with the Federal Police.
In light of the foregoing it is important to note that throughout the period in which the forces now in control of the Argentine Government have been gaining influence and consolidating their strength, special interest has been shown in increaseing the power and extending the jurisdiction of the Federal Police. As examples of this policy, it was reliably reported in November that Colonel Emilio Ramírez was preparing a secret police force based on the plan of the German “Hauswart”. On December 24, the Government published a decree authorizing the Federal Police to act throughout the nation. The Federal Police now deal with matters pertaining to counter-espionage and sabotage, and are authorized to “guarantee the safety of persons and effects falling within inter-jurisdictional (international) commerce in order to prevent crimes.” The Federal Police also are authorized to deal with specified crimes, especially those concerning foreign diplomatic and consular officials. Pro-Axis interests thus not only have a firm foothold in the Ministry of the Interior and the Federal Police, the exact points where all activities concerning foreign agents must converge, but also have succeeded in so expanding and defining the powers of the Federal Police as to place the pro-Nazi officers heading that department in a position of complete control over everything pertaining to the detection, apprehension and prosecution of foreign agents, whether private individuals or consular or diplomatic officers, throughout the entire country.
- For correspondence on the control of Axis interests in Argentine trade, see pp. 409 ff.↩
- For communications concerning espionage activities of Nazi agents, see Foreign Relations, 1942, vol. v, pp. 186 ff.↩